NLRB Throws Out Joint Employer Liability Decision, Leaving Browning-Ferris as the Rule

Article main image
Feb 26, 2018

December’s joint employer decision by the NLRB which overturned an earlier case expanding joint employer liability was vacated today after an opinion by the inspector general that there was a conflict of interest.

What this means is that the Board’s 3-2 decision in the Browning-Ferris Industries case still stands. The Browning decision eliminated the requirement that for two employers to be held jointly liable both had to have the right to control the work of an employee and — this is the critical part — actually exercised that control. The Browning decision  did away with the requirement of actual control and instead said employers merely had to have a contractual right to exercise it, a right most employers who use staffing firms have. In addition, the Browning decision said direct control was no longer required; indirect control such as setting work hours would be sufficient.

But in December, the Board, again by a 3-2 vote, reversed itself and reinstated the old rule requiring the exercise of actual control.

Today, the board issued an order vacating its decision in that case, Hy-Brand Industrial Contractors. The order briefly explains why: “The Board’s Designated Agency Ethics Official has
determined that Member Bill Emanuel is, and should have been, disqualified from participating in this proceeding.”

On February 9, NLRB Inspector General David Berry wrote the board a memo saying, “I have determined that there is a serious and flagrant problem and/or deficiency in the
Board’s administration of its deliberative process.” His 5-page memo, which has a section redacted, said the way the board majority, and in particular its former chairman, Philip A. Miscimarra, handled the Hy-Brand case essentially made it a repeat of Browning-Ferris.

“The manner in which the former Chairman marshaled Hy-Brand through the Board’s deliberative process effectively resulted in a consolidation of the two matters into one ‘particular matter involving specific parties.’ In short, the practical effect of the Hy-Brand deliberative process was a ‘do over’ for the Browning-Ferris parties,” Berry wrote, citing an October 2017 email Miscimarra sent to the two other board members who would later vote to overturn Browning. The contents of the email have been deleted from Berry’s memo.

“Because of the level of the incorporation of the Browning-Ferris dissent into what became the Board’s decision in HyBrand, it is now impossible to separate the two deliberative processes. Rather, the Board’s deliberation in Hy-Brand, for all intents and purposes, was a continuation of the Board’s deliberative process in Browning-Ferris,” Berry wrote. And because board member Bill Emanuel’s former law firm had participated in the Browning case (on the losing side), he should not have participated in the Hy-Brand case, Berry said.