Labor Relations Update

D.C. Circuit Remands Hotel Certification Decision and Reminds Board to Explain Its Reasoning

On October 23, 2020, the D.C. Circuit granted Davidson Hotel Company’s petition for review of unfair labor practices resulting from its refusal to bargain with two newly-certified bargaining units, and denied the NLRB’s cross-petition for enforcement of an order to engage in collective bargaining with those units.

The Circuit also remanded the underlying unit certification decision to the Board, noting that the NLRB failed to persuasively distinguish relevant precedent presented by the employer and otherwise address the employer’s valid arguments.

Background

The Union initially petitioned the Regional Director to certify a single bargaining unit of hotel employees comprised of housekeeping and food and beverage employees—but excluding front desk employees. The Regional Director first considered whether the employees in the petitioned-for unit share a “community of interest,” and then if so, whether the proposed unit “share[s] a community of interest sufficiently distinct from employees excluded from the proposed unit to warrant a separate appropriate unit[.]”  The traditional “community-of-interest” factors include consideration of, among other things, job functions of the employees in question, department organization and terms and conditions of employment.

Under this standard, the Regional Director declined to certify the petitioned-for-unit, finding that the front desk employees were not sufficiently distinct from the other employees to warrant a separate unit.  However, in his conclusion, the Regional Director briefly suggested that separate units would be appropriate.

Taking the cue from the Regional Director’s suggestion regarding separate units, the Union filed two new petitions the next day to certify a unit of housekeeping employees and a separate unit of food and beverage employees. As before, the Union excluded front desk employees altogether. The Regional Director again applied the “community-of-interest” standard to the newly-proposed units, and certified the two units as appropriate and directed elections. Shortly thereafter, the employees in each unit voted in favor of the Union.

The employer refused to bargain with the newly-certified units, and the Union filed a refusal to bargain unfair labor practice charge against the employer.  In response to the charge, the employer objected to the certification, arguing that the Regional Director departed from several prior Board decisions rejecting separate bargaining units in the hotel context, as well as the precedent established by the RD in the first unit decision in this case—namely, that the RD’s decision counseled against excluding the front desk employees from the first decision, but not in the second.  The Board rejected the petition without explaining its reasoning or attempting to distinguish the precedent relied on by the employer in a 2-1 vote.

On appeal to the D.C. Circuit, the Court admonished the Board for its lack of analysis, noting the employer presented the Board with precedent that was directly analogous, holding that separate bargaining units in the hotel context were inappropriate.  The Board failed to engage in any application to the facts at hand and distinguish those cases from the present.

Takeaways

This decision reinforces D.C. Circuit precedent—which is important for any practicing labor law attorney, employer, union or employee, as any NLRB decision may be appealed to the D.C. Circuit—that the Board must explain its reasoning when certifying bargaining units.  Fatal to the Board’s decision here was that it failed to reconcile the Regional Director’s initial decision (which found that excluding front desk employees was inappropriate) with the subsequent decision (which concluded that front desk employees need not be included in the unit), and did not even attempt to distinguish the arguably on-point Board precedent from the hotel industry.

When remanding the case, the D.C. Circuit noted that “We should not be understood as requiring the Board to distinguish every case cited to it by a party…To say otherwise would be to hold the Board to a higher standard than we hold ourselves…. We simply reiterate that when faced with contrary precedent directly on point, the Board must distinguish it.”

Lurking in the background of this case is the Board standard for evaluating bargaining units.  Several years ago the Board changed the traditional of community of interest standard, which also relied heavily on precedent in the particular industry, in favor of the so-called “micro unit standard.”  Undoubtedly, the two separate units would be found to be appropriate under this standard.  In recent years, as political winds changed, the Board abandoned the micro unit standard in favor of the more traditional analysis.  This traditional analysis made the employer’s citation to industry precedent not only important, but fundamental to the Court’s determination.

Political winds recently shifted and so may the Board’s standard for evaluating bargaining units.

We will keep you posted!

 

Handbook Civility Rules Aimed at Preventing Toxic Work Environments Found Lawful by NLRB’s Division of Advice

The NLRB’s Division of Advice recently released a long-awaited Advice Memorandum (originally issued in February 2019, Chipotle Mexican Grill, Case 28-CA-229134 (Feb. 22, 2019)) concerning the validity of two workplace rules under the Boeing standard: (1) a rule encouraging employees to “[b]e…objective” in their communications; and (2) a rule requiring employees to notify the employer of inquiries or requests for information from governmental entities.

Advice concluded the rule concerning employee communications was a lawful workplace civility rule under Boeing, but the government investigations directive violated the Act because it could be applied to investigations by the NLRB or other agency investigations/proceedings.

Policy on “Ethical Communications” is a Lawful Civility Rule under Boeing

Advice reviewed a rule maintained in the employee handbook under the heading, “Ethical Communications”, which primarily served as an anti-discrimination and harassment policy, but also encouraged employees to “[b]e clear and objective” in their communications. Advice evaluated whether the policy could reasonably be interpreted as interfering with protected concerted activity.

Upon inspection, Advice determined that the policy, read as a whole, was lawful and unlikely to be understood by employees as prohibiting protected activity. Although the requirement to “be…objective” could theoretically be read as restricting some forms of protected, subjective speech, Advice concluded that “the entire rule read in context is best understood as the sort of civility rule the Board has found lawful under Boeing”. The provision of the rule requiring employees to “be…objective” appears alongside other requirements that employee communications be “fair and courteous,” “thoughtful and ethical,” and do not “constitute harassment or bullying.” While the rule included some restrictions on the content of employee communication, such as disparaging speech, Advice found it was clear that this provision of the policy restricts disparagement of customers and other employees, which has little to no impact on Section 7 activity.

