The National Labor Relations Board (NLRB) v. Baylor University Medical Center case in 1978 revolved around the question of whether or not interns, residents, and fellows at a non-profit hospital should be classified as "employees" under the National Labor Relations Act (NLRA), thus granting them collective bargaining rights. The NLRB had ruled that they were employees; however, Baylor University Medical Center disagreed and refused to bargain with its house staff association. The Supreme Court sided with Baylor University Medical Center, ruling that these medical professionals are primarily students who are engaged in graduate education while also providing some services to the hospital. Therefore, they do not qualify as employees under NLRA and aren't entitled to collective bargaining rights.

In the dissenting opinion for the case of NATIONAL LABOR RELATIONS BOARD v. BAYLOR UNIVERSITY MEDICAL CENTER, Justice Rehnquist disagreed with the majority's decision to extend jurisdiction over non-profit hospitals by National Labor Relations Board (NLRB). He argued that Congress had not intended for NLRB to have such authority when it passed the Taft-Hartley Act in 1947. The act excluded governmental entities and wholly religious institutions from its purview but did not specifically mention non-profit hospitals. However, he believed this was because at that time most non-profit hospitals were either government or church-run and thus already exempted. As more secular nonprofits emerged, they should still be considered outside of NLRB’s jurisdiction as per original intent of law makers rather than being subjected to a different interpretation due to changing circumstances.