By: Jennifer L. Mora and Jeffrey A. Berman

As the National Labor Relations Board transitions from a Republican-majority to a Democrat-majority, the Board’s sole Democrat, Chairman McFerran, continues to provide a window into what the future is likely to look like under a Biden Board. This blog is another in a multi-part series discussing how Chairman McFerran’s dissents may become the law once President Biden appoints new Board members and the Democrats are in the majority. Another example of this appears in the Board’s March 18, 2021 decision, Dish Network, LLC, which considered the enforceability of certain provisions in a mandatory arbitration agreement.

The employer’s arbitration agreement required employees to submit “any” claim or controversy to mandatory arbitration, without any carve-out for unfair labor practices charges alleging violations of the National Labor Relations Act. The agreement further provided, among other things, that “all arbitration proceedings, including but not limited to hearings, discovery, settlements, and awards shall be confidential…”

The Board majority had little trouble in finding that requiring employees to arbitrate “any” claim or controversy unlawfully restricted employees in their ability to access the Board to seek redress for unfair labor practices. It was the confidentiality provision, however, that sparked a very lengthy debate between the Republican majority and McFerran’s dissent, with both sides either relying on or criticizing the Board’s decision in California Commerce Club, Inc. (2020) and disagreeing about the import of the Supreme Court’s decision in Epic Systems (which upheld class waivers in arbitration agreements).

In Dish, the Republican majority upheld the confidentiality provision, except to the extent that it required that “settlements” be kept confidential. On the former, the majority relied on the decision in California Commerce Club, which held that “provisions in an arbitration agreement requiring that arbitration be conducted on a confidential basis, including provisions precluding the disclosure of evidence, award, and/or decision beyond the arbitration proceeding, do not violate the Act and must be enforced according to their terms pursuant to the [Federal Arbitration Act].”

The Dish majority wrote: “the Supreme Court has repeatedly made clear that ‘the FAA requires that courts rigorously enforce arbitration agreements according to their terms, including terms that specify … the rules under which …arbitration will be conducted.” Thus, according to the majority, if a provision in an arbitration agreement pertains to arbitration “proceedings,” then the FAA shields the challenged provision.

However, the Board majority concluded, and McFerran agreed, the provision that “settlements” be kept confidential was unlawful because a settlement (an alternative to arbitration) is not part of the arbitral “proceeding.” As such, the FAA did not shield that provision. That being the case, the Board had to consider whether the requirement that settlements remain confidential violated Section 7. The Board agreed that it did, pointing to the fact that a settlement might cover an issue that could have been submitted to the Board and arguably would prohibit an employee from filing charges with the Board over a settlement that violated the Act.

Advancing the notion that the majority’s decision was yet another effort at forcing employees to “suffer in silence at work,” the McFerran dissent was forceful enough to result in the majority writing a separate section in response. In short, the McFerran maintained that the confidentiality provision restricted employees in their ability to seek redress from the Board and prohibited them from discussing terms and conditions of employment.

In terms of interfering with Board access, McFerran’s dissent gave as an example an employee being unable to seek Board redress if the employee learned during the arbitration about Section 7 violations. Or employees might be subject to “coercive interrogation” during arbitral discovery or directed not to discuss with co-workers the facts at issue in the matter. By maintaining a rule generally prohibiting disclosure about anything taking place at the proceeding to anyone necessarily meant that an employee could not reveal the information to a private attorney or the Board. It made no difference to McFerran that an employer would not actually be able to enforce these provisions as the Board as long recognized that such rules might have a “chilling effect” on employees.

Chairman McFerran made clear that the Board’s decision in California Commerce Club may have a short shelf-life, stating flatly that the case was “wrongly decided” and that the Board misapplied Supreme Court precedent “when it concluded that the NLRB and the FAA cannot be reconciled and that the FAA must displace the NLRA with respect to confidentiality provisions in mandatory arbitration agreements.” It could be the case that the Supreme Court will have to finally put the issue to rest.

