Gallagher Bassett We Guide. We Guard. We Go Beyond.

LEAD STORY

The National Labor Relations Board (NLRB) reset the standard for determining whether two companies shall be deemed "joint employers" under the federal Fair Labor Standards Act (FLSA). In a 3-2 decision, the NLRB overturned the 2015 Browning-Ferris Industries decision and returned to the "direct control" standard set before that Obama-era decision. The decision marks the latest move by federal regulators to roll back worker-friendly rules enacted during the Obama administration.

INDIRECT VS. DIRECT

According to the NLRB, a company will only be deemed a joint employer if it exercised direct control over employment terms of that employee. Under the previous Browning-Ferris standard, a joint-employer relationship existed when two employers co-determined meaningful terms of employment. The two sides of the issue have argued for guidance in the test control. The debate has centered in the area of collective bargaining agreements among franchised restaurants, where the impact of joint employment has far-reaching effects. A company found to be a joint employer would be required to bargain with unions and would be liable for labor law violations by contractors, even in the context of franchising arrangements or contracted labor.

A COMMUNITY OF INTEREST

The NLRB also reversed the 2011 Obama-era board decision, Specialty Healthcare and Rehabilitation Center of Mobile. Again, in a 3-2 decision, the Trump administration's NLRB eliminated the concept of "micro-units" and reinstated the traditional "community of interest test" for use in determining the appropriate bargaining unit in representation cases. The newly-readopted test considers factors such as functional integration, employee skill, employee interchangeability, working conditions, wages and benefits, common supervision, and bargaining history to determine whether a proposed unit of workers shares a community of interest for union organization.

ONE MORE EXTENSION

The U.S. Department of Labor's Occupational Safety and Health Administration (OSHA) will continue accepting 2016 OSHA Form 300A data through the Injury Tracking Application (ITA) until midnight on December 31, 2017. OSHA will not take enforcement action against those employers who submit their reports after the December 15, 2017, deadline but before December 31, 2017, final entry date. We will continue to track the administration's regulatory rollback across all industry sectors in 2018. On deck - transportation. 

Tips and Gratuity

POOLING

The U.S. Department of Labor (DOL) announced a Notice of Proposed Rulemaking (NPRM) regarding tips and gratuity regulations under the FLSA. The NPRM is now published in the Federal Register and the DOL will take public comment through January 4, 2018. Under the proposed rule, workplaces would have the freedom to allow sharing of tips among more restaurant employees. The proposal would help decrease wage disparities between tipped and non-tipped workers.

OPPONENTS

However, opponents of the measure fear it will lead to employers reclaiming shared tip money. Employers would have the right to decide what to do with the tips. In fact, if the proposal becomes law, employers would be in charge of nearly $6 billion of workers' tips nationwide, according to an estimate from the Economic Policy Institute. 

Making Our Way Around the Country

TENNESSEE

The Tennessee Bureau of Workers' Compensation issued its final rule on electronic provider billing. The Volunteer state will join a handful of states that mandate workers' compensation payers and providers to invoice and pay medical bills electronically. The e-billing program, which will be implemented by July 1, 2018, stems from the state's Workers' Compensation Reform Act of 2013.

CALIFORNIA

The California State Auditor presented to the state legislature a report concerning public agencies' processes for preventing, detecting, and prosecuting fraud occurring in California's workers' compensation system. The report concludes the state needs to strengthen its efforts to reduce workers' compensation fraud. The State Auditor concluded that the California Department of Insurance (CDI) closes only 40 percent of the workers' compensation referrals it receives without investigation due to insufficient investigative and prosecutorial resources.

NEW JERSEY

The New Jersey Supreme Court ruled that an employment contract limiting a worker's right to sue a third party after an injury is unenforceable. The court, in a unanimous ruling, said such waiver provisions run afoul of the public policy of protecting employees' rights and the plain language of the Workers' Compensation Act. The court reasoned that, although an employee injured on the job might receive workers' compensation benefits, the law does not bar him or her from suing a third party.

A LABOR OF LOVE

As we close 2017, we truly thank you for your support, readership, and feedback all year. It is our absolute privilege to bring you The Way each week. Today marks our 100^th edition, and we're just getting started! But first, we rest. We are off next week for the Holidays. We will be back on January 3^rd, as we begin our third year of reporting to you from the intersection of governmental affairs and the risk and insurance industry. From all of us here, we wish you and yours the best for the holiday season and hope that you are already on your way to a healthy and prosperous New Year.