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Unions face increased exposure for DFR charges

The NLRB General Counsel issued a memorandum directing the Board’s enforcement personnel to be more aggressive in prosecuting charges against unions under the National Labor Relations Act sec. 8(b)(1)(A), which imposes a Duty of Fair Representation (“DFR”) on unions. Under Sec. 8(b)(1)(A), workers who are represented by a union may file a DFR charge alleging that the union failed to represent them adequately. To prove a DFR violation, the worker must show the failure to represent was arbitrary, discriminatory or in bad faith. Historically, union have been able to assert, as a defense, that their failure was “mere negligence.”

The NLRB General Counsel’s memo keeps in place the “mere negligence” defense but offers a tighter definition for what does and does not constitute “mere negligence.” The memo orders NLRB staff to now follow this tighter definition.

Under the tighter definition, unions face increased exposure for DFR charges. What was once “mere negligence” will no longer be tolerated by the Board.

The memo provides two specific examples:

  1. “(H)aving lost track, misplaced or otherwise forgotten about
    a grievance, whether or not (the union) had committed to pursue it,” will no longer be considered “mere negligence,” unless the union proves it did so in spite of its previously established and routinely used should be required procedural systems to process such concerns (i.e., despite proof of the prior “existence of established, reasonable procedures or systems in place to track grievances”).
  2. “(A) union’s failure to communicate decisions related to a grievance or to
    respond to inquiries for information or documents by the charging party” will generally not be considered “mere negligence.” “Regions issuing a complaint in these cases should argue that a union’s failure to return phone calls or emails or other efforts by the charging party to inquire about a grievance or attempt to file one, constitutes” a DFR violation.

The General Counsel is aware that the above-described approaches may be
inconsistent with the way the Board and Regional Directors have historically interpreted duty of fair representation law. Going forward, Regions are directed to apply the above principles to Section 8(b)(1)(A) duty affair representation cases, issue a complaint where appropriate, and make arguments consistent with those set out above.

Source: NLRB General Counsel Memorandum ICG 18-09 (9/14/18).

NLRB proposes rule to reverse Obama-era Joint Employer standard

As explained in earlier posts, the Board’s Obama-era decision in Browning Ferris, revising its Joint Employer standard, has proven exceptionally controversial. At the close of 2017, the Board voted, in Hy-Brand, to reverse Browning Ferris, but that decision was rendered unenforceable when Board Member Emanuel was ruled to have had a conflict.

Now, the NLRB has issued proposed regulations that will do what it would have done by decision in Hy-Brand, namely, return the Board to the pre-Browning Ferris Joint Employer standard, which had required proof that a purported joint employer has actually exercised “direct and immediate” control. Under this new rule, if made final, even contract provisions that reserve to a company the possibility of control would not be sufficient to establish a joint employer relationship, nor would limited or routine involvement in operational matters. Rather, to be a joint employer under the proposed rule, a company would have to be proven to have actively involved itself in hiring, firing, discipline, supervision and the direction of workers.

The Joint Employer doctrine has importance for any company that uses independent contractors, which is virtually every company, and has been especially significant to companies whose very business models involve the use of contractors, including franchisors and gig economy companies.

Source: NLRB, “The Standard for Determining Joint Employer Status,” 83 Fed.Reg. 46681 (9/14/18).

Troubled by NLRB Member Emanuel’s recusal in Hy-Brand?

If, like many, you are troubled by the recent recusal of NLRB Member Emanuel from the Hy-Brand case, you might want to read an article in the latest newsletter by the ABA Labor and Employment Law Section.

What’s Hy-Brand? Hy-Brand Industrial Contractors, 365 NLRB No. 186 (2015), was a decision by the NLRB under President Trump. It overruled Browning-Ferris Industries, 362 NLRB No. 186 (2015), which had been a decision by the NLRB under President Obama. In Browning-Ferris the Obama Board expanded the joint employer standard. The case set off a political firestorm. Thus it was no surprise when the Trump Board, in Hy-Brand, reversed Browning-Ferris, returning the Board to its prior approach to joint employers.

How did Member Emanuel end up being recused, and what did that mean for Hy-Brand? After Hy-Brand was announced, the Board’s own Inspector General called a foul on the play. The Inspector General opined that Member Emanuel should have recused himself from the decision because, it contended, he had a conflict of interest. With his vote subtracted, the Board was left split 2-2, effectively nullifying Hy-Brand and keeping Browning Ferris in place.

What was Member Emanuel’s conflict? This is where the case takes a sharp turn around President Trump’s own policies. Member Emanuel himself had no actual conflict. But for the Trump Administration’s own policies, the Trump Board’s vote in Hy-Brand would have stood. The conflict was imputed to Member Emanuel because he, like many NLRB Members, came from a large law firm. On the union side, it’s common for NLRB Members to come from large unions. It’s not uncommon therefore for Board Members to be called upon to decide cases that involve legal issues their prior law firm/union/company may have argued. In fact, it’s not just not uncommon, it’s expected. Nonetheless, the Inspector General imputed a conflict to Board Member Emanuel because his prior law firm had handled a matter involving the joint employer issue. It should be noted it did not involve the same parties, or the same evidence, simply the same legal issue. Normally that would not be enough to create a conflict, and even now it arguably should not be enough, but in this particular instance, at this particular time, it was, because, the Inspector General pointed out, the Trump Administration has required its appointees to agree to a voluntary ethics pledge (Executive Order 13770) that prohibits them from participating in “any particular matter involving specific parties that is directly and substantially related to (their) former employer or former clients” during the first two years of government service.

Source: “The NLRB Recusal Standard: How Will Hy-Brand, The Inspector General, and a Federal Regulation Affect Employees and Employers?,” G. Enis and S. Hamilton, American Bar Association Labor and Employment Law Section newsletter, vol. 46, no. 4 (Summer 2018).

Want to read about the NLRB’s recent ruling on micro-units?

Check out my comments and in general this interesting article in Colorado Law Week regarding the NLRB’s recent decision involving Boeing and so-called “micro units.”

