Labor Relations Update

Pair of NLRB ALJ Decisions Find Unions Violated NLRA

It is mid-November, and the Board is at a full complement, and even has a new General Counsel.  While we haven’t seen anything significant (or really, anything at all) come out of the newly constituted Board we know the new members are feverishly working on getting some decisions out.  The full complement of the Board will last only a few more weeks and then Chairman Miscimarra will depart leaving four members divided along party lines.

Meanwhile, the Board’s ALJ’s continue to hear cases and issue decisions.  This week we have a pair of ALJ decisions that show unions can and do sometimes get in trouble in with the NLRB.  Both are fairly basic factual situations and illustrate the kinds of choices employees have to make with regard to their union representation.

Union’s $20,000 Fine Against Member Of Sister Local An Illegal Attempt To Circumvent Collective Bargaining Agreement

In Operating Engineers, Local 150 (MacAllister Machinery Co., Inc.), ALJD, JD-89-17 (November 3, 2017), employees working at an employer that rented construction equipment were represented by union A at the employer’s Lansing and Niles, Michigan locations.  The employees represented by union A were subject to a collective bargaining agreement which contained a broad no-strike provision prohibiting a “strike, work stoppage,….sympathy strike, unfair labor practice strike. . .or any interference with operations.”

Union B sought to represent employer’s employees at its South Bend, Indiana location.  The organizing efforts failed and the employees in South Bend initiated an unfair labor practice strike against the employer at its Indiana sites.

Unions A and B are separate locals of the same union.

Union A employees encountered picket lines as they sought to make deliveries at the Indiana locations.  Among other activities engaged in by the strikers, they “followed the affected [union A] members on their Indiana assignments, tailgated them, requested their union cards, and chided them for not ‘clearing in’ [seeking authorization]” from union B. Although the Charging Party (a union A employee) sought clearance to cross the picket line he was repeatedly denied.

Union B fined each union A member who crossed the line $20,000.  As one might expect, the fine caused the union A members to ask the employer to not send them to Indiana.  This request was granted and the union A employees had their workload reduced resulting in a loss of pay and benefits.

Union A an B entered into an agreement to rescind the fines and resolve the charges, although this must have been cold comfort to the union members who had been fined because the agreement “indicated that future breaches would trigger additional charges and fines.”

Charging Party, a union A represented employee, filed charges against union B, alleging that the fines and other activity was unlawful coercion of an employee in violation of Section 8(b)(1)(A) (which is the union counterpart to Section 8(a)(1)).

The ALJ did not hesitate to find a violation:

Under §8(b)(1)(A), a union cannot restrain or coerce employees in the exercise of their §7 rights.  Although §8(b)(1)(A) does not impair the right of unions to set and enforce valid membership rules, these rights do not permit unions to penalize members, who comply with their  labor contract’s no-strike provisions. Mine Workers Local 1249 (National Grinding), 176 NLRB 628, 632 (1969).  The Board has, accordingly, found that allowing unions to penalize members, who refused to violate no-strike provisions, encourages unions to abort their contractual pledges and creates labor instability; such action is, therefore, invalid.  Teamsters Local 688 (Frito-Lay, Inc.), 345 NLRB 1150 (2005).

The ALJ found this violation occurred because although the discipline was issued by union B, and union A “played no part,” the fines “amounted to an end-run” around the clear work stoppage language in union A’s agreement.

The remedy ordered by the ALJ required, among other things, that union B make the employees whole for the reduction in hours they suffered as a result of the coercion.

The case is of interest because of the principles set forth that two unions can’t collude to get around a collective bargaining agreement provision.  What is unknown is whether any charges were filed against union A (which if not complicit certainly seemed to tacitly approve of union B’s tactics by entering into a settlement agreement that kept the threat of fines in place).

The case does show the value of having a broad no-strike provision in an agreement as it makes clear the expectation of the workforce in relation to unrelated labor disputes.

Union Steward’s Text Shows Discrimination Against Non-Member

In Machinists Lodge 61 (Cummins, Inc.), ALJD, JD-91-17 (November 8, 2017), the employer manufactures diesel engines at a plant in Memphis, Tennessee where the union represents the workforce.  In the incident leading up to the NLRB charge, three maintenance mechanics were summoned to fix a power press at the facility and one mechanic broke his thumb when the press moved during the process.  All three mechanics were fired for allegedly violating the company’s lockout/tagout policy.  Charging Party, one of the mechanics who had worked for the employer for almost 18 years, sought out the shop steward and filed a grievance.  The union represented the Charging Party and other two employees in the grievance process.  The employer informed the union that the Charging Party’s grievance was denied.  The union steward immediately informed the Charging Party via text message that his grievance had been denied.  The Charging Party responded by asking what the next steps were in the process.  The union steward replied, again by text, that since Charging Party was not a union member, the union would not arbitrate his case.

Tennessee is a right to work state and so there was no obligation  by Charging Party to join the union or pay dues.  Charging Party filed a charge alleging a violation of Section 8(b)(1)(A) for the union’s failure to represent him.  The ALJ, like his counterpart above, found a violation quickly:

Existing Board law is that a union violates Section 8(b)(1)(A) in refusing and failing to arbitrate a bargaining unit member’s grievance because the unit member is not a member of the Union.  Port Drum Company, 170 NLRB 555 (1968).  I am bound by Board law even, where as here the record establishes that the fees and expenses incurred by the arbitrator shall be borne equally by the parties and the Union must assume all expenses associated with the preparation and presentation of its defense. . . Thus, the Union in this case is obligated to incur significant expenses on behalf of unit members who have not contributed a cent to the operation of the Union.

The ALJ rejected the union’s defense that the steward played no role in the decision (probably because the steward was the one communicating with the Charging Party).  The ALJ also rejected the notion that the union had determined the grievance was non-meritorious because “there is no documentary evidence” to support the contention.  Also, because the ALJ seemed to find, based on the Charging Party’s testimony, that the grievance did indeed have merit.

There is no duty for a union to take a case to arbitration.  Unions oftentimes evaluate a case and decide there is no merit.  In this case, the steward’s communication of the reason why the union did not want to go forward made the assertion there was “no merit” to the case harder to believe.

This was an easy case because the law is clear.  And, of course, it is yet another stark reminder that things we say electronically usually can be saved and come back to haunt us later on.

