United States: NLRB General Counsel Acknowledges Legal Stumbling Block In Joint Employment Issue, Highlights Priorities

Last Updated: October 30 2014
Article by Michael J. Lotito

Speaking at a West Virginia University College of Law event last week, National Labor Relations Board General Counsel Richard F. Griffin, Jr. pointed out the pitfalls in his office's argument that franchisors should be named in unfair labor practice charge complaints as joint employers with their franchisees. According to Griffin, "we have a problem legally for our theory." In July, Griffin surprised many by announcing that his office intends to name a parent franchisor as a respondent in cases involving alleged unfair labor practices committed by franchisees if a settlement is not reached. This decision caused an uproar in the business community – as discussed extensively during a September congressional subcommittee hearing – because it would make significant changes to the franchise model. 

In the Browning Ferris case, the Board asked for briefing on whether the current joint employment standard under the National Labor Relations Act should be changed, and if so, what should it be? The GC said that his office filed a brief arguing that the standard – in place since 1984 – should be changed back to the "traditional" approach. Under the standard in place for the past 30 years, whether an employer is considered a joint employer depends on whether it exerts a significant and direct degree of control over employees and the employees' essential terms and conditions of employment. Prior to 1984, the GC asserted, an employer was also considered a joint employer if it "had the potential" to control such terms and conditions of employment, or if "industrial realities" otherwise made it an essential party to meaningful collective bargaining.  

Griffin advocated returning to the earlier standard because of the "changing nature of employment." Specifically, the GC said that the nature of today's contingent workforce and the franchise industry necessitates this change.  Griffin acknowledged that following his office's July announcement that he would be authorizing complaints against franchisors as joint employers, "a lot of noise" was created.  The GC then pointed out  that prior Board decisions issued under the "traditional" joint employer standard do not support his position. He explained that case law exists in which parties argued that franchisors were joint employers with their franchisees: 

and the Board said "no." Even under the old test. And they established essentially this principle that if the franchisor's involvement in indirect involvement in the terms and conditions of employment comes about as the result of the franchisor trying to protect the uniformity and quality of their brand, that's insufficient involvement to get them as joint employers. So here we are arguing for a return to the traditional standard and here are these cases that under the traditional standard find no joint employer in the franchisor-franchisee relationship. And we say "don't overrule those cases, those cases should remain good law." But, one thing that had come to our attention in the course of a bunch of cases . . . .there is now a lot more involvement in certain contexts of franchisors with the day-to-day operations with their franchisees. 

Specifically, Griffin alleged that because there exists "enormous software capability" allowing franchisors to monitor their franchisees "in real time," the standard should be changed. According to Griffin, this type of involvement in the hours and terms and conditions of employment "goes beyond protecting the brand. . . In those instances we think the franchisor should be named and held responsible as a joint employer."

Other Pending Issues

Griffin touched upon three other issues currently pending before the Board.  First, he advocated overturning Register Guard via the Purple Communications matter, in which the Board has called for public briefing.  Under existing law, employees do not have a Section 7 right to use their employers' computer system to engage in union activities.  Griffin said his office has taken the position that this precedent should be overturned, and instead the Board should apply the Republican Aviation analysis, which balances an employee's Section 7 rights against an employer's property rights. He said he has not "necessarily" taken the position that if an employer allows employees to use its computer system for personal use, it must then allow employees to use the computer system for Section 7 activity.  

Another issue Griffin highlighted during his talk was the inability to pay argument.  Under this doctrine, if a union makes a financial demand during collective bargaining and the employer says it cannot pay the amount demanded, an employer must open its books to the union if requested.  However, this requirement is not triggered in certain circumstances, such as when an employer alleges it does not want to pay the amount for various business reasons.  According to Griffin, this type of "semantic distinction" has been criticized, and he would like to change this policy. He noted, however, that a case that would have squarely addressed this issue was settled about two weeks ago, and similar cases have not yet "reached fruition." 

Finally, Griffin stated was a "big believer in 10(j) injunctive relief," particularly in successorship cases. "Successorship/refusal to hire is now a 10(j) priority and we will be chasing those cases the same way we are . . .going after first contract bad faith bargaining and 'nip-in-the-bud' organizing." 

New Role as General Counsel

As many who read this blog already know, Griffin was one of the contentious Board recess appointees who stepped down as part of the 2013 Senate deal that resulted in the approval of all five current Board members. Shortly after leaving the Board as a member, Griffin was confirmed as the agency's General Counsel. Griffin remarked, "apparently the Senate seemed to think that while I was inappropriate for confirmation as a Board member, I was perfectly fine to be confirmed as the General Counsel – a  position which, frankly, is a much more responsible position."   

Griffin's tenure as GC has likewise been contentious at times. Last month, a group of senators introduced legislation that would, among other things, provide for independent judicial review of the General Counsel's decision to issue a complaint, give parties 30 days to seek review of a General Counsel's complaint in federal district court, and grant parties the right to obtain General Counsel memoranda and all relevant documents within 10 days of receiving a complaint.  That bill is still pending.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Michael J. Lotito
Similar Articles
Relevancy Powered by MondaqAI
Sheppard Mullin Richter & Hampton
In association with
Related Topics
Similar Articles
Relevancy Powered by MondaqAI
Sheppard Mullin Richter & Hampton
Related Articles
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions