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UNSTACKING THE DECK - "MUSTS" IF YOU WANT TO STAY UNION FREE IN 2014


UnStacking the Deck – Keys to Staying Union-Free in 2014

 

Since 2009, employers that are union-free (and intend to stay that way) have had to deal with a blizzard of new decisions and rules by agencies of the Obama Administration to make union organizing easier and more difficult to resist.  It appears that the final pieces of a grand payback to organized labor, in lieu of the Employee Free Choice Act, will fall into place in 2014.  As a result, employers will have to reinvent their union-free strategies to meet game-changing challenges.  Employers that do not change and retool their union-free strategies dramatically will find that organized labor has been dealt all of the winning cards.  .Future court decisions may block some but not all of the changes that the National Labor Relations Board (Labor Board) and Department of Labor (DOL) are poised to implement.  Prudence dictates, however, that employers should prepare for the worst – a world where the balance between labor and management rights is tipped decisively in favor of labor.  This shifted balance can be effectively countered only if employers do several important things, most of them before union organizing is detected.  Once union organizing is underway, there will not be time to make and the Labor Board’s law will prevent most of the most essential and effective changes.

The Capstone Changes Expected in early 2014

Employers cannot overlook the sincerity of the current Administration’s strongly held belief that employees are always better when represented by unions and that union representation is necessary to revitalize and reestablish a strong Middle Class.  Implementation of this belief has evidenced itself in the appointment into key administrative positions of zealots who feel they are on a country-saving mission.  Theirs, they believe, is a grand and noble mission where nearly any means will justify the end.

The Labor Board will almost certainly republish its new election rules and, in doing so, all but erase the ability of employers to respond effectively to union organizing post- petition.  This may come as early as April.  By that time, in March, the DOL will have issued its new interpretations of the Labor Management Reporting and Disclosure Act (LMRDA) that will redefine the public reporting requirements for employers who use third-party consultants or attorneys to establish and implement union-free strategies or combat active organizing.  These are the remaining two pieces that will complete the Obama Administration’s rescue plan for big labor.  When combined with the reinterpretations of the law already made by the Labor Board, union organizing will not only be easier but nearly irresistible…unless non-union employers learn to operate in this entirely new environment.  Yet, there are things that can be done to create a winning strategy to remain union-free.  

NLRB Election Rules Changes:

In April of 2012, the Board published a series of rule changes to force speedy representation elections and to restrict (some would say eliminate) the ability of employers to affect issues such as the appropriateness of the requested unit and voter eligibility  These changes were enjoined by a court in May of 2012 because at the time the Rules were issued, the court said the Board lacked the necessary quorum to engage in rule-making.  As a result of the court’s action, the Board withdrew the new rules.  The technicality relied on by the court has now been cured and now, with a full slate of members, the Chairman has signaled that that he wants to reissue the Rules, including, perhaps, even those portions that were removed from the original version during negotiations to avoid the resignation of the opposing member.  There is no doubt that when the Rules are proposed to the other members by Board by the Chairman, the pro-union majority will act quickly and favorably.

One combination of these Rule changes will shorten the time between the filing of a petition and an election.  Under some circumstances, they would permit an election to be conducted as soon as fourteen days after the petition, only one week after the hearing where the Regional Director sets the date of the date of the election and the voting unit.  These changes would make “organizing by ambush” more than a catch-phrase.

Another group of changes, when combined with substantive law modifications that will be discussed later, would nearly eliminate the ability of employers to litigate the appropriateness of the bargaining unit requested by the union and voter eligibility in the hearing on the union’s petition.  As a consequence, an employer may be unable to stop an election in a unit that is as small as a single classification or makes no operational sense merely because it was requested by the union (usually based on support for the union).  The employer also would not be certain who would be considered to by the Board to be supervisory and, therefore, would not know who could be required to participate on behalf of the employer in the campaign to combat the union’s drive and provide information with regard to voter concerns and attitudes. 

 Board Decisions

The Obama Board has already made it a protected right for employees to use social media to disparage their employer, prohibited instructions to keep the existence and content of an investigation of employee misconduct confidential, placed extreme limits on restrictions on off duty access to the employer’s property and, soon, is likely to open the email system of employers to use by union organizers.  The Labor Board has also been quick to use injunctions against alleged wrongful conduct during organizing and imposing enhanced remedial orders, such as the reinstatement of discharged employees pre-election before it is finally determined that the discharge was due to union activity, access to the employer’s premises for union organizers, in-facility speeches by union organizers, and attendance by union organizers at captive audience meetings.

Three decisions make resistance to the union organizing especially difficult.  The first relates to proposed bargaining units, the second to the definition of supervisor and the third to the use of neutrality agreements.

Specialty Healthcare:

In Specialty Healthcare (357 NLRB No. 83 (2011)) the Labor Board held that a unit of certified nurse assistants in a nursing home constituted an appropriate unit for an election and bargaining.  The employer had argued that a unit limited to CNAs was inappropriate and should include all non-professional employees, a common unit in nursing homes.  In making its decision, the Labor Board rejected its long-standing presumption in favor of wall-to-wall or large units, against the proliferation of units and against “extent of organizing units”.  In the future, it said, units, perhaps even as small as a single job classification, would be found appropriate.  Not less significant was the Board’s declaration on the burden of proof necessary for an employer to prove that the unit requested by the union was inappropriate.  Going forward, the employer’s burden will not just be persuasion, but the employer would be required to establish by “overwhelming evidence” that the requested unit would be inappropriate unless it included (or excluded) certain other employees.  This unprecedented and extraordinarily high burden is expected to be carried only rarely.  The result is that the appropriate unit for the election will almost always be the unit desired by the union and the issue of appropriateness of the unit is effectively off the table prior to the election. 

Specialty Healthcare cleared the way for multiple “micro-units” within a single workplace and balkanized workforces where several different unions may each represent only small groups of employees.  The dysfunction that would result from a state of nearly constant bargaining, constant risk of strikes and constant “one-upsmanship” would be dramatic, costly and debilitating.  At a minimum, a single union could obtain a foothold in the workplace by organizing a single, small group of employees. At its worse, movements between classifications, job flexibility, cross-training and a host of other operational imperatives would be either impossible or come at great and unnecessary cost to efficiency.

This operational nightmare is a significant and real consequence of this Board’s decision and not fear-mongering.  Since Specialty Healthcare, Regional Directors have directed elections in such units as the cosmetics and scents employees at Macy’s and the women’s shoes at Bergdorf-Goodman.  Different unions and different contracts for each department in a department store is not far from different unions and different contracts for each classification in a manufacturing facility.

Oakwood Healthcare and Croft Metals, Inc.

While these two cases (Oakwood Healthcare, 348 NLRB No. 37 (2006); Croft Metals, Inc. 348 NLRB No. 38 (2006)) predate the Obama Labor Board, they are now being applied much more vigorously.  In these two cases the Labor Board narrowed the definition of “supervisor” significantly.  Supervisors are not “employees” under the NLRA and, therefore, are not entitled to the protections of the Act.  That means, supervisors have no protected right to engage in or to support a union and employers may count them on supervisors to resist union organizing and can interrogate them with regard to what they know about such activity in the workplace.  If the supervisors do not cooperate, they can be discharged from their employment without violating the National Labor Relations Act.  By narrowing the definition of a supervisor, employers are limited in who they can rely on during the course of a campaign.

Under these cases, for example, the Board will not consider the assignment of work to be an indicia of supervisory authority unless the exercise of this authority is not routine (not pursuant to detailed employer guidelines) and requires the exercise of independent judgment.  Other critical points of examination are the amount of time spent supervising, as opposed to doing employee work, and whether the supervisors are held accountable for the performance of those who are supervised.

Equally problematic with regard to the supervisory issue is that the likely new Rules will prohibit the litigation of whether an employee is or is not a supervisor pre-election, unless the number of the individuals involved is more than 10% of the proposed unit.  As a consequence of the narrowing of the definition of supervisor and the likelihood that the supervisory issue will not be decided pre-election, employers are left uncertain as to whether a particular individual is a supervisor until after the election, when the issue may be the subject of  an unfair labor practice charge alleging that the employer interfered with the protected rights of “an employee” when it included the “supervisor” in strategy sessions regarding union activity.  Including them as employer representatives during a campaign because the employer, in good faith, believes they are supervisors, therefore, places the employer at risk of having the election results overturned and other remedial Board orders.  Further, fearing that an employee may be improperly classified as a supervisor may push an employer to reduce the number of individuals it may use as advocates against unionization and as sources of information, only to find that the votes of those whom the employer was conceding to be employees are challenged by the union on the basis that they are, in fact, “supervisors.”  Unsure employers are placed in a classic “damned if you do and damned if you don’t” dilemma with some individuals feeling demoted when the employer, out of an abundance of caution, tells them that they being excluded from the “inner process” because they are not supervisors. 

