Federal Labor Ruling Expands Definition of “Joint Employer” in Browning-Ferris Industries of California

A landmark ruling by the National Labor Relations Board (NLRB) in the Browning-Ferris Industries of California case vastly expands the definition of corporate employee by redefining “joint employer,” providing additional protections for millions of workers.  This decision is a win for workers because it expands the number of entities that can be considered joint employers and prevents employers from evading responsibility through use of subcontractors or franchisees.  The NLRB describes the impetus for the rule change as follows:  “With more than 2.87 million of the nation’s workers employed through temporary agencies in August 2014, the Board held that its previous joint employer standard has failed to keep pace with changes in the workplace and economic circumstances.”  The NLRB will continue to apply the joint employer test: (1) whether both entities are employers under common law;  and (2) whether both entities share essential terms and conditions of employment.  However, the NLRB will now consider as a factor whether an employer has exercised control over terms and conditions of employment indirectly through an intermediary, or whether it has reserved the authority to do so.  The decision can be read here.