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NLRB Overrules Specialty Healthcare, Restores Traditional Community of Interest Test When Considering Micro Units

December 19, 2017

By Daniel L. Rowan

In a decision issued late Friday afternoon (PCC Structurals, Case No. 19-RC-202188), the National Labor Relations Board overruled a 2011 decision regarding how the Board will determine whether a group of employees is an appropriate unit for purposes of collective bargaining. As a result of this decision, the Board now will take a much more critical look at petitions to organize small units of employees within a larger organization. In a broader context, this decision is the latest in a series of cases that reflects a change in Board policy far more favorable to employers than under the prior administration.

In Specialty Healthcare & Rehabilitation Center of Mobile, 357 NLRB 934 (2011), the Board concluded that a petitioned-for unit would be deemed appropriate so long as the employees in the unit are readily identifiable as a group and share a community of interest. The Board only required a larger unit if the employer could demonstrate that employees outside the bargaining unit shared an “overwhelming community of interest” with employees inside the unit—a burden that has proven nearly impossible. The Specialty Healthcare decision opened the door for unions to organize so-called “micro units” consisting of small subgroups of employees.

Now the Board has overruled Specialty Healthcare and returned to the traditional community of interest test, which looks not only at the employees in the petitioned-for unit, but also at the interests of the employer’s other workers. The Board stated that returning to the old standard is necessary to balance the rights of workers to organize with the Board’s duty to promote industrial stability and effective collective bargaining. By creating a presumption in favor of the petitioned-for unit that was nearly impossible to overcome, the standard in Specialty Healthcare did not permit the Board to consider whether a unit was appropriate on a case by case basis as required by the National Labor Relations Act.

Whether a group of employees is an appropriate bargaining unit is a fundamental issue whenever a union petitions to represent employees. Under the current election rules, the employer must, in most cases, state its position on this issue seven days after the petition is filed. Although the Board has already started the process to change the current election rules, it will be months, if not years, before that process is complete. The decision in PCC Specialty provides a big boost to employers seeking to fend off micro units. But employers still must be prepared to respond quickly to a union petition.  
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