Labor Relations Counsel - Legal Insight into Labor Relations Developments

By Jeffrey Place

The National Labor Relations Board (“the Board”) recently issued its decision in Caterpillar, Inc., 359 NLRB No. 97, in which a union charged that the employer had violated the National Labor Relations Act (“the Act”) by refusing to grant the union access to the employer’s facility to conduct a health and safety inspection in the wake of a fatal accident. The company objected to the union’s request on several grounds. First, the company noted that it had conducted an accident re-creation, which it allowed the union’s steward to attend, and had also provided a video recording of the re-creation to the union’s safety specialist. Further, the company provided copies of post-accident photographs and the local police department’s investigation file to the union. Finally, the company pointed out that the union also represented one of the company’s primary competitors, and stated that the company wanted to maintain the confidentiality of its manufacturing procedures. 

The union asserted that photographs and video recordings could not take the place of an on-site inspection, because only being physically present at the location of the accident would give the safety specialist a full understanding of the lines of sight, angles, and physical dimensions of the work area. Further, the union noted that the police department had been unable to determine the precise cause of the accident during its investigation. The union argued that it needed access to the employer’s facility in order conduct an independent investigation, which would allow the union to then engage in informed dialogue with the company about methods for preventing future accidents.

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By Jeff Place

The Board’s recent decision in DirectTV, 359 NLRB No. 54, represents another example of its ongoing effort to ensure the relevancy of the National Labor Relations Act in the 21st century by applying its protections to a broad range of personnel policies common among non-unionized employers. Many employers have issued policies intended to protect legitimate company interests, such as safeguarding the company’s confidential information or ensuring that only official company spokespersons make public statements on behalf of the company. Under the current Board, however, such common employer policies may be deemed to chill employee exercise of activity protected under the Act. Thus, for example, the Board has long held that employees have a protected right under Section 7 to discuss their wages, hours, and terms and conditions of employment with each other, with representatives of labor unions, with members of the media, and with the public in general. This includes a right to air disputes between employees and the company publicly. If the Board concludes that a generally applicable company policy is either overly broad or sufficiently ambiguous that it could reasonably be expected to deter an employee from engaging in protected communications, it will order the employer to rescind the policy.

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In a recently-issued decision, Supply Technologies, LLC, 359 NLRB No. 58 (2012), (pdf) the National Labor Relations Board struck down a non-union employer’s mandatory arbitration program on the grounds that the program interfered with employees’ Section 7 rights under the National Labor Relations Act (“the Act”). The Board’s penchant in recent years for finding various policies (social media, confidentiality, etc.) in violation of the Act has become as predictable as a reality TV episode.

The Board traditionally applies a three-prong test to evaluate whether a policy that does not explicitly restrict Section 7 rights may nonetheless violate the Act. Under this test, the employer’s policy runs contrary to the Act if: (1) employees would reasonably construe the policy to restrict Section 7 activity; (2) the policy was promulgated in response to Section 7 activity; or (3) the rule has been applied to restrict Section 7 activity. It is the first prong – whether or not employees would “reasonably construe” the policy as restricting Section 7 rights – that the Board has used to invalidate many policies that ordinarily would not reasonably be construed as having anything to do with Section 7 rights.

Member Hayes said it best in his dissent in Supply Technologies when describing the Board’s “distortion” of the first prong: “...the test is not whether ambiguous language would reasonably tend to interfere with employees’ Section 7 rights. The test is simply whether the language is ambiguous.”

As private sector unionization continues to decline, thereby reducing the number of employees who typically look to the Board for relief, the Board will likely continue to expand its reach to non-union settings – as it did in this case – by finding that everyday policies present in most workplaces violate the Act.

Photo credit: Alex Nikada

In United Nurses and Allied Professionals (Kent Hospital) and Jeanette Geary, 359 NLRB No. 42 (2012), (pdf) a recent decision benefiting unions, the National Labor Relations Board held that union lobbying expenses may be chargeable to individuals who object to being forced to pay union dues under Communications Workers v. Beck, 487 U.S. 735 (1988) (Beck objectors). First, some background. Union security clauses are provisions in collective bargaining agreements requiring employees to join the union and pay dues as a condition of employment. These types of clauses are only permissible in non-right to work states. In Beck, the Supreme Court held that those who object to paying the required dues may only be charged for the percentage of dues used for purposes of collective bargaining, contract administration, or grievance adjustment.

Despite this clear and narrow directive from the Supreme Court, the Board has now created a broad exception that will likely swallow the rule. In Kent Hospital, the Board held that lobbying expenses may be charged to Beck objectors if those lobbying expenses are germane to collective bargaining, contract administration, or grievance adjustment. Precisely what lobbying expenses may be chargeable was left unanswered by the Board, although it did provide some examples. Specifically, the Board opined that lobbying expenses associated with minimum wage legislation, professional licensing, and state supplements to the WARN act are chargeable to Beck objectors. Conversely, the Board determined that lobbying expenses related to general economic stimulus or “broad social or environmental policies” are not chargeable.

The Board invited briefing on how it should apply its newly-articulated standard going forward. After all the briefing is done, it is likely that the Board will accept unions’ arguments that every lobbying function is meant to improve the lives of its members and, therefore, is related to collective bargaining, and that the Board will therefore determine that the vast majority of lobbying expenses may be charged to Beck objectors.

Photo credit: DigitalZombie

In another decision that affects non-union as well as union employers, the National Labor Relations Board recently ruled that comments posted on Facebook are protected in the same manner and to the same extent as comments made at the "water cooler." In Hispanics United of Buffalo, 359 NLRB No. 37 (Dec. 14, 2012), the Board found that a non-union employer's termination of five employees for Facebook postings was unlawful, awarding the employees full reinstatement and backpay. To learn more about the decision, please see Littler’s ASAP, NLRB Rules Employer’s Termination of Non-Union Employees for Facebook Posts Violated NLRA, by Alan Levins.

