Oakwood Care Center

National Labor Relations Board - Board Decisions

Nov 19, 2004

343 N.L.R.B. 659 (N.L.R.B. 2004)

OAKWOOD CARE CENTER
343 NLRB No. 76
659
H.S. CARE L.L.C., d/b/a Oakwood Care Center and
N&W Agency, Inc. and New York’s Health and
Human Service Union, 1199, Service Employees
International Union, AFL–CIO, Petitioner.
Case 29–RC–10101
November 19, 2004
DECISION ON REVIEW AND ORDER
BY CHAIRMAN BATTISTA AND MEMBERS LIEBMAN,
SCHAUMBER, WALSH, AND MEISBURG
On October 20, 2003, the Regional Director for Re-
gion 29 issued a Decision and Direction of Election, in
which he found appropriate a petitioned-for unit of non-
professional employees at Oakwood’s facility in Oak-
dale, New York. The petitioned-for unit includes both
employees who are solely employed by Oakwood and
employees who are jointly employed by Oakwood and a
personnel staffing agency, N&W.
On February 11, 2004, we granted Oakwood’s request
for review of the Regional Director’s decision. Oak-
wood argued, among other things, that the unit combin-
ing the two groups of employees is inappropriate under
the Act.1 Oakwood urged the Board to overrule its deci-
sion in M. B. Sturgis,2 on which the Regional Director
relied. In Sturgis, the Board found that bargaining units
that combine employees who are solely employed by a
user employer and employees who are jointly employed
by the user employer and a supplier employer are per-
missible under the Act.
For the reasons discussed below, we hold, contrary to
the Board’s decision in Sturgis, that such units constitute
multiemployer units, which, in accordance with the stat-
ute, may be appropriate only with the consent of the par-
ties. Therefore, we overrule the Board’s decision in
Sturgis and return to the Board’s longstanding prior
precedent.
Facts3
Oakwood has operated the Oakdale long-term residen-
tial care facility (the Home) since August 2002. At the
time of the hearing in this proceeding, Oakwood had
filled 152 beds of the Home’s 280-bed capacity and had
hired approximately 55 percent of its expected number of
employees, including at least some employees in each
relevant classification. There is no dispute that some of

1 The Employer also requested review of the Regional Director’s de-
termination that a substantial and representative complement of unit
employees existed, so that an election could be conducted. We find it
unnecessary to pass on that issue, however, based on our decision re-
garding the appropriateness of the unit.
2 331 NLRB 1298 (2000).
3 The parties stipulated to the facts in this proceeding, and no wit-
nesses testified at the hearing.
the employees are solely employed by Oakwood, and
other employees, i.e., those supplied by N&W, are
jointly employed by Oakwood and N&W.
The jointly employed employees as well as those
solely employed by Oakwood perform duties that are
part of the normal functioning of the Home. Oakwood
and N&W together determine the pay and benefits of the
jointly employed employees. Oakwood supervisors su-
pervise and direct these employees, determine their work
schedules, approve schedule changes, assign them over-
time work, and approve their requests for time off, both
paid and unpaid. In addition, Oakwood supervisors dis-
cipline these employees and evaluate their work per-
formance. The jointly employed employees wear identi-
fication tags issued by Oakwood and identifying them as
employees of the Home.
The parties stipulated that, if the Board applies its
holding in Sturgis to the facts of this case, the petitioned-
for unit would be an appropriate unit. However, Oak-
wood urges the Board to reverse Sturgis, contending that
it was wrongly decided.
Pre-Sturgis Board Precedent: Greenhoot and
Lee Hospital
For decades prior to Sturgis, the Board’s decisions in
Greenhoot, Inc.,4 and Lee Hospital5 provided the control-
ling precedent regarding a unit that would combine
groups of employees who had an employer in common
but did not have identical employers because one or
more groups had an additional, joint employer not shared
by the others. In such cases, the Board relied on the
principle that involuntary combinations of those employ-
ees (and their respective employers) constituted inappro-
priate bargaining units.
In Greenhoot, the Regional Director directed an elec-
tion in a petitioned-for unit of engineers and maintenance
employees working at 14 office buildings. Each building
was owned by a separate employer, and all of the build-
ings were managed by Greenhoot. The employees in
each building were jointly employed by their building
owner and by Greenhoot. Thus, in buildings owned re-
spectively by A, B, and C, the employees were employed
by Greenhoot and A, Greenhoot and B, and Greenhoot
and C. The unit sought combined all 14 groups of these
employees into a single unit. Greenhoot argued, inter
alia, that such a unit was inappropriate.
Agreeing with Greenhoot’s argument, the Board found
14 separate joint employer relationships consisting of
Greenhoot and the building owner and treated the peti-

4 205 NLRB 250 (1973).
5 300 NLRB 947 (1990).
DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD660
tioned-for unit as a multiemployer unit requiring consent.
The Board held that:
[T]here is no legal basis for establishing a multiem-
ployer unit absent a showing that the several employers
have expressly conferred on a joint bargaining agent
the power to bind them in negotiations or that they have
by an established course of conduct unequivocally
manifested a desire to be bound in future collective
bargaining by group rather than individual action.6
Finding no evidence of such consent by the various em-
ployers, the Board determined that 14 separate units were
appropriate. The Board remanded the proceeding to the
Regional Director for the purpose of conducting elections in
each of the 14 units.
In Lee Hospital, the Petitioner sought a unit of all cer-
tified registered nurse anesthetists (CRNAs). The
CRNAs were employed in the anesthesia department,
which was operated by Anesthesiology Associates, Inc.
(AAI), under a contract with the hospital. The Regional
Director found that the CRNAs did not have the disparity
of interests required to justify a unit separate from the
professional employees employed solely by the hospital.
The Regional Director found it unnecessary to determine
whether the hospital and AAI were joint employers of
the CRNAs. The Board found that the initial inquiry was
not whether there was a disparity of interests between the
CRNAs but rather whether the CRNAs could legally be
in the same unit as the other professionals. This issue, in
turn, depended on whether Lee and AAI were joint em-
ployers of the CRNAs. The Board explained:
As a general rule, the Board does not include employ-
ees in the same unit if they do not have the same em-
ployer, absent employer consent. Thus, if AAI is a
joint employer, the CRNAs could be included in the
unit with other professionals employed by Lee Hospital
only with the hospital’s consent.7
Thus, consistent with Greenhoot, the Board in Lee Hospital
found that sharing one employer was insufficient to permit
including jointly employed CRNAs in the existing unit of
solely employed professional employees without employer
consent. Ultimately, however, the Board found that AAI
was not a joint employer of the CRNAs and affirmed the
Regional Director’s dismissal of the petition on the basis of
insufficient disparity of interests.

