Specialty Healthcare Webinar (March 2012) - Retail Industry ...

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Specialty Healthcare Webinar (March 2012) - Retail Industry ...

Retail Industry Leaders Association –

Specialty Healthcare as Applied

Mark Theodore

mtheodore@proskauer.com

Ronald Meisburg

rmeisburg@proskauer.com

PROSKAUER ROSE LLP

March 29, 2012

1


Specialty Healthcare and Rehabilitation Center

of Mobile, 357 NLRB No. 83 (August 26, 2011)

• Identified new two-step test:

- (1) Are employees identifiable as a group (job titles,

for example)?

- (2) Do they share a community of interests?

• If so, petitioned-for unit is appropriate unless

demonstrated otherwise under an “overwhelming

community of interests” test.

• Language in decision does not limit its application to

the non-acute health care institutions.

2


Specialty Healthcare and Rehabilitation Center

of Mobile, 357 NLRB No. 83 (August 26, 2011)

• Key passage:

“We therefore take this opportunity to make clear that, when

employees or a labor organization petition for an election in a unit of

employees who are readily identifiable as a group (based on job

classifications, departments, functions, work locations, skills, or

similar factors), and the Board finds that the employees in the group

share a community of interest after considering the traditional

criteria, the Board will find the petitioned-for unit to be an appropriate

unit despite a contention that employees in the unit could be

placed in a larger unit which would also be appropriate or even

more appropriate, unless the party so contending demonstrates that

employees in the larger unit share an overwhelming community of

interest with those in the petitioned-for unit.”

357 NLRB No. 83, Slip op. at 12-13 (footnotes omitted)

3


Overwhelming Community of Interest Required

to Show Unit Inappropriate

• Employer can only challenge unit by

showing that the employees included

and excluded from a unit share an

“overwhelming community of interests”

• Board said this requires interests of

included and excluded employees to

"overlay almost completely"

4


Typical Community of Interest Factors

• Functional integration of jobs

• Common management and administrative control

• Common day-to-day supervision

• Identical or strongly similar compensation and working

conditions

• Interchange and contact between groups

• Geographical proximity

• Identical or strongly similar job classifications, skills,

training and education

• Lack of “disparity of interests”

5


Judicial Review

• Requires employer who loses election in an inappropriate unit to

refuse to bargain with the union

- Union files “refusal to bargain” unfair labor practice complaint

- GC issues complaint and prosecutes as a “technical 8(a)(5)” case

- Employer defends on basis that unit was inappropriate

- Case heard by ALJ whose decision is appealable to NLRB

- NLRB decision reviewable by a U.S. circuit court of appeals, then

possibly by U.S. Supreme Court

• Current lead case is Kindred Nursing Centers East, LLC (f/k/a

Specialty Healthcare) v. NLRB, Case No. 12-1027 (6 th Cir.)

- Petitioner’s Brief due April 16, 2012.

- Amicus Brief due April 23, 2012

6


Odwalla, Inc.,

357 NLRB No. 132 (December 9, 2011)

• Parties stipulated to an election in the following unit:

- “All full-time and regular part-time route sales drivers, relief drivers,

warehouse associates, and cooler technicians, employed by the

Employer at its . . . facility.”

- Parties could not agree on whether merchandisers should be

included, so they voted subject to the union’s challenge.

• The one merchandiser who attempted to vote was challenged by

the union.

- It was a determinative challenge so the Region had to resolve it by

determining whether the merchandisers were in or out of the unit.

- Relying on Specialty Healthcare, the Region sustained the challenge

on the basis that merchandisers did not share an “overwhelming

community of interest” with the other employees in the unit.

7


Odwalla, Inc.,

357 NLRB No. 132 (December 9, 2011)(continued)

• Board reversed the Region, stating that “the Employer has carried

it burden of proving there is no rational basis for excluding the

merchandisers while including all the other classifications in the

unit.”

• The community of interest shared by employees in the requested

unit was “equally share[d]” by merchandisers, such that the

community of interest factor would not “reasonably support”

exclusion of the merchandisers.

• Board described the unit without the merchandisers as a

“fractured unit,” stating “there is no rational basis for excluding the

merchandisers while including all the other classifications in the

unit.”

