Unfair Labor Practices

 

By: Tiffany Tran, Esq.

Seyfarth Synopsis: In another signal that the Board may overturn the Obama Board’s decision in Purple Communications allowing employees to use their employer’s email systems to communicate about wages, hours, working conditions and union issues, the Board recently published a letter reiterating its decision to reconsider Purple Communications and invited comment from the public on the standard the Board should apply in these cases.

Under Purple Communications, 361 NLRB 1050 (2014), employees who have access to their employer’s email system for work-related purposes have a presumptive right to use that system for Section 7 protected communications regarding wages, hours, working conditions and union issues on nonworking time. Purple Communications overturned the Board’s decision in Register Guard, 351 NLRB 1110 (2007), holding that employers may lawfully impose neutral restrictions on employees’ non-work-related uses of their email systems, even if those restrictions have the effect of limiting the use of those systems for communications regarding union or other protected concerted activity.

In December 2017, the newly appointed NLRB General Counsel Peter Robb issued a memo containing a broad overview of his initial agenda as General Counsel. The memo cited Purple Communications as one of the cases the GC “might want to provide the Board with alternative analysis.” We previously blogged about the GC’s memo on this issue here.

Less than one year later, in August 2018, the Board announced, and Seyfarth blogged about it here, that it would invite briefing on whether it should “adhere to, modify, or overrule Purple Communications.” The Board made this announcement in Caesars Entertainment Corporation d/b/a Rio All-Suites Hotel and Casino, a pending case before the board that directly applied Purple Communications. In Caesars Entertainment Corporation d/b/a Rio All-Suites Hotel and Casino, the Administrative Law Judge had found that the employer’s policy prohibiting the use of its email systems to send non-business communications violated Section 8(a)(1) of the NLRA under Purple Communications. The employer excepted to the decision and asked the Board to overrule Purple Communications. Rather than immediately issue a decision, the Board invited the public to comment on this issue.

After extending the deadline to file briefs until October 5, 2018, nineteen amicus briefs were filed from various unions, senators, and interested groups on both sides of the issues. Notably, the GC submitted a brief urging the Board to overrule Purple Communications and return to the holding of Register Guard. The GC further urged that exceptions should be made on a case-by-case basis where the Board determines that employees are unable to communicate in any way other than through the employer’s email system. Finally, the GC argued that Register Guard should apply to other employer-owned computer resources not made available by the employer to the public.

And while five Democrat Senators recently sent a letter to NLRB Chairman John Ring expressing concern over the Board’s invitation to file briefing on the Purple Communications standard, Chairman Ring’s response letter reaffirmed the Board’s decision to reconsider Purple Communications and stated “the Board requested briefing from all interested parties to ensure we are fully informed of the arguments on all sides.”

Although the Board has yet to issue its decision, the Board’s and GC’s actions appear to signal that employers may continue to have hope about winning this battle.

By Ashley Laken

Seyfarth Synopsis: NLRB affirms ALJ’s ruling finding that a cocktail bar waitress was illegally fired for voicing workplace concerns during a staff meeting.

On April 26, 2018, in Parkview Lounge, LLC d/b/a Ascent Lounge, 366 NLRB No. 71, the National Labor Relations Board affirmed an NLRB administrative law judge’s ruling that found that a non-unionized employer violated the National Labor Relations Act by discharging a cocktail waitress in response to her engaging in protected concerted activity when she vocally discussed workplace concerns at a staff meeting.

The Facts

During an all-staff meeting on January 27, 2016, the cocktail waitress raised a number of concerns affecting employees at the employer’s facility, including concerns about the employer’s on-call scheduling system, its failure to provide certain workplace benefits, its recent decrease in the pay rate during parties, the cold temperature in the bar, and the uncomfortable uniforms imposed on servers.  Other servers at the meeting nodded their heads in approval as the waitress voiced the various work issues.

After the meeting, the waitress sent an email to management in which she claimed that comments they had made to her were irresponsible, that it was her right to look for another job, and “I feel you’re personally holding a vendetta against me because I speak my mind on issues that affect us (the employees).”  Just two days later, the employer’s operating owner fired the waitress, telling her she was being terminated because she did not get along with management.

