Seyfarth Synopsis: Overturning decade old precedent, the Board found that temporary workers supplied by a staffing agency may be included in a bargaining unit with regular employees of a host employer without the consent of both employers. The Board will apply “traditional community of interest” factors in determining whether such a unit is appropriate.

On Monday, in a 3-1 decision, Miller & Anderson, Inc. et. al., 364 NLRB No. 39 (July 11, 2016), (Decision) the NLRB overturned its prior precedent and continued its efforts to expand the joint-employer platform by making it substantially easier for temporary workers to be included in bargaining units with employees of the user employer.

For over a decade, the Board followed its holding in Oakwood Care Center, 343 NLRB 659 (2004), requiring staffing agencies and user employers to both provide consent before a union could organize a bargaining unit which included regular employees of the host employer and temporary employees supplied by the staffing agency. The Oakwood Board opined that Congress had not given the Board authority to direct elections in bargaining units comprised of employees of more than one employer, and that the complexity of a combined unit gave rise to significant conflicts between the multiple employers and group of employees.

In specifically overturning Oakwood, the Board emphasized that “[r]equiring employees to obtain employer permission to organize in such a unit is surely not what Congress envisioned,” as the consent mandate “upend[s] the Section 9(b) mandate and allow[s] employers to shape their ideal bargaining unit, which is precisely the opposite of what Congress intended.” To that end, the Board concluded that employer consent is no longer necessary for bargaining units that combine jointly employed and solely employed employees. Instead, the Board will apply the “traditional community of interest factors” in deciding whether a given unit is appropriate.

In doing so, the Board claims to have returned to its holding in M.B. Sturgis, 331 NLRB 1298 (2000), which it overturned in Oakwood 4 years later. M.B. Sturgis itself overturned 40 years of Board precedent. However, the Board’s decision in Miller & Anderson has far wider reaching implications than that of Sturgis, given the significant changes to the joint-employer landscape established in Browning-Ferris Industries of California, Inc., 362 NLRB No. 186 (2015).

In his dissent, Member Miscimarra raised concerns about how the new standard will be applied in light of the broad joint-employer standard set forth in the Browning-Ferris: “As a result of today’s decision, our statute is being stretched further to combine (i) all the challenges associated with joint-employer bargaining under the expansive Browning-Ferris standard, plus (ii) additional issues caused by mandating bargaining where one or more business entities do not have any employment relationship with some employees in the bargaining unit. Indeed, if the unit consists mostly of employees who are solely employed by one joint employer (the user employer), the majority of unit employees will have no employment relationship with the other employer (the supplier employer).”

Like many employers, Member Miscimarra is justifiably concerned that non-employer businesses, like staffing agencies, will be forced to bargain with members of the combined unit even if they do not have the slightest authority or potential authority to “indirectly” affect employment terms and conditions. The Board majority, however, seems to have no fear of injecting itself into complex business relationships, spanning different interests and industries with no regard for competing or conflicting employee or employer interests, all in the interests of giving unions a leg up.

Miller & Anderson, combined with the Browning-Ferris decision from 2015 and the Quickie Election rules, form a trilogy with broad implications for employers who now face the possibility of increased unionization of their workforces and those of their staffing agencies in double quick time. Accordingly, employers should select their staffing agencies wisely, mindful of the possibility of having to bargain with temporary employees with whom they have little or no business relationship in conjunction with a staffing agency that may have conflicting interests.