As the McFerran dissent is likely to become Board law once Biden appoints new Members, employers should review their arbitration agreements to ensure that cannot be read to prevent employees from filing charges with the Board or discussing any settlement they might have with an employer over an employment-related dispute. Employers concerned about their confidentiality provisions should work with experienced labor counsel until the dust (hopefully) settles.

Wednesday, March 24, 2021
1:00 p.m. to 2:00 p.m. Eastern
12:00 p.m. to 1:00 p.m. Central
11:00 a.m. to 12:00 p.m. Mountain
10:00 a.m. to 11:00 a.m. Pacific

One part of the recently passed $1.9 trillion “American Rescue Plan” is the “Butch Lewis Emergency Pension Plan Relief Act of 2021” (“Butch Lewis”).  Butch Lewis is the long awaited law designed to provide underfunded multiemployer pension plans with sufficient monies to pay for all accrued benefits owed to retirees, without reduction, through the plan year ending in 2051.  Is this the reform plans and participating employers have been looking for?  In this webinar, Seyfarth attorneys will review Butch Lewis, address what it means for multiemployer plans, and discuss what it means for employers participating in those plans.

Topics will include:

  • Overview of prior pension reform attempts and the state of multiemployer pension plans
  • Butch Lewis as adopted
  • Plan eligibility for relief and the application process
  • Conditions on relief
  • Impact for multiemployer plans
  • Impact for participating employers

Register Here

Wednesday, March 24, 2021
1:00 p.m. to 2:00 p.m. Eastern
12:00 p.m. to 1:00 p.m. Central
11:00 a.m. to 12:00 p.m. Mountain
10:00 a.m. to 11:00 a.m. Pacific

One part of the recently passed $1.9 trillion “American Rescue Plan” is the “Butch Lewis Emergency Pension Plan Relief Act of 2021” (“Butch Lewis”).  Butch Lewis is the long awaited law designed to provide underfunded multiemployer pension plans with sufficient monies to pay for all accrued benefits owed to retirees, without reduction, through the plan year ending in 2051.  Is this the reform plans and participating employers have been looking for?  In this webinar, Seyfarth attorneys will review Butch Lewis, address what it means for multiemployer plans, and discuss what it means for employers participating in those plans.

Topics will include:

  • Overview of prior pension reform attempts and the state of multiemployer pension plans
  • Butch Lewis as adopted
  • Plan eligibility for relief and the application process
  • Conditions on relief
  • Impact for multiemployer plans
  • Impact for participating employers

Register Here

By Jennifer L. Mora and Jeffrey A. Berman

Seyfarth Synopsis: When a new President is about to shift the balance of power at the National Labor Relations Board, a Board dissent can foreshadow how the newly constituted Board will consider a similar issue. Such is the case in Stericycle, Inc., a February 17, 2021 divided Board decision addressing unilateral implementation of an employee handbook.

In Stericycle, the employer had a collective bargaining relationship with the Teamsters. In February 2015, the employer distributed a company-wide handbook at one of the union facilities. The handbook was inconsistent with several provisions in the parties’ collective-bargaining agreement, including those involving attendance, overtime, time off, work rules, discipline, grievance procedures, and the employee probationary period.

However, the first page of the handbook stated that “[s]ome benefits may not apply to union team members and in some cases these policies may be impacted by collective bargaining agreements.” The last page of the handbook required employees to sign and return to human resources a statement attesting that they “understand it is [our] responsibility to know and abide by its contents.” The employer had not applied the nationwide employee handbook in a manner inconsistent with the collective bargaining agreement.

The administrative law judge (ALJ) found the employer was obligated to provide the union advance notice and an opportunity to bargain over the handbook before distributing it. According to the ALJ, the handbook “contained numerous Company policies and practices that affected numerous mandatory subjects of bargaining.” The ALJ also ruled that the disclaimer language on the first page referring to union-represented employees “did not provide . . . clear guidance as to the applicable policies affecting certain terms and conditions of employment.”