Dana Corp, 356 NLRB No. 49 (2010)

In Dana Corp.  ( 356 NLRB No. 49 (2010), the Labor Board approved of a neutrality and cooperation agreement between Dana and the UAW.  The UAW had induced Dana not only to be neutral (not oppose the union’s organizing effort and agree to a card check) to union representation of the employees at a particular plant, but also to facilitate the organizing drive by providing the names and contact information of the employees to the Union and issuing a statement that the Company believes that it can work cooperatively and positively with the Union.  In return, the UAW agreed that, when it obtained the collective bargaining rights, it would not oppose in principle the productivity and incentive plans the Company felt were important. 

In this case, the UAW induced the Company’s neutrality and cooperation agreement with promises related to a subsequent collective bargaining agreement.  Some unions have achieved neutrality agreements by agreeing to back legislation favorable to the employer.  Other unions have coerced neutrality agreements through picketing, adverse publicity and/or regulatory (e.g., OSHA, EPA) complaints.[1]

At first blush, combatting a the neutrality and card check strategy does not appear to be relevant to a discussion of election-based strategies.  However, neutrality and card check agreements are not effective if the union is unable to obtain signatures on authorization cards from a majority of the employees.[2]  The subject also is relevant because the neutrality strategy has become the preferred method of organizing by some unions and employers must be prepared to combat it.  Many of the elements of a union-free strategy to resist traditional union organizing discussed below are also effective to neutralize or eliminate the desire of employees for union representative. 

New Persuader Rules

The Labor Management Reporting Act of 1959 requires that any third party hired by an employer to persuade employees with regard to union representation must report the nature of the activities and the amount paid to them by the employer.  Employers have a similar reporting requirement.  The reports must be filed with the Department of Labor and are available to the public on the DOL website.  The law contains an exception for “advice” and, historically, the DOL has defined “advice” as not including strategic, training and campaign-related services if those services were not rendered in direct contact with employees.  Services that are only indirect in that they involve only working with managers and supervisors of the employer who would then have direct contact with the employees would not have to be reported.  This is a bright-line rule that has prevailed for the last forty years. 

The DOL has announced that in March of this year it will issue a new interpretation of the law so that now only strictly legal advice will be considered to be within the advice exception and not reportable.  That is, if an employer sends a document to a lawyer for advice concerning its compliance with the law (as distinguished from its effectiveness or advisability), the activity and fee paid would not have to be reported.  However, if the employer asks the lawyer for advice concerning whether it would be a good thing to use the document in a campaign or for modifications that do not relate directly to the law, that advice would fall outside the advice exception and have to be reported.  Services that consist of the creation of a union-free strategy, training supervisors with regard to union organizing, and/or creating documents or speeches for use during a campaign and the fees charged for those services would have to be reported by both the employer and the service provider.  As noted above, those reports would be published on the DOL website for viewing by an interested union or any other person. 

Under the rule as it was proposed first in 2012 (and it is likely that the rule that will be published will be at least as far-reaching as the proposed rule, regardless of the numerous objections from employers and employer representatives), if a consultant or lawyer engages in any reportable activity, all labor services provided by that consultant/lawyer (and all others in the firm with which the consultant/lawyer is associated) to the employer, even if not directly related to a union-free strategic plan or a union campaign, would have to be reported along with the amounts paid.  This would include the development of or advice concerning policies, reviews of handbooks, and training.  Only actual work in connection with litigation and other direct legal advice would be excluded from the mandate. 

The bottom line is that, unless enjoined (there is likely to be a court challenge at least on the issue of whether the new rules violate attorney-client privilege), any employer using any third party consultant or lawyer to assist it to remain or to become union-free will have to make public that it is doing so, what it is doing and how much it is paying for the service.  Once reported, the information can be republished by a union to employees in an effort to discredit the employer or impugn the employer’s motives.

Since most employers do not have the resources to have strategic union-free specialists on staff, the new persuader rules may diminish the use of third party specialists.  Since studies historically confirm that employers who use third party union free specialists are significantly more successful than those who don’t, the persuader rules are viewed by some labor commentators as a way to clear the field for union organizers.  This consequence would be exacerbated if unions turn the reports into the moral equivalent of Megan’s Law (and they very well may).  Thus, employers that may be reluctant to obtain the services they need to combat union organizers, would be left to deal with the guile of professional organizers alone. 

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Unstacking the Deck

In spite of the Obama Administration’s apparent determination to do everything possible – short of legislation – to assist unions to obtain new members, employers are still in control of their own destiny when it comes to remaining union-free…if they are willing to make the effort.  In addition, if  these employers act before the new persuader rules are promulgated in March, they may keep their strategic planning confidential. 

While not an exhaustive list, here are some things that employers should be doing now to stay union-free:

Neutralize the Desire for Third Party Representation (It will be too late after organizing begins)

·                     Have wages and benefits that are competitive with unionized companies in the area.  The value of being union-free lies elsewhere and if you are significantly under market, you will likely fail.

·                     Enable employees to have a stake in the organization’s success.  When the company’s success is “our” success, outsiders are not welcome.

·                     Have an effective communication program.  Employee security often depends on their knowledge of how you and they are doing and why things are happening that change or may change their lives.

·                     Make safety and equal/fair treatment important.  Besides keeping you on the right side of the law, it communicates that you care.

·                     Have a credible/legal problem solving system.  Employees with unresolved problems beg for help.

·                     Provide employees with due process.  If you provide protections from unfair treatment, employees do not need to find it elsewhere.

·                     Train supervisors how to manage employees and employee performance.  Supervisory failings in performance management frequently stimulates looking to the outside for help.

·                     Give supervisors time to supervise.  If supervisors do not have time to see and solve employee problems, employees have nowhere to turn but out.  Lean operations are sometimes anorexic .

Have a Strong and Communicated Union-Free Philosophy (You may not have time after a petition is filed)

·                     Communicate that you think it is important for the company to be union-free and why, avoiding reasons that can be twisted to appear exploitive.  “We don’t need a union because we need flexibility” can be heard as “we don’t want a union because we want to jerk you around.”

·                     Communicate what you are doing to make unions unnecessary.  If someone does not make the connections for them, employees may not see or appreciate it.

 

Educate Supervisors, They Need to Know[3]  

·                     Reasons why employees seek union representation and how to avoid or eliminate them.

·                     How unions organize employees.

·                     What unions are and can/can’t do.

·                     What supervisors can/can’t do with regard to protected activity.

·                     What their responsibilities are to recognize, report and respond to suspected union organizing without violating the law.

 

Structure Operations to Have Desired Employee Units

·                     Know what you need to show to have the employee units you desire and then adjust your operation (if necessary) to create “over-whelming evidence” that make undesirable and micro-units inappropriate.

·                     Collect and have easily retrievable documentary evidence to assure that you will be able to present within seven calendar days all that is necessary to carry your burden of “overwhelming evidence.”

 

Make Sure Those You Want to be Supervisors Will Meet the Board’s New Definition

·                     Prepare job descriptions that contain the indicia of supervisory status.

·                     Establish wage, evaluation and other policies and systems that establish that your supervisors are, under the law, supervisors.

 

Have a Rapid Response Plan

·                     Be prepared to respond effectively and quickly (within 24 hours) to credible union organizing.

·                     Be prepared to prove what is necessary to be proven at a post-petition hearing.

 

The reality is that the agencies of the Obama administration are stacking the deck in favor of unions and making it easier for unions to organize employees.  They are doing this by

 

·                     depriving employers of the time to educate employees effectively once a petition is filed,

·                     limiting the rights of employers to challenge and avoid election/bargaining units chosen by unions solely on the basis that they will be the easiest to organize.

·                     restricting the definition of “supervisor” and denying employers the ability to have that issue resolved pre-election.

·                     encouraging “card-check” strategies that include coerced or purchased neutrality and cooperation agreements. 

·                     expanding the public reporting of the nature and cost of union-free services provided to employers who use non-employee experts, encouraging employers without on-staff union-free specialists to remain vulnerable.

 

As a result of these administrative actions, keeping your workplace union-free in 2014 and for the foreseeable future will require more urgency and very specialized efforts.  Hopefully, this list of things you must do will be a guide.  Another word to the wise -- if you do not feel you have the in-house capability of meeting the challenge and wish to create your strategies within the confidentialities of your own company, you should consider seriously doing, at least, the most important strategic work prior to the March publication of the new rules for non-employee specialists who will then be required, as will you, to file public reports for inclusion on organized labor’s version of its own “Megan’s Law” type list of despicable offenders.



[1] Neutrality agreements have been challenged in the federal courts as providing something of value to unions in violation of Section 302 of the Labor Management Relations.  Two Circuit Courts of Appeals have reached opposite conclusions and the issue is now pending before the U.S. Supreme Court (Hollywood Greyhound Track, Inc.) and a decision should be made in this term.

 

[2] It is worth noting that the attack against the neutrality and cooperation agreement in the Dana case was brought by an anti-union employee and majority of the employees rejected the union.

[3] You won’t have time after a petition is filed

 
 
 
 

Labor Board Launches Website Aimed at Non-Union Employees


LABOR BOARD LAUNCHES WEBSITE DIRECTED AT NON-UNION EMPLOYEES

 

On June 18, the National Labor Relations Board launched its new website directed at non-union employees.  The website, www.nlrb.gov/concerted-activity, is attached and directs readers to the Board’s agency website.  The agency website, www.nlrb.gov, details the employee rights that are protected by the National Labor Relations Act (e.g., the right to belong to and promote union representation) and provides instructions about how to access the Board to obtain redress for employer violations of the law.

