Lead Opinion
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 Gran-Care’s director of nursing. Aso, 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
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.,
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,
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,
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 Gran-Care’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 ease. 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 Enter
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,
On top of this, it is important to keep in mind that Congress, in enacting § 2(11), sought to distinguish between true supervisors, those vested with “genuine management prerogatives,” and other employees. NLRB v. Bell Aerospace Co.,
although the nurses may have some supervisory authority, the “if’ clause in section 2(11) ... was intended to exclude from the definition of supervisor “straw bosses,” “lead men,” and other low-level employees having modest supervisory authority ... and the fact that these nurses are, if not full-fledged professionals, at least sub-professionals, indicates that their possession of some “supervisory” authority, loosely defined, need not prevent the Board from classifying them as employees rather than supervisors.
Finally, consistent with congressional intent, “the board has a duty to employees to be alert not to construe supervisory status too broadly because the employee who is deemed a supervisor is denied employee rights which the act is intended to protect.” Westinghouse Elec. Corp. v. N.L.R.B.,
In the aftermath of HCR, the Board announced that it would treat LPNs “the same as all other employee classifications and ... apply to them the same test as [it] applies] to all other employees.” Ten Broeck Commons,
The most important point that the Center overlooks in emphasizing the supervisory responsibilities of the charge nurses ... is that nurses are professionals and their exercise of supervision is guided by professional training and norms. The charge nurses in this case are registered nurses, who are highly trained and responsible. Supervision exercised in accordance with professional rather than business norms is not supervision within the meaning of the supervisor provision, for no issue of divided loyalties is raised when supervision is required to conform to professional stan*667 dards rather than to the company’s profit-maximizing objectives.
Children’s Habilitation Center, Inc. v. N.L.R.B.,
In Children’s Habilitation, we also identified two other relevant factors to consider about nurses:
Our analysis of the Board’s determinations in Res-Care and in American Medical Services emphasized two considerations. They will continue to be our guiding lights in charge-nurse eases. The first is the ratio of supervisory to nonsu-pervisory employees under the competing positions of the parties; the second is the disciplinary authority of the alleged supervisors. The first consideration is central to the balance of power concern, the second to conflict of interest.
GranCare cites several decisions of the Sixth Circuit, including Caremore, Inc. v. N.L.R.B., where that court, applying tests it developed, rejected Board findings of employee status for charge nurses.
Turning to our case, we noted early on that GranCare’s nursing department contained, in addition to a director and an assistant director, approximately 19 RNs, 38 LPNs, and 90 CNAs. Of these, it is conceded that 21 are supervisors and 90 are employees, with the 38 LPNs, acting as charge nurses, in the middle. If, as the Board found, the LPNs are not supervisors, the ratio of supervisors to nonsupervisors at the time of the election is a normal appearing 21 to 128. With that ratio, 14 percent of the nursing work force are supervisors. On the other hand, if the LPNs are supervisors, the ratio of supervisors to nonsupervisors becomes an unwieldy 59 to 90, a top-heavy setup that we think would be bizarre to say the least.
Such a highly improbable ratio of bosses to drones “raises a warning flag,” N.L.R.B. v. American Med. Servs., Inc.,
The concept of “independent judgment” under § 2(11) is, at its core, concerned with those who work at the margins of supervisory authority. The Board must draw a line separating the lowest level of true supervisors—those who are part of management’s team—from those valuable employees who are just on the other side of the line. Those just on the other side of the line are employees who exercise some authority but not
It seems that in comparable post-HCR LPN-as-supervisor cases around the country the Board is generally concluding that the supervisory authority typically exercised by LPNs over CNAs is not exercised with “independent judgment” as contemplated by § 2(11). Specifically, the Board has taken the position that the “judgment” of LPNs in exercising their incidental supervisory authority over CNAs is not the “independent judgment” concerned with management prerogatives contemplated by § 2(11). Rather, it is more properly viewed as “professional judgment” exercised in getting their assigned work done with the assistance of CNAs employed for that purpose. It seems to us that, given the nature of the LPN charge nurses’ primary work activity and incidental supervisory function in the classic pattern of these cases, the Board’s construction of “independent judgment” for application to them cannot be declared “arbitrary [or] capricious” under the APA. We think it is a permissible construction of an ambiguous term entitled to deference under Chevron.
The record before the Board supports the conclusion that although GranCare’s • LPNs have some assignment, scheduling, and disciplinary powers over CNAs, they exercise those powers in fairly routine, preordained ways. They act more like “straw bosses” than foremen. We cannot say that the Board’s understanding of the concept of “independent judgment” is arbitrary or capricious, or that the application of that understanding to GranCare’s LPNs as a . factual matter is without evidentiary support. The Board’s view also results, as we just noted, in a more realistic boss-to-worker ratio, which is further evidence of the merit of its interpretation of the concept of “independent judgment.” Because no other significant issues prevent enforcement of the NLRB’s order in this case, Enforcement is ordered.
Dissenting Opinion
joined by COFFEY, Circuit Judge, dissenting.
Today, this court concludes that Licensed Nurse Practitioners (“LPNs”) are not supervisors within the meaning of the National Labor Relations Act (“the Act”). It reaches its decision by mistakenly deferring to the National Labor Relations Board’s (“NLRB” or “the Board”) interpretation and application of the statutory term “independent judgment.” In doing so, the majority also improperly elevates two policy concerns over the language found in the Act itself. Therefore, I must respectfully dissent.
While it is true that courts review Board decisions with a deferential eye, it is not a blind one. Courts owe agencies a measure of deference with regard to actions, findings, and conclusions, unless they are arbitrary, capricious, or an abuse of discretion. See 5 U.S.C. § 706(2)(A). The Supreme Court explained this standard and established a two part test to guide courts in Chevron, U.S.A., Inc. v. Natural Resources Defense Council, Inc.,
Even though courts may rely upon the Chevron analysis, they are not required to follow this standard in all cases. In NLRB v. Res-Care, Inc.,
is a finding that necessarily leans heavily on an interpretation of the statute; and while the Board is entitled to some judicial deference in interpreting its organic statute as well as in finding facts, it would be entitled to even more if it had awakened its dormant rulemaking powers for the*669 purpose of particularizing the application of section 2(11) to the medical field.
Id. Thus, less deference is afforded when agencies act outside their rulemaking authority. Courts also do not owe agencies deference when they act manipulatively. See Children’s Habilitation Ctr., Inc. v. NLRB,
The Board’s propensity to engage in manipulation of the term “supervisor” is well known. See, e.g., NLRB v. Winnebago Television Corp.,
In the case before us, the Board continues its practice of cynically manipulating the Act. The Board’s interpretation of “independent judgment” as creating a distinction between “professional” and “managerial” judgment enables it to reach the same conclusion — that LPNs are not supervisors — that it had under its earlier rejected interpretation of the Act. The fact that the Board did not adopt its “professional”/“managerial” distinction through ,a legitimate rulemaking procedure, nor establish a consistent standard explaining the content of the test, also lessens the court’s duty to defer to the Board.
I am further troubled by a willingness to skim over the facts surrounding the process by which the Board reached its interpretation. The majority concludes that the court must be “guided by several solid principles of law” in its review of the case rather than conjecture of improper agency behavior. It is not conjecture, however, but rather a simple' illumination of the procedural history of this case that leads me to conclude that the Board, once again, is manipulating its enabling statute to achieve the result it desires.
In its first decision involving GranCare LPNs, the Board stated:
[assignment of work and direction of the [certified nursing assistants] CNAs is done in the LPNs’ technical capacity. Thus, while at times it may constitute the utilization of independent judgment, it is judgment utilized in the Nurses’ treatment of patients and does not constitute the exercise of supervisory authority in the interests of the Employer.... The Employer herein has hired [registered nurses] RNs and LPNs for their expertise and ability to exercise independent judgment involving patient care. Professional and technical employees do not lose their protections of the Act merely because they exercise independent judgment in matters relating to patient care.
That patient care analysis, which resulted in LPNs being classified as nonsupervisors, fell flat when challenged before the Supreme Court, however, and was rejected. See Health Care & Retirement Corp.,
This history of tortured interpretations indicates that the Board’s post-Health Care & Retirement Corp. analysis is the classic outcome oriented approach it has utilized in the past. By its conduct, the Board has forfeited Chevron deference. See, e.g., Providence Alaska Med. Ctr. v. NLRB,
Thus, it is my conclusion that in this case we should review the Board’s determination that LPNs are not supervisors under a substantial evidence standard of review. See Mid-America Care Found. v. NLRB,
rubber-stamp the Board’s decision simply because the supporting evidence may be “substantial” when considered by itself and in isolation from the evidence that fairly detracts from the Board’s conclusion.... Rather, [they] must take into account the entire record, including evidence opposed to the Board’s view from which conflicting inferences reasonably could be drawn.
NLRB v. Adam & Eve Cosmetics, Inc.,
In determining whether the Board’s decision is supported by substantial evidence we must look to the statutory test found in the Act. See Health Care & Retirement Corp.,
The only remaining issue, of course, is whether LPNs exercise independent judgment. The Board has not engaged in rule-making to aid in the analysis of what constitutes the exercise of independent judgment.
