The legalities of employee mass walkouts vs. the practicalities of avoiding them in the first place

Three central Ohio Sonic restaurants are without employees after their entire staffs walked off the job in protest against new management and its policies.

According to The Scioto Post, employees left a handwritten note on the door, reading in part, "Due to terrible management the whole store has quit. The company has been sold to people that don't give a f*uck about anyone but themselves."

NLRB flip-flops on key independent contractor test

The distinction between employees and independent contractors is one that still confounds employers. It is a vitally important distinction, because key employment laws, such as anti-discrimination laws, wage and hour laws, and labor laws do not apply to independent contractors.

Union membership is on the rise in Ohio; is your business ready?

Union membership numbers for 2018 are out, and while most employers should be encouraged, Ohio employers might think otherwise.

In Ohio, the percentage of workers belonging to unions is at 12.6 percent, up 0.1 percent from 2017. Nationally, union membership sits at 10.5 percent, down ever so slightly from 2017. In other words, Ohio’s union representation is both greater than, and growing faster than, the national average.

Ohio amends its employment laws to limit joint employment for franchisors

As the debate over the meaning of "joint employer" continues to rage at both the NLRB and in the federal courts, Ohio has jumped into the debate by passing legislation to limit this definition under various Ohio employment laws.

Effective yesterday, franchisors will not be deemed joint employers with their franchisees unless:

• the franchisor agrees to assume that role in writing or a court of competent; or
• a court of competent jurisdiction determines that the franchisor exercises a type or degree of control over the franchisee or the franchisee's employees that is not customarily exercised by a franchisor for the purpose of protecting the franchisor's trademark, brand.

NLRB reverses course and restores some sense to its concerted activity rules

The NLRB is the federal agency that saw the widest expansion of employee rights during the Obama presidency. And the doctrine that expanded the most was the Board's definition of protected concerted activity.

In Whole Foods Market, the NLRB had previously held that "activity by one individual is deemed concerted if undertaken in an effort to enforce the provisions of a collective-bargaining agreement or in order to initiate or induce group action." In other words, a lone wolf could act in concert with other employees based solely on his or her intent to do so. This rule lead to some absurd results.

Last week, in Alstate Maintenance LLC [pdf], the Board restored some much needed sanity to the definition of "concerted" for the purpose of protected concerted activity.

There's a new sheriff in town at the NLRB

Last week was a big one at the National Labor Relations Board.

First, the Board announced its intent to modify its joint employer standard. This move, while not unexpected, is nevertheless significant. You can read all of the backstory on this issue here.

Compliance-by-carrot trumps compliance-by-stick

Democratic administrations are about enforcement.
Republican administrations are about education.

The endgame is still enforcement, but each side approaches this goal very differently.

This dichotomy might be an oversimplification, but, in at least in contrasting the Obama Administration to the Trump Administration, it is very true.

Can you lawfully fire an employee who writes "whore board" to protest a new overtime rule?

In Constellium Rolled Products Ravenswood, LLC, the NLRB held that an employer unlawfully fired an employee who wrote "whore board" on an overtime sign-up sheet.

How is this unlawful? Let's explore.

NLRB clarifies its new employee handbook rules

Late last year, in Boeing Co., the NLRB rewrote more than a decade of precedent by overturning its Lutheran Heritage standard regarding when facially neutral employment policies violate the rights of employees to engage in concerted activity protected by section 7 of the National Labor Relations Act.

The Board scrapped Lutheran Heritage‘s “reasonably construe” test (a work rule violates section 7 if an employee could “reasonably construe” an infringement of their section 7 rights) with a test that balances “asserted business justifications and the invasion of employee rights” by weighing “(i) the nature and extent of the potential impact on NLRA rights, and (ii) legitimate justifications associated with the requirement(s).”

The greatest book ever written about labor relations is…

Last week I came across an article entitled, “Business Wisdom From 10 Classic Children’s Books.” Its premise is that books with the simplest language often contain the most complex ideas, and that children’s books offer us a whole lot of real-world business wisdom.

I was surprised, then, when I discovered that this list omitted the number one book ever written about labor relations—Click Clack Moo, Cows That Type.

