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By: Marjorie Soto, Esq.

After being reportedly close to nominating retired Jones Day partner Roger King for the role, the White House announced last Friday that President Donald Trump will nominate Peter Robb, a management-side labor and employment attorney from Vermont, as the new NLRB General Counsel. If confirmed, he will replace former President Barack Obama’s current appointee, Richard F. Griffin, Jr., whose term expires this November.

Since 1995, Robb has been with Downs Rachlin Martin, a Vermont-based law firm. Robb represents corporations in all aspects of labor and employment law. Robb has recently published articles critical of the NLRB’s rules designed to speed up the representation election process and of the Board’s recent decisions that have struck down common workplace rules. Robb has experience working for the NLRB. He worked as a NLRB field attorney and Chief Counsel to former Board Member Robert Hunter.

This announcement comes as the Board commences to change to a Republican-majority Board– the first time this has occurred in over a decade. As a result, we expect to see policy shifts in the next upcoming years.

 

  By:  Timothy M. Hoppe, Esq.

Seyfarth Synopsis: With the NBA season opener just over a month away, at least one team could be getting an unexpected influx of free agents. In Minnesota Timberwolves Basketball, LP, 365 NLRB No. 124 (2017), the Board recently held that the production crew responsible for operating the Timberwolves’ center court video display were employees under the National Labor Relations Act and could form a bargaining unit to negotiate the terms and conditions of their employment.

Facts

The Minnesota Timberwolves, like most professional sports teams, has a large video display in the center of its arena to broadcast live game footage, player statistics, replays, advertisements, and fan favorites like the kiss cam during games. Behind all of these visual effects are sixteen crewmembers who operate video cameras in the arena and direct what video gets displayed during the games.

The Timberwolves maintain a roster of about 51 crewmembers with the skills to operate the video display. The team circulates a game schedule at the beginning of each season and the individual crewmembers decide which, if any, games they will work. Most perform production work for other entities when not working for the Timberwolves. For each game, the team sets the crewmembers’ start time and pays a set fee, which varies based on the game and position crewmembers hold. The team also provides the crewmembers with a basic game plan prior to each game outlining the timing of some of the promotions it wants to broadcast. But the crew maintains significant control over what makes it onto the video display during the game.

In February of 2016 the crewmembers sought to enlist an agent, the International Alliance of Theatrical Stage Employers, to form a union. The team appealed to its referee, the NLRB, claiming that the crewmembers where independent contractors under the Act and, therefore could not unionize. The Regional Director, whistled the crewmembers’ play dead, holding that they were not employees. The crewmembers sought a booth review from the Board.

Board’s Ruling

The Board has long applied common law agency principals to decide if an employee-employer relationship exists. It considers eleven “non-exclusive” factors, none of which is “decisive:” (1) the extent of control by the employer; (2) whether the individual is engaged in a distinct business; (3) the level of supervision from the employer; (4) skills required in the occupation; (5) who provides the tools, equipment, and work place; (6) the length of employees’ employment; (7) method of payment; (8) whether the work is part of the employer’s regular business; (9) whether the parties believe an independent contractor relationship exists; (10) whether the principal is in business; and (11) whether the employee renders services as part of an entrepreneurial business with opportunity for gain or loss.

Two of the Board’s pro-union members used these sprawling factors to overturn the Regional Director’s decision. They acknowledged that crewmembers exhibited some characteristics of independent contractors. The crew retained control over which games they worked, did not receive Timberwolves’ credentials, handbooks or written guidelines, and completed W-9 and 1099 forms for tax purposes. But the majority held that the amount of control the team exerted over the crewmembers, along with the “essential component” crewmembers provided to the team’s business, rendered the crew employees under the Act. The majority emphasized that the team provided guidance to the crew prior to and sometimes during games, and characterized running the video board as “plainly among the [Team’s] central business concerns.” It also noted other things, like the team-dictated start time of each member’s shift, the team-set pay for each game, and the team-provided tools necessary to perform the crewmembers’ jobs.

