National Labor Relations Board v. Browning-Ferris Industries of Pennsylvania, Inc.
111 L.R.R.M. (BNA) 2748, 691 F.2d 1117, 73 A.L.R. Fed. 597 (1982)
Premium Feature
Subscribe to Lexplug to listen to the Case Podcast.
Rule of Law:
Two or more entities are considered 'joint employers' under the National Labor Relations Act (NLRA) if they share or co-determine the matters governing the essential terms and conditions of employment for a group of employees. The determination is a factual one based on the amount of control an entity exerts over the workers, regardless of whether it is their direct employer.
Facts:
- Browning-Ferris Industries of Pennsylvania, Inc. (BFI) operated a refuse transfer site and contracted with independent truckers, called 'brokers,' to provide tractors and drivers to haul BFI's refuse trailers.
- The agreements between BFI and the brokers were oral and terminable at will by either party.
- BFI established the work shifts, set speed limits on its property, directed drivers to specific loading and dumping areas, and provided drivers with BFI-branded coveralls.
- BFI required that it approve all drivers before they were permitted to haul its trailers, and BFI managers would criticize drivers for arriving late or leaving early.
- BFI's plant manager, Bud Moersch, on multiple occasions, unilaterally told drivers employed by the brokers that they were fired and barred from BFI property.
- Moersch also asserted his authority directly to a broker, stating that he, not the brokers or drivers, was the 'boss' at the transfer station.
Procedural Posture:
- An Administrative Law Judge (ALJ) found that BFI was a 'joint employer' and had engaged in unfair labor practices.
- The National Labor Relations Board (NLRB) adopted the ALJ's findings and issued an order against BFI, requiring reinstatement and back pay for the fired drivers.
- The NLRB petitioned the U.S. Court of Appeals for the Third Circuit, the court issuing this opinion, to enforce its order against BFI.
Premium Content
Subscribe to Lexplug to view the complete brief
You're viewing a preview with Rule of Law, Facts, and Procedural Posture
Issue:
Under the National Labor Relations Act, is a company a 'joint employer' of workers hired by its independent contractors if the company exerts significant control over the essential terms and conditions of their employment?
Opinions:
Majority - Garth, Circuit Judge
Yes. A company is a 'joint employer' of workers hired by its contractors if the company shares or co-determines the essential terms and conditions of their employment. The court distinguished the 'joint employer' test from the 'single employer' test. The 'single employer' test, from Radio Union, determines if two separate companies are actually one integrated enterprise by looking at factors like common ownership and management. In contrast, the 'joint employer' test, articulated in Boire v. Greyhound Corp., assumes two separate entities but asks whether they share control over the workers. It is a factual inquiry into whether the secondary employer 'possessed sufficient indicia of control to be an employer.' Here, substantial evidence showed BFI shared control with the brokers over essential employment conditions: BFI's manager hired and fired drivers, BFI set work hours, BFI supervised the drivers' performance on site, and BFI established rules of conduct. This shared control made BFI a joint employer of the drivers within the meaning of the NLRA.
Analysis:
This decision clarifies and reinforces the critical distinction between the 'single employer' and 'joint employer' doctrines under the NLRA. By rejecting the application of the more stringent four-factor 'single employer' test to joint employer questions, the court broadened the potential liability for companies that utilize subcontractors. The ruling emphasizes that the reality of control over working conditions, not the formal contractual relationship, is the determinative factor. This precedent signals to companies that they cannot avoid labor law obligations by subcontracting work if they maintain significant control over the subcontractor's employees, impacting business models that rely heavily on contractors.