A majority of the three Member panel, Members Emanuel and Ring, disagreed. While the handbook undoubtedly conflicted with some mandatory subjects in the labor agreement, the majority concluded the employer did not represent to employees that the handbook trumped the labor agreement and did not profess to make any changes to the collective bargaining agreement. The majority found it telling that the handbook stated on the first page that the labor agreement affected the policies in the handbook, and that some terms in the handbook might be different for the union-represented employees. Thus, the majority found no evidence of an intent to “modify, alter or change the existing contract” – – essentially, the employer’s disclaimer carried the day.

But it is Chairman McFerran’s dissent which, in the end, may be the most important part of the decision as it likely provides a roadmap for how the Biden Board will consider employer efforts to implement employee handbooks. Starting with the undisputed premise that the handbook conflicted in some respects with the labor agreement, the dissent took issue with the Board’s conclusion that the employer did not purport to change the labor agreement or represent to employees that the handbook superseded the agreement. The problem with this argument, according to McFerran, was that union-represented employees were required to sign an acknowledgement of their receipt of the handbook. Thus, the employer was essentially telling employees that it “was free to sidestep the Union and supplant, expand, or alter terms and conditions of employment that the parties had reached through bargaining and impose additional terms and conditions of employment without bargaining.”

Chairman McFerran also found the disclaimer lacking for several reasons. First, the disclaimer did not communicate to employees with “the clarity or the specificity required by the duty to recognize and bargain with the Union as employees’ exclusive representative.” Next, the handbook should have advised employees that the labor agreement trumped the handbook (rather than the opposite). This failure meant that employees were left to guess which handbook provisions were impacted by the labor agreement. And the disclaimer was silent about the application of new terms and conditions in the handbook that were not in the collective bargaining agreement. Ultimately, according to the dissent, the message the employer communicated to unit employees was that “it did not respect the Union as their exclusive representative.”

While employers with a mix of union and non-union workforces might understand that their employee handbooks do not supplant or alter a collective bargaining agreement with their employees’ bargaining representative, the Biden Board will ask in future cases – – do union-represented employees share this same understanding? The lesson for employers with mixed workforces is take a fresh look at their handbook disclaimers to make it extremely clear to unionized workforces that, if conflicts exist, the labor agreement always wins. However, depending on the composition of the new Biden Board, even this may not be sufficient.

By Ronald KramerSeong Kim, and James Hlawek

Seyfarth Synopsis:  On Monday, the Senate Parliamentarian ruled that the multiemployer pension plan bailout provisions in the $1.9 trillion American Rescue Plan (a.k.a. the latest COVID-19 relief bill) would be eligible for a simple majority vote in the Senate as part of the budget reconciliation process, and thus will remain as part of the relief bill likely to become law shortly.

On Monday, March 1st, Senate Finance Committee Chair Ron Wyden released a statement reporting that the Senate Parliamentarian had determined that the multiemployer pension plan reform provisions of the American Rescue Plan, entitled the “Butch Lewis Emergency Pension Plan Relief Act of 2021” (“Butch Lewis”), has the necessary budget impact to remain part of what is to be a budget reconciliation bill that will need only majority approval in the Senate.

In his press release, Senator Wyden stated the following:

“I’m pleased our pension protection package will remain in the critical relief bill. This economic crisis has hit already struggling pension plans like a wrecking ball, and the retirement security of millions of American workers depends on getting this package across the finish line.”

Given that the inclusion of Butch Lewis will not derail plans to vote the American Rescue Plan into law by a simple majority vote in the Senate, with Vice President Harris being the tie breaker, it is highly likely that Butch Lewis will remain in the final bill and, if passed, will become law very shortly.

As discussed in our prior post, Butch Lewis as drafted will make a seriously underfunded multiemployer plan eligible for “special financial assistance” that is not subject to any financial repayment obligations, designed to cover the amount required to pay all accrued benefits through the last day of the plan year ending in 2051.

The Protecting the Right to Organize Act, known as the PRO Act, was first introduced in February 2020 but flew somewhat under the radar given the onset of the pandemic. On February 4, 2021, House Democrats reintroduced the PRO Act in essentially the same form.