NLRB Gains a New General Counsel With Senate Confirmation of Peter B. Robb

By a vote of 49 to 46, the U.S. Senate confirmed Peter B. Robb as the General Counsel of the NLRB.  Mr. Robb, who replaces former General Counsel Richard Griffin, is the 33rd person to hold the position since the NLRA was passed in 1935.  We have previously discussed how the newly constituted Board is likely to change much of the major case law decided in the last several years, but the General Counsel also wields great influence in the administration of the NLRA.  For starters, the General Counsel has “prosecutorial discretion” to decide which cases to advance, or not.  For example, we recently pointed out how the Board was divided over the proof needed to establish a threshold case of a violation of Act with the more pro-management Chairman arguing the standard is more exacting in that there should be a connection between the protected activity and the adverse action.  The General Counsel can decide not to issue complaint if he believes this standard of proof has not been met.

Actions we could see from the new General Counsel:

  • The types of cases submitted to the Division of Advice will be a good indication of the agenda of the new General Counsel will pursue.  By directing that certain types of cases filed with a Region be submitted to Advice, the  the General Counsel usually is seeking guidance on a potential change to the law.  The most recent such directive of mandatory submissions to Advice is here:  GC Memo – Mandatory Submissions to the Division of Advice (March 22, 2016).
  • More careful investigation of charges.  In the last few years, the tendency of the Regions has been to share little factual information about an allegation contained in a charge, and asking the the Charged Party to submit a response.  Indeed, the letters sent to Respondents soliciting a position simply restate the charge allegation with no other information.   Not providing details of what someone claims you did wrong that allegedly violates the law obviously makes it difficult (some would argue impossible) to defend.  It may have even resulted in some charged parties not participating in an investigation at all.   The General Counsel could go back to a more thorough investigation where evidence is solicited from the Charging Party and many of the  details are shared with the Charged Party.
  • Use of injunctive relief.  With the change in administration comes a change in priorities.  The cases the outgoing General Counsel thought warranted Section 10(j) relief (such as in “nip in the bud” organizing cases) may not get the same attention.

The Devil Is In the Details: New Board Members Likely To Change Law In Nuanced Ways

The end of September in most years sees a spate of new NLRB decisions, sometimes dozens, issued on or about September 30, to coincide with the end of the agency’s fiscal year.  Not so this past September 30 because of the recent changeover from a majority of Democrat Board Members to a majority of Republican Members.  The buzz for the ten months since the change in Presidential administration has been how the NLRB might reverse or otherwise change many of the decisions handed down in the last several years, including the micro-unit case, the case mandating the production of witness statements, the right to use company email for union activity, as well as how the agency evaluates the lawfulness of employer policies.  To name just a few.   Other than reversing case law, the Board can influence the law in more nuanced ways.  These changes to the way cases are analyzed may be as important, if not more important, than some of the much discussed cases of the last few years.  The Board’s influence in this regard is not so apparent but definitely worth keeping an eye on.  In a recent case, the Board gave us clues about how two of the most common issues to come before the agency, –the evaluation of discriminatory motive in disciplinary cases and the evaluation of employer statements as “coercive”–, could be addressed differently in the coming years.

In Novato Healthcare Center, 365 NLRB No. 137 (September 29, 2017), a decision issued on the last business day of the fiscal year, the Board decided a fairly routine case involving unfair labor practices stemming from an organizing drive.  The Board upheld an Administrative Law Judge’s finding that the employer violated Section 8(a)(3) by suspending and terminating employees for their union activity.  The Board also upheld the ALJ’s finding that the employer had violated Section 8(a)(1) of the Act by interrogating a known union adherent.  These issues are, of course, the very bread and butter of the agency’s cases and the three Board members (Chairman Miscimarra, Pearce and McFerran) essentially agreed on most issues.  However, in footnotes, the Board members argued over the proper analysis to apply to these issues and those glancing comments spell a huge difference of opinion.

Employer Motivation In Discrimination Cases – How Much Of A Connection Must There Be To The Employee’s Protected Activity?

Under Section 8(a)(3) of the NLRA, an employer may not discriminate with regard to hire, tenure, or any term or condition of employment in order to encourage or discourage union membership.  Most of the cases under this provision involve adverse action (i.e., discipline, suspension, discharge, etc.) of an employee who engages in union activity.  The well established test for establishing a threshold case of the unlawfulness of the adverse action was set forth in Wright Line, 251 NLRB 1083 (1980), enf’d 662 F.2d 899 (1st Cir. 1981), cert. denied, 455 U.S. 955 (1982).  Under Wright Line, the General Counsel must establish that a substantial or motivating factor in the employer’s action against the employee was the employee’s protected or union activity.  These elements are often expressed as:

  1. The employee engaged in protected activity;
  2. Such activities were protected by the Act;
  3. The employer had knowledge of the union activity; and
  4. The adverse action taken against the employee was “motivated” by these activities.

The meaning of “motivated” is, of course, of crucial importance.  Yes, there are cases where motivation is readily apparent, like when an employer basically states the reason for the discipline or other action is the union activity, but such cases are rare.  Most of the time the employer’s motive must be discerned by an evaluation of circumstantial evidence.  Here, too, the general elements from which an inference of unlawful motivation are fairly well established: (a) timing (i.e., the elapsed time between protected activity and adverse action),-the shorter the time the greater likelihood the action was motivated by the protected activity; and issues related to employer’s actions, such as (b) delay of discipline (suggesting it was wasn’t taken in the normal course of business), (c) departure from established discipline procedures (always a red flag), (d) disparate treatment (always subject to dispute), (e) inappropriate or excessive penalty or (f) shifting reasons for the discipline.  All of these latter events are unusual and from which one can infer the employer probably would not have taken the action absent the protected activity.

In this case, during a hard fought organizing campaign, the employer discovered four employees were asleep and terminated them.  The ALJ noted the timing of the discipline in relation to the organizing was close (2 months) and noted that the investigation conducted by the employer was lacking (it didn’t interview another supervisor who allegedly was present) and that there was evidence of disparate treatment in that no employee had been discharged for the same offense.

The three Board members agreed the General Counsel met its burden in establishing a threshold case.  What they disagreed about is the standard for evaluating motivation.  The majority stated that, “[t]he General Counsel is not required to ‘demonstrate some additional ‘nexus’ between the employee’s protected activity and the adverse action.'” Libertyville Toyota, 360 NLRB 1298, 1301, n. 10 (2014)(enforcement history omitted).

