N.L.R.B. v. GranCare, Inc.

Citation170 F.3d 662
Decision Date03 March 1999
Docket NumberNo. 1444,I,No. 97-3431,1444,97-3431
Parties160 L.R.R.M. (BNA) 2661 NATIONAL LABOR RELATIONS BOARD, Petitioner, and United Food and Commercial Workers, Localntervening Petitioner, v. GRANCARE, INC., d/b/a Audubon Health Care Center, Respondent.
CourtUnited States Courts of Appeals. United States Court of Appeals (7th Circuit)

John D. Burgoyne, John Arbab (argued), National Labor Relations Board, Appellate Court, Enforcement Litigation, Washington, DC, for Petitioner.

Christopher J. Johnson (argued), Beck, Chaet, Loomis, Molony & Bamberger, Milwaukee, WI, for Respondent.

Scott D. Soldon, Naomi E. Soldon (argued), Previant, Goldberg, Uelmen, Gratz, Miller & Bruegeman, Milwaukee, WI, for Intervenor-Petitioner.

Before POSNER, Chief Judge, and COFFEY, FLAUM, EASTERBROOK, RIPPLE, MANION, KANNE, ROVNER, DIANE P. WOOD, and EVANS, Circuit Judges. 1

TERENCE T. EVANS, Circuit Judge.

The line that separates employees who can unionize from supervisors who can't is not always clear. This is particularly true for nurses in the health care field, whose duties and lines of responsibility can sometimes be fuzzy. Our case today concerns licensed practical nurses (LPNs) at a nursing home in Wisconsin. Are they just employees of the home or are they supervisors as that term is defined by the National Labor Relations Act (NLRA), 29 U.S.C. § 152(11)?

GranCare, Inc. operates a 282-bed nursing home in Bayside, Wisconsin, a suburb of Milwaukee. The home, which GranCare calls the Audubon Health Care Center, is divided into several units, the largest being a nursing department consisting of a director of nursing, an assistant director of nursing, 19 registered nurses (RNs), 38 LPNs, 90 certified nursing assistants (CNAs), and a handful of clerical employees we need not consider in our discussion.

At any nursing home, someone has to perform rather basic, though nevertheless important, tasks. Someone must help groom, feed, and toilet the residents and change their bed linens. At Audubon, those tasks primarily fall to CNAs, the largest employee group, and everyone in this case agrees that they are not supervisors under the NLRA. Above, and way above, the CNAs are Audubon's LPNs and RNs. Everyone agrees that the RNs, 19 of them at Audubon, are supervisors under the NLRA. But the rubber meets the road with the LPNs, who lie betwixt and between lowly CNAs and lofty RNs.

The differences between Audubon's three levels of nursing department personnel are largely based on education and training: RNs have more of both, are paid more money, and have, within the pecking order of medical regulations, higher licenses. By virtue of their licenses, RNs can perform advanced tasks. For example, RNs can initiate IVs, and for LPNs that is verboten. RNs regularly attend meetings regarding Medicare staffing and rehabilitation, and they often interact with physicians. If nursing employees are absent, RNs are responsible for scheduling replacements. RNs, unlike LPNs, often work from supervisory offices for which they are given keys. RNs also perform evaluations of the CNAs and attend weekly management meetings with GranCare's director of nursing. Also, RNs are salaried and do not punch a time clock. CNAs and LPNs, on the other hand, are paid by the hour and punch time clocks to signal their arrival at and departure from work. During the evening hours, when few workers are on hand, a single "house supervisor RN" is in charge of the facility. This is compatible with Wisconsin law, which the parties tell us requires that an RN be present at the home at all times.

LPNs act as "charge nurses," meaning they are expected to "take charge" by directing the CNAs, using discipline when necessary, and handling complaints. LPNs, according to GranCare, are told that "[t]he role of the Charge Nurse is more than passing meds and doing treatments. The Charge Nurse is a 'management' role in assisting the RN, supervision and direction of CNA's, communicating with MD's, team work with the CNA's (i.e. feeding, answering lights, etc.)." Does this make GranCare's LPNs "supervisors" under the NLRA? The answer to that question will resolve this case.

