Watch the labor on your watch

If you hire independent contractors, a recent National Labor Relations Board (NLRB) ruling could affect how you pay them.

Now that the Trump administration has staffed the NLRB, the agency has been issuing various rulings, such as its 3-2 decision overturning the 2015 decision involving Browning-Ferris Industries, thereby returning the standard to its standing before the Obama administration.

According to the Browning-Ferris standard, indirect control of an employee could constitute a joint-employer relationship. Under the new ruling, a company only will be deemed a joint employer if there is proof the employer has exercised direct control over employment terms of that employee.

According to Construction Dive, the new interpretation means some subcontractors could be subject to the control and oversight of a general contractor. The Associated General Contractors of Washington says contractors who use employment agencies or contingent workers could be more susceptible to charges involving unfair labor practices involving other employees.

To avoid this, general contractors should ensure subcontractors do not dictate the wages, amount of staff or work processes of sub-subcontractors. Subcontractors also should be responsible for workers' evaluations, disciplinary action and termination though they should try to avoid involvement with other sub-subcontractors that could be construed as "co-management."

On its website, NLRB states: "In all future and pending cases, two or more entities will be deemed joint employers … if there is proof that one entity has exercised control over essential employment terms of another entity's employees (rather than merely having reserved the right to exercise control) and has done so directly and immediately (rather than indirectly) in a manner that is not limited and routine. Accordingly, … proof of indirect control, contractually reserved control that has never been exercised, or control that is limited and routine will not be sufficient to establish a joint-employer relationship."

Incidentally, Browning-Ferris currently is pending in the D.C. Circuit Court of Appeals where a decision has been expected since spring 2017. It's unclear whether the NLRB's recent ruling would render the D.C. appeals court case moot.

Further information regarding the ruling can be found at www.nlrb.gov.

Ambika Puniani Reid is editor of Professional Roofing and NRCA's vice president of communications and production.