UNITED STATES OF AMERICABEFORE THE NATIONAL LABOR RELATIONS BOARD

REGION 2

THE NEIMAN MARCUS GROUP, INC., d/b/aBERGDORF GOODMAN

Employer

and Case No. 02-RC-076954

LOCAL 1102 RETAIL, WHOLESALEDEPARTMENT STORE UNION

Petitioner

DECISION AND DIRECTION OF ELECTION

Under a petition filed under Section 9(c) of the National Labor Relations Act, as

amended, a hearing was held before a hearing off icer of the National Labor Relations

Board.

Pursuant to the provisions of Section 3(b) of the National Labor Relations Act,

the Board has delegated its authority in this proceeding to the Regional Director, Region

2.

Upon the entire record in this consolidated proceeding, as well as the briefs filed

by the Petitioner and the Employer after the closing of the record, it is found that:

1 . The Hearing Officer's rulings are free from prejudicial error and are hereby

aff irmed.

2. The parties stipulated, and I find, that The Neiman Marcus Group, Inc. d/b/a

Bergdorf Goodman, herein the Employer, a Delaware corporation, is engaged in

operating retail department stores throughout the United States. During the past twelve

months, the Employer has derived income from the sale of products in excess of

$500,000, and has purchased and received at its New York City store goods valued in

excess of $5,000 from sources and suppliers located outside the State of New York, The

Employer is engaged in commerce within the meaning of Section 2(2), (6), and (7) of the

Act. Based upon the record, and the stipulation of the parties, I find that the Employer is

engaged in commerce within the meaning of the Act, and it will effectuate the purposes of

the Act to assert jurisdiction herein.

3. The parties stipulated that Local 1102, Retail, Wholesale, Department Store

Union, is a labor organization within the meaning of Section 2(5) of the Act. Accordingly,

based upon the stipulation of the parties, the record establishes, and I find, that the

petitioner is a labor organization within the meaning of Section 2(5) of the Act.

4. A question affecting commerce exists concerning the representation of certain

employees of the Employer within the meaning of Section 9(c) of the Act.

5. Petitioner seeks to represent all full-time and regular part-time women's shoes

associates in the 2nd Floor Designer Shoes Department and in the 5th Floor

Contemporary Shoes Department employed in the Employer's retail store located at 754

Fifth Avenue, New York, NY, and excluding all other employees, office clerical

employees, guards and supervisors as defined by the Act. The Employer, on the

contrary, asserts that the smallest appropriate unit must be comprised of a store-wide

unit, or in the alternative, all selling associates in the store.

For the reasons set forth herein, I find that the petitioned-for unit is an

appropriate unit for collective bargaining, and the Employer has not established that

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employees in a store-wide unit or in a unit of all sales associates have an overwhelming

community of interest with the petitioned-for employees. .

OVERVIEW OF OPERATIONS

The Employer is a luxury retailer located on Fifth Avenue in Manhattan. Its

operation consists of a Women's store at 754 Fifth Avenue, and a Men's store, which is

located at 745 Fifth Avenue. The Employer's corporate headquarters is located in

Dallas, Texas.

Bill Brobston is senior vice president and general manager with responsibility for

both the Men's and Women's store locations. Brobston reports to Neva Hall, executive

vice president over specialty retail. Hall works in the corporate headquarters. At the

Manhattan stores, there is a vice president of operations, who covers support

associates' employed at both store locations and reports to Brobston. Nelson Liriano,

who responsible for the Men's store, Diane Kruger, who responsible for fine apparel on

2, designer sportswear on 3, fine apparel on 4, contemporary ready to wear clothing on

5, contemporary shoes on 5, sportswear on 6, lingerie/coats/swimwear on 6, bridal

gown salon on 7, and Anne Marie Seuff, who is responsible for cosmetics and

sunglasses on 1, precious jewelry on 1, designer jewelry on 1, handbags and

accessories on 1, shoe salon on 2, decorative home on 7, and the children's

department on 7, are directors of sales. All three directors of sales report directly to

Brobston. Each floor has a manager who reports to one of the directors and various

department managers who report to a floor manager.

John Marazio is Vice President of Human Resources. Bob Gassensmith,

Director of Human Resources for the Women's and Men's stores, reports to Marazio.

Job classification of support associate is discussed infra.

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There are three human resources managers who report to Gassensmith. One handles

human resources for the Men's store and some support areas, another handles non-

apparel, including 2nd and 5th floor shoes, the other is responsible for human resource

services for apparel in the Women's store.

SALES OPERATION

The Employer employs about 372 sales associates in its two Manhattan stores,

including personal shoppers. In addition, the Employer employs 41 selling assistants.

