Striking  By: Brian Stolzenbach, Esq.

Seyfarth Synopsis: Employers should not presume that they are permitted to stop paying for employees’ medical benefits once they go out on strike. In a 2-1 decision, the NLRB recently held that — at least in some circumstances — medical benefits may be “accrued” simply by virtue of being employed.  If so, then an employer may not stop those benefits during strike.

Nearly 70 years ago, the NLRB confirmed that an employer has no obligation to finance a strike against itself by paying wages to employees during a strike. See General Elec., 80 NLRB 510 (1948).  No one ever said that strikes are supposed to be painless for strikers or that they entitled to be paid not to work.  Decades after the General Electric decision, it has become very common for employers to provide their employees with medical insurance, in addition to wages, as a form of compensation.  Many (perhaps most) employers assume that the old axiom extends to this form of compensation, as well:  they believe they can never be required to continue paying for their employees’ medical insurance during a strike.  Alas, in Hawaiian Telcom, Inc., 365 NLRB No. 36 (Feb. 23, 2017), the NLRB held otherwise.  Over an impassioned dissent by Acting NLRB Chairman Phil Miscimarra, the two Democrat Members of the Board concluded that this is actually a question of contract interpretation.  Reviewing the collective bargaining agreement that had expired prior to the strike, the NLRB observed that the contract provided medical insurance for all employees covered by the agreement — with no exceptions, save for termination of employment.  Strikers, of course, have not terminated their employment, so the NLRB decided that medical benefits could not be stopped during the strike, even though the collective bargaining agreement had expired.

What does this mean for employers? At the very least, it means that they should be very familiar with the precise terms of the collective bargaining agreement and other documents (benefit plan documents, SPDs, etc.) that govern their medical benefits for organized employees.  They should consider how these documents may be interpreted and whether they may be in need of revision.  Of course, this is a complex area of overlapping labor relations and employee benefits law, and an employer may not lawfully be able to make the changes it desires, for various reasons.  Nevertheless, it is better to understand the potential obstacles and to make a considered decision about dealing with them well before a work stoppage looms on the horizon, rather than scrambling to deal with the issue during a strike or (worse) finding out five years after cutting off benefits during a strike that the decision to do so was unlawful, as the employer did in Hawaiian Telcom.

By: Bryan Bienias, Esq.

Seyfarth Synopsis: The Office of the General Counsel for the NLRB has asked the Board to adopt a sweeping new test that will significantly broaden the protections granted to employees who engage in frequent, short-term strikes during the same labor dispute. 

In a purported effort to update existing law to meet the realities of modern labor disputes, the Office of the General Counsel for the National Labor Relations Board last week announced that it will ask the Board to adopt a new test for determining whether intermittent and partial strikes are protected under the National Labor Relations Act. The GC distributed to all regional directors and officers a 15-page model brief to be inserted into filings before the Board and ALJs laying out its new test and also urges the Board to distinguish between “partial” and “intermittent” strikes (as the terms have be used interchangeably over the years).

Under the new test, the Act would explicitly protect employees who engage in multiple short-term strikes, particularly those addressing the same labor dispute, where: “(1) they involve a complete cessation of work, and are not so brief and frequent that they are tantamount to work slowdowns; (2) they are not designed to impose permanent conditions of work, but rather are designed to exert economic pressure; and (3) the employer is made aware of the employees’ purpose in striking.” Under current Board law, workers who strike multiple times, especially in the same labor dispute, can lose the Act’s protections and face discipline or termination.

Citing the need for certainty in the face of the increasing use of intermittent strikes by non-union workforces, as well as employers’ increasing use of temporary employees, the GC’s proposed test significantly broadens the protections granted to employees who engage in intermittent and partial strikes, while providing little guidance for employers as to how existing methods for addressing strike activity could reasonably combat the disruptions and uncertainty caused by frequent, short-term strikes.

The GC notes its test “recognizes that there is a point at which intermittent strikes are so frequent and brief that they enable employees to effectively reap the benefits of a strike without assuming the attendant risks,” citing examples of a ten-minute strike every thirty minutes, or an hourly work stoppage once employees reach daily production quotas. Beyond these extreme examples, however, the GC provides little in the way of practical limitations as to how frequently employers may strike during the same labor dispute before losing the Act’s protections.  Is a 45-minute strike every day protected?  A two-day strike every week?  As of now, it’s anybody’s guess.

The GC also claims that employers are “not helpless in the face of such strikes,” having traditional strategies of permanent replacement, lockouts, subcontracting, etc. at their disposal. But the question remains how practical or effective such traditional strategies would be in the face of frequent, short-term strikes multiple times per week or per month.