Under the second prong of the Boeing analysis, Advice considered the employer’s legitimate business justifications for maintaining the proper employee communication policy and determined that the employer’s legitimate interests outweighed any potential impact the rule might have on protected activity. Advice explained that employers have an interest in maintaining civility rules like the kind at issue in this case, including the “employer’s legal responsibility to maintain a workplace free of unlawful harassment, its substantial interest in preventing violence, and its interest in avoiding unnecessary conflict or a toxic work environment that could interfere with productivity and other legitimate business goals.” The purpose of the policy was not to prevent employees from publicly criticizing the terms and conditions of their employment, but rather to ensure employees remained civil in their communications in the workplace, which is lawful.

Employer’s “Government Inquiries/Investigations” Rule Facially Unlawful under Boeing

Advice reviewed another rule in the employee handbook, entitled “Government Inquiries/Investigations”, which stated that “[a]ny inquiry, request for information, or subpoena from a government agency or authority should be forwarded immediately to the Compliance Department, the Safety, Security and Risk Department or Chipotle’s General Counsel or, in the case of tax audits, to the Chief Financial Officer.”

Advice concluded this policy was unlawful because, on its face, it restricts employees from participating or cooperating in investigations conducted by the NLRB and other government agencies. Advice explained that employees have a right under Section 7 of the NLRA to “cooperate in Board investigations or to concertedly participate in investigations by other regulatory or law enforcement agencies.” Employees would reasonably understand the rule as prohibiting them from providing requested evidence or otherwise participating in a government investigation without first communicating with the employer.

Although the employer argued that the rule only applies to government inquires addressed to the employer and not to individual employees, and that it has a legitimate interest in ensuring it is aware of governmental inquires and communications addressed to it, Advice found this explanation insufficient where the text of the rule failed to draw a distinction between government inquiries addressed to the employer and those addressed to individual employees.

Takeaways

The Advice Memorandum solidifies (for now, anyway) the NLRB’s approach to workplace civility rules, as originally expressed in Boeing, where the Board held that civility rules requiring harmonious workplace relations and professional and appropriate conduct are generally lawful and fall within Category 1 under Boeing. Here, Advice indicated that a policy regulating employee communications with customers and other employees in the workplace falls squarely within the realm of lawful civility rules under NLRB jurisprudence. Employers should thus keep in mind that, while certainly not limitless, preventing a toxic work environment is a legitimate business justification for a policy that could potentially interfere with employees’ rights to engage in protected concerted activity.

The second rule evaluated by Advice regarding disclosure of government investigations and inquiries to the employer before responding is a helpful reminder to employers of the importance of careful and thoughtful drafting when it comes to handbook policies. While the employer in the case intended only to ensure that communications from government agencies and regulatory bodies made their way to the employer, the policy did not sufficiently make the limited scope of the policy apparent. Employers should thus ensure that any policies concerning government investigations are narrowly tailored, making clear that employees are free to cooperate with government requests for information and other inquiries without restriction or interference.

This is an appropriate time to note that the standards enunciated in Boeing could change in the coming months as the Executive Branch will change parties on January 20, 2021. The change in administration will ultimately cause a change to the make-up of the NLRB. It was only a few short years ago that all rules at issue in this case likely would have been found to be unlawful by the Board. We will, as always, keep you posted of important developments in this area.

NLRB: Employer Tweet Unlawfully Restrained Protected Activity

On November 24, 2020, the Board held that a high-level executive’s tweet violated Section 8(a)(1) of the NLRA by interfering with or restraining employees’ protected, concerted activity.

In FDRLST Media, LLC, 370 NLRB No. 49 (2020), the Board reaffirmed its longstanding principle that a violation of Section 8(a)(1) does not depend on the employer’s motive or tone.  An executive’s tweet threatening employees that if anyone “tries to unionize I swear I’ll send you back to the salt mine” violated the Act because a reasonable employee could view it as expressing an intent to take adverse action against employees who attempted to organize a union.

Background

On June 6, 2019, news organizations covered the story of a walkout by union employees at Vox Media, an online digital media network and publisher.  On the same day as the walkout, an executive officer of the employer and publisher of the Federalist magazine tweeted:  “FYI @fdrlst first one of you tries to unionize I swear I’ll send you back to the salt mine”.  The tweet was posted using the executive’s personal Twitter handle.  There was no evidence that employees of the employer had contemplated union organizing.  Indeed, the Administrative Law Judge noted the individual who had filed the unfair labor practice charge in this matter “is not and never has been an employee” of the employer.

On April 22, 2020, an administrative law judge (“ALJ”) found that the tweet violated Section 8(a)(1) of the Act, even though the employer argued that it had no malicious intent and that the alleged coercive communication did not succeed.  The Board affirmed the ALJ’s holding, citing American Freightways Co., 124 NLRB 146, 147 (1959), where the Board concluded that an employer may violate the Act regardless of its “motive or whether the coercion succeeded or failed.”  Rather, “[t]he test is whether the employer engaged in conduct which, it may reasonably be said, tends to interfere with the free exercise of employee rights under the Act.”

The Board upheld the ALJ’s conclusion that a reasonable employee would view the tweet as threatening unspecified reprisals against employees who engaged in union activity.  The ALJ found that the words “FYI” or ‘For Your Information” combined with the usage of @fdrlst was clearly directed at employees working at the Federalist – not the general public.  The ALJ noted that use of the term “salt mine” often referred to work that was tedious and labor-intensive, and reasonably indicated a worsening of working conditions if the employees unionized.

The Board agreed, finding that, even though the statement was publicly posted on Twitter, “the words of the statement itself leave no doubt that it is directed at the Respondent’s employees.” Furthermore, the Board cited precedent holding that even a threat not directed at employees but seen by them would still violate Section 8(a)(1).

The Board rejected  the employer’s defense that the tweet was protected by Section 8(c) as an expression of a personal viewpoint on a newsworthy topic.  Citing Webco Industries, 327 NLRB 172, 173 (1998), the Board stated that Section 8(c) does not protect implicit threats of reprisals.  The Board ordered the employer to direct the executive to delete the statement from his Twitter account.

