New England Biz Law Update
A June decision by the National Labor Relations Board (NLRB) could make it easier for workers to be classified as employees rather than independent contractors.
The board’s ruling in Atlanta Opera, Inc. and Make-Up Artists and Hair Stylists Union, Local 798, IATSE marks a return to a previous test for worker classification.
In the decision, the NLRB returns to the 2014 FedEx II standard for determining independent contractor status under the National Labor Relations Act (NLRA). This is a departure from the Trump-era SuperShuttle standard that was generally considered more employer-friendly.
The NLRB’s decision was nearly unanimous. Marvin Kaplan, the board’s lone Republican member, agreed with the majority in finding that Atlanta Opera’s hair and makeup artists were employees, not independent contractors, and were therefore permitted to unionize under the NLRA. However, he dissented from overruling the SuperShuttle standard.
In SuperShuttle, the Republican-led board held that employee/independent contractor assessments should consider a worker’s entrepreneurial opportunity as the “animating principle” of their assessment. In Atlanta Opera, the Democrat-led board determined that the board should consider whether a worker “is, in fact, rendering services as part of an independent business.” In both cases, all other standard factors, e.g., extent of control, supervision, skills, payment method, etc., still applied.
In its Atlanta Opera decision, the board explained that an assessment “should give weight to actual, but not merely theoretical, entrepreneurial opportunity, and it should necessarily evaluate the constraints imposed by a company on the individual’s ability to pursue this opportunity.”
Background
In spring 2021, the hair, wig, and makeup artists of The Atlanta Opera voted on whether they wanted to be represented by IATSE Local 798. The Atlanta Opera sought to block the vote by arguing that the workers were independent contractors, not employees. As such the ballots were impounded for nearly two years.
According to the IATSE, those ballots were unsealed in March this year and revealed the artists had unanimously voted to unionize. In June, the IATSE reported they were already near to securing a collective bargaining agreement with the opera.
Next steps
Overall, the NLRB’s decision in Atlanta Opera has implications for worker classification as employees or independent contractors and the ability to unionize. It signifies a shift in favor of employee status and could have an impact on the gig economy.
Classifying workers can be a complicated process, with significant legal implications. Employers who make use of independent contractors are encouraged to audit their workforce.