Chairman Miscimarra disagreed, stating he “believes [the General Counsel] must establish a link or nexus between the employee’s protected activity and the employer’s challenged adverse employment action.”  The Chairman noted that applying this standard the General Counsel met his burden of establishing a threshold case.

So what does all this mean?  It’s hard to say exactly because neither side evaluates the evidence under their stated framework.  What is clear, however, is the remarks of the majority and the dissent evidence a potentially large gulf in interpretation of the proof the General Counsel must establish to make a threshold showing that the Act has been violated.  One could see any one of the elements used to infer unlawful motivation being interpreted differently under the Chairman’s standard of requiring a “nexus.”  For example, whether there exists “disparate treatment” is so fact intensive that one could see the Board deciding that the employer did what it often does:  evaluates the particular facts in deciding the discipline.  Or, that the two months between union activity and the discharge is not enough to establish a “nexus” under the Chairman’s view of the world.

The recent change in majority make-up of the Board,  could mean that the Board will apply a more exacting scrutiny to the the proof used by the General Counsel to establish a a violation of the Act.  As most cases rely on a review of circumstantial evidence presented the difference between a “nexus” and not may be significant.

Not Every Question Asked During Organizing May Be Considered Coercive

The ALJ also found that the employer violated Section 8(a)(1) of the Act when, approximately one week before the union election, the employer’s Director of Staff Development asked a known union supporter (one who was wearing a union lanyard and who openly spoke about support for the union) whether the employee was going to vote for the union in the election.  The employee candidly replied that he was going to vote for the union.  The employer then pointed out that having the union may cost the employee in dues; the employee replied that he was aware of the cost.

The ALJ found the question to constitute unlawful interrogation. The Board majority affirmed.  The Board held that it has “long held” questions about how an employee intends to vote as “hav[ing] a uniquely coercive tendency.”  Further, the Board held that the employer’s discussion “clearly” communicated the “preference” that the employee vote against representation.

Chairman Miscimarra saw the exchange differently.  The Chairman would have found no violation of the Act noting that the exchange between an employer and union adherent “has long been recognized” by the Board as not coercive.  The Chairman noted that the standard for evaluating the coercion of a statement or question set forth in Rossmore House, 269 NLRB 1176 (1984) requires the Board is to consider the totality of the circumstances.  The Chairman pointed out that the employee had worn “pro union regalia for weeks” and the employee immediately and truthfully responded to the question as to how he planned to vote.  Although unstated by the Chairman, it seems doubtful that the employer’s “preference” could, or should, add to the coerciveness of a particular statement if such preference is not stated in an unlawful manner.  Under these circumstances, the Chairman would find the question was not coercive.

Here again we see a significant difference of opinion in how to interpret a very common standard of the law.  The majority sees an objective question designed to elicit an employee’s sympathies and looks no further.  The fact the question was asked makes it unlawful.  The dissenting Chairman takes a more narrow approach arguing that under the circumstances the question couldn’t possibly be “coercive” because the employee was an open union supporter who reaffirmed his sympathy for the union in his response to the question.

Takeaways

This case in most respects is very routine.  The difference of opinion between the majority and the dissent on two of these routine matters, however, is a good indication that it may soon in become harder to prove discrimination and the coerciveness of some statements.  We have seen this kind of debate play out recently when a Board majority found an employer’s asking an employee how things were going to be the prelude to coercive solicitation of grievances. Employers have been raising the “totality of circumstances” defense for many years, of course, asserting that the agency oftentimes will equate the mere presence of protected or union activity as enough to infer unlawful motivation when any adverse action is taken.  Also, employers have been raising the fact that many times a statement (or in this case a question) is objectively not coercive based on the circumstances.  Still, going forward it would not hurt to emphasize these points in defense of an alleged violation of the Act.

Senate Confirms Appointment of William J. Emanuel to NLRB; Board Has Full Complement,- For Now

In a 49-47 vote today, the Senate confirmed William J. Emanuel’s appointment to the NLRB.  Once Mr. Emanuel is sworn in, it will be first time since 2015 that the NLRB has had a full five members.  Before 2015, years of gridlock often saw the Board at less than full strength, which resulted in all sorts of mayhem, including the two Member Board debacle.

Because the terms of NLRB members are staggered, whether the Board is able to operate at full strength is dependent on whether a nominee can make it through the confirmation process. With the addition of Member Emanuel there have been 8o Board members since the Board was established in 1935 (counting recess appointments).  Here are some statistics to throw around at a dinner party (since the NLRB is often a hot topic and you want to be in the know):  42 members (52.5%) have been Republican, 37 members (46.24%) have been Democrat, and 1 (1.25%)(Don Zimmerman- it seems like we should give him special mention) was an Independent.

The current terms of the existing NLRB members are as follows:

  • Philip Miscimarra, Chairman – Term expires December 16, 2017
  • Mark Pearce, Member – Term expires December 16, 2018
  • Lauren McFerran, Member – Term expires December 15, 2019
  • Marvin Kaplan, member -Term expires August 27, 2020
  • William Emanuel, Member – Term expires August 27, 2021

General Counsel Richard Griffin’s term expires November 4, 2018.  A General Counsel’s term is four years from the date of commission.  Here is a full listing of those who have held the position of General Counsel.

Of course, with the Board at full complement it can now decide cases that reverse existing precedent.  The Board may only be at full complement for the next several weeks as Chairman Miscimarra has indicated he intends to depart at the expiration of his term in December.

NLRB Ditches Effort To Expand Weingarten Rights to Non-Union Workplaces

Since the change in Presidential administrations, the main topic has turned to what rules will a newly constituted NLRB change?  With the addition of Marvin E. Kaplan the Board now has four members, which makes undoing some of the past few years a difficult task.  But a four member Board also means there likely will be no further expansion of the law.  Four members, split evenly between two different political parties and differing viewpoints means little may occur before the fifth member is confirmed sometime this Fall.

One can see evidence that this pendulum is in the process of swinging back in a recent Advice Memorandum released on September 7, 2017.