6 Greenhoot, supra at 251.
7 Lee Hospital, supra at 948, citing Greenhoot, supra at 251 (footnote
omitted).
M. B. Sturgis
In Sturgis, the Board overturned these settled princi-
ples. Applying a novel definition of “employer” fash-
ioned for the purpose of deciding the case, the Sturgis
majority, for the first time in the history of the Act, stated
that some units combining jointly employed and solely
employed employees were nevertheless single employer
units. We have carefully considered the arguments ad-
vanced by the Sturgis Board and respectfully disagree.
We have concluded that Sturgis was wrongly decided
and overrule it today.
In Sturgis, the Board reviewed two decisions by Re-
gional Directors. One decision found appropriate a peti-
tioned-for unit that included Sturgis’ approximately 35
solely employed employees but excluded 10–15 employ-
ees supplied to Sturgis by Interim, a temporary help
agency. The employer requested review of the Regional
Director’s decision, arguing that the unit was not appro-
priate unless the supplied employees were included. In
the other case, the petitioner sought to clarify an existing
unit of approximately 600 production and maintenance
employees solely employed by Jeffboat Division, Ameri-
can Commercial Marine Service Company (Jeffboat), to
accrete 30 steamfitters and welders supplied to Jeffboat
by supplier TT&O. The Regional Director dismissed the
petition in Jeffboat, finding that the combined unit would
be inappropriate without the employers’ consent.8
In each case, the Board found that the supplied em-
ployees were jointly employed by the user (i.e., Sturgis
or Jeffboat) and its supplier. Moreover, the Board held
that units including these jointly employed employees
and the solely employed employees of the user were
permissible under Section 9(b) without the consent of the
employers. The Board reasoned:
That a unit of all of the user’s employees, both those
solely employed by the user and those jointly employed
by the user and the supplier, is an “employer unit”
within the meaning of Section 9(b) is logical and con-
sistent with precedent. The scope of a bargaining unit
is delineated by the work being performed for a par-
ticular employer. In a unit combining the user em-
ployer’s solely employed employees with those jointly
employed by it and a supplier employer, all of the work
is being performed for the user employer. Further, all
of the employees in the unit are employed, either solely
or jointly, by the user employer. Thus, it follows that a
unit of employees performing work for one user em-
ployer is an “employer unit” for purposes of Section
9(b).

8 The petition concerning the Sturgis unit named only Sturgis as the
employer; the Jeffboat petition named both Jeffboat and TT&O.
OAKWOOD CARE CENTER 661
331 NLRB at 1304–1305. The Board therefore overruled
Lee Hospital and held that employees jointly employed by
employers A and B could be in a unit with employees solely
employed by one of them. The issue of whether they are in
fact to be in one unit would turn on a “community of inter-
est” analysis.
The Sturgis Board also reaffirmed, however, the con-
tinuing validity of the Board’s holding in Greenhoot that
a unit comprised of employees jointly employed by a
single supplier employer and multiple user employers
was a multiemployer unit impermissible absent consent
of all parties. The Board stated:
[C]ases like Greenhoot involve multiple user employ-
ers whose only relationship to each other is that they
obtain employees from a common supplier employer.
In such cases, the union seeks to represent a unit that
includes employees of all of the users. Thus, it is clear
that the unit is a multiemployer unit and therefore con-
sent of the separate user employers would be required
before the Board could direct an election.9
In dicta, the Sturgis Board “clarified” Greenhoot by stating
that if the union in Greenhoot had sought to bargain with
and named only Greenhoot (the supplier employer) in its
election petition, the unit, if certified, would not be a mul-
tiemployer unit.10
Thus, the Sturgis Board found that the proposed com-
bined units were permissible under Section 9(b). It re-
manded both proceedings to the respective Regional Di-
rectors for a determination whether the petitioned-for
unit at Sturgis and the accretion at Jeffboat were appro-
priate under applicable community of interest stan-
dards.11
Post-Sturgis Cases
The Sturgis Board’s reinterpretation of the concept of
an “employer unit” severed that term from its statutory
moorings. This loss of direction gave rise to anomalous
decisions such as Gourmet Award Foods, 336 NLRB 872
(2001). There, the employer expanded its use of tempo-
rary employees in response to increased business, and
notified the union representing its drivers and ware-
housemen that some temporary employees would work
at the facility for 4 to 5 months. The union demanded
that the employer apply the collective-bargaining agree-
ment to these temporary employees, and the Board

9 Sturgis, supra at 1305.
10 Id. at 1308.
11 Dissenting, Member Brame found that Sec. 9(b) does not author-
ize the Board to certify bargaining units that encompass both the solely
employed employees of an employer and employees jointly employed
by that and another employer.
agreed. Finding them to be jointly employed by the em-
ployer and the temporary agencies that supplied them,
the Gourmet Award Foods Board concluded that the
temporary employees were automatically added to a unit
of solely employed employees, without any vote by ei-
ther group, because, under Sturgis, they were “new em-
ployees” “hired” into a unit classification. Thus, Sturgis
gave rise not only to a new definition of “employer,” but,
as extended in Gourmet Award Foods, also a new con-
ception of “new employees” and “hire” as well.
The Gourmet Award Foods Board acknowledged that
the employer had no reason to expect that the temporary
employees supplied by other employers would be in-
cluded in the existing bargaining unit. Faulting the em-
ployer for failing to foresee the unforeseeable, however,
the Board proceeded to find that those temporary em-
ployees were included in the unit because the unit defini-
tion did not expressly exclude them.
Further extending the strained logic of Sturgis, the
Gourmet Award Foods Board held that the employer was
required to apply its collective-bargaining agreement to
the temporary employees only with respect to those
terms that it controlled. By requiring the employer to
apply some but not all of the terms of its collective-
bargaining agreement to these “employees,” the Board
effectively modified the parties’ agreement as well.
Reconsideration of Sturgis
Section 9(b) of the Act establishes the Board’s author-
ity to determine appropriate units, providing in relevant
part:
The Board shall decide in each case whether, in order
to assure to employees the fullest freedom in exercising
the rights guaranteed by this Act, the unit appropriate
for the purposes of collective bargaining shall be the
employer unit, craft unit, plant unit, or subdivision
thereof. [Emphasis added.]
Of these permissible categories of units, the broadest is
the “employer unit,” with each of the other delineated
types of appropriate units representing subgroups of the
work force of an employer. Thus, the text of the Act re-
flects that Congress has not authorized the Board to di-
rect elections in units encompassing the employees of
more than one employer. The legislative history sup-
ports this interpretation of the plain language of the Act.
Specifically, Congress included the phrase “or subdivi-
sion thereof” to authorize other units “not as broad as
‘employer unit,’ yet not necessarily coincident with the
phrases ‘craft unit’ or ‘plant unit.’”12