In this episode of Seyfarth’s Policy Matters Podcast, Scott Mallery, Counsel in Seyfarth’s Sacramento office, and Kyllan Kershaw, Partner in Seyfarth’s Atlanta office, discuss how the composition of government is much different for the recent reintroduction of the PRO Act, given the trifecta of democratic majorities in the House and Senate and a democratic president and vice president in the White House, and note that employers are undoubtedly tuned in.

Listen to the podcast here.

By: Jennifer L. Mora

On January 25, 2021, the National Labor Relations Board’s Division of Advice released an Advice Memo on the issue of whether certain cannabis workers were exempt from the National Labor Relations Act as agricultural workers. The Advice Memo noted at the outset that the “Board has not ruled on whether employees of a marijuana enterprise are agricultural laborers or statutory employees.” The difference in classification is important – the Board has jurisdiction over statutory employees but not agricultural laborers, which means the latter cannot seek redress from the NLRB for alleged labor law violations.

In determining whether a worker is an agricultural laborer, the Board, pursuant to an annual appropriations rider, looks to the broader definition of “agriculture” in the Fair Labor Standards Act, which includes the production of “horticultural commodities” as agricultural activity and, thus, exempt from the NLRB. In concluding that the workers at issue in the Advice Memo were exempt from the NLRA, the Division of Advice highlighted that the workers “perform a substantial amount of agricultural functions” within the meaning of the FLSA standard, including harvesting, pruning, and sorting of plants. Both of the employees used their hands rather than machines to perform their tasks, and were not involved in “transform[ing] the natural product from its raw state.”

The Division of Advice distinguished the facts before it from situations in two previous Advice Memos issued regarding marijuana facility employees. In one, the “processing assistants used machines that transformed the raw plant into retail products, whereas the two employees here handle the plants by hand and do not substantially transform them.” In the other, the functions were similar but the context was different, with the Division of Advice determining that the FLSA’s definition of “agriculture” was inapplicable because, unlike in the instant situation, the employees were not engaged in organizing activities as required by the appropriations rider.

The Advice Memo was limited to its facts and should not be read to mean that exempt cannabis or other agricultural workers are entitled to no protections. Indeed, some states have enacted statutes that protect the right of agricultural workers to organize. Importantly, Advice Memos are not binding on future Board determinations. And, given the Division of Advice wrote the memo before President Biden fired the NLRB General Counsel and the Deputy General Counsel, it remains to be seen whether a Biden Board will issue a decision that actually decides whether other cannabis workers who participate in the transformation of the product are agricultural workers or statutory employees.

With the new Biden Administration and Democrats now controlling Congress, employers can expect President Biden to move as quickly as possible to appoint Democratic Members to the NLRB. Currently, the Board has three Republican members, one Democratic member, and one vacancy. President Biden is well positioned to flip the majority composition of the Board by the end of this year. When he does so, employers can expect a more union-friendly NLRB and a reversal of many of the Board’s pro-employer decisions during the Trump administration.

In this episode of Seyfarth’s Policy Matters Podcast, Ashley Cano, Partner in the Labor and Employment department of Seyfarth’s Chicago office, and John Phillips, Senior Associate in the firm’s Houston office, discuss what employers can expect at the National Labor Relations Board over the next several months and at least the next few years.

Listen to the podcast here.

By: Ashley K. Cano and John P. Phillips

Seyfarth Synopsis: Last week, the NLRB held in a 2-1 decision that an employer’s rules restricting certain types of employee communications on social media were lawful under the NLRA.  However, the Board panel was sharply divided between its Republican majority and Lauren McFerran, its sole Democratic member.  In a strongly worded dissent, Member McFerran took issue with the ruling, signaling that this pro-employer stance may be on the NLRB’s chopping block once a Democratic majority is installed under the Biden Administration.  

For many years, the direction of the National Labor Relations Board has sharply oscillated depending on which political party has comprised the majority of its Members, and the divide between Republican and Democratic Board Members has been especially sharp in cases involving employer rules and policies.  Under the Obama Administration, the Board found that many common workplace policies were unlawful under the National Labor Relations Act because employees might “reasonably construe” them to prohibit protected concerted activity under Section 7 of the NLRA.

