Macy's obtains strong dissent from denial of rehearing in micro-union case

Client(s) Macy's Inc.

In a strong rebuke to the National Labor Relations Board ("NLRB" or the "Board"), six judges dissented from the denial of a petition for rehearing en banc filed by Jones Day on behalf of Macy's, Inc. in the U.S. Court of Appeals for the Fifth Circuit. At issue was the NLRB's decision to approve a unit consisting of a single department—the cosmetics and fragrances department—at a single Macy's store. Judge Jolly, writing for the dissenters, explained that in approving the requested unit, the National Labor Relations Board had erred by failing to explain the legal significance of factual distinctions between included and excluded employees. According to the dissenters, this failure to properly apply the first prong of the test set forth in Specialty Healthcare & Rehabilitation Center of Mobile, 357 N.L.R.B. 934 (2011), was yet "another example of the current National Labor Relations Board's . . . determination to disregard established principles of labor law."

This dissent should encourage employers concerned that the Board's Specialty Healthcare standard creates a virtually irrebuttable presumption in favor of the union's choice of bargaining unit. The Board is now on notice that its unit determinations may not be enforced if—at step one of the Specialty Healthcare analysis—it does not adequately explain both the community of interest shared by petitioned-for employees and why those interests are sufficiently distinct from those of excluded employees. Employers facing petitions for units excluding similarly situated employees now have a stronger basis to contest a finding that the unit is appropriate if the Regional Director does not offer a thorough analysis that explains the legal significance of any factual distinctions it identifies.

Macy's Inc. v. Nat'l Labor Relations Bd., No. 15-60022 (5th Cir.)