U.S. Labor Board prosecutor hopes to bulk up staffing, budget as gig worker scrutiny grows By Reuters

By Nandita Bose

WASHINGTON (Reuters) – The top prosecutor at the National Labor Relations Board (NLRB), the U.S. agency that investigates unfair labor practices, is pushing for a bigger budget and more staff, he told Reuters, adding he would not be surprised to see a jump in complaints about employees being misclassified as contractors.

Peter Sung Ohr, the acting general counsel at the labor board, is pushing to increase the agency’s annual budget for fiscal year 2022 by 10% and to add over 150 more employees to its offices, to prosecute U.S. labor law violations.

In a rare interview, Ohr told Reuters he would not be surprised to see a jump in complaints about employees being misclassified as contractors. Misclassification of employees is an issue that “comes up on a regular basis” Ohr said, and as the economy evolves he expects to see the issue becoming “more common.”

“It will not be a surprise if we continue to see more of these issues come in front of the National Labor Relations Board,” said Ohr.

The issue of employee misclassification looms large for rideshare and other “gig economy” companies, including Uber (NYSE:) Inc and Lyft (NASDAQ:), that rely on contract labor instead of paying overtime and benefits. The industry is under pressure from Democratic President Joe Biden’s administration, which has increasingly pushed for more rights for workers and to ease their ability to join unions.

Ohr, a career employee with the NLRB and former regional director for the agency in Chicago, noted that when such cases come up around the country, they can be “consolidated and looked at in a national scope.”

“That certainly happened in the last administration with Uber,” he said, referring to misclassification complaints that came up in Chicago and San Francisco when Republican President Donald Trump was in office.

Biden named Ohr, who may be best known for ruling in 2014 that Northwestern (NASDAQ:) University football players were employees with the legal right to unionize, immediately after taking office in January as he fired his predecessor, Peter Robb, Trump’s appointee to the post. Jennifer Abruzzo, Biden’s nominee for general counsel, awaits confirmation from the U.S. Senate.

Ohr’s comments on employee misclassification came after the U.S. Labor Department blocked a rule in May which would have made it easier to classify gig workers as independent contractors. The NLRB and the Labor Department are separate agencies.

In April, Labor Secretary Marty Walsh told Reuters he supports classifying gig workers as employees who deserve work benefits, pushing down shares of companies like Uber and Lyft.

The Biden administration also recently pushed to boost the budget of a Labor Department unit that investigates whether gig workers are misclassified. Biden’s nominee to run that division has supported government crackdowns on the workforce models of gig-economy companies like Uber.

Biden’s American Jobs Plan legislation also helps to “fund the NLRB’s participation in a multi-year, multi-agency effort to combat misclassification of employees as independent contractors,” according to a budget document filed by the NLRB to Congress. Ohr did not offer more details on what that effort would entail.

Ohr did not comment on a high-profile case involving Amazon.com Inc (NASDAQ:), which is before the NLRB. The Retail Wholesale and Department Store Union is trying to persuade the labor board to throw out the results of a union election it lost in Alabama in early April by proving Amazon violated U.S. labor law.

There are ongoing legal challenges to Biden firing Robb and picking Ohr to lead the agency. The Department of Justice has recently filed a motion to intervene and argue on the legitimacy of Ohr’s appointment.

MORE RESOURCES

Ohr, whose appointment was seen as a step toward establishing a more union-friendly NLRB, said in some agency offices around the country the number of cases being filed with it have gone up, after a drop during the Trump years.

“In the last four or five months of this year … the drop in case intake has stopped,” Ohr said.

Ohr hopes to raise the budget from $274 million in fiscal year 2021 to over $310 million to boost staffing, raise outreach and awareness for the work the agency does and make improvements in technology. According to a report from the U.S. Government Accountability Office in March, the agency’s budget has declined 26% over the past decade. 

There has been a “significant drop” in staffing at the agency over the past three years, Ohr said. The latest budget requests 1,387 full-time employees, up from 1,223.

In fiscal year 2020, the agency conducted 1,165 elections to certify or decertify a union and investigated 16,519 charges, recovering over $40 million for workers.

Biden on Tuesday said he intends to nominate a senior union lawyer, David Prouty, to the NLRB and fill the seat currently held by Republican William Emanuel, an attorney who has represented employers in labor law cases.

The move follows his decision to nominate veteran union lawyer Gwynne Wilcox for a vacant seat on the NLRB. If both are confirmed, Democrats would take control of the five-member labor board.

Ohr said Democratic control would help get approvals for the budget and spending plans, adding that his goal is to support the mission of the National Labor Relations Act.

“It is a law written to support collective bargaining, to support employees,” Ohr said. “I want to make sure that we continue to do that … and that employers know that when there is a charge filed, the investigation is going to be neutral, unbiased,” he said.