ARE THEY MY EMPLOYEES?

Transcription

1 ARE THEY MY EMPLOYEES? May 12, 2015 David Dubberly Certified by S.C. Supreme Court as Specialist in Labor and Employment Law 1

2 Overview Government agencies expanding definition of who is an employer NLRB DOL EEOC Tips for avoiding joint liability when: Using staffing firm Sub-contracting Franchising 2

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4 Current Joint Employer Standard Under NLRA Joint employers share the ability to control or co-determine essential terms and conditions of employment Control is direct and immediate Essential terms and conditions include wages, hiring, firing, disciplining, or supervising employees 4

5 The Board and Office of General Counsel 5

6 OGC Amicus Brief in BFI Case 6

7 Facts in BFI Leadpoint employees sorted recyclable items for waste and cleaned BFI facility Teamsters sought to represent Leadpoint employees and requested ruling on whether BFI and Leadpoint were joint employers If union wins and BFI is joint employer, BFI will have to participate in CBA negotiations and be bound by the CBA Regional Director found no joint employment Teamsters appealed 7

8 Facts in BFI Leadpoint: Set pay scale and was sole provider of benefits Controlled scheduling of shifts, OT, and vacation Supervised its employees daily work it had on site HR department Had sole authority to control recruitment, hiring, counseling, discipline, and termination 8

9 Facts in BFI BFI: Set wage caps Requested employees be terminated Set hours of shifts Controlled speed of material stream 9

10 OGC Brief In May 2014 NLRB invited amicus briefs on joint employer issue In June 2014 GC filed brief arguing for broader joint employer test Claimed Board s current standard ignores Congress s intent that term employer be construed broadly Urged Board to abandon direct and immediate control standard 10

11 OGC Brief GC argued joint employer status should be found when: under the totality of the circumstances, including the way the separate entities have structured their commercial relationship, the putative joint employer wields sufficient influence over the working conditions of the other entity s employees such that meaningful bargaining could not occur in its absence 11

12 General Counsel s Proposed Broader Standard If an employer wields sufficient influence over the working conditions of a sub-contractor s employees, the employer can be found to be a joint employer Consider indirect control Consider potential for control 12

13 Status of BFI Case is currently pending before Board NLRB decisions may be appealed to Courts of Appeals, and from there to Supreme Court 13

14 NLRB News Release Regarding McDonald s Cases 14

15 McDonald s Press Release After Complaints Filed 15

16 NLRB Fact Sheet Regarding McDonald s Cases 16

17 Status of McDonald s Cases Complaints filed in December 2014 and February 2015 Allegations against McDonald s corporate are sparse: McDonald s and its franchisees are parties to a franchise agreement McDonald s possesses and/or exercised control over the labor relations policies of each franchisee McDonald s and the franchisees are joint employers 17

18 Status of McDonald s Cases Motion for a Bill of Particulars or, in the alternative, Motion to Strike Joint Employer Allegations and Dismiss the Complaint Denied Motion to Sever Denied Request for Special Appeal regarding order of evidence Denied Hearings started on March 30,

19 Status of McDonald s Cases ALJ decisions may be appealed to NLRB NLRB decisions may be appealed to Courts of Appeals Courts of Appeals decisions may be appealed to Supreme Court 19

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21 FLSA Regulations A single individual may stand in the relation of employee to two or more employers at the same time. Where the employee performs work which simultaneously benefits two or more employers, or works for two or more employers at different times during the workweek, a joint employment relationship generally will be considered to exist

22 FLSA Economic Reality Test U.S. Supreme Court in 1945: FLSA has broadest definition of employment relationship in any act U.S. Supreme Court in 1961: [E]conomic reality rather than technical concepts is to be the test of employment Application of this test has varied 22

23 FLSA Economic Reality Test Formal control test Power to hire/fire employees Day-to-day supervision or control over employee work rules, assignments, work schedules, and other conditions of employment Determination of rate/method of pay Maintenance of employee records, such as payroll, insurance, and tax Functional control test Focuses on whether functional control exists even without right of control 23

24 Wage and Hour Division Administrator 24

25 DOL Blog 25

26 Olvera v. Bareburger Group, LLC Franchise employees sued franchisee and franchisor under FLSA They claimed franchisor controlled the employees by: Guiding the franchisee on how to hire and train employees Setting and enforcing operational requirements Monitoring employee performance Specifying methods and procedures for preparing food 26

27 Olvera v. Bareburger Group, LLC In 2014 district court denied motion to dismiss Case settled 27

28 In Re Enterprise Rent-A-Car Wage & Hour Employment Practices Litigation Assistant managers filed OT pay complaint against employer and parent company, claiming parent company was joint employer District court granted summary judgment for parent company In 2012 appeals court affirmed because parent company: 28

29 In Re Enterprise Rent-A-Car Wage & Hour Employment Practices Litigation Had no authority to hire and fire assistant branch managers; Had no authority to promulgate work rules or assignments, and no authority to set compensation, benefits, schedules, or rates or methods of payment; Was not involved in employee supervision or employee discipline; Did not exercise or maintain any control over employee records. 29

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31 EEOC Compliance Manual The term joint employer refers to two or more employers that are unrelated or that are not sufficiently related to qualify as an integrated enterprise, but that each exercise sufficient control of an individual to qualify as his/her employer. 31

32 Tests Used In Title VII, ADEA, and ADA Cases Common law agency/right of control: exercise of significant control over employer through regulation or policy Hybrid: combination of tests makes extent of right of control the key factor Consider: Who hires and fires Who pays Who assigns the work Who controls daily activities Who furnishes equipment 32

33 EEOC v. Valero Refining-Texas LP Valero hired contractor to remodel refinery Contractor hired foreman who was unable to read Valero required that all contractors, for safety reasons, pass a written test When contractor terminated him, EEOC sued Valero under the ADA 33

34 EEOC v. Valero Refining-Texas LP Valero moved for summary judgment because it was not the employer Court ruled for Valero, holding that mere power to exclude contractor s employee from worksite did not make it employer 34

35 Tips Contracts with Providers Identify the employer of the provider s employees State the agreement does not create an employment or joint employment relationship Assign control of employees to the provider Provider accepts responsibility Provider agrees to comply with applicable law Provide for indemnification for employment claims 35

36 Tips Control Factors Provider to discipline its employees Make hiring, firing, promotion, demotion, etc. decisions Training and supervision of workers Supply of tools or equipment Providing employee benefits Employer to limit interaction with provider employees 36

37 Questions? David Dubberly Phone: