D.C. Circuit Denies Enforcement of NLRB’s Decision Applying Pacific Lutheran Standard

By: Robert Fisher, Jeffrey Berman, Skelly Harper and John Ayers-Mann 

Seyfarth Synopsis: An important issue for colleges and universities is whether faculty are “managerial” employees under the National Labor Relations Act, and thus precluded from union organizing.  Almost 40 years ago, the Supreme Court held in NLRB v. Yeshiva University that faculty are managerial if they exercise “collegial” authority collectively in academic matters.  Five years ago, the Obama Board in Pacific Lutheran University announced a new two part standard for determining the managerial status of faculty members:  (1) whether faculty have decision-making authority in academic programs, enrollment policies, finances, academic policies, and personnel policies; and (2) whether the faculty exercise “actual control or effective recommendation” over each of those areas. 

On March 11, 2019, the Court of Appeals for the D.C. Circuit denied enforcement of the Board’s application of Pacific Lutheran to non-tenure track full- and part-time faculty at the University of Southern California’s Roski School of Art and Design.  The Court remanded the case back to the Board to reconsider its application of Pacific Lutheran.

The case began when Service Employees International Union, Local 721 filed a petition to represent a bargaining unit of full- and part-time non-tenure track faculty member of the Roski School.  USC argued that non-tenure track faculty members were managerial employees because they sat on committees responsible for making decisions in each of the five areas identified in Pacific Lutheran.  After a hearing, the Regional Director, concluded that USC failed to show that the faculty members exercised the requisite control because they represented a minority on those committees.  SEIU won the subsequent election, and USC refused to bargain with the Union in order to challenge the managerial issue.

On appeal to the D.C. Circuit, USC argued that the Board decision conflicted with the Supreme Court’s Yeshiva decision in two ways.  First, USC argued broadly that Pacific Lutheran’s two-part standard also ran afoul of Yeshiva. The Court disagreed.  While cautioning that the Board must be sensitive to the notion of collegial managerial authority, the D.C. Circuit concluded that the two-part standard for effective control did not necessarily contravene the Supreme Court’s Yeshiva decision.

Second, USC challenged the  requirement that faculty subgroups must hold a majority of seats on a committee in order to have effective control.  The Court agreed with the university that this was inconsistent with Yeshiva. The D.C. Circuit reasoned that this aspect of Pacific Lutheran failed to view faculty as a collective body of decision-makers and ignored the potential for commonality among faculty.  The Court emphasized that Yeshiva did not focus on whether one group outnumbered another, but on whether the subgroup was vested with managerial responsibility.

The Court of Appeals granted in part USC’s petition to review and remanded the matter to the Board to undertake review based on a standard more faithful to the Supreme Court’s Yeshiva decision.  The remand could give the newly-constituted Republican majority of the Board an opportunity to reconsider the Pacific Lutheran standard altogether.  Further, while unions have been targeting non-tenure track faculty for organizing in light of that standard, the D.C. Circuit’s decision strengthens arguments that those faculty may be managerial under Yeshiva, particularly where they have the opportunity to participate in committees and other faculty bodies responsible for academic programs.

D.C. Circuit Denies Enforcement of NLRB’s Decision Applying Pacific Lutheran Standard