Saturday, January 26, 2019
Yesterday, the NLRB issued a decision in the SuperShuttle DFW case, providing yet another analysis to determine whether an individual is an employee or independent contractor under the NLRA. The Board's new approach is basically just to adopt the D.C. Circuit's test from the 2011 FedEx case, which I've examined (and criticized) elsewhere. That test relies most heavily on whether the worker has "entrepreneurial opportunity."
As a preliminary matter, it is important to remember that the Supreme Court has held multiple times that when a statute lacks a meaningful definition of "employee," the common-law "right-to-control" test for determining whether someone is an employee or independent contractor should apply. The Court, in Roadway Systems, explicitly held that the NLRA is one of those statutes. So the question for the NLRB is to determine what the common-law test requires.
Note that the analysis is not referred to as the "common-law 'entrepreneurial opportunity'" test. That's because, for its long history, that test has stressed that the most important factor is the purported employer's right to control the manner and means of work of the purported employees. Entrepreneurial opportunity may be relevant, along are numerous other factors, but the right to control is the focal point of the test (I'm actually being generous here because entrepreneurial opportunity isn't explicitly a factor in the common-law test, although other factors hint at a similar concern). In fact, in an ironic twist, the D.C. Circuit just last month stressed this exact point with regard to the NLRB's joint-employer test. In that case, the D.C. Circuit gave a pretty strong warning that the Board needs to be careful not to stray too far from the common-law's focus on right-to-control.
Despite all of this, in SuperShuttle, the NLRB adopted a D.C. Circuit test that makes entrepreneurial opportunity the overriding concern in the analysis. The NLRB downplayed that that's what the D.C. Circuit did, but that interpretation is just wrong. The court held, among other things, that it was "shift[ing the] emphasis’ away from the unwieldy control inquiry in favor of a more accurate proxy: whether the ‘putative independent contractors have significant entrepreneurial opportunity for gain or loss.’" And that shift, to my mind, is indefensible.
You'll note that SuperShuttle has exactly zero citations showing judicial support for the notion that entrepreneurial opportunity is an "important animating principle" of the common-law test other than the D.C. Circuit's decisions. Those decisions, in turn, elevated entrepreneurial opportunity based on an erroneous (one might even say disingenuous) interpretation of the common law. There is simply no reasonable way to say both that the NLRB uses the common law test and that the test's primary focus is entrepreneurial opportunity. The first proposition, as the Board majority itself acknowledges, is undoubtably true; the second is just as clearly untrue. (Member McFerran makes the same point in her dissent.) The common-law test simply does not consider entrepreneurial opportunity as a key principle. Indeed, a closer question is whether it considers it at all. Thus, the Board could reasonably argue that entrepreneurial opportunity should be the animating factor, but it can't make that happen without defying the Supreme Court's clear mandate that when Congress doesn't provide a meaningful definition of "employee," the common-law test applies.
As bad as the NLRB's and D.C. Circuit's manipulation of the common-law test's history is, if that's all that was going on, this might not have too big of an impact. But it's not. What I view as the biggest practical effect of the D.C. Circuit's standard is how it define entrepreneurial opportunity. In particular, the court would allow a business to classify a worker as an independent contractor based simply on theoretical entrepreneurial opportunity, even if it is virtually impossible to take advantage of in practice. This means that businesses can manipulate their agreements with workers to give the appearance of entrepreneurial opportunity, while ensuring that workers lack any genuine opportunity to act like anything but employees. In SuperShuttle, the Board didn't explicitly get into this question, so it's not entirely clear how close they're going to hew to that aspect of the D.C. Circuit's approach, although the Board implied that they were doing the same thing, particularly by failing look into whether drivers had any real ability to use their vans for other work. But the reason why they didn't address this issue may be more disturbing. The Board failed to consider whether the drivers had the option to sell their services to other business--something that is a key characteristic of an independent contractor. Instead, the Board merely stressed that the drivers had control over how much they would work for SuperShuttle and, therefore, how much they earn. You know who else controls how much they earn by determining how much they work? Virtually every hourly and piece-rate employee (albeit with varying ability to control their hours).