Chairman Miscimarra cried foul. Also emphasizing the control factor, he noted that the relevant issue was not whether the Timberwolves helped shape the final product that was displayed on the video board by providing a broad outline to the crew; such high level control is a hallmark of any independent contractor relationship. Instead, what should matter is the control over the details of the work. And in this case, he would have held the possession arrow pointed decidedly toward independent contractor status. During each game, crewmembers determine things like which video feeds to broadcast, what shots to capture, and other aspects of the live coverage. Chairman Miscimarra also rejected the majority’s view that the crewmembers’ function was central to the team’s business; without the crew, the team would still play basketball in the arena and the television broadcast would proceed uninterrupted. In Chairman Miscimarra’s opinion, these facts, when combined with things like the crew’s ability to choose their schedules, their per-game payment structure, and lack of any meaningful supervision from the team, “substantially outweighed” any factor supporting employee status.

Employer Takeaways

The decision does not dramatically change the Board’s employee/independent contractor jurisprudence. Instead, it highlights the perils of asking any referee, whether basketball or judicial, to apply an eleven factor test to anything. It is inherently unpredictable and open to the whims of hometown (for Basketball) or political party (for the Board) biases. Nevertheless, it is unlikely that even a more reasonable Board will completely abandon a multi-factor employee test. Therefore, the Timberwolves decision should act as a reminder to employers to carefully analyze their independent contractor relationships and ensure that the contractors retain as much control over the terms and conditions of their employment as business necessity permits.

 

By: Howard M. Wexler, Esq.

As we previously reported (http://www.employerlaborrelations.com/2017/06/29/management-side-attorney-nominated-for-final-seat-on-nlrb/), President Trump nominated two candidates for vacancies on the five-member National Labor Relations Board – William Emanuel and Marvin Kaplan.  The Senate approved Mr. Kaplan to fill one of the vacancies on August 2, 2017 by a 50-48 vote, but has yet to schedule a date to vote on Mr. Emanuel’s appointment.

Just as the Board was about to have its full complement of five members, Chairman Philip Miscimarra, in a letter to President Trump, announced that he will leave the Board when his term expires on December 16, 2017.  Accordingly, even if Mr. Emanuel is confirmed by the Senate, the Board will be back down to four members and President Trump will have the opportunity to appointment another Board member (and Chairperson) to replace Mr. Miscimarra.   In addition,  the term of Richard F. Griffin Jr. as the Board’s general counsel is set to expire in December as well. A Republican appointment to fill his position is likely to follow.

While employers hoped for sweeping changes at the Board with the election of President Trump, especially in connection with some of the Board’s more controversial rulings, such as those dealing with class action waivers in employment agreements, use of an employer’s email systems for union purposes, and unlawful handbook rules, we’ve previously cautioned our readers (http://www.employerlaborrelations.com/2017/05/25/change-to-occur-slowly-at-nlrb/) that such change tends to move more slowly at the Board.  With Chairman Miscimarra’s Beatles-esque decision to “say goodbye as [Mr. Kaplan and Emanuel] say hello“ we expect it to take even longer for the Board to restore some balance to decisions reached over the past eight years that many believe have been the most pro-union in the agency’s history.  Stay tuned!

 

 

By:  Bryan Bienias, Esq.

Seyfarth Synopsis: The D.C. Circuit Court of Appeals applied a broad definition of who constitutes a statutory “guard” under the NLRA, finding that security technicians at two Las Vegas casinos were guards who could not be represented by a non-guard union.

Hotels and other employers may now have an extra layer of security against union intrusions into the workplace: security technicians.

In Bellagio v. NLRB, the DC Circuit Court of Appeals recently held that security technicians at two Las Vegas casinos are “guards” who performed “an essential step in the procedure for the enforcement of the employer’s rules” and could not be represented by a non-guard union under the National Labor Relations Act.

The technicians at each casino were responsible for maintaining comprehensive security camera coverage, controlling access to all sensitive areas, maintaining alarm systems, and assisting with “special operations” to help spy on fellow employees suspected of misconduct. The techs did not, however, carry weapons or handcuffs, patrol the resorts, restrain or physically confront guests or swindlers, or monitor security footage for wrongdoing.