Want to read about the NLRB’s upcoming ruling on emails?

The NLRB is currently considering whether and how to reverse Purple Communications, the decision that presumptively permitted employees access to company email systems for use in unionizing efforts. Read my comments in this great article on Colorado Law Week.

Union Leader Salaries Soar

Issued just before the Supreme Court’s Janus decision, a survey of union leader salaries is a stunning bookmark to the Court’s blockbuster decision holding that public employees cannot be required to pay “fair share” fees, much less dues, to unions. The survey is based on public filings by the unions. It lists total compensation packages for the 10 highest paid union presidents, ranging from $449,852 to $792,483, which the survey notes is several times higher than the average salary for CEOs, $196,050, as reported by the U.S. B.L.S. Statistics like this are likely to continue to fuel right-to-work legislation and Janus-related litigation across the country.

Will the Supreme Court’s recent blockbuster in Janus apply to private employers?

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Employers have begun arguing that the Supreme Court’s recent blockbuster decision in Janus should be extended to private employers. In Janus, the Supreme Court ruled government workers cannot be required to pay “fair share” fees, much less union dues. The decision will have a huge impact on labor in America. Effectively, Janus converted government workforces into right-to-work workplaces. The decision is anticipated to strip organized labor of billions of dollars in revenues, much that had previously, in no small part, been used towards political contributions. The Supreme Court reasoned that requiring workers to pay even “fair share” fees, much less dues, was ultimately requiring them to support the unions’ political activities; workers should be free, as part of the constitution speech rights, to decide whether or not to support the unions’ political activities.

Janus was decided under the First Amendment, which only applies to government action. Private workers do not have First Amendment rights in their workplaces, at least as against their employers.

However, one employer is arguing that Janus should be extended to cover private workers nonetheless because, the employer argues, when the NLRB and courts attempt to enforce union requirements for dues and service fee collection, then the NLRB and courts are themselves the government actors. In other words, while the First Amendment does not limit a private employer’s ability to curtail worker speech, it limits the NLRB and courts’ ability to curtail worker speech. The employer already has a pending appeal before the Ninth Circuit, where it has just asked the Ninth Circuit to consider this new argument based on the Supreme Court’s Janus ruling (Communication Workers of America, AFL-CIO v. NLRB v. Purple Communications, Inc., Case Nos. 17-70948, 17-71062, and 17-71276).

The issue is no doubt going to be heavily litigated, but it appears the employer has the better side of this particular argument. If — as we now know from Janus — the Constitution’s speech rights in the First Amendment protect workers against compelled union contributions, they arguably constrain not only governmental employers, but all other governmental actors, including the NLRB and courts, from stripping employees, even private employees, of those same rights.

Want to hear my thoughts on recent developments at the Supreme Court?

Great morning today discussing the resignation of Justice Kennedy and other recent developments.

Source: 850 KOA, Colorado’s Morning News.

Is this the end of unions in America? The Supreme Court’s “fair share” ruling in five questions

The Supreme Court ruled that unions cannot charge government workers a “fair share” representation fee, much less union dues. The decision may well be beginning of the end for America’s unions, at least as the political and social juggernauts that we’ve come to know.

  1. What’s a “fair share” fee? A “fair share” fee is like dues, but is less than dues. It’s just the portion of dues that represents the union’s cost of representing the workers. A “fair share” fee is often also referred to as a representation fee. Under this ruling a union cannot charge government workers either dues or even just a “fair share” fee.
  2. What was the Supreme Court’s reasoning? Because the First Amendment protects a person’s right to choose whether or not to speak in support of various things. The fact that a union might want to use money to support its political agenda for example might be important for the union, it might even be very helpful to the workers, but particular individuals may choose not to support that speech. Therefore the Supreme Court held that a union can’t force government workers to give it money if the worker doesn’t want to support the union’s speech.
  3. Why does this apply only to government workers? This case was decided under the First Amendment, which only applies as to governmental action. The First Amendment does not protect workers at private companies. This doesn’t mean private-company employees have no rights, they just don’t have First Amendment rights. Instead, they always have the right under federal labor law to refuse to pay full “dues” and instead can pay the reduced “fair share” representation fee, and in some states with right-to-work laws, they can even refuse to pay “fair share” fees.
  4. Why is this case so important? Many commentators think this case signals the end of unionism as America has known it for more than a century. Union representation has been steadily declining for decades. Unions represent only 34% of the government workforce and 6% of the private workforce, with many such private-company workers at construction companies that do work for the government. This case — having given government workers the right to refuse to pay even “fair share” fees — is likely to cause a precipitous decline in the revenue streams for unions overall — the Supreme Court noted these fees have aggregated to “billions of dollars” over the years. The decline in revenue streams is in turn likely to result in a greatly reduced ability for unions overall to support political movements.
  5. Can this decision be overruled by Congress? No, only the Supreme Court can decide what the Constitution does and does not permit, so only a future Supreme Court could reverse this decision.

In announcing this highly controversial 5-4 decision, the majority recognized the impact its ruling is likely to have on unions.

We recognize that the loss of payments from nonmem­bers may cause unions to experience unpleasant transition costs in the short term, and may require unions to make adjustments in order to attract and retain members. But we must weigh these disadvantages against the consider­ able windfall that unions have received under Abood for the past 41 years. It is hard to estimate how many bil­lions of dollars have been taken from nonmembers and transferred to public-sector unions in violation of the First Amendment. Those unconstitutional exactions cannot be allowed to continue indefinitely.

In contrast, the dissent noted that, in order to reach this result, the majority had overruled more than 40 years of precedent.

There is no sugarcoating today’s opinion. The majority overthrows a decision entrenched in this Nation’s law—and in its economic life—for over 40 years. As a result, it prevents the American people, acting through their state and local officials, from making important choices about workplace governance. And it does so by weaponizing the First Amendment, in a way that unleashes judges, now and in the future, to intervene in economic and regulatory policy.

Right or wrong, this case is now the Supreme Court’s ruling and likely to have a major impact on unionism in America.

Source: Janus v. AFSCME, case no. 16-1466 (6/27/18).