Finally, one other significant impact of SuperShuttle was to reject the Obama Board's test in another FedEx decision (see a trend here?), in particular its use of economic dependency. On this point, I'm in agreement with the current Board. While I prefer a more expansive test that considers economic dependency, that's not what the Board should be using. Again, the Court has said that statutes like the NLRA with no real definition of "employee" should use the common-law test. That test doesn't stress economic dependency, unlike the test under the FLSA and FLRA, which have statutory language that suggest a broader classification. So while as a policy matter I prefer using economic dependency, that's not what the NLRB should be doing. The way to fix this is for Congress to better define "employee" or for the Supreme Court to move away from its common-law default.
In sum, SuperShuttle is a a vey poorly reasoned decision, no matter what you think the best test should be from a policy perspective. What will be interesting is to see how the SuperShuttle test fares in the circuit courts. I suspect some circuits are going to squarely reject the new rule, while some may approve. Even more interesting will be the D.C. Circuit's take. The court will have to grapple with its equally bad FedEx decision, which seems to run directly counter to its recent holding on the joint-employer issue, not to mention explicit Supreme Court precedent.
Friday, January 18, 2019
The Wall Street Journal reports today that data from the Department of Labor show union density continuing to fall. Total density in 2018 was 10.5%, down from 10.7% in 2017. Density in the public sector fell from 34.4% to 33.9%). Here's a link to the DOL BLS press release with links to the relevant tables; below is an excerpt from the WSJ article:
The overall rate of union membership in the U.S. fell last year, largely reflecting a decline in the rate of state employees’ unionization, according to the latest Labor Department data.
The union membership rate, or the percent of wage and salary workers who were members of unions, dropped to 10.5% in 2018 from 10.7% a year earlier, the Labor Department said Friday.
The decline stems mainly from a decrease in union membership among state employees, whose membership rates fell to 28.6% in 2018 from 30.3% a year earlier.
Tuesday, January 15, 2019
Among the many NLRB doctrines that have swung in various directions is the one in which an individual employee's actions or words may be concerted activity protected by Section 7 of the NLRA. The Meyers I and Meyers II cases are the foundation for this doctrine, but we've seen many subsequent Board decisions applying the doctrine in different ways depending on the Board members involved. This week's decision in Alstate Maintenance continues that trend, as the full Board (well, the current four members at least) purports to "begin the process of restoring the Meyers standard." Maybe I'm missing something, but it seems to me that, purely from a doctrinal perspective, that statement is an overreach and the decision is a bit of tempest in a teapot.
Under the Meyers standard and related cases, the General Counsel can show that an individual employee is engaging in concerted activity if the employee was attempting to initiate or to prepare for group action, or if the employee was engaging with or on behalf of a group of employees (there are other ways as well, such as enforcing rights under a collective-bargaining agreement). The Board doesn't attempt to alter these underlying rules, but instead goes all in for a stingy interpretation of individual-concerted activity. In essence, the Board distinguished cases where it felt it could do so, and overruled the one case that it believed to be too much of an impediment (WorldMark by Wyndham). In particular, the Board rejected statements in that case that an employee who protests in a group meeting in engaging in concerted activity by attempting to intimate group action and that complaining in a group setting is necessarily concerted activity (the dissent disputes this characterization of WorldMark). Instead, the Board in Alstate reiterated the need to engage in a fact-specific inquiry under Meyers II. The money quote is:
Rather, to be concerted activity, an individual employee’s statement to a supervisor or manager must either bring a truly group complaint regarding a workplace issue to management’s attention, or the totality of the circumstances must support a reasonable inference that in making the statement, the employee was seeking to initiate, induce or prepare for group action. Consistent with Whittaker and Chromalloy Gas Turbine, relevant factors that could tend to support drawing such an inference include that (1) the statement was made in an employee meeting called by the employer to announce a decision affecting wages, hours, or some other term or condition of employment; (2) the decision affects multiple employees attending the meeting; (3) the employee who speaks up in response to the announcement did so to protest or complain about the decision, not merely (as in WorldMark) to ask questions about how the decision has been or will be implemented; (4) the speaker protested or complained about the decision’s effect on the work force generally or some portion of the work force, not solely about its effect on the speaker him- or herself; and (5) the meeting presented the first opportunity employees had to address the decision, so that the speaker had no opportunity to discuss it with other employees beforehand.
 We do not hold that all these factors must be present to support a reasonable inference that an employee is seeking to initiate or induce group action. In keeping with Meyers II, the determination of whether an individual employee has engaged in concerted activity remains a factual one based on the totality of the record evidence. . . .