By Jeff Place 

Many employers are surprised to learn that employees have a “presumptive right” to wear union insignia and to display pro-union messages on shirts, badges, or buttons while working, even when the employer finds the message objectionable. However, employers can enforce narrowly drawn restrictions against the wearing of union insignia if they demonstrate “special circumstances” that justify the restrictions. In an Advice Memorandum issued on November 28, 2012, the NLRB’s Division of Advice determined that an employer satisfied the “special circumstances” test when it prohibited attorneys in its law department from wearing any kind of t-shirt, including t-shirts displaying pro-union messages.  

The New York State Public Employee Federation (a union) employs a variety of staff personnel, including attorneys in its legal department. The Federation’s non-supervisory employees are represented by United Steelworkers Local 9265. During protracted negotiations for a new labor agreement covering the Federation’s represented employees, the Steelworkers distributed bright red t-shirts to its members with the message “Unionism Begins at Home” printed on the front. The Steelworkers urged all of its members to wear the t-shirts on a particular day, in a show of solidarity. When five out of the six attorneys in the Federation’s legal department wore the t-shirts on the designated date, the Federation’s general counsel sent an e-mail message to the attorneys stating “T-shirts are not acceptable attire in this office. Please do not wear them while you are in this office.”

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By Noah Lipschultz 

In J.W. Marriott Los Angeles at L.A Live, 359 NLRB No. 8 (Sept. 29, 2012), the NLRB again has ruled against an employer’s off-duty employee access rule. A hotel in Los Angeles maintained a rule prohibiting employees from accessing the interior areas of the hotel more than 15 minutes before or after their scheduled shift. The policy further acknowledged there may be exceptions, but required that any exceptions can only arise with prior approval from management, and that failure to obtain such prior approval may result in discipline. The policy expressly applied only to interior areas of the hotel and not to parking areas or other outside non-working areas. In analyzing the rule, the NLRB applied its traditional test to such off-duty access rules, from its decision in Tri-County Medical Center, 222 NLRB 1089 (1976). Under Tri-County, a rule restricting off-duty employee access is valid only if: (1) it limits access solely with respect to the interior of the facility and other working areas; (2) is clearly disseminated to all employees; (3) applies to off-duty employees seeking access to the facility for any purpose and not just those employees engaging in union activity. 

The Board had recently invalidated off-duty access rules for failing the third prong of the Tri-County test by creating exceptions. In Saint John’s Health Center, 357 NLRB No. 170 (2011) the Board invalidated a rule that barred access except for “employer-sponsored” events, and in Sodexo America LLC, 358 NLRB No. 79 (2012), the Board invalidated a hospital’s off-duty access prohibition that made an exception for “hospital-related business.” The Board found fault with the employer’s rule here for the same reason; it was not a blanket prohibition but was instead subject to exceptions, made purely in the employer’s discretion. The Board also found that the rule would “reasonably tend to chill” Section 7 activity, due to the pre-approval condition which, according to the Board, could give management license to deny access on the basis of Section 7 activities. The pre-approval requirement that employees state the purpose of their off-duty visit likewise would tend to chill union activities, according to the Board. 

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By Tracy Stott Pyles

Over the past three weeks, the National Labor Relations Board issued four separate decisions that further signal the Board’s continued focus on employer personnel policies. The Board examined whether employees, unionized and non-unionized alike, would “reasonably conclude” that the facially neutral policies required them to refrain from engaging in protected concerted activities. 

Included within this trifecta was the Board’s first decision specifically addressing an employer’s social media policy. In Costco Wholesale, Inc., 358 NLRB No. 106 (Sept. 7, 2012), the Board determined that the company’s electronic posting rule prohibiting statements that “damage the Company . . . or damage any person’s reputation” was overly broad because it encompassed complaints about the company’s treatment of its employees. The Board largely applied the legal reasoning set forth in the GC’s social media reports (see here, here, and here)– confirming that these reports do provide employers useful guidance on the issue. The Board signaled that if the social media policy is narrowly directed at preventing egregious misconduct, like “sabotage and sexual or racial harassment,” it could withstand scrutiny. On this point, the Board adopted the ALJ’s decision upholding the company’s requirement that employees use “appropriate business decorum” in communicating with others, because the rule promoted “a civil and decent workplace.” It is this juxtaposition between the Board’s findings on the impermissible social media policy and permissible decorum rule that employers should continue to monitor. Perhaps the Board will provide clarification in future decisions.    

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In a ruling that affects both union and non-union employers, the National Labor Relations Board held that an employer must establish a specific legitimate business justification for requiring employees to maintain confidentiality during internal investigations of employee complaints. In Banner Health System d/b/a Banner Estrella Medical Center, 358 N.L.R.B. No. 93 (2012), the Board, by a 2 to 1 majority, held that an employer may not maintain a blanket rule prohibiting employees from discussing ongoing investigations of employee misconduct. According to the Board, such a rule violates Section 7 of the National Labor Relations Act, which protects employees' rights to engage in "concerted activities" for their mutual aid and protection, regardless of whether the employees belong to a union. The Board's decision continues its recent trend of invalidating common employer practices and policies on the stated grounds of protecting Section 7 rights. To learn more about the decision and its potential implications for employers, please continue reading Littler's ASAP, Mum's Not Necessarily the Word: NLRB Complicates Employers' Internal Investigations, by John Skonberg, Earl "Chip" Jones III, and Gregory Brown.

