Employment Law Daily 3-1 NLRB no longer requires employer permission for mixed bargaining unit of single and jointly employed workers
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Wednesday, July 13, 2016

3-1 NLRB no longer requires employer permission for mixed bargaining unit of single and jointly employed workers

By Ronald Miller, J.D. A union seeking to represent employees in bargaining units that combine both solely and jointly represented employees of a single user employer are no longer required to obtain employer permission, ruled a divided four-member panel of the NLRB in a 3-1 decision. In so ruling, the Board returned to the rule established in 2000’s M.B. Sturgis, Inc. and overruled Oakwood Care Center, a 2004 ruling. According to the Board a petitioned-for unit combining solely and jointly employed workers of a single user employer must share a community of interest in order for a single unit combining the two to be appropriate. The Board will apply the traditional community of interest factors for determining unit appropriateness. Member Miscimarra filed a separate dissenting opinion (Miller & Anderson, Inc., July 11, 2016). In its request for review of a regional director’s administrative dismissal of its petition to represent a unit of sheet metal workers employed by an employer and a labor supplier as either single employer or joint employers at various job sites in Pennsylvania, the union requested that the Board overturn Oakwood. The issue raised by the union’s request was whether employees who work for a user employer—both those employed by the user alone and those employees it jointly employs (along with a labor supplier)—must obtain employer consent if they wish to be represented for purposes of collective bargaining in a single unit, even if both groups of employees share a community of interest with one another under the Board’s traditional test for determining appropriate units. Return to Sturgis. In Oakwood, the Board held that bargaining units that combine employees who are solely employed by a user employer and employees who are jointly employed by that same user employer and an employer supplying employees to the user employer constitute multi-employer units, which are appropriate only with the consent of the parties. The Oakwood Board thereby overruled M. B. Sturgis, Inc., which had held that the NLRA permits such units without the consent of the user and supplier employers, provided the employees shared a community of interest. Finding that Sturgis was more consistent with the NLRB’s statutory charge, the Board overruled Oakwood and returned to the holding of Sturgis. The Board reasoned that employer consent is not necessary for units that combine jointly employed and solely employed employees of a single user employer. Instead, the Board will apply the traditional community of interest factors to decide if such units are appropriate. The Board also agreed with the Sturgis Board’s clarification that there is no statutory impediment to processing petitions that seek units composed only of the employees supplied to a single user, or that seek units of all the employees of a supplier employer and name only the supplier employer. Accordingly, the Board remanded the case to the regional director for further proceedings consistent with this decision. Common enterprise. After reviewing Board precedent and the courts’ historical treatment of combined units of jointly employed and solely employed employees, the Board turned to its own analysis of the issue. After examining the language of the NLRA, the Board concluded that the Act does not compel the holding in Oakwood that bargaining units combining solely employed and jointly employed employees are appropriate only with the consent of the user and supplier employers. Rather, the Board found that the Sturgis rule, not requiring employer consent to units combining jointly employed and solely employed employees of a single user employer, was not only a permissible interpretation of the statute, but also better served the purposes of the Act. The Board determined that a unit combining employees solely employed by a user employer and employees jointly employed by that same user employer and a supplier employer logically falls within the ambit of a 9(b) employer unit. All the employees in such a unit are performing work for the user employer and are employed within the meaning of the common law by the user employer. Thus, the user employer and the supplier employer are joint employers of the employees referred by the supplier to the user for its use. In sum, a Sturgis unit comprises employees who, working side by side, are part of a common enterprise. Dissent. Member Miscimarra dissented from the majority’s approval of multi-employer/non-employer bargaining in the circumstances presented here. First, he noted that the majority in Browning-Ferris Industries, Inc., created a new type of multi-employer bargaining in joint-employer situations that will result in confusion and instability. Further, he argued that the Act’s requirements and sound policy considerations prevents the Board from certifying multi-employer bargaining units without the consent of the parties. Third, the dissent disagreed with the majority’s use of this case as a vehicle for overruling existing precedent. Miscimarra urged that the Board should have decided the employer supplier’s motion to dismiss before proceeding with the resolution of the merits. He argued that by overruling Oakwood, the Board was essentially issuing an advisory opinion. Moreover, he noted that the Board has no shortage of cases involving actual employees whose interests will be affected by the Board’s resolution of their dispute.

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