The Board’s Ruling

In finding that the employer violated the Act in firing the waitress, the Board found that the employer had terminated the waitress in response to her raising group workplace concerns during the January 27th staff meeting.  In reaching this conclusion, the Board observed that it was uncontested that the waitress was engaged in protected concerted activity when she voiced a number of group workplace concerns during the staff meeting, which were met by nods of approval from the assembled employees.  The Board also found that the employer’s operating owner had knowledge of the waitress’s protected concerted activity when he made the decision to terminate her.

The Board further found that the employer held animus toward the waitress speaking out at the meeting, noting that the suspicious timing of the discharge (just two days after she engaged in protected concerted activity) was evidence of animus and that the employer’s proffered reason for her termination (her inability to work with management) was pretextual.  In this regard, the Board observed that management had praised the waitress’s work performance just a week before her termination, and that the employer had listed performance issues as a reason for the waitress’s termination in its official report to the New York State Department of Labor.  The Board ordered the employer to offer the waitress reinstatement to her former job or a substantially equivalent position and to make her whole for any loss of earnings or other benefits.

Employer Takeaways

The decision serves as a reminder that it is unlawful for both unionized and non-unionized employers to terminate employees for raising group workplace concerns.  Because it is sometimes unclear whether an employee is raising group workplace concerns or purely personal gripes, when considering terminating any employees who have made complaints about their terms or conditions of employment, employers would be well-advised to consult labor counsel before proceeding with termination.

By:  Kyllan Kershaw & Kaitlyn Whiteside 

Seyfarth Synopsis: In Colorado Symphony Association, 366 NLRB No. 60 (April 13, 2018), the NLRB found that an employer had an obligation to disclose information related to individual overscale contracts because the request related to the union’s investigation of potential sex discrimination, a mandatory subject of bargaining.

In a unanimous decision issued on April 13, 2018, the NLRB upheld an Administrative Law Judge’s (“ALJ”) decision ordering the production and disclosure to the Union of individual overscale contracts entered into between the Colorado Symphony Association and certain of its musicians.

The catalyst for the request came from the Principal Flutist in the Symphony who believed that she was being paid less than her male counterparts.  The Flutist raised this concern to the Union during her individual contract negotiations with the Symphony, which did not involve the Union. She also alerted the Union to the fact that she was considering filing a charge with the Equal Employment Opportunity Commission (“EEOC”) regarding her alleged sex discrimination.  Although the Union advised the Flutist that they could not assist with her EEOC filing, they subsequently requested copies of the individual overscale contracts from the Symphony.  A mere two days later, and without the requested information, the Flutist filed her EEOC charge.

According to the ALJ and the NLRB, the Symphony was required to provide copies of the individual overscale agreements to the Union despite the fact that: (i) the CBA expressly authorized the Symphony to negotiate and enter into these agreements; (ii) the Union did not participate in the individual overscale agreement negotiations; (iii) the Union never filed or assisted with a grievance related to the overscale agreements, nor had it raised any issue regarding these agreements during negotiations for a new CBA; and (iv) the CBA did not prohibit the Symphony from engaging in race or sex discrimination or contain a clause obligating the Symphony to comply with all applicable federal and state law, meaning that there was no way for the Flutist to file a grievance under the agreement for her alleged discrimination.

Regardless, the ALJ found that “investigating possible employer race or sex discrimination is a legitimate purpose related to a union’s collective-bargaining duties and responsibilities,” even without the presence of a non-discrimination clause in the contract.  The ALJ speculated that because the parties were in negotiations, the Union could have used the individual overscale agreement information to propose the inclusion of such language in a future agreement.  Even if that was not the goal, however, the ALJ asserted that the Union was investigating potential sex discrimination, which is a well-established mandatory subject of bargaining.   The ALJ further noted that the Union “may therefore be entitled to information that is relevant and necessary to determining whether a particular employment action is discriminatory, even if the employment action itself is not a mandatory subject [of bargaining].”