 

The website was originally intended to accompany the Employee Rights poster that the NLRB was set to require employers to post on April 30.  The Employee Rights poster is hung-up in litigation.

 

Visitors to the website are given eleven examples of instances where non-union employees sought assistance from the Labor Board and achieved reinstatement to employment and damage awards.  The examples all involve instances when the Labor Board was successful in getting discharged employees reinstated to their employment with full back pay or obtained significant settlements (in one case, $900,000) in return for refusing reinstatement.  These examples were as follow:

 

·                     An employee was discharged for posting on her Facebook page criticisms of her supervisor.

 

·                     An employee was discharged to keep her from talking to other employees about perceived wage rate unfairness.

 

·                     Employees were discharged for walking off the job in protest of a change in work rules.

 

·                     Employees who signed a petition protesting working and living conditions were threatened with deportation and then discharged.

 

·                     Employees were disciplined for asking to meet with a human resource representative to complain about a supervisor who they had discovered was a registered sex offender.

 

·                     Employees were discharged for sending a protest letter about a wage cut.

 

·                     Employee who discussed her wages with another employee was discharged

 

·                     An employee was discharged for refusing to divulge the names of the authors of an anonymous petition critical of senior management.

 

·                     Employees who signed a protest letter complaining about a wage cut were fired.

 

·                     Employees who raised safety concerns were fired.

 

·                     Employees were discharged for complaining on You Tube about unsafe working conditions.

 

Presumably, the Labor Board will add new examples with even more captivating fact patterns as they occur.  

 

Employers have been conditioned to examining each instance of discipline or discharge to ensure that the decision has not been tainted by illegal bias against a member of a protected class.  Employers must now include in that examination whether the decision implicates rights protected by the National Labor Relations Act.  The Labor Board is anxious to find as many examples as possible. 

 

Untrained managers and supervisors and rules of conduct that, for example, prohibit the disparagement the employer, use of the company logo, or inappropriate conduct risk place their employers at risk of another pin in the Labor Board’s map of malefactors.

Read my new article on the Labor Board's current campaign -- and how far it will go -- to educate non-union employees on their rights under the National Labor Relations Act in the June 15 issue of HREonline. 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 
 
 
 

LABOR BOARD NULLS ARBITRATION AGREEMENT WITH NON-UNION EMPLOYEES


LABOR BOARD FINDS PRIVATE ARBITRATION AGREEMENT WITH NON-UNION EMPLOYEES UNLAWFUL

 

In what could be a stunning upset of private arbitration agreements, the National Labor Relations Board (“NLRB”) has held that provisions in an arbitration agreement that prevent an arbitrator from considering a group, class or collective action violates the National Labor Relations Act and are unenforceable.

 

As a condition of employment, D. R. Horton, Inc., a national home builder, required employees to sign an arbitration Agreement by which the employees agreed to submit all employment disputes to final and binding arbitration.  In addition, the Agreement provided that, while the arbitrator would have the right to resolve an individual’s claim, he/she would not have jurisdiction to resolve group, class or collective disputes. 

 

The limitation on the arbitrator’s authority in the Horton Agreement is a common method by which employers seek to avoid the expensive process of litigating class and collective lawsuits without limiting the ability of the employee to have his/her individual claim or dispute resolved.

 

Shortly after signing one of these agreements, an employee filed a complaint alleging that he had been misclassified as exempt from overtime under the FLSA.  The complaint also asserted that there were other employees who were similarly situated and that the employee’s claim was in the nature of a nationwide class action.  The Employer, while permitting the employee to submit his individual complaint to an arbitrator, denied the arbitration demand as it related to the class allegations.  The employee filed an unfair labor practice charge with the NLRB, alleging that the limitation in the arbitration Agreement was an unlawful restriction on the employee’s right to engage in concerted activity and that the employer’s refusal to permit the case to proceed as a class action violated his rights under the NLRA. 

 

The case was heard first by an Administrative Law Judge.  The ALJ found that the Agreement was unlawfully vague in that the employee could believe that his right to submit any statutorily-based complaint to a relevant governmental administrative agency (e.g., EEOC, DOL) was prohibited.  Based on established judicial authority, the ALJ held that the right to file a complaint with a governmental administrative agency charged with the responsibility of administering a particular statute cannot be limited by an arbitration agreement, while the denial of access to a court to resolve a complaint based on an alleged violation of a statutory right may be permissible under the Federal Arbitration Act (“FAA”).  The confusion in the Agreement on that issue made the Agreement invalid.  That’s an established principle and not particularly noteworthy.

 

With regard to the limitation concerning group, class and collective actions, however, the ALJ found that the protection of concerted action provided by the NLRA was not violated by a private contract that did not impinge on the employee’s right to have the claim resolved by an otherwise lawful arbitration complying with the FAA.  This holding was consistent with a 2006 Memorandum by the General Counsel of the Board addressed to Regional offices as guidance (GC Memo 10-06).

 

On appeal to the Labor Board, a majority of a three member panel (Board, Chairman Pearce and Member Becker) upheld the ALJ’s decision regarding vagueness but reversed the ALJ on the issue of whether the arbitration Agreement violated the NLRA.  The Agreement’s limitation with regard to class and collective actions, they said, prohibited protected concerted activity.  As a consequence, the Agreement was unenforceable and either must be rescinded or modified to permit class and collective actions.  Member Hayes did not join the majority in the decision.

 

At its core, the case involved an apparent clash between the FAA that preserves the right of individual contracts to resolve disputes through arbitration and the NLRA that protects employee rights to engage in concerted actions with regard to terms and conditions of their employment. 

 

On the way to considering the core dispute, the Board said first that, even if the employee had not consulted with any other employee prior to his assertion of the class status of his complaint, the fact that he said that his complaint was on behalf of others as well as himself made his conduct concerted activity and protected by the NLRA.  The resolution of this preliminary issue was, by itself, a caution to employers that, when assessing the risk of any employment decision, regardless of whether the employee is represented by a union or not, the NLRA also must be considered.  While the Board will find that many actions by employees are on behalf of themselves alone and not protected by the NLRA, the Board defines “concerted” activity broadly and will stretch to find many actions that an employer may believe to be purely individual to the employee to be protected concerted activities.

 

As to the core issue, the Board held that the NLRA’s protection of concerted activity is not a procedural right but a substantive right and, therefore, the limitation on an arbitrator regarding class actions wais a waiver of a substantive right.  Since the intent of the FAA was to leave substantive rights undisturbed, the FAA would not be violated by the Board’s protection of the right to exercise a substantive right (in this case engaging in concerted activity).  Consequently, enforcement of the NLRA does not conflict with the FAA.  Besides, they said, the NLRA was passed after the FAA and contained a repealer of all inconsistent prior laws.  Therefore, conflicts between the two statutes have to be resolved in favor of the NLRA.

 

The subtlety in this case is that, while an employee’s access to a governmental agency statutorily charged with the responsibility of administering a particular law, such as the EEOC or DOL, cannot be taken away and replaced by arbitration, arbitration can replace adjudication of the substantive claim by a court where an arbitrator has the same rights and powers of a court to determine the merits of the claim and to fashion an appropriate remedy.  Here, however, while the arbitrator had the right to decide and remedy the claim of the individual, the arbitrator could not decide the claims of others that were brought on their behalf.  It was this right to state claims on behalf of others, that the Board said was a substantive right protected by the NLRA. 

 

This case is most certainly going to be appealed and the last word on the issue will be a court’s, perhaps even the Supreme Court’s.  In the meantime, however, employers who seek to limit their expense and risk of class and cooperative actions by foreclosing those kinds of cases from arbitration and restricting proceedings to individual matters need to be aware that the Labor Board would consider such limitations to violate the NLRA.  The conservative remedy would be to permit class and cooperative actions to be litigated in arbitration, at least until the issue is finally resolved by a court. 

 

Again, a decision of the Labor Board is having a direct and significant effect on non-union employers and there appears to be no let-up in the Board’s campaign to inject the NLRA into all aspects of all workplaces.  Employers considering employment decisions who limit their risk assessments to Title VII, the ADEA, the ADA, the FLSA and the state equivalents are dangerously short-sighted.  The current Labor Board is making it clear in case after case that the NLRA will be applied to all workplace decisions without regard to whether the workforce is represented by a union or not.

 

JOIN MY WEBINAR

 

The impact of the NLRA on non-union workplaces will be discussed in greater detail and depth in my webinar on February 21.  To register for the webinar follow this link:  NLRB Rules for Non-Union Employers.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 
 
 
 

LABOR BOARD ENDORSES DOUBLE STANDARD IN PRE-ELECTION CONDUCT


LABOR BOARD ENDORSES DOUBLE STANDARD IN UNION REPRESENTATION ELECTION CAMPAIGNS  

 

In the waning days of Member Becker’s term on the National Labor Relations Board, the Board majority decided a case based on the underlying proposition that unions and employers are to be held to different standards when assessing the legality of pre-election literature and tactics. Enterprise Leasing Company and Teamsters Local 391, December 29, 2011.  