The Board found that the techs did not have sufficient authority to “enforce” company rules required to be “guards” under the Act, stating their duties involve merely installing and maintaining security and surveillance cameras and equipment.

Reversing the Board, the Court found that the Board took “an overly narrow view” of the NLRA’s guard provision. The Court noted that the Board relied too heavily on evidence that techs didn’t “perform traditional functions” like carrying a gun and making rounds, gave too little weight to the critical role the techs play in deterring criminal activity at the casinos, failed to account for security needs of highly-sophisticated casinos that house priceless valuables and protect the safety of “revelrous guests,” and ignored the “crucial fact” that the techs help enforce rules against their coworkers, particularly during special operations.

Employer Takeaway

The ruling could significantly impact the organizing activities of non-guard unions seeking to represent security techs or similar workers at casinos, banks, or other industries utilizing cybersecurity and other modern security measures. Employers should analyze whether any security or surveillance technicians or specialists perform “an essential step” in the procedure for enforcing rules and be prepared to challenge representation petitions by traditionally non-guard unions seeking to include such employees in the bargaining unit.

NLRB By: Samuel Sverdlov, Esq.

Seyfarth Synopsis: President Trump has nominated a candidate for the final remaining vacancy on the five-member National Labor Relations Board, who, if confirmed, would give the Republicans a 3-2 majority on the NLRB.

Five months after his inauguration, President Donald Trump has finally nominated a candidate for the remaining vacancy on the five-member National Labor Relations Board. The nominee, William Emanuel, is a management-side labor attorney with decades of labor and employment experience. President Trump’s nomination comes just days after the President nominated another Republican lawyer, Marvin Kaplan, to the other vacancy on the NLRB. Currently, the Democrats enjoy a 2-1 majority on the NLRB. However, if confirmed, Emanuel and Kaplan would join fellow Republican, Philip Miscimarra, in a 3-2 majority for Republicans on the NLRB.

President Trump’s recent nominations should give hope to private-sector employers. The business community has roundly criticized the Obama Board for a number of rulings that they argued overreached the Board’s authority, resulting in unreasonably pro-union decisions. With a Republican majority, the NLRB is poised to take a more employer-friendly approach. This is especially critical for employers as the Board may see fit to evaluate high-profile issues such as graduate student employment status, “micro-unit” issues, and “joint employer” relationships.

Emanuel’s nomination would be for a five-year term set to expire on August 27, 2021. At present, no confirmation hearing dates have been made public, and it is unclear whether the candidates will be confirmed before the August recess. As always, we will continue to update you with more information as it becomes available.

Dept. of LaborBy: Ashley Laken, Esq.

Seyfarth Synopsis: Trump Administration DOL issues notice of proposed rulemaking to rescind Obama Administration DOL’s long-embattled final persuader rule. The proposed rule is open for public comments for 60 days.

Last year, we reported extensively on the Department of Labor’s final persuader rule, which was scheduled to take effect on July 1, 2016 and would have required certain public reporting by employers and their consultants (including attorneys). However, as we reported in late June 2016, a federal district court in Texas issued a nationwide preliminary injunction preventing the rule from taking effect.

The most recent development in this saga took place just over a week ago, with the Trump Administration’s DOL issuing a notice of proposed rulemaking to formally rescind the Obama Administration DOL’s final persuader rule. In the notice of proposed rulemaking, the DOL said that it is seeking to rescind the rule so that it can consider in more detail the interaction between the new categories of “indirect” persuasion that were created by the rule and the role of attorneys in advising their clients. The DOL also said that it is proposing to rescind the rule so that, if it elects to change the scope of reportable activity beyond what has been in place since 1962, it can provide as thorough an explanation of its statutory interpretation as possible. The DOL also said that it is proposing to rescind the rule in light of “limited resources and competing priorities.”