8


Odwalla, Inc.,

357 NLRB No. 132 (December 9, 2011)(continued)

• Board focused on the fact that the proposed unit excluding the

merchandisers did not track any lines drawn by the employer,

such as

- Classification – the proposed unit included several classifications

- Departmental – the proposed unit included several departments

- Function – some employees in proposed unit had functions closer to

merchandisers than to other employees in the unit

- Compensation – the proposed unit included employees who were

compensated with various combinations of salary, wage, bonus and

commission

- Location – employees were at different locations and spent differing

amounts of time at such locations

9


Odwalla, Inc.,

357 NLRB No. 132 (December 9, 2011)(continued)

• “For the reasons discussed above, we conclude that

the Employer has carried its burden of proving that the

merchandisers share an overwhelming community of

interest with the employees in the recommended unit

because none of the traditional bases for drawing

unit boundaries used by the Board supports

excluding the merchandisers while including the

remaining employees.” (Emphasis added.)

10


Odwalla, Inc.,

357 NLRB No. 132 (December 9, 2011)(continued)

• “[O]ur conclusion rests on a finding that . . . no

rational basis exists that would support drawing

the line between included and excluded employees . .

. .”

• In this case, the “overwhelming community of interest”

standard was in effect preempted by the lack of any

rational basis for finding that the employees in the

recommended unit constituted a “readily identifiable

group.”

11


Member Hayes’ Concurring Footnote in Odwalla

• Member Hayes did not dissent. He instead concurred in the

result. In a personal footnote (n. 29), he stated:

- A fractured unit is not appropriate as a matter of law;

- He adheres to his dissent in Specialty Healthcare;

- The mere fact that a petitioned-for unit does not track lines of

job classification, department or function is not dispositive;

- He instead relies on Board precedent against allowing

representation in “an arbitrary segment” of an otherwise

appropriate unit, and that do not allow “fractured units”, i.e.,

units that are too narrow in scope or that have no rational

basis.

12


Northrop Grumman Shipbuilding, Inc.,

357 NLRB No. 163 (December 30, 2011)

• Region directed an election in a unit consisting of radiological

control technicians and trainees, and laboratory technicians, in

the employer’s E85 RADCON department.

• Employer asserted that smallest appropriate unit must include all

technical employees.

• The Board affirmed the Region

- said in Specialty Healthcare that the decision was “not intended to

disturb any rules applicable only in specific industries” (other than the

non-acute healthcare industry.

- acknowledged it had previously held that “[w]hen technical employees

work in similar jobs and have similar working conditions and benefits,

the only appropriate unit for a group of technicals must include all

such employees similarly employed” (quoting previous decisions).

13


Northrop Grumman Shipbuilding, Inc.,

357 NLRB No. 163 (December 30, 2011)(continued)

• On the other hand, the Board also has held that

- “the Act does not compel . . . representation [even of technical

employees] in the most comprehensive unit unless such grouping

constitutes the only appropriate unit,” and

- “if a subset of an employer’s technical employees share a community

of interest that is ‘sufficiently distinct’ from that of other technicals,

separate representation may be appropriate” (quoting previous

decisions).

• Thus, the Board stated, it has “arguably” developed a different

standard for determining whether a subset of a technical unit is

appropriate: “only when the employees in the requested unit

possess a sufficiently distinct community of interest apart

from other technicals to warrant their establishment as a

separate unit.” (Emphasis added by Board.)

14


Northrop Grumman Shipbuilding, Inc.,

357 NLRB No. 163 (December 30, 2011)(continued)

• The Board said the technicians in the requested unit

constituted a “sufficiently distinct” unit

- Job function solely to promote safety; other

technicals support production

- Contact with other technicals is brief and limited

- checking dosimeters

- for only a portion of the time a ship is under

construction

- Skills are unique and required different training than

for other technicals

15


Northrop Grumman Shipbuilding, Inc.,

357 NLRB No. 163 (December 30, 2011)(continued)

• Does the Board’s focus on the “sufficiently distinct”

standard --

- Muddle the burden –

- is it up to the employer to prove “overwhelming

community of interests”, or

- on the petitioning union to prove “sufficiently

distinct”, or

- on the employer to prove “not sufficiently

distinct”?

- Depend on whether Board is dealing with

presumptively appropriate units?

16


Member Hayes’ Dissent in Northrop Grumman

• The proper standard “never addresses, solely and in isolation, the

question whether employees in the unit sought have interests in

common with one another. . . . Our inquiry . . . necessarily

proceeds to a further determination whether the interests of the

group sought are sufficiently distinct from those of other

employees to warrant the establishment of a separate unit”

(quoting Newton-Wellesley Hospital, 250 NLRB 409 (1980).

• “Until quite recently . . . the Board has consistently held that a

petitioned-for unit will be found appropriate only if the employees

in question have interests in common . . . and the ‘interests of the

group are sufficiently distinct from those of other employees to

warrant the establishment of a separate unit’” (quoting Wheeling

Island Gaming, Inc., 355 NLRB No. 127 (2010)).

