Bloomberg Law
May 3, 2023, 2:56 PM

New Joint Employer Rule to Test Tech Companies’ Union Playbook

Parker Purifoy
Parker Purifoy

A landmark union victory at YouTube Music, along with pending changes to a federal joint-employer rule, may force tech companies to reconsider relationships with contractors and staffing agencies.

Workers at YouTube Music voted unanimously to unionize with the Alphabet Workers Union, a Communications Workers of America affiliate, which will force Google and its parent company, Alphabet Inc., into contract negotiations with a union for the first time in its history.

The Texas-based workers are directly employed by staffing agency Cognizant Technology Solutions Corp., but a National Labor Relations Board regional director ruled in March that Google has enough control over them to be considered a joint employer.

Joint-employer rules have fluctuated over the decades but the newest NLRB rule, combined with a nationwide jump in union activity, could prove particularly impactful. The successful union drive at YouTube Music announced April 26 is the latest sign that organized labor is gaining more of a foothold in big tech, legal observers say.

“Companies are going to be watching this very closely,” Daniel Altchek, a partner at Saul Ewing LLP, said of the recent YouTube election. “They may not make any dramatic changes yet, but if this rule is finalized, then we could start seeing some changes.”

The labor board plans to release its regulation governing how to determine when multiple companies jointly employ workers for purposes of federal labor law by August, it told a federal district court earlier this year.

The proposed rule would expand the number of factors used to establish a joint employment relationship. Companies would be considered joint employers if they co-determine “essential terms and conditions of employment,” such as scheduling, wages, and benefits. The proposal, which would rescind the Trump-era rule that took effect in April 2020, drew 13,000 public comments last year.

The joint employer issue has been hotly debated over the past decade, most directly affecting franchise companies, gig economy firms, and other businesses that rely on non-employee labor.

Relationships with contractors and temporary workers have exploded in recent years in the tech industry, which means it will be heavily impacted by the NLRB’s new joint-employer rule, according to Altchek.

Altchek said the union victory at YouTube, coupled with historic layoffs in the industry, could give workers at other big tech companies the incentive to formalize their organizing campaigns through a representation election.

“I would not be surprised if this kind of landmark milestone for the union sparks momentum for other workers, and I think we could see a lot more unionizing activity at companies that have extensive contractor arrangements like Google,” he said.

Alphabet workers have been organizing since 2018 and officially formed AWU in 2021, citing conditions for contract and temp workers as one of their main areas of concern.

Hands-On or Hands-Off?

Supporters of the NLRB’s new proposed joint employer rule have argued that the revision is crucial for holding big corporations responsible for how they treat workers.

“Outsourcing, subcontracting and franchising arrangements should not be a way for employers to undermine basic workers’ rights,” Rebecca Givan, associate professor of labor studies at Rutgers University, said in an emailed statement. “The NLRB can play a key role in ensuring that workers have the right to organize no matter where they work.”

But Todd Lebowitz, partner at BakerHostetler, said the rule change puts companies “in a real bind.”

Employers can choose to distance themselves now from decisions involving temp workers to avoid becoming a joint employer, but if these measures don’t meet future board standards under the new rule, the company may be forced into an unpredictable bargaining process, Lebowitz said.

“If the Board says there’s joint employment and then the temps vote to unionize, the company may be forced to bargain over those same wages and benefits,” he said. “Refusal to bargain over wages and benefits could be an unfair labor practice, but if the company does play a role in setting temps’ wages and benefits, the company may be opening itself up to joint employer liability under the Fair Labor Standards Act too.”

Google attempted to avoid joint-employer status by arguing that it doesn’t have direct control over the YouTube workers. But NLRB Regional Director Timothy Watson in Fort Worth, Texas, dismissed these claims under the Trump-era policy, saying the tech giant controls wages, benefits, and working conditions by setting minimum standards for contractors. Google has asked for a review of the regional director’s decision but the case is pending before the board.

Compliance with NLRB joint-employer policies can be “a moving target,” Lebowitz said, but he recommends that companies avoid setting the wages and benefits of contract and temporary employees. They should also avoid supervising or controlling the terms of the workers’ employment.

“When temps are commingled with full-time staff and doing the same thing under the same supervisors, it’s hard to avoid joint employment,” he said. “On the other hand, if temps work separately from full-time staff and report to a temp agency supervisor who directs their work, it’s more likely that joint employment can be avoided.”

Altchek said some companies may decide to ditch contractors altogether, choosing instead to directly hire and employ their workers.

“If I’m going to have an employer-type of designation forced on me by the NLRB, maybe I should just be the employer from the start,” he said. “As an employer, you want to have some kind of control and if you’re completely hands-off to avoid a joint-employer relationship, then maybe you’re giving up too much control.”

To contact the reporter on this story: Parker Purifoy in Washington at

To contact the editors responsible for this story: Rebekah Mintzer at; Genevieve Douglas at

Learn more about Bloomberg Law or Log In to keep reading:

Learn About Bloomberg Law

AI-powered legal analytics, workflow tools and premium legal & business news.

Already a subscriber?

Log in to keep reading or access research tools.