By Tracy Stott Pyles

In Tesco PLC d/b/a Fresh & Easy Neighborhood Market, Inc., a recent 2-1 decision, the Board ruled that a grocery store violated Section 8(a)(1) of the Act when it required its employees to distribute $5 store coupons to customers with an apology for union protest activity near its front entrance and information countering the union’s claims. In reaching its conclusion, the Board applied precedent from the union election context to the organizing scenario at issue in the case.

The issues in the case arose when the union presented the employer, an operator of a chain of grocery stores, with a petition allegedly signed by a majority of employees, stating that the employees wanted to be recognized by the union. The employer declined to voluntarily recognize the union.

The union did not file a petition for a secret ballot election. Rather, the union began distributing leaflets near the employer’s front entrance stating, in part, “[d]espite repeated requests from workers, Fresh & Easy has never recognized a union of their workers – instead choosing to fight their employees as they try to form a union.” Customers were upset by the union protest activity and complained to store management.

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By George O’Brien

Lafe Solomon, Acting General Counsel of the National Labor Relations Board, spoke on June 11, 2012, at the annual meeting of the Connecticut Bar Association and made a number of comments on issues of concern to employers.

Social Media Policies. Solomon said there are now about 100 charges pending at the Board related to social media issues. The Acting General Counsel has taken an active role in handling these cases, both by having decisions about them centralized in the Division of Advice and by issuing three public memoranda wherein he discusses what social media actions are protected by the National Labor Relations Act and the kinds of employer policies that may violate the Act.  Solomon pointed out that while the Board does not issue advisory opinions, his most recent memorandum includes the full text of an employer’s social media policy that the Division of Advice found to be lawful in its entirety.

Solomon acknowledged that the same memorandum contradicts advice that some Regional Directors previously gave to employers that they could cure potential faults in social media policies by including a savings clause telling employees the policy would not prohibit discussions of wages, hours and working conditions or other activities protected by the Act. This point also is discussed in Littler’s recent ASAP. Solomon said that he and others at the Board’s national office in Washington, D.C. decided that “a savings clause no longer protects an unlawful provision” in such a policy.

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By Stephen D. Smith

As Craig Becker’s recess appointment to the NLRB lapsed in early January of this year, the NLRB issued several decisions. Among them was a case demonstrating the importance of engaging in “effects bargaining” related to a reorganization of operations. In Naperville Jeep/Dodge, 357 NLRB No. 183, a three-member panel of the Board ruled that the company failed to engage in proper “effects” bargaining when it closed an automobile dealership employing six mechanics represented by the Machinists Union.

The employer operated two dealerships that it was required to consolidate as a result of Chrysler’s bankruptcy. The employer closed one dealership and offered the six displaced union mechanics jobs at the other dealership, where it employed 14 unrepresented mechanics. There was no dispute that the employer did not bargain over the effects of the closure of the union facility. The employer proceeded on the assumption that by merging the smaller union group into the larger nonunion group, its bargaining obligations would be extinguished.

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By Reid Carron

Good news for employers: initial protected activity will not entitle a repeat offender to reinstatement.  In its decision in Human Services Projects d/b/a Teen Triumph, 32-CA-25262 (February 6, 2012), a Board majority held that an unrepresented employee who had been discharged in violation of the NLRA lost the right to be reinstated when, several months after the discharge, he accosted a former coworker who was still employed by the respondent employer and verbally abused her in a “profanity-laced tirade” about a matter unrelated to his discharge. The Board held that such conduct made the former employee “unfit for further service,” and required the employer to reimburse the employee for lost pay and benefits from the date of discharge until the date that he accosted the former co-worker. The Board denied the request for reinstatement.  

Conduct related to otherwise-protected activity can lose its protection and provide a lawful basis for discharge or a denial of reinstatement if it is “so egregious as to take it outside the protection of the Act, or of such character as to render the employee unfit for further service.” The Board found that the employee’s conduct immediately following his discharge – refusing to leave the premises, challenging a supervisor who ordered him to leave, and ultimately getting arrested – did not fall to that level. The later tirade against a coworker was the conduct the Board found rendered him unfit for further service.

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By Denise Barton Ward

One tenet of NLRB case law is that an employer’s use of permanent replacements renders a lockout in support of its bargaining position unlawful. In Harborlite Corporation, 357 NLRB No. 151 (2011), the Administrative Law Judge relied on this principle to find a lockout in support of an employer’s bargaining position unlawful due to the employer’s statements that it would permanently replace employees. In a somewhat surprising result, the Board agreed the statements were unlawful, but concluded that the lockout itself was lawful. The Board’s separation of statements and conduct, as well as its implicit approval of the employer’s attempt to cure an errant statement, amounts to a welcome Board decision for employers.

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In D.R. Horton, Inc., (pdf) the National Labor Relations Board, by a 2-0 vote, found that an arbitration agreement requiring "as a condition of employment" all employees to agree to waive the right to bring class or collective actions in any forum violated Section 8(a)(1) of the National Labor Relations Act (NLRA), which guarantees the rights of employees to engage in concerted, protected activity. The decision was issued by Board Chairman Mark Pearce and Member Craig Becker on January 3, 2012, the final day of Member Becker's controversial recess appointment. Republican Board Member Brian Hayes was recused and did not participate in deciding the merits of the case. The decision has potentially wide-ranging implications for employers who have required employees to agree to arbitrate their disputes and at the same time waive the right to pursue their claims on a class or collective basis. The decision, however, also leaves open the possibility that agreements that are not "imposed" on employees may yet be enforceable, even if those agreements ban class or collective actions in any forum. Continue reading about this development here.

