NLRB v. Labor Ready, Inc.: Court Grants Broader Protections to Temporary Employees

IMMIGRANTS & EMPLOYMENT

Immigrants' Employment Rights and Remedies

NLRB V. LABOR READY, INC.: COURT GRANTS BROADER PROTECTIONS TO TEMPORARY EMPLOYEES
Immigrants' Rights Update, Vol. 15, No. 4, June 29, 2001

The Fourth Circuit Court of Appeals has granted a petition filed by the National Labor Relations Board (NLRB) asking that its order against Labor Ready, a temporary employment agency with nationwide operations, be enforced. The court determined that certain workers whom the agency had treated as "nonemployees" were indeed employees of the agency and that Labor Ready's policy of prohibiting workers from engaging in any form of solicitation or from distributing literature on its premises is invalid because it interferes with employees' right to engage in concerted activities under the National Labor Relations Act (NLRA).

The court found that Labor Ready classifies workers as either new job applicants or "nonemployees." The latter are workers who have a job application already on file with the agency and who go there whenever they are seeking work. The complaint that resulted in this litigation was precipitated after a Labor Ready office in West Virginia began requiring workers to report to the agency early in the morning for job assignments. Four workers, one of whom was also an employee of the Affiliated Construction Trades Foundation, began circulating a petition at Labor Ready's offices requesting that the agency resume its former practice of giving assignments by telephone rather than requiring workers to appear in person. Labor Ready's management attempted to prohibit the workers from circulating the petition, but the workers asserted that their activities were protected by the NLRA. Over the next two months, Labor Ready installed a surveillance camera that recorded these workers' activities, and ultimately the agency blacklisted the worker it considered to be the leader of the effort, permanently barring him from all of Labor Ready's offices across the country as well.

Labor Ready argued that its express contract states workers are "deemed to have quit" each evening and that the employment relationship between the agency and the worker is not renewed until the worker receives another job assignment. However, the court held that under the NLRA an individual's status as an "employee" can continue between job assignments, even where there is no formal obligation of the employer or employee to continue in that relationship. Second, the court stated that another factor that determines workers' "employee" status is if they are "customarily continued in their employment with recognition of their preferential claims to their jobs." Although most job assignments through Labor Ready are too brief to allow workers to have preferential rights to a job, the court found other evidence of "employee" status, including the fact that these workers often perform a particular job for several consecutive days and are allowed to keep the equipment they use beyond the duration of their job assignment, as was the case with the complainant in this case.

Finally, the court held that because Labor Ready required workers to be physically present in order to receive job assignments, such control over the workers was evidence that an employment relationship did exist between the agency and the workers. Affirming the NLRB's order finding that these workers were employees and therefore protected by the NLRA, the court also affirmed the remedies ordered, which include a nationwide prohibition against Labor Ready's practice of restricting employees' rights to engage in solicitation, a prohibition against video surveillance of employees, reinstatement of the main complainant with back pay, and a requirement that the agency post an announcement informing its workers about their rights under the order.

NLRB v. Labor Ready, Inc., No. 00-2064, 2001 U.S. App. LEXIS 11377 (4th Cir. June 1, 2001).