There are 327 "support" associates, who are non-selling employees, in the Women's

store and 49 in the Men's store. The support associates in the Women's store include

2store design, wrap & pack, cashiers, mail room, housekeeping, carpenters, vertical

transportation (VTC), shipping, client services, restaurant, alterations, fur storage, stock,

loss prevention, visual, and selling services. In the Men's store, support associates

include those employed in housekeeping, returned goods, client services, alterations,

stock, and loss prevention. The housekeepers and alterations employees are currently

represented by the Teamsters and UNITE, respectively.3 The evidence on the record

4indicated that the support staff does not sell products in the traditional sense.

Each sales associate is assigned to a particular department. The 41 selling

assistants are assigned to personal shoppers and high-selling sales associates. The

selling assistants help sales associates gather clothing and merchandise. There are no

2 Cashiers do not ring up merchandise on the floor. They work in a cash office and handleall the cash flow in the store. Sales associates ring up their own transactions.3 Alterations employees in both Women's and Men's stores belong to the Union. It wasunclear from the record whether Teamsters represents housekeeping employees in both storesor just the Women's store.4 Brobston testified that client services sell gift cards and restaurant employees sell food,but that support employees do not sell in the traditional sense.

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5sales assistants in the shoe departments or the Men's store. The selling assistants go

to the sales floor whenever their supervisor asks them to do so.

Personal shoppers work by appointment only. They are expected to pull

merchandise from throughout the store and sell to their customers. There are personal

shoppers assigned to various floors, including the 2nd, 3rd, 4th, and 5th floors, as well

as one in the Men's store. Sales goals are set individually by each department.

All sales employees are subject to the same hiring criteria and apply for work

using the same application forms. There is no requirement that sales associates have

prior retail industry selling experience, although most hires do have such experience.

Similarly, there is no requirement that shoe sales employees have prior shoe sales

experience. However, it is expected that employees know the particular products that

are sold in their departments. All sales and support employees are subject to a six-

month probationary period and have the same employee handbook. The Employer

does the same background and reference check for all hires. All full-time sales

associates work 38.75 hours per week and all full-time support associates work 37.5

hours per week. All sales and support associates have the same vacation and holiday

benefit and all are covered by the same health plans.

All sales associates, exclusive of the shoe sales associates discussed below,

earn 3 to 5% commission, depending on the department. All non-shoe sales department

associates are paid on a "salary plus commission" basis, meaning they are guaranteed

a base salary and the opportunity to earn a commission rate on the merchandise they

5 Assistants are assigned as follows: 4 in main floor accessories, 1 in precious jewelry, 4to 2nd floor personal shopper, 2 to 2nd floor ready-to-wear, 1 to 3rd floor personal shopper, 1 tosolutions, 1 to 3rd floor ready-to-wear, 15 to 4th floor personal shoppers, 5 to 4th floor ready-to-wear, 5 to 5th floor personal shoppers, 2 to 6th floor ready-to-wear.

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sell above the base rate. Sales assistants do not earn commission, and the record is

silent regarding the rate of pay for associates in any department. No support

associates earn a commission, with the exception of client services employees who

might earn a commission if the employee opens a charge account.

All sales associates receive productivity goals, which are tracked on a monthly

,,6basis in a "MPS tracking form. Employees are evaluated in the following categories:

creating a welcoming environment; exceeding customer expectations; and business

development/statistics, including out of home base selling percentages. Goals are

generally the same for all departments, but can differ by department. For example,

Brobston testified that employees are rated on collecting and sending e-mails to

customers. The shoe department is known for collecting and sending a high volume of

e-mails, whereas the fine apparel department, which has fewer customers, has less

opportunity to collect e-mails. At the end of each month, the Employer reviews the MPS

tracking forms. Department managers, in turn, meet with sales associates in their

departments each month to review their performance.

The Employer tracks employees'sales "outside of home base," meaning outside

7of the department where they work, herein the home department, by quarter. The

Employer also tracks sales out of "mega home base," which means an employee sells a

product not just in another department, but on another floor. Monthly employee

evaluations indicate the percent of "out of home base" sales the employee made. "Out

of home base" sales include escorting a customer from one department to another and

ringing up their transaction in that other department. They also include situations where

6 Non-sales associates are evaluated annually. Sales assistants have a differentevaluation form but there was no information about how frequently they are evaluated.7 The program has been in place for two years.

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a customer picks up a product in one department, wanders to another department, and

simply asks a sales associate in that department to ring them up there. The sales

associates usually complete a sale in their own department before bringing the

customer to another department to ring up their next item. Dominic Sgambellone, a

sales associate on the 2nd floor shoe department, however, testified that he often rings

up merchandise from other departments at the customer's request.