Takeaways

This case illustrates something many employers find out too late: that under the rules and regulations of the NLRB, anyone can have standing to bring an unfair labor practice charge. Moreover, it costs nothing to file a charge and the charging party need not participate beyond providing information to the agency.  While the parties stipulated that “at least one employee” viewed the Twitter feed of the executive, no employee complained or even participated in the case.  Someone who merely saw the statement on Twitter set in motion the agency apparatus resulting in unfair labor practice liability.

This case does not change the underlying law and reinforces the longstanding principle that the Board’s only inquiry into whether a statement is coercive is to look at the words themselves.  That this tweet may have been a sarcastic attempt at humor, is irrelevant.

This case does demonstrate how flippant comments on social media can cause issues for employers.  In recent years, the Board has paid closer attention to the statements of high-level executives on social media.  As demonstrated here, the test of whether the conduct—a statement by a statutory supervisor—amounts to interference or coercion with respect to employees’ ability to engage in protected, concerted activity is objective, and does not depend on the intent or motive of the employer (or its agents).  Nor does such a finding depend on the subjective feelings of the employees with respect to the statement.  The case reaffirms the need by employers to effectively train and remind statutory supervisors that public social media use, even statements issued from a personal account, can bring liability under the National Labor Relations Act.

NLRB Establishes Pathway to Holding More In-Person Manual-Ballot Elections during the COVID-19 Pandemic

As employers faced with a representation petition filed during the COVID-19 pandemic can attest, Regional Directors of the National Labor Relations Board have been incredibly reticent to hold in-person elections.  Indeed, since April 1st, when the Board resumed processing representation petitions, approximately ninety percent (90%) of elections have been held by mail rather than in-person.  This necessary paradigm shift flew in the face of the Board’s long-standing general policy to hold manual-ballot, in-person elections.  However, on November 9, 2020, the Board finally provided Regional Directors and key stakeholders, such as employers, employees and unions with important guidance concerning when, and how, to decide whether to hold a representation election by manual- or mail-ballot.

Background

In Aspirus Keweenaw, 18-RC-263185, 370 NLRB No. 45 (2020), the Employer argued that a manual election was warranted based on the Board’s preference for manual-ballot elections and the relatively-low prevalence of COVID-19 in its Michigan county.  The Employer also agreed to comply with the manual-ballot election protocols issued by the Board’s General Counsel on July 6, 2020 in GC Memo 20-10.  That Memo set out a detailed protocol of how to hold in-person voting during the COVID-19 Pandemic, including detailed elections mechanics, health certifications, an agreement to notify the Region of any indication that individuals present at the voting location contracted COVID-19, and arrangements to ensure social distancing and compliance with CDC guidelines.   Nonetheless, the Region, in Aspirus Keweenaw, ordered a mail-ballot election due to safety concerns and applicable governmental guidance.

The full Board reversed the Regional Director’s decision and articulated a new six-“situation” test to determine whether an election should be held by mail rather than by manual ballot.  Notably, the Board indicated that the presence of “one or more” of these situations “normally” suggests the use of a mail ballot due to the extraordinary circumstances of the COVID-19 pandemic:

  • The Agency office tasked with conducting the election is operating under “mandatory telework” status.
  • Either the 14-day trend in the number of new confirmed cases of COVID-19 in the county where the facility is located is increasing, or the 14-day testing positivity rate in the county where the facility is located is 5 percent or higher.
  • The proposed manual election site cannot be established in a way that avoids violating mandatory state or local health orders relating to maximum gathering size.
  • The employer fails or refuses to commit to abide by GC Memo 20-10, Suggested Manual Election Protocols.
  • There is a current COVID-19 outbreak at the facility or the employer refuses to disclose and certify its current status.
  • Other similarly compelling circumstances.

The Board clarified that none of these situations require a mail-ballot election.  Instead, the determination remains at the discretion of the Regional Director, but “a Regional Director who does direct a mail-ballot election under the foregoing situations will not have abused his or her discretion.”  In other words, Regional Directors who follow the Board’s guidance likely will not be reversed on this issue by the Board on review.

In Aspirus Keweena, the Board reversed and remanded the Regional Director’s decision requiring a mail-ballot election for further consideration consistent with the new standard.

Takeaways

The country continues to be challenged by the COVID-19 pandemic, with outbreaks varying by state and locality.  As evident over this past year, the normal operations of the NLRB, including the type and manner of representation elections, has been significantly affected.  Namely, the ongoing pandemic has resulted in far more mail-ballot than manual-ballot elections.

The Board’s decision helpfully articulates clearer guidance for Regional Directors faced with the unenviable task of deciding whether to hold in-person or mail-ballot elections at an employer’s site during the pandemic.  The decision also gives employers and unions some criteria to use to argue over the type of election to be conducted. This decision both lays the groundwork for a possible return to the long-standing tradition of in-person elections (which may be a boon for employers who prefer in-person voting), while also recognizing the gravity of the safety and health crisis that the country is currently experiencing by providing multiple situations in which a manual election almost certainly would not be ordered.

As with all things related to COVID-19 and the NLRB, this situation is fluid and we will continue to follow it.  Stay tuned!

NLRB Seeks Comment: Rats, Banners and Neutrals, Oh My!

An age old question under the National Labor Relations Act is what constitutes “picketing”?  By the Supreme Court’s definition, picketing is inherently coercive and may not be directed against a neutral employer.  An issue that has vexed employers for the last several years has been the use of stationary protests, such as inflatable rats and banners, calling out neutral companies for doing business with the employer.  For approximately 10 years, which in recent Board history is as longstanding as precedent gets, the Board has ruled that such stationary protests are not coercive and, therefore, not unlawful under the Act.

