Striking  By: Bryan R. Bienias, Esq.

Seyfarth Synopsis: Court of Appeals for the First Circuit reversed the NLRB, holding that the Board lacked substantial evidence to find that the hospital group unfairly preferred nonunion workers when filling nonunion positions.

The National Labor Relations Board may not invalidate employment policies that accomplish legitimate goals in a nondiscriminatory manner “merely because the Board might see other ways to do it.” Such was the message the U.S. Court of Appeals for the First Circuit delivered to the Board in Southcoast Hospitals Group v. NLRB, No. 15-2146 (1st Cir. 2017).

The Court ruled that the Board lacked substantial evidence in finding that the hospital group discriminated against union members by giving nonunion workers a hiring preference for nonunion positions. The union’s contract granted union employees a similar preference when applying for union positions. According to Southcoast, the policy was intended to “level the playing field” and stave off staffing complaints by its nonunion workforce.

The Board argued that the policy tilted the playing field too far in favor of nonunion employees, claiming the number of nonunion positions “pales in comparison” to the number of positions covered by the union hiring policy and that nonunion hiring preference covered two facilities, as opposed to the single facility covered by the union policy.

This was not enough, the Court ruled. While the Court acknowledged that the nonunion policy covered more positions than the union hiring policy, union workers were not disproportionately harmed, given that the ratio of covered positions to covered employees was substantially the same under both policies. Likewise, nonunion employees had to compete with workers from two hospitals, as opposed to union workers’ need to compete only with workers from one hospital.

The Court also noted that the Board ignored other aspects of the hiring policies that still leave union members at a comparative advantage, namely that union seniority trumps qualifications for open union positions, while Southcoast is required to choose “the best qualified” candidate for a nonunion position, regardless of seniority.

Employer Takeaway

Employers must often walk a fine line in order to apply different policies to union and nonunion employees in a non-discriminatory manner. However, as the Court in Southcoast makes clear, this does not handcuff employers from attempting to “level the playing field” by giving certain advantages to nonunion employees, so long as the policy does not disproportionately harm union employees and is supported by a legitimate and substantial business justification.

NLRB    By: Bryan Bienias, Esq.

Seyfarth Synopsis: The U.S. Court of Appeals for the D.C. Circuit held that the National Labor Relations Board abused its discretion by ignoring its own precedent and downplaying threats made by pro-union employees during an election campaign where the union ultimately prevailed by a one-vote margin.

Should union supporters’ casual, half-hearted “threats” of violence during an election campaign warrant overturning the results in a closely contested election? Contrary to the NLRB, a three-judge panel of the D.C. Circuit Court of Appeals answered that, under the Board’s own precedent, “probably.”

The case, ManorCare of Kingston PA LLC v. National Labor Relations Board, 14-1166 (D.C. Cir. 2016) stems from a 2013 election among nurses’ aides at the employer’s Pennsylvania facility.  The union ultimately eked out a victory by a margin of 34-32.

The employer challenged the results, alleging that two bargaining unit nurses during the campaign threatened to “punch people in the face,” “beat people up and destroy their cars” and “slash their tires” if the union did not prevail. Although the nurses initially made these comments in a “somewhat joking manner,” the statements were disseminated to eight or nine other unit employees, some of whom believed the threats to be more serious, causing ManorCare to provide additional security for three days following the election.

The Board, purporting to apply its six-factor Westwood Hotel test for evaluating third-party threats during a campaign, and found the threats not sufficiently serious to overturn the election.  Without applying its test to the facts, the Board emphasized the “casual and joking nature” of the original comments and dismissed the remarks as “no more than bravado and bluster.”  Given that the statements were disseminated to other employees out of context, the Board claimed that a “game of telephone” should never be the basis for overturning an election.

The D.C. Circuit disagreed, finding that the Board abused its discretion by only cursorily acknowledging its own precedent and failing to discuss how the facts aligned with Board law. The Court noted that the Board has drawn a “firm line” that an election cannot stand where threats create a “general atmosphere of fear and reprisal” that render a free election impossible. The Court noted that the objective standard required by the Board’s precedent “requires assessing the threats according to what they reasonably conveyed, not what the speakers intended to convey.”  Thus, the Court found irrelevant that that the comments might have originated as jokes, noting that “[t]he remarks were threatening, and seriously so.”

The Court also found that the dissemination of the threats to eight or nine voters weighed against upholding the election results, especially since “only a single voter could have changed the outcome,” a fact the Board failed to acknowledge. The fact that the threats actually instilled fear in co-workers and were made in part by an employee who displayed visible injuries from a recent knife fight only underscored the objectively serious nature of the threats.