By Carie Torrence and Sarah Green

As reported on Littler's healthcare employer blog, the National Labor Relations Board recently reversed a 2006 administrative law judge (ALJ) decision that Virginia Mason Hospital was not required to bargain with the union over a flu prevention policy that required nurses to wear a facemask or take anti-viral medication, rejecting the argument that the policy went to the hospital’s “core purpose” of protecting its patients’ health and was narrowly tailored to achieve its purpose.  The Board remanded the case back to the ALJ for consideration of the hospital’s other defenses to its unilateral implementation of the flu policy, and the ALJ issued a new opinion (case 19-CA-30154; JD(SF)-44-11). 

Read the full entry at Littler's Healthcare Employment Counsel blog.

By Jennifer Mora

Recently, in Virginia Mason Hospital, 357 NLRB No. 53, the National Labor Relations Board considered whether a Seattle hospital violated its duty to bargain under the National Labor Relations Act when it implemented a flu-prevention policy that required nurses to wear a mask if they refused to be immunized against influenza. In doing so, the Board reversed the administrative law judge’s (ALJ) holding that the hospital’s decision to implement the policy was permissible because it went to the hospital’s “core purpose” of protecting its patients’ health and was narrowly tailored to achieve its purpose. Continue reading this entry at Littler's Healthcare Employment Counsel.

By Nathan J. Allen

The Board has announced a new approach to the question of whether the filing of a lawsuit to redress unlawful employment practices, when financed by a union prior to a representation election, interferes with a fair election.  Specifically, in Stericycle, Inc., 357 NLRB No. 53, the Board held that a union engages in objectionable conduct warranting a second election when it finances a lawsuit filed during the narrow time period – known as the “critical period” – between the date of the filing of the representation petition and the date of the election, if the lawsuit asserts claims under federal or state wage and hour laws, or other similar employment laws on behalf of employees in the unit.  The Stericycle decision overrules prior Board standards for determining whether union-sponsored lawsuits filed during the critical period will taint election results. 

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Marking the end of Chairman Wilma Liebman's term, the National Labor Relations Board issued three significant decisions at the end of August that overturn long-standing Board precedent. In what may be the most significant of the three, a decision involving the healthcare industry, the Board paved the way for the proliferation of bargaining units by overruling its 1991 decision in Park Manor Care Center, 305 NLRB 872 (1991), and determining that certified nursing assistants ("CNAs") comprise an appropriate stand-alone bargaining unit. Although it involved a nursing home, the Board's decision is not limited to the healthcare industry and fundamentally changes the standard for determining appropriate bargaining units applicable to all employers.  Continue reading this article here.

Photo credit: AlexRaths

In Mezonos Maven Bakery, Inc., 357 NLRB No. 47 (Aug. 9, 2011), the Board took the opportunity to examine the scope of Hoffman Plastic Compounds, Inc. v. NLRB, 535 U.S. 137 (2001), where the U.S. Supreme Court held the Board lacked “remedial discretion” to award backpay to undocumented workers.  The circumstances in Hoffman included an undocumented worker who presented fraudulent work-authorization documents to obtain employment.  The circumstances in Mezonos, however, involved an employer who never asked for work-authorization documents.  Nonetheless, the Board found Hoffman precludes a backpay award to any undocumented worker who was never legally authorized to work in the U.S., regardless whether it was the worker or the employer who violated the Immigration Reform and Control Act (IRCA).  The unlawful employment relationship – to which both the undocumented worker and the employer are party – contravenes explicit congressional policies.  As a result, concluded the Board, under Hoffman, backpay awards are inappropriate.

The Board’s main opinion concedes there may be passages in Hoffman that suggest an alternate opinion.  In their concurring opinion, Chairman Liebman and Member Pearce expand upon these alternatives, but describe the result—precluding backpay to all undocumented workers when the employer is the IRCA violator—as unfortunate.  The main opinion anticipates this reaction and addresses the incongruity by stating that it is the Board’s role to enforce precedent in adjudicatory proceedings and the role of Congress to alter the law in response to the Supreme Court’s decision. 

photo credit: tfofo

On July 26, 2011, in Register Guard, 357 NLRB No. 27 (July 26, 2011), the NLRB issued a decision on remand from the U.S. Court of Appeals for the D.C. Circuit involving a challenge to an employer’s e-mail use and solicitation policy, and its enforcement of the same.  Neither the new Board decision, nor the appellate court opinion changes the precedent set by the original Register Guard decision in December 2007.  In that decision, the NLRB modified then-existing precedent concerning discriminatory enforcement of company rules and policies, announcing a narrower standard for discrimination with respect to rules governing activities or communications.  In so doing, the Board upheld the facial validity of an employer’s policy that prohibited the use of e-mail for “non-job-related solicitations,” acknowledging that an employer could make distinctions in its rules that might adversely affect employees’ NLRA Section 7 rights (such as allowing charitable, but not non-charitable e-mail solicitations), so long as such policies (or enforcement of those policies) did not discriminate along Section 7 or union-related lines.

The initial case involved a challenge to two disciplinary actions the employer took toward an employee under its e-mail use policy.  The D.C. Circuit reversed the Board’s initial ruling, holding that both instances of discipline violated the Act.  The D.C. Circuit noted that, while the employer argued the employee was disciplined for making solicitations on behalf of an organization, rather than on behalf of an individual, there was no basis in the employer’s policy for such a distinction, thus leading to the inference that the enforcement was based on the union-related nature of the communication.  The court observed that neither the company’s written policy nor its explanation in the warning drew a distinction between individual and organizational solicitations, finding that the employer’s rationale was “a post hoc invention” raised only after the General Counsel filed the complaint.  On remand, the NLRB accepted the D.C. Circuit’s ruling in this regard as “law of the case.”

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In Go Ahead North America, LLC, 357 NLRB No. 18 (July 18, 2011), a Board panel consisting of Chairman Liebman and Members Becker and Hayes held that an employer’s objection to union’s promise of the dues waiver was meritorious and ordered that the union’s election victory be set aside and directed a second election.