In the Fall of 2011, employees sold approximately the following within their own

departments:

1. Contemporary sportswear8: 89%9

2. Decorative home: 99%

3. Fine apparel: 77.5%

4. Beauty: 94.5%

5. Better apparel: 92.9%

6. Handbags and accessories: 94.3%

7. Jewelry: 97%

8. Men's: 99.6%

9. Salon shoes: 97.7%

10. Personal shoppers: 100%10

The contemporary sportswear department includes 5th floor shoes.9 There was an error in the Fall 2012 numbers in contemporary sportswear. Particularly,one sales associate in contemporary sportswear was shown selling 38.2% of her sales in the2nd floor shoe department. Brobston testified that this employee was a shoe salon operatorwho takes shoe orders exclusively by phone and that this number was an error.10 Personal shoppers by definition have no home base and are expected to sell throughoutthe store. Inclusion of this category could artificially inflate the total out of home base sales inthe store if the personal shopper sales total was a significant number.

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In the Spring 2012 quarter, employees sold approximately the following within

their own departments:

1. Contemporary sportswear": 88.8%

2. Decorative home: 93.9%

3. Fine apparel: 76.5%

4. Beauty: 94.9%

5. Better apparel: 93.6%

6. Handbags and accessories: 90.7%

7. Jewelry: 97.5%

8. Men's: 99.6%

9. Salon shoes: 97.7%

10. Personal shoppers: 100%

The Employer asserts that employees are encouraged to sell outside of their

home department, with the exception of bridal, and will take a customer to another

department and will work with an associate in that department to make a sale. Brobston

testified that personal shoppers and sales associates often have partners in other

departments. For example, if a personal shopper brings a customer to the shoe

department, the personal shopper will work with the shoe associate to sell the customer

a shoe. At that point, the shoe associate can decide whether to split the commission or

to keep the entire commission. Associates have the ability to split sales between

associates on the cash register. It was unclear from the record whether the shoe

associate always gets to choose whether to share the commission, or whether the

Includes 5th floor shoes.

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associate only chooses when an associate from another department brings the

customer to the shoe department.

Sgambellone testified that he is encouraged to sell in other departments or on

other floors and had never heard the term "mega home base." He said no manager has

told him to improve his out of home base sales during his monthly evaluations, nor has

any manager discussed a percentage of out of home base sales with him, though he

acknowledged the existence of the out of home base sales box on his evaluation form.

Sgambellone testified he does not have proper training to sell in other departments and

that since his commission in shoes is higher than in other departments, he does not

actively try to sell outside his department because it would result in a pay cut.

Sgambellone testified that he does sell in other departments, but that he believes those

sales make up a small percentage of his sales. The Employer noted on the record that

Sgambellone sold 2.5% of his sales outside his home base in the Fall 2011 quarter.

Sgambellone testified that the majority of his out of home base sales consists of a

customer picking out an item and asking him to ring them up.

Sgambellone testified that he has never seen someone from the men's shoe

department come to women's shoe department to make a sale. He said he recalls one

time over the past three or four years where a women's shoe associate went to the

Men's store, but he did not know if the person sold anything. Sgambellone testified that

women's shoe employees do not leave their departments to go to the Men's store

because they would not know the stock room there, and that they are not trained to sell

shoes to men. Sgambellone testified that when he sees sales associates from other

departments in 2nd floor shoes, they are usually personal shoppers.

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Since in or around 2000 to the present time, there have been approximately 38

transfers between departments, only four of which were into the Women's shoe

departments. 12 There are no records of transfers out of the shoe departments.

Similarly, there is no evidence that employees in one department substitute for

employees in another department.

Brobston presented evidence, in the form of a "mystery shop," a form created by

an outside service that sends someone into the store to shop and evaluate the

customer service provided. The mystery shop evaluation showed that the sales

associate took the customer to more than one floor and department to help the

customer shop. The evaluation did not mention the shoe department. There was no

portion of the mystery shop form that asked shoppers to rate sales associates on their

off er to take the customer to another department. The Employer also presented

customer service surveys evidencing inter-department selling, however none of those

referenced shoes or shoe sales associates.

The Employer holds 10 morning meetings each day before the store opens. The

purpose of the morning meeting is to enhance product knowledge. All employees are

invited to attend the morning meetings, though some of the morning meetings are

department-specific. If two meetings are scheduled at the same time and one meeting

is specific to the 2nd floor shoe department, the shoe employees would be required to

attend the meeting in the shoe department. Such a meeting might be open to

employees from other departments. The Employer contends that it encourages

12 The Employer included two statutory supervisors in its transfer list in addition to the fouremployees mentioned above (a 3rd floor manager and the accessories manager transferred tobe floor manager in 2nd floor shoes) in 2010 and 2011. These transfers will not be considered,as transfers by non-unit employees are irrelevant to the inquiry before me.

