As everyone in the HR community knows, the Obama administration has spent the last several years reinterpreting established workplace regulations to aggressively advance the cause of workers’ rights. The administration has been on a tear of late with the apparent intent of leaving behind an unprecedented legacy of not just protecting but also expanding those rights.
One of its evident strategies is to continue an ongoing narrowing, through the courts, of the definition of “supervisor” not just for wage and hour purposes but also for union organizing purposes. Although the cases reinterpreting that definition are coming from the National Labor Relations Board (NLRB), the result will have broad implications across a variety of agencies and laws and within non-unionized employers as much as unionized employers.
Under Section 2(11) of the National Labor Relations Act,
The term "supervisor" means any individual having authority, in the interest of the employer, to hire, transfer, suspend, lay off, recall, promote, discharge, assign, reward, or discipline other employees, or responsibly to direct them, or to adjust their grievances, or effectively to recommend such action, if in connection with the foregoing the exercise of such authority is not of a merely routine or clerical nature, but requires the use of independent judgment.
Some relevant history:
The Supreme Court ruled on a 6th Circuit case in 2001 concerning nurses (NLRB v. Kentucky River Community Care, Inc. No. 99-1815 [2001]). The question was whether certain nurses should be classified as supervisors—and thus barred from unionizing—when they exercise supervisory “judgment” that is based on professional or technical training or experience. The NLRB ruled that they were not supervisors, and therefore could be unionized. The 6th Circuit (and the Supreme Court) disagreed, ruling that the NLRB definition of “independent judgement” was too restrictive in eliminating professional judgement in directing the activities of employees.
In 2006, in another case involving nurses (Oakwood Healthcare, Inc. Case 7–RC–22141), the Republican-dominated NLRB gave a narrow interpretation of the term “routine or clerical (in) nature,” which broadened the definition of supervisor thus making it more difficult to unionize nursing supervisors.
However, with the Democrats taking over the White House in 2009, the term “supervisor” was again narrowed. In G4S Regulated Security Solution 358 NLRB 160 (September 29, 2012), the question arose whether lieutenants of security guards should be considered managers or employees. An Administrative Law Judge (ALJ), citing substantial evidence, ruled that the lieutenants were supervisors, but the NLRB overruled the ALJ, ruling that the lieutenants were employees and could thus be organized by the union.
The definition of supervisor was narrowed even further in late 2015 by the NLRB in two cases concerning tugboat captains (Cook Inlet Tug & Barge, Inc., 362 NLRB No. 111 (2015) and Buchanan Marine, L.P., 363 NLRB No. 58 (2015)). In these cases, the NLRB ruled that the captains did not responsibly direct employees because they were not accountable for actions of those that reported to them. The NLRB ruled that although a supervisor who designates work hours may possess assignment authority, he does not possess true supervisory authority if management sets and controls changes to the schedule.
As these and other cases indicate, by using a narrow interpretation of what a supervisor does and whether he or she uses independent judgement, the NLRB has made it more difficult for employers to designate employees as true supervisors. Thus the NLRB has increased the number of employees who can organize and conceivably be non-exempt under the Fair Labor Standards Act (FLSA).
The continued narrowing of the definition of “supervisor” by the NLRB will have crossover impact on the FLSA definition of the term, likely changing many employees in such positions from exempt to non-exempt. Potentially taking it a step further, EEO-1 filings from federal contractors, and even the individuals who report such employees as exempt, could become targets for prosecution under the False Claims Act.
Given the fact that we are now in the last year of a White House administration intent on creating a legacy of dramatically liberalized labor and employment law, HR should not be surprised to see a continued narrowing of the definition of supervisor in the coming months. Regardless of whether you are a union or non-union employer, now is the time to take a step back and review, yet again, your organization’s practice in determining who is and who is not a supervisor. And be sure to do it with the help of legal counsel.
Source: Hunton & Williams LLP 1/12/16, Congressional Research Services, The Definition of “Supervisor” Under the National Labor Relations Act (July 5, 2012), Practical Law 6/30/15