For example, the Obama Board held that policies requiring employees not to engage in conduct that impedes “harmonious interactions or relationships” or prohibiting “abusive or threatening language to anyone on company premises” violated the Act.  But when the make-up of the Board shifted following President Trump’s inauguration, the Board overruled the “reasonably construe” standard and adopted a standard aimed at striking a balance between (1) the nature and extent of the potential impact of the policy on employee Section 7 rights and (2) the employer’s legitimate justifications associated with the rule.

Last week, the Board issued another employer-friendly decision that reinforced its current standard and provided clarity that a number of provisions common to social media policies comport with the Act. However, the decision was reached over the strong dissent of the Board’s sole Democratic Member, and her dissent is a harbinger for expected change in Board decisions and policies following President-Elect Biden’s swearing-in.

The Board’s Decision

On January 4, 2021, in Medic Ambulance Service, Inc., 370 NLRB No. 65, the NLRB found that provisions in an employer’s social media policy that restricted employee communications on social media were lawful under the Act.  The provisions at issue prohibited employees from engaging in “inappropriate communications,” disclosing confidential information, using the employer’s name to denigrate or disparage causes or people, and posting photos of coworkers.  The Medic Ambulance decision was issued by NLRB Chairman John Ring and Member Marvin Kaplan, both appointees of President Donald Trump, with Member Lauren McFerran, the lone Democratic-appointed Member presently on the NLRB, dissenting.

The Board’s ruling adopted an NLRB administrative law judge’s findings that the employer violated the NLRA by maintaining rules that prohibited conducting personal business on company time or property and soliciting or distributing literature during working hours, but reversed the ALJ’s findings that the employer’s social media policy violated the Act.  The Board also reversed the ALJ’s finding that the employer unlawfully maintained rules prohibiting the sharing of employee compensation information and the use of social media to disparage the employer or others.

In reaching its decision, the Board majority pointed to the Board’s 2017 decision in Boeing Co., 365 NLRB No. 154 (2017), which rewrote the framework for assessing the legality of employer rules.  In that decision, the Trump era Board held that when evaluating a facially neutral rule or policy that would potentially interfere with the exercise of NLRA rights, the Board will balance the employer’s legitimate business justifications against the extent to which the rule, viewed from the perspective of reasonable employees, interferes with employee rights under the Act.  Using that framework, the Board majority found that the six challenged rules were lawful:

  • Regarding the rule prohibiting “inappropriate communications,” the Board majority found that an objectively reasonable employee would not read that prohibition in isolation, but would instead consider it in the context of the guidelines that followed, all of which were lawful. As a result, the prohibition did not violate the Act.
  • Regarding the rule prohibiting disclosure of confidential or proprietary information about the company or coworkers, the Board majority found that an objectively reasonable employee would not interpret the rule as potentially interfering with the exercise of NLRA-protected rights. The majority reasoned that the rule referenced copyrighted or trademarked information and trade secrets in the very next sentence, and it did not specifically reference employees’ contact information, wages, or other terms and conditions of employment.
  • Regarding the rule prohibiting employees from using the company’s name or logo to denigrate or otherwise comment on any opinion, cause, or person, the Board majority found that reading that together with the employer’s guideline directing employees to make it clear that their views expressed in social media were theirs alone, the prohibition was lawful. The majority reasoned that an objectively reasonable employee would understand the prohibition to be aimed at preventing employees from speaking on behalf of the company, rather than prohibiting them from referring to the company by name in a post critical of the company’s terms and conditions of employment.
  • Regarding the rules prohibiting employees from posting photos of coworkers without their consent and from posting pictures of company-owned equipment or other employees without obtaining written permission, the Board majority reasoned that read in their totality, the rules strongly implied that their purpose was to protect the company’s confidentiality interests and employees’ privacy interests. As a result, an objectively reasonable employee would not read the rules as prohibiting NLRA-protected activity.
  • Regarding the rule prohibiting employees from giving out information on current or former employee compensation, the Board majority reasoned that it was apparent the rule was intended to apply only when someone telephoned the company seeking information about a particular employee. As a result, objectively reasonable employees would understand the policy in that light, not as restricting their right to discuss their wages with each other or to disclose them to a union.
  • Regarding the rule prohibiting employees from using social media to disparage the company, its associates, customers, vendors, business practices, or patients, the Board majority found it was lawful because the employer had a legitimate justification in prohibiting its employees from disparaging it or its products to its customers and the public, and this justification outweighed the rule’s potential to interfere with employees’ exercise of NLRA-protected rights. In reaching this conclusion, the Board majority found it notable that the rule did not expressly restrict employee communications with other employees.

