The joint employment ruling issued by the Obama National Labor Relations Board (NLRB) has been struck down by the D.C. Circuit Court of Appeals on grounds that the 2015 Browning-Ferris decision failed to adequately define “indirect control.”
That decision, which the Trump NLRB has vowed to reverse and rewrite, said that, if a corporation or franchisor had even indirect control over the employment decisions of its affiliates or franchisees, then it would be responsible for those decisions as a joint employer. The ruling turned on its head the longstanding direct control standard, whereby the head company could be held liable only if it exercised direct policy- and decision-making.
The D.C. court did not, however, rule the indirect standard absolutely invalid, but sent it back to the NLRB for a more concise definition. The ruling was issued on a 2-1 vote by the court.
The current NLRB, as has been noted, does not agree with the indirect control definition and has already issued a Notice of Proposed Rulemaking (NPRM) to restore the direct control standard.