12 H.R. Statement on Conf. Rep. S. 1958, 79 Cong. Rec. 10297,
10299 (1935), reprinted in 1 Leg. Hist. 3260, 3263 (NLRA 1935).
DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD662
Where the parties voluntarily agree to multiemployer
bargaining, however, the Board has long recognized the
legitimacy of such units.13 In cases where all parties
voluntarily agree to bargain on a multiemployer basis,
the Supreme Court has recognized that “Congress in-
tended that the Board should continue its established
administrative practice of certifying multiemployer
units.”14
By ignoring the bright line between employer and mul-
tiemployer units, Sturgis departed from the statutory di-
rective of Section 9(b) as well as decades of Board
precedent. We find that the new approach adopted in
Sturgis, however well intentioned, was misguided both
as a matter of statutory interpretation and sound national
labor policy.
Sturgis left in place the fundamental principle that Sec-
tion 9(b) permits the Board to find multiemployer units
appropriate only with the consent of the parties but re-
stricted the situations in which that principle would be
applied through a strained interpretation of the phrase
“employer unit.” The Sturgis majority held that a unit
composed of the employees of a user employer and em-
ployees jointly employed by the user and a supplier em-
ployer consists of employees of one employer. We dis-
agree with this redefinition of terms, as it is inconsistent
with the plain meaning of “employer unit” in the Act.
Returning to prior precedent under both Greenhoot and
Lee Hospital, we conclude that solely employed employ-
ees and jointly employed employees are employees of
different employers and that their inclusion in the same
bargaining unit creates a multiemployer unit.
A joint employer, under the Board’s traditional defini-
tion, is comprised of two or more employers (e.g., A and
B) that “share or codetermine those matters governing
essential terms and conditions of employment” for bar-
gaining unit employees.15 All of the unit employees
work for a single employer, i.e., the joint employer entity
A/B. Therefore, a joint employer unit of A/B is not a
multiemployer unit. In a Sturgis unit, in contrast, some
of the employees are employed by A, and others are em-
ployed by A/B. It may be that, as to the latter group, A
and B jointly set all terms and conditions of employment.
Or, it may be that, as to that group, A sets some terms
and B sets others. The critical point is that the one group
has its terms set by A/B. The other group has its terms

13 See, e.g., Shipowners Assn. of the Pacific Coast, 7 NLRB 1002,
1024–1025 (1938), review denied sub nom. AFL v. NLRB, 103 F.2d
933, affd. 308 U.S. 401 (1940). See also H. Conf. Rep. No. 510 on H.R.
3020, reprinted in 2 Leg. Hist. 535–536 (LMRA 1947).
14 NLRB v. Truck Drivers Local 449 (Buffalo Linen Supply Co.), 353
U.S. 87, 96 (1957).
15 NLRB v. Greyhound Corp., 368 F.2d 778, 780 (5th Cir. 1966), on
remand from Boire v. Greyhound Corp., 376 U.S. 473 (1964).
set only by A. Thus, the entity that the two groups of
employees look to as their employer is not the same. No
amount of legal legerdemain can alter this fact.
In finding otherwise, the Sturgis Board relied on ear-
lier cases involving department stores, where the Board
found units combining employees solely employed by
the store with employees jointly employed by the store
and its licensees to be appropriate.16 However, these
cases are not precedent for the holding in Sturgis, be-
cause no party raised, and the Board and the reviewing
courts did not consider, the statutory restrictions imposed
by Section 9(b) on nonconsensual units that are multiem-
ployer in scope. Therefore, these cases do not answer the
statutory question presented in Sturgis and in this pro-
ceeding and provide no precedential support for the sea-
change in Board law wrought by Sturgis.17
In addition, the department store cases are distinguish-
able on their facts. A series of cases involving K-Mart
illustrates the typical pattern. In each, licensees operated
sales departments within K-Mart stores under license
agreements that vested K-Mart with wide-ranging control
over the licensees’ business operations and labor rela-
tions. K-Mart controlled advertising, merchandising,
credit decisions, and the physical arrangement of the
department.18 Under the licenses, “the public is given the
impression of a single, integrated enterprise since . . .
each licensee must ‘conduct sales on the premises solely
under the name of K-Mart.’”19 K-Mart also controlled the
licensees’ labor relations to such an extent that “it would
be impossible for a licensee to enter into a binding col-
lective bargaining agreement without [K-Mart’s] con-
sent.”20 In short, K-Mart and its licensees were not only
joint employers but a “joint enterprise”21—a unique rela-
tionship not present in Sturgis or this case.
The policy implications of Sturgis are as problematic
as its interpretation of Section 9(b). As Member Brame
pointed out in his Sturgis dissent, the bargaining struc-
ture contemplated in that decision gives rise to signifi-
cant conflicts among the various employers and groups
of employees participating in the process. These are pre-
cisely the types of conflicts that Section 9(b) and the

16 See, e.g., S.S. Kresge, 169 NLRB 442, enfd. in pertinent part 416
F.2d 1225 (6th Cir. 1969), and S.S. Kresge, 162 NLRB 498 (1966),
enfd. in pertinent part sub nom. Gallenkamp Stores v. NLRB, 402 F.2d
525 (9th Cir. 1968).
17 See also Stack & Co., 97 NLRB 1492 (1952) (finding that depart-
ment store was an employer of leased department employees without
addressing whether resulting unit was multiemployer in scope).
18 Gallenkamp, supra at 529.
19 NLRB v. S.S. Kresge, supra, 416 F.2d at 1227.
20 Id. at 1231.
21 Id.
OAKWOOD CARE CENTER 663
Board’s community-of-interest test are designed to
avoid.22
Although Sturgis anticipates that each employer will
bargain with respect to employees whom it employs and
as to the terms and conditions of employment that it con-
trols, the reality of collective bargaining defies such neat
classifications. Two examples illustrate this point. First,
the wages paid to the jointly employed employees, which
are frequently controlled by the supplier, could certainly
have an effect on the negotiation of the wages of the
solely employed employees, a matter controlled by the
user. Second, the user employer would likely determine
the holiday schedule for its facility, but the supplier
might control whether the jointly employed employees
are paid for those holidays. These are merely examples
of how the bifurcation of bargaining regarding employ-
ees in the same unit hampers the give-and-take process
of negotiation between a union and an employer, and
places the employers in the position of negotiating with
one another as well as with the union. The user em-
ployer’s status as the customer of the supplier may effec-
tively restrict the supplier’s options in bargaining as to
those subjects that appear to be within its purview.23 This
fragmentation thus undermines effective bargaining.
The bargaining regime posited in Sturgis also fails to
adequately protect employee rights. It combines jointly
employed and solely employed employees in a single
unit, with a single union negotiating with two different
employers, each of which controls only a portion of the
terms and conditions of employment for the unit. Such a
structure subjects employees to fragmented bargaining
and inherently conflicting interests, a result that is incon-
sistent with the Act’s animating principles.
For example, in many situations, the wages of the sup-
plied employees are set by the supplier (A), and the
wages of the solely employed employees are set by the
user (B). The result is that the wages of the employees
of A/B may be traded away, in bargaining, for the sake
of employees of B, or vice-versa. In order for employees
to enjoy the full prospect of effective representation, the
Act contemplates that employees be grouped together by
common interests and by a common employer. The non-
consensual mixing of employees of different employers
vitiates that basic principle.24

