In PCC Structurals, Inc., the NLRB overruled its 2011 Specialty Healthcare decision, which allowed for unions to organize employees in so-called “micro-units.” Now, the Board has returned to its traditional, multi-factor “community of interest” test.
The term “micro-unit” refers to a segment of employees that have been separated from a larger group of employees who share similar interests (based on compensation, hours, benefits, supervision, training and skills, interchange with other employees, etc.). These “micro-units” have been criticized for creating unnecessary distinctions between similarly-situated employees. Permitting employers to create units out of smaller groups of employees can make it easier for unions to organize.
The Board traditionally reviewed, on a case-by-case basis, the “community of interests” between employees to determine whether a unit of eligible employees was “appropriate” for bargaining, per the language of the NLRA. Pursuant to this review, the Board might determine that the “appropriate” unit mirrored the unit sought by the union in its petition, or, upon insistence by the employer, it might find that other employees sharing the same “community of interests” must be included in the unit.
In 2011, however, the then-majority of the Board imposed a new framework to determine unit appropriateness. Under the Specialty Healthcare test, the Board first reviewed whether the union’s proposed unit was “readily identifiable as a group” (using factors of the “community of interests” test). If the employer asserted that other employees should be included in the unit to make it “appropriate,” it was required to show that there was an “overwhelming community of interests” with other employees.
In overturning Specialty Healthcare, the Board majority in PCC Structurals found that the decision’s framework “detracts” from the statutory framework of the NLRA, which mandates that the Board decide whether a petitioned-for unit is “appropriate” for bargaining “in each case.” More specifically, the Specialty Healthcare test failed to examine the “community of interests” of all employees, but instead focused just on those identified by the union in the representation petition. Moreover, the Board found that the Specialty Healthcare framework led to an abdication of the Board’s responsibility to determine unit appropriateness by “giv[ing] all-but-conclusive deference to” the union’s desired bargaining unit.
For these reasons, the Board rejected Specialty Healthcare and re-imposed the case-by-case determination of the overall “community of interests” of employees when determining unit appropriateness. Accordingly, we can all bid farewell to micro-units.
Andrew MacDonald is an associate in the firm’s Labor and Employment Department, resident in its Philadelphia office.