 

Teamsters Local 391 was seeking to represent the employees of an Enterprise Leasing operation.  A union supporter took a photograph of another employee with seven other employees of Enterprise in a nearby food court.  Subsequently, the photograph was printed on a flyer surrounding the words “Yes. Everybody can make the right choice?”  The other side of the flyer said the employees should vote for the Union to be their voice for better pay, better benefits and better treatment.”  

 

After losing the election, 44 to 41, with two challenged ballots, Enterprise filed an objection which alleged that one of the employees in the photograph had not agreed to permit his picture to be used on the union flyer and, therefore, there was a misperception created that the Union had the support of the employee and that the employee had been unlawfully subjected to coercion by being publically identified as a union supporter.  This, the employer asserted, was enough to warrant a new election, especially in light of the closeness of the vote.  

 

In finding that the flyer, at most, implied that the Union had the employee’s permission to use the photograph, a majority of the Board majority consisting of Chairman Pearce and Member Becker held that the other employees could easily recognize the flyer as campaign propaganda and, therefore, the election process had not been tainted.  The employer was not entitled to a rerun election. Citing a 2001 case that was enforced by the Third Circuit Court of Appeals, Allegheny Ludlum, Member Hayes, in his dissent, argued that the established rule that an employer cannot use the image of an employee in campaign material without the employee’s consent should be applied equally to the union in this case.  Elemental fairness, he reasoned, required the equal application of the rule to both the employer and union. In response, the majority cited a 1969 Fifth Circuit Court of Appeals decision in which the court wrote: “An employer in an unorganized plant, with his almost absolute control over employment, wages, and working conditions, occupies a totally different position in a representation contest than a union, which is merely an outsider seeking entrance to the plant.”  

 

So, for this Labor Board, there are two standards.  Because one of the objectives of the National Labor Relations Act is to equalize power in the workplace and to achieve this objective of the law, according to the current majority, one side should be permitted to spread misperceptions of support and coerce employees while the other should not.  Machiavelli cheers.  

 

The lesson: Do what you can keep a union from gaining sufficient support to compel a representation election in the first place by having a well-crafted union-free strategy with specifically designed policies and training.  If a union gets the support necessary to have an election, this Labor Board will not judge the pre-election campaign conduct of an employer and a union by the same rules, to the disadvantage of the employer. 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

OBAMA WAGES WAR ON BEHALF OF LABOR UNIONS


OBAMA WAGES WAR ON BEHALF OF LABOR UNIONS

 

The good news is that the National Labor Relations Board has postponed the date by which employers must post an Employee Rights Under the NLRA poster from January 15 to April 30.  Of course, the postponement was at the request of the federal judge hearing the complaint brought by various employer groups to have the posting enjoined completely.

 

The bad news is that Obama continues to take an extreme pro-labor position when it comes to the membership of the NLRB.  The Constitution requires that presidential appointments to the NLRB must be confirmed by the Senate.  A president may by-pass the process by appointing the nominee to the position for a term that must expire at the end of the next Senate session.  A president usually does this when he believes that his nominee will not be able to garner the approval of the 60 votes necessary to end a filibuster.

 

Last Spring, Obama, unable to get his appointment of Craig Becker through the Senate, used the recess-appointment process made him a Board member which would have an expiration date of the adjournment of the Senate at the end of the calendar year.  Becker was the first appointee to the NLRB in history who came directly from an in-house position with a labor union, in this case the Service Employees International Union.  At about that time, the President’s nomination of Mark Pearce (D) and Brian Hayes (R) were confirmed.

 

With a three to one majority of pro-labor members on the Board, the NLRB has issued rules, proposed rules and made decisions that have helped union organizing and increased the power of labor unions.  With the expiration of Chairman Liebman’s (D) term in August and the expiration of Becker’s recess appointment at the end of the calendar year, the Board was left with only two members and, due to a 2010 decision by the U.S. Supreme Court, the Board became unable to decide cases or issue new rules.

 

On December 14, 2011, Obama announced his intent to nominate Sharon Block and Richard Griffin to the Board.  On December 19, 2011, all 47 Senate Republicans sent a letter to the President asking him not to make Block and Griffin recess appointments because to do so would violate the long history of appointments being negotiated between the Administration and the Senate to come up with individuals at least palatable to both parties.  On December 19, 2011, 11 Republican Senators also wrote Obama asking that he withdraw the nomination of acting General Counsel of the NLRB,Lafe Soloman, to the full position of General Counsel. 

 

On January 4, 2012, Obama officially ignored the Senate Republicans and made recess appointments of both Block and Griffin (along with Terence Flynn (R)).  If the appointments hold, the Board will be at full strength with two Republican (presumably pro-business) and three Democratic (presumably pro-labor) members.

 

Both Block and Griffin can be expected to pick up right where Leibman and Becker left off since they are of the same philosophical cloth.  Block came from the Department of Labor where she had been the Deputy Assistant Secretary for Congressional Affairs.  Prior to that, Block had been the Senior Labor and Employment Counsel for the Senate HELP Committee where she worked for the late Senator Edward Kennedy.  Reports have been circulating  that Block was the center of the current proposal by the DOL to severely restrict the definition of “advice” for the purposes of required reporting to the DOL of union prevention activities.  Under the proposed rule change, virtually every non-employee, including attorneys, who provides assistance to a company to preserve its union-free workforce would have to report all financial payments and arrangements for those activities to the DOL for publication on the DOL website.  In the words of Secretary of Labor Hilda Solis, “she will be sorely missed” by the Department of Labor.  Solis supported the Employee Free Choice Act and is one of the most vocal advocates in government for organized labor.

 

Griffin is the second person to be placed on the NLRB directly from a labor union (Becker being the first).  Griffin was the General Counsel for the International Union of Operating Engineers (IUOE).  Since 1994, he also has been on the board of directors for the AFL-CIO Lawyers Coordinating Committee. 

 

Actions have already been filed to block these recess appointments, as well as that for the head of the Consumer Financial Protection Bureau.  The challenges have been on the basis that the Senate technically has not gone into recess, because every three days since Christmas a senator has appeared in the chamber to gavel a session into order and, with no business to conduct, within a minute, gavels the session closed.  Technically, the filings assert, because the Senate is not in recess, no recess appointments can be made. 

 

Of course, if the suits are successful and the appointments are held to be invalid because the Senate is not in recess, will Craig Becker still be a member?

 

Stay tuned.

 

At a minimum, businesses cannot expect any relief from the barrage of pro-union actions and decisions by the NLRB, particularly those that assist unions in their organizing efforts.  Since one of the changes that has already occurred may cut the time between a petition and election by as much as half, employers who wish to remain union-free must continue to hone and implement their Rapid Response Plans

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 
 
 
 

DID THE BOARD BLINK?


DID THE BOARD BLINK?

 

On June 22, the National Labor Relations Board published a Notice of Proposed Rulemaking as the first step in its massive overhaul of election procedures.  This overhaul was obviously calculated to advantage organized labor’s organizing and disadvantage employers who wish to remain union free.

 

Between June 22 and August 22, the Board received over 65,000 comments and heard testimony from 65 witnesses, many, if not most, objecting to the proposed rule changes.

 

On August 23, then Chairman of the Board, Wilma Liebman’s term expired, leaving the Board with only three members, Democrats Becker and Pearce and Republican Hayes.  At the end of the current legislative session, Becker, a recess appointment, will have his term expire.  Upon the expiration of Becker’s term, the Board will lose the quorum (three) required for decisions and other official actions.  In short, the Board will be out of business.

 

Two weeks ago, the Board gave notice that it would issue a modified set of new rules governing election procedures on November 30, to beat the deadline before it loses its ability to act due to a loss of quorum. 

 

Hayes threatened to resign before November 30, claiming that the contemplated action was without his knowledge or participation in the process of determining what the new rules would be.  His resignation would deny the Board the legal ability to adopt the new rules because it would cease to have the necessary quorum.

 

Today the Chairman of the Board, Pearce, released the details of the rule changes that will be presented for final adoption tomorrow.  Hayes has not resigned and, in light of the lateness of the hour, it is unlikely that he will resign.  Consequently, the Board will have a quorum and the proposed rule changes in the Chairman’s Resolution will become final with Pearce and Becker passing them over the expected dissent by Hayes. 

 

In short, they rule changes that will be made final tomorrow are of only minor moment, especially when compared to what Becker, Pearce (and previously Liebman) and organized labor really wanted.  It appears that Becker and Pearce blinked in the face of Hayes’s threatened resignation and have deleted almost all of the most controversial changes that were proposed in June. 

 

The new rules will:

 

1.   Give the Board’s hearing officer the authority to limit evidence introduced at a representation hearing only to what the officer believes is material to whether a question of representation exists.  Issues ancillary to that question, such as those having to do with supervisory status or other questions challenging the eligibility of some employees to vote may not be permitted and certainly will not be allowed to delay the process.

 

2.   Give the hearing officer the authority to deny requests to file a brief on an issue raised at a representation hearing where the officer believes that a brief is not necessary to assist in making a decision on whether a question of representation exists.