• These formulations place the burden on the petitioning union.

17


Member Hayes’ Dissent in Northrop Grumman

(continued)

• “[I]t is entirely appropriate – if not required – for the Board to take

into account the adverse impact of a potential multiplicity of small

bargaining units in fulfilling its statutory mandate to prevent

disruptions of commerce resulting from industrial strife.”

• The Specialty Healthcare standard “will encourage petitioning for

small, single-classification and/or single department groups of

employees . . . . [which will] lead to the balkanization of an

employer’s unionized workforce, creating an environment of

constant negotiation and tension resulting from competing

demands of the representatives of numerous micro-units.”

18


DTG Operations, Inc.,

357 NLRB No. 175 (December 30, 2011)

• Region found petitioned-for unit of lead and regular rental service

agents to be under-inclusive because the employer proved an

overwhelming community of interest existed with the remaining

employees at this car rental facility.

• Union refused to proceed to an election in the larger unit and

requested review of the Region’s decision.

• The Board reversed the Region.

- Agreed with Region that there are no presumptively appropriate units

in the car rental industry.

- Disagreed that the employees outside the petitioned-for unit shared

an overwhelming community of interests with the lead and regular

service agents in the unit.

19


DTG Operations, Inc.,

357 NLRB No. 175 (December 30, 2011)(continued)

• Board said that under Specialty Healthcare it examines “whether

the employees are organized into a separate department; have

distinct skills and training; have distinct job functions and perform

distinct work, including inquiry into the amount and type of job

overlap between classifications; are functionally integrated with

the Employer’s other employees; have frequent contact with other

employees; interchange with other employees; have distinct

terms and conditions of employment; and are separately

supervised.” Id., slip op. at 9.

• This sounds more like a “sufficiently distinct” test than a

“community of interest” test, but the sufficiently distinct standard

was not mentioned in this case (unlike Northrop Grumman).

20


DTG Operations, Inc.,

357 NLRB No. 175 (December 30, 2011)(continued)

• Indeed, the Board considered the following community of interest

factors that the included employees did not share with the

excluded employees:

- Separate work location (inside rental office)

- Distinct duties (sales)

- Distinct functions (contract processing)

- Distinct compensation system (quotas and other performance

expectations)

- Distinct equipment (computers)

- Distinct experience requirements

- Different uniforms

- Little or no interchange

- Predominantly separate supervision

21


Member Hayes’ Dissent in DTG Operations

• Criticized the Board for overturning factual findings of the Region

even though they are subject to a “clearly erroneous” standard.

• Stated that it is “difficult to imagine a multiclassification,

multifunction workplace” where the distinctions of the type drawn

in this case could not also be drawn.

• All a union need do is avoid petitioning for a unit that is a socalled

“fractured unit,” as found in the Odwalla case.

• “I adhere to the . . . view that giving the Board’s imprimatur to this

balkanization represents an abdication of our responsibility under

Section 9 and may well disrupt labor relations stability by

requiring . . . constant . . . bargaining for each micro-unit as well

as pitting the narrow interests in one such unit against those in

other units.”

22


Requests for Review Granted

• Grace Industries LLC, Cases 29-RC-12031 and 29-RC-12043

- Prior to Specialty Healthcare decision, Region directed election in

essentially a large “wall-to-wall” road construction unit. A competing

petitioning union had sought a unit limited to asphalt pavers only.

- Board unanimously granted the competing union’s request for review

and remanded to Region for further consideration in light of Specialty

Healthcare.

- Region’s second DD&E stated that Specialty Healthcare was not

intended to apply to competing union petitions, such that the union

seeking the larger unit would always have to justify that unit by

showing that it shared an overwhelming community of interest with

the smaller unit. The Region reaffirmed its original DD&E.

- Second request for review granted by unanimous Board on February

8, 2012, and briefs were due March 12, 2012 (not yet posted on line).

23


Requests for Review Granted (continued)

• Performance of Brentwood, LP, Case 26-RC-063405

- Case involved complicated questions regarding whether

- the single facility presumption applies to a car dealership’s new car facility

and separate certified used car facility;

- if the single facility presumption applies, the employer properly rebutted it;

- the petitioned-for unit limited to service, lube and diagnostic technicians

and workflow coordinators would be appropriate in any event; and

- the Region erred, under standard announced in Specialty Healthcare, in

finding a unit based both on craft status and traditional community of

interest standards which included service, lube and diagnostic technicians

and workflow coordinators but excluded service advisors and get ready

and detail technicians.

- Employer’s request for review unanimously granted and remanded for

consideration in light of Specialty Healthcare.

