9.19.2016

Although the temperatures are finally starting to cool off and fall is in the air, baseball season is heading into the playoffs and is still in full swing.  What does that mean for employers? Don’t get caught in a “double play.”  Last month, the National Labor Relations Board (NLRB) released an opinion indicating that an employer’s misclassification of workers as independent contractors can result in an unfair labor practice charge under the National Labor Relations Act (“NLRA”) if that misclassification is used to prevent workers from unionizing.  The bottom line for employers-- in addition to penalties that employers may incur under the wage and hour laws for misclassification, employers may also be subject to possible penalties under the NLRA, in essence a penalty “double play.”

The case that brought the issue up to bat concerned an employer, Pacific 9 Transportation, Inc., which informed its truck drivers that because they were independent contractors not employees of the company-they had no right to form a union.  The threshold issue for the NLRB:  were the workers were independent contractors or employees.  To make that determination, the NLRB examined a number of factors, including:

  • the extent of the employer’s control over the work performed by the worker;
  • whether the worker is engaged in a distinct business;
  • whether the worker is supervised by the employer or works independently;
  • how long the worker has worked for the employer;
  • whether the worker is providing services as part of an independent business;
  • whether the services that the worker is providing is part of the employer’s regular business.

The more control and supervision that an employer provides over a worker, the more likely the NLRB will determine that the worker is an employee and not an independent contractor.  Conversely, the less supervision and control over the worker, the less likely the NLRB is to determine that the worker is an employee.  In the Pacific 9 Transportation matter the NLRB decided that the truckers were employees, not independent contractors.

Having made that determination the NLRB  concluded:  “the employer’s misclassification of its employees as independent contractors acts to interfere and restrain its employees in the exercise of their [right to unionize].”  The NLRB opinion emphasized that the employer specifically told its workers that since they were independent contractors, they could not unionize.  This statement was untrue and misleading to the workers, who believed they could not form a union because of their classification status. 

Employers always had to be careful not to misclassify their workers for many statutory and regulatory reasons .  But now, the NLRB has come up with another:  employers can be caught in a “double play” if the misclassification is used to prevent workers from unionizing.  Employers should take the time to examine their worker classifications and make any necessary adjustments to prevent possible legal liability.

For any information or questions on the information provided above, please contact a member of the Wilentz Employment Law Team.

BLOG DISCLAIMER

The postings on this blog were created for general informational purposes only and do not constitute legal advice or a solicitation to provide legal services.  Although we attempt to ensure that the postings are complete, accurate, and up to date, we assume no responsibility for their completeness, accuracy, or timeliness.  The information in this blog is not intended to create, and receipt of it does not constitute, a lawyer-client relationship.  Readers should not act upon this information without seeking professional legal counsel.

This blog may contain links to independent third party websites and services, including social media. We provide these links for your convenience, and you access them at your own risk.  We have no control over and do not monitor the content or policies (including privacy policies) of these third-party websites and have no responsibility for, and no liability with respect to, their content, accuracy, or reliability.  Unless expressly stated, we do not endorse any of the linked websites or any product, service, or publication referenced herein or therein.  We will remove a link to any site from this blog upon request of the linked entity.

We grant permission to readers to link to this blog so long as this blog is not misrepresented. This site is not sponsored or associated with any other site unless so identified.

If you wish for Wilentz, Goldman & Spitzer, P.A., to consider representing you, please obtain contact information from the Contact Us area of this blog or go to the firm’s website at www.wilentz.com.  One of our lawyers will be happy to discuss the possibility of representation with you. However, the authors of Wilentz blogs are licensed only in New Jersey and/or New York and do not wish to represent anyone who viewed this site in a state where the site fails to comply with all laws and ethical rules of that state.

PRIVACY POLICY