In General Electric, Cases 6-CA-176001 et al., Adv. Mem. dated December 1, 2016, Advice directed a Region to issue a complete on two cases “as vehicles to urge the Board to extend Weingarten rights to unrepresented employees and find that the Employer violated Section 8(a)(1)” by forcing an employee to submit to an investigatory interview without the assistance of a coworker and by “forcing another employee to submit to an investigatory interview in the presence of an anti-Union employee witness unilaterally designated by the Employer.”  At first blush, this sounds like it could represent a big change.  Weingarten rights currently apply only to unionized employees, and so these “vehicles” could theoretically drive the Board to apply the rights to the 93% (give or take) of the private sector that is not unionized.  You can hear Human Resources managers already saying, “you mean we might have to let any employee have a representative any time we want to have a discussion that might lead to discipline?  The logistics of that are too difficult to imagine.”

Except this Advice Memorandum represents no such thing for the simple reason that the Board is not in the habit of sharing its litigation strategy.  The Division of Advice is the internal think tank of the NLRB.  Its lawyers ponder closely the nuances of the Act, the legislative history of the law, and the Board’s vast body of cases to assist the General Counsel with situations not addressed by current law.  Advice also provides support for complex situations.  Also, as we can see by this Memorandum, the Division also helps the General Counsel look for ways to change the law in a manner consistent with the direction the General Counsel would like to see the Board take. The product of Advice is a so-called Advice Memorandum, which is essentially a document setting forth the reasons why complaint should issue, or not.  When an Advice Memorandum is released to the public the case is most certainly over because the government is not in the habit of sharing its litigation strategy prior to trial.  We have previously discussed the release of Advice Memoranda when the Board wants to let the world know how it addressed certain situations, like when it dismissed a case involving the discharge of an employee over a social media posting.

In these cases, a review of the Board’s docket shows that while trial was scheduled for earlier this year, the cases ultimately were closed based on “withdrawal” which most certainly means the objective of the Memorandum to expand Weingarten rights was deemed no longer viable given the change in the make-up of the Board.

It is an interesting read, however for three reasons.  First, the Advice Memorandum sets forth the history of how Weingarten rights have shifted from unionized to both union and non-union and back.  Second, it contains a good collection of NLRB Weingarten cases.  Third, while the Memorandum explains the reason why these particular charges were worth taking a shot at expanding the law again.  In the case the union “has never been certified or recognized” as the exclusive bargaining representative.  Instead, the union has

functioned at the plant as a pre-majority labor organization since it was formed by a committee of workers in the fall of 2012.  The Union has a constitution and was chartered by the National UE in August 2012.  Its stated mission includes addressing issues that impact the interests of the entire workforce such as fair and consistent treatment workers by the Employer, equal pay for equal work, and protecting worker benefits.  The Union has elected officers, including a network of trained stewards.  Union members pay dues, and the Union holds regular membership meetings and engages in organizing drives and leafleting.  The Union advises its members regarding avenues that the Employer has in place to address complaints and disciplinary issues.

While the employer does not recognize the union it has granted limited access of the union to its facility for purposes of meeting with employees.  The union also has some ability to post literature.

Advice’s analysis does not contain any earth shattering revelation, like “we discovered a heretofore unseen footnote in the Weingarten decision that says it should be applied to non-union workforces.”  Rather, Advice focuses on the policy considerations behind Weingarten and notes there are “unique factors” present in the set of facts that make a change in the law more “compelling.”  Those unique factors include, of course, the presence of a minority union with a “network of trained stewards who are subject to the [Union’s] constitution and bylaws requiring fair representation of their coworkers.”

Why publish this memorandum now?  One can never know for sure.  However, it is possible the outgoing General Counsel wanted to signal to the public that while there may be a change in direction of the Board, there are ways to keep up the fight:  a minority union being one of them.  Not as interesting as analyzing whether an employer’s search of an employee’s car constitutes an investigatory interview, but pretty revealing nonetheless.

NLRB: Employer’s Side Letter Explaining NLRB Notice Breached Settlement Agreement and Warranted Default Judgment

One of the fundamental pillars of any remedy doled out by the NLRB is the agency’s  requirement that the employer (or union) post a “Notice to Employees,” a bright blue poster detailing the misdeeds of the charged party.  Such a Notice is required to be posted as a result of a finding of an unfair labor practice after trial; the Notice posting is also required through any Board settlement agreement.  The content of the Notice always first sets forth employee rights (including the right to refrain from protected activity).  After the employee rights comes the paragraphs explaining what the posting entity WILL or WILL NOT do, and explains any required affirmative actions such as the removal discipline or rescinding an unlawful rule.  The Notice itself says that it may not be defaced or altered in any way.

It is common in all sorts of litigation for a company to communicate about settlement of a dispute:  that it entered into a settlement “for the good of the business,”and often asserting that it  did “nothing wrong” and that there had been “no finding” of wrongdoing.  In other words, the company puts its spin on what happened so that it can (try) to control the narrative.

But what if an employer wants to put its spin communication right next to the NLRB’s Notice to Employees?  Board case law has long held that such side postings are improper if the communication “detracts” from the agency’s Notice.  If the employer is in noncompliance there most certainly will be some further litigation.  Does such an employer posting also constitute a breach of an NLRB settlement agreement? If so, does such a breach warrant the entry of a default judgment pursuant to the default provisions of the agreement?

In Outokumpo Stainless USA LLC, 365 NLRB No. 127 (September 7, 2017) the Board answered both questions in the affirmative.  All three members of the Board found that an employer’s side letter posted next to the agency’s Notice to Employees, constituted breach of an informal Board settlement agreement.  A two member Board majority also determined that such breach warranted a default judgment under the agency’s much debated default language.

Background

A union filed a petition seeking to represent a group of employees.  The campaign was hard fought.  Six days before the election the union filed unfair labor practice charges, which according to Board policy resulted in the election being blocked until the charges could be investigated and resolved.  There were many separate alleged violations of the Act including surveillance, impression of surveillance, threats, unlawful rules and the discipline of employees pursuant to overbroad rules.

The Parties Enter into an Informal Settlement Agreement

In order to resolve the charges short of litigation the parties agreed to a Board settlement agreement to remedy most of the allegations.  The employer agreed to rescind the discipline and the overbroad rules, and of course, the employer agreed to post a Notice to Employees at its facility and on its intranet.

The settlement agreement contained the (now standard) default language describing the consequences of noncompliance.  That default language, among other things, stated that “in the case of non-compliance with any of the terms of this Settlement Agreement by the Charged Party, and after 14 days notice from the Regional Director of the National Labor Relations Board of such non-compliance without remedy by the Charged Party, the Regional Director will issue a complaint that will include the allegations [that are subject of the agreement].”  The default language further provided that in the event of noncompliance the breaching party waived its right to file an answer and all allegations will be deemed admitted.  The Board then, “without necessity of trial or any other proceeding,” would find all allegations to be true and would provide an order and remedy for same.