The proposed rule was opened for public comments last Monday, and the comment period will last for 60 days. We plan to submit comments in a letter to the DOL, and we would be more than happy to include our readers’ comments in our letter. If you would like us to incorporate any particular points, please reach out to your favorite Seyfarth labor lawyer.

Cellular Phones By: Andrew R. Cockroft, Esq.

Seyfarth Synopsis: On June 7, 2017, the Board held that in order to comply with the Board’s Election Rules, an employer may need to search the phones of supervisors to identify the phone numbers of eligible voters, even if said supervisors have not been deemed “supervisors” within the meaning of the NLRA.

Under the Board’s Election Rules employers are now required to supply a plethora of information to a union prior to a representation election, including “available home and personal cellular (‘cell’) telephone numbers of all eligible voters.” For some employers, this information may be readily accessible and it can be produced to the union with ease. For others, finding the cellular phone numbers of eligible voters may not be so easy.

The Board’s recent ruling in RHCG Safety Corp., 365 NLRB No. 88 (2017), makes that process even more difficult. The Board held that if the employer does not maintain a database containing the cellular phone numbers of eligible voters, but knows that a workplace supervisor maintains the contact information of eligible voters on his cellular phone, the employer is required to ask and (if that fails) search the supervisor’s phone.

In RHCG Safety Corp., when a representation election resulted in a loss for the union, the union objected to the results of the election on the grounds that the employer failed to provide eligible voters’ cellular phone numbers as part of the voter list.  The employer argued that it had no obligation to include the phone numbers because it did not maintain its employees’ phone numbers in its computer database. Consequently, the phone numbers were not “available” to the employer within the meaning of the Board’s rules.

The Board, without citing to any precedent for support, rejected this argument. According to the Board, the phone numbers were “available” to the employer because it knew that its workplace supervisors maintained those numbers on their own phones.

Chairman Miscimarra dissented and elaborated on several problems with the Board’s newfound interpretation of “available” and the obligations imposed on employers.

First, he explained that such a rule would be nearly impossible to comply with given that employers have two days after entering into a stipulated election agreement to provide the list.

Second, under the new Election Rules, an employer might not know who constitutes a supervisor under the Act, because the Rules require the parties to wait until after the election to resolve most questions of voter eligibility and supervisory status. Accordingly, employers won’t know whether they can ask certain individuals to provide it with the phone numbers of the bargaining unit employees.

Chairman Miscimarra explained how employers are placed in a Catch-22:

  • If an employer believes that an employee is not a supervisor and therefore refrains from demanding a search of his or her phones for coworkers’ personal phone numbers, and if the union loses the election, the union is likely to object to the election results by contending that the employee is a supervisor and that the voter list erroneously omitted employees’ personal phone numbers stored on the supervisor’s phones.
  • If the employer believes that the employee is a supervisor and requires a search of his phones resulting in the discovery of numerous coworker personal phone numbers, and if the union loses the election, the union is likely to object to the election results by contending that the employee is not a supervisor, and the compelled search of the employee’s phones and forced disclosure of coworkers’ personal phone numbers constituted unlawful surveillance or other unlawful interference under Section 7 of the Act.
  • Employer Takeaway: This decision highlights how difficult it is to comply with the Election Rules, and in particular, with providing a complete list of all phone numbers. An employer faced with an upcoming election and the possibility of asking its supervisors to search their phones (or any other devices) for eligible voters’ contact information, should seek legal advice before doing so.
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Gavel By: Christopher Lowe, Robert T. Szyba, Kaitlyn F. Whiteside

Seyfarth Synopsis: The New Jersey Appellate Division reinstated plaintiff’s state law discrimination and retaliation claims, finding the claims were not pre-empted by Section 301 of the LMRA.

In a published opinion issued on May 9, 2017, the three-judge panel of the New Jersey Appellate Division held that a union member’s Law Against Discrimination (“LAD”) and Workers’ Compensation Law (“WCL”) claims were not preempted by Section 301 of the Labor Management and Relations Act (“LMRA”), despite the presence of an applicable collective bargaining agreement (“CBA”) and potential CBA-based defenses available to the employer.