While we do not know whether the Board will ultimately adopt the GC’s proposed test, employers can expect to see these arguments raised in future NLRB proceedings. In the meantime, employers should consult with counsel regarding lawful strategies for minimizing risk and potential disruptions caused by employees’ and unions’ increasing use of intermittent or partial strikes during labor disputes.

 By:  Susan Jeanblanc Cohen, Esq.

Seyfarth Synopsis: In a split decision, the NLRB ruled that off-duty employees of an acute care hospital had the right to picket the hospital’s main lobby entrance.

After the collective bargaining agreement between acute care hospital Capital Medical Center (“the Hospital”) and UFCW Local 21 (“the Union”) expired on September 30, 2012 and the parties engaged in negotiations for months, the Union and some bargaining unit employees decided to engage in picketing and handbilling at the Hospital.  During this union activity, off-duty employees distributed handbills at the main lobby entrance of the hospital and the physicians’ pavilion entrance. In addition, a group of employees distributed handbills and carried picket signs along the public sidewalk next to the hospital driveway.  The Hospital did not interfere with these activities.  Later in the day, at least two off-duty employees went to the main lobby entrance of the Hospital with their picket signs, and one of the employees also distributed leaflets at the lobby entrance for a short period of time while holding her picket sign.  The Hospital informed the picketing employees that they were welcome to remain at the doorway and hand out leaflets, but that they were not allowed on Hospital property with their picket signs.  The picketers disregarded their employer’s instruction and remained at the lobby entrance with their picket signs.  The Hospital contacted the police, who said he would not force the picketers to leave because they were not being disruptive or blocking doors or ingress and egress.

In Capital Medical Center, 364 NLRB No. 69 (August 12, 2016), a split panel of the NLRB decided that the Hospital violated Section 8(a)(1) of the National Labor Relations Act (“NLRA”) by attempting to prevent the off-duty employees from picketing, threatening the employees with discipline and arrest for engaging in picketing, and contacting the police in an effort to have the picketing ended.  The majority did not rule that off-duty employees have an absolute right to picket a hospital’s lobby entrance, but cited the standard enunciated by the Supreme Court in Republic Aviation Corp. v. NLRB, 324 U.S. 793 (1945) that employee rights under Section 7 of the NLRA must be balanced against employer property rights and business interests.  Accordingly, picketing could be restricted if an employer shows that the restriction is required to maintain discipline and production.  Recognizing that acute care hospitals involve special considerations, the majority noted that hospitals may prohibit picketing in non-patient care areas if necessary to prevent patient disturbance or disruption of health care operations.  However, the majority decided that the Hospital did not show that the picketing in this case created any such disturbance or disruption or that restricting picketing was required to maintain discipline and production.  The majority felt that the presence of individuals peacefully holding picket signs near the main entrance to the Hospital was not likely to be any more disruptive or disturbing than the handbilling that the Hospital allowed.

The dissent, Member Miscimarra, felt that the majority improperly applied standards governing on-premises solicitation and distribution and applied them to on-premises picketing, noting that picketing is very different than other modes of communication and that the very presence of picketers on hospital property could disturb patients entering and exiting the facility. Member Miscimarra opined that the Hospital should have been allowed to restrict the on-premises picketing in this case.

 Employer Takeaway: Be prepared to allow off-duty employees to come onto employer property and even position themselves at entrances  while holding picket signs. Before restricting off-duty employees from such picketing, make sure there is evidence of real potential patient disturbance or disruption.  Conclusory statements that picketers could deter patients (or customers) from entering or, the acute care context, impact the healing environment will be insufficient.  In the case the a hospital, the NLRB will likely want to see evidence of the following types of behavior for a hospital to be able to lawfully restrict picketing:  patrolling the doorway, marching in formation, chanting and making noise, creating a barrier to entrances/exits, or other behavior that actually disturbed patients or disrupted hospital operations.

By: Brian Stolzenbach, Esq.

In early 1999, the Venetian Casino Resort in Las Vegas asked police officers to remove union protesters from a temporary walkway in front of the Venetian — a walkway the Venetian built on its property in exchange for the public expansion of the Las Vegas Strip to accommodate increased vehicular traffic.

