The National Labor Relations Board (NLRB) has ruled that Browning-Ferris Industries is not a joint employer of employees of one of its contractors. Browning-Ferris Industries of California, Inc., 369 NLRB No. 139 (July 29, 2020) (B-F II).

The NLRB held that the Obama-era NLRB’s 2015 decision that overruled 30 years of NLRB precedent on the standard for determining whether two unrelated employers are the joint employers of one of those employer’s employees [Browning-Ferris Industries of California, Inc., 362 NLRB 1599 (2015) (B-F I)] should not have been applied to Browning-Ferris. The NLRB found “retroactive application … of the new joint-employer standard in this case would be mani­festly unjust.”

Case History

This case has a long and complicated history that began in 2013. In general, in the early stages of B-F I, in connection with a union organizing drive, Browning-Ferris was found to be a joint employer of the employees of a contractor, Leadpoint. The union won the election. Because Browning-Ferris was a joint employer of the employees, the union’s victory meant the company had an obligation to bargain under the National Labor Relations Act (NLRA) with the union. When the joint-employer issue reached the NLRB, it announced the new standard, which was significantly more union-friendly than the old standard. For more on that standard, see Labor Board Sets New Standard for Determining Joint Employer Status.

B-F II was issued in connection with a “test-of-certification” proceeding, whereby an employer (here, Browning-Ferris) that believes the NLRB issued an incorrect decision may refuse to bargain with its employees’ union. Through a circuitous route, the appeal is presented to a U.S. Court of Appeals, which decides whether to enforce the NLRB’s decision. Here, the Court remanded the case to the NLRB to clarify certain issues raised by its new standard. The NLRB then issued B-F II.

Retroactivity

The NLRB maintains a presumption that its new decisions will be applied retroactively. However, the presumption does not apply “where retroactivity will have ill effects that outweigh the mischief of producing a result which is contrary to a statutory design or to legal and equitable principles.” In other words, the NLRB will apply a new rule “to the parties in the case in which the new rule is announced and to parties in other cases pending at the time so long as [retroactivity] does not work a manifest injustice.”

Further, the NLRB explained, with respect to “manifest injustice,” it “typically consid­ers the reliance of the parties on preexisting law, the effect of retroactivity on accomplishment of the purposes of the Act, and any particular injustice arising from retroactive application.”

B-F II

Noting the previous standard had been in effect for at least 30 years and employers had relied upon it, the NLRB decided in B-F II the presumption was “significantly outweighed by its potential ill effects.” The current NLRB decided B-F I should not have been applied retroactively to find that Browning-Ferris was a joint employer of Leadpoint’s employees.

Accordingly, the NLRB amended the election result (Certification of Representative) and removed Browning-Ferris as a joint employer of Leadpoint’s employees.

On a side note, the decision was signed by NLRB Chairman John Ring and Member Marvin Kaplan. Member William Emanuel was a member of the panel, but did not participate in the decision on the merits, the NLRB noted. (Presumably, he participated in discussions about the case with Ring and Kaplan, but left final decision-making to them.) The NLRB did so because, without Member Emanuel as a member of the panel, the NLRB would not have had a quorum (three members) to decide the case. However, Member Emanuel could not participate in the decision on the merits because the NLRB’s Inspector General determined in 2018 that he had a conflict because his former firm represented Leadpoint prior to his becoming an NLRB member.

***

This decision does not affect the NLRB’s joint-employer rule, which was effective on April 28, 2020. That rule “reinstated and clarified the joint-employer standard in place prior to” B-F I. For more on the final rule, see Labor Board Issues Final Rule for Determining Joint-Employer Status.

If you have any questions about this decision or the NLRB, please contact a Jackson Lewis attorney.

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Photo of Howard M. Bloom Howard M. Bloom

Howard M. Bloom is a Principal in the Boston, Massachusetts, office of Jackson Lewis P.C. He has practiced labor and employment law representing exclusively employers for more than 36 years.

