This is another case in which the NLRB has applied its decision in the Specialty Healthcare case to allow employees to create a bargaining unit that is small and underinclusive. The Board’s decision was appealed to a federal appeals court, and the NAM and other filed an amicus brief arguing that the Specialty Healthcare decision was wrong and violated at least two provisions of the National Labor Relations Act. An employer should not have to bear the burden of demonstrating that a proposed bargaining unit should include additional employees who share “an overwhelming community of interest with the included employees.”
In this case, the company argued that a unit of technical employees working in one department at its shipyard should include all the technical employees at that location. We argued that the Board’s rule eliminates important considerations in determining the breadth of the bargaining unit, and will disrupt the smooth operation of the company processes at a time when American employers face unprecedented economic and competitive pressures. The rule also places too much weight on the grouping selected by the organizing employees, thus effectively violating a statutory provision that the “extent to which the employees have organized shall not be controlling.” In addition, the statute requires the bargaining unit decisions assure employees the fullest freedom in exercising their legal rights, but the Board’s rule failed to consider the rights of employees to refrain from collective activities. By allowing small bargaining units, the Board effectively denies the rights of a majority of the remaining workers to refrain from having union representation in an appropriately defined unit.
This is another example of how the Board’s new ruling fosters disruptions that smaller or multiple bargaining units can have on business operations, stable labor relations, and realistic collective bargaining. A unit determination should reflect an employer’s functional integration and the resulting “community of interests” shared by its employees. Smaller units reduce employer flexibility and employee advancement opportunities as separate units isolate employees in different seniority systems and job classifications.
On 7/17/2013, the Fourth Circuit ruled that the NLRB did not have a quorum to issue the decision in this case, because three recess appointments to the Board were unconstitutional. But it also upheld the selected bargaining unit under the standard that was in place prior to the Specialty Healthcare decision, thus avoiding any decision on the propriety of the standard adopted in that case. Although the employees in this case possessed a sufficiently distinct community of interest to qualify for their own bargaining unit, the court refused to enforce the Board's order because it was not properly constituted. Subsequently, the Board issued another decision in October 2014 that required Huntington Ingalls to bargain with the micro-bargaining units. Huntington Ingalls then filed a petition of review of the Board’s order, claiming that the Board did not have jurisdiction, but the 4th circuit enforced the Board’s order.