22 The difficulties that arise from the Sturgis holding are necessarily
magnified in situations involving multiple supplier employers.
23 As Member Brame correctly noted in Sturgis, additional problems
could arise in designating whether union activity is primary or secon-
dary under Sec. 8(b)(4)(ii)(B).
24 Concededly, in a multiemployer situation, employees of different
employers are grouped together in one unit and covered by one con-
tract. But this is because multiemployer bargaining can bring about
industrial stability for the benefit of all. See Retail Associates, 120
The Sturgis dicta authorizing, for the first time, peti-
tions in which the union names only one of the joint em-
ployers create additional bargaining difficulties for em-
ployees. This concept profoundly diminishes employee
Section 7 rights. Because the supplier employer gener-
ally controls the economic terms of its employees, a peti-
tion that names only the user employer potentially sad-
dles the jointly employed employees with a representa-
tive that will be unable to bargain with the employer that
controls their wages. Presumably, such a petition also
potentially precludes the employees from ever obtaining
union representation for that purpose (unless the Sturgis
Board intended also to sanction multiple “exclusive”
representatives for the same employees).
Conclusion
For these reasons, we conclude that permitting a com-
bined unit of solely and jointly employed employees, as
the Board did in Sturgis, contravenes Section 9(b) by
requiring different employers to bargain together regard-
ing employees in the same unit. We hold that combined
units of solely and jointly employed employees are mul-
tiemployer units and are statutorily permissible only with
the parties’ consent.25
In the present proceeding, the Petitioner seeks to repre-
sent a unit encompassing both the solely employed em-
ployees of Oakwood and the jointly employed employees
supplied to Oakwood by N&W. We find that the peti-
tioned-for unit is a multiemployer unit. Because neither
Oakwood nor N&W has consented to bargaining with the
other in a multiemployer unit, the petition must be dis-
missed.
ORDER
The Regional Director’s Decision and Direction of
Election is reversed, and the petition is dismissed.
MEMBERS LIEBMAN AND WALSH, dissenting.
The Board now effectively bars yet another group of
employees—the sizeable number of workers in alterna-
tive work arrangements—from organizing labor unions,
by making them get their employers’ permission first.1

NLRB 388 (1958). Multiemployer bargaining requires the consent of
all, an element missing here.
25 As noted above, the required consent, consistent with well-
established precedent concerning multiemployer bargaining, must be
clear and unequivocal, as manifested by express agreement or by actu-
ally entering into bargaining on a multiemployer basis. Employer
consent will not be inferred from the joint employer relationship.
Greenhoot, supra, 205 NLRB at 251.
1 These workers thus join university graduate student employees and
disabled workers in rehabilitative employment in what amounts to a
legal underclass. See Brown University, 342 NLRB 483 (2004) (gradu-
ate teaching assistants); Brevard Achievement Center, 342 NLRB 982
(2004) (disabled workers).
DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD664
That result is surely not what Congress envisioned when
it instructed the Board, in deciding whether a particular
bargaining unit is appropriate, “to assure to employees
the fullest freedom in exercising the rights guaranteed by
th[e] Act.” 29 U.S.C. §159(b).
Section 9(b) of the Act authorizes the Board to choose
among “the employer unit, craft unit, plant unit, or sub-
division thereof.” Id. Overruling M. B. Sturgis, Inc., 331
NLRB 1298 (2000), the majority insists that the statutory
phrase “employer unit” plainly prohibits a bargaining
unit that covers, in the same workplace, both a supplier
employer’s employees and the user employer’s employ-
ees—despite the fact that, under the Board’s law, the two
employers are joint employers of the supplied workers,
and the supplied workers and their coworkers share a
community of interest.
The alternative work arrangements involved here de-
part from the so-called “traditional relationship” charac-
terized by a social contract between employers and em-
ployees. These new arrangements have been caused “in
large measure by pressures on employers to restructure
themselves, pressures that are massive and appear
unlikely to go away.” Peter Capelli, et al., Change at
Work (1997).2 Capelli concludes that “[s]ome companies
appear to be making increased use of contingent labor as
part of their strategic decision to pursue a low-wage,
low-skill, high-turnover path to profit making.” Id. at 77.
As one recent examination of the working poor observed:
[G]lobalization has thrown the least-skilled into head-
on competition with people willing to work for pennies
on the dollar. And a torrent of immigration, mainly
poor rural Mexicans, has further swelled the low-end
labor pool. Together, these trends have shoved many
hourly wage occupations into a world-wide, discount
labor store stocked with cheap temps, hungry part-
timers, and dollar-a-day labor in India, Mexico, and
China, all willing to sell their services to the lowest

2 As Capelli has explained elsewhere:
[T]he common thread in these developments is that they represent a
weakening of the traditional bureaucratic employment relationship,
with its long-term commitments and internal labor market practices,
that buffered employment from outside markets. In its place, more
immediate market forces increasingly govern the internal operations
of firms and, in turn, the employment relationship. The phrase “mar-
ket-mediated employment relationships” might describe the new prac-
tices that are based around more short-term, contractual relationships
shaped by pressures from the outside labor market and individualized
incentives.
Capelli, “Market-Mediated Employment: The Historical Context” in
The New Relationship: Human Capital in the American Corporation,
Blair and Kochan, eds., 66–69 (2000). See also Lynn Karoly & Con-
stantijn Panis, The 21st Century at Work 116–119, 192–194 (2004)
(discussing “nonstandard work arrangements”).
bidder. Against such headwinds, full employment of-
fers only partial protection.
Michelle Conlin & Aaron Bernstein, “Working . . . and
Poor,” Business Week, May 31, 2004 (Issue 3885), at 62.
It is a mistake to approach this case—involving the
rights of temps, part-timers, and other contingent work-
ers to improve their working conditions through union
representation—without this frame of reference. And
however real the competitive pressures on American
firms, their need to respond to economic uncertainty
should not be permitted to erode their employees’ rights
to union representation. Today’s decision does just that,
rather than ensure that the Board’s law keeps pace with
changing conditions, as Congress envisioned. Insisting
on a supposed strict construction, the majority wrongly
concludes that the statute itself does not permit the ap-
proach taken by the Board in Sturgis. As for the policy
reasons the majority offers, no empirical support is cited.
Remarkably, the Board did not even solicit the public’s
views on the practical effects of Sturgis. The majority
never explains how granting employers veto power over
union representation advances the “fullest freedom” of
employees to pursue collective bargaining. Protecting
employers who choose to create alternative work ar-
rangements—and who now are essentially encouraged to
do so, to frustrate union organizing—is not the Act’s
overriding concern.
Below, we summarize the Sturgis decision, describe
the majority’s decision here, and then explain why Stur-
gis was correctly decided and why today’s decision is
misguided. As will become clear, the majority’s claim
that its decision represents a “return to the Board’s long-
standing prior precedent” is simply wrong.
I. THE STURGIS HOLDING
For reasons it carefully explained, the Sturgis Board
overruled Lee Hospital, 300 NLRB 947 (1990)—a 10-
year-old decision, missing any rationale, which itself
broke with precedent. Lee Hospital barred units that,
without the employers’ consent, combine jointly and
solely employed employees, even where all the employ-
ees at issue perform similar work for the user employer
at a common worksite.3 331 NLRB at 1304–1308.
The key finding in Sturgis was that joint employers are
fundamentally distinct from groups of independent em-

