From 1984 until Aug. 27, 2015, the National Labor Relations Board standard for who could be characterized as a “joint employer”—that is, two or more entities legally charged with responsibility for employment duties, payments, taxes and labor law violations—was fixed and unwavering. Only if an entity exercised actual control over employees, as opposed to merely possessing a reserved but unexercised right to exert control, would joint employer status result. The two principal cases expounding this principle are Laerco Transportation, 269 NLRB 324 (1984) and TLI, Inc., 271 NLRB 798 (1984).

But on Aug. 27, 2015, the NLRB promulgated its now rather infamous decision in Browning-Ferris Industries of California, Inc. et al., 362 NLRB 186 (2015), which—at the instigation of labor unions and the Obama-era NLRB General Counsel—held that two or more entities would be deemed joint employers of the same employee if they merely possessed some reserved authority to control the terms and conditions of employment, even if never exercised. This approach was driven by the politics of “income inequality,” calls for an increase in the minimum wage, and an attempt by unions to have franchisors declared the joint employer of their franchisees’ employees, which would make them the economic “bargaining units” with which unions could negotiate their franchisees’ employees’ salaries and benefits.