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CDW SEEKS RULEMAKING TO REMEDY BFI

June 13, 2018 // Washington, D.C. // Today, the Coalition for a Democratic Workplace and 16 leading associations filed a petition with the National Labor Relations Board seeking a rulemaking to remedy the confusion caused by a previous Board’s radical changes to the “joint employer” standard.

The controversial 2015 NLRB Browning Ferris Industries, or BFI decision, expanded and muddled the standard for determining when two separate companies are “joint employers” under the National Labor Relations Act. Joint employers are jointly responsible for labor violations committed by the other and bargaining with respect to any jointly employed workers.

The BFI decision overturned decades of established labor law and undermined the relationships between brand companies and local franchise business owners; contractors and subcontractors; and businesses and their suppliers and vendors. In short, BFI has cast a cloud of uncertainty over business models that have created millions of jobs and allowed hundreds of thousands of individuals to achieve the American Dream of owning their own small business.

The BFI standard also has hampered businesses’ efforts to provide guidance to and impose quality and conduct standards on franchisees, contractors and vendors to the detriment of workers and consumers.

The Petition notes that:

The BFI decision turns a blind eye to the realities of American workplaces and threatens to undermine innovative new business models and the very business relationships that are the engine of our nation’s economy.  BFI’s “reserved control” and “indirect control” standards are so vague and broad that it is often impossible for businesses to determine which relationships will trigger joint employment and which will not.  The scant guidance from the Board on how to apply this unprecedented and amorphous standard has left the regulated community in the dark as to how to structure business to business relationships in a manner that predicts liability or other joint employer obligations.  

While the uncertainty created by the BFI standard negatively impacts companies of all sizes across many industries, it is particularly damaging for small and local businesses. The standard encourages larger companies to limit the number of entities with whom they contract, which stifles opportunities for small businesses and startups.

CDW’s petition, if answered affirmatively by the Board, would clarify the operating landscape and protect countless businesses.