NLRB independent contractor status update

The U.S. Department of Labor's rule to increase the salary threshold for the overtime exemption of executive, administrative and professional employees under the Fair Labor Standards Act has not yet been finalized.

The March 7 proposed rule was open for comments for a 60-day period. The Department of Labor received more than 116,000 public comments. The Department of Labor sent its final draft of the rule to the White House and the Office of Management and Budget on Aug. 12. The text of the final rule has not been made public.

When the final rule is published with an effective date, many expect unions and worker advocates to mount legal challenges to the rule. Even though the final rule may be challenged, it would be wise to be developing a plan now to address this huge budgetary issue.

This column focuses on the standard salary threshold, which will have the most dramatic impact on your company, and offers an action plan to address the standard salary threshold increase.

The Division of Advice within the NLRB general counsel's office recently issued a memorandum describing why it believed Uber drivers should be considered independent contractors, not employees for purposes of the National Labor Relations Act. For that reason, charges filed by Uber drivers were dismissed.

The general counsel believed the Uber drivers to be independent contractors for two key reasons.

Very recently, a daily newspaper in Tupelo, Miss., received a determination from the Mississippi Employment Security Department that its newspaper carriers are employees. The decision totally ignores the exclusion granted by the legislature in 2012. Needless to say, the newspaper vigorously protested, appealed this determination, emphasizing the provision. The State of Mississippi backed off completely, agreeing that the newspaper carriers are not eligible for benefits and the publishing company is not liable for unemployment taxes or payments made to newspaper carriers.

This writer and many others predicted that the Department of Labor, under the leadership of Secretary Acosta would publish a new proposed rule in March 2019. The new proposed rule would increase the salary level threshold that must be met in order to be overtime exempt under the Federal Fair Labor Standards Act.

The new proposed rule, announced March 7, will increase that threshold from $23,660 per year (or $455 per week) to $35,308 per year (or $679 per week). This new threshold is far less than the threshold proposed by the Obama administration that was permanently enjoined nationwide by a federal court in Texas.

On Jan. 25, the National Labor Relations Board, in a three-to-one decision, ruled that Super Shuttle drivers at the Dallas Fort Worth Airport were independent contractors and not employees.

This case is especially good news for the newspaper industry. The board in the new Super Shuttle case specifically referenced its decision in St. Joseph News-Press, a 2005 decision. In that decision, the NLRB found that home delivery carriers, single copy carriers and bundle haulers were all independent contractors.

In December 2018, new NLRB General Counsel Peter Robb issued several new advice memoranda. Advice memoranda advise local NLRB offices about how to proceed with a particular unfair labor practice charge.

In one such memorandum, the employer's "Commitment to My Coworkers" policy was found to be lawful. The employer required all employees to read and sign a "Commitment to My Co-Workers" document.

On Aug. 1, the National Labor Relations Board invited interested parties to file briefs on whether the board should adhere to, modify or overrule Purple Communications – a case (decided by the Obama Board) that held employees who had been given access to their employer's email system for work-related purposes have a presumptive right to use that system, on non-working time, for communications protected by Section 7 of the National Labor Relations Act (union organizing activity).

On May 21, the United States Supreme Court issued its long awaited decision in Epic Systems Corp v. Lewis. Justice Gorsuch delivered the opinion of the court. Rejecting the position of the National Labor Relations Board, the court ruled that employers and employees may lawfully agree that any disputes between them will be resolved through one-on-one arbitration. The court ruled that under the National Labor Relations Act, employees do not have the right to file class or collective actions, no matter what they agreed with their employer.

To drive revenue, publishing companies are increasingly producing "premium editions" for their newspapers.

Many legal issues must be considered when preparing newspaper subscription promotions. What you communicate about "premium editions" – the cost and how they impact the length of a newspaper subscription can be critical, legally. These legal issues were brought into sharp focus in a recent lawsuit.

On the evening of Monday, Sept. 25, the U.S. Senate voted 49 to 47 to confirm William Emanuel to the National Labor Relations Board.