Taking its new joint employer standard to new heights, the NLRB found that Retro, a construction company, and Green JobWorks, a temporary staffing agency, are joint employers based on speculative future projects. Retro Environmental, Inc./Green JobWorks, LLC, 364 NLRB No. 70 (Aug. 16, 2016).

A year ago, in Browning-Ferris, 362 NLRB No. 186 (Aug. 27, 2015), the Board adopted a new joint employer standard involving a broad two-part test: (1) whether a common law employment relationship exists; and (2) whether the potential joint employer “possesses sufficient control over employees’ essential terms and conditions of employment to permit meaningful bargaining.”

During the summer of 2015, Green JobWorks provided temporary employees to Retro for work on two public school projects set to conclude before the end of August. Once the projects concluded, Retro had no pending requests for additional employees from Green JobWorks.

The Construction and Master Laborers’ Local 11, a/w Laborers’ International Union of North America filed a petition to represent full-time and part-time laborers, including workers jointly employed by Retro and Green JobWorks.

Relying on Davey McKee Corp., 308 NLRB 839 (1992), the Regional Director dismissed the representation petition, finding an imminent cessation of operations and insufficient evidence the petitioned-for unit would exist beyond mid-July.

The Regional Director also noted that there was no evidence that Retro contemplated using Green JobWorks for temporary labor in the future. This was reinforced by the fact that the parties had no future projects (or bids for projects) in the works and because Retro regularly used at least three other temporary staffing agencies for similar projects.

The Regional Director did not make a formal determination on joint employment; however, he noted “[t]he evidence in the record presents a colorable claim of a joint employer relationship” under two cases the Board subsequently overruled in Browning-Ferris. The Regional Director explained that Green JobWorks is “responsible for matters such as recruiting, hiring, disciplining, terminating, setting employee wage rates, paying employees’ wages, determining which projects employees are assigned to, and transferring employees to different projects.” Further, he noted there was evidence “that Retro determines how workers perform their duties” and both employers provided certain equipment to the employees.

The Board disagreed with the Regional Director. It stressed that Retro imposed conditions on the type of employees Green JobWorks could hire, including requirements that employees be prescreened, drug-tested, and qualified to perform services. In addition, Retro insisted that employees assigned to its worksite complete safety training, have certain certifications, and have passed a physical exam.

Similarly, while Green JobWorks essentially controlled the hiring/firing/discipline of its employees, Retro was consulted in the assignment of specific workers to its sites, retained the right to request replacement workers if it was unsatisfied with a temporary employee, determined the number of workers supplied to a particular project, determined employee hours/scheduling, and provided direct day-to-day supervision on the job site.

These indicators of control led the Board to find Retro made core staffing and operational decisions that defined all employees’ work days. The Board also found that each employer was able to influence and control some of the other’s decisions and that between them, Retro and Green JobWorks controlled all of the employment terms.

Surprisingly, the Board found there was not an imminent cessation of operations because Retro and Green JobWorks did not cease to operate, fundamentally change the nature of their businesses, or move. Likewise, the Board found no evidence the employers intended to discontinue their working relationship in the future.

The Board reinstated the petition and remanded the matter to the Regional Director for action.

Member Philip Miscimarra dissented, noting the majority’s decision, based on nothing more than speculation regarding the parties’ future endeavors, rendered the Browning-Ferris case-by-case fact-intensive analysis moot.

An appeal of Browning-Ferris is pending in the U.S. Court of Appeals for the District of Columbia and the upcoming Presidential election may temper or amend how the standard is applied in the future. We will continue to keep you apprised as these two matters progress.