One thing that's odd about this case is that it involved not only an employee's comment (a skycap who initially stated that a group of skycaps had helped a similar group arriving at the airport previous and didn't receive a tip) but also a partial work stoppage (the employee and others refused to help the new group). Alas, the GC only focused on the comment, although one might wonder why the fact that group action actually occurred did play a bigger role in the Board's analysis. Nevertheless, I don't see Alstate as making any major, substantive changes to the Meyers standard. Rather, it seems to be an example of a restrictive reading of Section 7 that we'd except from a Republican Board, announced in a way to send a message to parties about what it's doing. That said, as Michael Duff emphasized to me, even if the doctrine isn't effected much, this can have real impacts on employees who are protesting conditions at work.
Wednesday, January 2, 2019
The American Federation of Government Employees has initiated a suit on behalf on of two federal corrections officers who have not received earned overtime pay. The class is likely to grow substantially if the shutdown continues past Jan. 5, as that's the next regularly scheduled payday. Indeed, it is estimated that over 400,000 employees have been deemed essential and are required to continue working during the shutdown.
Like a similar suit brought during the 2013 shutdown by the same law firm--Kalijarvi, Chuzi, Newman & Fitch--the employees are claiming FLSA violations. What I hadn't realized is that despite a win in the 2013 suit, 25,000 employees still haven't received damages (they were awarded liquidated/double damages). If anyone knows why, I'd love to hear it. In any event, the prospect of double damages for over 400,000 employees for heaven knows how many hours of work would, I hope, give politicians extra incentive to get this resolved. That said, no matter how big an FLSA award might be, it still pales in comparison to a $5 billion wall . . . .
Monday, December 31, 2018
The D.C. Circuit has just ruled on the NLRB's Browning-Ferris joint-employer test, largely approving the standard that made many on the employer-side of things apoplectic. In Browning-Ferris v. NLRB, the court approved of the joint-employer rule, but remanded because it held that the Board didn't apply part of the rule correctly. This issue is becoming increasingly convoluted, so let me break down some of what's going on.
- Why did the court decide this case in the first place? As we've been following, the Board has already reversed the Browning-Ferris test once, which they had to vacate because of a recusal issue. They are now in the process of reversing course via rulemaking. Despite that, the Board asked the court to decide the case, which the majority readily agreed to do, over a dissent. The reason the court did this brings me to the second point.
- De novo review for the joint-employer test. The court emphasized that determination of the Board's joint-employer rule is reviewed de novo. Because the joint-employer standard is based in common law, according to the court, no deference to the agency is required (as opposed to application of the standard, which is a mixed question of law and fact). And because the court wasn't giving the Board any deference, the court determined that there was no need to wait for the Board's new rule. Note that this is not good news for the Board's draft joint-employer rule, although may be good news for those who prefer a more consistent rule over the long-term.
- Reserved and indirect control is relevant to joint employment. As a reminder, the big argument is whether and to what extent the joint-employer test should consider reserved and indirect control. Browning Ferris said that actual and direct control is not required; the current Board disagrees. In this case, the court was crystal clear that the argument made by the employer and dissenters in Browning-Ferris that joint employment can be based only on exercised control and direct and immediate control are wrong. Full stop. As the court noted, the common law is riddled with examples and statements that reserved control and indirect control are relevant to joint employer determinations. So this extreme view--that joint employers must have actual and direct control--is currently dead in the D.C. Circuit. But there's a middle ground that may still available, which I'll get to in a moment. But first . . .
- Remand. Despite uphold the Browning-Ferris test, the court held that the Board mis-stepped in this case. In particular, when applying the new rule in this case, the Board didn't make clear whether it relied on evidence on indirect control over essential terms and conditions of work (which is relevant) versus indirect control over "routine parameters of company-to-company contracting," like a cost-plus contract or advance description of tasks (which is not relevant). Thus, the court remanded to the Board to clarify whether there is enough relevant evidence to support a joint-employment finding.
- Meaningful collective bargaining. The court also tacitly approved the Board's inquiry into whether a putative joint employer controls enough essential terms and conditions of employment to permit meaningful collective bargaining, but wanted the Board to define terms of that inquiry more in a case, unlike here, when the Board actually applies invokes that question. That's good news for folks, like yours truly, who have argued for a more collective-bargaining focused joint employer test.
