Bob's Tire Co., Inc. v. NLRB, 980 F.3d 147

Background

Bob’s Tire Company operated a tire-recycling yard whose workers (loaders, unloaders, machine operators, yard workers, inspectors, etc.) were represented by UFCW Local 328 after a Board certification on Oct. 1, 2015.
On Nov. 6, 2015 Bob’s contracted with Masis Staffing to supply workers (Masis employees were Masis’s employees, not Bob’s); Masis furnished 111 workers through Oct. 15, 2016, and 101 performed the same general labor routinely done by the bargaining-unit.
Bob’s did not notify or bargain with the Union before subcontracting unit work to Masis, nor did it disclose the Masis contract when the Union requested unit-employee lists and service-agreement information.
Separately, Bob’s unilaterally instituted a performance-based bonus program in Jan. 2016 and terminated it in Sept. 2016 without giving the Union notice or an opportunity to bargain.
The ALJ found violations for (1) subcontracting unit work without bargaining, (2) failing to pay a 2015 Christmas bonus (ALJ finding later rejected by the Board), and (3) unilaterally implementing and rescinding the 2016 performance-based bonuses. The Board adopted the ALJ’s subcontracting and 2016-bonus findings, ordered cease-and-desist, bargaining on request, make-whole relief where appropriate, and restoration of the bonus pending bargaining.
Bob’s petitioned for review, arguing the subcontracted work was not unit work (or caused no loss of hours/jobs), alternatively that Masis was a joint employer, and contesting the bonus ruling; the Board cross-petitioned for enforcement.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Duty to bargain before subcontracting unit work	Union/Board: Bob’s was required to notify and bargain before subcontracting unit work	Bob’s: Masis work was not unit work or reflected a change in scope/direction exempting bargaining	Court: Substantial evidence supports Board — Masis performed the same work under similar conditions; duty to bargain applied
Relevance of adverse impact (layoffs/hours) to duty to bargain	Board: Duty exists regardless of layoffs; subcontracting harms bargaining interests (OT, new hires, unit expansion)	Bob’s: No layoffs or lost hours, so no duty/remedy needed	Court: Duty to bargain is not limited to layoffs/replacements; adverse impact for remedy to be addressed in compliance proceedings
Joint-employer status of Masis	Bob’s: Masis and Bob’s were joint employers; Masis workers should have been in the unit	Board: Masis workers were Masis employees per contract; not joint employers	Court: Rejected joint-employer claim; substantial evidence shows Masis controlled hiring/discipline and workers were not Bob’s employees
Reviewability of challenge to 2016 bonus ruling	Bob’s: Challenges ALJ/Board finding on unilateral bonus implementation/termination	Board: Bob’s failed to raise exception before the Board, so court review barred	Court: No jurisdiction to consider bonus challenge because Bob’s did not present it to the Board

Key Cases Cited

Fibreboard Paper Prods. Corp. v. NLRB, 379 U.S. 203 (subcontracting unit work to independent contractor ordinarily triggers duty to bargain)
First Nat’l Maint. Corp. v. NLRB, 452 U.S. 666 (duty to bargain may be limited where subcontracting represents a change in scope/direction only if benefits outweigh burdens)
Litton Fin. Printing Div. v. NLRB, 501 U.S. 190 (employer may not unilaterally change terms and conditions without bargaining to impasse)
Sure-Tan, Inc. v. NLRB, 467 U.S. 883 (compliance proceedings are the proper forum for concrete backpay determinations)
Ford Motor Co. v. NLRB, 441 U.S. 488 (deference to Board construction of the NLRA when reasonably defensible)
Regal Cinemas, Inc. v. NLRB, 317 F.3d 300 (D.C. Cir.) (standard for review of Board findings and mandatory subjects of bargaining)
Int’l Longshore & Warehouse Union v. NLRB, 890 F.3d 1100 (D.C. Cir.) (standards for upholding Board decisions)