As foreshadowed by the NLRB’s Division of Advice last year, the Board, on October 27, 2020, published a notice and invitation to file briefs addressing issues concerning the legal standard applicable to unions’ use of the most recognizable signs of unionism and labor disputes in urban areas today – inflatable rats and banners.  The practice is so common that it spawned a new verb:  bannering.

Background

Section 8(b)(4)(i) of the NLRA prohibits labor organizations, or their agents, from inducing or encouraging secondary (i.e., neutral) employees from participating in certain prohibited activities, and Section 8(b)(4)(ii) protects secondary employers from threats, coercion or restraint.

In 2019, in International Union of Operating Engineers, Local Union No. 150 a/w International Union of Operating Engineers, AFL-CIO and Lippert Components, Inc., Case No. 25-CC-228342, 370 NLRB No. 40 (2020), an Administrative Law Judge (“ALJ”) found that the Union’s stationary display of a 12-foot inflatable rat and two large banners, which read “OSHA Found Safety Violations Against [the Primary Employer]” and “Shame on [a Neutral Employer] for Harboring Rat Contractors,” did not amount to picketing or coercive non-picketing conduct under the NLRA.

The ALJ relied on two cases, Eliason & Knuth of Arizona, 355 NLRB 797 (2010) and Brandon Regional Medical Center, 356 NLRB 1290 (2011), in making her decision.

  • In Eliason, the NLRB found that the display of large, stationary banners, which announced a labor dispute, shamed the neutral employer and urged the public not to patronize the neutral employer, did not rise to the level of proscribed picketing because they were neither confrontational (unlike a patrolled picket) nor coercive (e., they did not disrupt or threaten to disrupt the neutral employer’s operations).
  • The NLRB found in Brandon Regional Medical Center that the presence of a 16-foot inflatable rat mounted on a trailer on public property outside of the neutral employer’s place of business was not unlawful picketing or otherwise coercive conduct.

In response to the ALJ’s decision, the Board’s General Counsel, consistent with prior advice on the subject, has requested that the NLRB overrule Eliason and Brandon Regional Medical Center because those decisions resulted in narrower definitions of picketing and coercion, created “vague and imprecise” standards, and, according to the General Counsel, strayed from NLRB precedent and Section 8(b)(4) of the NLRA. The General Counsel equates the rat and banner display in this case with classic picketing or coercive conduct that unlawfully pressured the neutral employer to no longer conduct business with the primary employer involved in the labor dispute.

Issues for Consideration by the Board

Parties and amici are invited to file briefs on or before November 27, 2020, to aid the NLRB in its consideration of the following questions:

  1. Should the NLRB adhere to, modify or overrule Eliason and Brandon Regional Medical Center?
  2. If you believe the NLRB should alter its standard for determining what conduct constitutes proscribed picketing under Section 8(b)(4), what should the standard be?
  3. If you believe the NLRB should alter its standard for determining what non-picketing conduct is otherwise unlawfully coercive under Section 8(b)(4), what should the standard be?
  4. Why would finding that the conduct at issue in this case violated the NLRA under any proposed standard not result in a violation of the Respondent’s rights under the First Amendment?

Member McFerran’s Vigorous Dissent

Member Lauren McFerran dissented, stating that the NLRB should decide this case without comment pursuant to existing law. McFerran asserts that the General Counsel is threatening employees’ First Amendment right to free speech – which affords protection even to speech that is unsettling or offensive in this context – by asking the NLRB to overrule well-established precedent concluding that the use of stationary inflatable rats and banners to publicize a labor dispute is lawful under Section 8(b)(4). In support, McFerran cited numerous NLRB and federal court decisions affirming and applying existing Board precedent, including 12 NLRB decisions since the 2010 Eliason decision where the NLRB has declared stationary banners or inflatables lawful under the Act.

Takeaways

Inflatable rats and banners are a universal protest symbol for labor unions throughout the country, and they are often parked outside of neutral employers’ offices to signal opposition against primary employers and/or non-union contractors with which the labor union has a dispute. Likely due to recent criticism by not accepting comment after overturning well-established precedent, the Board has opened the door to all constituencies to comment on this hotly-contested issue, inviting contemporary interpretation of the scope of picketing and coercive conduct under Section 8(b)(4) of the NLRA.  The impact of a potential decision that overturns Eliason and Brandon Regional Medical Center could be significant, in that it may dramatically change the tactics available to unions in exerting pressure on neutral employers in the cross-hairs of a labor dispute.  For some short period anyway, maybe even as long as 10 years!

NLRB Advice Memorandum: Firing Employees Because of Discussions Related to Tip-Pooling Violates Section 8(a)(1)

In an Advice Memorandum released Thursday, the NLRB’s Division of Advice concluded that employees who discussed an employer’s tip-pooling practices engaged in protected concerted activity, such that discharging the employees for this activity violated Section 8(a)(1) of the NLRA.

Employees working at a steakhouse in New York City often complained about the restaurant’s tip-pooling system. Under the system, management counted and divided tips among employees regardless of the employees’ shift.

The Advice Memorandum noted some employees “objected to the non-transparency and unfairness of the Employer’s tip compensation system” during various pre-shift and staff meetings. In response, the Employer repeatedly warned employees “to not complain or talk to each other about the tip issue, and that doing so could endanger their jobs.” The Employer repeatedly told employees that continuing to talk about the tip-pooling system would result in adverse consequences, including job losses. The four charging employees were eventually discharged pursuant to the Employer’s progressive disciplinary policy, for stated reasons including alleged insubordination and common infractions that were inconsistently disciplined.

The Advice Memorandum concluded that “employee discussions and complaints about employers’ tip policies are ‘undeniably’ protected by Section 7.” The Memorandum compared the issue here to the Board’s recent decision in Alstate Maintenance, which we previously discussed here. Alstate involved a statement made by a skycap working for a contractor at JFK International Airport. A supervisor told the skycap and three of the skycap’s co-workers that an airline had requested skycap assistance handling a soccer team’s equipment. In front of the other skycaps, the charging party employee stated that they had done a similar job earlier and did not receive a tip for it. When the soccer team arrived and the skycaps walked away, the employee told a manager that the skycaps did not want to complete the job because of the anticipated small tip.

