Several of the country’s largest business groups have joined forces to stop the proliferation of “micro-units” in the retail industry. Last week, the National Labor Relations Board granted the U.S. Chamber of Commerce, the National Association of Manufacturers, the International Federation of Independent Businesses, and various other groups permission to file a joint amicus brief seeking review of the Board’s November 2012 certification of a bargaining unit consisting of 41 cosmetics and fragrance workers from a single Macy’s store in Saugus, Massachusetts. Macy’s, Inc. and Local 1445 United Food and Commercial Workers Union, NLRB, No. 01-RC-091163.

These organizations hope to prevent unions from “gerrymandering” arbitrarily small bargaining units in multi-department retail stores which, they argue, will lead to competitive, rather than collective, bargaining among multiple units in a single store and wreak havoc on the industries’ labor-management relations.

At the heart of the matter is the Board’s controversial 2011 ruling, Specialty Healthcare & Rehabilitation Center of Mobile, 357 NLRB No. 83 (2011), where the Board drastically altered its traditional “community-of-interest test” for determining the make-up of appropriate bargaining units and replaced it with a nebulous new standard that makes the certification of ever smaller (“micro”) units of employees possible, and more likely.

For decades, the Board held that where employees share a “community of interest” (similar wages, working conditions, skills, common management, frequent interchange, etc.) that the appropriate bargaining unit was a “wall-to-wall” unit of all the employer’s similarly-situated employees. In order to establish a “micro” sub-unit of employees, a party needed to show that the interests of the employees in the smaller unit were “sufficiently distinct” from those of other employees. 

Specialty Healthcare flipped that test on its head.

Under Specialty Healthcare, a presumptively appropriate bargaining unit is any “readily identifiable” group of employees who also share a community of interest. The burden is then on the employer to show that excluded employees share an “overwhelming community of interest” with the proposed unit and should be included. Needless to say, meeting this burden has proven nearly impossible for employers, causing the proliferation of smaller and smaller bargaining units in a variety of industries.

According to the amici, Specialty Healthcare not only overturned decades of Board precedent and defies the purpose of the National Labor Relations Act, but the enunciated standard is unworkable in the retail industry context. They argue that the “wall-to-wall” presumption derived from decades of Board precedent where it carefully analyzed “the realities of the retail business in all of its diverse forms, products, structures, sizes, and locations.” Thus, the groups argue, “it is now possible that with respect to [Macy’s], unions could seek dozens of separate units, one for each department. This could be repeated in thousands of other retail settings, resulting in a proliferation of separate bargaining units that would cripple a retail employer with endless multiple negotiations, conflicting union demands and contract obligations, and burdensome administrative duties.”

By granting these organizations permission to file amicus briefs, the Board–for now at least– is showing a willingness to consider these arguments in determining whether the Regional Director got it right in Macy’s and whether the Specialty Healthcare standard should apply to the retail industry as a whole.