Between August 29 and September 10, the National Labor Relations Board (“NLRB” or “Board”) issued four decisions that resolve important issues that have been the subject of long-running disputes. It also issued an invitation to submit briefs in a case that provides an opportunity for the current Board majority members to revise the standard for when employee conduct loses protection under the National Labor Relations Act.
Misclassification of Employees As Contractors Alone Does Not Violate Federal Law
On August 29, 2019, the NLRB decided that employers who incorrectly classify employees as independent contractors – who are not subject to the protections and benefits of the National Labor Relations Act (“NLRA”), which applies only to non-managerial, non-supervisory employees – do not violate the NLRA because misclassification “does not, in and of itself, contain any ‘threat of reprisal or force or promise of benefit.’” Specifically, the Board held that an employer only violates the NLRA in misclassifying employees as contractors when it actively relies upon or uses the misclassification to interfere with protected rights under the NLRA; therefore, employers do not interfere with workers’ organizing rights by simply misclassifying them as contractors. Although a win for employers, employers nonetheless should remain cautious because this decision does not absolve all potential liability relating to misclassification of employees. Employers should still take great care to avoid misclassification to protect against liability involving the Fair Labor Standards Act, tax requirements, unemployment benefits, and workers compensation. Continue Reading