The Dissent

In her strongly worded dissent, Member McFerran said the Boeing decision and its progeny represent “a dramatic pivot” by the Board, and that the Board now “routinely allows employers to adopt broad work rules that threaten labor law rights.”  In her view, all six of the work rules upheld by the Board majority should have been found unlawful.

Member McFerran wrote that the majority’s decision illustrated how “eager” the Board majority is to uphold employer rules, and how little weight it gives to the rights protected by the NLRA.  She also clearly conveyed her belief that the Boeing decision and the rulings that have built on it were wrongly decided.

Takeaway for Employers

Although the Medic Ambulance decision is certainly a positive for employers, they may not want to rush to modify their workplace rules and policies in response.  As it currently stands, there are three Republican Members of the NLRB (Ring, Kaplan, and Emanuel), one Democratic Member (McFerran), and one open seat.  Employers can expect the open seat to be filled with a Democrat following Biden’s swearing-in as President, and for Emanuel’s seat to be filled with another Democrat following the expiration of his term in August 2021.  Once the Board Members flip to a Democratic majority, it would not be at all surprising for this decision, Boeing, and its progeny to be on the NLRB’s chopping block, and for the NLRB to return to the more restrictive legal framework for assessing the legality of employer rules and policies that was in place during the Obama Administration.

Indeed, employers can reasonably expect a wholesale change in approach at the NLRB, possibly beginning as soon as late 2021.  In addition to an anticipated overruling of Boeing and its progeny, employers can expect a new Democratic Board majority to take on issues such as joint employment, disciplinary standards, deferral, access to employer email systems, confidentiality in investigations, dues checkoff, “micro unit” bargaining, successors, withdrawal of recognition, and access to property, among many others.  In short, employers should plan for a much more union-friendly and activist NLRB in the coming years, and a Board that will likely examine and revisit many of the Trump era decisions that have issued over the last four years.

Employers should carefully measure and adapt their policies to account for another swing in the law, as well as the risks they may be taking,  In doing so, the attorneys of our Labor Management Relations Practice Group are here to assist you.

By: Molly Gabel and John L. Telford

Seyfarth Synopsis: Many employers have been dealing with threats of COVID-19 related work stoppages over the past several months.  Whether such strike activity is subject to no-strike clauses under the National Labor Relations Act or to mandatory bargaining and dispute resolution procedures under the Railway Labor Act has been a question on unionized employers’ minds.  On December 23, a federal district court answered that question affirmatively—at least under the RLA—issuing a temporary restraining order against the Brotherhood of Maintenance of Way Employees Division of the International Brotherhood of Teamsters (BMWED) for a threatened strike when Union Pacific Railroad Company (Union Pacific) refused to agree to the Union’s COVID-19 related demands.

Union Pacific and the BMWED began Section 6 bargaining under the RLA in November 2019.  BMWED served its Section 6 notice for increases in pay and additional paid time-off, among other things, on November 4, 2019.  The parties currently remain in bargaining, on a national handling-level, and have not yet invoked National Mediation Board services.

The Company implemented extensive COVID-19 safety protocols at the workplace, following CDC guidelines.  The railroad also granted its employees enhanced benefits providing 14 days of paid leave for those employees who were directed to quarantine due to workplace exposure to COVID-19.  The BMWED, however, demanded more.  Because Union Pacific had not ceded to all of its demands, the BMWED wrote to Union Pacific on December 17, 2020, stating that the Union “will declare a health and safety emergency because of the imminent threat to its members of serious injury or death, and will call for a cessation of work if UP does not take the necessary corrective actions.”

