December 2011

Here’s the conclusion to our countdown of the top ten traditional labor issues that made the news this year. Our top five are below; see numbers 6-10 in our post yesterday.

5. The Board mandates employee-rights posters, but lawsuits delay implementation

In a move that will affect virtually all private employers, whether unionized or not, the Board approved a final rule in August which requires employers to notify employees of their rights under the NLRA via an 11 x 17 inch poster. A copy of the required poster, along with more information about the posting requirement is available on the Board’s website.   

This posting requirement elicited strong opposition from many business groups, including the National Association of Manufacturers, the National Federation of Independent Businesses, and the U.S. Chamber of Commerce, who have all filed lawsuits against the Board challenging the posting requirement. In response to these suits, the Board has delayed implementation of the rule, most recently postponing the effective date of the posting requirement until April 30, 2012. 

So for now, employers can leave the NLRB poster off their walls, but all employers should stay informed on this issue as the implementation date approaches. 

See our previous coverage of this issue here.

4. Social media becomes a new battleground

Facebook came to traditional labor this year, as the Board put a new emphasis on social media as a form of protected activity. Several complaints were filed against employers during the early part of the year alleging unfair labor practices, after the employers disciplined or terminated employees for posts related to their jobs on their personal Facebook and other social media accounts. In August, General Counsel Solomon issued a report summarizing the cases and detailing the Board’s position on appropriate social media policies.

These actions by the Board caution employers to be wary of protected speech rights under the NLRA before taking action against employees for off-duty Facebook chatter and to also make certain that company policies on social media do not chill or limit discussion regarding working conditions. Recent General Counsel decisions have also brought up the issue of potential surveillance violations if employers monitor employees’ off-duty social media use. 

This continues to be a hot issue, and as we move into the new year, employers should stay cautious when it comes to social media.

See our previous coverage of this issue:

- New Facebook Cases - No Protected Concerted Activity, But Is It Surveillance??

- Update on Social Media issues with the NLRB

-  Labor & Employment Law Alert - NLRB Sues Non-Union Employer Over Facebook Firing

3. NLRB complaint against Boeing for alleged unlawful transfer of work creates national controversy

By far the traditional labor story that created the most national headlines this year was the Board’s complaint filed against Boeing in April alleging unlawful transfer of work over Boeing’s decision to open a new 787 Dreamliner assembly plant in South Carolina instead of building the new planes at Boeing’s facilities in Washington.  The key controversy wasn’t really the Board’s allegation of unlawful transfer of work, but its proposed remedy – shut down the brand new billion-dollar South Carolina plant and move the work to Washington.  Unsurprisingly, this suggestion turned some heads in the business world.  Accusations of job-killing by the NLRB soon followed, as well as legislation introduced in Congress to prevent the NLRB from mandating such a remedy. 

Boeing litigated the issue for much of the year, but ultimately agreed in December to settle the case as part of a new contract with the Machinists union for its Washington facility.  The union agreed to keep production of the Dreamliner in South Carolina in exchange for a promise by Boeing to build its new 737 MAX aircraft in Washington.  This agreement officially ended the saga for Boeing, as the Machinists union withdrew its charge.  As for the Board, it remains to be seen whether negative fallout, if any, from its decision to issue the complaint will affect its public perception in the future. 

See our previous coverage of this issue:

- Labor & Employment Law Alert - NLRB Seeks Unprecedented Order Requiring Boeing to Move its New Production Line Across the Country

- An active day at the NLRB

- Boeing and the Union Reach a Tentative Agreement to End Contentious Battle Over Cross-Country Relocation

2. Board implements “quickie election” rules despite strong criticism from dissenting Member Brian Hayes

While it took all year, the Board succeeded last week in finalizing what critics have dubbed its “quickie election” rules.  The new rules eliminate avenues for employers to challenge union activity prior to an election and also shorten time periods during which employers can campaign against unionization.  The rules had been proposed by the Board in June and generated significant criticism from business groups who found the rules blatantly pro-union and accused the Board of denying employers their rights to free speech.

Also highly critical of the proposed rules was the sole Republican member of the Board, Brian Hayes, who said he considered resigning prior to the Board’s meeting to vote on the rules just to prevent them from being implemented.  Member Hayes did not resign, but instead argued for more time to consider the rules, a request that was denied by his fellow Board members.  The Board voted 2-1 in November to finalize the rules and the final version was published in the federal register last week.   

As we move into 2012, this may not be the end of the issue, however.  The rules should take effect in April, but a lawsuit filed by the U.S. Chamber of Commerce challenging the new rules may change this. Stay tuned.  