However, rather than rely upon the text of the statute to reach its conclusion, the majority focuses primarily upon the secondary in-dicia this court adopted in Res-Care,
In contrast to the majority’s analysis, the Supreme Court followed a text-centered approach for determining whether an employee rises to the level of a supervisor under the Act in Health Care & Retirement Corp. The Court conducted a fact-specific examination of the case, relying only upon the statutory text to reach its conclusion. See Health Care & Retirement Corp.,
In an attempt to establish a legal grounding for its conclusion, the Board also claims to rely primarily upon the statutory text. It attempts to establish an interpretation of “independent judgment” that creates a non-textually based distinction between “professional” and “managerial” judgment. As the Supreme Court has noted, “[t]he Act does not distinguish professional employees from other employees for purposes of the definition of supervisor in § 2(11). The supervisor exclusion applies to ‘any individual’ meeting the statutory requirements, not to ‘any nonprofessional employee.’ ” See id. at 581,
In applying the statutory test of independent judgment, I believe the record as a whole demonstrates that the LPNs’ duties qualify them as supervisors. Their duties include assigning CNAs to patients, supervising CNA tasks, transferring CNAs to other wings within the facility when necessary, monitoring CNAs, determining whether CNAs complete their tasks properly and in accordance with patient care requirements, performing CNA evaluations, issuing commendations to CNAs, disciplining CNAs, scheduling specific CNAs to specific tasks, and rearranging CNA break times. In addition, when CNAs fail to perform their duties correctly, the LPNs are held accountable. In performing these duties LPNs must exercise independent judgment in both a professional and managerial sense. The decisions made during an LPN’s shift are similar to those of shift managers who allocate assignments to counter employees in a fast food restaurant and who we held were supervisors under the Act. See American Diversified Foods,
Although external considerations clearly affect the shift manager’s discretion when making these assignments, nothing prevents the shift manager from basing his decision, at least in part, on the requirements of the specific job and his opinion of the counter employee’s individual capabilities. This is sufficient exercise of his independent judgment.
Id. at 896 (citations omitted). Similarly, LPNs make their decisions based upon their professional knowledge, as well as the managerial policies of the nursing home. The record lacks evidence suggesting that LPNs follow a specific procedure in assigning CNAs or that they consult with an RN during the assignment process. No evidence exists in the record indicating that these duties are merely routine or clerical either. LPNs must assess the CNAs’ experience and responsibility, determine how much monitoring each individual CNA requires, as well as consider the needs of the patients to whom the CNAs are assigned. Based on the text of the Act alone, the LPNs are required to exercise independent judgment in fulfilling their duties. There is little, if any, evidence in the record supporting the Board’s conclusion that these LPNs are not supervisors because their decisions are based entirely upon professional judgment.
The Fourth Circuit en banc reached a similar conclusion in two cases involving the status of LPNs acting as charge nurses under the Act.
These duties parallel those of the LPNs in our case. The record establishes, through testimony as well as job descriptions, that the LPNs had the authority to assign CNA duties, the authority to reassign CNAs, the authority to determine the ratio of CNAs to patients, the authority to monitor CNAs, the authority to instruct CNAs, and the authority to discipline CNAs, by sending them home for misbehavior. In addition, the LPNs are subject to disciplinary actions for failing to monitor CNAs. CNAs are also told that they are responsible to the charge nurse, a position which all LPNs hold. (All LPNs are charge nurses, and some RNs may be charge nurses.) Among other things, CNAs must report patient behavior and conditions to the charge nurses, perform procedures the charge nurses assign and instruct them to complete, report any equipment and supply needs to the charge nurses, and practice first aid measures as instructed by the charge nurses. The bottom line is that the LPNs’ duties require them to supervise the CNAs. In doing so, they, like the LPNs in the Fourth Circuit cases, must exercise the type of independent judgment associated with supervisors, regardless of their professional knowledge.
In sum, while we may owe the Board some deference, we should not review this case under the highly deferential Chevron standard because the Board has repeatedly and continuously acted in a manipulative manner, forfeiting its entitlement to such deference. The decision of the Board should be reviewed under a substantial evidence standard of review, and we should rely solely upon the statutory text and not secondary indicia, such as the ratio of supervisors to nonsupervisors. Upon examination of the record as a whole, substantial evidence fails to support the Board’s conclusion. Rather, it demonstrates that LPNs do exercise independent judgment and, therefore, are supervisors within the meaning of the Act. I dissent.
Notes
. As a result of the end run around Health Care & Retirement Corp., GranCare during the second Board hearing could not introduce new evidence with regard to the independent judgment prong because the factual issues had been decided and not altered directly by the Supreme Court's Health Care & Retirement Corp. decision. Thus, they were prohibited from introducing into evidence two key facts that provide additional support for the conclusion that LPNs in this case are supervisors. LPNs’ duties regarding their evaluations of CNAs changed when GranCare began using them in determining whether CNAs receive raises. In addition, GranCare hired a new assistant director of nursing who implemented management training for LPNs to aid them in their already existing managerial duties. These specific duties merely echo the evidence already in the record demonstrating that LPNs exercise independent judgment and, thus, are supervisors.
. In addition to the Fourth Circuit, at least two other circuits have similarly concluded that LPNs are supervisors. See Mid-America Care Found.,