NLRB Decisions: Browning Ferris Industries
In Browning Ferris Industries, (362 NLRB No. 186), the Board addressed whether to redefine its standard used to determine whether two entities jointly employ the same employees. This situation often arises when one employer enters into an agreement with another employer under which the former provides its employees to the latter.
Specifically, the question before the Board was whether BFI Newby Island Recyclery (BFI) and Leadpoint Business Services (Leadpoint) were joint employers of the sorters, screen cleaners, and housekeepers who were being petitioned for representation by their union, the Sanitary Truck Drivers and Helpers Local 350, International Brotherhood of Teamsters. BFI owns and operates the recycling facility at Newby Island and employs roughly 60 employees, most of whom work outside of the facility. Leadpoint provides BFI with workers to sort through materials on conveyor belts inside the facility. BFI and Leadpoint are bound by a temporary labor services agreement. The Union sought to have the Board recognize BFI as a joint employer of the workers who preform duties inside of the facility.
In an attempt to “clearly and comprehensively [explain] its joint-employer doctrine” the Board held that it “may find that two or more entities are joint employers of a single work force if they are both employers within the meaning of the common law, and if they share or codetermine those matters governing the essential terms and conditions of employment.” Therefore, it no longer is sufficient to show that a potential joint employer actually exerts control over the employees’ terms and conditions of employment, but merely that it possesses the authority to do so. Furthermore, the Board no longer requires a joint employer to exercise, or have the authority to exercise, direct control over employees and instead requires only the exercise of, or ability to exercise, indirect control. Finally, the Board recognized that it is possible that a potential joint employer’s control extends only to certain essential terms and conditions of employment. This does not mean that joint-employer status will not be applied, but instead that the joint-employer would be required to bargain with respect only to the essential terms and conditions over which it may exert control.
Applying this determination to the facts of the case, the Board held that BFI is a joint employer of the affected employees for multiple reasons. First, it possesses significant control over who Leadpoint can hire to work at the facility and it has the right to reject or discontinue the use of employees hired by Leadpoint. Secondly, BFI has unilateral control over working conditions and productivity standards at the facility. Finally, BFI prevents Leadpoint from paying the affected employees a higher wage than BFI’s employees who perform comparable work.
Why this decision is important for you: This decision is significant for any private sector union which represents employees whose terms and conditions of employment fall under the control of multiple employers. If any of your members fall in this category, they have the right to bargain collectively with each employer that exercises such control over them. The Board’s ruling provides a much less strict standard for determining joint-employer status, and potentially expands your members’ rights. If you believe that any employer with whom you are not already a party to a CBA is exercising control over your members’ terms and conditions of employment, or if this scenario should arise in the future, please contact us for a complete legal review.