The case arose out of a union’s effort to stave off defeat in a decertification election by distributing a flyer that stated in part that the union would not seek to collect any unpaid dues owed by the employees.  The decertification petition was filed while the employer, which was a successor to a prior transportation contractor, was bargaining with the union for an initial contract.  The prior transportation contractor had failed in its responsibility to withhold dues in accord with its checkoff agreement with the union.  Consequently, all employees who had signed checkoff authorizations were at least one month, and perhaps two months, in arrears.

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In a decision issued on June 30, 2011, the National Labor Relations Board ruled that Interstate Bakeries Corp. and Teamsters Local 523 violated the National Labor Relations Act (NLRA)’s prohibition against discrimination against employees on the basis of union or nonunion status by protecting the seniority of union-represented employees during a merger of bargaining units, while placing the only non-represented employee being merged into the newly combined unit at the bottom of the seniority list.  Interstate Bakeries Corp., 357 NLRB No. 4 (2011). 

In Interstate Bakeries Corp., certain sales and delivery driver employees working for different brand name divisions were represented by Local 523 in two separate bargaining units.  In late 2005, the company announced that it was consolidating the represented employees’ routes with all sales and delivery drivers at the company.  The company and the union agreed to dove-tail the seniority of the represented employees in the two existing bargaining units, with the labor agreement covering one group of drivers surviving as the agreement for the merged unit.

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By Arturo Ross and Micah Heilbrun

The First Circuit Court of Appeals continued the current Board’s trend of striking down employer policies alleged to be overbroad restrictions on employees’ NLRA Section 7 rights.  In NLRB v. Northeastern Land Servs., Ltd., 2011 U.S. App. LEXIS 12678 (1st Cir. 2011), the First Circuit granted enforcement of the Board’s finding of 8(a)(1) violations and its order compelling the employer to rescind its confidentiality policy, reinstate a discharged employee, and compensate the former employee for lost interim earnings.  The decision is troubling for all employers as it demonstrates the Board’s increasing efforts to police non-union workforce issues and company confidentiality policies. 

In the NLS case, the Rhode Island-based employer provided temporary workers on a contract basis to its clients in the natural gas pipeline and telecommunications industries.  The employer required its employees to sign employment agreements that included a confidentiality provision stating that workers could not disclose compensation terms to third parties, and violations could result in termination.  In 2001, the employer began receiving complaints from one of its employees about his delayed repayments for hotel expenses, and a daily rate payment for use of his personal computer and use of his company-provided cellular phone.  Not satisfied with the employer’s response, the employee aired his gripes to his contact at one of the employer’s clients, in an effort to pressure the employer into caving into his demands.  The employer terminated the employee for violating the terms of the confidentiality provision in his employment agreement.  The employee filed a ULP charge with the Board and claimed retaliatory discharge.

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Employment arbitration provisions are a continually evolving area of the law, with recent cases helping to define new parameters.  There are the class action implications of AT&T Mobility v. Concepcion and now NLRB issues raised by an Administrative Law Judge’s decision in Supply Technologies, L.L.C., 2011 NLRB LEXIS 273 (May 31).  In Supply Technologies, the employer instituted an alternative dispute resolution program with a final arbitration step.  The company’s “Total Solution Management (TSM)” contained three documents: Official Rules, Agreement to Use, and Questions and Answers.  The employer terminated approximately twenty employees who failed to sign the TSM.  The Administrative Law Judge found the discharges unlawful because the TSM policy itself was unlawful.  Although the employer argued that the policy stated employees were free to “file a charge or complaint with a government agency,” the ALJ found the additional language requiring an employee who files a charge with an administrative agency to waive his or her right to remedial relief rendered that right meaningless and had a chilling effect on employees’ willingness to exercise the right.  Moreover, the ALJ found the three documents comprising the TSM were entirely inconsistent in whether this right existed at all; the ALJ pointed to other provisions of the program that stated “the only claims” employees could bring outside of the TSM were in regards to criminal claims and claims for workers’ compensation or unemployment benefits and that all other claims “must be brought under the TSM program.”  And, the ALJ noted, the program had no express exception for filing a claim with a government agency, such as the Board, in these additional provisions.  The ALJ therefore found the policies as a whole “rather ambiguous” and “rife with contradictions and inconsistencies regarding” the rights of employees.  As employers take a new look at their arbitration provisions for compliance with other employment areas, such as class action waivers, it may be a good time to ensure the policies pass scrutiny on NLRB issues as well.

This entry was written by Denise Barton Ward.

In Sheet Metal Workers Local 15 (Brandon Regional Medical Center) (May 26, 2011), the NLRB ruled that a union’s display of a large inflatable rat at the hospital worksite of a secondary employer was lawful. The case dates back to 2006, when Brandon Regional Medical Center filed charges under Section 8(b)(4)(ii)(B) of the NLRA based on the union’s act of staging a “mock funeral” on public property in front of the hospital, with union members carrying a fake casket, dressed in grim reaper costumes, and patrolling back and forth. The union’s activities were aimed at the hospital’s use of contractors with whom the union had disputes. Section 8(b)(4)(ii)(B) makes it an unfair labor practice for a union to “threaten, coerce, or restrain any person engaged in commerce or an industry affective commerce, where...an object thereof is...forcing or requiring any person to cease doing business with any other person.” The touchstone of such secondary violations has been the coercive nature of the behavior at issue. Conduct more akin to picketing or patrolling had been deemed coercive and unlawful, whereas conduct such as handbilling, even if directed toward the same ends, was deemed lawful persuasive – as opposed to coercive – behavior within the meaning of that section. Because the Board initially decided the mock funeral violated Section 8(b)(4)(ii)(B), it found it unnecessary to pass on the hospital’s allegation that the union violated the same provision by its display of a 12 foot wide by 16 foot tall inflatable rat 100 feet from the hospital’s entrance. The rat was identified as the nonunion contractor of the hospital, and the union distributed leaflets attacking the contractor as a “rat.”

