NLRB Gives Retail Store Bargaining Units a Makeover

July 29, 2014
Legal update

The National Labor Relations Board gave retail store bargaining units a makeover in last week's Macy's decision. The NLRB affirmed its 2011 Specialty Healthcare decision, in which it empowered unions to select any "readily identifiable" group for purposes of starting a union. In affirming that decision, the NLRB expanded the application of micro-units to the retail store setting.

The Saugus, Massachusetts Macy's cosmetic and fragrance employees petitioned for an election of the departmental unit of cosmetics and fragrances employees, including counter managers. Macy's cosmetic and fragrance sales department is located in a distinct section of the store, and its employees only sell the cosmetic and fragrance products supplied by specialty vendors. These employees have a different compensation structure and report to a different manager than other Macy's sales employees. The NLRB affirmed the Acting Regional Director's determination that the petitioned-for departmental unit was appropriate.

In Specialty Healthcare, the NLRB authorized the organizing of micro-units in a non-acute healthcare facility and permitted unions to exclude other employees unless they share an "overwhelming community of interest." The Macy's decision is significant because it expands the application of micro-units to the retail industry. In Macy's, the NLRB determined that "the Employer has failed to establish that the petitioned-for employees share an overwhelming community of interest with the other selling employees. Due to the fact that the petitioned-for employees work in a separate department under separate supervision, have only limited interchange and contact with other selling employees, have distinct work areas, and work in a differently-structured department, it simply cannot be said that their community of interest factors 'overlap almost completely' with those of the other selling employees."

This decision serves as a reminder to employers to be vigilant about timely addressing the needs and concerns of employees or else face a union continuing this micro-unit trend with a subset of workers in their facility. As the use of micro-unit elections expands, Employers should reevaluate their union risk and avoidance strategies and be prepared to address micro-unit organizing in the future. 

To view FBT's prior client advisory regarding Specialty Healthcare, click here: NLRB Creates New Organizing Opportunities for Unions. If you have any questions, please contact any member of Frost Brown Todd's Labor and Employment Practice Group.