North Carolina Law Review

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Toward the “Fullest Freedom”: Defining Section 7 Stakeholders in NLRB Unit Determinations

February 5, 2019

97 N.C. L. Rev. 464 (2019)


In the United States, organized labor is a shell of its former self. Unions currently represent only 10.7% of American workers, compared to roughly 33% in the 1950s. In the private sector, only 6.5% of workers are union members. Yet, despite the lack of union membership in the American workforce, 60% of Americans view labor unions favorably. The steady decline of organized labor is due to many economic and industrial factors beyond the scope of this Recent Development. Nonetheless, an awareness of the vitality of organized labor provides a useful context to any discussion involving the National Labor Relations Board (“NLRB” or “the Board”). This context is important because the policies and rulings of the NLRB, the agency tasked with enforcing the National Labor Relations Act (“NLRA” or “the Act”), play a significant role in the existence of organized labor and unions. With organized labor in decline, there should be an increased focus on how the NLRB enforces the provisions of the NLRA.

 

Among its many responsibilities, the NLRB conducts elections in which employees vote whether to certify a union as their bargaining representative. Union elections are an integral part of the unionization process and heavily depend on the NLRB’s policies. As important as elections can be, the makeup of the voting unit largely determines the outcome. In order to vote in a union election, an employee must have a job that is within an approved unit of workers. Typically, a unit is formed as follows: A union organizer begins to build support among employees in a workplace to seek union representation. The union organizer often targets a subset of the workforce to build initial support for union representation. Though not all employees in the subset may support union representation, the union will proceed toward an election when it determines that a majority of the employees in a unit want the union to represent them in collective bargaining .If the union and the employer cannot agree on the size of the unit that will hold an election, the union must petition the NLRB to approve the unit.  When there is a union petition, the employer will usually contend that the unit should not be approved for an election.

 

When petitioning the NLRB, the union usually proposes small bargaining units because it is easier to build majority support for a union among fewer, more similarly situated employees. In contrast, the employer traditionally argues for larger units so that it can bargain with a greater number of employees, and because a larger unit is less likely to produce a consensus for unionization. Because both the union and the employer know that the size of the unit can determine the outcome of an election, unit determination is a heavily litigated and contentious issue. In such cases, the employees or an organization acting on their behalf files the petition, and the NLRB must decide whether the proposed unit is appropriate for collective bargaining.

 

The NLRB’s authority to determine whether a unit is appropriate comes from the NLRA. Section 9(b) of the Act provides that “[t]he Board shall decide in each case whether, in order to assure to employees the fullest freedom in exercising the rights guaranteed by this [Act], the unit appropriate for the purposes of collective bargaining shall be the employer unit, craft unit, plant unit, or subdivision thereof.” The “rights” referred to in section 9(b) are found in section 7 and include the right to self-organize, to join labor organizations, to bargain collectively through representatives, and to engage in other concerted activities for mutual aid or protection, as well as the right to refrain from any or all of such activities.

 

The NLRB’s standard to determine whether a petitioned-for unit is appropriate has recently changed on two occasions. In 2011, the NLRB reformulated old standards to develop the “overwhelming community-of-interest” test in Specialty Healthcare and Rehabilitation Center of Mobile. In 2017, the NLRB overturned Specialty Healthcare when it returned to the “community-of-interest” test in PCC Structurals, Inc.

 

With the NLRB changing its standard twice in just six years, three observations can be made. First, the change from the Specialty Healthcare standard to the PCC Structurals standard may appear subtle, but its consequences are enormous. PCC Structurals is undoubtedly a pro-employer standard because it abandons the Specialty Healthcare deference given to petitioned-for units. Second, both the overwhelming community-of-interest test and the community-of-interest test adhere to the principles of section 9 of the NLRA. In other words, both tests are legally permissible. Third, the most complete way to differentiate the two tests is to analyze which test “assure[s] to employees the fullest freedom in exercising the rights guaranteed by [the Act],” pursuant to the section 9(b) mandate of the NLRA.

 

This Recent Development explores a third observation—that the best method for deciding which test the NLRB should follow is to compare how they assure to employees their “fullest freedom” under the NLRA. If the NLRB must decide whether a petitioned-for unit is “appropriate” pursuant to section 9(b) in order to assure to employees the fullest freedom in exercising the rights guaranteed by the Act, then the “freedom” given to employees in section 7 deserve a workable framework. Analyzing the effects on employee freedom in unit determination is especially important considering that unit determination cases create tension between employees and the rights they want to exercise. In short, this Recent Development thoroughly analyzes how a section 9(b) standard affects the freedom of employees, something the NLRB failed to do in PCC Structurals.

 

This Recent Development proposes a hierarchy of “Section 7 Stakeholders” as a framework in deciding which test—Specialty Healthcare’s overwhelming community-of-interest standard or PCC Structurals’s community-of-interest standard—better fulfills the goals of the NLRA. It will proceed in three parts. Part I provides a more thorough background of PCC Structurals and the history of the section 9(b) standards the NLRB has used. Part II proposes a hierarchy of Section 7 Stakeholders and explains why such a framework is necessary for the NLRB to fulfill its section 9(b) duty of determining whether a unit is appropriate for collective bargaining. Part III then explores how the framework should be used to compare the two standards.

 

 

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