Eventually, the Ninth Circuit determined that the walkway was a public forum, so the Venetian had no property right to exclude them.  In turn, the unions behind the protest filed an unfair labor practice charge challenging, among other things, the Venetian’s request that the police remove the protestors from the walkway (even though the police did not oblige).  The Venetian responded that its request was protected by the Petition Clause of the First Amendment to the U.S. Constitution (which protects “the right of the people . . . to petition the Government for a redress of grievances”) and therefore could not be a violation of the National Labor Relations Act (“Act”).  In 2011, the NLRB ruled that: (1) the request to the police was not protected by the First Amendment because it was not a “direct petition to the government” and (2) the request violated the Act.

On July 10, 2015, the D.C. Circuit reversed the NLRB, holding that the Venetian’s request to the police was a “direct petition to the government,” which is generally entitled to the protections of the Petition Clause of the First Amendment.  That said, the case still is not over because “sham petitions” — i.e., petitions that are “objectively baseless” and “brought with the specific intent to further wrongful conduct through the use of governmental process” — are not protected by the First Amendment.  The court remanded the case to the NLRB to determine whether the Venetian’s (16-year-old!) request to the police was a sham petition, in which case it still will be considered a violation of the Act.

Key point for employers:  Keep in mind that the Venetian did commit unfair labor practices by threatening to have the protestors arrested and by having its security officers place protestors under citizen’s arrest.  Neither of those actions could be protected by the First Amendment.  Many employers are quick to evict union protestors from “their property,” but the labor laws permit this only if the public truly has no right to be on the property.  In some cases, the public’s right in that regard is unknown to the employer, or at least unclear, until after the union challenges the eviction — as the Venetian found out in this case.  Further, while the D.C. Circuit’s opinion suggests that perhaps the safest thing to do is to call the police and let them sort it out, that option is often met with the practical reality that the police will not intervene (as in the Venetian’s situation).  To complicate matters further, when employees are involved in the protest, they may well have the right to be on the property, regardless of the employer’s property rights.  So what is an employer to do when faced with a workplace-related protest on or near its property?  First, know your property rights (as well as they can be known) beforehand.  Second, so long as things are peaceful and safe, take the time to think through your reaction very carefully.  Sometimes (though not always), the most successful reaction — and the one that can save you 16+ years of litigation — may be none at all.

  By: Sarah K. Hamilton, Esq. & Alison Loomis, Esq.

In a recent case of note, the Ninth Circuit held that federal labor laws did not preempt a shopping mall owner’s state law claims for trespass and nuisance against a union that was picketing a store in the mall.  See Retail Property Trust v. United Brotherhood of Carpenters, No. 12-56427 (9th Cir. September 23, 2014). 

The owner of a California shopping mall brought state trespass and nuisance claims against a union that protested in front of an Urban Outfitters store for its hiring of non-union subcontractors.  During the picketing, the union chanted loudly, blew whistles, hit and kicked a construction barricade, and banged picket signs against mall railings.  The mall responded by filing a lawsuit seeking declaratory and injunctive relief in state court.   The union removed the case to federal court on the grounds that the state law claims were preempted by federal law and stated a federal cause of action. 

Citing to a Seventh Circuit decision which held that, generally, claims involving secondary boycotts (i.e.  union action in support of a strike initiated by workers in a separate company) were “completely” preempted by LMRA Section 303, the District Court found that the mall owner’s trespass and nuisance claims were preempted by federal labor laws.   Based on the District Court’s preemption finding, the court dismissed the mall owner’s claims.

The Ninth Circuit reversed the lower court’s dismissal, finding that the alleged property-based torts of trespass and nuisance only incidentally involved union conduct, and therefore, were not preempted by federal labor laws.  For example, the mall owner did not seek to punish or prevent labor conduct; rather, it merely sought to stop conduct which violated its time, place, and manner rules. 

In its opinion, the court provides a comprehensive background of preemption, including discussion of the distinction between “complete” versus “defensive” preemption and the three types of defensive preemption: (1) express preemption, (2) field preemption, and (3) conflict preemption.  The Ninth Circuit noted that courts commonly use these terms inconsistently, and at times, incorrectly.  To read the Ninth Circuit’s thorough discussion of preemption analysis, see the court’s decision here.

The Ninth Circuit addressed the Seventh Circuit’s prior finding that state law claims involving secondary boycotts are  “completely” preempted (relied on by the District Court), stating that its sister circuit was “simply wrong.” Instead, the Ninth Circuit focused on the fact that trespass and nuisance are labor-neutral torts, with non-economic interests, and that regulation of this conduct is “deeply rooted in local feeling and responsibility.”  Here, per the Court, the mall owner was not trying to prevent or punish union activity; but rather, to prevent conduct that violates time, place, and manner restrictions. As such, the Ninth Circuit found that the conduct involved was only a peripheral concern of federal labor law.

