Flip-flopping once again, the National Labor Relations Board (Board) has reversed its precedent and decided that jointly employed contingent employees, * supplied by one employer ("supplier employer") to another employer ("user employer"), may be included in a single unit for collective bargaining with the user employer's regular employees, without the consent of either the supplier or user employer. In its Decision and Order in M.B. Sturgis, Inc., 331 NLRB No. 173, the Board overruled its 1990 decision in Lee Hospital, 300 NLRB 947 (1990), that prohibited any unit that would combine jointly employed employees with employees solely employed by one of the joint employers, absent the consent of both employers.
In order for the contingent workers to be included in a unit with the user employer's employees, the contingent workers must be "jointly" employed by the supplier and user employers, and must share a sufficient community of interest with the user employer's regular employees. Supplier and user employers may be joint employers of the contingent workers if they share or co-determine matters governing the essential terms and conditions of employment such as hiring, firing, discipline, supervision and direction. Employees share a community of interest if they have similar interests in wages, hours, benefits, supervision and other working conditions.
In reaching its conclusion, the Board examined cases pre-dating Lee Hospital and found that no Board or court decision had barred units combining jointly employed employees and employees solely employed by one of the joint employers, and no decision had identified any statutory impediment to such units. Rather, the propriety of these types of units had been determined by examining the community of interests of the employees in the potential units.
The Board's conclusion hinged on the distinction between an "employer unit" in which all the contingent workers perform work for one user employer, and a "multi-employer unit" in which the contingent workers work for two or more user employers. Consent of the supplier employer is not required for employees to be represented for collective bargaining in a single user employer unit. In contrast, the consent of all employers is required before employees may be represented in a multi-employer unit for collective bargaining. According to the Sturgis decision, in the case of a proposed bargaining unit consisting of contingent and regular employees who work for a single (user) employer, the Board considers the proposed unit to be an employer unit, and no consent by the supplier and user employers is required. On the other hand if a proposed unit consists of contingent workers provided by a supplier employer and the regular employees of more than one user employer, the Board considers the proposed unit to be a multi-employer unit, and the consent of the supplier employer and each user employer is required before a union can bargain on behalf of the unit.
The Board's decision can have an immediate and direct impact on temporary employment agencies, leasing companies, and on companies that use contingent workers from such agencies along with their own employees. Under the Sturgis decision, a union may petition the Board to represent a bargaining unit consisting of both the regular employees of the user employer and the contingent workers assigned to the user employer. If the contingent workers are deemed to be joint employees of the supplier and the user employer, and the contingent workers share a sufficient community of interest with the user employer's employees, the supplier employer may have to bargain jointly with the user employer over the terms and conditions of employment of the contingent workers assigned to the user employer, if the union becomes the employees' bargaining agent.
The Board in using the term "contingent worker" referred to "temporary workers" and to "contract workers."
*article courtesy of Mark Goldner, Donald T. O'Connor, and Mark J. Neuberger of Buchanan Ingersoll & Rooney PC.