Executive Summary: In a July 11, 2016, decision that will make it easier for unions to organize temporary employees, the National Labor Relations Board (NLRB) overruled existing precedent and held a union may represent a bargaining unit consisting of both regular employees and temporary employees supplied by another employer even if the employers do not consent. See Miller & Anderson, Inc., 364 NLRB No. 39 (2016). Previously, the NLRB would not permit an election in a bargaining unit that combined employees from more than one employer unless all employers agreed. This decision increases the likelihood that employers who use temporary employees will become enmeshed in labor relations disputes involving those temporary employees.
The NLRB's Traditional Rule for Multi-Employer Bargaining Units
The NLRB's traditional rule has been that under the National Labor Relations Act it could not approve an election in a bargaining unit that combined employees from multiple employers unless all the employers consented. This multi-employer situation frequently arises where an employer (which the NLRB refers to as the user employer) supplements its workforce of regular employees with temporary employees supplied by another employer (which the NLRB refers to as the supplier employer).
The NLRB departed from its traditional rule in M.B. Sturgis, Inc., 331 NLRB 1298 (2000). In that case, the NLRB held employer consent was not required for a bargaining unit consisting of the user employer's regular employees and temporary employees who are jointly employed by both the user employer and the supplier employer. The M.B. Sturgis decision was short lived. In Oakwood Care Center, 343 NLRB 659 (2004), the Board overruled M.B. Sturgis and returned to its traditional rule holding that regular employees and temporary employees cannot be combined into one bargaining unit unless both the user employer and the supplier employer agreed.
The Board Overrules Its Traditional Rule
In Miller & Anderson, the Board concluded its traditional rule was not consistent with the growing trend to use temporary employees in a variety of industries and that the rule limited those employees' opportunity for workplace representation. Accordingly, the Board held employer consent will no longer be required for a bargaining unit that combines the user employer's regular employees and temporary employees jointly employed by the user employer and the supplier employer. The Board now will approve such a unit if the regular employees and the temporary employees share a community of interest.
The Impact on Employers
If a union wins an election in a bargaining unit consisting of both regular employees and temporary employees, the user employer and the supplier employer both would have an obligation to bargain with the union with respect to the terms and conditions of the jointly employed temporary employees. According to the Board, each employer would have an obligation to bargain "only with respect to such terms and conditions that it possesses the authority to control." Importantly, an employer's bargaining obligation is not limited to terms and conditions over which it has actually exercised control. Instead, it extends to those topics over which it possesses the authority to control even if that authority has never been exercised.
The NLRB's decision leaves a number of questions unanswered. For example, how do the user employer and the supplier employer decide which of them is obligated to bargain over which topics? Similarly, how are disputes resolved when the user employer and the supplier employer do not agree during bargaining? Bargaining also will be complicated by the fact that the user employer will simultaneously be bargaining with the union in the same negotiations about its regular employees' terms and conditions of employment, which may be dramatically different from those of the temporary employees.
Employers' Bottom Line
The Board's Miller & Anderson decision will make it easier for unions to organize temporary employees. As a result, employers that use temporary employees face an increased risk of becoming involved in and being required to bargain over the terms and conditions of employment of the temporary employees.