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In Mental Health Association, Inc., 356 NLRB No. 151 (Apr. 29, 2011), the NLRB overturned an employer’s election victory primarily because of election-day actions by the employer.  Among other things, on election day, the employer limited employee access to the facility to one employee entrance.  The employer also stationed openly anti-union employees at that entrance and gave them control over it for a substantial portion of the voting period.  In addition, the employer hired security personnel, erected a fence around part of its parking lot, and posted “private property” signs, allegedly without evidence of a security threat.  The NLRB concluded that the totality of this conduct “tended to interfere with employees’ free and uncoerced choice in the election,” setting aside the election results and ordering a new election.

The union asked the NLRB to rescind the long-standing presumption that elections will be held on employer premises and to replace it with a presumption that an election will be held at a neutral site unless the parties agree otherwise.  The union asked alternatively that the NLRB adopt a rule that a re-run election be conducted at a neutral site in any case in which an election is set aside because of election day misconduct.  The NLRB declined to do so:

Chairman Liebman and Member Pearce observe that this case illustrates some of the shortcomings of the [NLRB’s] current practices regarding the siting of elections. They are not prepared at this time, however, to deviate from the [NLRB’s] current practice of leaving the determination of the appropriate method and location for initial and rerun elections to the discretion of the Regional Director.  

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Several recent cases issued by the National Labor Relations Board continue to reflect a consistent majority view with respect to representation cases and unfair labor practice matters.  In Fiskardo Estiatorio, Inc. d/b/a Thalassa Restaurant, 356 NLRB No. 129 (March 31, 2011), the Board held that the employer, a New York City restaurant, had engaged in a host of Section 8(a)(1) violations of the NLRA, including interrogating, threatening and attempting to arrest an employee because he and a group of 20 to 25 nonemployees entered the restaurant during evening dining hours to deliver a letter protesting the employer’s alleged labor law violations. The employer’s wait staff had been expressing dissatisfaction over their belief that they were not getting all the tips left by the customers.  Employees advised restaurant management of the issues, and the wait staff consulted with the Restaurant Opportunity Center, an advocacy group, in New York City that organizes restaurant workers for workplace justice campaigns. 

Although the legal standard involving Section 8(a)(1) allegations was not in dispute, there was a significant factual disagreement.  When the dust settled, the administrative law judge and the Board majority accepted the employees’ version of events.  The majority stated that there was no evidence that the group disturbed the handful of patrons present, blocked the ingress or egress of any individual, was violent or caused damage, or prevented any employee from performing his work. Thus, the activity remained protected at all times.  This case underscores the importance of the credibility of witnesses and the cohesion of each witness’ version of the events.

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NLRB Chairman Liebman and Members Pearce and Hayes issued a decision on March 18, 2011 in Buonadonna Shoprite, LLC that employers will likely consider quite reasonable.  On the surface the case was unassumingly simple:  The employer sought to interview an employee regarding an allegation that he had sexually harassed another employee.  The usual shop steward was present, but the steward stopped the interview until the union representative could attend.  Upon learning the union representative would be unavailable for the next four days, the employer again requested to proceed with the interview with the shop steward present.  Despite speculation that the current Board may expand Weingarten rights, the Board upheld the administrative law judge’s finding that the employer was not obligated to defer the interview until the union representative was present; the presence of the shop steward was adequate.  The administrative law judge, however, also found the employer violated the Act when it refused to let the employee call another union representative for advice after the second request to interview the employee with the shop steward present.  The Board, somewhat surprisingly, disagreed.  Rather, the Board found the employer was denied its due process rights, as the complaint did not allege and the general counsel did not contend the employer was required to permit the employee to consult with a second union representative by telephone prior to participating in the investigatory interview.  The Board, therefore, dismissed the complaint.

In Mathews v. Denver Newspaper Agency, Case No. 09-1233 (10th Cir. March 16, 2011), the Tenth Circuit Court of Appeals held that an arbitration decision did not preclude plaintiff from subsequently litigating discrimination claims in court.  The plaintiff was demoted after a complaint of harassment was made against him, and he subsequently challenged his demotion under his collective bargaining agreement’s non-discrimination clause.  The CBA’s non-discrimination clause also referred to state and federal laws prohibiting such discrimination.  The CBA’s dispute resolution procedure provided that disputes under the CBA, “including all disputes involving discharge or discipline . . . shall be submitted to final and binding arbitration.”  Notwithstanding that language, the parties agreed that employees could opt to litigate disputes in a judicial forum, and plaintiff Mathews had, in fact, previously done so. 

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The Board recently expanded its protections for union bannering by concluding that a union display of stationary banners was not a violation of the NLRA’s prohibition against secondary boycotts even where the “primary” and “secondary” employers shared a common job site. The union in Southwest Regional Council of Carpenters (New Star General Contractors) (pdf) placed a large banner at the secondary employer’s worksite to publicize the union’s dispute with the primary employer. The union’s goal was to pressure the secondary employer by publicly “shaming” it for doing business with the primary employer during an ongoing union dispute. In this case, the Board ruled that the union’s bannering at a common worksite (a “common situs”) was not an unfair labor practice and did not “threaten, coerce or restrain” the secondary employer’s workers.