Joint Employer rule coming from NLRB?

The NLRB’s approach to the Joint Employer doctrine has proven exceedingly controversial. The NLRB’s approach has sparked similar controversy in both the courts and at the D.O.L. Soon, more fuel will be added to the political fires. The N.L.R.B. announced its intent to publish a proposed joint employer rule. What’s it likely to say? Stay tuned. IT is likely to continue the Board’s rollback against the Obama-era Board’s Joint Employer approach. Some recent developments at the Board suggest some possibilities. The draft rule is expected this summer. At that point, the Board advises it will follow formal administrative rulemaking procedures, which will include a comment period.

Source: NLRB news release (6/5/18), disclosing an otherwise unpublished letter by NLRB Chairman to certain Senators.

Board steers a sharp 180 in the application of Section 7 to handbooks and policies

During President Obama’s administration, the NLRB substantially expanded its scrutiny of handbooks, workplace rules and workplace policies that, it felt, conflicted with Section 7 of the National Labor Relations Act. Section 7 is the part of the Act that permits both unionized and non-unionized workers to act together in concert to further their wages, hours and working conditions.

On June 6, 2018, NLRB General Counsel Peter B. Robb announced the Board will no longer lean towards finding violations of Section 7 in workplace policies. The General Counsel’s memo implements the Board’s own decision in The Boeing Company, 365 NLRB No. 154 (Dec. 14, 2017), where it reversed much of the doctrines associated with the Obama-era Board’s Section 7 analysis and the General Counsel’s previous memo in December 2017.

Now the Board is directed to no longer err on the side of finding a violation when it determines language is merely on its face, without evidence of actual anti-union animus, potentially ambiguous.

Regions should now note that ambiguities in rules are no longer interpreted against the drafter, and generalized provisions should not be interpreted as banning all activity that could conceivably be included.

NLRB General Counsel advised Board personnel that, now, the following types of policies should be considered presumptively lawful:

  • Civility codes (for example, policies that prohibit language or behavior that is offensive, rude, discourteous, negative, annoying, disparaging, condescending, etc.)
  • Rules that prohibit photography/recording in the workplace
  • Rules that prohibit insubordination or non-cooperation
  • Rules that prohibit disruptive or boisterous conduct
  • Rules that protect confidential, proprietary or customer information
  • Rules that prohibit defamation or misrepresentation
  • Rules that protect company logos and I.P.
  • Rules that prohibit speaking on behalf of the company without authorization
  • Rules that prohibit disloyalty, nepotism or self-enrichment

NLRB General Counsel advised Board personnel that, now, the following types of policies will no longer be considered presumptively unlawful, but rather will now require individualized analysis of the particular circumstances of each case:

  • Rules that prohibit conflicts of interest “that do not specifically target fraud and self-enrichment”
  • Broad confidentiality rules that merely protect “employer business” or “employer information”
  • Anti-disparagement rules that prohibit criticizing the company only
  • Rules that broadly prohibit the use of a company’s name
  • Rules that restrict workers’ ability to speak to media or third-parties on their own behalf
  • Rules that prohibit lawful off-duty conduct that is otherwise protected
  • Rules that broadly prohibit making any kind of “false or inaccurate statements”

Finally, NLRB General Counsel identified the following as rules that remain presumptively unlawful:

  • Rules that prohibit employees from discussing their wages, hours and working conditions
  • Rules that prohibit employees from disclosing their own wages, hours and working conditions to the media
  • Rules that prohibit employees from joining “outside organizations”

NLRB General Counsel also cautioned that the Board’s historical (pre-Obama era) approach to the following types of policies remains unchanged:

  • Solicitation/distribution policies
  • Workplace access policies
  • Uniform policies (to include rules re buttons, tshirts, etc.)

Source: NLRB General Counsel Memorandum GC 18-04 (6/6/18).

NLRB holds hotel owner REIT liable as a “statutory employer” for otherwise lawful lawsuit against union

Companies that own properties, such as hotels, may find themselves being damaged by the activities of unions who represent or seek to represent workers on the property, even workers who are employed by other companies. Such property owners may have legal rights at-issue and may sue unions and workers for violation of those rights. However, in response, unions and workers can file charges at the NLRB alleging that the real reason for the lawsuit was to retaliate for lawfully protected concerted activities.  That kind of NLRB charge is often called a Bill Johnson charge after the Supreme Court case recognizing the theory behind such a charge. The NLRB will permit a Bill Johnson charge even when it was proven in the underlying lawsuit that the union had violated the property owner’s rights. In a recent decision, the NLRB revisited multiple doctrines involved with that kind of scenario.

As an initial matter, the hotel owner argued before the NLRB that it was not subject to the National Labor Relations Act because it was not the “employer” of the workers, it had no collective bargaining relationship with their union. Indeed it was undisputed that the company, being a REIT (Real Estate Investment Trust), could not have employed the workers. The Board rejected the argument finding that the owner was a “statutory employer,” subject to the NLRA, along with the operator that actually employed the workers. First the Board held the owner had “a significant financial interest in the hotel’s profitability.” More importantly the operator was an affiliate of the hotel owner; it was owned by two of the same individuals who were owners in the REIT/property owner. And, perhaps most importantly to the Board, the REIT/property owner had a management agreement with the operator, in which it required the operator to consult with it over personnel matters, including wages.

Next, the Board rejected the hotel owner’s argument that it had a meritorious basis for its lawsuit against the union. The Board explained that whether the owner’s lawsuit against the union had a “reasonable basis” or not was simply not an issue in the case. The Board said that its “reasonable basis” test did not apply where, as here, the owner’s lawsuit had been directed specifically at activity protected by the NLRA. Here, the REIT/property owner’s lawsuit was, the Board held, entirely focused on the union’s boycott and related activities and speech by the Union and the workers. In so holding, the Board distinguished cases where the underlying lawsuit had targeted unprotected activities, such as defamatory statements made with malice, threats to the public order, or violence. Finally the Board held, that even if the “reasonable basis” test applied, it would not find the underlying lawsuit as having had a reasonable basis.