The Board in Alstate found that the skycap’s first statement was not intended to induce group action about a workplace concern; rather, it amounted only to a mere gripe. In this case, however, the charging party employees “acted concertedly by repeatedly bringing employees’ concerns” regarding tip-pooling to management.

Also unlike the steakhouse here, the Alstate employer had no control over the customer’s tip practice, so the skycap’s statement was not for the purpose of mutual aid or protection. The steakhouse employees’ conduct was protected concerted activity as the Employer controlled the tip-pooling policy.

The Advice Memorandum also concluded there was “a nexus between the Charging Parties’ protected activity and the Employer’s discharge decisions.” The Advice Memorandum pointed to various aspects of the record that showed animus towards the employees’ complaints was a motivating factor for the discharges, such as the Employer’s targeting the employees for discussing the tip-pooling practice, and the Employer’s telling employees that it intended to “clear out” employees talking about tips. The Advice Memorandum concluded the Employer’s stated reasons for discharging the charging party employees were pre-textual. The Advice Memorandum directed that complaint issue in the case.

Takeaways

This is a classic case where an employer’s direct threats to quell protected activity of its employees resulted in a complaint being issued. In that regard it is unremarkable; it is fairly easy for the agency to draw a straight line between an explicit threat to terminate over group discussion (which is a separate violation of the Act) and the discharge itself. So why was the case sent to Advice?  The likely reason is the Alstate decision by the Board appeared to be similar and the Region wanted guidance as to how to proceed. In the end the Advice Memorandum and the Alstate Board Decision are consistent applications of the law. The General Counsel publishes Advice Memoranda from time to time as a guide to the public about its current thinking, and it helps to clarify the difference between a gripe about a particular type of customer, and the employer’s policy of taking tips slated for a particular employee and sharing these monies with all employees.

It is also important to note that many state and local laws prohibit punishment for discussion of compensation. Also, tip-pooling has been the subject of many a class action lawsuit alleging that the practice deprives the recipient of monies given to the person.

NLRB: Members Of Trade Group Are Not “Employees” Covered By The NLRA

On September 11, 2020, a three-member National Labor Relations Board panel unanimously ruled that a trade group representing sign language interpreters did not violate Section 8(a)(1) of the Act by removing its members’ posts on its closed Facebook page.  The posts, made by individual members of the trade group, discussed the interpreters’ work conditions and supported unionization.  According to the Board, because the interpreters were not the organization’s employees and thus, not covered by the Act, the trade group could lawfully remove the posts.

In Registry of Interpreters for the Deaf, Inc. and Pacific Media Workers Guild, Local 39521, Case No. 20– CA–164088, the charged party–Registry–is a national professional association of interpreters for deaf individuals.  The trade association maintained an antitrust policy and a civility policy in connection with its members’ use of its private Facebook page.  The antitrust policy prohibited members from using its Facebook page and other online forums as a platform to set prices, fees and other terms for their services.  The civility policy restricted members from using the Facebook page for solicitation.  It further required members to show “mutual respect” and gave the trade association discretion to remove posts it found to be in violation of either policy.  In October 2015, the trade association removed several Facebook posts by members discussing their work conditions and expressing support for unionizing, because they violated the trade association’s policies.

An unfair labor practice charge was filed by a union, which resulted in a complaint being issued.  The parties stipulated to the facts which were not in dispute.

Relying on a 2011 Board decision, New York, New York LLC, 356 NLRB 907 (2011), which this Board overruled last year in Bexar County Performing Arts Center Foundation d/b/a Tobin Center for the Performing Arts, 368 NLRB No. 46 (2019) (which we previously covered here), the ALJ held that the trade association’s members were akin to employees of a contractor who performs work on another employer’s premises and were therefore employees covered by the Act.

In reversing the ALJ, the Board found that none of trade association’s members were employees. The trade association did not control, even indirectly, the members’ wages, hours or working conditions.  Nor did the trade association compensate its (approximately 16,000) members.  None of the members performed work for the trade association (either on the trade association’s physical property or in its electronic forums), or for a contractor of the trade association.  Further, the members did not perform work integral to trade association’s business, nor was the registry’s business as a trade association dependent upon the services of its members.  The members whose posts were removed did not identify as trade association’s employees.  Furthermore, only a fraction of the trade association members were employees of any employer.  The Board explained that “[t]hose facts are particularly significant: if the [trade association] does not, even indirectly, control the employee members’ wages, hours, or working conditions, it cannot be found to restrict or interfere with the employee members’ rights as employees.”

The Board did not analyze whether Registry’s policies were lawful under Boeing Co., 365 NLRB No. 154 (2017), choosing instead to dismiss the charge based on the threshold issue of whether the members were statutory employees.

Takeaways

This is an interesting case where the outlines of the coverage of the NLRA. On the surface it appears individuals attempted to discuss the merits of unionization on an online forum, and the posts were removed.  Had such an action been conducted by an employer removing the employee’s posts, there is little doubt such conduct would violate the Act.  In this case, the forum used by the interpreters, and the charging party union, was a closed Facebook page of a trade association.  It seems clear the real target of the union’s organizing efforts was the various employers employing interpreters for various tasks.

The stipulated facts contain the following, which was not cited by either the ALJ or the Board probably because it was a legal conclusion:  “[T]he individual interpreter-members are not employees of [trade association] within the meaning of Section 2(3) of the Act and are not on a long-term or continuous contracted status with the [trade association]”  Section 2(3) of the Act broadly defines the term “employee” to “include any employee, and shall not be limited to the employees of a particular employer. . .”  Ultimately, in Board case law, employee status typically comes down to economic control of the individual.  Here, the trade association’s lack of control over any of the terms and conditions of its members’ work was crucial to the Board finding that they were not employees for purposes of the Act. As such, the interpreters did not have a Section 7 right to post about unions or terms and conditions of employment.   This ruling provides additional clarity in determining whether individuals who do not have an employment relationship with an employer are nevertheless covered by the Act.

