The Sixth Circuit Court of Appeals recently affirmed the National Labor Relations Board’s controversial ruling in Specialty Healthcare, 357 NLRB No. 83 (2011), which makes it more challenging for employers to successfully challenge smaller bargaining units.
The decision, released August 15, 2013, affirms Specialty Healthcare’s “overwhelming-community-of-interest” test, which makes it easier for unions to organize employees from all industries into smaller units, or “micro-bargaining units.”
The Board’s Specialty Healthcare decision overruled its decision in Park Manor Care Center, 305 NLRB 135 (1991), which set forth the Board’s previous test for determining the appropriateness of a bargaining unit in non-acute healthcare facilities. In Specialty Healthcare, the Board ruled that an employer claiming that the proposed bargaining unit should include additional employees must be able to show that the excluded employees share an “overwhelming community of interest” with the employees in the proposed bargaining unit. Under Specialty Healthcare, numerous decisions have found small units appropriate that would not have been approved under previous Board law. Citing oft-quoted precedent that the Board must select an appropriate unit, but not the most appropriate one, as well as the principle that the Board has the discretion to develop standards for determining the appropriateness of a bargaining unit, the Sixth Circuit found that it was in the Board’s discretion to overrule its own precedent and adopt a test based on prior Board precedent – even if it represented a material change in the law. The Court also rejected the employer’s arguments that the Board improperly changed its bargaining unit standards by adjudication rather than by rulemaking, and that Specialty Healthcare violated Section 9(c)(5) of the NLRA.
In light of the approval of the Sixth Circuit (and an allied decision from the District of Columbia Circuit Court), it is likely that Specialty Healthcare’s “overwhelming-community-of-interest” test will be the rule unless or until the make-up of the Board changes sufficiently, which is unlikely during the remainder of President Obama’s second term, or it is reversed by the U.S. Supreme Court. Moreover, it has been applied in industries beyond non-acute health care facilities. With the increased risk of targeted organizing campaigns aimed at small units of sympathetic employees, the need for employers in all industries to proactively consider union avoidance strategies has never been more important.©2013 Drinker Biddle & Reath LLP. All Rights Reserved