D.C. Circuit Court of Appeals

Feel like the government shutdown has reduced news coming out of the federal administrative agencies? If so, January 17, 2019 likely provided a spark to your week. Last Thursday, National Labor Relations Board (“NLRB”) Chairman John Ring issued a letter which served as the most-recent move in the NLRB’s joint employer dance.

In his letter, Chairman Ring responded to the request of two U.S. House of Representatives Democrats that the NLRB withdraw its proposed joint employer rule. As we previously reported, in September 2018 the NLRB proposed to change the standard utilized to determine joint employer status. Under the new rule, an employer could be “found to be a joint employer of another employer’s employees only if it possesses and exercises substantial, direct and immediate control over the essential terms and conditions of employment and has done so in a manner not limited and routine.” If implemented, this rule would reverse the NLRB’s 2015 Browning-Ferris decision, which had overturned 30 years of NLRB precedent.

The House Democrats’ request stemmed from a recent D.C. Circuit Court of Appeals decision that found the NLRB’s 2015 Browning-Ferris decision proper. In Browning-Ferris, the NLRB ruled that it would consider a potential joint employer’s reserved right to control workers and any indirect control exercised. In its decision, the D.C. Circuit “affirm[ed] the [NLRB’s] articulation of the joint-employer test as including consideration of both an employer’s reserved right to control and its indirect control over employees.”

Given the D.C. Circuit’s decision, the House Democrats argued that the NLRB should withdraw its proposed joint employer rule and apply the Browning-Ferris standard.

However, in his January 17 letter, Chairman Ring resoundingly rejected the House Democrats’ arguments. In particular, Chairman Ring asserted that:

  • The joint employer standard the NLRB articulated in Browning-Ferris was neither clear nor affirmed by the D.C. Circuit;
  • “[T]he NLRB has long adhered to a consistent policy of deciding for itself whether to acquiesce to the views of any particular circuit court or whether to adhere to its own view until the United States Supreme Court rules otherwise[;]” and
  • The NLRB “is not compelled to adopt the court’s position as its own, in either Browning-Ferris itself or the final rule on joint-employer status.”

When the D.C. Circuit released its decision, some predicted that it would restrict the NLRB’s efforts to restore its prior joint employer test.  Chairman Ring’s letter should give employers some comfort that the NLRB may not feel so restrained.

Nonetheless, only time will tell how the NLRB’s joint employer dance concludes.  In light of the D.C. Circuit’s decision, the NLRB further extended the proposed rule’s notice and comment period (comments due by January 28 and responses to comments due February 11).  Therefore, it will be some time before the NLRB even releases its final rule.