RELEASE -- Misclassifying Workers as Independent Contractors Does Not Violate the Act

Office of Congressional and Public Affairs

Misclassifying Workers as

Independent Contractors Does Not Violate the Act

WASHINGTON, DC, August 29, 2019 – The National Labor Relations Board held that employers do not violate the National Labor Relations Act (NLRA) solely by misclassifying employees as independent contractors. The Board majority held that an employer’s communication to its workers of its opinion that they are independent contractors does not, standing alone, violate the NLRA if that opinion turns out to be mistaken. According to the decision, such communication does not inherently threaten those employees with termination or other adverse action if they engage in activities protected by the NLRA, nor does it communicate that it would be futile for them to engage in such activities.

The case is Velox Express, Inc., 15-CA-184006, 368 NLRB No. 61. On Feb. 15, 2018, the Board requested briefing in this case on the issue of whether employee misclassifications should be a violation of the NLRA. In response, the General Counsel, the Respondent and the Charging Party each filed a brief; 13 additional briefs were received from 28 amici. 

In Velox Express, the Board applied its recent decision in SuperShuttle DFW, Inc., 367 NLRB No. 75 (2019), to find that the workers were employees, not independent contractors, and thus protected by the NLRA. Based on that determination, it held that the employer violated the NLRA when it discharged one of these employees for bringing to management’s attention group complaints about the way the employer was treating its workers. The Board majority held, however, that the employer’s misclassification of its employees as independent contractors was not a separate violation. 

Chairman John F. Ring was joined by Members Marvin E. Kaplan and William J. Emanuel in the majority opinion. Member Lauren McFerran dissented from the portion of the decision holding that misclassification is not a separate violation. 

Established in 1935, the National Labor Relations Board is an independent federal agency that protects employees and employers from unfair labor practices and protects the right of private sector employees to join together, with or without a union, to improve wages, benefits and working conditions. The NLRB conducts hundreds of workplace elections and investigates thousands of unfair labor practice charges each year.