The plaintiff was employed as a commercial truck driver, and was a member of Teamsters Local Union No. 813.  Following a workplace injury, he was cleared for light duty work, so long as it did not involve commercial driving. The plaintiff then filed a workers’ compensation claim with the New Jersey Department of Labor and Workforce Development, Division of Workers’ Compensation.

Three months after filing the workers’ compensation claim, the company asked plaintiff to leave work, and by letter to the union, indicated that plaintiff would need to be recertified for duty as required by Department of Transportation (“DOT”) regulations before returning to work.  The company scheduled an independent medical examination, but the plaintiff declined to undergo the exam, and therefore, was not returned to work.

The union filed a grievance challenging the company’s failure to reinstate the plaintiff.  The grievance proceeded to arbitration, and was denied by the arbitrator who concluded that reinstatement would require examination and recertification pursuant to the DOT regulations.

The plaintiff then sued in New Jersey Superior Court alleging unlawful discrimination under the LAD and retaliation under the WCL. Concluding that the claims were pre-empted, the trial judge dismissed the complaint for lack of subject matter jurisdiction.  The plaintiff appealed.

The question before the Appellate Division was whether the trial judge correctly concluded that the LAD and WCL claims were pre-empted under Section 301 of the LMRA, which pre-empts claims that require an interpretation of a collective bargaining agreement.

The court first looked to the elements of the plaintiff’s claim that the company retaliated against him based on his workers’ compensation claim, which required showing that (i) he made, or attempted to make, a claim for workers’ compensation, and (ii) he was discharged for making that claim.

According to the court, under U.S. Supreme Court precedent in Lingle v. Norge Div. of Magic Chef, 486 U.S. 399 (1988), each of these is a “purely factual inquiry,” and therefore, requires no interpretation of the CBA.  Plus, plaintiff did not make any mention of any provision of the CBA in his complaint.  So, his WCL claim was not pre-empted under Section 301.

The court then turned to the LAD claim, which proved to be a more difficult question.  To establish a prima facie LAD claim, the plaintiff had to demonstrate (i) he was disabled; (ii) he was objectively qualified for his former position; (ii) he was terminated; and (iv) the company sought a replacement.  Although the court determined that each of these also presented a “purely factual inquiry,” the court recognized that the company may have a CBA-based defense based the CBA’s requirement that employees promptly comply with DOT physicals. Further, whether the plaintiff was “objectively qualified” for the position potentially implicated the CBA.

Ultimately, however, the appellate court determined that neither the requirement that the plaintiff was objectively qualified nor the company’s potential defenses required an interpretation of the CBA that would preempt the claim.  As noted by the New Jersey Supreme Court in Puglia v. Elk Pipeline, Inc., 226 N.J. 258, 279 (2016), “… a CBA-based defense is ordinarily insufficient to preempt an independent state-law action.”

Further, the CBA was not the only source, or even the primary source of the plaintiff’s duty to recertify.  Instead, it was DOT regulations that set forth the requirement and “To the extent an interpretation of them is required, federal law [and not the CBA] must be applied.”

Looking forward, unionized employers in New Jersey who are defending against claims under state law thus face additional hurdles stemming from decisions like Hejda v. Bell Container Corporation. For example, a Section 301 claim, which is a claim under a federal statute, could be removable to federal court.  Without the Section 301 claim, a defendant thus loses a potential basis for removal.  Additionally, where CBAs otherwise provide an administrative process that must be utilized before a Section 301 claim is filed, employers may lose the ability to enforce the administrative remedies provisions, or otherwise have a lawsuit dismissed if the administrative remedies were not exhausted. Last, unionized employees have a greater ability to circumvent Section 301’s limitation to contract-based remedies, and instead seek the full panoply of tort-based remedies that the LAD affords plaintiffs. Accordingly, the dynamics for any employer with an organized workforce that is defending a claim under New Jersey state law have shifted further in the direction of state-law protections, and away from the uniformity and precedent of the LMRA.