The Board interprets and applies an ambiguous definition of the term "supervisor" because that is what Congress supplied in 1947 when it removed certain employees from coverage under the NLRA. A "supervisor," starting in 1947, could no longer be in a union, and § 2(11) of the NLRA defined a supervisor as

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.

29 U.S.C. § 152(11).

We discussed, fully, this definition--particularly its origin and purpose--in light of the overall scheme of the NLRA in N.L.R.B. v. Res-Care, Inc., 705 F.2d 1461, 1465-66 (1983). We need not repeat our observations in that case here, but we emphasize that what we said then is equally true today, 16 years later. We also recognize today, as we did in 1983, that when we review the Board's application of its understanding of the term "supervisor" we are "in a gray area, where it is necessary to consider whether the balance of power and conflict of interest concerns that lie behind section 2(11) justify the Board's finding." Res-Care, 705 F.2d at 1466.

In interpreting § 2(11) the Board considers three questions, and each must be answered affirmatively if an employee is to be deemed a supervisor. First, does the employee have authority to engage in 1 of 12 listed activities? Second, does the exercise of that authority require "the use of independent judgment"? Third, does the employee hold the authority "in the interest of the employer"? Northcrest Nursing Home, 313 N.L.R.B. 491, 493, 1993 WL 513158 (1993).

In our case, the Board's Regional Director found that GranCare's LPNs were employees, not supervisors, because their assignment and direction of CNAs was not done in the interests of the employer. The Director then determined that the LPNs could be joined with the CNAs (and a few other employees not at issue here) into a potential bargaining unit, and he ordered a union representation election.

GranCare sought review of the Director's decision, and while its petition was pending (but before the election) the Supreme Court decided NLRB v. Health Care & Retirement Corp. of America, 511 U.S. 571, 114 S.Ct. 1778, 128 L.Ed.2d 586 (1994) (HCR), which addressed the Board's test for determining whether LPNs, acting as charge nurses, are supervisors. The Board's position was, in all similar cases including ours, that a charge nurse's "supervisory activity is not exercised in the interest of the employer if it is incidental to the treatment of patients." 511 U.S. at 576, 114 S.Ct. 1778. The Court rejected the Board's position as a "strained interpretation" of the phrase "in the interest of the employer," id. at 583, 114 S.Ct. 1778, and concluded that the four LPNs at issue--who were grouped with five to seven "staff nurses," including RNs--exercised their authority "in the interest of the employer." Because the Board sought to affirm its finding of nonsupervisory status only on the basis of its interpretation of that phrase, the LPNs in HCR were held to be supervisors under the NLRA.

The HCR decision prompted the Board to send our case (and others around the country) back for reconsideration. The Regional Director reopened proceedings and allowed additional evidence. He then issued a second decision reaffirming his conclusion that GranCare's LPNs are not supervisors, this time holding that they did not exercise independent judgment in their assignment, direction, and discipline of the CNAs. The Board embraced the Director's second view of the case. GranCare disagreed and refused to bargain with the certified union, which caused the NLRB to petition for enforcement of its order that it do so.

It may be troubling to some that the Board, after HCR, switched gears and emphasized a different question (number 2, rather than 3, of the questions that must be affirmatively answered to find supervisory status) in concluding that GranCare's LPNs were not supervisors. The Fourth Circuit recently observed that the Board's decision to change its point of emphasis seems to be "based not on the three-pronged test of the Act but on a 'policy bias.' " Beverly Enterprises Virginia, Inc. v. N.L.R.B., 165 F.3d 290 (4th Cir.1999) (en banc). But we decline to look for sinister motives. It is not our task to conjecture about whether the Board has tried to do an end run around an unfavorable Supreme Court decision so it can broaden coverage under the Act. Instead, we must decide if the Board's post-HCR reason for concluding that GranCare's LPNs are not supervisors--because they do not exercise independent judgment, as the Board understands that term, in their assignment, direction, and discipline of the CNAs--is a reasonable conclusion to draw from the evidence. We are guided by several solid principles of law as we review this issue.