SCOTUS decision on class action waivers is not the epic win for employers it may seem to be

Yesterday, in a narrow, 5-4 partisan decision, the Supreme Court issued its most anticipated employment decision of its current term, Epic Sys. Corp. v. Lewis [pdf]. The Court reconciled six years of debate between split federal circuits into a unified standard that permits the waiver of class actions via the compelled individual arbitration of employment disputes.

I’m lovin’ it: McDonald’s settles joint employer case with NLRB

It has been nearly four years since the NLRB filed complaints against McDonald’s, seeking to hold it liable as a joint employer for the unfair labor practices of its franchisees. I have suggested that “if franchisors are equal under the National Labor Relations Act with their franchisees, then we will see the end of staffing agencies and franchises as a viable business model.”

In the interim, the NLRB has flip-flipped on its joint employment standard several times, and this very important area of the law has been in flux.

Now comes word that the NLRB and McDonald’s have reached an 11th hour settlement.

What the hell is going on at the NLRB with joint employment?

Photo by Cameron Kirby on Unsplash

If you are a small business owner, pay attention. Today’s update on the issue of joint employment will be one of the most important things you read this year.

Joint employment has been on a bit of a roller coaster ride at the NLRB over the past few months.

Today, I’m going to sort it all out for you, and try to explain where we might be headed next.


What is Joint Employment?

Joint employment is the sharing of control and supervision of an employee’s activity among two or more business entities, such that each is liable for the legal wrongs of the other to its employees (e.g., discrimination, wage and hour, OSHA, unfair labor practices…). It’s what would hold a franchisor liable for the wrongful acts of its franchisee, a contractor for its sub, and a business for its staffing company.

What are the Historic Joint Employment Rules?

For decades prior to August 27, 2015, is was uniformly established that for one entity to be a joint employer with another, it had to exercise direct and actual control over the terms and conditions of the other entities employees. Do they supervise? Are they subject to the same work rules? Can they hire, fire, and discipline? Who pays and how? Who provides benefits? Who assigns schedules and otherwise directs work? If one employer maintains control over these issues, then the other would not have been a joint employer.

Given this strict test, entities such as franchisors and general contractors felt reasonably comfortable that they were not liable for the acts of its franchisees and subs relative to their employees.

What Changed on August 27, 2015? 
Browning-Ferris Industries of Calif. 

In Browning-Ferris, the NLRB ignored and tossed out 40 years of precedent, and expanded the definition of “joint employer” not only to include those that exercise direct and actual control, but also those that exercise indirect control or reserve the potential to exercise control. OSHA and the DOL soon followed suit, and announced similar standards under their respective statutes. Small business owners, as well as other employers, (justifiably) panicked. If a franchisor, for example, is liable for the legal wrongs of its franchisees towards employees that the franchisor does not hire, fire, discipline, pay, or otherwise direct, why franchise at all? Why not just run the businesses, control the liabilities, and cut out the middle man?

December 14, 2017—Meet the New Boss, Same as the Old Boss
Hy-Brand Industrial Contractors

In Hy-Brand, the NLRB expressly overruled Browning-Ferris and restored direct and actual control as the lone test for joint employment:

[W]e overrule Browning-Ferris and restore the joint-employer standard that existed prior to the Browning-Ferris decision. Thus, a finding of joint-employer status requires proof that the alleged joint-employer entities have actually exercised joint control over essential employment terms (rather than merely having “reserved” the right to exercise control), the control must be “direct and immediate” (rather than indirect), and joint-employer status will not result from control that is “limited and routine.”

Bravo. Employers rejoiced.


The Celebration was Short Lived

On February 26, 2018, the NLRB vacated Hy-Brand, restoring Browning-Ferris (and its potential/indirect control tests) as the law of the NLRA on joint employment. Why? Because current NLRB board member Bill Emanuel, one of the three votes in Hy-Brand in favor of overturning Browning-Ferris, was a partner at the law firm that represented Browning-Ferris in 2015. This decision followed the report of NLRB inspector general David Berry earlier this month, which concluded that Emanuel should have recused himself from Hy-Brand, not because Emanuel engaged in anything improper, but because the appearance of a potential conflict should have caused his recusal.


