'Micro Unionization' Riles Retailer Bergdorf Goodman, Others

By Angelo Young | June 19 2012 6:39 AM

Here's what a nursing home in Mobile, Ala., has in common with the regal Bergdorf Goodman department store in Manhattan: They're both facing micro-unions, groups of employees who organize apart from the rest of a company's workforce.

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Women's shoe sales clerks at Bergdorf Goodman in Manhattan are facing a challenge by their employer, Dallas-based Neiman Marcus Group Inc., to their successful bid to be represented by a local labor union representing retail workers. Critics call recent moves to form so called "micro unions" a threat to businesses and job growth while proponents say employees should have a right to collective bargaining even if coworkers in other job categories at the same company prefer no union representation.

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Last month the National Labor Relations Board ruled that employees of the women's shoe department in the company's iconic store on Manhattan's tony Fifth Avenue may be represented by Local 1102, the Westbury, N.Y.-based affiliate of the United Food and Commercial Workers Union.

Dallas-based Neiman Marcus Group Inc., which owns Bergdorf Goodman, is appealing the NLRB decision and major trade associations are supporting Neiman Marcus. If the appeal to the NLRB fails, Neiman Marcus can pursue its claims in civil court.

This case is a result of a government agency run amok, National Retail Federation President and CEO Matthew R. Shay said in a statement after the alliance joined other business advocacy groups in supporting Neiman Marcus's appeal. Over the past three years, the NLRB has steamrolled over long-settled precedent and procedures in an overt effort to empower big labor over the objections of retailers and the broader business community.

On Thursday, the Senate Appropriations Committee narrowly failed in a 15-15 vote to include an amendment to its labor-related markup sponsored by Sen. Lindsay Graham, R.-S.C., to prohibit the use of funds to implement, create, apply or enforce decisions related to micro-unions by the National Labor Relations Board. The senator has said he is optimistic that the amendment would be reintroduced when the full Senate begins wrangling with the 2013 discretionary budget.

Had the vote passed, it would have opened the way for blocking the formation of what Graham, Sen. Richard Shelby, R-Ala., and other employer-side advocates call gerrymandered unions that create internal discord and kill jobs. Members of the Appropriations Committee who opposed Graham's amendment included Sens. Tom Harkin, D-Iowa, and Mary Landrieu, D-La.

Union supporters say workers inside a company have differing interests, wages, benefits and duties, and that it is the place of the NRLB -- not a federal or state legislature -- to determine if workers fit a so-called appropriate negotiating unit inside a company.

This should not be legislated because this is really something the NLRB needs to examine on a case-by-case basis, said Maria Somma of the United Steelworkers. For the legislature to impose sweeping rules like this would absolutely limit employees from unionizing. It's a ridiculous stance, especially in today's economy.

The recent spat over micro-unions didn't start in any organized labor stronghold in the country; on the contrary, the case that kicked off the controversy emerged from a nursing home in Mobile, Ala.

In August, the NLRB ruled that about 50 registered nursing assistants working for Specialty Healthcare constituted an appropriate negotiating unit of workers inside the company. The NLRB said registered nursing assistants were different enough from housekeeping staff and administrators in the center to be qualified for union representation as health care workers. Today those registered nursing assistants are represented by the United Steelworkers.

Since that ruling, the NLRB has ruled in favor of micro-unions at other companies, including maintenance workers at a Nestlé SA Dreyer's ice cream plant in California and car rental employees of Dollar Thrifty Automotive Group Inc. (NYSE: DTG) in Las Vegas.

Now Bergdorf Goodman has become the latest to grapple with this contentious issue. According to Somma, the NLRB is the agency most able to review the merits of each case.

It might be that the shoe sales clerks have different duties than other employees at the store, they might have different supervisors, there might be other factors involved, she said. It's really up to the board to decide these issues.

On Friday, in support of Neiman Marcus, the NRF and other business groups filed a brief with the NLRB arguing that the retail sales clerks fit into the same category as all sales clerks in a retail operation, and therefore do not constitute a separate so-called community of interest -- the term used to determine if a group of employees have shared interests and duties -- that are distinct from other Bergdorf Goodman floor-sales representatives.