6th Circuit Affirms NLRB, Requires 'Overwhelming Community Of Interest' To Challenge Bargaining Units

Executive Summary: The Sixth Circuit Court of Appeals has affirmed the decision of the National Labor Relations Board (NLRB) in Specialty Healthcare, which requires employers to prove employees share an "overwhelming community of interest" to successfully challenge the composition of a bargaining unit. The court held that: (1) the Board may depart from its own precedent if it explains its decision and the departure is not arbitrary and capricious; (2) the Board's clarification and use of its "overwhelming community-of-interest" standard was clearly explained and therefore not an abuse of its discretion: (3) the Board did not violate the National Labor Relations Act (the Act) because it based its decision on factors beyond the extent of the union's organization efforts; and (4) the Board did not abuse its discretion by choosing to follow an already existing principle through adjudication instead of rulemaking. See Kindred Nursing Centers East v. NLRB (Aug. 15, 2013).

Background: In Specialty Healthcare, the Board upheld the Regional Director's bargaining unit determination. In doing so, the Board: (1) overruled Park Manor Care Center, (2) returned to applying the "traditional community-of-interest approach" to nursing homes, and (3) "reiterated and clarified" that a challenger must show excluded employees share an "overwhelming community of interest" with included employees to successfully challenge the makeup of a bargaining unit.

The Sixth Circuit's Decision

Court Deference to Board Decisions

In upholding the Board's decision in Specialty Healthcare, the Sixth Circuit explained that courts must uphold the Board's bargaining unit determinations unless a decision is shown to be arbitrary, unreasonable, or an abuse of discretion. The court also noted that the Board is allowed wide discretion in determining the makeup of an appropriate bargaining unit, and in such matters this discretion borders on finality. If the Board's actions are reasonably defensible and clearly explained, the Board decision must be upheld. Further, courts give considerable deference to an agency's interpretation of its own precedents, and review is limited to whether the stated rationale is rationally justified or so unreasonable as to be arbitrary and capricious.

Appropriate Bargaining Units

The court then rejected the employer's argument that the Board adopted a new approach in Specialty Healthcare and did not return to the traditional community-of-interest...