The creation of a circuit split does nothing to clear the muddy waters of preemption.  That said, this case helps to provide a guide of labor preemption doctrines, as applicable in the Ninth Circuit. 

In addition, the case provides some positive recourse for employers facing a secondary boycott disrupting the workplace. Where an employer has content-neutral time, place, and manner restrictions in place, a civil action may be a possible remedy to explore.

By: Kamran Mirrafati, Esq.

Just in time for football season and tailgate parties, the NLRB Division of Advice recently issued a Memorandum effectively limiting parking lot demonstrations outside an employer’s facility.  [See Wal-Mart Stores, Inc., NLRB Div. of Advice, No. 13-CA-99526, August 14, 2013 (released August 23, 2013).]  Here, the employer’s actions were vindicated, but employers generally are cautioned not to read this Memorandum too broadly.

The NLRB has long held that an employer may lawfully prohibit non-employees (i.e., union organizers and other solicitors) from accessing its property. The NLRB also has held that any such prohibition may not extend to prevent off-duty employees from accessing an employer’s parking lots and other outside non-working areas. But, what if a demonstration on the employer’s premises is led by an off-duty employee and includes both employee and non-employee demonstrators?  

The Division of Advice recently answered this question: an employer may lawfully use police officers to remove non-employee demonstrators and their paraphernalia (i.e., a minivan containing a projection system and stadium style speakers) from its parking lot, so long as it allows any employee demonstrators to remain on the premises. According to the Division of Advice Memorandum, such actions do not interfere with employee rights to engage in concerted activities, even if the employee demonstrators were effectively leading the demonstration and were deprived use of property that was instrumental to their demonstration.   

In the case at hand, an off-duty Wal-Mart employee drove to a Wal-Mart store in a minivan owned by a third-party organization whose goal was to educate employees about labor laws. The van had logos of the third-party organization and other graphic images wrapping around the entire vehicle. The off-duty employee parked the vehicle in the parking lot, two rows from the front entrance of the store, and immediately began to lead a group of about 18 non-employee demonstrators with loud music such as the song “We’re Not Gonna Take It” and a projection of protest video clips onto the store’s façade.  After about 15 minutes of this activity, police officers advised all the non-employee demonstrators to leave the parking lot with the minivan, but permitted any off-duty employee demonstrators to remain on the premises. The off-duty employee who was leading the demonstration was not issued any citation by the officers, nor was he ever issued any discipline for his involvement in the demonstration.

The Advice Memorandum stated that Wal-Mart lawfully used the police to enforce its valid Solicitation and Distribution Policy because it reasonably concluded that the demonstration constituted solicitation by an outside organization in violation of its lawful policy. While the action of the police deprived employees the use of the minivan, it was found that Wal-Mart did not unreasonably conclude that the van was owned and operated by the third party organization because the van displayed the logo of the organization. As a result, the Division of Advice recommended that the charge be dismissed, absent withdrawal by the charging party.

Notwithstanding the positive holding of this Memorandum, employers must be cautious when addressing solicitation, distribution, and/or other protected concerted activity on their property. The decision here turned primarily on the fact that Wal-Mart “reasonably concluded that the demonstration constituted solicitation by an outside organization” because it was only able to recognize two of its employees among a larger group of approximately 20 demonstrators. Therefore, it is also reasonable to conclude that the result may have been far different if there had been a larger contingent of employees in the demonstration.

By Rachel L. Gradstein

California has enacted special labor laws that make it nearly impossible for employers to obtain injunctions against union trespass. This content-based favoritism for one form of speech raises constitutional questions, as federal courts have recognized. On December 27, 2012, however, in Ralphs Grocery Co. v. United Food & Commercial Workers Union Local 8, the California Supreme Court upheld these laws against constitutional challenge. In doing so our high court reversed a sensible 2010 decision by the Court of Appeal, which had struck down the laws on the basis that they, in giving unions the right to picket on privately owned walkways fronting retail store entrances, were unconstitutionally favoring labor speech over non-labor speech. 

The Facts

In 2007, UFCW unions pickets arranged themselves on a private walkway fronting the entrance of a Ralphs grocery store.  The pickets encouraged people to boycott Ralphs because its employees were not represented by a union.  In 2008, after unsuccessfully seeking the assistance of the local police, Ralphs sued the UFCW for an injunction against its trespass.  The UFCW’s defended itself by citing Moscone Act (Cal. Code Civ. Proc. § 527.3) and Labor Code section 1138.1.

