NWRA opposes NLRB’s proposed rulemaking on joint employment

The National Waste & Recycling Association (NWRA), Washington, has responded to the National Labor Relations Board’s (NLRB) Notice of Proposed Rulemaking (NPRM) addressing the standard for determining joint-employer status under the National Labor Relations Act (NLRA).

The NWRA has urged the board to maintain the existing rules established in 2020 rather than updating them to make it easier for labor groups to claim joint-employer status.

Under the proposed rule, two or more employers would be considered joint employers if they “share or codetermine those matters governing employees’ essential terms and conditions of employment,” such as wages, benefits and other compensation, work and scheduling, hiring and discharge, discipline, workplace health and safety, supervision, assignment and work rules. The NLRB proposes considering both direct evidence of control and evidence of reserved or indirect control over these essential terms and conditions of employment when analyzing joint-employer status.

“In an economy where employment relationships are increasingly complex, the board must ensure that its legal rules for deciding which employers should engage in collective bargaining serve the goals of the National Labor Relations Act,” NLRB Chair Lauren McFerran says. “Part of that task is providing a clear standard for defining joint employment that is consistent with controlling law. Unfortunately, the board’s joint employer standard has been subject to a great deal of uncertainty and litigation in recent years.”

In its comments, which oppose the proposed rule change, the NWRA says that under the proposed rule, two or more employers would be considered joint employers if they “share or codetermine those matters governing employees’ essential terms and conditions of employment,” such as wages, benefits and other compensation, work and scheduling, hiring and discharge, discipline, workplace health and safety, supervision, assignment and work rules. The NLRB proposes considering both direct evidence of control and evidence of reserved and/or indirect control over these essential terms and conditions of employment when analyzing joint-employer status.

“The waste and recycling industry believes that a clear, consistent standard is needed to guide businesses in confidently deciding whether to enter into arrangements intended to constitute contractor relationships and to keep such individuals safe while working at their locations,” NWRA President and CEO Darrell Smith says. “We urge the NLRB to abandon this rulemaking and keep the current rule in place.”

The proposed rule would put innumerable parties, many of whose interests are in direct conflict, at the bargaining table and expect that somehow, some way, these parties will come to an agreement on the scope of an acceptable contract. It is beyond the realm of logic or realism to expect a company to be forced to the bargaining table when it has only a limited right of control (perhaps never exercised) or indirect control over a single term or condition of employment for a third party’s employees, the NWRA says.

It is safe to assume that many large employers in the waste management and recycling industry—who are direct competitors to one another—enter into contracts with third-party companies that support the industry and which contract with numerous waste management clients. In that scenario, all joint-employer parties across the table from the union have directly conflicting interests, says the NWRA in its comments. The union wants increased wages for its workers. The third-party contractor has no interest in bearing these costs, as its goal is to keep its expenses as low as possible and pass on any wage increases to its client customers by way of its contracted fee. These clients, in turn, share a single desire—to have the vendor shoulder increased labor costs—but as between the two, five, or 50 of them, each would prefer another to bear the cost of any wage increase.