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Law Alert: NLRB Re-Focuses Its Independent Contractor Test

by Gregory M. Feary, A. Jack Finklea, James H. Hanson, Donald J. Vogel

January 26, 2019

 

NLRB Re-Focuses Its Independent Contractor Test

The National Labor Relations Board on Friday determined that van drivers franchised with SuperShuttle DFW, Inc., were properly classified as independent contractors rather than employees. In so holding, the Board expressly overruled the test set forth in its 2014 FedEx Home Delivery decision. According to the Board, the 2014 standard incorrectly minimized the role of “entrepreneurial opportunity” in evaluating whether a driver was an independent contractor. The proper standard, on the other hand, uses the presence or absence of entrepreneurial opportunity (the opportunity to earn a profit or suffer a loss) as an important lens to examine each aspect of the relationship. 

The Board’s re-focusing of the independent contractor analysis is important, as motor carriers can often show driver freedom through entrepreneurial opportunity. For example, entrepreneurial opportunity is highlighted in a driver’s freedom to decide what days to work, which trips to accept, the carriers to which they will provide service on a given day, whether to lease or purchase the vehicle they drive, and even maintenance schedules and fueling programs to be used. What is more, to the extent an independent contractor relationship is established, no right to union organizing or other concerted activity exists.

For more information on the Board’s decision and how the re-focused test may be applied to particular circumstances, feel free to reach out to Greg Feary, Jack Finklea, Jim Hanson, or Don Vogel.

 

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Scopelitis Transportation Law Alerts are intended as a report to our clients and friends on legal developments affecting the transportation industry. The published material does not constitute an exhaustive legal study and should not be regarded or relied upon as individual legal advice or opinion.

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