New Management Opportunities and The Kentucky River Case. (Unions).

IN THIS ARTICLE...

Physicians and other health care workers seeking to unionize may face an uphill battle as a result of a recent decision by the U.S Supreme Court that essentially defines nurses and physicians as supervisory personnel who can't engage in collective bargaining. Discover what led to the decision and how it affects health care.

A SIGNIFICANT CHANGE rocked private sector health care last spring and employers are just now beginning to realize its impact.

In May, the U.S. Supreme Court handed down a decision that essentially says most, if not all, nurses and physicians in the private sector are supervisory personnel and cannot be members of unions.

The case, National Labor Relations Board v. Kentucky River Community Care, Inc., potentially affects other organized professional groups beyond the health care industry - such as engineers in aerospace and automotive industries.

Repercussions for professional employees include loss of protection under labor laws and the decision may force health care workers' unions to reexamine aggressive organizing plans.

Yet, the case also presents opportunities for employers to restore greater balance over labor matters in times of increasingly tight labor markets for skilled personnel, particularly nurses.

How the case unfolded

Kentucky River Community Care, Inc. operates the Caney Creek Developmental Complex, a facility in Pippa Passes, Ky., employing about 110 professional and non-professional employees to care for people who suffer from mental retardation and mental illness.

In 1997, the Kentucky State District Council of Carpenters petitioned the National Labor Relations Board to represent all 110 employees. The employer objected claiming that, under the National Labor Relations Act, the six registered nurses employed at Caney Creek were supervisors and not eligible to be included in a collective bargaining unit.

The employer said two of the RNs served as building supervisors, although they had no keys to the facilities and received no extra compensation for such responsibility. The only additional responsibility they shouldered as supervisors was contacting other employees if a shift was not fully staffed.

The RNs had no authority to order an employee to stay on duty or come to work to fill a vacancy. While they occasionally requested other employees to perform routine tasks, they had no authority to take any action if the employee refused.

They couldn't hire, fire, reward, promote or independently discipline employees. They did not evaluate employees or take any action affecting their employment status.

The NLRB determined that the nurses should be in the bargaining unit and denied the employer's request for additional review. The union vote went on as planned and the union won the election.

Kentucky River refused to bargain with the union and the union filed an unfair labor practice complaint against them. The NLRB granted summary judgment in favor of the union.

The U.S. 6th Circuit Court of Appeals reversed the decision, ruling in favor of Kentucky River. And NLRB took it on to the U.S. Supreme Court.

Supreme ruling

In a 5 to 4 decision, the high court ruled in favor of the employer and against the NLRB and the union. The nurses were supervisors.

The court grappled with a tension in the Labor Relations Act that excludes supervisory personnel from unions but includes professionals such as professional health care workers.

The conflict emerges if a nurse or physician instructs a fellow employee, such as a patient care technician, to perform a task. Are they acting as a professional who, according to Congress, is eligible to unionize? Or are they a supervisor who is not?

The majority of justices reasoned that the policy of the NLRB was inconsistent with the Labor Relations Act.

For years, NLRB reasoned that ordinary professional or technical judgment by professionals directing less skilled employees is not independent judgment and is not a supervisory function.

But the Supreme Court looked at the act's three-part test for determining whether an employee is a supervisor. Employees are supervisors if:

1. They hold the authority to hire, transfer, suspend, layoff, recall, promote, discharge, assign, reward, discipline, responsibly direct or adjust grievances

2. Their exercise of authority is not merely routine or clerical, but requires independent judgment

3. Their authority is held in the interest of their employer

In the Kentucky River case, NLRB claimed part two was not met. They said nurses did not exercise independent judgment in their interactions with other employees.

The majority of justices rejected that argument. Justice Antonin Scalia dismissed the NLRB's attempt to deal with the tension in the Labor Relations Act by asking: "What supervisory judgment worth exercising, one must wonder, does not rest on professional or technical skill or experience?"

The NLRB also argued that in its interpretation of the act it was essential to include professional employees. The board said many professional employees customarily give judgment-based direction to less skilled employees, including lawyers, doctors and nurses.

The high court found that such policy had no basis in the act and was, in essence, a distortion of statutory language.

Scalia offered one extremely narrow avenue for the NLRB to allow certain professionals to be protected.

"Perhaps the board could offer a limiting interpretation of the supervisory function of responsible direction by distinguishing employees who direct the manner of others performance of discrete tasks from employees who direct other employees," he said.

That's of little use to health care professionals or professionals from other industries, such as engineers.

For example, in a hospital, nurses direct patient care technicians with increasing frequency and doctors consistently direct both nurses and technicians. Essentially, a physician-employee who instructs another employee on how to perform a task, such as inserting an intravenous line into a patient, might not be a supervisor.

But a physician-employee who writes an order in a patient's chart to start an IV running normal saline at 60 cc per hour would without a doubt be a supervisor. Physicians rarely, if ever, start an IV, but quite regularly write the order.

Meanwhile, the nursing shortage has pushed hospitals to hire greater numbers of less expensive patient care technicians who are regularly supervised by the nurses.

Both nurses unions and physicians unions greeted the Kentucky River decision with dismay. However, it is the law of the land and will remain so unless there is a significant change in the constituency of the Supreme Court or an amendment to the Labor Relations Act by Congress.

Both are highly unlikely.

The decision makes the unions' tasks far more difficult by allowing employers to contest the supervisory status of each professional employee in hearings before the NLRB. That can greatly slow the process and increase costs of litigation to the labor organizations.

Management also can take proactive measures:

* Job descriptions of employees can be redrafted to make supervisory duties explicit.

* Nurses can be required to direct the activities of patient care technicians. The duties of the registered nurse supervisors at the Caney Creek facility did not vary much from other employees, suggesting that the high court sees a very low threshold for determining supervisory status.

* Management can also provide genuine evidence of supervisory activities by including such personnel in the supervisory process. Nurses can be included on a regular or rotating basis on committees charged with determining certain small financial rewards of other employees for exemplary service.

In the end, many creative approaches can be developed in conjunction with legal counsel using the decision of Kentucky River to enable management to regain greater authority over the market for health care labor.