The Employer Posts its Own Communication about the Charges Before Posting the Notice to Employees

The employer rescinded the rules and discipline.  The employer also posted the Notice to Employees on its intranet and on its bulletin board.  Before doing so, however, the employer emailed its employees and posted on its bulletin board a lengthy letter in response to the unfair labor practice allegations.  This letter stated the union filed the charges “just prior” to the election in order to prevent an election.  The letter blamed the union for preventing the employees from voting.  The letter stated the employer did nothing wrong and that the Board had not found that it violated any laws.  The letter stated the Board’s notice essentially was the complete remedy and that the employer was not required to pay any “fines, penalties, or monetary requirements.”

Region Tells Employer to Remove Letter, Employer Refuses

The Region notified the employer that its letter constituted noncompliance with the settlement agreement and instructed the employer to remove the letter and post the Notice to Employees for an additional 60 days.  The employer refused and the Region offered to “hold off” on the employer’s communication if the employer agreed to post the Board’s Notice for an additional 60 days.  Again, the employer refused.  The Region then notified the employer that its side letter constituted a breach of the settlement and issued a complaint alleging the employer violated Section 8(a)(1) of the Act in all the ways set forth in the original settlement agreement.

The employer filed an answer. The matter was submitted to an Administrative Law Judge who concluded that the employer’s letter breached the settlement agreement and that a default judgment was appropriate.  The employer appealed.

Board Holds Letter Constitutes a Breach of Settlement Agreement and Warrants A Default Judgment

The Board first addressed the issue of whether the employer’s letter constituted noncompliance with the agreement.  The Board held:

[Noncompliance occurs] where the communication attempts to ‘minimize the effect of the Board’s notice’ and ‘suggests to employees that the Board’s notice is being posted as a mere formality and that Respondent’s true sentiments are to be found in its own notice, not the Board’s.’  Bangor Plastics Inc., 156 NLRB 1165, 1167 (1966), enf. denied 392 F.2d 772 (6th Cir. 1967).  As discussed in more detail in the judge’s decision, the [employer’s] letter was strikingly similar to the letter distributed to employees in Gould, Inc., 260 NLRB 54 (1982).  In Gould as here, the letter stressed that the respondent had not been found guilty of any violation of the law.  260 NLRB at 57.  In Gould as here, the respondent falsely suggested that the posting of a notice was the only action it was required to undertake pursuant to the settlement agreement. Id.  In Gould, as here, the respondent additionally sought to minimize the effect of the notice by distributing its ‘spin’ on the notice before the notice itself was posted. Id. at 56-57; . . . Finally, in Gould as here, respondent used the letter to blame the union for election delays.

A two member Board majority (Pearce and McFerran) next found that the employer’s noncompliance warranted a default judgment.  The Board noted the employer’s letter violated the settlement agreement in “two ways.”  First, the mere posting of such a letter detracted from the Notice and has long been held to constitute noncompliance.  Second,  “insofar as the settlement specifically required the Respondent to post the parties’ agreed-upon notice, that provision must be construed (particularly in light of Board law) as requiring the posting of that notice and nothing that detracts from that notice.”  The Board noted that the employer’s side letter was not an “element” of the parties’ settlement but was a “unilateral act that tended to frustrate performance of their settlement agreement.” The Board majority addressed due process concerns raised by the dissent noting that, “[i]n agreeing to [the default] provision, the Respondent accepted the possibility that the Board would find noncompliance sufficient to trigger the default provisions.”

The Board majority proceeded to strike the employer’s answer to the complaint except where it had to do with noncompliance, which according to the default language was the only issue that could be contested.  By issuing a default judgment the Board found that the employer had committed multiple unfair labor practices as alleged in the complaint.  The Board then amended the remedy to specifically include language prohibiting the posting of any “letters or notices to employees that modify, alter, or undermine the effectiveness of the official notices.”

Dissent Finds Fault in Default

Chairman Miscimarra agreed that the employer’s action breached the settlement agreement which the Regional Director could then withdraw.  The Chairman, however, took issue with whether the Board can or should issue a default judgment.  Miscimarra noted that prior to the Board majority’s decision “the Board has never held that a side letter warrants entry of a default judgment, which precludes the [employer] from raising any defenses against the Union’s unfair labor practice allegations.”  The Chairman raised a number of reasons as to why default should not issue.  These included constitutional due process concerns about finding an unfair labor practice without allowing the employer to defend itself..  The Chairman also raised the fact that it was not at all clear to him that the default language clearly and unmistakably waived the employer’s right to raise a defense especially considering the Board majority wrote into the agreement a duty to not post a side notice.  Finally, as the Chairman explained what he viewed as a “profound” problem with the Board majority’s ruling:

it prevents the Board itself from deciding the merits of the unfair labor practice allegations.  At this time, the Board does not have a record upon which it may decide the allegations on their merits.  The Charging Party alleged that the Respondent committed various unfair labor practices.  The Respondent’s side notice alleged that the Charging Party’s true purpose in filing the charges was not to seek redress  but to ‘block’ the election.  By entering default judgment rather than proceeding to a hearing, my colleagues preclude a determination of whether the Charging Party’s allegations have merit.

Takeaways

This case illustrates a few important points about NLRB practice and procedure.  First, although the Board majority noted that the employer “agreed” to the default language, the fact is that the General Counsel rarely allows alteration to the boilerplate language in its settlement agreement.  So, a party that wants to resolve an unfair labor practice charge in the vast majority of cases must sign a an agreement containing the default language.  This often will be the only way to settle the matter.  There rarely is much (or any) true negotiation over the point.  Unless and until the Board changes its position on the default language, the employer should carefully consider whether compliance involves elements that could be subject to dispute because such disputes could result in a default.  While many Board agents claim that the default language has “never” or “rarely” been invoked, one can see from this case that the General Counsel will not hesitate to invoke the default language to deprive the employer of an opportunity to raise defenses.  In  cases where compliance could be contested it may be better to litigate.

