The issue of joint employer has been frequently discussed in the labor & employment law circles, and even the media, since the National Labor Relations Board (“NLRB” or “the Board”) issued its 2015 decision in Browning-Ferris Industries, 362 NLRB No. 186 (2015). The issue has had so much attention that a bill, H.R. 3441, has been introduced in the Republican dominated Congress to overturn the decision before the appellate courts rule on the legality of the NLRB’s reinterpretation of the joint employer standard. It would normally be safe to assume that a decision on the issue of joint employer by the D.C. Circuit Court of Appeals (“Court”) would be consequential, but, due to procedural issues in this case, the opinion leaves the standard in place for now.
In CNN America, Inc., No. Civ. 15-1112 (D.C. Cir. August 4, 2017), the court addressed a long-running case involving CNN and its camera operators and technicians who were terminated and subject to a re-hiring process in 2003. Since shortly after its inception, CNN used contractors to staff its technical employees, who were represented by a union. However, around 2003, CNN decided to bring its technical staff in-house as employees. CNN hired some, but not all, of the former contractors as its own in-house employees. In response to CNN’s actions, the union of the former contractors claimed that CNN violated the NLRA. After a complaint issued against CNN in 2007, an opinion was handed down by an NLRB Administrative Law Judge (ALJ) in 2008, which the NLRB largely affirmed in 2014. The matter finally came before the Court on appeal in 2017. The court, in an opinion written by none-other-than Judge Merrick Garland, partially remanded and partially affirmed the NLRB’s decision.
The NLRB had found that CNN engaged in unlawful behavior during the process of terminating the agreement with the contractor and hiring the in-house staff by (1) terminating the agreement as a joint employer with the contracting company to rid itself of the union-represented employees, (2) failing to hire former contractors based on their union status, and (3) failing to recognize and bargain with the union as the representative of its newly-minted in-house employees. On the latter issues, the court affirmed the NLRB’s findings primarily based on the Board’s factual evidence regarding CNN’s hiring process, which showed a desire to avoid hiring union members when staffing its new in-house technical employees. In addition, the Board found that, in terminating the agreement with the contracting company, CNN had violated the Act because it was a joint employer with the contractor at the time it terminated the agreement.
On the issue of joint employer, the Court essentially remanded the matter to the NLRB to “re-do” its analysis. The court reviewed the Board’s law on joint employer and found that its precedent at the time of the decision required a finding that a putative joint employer had “direct and immediate control” over employees technically employed by another company. However, the Board in CNN skipped over this issue and found that CNN and the contractor were joint employers based on the “share or codetermine” test that required only indirect control. This test, which is less stringent than the “direct and immediate control” test, was adopted by the Board in Browning Ferris Industries, which was issued after CNN. The Court found it interesting that, after it rendered its decision in CNN, the Board engaged in a rigorous review of its joint employer standard in Browning Ferris Industries and, ultimately, the Court found that the prevailing standard at the time was the “direct and immediate control” standard. Therefore, the Board in CNN had, without analysis, disregarded the contemporary standard and used the lesser “share or codetermine” test to find CNN was a joint employer with its former contractor.
The court remanded the case back to the Board because it, like all administrative agencies, could not change the joint employer standard without providing an explanation for the change in the law. On remand, the court directed the Board to provide an explanation for its deviation from the then-existing standard or utilize that “direct and immediate control” standard in rending its decision.
In the end, we will all need to wait for the Court to render its decision in Browning Ferris Industries for any actual developments in the law of joint employer under the NLRA.
Andrew MacDonald is an associate in the firm’s Labor and Employment Department, resident in its Philadelphia office.