The decision is a sharp reminder that the NLRB may punish companies who exercise their otherwise lawful right to pursue litigation against a union. The Board’s ruling that a “reasonable basis” for the underlying lawsuit is not a defense arguably has increased the potential for future Bill Johnson charges.

Source: Ashford TRS Nickel, LLC, 366 NLRB No. 6 (2/1/18).

Google memo litigation continues, on two fronts

As previously reported on this blog, the NLRB recently cleared Google of charges that it had allegedly violated Section 7 of the National Labor Relations Act by discharging the author of a controversial memo that attempted to explain his view that men are biologically more fit to be engineers than women. The NLRB held that, while some aspects of his memo might have been protected under Section 7 — a part of the NLRA that applies to both unionized and non-unionized workplaces — there were parts that stereotyped women and warranted Google’s decision to “nip in the bud” (quoting the NLRB General Counsel) his sexist communication.

The NLRB General Counsel’s decision, though, doesn’t end the litigation. There are now at least two separate lawsuits on-going: One by the memo’s author, James Damore, and another by a critic of Damore’s views, Tim Chevalier.

Both are former employees, terminated by Google for their speech involving Damore’s memo. In his memo, Damore advocated that Google had a culture of discrimination against white men and conservatatives, despite his view that men were in fact biologically better fit to be engineers at the highest level of the tech industry. In contrast Chevalier advocated verbally, through conduct, by email, on social media and on Google’s internal systems, that the Damore memo was “misogynistic,” that it was hostile to protected classes including gender, sex and race, and that it reflected, he alleged, a larger culture of hostility, including bullying, at Google on those same bases.

Damore’s lawsuit includes allegations, under California’s anti-discrimination laws, that Google discriminates against conservatives, Caucasians and men. Damore seeks to represent a class of such individuals against Google.

Chevalier’s lawsuit, also filed under California state law, asserts that he too was terminated for his political speech, including his activities to oppose not only Damore’s memo but also the Trump Administration’s politics and to protect the rights of minorities and women and rights associated with gender preference and sexual orientation. Also, Chevalier, a transgendered man, alleges his termination was linked to his efforts to protect related to sexual orientation and gender preference.

Both complaints are lengthy and warrant additional review by interested readers. Those are just some of their allegations. The merits of Mr. Damore and Mr. Chevalier’s complaints will be litigated, but the filing of their lawsuits illustrates how labor laws like the NLRA interact with employment laws like those at-issue in these lawsuits. An employer can comply with one set of laws and run afoul of another.

Sources: Duvalier complaint; Chevalier complaint.

NLRB clears Google, signals more employer-respectful approach to discipline of workplace misconduct

In a shift from recent NLRB decisions holding employers liable under the National Labor Relations Act’s Section 7 for disciplining employee misconduct that is offensive, disrespectful and harassing, the NLRB General Counsel recently cleared Google of charges that, by disciplining an employee for having written an offensive memo, it had somehow violated the Act.

Section 7 is a part of the National Labor Relations Act that applies to both unionized and non-unionized workforces, so this decision is of equal interest to companies without unions as to companies with unions representing their workforces.

In this case, Google’s employee famously wrote a memo that sought to explain why men received more favorable treatment than women in Google’s high tech workplace. The memo was considered by many to be highly offensive and received substantial national press. Included in his memo were stereotyping comments about women, such that women are more prone to “neuroticism” and therefore less able to work in a stressful environment and that more men score in the “top of the curve” than women.

Although the employee “cloaked” his memo in “science,” especially biology, quoting the NLRB, the Board’s General Counsel refused to engage on the so-called science, instead finding that the stereotyping comments were offensive and specifically offensive in a gender-specific manner, implicating the nation’s laws against sex discrimination. The Board’s General Counsel noted that the memo triggered internal complaints of sexual harassment and multiple female engineering candidates withdrew their applications.

The Board’s General Counsel also refused to condone the parts of the memo that may have been protected under Section 7, which protects an employee’s efforts to further his workplace’s wages, hours and working conditions.

(W)hile much of the Charging Party’s memorandum was likely protected, the statements regarding biological differences between the sexes were so harmful, discriminatory, and disruptive as to be unprotected.

In reaching that conclusion, the Board’s General Counsel noted that Google had drafted the employee’s termination notice to expressly say he was not being let go for any lawful aspects of his memo, but rather specifically and only for “(a)dvancing gender stereotypes.”

Finally the Board rejected the argument that the memo was merely speech and that, as such, it alone may not have been a violation of the anti-discrimination laws.

(E)mployers must be able to “nip in the bud” the kinds of employee conduct that could lead to a “hostile workplace,” rather than waiting until an actionable hostile workplace has been created before taking action.

It is this “nip in the bud” comment that is mostly likely to be cited by future employers. Recognizing that an employer has the right to “nip in the bud” misconduct seems to be a reversal of recent Obama- era Board decisions.

Source: NLRB Advice Memorandum, case no. 32-CA-205351 (1/16/18).

NLRB likely to rescind Obama-era expedited election rules

In a continuing trend of reversing Obama-era precedents, the Trump Board has signaled it will soon be rescinding the prior administration’s 2014 election rules. Those rules govern the election for (or against) unions to be recognized as a group of workers’ exclusive bargaining agent. The Obama-era rules greatly expedited the timeline for such an election and included a number of substantive changes that many commentators contend infringe on worker rights and employer rights. These controversial rules are known as — depending on the speaker’s perspective — the “expedited” or “ambush” or “quickie” election rules.

The NLRB posted a Request for Information on its website and in the Federal Register, December 14, 2017, inviting comment on three questions involving the rules:

  1. Should the 2014 Election Rule be retained without change?
  2. Should the 2014 Election Rule be retained with modifications? If so, what should be modified?
  3. Should the 2014 Election Rule be rescinded? If so, should the Board revert to the Representation Election Regulations that were in effect prior to the 2014 Election Rule’s adoption, or should the Board make changes to the prior Representation Election Regulations? If the Board should make changes to the prior Representation Election Regulations, what should be changed?

