The Hill

Labor agency bucks courts to attack independent workers

Published in The Hill
January 22, 2022
By F. Vincent Vernuccio, president of the Institute for the American Worker and senior labor policy adviser for Workers for Opportunity

A federal agency responsible for administering labor laws is going after independent workers — again.

The National Labor Relations Board (NLRB) recently took steps toward redefining who is an independent contractor and who is an employee. The move could limit self-employment options, making it harder for independent contractors to work for themselves. The change also would clear the way for unions to organize these workers, since entrepreneurs would get swept under the same legal status as employees. And that’s likely the real motivation.

Keep in mind that most of the board’s members align with President Biden. The party of the president is allowed to select three of the board’s five total members. So, unlike courts, the NLRB issues decisions that can swing wildly depending upon who is president.

It’s easy to see, then, why the board has been accused of bias since its inception. As far back as 1937, one senator called it a “kangaroo court,” reprimanding the board for its partisanship. And, as the issue of defining independent contractors shows, partisanship persists today.

Biden’s National Labor Relations Board isn’t the first to target independent workers. The board under President Barack Obama also tried limiting self-employment options, and federal courts rebuked it — not once, but twice.

The court wrote in the first case that the board has “no authority whatsoever” over independent contractors. It reminded board members that their powers extended only to “the channels intended by Congress.”

But getting slapped down once wasn’t enough. The Obama board ignored the first court decision, leading to another rebuke from the D.C. Circuit. The Court of Appeals upheld the previous decision, reiterating the importance of “stability, consistency and evenhandedness” in circuit law. “The same issue … in the same court should lead to the same result,” the court emphasized.

By upholding the 50-year-old standard on who qualifies as an employee and who counts as a contractor, the courts protected the best interests of self-employed workers and pushed back against the partisan forces at play.

Subsequent board members have also criticized partisan efforts to recast independent contractors as employees. When the board under President Donald Trump issued a decision that upheld precedent, it made a point of shaming previous attempts to “fundamentally” redefine independent contractors for “implicit policy-based reasons.”

It was fair criticism. The board under Obama was ready and willing to abandon precedent to serve its pro-union policy agenda. Perhaps that’s why a 2016 report from the Coalition for a Democratic Workplace asked if Obama’s NLRB was “the most partisan board in history,” suggesting it had “upended 4,559 years of precedent.”

And yet somehow — despite precedent, and despite consistent criticism of the board’s attempts at mission creep — here we are again.

Biden’s National Labor Relations Board is stepping in right where the highly criticized Obama board left off. Rather than aiming for consistency, it’s aiming for outcomes. In this instance, those outcomes would benefit the same organized labor executives who backed Biden’s presidential campaign.

The move signals that union interests may be driving decision-making through regulation, rather than legislation — an unsettling prospect. And if true, it also exposes the board’s apparent willingness to thumb its nose at decades of established law, which is no small matter.

The National Labor Relations Board must aim for consistency. It must respect its history. And it must restrain its reach to the boundaries defined by Congress. When partisanship blinds board members’ judgment, it’s not just the agency’s reputation that suffers. America’s independent workers also get hurt.

F. Vincent Vernuccio is president of Institute for the American Worker and a senior labor policy adviser for Workers for Opportunity.