- Grant of review of November 4, 2011, vacated at the request of the employer

on November 11, 2011.

24


Request for Review Denied with Dissent

• First Aviation Services, Inc., Case 22-RC61300

- Region directed election in unit consisting of all line service and lead

technicians, but excluding all other employees at a business providing

services for corporate and general aviation customers.

- Employer appealed, arguing that

- Region failed to first determine whether the recommended unit

was “sufficiently distinct” – the employer argued that this was

necessary before the “overwhelming community of interest” test

would even come into play.

- Region misapplied the “overwhelming community of interest” test

- Region assigned improper weight to extent of organization

- Board denied request for review on October 19, 2011, Member Hayes

dissenting.

25


Request for Review Denied with Dissent

(continued)

• Extendicare Homes Inc. d/b/a Texas Terrace Care Center,

Case 18-RC-70382

- Region directed election in unit consisting of Nursing Assistants and

Trained Medical Aides, excluding Cooks and Dietary Assistants

sought by the employer.

- Employer’s request for review argued

- the excluded employees shared an overwhelming community of

interest with the Nursing Assistants and Trained Medical Aides,

relying heavily on Odwalla decision;

- The Board should return to the Park Manor Care standard.

- The Board denied review on January 24, 2012, Member Hayes

dissenting.

26


Request for Review Denied with Dissent

(continued)

• Prevost Car U.S. d/b/a Nova Bus, Case 03-RC-071843

- Region ordered election in unit consisting only of vehicle assemblers,

excluding eight other classifications at the vehicle plant.

- Employer requested review and argued

- the Region erred in finding that none of the additional job

classifications shared an overwhelming community of interest with

the assemblers;

- the Region erred in analyzing the case as if the employer sought

only a wall-to-wall unit, rather than analyze each of the eight

additional classifications individually;

- the Board should reconsider application of the “overwhelming

community of interest” test to initial unit determinations.

- The Board denied review on March 15, 2012, Member Hayes

dissenting.

27


Request for Review Denied Without Dissent

• Oliver C. Joseph, Inc., Case 14-RC-12830

- Pre-Specialty Healthcare decision in which Region directed election at an auto

dealership in unit of journeymen mechanics, service technicians, and lube and

oil employees, and excluding detail employees, on the basis that

- the included employees constituted a craft unit; and

- in any event, the detail employees “did not share such an overwhelming

community of interest” with the included employees so as to render the

unit inappropriate

- Employer’s request for review did not make any arguments based on

Specialty Heathcare.

- Board denied reivew on September 7, 2011, and stated that “the Regional

Director’s analysis is consistent with Specialty Healthcare and we would deny

review here whether or not Specialty Healthcare applies.”

- In a concurring footnote, Member Hayes said he did not rely on the Region’s

“overwhelming community of interest” analysis or finding that the unit was a

craft unit, but instead stated the unit was appropriate under traditional

community of interest standards.

28


Request for Review Denied Without Dissent

(continued)

• Nestle Dryer’s Ice Cream, Case 31-CA-66625

- Region directed election in unit of maintenance employees, excluding

production employees sought by employer.

- Employer’s request for review argued

- due to previous organizing and election victory in production and

maintenance unit (later vacated by Sixth Circuit), Specialty Healthcare was

not applicable by its terms (“where there is no history of collective

bargaining”);

- Board should “reevaluate” the Specialty Healthcare decision;

- Regions finding that production employees did not share overwhelming

community of interest with maintenance employees was clearly erroneous.

- Board denied review on December 28, 2011.

- Member Hayes’ concurring footnote disavowed reliance on “overwhelming

community of interest” test and instead said maintenance unit was appropriate

based its being “sufficiently distinct” from the production employees.

29


Request for Review Denied Without Dissent

(continued)

• Bread of Life, LLC, Case 7-RC-72022

- Region directed election in unit comprised of employer’s six restaurants

located in the employer’s I-94 Corridor administrative district, excluding 11

other of the employer’s restaurants located in the West Michigan market in

other administrative districts.

- Region relied on employer’s organizational structure and other community

of interest standards to find that the I-94 Corridor stores were a “defined

area”;

- Region also found that employees at stores in other districts did not share

overwhelming community of interest with I-94 Corridor district employees.

- Employer sought review, but brief is not yet available on Board web site.

- Board denied review on March 21, 2012, but stated in a footnote:

- “[W]e find that the petitioned-for employees share a community of interest

that is distinct from that of the employees excluded by the Regional

Director . . . .”

- “We do not reach the question of whether the Board’s test in Specialty

Healthcare . . . applies.”

30

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