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employees who do not have a morning meeting in their department to attend one in

another department. Sgambellone testified that employees who work the late shift

generally do not attend morning meetings. Sgambellone, who works the late shift,

testified that he attends approximately three meetings every month or two. In addition

to the morning meetings, the Employer holds designer and vendor meetings where

employees from multiple departments are welcomed to attend. There are also store-

wide meetings held on a monthly basis for sales and support associates, as well as

monthly meetings for sales associates only. Topics covered at store-wide meetings

include, but are not limited to, new policies, performance, merchandise strategies, and

selling strategies. Topics covered at all-sales meetings are merchandise and store

promotions. Generally one employee from each department is in attendance at the

store-wide and all-seller meetings and a representative from the Men's store attends all

store-wide meetings. Store-wide meetings are mandatory for employees scheduled to

work.

Brobston testified that all sales associates have stock assignments in the

morning where they interact with merchants and occasionally some support associates.

No information was provided about whether employees regularly attend these meetings

or how frequently employees in different sales departments come into contact with each

other on a daily basis, except to say that they are encouraged to sell outside of their

departments.

The Employer conducts an orientation class for all new employees every other

week. The orientation lasts 3 to 5 days. Sales as well as non-sales associates attend

this orientation. After the initial orientation, employees are trained on-the-job in their

respective departments.

There is no formal job description for employees. Sales associates generally

adhere to the same dress code. All associates must appear "presentable and

professional and businesslike." Associates in 5th floor shoes, men's sportswear, and

designer sportswear have a more relaxed dress code than the rest of the store. All

sales associates wear a Bergdorf Goodman pin that is small and round and has a

photograph of the building on it. Support associates are not required to wear the pin.

All employees have personal lockers in the store and have access to the

employee cafeteria located in the Women's store. All employees receive and are

trained to use an Phone to aid their selling efforts.

WOMEN'S SHOES

The Women's store has two shoe departments: Salon Shoes on the 2nd floor,

hereinafter "2nd floor shoes" and Contemporary Footwear on the 5th floor, hereinafter

"5th floor shoes." There are 35 employees in 2nd floor shoes and 11 employees in 5th

floor shoes. There are also two shoe departments in the Men's store. One is on the first

floor and the other is located on the third floor. There are a total of 7 sales associates

who work in the Men's store shoe departments.

Fifteen employees were hired into the women's shoe departments over the past

three years, and only one did not have prior shoe sales experience. It appears that the

human resources manager in the particular area, the department manager, and "usually

the director, 03 make hiring decisions in the department. Second Floor shoe employee

13 It was unclear from the record whether "director' referred to the two sales directors or thehuman resources director.

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Sgambellone had worked previously for retail stores, including Saks Fifth Avenue for

seven years, Neiman Marcus for two years, and Lord & Taylor for two years. By the

time he joined the Employer, Sgambellone had 15 years of shoe sales experience.

Sgambellone testified that shoes are difficult to sell and that he tries to fit shoes

correctly to avoid hurting the customer. He cited bunions, knee problems and back

problems among injuries that could result from improper shoe fitting. Sgambellone also

testified that associates from other departments, who are not trained in shoe sales, sell

shoes incorrectly in his department. There is no evidence on the record regarding the

frequency of such sales by sales associates from other departments who have sold

shoes.

The sales employees working in 2nd floor shoes earn a 9% commission;

employees in 5th floor shoes earn a 10% commission; and employees in Men's shoes

earn a 9% commission. The shoe department associates earn the highest commission

in the store. All employees in the shoe departments work on a "draw versus

commission basis," meaning that at the end of each week, the associate's sales are

calculated, and if they meet their sales goal, they receive their commission rate on their

sales; or they receive the draw rate, multiplied by the number of hours they worked that

week - whichever is higher.

The Employer uses a draw versus commission basis for shoe sales employees

because it is the industry standard for shoe departments. Brobston testified that the

difference between the two salary structures is that the shoe department employees'

commissions are tied to the merchandise in the shoe department, while all other sales

associates' commission is tied to the associate. For example, if a sales associate from

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jewelry sells shoes, the associate will receive the 3 to 5% commission rate, not the shoe

department's 9 to 10% commission rate. Similarly, if a shoe associate sells a handbag,

the shoe associate will earn the lower commission rate of 3 to 5%.

It appears from the record that there are selling departments in which the

average earnings are higher than the average earnings in the 2nd floor shoe

department and 5th floor shoe department and that there are employees in the 2nd and

5th floor shoe departments who earn more than associates in other departments.

Further the 2nd floor shoe employees earn more on average than 5th floor shoe

employees. However, there was no testimony about whether base salaries are higher

in non-shoes department due to the lower commission rate, nor was there testimony

about the amount or range of the draw rate in the shoe departments, except that the

draw rate and base salaries are determined based on when the employee is hired and

level of experience.

