The National Labor Relations Board (NLRB) has issued a final rule on determining joint-employer status, raising concerns by some in trucking that relationships between carriers could be disrupted and they could see increased labor costs.

The rule sets forth the factors the NLRB will examine when deciding whether two companies may be considered “jointly” responsible for the same employee. Joint responsibility potentially exposes both companies to legal damages for violation of worker’s rights and protections under law. Joint responsibility also opens a non-unionized company to the unionization efforts or grievances at another company.

Founded in 1935, the NLRB is an independent federal agency protecting employees from unfair labor practices. In that capacity, the NLRB conducts hundreds of workplace elections each year. In this instance, the NLRB conducted a rulemaking that overturns joint employer determination standards adopted during the prior administration.

Under the new rule, companies may be found as joint employers if they share one or more of an employee’s “essential terms and conditions of employment.” Those are defined as:

  • Wages, benefits, and other compensation
  • Hours of work and scheduling
  • The assignment of duties to be performed
  • The supervision of the performance of duties
  • Work rules and directions governing performance of duties and grounds for discipline
  • The tenure of employment, including hiring and discharge
  • Working conditions related to the safety and health of employees

The NLRB final rule does not require the actual, substantive, or ongoing exercise of authority over an employee to find that the company has become a joint employer. Instead, joint employer status can be inferred by indirect employer actions. For example, Company A tells an employee’s manager in Company B, “Let’s get started on this in the morning.” That potentially affects hours of work and scheduling, an “essential term and condition of employment.”

Under the new NLRB rule, joint employer status can also be inferred by unexercised or “reserved” authority, where a company could have given direction to a worker, whether the company did so or not. The NLRB found that the mere existence of employer authority can alter worker behavior.

The NLRB final rule only affects cases brought before the board, where the factual context of each situation becomes critical. The NLRB stated that the new joint employer determination standards would only apply to cases brought after the effective date of this final rule. Those cases might involve a motor carrier and a staffing agency providing drivers. Or they might cover situations where one carrier contracts with other carriers to handle a transportation project.

Nonetheless, one of the “essential terms and conditions of employment” – working conditions related to the safety and health of employees – is especially problematic for future NLRB cases involving trucking. Truck drivers, truck mechanics, and other trucking employees are already subject to safety and health regulations by the Federal Motor Carriers Safety Administration (FMCSA) or by the Occupational Safety and Health Administration (OSHA). Regulations like hours of service, drug and alcohol testing, driver training, or even the precise design of steps to mount a truck cab are already law. These items are not negotiable between employers, not negotiable at time of employee hiring, and not subject to collective bargaining. But the NLRB sees them as potential evidence of joint employer status.

One last question: when are workers “employees” and when may they be “independent contractors”? There, the NLRB and the U.S. Department of Labor already favor employee status.

The NLRB final rule was originally set to become effective Dec. 26, 2023. However, on Nov. 16, 2023, the NLRB announced it was moving the date to Feb. 24, 2024 to “to facilitate resolution of legal challenges with respect to the rule.” Because it is considered a “major rule,” it is subject to the Congressional Review Act. U.S. Senators Joe Manchin (D-WV) and Bill Cassidy, M.D. (R-LA) have introduced a resolution to overturn the NLRB final rule.

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