Duty To Provide Employee Witness Names And Pro-Union Supervisory Election Interference On This Week's NLRA Fare

Posted by Mark Theodore on March 18, 2012

The slow pace at the NLRB continues this Spring, as only one or two decisions are issued each week.  Recent decisions, one from the NLRB and one from the District of Columbia Court of Appeals, are worth noting because they illustrate recurring themes under the NLRA.

 

Protecting The Identity Of Employee Informants

In Alcan Rolled Products-Ravenswood LLC, 358 NLRB No. 11 (February 27, 2012).pdf the NLRB addressed a common situation involving employees who report on other employees in a unionized workforce.  A bargaining unit member had two accidents while driving a forklift, both of which caused property damage.  The employee in question was tested for drugs and alcohol; the drug test was negative, while the test revealed the presence of alcohol, but apparently not at high enough levels to warrant action under the policy.  While the employer was investigating the second accident, several bargaining unit members expressed concern for safety working with the employee, with one stating that the employee was in need of help.  The supervisor in charge had assured all bargaining unit members that the discussions were "off the record."

During a meeting about the accidents, the employer informed the union that it intended to discharge the employee for the accidents, and mentioned that some bargaining unit members had expressed concern about working with the employee. The union requested the names of the employees; the employer refused to provide the information.  In doing so, the employer advanced two reasons as to why it did not have to disclose the information.  First, that the employer did not intend to rely on the information because whatever the co-workers had told it was not relevant to the discharge.  Second, that the information was confidential.

The NLRB adopted the Administrative Law Judge's conclusion that the employer violated Section 8(a)(5) of the Act, which requires employers to bargain in good faith, by not trying to reach an accommodation with the union over the provision of the employee names.

The ALJ ruled that employer "did not forswear reliance on the information" obtained from co-workers mainly due to its written responses to the union during the grievance process.  In these letters, the employer stated that the discharged employee's actions "put other employees and you at risk."  The takeaway here is that employers should be very careful what they put in written responses to the union, as it sometimes can be perceived as contrary to a position taken with respect to an information request.

The employer also asserted that it did not have to provide the names of the employee witnesses because the information was "confidential," specifically, that it had given assurances that the conversations were off the record.  In rejecting this assertion, the ALJ noted that an employer's assurances of confidentiality to an employee are not enough to cloak the employee's identity as "confidential."  The ALJ noted in a footnote:

I do not criticize the efficacy of this management approach (although it is worth bearing in mind that confidentiality can also encourage dishonest reports, as the informants need never face scrutiny).  But management's willingness to grant confidentiality cannot, by itself, create a legitimate employer interest in confidentiality for purposes of avoiding disclosure of otherwise relevant information to a union.

 

Nonetheless, the ALJ deemed the identity of witnesses to be confidential due to a long line of NLRB decisions dealing with the situation.  Employers have legitimate confidentiality concerns to foster employee reporting of safety violations and criminal conduct, and to protect employees from the potential threat of retaliation.  That the information was confidential, though, did not absolve the employer of any responsibility.  If information is deemed to be "confidential" then the employer must attempt to reach an accommodation over the disclosure of the information by bargaining with the union.  The employer in the case asserted that there was no accommodation that would have been acceptable, but the ALJ concluded this was preemptive and that the employer's failure to try was what constituted a violation of the Act.  Thus, the ALJ gave some guidance:

While I agree that is far from clear that the Union would have accepted any offer of accommodation, the Respondent's duty was to make the effort.  It could have, for instance, offered to provide the identities to a designated union official, subject to bargained restrictions on the Union's use and dissemination of the information.  It could have offered to provide the identities subject to a confidentiality agreement to an International Union unaffiliated with the facility for use interviewing the employees.  Certainly there are other potential accommodations that the parties could discuss.

The case does not break any new ground.  It does, however,  illustrate a common problem with the response to an information request made by a union.  An employer should never outright reject an information request.  Information requests can be irksome if for no other reason than it often seems that the union does little or nothing with the information.  Simply denying an information request on confidentiality grounds brings some risk of a violation of the Act.   First, in order for the information to be "confidential" it must be proven that there is a legitimate employer interest in it; we know from this case that merely assuring employees that their identities will remain confidential is not enough.  There must be an articulable basis.  Second, even if the information is confidential, the employer still must bargain over the the circumstances under which it is disclosed.  In other words, just because it is confidential does not privilege an employer from ever turning it over to the union.  There is no requirement that the parties actually reach an accommodation, just that they try.  

