Browning-Ferris’s Footnote 44: Vindication a Quarter Century Later

September 1, 2015
Guest Post

by Reuben Guttman, partner, Guttman, Buschner & Brooks, PLLC; member, ACS Board of Directors

For a union-side labor lawyer, identifying the employer for the purposes of bargaining and unfair labor practices is akin to a search for the Holy Grail. Three years of law school and courses in labor and employment law ― from excellent professors at Emory Law ― could not prepare me for the challenge of this search which consumed virtually all of my time when I was a Washington, D.C.-based attorney for the Service Employees International Union from 1985 to 1990.

The search began for me in the winter of 1985. SEIU had negotiated a city-wide contract covering its Pittsburgh janitors. Rather than allowing its union contractor to continue to service its buildings under the new labor agreement, Mellon Bank terminated its janitorial vendor and its union workforce. Nearly 70 workers lost their jobs and the benefits that went with them. They were replaced by low-wage, part-time workers who were not accorded nearly the same level of benefits. I was challenged to find a legal solution.  

In the late hours of the night, poring through the case reporters at the University of Pittsburgh Law Library, I came across the Supreme Court’s decision in Boire v. Greyhound which established the joint employer doctrine. To my delight, I learned that an entity could be considered an employer even where employees were paid by another company. I also came across a Third Circuit case, NLRB v. Browning-Ferris Industries of Pennsylvania, Inc., which ― in my mind as a young lawyer ― made things quite clear: Two or more employers can be co-employers “if they share or codetermine those matters governing the essential terms and conditions of employment.” If only the analysis were that simple.

We filed charges with the National Labor Relations Board and launched a federal court law suit claiming that Mellon, as a co-employer, had breached the labor agreement. With discovery from the suit and detailed affidavits from workers we were able to convince the General Counsel to the NLRB ― then Rosemary Collyer ― to issue a complaint against Mellon as a joint employer. News of the complaint came to me while defending depositions of my clients in the federal court action. In a cavernous conference room at Pittsburgh’s Reed Smith, my clients were being questioned on the intricacies of their jobs. “Who at Mellon Bank actually gives you instructions at work?” a Reed Smith lawyer asked my client, Virgil Lightsey. To paraphrase his response, Mr. Lightsey testified that he could not remember his name but “it was one of the big Mellons upstairs.” 

Mellon was a success; the case settled, workers divided back pay of $750,000 and they were returned to their jobs. Yet, I soon learned that without fact discovery ― secured only though parallel litigation ― it was impossible to pierce the paper relationship between alleged joint employers, which fictionalized the actual work environment. To complicate matters, the NLRB and its General Counsel seemed to move away from the loosely articulated standard of the Third Circuit, viewing the matter of “joint employer” with a limited focus on which employer has direct control and whether that control was actually exercised. With the growth of multi-employer worksites and less traditional employment relationships, including employee leasing schemes, the NLRB’s new standards enabled shadow employers to terminate an entire workforce by changing a contractor or vendor while keeping their hands ― at least seemingly ― clean of any labor law violation. 

In 1999, wearing the rose-colored glasses that only young lawyers wear, I spent several weeks in trial before the Regional Director of the NLRB in Los Angeles claiming that the Southern California Gas Company and the contractor that cleaned its headquarters building were joint employers. The case arose in the context of a representation petition where the union, amidst an organizing campaign, sought a declaration that there was a joint employer relationship, meaning that both Southern California Gas and its contractor would be bound to jointly bargain with the union and execute a labor agreement if the union won an election and was certified as the bargaining agent. We lost, or so it seemed.

Fast forward 25 years to August 27, 2015, and Browning-Ferris Industries is again making joint employer law with a 50-page opinion from the NLRB restating the basics of the 1982 Third Circuit opinion and moving away from a technical “direct and immediate control” analysis to a more of a “totality of the circumstances” analysis. In finding a joint employer relationship between Browning-Ferris and its contractor, the NLRB explained, “In this area of labor law, as in others, the ‘nature of the problem, as revealed by the unfolding variant situations,’ requires ‘an evolutionary process for its rational response, not a quick, definitive formula as a comprehensive answer.’” The NLRB explained that whether an employer’s control of employment matters is direct and immediate is not the only analysis.

Reading further, I noticed this passage citing, in footnote 44, the Southern California Gas Company case: “This restrictive approach has resulted in findings that an entity is not a joint employer even where it indirectly exercised control that significantly affected employees’ terms and conditions of employment. For example, the Board refused to find that a building management company that utilized employees supplied by a janitorial company was a joint employer notwithstanding evidence that the user dictated the number of workers to be employed, communicated specific work assignments and directives to the supplier’s manager, and exercised ongoing oversight as to whether job tasks were performed properly.”

Vindication at last!