The deadline for responses is February 12, 2018. Responses may be submitted at that website (limit 250 characters), where they will be posted immediately.

Source: NLRB Request for Information regarding expedited election rules.

 

NLRB reverses micro-unit rule

Continuing its trend of reversing Obama-era precedents, the NLRB has reversed 2011’s Specialty Healthcare, which had recognized the possibility of a union representing only a portion of a bargaining unit, i.e., a micro-unit. Micro-units were favored by unions when they felt they were able to persuade a majority of the smaller group to vote Yes for union representation, even though the union might not be successful in convincing the entire bargaining unit to so vote. It was seen as a way for the union to gain a foothold in an otherwise unreceptive workforce. In this case, the Board reversed Specialty Healthcare.

Source: PCC Structurals, Inc., 365 NLRB No. 160 (2017).

NLRB reverses Obama-era joint employer doctrine

Continuing its trend of reversing Obama-era NLRB decisions, the Trump Board has reversed one of the most controversial, the Board’s 2015 decision, Browning-Ferris Industries, in which the Board had held that mere proof of indirect or even potential control was sufficient to create a joint employer relationship. In this decision, Hy-Brand Industry Contracts, Ltd., the Board returns to requiring proof of actual control by the putative joint employer.

The impact of the Board’s decision on the pending legislation regarding the Joint Employer doctrine, previously reported in this blog is yet to be determined.

Source: Hy-Brand Industry Contractors, Ltd., 365 NLRB No. 156 (12/14/17).

UPDATE: On February 26, 2018, the Board vacated the foregoing decision in Hy-Brand due to a purported conflict of interest bearing upon one of its members. On June 5, 2018, the Board announced it will, instead, issue a proposed rule addressing the Joint Employer doctrine. On June 6, 2018, the Board then refused to reinstate the foregoing decision, apparently leaving the issue instead to be determined as part of the forthcoming rulemaking process.

NLRB General Counsel issues memo outlining likely reversals to Obama-era precedents

As previously reported here in this blog, the Trump Board (NLRB Boards are often colloquially but not pejoratively referred to by the President during their term) has begun overruling Obama-era precedents. Further reversals are anticipated. Curious which Obama-era NLRB precedents are likely to be reversed?

NLRB General Counsel Robb issued a controversial memo, shortlisting the cases he thinks most warrant attention. Indeed to call it a shortlist is a stretch. The General Counsel lists 26 categories, that range from employee access to email, to protections for section 7 rights, obscene and harassing behavior, off-duty access to property, the Weingarten right to have a representative present, rights of employees during contract negotiations, successorship and of course the joint employer doctrine, unilateral changes consistent with past practice, information requests during the processing of a grievance, dues check-offs, remedies, deferral, and, well, the list goes on, as will employers’ need to stay tuned to forthcoming developments at the Board.

Source: NLRB General Counsel Memorandum GC 18-02.

Republican-majority NLRB begins overruling Obama-era precedents

As reported here, the Trump administration, earlier this year, completed nominations to the NLRB sufficient to constitute a Republican majority of the Board. As predicted, the new Republican-led Board has begun overruling Obama-era precedents.

The first case, UPMC, involves the Board’s procedural requirements for accepting settlement agreements. Historically an administrative law judge (ALJ) at the Board was authorized to accept settlement agreements if “reasonable” under a set of factors articulated in Independent Stave, 287 NLRB 740 (1987).

In 2016, the Obama Board (NLRB Boards are often colloquially and non-pejoratively referred to by the last name of the President at their time) rejected the Reasonableness standard, saying instead an ALJ was authorized to accept settlement agreements only if they provided a “full remedy” for all violations alleged in the complaint. United States Postal Service, 364 NLRB No. 116 (2016).

What’s the difference between the Reasonableness standard and the Full Remedy standard? The facts of this case, UPMC, illustrate. Here, a complaint was filed against UPMC and its affiliate, Presbyterian Shadyside, alleging violations committed by Presbyterian Shadyside. The allegations alleged that UPMC was liable as a joint employer for Presbyterian Shadyside’s violations. Presbyterian Shadyside negotiated a settlement in which it promised to fully remedy any violations; however, the settlement required the Board to dismiss the joint employer allegations against UPMC. Instead of agreeing to be held a joint employer, UPMC promised to guaranty Shadyside’s performance of the settlement.

The ALJ accepted the settlement, but the Board’s General Counsel and the Charging Party objected to how he did so, arguing that UPMC should have been required to admit to being a joint employer, instead of a mere guarantor, in order to provide a “full remedy.” The ALJ held, and in this case, the Board agreed that the settlement with UPMC being a guarantor provided the same effective relief and that it did so more quickly than continuing to litigate the joint employer issue.

UPMC’s remedial guarantee is as effective as a finding of single-employer status.  As noted above, when a parent company is found to be a single employer with its subsidiary, the parent company is liable for the subsidiary’s unfair labor practices to the same extent as the subsidiary. The practical aim of the General Counsel’s single-employer allegation in this matter, then, is to hold UPMC responsible for Presbyterian Shadyside’s unfair labor practices along with Presbyterian Shadyside.

In overruling the Obama Board’s “full remedy” standard, the Board gave a preview of how it will overrule other decisions in the coming months and years, saying the Obama-era case had “imposed an unacceptable constraint” and “was an ill-advised and counterproductive departure from longstanding precedent.”

Furthermore, we overrule Postal Service, and we agree with the dissenting views of Chairman (then-Member) Miscimarra in that case, who pointed out that Postal Service imposed an unacceptable constraint on the Board itself, which retained the right under prior law to review the reasonableness of any respondent’s offered settlement terms that were accepted by the judge. We believe the “full remedy” standard adopted by the Board in Postal Service was an ill-advised and counterproductive departure from longstanding precedent. As illustrated by the instant case, adhering to the Postal Service standard would predictably cause incalculable delay in resolving the alleged violations, while potentially jeopardizing the prospect of obtaining any remedy against UPMC. Today, we return to the Board’s prior practice of analyzing all settlement agreements, including consent settlement agreements, under the “reasonableness” standard set forth in Independent Stave, 287 NLRB 740 (1987)

While UPMC involves a relatively dry procedural issue, it foreshadows a wave of decisions by which the Trump Board will overrule a number Obama Board decisions.

