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The New Joint Employer Standard - Recent Applications to NLRA and Title VII Cases

Date Published: 11/18/2015

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In August 2015, in its controversial Browning-Ferris decision, the National Labor Relations Board (NLRB) redefined the standard for determining joint employer status. In essence, Browning-Ferris dramatically narrowed the definition of joint employment under the National Labor Relations Act (NLRA). Under the new standard, employers, whether or not they exercise direct control, are more likely to be liable to employees for issues arising in joint employment scenarios, such as collective bargaining, defending unfair labor practices and addressing labor strikes.

The NLRB Limits Its Impact

On October 21, 2015, however, in its first application of this new standard, the NLRB seems to have reined in the Browning-Ferris decision. In Green Jobworks LLC, the Board determined that ACECO, a demolition and remediation contractor, was not a joint employer with Green Jobworks, its staffing agency. In distinguishing the Green Jobworks employers from those in Browning-Ferris, the Board focused its analysis on four areas:

  1. Unlike the joint employer in Browning-Ferris, which had the power to control hiring decisions, ACECO had little authority in matters of hiring, firing or disciplining employees. Instead, these decisions were mostly delegated to Green Jobworks, the staffing agency.
  2. Unlike the Browning-Ferris employer, ACECO had no control over the wages of the workers provided by Green Jobworks.
  3. In Browning-Ferris, the employer exercised daily supervision and oversight of the employees. In contrast, ACECO did not supervise the employees provided by Green Jobworks, but rather, along with these employees, was subject to the supervision of the general contractor.
  4. Because the Browning-Ferris employer oversaw activities that typically involve bargaining, such as employee break times and productivity, it closely resembled an employer. On the other hand, the NRLB found that ACECO had no such bargaining-like authority.

In the Browning-Ferris decision, the dissenting Board member expressed concern that the new standard would always hinge upon questions of fact and inevitably vary from employer to employer. As a result, the dissent argued, there would be no real, workable guidance for determining joint-employment status. This concern, when considered in light of the Board's most recent decision in Green Jobworks, proves itself to be a potent one because, as the dissenters predicted, the outcome in the Green Jobworks decision was determined using a very fact-specific analysis. Thus, Green Jobworks' application of the Browning-Ferris decision demonstrates that employees cannot simply bank on "the assumed pro-union stance of the Board," but rather must be able to present specific facts to support their cases against joint employers.

While this is just one application of the new Browning-Ferris decision, and the next could be the exact opposite, it does indicate that proactive employers who take measures to distance their oversight and authority over temporary staffing workers, sub-contractors and other third-party labors can avoid being found to be a joint employer, at least under the National Labor Relations Act.

Expanded Application to Title VII Cases

This is especially true in light of attempts to apply the Browning-Ferris standard of a "joint employer" even beyond the NLRA's application. Last month, a lawsuit was filed by a Fairfield Inn hotel employee seeking damages under Title VII for claims that her Assistant Manger sexually harassed her and several other Housekeepers into "sexual servitude." In addition to naming the hotel's ownership group, TMI Hospitality Incorporated, the plaintiff-employee also named Marriott International, who granted TMI the franchise to operate the Fairfield Inn hotel, purely on the basis that Marriott was a Franchisor to TMI.

In the complaint, the plaintiff-employee cites to Browning-Ferris in support of her claim that Marriott exercised "direct, indirect or potential control over essential working conditions." As a result, the lawsuit alleges, Marriott is a joint employer and therefore liable for the Assistant Manager's harassment. Whether the court in that lawsuit keeps Marriott in the lawsuit remains undetermined for now; however, the fact that plaintiffs will attempt to bring in franchisors and other third-party, upstream entities into civil litigation because of the Browning-Ferris decision is noteworthy to say the least.

As mentioned above, employers that utilize contract laborers, temporary staffing or operate as a franchisor/franchisee should take a proactive step in limiting business practices that could sustain a finding of joint employment (i.e., liability) that could have been avoided. Contact an attorney with the Firm for information on the measures to be taken for risk assessment purposes.

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Altra Industrial Motion Inc.

Altra Industrial Motion Inc. has multiple locations in the U.S., as well as Central America, Europe, and Asia. The Employment Law Alliance has proved to be a great asset in assisting us in dealing with employment issues and matters in such diverse venues as Mexico, Australia, and Spain. We have obtained excellent results using the ELA network for matters ranging from a multi-state review of employment policies to assisting with individual employment issues in a variety of foreign jurisdictions.

In one instance, we were faced with an employment dispute with a former associate in Mexico that had the potential for substantial economic exposure. The matter had been pending for over a year, and we were not confident in the employment advice we had been receiving. I obtained a referral to the ELA counsel in Mexico, who was able to obtain a favorable resolution of the dispute in only a few days. Based on our experiences with the ELA, we would not hesitate to use its many resources for future employment law needs.