3 Lee Hospital had improperly extended the holding of Greenhoot,
Inc., 205 NLRB 250 (1973), in which the Board found that where a
supplier provided maintenance employees to multiple building owners
at different locations, resulting in separate joint-employer relationships
between the supplier and each owner, a single bargaining unit combin-
ing all the owners’ employees with all the supplied employees was
impermissible without the owners’ consent. 205 NLRB at 251. Sturgis
reaffirmed Greenhoot in this respect. 331 NLRB at 1303–1305.
OAKWOOD CARE CENTER 665
ployers who bargain in the traditional multiemployer
setting. In the Sturgis Board’s words:
We decline to accept the faulty logic of Lee Hospital
. . . that a user employer and a supplier employer—
both of which employ employees who perform work
on behalf of the user employer—are equivalent to the
completely independent employers in multiemployer
bargaining units. No pre-Lee Hospital Board con-
ceived of such units as multiemployer units, and neither
do we.
331 NLRB at 1305.
Significantly, Sturgis did not mandate any form of
bargaining unit in a joint-employer situation. It merely
authorized bargaining units combining jointly with solely
employed employees, where such units would best en-
able all of the employees concerned to bargain with their
employers, based on their community of interest. As
Sturgis discussed, it had become critical that this form of
unit be available, because more and more employees
were working in alternative work arrangements. Id. at
1298. It remained for employees to decide whether to
seek such a unit—and for the Board to find that the unit
was appropriate, applying traditional tests.4
Finally, to provide an additional way for employees to
achieve union representation, Sturgis limited Greenhoot,
supra, so as to permit supplied employees to seek to bar-
gain only with the supplier employer, to the extent that
that employer controlled their terms and conditions of
employment. 331 NLRB at 1308.
II. THE PROPER RESOLUTION OF THIS CASE
There is no dispute that the Employers here constitute
a joint employer. There is also no dispute that the em-
ployees whom N&W Agency supplies to Oakwood are
jointly employed by N&W and Oakwood; that they per-
form the same functions as Oakwood’s own employees;
that both groups are intermixed virtually without distinc-
tion; or that both groups have common supervision and
wear the same identification tags. In fact, the parties
have quite properly stipulated that a joint bargaining unit

4 The majority mischaracterizes Gourmet Award Foods, 336 NLRB
872 (2001), a decision involving the statutory duty to bargain in good
faith, as demonstrating that Sturgis results in “anomalous decisions.” In
fact, Gourmet Award Foods involved the traditional principle “that
when an established bargaining unit expressly encompasses employees
in a specific classification, new employees hired into that classification
are included in the unit.” Id. at 873. The newly hired, jointly-
employed employees there fell within the job classifications covered by
an existing collective-bargaining agreement. Including them in the unit
was necessary to preserve the union’s bargain with the employer.
Sturgis, in turn, established that combining jointly-employed and
solely-employed employees in the same unit was not inappropriate. Id.
at 874.
would be appropriate here unless Sturgis is overruled.
Accordingly, for all the reasons explained above, the
Regional Director was correct in approving a joint unit
per Sturgis.
III. THE MAJORITY’S POSITION
The new majority’s position is simple and stark: Stur-
gis “departed from the statutory directive of Section
9(b)” by “[a]pplying a novel definition of ‘employer’
fashioned for the purpose of deciding the case” and “ig-
noring the bright line between employer and multiem-
ployer units.”5 According to the majority, permitting
joint employees to be combined in a unit with sole em-
ployees, without the consent of their employer, is “incon-
sistent with the plain meaning of ‘employer unit’ in the
Act.” Because two or more employers are involved, the
Act prohibits any bargaining unit that involves both of
them, unless they each consent.
The majority, then, insists that there is no difference
between (1) two employers who enter into an arrange-
ment with each other and who share control over certain
employees at the same worksite; and (2) competing em-
ployers who have no arrangement with each other and
who employ their own workers separately, at different
worksites. In each case, in the majority’s view, the Act
demands the consent of all the employers before bargain-
ing with them can occur.
In addition to concluding that the Act precludes a
Sturgis bargaining unit, the majority finds Sturgis defi-
cient as a matter of “sound national labor policy.” Citing
former Member Brame’s dissent, the majority asserts that
the common bargaining unit authorized in Sturgis “gives
rise to significant conflicts among the various employers
and groups of employees participating in the process.”
The majority cites no evidence at all—from either before
or after Sturgis—for this assertion.
Finally, the new majority seems to reject the alterna-
tive form of bargaining unit authorized by Sturgis: a unit
of all of a supplier employer’s employees to bargain only
with the supplier employer—the classic case, it appears
to us, of an “employer-wide unit.”
IV. ANALYSIS
The majority is mistaken in every critical respect. Sec-
tion 9(b) of the Act does not, by its terms, rule out a
Sturgis unit. Such a unit is permitted by the statute, and,
in fact, is necessary to enable the growing number of

5 Sec. 9(b) of the Act provides, in pertinent part:
The Board shall decide in each case whether, in order to assure to em-
ployees the fullest freedom in exercising the rights guaranteed by this
Act, the unit appropriate for the purposes of collective bargaining shall
be the employer unit, craft unit, plant unit, or subdivision thereof.
29 U.S.C. 159(b) (emphasis added).
DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD666
employees in alternative work arrangements to benefit
from collective bargaining, if they so choose. None of
the practical or policy objections raised by the majority
stand up to scrutiny. Its approach, moreover, will hasten
obsolescence of this statute.
A. Sturgis is Consistent with Section 9(b)
Section 9(b) of the Act authorizes the Board to desig-
nate an appropriate bargaining unit consisting of “the
employer unit, craft unit, plant unit, or subdivision
thereof.” The majority asserts that “the text of the Act
reflects that Congress has not authorized the Board to
direct elections in units encompassing the employees of
more than one employer.” But this view misreads the
Act. The provision defines the scope of the bargaining
unit, not the source of its members.
The language of Section 9(b) does not foreclose a unit
comprising more than one “employer,” much less multi-
ple employers who constitute a joint employer, a concept
that has no specific basis in the Act’s language, but is
well-established. E.g., Boire v. Greyhound Corp., 376
U.S. 473 (1964) (rejecting direct review of Board’s di-
rection of election in joint-employer unit). It is, of
course, undisputed that all the employees of one “em-
ployer” can constitute an appropriate bargaining unit.
And the majority itself acknowledges that a “joint em-
ployer, under the Board’s traditional definition, is com-
prised of two or more employers, [and] all of the unit
employees work for a single employer, i.e., the joint em-
ployer entity.” The majority concedes that a joint-
employer unit consisting solely of the joint employees is
appropriate, even absent the employers’ consent. Why
the Act’s language permits such a unit, but forecloses a
Sturgis unit, is unexplained.
The majority observes that a “craft unit, plant unit, or
subdivision” of an employer unit are each, by definition,
a sub-unit of an “employer unit.” But this fact tells us
nothing about the outer scope of an “employer” or an
“employer unit.”6 Similarly, a “plant unit” presumably
can include all employees at a particular worksite, at
least if they have an employer in common.
Contrary to the majority’s suggestion that Congress in-
tended to restrict the Board’s authority, the Supreme
Court has made clear that the “Board is accorded broad
discretion” in making unit determinations. Chemical
Workers v. Pittsburgh Plate Glass, 404 U.S. 157, 171