ANALYSIS

Based on the foregoing facts, the entire record and careful review and

consideration of the arguments of the parties at the hearing and in their briefs, I find that

the petitioned-for unit is an appropriate unit for purposes of collective bargaining.

In Specialty Healthcare and Rehabilitation Center of Mobile, 357 NLRB No. 83

(Aug. 26, 2011), the Board revisited the standard for finding a unit appropriate where a

labor organization petitions for an election in a unit of employees who are readily

identifiable as a group, and where that group shares a community of interest under the

traditional criteria. In those cases, the Board will find the petitioned-for unit to be

appropriate despite a contention that employees in the unit could be placed in a larger

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unit which would also be appropriate or even more appropriate, unless the party so

contending demonstrates that employees in the larger unit share an overwhelming

community of interest with those in the petitioned-for unit. supra. at *17.

In Specialty Healthcare, the Board reiterated that employees "may seek to

organize 'a unit'that is 'appropriate,' not necessarily the single most appropriate unit."

Specialty, supra at * 13 (quoting American Hospital Assn., 499 U.S. 606, 610 (199 1));

Overnite Transportation Co., 322 NLRB 723, 723 (1996) ("It is well-settled then that

there is more than one way in which employees of a given employer may be

appropriately grouped for purposes of collective bargaining."); J.C. Penney Co., 196

NLRB 708, 709 (1972) (recognizing that though a larger unit could be an appropriate

unit, that did not render the petitioned-for unit inappropriate).

In determining whether a petitioned-for unit is an appropriate unit, the Board in

Specialty Healthcare reverted to the traditional community of interest test. The

traditional community of interest test examines:

[W]hether the employees are organized into a separate

department; have distinct skills and training; have distinct job

functions and perform distinct work, including inquiry into the

amount and type of job overlap between classifications; are

functionally integrated with the Employer's other employees; have

frequent contact with other employees; interchange with other

employees; have distinct terms and conditions of employment;

and are separately supervised.

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Specialty Healthcare, 357 NLRB at *14; United Operations, Inc., 338 NLRB

123, 123 (2002).

In DTG Operations, Inc., 357 NLRB No. 175 (Dec. 30, 2011) the Board reversed

a Regional Director's finding that a petitioned-for unit of rental service agents and lead

rental service agents was not an appropriate unit. The Board held that the petitioned-for

unit possessed the same distinct functions and interests from the other employees.

While noting that the petitioned-for employees shared some of the same benefits as

other employees, there was little evidence of interchange between them and other

employees. Similarly here, this record reflects only the most minimal crossover of shoe

sales associates with other sales associates.

In Northrop Grumman Shipbuilding, Inc., 357 NLRB No. 163 (December 30,

2011), the Board upheld a Regional Director's finding that a petitioned-for unit of

radiological control technicians (RCTs), calibration technicians, laboratory technicians,

and RCT trainees in the E85 RADCON Department was an appropriate unit, even

though it excluded other technical employees employed by the employer. The Board

noted that the petitioned-for employees shared a unique function by providing

independent oversight of radiation exposure. While the employer in that case

contended that there were other technicians who shared the same benefits, personnel

policies, and break facilities, the petitioned-for unit of employees shared a common

work function and constituted a separate department.

Here, the employees in the 2nd and 5th floor shoe departments at 754 Fifth

Avenue clearly share a community of interest. The shoe sales associates occupy the

same job classification and sell the same product, which requires a distinct skill set from

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other sales associates due to the unique nature of the product they are selling. If a shoe

is not sized appropriately for a customer, discomfort and possible knee, back and other

physical injuries could result. The record establishes that the 2nd floor shoe department

sales associates have been given distinct training and possess experience in fitting

customers properly for shoes. Similarly, there was evidence that the shoe sales

associates had little to no training in selling products other than shoes, and therefore,

had negligible sales of products that originated outside their department. Sales

associates in the two shoe departments have a significantly different salary structure

from the other sales personnel in other departments. They receive higher commission

rates than any other employees in the store and are subject to a draw versus

commission wage structure different than non-shoe sales associates.

It should be noted that shoe departments have been determined by the Board to

be appropriate units. See Allied Stores of New York, Inc. d1bla Stem's, Paramus, 150

NLRB 799, 803 (1965) (noting sales employees in Saks Fifth Avenue's New York City

shoe department were voluntarily recognized by that employer and constituted an

appropriate unit). Thus based upon the above facts, and the industry history, I conclude

that the employees in the petitioned-for unit form a readily identifiable group that shares

a community of interest as required by Specialty Healthcare. I also find that the Employer

has failed to establish that the other sales associates in the Women's store and/or the

Men's Store share an overwhelming community of interest.

