On May 4, 2012, National Labor Relations Board Regional Director, Region 2 (New York City) issued the most recent “micro” unit decision finding appropriate a union’s petition for a bargaining unit of only a small portion of the employer’s workforce – rather than the traditional “wall-to-wall” unit of all similar employees in an employer’s facility.

Relying on the NLRB’s August 26, 2011, decision in Specialty Healthcare, 357 NLRB No. 83, the Regional Director held that the requested unit of “full-time and regular part-time womens’ shoes associates in the 2nd Floor Designer Shoes Department and in the 5th Floor Contemporary Shoes Department” is an appropriate unit considering traditional “community of interest” factors. The Neiman Marcus Group, Inc., d/b/a Bergdorf Goodman, 02-RC-076954.

The Regional Director noted that, although the employer’s contention that a larger unit of all retail sales associates would also be appropriate or even more appropriate, the test is not the single most appropriate unit. Rather, to defeat a union’s petitioned-for unit, the burden is now on the employer to demonstrate that employees in its counter-proposed, larger unit “share an overwhelming community of interest with those in the [union’s] petitioned-for unit.

In Bergdorf Goodman, the Regional Director held the petitioned-for “micro” unit appropriate because the evidence presented indicated differences in pay and benefits between womens’ shoe associates and other store employees; few, if any, transfers into the womens’ shoe department; and that the mens’ shoe associates were located in a different building with little interchange with womens’ shoe associates. The Regional Director distinguished the Board’s long-followed 1957 decision, Bullock’s, Inc. d/b/a I. Magnin & Co., 119 NLRB 642, which held inappropriate a unit of only shoe sales employees in a retail store due to the longstanding presumption of “wall-to-wall” units for the retail sales industry. In that case, the Board commented:

The Board has long regarded a storewide unit of all selling and nonselling employees as a basically appropriate unit in the retail industry… Smaller units of retail clothing store employees are appropriate when comprised of craft or professional employees or where departments composed of employees having a mutuality of interests not shared by other store employees are involved…[T]he record herein fails to establish any craft or professional skills or status among the shoe salesmen and it does not show that the skills, duties, interests, and conditions of employment of those employees are sufficiently different from those of other employees to warrant their establishment in a separate unit on any other basis.

Unfortunately, that was then and “micro” units of whatever size and composition union officials demand is now. This decision highlights the risk at hand: union organizers can “cherry pick” units in which they know that they have sufficient support to win a representation election, imposing unwanted representation on the minority of workers in the “micro” unit who would be in a majority rejecting representation in the traditional “wall-to-wall” unit.

Moreover, “micro” units allow union organizers to get inside an employer’s doors to organize additional groups and demand that the company recognize the union as the “representative” of its other employees. Further, union officials with monopoly bargaining powers over a micro-unit are put in a position where they are incentivized to offer concessions of employees’ interests in return for the company’s organizing assistance in unionizing the larger unit.
Additionally, the risk of expanding representation over time creates uncertainty for employees who may be forced to make a decision about unionization without knowing the true make-up of the ultimate bargaining unit. Meanwhile, multiple competing small unions can create constant conflict between and among represented groups.

What remains to be seen is whether a reviewing court will ultimately overrule the Board’s “micro” unit theory considering the National Labor Relations Act’s Section 9(c)(5) admonition that “the extent to which the employees have organized shall not be controlling” in determining whether a proposed bargaining unit is appropriate. After all, as Board Member Bryan Hayes said in dissent when the Board approved a “micro” unit in Northrup Grumman Shipbuilding, Inc., 357 NLRB No. 163 (2011), “Congress vested the authority to make unit determinations with the Board, not union organizers.”

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