The ALJ likewise dismissed the Symphony’s claim that the Union’s request constituted an improper fishing expedition for information to support the Flutist’s EEOC charge, noting that the Flutist had not filed the EEOC charge at the time of the initial request, the information sought was presumptively relevant, and that regardless of the EEOC charge filing, a union may conduct its own investigation of possible employer discrimination as part of its legitimate collective-bargaining duties and responsibilities, even where the CBA lacks any non-discrimination provision.

Employers should note that this case can be seen as emblematic of the increased expectations of a union’s responsibilities in the “Me Too” era.  It also appears that the NLRB is willing to accept these additional expectations as a legitimate responsibility of a union as the employee’s collective bargaining representative.  What remains to be seen is how far a union will go to protect its female members from sex discrimination and how much information the NLRB will require an employer to provide on non-mandatory subjects of bargaining where a union claims its request relates to investigating possible discrimination.

By: Christopher W. Kelleher

Seyfarth Synopsis: On March 15, 2018, the Second Circuit Court of Appeals issued its decision in Novelis Corp., et al. v. NLRB, et al., upholding several unfair labor practices against Novelis Corp., but due to passage of time and changed circumstances, halting the National Labor Relations Board’s efforts to issue a Gissel bargaining order against the Company.

Background

In December 2013, aluminum manufacturer Novelis Corp. announced to employees at its Oswego, New York facility that they would no longer receive Sunday premium pay and that holiday and vacation days would no longer count towards overtime eligibility.  In response, several employees began a union organizing campaign, and obtained union-authorization cards from a majority of eligible employees.  In early January 2014, after declining the union’s request for voluntary recognition, Novelis restored Sunday and holiday pay.

In its efforts to resist organizing, the Company reminded employees that Novelis’ unionized plant in Quebec had closed while its plant in non-unionized Oswego continued to flourish.  The Company also suggested that unionization would lead to loss of business.

Novelis narrowly prevailed in the February 2014 election by a vote of 287 to 273.  After the election, pro-union employee Everett Abare posted a vulgar remark on Facebook complaining about his paycheck and criticizing those who did not vote for the union.  In response, Novelis demoted Abare.

After a hearing, Administrative Law Judge Michael A. Rosas found Novelis committed numerous unfair labor practices.  Specifically, the Company violated Section 8(a)(1) by restoring Sunday and holiday pay, removing union literature, interrogating employees, and prohibiting employees from wearing union paraphernalia.  The ALJ also found that Novelis threatened employees with wage loss, plant closure, and more difficult working conditions if they were to unionize.  Finally, the ALJ found Novelis violated Sections 8(a)(1) and 8(a)(3) by demoting Abare after his Facebook post.  The ALJ recommended several forms of relief, but most notably, he recommended a Gissel bargaining order because, in his view, “traditional remedies … would be insufficient to alleviate the impact reasonably incurred by eligible unit employees[.]”

Novelis filed exceptions with the NLRB, seeking to introduce evidence of significant employee and management turnover since the alleged unfair labor practices, and arguing that changed circumstances rendered the bargaining order inappropriate.  In August 2016, even though more than two years had passed, the Board adopted the ALJ’s findings and refused to reopen the record.  Specifically, the Board noted that it “does not consider turnover among bargaining unit employees or management officials and the passage of time in determining whether a Gissel [bargaining] order is appropriate.”

Discussion

While the Court upheld the Board’s findings as to the unfair labor practices, it disagreed as to the appropriateness of the bargaining order.  In NLRB v. Gissel Packing Co., 395 U.S. 575 (1969), the Supreme Court held that sufficiently serious violations of the NLRA can justify an order requiring an employer to bargain with a union that did not win an organizing election.  However, the Second Circuit has “repeatedly held” that bargaining orders are a rare remedy which are warranted only when it is clearly established that traditional remedies such as a secret ballot rerun election cannot eliminate the effects of the employer’s past unfair labor practices.  Thus, employees should not have unions imposed upon them when, by exercise of their own free will, they might choose otherwise.

