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NLRB Adopts New Joint-Employer Standard

Wednesday, September 2, 2015

(North American Meat Institute)

The National Labor Relations Board (NLRB) voted Thursday to redefine its test for determining joint-employer status, ruling that companies can be held responsible for labor violations committed by their contractors. In a 3-2 decision, which reversed a previous August 2013 ruling, the NLRB determined that Browning-Ferris, a recycling company that used Leadpoint Business Services to staff its California facility, should be considered a joint employer with the staffing agency, because it exercised sufficient control over hiring, firing, discipline, supervision, and work hours. As a result, Browning can be pulled into collective bargaining negotiations with those employees and held liable for any labor violations committed against them. Teamsters' ballots, which were impounded after an April 2014 election, must now be counted. If the union wins, direct bargaining with both Browning and Leadpoint is permitted. The ruling represents a departure from previous decisions that stated companies were only responsible for employees who were under their direct control. In its ruling, NLRB asserted that the old standard, which has been in place since the 1980s, is "increasingly out of step with changing economic circumstances." NLRB will no longer require that joint employers exercise the authority to control terms and conditions of employment, and stated indirect control may establish joint-employer status.

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