 

3.   Delay the review of issues that are excluded by the hearing officer at a representation hearing until the post-election hearing, when, presumably, most would have been rendered moot by the election.

 

4.   Delete from the existing Rules the provision that provides for additional time between a representation hearing and an election to permit petitions to the Board to review decisions by the hearing officer.

 

5.   Permit appeals to the Board from decisions made at a representation hearing only in extraordinary situations where the appeal would otherwise evade review.

 

6.   Give the Board discretion to hear appeals in representation cases, regardless of whether the decision from which the appeal is taken is pre or post-election.

 

Not included in the rule changes to be finalized tomorrow (November 30) are the most controversial changes proposed on June 22:

 

·                     Electronic filing of petitions

 

·                     Requirement that representation hearings must be held within 7 days from the date of the notice of the hearing

 

·                     Requirement of a position statement at the outset of a hearing

 

·                     Preclusion of issues for trial post-election that were not included in the position statement filed at the representation hearing

 

·                     Inclusion of email addresses and phone numbers on voter lists

 

·                     Reduction in time for providing the voter list to the union from the current 7 work days to 2 work days

 

 

Chairman Pearce emphasized in his press release today, however, that the additional changes are still on the table and “remain under consideration by the Board for possible future action.”  Stay tuned. 

 

While the Board can be criticized for making decisions that do not reflect the real world, this much we now know – they have learned the definition of “hard bargaining,” thanks to Brian Hayes.

 

Even though the threat of the Board using its rule-making authority to tilt the field favorably in the direction of organized labor apparently has subsided for the time-being, we should be keeping a wary eye on Lafe Solomon, the General Counsel, and other actions the Board may take that do not rise to the level of formal rulemaking.  For example, the current guideline for Regional directors that elections must be held within 42 days from the date of a petition, absence extraordinary circumstances, is not part of any formal rule.  It is a guideline that can be changed without a lengthy hearing or comment process. 

 

Because of the continuing threat that the Board, either through its members or General Counsel, will take some action that will prejudice the ability of employers to combat union organizing, employers who wish to remain union-free should be doing those things now that are designed to neutralize and combat any appeal that a union may have to its employees.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 
 
 
 

BAD HAIR DAY EVOLVES INTO CONDUCT PROTECTED BY THE NLRA


BAD HAIR DAY EVOLVES INTO CONDUCT PROTECTED BY THE NLRA

Nichole Wright-Gore, a supply clerk in a non-union nursing home, had a bad hair day.  To hide her embarrassment, she wore a hat.  An executive of the nursing home told her that wearing a hat in the workplace violated the company’s dress code and she was told to take off the hat or go home.  She went home rather than suffer the embarrassment of having other employees see her bad hair. 

The following day, Wright-Gore returned to work, again wearing a hat.  Presumably, she thought that the fact that employees were invited to wear Halloween costumes that day would give her greater latitude.  Again, she was told to remove the hat.  As she took off the hat, she complained that the company was unevenly enforced its dress code.  Her complaint generated a written warning for insubordination.

Over the next two weeks, Wright-Gore talked to other employees about her bad hair days and the disparate enforcement of the dress code.  The other employees “generally” agreed and sympathized with her.  She also used her cell phone to take pictures of other employees who appeared to be out of compliance with the dress code.  As she talked to other employees about her alleged mistreatment, she showed the pictures as “proof” of the validity of her complaint.  When one employee complained to his manager that Wright-Gore had taken his photograph without his consent and had shown it to other employees, Wright-Gore was fired for taking photographs inside the nursing home in violation of the facility’s no photograph rule.

Wright-Gore filed an unfair labor practice charge, alleging that her discharge violated the National Labor Relations Act.  Her charge asserted that her taking of photographs was protected as “concerted activity” in protest of a work rule.  The Board filed a complaint against the nursing home and an Administrative Law judge of the Board agreed with the Board.  The nursing home was ordered to reinstate Wright-Gore with full back pay. 

The employer appealed the case to the full Board, which, expectedly, affirmed the ALJ.  The employer then filed an appeal with the Federal Court of Appeals for the Fourth Circuit.  Both before the Board and in its appeal to the Court, the employer argued that the employee was motivated solely by self-interest and had been engaged in a personal, rather than group, campaign.  Therefore, contended the employer, Wright-Gore was not engaged in concerted activity protected by the National Labor Relations Act. 

In an unpublished opinion filed on October 28, 2011 (NLRB v. White Oak Manor, 4th Cir. No. 10-2122), the Court affirmed the Board’s decision and ordered Wright-Gore reinstated to her job and made whole for any losses due to her discharge.  In deciding the case, the Court agreed with the Board that, when the employee sought the support of co-workers, her conduct went beyond her self-interest and became protected by the law.  The fact that she was not asked by the employees to be a spokesman on their behalf was not fatal to her claim.  Further, the fact that she was not fired for violating the dress code but for violating the rule against taking photographs was not a sufficient defense because there was evidence that other employees had taken, posted and circulated photographs taken within the facility in the past without being disciplined and the taking of photographs was part of a related sequence of events. 

The employee’s personal protest involving the disparate enforcement of the dress code, of which the violation of the no-photograph rule was a part, had morphed into concerted activity protected by the National Labor Relations Act. 

There are several lessons to be learned from this case:

  • A Court on review will give significant deference to the Board’s interpretation of the law.  As a consequence, goofy Board decisions may survive judicial review.
  • The employee’s complaint about the dress code began as something very personal, but the mere fact that the employee sought emotional support from other employees was sufficient for the Board to conclude that the employee was engaged in concerted activity.  That’s the goofy part.
  • Once protected conduct is found, the Board will find subsequent related but different events to be protected as well.  Here, the employee was discharged for violating a rule that was different from the rule she was protesting because the violation of the no-photograph rule was linked to the events about which the employee was protesting. 

What is “common” about this case is that the failure to enforce a rule consistently always raises the question of “why in this case?” 

This question is at the heart of many complaints brought under many laws, including Title VII, state civil rights laws and, as here, the federal labor law.  Employers must account for inconsistencies in enforcement of rules at the time the rule is enforced if the inconsistencies are not to be the basis for subsequent liability. 

When deciding issues of discipline and discharge particularly, employers can no longer restrict their analyses to protections afforded under the civil rights laws.  Now, the investigations must include whether the employee’s conduct may be protected concerted activity under the National Labor Relations Act.

What is not “common” about this case is the a frighteningly broad definition given by the Board to what constitutes protected concerted activity.  While employers may assume that courts will ultimately bring reason into play and correct the Board’s excesses, the assumption is often wrong because courts will give the Board’s interpretations of the Act, even the goofy ones, great deference on appeal. 

 
 
 
 

Labor Board Blurs Line Between Management Rights and Protected Activity and Then Orders a "Perp" Walk


Labor Board Stretches to Blur Line Between Management Rights and Protected Activity and Then Orders a “Perp Walk”

 

In a case decided on August 11, the National Labor Relations Board affirmed an Administrative Law Judge’s determination that an employer, the publisher of the Santa Barbara News-Press, committed numerous violations of the National Labor Relations Act.  That was not remarkable.  Coercive interrogations about union activity, surveillance of union activities, requiring the removal of union buttons and signs and terminating a supervisor for refusing to commit unfair labor practices clearly violate the Act and have done so for over half a century. 

 

What was remarkable is that the Board decided an issue that was not required for the holding and, instead, appears to have gone out of its way unnecessarily to broadly define activity protected by the Act.

 

The case involved news reporters.  The publisher of the newspaper issued several directives.  The first limited the coverage of the arrest and sentencing of the paper’s editorial page editor.  The second prohibited reporters from including the home addresses of public figures (in this case, Rob Lowe) in news stories.  Finally, the publisher limited what information about the paper could be disseminated by its reporters to other news media.  The edicts resulted in a discharge, numerous resignations, a campaign to cause the cancellation of subscriptions, union organizing and, ultimately, an election which was won by the union.

 

The Board, in affirming the ALJ, held that the publisher’s editorial controls and edicts impacted the journalistic integrity of the reporters.  As a consequence, the Board said, the publisher’s conduct interfered with the protected rights of the reporters.  What moves the decision out of the outrageous category is that the actions taken by the publisher were so mixed with other unfair labor practices that it is hard to isolate what could otherwise have been a clear encroachment by the Board on management prerogatives.  Despite the Board’s protestations to the contrary, the fact remains that on some level it blurred the line between management’s rights to run its business and employee protected activity.  Whether the Board will use this case as support in the future for further limiting management authority is for another day. 

 

A couple of other things make this case worthy of comment.  First, the publisher’s stated reasons for the actions against the employees were numerous and, to the ALJ, that multiplicity smacked of pretext.  Had the publisher limited its reason for action to the management prerogative argument, the case would not have been so easy for the Board.  As in civil rights litigation, cases can be lost because an early statement about why a certain action was taken turns out to be incorrect and pretextual.  The lesson is that employers must be smart from the beginning and not rely on after-the-fact-lawyer-spin to win cases.  The reason for the action must be formulated with the law and available proofs considered before the action is taken. 

 

The second reason for reporting on this case is the Board’s amendment to the remedy ordered by the ALJ.  The amendment says a lot about the current Board’s bias against employers. 