The Court found that the Board failed to consider changed circumstances in determining whether to hold a rerun election.  And the Court specifically disagreed with the Board’s contention that it should not consider turnover and passage of time in determining whether a bargaining order is appropriate.  Indeed, “relevant circumstances must be measured at the time of the issuance of the bargaining order and not at the time of the election.”

Several key factors led the Court to hold that a bargaining order was not a suitable remedy:  (1) Novelis took numerous remedial actions since committing the unfair labor practices; (2) two years had passed between the election and the Board’s decision, and a “substantial lapse of time casts doubt” on whether a majority of employees would choose to unionize; (3) the Board ignored key turnover in company leadership; and (4) the Board failed to consider significant employee turnover since the election.  It was thus inappropriate to impose union membership absent a finding that a new, fair election more than three years after the violations was not reasonably possible.

Key Takeaways

This case is instructive for several reasons.  First, employers should take caution when responding to organizing activity.  Novelis committed several avoidable unfair labor practices through its union avoidance techniques.  On the other hand, the case reaffirms that bargaining orders are extreme forms of relief, and should not be issued without careful consideration of whether changed circumstances render such an order inappropriate.

 

Yesterday, the National Labor Relations Board (NLRB or Board) issued an Order vacating the Board’s decision in Hy-Brand Industrial Contractors, Ltd. and Brandt Construction Co., 365 NLRB No. 156 (2017), in light of the determination by the Board’s Designated Agency Ethics Official that Member William Emanuel is, and should have been, disqualified from participating in the Hy-Brand proceeding. In Hy-Brand, the NLRB had overruled its joint employer test set forth in Browning-Ferris Industries, 362 NLRB No. 186 (2015),and returned to its pre Browning-Ferris test.

Under the pre Browning-Ferris joint employer test, which the Board had restored in Hy-Brand, two or more entities were deemed joint employers under the National Labor Relations Act (NLRA) if there was proof that one entity has exercised control over essential employment terms of another entity’s employees (rather than merely having reserved the right to exercise control) and did so directly and immediately (rather than indirectly) in a manner that was not limited and routine.

In contrast, under the Browning-Ferris test again in effect, the NLRB finds that two or more entities are joint employers of a single workforce if (1) they are both employers within the meaning of the common law;  and (2) they share or codetermine those matters governing the essential terms and conditions of employment. In evaluating whether an employer possesses sufficient control over employees to qualify as a joint employer, the Board will – among other factors — consider whether an employer has exercised control over terms and conditions of employment indirectly through an intermediary, or whether it has reserved the authority to do so.

As the Hy-Brand Board majority underscored, the breadth and vagueness of such a joint employer test threatens to ensnare a vast range of economic relationships, including:

  • insurance companies that require employers to take certain actions with their employees in order to comply with policy requirements for safety, security, health, etc.
  • franchisors
  • banks or other lenders whose financing terms may require certain performance measurements
  • any company that negotiates specific quality or product requirements
  • any company that grants access to its facilities for a contractor to perform services there, and then regulates the contractor’s access to the property for the duration of the contract
  • any company that is concerned about the quality of contracted services
  • consumers or small businesses who dictate times, manner, and some methods of performance of contractors

Accordingly, companies in or contemplating such relationships should account for this new development.  While it is widely expected that the Trump NLRB will eventually overrule Browning-Ferris, when that may occur is uncertain.

By: Robert A. Fisher & Skelly Harper

Seyfarth Synopsis: A 2016 decision of the National Labor Relations Board (“Board”) finding that the graduate students at Columbia University were employees under the National Labor Relations Act (“NLRA”) has been teed up for review by the Court of Appeals. In order to obtain appellate review of the Board’s decision, Columbia University has refused to bargain with the union certified to represent its graduate-student assistants.

In a landmark ruling, Columbia University, 364 NLRB No. 90 (2016), the Obama Board reversed prior precedent and held that graduate-student assistants at Columbia University were employees and therefore could vote on whether to form a union. After the Union prevailed at the election in December 2016, Columbia filed objections and requested a rerun election. In a decision issued in December 2017, the current Board rejected those objections and certified the Union as the exclusive bargaining representative of the graduate-student assistants. 365 NLRB No. 136.