Second, if the employer believes the best course of action is to enter into the settlement agreement containing default language it has to be careful in its dealings with the agency in the event there are issues with compliance.  From the Board’s recitation it certainly sounds as though the Region was trying hard to avoid default in this case and its efforts were rebuffed. While the employer stated it wanted to get to an election its actions actually were preventing it because there was no way the Board was going to hold an election while remedial issues were pending.  Regardless of whether the charges are blocking an election, now employers must worry that any notice of noncompliance could result in a default judgment.

Finally, as Chairman Miscimarra noted, the employer merely was stating its view that the union had deliberately blocked the election.  As anyone who has experienced the NLRB election process knows, the union has almost complete unilateral power to block an election if it doesn’t believe the vote is going to go its way.  Sometimes the charges have merit and sometimes they do not.  Employers have to be very careful in shifting the blame for an action (even if it may be true) to the union especially if the Board is involved through the filing of unfair labor practice charges.

NLRB’s Enforcement of Secondary Boycott Restrictions Does Not Place Union Agent in Involuntary Servitude Nor Does It Encroach on Union’s Religious Freedom

Labor Day is upon us.  It is fitting, therefore, to enter the weekend with another case that exemplifies the bizarre world of labor relations.  Like the case of the human resource manager who turned on his employer, or the nurse who felt her union activity protected her in screaming confrontations, we continue to see new odd and amusing situations.  This one involving Picket Line Etiquette.

In Int’l Assn of Bridge, Structural, Ornamental and Reinforcing Iron Workers Local 229, 365 NLRB No. 126 (August 30, 2017) the Board was confronted with a fairly simple situation, an allegation that a union was attempting to coerce a neutral employer in connection with a labor dispute.  Not many of these secondary boycott cases get tried because if a union does it enough it can be faced with ever increasing NLRB oversight and sometimes even monetary damages.  Here, the dispute centered over the construction of a parking garage. The charging party (“Neutral”) furnished and installed the reinforcing steel.  Neutral was signatory with the union.  The union had a dispute with another contractor (“Primary”) performing concrete work at the site.

The union began picketing the site in its dispute with Primary, the signs lawfully stated that Primary was “Not Paying Area Standard Wages.”  The picketing did not have the desired impact and so the union’s business agent sent a series of texts to Neutral’s employees who were members of the union.  One text had a symbol of a picket sign which stated “Friends Don’t Let Friends Cross Picket Lines.”  The text also contained a link to a union webpage document entitled “Picket Line Etiquette” which stated

Labor’s first commandment:
“THOU SHALL NOT CROSS THE LINE”
A good Union member is EXTREMELY CAREFUL when confronted with a picket line situation
When a picket line is established on a job where you are working:
You MAY LEAVE.  You DO NOT TALK.
You READ the PICKET SIGN as you leave
You DO NOT hang around near the job
You know that ONCE A PICKET LINE IS ESTABLISHED, your Business Agents and other Union Officials
are legally gagged and handcuffed from giving advice pertaining to THAT JOB.  they can only tell you if the
Picket Line is AUTHORIZED.
A good union member knows their rights:
You have the right not to work behind ANY Picket Line
You have the right to decide for yourself whether to walk off a job being picketed.
You understand that YOUR TRADE may be UNDER ATTACK next and you would want everyone’s support.

BE PREPARED AHEAD OF TIME HOW TO REACT TO PICKET LINES

Under the Section 8(b)(4)(i)(B) of the Act a violation occurs by picketing or activity that induces or encourages the employees of a secondary employer to cease doing business with the primary employer.  The Board has held that in evaluating whether inducement or encouragement occurs the statements made by union agents directly to Neutral employees if such statements would reasonably understood by the employees to be a “signal” or “request” to stop working.

There was very little question the text messages and the Picket Line Etiquette document was inducement or encouragement to engage in a work stoppage.  Indeed, the union stipulated to that fact.  So, why contest the case?  Because the union claimed the Act could not be enforced for three reasons.

First, under First Amendment law the Act’s prohibition of appeals to employees is too broad.  The ALJ noted that these “arguments, although eloquently presented, are rejected…it must be found that the [Supreme] Court” in 1951 found that outlawing secondary pressure does not violate the First Amendment.  The union also asserted that Section 8(c) of the Act protects the union agent’s requests because there was no promise of benefit or threat of reprisal.  The ALJ summarily rejected this argument.

Second, the union claimed that the secondary boycott provisions of the Act violated the Thirteenth Amendment of the United States Constitution.  That amendment abolished slavery and involuntary servitude in 1865. The ALJ found, “[o]n this record, however, no evidence of involuntary servitude warranting application of the Thirteenth Amendment exists.”  It is interesting to wonder whether such a record could exist when evaluating statements.

Third, as if the previous defenses were not a reach, the union shot for the moon and claimed its communications were protected by the Religious Freedom Restoration Act, which provides that the government may not “substantially burden” the free exercise of religion. The RFPA does not require the exercise of any particular religion only that the claimant engage in “any exercise of religion.”   The union claimed its efforts to protect work for its members was a sincerely held belief that could not be abridged.  The ALJ gave short shrift to this argument as well, noting that the union had failed to show the Act posed a “substantial burden.”

The Board adopted the ALJ’s finding of a violation without comment.

Of course, employers constantly make the free speech arguments, especially when defending against he NLRB’s handbook allegations and other efforts by the Board to regulate what is said in the workplace.  So,in that respect the union’s arguments were not that far off the mark.  This may be the first time that any party, employer or union, has made an involuntary servitude argument against the NLRB.  The same goes for the alleged encroachment on religious freedom. Those arguments are one (two, actually) for the books.  It is good to see that “Picket Line Etiquette” exists. In the immortal words of Emily Post, “Nothing is less important than which fork you use.  Etiquette is the science of living.  It embraces everything.  It is ethics.  It is honor.”

 

NLRB’s Attempt To Incrementally Expand Weingarten Rights Rebuffed By Federal Appeals Court

The NLRB suffered a setback this week when its interpretation of Weingarten rights was rebuffed by the D.C. Court of Appeals.  This is the same court that recently declared the agency was acting more as an “advocate than adjudicator” in a case involving access to an employer’s premises.