The Employer contends that the petitioned-for unit is fractured, and that the other

employees in the store share an overwhelming community of interest with the petitioned-

for unit, such that there "is no legitimate basis upon which to exclude certain employees"

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from the unit. Specialty Healthcare, 357 NLRB at * 16 (quoting Blue Man Vegas LLC v.

NLRB, 529 F.3d 417 (D.C. Cir. 2008). Employees share an overwhelming community of

interest when the community of interest factors "overlap almost completely." Blue Man

Vegas, 529 F.3d at 422. See, e.g., Lundy Packing Co., 314 NLRB 1042, 1043 (1994).

Here, the Employer has not met its burden of showing that all other employees in

the store share an overwhelming community of interest with the petitioned-for unit.

First, the Employer argues a wall-to-wall unit is an appropriate unit, with the

exclusion of the following employees: visual, loss prevention, alterations, restaurant,

carpenters, housekeeping, guards, painters, and supervisors. The Employer would

include in its wall-to-wall unit all other support and sales associates. However, these

support associates perform no sales functions and share few community of interest

factors with the petitioned-for unit. The support associates do not earn commission,

they are not evaluated monthly, they do not perform the same job functions nor are they

called upon to fill in for sales associates, they are separately supervised, and have little

to no interaction with the petitioned-for unit.

Second, the Employer argues that in the absence of a wall-to-wall unit, all sales

associates, including selling assistants, must be included because they share an

overwhelming community of interest with the petitioned-for unit. I cannot agree with this

position. As stated above, an overwhelming community of interest exists where almost

every factor overlaps, and that does not exist between the petitioned-for unit and the

other sales associates and assistants in the store. The sales assistants do not perform

a sales function, unless asked to do so by the sales associates. For the most part,

assistants merely pull merchandise together at the sales associate's request.

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Assistants have an entirely different wage scale, as they do not earn commissions.

Additionally, there are no assistants that work in the petitioned-for unit departments.

Further, although all sales associates in the store work toward a common goal of

selling merchandise, the women's shoe department associates have the unique goal of

selling shoes in particular. The sales associates in other departments do not have the

same background and experience in selling shoes. Though the Employer testified that

it does not require shoe department employees to have prior shoe sales experience, the

evidence reflected that all but one shoe department employee had such prior

experience. Sales associates in other departments, on the other hand, do not have

prior shoe sales experience, and as a result, have been observed selling shoes

incorrectly on the rare occasion they sell outside their departments.

There is little evidence of functional integration in the store. The evidence did not

establish that employees work in other departments when needed or substitute for

employees in other departments. Though the Employer encourages employees to

attend store-wide meetings and vendor and designer meetings, women's shoe sales

associates rarely attend meetings with sales associates from other departments. The

Employer argues that employees are evaluated on their "out of home base" sales and

that this is evidence of integration. However, the record indicates that employees

generally sold within their own departments. In particular, 2nd floor shoe employees

sold about 97.7% within their own department in both quarters and 5th floor shoe

employees sold about 92% within their department. There was testimony from a 2nd

floor women's shoe department associate that he does not feel qualified to sell in other

departments and that he would lose money by selling in other departments because he

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would earn less commission there. Rather, he explained that his out of home base

sales are likely from ringing up merchandise from other departments at a customer's

request. There was no evidence employees go into other departments with any

frequency or regularity.

The Employer also relies on evidence of transfers to bolster its contention that

the store employees are integrated. However, evidence of transfers to the shoe

department was negligible. The record establishes that out of about 42 transfers in the

past 13 years, only four employees transferred into the petitioned-for unit and there

were no transfers out of the petitioned-for unit into other departments in the store.

Thus, transfers were insufficient to demonstrate integration between employees in the

petitioned-for unit and other sales associates.

Most notably, the employees in the petitioned-for unit are paid on a different

wage scale than all other sales employees in the store. Specifically, as noted above,

the petitioned-for unit is paid on a draw versus commission basis as opposed to the

base plus commission basis applicable to all other sales associates. Though the Board

has never held that method of payment alone would create a unique unit, the Board

certainly considers method of payment as a factor in determining whether a unit is

appropriate. See, e.g., Sears, Roebuck and Co., 178 NLRB 577 (1969) and J.C.

Penney Co., 196 NLRB 708 (1972). Thus, the distinct method of payment in this case,

coupled with other common community of interest factors, make employees in the

petitioned-for unit similar and distinguishable from other sales associates in the store.

All sales employees are subject to the same health benefits, vacation and holiday

policies, evaluation forms, and probationary periods, and all have access to a common

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cafeteria. Despite these similarities, however, the above-mentioned facts distinguishing

the employees in the petitioned-for unit outweigh these similar personnel policies and

shared break facilities. See, e.g., Northrop Grumman Shipbuilding, Inc., supra, at p. *4

(2011) (finding similar salary structure, personnel policies, shared break facilities and

benefits were outweighed by facts distinguishing employees in petitioned-for unit).