The Board’s recent decision is significant because it permitted a union to publicize its dispute with the primary employer at a “common situs” shared job site where several other companies were also working. In reaching its decision, the Board majority (Chairman Liebman and Members Becker and Pearce) cited its recent 2010 decisions, finding that a union’s stationary banners near a secondary employer’s jobsite did not amount to illegal picketing of the secondary employer because it did not “induce or encourage” employees to stop working and did not otherwise signal to employees to engage in a work stoppage. Member Hayes dissented, restating his position from the previous cases that the stationary bannering displays were unlawful as coercive conduct. Member Hayes went further in New Star General Contractors, viewing the union’s banner both as unlawful picketing and as intending to communicate a message for the secondary employer’s workers to engage in a work stoppage at the common worksite.

The significance of this decision likely will be seen on a wider scale where unions engage in continued bannering efforts directed at neutral secondary employers where the primary employer’s workers are on the “common situs” shared job site. The Board’s reasoning permits unions to publicize disputes with primary employers without well-defined limitations requiring unions to avoid disruption or unlawful appeals to the workers of secondary employers. The Board has now established a pattern of decisions condoning union tactics of placing banners at any entrance to a common worksite, regardless of where the primary employer’s workers enter and exit the jobsite. It is unlikely that the Board’s current view of the union bannering strategy will be limited unless reversed by a federal appellate court.

Despite the Board’s current composition and recent slant, it remains advisable for employers to consider continued use of a reserved gate system when facing union bannering efforts. The established practice of reserved gates for primary employers facing unions publicizing labor disputes permits separation of secondary employers’ workers at the “common situs” job site and may help minimize the opportunities for unlawful work stoppages or slowdowns.

This entry was written by Arturo Ross and Micah Heilbrun.

Photo credit: Wissmann Design

The NLRB’s February 11 decision in O.G.S. Technologies, Inc., 356 NLRB No. 92 (2011), seemingly sets forth a broad requirement that employers bargain over subcontracting decisions, even where new technologies and decisions about major capital investments are involved.  If followed in future cases, the decision will result in a substantial narrowing of the scope of the “core entrepreneurial decisions” that are excluded from an employer’s duty to bargain under the U.S. Supreme Court’s decision in First National Maintenance Corp. v. NLRB, 452 U.S. 666 (1981).

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On January 31, 2011, the National Labor Relations Board adopted a finding that Fresh & Easy Neighborhood Market violated the NLRA by maintaining an overbroad no-solicitation rule, interrogating employees, and creating an impression of surveillance. The Board also dismissed two claims that employees were unlawfully discharged for engaging in protected activity. Fresh & Easy Market operates convenience stores in Nevada, Arizona and California. The case involved one of the company’s convenience stores in Las Vegas, Nevada, which had been targeted for organizing by the United Food and Commercial Workers (UFCW) during 2009.

As part of the UFCW’s campaign, union organizers made unannounced visits to the homes of Fresh & Easy Market’s Las Vegas employees, which prompted several employee complaints. Managers informed the employees that they could send written complaints to the local UFCW office and to the company’s legal department, and several employees chose to do so. In following up on reports of unwelcome and confrontational home visits by the UFCW’s organizers, the Las Vegas store manager asked two employees whether they had sent complaint letters or had “spoken to the Union.” The NLRB General Counsel challenged this single conversation as unlawful interrogation that gave the employees the impression that their actions were under surveillance.

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In a recent case affecting health care employers uniquely, the NLRB decided in Correctional Medical Services, Inc., 356 NLRB No. 48, that employees’ picketing was protected activity, despite the fact that the union committed an unfair labor practice by not giving proper notice of picketing.  In doing so, the Board reversed its earlier ruling in the case and found that Correctional Medical Services, Inc. (“CMS”) unlawfully threatened, interrogated, and terminated its employees in violation of the National Labor Relations Act for their participation in the picketing.

Continue reading this entry on Littler's Healthcare Employment Counsel blog.

With its December 6 decision in Dana Corp., 356 NLRB No 49, (pdf) the Obama Board has given its approval to broader use of agreements between employers and unions designed to encourage the organization of an employer’s non-represented workforce. The decision represents a step forward in the Obama Board’s agenda for changing existing interpretations and applications of U.S. labor law in ways that labor organizations hope will ensure its continuing relevance and vitality in the twenty-first century. For some, the decision suggests that the Board may be privileging the institutional interests of labor unions over the individual or even collective interests of the employees whom federal labor law was designed to protect.

The UAW represents Dana Corporation’s employees in nine bargaining units covering some, but not all of the company’s facilities. In 2003, Dana and the UAW entered into an agreement wherein Dana committed that it would remain neutral if the union launched an organizing drive at any of the unorganized plants, provide the union with a list of the names and addresses of employees working at the plant upon request, provide union organizers with access to the non-working areas of the plant for the purpose of organizing employees, and recognize the union without an election if the union presented authorization cards signed by a majority of the employees at the plant, as verified by a neutral fact-finder. This type of sweeping neutrality and card-check agreement, though uncommon, has generally survived legal challenges.

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As we have covered extensively on this blog, the National Labor Relations Board continues to seek out opportunities to effectuate pro-labor initiatives and overturn Bush-era Board holdings.  Indeed, the current Obama Board has never been shy about its expansive views pertaining to Section 7 rights under the National Labor Relations Act.  The present NLRB has both informally voiced and evidenced through its decisions an overt willingness to promote union access efforts.  Now, it seems that employers may also need to be wary of more “creative” (and less publicized) means by which the Board is seeking to achieve its agenda items.

The Board recently issued a decision in Roundy’s Inc., 356 NLRB No. 27 (November 12, 2010).  The issue was whether the employer lawfully prevented non-employee union representatives from handbilling on claimed private property.  Specifically, union advocates were publicizing a dispute between the union and employer over the use of contractors; the union alleged the contractors were not applying area wage standards.  In response, the employer prevented the distribution of handbills at 26 of its store locations.  Initially, the Administrative Law Judge found that the company had, indeed, violated Section 8(a)(1) of the NLRA by its refusal to permit the union agents’ handbilling activities at the various stores.  The case, however, was remanded by the NLRB (which, at that time, was a Bush Board) to permit further evidence regarding the employer’s claim that it had a property interest that afforded it the legal right to exclude the union agents from the places where they were engaged in handbilling.

