NLRB Quick to Conclude Independent Contractors are Employees

The National Labor Relations Board filed a complaint against Postmates, Inc., an on-demand company, similar to Uber, that has a network of couriers delivering goods. The complaint alleges that Postmate’s violated the National Labor Relations Act by requiring employee drivers to enter into arbitration agreements as a term of employment. The complaint further alleged that Postmates interfered with the Section 7 rights of Customer Service Associates (CSA) by prohibiting them from discussing terms and conditions of employment.

While the NLRB has made clear that misclassification of independent contractors could result in an unfair labor practice, in this case the NLRB simply assumed that Postmates’ couriers are employees, rather than independent contractors, without holding a hearing or allowing any briefing on the issue. This is significant because the NLRB does not have jurisdiction to file complaints on behalf of independent contractors.

The Postmates complaint should put employers utilizing independent contractors on notice that the NLRB will likely gloss over the employer’s characterization of independent contractor status and file a complaint when it believes that worker are “employees” under the National Labor Relations Act, and that a violation of the Act has occurred. 

As a result, employers in the on-demand economy should: 1) make sure that their classification of couriers as independent contractors is consistent with the law; and 2) avoid having overly-broad or vaguely defined employment policies that could be interpreted to infringe on the Section 7 rights of potential employees. This “belt and suspenders” approach could help on-demand companies avoid lengthy and costly battles at the NLRB.

Matt Austin is a lawyer based in the Columbus, Ohio office of Roetzel & Andress, LPA who limits his practice to representing employers dealing with labor, employment, and OSHA matters. You can call Matt at (614) 723-2010 or email him at maustin@ralaw.com.

h/t Seyfarth Shaw’s Employer Labor Relations Blog

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