NLRB signals change in successorship analysis

Two NLRB Members dropped a footnote indicating that they are ready to revise the analysis of when an employer is a successor under the "perfectly clear" doctrine. Walden Security, Inc., 366 NLRB No. 44 (03/23/2018) [PDF]. So we can expect a change to be coming once the NLRB returns to its full complement of Member – with a Republican majority.

This all goes back to NLRB v. Burns Security Services, 406 U.S. 272 (1972), and Spruce Up Corp., 209 NLRB 194 (1974), and a series of more recent cases interpreting Spruce Up. Specifically, those cases adopt the position that an employer can be found to be a “perfectly clear” successor if it expressed an intent to retain the predecessor’s employees without making it clear that employment would be conditioned on the acceptance of new terms and conditions of employment.

Here is the footnote:

"We adopt the judge’s finding that, under extant precedent, the Respondent was a 'perfectly clear' successor because it expressed an intent to retain the predecessor’s employees without making it clear that employment would be conditioned on the acceptance of new terms and conditions of employment. Chairman Kaplan notes that the judge’s analysis relied on the interpretation of Spruce Up Corp., 209 NLRB 194 (1974), enfd. 529 F.2d 516 (4th Cir. 1975), in Creative Vision Resources, LLC, 364 NLRB No. 91 (2016), enfd. 882 F.3d 510 (5th Cir. 2018), Nexeo Solutions, LLC, 364 NLRB No. 44 (2016), and Canteen Co., 317 NLRB 1052 (1995), enfd. 103 F.3d 1355 (7th Cir. 1997). As previously stated, he disagrees with that interpretation. See First Student Inc., A Division of First Group America, 366 NLRB No. 13, slip op. at 7 (2018) (Chairman Kaplan, dissenting in part). However, he recognizes that these decisions are extant precedent, which applies here in the absence of three votes to overrule them. Moreover, he would find that the Respondent here was a 'perfectly clear' successor even under a narrower interpretation of Spruce Up because it unequivocally offered to employ any interested employee of the predecessor employer without indicating prior to or simultaneously with that offer that there would be new terms and conditions of employment. Member Emanuel agrees that the Respondent was a 'perfectly clear' successor under the facts of this case. However, he is open to reexamining the Board’s 'expresses an intent to hire' standard in an appropriate future case."