- Finally, the money question: What next? I was talking this morning to Robert Iofalla at Bloomberg News (I will link to his article when it comes out), who is exploring this question. One option is that the Board will press an extreme position during its rulemaking and thumb its nose at the court's admonition that reserved and indirect control is relevant (which could then lead to the Board's nonacquiescence policy, possible circuit split, and cert. petition). But my guess--and I stress guess--is that the Republican majority of the Board will go as far as it can without directly conflicting with the court's decision. In other words, as it did in Hy-Brand, the Board could acknowledge that evidence of reserved or indirect control can be relevant. And, then, it can answer the questions that the court expressly left open: whether only indirect and/or reserved control is enough to find joint employment. The current Board will obviously say "no," which will leave us with basically the same test we had before Bronwing-Ferris. The Board could still lose when the D.C. Circuit or another court takes up that question, but this seems to be a lower risk strategy than going the extreme route. The "relevant-but-not-sufficient" strategy still leaves plenty of room for a narrow joint employer test, especially when a Trump Board is applying it, while avoiding the time-consuming litigation that would result from defying the D.C. Circuit and seeking a circuit split. Avoiding these types of risks are especially important when the Board is doing something it rarely does by engaging in substantive, formal rulemaking.
Still plenty more to come, so stay tuned.
Friday, November 30, 2018
One of the questions that followed the Supreme Court's Janus decision was whether unions had to give back dues that unions had already collected. Several employees, backed by anti-union groups, sued based on the theory that unions shouldn't be able to keep funds that the Court has announced were unconstitutionally required under collective-bargaining agreements with their public employers. Unions, on the other hand, responded that although the Court had long made clear its intention to overrule Abood and rule this way, clear precedent states that until the Court makes such a change, current caselaw applies. This isn't just an interesting legal question; there is a ton of money at stake for unions.
Yesterday, we got the first judicial decision on this question, in favor of unions. In Danielson v. AFSCME, the Western District of Washington dismissed a lawsuit seeking a declaratory judgment that past-paid fees were unconstitutional and seeking a return of those funds. At the heart of the dismissal was the court's holding that the union involved enjoyed a good faith defense against the Section 1983 claim because when they collected the fees, they were legal under both state and federal law. There's a general understanding among many courts that Section 1983 includes a good faith defense and the court held that it applied here. That's not surprising given that the Supreme Court has been very clear that lower courts should not try to predict what the Court will do--the law is what it is until the Court says it isn't.
This is a significant win for public-sector unions, but this issue isn't over. There are several other identical suits which could well come out differently, and I'm sure this case will be appealed. So stay tuned.
Tuesday, November 6, 2018
The Supreme Court issued its first decision of the term today, and it was the age discrimination Mount Lemmon Fire District v. Guido case. I'll claim credit for predicting a win for the public-sector plaintiffs--minus the fact that I was wrong about saying it wouldn't be unanimous. So, the outcome wasn't a surprise, but the unanimous support for both a group of employees and the Ninth Circuit was. You can read the full opinion here. For lazy readers, here's the syllabus:
John Guido and Dennis Rankin filed suit, alleging that the Mount Lemmon Fire District, a political subdivision in Arizona, terminated their employment as firefighters in violation of the Age Discrimina- tion in Employment Act of 1967 (ADEA). The Fire District responded that it was too small to qualify as an “employer” under the ADEA, which provides: “The term ‘employer’ means a person engaged in an industry affecting commerce who has twenty or more employees . . . . The term also means (1) any agent of such a person, and (2) a State or political subdivision of a State . . . .” 29 U. S. C. §630(b).
Initially, both Title VII of the Civil Rights Act of 1964 and the ADEA applied solely to private sector employers. In 1974, Congress amended the ADEA to cover state and local governments. A previ- ous, 1972, amendment to Title VII added States and their subdivi- sions to the definition of “person[s],” specifying that those entities are engaged in an industry affecting commerce. The Title VII amend- ment thus subjected States and their subdivisions to liability only if they employ a threshold number of workers, currently 15. By con- trast, the 1974 ADEA amendment added state and local governments directly to the definition of “employer.” The same 1974 enactment al- so amended the Fair Labor Standards Act (FLSA), on which many aspects of the ADEA are based, to reach all government employers regardless of their size. 29 U. S. C. §203(d), (x).