Mr. Bloom counsels clients in a variety of industries on labor law issues.

Howard M. Bloom is a Principal in the Boston, Massachusetts, office of Jackson Lewis P.C. He has practiced labor and employment law representing exclusively employers for more than 36 years.

Mr. Bloom counsels clients in a variety of industries on labor law issues. He trains and advises executives, managers and supervisors on union awareness and positive employee relations, and assists employers in connection with union card-signing efforts, traditional union representation and corporate campaigns, and union decertification campaigns. He also represents clients at the National Labor Relations Board in connection with bargaining unit issues, objections and challenges, as well as unfair labor practice investigations and trials. Mr. Bloom also has been the spokesperson at countless first and successor contract collective bargaining negotiations, and regularly advises on collective bargaining agreement administration issues, including grievance/arbitration issues.

Mr. Bloom has appeared before the Massachusetts Supreme Judicial Court, the U.S. Court of Appeals for the District of Columbia, several U.S. District Courts, the National Labor Relations Board, the Massachusetts Labor Relations Commission, the Equal Employment Opportunity Commission and the Massachusetts Commission Against Discrimination.

Mr. Bloom speaks frequently to employer groups on a wide range of labor and employment law topics. He also has written extensively on labor and employment law for a variety of publications, including New England Business magazine, The Boston Globe and the Boston Business Journal. He also is editor of and a frequent contributor to the Jackson Lewis Labor & Collective Bargaining Blog.

While attending law school, he was the Executive Editor of The Advocate: the Suffolk University Law School Journal and President of the Student Bar Association.

Mr. Bloom is a diehard baseball fan. His first book, The Baseball Uncyclopedia: A Highly Opinionated Myth-Busting Guide to the Great American Game, was published in February 2006.

Photo of Jonathan J. Spitz Jonathan J. Spitz

Jonathan J. Spitz is a Principal in the Atlanta, Georgia office of Jackson Lewis P.C. and he is the national co-Coordinator of the Firm’s Collegiate and Professional Sports industry group.

Mr. Spitz coordinates Jackson Lewis’ labor practice for the Southeast region of the…

Jonathan J. Spitz is a Principal in the Atlanta, Georgia office of Jackson Lewis P.C. and he is the national co-Coordinator of the Firm’s Collegiate and Professional Sports industry group.

Mr. Spitz coordinates Jackson Lewis’ labor practice for the Southeast region of the United States. He understands the practical and operational needs of clients, helping design pragmatic strategies to minimize risk and maximize performance. He was selected as a “Leader in the Field” by Chambers USA in 2009 and 2010.

He has represented management in numerous counter-organizing drives and participated in dozens of unfair labor practice proceedings, discrimination charges and other matters before the National Labor Relations Board, the Equal Employment Opportunity Commission and various federal and state administrative agencies, as well as in collective bargaining, arbitration and in employment litigation before state and federal courts. Mr. Spitz regularly counsels employers in employee relations and discipline and discharge matters, and also assists employers in drafting employment policies and in complying with the Family and Medical Leave Act, drug testing laws and regulations, the Americans with Disabilities Act and other federal and state employment laws.

Mr. Spitz has extensive experience in assisting employers to create union and litigation avoidance strategies suitable to the individual organization, values and industry. He has led teams conducting multi-facility labor vulnerability assessments and has advised employers in responding to corporate campaigns and demands for card check and neutrality.

Mr. Spitz is a contributing author of Employer’s Guide to Union Organizing Campaigns, Aspen Publishers, 2007. In addition, he has authored many articles regarding labor and employment law issues which have appeared in national trade publications.

Mr. Spitz is admitted to practice in the Second, Fourth, Sixth, Eleventh and District of Columbia Circuit Courts of Appeals; the United States District Court for the Middle District of Georgia; and the Georgia Supreme Court.

He received his Bachelor of Arts degree, cum laude, from Tufts University in 1990. He earned his J.D. from Emory University in 1993