Hejda v. Bell Container Corporation, while not a sea change in the law, is representative of the both the trend in New Jersey of courts declining to find Section 301 pre-emption, as well as the courts’ interpretation of the LAD as a wide-reaching, liberally-construed source of employee protections.

By: Christopher W. Kelleher, Esq.

Seyfarth Synopsis: At today’s client symposium, “First 100 & Beyond: Strategy & Planning Summit for Businesses,” Brad Livingston offered insight into the state of the National Labor Relations Board under the Trump Administration.

At today’s client symposium on legal developments after 100+ days of the Trump Administration, Brad Livingston, the Chair of Seyfarth Shaw’s Labor Relations Practice Group, explained that change will occur — albeit slowly — with the National Labor Relations Board (“NLRB” or “Board”).  And he said that the question is whether there will be time for a Trump Board to restore some balance to decisions reached over the past eight years that many believe have been the most pro-union in the agency’s history.

Brad explained that while most other agencies that administer federal employment laws may shift their priorities, enforcement agendas, and litigation theories under different presidential administrations, the underlying statutes are ultimately interpreted by the courts. So although the EEOC may advance a new theory under Title VII or the ADEA, the courts will determine what those statutes mean.  And even though the federal courts may differ somewhat in their interpretations from time to time, over a longer period those decisions will end up being harmonized as the law gradually evolves.  As an example, Brad explained how while Title VII itself has remained relatively unchanged, over time the courts have eventually expanded its reach to cover quid pro quo sexual harassment, then hostile environment sexual harassment, same-sex sexual harassment, and now sexual orientation discrimination.

The NLRB is different in that  — rather than the federal courts — the agency itself decides what the National Labor Relations Act (“NLRA”) means, and these decisions by the administrative agency are given great deference by the courts as long as they are a permissible interpretation of the law (even where the court might have decided otherwise).  These NLRB decisions principally come from its General Counsel and five-member Board, all of whom are presidential appointees.  Historically, the president has appointed from his political party the General Counsel and three of the five Board members, with the two remaining Board members coming from the other political party.  Thus, and unlike with other employment laws such as Title VII, NLRB decisions regularly shift back and forth as presidential administrations change between the political parties.  So while the NLRA has been essentially unchanged for 70 years, there have been significant swings in how it has been interpreted and applied over that time.

Brad explained that there are two current vacancies on the five-member NLRB.  The Board’s Chairman is a Republican appointee whose term ends this December, and its other two current members are Democratic appointees whose terms end in late 2018 and 2019.  The General Counsel is a Democratic appointee whose term ends late this year.  So for the moment, any decisions reached by the Board will continue to have a Democratic and pro-union majority.  And while President Trump has had the opportunity to appoint two additional Republican members to the Board (giving it a Republican majority), in his first 100+ days of office he has not done so.  Even after those appointments are made and then confirmed by the Senate, it will take some time for the new Board members to get up to speed and actively participate in decisions.  With the Republican Board Chairman’s term coming to an end in several months, his reappointment or any new appointment and confirmation will likewise take time.

So for the moment, nothing has changed at the NLRB.  And even when Republican appointees eventually constitute the majority of the Board and its General Counsel, change will occur slowly.  While the Board has the authority to use rulemaking (which itself is a time-consuming process), it seldom does so.  Instead, the Board typically changes its interpretation of the law in its decisions regarding the unfair labor practice and union recognition cases brought before it. Significant issues that the Board may wish to address need to “percolate” up in cases pending before it before the NLRB can signal a shift from the interpretations of the prior administration.  Thus, the Board is limited to deciding the issues and cases raised by employers, employees and unions in individual cases. NLRB precedent does not change where there is no case raising that issue.