Specifically, BMWED demanded that: (1) Union Pacific pay employees absent from work for any COVID-19 related reason; (2) the Company provide access to COVID-19 testing on the job site and on Union Pacific time; (3) Union Pacific provide for temperature checks and if any employee’s temperature exceeded 100.4 degrees, the employee be prohibited from work until obtaining a negative COVID-19 test and that the employee be paid for work time missed; (4) any employee exposed to a person with COVID-19 in the workplace quarantine for at least 14 days, obtain a negative COVID-19 test before returning to work, and receive pay for missed work; (5) Union Pacific provide specific PPE to employees, not require employees to use a locker room, vehicle, or equipment that had not been sanitized within the last eight hours, and pay employees unable to work due to lack of the demanded PPE or sanitization; and (6) the Company require a six-feet social distancing rule under most circumstances.

Union Pacific filed suit in the United States District Court of Nebraska on December 17, 2020 to enjoin the threatened strike, seeking a temporary restraining order and declarative and injunctive relief.  On December 23, 2020, the Court granted the Company’s motion for a temporary restraining order.  See Union Pacific R.R. Co. v. Brotherhood of Maint. of Way Employees Div. of the Int’l Bhd. of Teamsters, Case No. 8:20-cv-516 (D.Neb. Dec. 23, 2020), 2020 WL 7443217.

The Company argued any work stoppage would violate Sections 2 and 6 of the RLA because BMWED was not exerting every reasonable effort to make and maintain its collective bargaining agreement and had not exhausted procedures before the NMB.  While the NLRA does not include this statutory prohibition of striking in support of contract changes, many NLRA-covered employers have contracted with their respective unions for this protection with effective no-strike clauses in their CBAs.

In support of its motion, Union Pacific presented evidence showing that a strike would impact the transport of goods to critical industries and cause the Company severe and irreparable financial loss.  Union Pacific also presented evidence of its extensive COVID-19 safety protocols and testimony from its Chief Medical Officer regarding the effectiveness of those measures.

The Union argued that the threatened job action constituted a protected refusal to work under the Federal Railroad Safety Act (FRSA) and that, under FRSA, a carrier “may not discharge, demote, suspend, reprimand, or in any other way discriminate against an employee . . . for refusing to work when confronted by a hazardous safety or security condition related to the performance of the employee’s duties.”  Although different, the Wendell H. Ford Aviation Investment and Reform Act for the 21st Century (AIR21) and Section 502 of the Labor Management Relations Act (LMRA) have corollaries to FRSA for air carriers and NLRA employers, respectively, with respect to pandemic-related refusals to work.

The Court agreed with Union Pacific, finding that BMWED would violate that RLA if it engaged in the work stoppage and that the FRSA did not give the Union a free pass to engage in  strike-related activity.  Notably, the Court stated that even if FRSA could be read to apply to strikes, “the pandemic is not a work-specific safety concern for the BMWED employees under FRSA.  Instead, the pandemic is unfortunately, a worldwide and widespread problem confronting not just the BMWED employees, but individuals of all walks of life.  Thus, it does not constitute a condition ‘related to the performance of employee’s duties’ for purposes of the FRSA.”  The Court went on to say that, because Union Pacific had implemented certain safety measures that complied with CDC guidance, “a reasonable individual under the circumstances would not conclude that there is ‘an imminent danger of death or serious injury’ presented by the current situation.”

After considering the Norris-LaGuardia Act’s procedural requirements concerning labor dispute injunctions and the Eighth Circuit’s injunctive relief standards, the Court ruled that Union Pacific had met its burden to temporarily restrain its employees from striking.  Injunction proceedings on the merits will follow.

The decision provides guidance to railroads that, at least under similar circumstances, unions may not encourage employees to walk off the job in support of COVID-19 related demands absent the complete exhaustion of mandatory bargaining procedures under the RLA.  It provides the same guidance to airlines, provided that a court would treat a AIR21 defense the same way this Court treated the FRSA defense.  It also offers at least a roadmap on how NLRA employers might be able to enforce their no-strike clauses in the face of LMRA Section 502 concerns.