The Employer relies heavily on Bullock's, Inc. d1bla L Magnin & Co., 119 N LRB

642 (1957) in support of its contention that the petitioned-for unit is inappropriate. In

that case, the Board found that the petitioned-for unit of shoe sales employees in the

employer's retail store was an inappropriate unit. There, the evidence established that

all salespeople received the same benefits, the employer did not require prior

experience of shoe department personnel, and employees in other departments had

been assigned to work as shoe salesmen. Thus, despite the different pay scale for

shoe salesmen, the Board concluded that the shoe employees were not sufficiently

different from other employees to warrant a separate unit. Id. at 643.

L Magnin, however, is distinguishable from the instant case. Particularly, the

shoe employees in L Magnin did not have skills separate from other salespeople and

other salespeople were assigned to work as shoe salesmen. By contrast, the record

showed that almost all shoe department employees at issue herein had prior experience

in retail sales, and shoe sales in particular. Moreover, there is no evidence that

employees in other departments are assigned to shoe sales, or that shoe sales

employees are assigned to other departments. Therefore, in the instant case, the

necessary evidence of interchange that might lead to a conclusion that the groups

should be together as it did in L Magnin, is not present.

21

Finally, the Employer asserts that Specialty's footnote 29 cannot be ignored and

that traditional retail industry presumptions must prevail. The Employer asserts that the

Board in Specialty Healthcare noted that its ruling was not meant to disturb special

industry and occupation rules, and that thus, we must follow retail industry presumptions

despite Specialty Healthcare. See Specialty Healthcare, 357 NLRB at * 17 n.29 (stating

holding was not meant to disturb any rules applicable "only in specific industries" other

than in the non-acute healthcare setting).

Relying on footnote 29, the Employer argues that the presumption in a retail

setting is for a store-wide unit of all selling and non-selling employees. See, e.g.,

Bullock's Inc., 119 NLRB 642, 643 (1957); see also Levitz Furniture Co., 192 NLRB 61

(1971); A. Harris & Co., 116 NLRB 1628 (1956); May Department Stores Co., 97 NLRB

1007, 1008 (1951). Even if the Specialty Healthcare ruling was not meant to disturb

established industry presumptions, exceptions to the wall-to-wall unit have been

recognized in the retail industry, and thus, under both Specialty Healthcare rules and

traditional retail industry rules, the petitioned-for unit is appropriate. For example, in

Allied Stores of New York, Inc. d1bla Stem's, Paramus, 150 NLRB 799 (1965), the

Board rejected the presumption of a store-wide unit, finding a unit of all salespersons to

be appropriate. There, the Board noted alternative units in the retail setting, including

the shoe sales employees at Saks Fifth Avenue, alterations employees, display

department employees, and decorators. /d at 803 (noting different units in voluntary

recognition settings); see also Wickes Furniture, 231 NLRB 154 (1977). Thus, though

the presumption of a store-wide unit exists, the presumption can and has been rebutted

in this case.

22

Since Specialty, the Board has shed more light on footnote 29. Particularly, in

Northrop Grumman, the Board referenced footnote 29 and found it could reach the

same conclusion under Specialty as it could under existing presumptions for technical

industry employees. There, the employer argued that a wall-to-wall unit of technical

employees was a presumptively appropriate unit. Id. at *5. The Board, however, noted

that subsets of technical employees who share a community of interest "sufficiently

distinct" from other technical employees could also be an appropriate unit and identified

cases where such smaller units were found appropriate. Id. Perhaps more importantly,

the Board in Northrop Grumman questioned whether a general preference for

combining all technical employees into a single unit was justifiable given the enormous

diversity of technical classifications. Id. at *6.

The Board's approach to Specialty's footnote 29 in Northrop Grumman is

instructive. First, it is clear from that case that subsets of a larger unit can comprise an

appropriate unit. Second, the Board expressed its reservation at creating

generalizations about appropriate industry units. In this instant case, there are more

than 20 departments and 15 support classifications which exist. As stated above, since

a smaller department of shoe employees has been found to be an appropriate unit, and

since the Board has recognized exceptions to the wall-to-wall retail presumption, I find

that under those lines of cases, as well as under Specialty, the petitioned-for unit is

appropriate.

I similarly reject the contention that the Men's store should be included in the

unit, despite the Employer's claim that the Men's and Women's stores are a single

facility. Notably, there is a presumption for single-store units in the retail industry, which

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can be overcome by a showing of substantial functional integration. Charrette Drafting

Supplies Corp., 275 NLRB 1294,1296-97 (1985). Here, there was little evidence of

interchange between the two stores. While the associates in the Men's store have

access to the employee cafeteria at 754 Fifth Avenue, and at least one representative

from the Men's store has attended monthly store-wide meetings, the record establishes

that the Men's store employees rarely associate with employees in the Women's store.