First, we apply a deferential standard of review to the Board's determination because it rests, at least in part, on a factual finding. Res-Care, 705 F.2d at 1465. Second, unless we can fairly say that its view is "arbitrary [or] capricious" within the meaning of the Administrative Procedure Act (APA), we owe deference to the Board's construction of the terms of the statute. See 5 U.S.C. § 706. And, more particularly, we owe the Board deference when it is involved in the construction of an ambiguous provision of a statute it must enforce. Chevron U.S.A. Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837,...

To continue reading

Request your trial
20 cases
  • N.L.R.B. v. Attleboro Associates, Ltd.
    • United States
    • U.S. Court of Appeals — Third Circuit
    • April 30, 1999
    ...of appeals have reached contrary conclusions. See Beverly Enters.-Mass., Inc. v. NLRB, 165 F.3d 960 (D.C.Cir.1999); NLRB v. Grancare, Inc., 170 F.3d 662 (7th Cir.1999); Beverly Enters., Minn., Inc. v. NLRB, 148 F.3d 1042 (8th Cir.1998); Providence Alaska Med. Ctr. v. NLRB, 121 F.3d 548 (9th......
  • Loparex LLC v. N.L.R.B.
    • United States
    • U.S. Court of Appeals — Seventh Circuit
    • December 31, 2009
    ...U.S.A., Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837, 104 S.Ct. 2778, 81 L.Ed.2d 694 (1984); NLRB v. GranCare, Inc., 170 F.3d 662, 666 (7th Cir.1999) (en banc) (according Chevron deference to Board's interpretation of the "independent judgment" requirement in section 2(11))......
  • Cooper/T. Smith, Inc. v. N.L.R.B., 97-7024
    • United States
    • U.S. Court of Appeals — Eleventh Circuit
    • June 14, 1999
    ...between true supervisors, those vested with 'genuine management prerogatives,' and other employees." NLRB v. GranCare, Inc., 170 F.3d 662, 666 (7th Cir.1999) (en banc ) (quoting NLRB v. Bell Aerospace Co., 416 U.S. 267, 281, 94 S.Ct. 1757, 40 L.Ed.2d 134 (1974)). See also Ross Porta-Plant, ......
  • National Steel Corp. v. N.L.R.B.
    • United States
    • U.S. Court of Appeals — Seventh Circuit
    • April 7, 2003
    ...the Board's interpretation of the Act unless it is arbitrary or capricious. Naperville, 242 F.3d at 751 (citing NLRB v. GranCare, Inc., 170 F.3d 662, 666 (7th Cir.1999) (en banc)). When reviewing the record, we defer to the Board's inferences and conclusions drawn from facts, Clinton Elecs.......
  • Request a trial to view additional results
1 books & journal articles
  • Delineating deference to agency science: doctrine or political ideology?
    • United States
    • Environmental Law Vol. 40 No. 3, June 2010
    • June 22, 2010
    ...concurring)). (78) Clark, supra note 34, at 331. (79) Wagner, supra note 6, at 1661-67. (80) Nat'l Labor Relations Bd. v. GranCare, Inc., 170 F.3d 662, 670 (7th Cir. 1999) (citing Chevron, U.S.A., Inc. v. Natural Res. Def. Council, Inc. (Chevron), 467 U.S. 837 (81) Shapiro & Levy, supra......

VLEX uses login cookies to provide you with a better browsing experience. If you click on 'Accept' or continue browsing this site we consider that you accept our cookie policy. ACCEPT