Teeing up the issue of whether graduate-student assistants are employees under the NLRA, Columbia has now refused to bargain with the Union. There is no right to a direct appeal of Board decisions in representation cases, and the only way for the University to obtain review of the earlier election determination is by refusing to bargain with the Union. Presumably, the Union will file an unfair labor practice charge against Columbia that will then lead to an adverse Board decision against Columbia. At that point, the University would be able to ask a federal Court of Appeals to assess whether the Board correctly decided the employee issue in the first instance.

While it is not the Board’s practice to review representation cases in the context of a refusal to bargain, there is reason to believe that the current Board may revisit whether graduate-student assistants are employees under the NLRA. Both Columbia decisions included vigorous dissents by a Republican Board member. In addition, in a separate December 2017 decision in a case involving Harvard University, another Republican Board member noted his view that Board precedent on the employee-status of students warrants reconsideration. Indeed, the Board had previously gone back and forth on the issue. In Brown University, 342 NLRB 483 (2004), the Board held that graduate-student assistants were not employees. Just two years earlier, in New York University, 332 NLRB 1205 (2000), the Board had held that graduate-student assistants were employees under the NLRA.

Regardless of whether the Columbia University decision is revisited through the appeals process or by the Board itself, it is unlikely that the 2016 decision will be the last word on the issue. The final outcome will most certainly impact efforts by unions to organize graduate-student assistants and other students such as residence assistants. The final decision also may impact the cases in which certain college athletes, usually scholarship athletes, are claiming employee status for purposes of state and federal wage-hour laws.

By: Ashley Laken, Esq. & Brian Stolzenbach, Esq.

Seyfarth Synopsis: Although many employers may think they can let their guard down a little bit when it comes to the NLRB under the Trump Administration, history suggests otherwise. During the last Republican Administration, labor unions often decided to wage their battles outside the NLRB, using tactics like the “corporate campaign.” Although corporate campaigns have been around for a long time and continued even during the Obama Administration, union corporate campaign activity during the Bush Administration suggests that employers would be well advised to implement strategies aimed at reducing their vulnerability to such campaigns and effectively responding to such campaigns in the event they become a target.

When the NLRB shifts from Democrat control to Republican control, as it has under the Trump Administration, many employers rejoice, believing that a Republican-controlled NLRB will take a more employer-friendly approach. This is almost certainly true, but employers should keep in mind that appeals to NLRB intervention are not the only ways for unions to create incredible headaches for employers.

Background on Corporate Campaigns

A corporate campaign is an attack by a union on a company or an industry with the goal of putting so much pressure on the target that it will give in to the union’s demands. Such attacks are multi-pronged and often long-running. Indeed, unions have devoted millions of dollars and multiple years to individual corporate campaigns, and such campaigns have become more sophisticated and coordinated over the years. The typical union philosophy in launching such a campaign is to cost an employer so much time and money and cause it so much disruption that it ultimately gives in to what the union wants.

A corporate campaign’s most common objective is to facilitate union organizing, often by coercing an employer into accepting a card-check agreement along with neutrality commitments (in other words, to agree to recognize the union without a formal election and to stay silent on its views regarding the unionization of its workforce). Corporate campaigns are widely known as a means of organizing workers by disorganizing companies.

In launching a corporate campaign, a union identifies and then exploits a company’s perceived vulnerabilities. Common tactics unions employ in corporate campaigns include:

  • Filing a stream of unfair labor practice charges against the company
  • Encouraging investigations of potential OSHA, wage and hour, environmental, and/or antitrust violations by the company (see our recent management alert regarding antitrust enforcement against employers here)
  • Causing union-paid organizers to get jobs within the company (known as “salting”)
  • Placing print, digital, radio, and/or TV ads attacking the company, establishing anti-company websites, and distributing anti-company materials (including emails and social media messages) to customers, shareholders, and employees
  • Introducing shareholder resolutions aimed at reducing management’s independence
  • Challenging the zoning or permitting of new company facilities
  • Alleging or implying sexual misconduct by company executives or claiming that the company does not pay its employees fairly (the #metoo and #timesup movements are likely to add more fuel to any such fire)
  • Recruiting celebrities, politicians, clergy, and other community leaders to put pressure on the company