What now?

For now, Browning-Ferris remains the law on joint employment under the NLRA. And, it likely will continue as such, as without Emanuel, the highly politicized NLRB will almost certainly split 2-2 on any rehearing of Hy-Brand.

Browing-Ferris had been pending on appeal and awaiting decision. The D.C. Circuit Court of Appeals, however, dismissed the appeal and remanded the case back the NLRB for disposition consistent with Hy-Brand. You should now expect more litigation over that issue in the D.C. Circuit.

As you can see, this issue is a bit of a muddled mess.

One easy solution is the federal (and bipartisan) Save Local Business Act. It expressly defines a “joint employer” under the NLRA and FLSA as one that—

directly, actually, and immediately, and not in a limited and routine manner, exercises significant control over essential terms and conditions of employment, such as hiring employees, discharging employees, determining individual employee rates of pay and benefits, day-to-day supervision of employees, assigning individual work schedules, positions, and tasks, or administering employee discipline.

It passed the House last November, and now awaits action in the Senate.

This past summer, I asked if joint employment was the issue to unite our divided country. For the sake of America’s small business owner, I certainly hope it does. If you are concerned about this issue (and you should be), call or email your Senator and Congressperson to urge their support of the Save Local Business Act.

NLRB dismisses James Damore charge against Google—complaints about too much diversity are not protected

It is lawful for an employer to fire an employee who complains that his workplace is too diverse? 

According to the NLRB, the answer, at least under federal labor law, is yes, the termination is legal.

NLRB restores sanity to its rules on employee handbooks and joint employment

Last week, the NLRB started making good on its promise to roll back some of its more controversial Obama-era reforms—its assault on employee handbooks and its liberalization of joint employment.

New Year’s Resolutions — NLRB-style

Have you started thinking about your New Year’s resolutions for 2018?

The NLRB’s newly minted general counsel, Peter Robb, has, and employers will be very happy.

The more things change … the NLRB and Weingarten rights for non-union employees

Today, a joke.

“How is the National Labor Relations Board like the weather?”

“I don’t know, Jon, how?”

“If you don’t like either, just wait and they’ll change.”

[groan]

Not my best material, I know. But, it does illustrate an important point, driven home by an Advice Memo [pdf] just released by the NLRB Office of General Counsel on the issue of Weingarten rights for non-union employees.

NLRB offers rare win for employer confidentiality policy

It’s been a rough few years for workplace policies at the NLRB. From communication policies, to social media policies, to conduct policies, to confidentiality policies, the NLRB has, time and again, struck down facially neutral, garden variety employer policies as overly restrictive of employees’ section 7 rights to engage in protected concerted activity under the National Labor Relations Act.

Employer wins on this issue have been few and far between. As a result, when we get a win, it’s reason to celebrate. Well, employers, pop those champagne corks, because earlier this week, in Macy’s, Inc. [pdf], we received just such a win.

When you discover that you employ a Nazi

In the wake of Friday and Saturday’s horrific, evil events in Charlottesville, the twitter account YesYoureRacist posted many riot photos and identified many of the rioters. And, as a result, some have lost their jobs.

UPDATE: Cole White, the first person I exposed, no longer has a job 💁‍♂️ #GoodNightColeWhite #ExposeTheAltRight #Charlottesville pic.twitter.com/sqxSXboKw6

— Yes, You're Racist (@YesYoureRacist) August 13, 2017

Question: Does one participating in a Nazi rally enjoy any job protections from said participation?

Apparently the labor rights of strikers trump the non-harassment rights of employees

There exists only one workplace environment in which a white employee can keep his job after yelling the following at a group of African-American employees.

• “Hey, did you bring enough KFC for everyone?” 
• “Go back to Africa, you bunch of f***ing losers.”
• “Hey anybody smell that? I smell fried chicken and watermelon.”

A gold star for you if you answered a picket line, when the comments are made by striking workers and are directed at a group of replacements crossing said picket line. Or at least this is the majority finding of the 8th Circuit Court of Appeals in Cooper Tire & Rubber Co. v. NLRB [pdf].