Weingarten, which derives its name from the United States Supreme Court’s decision in NLRB v. J. Weingarten, Inc., 420 U.S. 251 (1975), is one of those fundamental knowledge areas about which all practitioners in labor relations must understand.  Weingarten applies only to union represented employees and the “right” is that the employee must be allowed to bring union representation to an employer interview if he/she reasonably believes the interview might result in discipline.  Simple?  Yes, in theory.  In practice, however, the application of Weingarten sometimes has proved difficult as union representatives urge the widest possible application while employers seek to narrow its interpretation.  This difference of perception, if not interpretation, has led to a number of litigated disputes.  For instance, can the union assert representation on behalf of the employee or must the employee assert it? Does the employee get to pick the particular union representative?  What if the chosen union representative is unavailable during times the employer wants to conduct the interview?  What is the role of the union representative?  Are they suppose to be an advocate or merely a witness?  Does a Weingarten violation overturn any discipline that is issued?  One union even argued that a search of an employee’s vehicle constituted an “interview” which triggered Weingarten.  These issues, and others, have vexed employers (and labor representatives) for decades and there is a great deal of Board law interpreting Weingarten in myriad situations.

Sometimes even the Board’s interpretation is not correct.

Midwest Division-MMC, LLC v. NLRB, No. 15-1312 (D.C. Cir. August 18, 2017) involved a Kansas hospital where the nurses were represented by a union.  Under Kansas state law, hospitals must establish an internal peer-review program to monitor the level of care given by professionals to patients.  The purpose of the committee is to inquire into alleged violations of the standard of care by the hospital’s nurses.  Serious breaches of the standard of care are reported to the state licensing agency.  If the state licensing agency –called the Nursing Board– finds that the nurse has violated the standard of care in a serious manner (i.e., one that might result in a “reasonable probability of causing injury to a patient”), the Nursing Board can strip the nurse of his/her license.

Background Facts

The hospital employer’s peer review committee sent letters to two nurses alleging that they had “exhibited unprofessional conduct as defined by the Kansas Nurse Practice Act.” The letters stated that the nurses’ “conduct preliminarily has been determined to be a Standard of Care Level 4:  grounds for disciplinary action.”  The letters stated each nurse would have “an opportunity to address the Peer Review Committtee regarding any potential reportable incident prior to any final determination of a Standard of Care by the Committee.”  The letters stated that the meeting would occur only “if you choose.”  The nurses were also given an opportunity to submit a written response in lieu of an appearance.

Both nurses asked to have union representation accompany them to the hearings. One nurse asked before the interview began; the other asked after the interview had started. These requests were denied.  The hearings proceeded with both nurses electing to participate.  After the hearing, the Committee found the nurses’ conduct was a violation of the standard of care but of a lower level than alleged and therefore the finding would not be reported to the Nursing Board.

The union filed charges over the refusal to allow union representatives to accompany the nurses.  (The union also alleged a failure on the part of the hospital to supply information requested by the union related to the investigation, as well as an allegation that an employer policy concerning confidentiality was overbroad but those are less interesting.)

Both ALJ and Board Find Violation In Denial Of Representation

The Administrative Law Judge and then the Board found the employer violated the law with respect to all three allegations.  As to the Weingarten allegation, the Board concluded that the nurses’ Weingarten right had been infringed because the denial occurred at the time of hearing, which the Board concluded gave rise to an obligation by the employer, “at that point to give the employees the opportunity to cease their participation in the meetings.” The employer appealed.

Court Disagrees with NLRB, Refuses Enforcement on the Weingarten issue

In analyzing the Weingarten issue, the appeals court turned to the Supreme Court’s decision and quoted the language as to the circumstances surrounding the right to union representation:

Weingarten affirmed the Board’s conclusion that it would be a ‘serious violation of the employee’s individual right to engage in concerted activity by seeking the assistance of his statutory representative if the employer denies the employee’s request and compels the employee to appear unassisted at an interview which may put his job security in jeopardy.’

The appeals court ruled that the right is “infringed” when the employee is compelled to testify.  Conversely, the court held, “absent compulsory attendance, the right to union representation does not arise:  the [Supreme] Court expressly grounded its decision” on the notion that the employer could carry on its investigation without interviewing the employee and “‘thus leave to the employee the choice between having an interview unaccompanied by his representative, or having no interview.'”

The appeals court concluded that because the employer had stated in its letter that the employee could attend “if you choose” or submit a written response, attendance was not compulsory and Weingarten rights were not triggered

The court found there was no support for the Board’s reasoning.  The timing of the requests for representation, which were made contemporaneous with the interviews, was irrelevant.  The court, again reviewing the Weingarten decision, could find “no suggestion that the NLRA requires an employer to renew advice to an employee that her attendance at a hearing is optional.  And the Board cited no judicial or agency precedent establishing such a precedent.”

The court concluded its analysis by noting that the Board decisions relied upon by the agency were distinguishable because the employers in those cases compelled attendance in the interview.

Takeaways

This case is another example of the agency pushing the law by attempting to impose incremental changes, in this case adding the requirement that the employer’s initial advice that the meeting was optional be renewed when the request for union representation was made at the interview.  This case was easy for the court to decide because the language of Weingarten is clear in its requirement that the meeting be compelled in order to trigger the right to union representation.

The employer’s written advice helped avoid any dispute in this case.  Without the letter, whether the employee’s participation was optional would have been in dispute and the outcome of the case might have turned out differently.

Should an employer compel the interview?  There are good reasons not to.  It is frequently the advice that employers don’t compel an interview for the simple reason that one cannot sit an employee in a conference room and “sweat” them like they do on Law and Order.  Sure, the employer could punish an employee for refusing to participate but that gets farther way from the issue that led to the interview.  It is easier to give an option and tell the employee that the employer very much wants his/her participation but is prepared to make a decision without it.   If the employee chooses not to attend the employer will make a decision on the issue with the facts it has before it.  As the Supreme Court knew 42 years ago, many employees still will participate even without representation because the meeting often is the only opportunity to learn more about the issue and rebut claims.

Sometimes, parties to a collective bargaining agreement set forth Weingarten rights in the contract.  Since the right only applies in unionized settings it is a good idea to check the collective bargaining agreement to see if there are additional requirements agreed upon by the parties.  If the agreement is silent on Weingarten the employer should set internal guidelines about how to handle requests for representation to expedite the investigation and to minimize any problems.

Finally, because the rights afforded by Weingarten are still contested today, it is best to keep up on the law in this area.

Divided NLRB Rules Employer Policy Protecting Customer Information Is Lawful

Employers can prohibit the use by employees of the names, social security numbers and credit card numbers of customers in furtherance of organizational activities.  If this seems like it should have been a foregone conclusion, a recent case from the NLRB shows how the agency’s continued parsing of employer policies could easily have turned this notion on its head.