American University in Bulgaria

In my career I have been a practicing attorney, counsel to the Governor of Maine, and CEO of a major public utility. I have worked with many lawyers in many settings. When the American University in Bulgaria needed help with employment litigation in federal court in Syracuse, New York, we turned to Pierce Atwood, the ELA member we knew and trusted in Maine, for a referral. We were extremely pleased with the responsiveness and high quality of service we received from Bond Schoeneck & King, the ELA's firm in upstate New York. I would not hesitate to recommend the ELA to any employer.

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Member of Board of Trustees 

Arcata Associates

I really enjoyed the Conducting an Effective Internal Investigation in the United States webinar.  We are in the midst of a rather delicate employee relations issue in California right now and the discussion helped me tremendously.  It also reinforced things that you tend to forget if you don't do these investigations frequently.  So, many, many thanks to the Employment Law Alliance for putting that webinar together.  It was extremely beneficial.

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Vice President, Human Resources

Barrett Business Services, Inc.

I recently participated in the ELA-sponsored webinar on the Employee Free Choice Act.  I was most impressed with that presentation.  It was extremely helpful and very worthwhile.  I have also been utilizing the ELA's online Global Employer Handbook.  This compliance tool is absolutely terrific. 

I am familiar with several other products that purport to provide up-to- date employment law information and I believe that this resource is superior to other similar compliance manuals.  I am delighted that the ELA provides this free to its members' clients.

Boyd Coffee Company

Employment Law Alliance (ELA) has provided Boyd Coffee Company with a highly valued connection to resources, important information and learning. With complex operations and employees working in approximately 20 states, we are continually striving to keep abreast of specific state laws, many of which vary from state to state. We have participated in the ELA web seminars and have found the content very useful. We appreciate the ease, cost effectiveness and quality of the content and presenters offered by these web seminars.  The Global Employer Handbook has provided our company with a very helpful overview of legal issues in the various states in which we operate, and the network of attorneys has helped us manage issues that have arisen in states other than where our Roastery and corporate headquarters are located in Portland, Oregon.

Capgemini Outsourcing Services GmbH

As an international operating outsourcing and consulting supplier Capgemini has used firms of the Employment Law Alliance in Central Europe. We were always highly satisfied with the quality of employment law advice and the responsiveness. I can really recommend the ELA lawyers.

Hirschfeld Kraemer

Stephen HirschfeldAs an employment lawyer based in San Francisco, I work closely with high tech clients with operations around the globe. Last year, one of my clients needed to implement a workforce reduction in a dozen countries simultaneously. And they gave me 48 hours to accomplish this. I don't know how I could have pulled this off without the resources of the ELA. I don't know of any single law firm that could have made this happen. My client received all of the help they needed in a timely fashion and on a cost effective basis.

Stephen J. Hirschfeld
Partner 

Hollywood Entertainment Corporation

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Ingram Micro

Ingram Micro is the world's largest technology distributor, providing sales, marketing, and logistics services for the IT industry around the globe. With over 13,000 employees working throughout the U.S. and in 35 international countries, we need employment lawyers who we can count on to ensure global legal compliance. Our experience with many multi-state and multi-national law firms is that their employment law services are not always a high priority for them, and many do not have experts in many of their offices. The ELA has assembled an excellent team of highly skilled employment lawyers, wherever and whenever I need them, and they have proven to be an invaluable resource to our company.

Konami Gaming

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Vice President, Human Resources

Nikkiso Cryo, Inc.

Until recently, I was unaware of the ELA's existence. We have subsidiaries and affiliates throughout the United States, as well as in Asia, the Middle East and Europe. When a recent legal issue arose in Texas, our long-time Nevada counsel, who is a member of the ELA, suggested that this matter be handled by his ELA colleague in Dallas. We are very pleased with the quality and timeliness of services provided by that firm, and we are excited to now have the ELA as an important asset to help us address employment law issues worldwide.

Palm, Inc.

The ELA network has been immensely important to our company in helping us address an array of human resources challenges around the world. I strongly encourage H.R. executives who have employees located in many different jurisdictions to utilize the ELA's unparalleled expertise and geographic coverage.

Stacy Murphy
Former Senior Director of Human Resources

Rich Products

As the General Counsel for a company with 6,500 employees operating across the U.S. and in eight countries, it is critical that I have top quality lawyers on the ground where we do business. The ELA is an indispensable resource. It has taken the guesswork out of finding the best employment counsel wherever we have a problem.

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Ricoh Americas Corporation

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Roberts-Gordon LLC

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Rockwell Collins, Inc.

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Assistant General Counsel

Sanmina-SCI

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Starwood

We own, manage, and franchise hotels throughout the U.S. and in more than 90 countries. With more than 145,000 employees worldwide, ensuring that we comply with the complex web of local labor and employment laws in every one of these jurisdictions is a daunting task. The Employment Law Alliance has served as an important resource for us and we have benefited greatly from its expertise and long reach. When a legal dispute or issue has arisen in some far-flung place, Employment Law Alliance lawyers have always provided responsive, practical, and cost-effective assistance.

Wilmington Trust Corporation

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