Successor Employer Lawfully Converted Nurses to Supervisors When Setting Initial Terms: NLRB General Counsel’s Office | Practical Law

Successor Employer Lawfully Converted Nurses to Supervisors When Setting Initial Terms: NLRB General Counsel’s Office | Practical Law

The Office of the General Counsel of the National Labor Relations Board (NLRB) released an advice memorandum concluding that a successor employer did not violate the National Labor Relations Act (NLRA) when it converted registered nurses to supervisors when setting initial terms despite not collectively bargaining with the union that represented the nurses under the predecessor employer.

Successor Employer Lawfully Converted Nurses to Supervisors When Setting Initial Terms: NLRB General Counsel’s Office

by Practical Law Labor & Employment
Published on 31 Mar 2015 • USA (National/Federal)
The Office of the General Counsel of the National Labor Relations Board (NLRB) released an advice memorandum concluding that a successor employer did not violate the National Labor Relations Act (NLRA) when it converted registered nurses to supervisors when setting initial terms despite not collectively bargaining with the union that represented the nurses under the predecessor employer.
On March 6, 2015, the Division of Advice at the NLRB's Office of the General Counsel released an advice memorandum recommending that an NLRB regional office dismiss an unfair labor practice (ULP) charge against Blue Hills Health and Rehabilitation, LLC.
At a Massachusetts nursing facility operated by Kindred Healthcare , there were separate bargaining units of registered nurses (RNs) represented by Local 653 of the Teamsters and licensed practical nurses (LPNs) and certified nursing assistants (CNAs) represented by Local 1199 of the Service Employees International Union (SEIU 1199). The Teamsters engaged in collective bargaining with Kindred for their first collective bargaining agreement from early 2013 through October 2013, when Kindred informed the Teamsters that it would no longer operate the facility as of July 2014.
In March 2014, Kindred informed the Teamsters that Blue Hills had been awarded the contract to operate the facility starting July 1, 2014. In May 2014, Blue Hills representatives visited the facility and distributed information to employees suggesting that it would retain most of the Kindred personnel when it took over operations. Consistent with its practices at other facilities, Blue Hills planned to have RNs perform supervisory roles and distributed new RN job descriptions highlighting that RNs would, among other things, have independent authority to:
  • Discipline employees.
  • Prepare employee appraisals that affect pay increases and bonuses.
Later in May, a Teamsters representative met with a Blue Hills representative and demanded that Blue Hills recognize and bargain with the Teamsters about the RNs. Blue Hills declined the demand pointing out that the nurses would be hired as supervisory employees and there was no reason to bargain with the Teamsters about them. The Teamsters did not:
  • Object to Blue Hills' intent to hire the RNs as supervisors.
  • Demand effects bargaining on that issue.
Before Blue Hills took over operations, it recognized SEIU 1199 as the representative of the LPNs and CNAs and assumed the SEIU 1199 collective bargaining agreement terms for those employees. When Blue Hills took over the facility, it:
  • Assigned supervisory responsibilities to the RNs who were retained (as it similarly had done in its other facilities).
  • Declined to recognize the Teamsters as a representative of the now-supervisory RNs.
  • Conducted supervisor training for the RNs.
The Division of Advice noted that:
  • Under NLRB v. Burns International Security Services, Inc., an employer is a successor (required to continue the predecessor's bargaining obligations) if:
    • it continues the old employer's business in substantially the same way; and
    • most of its workforce was employed by the old employer.
    (406 U.S. 272, 279-81, 294-95 (1972).)
  • A successor can unilaterally set initial terms and conditions of employment under Burns, unless the employer is "perfectly clear" that it will retain all unit employees.
  • Under Spruce Up Corporation, the NLRB interprets the "perfectly clear" exception to the new employer's right to set initial employment terms and conditions applies when the new employer:
    • does not clearly announce that it plans to change the terms; or
    • misleads employees into believing that their terms of employment would not change.
    (209 N.L.R.B. 194, 195 (1974).)
  • Blue Hills recognized SEIU 1199 as the representative for the LPNs and CNAs.
  • The NLRB regional office that investigated this case found that the RNs were supervisors for Blue Hills under Section 2(11) of the NLRA (29 U.S.C. § 152 (11)).
The Division of Advice found that Blue Hills:
  • Was a Burns successor because:
    • it continued Kindred's business in substantially the same form; and
    • most of its workforce had been previously employed by Kindred.
  • Was not, under Spruce Up, a "perfectly clear" successor that would be required to bargain with the union before setting initial terms, since:
    • Blue Hills announced its intention to change the RNs' roles and employment terms before taking over operations; and
    • the Teamsters were aware of Blue Hills' planned changes and did not challenge them.
  • Lawfully modified the RNs' job responsibilities without bargaining, including by assigning supervisory tasks and responsibilities. Since it was not a "perfectly clear" successor, Blue Hills had the right to set these initial terms without violating Section 8(a)(1) and (5) of the NLRA.

Practical Implications

Advice memoranda are not binding precedent on the panel (Board) heading the judicial functions of the NLRB. However, this advice memorandum provides guidance to employers about how the General Counsel's office will evaluate charges concerning a successor setting employment terms without collectively bargaining with the union that represented its predecessor's employees.
The General Counsel's office noted that it has recently taken the position that the panel (Board) heading the NLRB's judicial functions should reconsider the holding of Spruce Up. In particular, the General Counsel would urge the Board not to require counsels for the NLRB General Counsel to prove that a putative "perfectly clear" successor engaged or failed to engage in any particular actions for it to inure heightened bargaining obligations and lose its rights under Burns to unilaterally set initial terms. This would seem to be call to replace Spruce Up's "perfectly clear successor" factors with an open-ended, unweighted "perfectly clear successor in the circumstances" test.