6 Correspondingly, the first sentence of Sec. 9(a)—the sentence in
the Act that establishes the right of employees to have an exclusive
bargaining representative—does not even refer to an “employer.” The
sentence authorizes “a unit appropriate for [collective bargaining] pur-
poses.” Neither Sec. 9(a) nor any other part of the Act even suggests
that an appropriate unit cannot include the joint and sole employees of a
joint employer.
(1971).7 The aim, as the language of Section 9(b) does
make clear, is “to assure employees the fullest freedom
in exercising the rights guaranteed by th[e] Act.”
The legislative history cited by the majority does not
support its position. Rather, it establishes only that Con-
gress, in Section 9(b), intended to authorize the Board to
find multiemployer units and employer sub-units appro-
priate. The only concern expressed by either the Wagner
Act Congress or the Taft-Hartley Congress with respect
to bargaining units that included more than one employer
was focused on industrywide or anti-competitive bar-
gaining units and on multiple-worksite situations.8 There
was no expression of disapproval with respect to joint-
employer units.
The majority’s restrictive application of Section 9(b) is
based entirely on the premise that a joint-employer situa-
tion is no different than a multiemployer, multi-worksite
situation. That premise is false. The critical difference,
noted in Sturgis, is that where one or more supplier em-
ployers provides employees to a single user employer at
a common worksite, all of the employees at the site work
for the user employer. 331 NLRB at 1304–1305. Hence
the unit scope is employerwide. Surely employees who
are working side by side, for employers who have volun-
tarily created that arrangement, should be able to join
together in the same bargaining unit, if they choose to.
They are part of a common enterprise and, absent a
common union representative, they are potential com-
petitors with each other with respect to the terms and
conditions of their work. Accordingly, where the Board’s
other criteria for determining community of interest are
met, it is appropriate for the joint employees to be com-
bined with the user employer’s sole employees in a joint
bargaining unit.9

7 “[The Taft-Hartley] Congress . . . intended to leave to the Board’s
specialized judgment the inevitable questions concerning multiem-
ployer bargaining bound to arise in the future.” NLRB v. Truck Drivers
Local 449 (Buffalo Linen), 353 U.S. 87, 96 (1957). (Emphasis added.)
“While the exact limits of the Board’s powers or the precise meaning of
the terms have not been fully defined, judicially, we know that they lie
within the area covered by the words ‘employer,’ ‘plant,’ and ‘craft.’
[footnote omitted.]. . . . As a standard, the Board must comply, also,
with the requirement that the unit selected must be one to effectuate the
policy of the act, the policy of efficient collective bargaining. Where
the policy of an act is so definitely and elaborately stated, this require-
ment acts as a permitted measure of delegated authority.” Pittsburgh
Plate Glass v. NLRB, 313 U.S. 146, 165–166 (1941).
8 Legis. Hist. 1300, 3219–221, 3253–3256, 3264–3269 (NLRA
1935) (1985 reprint); 1 Legis. Hist. at 58–61, 117, 121–122, 299–300,
535–536, 550–551, 584, 612, 636, 643–644, 663, 672–674 (1985 re-
print).
9 The majority also attempts to distinguish cases involving contin-
gent employees from earlier cases, on which Sturgis in part relied,
where the Board consistently found combined units of joint and sole
employees appropriate in department-store settings. By way of exam-
OAKWOOD CARE CENTER 667
By contrast, in the traditional multiemployer bargain-
ing situation, the employers are entirely independent
businesses, often compete with each other, operate at
separate locations on different work projects, and hire
their own employees. They have nothing in common
except that they operate in the same industry. As Sturgis
recognized, the Board developed the consent requirement
in such cases precisely because the employers at issue
were physically and economically separate from each
other, their operations were not intermingled, and their
employees were not jointly controlled.10
B. Sturgis is Consistent with Economic Realities and
the Goals of the Act
In a series of recent decisions, the Board has demon-
strated a disturbing reluctance to recognize changes in
the economy and the workplace and to ensure that our
law reflects economic realities and continues to further