Supervisors And The Representation Election Process

A recent DC Circuit Court of Appeals case illustrates another recurring theme under the NLRA: the importance of understanding which individuals in a workforce are supervisors within the meaning of the Act.  As a general rule, supervisors are excluded from the voting unit.  Individuals who fall within the statutory Section 2(11) definition of "supervisor" often possess enough authority over employees that they can violate the Act.  It is important to understand which folks are supervisors before organizing occurs as the employer in  Veritas Health Services, Inc. v. NLRB, No. 11-1107, (DC Cir. March 13, 2012).pdf recently found out.

in Veritas, the employer hospital underwent an organizing drive targeting the nursing staff.  At least some of the union adherents were "charge nurses" (the equivalent of leadpersons or forepersons in other workplaces), with two in particular, who "actively encouraged subordinate registered nurses to support the Union."  These activities included telling nurses that they "need" to attend union meetings and "need" to sign an authorization card.

The union gained enough support to file a petition for an election.  During the processing of the petition, the parties agreed that the charge nurses were supervisors and removed them from the voting unit.  The charge nurses then switched sides and campaigned for the employer.  The employer lost the election and challenged the results based on the charge nurses/supervisors pro-union conduct.  The DC Court of Appeals rejected this claim, finding that under NLRB authority the conduct did not interfere with the freedom of choice.  Specifically, the Court found that the passage of time (the pro-union conduct was pre-petition) and the fact that the charge nurses campaigned for the employer such that "registered nurses would have no reason to feel pro-Union coercion or interference from the [charge nurses'] prior conduct."  

Again, not anything new, however it does illustrate the importance of understanding which individuals in a workforce are supervisory.  As the Court noted:

 ...supervisors do not usually engage in pro-union activities against the wishes of management.  But the issue of pro-union conduct by a supervisor sometimes arises when it was unclear or disputed at the time of the pro-union activity whether the employee was a statutory supervisor.

It is often the case that employers do not know (and have not considered) whether certain classifications within a workforce are supervisory until an NLRB petition is filed.  By that time, however, it is often too late.  If an employer grants a particular classification authority over employees, it should also do an analysis of whether such position would be considered supervisory under the Act, and understand the potential consequences.

 

 

The Lull Before The Storm: Blizzard Of NLRB Activity Coming

Posted by Mark Theodore on July 29, 2011

The mid-point of Summer has passed.  Although the NLRB has not issued a major decision in several weeks, the agency has not been slacking off this Summer.  In a typical year, August and September are the busiest months for the NLRB, because the federal government's fiscal year ends September 30.  During the final weeks of the fiscal year the NLRB attempts to push out as many decisions as it can.  The agency is largely statistically driven, and so more decisions means a greater justification for a renewed or increased budget.

This, of course, is not a typical year.  The current NLRB has a very active, if not activist, agenda.  There not only are a number of potentially far-reaching cases it has yet to decide, but the agency also has proposed rulemaking to drastically upend the current manner in which representation elections are held.  Add into the mix Chairman Liebman's appointment is set to expire on August 27, one can expect a storm of activity from the NLRB in the coming weeks.  Here is a snapshot of the important cases and the rulemaking initiatives currently pending: 

  • Speciality Healthcare (NLRB Case No. 15-RC-8773).  In this case, the NLRB wondered aloud whether it could set a presumptive rule for the appropriateness of bargaining units in certain segments of the healthcare industry. The problem, of course, is that anyone who has worked in business environment knows that there is no uniformity to how an employer structures its business, even within industries.  A decision holding otherwise will make it much easier for unions to organize because it will remove Section 9(b) of the Act's requirement that the NLRB actually decide, on a case by case basis, the appropriateness of a unit.  We posted in detail on this important issue in March after we filed a brief on behalf of Retail Industry Leaders Association. 
  •  Lamons Gasket Company (NLRB Case No. 16-RD-1597).  In this case the NLRB may revisit (read- overturn) the exception to the voluntary recognition bar set forth in Dana Corp Metaldyne, 351 NLRB 434 (2007).pdf.  In Dana, the NLRB set a rule where employees may challenge voluntary recognition of a union by their employer by filing a petition for an election within a certain period of time.  With all the discussion about the NLRB's processes, the NLRB in Dana pointed out something that sometimes gets lost in the debate.  "Finally, although critics of the Board election process claim that an employer opposed to union representation has a one-sided advantage to exert pressure on its employees throughout each workday of an election campaign, the fact remains that the Board will invalidate elections affected by improper electioneering tactics, and an employee's expression of choice is exercised by casting a ballot in private.  There are no comparable safeguards in the voluntary recognition process."  Id. at 439. 
  • Hawaii Tribune Herald (NLRB Case No. 37-CA-7043 et al.).  This is another case where the NLRB invited interested parties to file briefs about whether it should it should change its 32 year rule that witness statements made to the emloyer need not be turned over to the union prior to an arbitration hearing. As noted in the previous post on this issue, the NLRB's rule is designed to protect the witnesses from intimidation.  A reversal of this decades old rule will change the way arbitration cases are handled.
  • D.R. Horton (NLRB Case No. 12-CA-25764).  The NLRB invited briefs on the issue of whether an employer's requirement that each employee sign an arbitration agreement which expressly waives the right to class action relief violated Section 8(a)(1). We previously posted on this important issue. The issue in this case really comes down to whether "all" group activity, no matter what the nature, is also "protected, concerted" activity under Section 7 of the NLRA.  We filed a Brief for the Retail Industry Leaders Association -- Amicus Curiae.pdf on this issue.  While one can certainly see the similarities between Section 7 activity and employees who wish to bring a class action against their employer, there are also important distinguishing factors.  The entire NLRA concept of group activity is designed to have employees acting in concert toward a common goal; there is interaction and cohesiveness. Under the NLRA, the group must achieve majority status before it can act on behalf of the whole.   In many class actions, the opposite is often true.  The vast majority of employees are not even aware the lawsuit is pending.  In many cases the "class representatives," often a tiny fraction of an overall workforce, can settle the entire matter (for their own benefit, of course), and then notify the rest of the employees what happened.  There are great differences between the two types of activity.
  • Rulemaking. Of course, the NLRB has moved forward with its efforts to force "quickie elections" on employers through rulemaking.  The NLRB held hearings on the matter on July 18-19.  The changes, if promulgated, would reduce the amount of time between the filing of a petition and the election from about 42 days now to far fewer days.  The need for such drastic change is mystifying.  The NLRB itself in its own  Performance and Accountability Report FY 2010.pdf stated that it met or exceeded its strategic goals for processing representation petitions, which raises serious questions of the necessity for such drastic changes.  The U.S. Chamber of Commerce has drafted a very good Fact Sheet On Quickie Elections.pdf detailing the proposed rules, and how they would change the current process.  Comments on the rulemaking are due August 22, 2011, so employers who wish to get involved should draft comments to the NLRB (there is a draft letter in the U.S. Chamber's materials).