Despite the D.C. Circuit handing a victory to the company, employers can expect to see this case cited by unions and the Board when addressing similar “joking” statements by pro-company employees. As always, employers should strive to maintain an atmosphere free of physical threats and intimidation during an election campaign — among managers and staff alike — or run the risk of having a hard fought election victory overturned.

 By K. Phillip Tadlock

In NLRB v. Arkema, Inc., the Fifth Circuit Court of Appeals recently dealt the Board a setback, finding that the employer (Arkema) did not violate the National Labor Relations Act when it disciplined a union-supporter for threatening another employee before an election and when it distributed an anti-harassment reminder to its employees. The Court accordingly refused to enforce the NLRB’s order to the contrary.

Before 2008, the United Steelworkers of America represented a bargaining unit of 35 employees at Arkema’s Houston plant. In April 2008, a campaign to decertify the union began, and, in August, a secret-ballot election was held. Employees voted to decertify the Union by a vote of 18-17.

Prior to the decertification election, a male union-supporter at the plant approached one of the facility’s female employees and began talking to her about the union’s need for her support. The female employee depended on the physical help of her male counterparts to perform her job duties and she claimed that the union-supporter “threatened that male union employees would not come to [her] aid in an emergency if she did not support the union in the election.” She complained to management about this threat and the male employee was disciplined. Shortly thereafter, Arkema’s Plant Manager sent out an email advising employees of their right not to be harassed or punished based on their stance towards the union and advising employees to report any violations of these rights to the NLRB’s Houston office.  

On August 19, the Union filed an objection to the election results along with other unfair labor practice charges. An Administrative Law Judge found that the Company’s actions in disciplining the male union supporter and sending out the anti-harassment memorandum had violated the NLRA. Moreover, the ALJ determined that, because the violations took place before the decertification election, the election was tainted and its results should be invalidated. The Board subsequently affirmed the ALJ’s findings and applied to the Fifth Circuit for enforcement of its order.

The Fifth Circuit flatly disagreed with each position taken by the Board and the General Counsel.  As an initial matter, the court rejected the Board’s decision that Arkema had violated section 8(a)(1) of the Act by disciplining the union-supporter who made threats to a co-worker.  The Court found that the employee’s conduct “exceeded persuasion—he sought to threaten and intimidate [the female employee.] His own testimony verifies that he intended to communicate to her that he would withdraw the help on which she depended to do her job [if she did not support the union].” Accordingly, the Court found that these “threats do not fall under the protection of the Act and are subject to employer-discipline.” 

In addition, the Fifth Circuit held that Arkema did not violate the Act by sending out an e-mail reminding employees of the Company’s anti-harassment policies.  The Court disagreed that employees would interpret this e-mail as prohibiting protected activity.  Rather, it found that an employer has the right to assure employees that it will not allow them to be threatened by anyone.  The Court was further reassured that the memo was lawful because it was directed to all employees and not solely focused on reporting against those employees who were union advocates. 

Because the Court found that these pre-election activities did not violate the Act, it concluded there was no basis to overturn the election results.  This decision provides further support for employers to appeal unfavorable Board rulings where they believe the Board has overreached.  The more favorable law of a Circuit Court of Appeals, and the opportunity to have a panel of federal judges examine evidence from a different perspective, may result in having adverse Board rulings rendered unenforceable. 

By:  Joshua L. Ditelberg

Recently, the NLRB Acting General Counsel’s Division of Operations Management issued a memorandum to the Board’s Regional offices (OM 12-55) on how to address an employer’s attempt to litigate the work authorization status of an employee potentially eligible for backpay resulting from an unfair labor practice.

 The Supreme Court in Hoffman Plastic Compounds, Inc. v. NLRB, 535 U.S. 137 (2002), concluded that the Immigration Reform and Control Act (IRCA) bars the Board from awarding backpay to any individual who was not legally authorized to work in the United States during the backpay period. Nonetheless, the Acting General Counsel’s position is that an employer “may not use the compliance phase as a means to fish for disabling employee conduct under IRCA, i.e., no legal authorization for its employees to work in the United States.”  OM 12-55.

 In Flaum Appetizing Corp., 357 NLRB No. 162 (December 30, 2011), the NLRB struck the employer’s work authorization-based liability defenses under IRCA to the extent that they were entirely unsupported by evidence. The employee alleged that none of the discriminatees were entitled to work in the United States under IRCA, and thus none were entitled to backpay under Hoffman Plastics. The employer provided no evidence with regard to 11 employees it attempted to disqualify. However, it grounded its allegations concerning four other employees on record evidence elicited at the underlying unfair labor practice hearing, in which the employees testified that the green cards they had presented to the employer at the time of their hire were not their own. Concurrent with the hearing, the employer attempted to uncover disabling evidence on all employees by serving identical subpoenas duces tecum demanding their work authorization and identity documents under IRCA, such as passports, alien registration cards, driver’s licenses, and social security cards.