A variety of unions have launched a multitude of corporate campaigns over the years, and they often team up with each other and pool their resources against a single company. Collectively, unions employ hundreds of professional corporate campaigners, with job titles such as “online advocacy organizer” and “strategic communications specialist.” The typical position postings for such jobs list responsibilities that include developing campaign strategies and messages, conducting online research, and executing effective media plans. Given the growing presence of Millennials in the workforce, a group that (broadly speaking) considers itself both technologically savvy and socially conscious, unions are likely to have no shortage of candidates for such positions.       

What Employers Can Do

Companies of all sizes, in all locations, and in all industries are potentially vulnerable to corporate campaigns. Of course, the larger the company, the more attractive that company may be as a target, as more employees equals more potential revenue from union dues. In reality, however, almost no relatively large company is safe from such an attack.

Given the power of the internet and the ubiquity of social media platforms such as Facebook, Snapchat, Twitter, and Instagram, the speed with which unions can launch and carry out sophisticated and well-coordinated corporate campaigns is nothing short of astounding. Employers would be well-advised to proactively develop strategies aimed at reducing their vulnerability to such campaigns and quickly and effectively responding to such campaigns. Such strategies could include:

  • Conducting OSHA, wage and hour, and antitrust compliance audits
  • Engaging in positive employee relations training and messaging
  • Conducting up-to-date anti-harassment training
  • Evaluating pay equity within the company
  • Creating an effective internal and external communication system in relation to potential and actual union activity
  • Assembling a dedicated team of inside or outside counsel to respond to filings at the NLRB, such as unfair labor practice charges and representation petitions

Seyfarth lawyers have extensive experience devising and implementing strategies designed to avoid and effectively respond to corporate campaigns. Please don’t hesitate to contact your favorite Seyfarth attorney for more information.

 By: Bryan R. Bienias, Esq.

Seyfarth Synopsis: On Friday, December 1, 2017, newly appointed NLRB General Counsel Peter Robb issued a memorandum containing a broad overview of his initial agenda as General Counsel. It previews many anticipated developments during the Trump Administration. Our blog is exploring a different aspect of the memo each day during the first three weeks of December.  Click here, here, here, here, here, here, here, here, here, here, here, here & here to find prior posts.

While the weather outside may be frightful (for some), the agenda recently set forth by NLRB General Counsel Robb in GC 18-02 is sure to make some employers delightful this holiday season. In this installment, we will focus on the GC’s targeting of the Obama Board’s controversial decisions imposing the duty to bargain over discipline of newly unionized employees, as well as the GC’s preservation of longstanding Board doctrines governing employer campaign communications and withdrawing recognition of unpopular unions.

Out with the Old: The End of Alan Ritchey?

As we discussed here, the Board in Total Security Management, 364 NLRB No. 106 (Aug. 26, 2016) not only reaffirmed the Board’s employer-maligned Alan Ritchey decision, which required employers to bargain over discretionary discipline issued to newly organized employees prior to execution of a first contract, but also mandated prospective make-whole relief including reinstatement and back pay for future violations.

Total Security Management went even further and held that such make-whole relief would be subject to an employer’s “for cause” affirmative defense, placing the ultimate burden of persuasion on the employer to show at the compliance phase that (1) the employee engaged in misconduct; (2) the misconduct was the reason for the suspension or discharge; and (3) that the employee would have received the same discipline regardless of any disparate treatment or reasons for leniency shown by the charging party.

With GC 18-02’s listing of Total Security Management as one Board decision that “might support issuance of complaint, but where we also might want to provide the Board with an alternative analysis,” GC Robb sends a gift-wrapped message to employers that, much like 2017, Alan Ritchey’s and Total Security Management’s days may be numbered.  However, employers should continue treading carefully when considering discipline for newly unionized employees. While the Board’s reversal of these precedents are on the agenda, they remain the law of the land.