NLRB Issues Several Advice Memoranda Providing Guidance on COVID-Related and Other Workplace Issues

On September 15, 2020, the National Labor Relations Board (the “NLRB” or “Board”) Division of Advice (“Advice”), published four Advice Memoranda addressing an array of issues ranging from COVID-19-related unilateral actions to non-work political advocacy and the legality of confidentiality provisions in separation agreements.  The Memoranda were drafted by Advice last month, and join the panoply of other recent guidance released by Advice on July 15 and August 13.

Advice Memoranda are only binding on the parties subject to the instant dispute, but they are publicly released to give the public an idea of how the agency might handle similar issues, and thus are instructive to employers, unions and employees considering their rights and obligations under the National Labor Relations Act (the “NLRA” or “Act”).

Unilateral Changes Pursuant to Management-Rights Clause and Effects on Bargaining Obligations in light of COVID-19

In Comcast Cable, Advice considered whether a contractual management-rights clause permitted Comcast to unilaterally require employees engage in “home-garaging”, or the keeping of company trucks in their home garages.  The Board analyzed this under the “contract-coverage” doctrine set forth in MV Transportation, 368 NLRB No. 66 (2019).  After examining the management-rights clause in the contract—which authorized the employer “to make and enforce new work rules,” including “operational rules and procedures…and safety rules and procedures” as well as other strong language evidencing Comcast’s managerial discretion in its business operations—Advice concluded that Comcast had contractual authority to implement the policy to protect workers.

While Advice acknowledged Comcast had the contractual right to implement the decision regarding home-garaging, Advice also found that the parties reached a bona-fide impasse over the “effects” of the policy, citing the parties’ numerous conversations about the policy between, and where the parties exchanged numerous good-faith proposals regarding the scope and length of the policy.  While Comcast refused to establish home-garaging as a permanent feature, it nevertheless sought potential compromises and continued to solicit counteroffers, demonstrating the employer’s proposal was not delivered as fait accompli.

Interestingly, the Region asked Advice whether it should issue Complaint to urge the Board to expand the “exigent economic circumstances” exception of the duty to bargain because Comcast argued the pandemic required it to implement the home-garaging policy for health and safety (but not economic) reasons.  Because Comcast bargained to impasse over the “effects” of the home garaging policy, Advice opted not to address the “exigent-economic-circumstances” issue.

Unilateral Implementation of COVID-19 Safety and Benefits Policies

In another COVID-related Advice memo, Mercy Health Partners, the employer, a hospital network, made numerous changes to its policies and benefits without first notifying the Union and providing an opportunity to bargain.  The hospital network altered its policies related to the use of personal protective equipment (“PPE”), hospital visitors, COVID-related paid leave and time away from work, delegation of ICU nurse duties to others, travel reimbursement (to encourage social distancing), event reporting processing for COVID-related events, and assignments/safety protocols for immunocompromised or pregnant staff.

Advice concluded that the employer did not violate Sections 8(a)(5), 8(a)(1) or 8(a)(3) of the NLRA because the unilateral changes were (i) legally mandated by state executive orders, or (ii) reasonably related to the COVID-19 emergency.  Advice also found that the employer satisfied its obligation to bargain post-implementation by negotiating or communicating its position on each item over which the Union requested to bargain.  Further, the parties continued to meet on a weekly basis to negotiate pandemic-related “effects” on the hospital network’s employees.

Additionally, Advice found that the policy changes regarding the use of PPE was not discriminatory or retaliatory because the policy applied even-handedly to unit and non-unit employees alike.  Advice agreed with the Region’s recommendation to dismiss the charges.

Non-Work Related Political Activity

In UFCW 1994 MCGEO, an employee who worked as a union representative for a labor organization representing uniformed police officers was discharged “for working on police transparency and accountability legislation . . . in [their] capacity as a state legislator.”  The employee’s advocacy for police reform occurred while the employee was acting as a Maryland State delegate and “testifying before a local county council and otherwise.”  Advice concluded that the employer did not violate Section 8(a)(1) of the Act when it discharged the employee, as the employee’s advocacy was not at all related to their employment for the employer; nor did that advocacy have any connection to an employment concern of any employee.  Rather, the employee “acted in the interest of the community at large and in furtherance of [their] own political agenda” when they advocated for police reform.  Given that the Act “does not protect employee political advocacy that has no nexus to a specifically identified employment concern,” Advice recommended that the Region dismiss the unfair labor practice charge related to this activity.

Separation Agreements Prohibiting Workers from Discussing Wages

In Modernize Inc., Advice evaluated the legality of a separation agreement that included language prohibiting the employee from discussing terms and conditions of employment.  As background, in July 2019, an employee was discussing compensation with a co-worker, encouraging the co-worker to seek a raise, the employee was told by management numerous times to stop discussing compensation with other employees.  The employer ultimately terminated the employee for “continuing to disclose private conversations”, and the parties entered into a separation agreement that included a general release from all legal claims in exchange for three weeks’ pay.  The separation agreement contained a confidentiality provision, which required the employee to keep the agreement’s terms confidential, except for consultations with an attorney or family member.  It also contained a non-participation provision, which prohibited the employee from voluntarily participating in any judicial or adversarial proceeding relating to his or her employment or termination.

Without addressing whether the employee’s discharge was lawful, Advice concluded that the separation agreement – including its confidentiality and non-participation provisions – was lawful.  Citing Shamrock Foods Company, 366 NLRB No. 117 (2018), Advice reasoned that the Board has upheld similar confidentiality provisions as lawful and that when read in its entirety, the non-participation provision was lawful because it did not restrict the employee’s ability to participate in Board investigations or proceedings either individually or on behalf of a co-worker.