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Continuing the trend that we have blogged about previously, the NLRB has recently issued two decisions that implement another concept contained in the failed Employee Free Choice Act – enhanced penalties for labor law violations.  These decisions also follow a movement throughout the Obama Administration to enhance penalties against employers for legal transgressions.

In one case, Kentucky River Medical Center, 356 NLRB No. 8 (Oct. 22, 2010) (pdf), the NLRB announced a change in the long-standing practice of awarding simple back pay awards calculated on a quarterly basis.  In Kentucky River, the NLRB announced that all back pay awards would be subject to a daily compound interest penalty.  This is a change that has been contemplated by the NLRB on and off for the last twenty years, but has not been adopted until now.  Significantly, this change is retroactive for all pending cases as well as for all cases going forward.  What this change means in real terms is that the penalty to an employer who is found to have wrongfully discharged or otherwise financially harmed a complainant is greater than before this decision was issued.  Practically, given the long period of time it typically takes to contest an adverse NLRB determination, employers may feel pressure to settle the case rather than continue to defend themselves due to the cost of daily compounding interest on the back pay amount.  Other employers may be leery of taking justified actions that could trigger a NLRB investigation due to the potential of an enhanced penalty.

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There is a little bit for everybody in the NLRB’s decision in McGraw Hill Broadcasting Company, Inc., 355 NLRB No. 213 (2010).  The question was whether McGraw Hill had an obligation to bargain over the decision to lay off three part-time employees, and the effects of that decision, despite a contract provision addressing layoffs.  The Board answered, “no,” with respect to decision bargaining, but “yes,” with respect to effects bargaining.

McGraw Hill ran a television station in San Diego, California.  In December 2007, the company cancelled a Sunday morning newscast because of low ratings.  This resulted in reduced hours for some full-time employees.  The contract with the union required that the hours of part timers be limited to a specific percentage of full-time hours.  The reduction in full-time hours negatively impacted this percentage, and the company decided that it needed to lay off three part timers in order to comply with the contract.

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In a recent case, the Board confirmed the maxim that if you make a factual assertion during negotiations, a union has the right to information to determine the validity of that assertion. In Kraft Foods, 355 NLRB No. 156 (2010), the Board determined it was an unfair labor practice for the employer to refuse to provide information regarding benefit plans in effect at other facilities. The Board's rationale was grounded on the fact that in years past, the employer had compared the benefits and compensation available at the facility in question to other facilities it owned. Therefore, the Board concluded, the employer made this information relevant.

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As the NLRB regained its five-member status, it set to task at the back log of cases awaiting it. On August 27, 2010 it decided Independence Residences, Inc., 335 NLRB No. 153 (2010), a 2003 representation case that even Chairman Liebman noted has languished before the Board for “an unconscionably long time.” In 2003, the Union of Needletrades Industrial and Textile Employees (UNITE) began organizing at Independence Residences, Inc., a private nonprofit entity, and filed a representation petition with the Board. A majority of employees voted for the union in the subsequent election, and the employer filed objections seeking to set aside the election results, arguing that a New York state law barring the use of state funds for certain union campaign activities prevented a fair election. The heart of the issues in Independence Residences was whether New York State Labor Law Section 211-a interfered with the employer’s ability to communicate with employees during the election campaign, warranting the setting aside of the election results.

New York Labor Law Section 211-a provides:

no monies appropriated by the state for any purpose shall be used or made available to employers to: (a) train managers, supervisors or other administrative personnel regarding methods to encourage or discourage union organization, or to encourage or discourage an employee from participating in a union organizing drive; (b) hire or pay attorneys, consultants or other contractors to encourage or discourage union organization, or to encourage or discourage an employee from participating in a union organizing drive; or (c) hire employees or pay the salary and other compensation of employees whose principal job duties are to encourage or discourage union organization, or to encourage or discourage an employee from participating in a union organizing drive.

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The National Labor Relations Board (NLRB or “Board”) recently decided that a union violated the National Labor Relations Act (NLRA) by intimating that employees were still obligated to pay union dues and fees after a collective bargaining agreement (CBA) had expired, implicitly affirming the rights of the employer to explain employees’ post-contract options. The controversy in SEIU Local 121RN (Pomona Valley Hospital Medical Center), 355 NLRB No. 40 (2010) stemmed from an expired CBA between the Service Employees International Union (SEIU), which represented approximately 1,000 registered nurses, and the hospital employer. After the CBA – which contained a union security clause – terminated, the employer and an anti-union nurses group informed the employees that they were no longer required to pay union dues and fees and that they could resign their union membership and/or revoke their dues checkoff authorizations. In response, the SEIU issued flyers that sought to counter this “misleading and incorrect information.” With respect to dues and fees, the poster informed employees that:

You may have been mislead [sic] into believing that you are not obligated to pay dues and fees during the period of negotiations. This is untrue and retroactivity may occur prior or upon ratification of the contract. Please ask yourselves why all the anti leaders are still paying dues. Could it be they don’t want the possibility of owing more in a lump sum?

DUE [sic] AND FEE [sic] OBLIGATIONS REMAIN INTACT AND MAYBE [sic] COLLECTED PRIOR OR UPON RATIFICATION OF THE CONTRACT. WHEN YOU ARE NOT A MEMBER IN GOOD STANDING, YOU FORFEIT YOUR VOICE, RIGHTS TO PARTICIPATE IN UNION EVENTS AND FORFEIT YOUR VOTING PRIVILEGES. (emphasis in original)

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