See our previous coverage of this issue:

- Labor & Employment Law Alert - NLRB Election Changes Are Here (BT Alert)

- After A Long Wait, the NLRB Has Finalized the "Quickie Election" Rules

-  An active day at the NLRB  

-  NLRB releases update on “quickie election” vote scheduled tomorrow

- Strategic resignation by Member Hayes may derail scheduled Board vote on “quickie election” rules

1. Behind-the-scenes politics leave an uncertain future for the NLRB

As our list so far has illustrated, 2011 was an active year for the National Labor Relations Board, with several controversial decisions, new administrative rules, and Congressional scrutiny. But all of these issues that we’ve included in our list are really just a byproduct of a more aggressive, and some would say politically motivated, Board. And the composition of the Board, which has driven most of the change we’ve seen this year, not only heads our list for 2011, but provides a starting point for looking into the 2012 crystal ball.

2011 saw an increased politicization of the Board, with a contentious division between the Board’s Democratic and Republican members. Sole Republican member Brian Hayes even went so far as to threaten resignation in November over what he saw as the Board’s unwillingness to take the time to consider the full effects of its controversial “quickie election” rules prior to drafting a final version of the rules. The Board also made the controversial decision to publish those rules without allowing the customary time for dissenting members (in this case, Hayes) to prepare and publish a dissent. 

All of this behind-the-scenes politics has played out in the shadow of the looming expiration of Member Craig Becker’s appointment to the Board. President Obama appointed Becker as a recess appointment in 2010, which means that his term expires on December 31. Once his term expires, the Board (which is intended to have five members) will be left with only two remaining members. This loss of quorum will prevent the Board from issuing any new decisions or rules until a third member is appointed, under the U.S. Supreme Court’s New Process Steel decision. 

President Obama has attempted to prevent this from happening by recently naming two additional nominees for Board member positions, both Democrats.  (The President also nominated Republican Terence Flynn to the Board last January, but his nomination has not yet been considered by the Senate.)  However, the Senate so far has refused to hold a vote on any of the nominees and additionally appears to be avoiding declaring a formal recess so that the President cannot name a recess appointment as he did with Becker. 

This collection of events is set to leave the National Labor Relations Board effectively useless come midnight Saturday. As we ring in the new year, the Board may be closing up shop. Stay tuned to BT Labor Relations as we see what 2012 brings.

Disagree with our picks?  Let us know in the comments what traditional labor issues you think were most important in 2011.

Reuters is reporting today that the UAW has settled on U.S. plants owned by Volkswagen and Daimler AG as organizing targets, in part because they are “seen as easier nuts to crack than the Japanese and South Koreans.”

The entire article can be seen here. 

‘Tis the season for year-end recaps, and we here at BT Labor Relations couldn’t resist taking our own look back at the year in traditional labor. As we move into 2012, here’s our countdown of the top ten traditional labor issues that made the news this year. Numbers 10 through 6 are below, and an article highlighting our top-5 can be accessed by clicking here. 

10. The Board sues Arizona over secret ballot constitutional amendment

2011 started off with a bang in January when the Board’s Acting General Counsel Lafe Solomon threatened to sue four states (Arizona, South Carolina, South Dakota, and Utah) over their secret ballot union election constitutional amendments.  All four states added provisions to their state constitutions mandating that union elections be held by secret ballot only, after constitutional amendments passed by public referendum at the November 2010 election.  These constitutional amendments were in response to the Employee Free Choice Act (EFCA) proposed in Congress in 2009, which would have required an employer to recognize a union if a majority of employees signed cards stating their desire for representation.  This “card check” method of recognition is currently allowed by the NLRA, but employers have the option of demanding that election of the union be confirmed by a secret ballot.  EFCA would have taken this option away from employers (as well as enacting other pro-union changes to the NLRA). 

EFCA never became law, but the constitutional amendments in these states passed anyway, purportedly preserving the right of a secret ballot election for employers in those states.  The amendments as they currently stand do not conflict with the NLRA, but the NLRB nevertheless took exception to them, claiming that such state provisions are preempted by federal law.  After a back and forth discussion with the states’ Attorneys General during the early part of 2011, the NLRB filed suit against Arizona in May, asking the court to declare that Arizona’s constitutional amendment was preempted by federal law and therefore unenforceable. 

Although EFCA never became law, the NLRB has made attempts to individually implement many of the pro-union changes proposed in the bill, and Arizona has become the battleground for card checks.  So far, the NLRB’s lawsuit appears to have some traction.  The Arizona federal court hearing the case has denied Arizona’s motion to dismiss and litigation continues.  Stay tuned in 2012 as this issue continues to develop …

See B&T’s previous coverage of this issue here.