In with the . . . Old?: Preserving the Levitz Furniture and Tri-Cast Doctrines

GC Robb’s memo also expressly rescinds former General Counsel Peter Griffin’s GC 16-03, which implored the Board to overturn the framework set forth in Levitz Furniture, 333 NLRB 717, 717 (2001), which allows employers to unilaterally withdraw recognition from a union based on objective evidence that the union has lost majority support (i.e., employee signatures).  Griffin advocated for a new rule requiring a Board-sanctioned election before an employer could lawfully withdraw recognition.  With Robb’s rescinding of GC 16-03, employers can sleep somewhat easier in the year(s) ahead knowing that the Levitz framework will remain intact and that the option for employees to quickly rid themselves of an unpopular union will not be impeded through a long and costly election process.

In addition, GC 18-02 announces Robb’s abandonment of GC Griffin’s initiative to overturn the Board’s Tri-cast doctrine regarding the legality of employer statements to employees during organizing campaigns.  In Tri-Cast, 274 NLRB 377 (1985), the Board held that an employer could lawfully inform employees during a union campaign that they will not be able to discuss matters directly with management if they vote for the union and that such statements could not reasonably be characterized as retaliatory threats.

While the Obama Board had indicated its willingness to eventually overturn Tri-Cast, GC 18-02 effectively ensures that the current Board will maintain the status quo in the new year.

Should you have any questions about GC 18-02 or any labor relations issue, please contact the author, your Seyfarth attorney, or any member of the Labor & Employee Relations Team.

By: John J. Toner, Esq.

Seyfarth Synopsis: In a decision issued late last week, The Boeing Company, 365 NLRB No. 154 (Boeing), the newly constituted “Trump” National Labor Relations Board (“Board”) announced that employers could once again maintain common sense rules regarding employee conduct at the workplace.

Of all the decisions issued in recent years by the previous Board, none was more baffling than those regarding an employer’s required standards of employee conduct contained in employee handbooks. These decisions were premised on a 13-year old decision in Lutheran Heritage Village-Livonia (Lutheran Heritage) which held that, in addition to an employer’s policy being found unlawful if it explicitly restricted protected, concerted activities under Section 7 of the National Labor Relations Act, a policy would also be found unlawful if :

  • employees would reasonably construe the language to prohibit Section 7 activity,
  • the rule was promulgated in response to union activity, or
  • the rule has been applied to restrict the exercise of Section 7 rights.

The Obama Board used the first test (how would employees “reasonably construe” the language of a policy) to invalidate numerous common sense policies, such as requiring employees not to engage in conduct that impedes “harmonious interactions or relationship” or prohibiting “abusive or threatening language to anyone on company premises.” The Board found these and other policies to be illegal without taking into account an employer’s legitimate justifications or the “real-world complexities” in a workplace.

To further complicate matters, the Obama Board sometimes found policies with the same objective (civility in the workplace) to be lawful. The byzantine nature of these decisions made it nearly impossible for an employer to maintain policies regarding employee conduct with any assurance that the Board would find the policies to be lawful.

In the Boeing decision, the Board majority (Chairman Miscimarra, and Members Emanuel and Kaplan), over a strong dissent (Members Pearce and McFerran), thankfully overruled the Lutheran Heritage “reasonably construe” standard and established a new test for evaluating whether a facially neutral policy, rule, or handbook provision, when reasonably interpreted, would interfere with employee Section 7 rights. Specifically, the Board in evaluating a policy will seek to strike a proper 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.

To provide greater clarity to all parties, the Board’s majority announced that, in the future, it will analyze the legality of workplace policies based on three categories:

  • Category 1 will include rules that the Board designates as lawful to maintain, either because (i) the rule, when reasonably interpreted, does not prohibit or interfere with the exercise of NLRA rights, and thus no balancing of employee rights versus employer justification is warranted; or (ii) the potential adverse impact on protected rights is outweighed by justifications associated with the rule.
  • Category 2 will include rules that warrant individualized scrutiny in each case as to whether the rule would prohibit or interfere with NLRA rights, and if so, whether any adverse impact on NLRA-protected conduct is outweighed by legitimate justifications.
  • Category 3 will include rules that the Board will designate as unlawful to maintain because they would prohibit or limit NLRA-protected conduct, and the adverse impact on NLRA rights is not outweighed by justifications associated with the rule. The Board gave as an example under Category 3 a policy prohibiting employees from discussing wages or other working conditions.