In Macy’s, Inc., 365 NLRB No. 116 (August 14, 2017) a number of the employer’s policies had been challenged as unlawful. Many of the policies were found to violate the Act.   The employer, an operator of department stores, chose to appeal only one aspect of its policies:  the Administrative Law Judge’s findings that the employer’s policies  prohibiting the use of customer information were unlawful.  The employer had three policies addressing use of customer information.

The first employer policy defined confidential information as follows:

What is confidential information?  It could be business or marketing plans, pricing strategies, financial performance before public disclosures, pending negotiations with business partners, information about employees, documents that show social security numbers or credit card numbers–in short any information, which if known outside the Company could harm the Company or its business partners customers or employees or allow someone to benefit from having this information before it is publicly known.

Just as our Company requires that its own confidential information be protected, our Company also requires that the confidential information and proprietary information of others be respected. . .

We are all trusted to maintain the confidentiality of such information and to ensure that the confidential information, whether verbal, written or electronic, is not disclosed except as specifically authorized.  Additionally, it must be used only for the legitimate business of the Company.

The Company also maintained a “USE OF PERSONAL DATA” policy:

The Company has certain personal data of its present and former associates, customers and vendors.  It respects the privacy of this data and is committed to handling this data responsibly and using it only as authorized for legitimate business purposes.

What is considered personal data?  It is information such as names, home and office contact information, social security numbers, driver’s license numbers, account numbers and other similar data.

The Use of Personal Data policy stated that employees must follow all “policies and measures adopted by the Company for the protection of such data from unauthorized use, disclosure or access.”

Finally, the Company maintained a “CONFIDENTIALITY AND ACCEPTABLE USE OF COMPANY SYSTEMS” policy:

Any information that is not generally available to the public that relates to the Company’s or the Company’s customers, employees, vendors, contractors, service providers, Systems etc., that you receive or which you are given access during your employment or while you are performing services for the Company is classified as ‘Confidential’ or ‘Internal Use Only.’

The employer’s Acceptable Use policy prohibited the sharing of such information with third parties.

The Charging Party union challenged these rules as unlawful, asserting that they would lead a “reasonable employee” to interpret them as prohibiting contact with customers during a labor dispute, something that is protected by the Act.  Complaint issued.

The Administrative Law Judge’s Decision

The Judge, after discussion of the policies in general, found the restrictions related to customers violated Section 8(a)(1), noting that the General Counsel “challenges the restrictions on the use of information regarding customers and vendors.  In certain situations, employees are permitted to use such information in furtherance of their protected concerted activities. . .”  There was little discussion of the actual language of the policies other than to note that it referenced “customer” information and that such information might include that used for purposes of protected activity.

Board Majority Sees It Differently

A two person majority (Chairman Miscimarra and Member McFerran) concluded the policies related to use of customer information were lawful.  The Board noted the policy identifying the information considered by the employer to be confidential “specifically defines” confidential information and the “only information covered by that rule that arguably relates to customers is ‘social security numbers or credit card numbers.'”  The Board noted that the General Counsel had conceded that employees do not have a right to use such information.  As to the Use of Personal Data an Acceptable Use of Company Systems restrictions, the Board held both rules “limit the use or disclosure of customer names and contact information”–information that could arguably be used in a labor dispute, but that “such rules “by their terms, only apply to customer names and contact information obtained from the [employer’s] own confidential records.”

The Board then cited the numerous cases holding that employees who use information taken from employer systems are outside the protection of the Act, including one where the employee had forwarded hundreds of company emails, some of which included confidential data, to a personal email account.

In a footnote, Chairman Miscimarra reiterated his call, set forth in prior cases as a dissent, that the test as to whether an employee would “reasonably construe” certain language to infringe on rights should be overruled and repudiated by the courts as unworkable.

Dissent Interprets Policies As Restrictive

Member Pearce dissented, stating employees “would reasonably interpret these broad rules as prohibiting or restricting their disclosure and use of customer information, for all purposes, including those that may implicate their terms and conditions of employment.”  The dissent argued what many employers asserted in defense of handbook policies,– that the majority was reading phrases of the policies “in isolation,” to come to its conclusion.  Specifically, the dissent noted that the definition of confidential information included “any information, which if known outside the Company could harm the Company….”  This phrase arguably isolates a few words while ignoring the more detailed definition preceding it.

Takeaways

This case is another example of how the standard of evaluating the lawfulness of language in a handbook can lead some very smart practitioners to come to widely disparate conclusions.  Here we have four seasoned labor professionals (an ALJ and three Board members) coming to different conclusions.  Indeed, the fact that the Chairman and Member McFerran were together in the majority is unusual enough (it’s probably happened on a case like this only a handful of times) to show that reasonable minds can and do differ as to the meaning of certain policies.  If these professionals cannot agree on what language constitutes a violation of the Act, then it certainly makes one wonder whether the “reasonable employee” who is envisioned in the standard would agree with any of the interpretations or hold a different view.    It seems likely the standard will be changed in the coming months as the make-up of the Board changes.

Until then, the drafting rules that have helped employers avoid problems of this sort remain in effect.  Tailor the policy to achieve the business objective.  In this case, the definition of confidential information was very specific, and narrow.  The types of information under the Use of Personal Data and Use of Company Systems policies were restricted, appropriately, to information that the employer collects as part of its business.

The case also offers an excellent recitation of all the instances where employee use of confidential information has been found to be unprotected.

NLRB Gains A New Member As Marvin E. Kaplan Is Sworn In

The NLRB announced today that Marvin E. Kaplan was sworn in as the agency’s newest Board member.  Member Kaplan’s term expires August 27, 2020.  The Board complement now stands at four of five members.  Congress delayed confirmation of the President’s other appointee, William Emanuel, until at least September.  Assuming Mr. Emanuel is confirmed when Congress returns the Board will have a full complement for the first time in several months.  Having five members may only last for approximately 90 days, however, as Chairman Miscimarra recently announced he would leave when his appointment expires in December 2017.  So we can expect another appointment to the Board sometime in the Fall.

There exists a great deal of interest on what is happening at the Board.  Changes to case law can only occur when a majority of the panel agrees and as of this moment there is the possibility of a 2-2 split over the many legal issues currently dividing the labor relations community.

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