Part II: In Employment Law What Is A “Micro-Unit” – and Why Does It Matter?
Earlier this week, the standard established by the NLRB in Specialty Healthcare was discussed. As a quick review, the Specialty Healthcare decision made it easier for small collective bargaining groups known as “micro-units” to form in the workplace. These micro-units are easier to unionize, and the employer is left with the burden of showing why excluded employees of the proposed unit should be included. Specialty Healthcare was decided by the NLRB in 2011 and affirmed by the Sixth Circuit in 2013, but it was not until this summer that employers learned how the NLRB would apply this decision to other industries.
In July, the NLRB issued a decision in Macy’s Inc., 361 NLRB No. 4 (July 22, 2014). In its 3-1 Macy’s decision, the NLRB approved the proposed unit of the retail store that only included the cosmetic and fragrance department salespeople – a total of forty-one employees. According to the NLRB, the unit is appropriate because they are a “readily identifiable group” and “share a community of interest.” The NLRB further held that Macy’s had not met its burden of showing an “overwhelming” community of interest between those employees and the other sales employees in the store’s ten other departments.
Just a few days after the Macy’s decision, the NLRB decided Bergdorf Goodman, 361 NLRB No.11 (July 28, 2014). In Bergdorf, the NLRB unanimously found that the store’s shoe sales team did not constitute an appropriate unit, and therefore could not have their own vote on union representation. The NLRB was concerned with the fact that the shoes sales employees were assigned to different selling areas on separate floors and that the contemporary shoe salespeople were part of a different department – Contemporary Sportswear.
Taken together, the Macy’s and Bergdorf decisions make clear that the NLRB will continue to apply the Specialty Healthcare decision to industries besides healthcare. This could lead to tumultuous times for employees, as unions could seek dozens of separate units (i.e., one for each retail department). An employer could face multiple union negotiations, conflicting demands, and contradictory contract obligations if micro-units emerge in their workplace. Employers should be cognizant of smaller employee groups that could band together as a micro-unit. To defeat claims of a “readily identifiable group,” it may be appropriate to cross-train employees, physically separate departments, and divide functions amongst the whole workforce.