Source: UPMC, 365 NLRB No. 153 (12/11/17).

Interested in my thoughts on the Gothamist shutdown?

Honored to be featured in Doug Chartier’s article about the recent Gothamist shutdown.

Source: Gothamist Shutdown Raises Questions – Law Week Colorado

House passes Joint Employer bill

In previous posts, this blog has reported on legislative efforts to limit the NLRB’s joint employer approach. The House has voted to pass its bill, HB 3441, which now proceeds to the Senate, where supporters will need to find at least 8 Democrats to overcome anticipated filibuster.

Source: E:\BILLS\H3441.RH

NFL Players Association files NLRB charge

As anticipated, the NFL Players Association has filed a unfair labor practice (ULP) charge in the on-going protest-kneeling debate. The charge will now proceed to investigation by the NLRB.

 

Joint Employer bill moves forward, towards an unclear future

The House Education and the Workforce Committee approved the Save Local Business Act (H.R.3441) moving it forward towards a potential floor vote before the House. As explained in a previous post, the Bill will reverse the NLRB’s 2015 joint employer standard. No sister bill has been introduced in the Senate, and it is unclear whether such a bill could muster sufficient votes to withstand a filibuster in the Senate.

Source: H.R.3441 – 115th Congress (2017-2018): Save Local Business Act | Congress.gov | Library of Congress

NLRB majority shifts with confirmation of William Emanuel

On September 25, 2017, the Senate confirmed on a 49-47 vote the nomination of William Emmanuel to the National Labor Relations Board, creating a Republican-majority Board for the first time since 2007. The current Board-constituency will be short-lived as Chair Miscimarra has announced he will retire when his term expires December 16, 2017. He recently announced a desire to see the Board, before then, begin reversing multiple Obama-era rulings and initiatives. Expect to see an action-packed two and a half months at the NLRB.

Interested in the legal ins and outs of the NFL’s kneeling crisis?

Interested in the legal ins and outs of the NFL’s kneeling crisis. Here’s an article: Bloomberg Law – Document – Fired for Kneeling? Not So Fast, Daily Labor Report (BNA)

Bottom line: It depends on the NFL Player Association’s CBA language. If the NFL wants, yes, they could fire a player (or discipline them), but its CBA (collective bargaining agreement) says, according to this article, that the NFL must prove “personal conduct reasonably judged by Club to adversely affect or reflect on Club.” So far, owners and players have supported kneeling, which makes it difficult (to impossible) to prove it is conduct harmful to a club.

What’s interesting about this article is that the reporter not only found the NFL’s CBA, but also the NBA’s, and the NBA’s actually has a national anthem clause: “Players, coaches and trainers are to stand and line up in a dignified posture along the sidelines or on the foul line during the playing of the National Anthem.” Arguably that means the NBA’s CBA doesn’t require as high a showing, and any kneeling would seem to be contrary to its national anthem clause, whether it harms a club or not.

Wondering about baseball? Check out the article’s discussion of the MLB’s CBA.

One thing not discussed in the article, if the NFL were to go to court and ask a judge to issue an order requiring players to stand, then arguably the players’ First Amendment speech rights would be triggered. While the NFL itself is not subject to the First Amendment (the First Amendment only limits what the government can do), it would trigger the First Amendment if it asked a judge to issue an order limiting speech. Until then it’s a matter of collectively bargained rights (and plain business power).

Congress Takes Shot at Browning-Farris – Law Week Colorado

Interested in reading Bill Berger‘s thoughts about Congress’ efforts to reverse Obama-era expansions of the Joint Employer doctrine, especially H.R. 3441 (which if passed would be the Save Local Business Act)? Check out the August 7, 2017 issue of Law Week Colorado. If passed, the Act would tighten the application of the Joint Employer doctrine (back) to requiring evidence of actual control by the purported joint employer in cases involving the National Labor Relations Act or the Fair Labor Standards Act.

Source: Congress Takes Shot at Browning-Farris – Law Week Colorado

Pre-Trump NLRB scores post-Trump win at D.C. Circuit

In 2011, the NLRB announced, in Specialty Healthcare, that a union can ask to represent only some of a company’s workers. This so-called “micro-unit” approach has been heavily criticized as permitting unions to cherry-pick a group of pro-union workers within a group of workers who otherwise would vote “No” on having a union. It has been seen as a way for a union to slide its nose into a group that would otherwise want nothing to do with that union. It has further been criticized as a bureaucratic change announced by the Board with no support in the language of the National Labor Relations Act and in direct contradiction of decades of precedent.

Despite that criticism, the D.C. Circuit recently held for the Board, ruling that the Board’s new “micro-unit” approach is within the existing language of the NLRA and was therefore a lawful approach available to the Board. Under this micro-unit approach, an employer can only defeat a union’s attempt — can only require that the vote be held among all the workers in a unit — by showing that the smaller group is “truly inappropriate” and specifically that the workers deserve a vote because they share “an overwhelming community of interest.”

The decision is most likely to face its next hurdle, which is likely to be an insurmountable hurdle, if and when a the next micro-unit case comes before the Board on review. Likely within the next few months, the Trump Administration will have seated its nominees to the Board. If a pre-Trump Board was able to reverse course and adopt micro-units, a post-Trump/Republican-majority Board is able and widely expected to reject micro-units and return Board law to pre-Specialty Healthcare.

Source: Rhino Northwest, LLC v. NLRB

Trouble for the NLRB’s joint employer doctrine? 

The NLRB famously expanded its joint employer doctrine in its 2015 Browning-Ferris decision. There, the Board effectively eliminated the requirement that a company have actual control to be a joint employer, in other words, it eliminated its decades old “direct and immediate” control requirement. Instead it can be enough now — at least according to the Board — if the company has “reserved” some form of control, that isn’t exercised, even if “indirect.” The Board’s ruling in Browning-Ferris is currently on appeal at the DC Circuit.

