In a 3-1 decision, the National Labor Relations Board found that a Las Vegas casino violated Section 8(a)(1) of the National Labor Relations Act by prohibiting off-duty employees of a lessee restaurant from distributing handbills to restaurant patrons on the lessor casino’s premises.  The case, New York New York, LLC, 356 NLRB No. 119, was remanded to the Board from the United States Court of Appeals for the District of Columbia Circuit to consider whether the contractor’s employees should be treated as employees of the casino or as nonemployee union organizers. 

In 1997, the handbillers, employees of Ark Las Vegas Restaurant Corporation (“Ark”), distributed handbills outside Ark’s restaurant on New York New York Hotel & Casino (“the Casino”) property.   The purpose of the handbilling was to garner public support for their organizing efforts as Ark employees.  They were located at three access points: the casino’s porte-cochere (“the covered sidewalk and driveway just outside the Casino’s main entrance”) and outside of two Ark-operated restaurants inside the casino. 

Under existing precedent, the Board determined whether to treat Ark’s employees as employees of the Casino — which would have allowed the them full access rights under the Supreme Court’s decision in Republican Aviation Corp. v. NLRB, 324 U.S. 793 (1945) – or view them as nonemployee union organizers – requiring the Board to apply the Supreme Court’s more restrictive access test in the Supreme Court’s Lechmere, Inc. v. NLRB, 502 U.S. 527 (1992) decision.

In its decision, the Board said it was addressing only the “narrow” situation where “a property owner seeks to exclude, from nonworking areas open to the public, the off-duty employees of a contractor who are regularly employed on the property in work integral to the owner’s business, who seek to engage in organizational handbilling directed at potential customers of the employer and the property owner.” 

The Board held that a property owner may prohibit off-duty employees of a subcontractor from engaging in handbilling to customers only where (i) it can demonstrate that activity of the subcontractor’s employees “significantly interferes” with the owner’s use of the property; or (ii) there is another legitimate business reason to justify the exclusion.  “The need to maintain production and discipline” (as defined by the Board’s case law) are “legitimate business reasons.”  The Board explained of its ruling:  

“[A]ny justification for exclusion that would be available to an employer of the employees who sought to engage in Section 7 activity on the employer’s property would also potentially be available to the nonemployer property owner, as would any justification derived from the property owner’s interests in the efficient and productive use of the property. . . .  We leave open the possibility that in some instances property owners will be able to demonstrate that they have a legitimate interest in imposing reasonable, non-discriminatory, narrowly-tailored restrictions on the access of contractors’ off-duty employees, greater than those lawfully imposed on its own employees. “

Board Member Brian Hayes dissented from the majority’s decision to allow handbilling inside the Casino’s property, but still found the Casino violated the law by excluding the handbillers from the porte-cochere area outside the main entrance of the Casino.  He found the majority’s decision afforded “as much, if not more, protection to the efforts of Ark employees to engage in union organizational activity on the [Casino’s] premises as the [Casino’s] own employees would have.”  Of particular note, Hayes believed the employees should be required to show that they had no other reasonable way to communicate with their fellow employees or the customers of the restaurant inside the Casino.  The majority did not require that showing. 

People will agree or disagree with this decision.  As General Counsel at the time this case was briefed on remand from the District of Columbia Circuit, I took a position closer to the dissent, believing that other reasonable means of access should be a consideration, if not a controlling one, in determining the access rights of the Ark employees.  That said, whatever view one takes of the outcome, I believe the erudition and thoughtfulness of both the majority and the dissent is a tribute to the Board as a whole, and its efforts to forthrightly resolve a difficult issue posing an honest policy difference.