As one can see, a storm of NLRB activity is headed this way.  We will certainly be monitoring it as its clouds continue to gather.  Employers need to prepare for the possibility that many areas of NLRB law and process, some decades old, will be changed in the coming weeks.  We will, of course keep you posted on all developments as they occur.

 

NLRB Acting General Counsel Clarifies Duty to Provide Information in Bargaining

Posted by Scott Faust on May 18, 2011

In a May 17 memorandum, NLRB Acting General Counsel Lafe Solomon furnished guidelines to Regional Directors concerning parties’ obligation to provide information in collective bargaining negotiations. 

GC Memorandum 11-13  traces the development of two different analytical frameworks for assessing a party’s obligation to provide requested information to its bargaining counterpart.  The first applies to cases involving a union request for financial information in response to an employer’s general claim of inability to pay certain wages or benefits.  The second applies to cases involving a party’s request for specific information related to more limited bargaining claims by its bargaining counterpart.  The principal purpose of the memo is to stress the importance of distinguishing between these two types of cases and applying the proper analytical framework to each. 

General Principles

Basic principles governing both parties’ obligation to produce requested information in bargaining include the following.

  • The duty to bargain in good faith imposes on both parties a parallel obligation to provide relevant information upon request. 
  • Information concerning employees’ terms and conditions of employment is presumptively relevant. 
  • The party making the request bears the burden of demonstrating the relevance of the requested information. 
  • The threshold for relevance is a liberal, discovery-type standard; the requested information must merely have some bearing on the issue between the parties, and the requesting party need show only potential or probable relevance.

In NLRB v. Truitt Mfg. Co., 351 U.S. 149 (1956), the U.S. Supreme Court  held that an employer violated Section 8(a)(5) of the Act by refusing to provide the union with financial information relevant to the employer’s claim that it could not afford a wage increase sought by the union.  In so ruling, the Court also emphasized more broadly that, when either party makes factual assertions in bargaining, it may be obligated to share information relevant to those specific factual assertions.

Analysis of Union Requests for General Financial Information

Truitt made clear that the assessment of whether an employer has exposed itself to a union request for financial information by claiming an inability to pay -- as opposed to an unwillingness to pay -- turns on the particular facts and context of each case.  No “magic words” are required for an employer to be deemed to have claimed financial hardship.  The obligation to provide general financial information arises whenever an employer’s statements and actions convey an inability to pay, and the Board and courts will evaluate an employer’s statements in the context of the particular case at hand.  GC Memorandum 11-13 observes that such case-specific analysis has led to seemingly inconsistent results, but it also recognizes that there is no bright-line test to clarify the fact-intensive analysis mandated by Truitt.

Analysis of a Party’s Request for Specific Information Related to Bargaining Claims

At times, an employer may base a bargaining position on factors that are related to certain business conditions but do not constitute an inability to pay, e.g., a need to maintain competitive pricing.  In such cases, the Acting General Counsel notes that the Board and the courts have not always been consistent in their analytical approach.  These are the types of cases with which GC Memorandum 11-13 is most concerned, and the memo advises Regional Directors not to overlook the significance and relevance of information requested in response to bargaining claims that do not rise to the level of a claim of inability to pay.  Such limited claims may well trigger a valid request for information specific to the particular claim at issue.