Brad noted that over the past eight years, the NLRB has issued scores of rulings that both limit the rights of employers and expand the rights of individual employees and unions far beyond the decisions of any previous Democratic administration.  Among many others, he gave examples of decisions that: ban class action waivers in employment agreements; prohibit discipline for certain types of employee misconduct; deem illegal many common employer handbook clauses, policies, and work rules; expand union and employee access to employer and non-employer property; permit employee use of an employer’s email systems for union purposes; expedite union elections; permit unions to seek “micro” or “fractured” bargaining units and restrict employer challenges to them; greatly expand joint-employer status; obligate employers to negotiate discipline with unions during initial contract negotiations; restrict a finding of impasse in labor negotiations; restrict employers from hiring permanent replacements during strikes; expand successorship status and the obligation to assume a predecessor employer’s labor agreement during the sale of a business; limit the interpretation of contractual waivers of the obligation to bargain with a union; and expand employee status and the right to organize to many college students.

Noting that the employer community wants and expects change from the NLRB, Brad cautioned that the current vacancies have not been filled, the confirmation of new Board members will take time, those new Board members will need to get up to speed before issuing decisions, and any eventual changes to the extraordinary NLRB decisions of the past 8 years are dependent on the same issue arising in a future case. He concluded by noting that we can expect change, but both less and more slowly than most employers would like to see.

 

NLRB (Logo)By: Glenn Smith, Esq.  & Kaitlyn F. Whiteside, Esq.

Seyfarth Synopsis: In a unanimous decision, a three-member panel of the NLRB found that a cab company violated the NLRA by changing the length of the waiting period for employee health insurance from one year to sixty days.

On May 16, 2017, Chairman Miscimarra, Member Pearce, and Member McFerran upheld an Administrative Law Judge’s determination that Western Cab Company violated Section 8(a)(5) of the NLRA by failing to give notice and an opportunity to bargain to the United Steelworkers during its 2014 implementation of the Patient Protection and Affordable Care Act (“ACA”).

According to the Board, because the ACA only prohibits waiting periods for employee health insurance of longer than ninety days, the employer had discretion over whether to reduce its one-year waiting period to “a 60-day waiting period….a 30- or 90-day waiting period, or even no waiting period at all.” Therefore, the employer owed the Union notice and an opportunity to bargain over the waiting period and any other aspects of the law that gave the employer discretion in compliance, such as the notice and enrollment and even the overall type of health insurance.

The reality for employers, which was not discussed by the Board, is that quite often employers are forced to attempt to make significant changes very quickly in order to comply with a newly effective law. According to the Board, these changes must be made while also navigating the legal obligation to provide notice and an opportunity to bargain to the Union over the implementation.  This obligation requires that employers have a robust and sophisticated understanding of the requirements of the law, and those aspects that may be discretionary, with enough advance time to allow for notice and bargaining with the Union.

Here, Western Cab received notice from its insurance provider in December 2013 that as of January, the ACA would require a significant shortening of Western Cab’s current waiting period, which at the time was one year. According to testimony before the ALJ, it was the insurance provider that mistakenly indicated that the waiting period under the ACA had to be sixty days.  As a result, Western Cab may not have even been aware when it implemented the sixty-day rule that it had made a discretionary decision.

Although he joined the majority, Chairman Miscimarra took the opportunity in a footnote to re-emphasize that “employers’ compliance with the NLRA should not frustrate their compliance with the complex array of non-NLRA legal obligations that confront them.” Further, in his view, the question is not simply whether the employer had any discretion in implementing the law.  Rather, the Chairman would focus on “whether the actions are similar in kind and degree to what the employer did in the past.”

In addition to finding a violation for failure to bargain over the ACA implementation, the panel also found the employer violated the Act by failing to give pre-imposition notice and an opportunity to bargain over discipline issued during negotiations for a first contract with the Union as required in the Board’s recent Total Security Management decision.  For more information on this disciplinary bargaining obligation, see our September 29, 2016 blog post here.  In a footnote, Chairman Miscimarra reiterated his disagreement with Total Security Management, a telling reminder that reversal may be in the cards should an appropriate case come before the Board when and if President Trump’s nominees to the NLRB are confirmed.

The key takeaway here is that for employers with unionized workforces, any change in terms and conditions of employment, whether positive or negative, requires notification and bargaining with the union.