Held: The definitional provision’s two-sentence delineation, set out in §630(b), and the expression “also means” at the start of §630(b)’s second sentence, combine to establish separate categories: persons engaged in an industry affecting commerce with 20 or more employees; and States or political subdivisions with no attendant numerosity limitation.
The words “also means” in §630(b) add new categories of employers to the ADEA’s reach. First and foremost, the ordinary meaning of “also means” is additive rather than clarifying. See 859 F. 3d 1168, 1171 (case below) (quoting Webster’s New Collegiate Dictionary 34). The words “also means” occur dozens of times throughout the U. S. Code, typically carrying an additive meaning. E.g., 12 U. S. C. §1715z–1(i)(4). Furthermore, the second sentence of the ADEA’s definitional provision, §630(b), pairs States and their political subdivi- sions with agents, a discrete category that carries no numerical limitation.
Reading the ADEA’s definitional provision, §630(b), as written to apply to States and political subdivisions regardless of size may give the ADEA a broader reach than Title VII, but this disparity is a consequence of the different language Congress chose to employ. The better comparator for the ADEA is the FLSA, which also ranks States and political subdivisions as employers regardless of the num- ber of employees they have. The Equal Employment Opportunity Commission has, for 30 years, interpreted the ADEA to cover political subdivisions regardless of size, and a majority of the States impose age discrimination proscriptions on political subdivisions with no numerical threshold. Pp. 4–6.
In short, if you're an employee plaintiff, it really helps to have a strong textual argument.
Wednesday, October 31, 2018
Thanks to Paul Harpur (U. Queensland - Beirne Law) for sending word that today, the Australian State of Queensland introduced a new Human Rights Bill 2018 (Qld) before Parliament. As Queensland has only one House of Parliament, where the government currently has a majority, it is almost certain this bill will soon become law.
The Human Rights Bill 2018 (Qld) declares that Queenslanders have 21 Civil and political rights and two Economic, social, and cultural rights. Many of these rights are relevant to university students and workers/labour in Queensland. On the labor side, thee rights include:
- Freedom of thought, conscience, religion and belief,
- Freedom from forced work,
- Freedom of expression, and
- Peaceful assembly and freedom of association
On the education side, the right is extended, beyond K-12, to a right to “have access, based on the person’s abilities, to further vocational education and training that is equally accessible to all.” Ability equality is a concept that disability rights scholars across the globe have been arguing for. In Queensland, for example, Paul testified in 2018 to a Queensland Parliamentary Committee, arguing that the United Nations Convention on the Rights of Persons with Disabilities is the declaration of ability equality.
Some recent labor and employment news:
- Wages look like they're finally rising in a significant way. A DOL report showed an almost 3% increase in wages for this time last year, which outpaces inflation and is the highest increase in a decade.
- A couple of joint-employer items. First, the NLRB has extended the time to comment on a proposed new rule to Dec. 13. Also, the tussle between Congressional Democrats and the Board over the proposed change continues. As this Bloomberg Law (subscription required) article details, the Democrats want evidence supporting the claim that the current, broader joint-employer test is causing the problems that critics claim. This touches on a broader area--the NLRB is really bad at using actual evidence to support its policy views. Some of this is the legacy of the ban on economic analysis (which is so stupid--why in the name of all that is rational can't we have a bipartisan agreement that analysis is useful for labor law, like, say, the rest of the government?). But some of this, frankly, is just lazy. There's nothing stopping the Board from citing others' studies, which it does far less that it could. And this is an equal-opportunity offense. Although some members have been better on this, Board from both parties tend to be woefully inadequate on this score.
- As is the case when the White House changes parties, the DOL has been adjusting how it regulates union finance requirements. Unsurprisingly, they're ratcheting up the requirements by increasing the number of entities covered and expanding what covered entities need to provide. This is shades of the Bush II administration, where the changes were challenged in court. Expect the same here.
- The General Counsel has announced that it's changing its approach to allegations of union negligence. In contrast to the long-standing deferential approach the Board has taken, the GC says he will now prosecute unions for negligence under Section 8(b)(1)(A) (for failure of the duty of fair representation) when it does things like lose a complaint or fails to return a call.