Unwilling to wait for a decision, Congress is considering a House Bill, the Save Local Business Act, that would jettison the NLRB’s “reserved” or “indirect” standard and reinstate the “direct and immediate” standard, not only for purposes of the NLRA (the federal labor law governing union relatioins) but also the FLSA (the federal wage-hour law).

Here the DC Circuit considered a slightly different aspect of the NLRB’s new joint employer doctrine (its “share or codetermine” standard). While the DC Circuit went out of its way to say it was expressing no opinion on the Browning-Ferris issue (“direct and immediate”), it held the Board had improperly laxened its “share or codetermine” caselaw, reversed and remanded the case to the Board to reconsider.

Source: NLRB v. CNN Am. Inc.

Right-to-work legislation coming to you soon?

In a heavily watched and strenuously litigated case, the Seventh Circuit upheld Wisconsin’s right-to-work statute. The decision is likely to embolden efforts designed to bring right-to-work to every state. Currently, almost thirty states have some form of right-to-work legislation in place. Wisconsin‘s, which follows on the heels of Indiana‘s, were two of the strongest. Both prohibited not only any requirement that a worker become a union member, but also that they be required to pay any dues, or even fees. Both were upheld. Federal legislation is pending that would establish right-to-work in every state.

Source: INTERNATIONAL UNION OF OPERATING ENGINEERS LOCAL 139 v. SCHIMEL, Court of Appeals, 7th Circuit 2017 – Google Scholar

Individual employee non-competes struck for failure to bargain with the workers’ union

Unionized employers may not implement unilateral changes to wages, hours and working conditions without first providing the union notice and an opportunity to bargain. A union is not required to bargain.

In a previous post this blog summarized a Sixth Circuit case, Detroit Edison, that held an employer, who gave notice, was not required to negotiate with a union that merely griped about changes without actually requesting negotiations.

In this case, the company failed to give notice. Instead the company simply started requiring union-represented employees to sign a confidentiality agreement that contained non-competes, invention assignment language, non-interference language, and non-solicits as to both employees and customers. While this type of agreement is not, itself, unusual in the American workplace, unionized employers need to remember that unions are the exclusive bargaining agent of represented workers, so the company must give notice of changes to wages, hours and working conditions, and if negotiations are requested, negotiate over the changes with the union.

Worse, this agreement contained an at-will disclaimer. Again, an at-will disclaimer is common in the American workplace, but here it contradicted the “just cause” discharge clause that the union had bargained for in its collective bargaining agreement with the company.

The D.C. Circuit had no difficulty upholding the NLRB’s decision against the company.

Furthermore, the Court affirmed the Board’s holding that the non-solicits were themselves violative of NLRA rights (under section 7 of the NLRA). (Section 7 rights apply even to employees who are not represented by a union.) Under section 7, employees have the right to engage in protected concerted activity to further their wages, hours and working conditions. Doing so through a union is just one way they may exercise this right. Another is to solicit support from a company’s customers by way of a customer boycott. Here the customer non-solicit prohibited employees from “directly or indirectly” soliciting customers “to terminate or otherwise alter his, her or its relationship with the Company.” This aspect of the Court’s ruling appears highly controversial. It remains to be seen if other courts will interpret section 7 so broadly as to bar a customer non-solicit like this.

The case was Minteq International, Inc. v. NLRB, case no. 16-1276 (D.C. Cir. 4/28/17).

Union gripes held not a request to bargain

Unionized employers may not implement unilateral changes to wages, hours and working conditions without first providing the union notice and an opportunity to bargain. A union is not required to bargain at that point. Unions often do not; many unilateral changes are everyday and, for unions, often involve no issue warranting negotiation.

In this case, the union, through its president, expressed discontent with a change, condescendingly threatening the company’s labor relations director with “a board charge honey.” He said he would “have to come to (company headquarters) for this one.” While he followed through with his threat to file a board charge, he did not actually request to negotiate, schedule a time to come to, much less go to corporate headquarters.

While a divided NLRB held that his expressions of discontent were sufficient to trigger negotiations, the Sixth Circuit disagreed. “These comments expressed disapproval, to be sure; but that establishes only protest,” the Court held.

The pertinent question is whether, in light of the record as a whole, they clearly signaled a request to bargain. On that point, they were at best ambiguous rather than clear.

The case was Ohio Edison Co. v. NLRB, case no. 15-1783 (6th Cir. 2/10/17).

NLRB overruled by D.C. Circuit

The D.C. Circuit overruled the NLRB in a case involving a broad range of issues, including Weingarten rights, retaliation, surveillance and coercion.

The court’s analysis began with the Weingarten issue. Weingarten is a case that held a union-represented employee may demand a representative be present at any interview where the employee anticipates discipline may follow. Weingarten allows an employer three options in response to such a demand: (1) grant the request and permit the representative to be present then hold the interview, (2) cease the interview or (3) permit the employee to choose between ceasing the interview or proceeding without a representative. The third option allows an employee to choose to continue the interview if he thinks that what he has to say will be helpful to himself, or to waive the interview entirely and thereby allow the employer to make decisions without the benefit of his information. In this case, when the employee requested a Weingarten representative, the employer attempted to find the representative, even asking HR for help finding the rep. When they could not find the representative, they gave the employee the third option, and he chose not to be interviewed. In this case, the D.C. Circuit held the company met its Weingarten obligations.

At that point, the company put the employee on paid leave pending investigation. The NLRB had held that doing so was retaliatory, but the D.C. Circuit — preserving for employers the important tool of being able to suspend pending investigation — reversed the Board, holding that doing so was not retaliation.

Thereafter, the employee dawdled in a work area before leaving. A supervisor observed him there and instructed him to leave. Here too the D.C. Circuit reversed the Board, holding that it was not an act of prohibited surveillance, but was rather a “routine” observation.

