There are 3 significant developments at the National Labor Relations Board (“NLRB”).
NLRB Revises Independent Contractor Test
In late January, the Board overturned the Obama-era test for establishing whether an individual is an employee or independent contractor under the National Labor Relations Act. Under the Obama-era test, the Board ignored whether an individual had entrepreneurial opportunities in performing the services. Under the current test, the Board has restored the previously longstanding common law agency test and will again consider whether the individual had entrepreneurial opportunities.
This decision will make the analysis of independent contractor status more employer-friendly and balanced, particularly in the context franchisors and franchisees and a company’s service providers. For more information on the decision, see the NLRB’s press release.
Still No New Joint-Employer Rule
After two 30-day extensions, the period for submitting comments to the NLRB’s proposed rule for replacing the Obama-era Joint-employer test closed on January 22, 2019. Nevertheless, until the proposed rule is finalized the Obama-era test remains in effect. For more information on the propose rule, see notice of proposed rule.
Board Member Mark Gaston Pearce Will Not Seek Re-Appointment
On Tuesday February 5, 2019, former NLRB Chairman Mark Gaston Pearce announced that he will not seek re-appointment to the Board. President Trump re-nominated Pearce to the Board immediately after his term expired, but, his re-appointment was met with criticism by business groups and Congress did not act on his nomination. Pearce’s announcement ensures that a new Board Member will be appointed.
The long held tradition is that the President appoints the majority of the board (i.e., 3 members) from his own party and a minority (i.e., 2 members) from the other party. Based on the Board’s composition, it is likely that the President will appoint a member of the Democratic party.