Tuesday, October 16, 2018
Amazon has long been known as a high-tech Moneyball employer, striving to make data-driven decision when possible. But this week shows that there are limits to that approach. After working since 2014 to develop AI-driven hiring algorithms, Amazon recently abandoned that approach. The reason? The algorithms were biased against women. This is an issue that several folks, including Rick Bales, have been talking about (and is a small part of a larger tech project I'm working on), and isn't a surprise given the dearth of women in the tech industry. This is the classic garbage-in-garbage-out issue. Amazon was training its algorithms based on resumes it has received, and because men disproportionally applied to the company, the algorithms were spitting out decisions that undervalued women; indeed, they were specifically penalizing resumes that included references to women. If Amazon or other companies want to use AI (really Machine Learning) for hiring, they should first use the technology to analyze its current hiring practices to try to root out pre-existing bias. Only once that's addressed does AI have even the hope of being effective.
To be clear: Amazon says that it never actually used the algorithms for actual hiring decisions. It wasn't for a lack of trying though. Amazon realized what was going on in 2015, but didn't disband the program until the start of last year. In other words, despite working for quite a while to eliminate the bias, they couldn't do it to their satisfaction. That a company like Amazon couldn't pull this off should serve as a strong warning to everyone about the limits of AI. I'm actually more optimistic on AI's eventual potential to reduce employment discrimination than many, but I am still extremely cautious about the technology. There's definitely a right way and wrong way to use it and, as Amazon shows, the right way can be really hard. As a result, I think the greatest risk of AI in personnel decisions is its misuse by companies that are too lazy, cheap, or blinded by the shiny object that is AI to realize that is is only a tool and, like other tools, can be used the wrong way.
Tuesday, October 9, 2018
Last week (yeah, I'm still catching up), the Supreme Court heard oral arguments in Mount Lemmon Fire District v. Guido. It's one of those technical cases that hinges on textual question's about the ADEA's definition of "employer." In particular, at issue is whether the ADEA's usual 20-employee small employer exception applies to government employers. There's no question that the exception applies to private employers, but because of the way the provision is written, its application to public employers is less clear. Because the text is so important, let me quote the relevant part (Sec. 11(b)):
(b) The term “employer” means a person engaged in an industry affecting commerce who has twenty or more employees for each working day in each of twenty or more calendar weeks in the current or preceding calendar year: Provided, That prior to June 30, 1968, employers having fewer than fifty employees shall not be considered employers. The term also means (1) any agent of such a person, and (2) a State or political subdivision of a State and any agency or instrumentality of a State or a political subdivision of a State, and any interstate agency, but such term does not include the United States, or a corporation wholly owned by the Government of the United States.
As you can see, the small-employer exception is in a separate sentence from the sentence that includes public employers under the ADEA. That's what the plaintiffs stress and the 9th Circuit held. But four other circuits went the other way, holding that "person" includes public employers. Charlotte Garden's (Seattle) provided an argument analysis in SCOTUSblog. Although she's too wise to make a prediction, I'm going to go out on a limb and say that I think the plaintiff is going to win this one. Not unanimous, but questions from some of the conservative justices (e.g., Roberts) makes me think that the more grammatical reading of the text is going to win the day. Also, I hope someone mentions to Justice Alito that if the Court is going to align the ADEA's coverage to Title VII's simply because they were enacted a couple of years apart from each other, then the Court needs to overrule all of its cases where it expressly rejected that argument when it came to interpreting the 1991 Civil Rights Act Amendments (e.g., Nasser and Gross).
Tuesday, October 2, 2018
Robert Iofalla at Bloomberg Law has an interesting article out today looking at the number of times the NLRB's new joint-employer test in Browning-Ferris has been applied. As readers know, there has been a lot of handwringing over this test. But according to the article, it's been applied in only 14 out of almost 1,100 ALJ and Regional Director cases since it was issued in 2015. But it's unclear what that figure means.
As the article points out, there are two ways to look at this. On one hand, it may mean that Browning-Ferris isn't that big of a deal and that employers easily adjusted to the new standard or, as was likely the case for the majority of businesses, the changed standard didn't affect them in the first place. On the other hand, the number of cases invoking Browning-Ferris doesn't capture its full impact, as businesses may have made significant changes to stay in compliance. I suspect there's truth to both views. For instance, the 14 cases almost certainly doesn't capture the new rule's full impact; it's impossible to believe that far more businesses didn't at least have Browning-Ferris as a consideration when making relevant decisions since 2015. However, this also reflects that the histrionics that followed Browning-Ferris--predicting the demise of franchising and the like--were grossly exaggerated. As the Board explained in Browning-Ferris, it was returning to an earlier version of the joint-employer rule and the changes it made from the immediately prior standard were not so great that it would fundamentally change business models like franchising.
