United States: Union Organizing Made Easier

Last Updated: January 12 2017
Article by Brian E. Hayes

Micro-units upheld. In 2016, several federal appellate courts upheld the National Labor Relations Board's 2011 Specialty Healthcare decision, which departed from Board precedent to sanction union elections among small "micro"- units within a company. Employers and business groups have consistently opposed the decision, arguing that organizers could cherry-pick small segments of employees to target in a union organizing campaign. Employers have argued that the balkanization of the workforce and the collective-bargaining process that Specialty Healthcare's "overwhelming-community-of-interest" standard engenders is contrary to the letter and spirit of the National Labor Relations Act (NLRA).

Unfortunately, the federal appellate courts have sided with the current NLRB and rejected the arguments from employers to the effect that the Specialty Healthcare standard is fatally flawed. For example, the United States Court of Appeals for the Fifth Circuit ruled that a retailer failed to show a unit consisting solely of cosmetics and fragrances employees at one of its stores was clearly not appropriate or that the Board had abused its discretion by adopting and applying Specialty Healthcare's overwhelming- community-of-interest test.

The retail employer had argued that the unit approved by the Board was clearly not appropriate because all sales employees at the store represented "a homogenous work force." The Board, however, found "little evidence of temporary interchange between the petitioned-for employees and other selling employees." Although the unit argued for by the employer may have also been "an appropriate bargaining unit," the appellate court found that it could not say the smaller unit approved by the Board was "clearly not appropriate" based on the employees' "community of interests." Concluding that in Specialty Healthcare the Board "clarified—rather than overhauled—its unit determination analysis," the court granted enforcement of a Board order finding that the bargaining unit was appropriate and that the employer unlawfully refused to bargain.

Just a month earlier, the United States Court of Appeals for the Fourth Circuit ruled that the Board did not violate the NLRA or abuse its discretion when it certified a bargaining unit comprised solely of maintenance employees at an ice cream production facility. Rejecting the assertion that even under Specialty Healthcare's overwhelming-community-of- interest standard, a maintenance-employee-only unit was improper, the Fourth Circuit explained that the employer overstated the significance of the Board's decision. As such, the court denied the employer's petition for review and enforced the Board's order finding that the employer unlawfully refused to bargain with the union.

Two months after the Fifth Circuit's decision, the United States Court of Appeals for the Third Circuit also upheld the Specialty Healthcare standard. The Board's interpretation of the standard for unit determination was reasonable and it properly applied that framework, the appellate court said, refusing to grant an employer's petition for review based on its claim that dockworkers should have been included in a bargaining unit of city and road drivers.

While the employer argued that the Specialty Healthcare Board failed to provide a reasoned explanation for the "adoption" of the overwhelming-community-of-interest test, the Third Circuit found that the ultimate holdings of Specialty Healthcare with respect to the unit-determination standards were not departures from Board precedent. The appellate court also rejected the company's contention that the Specialty Healthcare Board's overwhelming-community- of-interest test violated Section 9(c)(5) of the NLRA because it ensured that the union's choice was almost always the controlling factor. The employer offered no showing that the Board privileged the unit determinations of employees. Rather, the Board has been clear that it will not approve "fractured" units or arbitrary segments of employees, the appellate court said. Thus, the overwhelming-community-of- interest test clarified in Specialty Healthcare did not conflict with Section 9(c)(5).

The current Board majority continues to consistently support the Specialty Healthcare test. For example, in April 2016 a Board majority in Volkswagen Group of America, Inc. denied Volkswagen's request for review of a Regional Director's decision directing a union election among a micro-unit of maintenance workers at the automaker's Chattanooga, Tennessee, plant. Volkswagen asked the Board to reverse the decision approving a United Auto Workers (UAW) election within a discrete 160-employee group after the union's earlier bid to organize the entire 1,400-worker plant failed. UAW Local 42 won an election among the smaller unit, with over 70 percent of the maintenance workers voting in favor of the union. But Volkswagen refused to bargain, contending the bargaining unit was inappropriate. A 2-1 Board majority concluded that Volkswagen raised no substantial issues that warranted Board review, and upheld the decision and direction of election, finding the petitioned-for unit satisfied Specialty Healthcare criteria.

"Quickie" election rule upheld. Also in 2016, the Fifth Circuit, in Associated Builders and Contractors of Texas, Inc.v. NLRB, upheld the Board's controversial "quickie" election rule, which modifies the procedures for union representation elections. The modified procedures significantly accelerate the NLRB's union election processes, limit the ability to litigate legal issues prior to the election, and provide unions with enhanced employee contact information. In affirming a lower court ruling that refused to enjoin the rule, the Fifth Circuit found that the rule did not, on its face, violate the NLRA or the Administrative Procedure Act (APA).

Employer groups had challenged three categories of rule provisions:

  1. rule changes that limit the scope of the pre-election hearing, particularly the deferral of individual voter eligibility issues;
  2. rule changes that require employers to disclose to unions personal employee information; and
  3. rule changes that cumulatively shorten the time period between petition and election to less than 30 days.

To succeed on their facial challenge, the employer groups had to show that "no set of circumstances exists under which the [Rule] would be valid." Emphasizing the high burden faced by the plaintiffs, the appellate court held that the challenged provisions neither exceeded the scope of the Board's authority under the NLRA nor violated the APA's arbitrary and capricious standard.

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.

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