 

In addition to the expected cease and desist, reinstatement, rescission of negative performance evaluations and make whole remedies, the ALJ ordered, again expectedly, that the employer must post a notice stating the rights of employees to engage in union activity, pledging no further violations of the Act and listing the actions it will take to remedy the prior unlawful conduct.  The actions the ALJ required from the employer were severe and extensive, directly touching virtually every employee.  There is no question that the entire workforce would know what and how the NLRB had concluded their employer violated their rights.  No one working for the employer would have any question.  No one working for the employer would be left in the dark.  Nothing more was required.  Nothing more was needed.

 

The Board, however, apparently thought there was something more that was needed – groveling.

 

The Board ordered that the remedy be amended to require a senior member of management to read the Board’s complete Order to the assembled employees or to stand next to a Board agent as the Order is read.  It is the Board’s version of a “perp walk.” 

 

Since this kind of communication was not necessary in this case to communicate with few employees of a small employer, the only motive for the Board’s action could be the demeaning of the employer. 

 

Unfortunately, I suspect there will be more of this kind of anti-management retaliatory conduct by the Board in the future, as it continues to increase the ante for employers who are charged with violations of the Act.  By raising the remedial stakes to an unconscionable level, does the Board feel that it will be able to coerce employers into settling cases of questionable merit or inconsequence, thereby aiding unions in their organizing efforts?  If this is the motive, the Board is actively trying to subvert the law and process in favor of organized labor. 

 

 
 
 
 

IN THE WAKE OF THE DREAMLINER: THE LABOR BOARD PREPARES TO CHANGE THE RULES ON BARGAINING OVER DECISIONS TO RELOCATE WORK


IN THE WAKE OF THE DREAMLINER

 

THE LABOR BOARD PREPARES TO CHANGE THE RULES ON BARGAINING OVER DECISIONS TO RELOCATE WORK

 

On May 10, 2011, the Acting General Counsel of the National Labor Relations Board sent a memo to all of the Board’s Regional Offices telling them to submit all pending cases involving the issue of whether the employer had a duty to bargain with the union representing its employees about a decision to relocate work.  In a speech given by Solomon on June 9, he stated the reason for the Memo: he wants to find an appropriate vehicle for the Board to reconsider the Board’s long established rules governing bargaining over decisions about taking work out of unionized plants and moving it to more friendly environs.  Apparently, the fire-storm Mr. Solomon caused by the complaint against Boeing for its decision to place work in a new, non-union South Carolina plant rather than in a strike-plagued unionized plant in Washington was not enough for him. 

 

Mr. Solomon’s instruction follows Chairman Leibman’s musings in a case published on March 31, 2011, that she believes it may be time to require employers to provide information to its union detailing the reasons why it may decide to relocate work, even where the decision could not be affected by anything a union might do.  See Embarq Corporation and IBEW, 356 NLRB No. 125 at page 2.  A change in the rule as suggested by Leibman (and now contemplated by the Acting General Counsel) would be a sea-change in the way unionized employers will be required do business..

 

The current rule was developed through numerous cases and finally settled in 1991 in Dubuque Packing Company, 303 NLRB 386, 1991, enfd. in pertinent part 1 F3d 24 (D.C. Cir 1993) review denied 511 U.S. 1138 (1994).  Broadly stated, the rule is that where company’s a decision to relocate work was for reasons that did not sufficiently implicate labor costs so that the Union could do nothing that would cause the reversal of the decision, the employer would not be required to bargain that decision with the union.  If, however, the Union could do something to keep the work (such as by reducing labor costs through concessions), the employer would be obligated to bargain about the decision and give the Union an opportunity to make the necessary changes.  Even if the employer would not be required to bargain about the decision to move work, it still would be required to bargain about the effects of the decision (e.g., severance).

 

Currently, if a Union believes that the decision was something they could have reversed by giving concessions, it can challenge the decision through a refusal to bargain charge against the employer.  In such a case, the Company would have to show that the Union could not or would not have made concessions sufficient to stop the work relocation.  The Labor Board, after a trial, would decide whether the Union could have made sufficient concessions and whether the Company violated the law by not bargaining about the decision.  The Board would have the equitable power to require a reversal of the decision, pending bargaining. 

 

Bargaining over a decision to relocate work would require the Company to give the Union the facts on which it based its decision and its conclusion that the Union could make no concession that would induce the Company to change the decision.  Because most Companies do not wish to subject the decision to relocate work to what could be protracted and contentious union negotiations, the preferred course of action is to analyze the factors within the confidential walls of the management offices, leaving it to the Union to challenge the decision in retrospect without interfering with the immediate flow of business.

 

The scenario and process that Leibman is considering is dramatically different:

 

To encourage more constructive good-faith bargaining, we might modify the Dubuque framework, for example, by requiring the employer to timely advise the union whether its contemplated relocation plan turns on labor costs.  If the relocation does not turn on labor costs, the employer would be required to so advise the union and explain the basis of its decision.  If it does turn on labor costs, the employer, upon timely request, would be required to provide the union with information about the labor-cost savings and advise whether, in its view, the union could make concessions that could change its decision.  If the employer provided the information, and the union failed to offer concessions, the union then would be precluded from arguing to the Board that it could have made concessions.  If the employer failed to honor information requests where labor costs are a factor, it would be precluded from arguing that the union could not have made concessions.

 

What is troubling about Leibman’s process is that, in cases where the employer, in good faith, has concluded that the Union could not offer concessions sufficient to keep the work from being transferred, it would still have to deliver to the Union the bases for its decision.  If the Union then seeks the information that backs up the reasons, the Employer would be obligated to provide that information, some of which may be competitively sensitive, or be subject to a refusal to bargain charge.  What would follow could be protracted negotiations. The drag on the ability to make timely decisions could be significant and further justify the unwillingness of companies to put new work into unionized facilities.  Also, the reasons for a decision may implicate other strategic plans of the Company that would, if revealed, endanger other competitive edges that the Company is seeking to achieve, the relocation of work being just a piece in a much larger puzzle.

 

Leibman’s “musings” are additional indications that she is on a drive to broaden the powers of the National Labor Relations Board from an enforcement agency into a policy-making body.  If unchecked, Leibman will inject the Labor Board into the process of doing business to an unprecedented degree and far beyond what Congress intended when it passed the NLRA. 

 

It is clear from the preamble of the NLRA that Congress’s intent was that the Act should be, in both purpose and structure, reactive and remedial, not policy-making.  Even in the portion of the preamble that speaks about “encouraging the practice and procedure of collective bargaining,” the means of doing so in the context of remedying violations of the law and not by making policies:

 

It is hereby declared to the policy of the United States to eliminate the causes of certain substantial obstructions to the free flow of commerce and to mitigate and eliminate these obstructions when they have occurred by encouraging the practice and procedure of collective bargaining and by protecting the exercise by workers of full freedom of association, self-organization, and designation of representatives of their own choosing, for the purpose of negotiating the terms and conditions of their employment or other mutual aide or protection.  29 U.S.C.A. Section 151 (emphasis added)

 

Seeming to acknowledge the statutory limitation on the Board’s power, Leibman stopped short of suggesting that the failure of an employer to submit information about its decision to relocate work to the Union in advance of making the decision would constitute an independent violation of the Act.  Rather, she would give the failure to do so (and likewise the failure of a Union to propose concessions to stop the transfer) a preclusive effect in any later challenge to the action before the Board. 

 

These devices of choosing to enforce or not to enforce or to accept or not to accept certain defenses in enforcement proceedings are, in my view, attempts to achieve by circumspection what the law does not permit directly.  As such, the effort is not only intellectually dishonest, but also is reprehensible.  Either way, Employers need to be aware of yet another possible push by the current Labor Board to reshape the way American companies do business.  Curiously, this single-minded drive to deliver more power to unions at the expense of productivity and competitiveness may have the unintended consequence of driving more work away from unionized plants.  At a minimum, companies are well advised to do those things necessary to remain non-union to avoid the dilemma that the current National Labor Relations Board is creating for companies that have to recognize and deal with unions. 

 

 
 
 
 

THE RISKS OF LENIENCY: FORBEARANCE MAY BE COSTLY


On April 25, the Tenth Circuit Court of Appeals decided a “why now?” case with facts that are all too common for employers who are too lenient with problem employees.  The cause for the leniency – fear of litigation, good intentions, inattention – is irrelevant.  The fact that an employee is permitted to continue to underperform or engage in unacceptable conduct can cause real and expensive problems, not only while employed but also after the employer finally is driven to the brink and terminates the employment altogether. 

 

The Plaintiff in this case was an African-American who was employed in 1999.  Between the date of hire and mid 2007 when he was discharged, he had accumulated a record of twenty-three disciplines, five of which were for sexual harassment.  In December of 2006, the Plaintiff, with two co-workers, complained that there were too few African-Americans in management.  Within two months thereafter, the Plaintiff was disciplined twice more, one for unprofessional conduct in response to a supervisor’s instruction and the other, a final warning, for disrespect to a supervisor.  In addition, a co-worker requested to move away from the Plaintiff because of his constant criticism of female supervisors.

