Employment Law Daily Application of Specialty Healthcare upheld; dockworkers did not share overwhelming community of interest with drivers
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Wednesday, March 9, 2016

Application of Specialty Healthcare upheld; dockworkers did not share overwhelming community of interest with drivers

By Kathleen Kapusta, J.D. The overwhelming community of interest standard articulated by the NLRB in Specialty Healthcare is not a material departure from past precedent and is consistent with the requirements of NLRA Section 9(b), ruled the Eighth Circuit. The Specialty Healthcare framework is a reasonable interpretation of how the Board should apply section 9(b) and decide on an appropriate unit, and is therefore an interpretation to which it must defer, said the court. After approving the standard, the court found that FedEx did not meet its burden to show that dockworkers at two of its terminals shared an overwhelming community of interest with city and road drivers so as to require their inclusion in the same unit. Accordingly, it denied FedEx’s petition for review of the Board’s order forcing it to bargain with the unions and granted the Board’s petitions for enforcement (FedEx Freight, Inc. v. NLRB, March 7, 2016, Murphy, D.). Two Teamsters locals petitioned the Board seeking to represent bargaining units including city and road drivers working at two FedEx Freight terminals, but FedEx proposed that the units should also include the dockworkers at the terminals. Applying Specialty Healthcare’s two step analysis, an NLRB Regional Director found that the union's proposed bargaining unit was composed of a readily identifiable group of employees sharing a community of interest, and FedEx failed to show the dockworkers shared an "overwhelming community of interest" with the drivers that required their inclusion in the same unit. The Board denied review, and the Teamsters won both elections. Petitioning for review, FedEx argued that Specialty Healthcare’s standard violates the NLRA, Eighth Circuit precedent, and the Administrative Procedure Act. Drivers and dockworkers. Both terminals employed city drivers, road drivers, and dockworkers. All of the drivers were employed full time, had commercial drivers’ licenses, and wore uniforms. City drivers picked up and delivered freight to and from customers in the area while road drivers transported freight between the terminal and other FedEx facilities. Dockworkers loaded and unloaded freight and used forklifts. While some of the drivers performed some dock work, dockworkers did not do any driving. Not all dockworkers were full time but full-time dockworkers could participate in a “dock to driver” program in which they work full time on the dock while taking a course to obtain their commercial drivers’ license. In finding that Specialty Healthcare comports with Section 9(b) and its cases interpreting the NLRA, the appeals court pointed out that in the first step of the two-step analysis, the Board evaluates whether employees in the proposed unit are "readily identifiable as a group" and "share a community of interest." The Board applies the “traditional criteria” for determining whether employees share a community of interest, observed the court, noting that it also list a number of factors it uses to determine whether a community of interest exists, all of which parallel the court’s previous description of the community of interest test. Thus, the court found that the Specialty Healthcare framework begins by applying the test it has approved. While FedEx contended that Specialty Healthcare is a departure from precedent because it examines the proposed unit in isolation, the court pointed out that the community of interest test does in fact compare the interests and characteristics of the workers in the proposed unit with those of other workers as the factors listed by the Board question whether the employees in the proposed unit have characteristics that are “distinct” and “separate” and compare the employees to “other employees.” An appropriate unit. Rejecting FedEx’s suggestion that the Board must consider other possible units before determining whether the union’s proposed unit is appropriate, the court noted that nothing in the Act prohibits the Board from focusing its analysis on the proposed unit. “In our circuit it is a ‘longstanding principle’ of unit determination under the community of interest test that ‘the Board need only certify ‘an appropriate’ bargaining unit, rather than 'the most appropriate' one,’” said the court. Thus, it continued, the first step in the Specialty Healthcare analysis is not a departure from the Board's precedent and is consistent with the requirements of Section 9(b). As to the contention that the "overwhelming community of interest" standard applied in the second step of the analysis was a departure from precedent, the court noted that the Board has repeatedly required a heightened showing to challenge a proposed unit found appropriate under the community of interest test. Moreover, courts have also imposed a heightened standard on parties seeking to show that a group of employees was improperly excluded from a bargaining unit, said the appeals court. To the Eighth Circuit, the most instructive is the D.C. Circuit’s “truly inappropriate” standard enunciated in Blue Man Vegas, LLC v. NLRB, which was decided three years before Specialty Healthcare, and which closely resembles its own “totally inappropriate” requirement. Union organizing. The court also disagreed with FedEx’s contention that the standard violates Section 9(c)(5), which states that when the Board is determining an appropriate bargaining unit, "the extent to which the employees have organized shall not be controlling," noting that the Supreme Court has stated that the extent of organization may be considered by the Board as one factor in its determination, so long as it is not given controlling weight. While FedEx argued that the Specialty Healthcare framework was foreclosed by NLRB v. Lundy Packing Co., in which the Fourth Circuit rejected the Board's use of a version of the overwhelming community of interest test, the court pointed out that Lundy did not hold that any heightened standard violates Section 9(c)(5), and four years after Lundy the Fourth Circuit reiterated that an employer challenging a bargaining unit selected by the Board must show that the unit is "utterly inappropriate." Noting that courts have demonstrated a willingness to reject bargaining units that are inappropriate, the court found that the framework does not make the extent of union organization controlling. Finally, substantial evidence supported the Board's unit determinations under the Specialty Healthcare standard. Keeping in mind the Board's discretion and its deferential standard of review, the court found that several common sense logical distinctions separated the drivers and the dockworkers. Most importantly, the drivers and dockworkers were hired to do substantially different jobs. In addition, drivers were required to have a commercial driver license; the qualifications to become a dockworker were minimal; and although drivers occasionally worked on the dock, their primarily transported freight between the distribution centers and other centers or customers. Moreover, drivers were all full time employees, whereas dockworkers were not. Although the drivers in one terminal performed about one third of the dock work, to the court, the more important fact was that dockworkers could not and did not perform driving work for FedEx. These differences, said the court, supported the Board's determination that the dockworkers did not share an overwhelming community of interest with the drivers.

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