Glenn Spencer
Senior Vice President, Employment Policy Division, U.S. Chamber of Commerce

Published

December 16, 2022

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On December 14, the National Labor Relations Board (NLRB) took a step backward in labor relations. In a case called American Steel Construction, the NLRB in a 3-2 decision replaced a reasonable standard for determining the composition of bargaining units with the flawed process first created under an Obama-era ruling called Specialty Healthcare.

When a union seeks to organize a workplace, it must suggest which workers will be in the bargaining unit.  Traditionally, this meant a unit that would be “appropriate for the purposes of collective bargaining.”  In other words, all employees for whom the union’s bargaining would be relevant.  In many cases this wound up being a “wall-to-wall” unit with all employees at a facility included.

A challenge for unions, however, is that organizing larger groups of workers can be difficult.  The smaller the unit, the higher the chances of success.  Thus, in 2011, the Obama NLRB issued the Specialty Healthcare decision, which put in place a new standard. Unions could now effectively select the individual employees they wished to organize, pretend that this represented a unit appropriate for the purposes of bargaining, and present it to the NLRB. If the employer sought to object, it would have to show that any employees it wished to add shared “an overwhelming community of interest” with the unit requested by the union — an almost impossible standard to meet.

Critics at the time warned that the Specialty Healthcare standard would lead to fractured bargaining units that made little sense.  And indeed that is what came to pass.  A 2016 report by the U.S. Chamber of Commerce highlighted some of the ridiculous bargaining units approved by the NLRB under Specialty Healthcare.  These included a Macy’s store where the union wished to represent just cosmetics and fragrance sales associates rather than all sales associates, a Bergdorf Goodman store where the union wanted to represent shoe salespersons, but only those who sold women’s shoes, and a Panera Bread chain in Michigan where the union sought to organize 17 out of 43 bakers working at six out of 17 cafés.

It remains to be seen if American Steel will result in the same disruption caused by Specialty Healthcare, but if history is any guide the answer is almost certainly yes. The current NLRB has taken another step toward the dysfunctional system of labor law embraced by the Obama administration.

About the authors

Glenn Spencer

Glenn Spencer

Senior Vice President, Employment Policy Division, U.S. Chamber of Commerce

Glenn Spencer is senior vice president of the Employment Policy division at the U.S. Chamber of Commerce.

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