Time may tell whether we'll see further evidence of Browning-Ferris' impact. Or not, if the tea leaves are correct that the NLRB will reverse it soon.
Two Fight for $15 stories today. The first is that Amazon has agreed to pay all of its U.S. workers at least $15 an hour. Notably, this includes part-time and temp workers. Effective November 1, this change is expected to apply to 350,000 workers (although I can't find a number on the number of those workers who currently make less than $15 an hour). Amazon is also raising pay in Britain. This follows other increases or promised increase by major companies like Target, but given Amazon's size and profile, it's unsurprising that this is making a bigger splash.
In related news, the Fight for $15 movement has organized a series of national walkouts, rallies, and protests from October 2-4. The aim of these actions are for higher pay and to help candidates that support labor rights. Its still early, but thus far some of the more notable actions seem to be focused in the Midwest, although there are certainly others as well.
Thursday, September 27, 2018
As we noted earlier, the NLRB has signaled another flip in its approach to regulating employees' use of employer email systems for NLRA-protected communications. This pending case, Rio All-Suites Hotel & Casino, has also gotten entangled with the now-frequent battles over NLRB Member recusals. In Rio, several senators wrote to Chairman Ring expressing concern about the participation of Member Emanuel, whose former firm--Littler Mendelson--continues to represent the employer in Purple Communications. Purple is the case that the Board is threatening to reverse in Rio; indeed, Purple is still being litigated. Well, sort of. The Ninth Circuit just granted a motion to pause the appeal until the NLRB issues its Rio decision. Thus, the concern over recusal. Chairman Ring recently responded to the senators' letter and, without staking out a position, stressed both that the NLRB would follow its usual procedures on recusals and would keep an open mind on the issues in Rio.
With that open mind in mind, I have submitted an amicus brief in the case. As I stress in the brief, I think the legal precedents governing email usage are crystal clear, but I'm not holding my breath about the what the Board does.
Wednesday, September 26, 2018
Yesterday, the Ninth Circuit issued its decision in O'Conner v. Uber, a class action that centered on drivers' claim that they should be classified as employees. The Ninth Circuit reversed the district court's order to certify the class action, holding that the drivers must arbitrate their claims individually because arbitration agreements they signed with Uber prevented class claims. This, of course, is not a surprise, as the Supreme Court essentially forced such an outcome in its Epic Systems case from last term. However, this decision from the Ninth Circuit, contrary to some of the media reports I've seen, does not mean that the drivers lost on the question of whether they should be classified as employees. That question is separate from the arbitration one and, as Charlotte Garden has noted, in California at least, the classification issue looking promising for Uber drivers and other workers who might be on the fence in other jurisdictions.
Uber may discover that they should beware of getting what they asked for because they may soon be facing a lot of individual arbitration claims by its drivers. But we shall see.
Friday, September 21, 2018
Currently, two big strike events are in the news. One has already occurred and the other may be on the horizon.
First was a nationwide strike on Tuesday by some McDonald's employees. This strike was unusual for numerous reasons. One is that we don't usually see low-wage retail workers striking, although the Fast Food 15, OUR Walmart, and other similar efforts have begun to change that norm in recent years. As a result, what stands out most to me was the object of the strike. It wasn't the traditional bread & butter workplace issues like pay, benefits, and hours. Instead, the workers were striking to protest sexual harassment and to demand that McDonald's do more to address the issue. What this strike may be telling us is that there are new norms developing. Norms in which retail workers are more willing to strike and willing to do so for issues that aren't necessarily traditional, but are still vitally important, especially in the current #MeToo environment.
The second, potential, strike is far more traditional. It involves the steel industry, where steelworkers are threatening to strike United States Steel and ArcelorMittal if contract negotiations don't result in raises and other benefits that reflect those company's improving financial footing. An interesting twist is that part of the steelworkers' argument is that after taking many years of wage freezes, they want to share in the improving fortunes brought on in part by the new tax cuts and steel tariffs. An entirely predictable situation, but one that I expect will get settled because those companies won't want production halted.
