NLRB Embraces Micro Units, Fractured Workplaces

In its second precedent-changing decision issued in as many days, the Board reversed course yet again on a major labor law issue—the standard for determining bargaining unit appropriateness, returning to an Obama-era test under which union-preferred bargaining units are essentially rubber-stamped by the Board. 

The pendulum swings back on bargaining unit size: 

• In 2011, the Obama Board created a new standard, in its decision in Specialty Healthcare, for determining bargaining unit sizes based on the “overwhelming community of interest” of workers, which in practice made it easier for unions to organize smaller groups of employees – also known as “micro units” – and create fractured workplaces with multiple bargaining units at a single location.
  
  
•  In 2017, the Trump Board reversed course and replaced the Obama-era standard with its own, under which unions had the burden of proving that employees in a proposed bargaining unit had “sufficiently distinct” interests from those outside of the proposed unit. 

Now, with its decision in American Steel Construction, Inc., the current Board has once again reversed course and returned to the Obama-era standard. HR Policy submitted an amicus brief in the case, urging the Board not to return to the Specialty Healthcare standard. In its decision, the Board claimed that in returning to Specialty Healthcare, it is merely reaffirming its “long-standing principle” that the burden should be on the party challenging a proposed unit to show that excluded employees share an “overwhelming community of interest.” 

Significant consequences for union organizing success: The new (old) standard will likely usher in a new wave of micro units and fractured workplaces. Under the renewed Specialty Healthcare standard, employers can expect to see unions carve out small groups of employees within the same workplace for organizing, and the Board approving such proposed units. The consequences of this type of organizing are significant, as unions win elections at a much higher rate in smaller bargaining units. Further, as a result, employers may be faced with multiple bargaining units within one plant, floor, store, or production line, and consequently, may be forced to engage in multiple different collective bargaining negotiations for a single location, at significant expense.

Outlook: Significant Board activity is clearly ramping up as the year comes to a close, with the American Steel decision coming right on the heels of the Board’s decision in Thryv in which it expanded the types of damages employers might be liable to pay to employees for unfair labor practices. This pace of decisions is likely to continue or accelerate through the end of the year and into 2023, as Member John Ring’s term expires December 16. 

Keep up with these changes and more at our upcoming FWPC webinar: Examining NLRB Decisions and the Implications for Employers on January 11, 2023. More information and registration details can be found here.