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The National Labor Relations Board recently issued a leading case setting forth new guidelines for determining whether an individual is a supervisor under the National Labor Relations Act (NLRA). In a 3-2 decision, the board held that permanent charge nurses of an acute care hospital exercised supervisory authority in assigning employees within the meaning of � 2(11) of the NLRA. Oakwood Healthcare Inc., 348 NLRB No. 37 (Sept. 29, 2006). Section 2(11) defines “supervisor” as any individual having the 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 merely routine or clerical nature, but requires the use of independent judgment. Pursuant to this definition, individuals are statutory supervisors if they hold the authority to engage in any one of the 12 supervisory functions (e.g., “assign” and “responsibly to direct”) listed in � 2(11); their “exercise of such authority is not of a merely routine or clerical nature, but requires the use of independent judgment”; and their authority is held “in the interest of the employer.” NLRB v. Kentucky River Community Care, 532 U.S. 706, 713 (2001). Supervisory status may be shown if the putative supervisor has the authority either to perform a supervisory function or to effectively recommend the same. The burden to prove supervisory authority is on the party asserting it. Id. at 711-712. Cases offer guidance to construe supervisory status The board has historically exercised caution “not to construe supervisory status too broadly because the employee who is deemed a supervisor is denied rights which the Act is intended to protect.” Chevron Shipping Co., 317 NLRB 379, 381 (1995). However, in applying that principle, the board has, according to the Supreme Court, occasionally reached too far. On two occasions involving the health care industry, the Supreme Court rejected what it viewed as the board’s overly narrow construction of � 2(11) as “inconsistent with the Act.” Kentucky River, 532 U.S. at 721-722 (holding that the board erred in finding no “independent judgment” when nurses use ordinary professional or technical judgment in directing less-skilled employees); NLRB v. Healthcare & Retirement Corp., 511 U.S. 571 (1994). As a result, the board in Oakwood Healthcare re-examined and clarified its interpretation of the term “independent judgment,” as well as the terms “assign” and “responsibly to direct,” as these terms are set forth in � 2(11). The board defined “assign” as the act of designating an employee to a place (such as a location, department or wing); appointing an individual to a time (such as a shift or overtime period); or giving significant overall duties (i.e., tasks) to an employee. But the board found that choosing the order in which an employee will perform discrete tasks within those assignments would not be indicative of excising the authority to “assign.” In sum, “assign” under the act “refers to the designation of significant overall duties to an employee, not to the . . . ad hoc instruction that the employee perform a discrete task.” The board found that the employer established that certain charge nurses assigned nursing personnel to patients. At the beginning of each shift, and as new patients were admitted thereafter, the charge nurses for virtually every patient unit assigned the staff to the patient for whom they would care over the duration of the shift, and as to the emergency room, the charge nurses assigned employees to geographic areas within the emergency room. The charge nurses’ assignments determined the required work for employees during the shift. The board then defined the statutory term “responsibly to direct” and stated that it involved a finding of accountability, so that “it must be shown that the employer delegated to the putative supervisor the authority to direct the work and the authority to take corrective action, if necessary,” and also that “there is a prospect of adverse consequences for the putative supervisor,” arising from his or her direction of other employees. The board found that the employer failed to establish that its charge nurses possessed the authority to responsibly direct employees. It found that the direction the nurses exercised was insufficient to constitute “responsible direction” because the nurses were not held accountable for the performance of their tasks, nor did they have authority to correct any errors made. This finding was not fatal to an ultimate finding of supervisory status, since only one of the 12 � 2(11) functions needs to be found. Finally, the board adopted an interpretation of the term “independent judgment” that applies irrespective of the � 2(11) supervisory functions implicated, and without regard to whether the judgment is exercised using professional or technical expertise. First, to be “independent,” the judgment exercised must not be effectively controlled by another authority. Thus, when a judgment is dictated or controlled by detailed information or regulations, the judgment would not be found sufficiently “independent.” Second, judgment refers to the mental process of forming an opinion or evaluation by discerning and comparing data. Further, the degree of discretion exercised must rise above the “routine or clerical” to constitute “independent judgment” within the statutory definition. The board found that the charge nurses used independent judgment in assigning work because these staffing assignments were “tailored to patient conditions and needs and particular nursing skills sets,” and were based upon the charge nurses’ own assessment of the probable amount of nursing care each patient would require during the shift. In dissent, members Wilma B. Liebman and Dennis P. Walsh disagreed with the majority’s definitions and further disagreed with its finding that the charge nurses exercised supervisory authority in “assigning” other employees. The dissent contended that the majority erred in defining “assign” to include the act of assigning overall tasks to employees. Accordingly, the dissent would limit the definition of “assign” to include only the act of determining “an employee’s position with the employer,” “an employee’s designated work site” or “an employee’s work hours.” The dissent also disagreed with the majority’s definition of “responsibly to direct,” contending that the phrase should include only “persons who were effectively in charge of a department-level work unit.” As a result the dissent would require the following showing: The putative supervisor has been delegated substantial authority to ensure that a work unit achieves management objectives and is thus “in charge”; he or she is held accountable for the work of others; and he or she exercises significant discretion judgment directing his or her work unit. The board applied its Oakwood test for supervisory status in two other decisions. In Golden Crest Healthcare, 348 NLRB No. 39 (Sept. 29, 2006), a three-member board panel unanimously found that the charge nurses at a nursing home did not exercise supervisory authority under the act. It found the charge nurses lacked the ability to assign other employees because the employer failed to establish that the charge nurses possessed the authority to require other employees to stay past the end of their shifts, to come in from off-duty status or to shift section assignments. Although the board found that the nurses directed the work of other employees, it nevertheless concluded that they lacked the authority to responsibly direct other employees because the employer failed to establish that they were actually held accountable for the job performance of other employees. Similarly, the board in Croft Metals Inc., 348 NLRB No. 38 (Sept. 29, 2006), found that the “lead persons” at a manufacturing facility were not supervisors. After finding that they did not possess the authority to “assign,” the board found that the leads did responsibly direct their line or crew members because they were required to manage their assigned teams, correct improper performance, shift employees and decide the order in which work was performed in order to achieve production goals. They were also held accountable for the performance of their crew or line members. Yet the board found that the employer did not meet its burden to establish that the leads exercised independent judgment in directing their crew or line members: Their exercise of judgment was either fundamentally controlled by pre-established guidelines or was simply routine. New standard provides clarity for future disputes Oakwood is perhaps the Bush board’s most significant decision because supervisory status is critical in many labor relations contexts. This decision appears to have been carefully drafted to address concerns frequently expressed by the Supreme Court and many circuits, and it eschews the results-oriented approach favored by the dissent and often criticized by the courts. While the employer actually lost two of the three cases decided by the board under its new standard, the clarity of the opinion should help practitioners on both sides of the issue better assess the viability of their position, as well as better advocate their positions on the issue of supervisory status. Practitioners seeking to prove supervisory status must still be prepared to establish “independent judgment,” now fully defined, and link the putative supervisor’s exercise of independent judgment to any of the enumerated functions listed in � 2(11); “responsible direction,” by showing that the employer holds the putative supervisor accountable for the performance of the work of the employees he or she directs; and “assign” responsibilities, by showing the designation of significant overall duties, work location and work time, and not by merely presenting ad hoc instructions that employees perform discrete tasks. Kenneth R. Dolin is a partner in the labor and employment practice group of Chicago’s Seyfarth Shaw.

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