Advice also recommended that the Region honor the release of claims contained in the separation agreement, including to the NLRA claims raised against the employer.  Applying the four-factor test set forth in Independent Stave Co., 287 NLRB 740 (1987), Advice reasoned that: (i) there was nothing to suggest that the employee did not intend to enter into the separation agreement and, as such, all parties agreed to be bound; (ii) the settlement at issue was reasonable given “serious weaknesses in the Region’s theory of the case,” as the Board has recently questioned precedent holding that employers violate the Act by forbidding workers from discussing wages; (iii) there was no “undue pressure” on the employee to execute the agreement, as the employee was highly compensated, was given ten days to consider the agreement, and was encouraged to consult with an attorney; and (iv) the employer’s potential violations of the Act were not tied to an “unlawful scheme.”

We will continue to monitor Advice’s guidance to the labor and management community, as well as Board cases on these important timely topics.

No Reasonable Expectation of Recall? No Election: Board Cancels Union Election at Casino Closed During COVID-19

The National Labor Relations Board recently cancelled a union election at a Las Vegas casino that suspended its operations and laid off employees amid the COVID-19 pandemic. In NP Texas LLC d/b/a Texas Station Gambling Hall and Hotel and Local Joint Executive Board of Las Vegas, 370 NLRB No. 11 (2020), the Board found that the Regional Director erred in scheduling the election given that the laid-off employees had no “reasonable expectation of recall” and thus were ineligible to vote.

Texas Station Casino and the COVID-19 Pandemic

On March 18, 2020, the Governor of Nevada issued an emergency declaration directing that all casinos cease operations until April 16. In accordance with the Governor’s order, Station Casinos informed its employees that it would be temporarily closing its properties, including Texas Station Gambling Hall and Hotel (the “Texas Station Casino”). Although some supervisors at the Texas Station Casino informed their subordinates in early March that they would likely be recalled in April or May, the Governor twice extended its emergency order and all casinos remained closed.

On April 29, the Governor ordered gaming operations to remain closed through May 15, and until the Nevada Gaming Control Board determined that operations could safely resume. On May 1, Station Casinos sent a letter to all of its employees outlining a reopening plan at its “Phase One” properties. According to the letter, all “Phase Two” properties, including the Texas Station Casino, would remain closed. The letter further stated that while there would be staff reductions, Station Casinos was hopeful that it would be able to “rehire many of our valued team members when we emerge on the other side of the crisis.”

Each team member separately received a communication with respect to his or her employment status. The petitioned-for employees received termination letters, which indicated that their employment would be terminated because the Texas Station Casino “made the difficult decision to temporarily close.”

Over the next several weeks, the Governor issued additional emergency directives and the Texas Station Casino remained closed. However, the Texas Station Casino displayed a marquee which read, “STAY SAFE, WE’LL BE BACK!”, and its website displayed a pop-up window indicating that while the casino was “temporarily closed,” it “looked forward to opening soon.”

On May 28, 2020, the union filed a petition to represent a unit of employees at the employer. On July 2, the Regional Director directed a mail-ballot election, reasoning that although the petitioned-for employees were laid off, they had a reasonable expectation of recall. Among other things, the Regional Director cited the Texas Station Casino’s public statements (i.e., the marquee and representations of various supervisors in early March) to support his position.

The Board’s Decision

In an August 31 decision, the Board disagreed with the Regional Director’s reliance on “vague and hopeful” statements by Station Casinos and dismissed the petition. According to the Board, the employer had not indicated when (if ever) it would resume operations or recall employees, and laid-off employees could not reasonably rely on the representations of supervisors dating back to early March. Further, because the employer did not have any “past practice” relating to layoffs of employees amid a pandemic, it could not easily predict when it would be able to resume operations and recall employees.

Given that none of the petitioned-for employees had a reasonable expectation of recall, the Board determined that there were no eligible voters who could vote in an election held in the foreseeable future. The Board therefore dismissed the petition, but indicated that the Petitioner could refile if and when the Texas Station Casino resumes operations.

Implications

The Board’s decision here illustrates the Board’s attempt to navigate the unique circumstances presented by the COVID-19 pandemic. Board precedent is clear that workers who are temporarily laid off from their employment have a right to form a union and may even vote in an election. However, the Board’s decision in NP Texas LLC makes plain that workers affected by the COVID-19 pandemic, an uncertain and continuously evolving situation, need more than “vague and hopeful” statements by their employer in order to have a reasonable expectation of recall.

We will continue to keep you posted on the Board’s decisions related to the COVID-19 pandemic.

 

NLRB Division of Advice Dishes Some Guidance With Respect to COVID-Related ULP Charges

The pandemic has thrown a number of obstacles at employers and employees as everyone attempts to navigate a novel situation.  On August 13, 2020, the National Labor Relations Board (“NLRB”) Division of Advice (“Advice”), the agency’s internal think-tank, published five Advice Memoranda dismissing unfair labor practice charges against employers in connection with issues concerning the COVID-19 pandemic.  The Memoranda were all drafted by Advice within the past two months, expanding upon the guidance previously released on July 15.

Each Memoranda addresses a different COVID-related complaint concerning a variety of topics, such as employers’ responses to employees voicing concerns about workplace safety, allegations the employer engaged in discriminatory layoffs, and obligations to engage in midterm bargaining over COVID-related issues and provide information.

While some might characterize Advice’s dismissal of cases as giving employers more latitude, the results in the various Memoranda are consistent with existing Board case law.  Although not binding on disputes amongst other parties, the Memoranda are intended to give the public some idea of how the agency would handle similar types of issues and—although these cases are fact-dependent—the Memoranda are instructive when employers are considering their obligations under the National Labor Relations Act (“NLRA” or “Act”) during these turbulent and uncertain times.