Thursday, September 13, 2018
In case all of the prior signals weren't enough, the NLRB has now formally announced a "new" proposed joint-employer standard. Although it won't be released until tomorrow, the Board's announcement makes clear that it intends to return to the pre-Browning-Ferris standard. The Board describes this new/old standard (which the Browning-Ferris Board argued was itself a change from an earlier standard) as follows:
Under the proposed rule, an employer may be found to be a joint-employer of another employer’s employees only if it possesses and exercises substantial, direct and immediate control over the essential terms and conditions of employment and has done so in a manner that is not limited and routine. Indirect influence and contractual reservations of authority would no longer be sufficient to establish a joint-employer relationship.
This is a substantial change from the Browning-Ferris standard, which would allow a joint employment finding if employers share governance of essential terms and conditions of employment. Among the factors used for this determination are whether an employer has exercised direct control over terms and conditions of employment indirectly or whether it has reserved the authority to exercise control.
Obviously, the NLRB has to go through the notice and comment period, but the chance of the current Board majority (Member McFerran is dissenting) changing its mind about going back to something like the pre-Browning Ferris standard is about the same chance as my computer spontaneously levitating.
On one level this is just part of the normal ebb and flow that we see with new administrations. What I find more interesting is that the current Board seems to be using rulemaking as a means to make its changes harder to reverse. There's nothing inherently wrong with this--that's what most agencies do, after all--but it represents a significant shift from the Board's usual practice of using decision-making for substantive rules. I'm actually ambivalent about this as a general matter, but I'll be curious to see whether concerns about courts reversing Board rules more frequently than case decisions plays out.
Tuesday, September 11, 2018
The NLRB announced today that it is inviting briefs in Loshaw Thermal Technology and Casale Industries. Both cases involve a lesser-know rule under the NLRA (at least if you're not involved with construction union very often). Section 8(f), among other things, allows an employer and construction union to establish a bargaining relationship without a showing that the union has majority support (this reflects the reality that construction jobs are by their nature usually temporary). This provision essentially establishes a presumption of majority support, albeit one that can be challenged by a valid decertification petition.
In its 2001 Staunton Fuel decision, the Board concluded that parties could transform their bargaining relationship from Section 8(f) to Section 9(a)--the more typical mean of recognition, which usually involves a showing of majority support and is harder to challenge--through a collective-bargaining agreement that clearly states that the union said that it could show that it had majority support. It is that rule that the Board is currently questioning in Loshaw Thermal.
In Casale, the Board is also questioning the time period during which a construction union's Staunton 9(a) recognition can be challenged. Casale stated that an employer only had six months after the collective-bargaining agreement to argue that the union actually lacks majority support.
Sunday, September 2, 2018
Kate Griffith (Cornell, ILR) writes to share the August 2018 Special Issue of the ILR Review, which focuses on workplace conditions and immigration legalization initiatives cross nationally.
Below is an excerpt from the introduction entitled “Introduction to a Special Issue on the Impact of Immigrant Legalization Initiatives: International Perspectives on Immigration and the World of Work,” (authors are Maria Lorena Cook, Shannon Gleeson, Kati L. Griffith, and Lawrence M. Kahn)
“The articles in this special issue draw on studies of legalization initiatives in major immigrant destinations: Canada, Italy, and the United Kingdom. Together they underscore the importance of cross-national perspectives for understanding the range of legalization programs and their impact on immigrant workers, the workplace, and the labor market”
For more from this special issue, which will be free to read for a limited amount of time, click here.
Several labor & employment stories that have been in the news recently:
- The NLRB has extended the time to file briefs in the employee email case, Ceasars Entertainment. The new deadline is October 5. No word yet on why on why the Board decided on the extension.
- The President states that he is going to freeze federal pay, despite an apparent agreement on raises this year. He's using a provision that allows the President to make such actions because of economic exigency.
- The Washington Post has an interesting story on Lewis Hine--the photographer who talked his way into numerous early-1900s workplaces to take pictures of child laborers. Hine's photographs are credited as a major impetus for the FLRA's anti-child labor laws. Check out the Library of Congress collection of his photographs.
- Check out this opinion piece on "two-tier" unions.
And remember, Happy Labor Day tomorrow!