ple, the majority characterizes the department store and single-store
licensee employers in Gallenkamp Stores v. NLRB, 402 F.2d 525 (9th
Cir. 1968) as not only a joint employer but a “joint enterprise—a
unique relationship not present in Sturgis or this case.”
The majority has it backwards. In Gallenkamp, the licensed single-
store operations were integrated into K-Mart’s storewide operation as
whole, self-contained entities. In Sturgis and in this case, by contrast,
the supplier employers retained no separate identity whatsoever within
the user employer’s operation or on the user employer’s worksite: they
were merely an external source of employees who were absorbed and
intermixed among the user employer’s sole employees. The Sturgis
employers and the Employers here therefore comprised a “joint enter-
prise” at their respective common workplaces to a greater extent than
did the Gallenkamp employers.
10 See, e.g., Chapman Dehydrator, 51 NLRB 664, 666–667 (1943)
(multiemployer unit not appropriate absent consent, where there was no
evidence of “any managerial interrelationship between members of the
Association,” and employers “operate . . . as separate and distinct busi-
ness organizations with no interchange of employees”); Sagamore
Mfg., 39 NLRB 909, 915–916 (1942) (same result where employers
were “independent and competing” with each other); F. E. Booth &
Co., 10 NLRB 1491, 1496 (1939) (same result where interchange of
employees between employers was “not effectuated by any plan of [the
union] or through any common agency of the companies” and “each of
the companies hires its own employees as the conditions of its business
require”); Alaska Packers Assn., 7 NLRB 141, 143–144 (1938) (same
result even though “the three companies constitute an economic [re-
gional industry] aggregate,” because they are “separate and distinct
business organizations”). See also Bull-Insular Line, 56 NLRB 189,
193–194 (1944) (Puerto Rico-wide employer unit not appropriate ab-
sent consent, but unit of two employers appropriate where they were
“interlocking corporate organizations” and their employees “together
are engaged in various tasks incidental to the loading or unloading of
cargo vessels at the [two] companies’ piers in the harbor of San Juan”).
Cf. Rayonier, Inc., 52 NLRB 1269, 1274 (1943) (multiemployer unit
appropriate in view of implied consent through collective-bargaining
history, in contrast to cases where employers are merely “competing
companies not otherwise related except through membership in an
employer association”).
the goals that Congress has set.11 The reversal of Sturgis
is part of this unfortunate trend. It represents a failure of
the Board to fulfill its duty.
1. The Board must interpret the Act in light of the rise of
alternative work arrangements
As an administrative agency responsible for enforcing
Congressional policy, the Board has a fundamental duty
to “adapt [its] rules and practices to the Nation’s needs in
a volatile, changing economy.”12 Indeed, “the primary
function and responsibility of the Board . . . is that of
applying the general provisions of the Act to the com-
plexities of industrial life.”13
As the Board itself long has emphasized, specifically
with respect to unit determinations:
Because the scope of the unit is basic to and permeates
the whole of the collective bargaining relationship,
each unit determination, in order to further effective
expression of the statutory purposes, must have a direct
relevancy to the circumstances within which collective
bargaining is to take place. For, if the unit determina-
tion fails to relate to the factual situation with which the
parties must deal, efficient and stable collective bar-
gaining is undermined rather than fostered.
Kalamazoo Paper Box, 136 NLRB 134, 137 (1962). In
short, the Board has a statutory obligation under Section
9(b) to update its approach in determining appropriate bar-
gaining units in accordance with current workplace realities.
In Sturgis, the Board met this obligation. The decision
noted at the outset that according to the General Ac-
counting Office’s (GAO) interpretation of Bureau of
Labor Statistics (BLS) numbers, employment in the tem-
porary help supply industry increased by 577 percent
from 1982 to 1998, while total employment increased by
only 41 percent. 331 NLRB at 1298. Given this signifi-
cant economic development, failure of the Board to ad-
just its law of bargaining units within the terms of Sec-
tion 9(b) would have been arbitrary and contrary to the
Board’s duty.
Information subsequently available only confirms that
the Sturgis Board was right.14 In a report prepared for

11 See MV Transportation, 337 NLRB 770 (2002); Airborne Ex-
press, 338 NLRB 597 (2002); Brown University, 342 NLRB 483
(2004); Brevard Achievement Center, 342 NLRB 982 (2004).
12 American Trucking Assns. v. Atchison, Topeka & Santa Fe Rail-
way, 387 U.S. 397, 416 (1967).
13 Ford Motor Co. v. NLRB, 441 U.S. 448, 496 (1979) (emphasis
added), quoting NLRB v. Insurance Agents, 361 U.S. 477, 499 (1960);
NLRB v. Erie Resistor Corp., 373 U.S. 221, 236 (1963); and NLRB v.
Steelworkers, 357 U.S. 357, 362–363 (1958).
14 Bureau of Labor Statistics, U.S. Department of Labor, “Contin-
gent and Alternative Employment Arrangements, February 2001,”
DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD668
the U.S. Department of Labor, two RAND Corporation
researchers observe that “less-permanent employment
arrangements have taken root and are likely to become
more prevalent in the face of rapid technological change
and competitive market pressures.”15
In many cases, however, it is practically impossible for
supplied employees who work in a joint-employer setting
to organize or to bargain effectively with their joint em-
ployer, unless they can join with the user employer’s sole
employees who work alongside them. By the same to-
ken, the solely employed employees in that setting can be
handicapped in improving their conditions of employ-
ment if they are barred from organizing and bargaining
with the supplied workers.
There is no dispute that many employers use contin-
gent workers simply to reduce their labor costs.16 Em-
ployers get the biggest savings through the limited fringe
benefits provided to contingent workers.17 Another mo-
tivation, of course, is to prevent core and contingent em-
ployees alike from organizing and bargaining effec-
tively.18 It is surely no coincidence that, to date, we can
cite no instance where contingent employees sought and
obtained the consent of both user and supplier employers
to be included in a unit with the user employer’s sole
employees.
Given this reality, it makes no sense for the majority to
say that traditional multiemployer bargaining units help

(May 24, 2001). Other commentators have estimated that contingent
employees comprise between 16 percent and 29 percent of the national
work force. See Stephen Befort, “Revisiting the Black Hole of Work-
place Regulation: A Historical and Comparative Perspective of Contin-
gent Work,” 24 Berkeley J. of Emp. & Lab. L. 153, 158–159 fn. 46–49
(2003) (and sources cited); Tiffany Fonseca, “Collective Bargaining
Under the Model of M.B. Sturgis, Inc.,” 5 U. Pa. J. Lab. & Emp. L.
167, 172 fn. 39 (2002) (and sources cited).
15 Karoly & Panis, supra, The 21st Century at Work, at 192.
16 See Michael Hely, “The Impact of Sturgis on Bargaining Power
for Contingent Workers in the U.S. Labor Market,” 11 Washington U.
J. of L. & Pol. 295, 307, fn. 51 (2003) (and sources cited); Patricia Ball,
“The New Traditional Employment Relationship: An Examination of
Proposed Legal and Structural Reforms for Contingent Workers,” 43
Santa Clara Law Review 901, 915–916 fn. 119–128 (2003) (and
sources cited); Stephen Befort, “Labor and Employment Law at the
Millenium: A Historical Review and Critical Assessment,” 43 B. C. L.
Rev. 351, 369 fn. 121–123 (2002) (and sources cited).
17 Capelli, Change at Work, supra, at 77. See also Pamela Mendels,
“Allowing Temps to Organize,” BusinessWeek online,
http://www.businessweek.com/careers/content/sep2000/ca2000091957.
htm
(“Employers use temps because they are cheaper than permanent
staff: A 1999 Bureau of Labor Statistics study found, for example that
only about 8.5% of temps get health insurance from their employer,
compared to 58% of traditional workers”).
18 Lobel, supra at 116 fn. 27–28; Befort, “Revisiting the Black Hole
of Workplace Regulation,” supra at 163 fn. 80–82; Hely, supra at 308
fn. 55–58; Befort, “Labor and Employment Law at the Millennium,”
supra at 370–371 fn. 129–132; Fonseca, supra at 186 fn. 166.
to “bring about industrial stability for the benefit of all,”
but that Sturgis units would not. The Act does not envi-
sion that “industrial stability” will be achieved by frus-
trating the ability of workers to organize. But this is pre-
cisely what the majority’s decision will do, at worst ac-
celerating the expansion of a permanent underclass of
workers.19 Ironically, the American Staffing Association
itself has cited Sturgis to rebut allegations that temporary
employees are not protected by federal labor law.20
2. Sturgis bargaining units facilitate rather
than hinder collective bargaining
In the majority’s view, of course, the ability of workers
to organize is trumped by other concerns. Our col-
leagues argue that under Sturgis the resulting “bargaining
structure . . . gives rise to significant conflicts among the
various employers and groups of employees participating
in the process.” They cite the prospect that the employ-
ers involved would be forced to “negotiat[e] with one
another as well as with the union,” or that the interests of
the solely or the jointly employed group of employees
“may be traded away” for the other’s, with resulting
“fragmentation” of bargaining.21 The majority also pos-
its several examples of such “conflicts.”
But these conflicts are entirely hypothetical. Neither
the majority nor the employer parties have cited evidence
that any Sturgis unit has created such conflicts or dis-
rupted a bargaining process. Regardless, the solution the
majority endorses—making it virtually impossible for

