Employment Law Report
NLRB’s Browning-Ferris Industries Decision to be Reviewed by Federal Court of Appeals
In the past two weeks there have been some important developments in the ongoing case against Browning-Ferris Industries of California (“BFI”). Recall that in August 2015, the National Labor Relations Board issued a decision in a union election case filed by Teamsters Local 350 against BFI and its labor contractor, Lead Point Business Services. The Teamsters sought to represent a unit of employees in certain job classifications at a BFI recycling facility in California who were all supplied by Lead Point. The Teamsters’ election petition sought a decision that BFI and Lead Point jointly employed these employees, but the NLRB Regional Director rejected the Union’s position, finding that under NLRB precedent at that time, BFI and Lead Point were not a joint employer. The Regional Director directed an election which was held on April 25, 2014. However, the employees’ ballots were impounded while the Teamsters sought and obtained review of the Regional Director’s decision by the NLRB.
In its August 2015 decision on review, a three member majority of the five member Board overruled the Board precedent relied upon by the Regional Director and found that BFI and Lead Point were a joint employer of these employees. Although Lead Point hired and paid the wages and benefits of the employees, the Board concluded that BFI jointly employed them because it had significant control over: hiring, firing and discipline; supervision, direction of work and hours of work; and wages. In reaching this conclusion, the Board resurrected an old standard for determining joint employer status, namely:
“ . . . statutory employers are joint employers of the same statutory employees if they ‘share or codetermine those matters governing the essential terms and conditions of employment.’ In determining whether a putative joint employer meets this standard, the initial inquiry is whether there is a common-law employment relationship with the employees in question. If this common-law employment relationship exists, the inquiry then turns to whether the putative joint employer possesses sufficient control over employees’ essential terms and conditions of employment to permit meaningful collective bargaining.”
In dissent, the two Republican members of the Board said: “Today, in the most sweeping of recent major decisions, the Board majority rewrites the decades-old test for determining who the ’employer’ is.”
The Board majority ordered the Regional Director to open and count the election ballots. The tally of ballots showed that a majority of employees voted in favor of union representation, and the Regional Director certified the results. However, BFI and Lead Point refused to bargain with the Union so that they could test the certification in an unfair labor practice proceeding in the federal court of appeals. (Board decisions in election cases are not directly reviewable in court, with one narrow exception; generally only unfair labor practice cases are reviewable.) On January 12, 2016, the Board entered summary judgment against BFI and Lead Point, holding that their refusal to bargain violated Section 8(a)(5) of the National Labor Relations Act. This decision is reviewable by a court.
On January 28, BFI and Lead Point filed a Petition for Review in the U.S. Court of Appeals for the District of Columbia Circuit. Under the law, BFI and Lead Point could have filed their Petition for Review in other circuits, including the Ninth Circuit, which has jurisdiction over cases arising in California. However, the Ninth Circuit is known to be liberal, which may be why the D.C. Circuit was chosen. The D.C. Circuit probably also reviews more federal administrative agency decisions than any other circuit in the country. The court likely will not issue a decision until late this year or sometime next year, depending on the court’s docket and other developments. The Teamsters Union has moved to intervene in the court case, and it is likely that various other amicus parties will also wish to participate in this high profile case. This will likely slow the pace of the case.