 The Board granted the Acting General Counsel’s pre-trial motion to strike the employer’s affirmative defenses as to the 11 employees who did not testify against their interests. The Board concluded that “IRCA does not require that the Board permit baseless inquiry into immigration status in every case in which reinstatement or backpay is granted.” Id., slip op. at p. 7.  Rather, “permitting such re-verification [of work authorization status] … without sufficient factual basis … would invite a form of abuse expressly prohibited by IRCA, and would contravene ordinary rules of procedure and undermine the policies of the Act.” Id. However, the Board allowed the employer to elaborate on its immigration-related defenses as to the four discriminatees who testified that their green cards were not their own. It directed employer to provide an amended bill of particulars to provide adequate elaboration of its claims, without which the administrative law judge would strike the defenses upon a motion by the Acting General Counsel.  Id.

 The Acting General Counsel’s memorandum instructs the Board’s Regional offices on how to apply Flaum.  If an employer invokes lack of authorization status as an affirmative defense to backpay, in a compliance proceeding the Region should demand a full accounting of evidence the employer intends to rely upon in order to assert that employees are ineligible for backpay under Hoffman Plastics.  If the employer cites inadequate evidence, including after moving for a bill of particulars, the Region should file a motion to strike the affirmative defenses. If subpoenas duces tecum have been served on discriminatees in a pending compliance proceeding in which such an affirmative defense has been pled, the Region should move to revoke the subpoenas conditionally, subject to a ruling on the motion for a bill of particulars and a review of the bill produced.

 Additionally, the Acting General Counsel instructs counsel for General Counsel to object to an employer’s  attempt to litigate a discriminatee’s or a witness’s immigration status at the merits phase, and should take a Special Appeal to the Board on any adverse ALJ ruling.  Indeed, the Regions may consider whether a charged party commits an independent violation of Section 8(a)(1) of the National Labor Relations Act where, without evidence of an employee’s disabling status, it issues Board subpoenas for the employee’s work authorization documents for purposes of harassing the employee.

 Thus, an employer’s ability to litigate an employee’s work authorization status as a defense to back pay is limited; and, in effect, the employer must have independent evidence of a lack of authorization to be able to explore the matter further in compliance litigation.  Moreover, the Acting General Counsel underscores that an employer cannot challenge an employee’s work authorization status (as either an alleged discriminate or a witness) as part of a trial on the merits of an unfair labor practice charge.

By K. Philip Tadlock

On May 4, 2012, the United States Court of Appeals for the Sixth Circuit released its opinion in NLRB v. Beacon Electric Co., No. 07-2554, and upheld the NLRB’s decision that an electrical contractor violated the NLRA by refusing to hire union salts who had applied for positions with the contractor in 1997. The Court found, despite protests from the employer, that the ALJ and Board had properly considered whether the employees were bona fide job applicants when applying for the positions at issue.

The path to the Court of Appeals was a long and winding one based on ever-evolving Board law and multiple remands to an ALJ. The case arose when union members applied for positions at Beacon in 1997. Beacon denied these individuals — who were acknowledged salters — employment, but hired non-union employees days later. The union then filed a charge against Beacon alleging discrimination in violation of Sections 8(a)(1) and 8(a)(3) of the NLRA. In response, Beacon claimed that it had an unwritten practice whereby it only hired employees solely based on referrals and this was the reason that the salters had not been hired, while others were.

No one bought this argument. In 1998, an ALJ sustained the complaint against Beacon, finding that the Company had discriminated against the salters. A final decision was not reached by the Board, however, until 2007 because the Board twice remanded the case to the ALJ to consider additional evidence in light of ever-changing Board law. Ultimately, the Board upheld the ALJ’s decision and found that a violation of the NLRA had occurred.

Beacon then appealed the case to the Sixth Circuit. Curiously, Beacon did not directly challenge the Board’s decision not to apply it’s recent ruling in Toering Elec. Co., 351 NLRB 238 (2007), to the case. In Toering, the Board found that the general counsel has a burden of establishing that an applicant had a genuine interest in seeking employment. Rather, Beacon presented a more roundabout argument that the Board failed to consider whether the salters were bona fide applicants and thus the Board had failed to apply the correct legal standard to the matter.

The Sixth Circuit found that the Board had used the correct legal standard in reaching its decision. Moreover, and contrary to Beacon’s arguments, the Circuit found that the ALJ had allowed the parties to present evidence regarding whether the salters were bona fide applicants and the ALJ made findings that they were. Thus, the Circuit upheld the Board’s decision.

The Circuit’s decision presents an interesting analysis of the Board’s evolving treatment of salters.