9. The NLRB strikes a blow to mandatory arbitration policies in Supply Technologies

Companies love mandatory arbitration policies in contracts and in May, the U.S. Supreme Court issued a landmark decision in AT&T v. Concepcion upholding such policies in consumer contracts.  Employers also see the appeal of mandatory arbitration clauses and many union contracts include such provisions.  However, an NLRB Administrative Law Judge reminded employers of the limits of such policies in a decision in June, finding in Supply Technologies LLC that an employer’s arbitration policy violated the NLRA by unlawfully restricting employees’ rights by suggesting that an employee had to bring any unfair labor practice charge through the arbitration procedure, and thus could not make that charge with the Board. This decision served as a warning for employers hopeful after the Concepcion decision that arbitration provisions should be carefully reviewed before being included in collective bargaining agreements.  Employers should know that just because SCOTUS approves, doesn’t mean the Board will.

See B&T’s previous coverage of this issue here.

8. Congress sits up and takes notice (although no new legislation is actually passed)

With a new majority in the House of Representatives after the 2010 elections, certain Republican members of Congress have made the NLRB their new target this year. Several hearings were held by Congressional Committees to discuss what many characterize as the pro-union, “activist agenda of the National Labor Relations Board.”  The Board’s complaint against Boeing was a frequent target, as well as its decisions regarding posting requirements, “quickie” elections, and “micro” bargaining units.  

Additionally, Republicans in both the House and the Senate have introduced bills to amend the NLRA to reverse these controversial actions taken by the NLRB in 2011.  The Democrats weren’t able to get EFCA passed when they had a majority of both houses, so it is unlikely that any of this legislation will actually be passed by a divided Congress, but the NLRB’s continued perceived pro-union actions have made traditional labor a key issue as we move into the 2012 election season. 

See B&T’s previous coverage of this issue here.

7. General Counsel memo regarding mandatory language in settlement agreements puts additional pressure on employers

This year, the Board has placed additional pressure on employers looking to settle NLRB proceedings with the issuance of a memo by General Counsel Solomon in January which requires mandatory language in settlement agreements whereby an employer in effect agrees in advance that if it is even accused of violating the agreement, all of the prior charges against it have merit.  Although the Board characterized this language as necessary for effective enforcement of such agreements, this requirement likely has the effect of simply making employers less willing to settle a case.  And it was another example of the Board’s aggressive efforts to secure rights for unions in 2011.

See B&T’s previous coverage of this issue here.

6. Specialty Healthcare decision opens the door for “micro” bargaining units

One of the Board’s more controversial decisions of 2011 was issued in August regarding appropriate bargaining units.  In Specialty Healthcare (357 NLRB No. 83), the Board overturned 20 years of precedent regarding determination of an appropriate bargaining unit in non-acute health care facilities. The Board increased the burden on employers who wish to challenge a bargaining unit petitioned for by a union to include more employees.  Under the new standard, employers have the burden to prove that the employees the employer believes also should be part of the unit share an “overwhelming community interest” with the petitioned for employees.  The previous rule (as articulated by the Board in Park Manor Care Center, 305 NLRB 872 (1991)), applied a lower standard:  whether the community of interest of the employees the employer sought to include was “sufficiently distinct from those of other employees” in order to justify their exclusion from the bargaining unit. 

The upshot is that this decision allows unions to pursue so-called “micro” bargaining units, and it will be easier for unions to certify bargaining unit(s) piecemeal, even when a majority of employees in a facility do not desire union representation.  This decision helps unions trying to “get a foot in the door” by allowing them to target vulnerable employer sub-groups. 

This decision was targeted by legislation introduced in Congress to reverse it, but for now, it remains current Board law and sets up new challenges for employers seeking to avoid unionization.

See B&T’s previous coverage of this issue here.

Disagree with our picks?  Let us know in the comments what traditional labor issues you think were most important in 2011.  And don’t forget to check back tomorrow for our top five!

The National Labor Relations Board's weekly summary of decisions for last week, December 19-23, 2011, is now available on the Board's website.

The NLRB announced today that it will postpone, until April 30, 2012, the deadline for employers to post a notice outlining employee rights to organize under the National Labor Relations Act. More information is available here. The NLRB agreed to the deadline postponement at the request of the federal judge who is hearing the case challenging the Board's right to create such a posting requirement.

Facebook cases continue to be examined by the NLRB as a new technology cloaked in traditional case law.  The NLRB's General Counsel has recently decided to dismiss three complaints brought by terminated employees who were fired for their Facebook posts.  In all three cases, the GC found the conduct not to be protected concerted activity under Section 7 of the NLRA.  That approach is consistent with the GC's memo earlier this year which emphasized that content and context were key in analyzing whether disciplinary action brought as a result of social media chatter violated the NLRA.  A recent blog post on the topic appears here. To access the GC's office memoranda on these cases, click here.  All three continue to show the NLRB's focus on whether the Facebook chatter is merely an expression of individual gripes or is the chatter an effort to initiate group dialogue or group action.  Employers must continue to evaluate decisions to discipline for social media postings within that context.

