Here's the issue put simply: Is Browning-Ferris responsible for the treatment of contracted employees? The decision by the NLRB was yes, but by only a 3-2 vote. This means that all employees of companies contracted by another (like temporary workers), have the same legal rights and protections as those employed by that company.
- Click here for the decision.
- Click here for background from The Hill:
The Obama administration is redefining what it means to be an employer. The National Labor Relations Board (NLRB) on Thursday handed down one of its biggest decisions of President Obama’s tenure, ruling that companies can be held responsible for labor violations committed by their contractors.
While the ruling from the independent agency specifically deals with the waste management firm Browning-Ferris, the so-called “joint employer” decision could have broad repercussions for the business world, particularly for franchise companies. Opponents of the action warn the ruling could hurt businesses as diverse as restaurants, retailers, manufacturers and construction firms, as well as hotels, cleaning services and staffing agencies.
. . . The NLRB ruling is a sharp departure from previous decisions that stated companies were only responsible for employees who were under their direct control. Without the power to set hours, wages or job responsibilities, the earlier rulings held, companies could not be held responsible for the labor practices of the contractors.
But the National Labor Relations Board charted a new course Thursday, saying the old standard is “increasingly out of step with changing economic circumstances.”
One argument made in favor of the decision is that current employment trends suggest more and more people will be temporary workers or contractors in the future. Uber drivers are an example. This decision is meant to guarantee they have the same rights - such as collective bargaining - as regular employees.
For further background:
- NYT: Labor Board Ruling Eases Way for Fast-Food Unions’ Efforts.
- NPR: NLRB Ruling Could Pave The Way For Fast-Food Unions.
- Forbes: Controversial NLRB Ruling Could End Contract Employment As We Know It.
Here's where this story applies to class topics: The National Labor Relations Board was not only created during the New Deal, it was found constitutional in a highly consequential case which redefined "commerce" as including manufacturing and labor. Otherwise the national government has no ability to pass and implement such a law. The NLRB has since been hugely controversial in an ideological sense because conservative business owners tend to oppose its efforts to strengthen workers rights, while liberals support it. The agency is a constant lightning rod and a repeated focus of political dispute. Conservatives - members of the Republican Party - would be happy in getting rid of it - but that has proven tough to do. Instead they've tried to weaken it. They've had better success there.
More on this soon - I think this story might be with us a while.
