Teamsters fighting deal between Amazon and NLRB on joint employer status

In the second legal action this week, a federal circuit court decision could be seen on a microeconomic basis as a victory. But the win didn’t do anything to push back against a decision last month that undercut the so-called Cemex precedent, an NLRB decision from the Biden administration that on the surface should make organizing easier, not just for the Teamsters but for all unions, now in danger of disappearing.

An ‘ambush’

In the case involving the question of Amazon (NASDAQ: AMZN) being a joint employer, lawyers for the Teamsters filed a letter with the agency objecting to a reported agreement between the NLRB’s General Counsel and Amazon that would end the process involving a former West Coast DSP called Battle Tested Strategies (BTS). 

BTS is the only known DSP that after being confronted with a successful Teamsters organizing drive among its workers chose to recognize the union. BTS lost its contract to deliver parcels and products out of Amazon’s Palmdale, California warehouse in Los Angeles county soon after the recognition. The company has said the ending of BTS’ contract was not related to the union recognition decision.

Preliminary findings by judges in the complicated NLRB pathway to the full board found that Amazon was a joint employer, a conclusion that if upheld could have major ramifications on the model that governs relations between Amazon and the DSPs. And the case had been going the Teamsters’ direction in other ways; an attempt by Amazon to stop the proceedings before a Los Angeles administrative law judge was rejected late last year. 

Oral arguments in that case were heard back in September. 

In a filing earlier this week with the NLRB, Teamsters attorneys described the deal between the counsel and Amazon as an “ambush settlement agreement,” dropped to the Teamsters on April 10 and then modified on April 12. 

While the specifics of the deal are not spelled out in the Teamsters’ brief, and there are no other documents in the docket that elaborate on the agreement, a Bloomberg article from April 13 first reported its existence.

“The federal government is moving to settle a yearlong case of Amazon’s treatment of a group of delivery drivers, averting what could have been a landmark ruling establishing the company as the boss of some of the workers it has long insisted aren’t its employees,” Bloomberg reported.

Two weeks pay for about 80 workers

Under the terms of the deal, according to Bloomberg, the workers at BTS, which could total as many as 84, would receive two weeks pay “without admitting wrongdoing or being found liable as a joint employer.”

If the case ends with the settlement, the earlier regional NLRB finding that Amazon is a joint employer–a clear victory for the union but one that was relatively early in the NLRB process–would have little to no lasting impact.

A spokeswoman for the Teamsters said the union would not comment on the case at this time. An Amazon representative had not returned an email by publication time.

The Teamsters’ filing with the NLRB cites a long list of actions involving Amazon at NLRB that the union says “illustrate Amazon’s contempt for the (National Labor Relations) Act, its determination to escape its legal obligations and its recidivist nature. This is the exact type of employer who requires a formal settlement to ensure compliance and further the Act’s purposes.”

The settlement between the General Counsel and Amazon, the Teamsters brief says, “completely lets Amazon off the hook on the joint employer issue.”

A win, but not with legs

Meanwhile, the action out of the Ninth Circuit was, in the short term, a victory for the Teamsters attempting to organize drivers with Cemex Construction Materials Pacific.  

The Ninth Circuit upheld an earlier NLRB decision that ordered Cemex to bargain with the union. The Teamsters had not won a traditional election at Cemex. Instead, it had used the submission of a majority of cards declaring employee support for the union as its path to recognition, a process often referred to as “card check.” 

In finding that Cemex committed a series of unfair labor practices, the NLRB in 2023 handed down remedies that also included provisions giving more weight to card check as a way to be granted company recognition of a bargaining unit.

But those provisions took a significant blow last month in the Sixth Circuit, when an appellate court ruled the NLRB had exceeded its authority in establishing the Cemex precedent.

The Cemex case before the Ninth Circuit was a victory for the Teamsters in that the court upheld the NLRB decision and affirmed that Cemex’ anti-union activities constituted unfair labor practices.

But in a blog posting by labor-focused law firm CDF, which specializes in California issues, the firm said the decision was “impactful, but notably unfinished.”

“What is notable is what the court didn’t do,” CDF said. “It declined to address the board’s new Cemex framework altogether.”

The earlier order by the NLRB directed against Cemex was made under a precedent known as Gissel. Doing so was easy, CDF said, because Cemex’ violations of its employee rights were so egregious. Gissel allows the NLRB to order several remediation steps when an employer is found to have committed unfair labor practices.

Two circuits might have been in conflict

But the Ninth Circuit in the Cemex case didn’t take up the precedent set in March by the Sixth Circuit. “The court sidestepped the issue entirely and affirmed the bargaining order under the Gissel standard alone,” the law firm said. “This is a classic appellate move: decide the case on narrower, settled grounds and avoid stepping into a doctrinal fight.”

In the long term, CDF said, “the issue is likely heading toward a circuit split showdown and will likely result in Supreme Court involvement.”

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