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Employment Law Client Alert

August 7, 2014

“Micro-Units”:  NLRB Eases The Way For Union Organizing

by Bruce D. Bagley

Even the most casual of observers would have to be wearing blinders not to notice the extraordinary efforts made by the Obama Administration to make it easier for labor unions to organize the non-union workforce. From its promotion of the Employee Free Choice Act (EFCA), which was thankfully aborted by Congress, to the unprecedented and ultimately overturned promulgation of National Labor Relations Board (NLRB) Rules such as the one requiring employers to post notices advising employees of their right to unionize and strike, to the unconstitutional (as found by the Supreme Court) recess appointments to the NLRB by the President, this Administration has placed its thumb squarely on the scale favoring union organizing. The most recent boost to organized labor was the NLRB’s decision in Macy’s, Inc., 361 NLRB No. 4 (July 22, 2014).

When a union petitions the NLRB to conduct an election to determine whether employees desire union representation, the election must take place in “an appropriate unit” for voting, and potentially, bargaining. Where the employer and union cannot agree on what constitutes the appropriate unit, the NLRB makes that determination. Typically, larger units may be more difficult to organize than smaller units, simply because the union has to convince a greater number of individuals to favor representation when the unit is larger. The facts in Macy’s will illustrate.

Macy’s operates a department store in Saugus, Massachusetts, employing about 150 people, with 120 of those involved in selling merchandise. Of those 120, the United Food and Commercial Workers Union sought to represent only 41 employees of a single department, “cosmetics and fragrances.” The Union’s task in organizing a single department is obviously much easier than having to organize all employees, store-wide. Indeed, store-wide appropriate units had been the norm in the retail industry for decades, prior to the issuance of Macy’s, Inc.

In Macy’s, the Board found the petitioned-for unit of “cosmetics and fragrances” department employees to be an appropriate unit, rejecting the Company’s position that the appropriate unit should consist of all store employees, or alternatively, at least all selling employees. For the first time in the retail industry, the Board applied the rationale it had used in Specialty Healthcare and Rehabilitation Ctr. of Mobile, 357 NLRB No. 83 (2011), which stated that an election could be held in a unit limited to the nursing home’s certified nursing assistants (contrary to decades of NLRB jurisprudence in the health care industry holding that certified nursing assistants would be part of a larger “service and maintenance” employees unit).

With the issuance of Macy’s, the Board has confirmed it will consider to be appropriate virtually any petitioned-for grouping of employees that share a “community of interest” with each other. The burden is now squarely on the employer, if it asserts a larger than petitioned-for unit to be appropriate, to prove that the petitioned-for unit employees share an “overwhelming community of interest,” such that there “is no legitimate basis upon which to exclude certain employees from” the employer’s desired larger unit. Unless the employer can demonstrate that employees in the larger unit share this “overwhelming” community of interest with those in the petitioned-for unit, the petitioned-for unit will be deemed appropriate. This is an exceedingly difficult test for any employer to meet, no doubt intended as such by the present Board.

Not only has the Board essentially sanctioned whatever unit the Union finds most conducive to organizing, it has further signaled its intention to resurrect what detractors have dubbed the “Quickie Election” or “Ambush Election” Rule. Public hearings were conducted on the proposed Rule in April, and it is anticipated that the Board will issue its Final Rule later this year. The Rule will dramatically shorten the period of time from the filing of the Union’s petition to the date of the election, from a current median time of around 38 days to as little as 10-21 days. Among various other procedural changes, the Rule will greatly limit the amount of time the employer will have to educate employees regarding the pros and cons of unionization, significantly enhancing the Union’s likelihood of winning the election. And all of these pro-union maneuvers are taking place notwithstanding that under the present system, without enhancements or favoritism, unions are already winning about 65% of the cases where NLRB elections are conducted.

Non-union employers, unless they are extremely confident that none of their employees would ever be willing to sign a union authorization card, should not be sitting back waiting for unions to take advantage of all that the NLRB has given them. There are steps that can be taken now to better position the employer before the union comes knocking. For example, employers may wish to review and possibly revise their organizational structures. Should companies begin to combine departments under common supervision? Should employees in several departments be cross-trained so that jobs can become more interchangeable? Blurring the lines between presently-defined departments could be effective in combating the NLRB’s preference for allowing organizing by department. The more overlap there is between employees in what are now considered separate departments, the more likely the employer can prevail in arguing that the larger unit is appropriate.

If you would like further information on the above or would like to discuss other union avoidance strategies, please contact Bruce D. Bagley or the McNees Wallace & Nurick attorney with whom you regularly work.