NLRB Returns to Traditional Common-Law Test For Independent Contractors

By Michelle D. Wyrick

On January 25, 2019, in SuperShuttle DFW, Inc. and Amalgamated Transit Union Local 1338, Case 16–RC–010963, the National Labor Relations Board (“NLRB”) overruled its prior decision in FedEx Home Delivery, 361 NLRB 610 (2014), and returned to the common-law test that it previously used to determine whether workers were employees or independent contractors.  The NLRB’s decision clarifies the role that “entrepreneurial opportunity” plays in deciding whether workers are employees or independent contractors.  The significance is that employees can unionize under the National Labor Relations Act (“NLRA”).  Independent contractors cannot.

The NLRB criticized the FedEx decision because it “significantly limited the importance of entrepreneurial opportunity.”  In SuperShuttle, the NLRB considered whether franchisees who operated shared-ride vans for SuperShuttle Dallas-Fort Worth were employees covered under the NLRA or independent contractors.  The franchisees were required to purchase or lease their own vans (that met franchise specifications), and they paid SuperShuttle Dallas-Fort Worth a franchise fee and a flat weekly fee for the right to use the SuperShuttle brand and its reservation apparatus.  Franchisees paid for their own gas and van maintenance.  The franchisees were not

NLRB establishes new policy governing employee handbooks and workplace policies

By Mitzi Wyrick

In Boeing Co., 365 NLRB No. 154, the National Labor Relations Board (“NLRB”) overturned the standard established in Lutheran Heritage Village-Livonia, 343 NLRB No. 646 (2004) for weighing the legality of employee handbook rules and workplace policies.  In Lutheran Heritage Village-Livonia, the NLRB created confusion for employers when it ruled that employers violated the National Labor Relations Act (“NLRA”) by maintaining workplace rules that did not explicitly prohibit protected activities, were not adopted in response to such activities and were not applied to restrict such activities, if the rules would be “reasonably construed” by an employee to prohibit the exercise of Section 7 rights under the NLRA.

Under Lutheran Heritage, employers were found to have violated the NLRA for having seemingly innocuous policies prohibiting “loud, abusive or foul language,” rules subjecting employees to discipline for an “inability or unwillingness to work harmoniously with other employees,” and rules prohibiting “negative energy or attitudes.”  Confusingly, under Lutheran Heritage, some rules

Sixth Circuit denies request to reconsider Hardin County’s “right to work” ordinance

By Courtney Samford

Last week, the Sixth Circuit denied a request by several collective bargaining organizations to rehear a challenge to Hardin County, Kentucky’s “right to work” ordinance.  The union challengers, including the ALF-CIO, argued that the county ordinance was preempted by the National Labor Relations Act (“NLRA”).  More specifically, they claimed that Hardin County’s ordinance was preempted by the NLRA, which only permits “State or Territorial” laws prohibiting security agreements between employers and unions.  The County, on the other hand, took the position that its ordinance was valid because it was a political subdivision of the Commonwealth of Kentucky.  The lower court found in favor of the union plaintiffs and struck down the ordinance.

Hardin County appealed to the Sixth Circuit, and a three-judge panel reversed the lower court’s ruling, finding that “State or Territorial” laws include ordinances passed by

Persuader Rule Update

By George J. Miller

By now, I assume most employers and others who keep up with developments in labor and employment law are familiar with the U.S. Department of Labor’s (DOL) controversial “persuader rule” that was set to take effect on July 1 of this year.  For those who are not familiar with it, here is a summary of what all the fuss is about, followed by some recent court developments.

In 1959, Congress amended the National Labor Relations Act (NLRA) by passing the Labor Management Reporting and Disclosure Act (LMRDA).  The main purpose of the LMRDA was to rid organized labor of corruption and also make it more democratic.  However, the LMRDA also requires labor consultants (including lawyers) to file reports with the DOL identifying their employer clients and the details of the terms of their engagement, including fees paid for their services, if an object of the engagement, either directly or indirectly, is to persuade employees whether or how to exercise or not to exercise their rights to organize or bargain collectively under the NLRA.  The law also requires employers who engage consultants for such purposes to file a similar report.  These filings are a public record.  Willful violations of the LMRDA’s reporting requirements are criminal and are punishable by a fine of up to $10,000 or a year in jail, or both.

