By Nelson Cary and Lauren Sanders
On Monday, the NLRB vacated its decision in Hy-Brand Industry Contractors. As we discussed on this blog in December, the Hy-Brand decision adopted a more demanding test for determining when multiple employers are considered joint employers.
Monday’s decision comes on the heels of a report from the NLRB’s Office of the Inspector General (“OIG”). The OIG is an independent office within the agency whose job it is to “to prevent and detect fraud, waste, abuse, and mismanagement, and to promote economy and efficiency in government.” The OIG criticized the involvement of Board Member William J. Emanuel (R) in the Hy-Brand decision.
Emanuel’s former law firm represented the employer in the Browning-Ferris Industries decision, and the NLRB considered the facts and arguments of the Browning-Ferris parties in Hy-Brand. The OIG report noted that the effect of the Hy-Brand decision-making process was a “‘do over’ for the Browning-Ferris parties.” Accordingly, the OIG concluded that an Executive Order from President Trump would have prohibited Member Emanuel from participating in the decision.
In vacating the Hy-Brand decision, the NLRB returns to the Browning-Ferris Industries test that an employer is a joint employer if it has indirect or potential control over workers — at least for now. Given that the Browning-Ferris joint employer test was one of the more controversial decisions during the Obama administration, the NLRB will likely try to overturn it again, especially when the NLRB becomes once again majority Republican.