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Latest News - September 2013

September 5, 2013
Latest ruling redefines bargaining units, complicates labor relations
Source: Crain's Cleveland Business
Marc Bloch

Within the past month the Sixth Circuit Court of Appeals (which includes Ohio) upheld a National Labor Relations Board (NLRB) bargaining unit determination in Kindred Nursing Centers (fka Specialty Healthcare).

In doing so, it set into motion changes that should prompt employers to more carefully review their workforces in order to help ward off union efforts to segment workers for organizing purposes. Effectively, the decision allows unions to “pick off” portions of a health care facility to organize. This could certainly result in the over-proliferation of bargaining units at nursing homes and other non-acute health care operations.

However, that may not be the most important result of this decision. What now is evident is that the NLRB will allow sub groups of employees (who do not possess unique skills) to form an appropriate bargaining unit. This will clearly create problems not only in health care, but also in retail operations and other potential bargaining “targets”. In fact, just this week, in light of the Kindred decision, the United Food and Commercial Workers requested the NLRB to count impounded ballots at a Macy's Department store in Saugus, Mass. where the union had “organized” only the cosmetic and fragrance workers in a two-story department store.

The issue began in 2011 with the NLRB in the Kindred case reversing 20 years of precedent when it permitted a discrete bargaining unit, rather than a broad “wall-to-wall” bargaining unit, in a non-acute medical facility. The Sixth Circuit sustained this Obama NLRB-era decision. In this instance the NLRB allowed a union to “pick and choose” what unit at a nursing home it wanted to represent and, of course, what group it did not want to represent. The Court found that, “…we must uphold the Board's interpretation of the Act (National Labor Relations Act) if it is 'reasonably defensible'; we may not reject the Board's interpretation merely because the courts might prefer another view of the statute.”

In that case, the Obama NLRB sought to reverse the 1991 Park Manor Care Center case which mandated larger bargaining units in the health care industry. In 1987, legislation was passed that permitted bargaining in the health care industry but with a caveat to “prevent undue proliferation of bargaining units in the health care field.” The Kindred case was the perfect vehicle to change Park Manor. Consequently, the NLRB determined that an appropriate unit will be acceptable, rather than a larger unit, unless the party seeking a larger bargaining unit can “demonstrate that the excluded employees share an overwhelming community of interest with the included employees.”

The fact that the Sixth Circuit supported the NLRB decision should not come as a total surprise.

The general rule is that the Circuit Court will grant great deference to the rulings of a Federal Administrative agency. As a principle this makes sense, in that it would be difficult for an appellate court to review the factual determination of an administrative agency. The rub in that logic has always been that the federal administrative agency rulings may vary depending on the political party in office.

Without a doubt, more than ever employers must start to create an integrated work force in which employees at many functional levels are cross trained. It will be necessary to flatten out the work force structure so that there is limited supervision directing the talents of a multifaceted work force. Further, and most critically, the need to move quickly on reviewing the work force is stronger than ever.

What does this case portend? It follows the trend of expanding the NLRB's jurisdiction, i.e., to make it more relevant. Will unions outside of the health care industry “jump” on this decision tomorrow? No! But clearly the intent of the Board is to encourage the erosion of the Reagan/Bush precedents that the union “movement” believes have accelerated its fade to the obscure.

At this moment Unions have a difficult time organizing at all, let alone a discrete group of employees. Nevertheless, we all know that there will be a portion of the work population that is receptive to a union “pitch”. If that group can be segmented into an “appropriate bargaining unit”, and if the NLRB institutes an expedited election process (which will surely become a rule by 2014), then labor relations will once again become complicated.

Do not wait until the Union is at the door. It will be too late!




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