However, the LMRDA contains an exception from the reporting requirement for consultants’ “advice” to employers in such matters.  Shortly after the LMRDA was enacted, the DOL issued guidance stating that if a labor consultant (including an attorney) did not communicate directly with employees regarding their

National Labor Relations Board Dismisses Northwestern University Football Players’ Petition to be Classified as Employees and Unionize

By R. Joseph Stennis, Jr.

On August 17, 2015, the National Labor Relations Board (“NLRB”) unanimously dismissed a petition by Northwestern University’s football team players to be categorized as “employee(s)” as that term is defined under the National Labor Relations Act (“NLRA”). The NLRB declined to assert jurisdiction over the matter and instead dismissed the representation petition that was successfully filed by the College Athletes Players Association (“CAPA”) last year in which Peter Sung Ohr, NLRB Regional Director of its Chicago Office, ruled that Northwestern football players are employees under the NLRA.

In its decision, the NLRB concluded, among other things, that to assert jurisdiction in this matter would not “effectuate the policies of the Act.” Additionally, due to the structure of the NCAA Division I Football Subdivision (“FBS”) of being primarily comprised of public colleges and universities, the Board ruled jurisdiction “would not promote stability in labor relations…in this case.” By statute, the NLRB does not have jurisdiction over state-run colleges and/or universities, which constitutes 108 of the 125 FBS teams. Northwestern University is the only private school that is a member of the Big Ten Conference, limiting the NLRB’s ability to exercise jurisdiction over its competitors within the conference. The Board recognized that such a scenario was without precedent because

NLRB Rules That Filing a Class or Collective Action Is Protected, Concerted Activity

By Michelle D. Wyrick

Last week, the National Labor Relations Board (“NLRB”) decided in 200 East 81^st Restaurant Corp. d/b/a Beyoglu that “the filing of an employment-related class or collective action by an individual employee is an attempt to initiate, to induce, or to prepare for group action and is therefore conduct protected by Section 7” of the National Labor Relations Act (“NLRA”). The employee in the case, a waiter, testified that he mentioned filing a lawsuit against his employer to one co-worker, who declined to participate in the proposed lawsuit. When the waiter filed the lawsuit, he did not obtain prior authorization from any other employee. On the day the complaint was served on the employer, the employer removed the waiter’s name from the work schedule and asked him if he expected to work while he was filing a lawsuit. The waiter left the workplace and was never told he could return to work. The Administrative Law Judge found that the employer terminated the waiter’s employment in retaliation for filing the lawsuit, on behalf of himself and other similarly situated employees, alleging violations of the Fair Labor Standards Act (“FLSA”).

The dissent disagreed with the majority’s conclusion that an employee’s filing of a class or collective action automatically equates to protected, concerted activity. The dissent noted that not every non-NLRA class or collective claim “triggers an automatic overlay of NLRA rights and restrictions.” In the dissent’s view, the simple act of filing a class or collective action “does not instantly convert the

NLRB Increases Scrutiny of Non-Union Employer Policies

By George J. Miller

In recent years, perhaps due to the steep decline in union organizing activity that traditionally created much of the work at the National Labor Relations Board, the Board, or more precisely the General Counsel of the Board, has been focusing attention on non-union employers’ policies that could violate the National Labor Relations Act (NLRA).  An example that has garnered a lot of attention is company social media policies. 

Recently, the current General Counsel of the NLRB put out a 30-page memo discussing the application of the NLRA to the following kinds of employee handbook policies:

• Confidentiality
• Conflicts of interest
• Speech and other conduct regarding the company and company supervisors
• Speech and other conduct regarding fellow employees
• Communications about the employer with third parties outside the company
• Restrictions on the use of company logos, copyrights and trademarks
• Restrictions on the use of cameras and recording devices at work
• Restrictions on leaving work during the workday 

The memo discusses actual cases in which the General Counsel’s office reviewed these policies and found them either lawful or unlawful under the NLRA.  Examples of both lawful and unlawful policies are given.  This is very useful for employers, attorneys and consultants in drafting policies that will pass muster at the NLRB.  The memo also discusses the settlement of a case involving Wendy’s International’s employee handbook.  It discusses various Wendy’s policies that were allegedly unlawful and how they were modified by Wendy’s and approved by the General Counsel’s office in the settlement.  Click here to access the page on the NLRB website where the memo can be found.