NLRB Reverses Trump Board Independent Contractor Standard

July 17, 2023 by Beeson Tayer & Bodine

 

The Biden NLRB issued an important decision in June restoring an earlier, more worker-friendly test for distinguishing between employees, who are covered by the NLRA, and independent contractors, who are not. In FedEx Home Delivery (FedEx II), the Obama Board held that the independent contractor test is made up of numerous factors, including for example, the extent of control by the employer or the method of payment. But the Trump Board later reversed FedEx II and held that the most important factor in the independent contractor test is “entrepreneurial opportunity.” This revised test vastly expanded the scope of workers who the Board would consider to be independent contractors.

The Board decision last month in Atlanta Opera, Inc. brought back the FedEx II standard of assessing numerous factors with no one factor being the most important of them. In doing so, the Board found that makeup artists and hairstylists at the Atlanta Opera are employees, protected by the NLRA.

The common-law factors the Board looked at in Atlanta Opera are:

• The extent of control by employer;
• Whether or not the individual at issue is engaged in a distinct occupation or business;
• Whether the work is usually done under the direction of the employer or by a specialist without supervision;
• Whether the employer or individual supplies instrumentalities, tools, and place of work;
• The length of time for which the individual is employed;
• The method of payment;
• Whether or not the work performed is part of the employer’s regular business;
• Whether or not the parties believe they are creating an independent contractor relationship;
• Whether the principal is or is not in business;
• Whether the evidence tends to show that the individual is in fact rendering services as an independent business.

The Board’s ruling in this case will make it easier for workers to organize by making it harder for employers to argue that workers are independent contractors excluded from the NLRA.

 

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