NLRB Invites Comments on Worker Misclassification

Mar 07, 2018 - 1:45pm

Executive Director, Labor Policy

The National Labor Relations Board (NLRB) has invited the public to submit briefs in a case involving the issue of whether alleged worker misclassification constitutes an unfair labor practice.  According to the NLRB’s notice, briefs are due by April 16.

Worker misclassification has been a topic of some controversy in recent years, as the previous NLRB General Counsel, Richard Griffin, sought a novel interpretation of the National Labor Relations Act (NLRA) to deem employee misclassification as an automatic unfair labor practice.  To that end, in March 2016 Griffin released a so-called “Advice Memo” requiring NLRB regional offices to submit cases involving alleged misclassification to his headquarters office for review as one of a litany of his topics of “policy concern.” 

As this blog reported at the time, it did not take long for the regional offices to tee up a case for Griffin to bring to the Board.  In May 2016, Region 21 (Los Angeles) of the NLRB issued a complaint based on an unfair labor practice charge brought by the International Brotherhood of Teamsters alleging that a trucking company (Intermodal Bridge Transport) had violated the NLRA by classifying drivers as independent contractors. 

However, despite what seemed like a suitable vehicle for Griffin to pursue his theory before the Board, the case meandered through the NLRB administrative process for over a year and a half.  An administrative law judge (ALJ) finally issued a decision on November 28, 2017, by which time Griffin’s term had expired, thus leaving that case to his successor and the current Board for consideration. 

Meanwhile, another case involving alleged misclassification of drivers—Velox Express, Inc.—arose when an ALJ found that the drivers for Velox Express, a medical courier company, were employees rather than independent contractors.  The ALJ adopted Griffin’s argument, concluding that “[b]y misclassifying its drivers, Velox restrained and interfered with their ability to engage in protected activity” under the NLRA. The case was ordered to the Board in September 2017, and in February 2018, the NLRB issued its invitation for briefs asking, “Under what circumstances, if any, should the Board deem an employer’s act of misclassifying statutory employees as independent contractors a violation of Section 8(a)(1) of the Act?” 

The reason for the tug-of-war over the issue of misclassification is that under the NLRA, employees, but not independent contractors, can form a collective bargaining unit represented by a union.  The theory behind the misclassification complaint is relatively straightforward: by classifying drivers as independent contractors, the company is allegedly inhibiting them from engaging in NLRA-protected activity and depriving them ability to join a union.

By making alleged misclassification an unfair labor practice unto itself, the Board would potentially ensnare more employers facing organizing drives.  That could have sweeping ramifications for businesses that operate in the growing “gig” or “peer-to-peer” economy, such as ride-sharing companies and others that facilitate transactions between individual contractors and their clients. 

As the NLRB considers this issue, one should hope that it does not adopt an expansive reading of the NLRA that would tilt the field in favor of unions as the Obama-era Board did so often. 

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Executive Director, Labor Policy