Does misclassification violate National Labor Relations Act?


The National Labor Relations Board is inviting [PDF] interested parties to file briefs on an important question:

"Under what circumstances, if any, should the Board deem an employer’s act of misclassifying statutory employees as independent contractors a violation of Section 8(a)(1) of the Act?"

UPDATE: Briefs from parties and interested amici must be submitted on or before April 30, 2018

In Velox Express, Inc. an administrative law judge found [PDF] that an employer operating a courier service had misclassified some of its drivers as independent contractors when they should have been classified as employees. An important point, because employees benefit from protections in the National Labor Relations Act but independent contractors do not.

The administrative law judge then went one step further by finding that the employer's misclassification itself was a violation of Section 8(a)(1) of the NLRA. The ALJ put it this way:

"By misclassifying its drivers, Velox restrained and interfered with their ability to engage in protected activity by effectively telling them that they are not protected by Section 7 and thus could be disciplined or discharged for trying to form, join or assist a union or act together with other employees for their benefit and protection."

The employer's position is that the mere misclassification as an independent contractor, without more, is not a violation of Section 8(a)(1).

There has already been a turn in the approach taken by the Board's General Counsel(s). In 2016 Democrat GC Richard F. Griffin, Jr. was pushing [PDF] for a rule that misclassification was pretty much automatically an unfair labor practice, but in late 2017 Republican GC Peter B. Robb signaled [PDF] a pullback from that position.

I have no doubt that the soon-to-be-reestablished Republican Board majority will not hold that misclassification per se is an unfair labor practice. They might go so far as to say it's an unfair labor practice to misclassify – with knowledge that people who were obviously employees were being classified as independent contractors – if the employer's purpose was to deny Section 7 rights to employees. However, we'll have to wait and see.

Meanwhile, you have until April 30 to file an amicus brief.