The Statutes

The Moscone Act aims to promote worker rights to the collective bargaining process and to reduce judicial interference in labor disputes, by providing that certain labor-dispute activities cannot be enjoined.  The protected activities include “peaceful picketing or patrolling involving any labor dispute.”  Section 1138.1, meanwhile, applies where the Moscone Act does not, prohibiting injunctions unless the victim of picketing overcomes various onerous procedural hurdles.  These two statutes work together to insulate union activity from the state trespass laws that apply to people generally.

Procedural Posture

The trial court held the Moscone Act to be unconstitutional as impermissible content discrimination, but upheld Section 1138.1 and found that Ralphs had failed to satisfy its  requirements of 1138.1. The court thus denied the request for an injunction. 

The Court of Appeal reversed. The Court of Appeal first rejected the UFCW’s argument that a private entrance to a retail store was a public forum afforded protection under the California Constitution—as “’the entrance area and apron’ of the store ‘were not designed and presented to the public as public meeting places.’” Therefore, Ralphs could regulate speech on its property.  The Court of Appeal then struck down both the Moscone Act and Section 1138.1, because they give speech regarding labor disputes greater protection than speech involving other subjects and thus are unconstitutional under the free-speech guarantee of the First Amendment and the equal- protection guarantee of the Fourteenth Amendment .

The Supreme Court Ruling

The California Supreme Court agreed with the Court of Appeal that the privately owned walkway fronting the Ralphs customer entrance was not a public forum giving pickets free-speech protections under the California Constitution.  The Supreme Court relied on the Robins v. Pruneyard decision, which held that the public forum portion of a privately owned shopping center is limited to those common areas designed to facilitate and encourage congregation and socialization.

The Supreme Court then declared that although the UFCW could not invoke constitutional protections to justify its picketing, the UFCW could invoke the statutory protections provided by the Moscone Act and Section 1138.1.  In this analysis, the Supreme Court reviewed its earlier decisions on both the legality of peaceful picketing on private walkways as a matter of labor law and the perceived lack of necessity for judicial interference to protect an employer’ property rights.

Finally, the Supreme Court upheld both labor laws in question, concluding that the Court of Appeal had relied on inapplicable precedent involving laws that restricted speech in public forums.  The Supreme Court reasoned that neither the Moscone Act nor Section 1138.1 abridges speech—as invalidating them would not remove any restrictions on speech—and the speech in question took place on privately owned sidewalks.

The Supreme Court acknowledged that content-based speech regulation can be permissible if enacted for legitimate concerns unrelated to disagreement with the message.  Here, the labor laws allowing picketing on private sidewalks are “justified by the state’s interest in promoting collective bargaining to resolve labor disputes, the recognition that union picketing is a component of the collective bargaining process, and the understanding that the area outside the entrance of the targeted business is ‘the most effective point of persuasion.’”

For support, the Supreme Court cited other laws protecting labor-related speech in the context of economic regulations, and U.S. Supreme Court decisions that “support the proposition that labor-related speech may be treated differently than speech on other topics.”

Separate Opinions

The six-justice majority opinion was authored by Justice Kennard, while Justice Chin both concurred and dissented.  There were also two separate concurring opinions.

Chief Justice Cantil-Sakauye, concurring, relied on the portion of the Moscone Act that proscribes unlawful conduct—such as breach of the peace, disorderly conduct, and blocking of ingress and egress—to stress that the Moscone Act and Section 1138.1 do not protect union conduct that involves violence or aims to harm businesses by using tactics that go beyond “persuasion of patrons to labor’s position.”  She stated that the laws do not protect the use of signs larger than necessary or activity that occurs inside the premises.  The Chief Justice also emphasized that because the Moscone Act is to be construed with the purpose of limiting judicial interference, intervention of law enforcement will be necessary to address unlawful conduct.

In a separate opinion, Justice Liu agreed with the Chief Justice’s view that law enforcement officials may have to intervene in the event of unlawful union conduct, but disagreed with some of her examples regarding conduct that might not be protected.

The dissent by Justice Chin noted problems with the majority’s constitutional analysis, and noted that the California Supreme Court was setting itself on a collision course with the federal courts.

What Ralphs Means For Employers

Unless overruled by the U.S. Supreme Court, the Ralphs decision means that it is nearly impossible for California employers to obtain injunctions against union trespassers on their private property, unless the union pickets engage in unlawful activity, such as blocking ingress and egress, or violence.  The ruling does acknowledge, however, that employers can obtain law enforcement intervention and injunctions where unions engage in what the court has defined as unlawful activity.  Employers seeking injunctions for unlawful activity, however, still must satisfy the procedural hurdles established by Section 1138.1.