New NLRB Joint Employer Standard Could Increase Liability for Acts of Staffing Vendors

Written By ESR News Blog Editor Thomas Ahearn

The dangers of lawsuits against employers for the actions of their staffing vendors may have increased with the August 27, 2015 decision by the National Labor Relations Board (NLRB) in a case where the definition of a “joint” employer was expanded by holding that the ability of an employer to exercise control over a worker can create joint employment, according to one safe hiring expert.

In the 3-2 decision involving Browning-Ferris Industries (BFI) of California, the NLRB refined the joint employer standard by finding that BFI was a joint employer with Leadpoint, the company that supplied employees to BFI. In finding that BFI was a joint employer with Leadpoint, the NLRB relied on indirect and direct authority and control BFI possessed over the employment of employees supplied by Leadpoint.

According to a press release about the Browning-Ferris decision, the NLRB held that the previous joint employer standard failed to keep pace with changes in the workplace and economy circumstances that saw more than 2.87 million of U.S. workers employed through temporary agencies as of August 2014. The NLRB found that two or more entities are joint employers of a single workforce if:

• (1) They are both employers within the meaning of the common law; and
• (2) They share or codetermine those matters governing the essential terms and conditions of employment.

In evaluating whether an employer possesses sufficient control over employees to qualify as a joint employer, the NLRB will consider whether an employer has exercised control over terms and conditions of employment indirectly through an intermediary or has reserved the authority to do so. A copy of the Browning-Ferris decision is available at https://www.esrcheck.com/file/NLRB-Browing-Ferris-Decision.pdf.

“It is more important than ever that employers understand what their staffing vendors are doing since the new joint employer standard can potentially open up more employer liability for acts of staffing vendors,” says Attorney Lester Rosen, founder and CEO of Employment Screening Resources (ESR) and author of ‘The Safe Hiring Manual,’ a comprehensive guide to background checks for employment purposes.

“Where employers rely up the services of third party staffing vendors, it is also important to ensure that all Fair Credit Reporting Act processes are being followed by the vendor,” adds Rosen. “A recent lawsuit filed against both a nationally known business and a staffing firm underscores the need for employers to work carefully with staffing providers to ensure that the FCRA requirements are being followed.”

Employment Screening Resources (ESR) provides background check services that protect staffing agencies so they can better serve their clients and maintain their competitive edge. ESR helps to find the right staffing candidate by eliminating unqualified workers and screening out potentially dangerous applicants. For more information about ESR, call 888.999.4474 or visit https://www.esrcheck.com.

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