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NLRB changes definition of “independent contractor”

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By broadening the standard for who is considered an independent contractor under the National Labor Relations Act (NLRA), the National Labor Relations Board (NLRB) has reduced the number of individuals who may unionize or bring unfair labor practice charges. Unlike employees, independent contractors are not protected by the act.

In the Jan. 25 SuperShuttle DFW Inc. decision, the board overturned a 2014 NLRB decision that made classification as an independent contractor harder to achieve. The overturned decision didn't rely solely on a host of common-law factors but focused on economic realities, such as whether a worker is economically dependent on a company, in determining whether someone is an independent contractor. Under the 2014 test, if the worker was economically dependent, that worker likely would have been found to be an employee rather than an independent contractor, explained David Pryzbylski, an attorney with Barnes & Thornburg in Indianapolis.

Now the board has returned to the common-law test it used for years before the 2014 decision. This test takes into account a variety of factors, including the relationship the company and individual think they are creating and how much control the company has over the person's work.

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