Alleged Discriminatory Layoffs and Employer Response to Section 7 Activity during COVID-19: 

  • In Hornell Gardens, employees in a health care facility took various actions in response to the COVID-19 pandemic. One employee refused to share gowns, noting personal disgust and fear for that individual and his family’s safety. Another employee refused to work a scheduled shift due to concerns about COVID-19 exposure. Because of these actions, the employer threatened (in a statement in an online newsletter) to report the employees to the New York licensing authority for quitting without notice. Advice concluded that the employees’ conduct was not protected by Section 7 of the Act because the employees never spoke to management about their concerns nor did they contemplate or engage in group action, a requirement for the conduct to be deemed “protected, concerted activity” under Section 7 of the Act.  Advice also found that the employer’s statement about reporting the employees for abandoning their posts was not an unlawful “blackball” threat against future employment, but rather was a legitimate warning given the strict licensing requirements for patient care in the industry.
  • In Marek Brothers Drywall, Advice concluded that an employee of a Texas-based concrete company engaged in protected, concerted activity when the employee made comments relating to the lack of available resources to wash and sanitize as a precaution against COVID-19. Nonetheless, the record was insufficient to demonstrate employer knowledge or animus as it related to the employer’s decision to layoff the employee. Accordingly, Advice determined that dismissal did not violate Section 8(a)(1) of the Act.

Midterm Bargaining related to Union’s Proposals for Paid Sick Leave and Hazard Pay:

  • In Memphis Ready Mix, Advice concluded that the Employer did not violate Section 8(a)(5) of the Act by refusing to bargain over the Union’s midterm proposals regarding paid sick leave and hazard pay that were raised in light of COVID-19. In this case, the CBA (which remained in effect until at least September 30, 2020, and if not terminated, then year-to-year thereafter) already addressed leaves of absences and wages, and included a standard zipper clause, which Advice deemed “dispositive” because the clause provided that matters not covered by the CBA shall not be “subject to further collective bargaining” during the term of the agreement.

Duty to Furnish Information: 

  • In Crowne Plaza O’Hare, in connection with the employer’s shutdown of its hotel and initiation of staff layoffs, Advice concluded that the hotel did not violate the Act when it declined to provide information requested by the union concerning funding the employer sought under the CARES Act and other financial information, as well as documents between the company and clients to support the layoff decision. While the employer provided the union with partial responses (including charts showing the decrease in the hotel’s occupancy level), Advice concluded that the employer was not obligated to provide the detailed financial information the union sought because the employer did not cite to insufficient funds or lack of assets as the reason for the layoffs.  Rather, the hotel was temporarily closed due to COVID-19 “due to loss of business,” which was undisputed, and is an entrepreneurial decision for which no decisional bargaining obligation attaches.  Although employers are generally required to bargain over the “effects” of a decision such as this, when the layoffs are an “inevitable consequence” of the closure, then effects bargaining will not be fruitful and is not required.  Even if the employer had an effects bargaining obligation, the information requests were not relevant because the employer did not claim lack of assets resulted in the layoffs and closure.  The union’s failure to demonstrate relevance warranted dismissal of the charge.
  • In ABM Business, the union sought information relating to COVID-19 layoffs in connection with a pending grievance, such as communications between the company and clients supporting the decision to layoff and the company’s document retention policy. Advice dismissed the charge because the requests did not relate to employees’ terms and conditions of employment, and the union failed to articulate how the information was relevant.  Advice concluded that the union’s failure to provide a sufficient explanation as to why it needed the information and engage in the interactive process with the employer over the requests resulted in a complaint not being warranted.  Advice also found no merit to the charge that the employer failed to timely respond to the request for documents and information relied upon to make the layoff decisions.  The employer responded, and the union failed to engage with the employer about what was missing.

Takeaways

Advice’s recent Memoranda are instructive in evaluating how a Region may handle an unfair labor practice charge arising from labor-management relations during COVID-19.  Although the cases are fact-specific and highly-dependent on the text of the operative collective bargaining agreements, the Memoranda reinforce several principles.

First, employers and unions must refer to the governing CBA terms, when one is in effect, to evaluate the parties’ bargaining obligations—even during a pandemic.  Voluntary negotiations to address unforeseen consequences in a CBA as a result of the pandemic are of course permissible, and sometimes encouraged, but if agreement cannot be reached, then the parties are left with the existing bargain as codified in the CBA to deal with the present circumstances, and neither the employer nor the union is required to bargain over those subjects.

Second, each instance of employee concern expressed about workplace safety needs to be evaluated in context to determine whether the conduct is protected by Section 7 of the Act.  For instance, where the employee is not at all engaged in a group-effort, but instead is focused on the employee’s individual concerns, while other employment laws may come into play, the NLRA likely will not because the conduct is not “concerted activity.”  In addition, employees who abandon their post do so at their own peril, even due to safety concerns during a pandemic; existing CBA no-strike clauses and licensure requirements in the patient care field should be considered.

Finally, as always, concomitant with the duty to bargain is the duty to furnish information but as we have detailed many times, not every request creates an obligation to provide it under the Act.  Even when the employer has the right to make a decision unilaterally, as may be the case with layoffs if they are covered by a CBA or the result of a business shut down, the employer is typically required to engage in effects bargaining, which also entails the duty to respond to information requests.  When a request concerns financial information and information outside of bargaining unit employees’ terms and conditions of employment, however, the onus is on the requesting party to demonstrate relevance, unless relevance is “apparent” from the requests.  Advice’s determination that funding requests through outside loan sources, such as the CARES Act, and detailed financial information, are not relevant when the employer shut down its operation and laid off union staff due to lack of business because the employer did not trigger the relevance of the information sought by claiming “inability to pay.”

We will continue to monitor Advice’s guidance to the labor and management community, as well as Board cases on these important timely topics.

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