19 According to a 1999 BLS study of alternative employment ar-
rangements, temporary help agency workers (those most like the Stur-
gis situation) were more likely than other workers to be young, female,
African-American or Hispanic. Relatively few of the young workers in
this arrangement were going to school: just 16 percent were attending
high school or college, compared with 43 percent of young people
working in a traditional job. The great majority of temps worked a full-
time week of at least 35 hours. Of those who worked part time, 41 per -
cent would have preferred a full-time job, compared with only 18 per -
cent of workers in traditional jobs. These workers predominantly
worked in clerical and machine operator occupations. Just one in three
preferred their arrangement to a traditional job. A majority said they
were working in the arrangement because that was the only type of
work they could find. Temporary help agency workers had low earn-
ings. At $329 per week for full-time workers, their median earnings
were about two-thirds of the earnings of traditional workers. Tempo-
rary agencies did not commonly provide health insurance and pension
benefits. Just 46 percent of temps had health insurance from any
source, compared with 83 percent of traditional workers. Pension
coverage was even lower. Sharon R. Cohany, “Workers in Alternative
Employment Arrangements: A Second Look,” Monthly L. Rev., Nov.
1998, Vol. 121, No. 11, at 10–15.
20 American Staffing Association, “The Staffing Services Industry:
Myth and Reality” (February 15, 2001), available at
http://www.staffingtoday.net/staffstats/index.html.
21 The prospect that the employers involved would be forced to ne-
gotiate with one another as well as with the union is, of course, true in
any joint employer situation, not just the Sturgis scenario.
OAKWOOD CARE CENTER 669
certain workers to organize—is worse than the supposed
problem. Perhaps the simplest refutation of the major-
ity’s “policy” rationale is provided by no less reliable a
source than the National Association of Professional
Employer Organizations (NAPEO). NAPEO, on its
website, publicly affirms that its supplier-employer
members operate as “co-employers” with their clients,
and states in the light of Sturgis:
The National Labor Relations Board recognizes that in
co-employment relationships, worksite employees are
appropriately included in the client employer’s collec-
tive bargaining unit. Where a collective bargaining
agreement exists, [professional employer organiza-
tions] fully abide by the agreement’s terms.
http://www.napeo.org/peoindustry/faq.fm#18 (emphasis
added). However, even assuming that the “conflicts” pos-
ited by the majority did arise, they would not differ from the
conflicts that have always existed in any setting where joint
or multiple employers bargain jointly, or even (with respect
to inter-employee conflicts) in the setting of a single em-
ployer. Employees are always required to rank their inter-
ests and to resolve competing interests between employee
sub-groups. That this might occur in Sturgis units, too, is no
reason to prevent employees from choosing them.22
In any case, the Board has long recognized that “the
fact that two or more groups of employees may have
some different interests does not render a combined unit
inappropriate if there is a sufficient community of inter-
est among all of the employees.” Holiday Inn City Cen-
ter, supra, 332 NLRB at 1250; Berea Publishing Co.,
140 NLRB 516, 518 (1963).
Similarly, there are competing employer interests
wherever joint or multiple employers are involved, and
some employers in the group will exert greater leverage
than others. This, again, is the normal byproduct of give-
and-take group bargaining. In a contingent-employee,
joint-employer setting, the user employer may have the
economic power to dictate the management position on
joint employees’ terms of employment. Alternatively,
the employers involved must negotiate their conflicting
interests among themselves, regardless of the nature of
the bargaining unit(s) with which they are dealing.
Contrary to the majority’s assertions, in most settings
where joint employees seek a Sturgis unit, it is because
the user employer, not the supplier employer, holds the
real power to set their terms and conditions of employ-
ment. The true significance of Sturgis units is to make it

22 As Sturgis noted, in S.S. Kresge v. NLRB, 416 F.2d 1225 (6th Cir.
1969), which the majority vainly attempts to distinguish, the Sixth
Circuit made precisely this point. 331 NLRB at 1307 fn. 18, quoting
416 F.2d at 1232.
possible for all the user employer’s employees—both
those solely employed by the user employer and those
jointly employed by the user and supplier employers—to
organize and bargain effectively to improve their terms
of employment.
The Board’s statutory mandate, as we have now said
repeatedly, is “to assure to employees the fullest freedom
in exercising the rights guaranteed by th[e] Act.” 29
U.S.C. §159(b). To the extent that joint employers can
prevent their employees from seeking the most effective
bargaining unit simply by withholding their consent, they
can “shape the unit at will.”23 That result—which exalts
business flexibility at the complete expense of employee
rights—is the opposite of what Congress intended.
Finally, the majority also appears to be barring a peti-
tion seeking to represent only the supplier employer’s
employees, and naming only the supplier employer. How
that holding can be justified under Section 9(b) is myste-
rious. By its holding, the majority essentially requires
employees to bargain in multiple units in every joint em-
ployer case, regardless of the circumstances. After today,
a contingent employee cannot be a member of a bargain-
ing unit that includes the user employer’s sole employ-
ees, even if all of them work at the same worksite and
their work functions are indistinguishable. Nor, how-
ever, can the contingent employee attempt to organize
all, or even some, of his or her fellow-contingent em-
ployees to bargain only with the supplier employer to the
extent that that employer controls their terms of em-
ployment. The only option the contingent employee has
is to organize the other contingent employees to bargain
with both the supplier and user employers, but in com-
plete isolation from the user employer’s own employees.
Similarly, the user employer’s own employees can only
organize in a unit of their own, regardless of the contin-
gent employees who are performing identical work right
next to them. The majority, then, seems to have gone out
of its way to make it impossible for joint employees to
exercise their Section 7 rights effectively. Ironically,
they also seem to be creating a collective-bargaining
nightmare for employers.
V. CONCLUSION
While Sturgis was decided only 4 years ago, it built on
well-established principles, took economic realities into
account, and reversed a relatively recent decision that
itself was out of step with Board precedent. The major-
ity today not only disagrees with Sturgis on policy
grounds, it also argues that Sturgis exceeded the Board’s
statutory authority. If the majority were correct, then the

23 Waterfront Employers Assn., 71 NLRB 80, 111 (1946) (finding a
multiemployer unit appropriate).
DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD670
National Labor Relations Act itself could not guarantee
an important, and growing, segment of American work-
ers the right to collective bargaining. The problem here,
however, is not the statute, but the agency that adminis-
ters it. We dissent.