December 21, 2017

NLRB Overrides Specialty Healthcare and Returns to Prior Bargaining Unit Standard

BY: Thomas Lenz, L. Brent Garrett

On Friday night, right before Chairman Philip Miscimarra’s term ended with the National Labor Relations Board, the Board capped its flurry of rulings by issuing one more decision favorable to employers: PCC Structurals, Inc., 365 NRLB No. 160 (Dec. 15, 2017). This decision overruled the NLRB’s 2011 Specialty Healthcare ruling that permitted unions to organize “micro-units” of employees for voting purposes unless the employer could prove an “overwhelming community of interest” between the petitioned-for employees and other employees. Because it was almost impossible to prove an overwhelming community of interest and because the resulting micro-units frequently were those employees most favorable to unionization, employers often faced a difficult challenge contacting a union’s grouping of employees for organizing.

The PCC Structurals decision, like the Board’s other major rulings last week, was issued by the three Republican appointees on the Board, with the two Democrat appointees dissenting. The Board majority returned to the pre-Specialty Healthcare “traditional community of interest standard” to evaluate whether a petitioned-for bargaining unit was appropriate. This test requires “a more vigorous assessment of unit appropriateness, regardless of whether an “overwhelming community of interest exists between excluded employees and those in the petitioned-for unit.” The Board stated that no longer must “extraordinary deference” be given to the petitioned-for unit; rather “the interests of employees both within and outside the petitioned-for unit” should be considered.  

In PCC Structurals, the NLRB reversed the Regional Director’s ruling allowing a unit of 100 welding employees of a manufacturer in Oregon to vote in favor of a union. The Board remanded the case to reevaluate the employer’s argument that the only appropriate unit was all 2,565 production and maintenance employees in the facility. The Board stated the Regional Director should examine whether the petitioned-for unit and the excluded employees:

  • are organized into separate departments;
  • have distinct skills and training;
  • have distinct job functions and perform distinct work;
  • are functionally integrated with the other employees;
  • have frequent contact and interchange with other employees;
  • have distinct terms and conditions of employment; and
  • are separately supervised.

The PCC Stucturals ruling, combined with the NLRB’s stated intent to review union election rules, as noted in our blog post earlier this week, suggests the NLRB’s interest in revamping the election processes modified by the prior Administration and in giving employers a more meaningful opportunity to raise issues and litigate them, where disputed, before an election takes place.

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Thomas Lenz

Thomas Lenz


(626) 583-8600

Thomas Lenz is a partner handling all aspects of labor and employment law issues from the firm’s Pasadena and Cerritos offices. He heads the firm’s traditional labor and National Labor Relations Board practices. He works with employers in all major industries across California and the West. Mr. Lenz currently serves on the Executive Committee of the Labor and Employment Section for the State Bar of California. He also serves as a Lecturer in Law, teaching at the USC Gould School of Law.

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L. Brent Garrett

L. Brent Garrett


(562) 653-3200

Brent Garrett is a partner in the firm's Cerritos and Irvine offices and is a member of the firm’s Private Labor and Employment Group. He exclusively represents management in labor and employment matters. He is also a frequent contributor to the Firm’s Labor Relations Blog, providing analysis and commentary about new developments in the area of traditional labor law.

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