In this regard, the memo takes issue with the Board’s 2006 decision in North Star Steel Co., 347 NLRB 1369-70 (2006), in which the Board found that a union’s request for information regarding the employer’s competitors was not relevant because the employer had not claimed inability to pay.  Instead, the employer claimed an inability to compete.  In ruling that the employer had no obligation to produce a list of competitors, the Board restricted its analysis to whether or not the employer had claimed an inability to pay.  The memo criticizes the Board for not considering the employer’s claim of competitive disadvantage, and instead, confining its analysis to whether the employer had claimed financial hardship.

The memo cautions Regional Directors not to evaluate all claims for requested information on the basis of whether an employer has claimed financial hardship.  Rather, it advises the Regions to differentiate between requests for general financial information made in response to claims of an inability to pay from other more limited information requests made in response to bargaining claims that may be subject to specific evaluation.

Conclusion

The GC’s memo sensitizes Regional Directors to:

  1. the importance of evaluating requests for information on the basis of a fact-specific analysis of the requested information’s relevance; and
  2. the distinct analytical frameworks to be applied to cases involving an employer’s asserted inability to pay and those involving more limited justifications that do not rise to the level of financial hardship. 

Employers confronted with union information requests must evaluate the specific relevance of the request to bargaining issues on the table or to bargaining positions that the employer has taken in the course of negotiations.  The union bears the burden of demonstrating the relevance of any requests it makes, but in evaluating any such explanation, the employer should apply a liberal, discovery-like standard of relevance.  If the employer does not do so, the Board will, and the employer will be exposed to the risk of an 8(a)(5) charge.

NLRB Hints At Broader Agenda In Witness Statement Case

Posted by Mark Theodore on March 21, 2011

Employers faced with evidence of employee misconduct often conduct investigations.  In many cases, there is no direct evidence.  Oftetimes, there exists conflicting versions of events, and so witness statements are obtained.  The employer then can consider all the aspects of what happened, taking into consideration who saw what, and the candor of employees.  For over 32 years, such witness statements have been considered confidential material that does not have to be turned over to a union during an ensuing grievance.  The reasons for this rule are pretty obvious and logical:  witnesses are almost always reluctant, and disclosing statements they give in an internal company investigation can subject them to undue pressure, and even coercion, from fellow employees and union representatives.

Despite the thirty plus year precedent, the Board may be considering reversing this rule as it continues to march forward with its new agenda.  As reported earlier in this blog, the NLRB solicited briefs in Hawaii Tribune-Herald, 356 NLRB No. 63 (March 2, 2011).pdf to consider the circumstances under which a witness statement obtained by an employer during an investigation might have to be turned over to the union representative of the employees.  The NLRB's invitation to file briefs seems to be straightforward and states the questions to be considered as

"This case illustrates, however, that Board precedent does not clearly define the scope of the category 'witness statements.'  This case also illustrates that the Board's existing jurisprudence may require the parties as well as judges and the Board to perform two levels of analysis to determine whether there is a duty to provide a statement:  first asking whether the statement is a witness statement under Fleming and Anheuser Busch, and then if the statement is not so classified, asking if it nevertheless is attorney work product.  We have therefore decided to sever this allegation from the case and to solicit briefs on the issue it raises."

(Emphasis added).  These are questions about the scope of the underlying precedent, as in, what exactly is a "witness statement"?  Yet the Board, when it posted on its website hinted that it might be pursuing a much broader agenda.  The NLRB website poses the issue as  "1)whether the Board should coninue to adhere to the holding in Anheuser-Busch, Inc., 237 NLRB 982 (1978), that an an employer's duty to furnish information under Section 8(a)(5) of the Act does not encompass the duty to furnish witness statements and, if not, what standard should be applied to requests for such statements." 

 Anheuser-Busch, Inc., 237 NLRB 982 (1978).pdf, of course, is the 1978 NLRB decision holding that witness statements are confidential material.   The Board in that case, citing Supreme Court precedent held, unequivocally, that "requiring either party to a collective bargaining relationship to furnish witness statements to the other party would diminish rather than foster the integrity of the grievance and arbitration process."  Id. at 984. 

Counsel for the Hawaii Tribune-Herald immediately highlighted the major discrepancy between the NLRB website description of the issue and the invitation to file briefs in a March 21, 2011 Letter to NLRB.pdf  We will see if the NLRB clarifies the issues.  At a minimum, interested parties won't be sure what questions should even be addressed.  The website version of the issue would be a major change of NLRB precedent that could impact every employer that has union represented employees.