Late last year the National Labor Relations Board rendered a long awaited decision in the Browning-Ferris Industries, Inc. action, and significantly changed the test for determining joint employer status. Law 360 (subscription required) reported on the decision and the potential affects it could have on labor actions.
This decision is of particular importance to individuals who are employed through staffing or temporary agencies and franchises. In 2014 almost 3 million people were employed through temporary agencies alone. This looser test may lead to more companies being liable for the acts of wrongdoing of other companies.
Previously the NRLB required an employee to show that a purported employer exercised actual direct and immediate control over a worker. Under the new test, a company may be considered an employer if it has the ability to control the employee’s terms of employment and working conditions. Indirect or potential control may now subject a company to liability.
One example of how this may play out is in the staffing industry. If a building management company hires a staffing agency to perform janitorial work, the management company may be held responsible for wrongful acts (such as wage violations) of the janitorial company. This could also possibly affect the millions of employees of fast food industries, rendering the many huge franchisors potentially liable.
The attorneys in Sommers Schwartz’s Employment Litigation Group handle all types of employment and labor actions. If you have questions regarding any employment matter, please contact us today.