United States: Sixth Circuit Upholds Board’s Decision In Specialty Healthcare

In the first judicial challenge to the NLRB's Specialty Healthcare decision, the U.S. Court of Appeals for the Sixth Circuit has upheld the Board. 

In Specialty Healthcare  the Board held that it will find a petitioned for unit appropriate where the unit is made up of (i) an identifialble group of employees (ii) who share a community of interest with one another. No othere employees could be added to the petitioned-for unit unless they shared an overwhelming community of interest with employees already included by the union.  This opens the door for a multiplity of bargaining units in a single place of employment where, previously, all employees sharing a community of interest would likely have been included in a single unit. We have previously blogged about the Specialty Healthcare case and its impact here, here, here, here, and here

In Kindred Nursing Centers East (f/k/a Specialty Healthcare) v. NLRB, __ F.3d __ (Nos. 12-1027/1174, August 15, 2013), the Sixth Circuit held that the Board has broad discretion when it comes to finding the appropriate bargaining unit, and that it must uphold a Board decision

'[U]nless the employer establishes that it is arbitrary, unreasonable, or an abuse of discretion.'. . . We review deferentially the Board's determination of appropriate bargaining units because '[t]he Board has wide discretion in determining the limit of an appropriate bargaining unit.' . . . We have even gone so far to say that '[n]ormally the Board exercises a discretion bordering on finality in determining the union appropriate for bargaining . . . .'

Slip op. at 9 (citations omitted).

The court addressed four principal arguments asserted by Kindred in support of its position that the new test for bargaining units articulated in Specialty Healthcare was an abuse of the Board's discretion. 

First, Kindred argued that it was an abuse of discretion for the Board to depart from the existing and well-established community of interest standards of its prior precedent.  However, the court stated that an agency may depart from its prior precedents, and provided that "'the departure . . . is explained, our review is limited to whether the rationale is so unreasonable as to be arbitrary and capricious.'"  Slip op. at 10-11 (citations omitted).  Here, the court ruled, because the Board "adopted a community-of-interest test based on some of the Board's prior precedents and . . . did explain its reasons for doing so, the Board did not abuse its discretion in applying a version of its traditional communityof-interest test to find a CNA-only bargaining unit to be appropriate."  Slip op. at 13.

The court next turned to Kindred's argument that the Board abused its discretion by adopting an overwhelming community of interest test to any attempt by an employer to add other employees to the unit.  But the court again held that

the Board did cogently explain its reasons for adopting the overwhelming-community-of-interest standard. The Board explained the need to clarify its law, acknowledging that it had used some variation of a heightened standard when a party (usually an employer) argues that the bargaining unit should include more employees. The Board explained that it "has sometimes used different words to describe this standard and has sometimes decided cases such as this without articulating any clear standard."

Slip op. at 15 (citation omitted).

The court concluded that "[b]ecause the overwhelming-community-of-interest standard is based on some of the Board's prior precedents, has been approved by the District of Columbia Circuit [in Blue Man Vegas, LLC v. N.L.R.B., 529 F.3d 417 (D.C. Cir. 2008)], and because the Board did cogently explain its reasons for adopting the standard, the Board did not abuse its discretion in applying this standard in Specialty Healthcare II."  Slip op. at 16. 

Kindred's third argument for abuse of discretion was that the Specialty Healthcare test is contrary to section 9(c)(5) of the National Labor Relation Act, 29 U.S.C. Sec. 159(c).  Section 9(c)(5) forbids the Board from making the extent of union organizing the controlling factor in determining an appropriate unit.  The company maintained that by requiring an employer to establish an "overwhelming community of interest" between the proposed unit and others who should also be in the unit, the proposed unit would be virtually immune from attack.  Thus, the unit proposed by the union – undoubtedly based on the extent of its organizing – would be the controlling factor in all but the rarest of cases.

The court disagreed, stating its analysis by stating that "Section 9(c)(5) appears to have been added to prevent the Board from . . . [determining] a bargaining unit without applying any kind of community-of-interest analysis, but solely on the basis that the workers wanted to organize a union."  Slip op. at 17. This had happened in a number of NLRB cases before the 1947 Taft-Hartley amendments to the National Labor Relations Act, which added section 9(c)(5).  Ignoring the irony, the court stated that "[t]he Board at that time acted as a union partisan, encouraging organizing."  Id.   The court continued:

But Kindred's argument misses the mark, because here . . . the Board did not assume that the CNA-only unit was appropriate. Instead, it applied the community-of-interest test . . . to find that there were substantial factors establishing that the CNAs shared a community of interest and therefore constituted an appropriate unit—aside from the fact that the union had organized it. Indeed, nowhere in its briefs, nor before the Board, did Kindred dispute that the CNAs shared a community of interest. Therefore, the Board's approach . . . did not violate section 9(c)(5). 

Nor does the overwhelming-community-of-interest test violate section 9(c)(5). In this regard, we find persuasive the District of Columbia Circuit's analysis in Blue Man, which [the Board] relied upon and quoted as holding that "'[a]s long as the Board applies the overwhelming community of interest standard only after the proposed unit has been shown to be prima facie appropriate, the Board does not run afoul of the statutory injunction that the extent of the union's organization not be given controlling weight.'"

Here . . . the Board followed the Blue Man approach, conducting its community-of-interest inquiry before requiring Kindred to show that the other employees shared an overwhelming community of interest with the CNAs. It would appear, then, that [the Specialty Healthcare standard] does not violate section 9(c)(5) of the Act. 

Slip op. at 18-19 (citations omitted).

Finally, the court held that the Board did not abuse its discretion in adopting a generally applicable rule through adjudication instead of rulemaking.  The court quoted NLRB v. Bell Aerospace Co. Div. of Textron, Inc., 416 U.S. 267, 294 (1974), which held that "the Board is not precluded from announcing new principles in an adjudicative proceeding and that the choice between rulemaking and adjudication lies in the first instance within the Board's discretion."  

The court acknowledged that the Supreme Court had added:  "[T]here may be situations where the Board's reliance on adjudication would amount to an abuse of discretion or a violation of the Act." However, the Board said, Kindred had not explained why the Board's election of adjudication in this case amounted to an abuse of discretion or a violation of the Act.  Further, the court noted, the Board had solicited briefs from the parties and the general public, "thereby providing for the opportunity for the public's input, which is one of the hallmarks of notice-and-comment rulemaking under the Administrative Procedure Act."  Slip op. at 19.

*  *  *  *  *  *

The Sixth Circuit's decision in this case has been long awaited.  While the result may be disappointing to employers, it is virtually certain not to be the last word.  While similar cases pending in the Fourth Circuit have been derailed by the recess appointment dispute, other cases are pending before the Board, and NLRB regions continue to apply the Specialty Healthcare test in representation cases.  Over time some of these decisions are sure to work their way through the somewhat ungainly system for obtaining review of Board decisions in representation cases.  The issues may then be put to other circuits, with the distinct possibility of obtaining a different result than that reached by the Sixth Circuit here.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

In association with
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement

Mondaq.com (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of www.mondaq.com

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about Mondaq.com’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to unsubscribe@mondaq.com with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


From time to time Mondaq may send you emails promoting Mondaq services including new services. You may opt out of receiving such emails by clicking below.

*** If you do not wish to receive any future announcements of services offered by Mondaq you may opt out by clicking here .


This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to webmaster@mondaq.com.

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to EditorialAdvisor@mondaq.com.

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at enquiries@mondaq.com.

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at problems@mondaq.com and we will use commercially reasonable efforts to determine and correct the problem promptly.