 

After the final warning, a human resource manager examined the Plaintiff’s entire work record and recommended that he be fired, both because the discipline was not having a corrective effect and because he would be a negative comparator in the event of a need to discharge another employee for conduct similar to that he had exhibited.  The recommendation was followed and the Plaintiff was discharged.

 

The Plaintiff’s allegation was that he was discharged in retaliation for his complaint about the lack of African-Americans in management.  His proof was that he had been disciplined often, including several final warnings, before his complaint and his conduct apparently had been tolerated by his employer because he was only disciplined.  After the complaint, however, the same kind of conduct resulted in his discharge.  The “Why Now” question, in his mind, was answered by the fact that he had lodged a race discrimination complaint.  In support, the Plaintiff cited a prior case in which the same court had found that the use of criticisms of recent performance as a basis for a discharge was suspect, requiring trial, because similar performance in the past resulted only in minor critiques.

 

The District Court didn’t buy the Plaintiff’s argument and granted Summary Judgment.  The Court of Appeals affirmed, distinguishing the case cited by the Plaintiff as having involved perceptions and judgments while many of the Plaintiff’s disciplines were due to objective behavior and complaints from other employees.

 

The employer in this case won, so to speak.  It still had the litigation costs associated with both the district court and court of appeals proceedings.  Also, a few different facts (e.g., the prior disciplines being opinion based) or a different court and the employer would have had the expense of a full-blown trial, in not liability predicated on the employer’s prior leniency.

 

I draw your attention to this case not because it established some great or new legal principle.  Rather, this case demonstrates the danger of what I see time and time again in my practice -- excessive leniency and misplaced problem avoidance – two conditions that cause employers unnecessary angst and expense.

 

There is a danger to discharging employees without due process, usually defined in terms of progressive discipline.  There is also danger in giving an employee too many breaks or delaying discharge decisions endlessly out of a fear of being sued.  Employees who are unsatisfactory must be told and helped to correct their problems.  However, when the employee demonstrates an inability or unwillingness to improve, the employment should be terminated.  Keeping an employee on too long risks keeping in the workplace someone who not only is or may become a mischief-maker, but also may become a negative comparator in other discharge situations.  Finally, keeping nonperformers or bad actors in the workplace will depress good workers and promote an environment of mediocrity, something no employer should desire.

 

One final note about mischief-makers.  Mischief-making is in the eye of the beholder and much of what some employers would see as mischief is actually protected by a law.  The National Labor Relations Board recently decided a case (Perexel) in which it found that an employer who preemptively discharged an employee out of fear that the employee would engage in union activity violated the National Labor Relations Act.  The violation, the Board majority held, was that the discharge was in retaliation for a possible exercise of protected rights.  Although the case is outrageous, it cannot be ignored.  The Perexel principle has to be factored into any future analysis regarding employee discipline/discharge.  Extending the principle a tad, it’s possible to imagine a court adopting a similar theory of retaliation in the civil rights, safety, wage and any other area of the law which protects employees who exercise the rights granted by that law. 

 

 

 
 
 
 

The Fierce Fight Over A Label: Is The Obama National Labor Relations Board Really A Pro-Union Activist?


The Fierce Fight Over A Label: 

 

Is The Obama National Labor Relations Board A Pro-Union Activist? 

 

 

On February 11, 2011, the House Subcommittee on Health, Education, Labor and Pensions of the Committee on Education and the Workforce conducted an oversight hearing on the National Labor Relations Board.  At the hearing, several witnesses accused the Board of overreaching its statutory authority, invading the province of Congress and abandoning long-established institutional norms.  In short, they labeled the Board a “Union Activist.”

Both the Chairman of the Board, Wilma Leibman, and Acting General Counsel of the Board, Lafe Solomon, shot back denials, citing as evidence that Republican controlled Boards in the past had often reversed precedents and, therefore, turn-about is fair play.  Besides, they both implied, their interpretations of the National Labor Relations Act we long needed corrections of prior perversities. 

The debate over whether the Obama Board is an activist for unions or an equalizing hand, is not the point and I leave that labeling to the reader.  Here is a brief review of recent Board decisions that, based on your point of view, either steadied or rocked the boat…or, as some would argue, punched a hole in the bottom.  Whether an activist or a correctionist, the Labor Board demands the attention of all employers, unionized and union free:

Atlantic Scaffolding:

 

The employer was a nonunion contractor working on Exxon property to erect scaffolding for the use of other contractors during a “changeover” at Exxon’s refinery.  The changeover cost Exxon “millions of dollars” a day due to lost production and utilized over a thousand contractor employees. 

Employees of the scaffolding employer were upset about a change in wage policies and, on the first day of the changeover, staged a work-stoppage to force a reversal of the policy.  Employees who went off duty from one shift stayed on the premises to support about a hundred others from the on-coming shift who refused to work.  The striking Employees stayed in the lunch tent of the employer inside the refinery for about an hour (three hours for the off-duty employees) until Exxon told them to leave, transporting them to one of the parking lots on Exxon’s property.  They remained for another hour in the parking lot, until Exxon told them again to leave.  The strikers went to a vacant area that was still on Exxon property.  Three hours later, about five and half hours after the stoppage had begun, Exxon told them to leave its property altogether and the strikers moved to a public park.  On the following day, some of the strikers returned to work, but seventy continued the work stoppage.  On the next day, two days after the strike had started, the employer, having concluded that the employees were giving no indication of returning to return to work, terminated the employment of the employees.  With the aid of a union, the terminated non-union employees filed an unfair labor practice charge, alleging that they were discharged because of their exercise of rights (a concerted refusal to work) protected by the NLRA.  The work stoppage idled hundreds of contractor employees, in addition to the strikers.

After trial, an Administrative Law Judge (ALJ) held that, while the initial stoppage and delivery of a petition of protest was an exercise of protected rights, at some point over the five and half hours of in-plant work stoppage, causing extraordinary damages to Exxon, the employees lost their protections of the law and were at risk of discharge.  The ALJ cited prior precedents back to 1986 which established that in-plant work stoppages were protected for only a “reasonable” period of time and that, in at least one circumstance, a stoppage of as little as thirty minutes was beyond reasonable and lost the protections of the Act.  Here, since the strikers were on the property of Exxon for more than five and half hours, the ALJ found, their stoppage was clearly beyond reasonable.

The Board reversed the ALJ and held that, because the strikers were peaceful and did not cause disruptions to the work beyond those resulting from their nonperformance of work, the employees had been engaged in protected activity for the duration of the stoppage and could not be terminated without violating the NLRA.  The fact that the strikers had timed their work stoppage for when it would have the maximum impact, said the majority, was consistent with a basic principle of the statute, i.e., “the right of employees to withhold their labor in seeking to improve their terms of employment, and the use of economic weapons such as work stoppages as part of the ‘free play of economic forces’ that should control collective bargaining.”  The Board expressly refused to balance the rights of the property owner and the strikers.  The nonunion employees were entitled to reinstatement with back pay, retroactive benefits and interest compounded daily.

Stevens Media, LLC, d/b/a Hawaii Tribune-Harold:

A supervisor notified an employee that he wanted to meet with him.  A colleague told the employee that the purpose of the meeting was to give the employee a warning and recommended a witness.  The employee requested a witness, but the supervisor denied the request.  The employee called his union representative and asked for guidance.  The union representative advised him to attend the meeting and to take notes.  At the suggestion of other employees, however, the employee brought into the meeting a concealed recording device and recorded the meeting.  When the supervisor later learned of the recording, he suspended the employee for “defiance.”  The employer then issued a rule barring secret recordings of work-related meetings.

The Board, reversing the ALJ, found that the employee’s suspension violated the NLRA because the employee’s conferring with other employees constituted concerted activity and the secret recording was not so egregious that it removed the protections of the law.  The Board also held that the rule was invalid because it was promulgated in response to the exercise of protected conduct.  Although not necessary to decide the case, the Board went on to hold that the rule itself (not just its promulgation in the face of protected conduct) was illegal as “overly broad,” in that it prohibited employees from making secret recordings of matters relevant to the workplace. 

Mandalay Bay Resort & Casino

 

A union petitioned to represent a group of about 140 employees.  The election results were 110 for the union and 123 against representation with 4 challenged ballots.  The union filed 19 objections, all of which were dismissed after trial by the Administrative Law Judge.  On appeal, the Board reversed the ALJ and ordered a new election.  The Board held that the objection that the Employer had solicited grievances and impliedly promised to resolve one of them had merit, dictating the need for a rerun election.

During the campaign leading to the election, two senior officers of the Employer met with employees for the purpose of understanding work related issues and to talk about the union organizing.  During the course of one of the meetings, employees complained about the policy of using part time employees to reduce overtime opportunities for full time employees.  The officers responded that the policy was a failed strategy and that the situation was being “addressed and looked at.”  There was no evidence that either of the officers indicated what, if anything, would be done.  Nevertheless, the Board majority found that the statements “implied” a promise of a remedy that would favor the employees and that, because the officers of the company had not had similar employee meetings prior to the election campaign, the employees would “tend to anticipate improved conditions of employment which might make union representation unnecessary.”  Therefore, the election was tainted and had to be rerun. 