The Board specifically highlighted as examples of policies that would be legal under Category 1, including policies requiring employees to foster “harmonious interactions and relationships” or “rules requiring employees to abide by basic standards of civility,” and overruled previous cases that held to the contrary.

To be sure, there will be some confusion and issues to be addressed as the newly-announced categories are applied to employee handbook policies, but what is certain is that employers can once again lawfully require that employees maintain a reasonable level of civility in the workplace.

 

 

 

 By: Bradford L. Livingston, Esq.

In yet another significant decision overturning a controversial Obama-era ruling, the NLRB has reverted to its prior standards in determining what will be an appropriate bargaining unit for union organizing and bargaining. PCC Structurals, Inc., 365 NLRB No. 160 (December 15, 2017).  Just a day before his term on the Board ended leaving a vacancy and 2-2 split among its members, Chairman Miscimarra along with the two newest Board members appointed by President Trump — over the sharp dissent of the Board’s two Democratic members — reversed the so-called “micro bargaining unit” test set out in Specialty Healthcare & Rehabilitation Center of Mobile, 357 NLRB 934 (2011). It’s now a Big(ger) Ba(rgaini)ng Theory, or as Sheldon Cooper might say: Bazinga!

By way of background, bargaining units are the identifiable groups of employees that unions can organize, represent, and bargain for at an employer’s facility or facilities. While the National Labor Relations Act for the most part does not define the specific requirements for who can be included in or excluded from any individual unit, it instead looks at whether the group shares enough common working conditions or “an appropriate community of interests.”  Those interests can include an almost limitless number of factors, ranging from the employer’s organizational, management and supervisory structure to which parking lots, break rooms or time clocks certain groups of employees use.  Sometimes a union may represent all employees except managers and supervisors who work at a single location.  Other times, they may represent just a particular craft (e.g., electricians), type of worker (e.g., clerical), or alternatively employees who work at multiple of the employer’s locations.  Likewise, at any individual facility, an employer may be required to deal and negotiate separate labor agreements with (and face the possibility of a strike from) multiple different unions and bargaining units.

The composition of a bargaining unit is significant for both organizing and bargaining. Under the NLRA, it does not need to be the “most” appropriate unit, merely “an” appropriate unit.  When a union files an organizing petition with the NLRB, it has invariably self-selected the group of employees where the union feels it has the best chance of winning a representation election. Often, this may be a smaller group within any facility. Under Specialty Healthcare, the NLRB had ruled that so long as any group that a union selected was minimally appropriate, it would not entertain an employer’s objections unless it could establish that other employees shared “an overwhelming” community of interest with the group the union wanted to represent. As cases under Specialty Healthcare found, working conditions need to “overlap almost completely” so that there was “no legitimate basis” for excluding others from the group the union sought to represent.  In effect, a union could often select a small group of employees within a much larger group, succeed in organizing them, and then it or other unions could try later to organize either other individual groups or the rest of the employees.  Divide and conquer.  Employers were faced with a greater likelihood of negotiating and administering different labor agreements with multiple individual bargaining units at the same facility.

In PCC Structurals, the NLRB reverted to its historical way of assessing any group that a union may seek to represent, looking at both the commonalities and differences in the employment relationship that the group shares with other coworkers.  In that case, the union sought to represent roughly 100 of over 2500 employees working at three of the employer’s facilities in Oregon.  These 100 employees worked in different departments and had different supervisors, each of whom was responsible for supervising other employees that the union did not seek to represent. In rejecting the Specialty Healthcare test under which the smaller group was found appropriate, the Board emphasized that each case will need to be assessed individually and that a smaller unit will not necessarily be appropriate.  Bigger may be better. Bazinga!