As the employee was told to leave, he was told to stop his discussion with a co-worker – a discussion that centered on the employee’s criticism of management. The D.C. Circuit reversed the Board here as well, holding this was not coercion of protected speech or protected conduct. “As noted above, given the circumstances in this case, it was perfectly reasonable for the Company to instruct (the employee) to leave the workplace pending investigation of his alleged wrongdoing.”

The case illustrates the importance of understanding Weingarten in unionized workforces. The Weingarten issue became the foundation for all of the Court’s analysis. The case also illustrates, in all workplaces, unionized or not, the proper use of suspensions pending investigation.

The case was Bellagio v. NLRB, ____ F.3d ___ (4/25/17).

Second Circuit OK’s profanity in the workplace

In a controversial case, the Second Circuit affirmed the NLRB’s decision that profanity – profanity any reasonable employer would arguably not permit in its workplace – must be permitted in the workplace. This stunning decision was rendered under Section 7 of the National Labor Relations Act, which is a section of that law that applies to non-union as well as unionized employers. Section 7 permits employees to engage in speech to further their wages, hours and working conditions.

In this case, the speech was designed to solicit support for a union in its organizing campaign. An employee felt his supervisor spoke to him harshly, so, on a break at work, he used his phone to post on Facebook text that included saying that supervisor “is such a NASTY MOTHER F*CKER don’t know how to talk to people!!!!!! F*ck his mother and his entire f*cking family!!!! What a LOSER!!!! Vote YES for the UNION!!!!!!!” (Asterisks added.) What most employers and management-side counsel would find so striking about this language is its combination of purely gratuitous profanity – the graphic cursing adds nothing to the message’s content – but its attack on the supervisor’s mother and “entire” family. Still, when the employee was discharged, and a charge filed at the NLRB, the Board and now the Second Circuit held against the company,

How could both the Second Circuit and the NLRB find this language not only acceptable but legally protected? One unusual fact in the case is perhaps significant and may limit this decision to this particular workplace: The court said that there was “widespread profanity in the workplace, including the words ‘f*ck’ and ‘mother*cker,’ among other expletives and racial slurs.” (Asterisks added.)

Because the profanity occurred in social media, the Second Circuit reiterated the NLRB’s multi-factor test for social media postings:

The “totality of the circumstances” test for evaluating an employee’s use of social media may consider the following factors: (1) any evidence of antiunion hostility; (2) whether the conduct was provoked; (3) whether the conduct was impulsive or deliberate; (4) the location of the conduct; (5) the subject matter of the conduct; (6) the nature of the content; (7) whether the employer considered similar content to be offensive; (8) whether the employer maintained a specific rule prohibiting the content at issue; and (9) whether the discipline imposed was typical for similar violations or proportionate to the offense. Pier Sixty, LLC, 2015 WL 1457688, at *3.

The Second Circuit’s conclusion suggests this case is limited to its unique facts, making it the “outer-bounds” (as the Second Circuit, itself, called the decision) of this seemingly already stretched reading of Section 7. The court described its own decisions, as follows:

In sum, Pier Sixty has failed to meet its burden of showing that Perez’s behavior was so egregious as to lose the protection of the NLRA under the Board’s “totality‐of‐the‐circumstances” test.   However, we note that this case seems to us to sit at the outer‐bounds of protected, union‐related comments, and any test for evaluating “opprobrious conduct” must be sufficiently sensitive to employers’ legitimate disciplinary interests, as we have previously cautioned.50 We have considered all of Pier Sixty’s objections to enforcement and have found them to be without merit.

The case was NLRB v. Pier Sixty, LLC (2nd Cir. 4/21/17).

DOL Persuader Rule blocked

The DOL’s persuader rule, which would have extended the longstanding persuader rules to cover attorneys providing legal advice, has been blocked by the courts. Whether it will survive numerous lawsuits, much less a Republican Congress and Trump Administration, is doubtful.

Nat’l Fed’n of Independent Bus. v. Perez , N.D. Tex., No. 16-cv-066, 11/16/16.

 

 

NLRB General Counsel appointment held invalid

The Supreme Court held that former NLRB General Counsel Lafe Solomon served in violation of the Federal Vacancies reform Act after his appointment by President Obama without Senate confirmation, from 1/5/11 until 10/29/13.

The decision puts at risk all bargaining units certified by the NLRB and all rulings on ULP charges, during that time.

The case was NLRB v. SW General, Inc., — U.S. — (3/21/17).

Supreme Court review over benefits liability likely in union jurisdictional disputes

Sometimes, companies sign collective bargaining agreements (CBA), not realizing that each promises the same work to different unions. In this case, the employer allegedly signed one CBA that promised forklift and skidster work to the Operating Engineers and another CBA that promised the same work to Laborers. This can create a jurisdictional dispute; in other words, it can lead the two unions to argue over the work.

Under section 10(k) of the National Labor Relations Act (NLRA), the National Labor Relations Board (NLRB) has authority to decide which union gets the work in a jurisdictional dispute.

In this 10(k) case, the Board decided that the Operating Engineers not the Laborers had the better claim to forklift and skidster work. Despite the Board’s ruling, the Laborers sued the company for benefits under its collective bargaining agreement. In effect, the Laborers argued that the Operating Engineers could have the work, but the company should have to pay benefits to both unions’ trust funds. The law that governs liability for benefits is the Employee Retirement Income Security Act. The Laborers argued that the Board’s 10(k) authority only extends to determinations of which union has the better claim to the work under the NLRA, not to which union is entitled to benefits under ERISA.

The Circuit Courts are split on the issue. The Third, Ninth, District of Columbia and now Sixth Circuits hold that the Board’s 10(k) ruling governs the ERISA claim, meaning the losing union has no claim to the work under the NLRA or for benefit payments under ERISA. The Seventh Circuit has held otherwise.

The split in Circuit Courts foretells possible Supreme Court review, especially because, here, even as it joined the majority of other Circuits, the Sixth Circuit did so over a strong dissent.

Employers with multiple CBAs should carefully review the way each of their agreements describes covered work. Overlapping descriptions should be clarified.

The case was Orrand v. Hunt Construction Group, Inc., — F.3d — (6th Cir. 2017).