NLRB Decision Makes Small Bargaining Units More Likely

Leah Shepherd By Leah Shepherd December 14, 2022

​A new ruling from the National Labor Relations Board (NLRB) modifies the test used to determine whether a group is an appropriate collective bargaining unit, making it easier for unions to get representation elections, particularly in smaller units. The board released its decision in the case, American Steel Construction, on Dec. 14.

The decision reaffirmed the board's long-standing principle that employees in a petitioned-for bargaining unit must be "readily identifiable as a group" and share a "community of interest." However, if an employer argues that a group meeting these criteria must include additional employees, now the burden is on the employer to show that the excluded employees share an "overwhelming community of interest" with those in the bargaining unit.

"The board's task in assessing the appropriateness of bargaining units is to ensure that workers enjoy—in the words of the National Labor Relations Act— 'full freedom of association,' " said Chairman Lauren McFerran. The recent ruling "is consistent with this principle, ensuring that workers have the ability to organize in the unit of their choosing, so long as it is not arbitrary or irrational."

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Smaller Groups

Unions that struggle to organize an employer's entire workforce have often tried to carve out smaller units of workers with specific job titles or comparable working conditions. Now the board has reverted back to a test created during the Obama administration, called the Specialty Healthcare standard, under which smaller bargaining units are more likely to be approved. A more union-friendly test could spur more labor organizing, with the biggest potential impacts in retail, manufacturing, warehousing and higher education.


SHRM Weighed In on Micro-Units

The NLRB should not return to the Specialty Healthcare standard, which resulted in a proliferation of small bargaining units, commonly referred to as micro-units, according to a Society for Human Resource Management (SHRM) brief filed Jan. 21. Micro-units are smaller and narrower teams, such as the maintenance division at a manufacturing plant but not the production division. 

A return to the earlier standard would "allow unions to more easily get their foot in the door because they will not have to organize large groups of employees," said Molly Kaban, an attorney with Hanson Bridgett in San Francisco. With micro-units, unions "can gain entry into a workforce through a small number of employees and then work to organize larger groups from within."

Not only do micro-units make it easier to unionize, but they also create instability in collective bargaining arrangements, said A. John Harper III, an attorney with Littler in Houston.

(SHRM Online)

Factors Creating a Unit

According to the Specialty Healthcare standard, bargaining units need not be the "most" appropriate to be approved, so long as 1) the unit is readily identifiable as a group based on job classifications, departments, functions, work locations, skills or similar factors; and 2) the employees in the smaller unit share a community of interest according to the traditional criteria. Unions find micro-units to be much easier to organize than large plantwide units.

(Hopkins Carley)

Challenging a Unit

It is not unusual for employers to challenge the petitioned-for unit, arguing that only a larger unit is appropriate, on the belief that the union will be less likely to win the election. While there is always a risk that this strategy would result in an employer ending up with a much larger union, usually there is a reason why the union decided to target only a subset of the workforce. In challenging a micro-unit, an employer could try to show that the excluded employees are functionally integrated with the employer's other employees, have frequent contact with other employees, have the same terms and conditions of employment, and share the same supervisors as the target employees.

Sometimes the scope of a potential bargaining unit can determine the outcome of a union election.

(Vinson and Elkins)

Managers Not Included

The National Labor Relations Act excludes certain individuals, such as agricultural laborers, independent contractors, supervisors and persons in managerial positions, from the meaning of "employees." None of these individuals can be included in a bargaining unit established by the NLRB. Bargaining units also can't include workers who act in a confidential capacity to an employer's labor relations officials.

(SHRM Online members-only HR Q&A)



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