Jurys Boston Hotel:

 

At the expiration of the term of a labor contract, employees filed a petition to decertify the union.  In the campaign period prior to the election, the Employer maintained a cooperative position with the Union and even wrote to the employees expressing the fact that its relationship with the Union was positive.  In addition, the Employer instructed it supervisors to take neutral if not positive line concerning the Union in their conversations with employees.

Prior to the election, but not prior to the filing of the decertification petition, the Union filed unfair labor practice charges concerning seven rules of conduct that it stated violated the law, including an overbroad no solicitation rule, a prohibition against loitering on the property and a grooming standard that prohibited employees from wearing union buttons while at work in the hotel.  All of the rules were old and predated the initial recognition of the Union and the successful negotiation of the labor contract.  When the Union filed its charge, the Employer issued a memo to all employees that withdrew the rules and stated that no rule was intended to interfere with any employee’s legal right to engage in union activity.

The Union lost the election 47-46.  After trial, the Administrative Law Judge held that, while the rules violated the Act, no employee had been disciplined for disobeying any of them during the election period, and that there was no evidence that any employee had even read the rules, let alone that any of the rules had an impact on the election. 

The Board reversed the ALJ, holding “the three rules in question, individually and together, had a reasonable tendency to chill or otherwise interfere with the prounion campaign activities of employees during the election period.”  In making its decision, the Board gave no weight to the fact that the Employer had disavowed the rules prior to the election and had told employees that it did not want any rule to inhibit any employee from engaging in union activity.  The Board also gave no weight to the undisputed finding by the ALJ that the rules had no impact on the election.

Parexel:

 

A nurse complained about her wage rate.  When she continued to complain to her supervisor, the Employer terminated the employee because it was concerned that the employee would cause trouble in the workplace.  The employee had not discussed her complaint with any other employee, although another employee had told her that she and a relative had gotten raises. 

After trial, the ALJ held that the employee had acted on her own behalf and had not engaged in any concerted activity protected by the NLRA; therefore, her discharge did not violate the law.  The Board reversed the ALJ, stating that the discharge had been “pre-emptive,” because the employer was concerned that the employee may engage in concerted activity and that such “pre-emptive” actions violate the law.

American Medical Response:

 

The Company’s social media policy prohibited disparaging remarks about the company or any supervisor.  After an argument with a supervisor that led to discipline, an employee posted on her Facebook page that her supervisor was a “psycho.”  The employee was fired.  The Board issued a complaint against the employer, alleging that, because the comment related to the workplace, the employee’s conduct was protected by the NLRA.  The case was settled in February.

Reuters:

 

A manager of the Company solicited from employees suggestions on how to make the workplace better.  The local shop steward, using Twitter, replied that “One way to make this the best place to work is to deal honestly with Guild members.”  The supervisor met with the employee and told her that the comment was offensive.  The supervisor told the Board that she had felt “intimidated” by the supervisor.  The Board issued a complaint, alleging that the employee’s protected conduct was infringed by the supervisor.

Eliason & Knuth:

 

A union had a dispute with a non-union building contractor.  The contractor was doing work for both a restaurant and a hospital.  There or four union representatives held banners approximately four feet by twenty feet as close as fifteen feet in front of the restaurant and one thousand feet in front of the hospital.  In addition, union representatives conducted hand billing at both locations.  The banner in front of the restaurant said in large letters “Don’t Eat RA Sushi” and at the hospital “Shame on [name of hospital]”.  Flanking the words in the banner were the words “Labor Dispute” in smaller letters.  The handbills, but not the banners, stated that the "labor dispute" was with a non-union contractor and not the restaurant or the hospital themselves.

To threaten, coerce or restrain a company with which the union does not have a direct dispute in order to force the company to stop doing business with an employer with which the union has the direct dispute violates the secondary boycott provisions of the NLRA.  The Board held, however, that, since the banners were being held stationary, they were no more confrontational than are banners on the Fourth of July or which preceed a high school marching band.  Therefore, the union was simply informing the public of a dispute with the non-union contractor and did not threaten, coerce or restrain either the restaurant or the hospital to force them to stop dealing with the contractor.   

New Star General Contractors, Inc.

 

A union had a dispute with two general contractors.  During the dispute, the union wrote letters to the contractors’ customers asking them not to do business with the contractors.  The union also used large banners at 19 different sites where the contractors were working and, in some locations, put the banners in front of gates reserved for employees of the contractors’ customers. 

The Board found the conduct was legal and did not constitute “signal” picketing to the employees of the customers urging them not to work.  Therefore, it was not an effort to coerce the customers to stop doing business with the contractors.

Dana Corporation

 

The employer agreed with a union to be neutral to and cooperate with the union in its efforts to organize the employer’s employees.  In partial fulfillment of this commitment, the employer provided the union with the names and addresses of the employees and told its employees that it could work positively with the union.  In addition, the employer agreed to recognize the union based on a card check.  In return, the union agreed that any first contract would be for at least four years, would keep healthcare costs at competitive levels, would allow for mandatory overtime, would permit the company’s team system and would have bargaining differences resolved by an arbitrator, not a strike.

The Board found that the agreements did not constitute “dealing” with the union, but constituted a mere “framework” for a possible agreement.  Therefore, said the Board majority, the employer did not violate the provisions of the law that prohibit an employer from dealing with a union that has not proven that it represents a majority of the employees.  In effect, the Board approved of bargains by unions to obtain employer neutrality and cooperation agreements, giving the green light to further “corporate campaign” coercive conduct by unions to silence employers.

Boeing:

 

The Board has recently alleged that Boeing violated the law when it chose to put a production line in a non-union plant because of a history of multiple and long strikes at its unionized plant.  Simply, Boeing did not want the risk of production delays (and customer penalties) caused by work stoppages.  The Board asserts that a decision based on a history of work stoppages is in retaliation for the exercise of the protected right to strike.  Apparently according to the Board, Boeing is required by law to continue to operate in a manner that gives its unions the greatest leverage possible over its business.

General Counsel Actions:

 

On October 2, 2010 and November 1, 2010, Acting General Counsel Lafe Solomon issued two directives to the Regional offices of the Board.  In the first, he instructed the Regions to be on the alert for alleged illegal conduct by employers during union organizing and, when suspected, to seek permission to file for federal court injunctions requiring, for example, the interim reinstatement of an employee who was allegedly discharged for engaging in union activity. In his instruction, Mr. Solomon told the Regions to respond quickly and effectively to nip illegal employer conduct in the bud. 

In the second memo, the General Counsel expanded the kinds of cases that justify injunction applications to include such things as interrogations, surveillance, promises, threats and soliciting of grievances for the purpose of resolving them to affect union activity.  In addition, Mr. Solomon detailed several remedies, in addition to injunctions, that should be used in these “nip-in-the-bud” cases:

·                     Requiring a Notice of employee rights, including the right to form and join unions, to be read to the assembled employees by a senior officer of the employer or by a Board agent with the senior officer standing next to him/her.

·                     Giving the union access to company bulletin boards

·                     Requiring the employer to provide the contact information of all employees to the union

·                     Giving the union organizers access to the employer’s premises during working hours to speak with the employees

·                     Giving union organizers the right to attend and speak at any group meeting held by the employer during working hours to discuss union representation.

·                     Giving union organizers the right to deliver a pre-election speech in the workplace to the employees

************************

Arguing about labels clouds the issue.  The Board may be engaging in pro-union activism or just leveling the playing field.  The label is in the eye of the beholder.  Whatever they are doing, however, the rules are changing and employers must be alert to the changes that affect them. 

In acknowleging this caution, it cannot be overlooked that we have yet to see promised decisions on the following issues:

·                     Restricting no solicitation/no distribution/no access and social media rules

·                     Narrowing the definition of supervisor

·                     Reducing the size of appropriate units to match the extent of union support

·                     Inclusion of agency employees into bargaining units of host company employees

·                     Posting the rights of employees to engage in union organizing and other concerted activities

·                     The legality of rules of conduct that “may” possibly “chill” union activity (e.g., confidentiality of wages and other terms and conditions of employment and disrespectful, harassing, disparaging, damaging and abusive conduct directed toward the company or any employee, to name a few) 

 

Anyone want to guess how those decisions will come out? 

 

Often ignored is the fact that the Board’s interpretations of the law are always retroactive.  For example, if the Board speculates that a particular rule may possibly chill union activity and, therefore, finds the rule unlawful, that rule will be found to have always been unlawful and any other employer with that same rule will be at risk for actions it took to enforce the similar rule, even though those actions predated the Board’s decision.  The Board doesn't say  “in thirty days this rule will be illegal.”  The employer always acts in its own peril when it comes to the Labor Board.

 

It's wise, therefore, for every employer to examine its workplace rules and practices in light of not only what the Board does but also what the Board may do.  That’s not an easy exercise, but, on the risk/benefit continuum, the exercise is worth it.

 
 
 
 

LOOSE LIPS MAY SINK DREAMLINER


National Labor Relations Board files complaint against Boeing for decision to put some Dreamliner production in a non-union plant[Read More]
 
 
 
 
 

James Redeker

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