As the two stores are on opposite sides of Fifth Avenue, employees at the two store

locations seldom have the opportunity to interact with each other. There is nd evidence

that employees in one store fill in for employees in the other. There was scant evidence

that the Women's store employees go into the Men's store to complete sales, with the

exception of personal shoppers. Moreover, the "out of home base" sales report

indicated that Men's store employees sell 99.6% of their products in the Men's store.

Additionally, the Men's store has a different human resources manager and sales

director than the Women's store. Based on the foregoing, the Men's store is properly

excluded from the petitioned-for unit under rules governing single-store units in the retail

industry.

Based on the foregoing, though an overall unit including all the Employer's sales

associates in might constitute an appropriate unit, it does not necessarily follow that the

petitioned-for unit is inappropriate. Moreover, the Employer has failed to meet its

burden of showing that other employees in the store share an overwhelming community

of interest with the petitioned-for unit or that the petitioned-for unit is a fractured unit.

In view of the foregoing, I find that the following constitutes a unit that is

appropriate for the purposes of collective bargaining:

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INCLUDED: All full-time and regular part-time women's shoes associates in the2nd Floor Designer Shoes Department and in the 5th Floor Contemporary ShoesDepartment employed in the Employer's retail store located at 754 Fifth Avenue,New York, New York.

EXLUDED: All other employees, off ice clerical employees, guards, andsupervisors as defined by the Act.

DECISION AND DIRECTION OF ELECTION

An election by secret ballot shall be conducted by the Regional Director,

Region 2, among the employees in the unit found appropriate at the time 14 and place

set forth in the notice of election 15 to be issued subsequently, subject to the Board's

Rules and Regulations. Eligible to vote are those in the units who were employed

during the payroll period ending immediately preceding the notice of intent to conduct

election, including employees who did not work during that period because they were ill,

on vacation, or temporarily laid off. In addition, in an economic strike which commenced

less than 12 months before the election date, employees engaged in such strike who

have retained their status as strikers but who have been permanently replaced, as well

as their replacements are eligible to vote. Those in the military services of the United

States may vote if they appear in person at the polls. Ineligible to vote are employees

who have quit or been discharged for cause since the designated payroll period,

14 Pursuant to Section 101.21 (d) of the Board's Statements of Procedure, absent a waiver, anelection will normally be scheduled for a date or dates between the 25 1h and 30th day after thedate of this decision.

15 The Board has adopted a rule requiring that election notices be posted by an employer "atleast 3 full working days prior to 12:01 a.m. of the day of the election." Section 103.20(a) of theBoard's Rules. In addition, the Board has held that Section 103.20 (c) of the Board's Rulesrequires that an employer notify the Regional Office at least five full working days prior to 12:01a.m. of the day of the election, if it has not received copies of the election notice. ClubDemonstration Services, 317 NLRB No. 52 (1995).

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employees engaged in a strike who have been discharged for cause since the

commencement thereof and who have not been rehired or reinstated before the election

date, and employees engaged in an economic strike which commenced more than 12

months before the election date and who have been permanently replaced. 16 Those

eligible shall vote whether or not they desire to be represented for collective bargaining

purposes by Local 1142, Retail, Wholesale Department Store Unit. 17

Dated at New York, New York,This 4th day of May 2012

Kard'Hy-FernbachRegional Director, Region 2 61411(2-National Labor Relations Board26 Federal Plaza, Room 3614New York, New York, 10278

16 In order to assure that all eligible voters may have the opportunity to be informed of theissues in the exercise of their statutory right to vote, all parties to the election should haveaccess to a list of voters and their addresses that may be used to communicate with them.North Macon Health Care Facility, 315 NLRB 359 (1994); Excelsior Underwear, Inc., 156 NLRB1236 (1966); NLRB v. Wyman Gordon Company, 394 U.S. 759 (1969). Accordingly, it is herebydirected that within seven days of the date of this Decision, three copies of an election eligibilitylist, containing the full names and addresses of all eligible voters, shall be filed by the Employerwith the Acting Regional Director, Region 2, who shall make the list available to all parties to theelection. In order to be timely filed, such list must be received in the Regional Office at theaddress below, on or before May 11, 2012. No extension of time to file this list may be granted,nor shall the filing of a request for review operate to stay the filing of such list, except inextraordinary circumstances. Failure to comply with this requirement shall be grounds forsetting aside the election whenever proper objections are filed.

17 Under the provisions of Section 102.67 of the Board's Rules and Regulations, a request forreview of this Decision may be filed with the National Labor Relations Board, addressed to theExecutive Secretary, 1099 14th, NW, Washington, D.C. 20570-0001. This request must bereceived by the Board in Washington by no later than May 18, 2012.

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