However, buried in one of the opinions, Intermountain Specialized Abuse Treatment Center, is a provocative and concerning analysis by the GC's office regarding union surveillance.  The Advice Memorandum concludes that it agrees with the Regional Director that the Employer did not unlawfully create the impression that it was engaged in surveillance of protected union activity by having knowledge of the Facebook post.  What??  The memorandum states that employer surveillance or creation of an impression of surveillance constitutes unlawful interference with Section 7 rights.  Here, there was no such impression of surveillance because the employer received the Facebook information from another employee and the conduct at issue turned out not to be protected activity.  However, the memorandum certainly raises the question of whether an employer practice to examine Facebook posts on a regular or even on an as needed basis would violate Section 7 rights.  The jury is still out on that issue.  Stay tuned.

The NLRB has finalized the amendments to its quickie election rules and will publish these rules in Thursday's Federal Register. The new rules eliminate avenues for employers to challenge union activity prior to an election and also shorten time periods during which employers can campaign against unionization. This departure from the historical norm comes just days before controversial Democratic Board Member Craig Becker's term is set to expire. Without Becker, the Board will be reduced to two members and will be unable to act.

Barnes & Thornburg has obtained an advance copy of the new rules which can be found here.The Board has also posted a short, technical summary on its website which can be found here. 

In response, the National Chamber Litigation Center and the Coalition for a Democratic Workplace filed a lawsuit Tuesday evening in the Federal District Court for the District of Columbia challenging the new rules. A copy of that complaint can be found here.

The new rules become effective on April 30, 2012.

UPDATE: Barnes & Thornburg issued a legal Alert that outlines the various changes to the NLRB's election rules. You can read the entire Alert by simply clicking here.  

This week the Ninth Circuit Court of Appeals took a step towards undoing a controversial recent Board decision when it found that the Board erred in analyzing whether an employee lost the protection of the Act during a profanity-laced tirade against the company owner.

This case involves a car salesman who was terminated just months after his hire.  During that brief tenure, the employee complained about meal and restroom breaks, commissions, salary, and the owner's refusal to disclose the direct dealer costs of the vehicles.  In response, the owner invited the employee to work elsewhere and ultimately called the employee into his office to discuss his attitude.  During that meeting, the employee became irate and called the owner several inappropriate names, including an “f---ing crook” and an “a—hole.” Just before pushing his chair aside and telling the owner that he would regret firing him, the employee added that no one liked the owner and the employees talked behind his back.  Not surprisingly, the employee was terminated.

Following his termination, the employee filed an unfair labor practice with the NLRB.  The ALJ found that the employee had engaged in protected activity under the Act through his wage and working condition complaints, however surrendered that protection due to the obscene remarks and personal attacks against the owner.  Upon review, the Board disagreed and held that the employee did not forfeit the protections of the Act just because he launched into obscenities (and hinted that threats were needed to lose protection of the Act).  On appeal, the Ninth Circuit found that the Board erred in its analysis of the actual outburst.  Specifically, the Court indicated a weariness to allow such outlandish insubordination to be protected by the Act and instructed the Board to review the evidence to determine if the employee's behavior was menacing or "at least physically aggressive" when reaching its ultimate decision regarding protection under the Act.

The Ninth Circuit's decision can be found here.

On Feb. 9, 2012, the Los Angeles County Bar Association will hold its bi-annual Entertainment Labor Law Symposium. Barnes & Thornburg Partner, Scott J. Witlin, is scheduled to speak at the event. The topic of Scott's presentation is entitled, “New Media's Impact on Production, Residuals, and How Cast and Crew are Engaged.”

Other sessions slated to take place during the event include: “Social Media in the Entertainment Workplace,” “The State of the Plans: Dealing with the Economy and Health Care Reform,” and “Anti-Trust Issues in the Labor-Entertainment Arena.” 

For registration and other information please see the Los Angeles County Bar Association’s website or click here.

Union elections in the airline and rail industries just got a bit easier for Unions. 

The U.S. Circuit of Appeals for the D.C. Circuit in a 2-1 decision upheld a decision by the National Mediation Board (NMB) to change the majority of votes rule in representation elections. Since 1934, members of the proposed bargaining units were counted as “no” votes if they decided not to vote in the election. But the NMB decided earlier last year that the rule should be a majority of the votes actually cast instead of a majority of the eligible voters.

On Friday, Dec. 16, 2011, the D.C. Circuit, in a case entitled Air Transport Association v. NMB, decided that the rule change was not an arbitrary and capricious change. In fact, the court determined, since the statute was silent on the issue, it suggests deference to the agency in deciding how votes were to be counted.

“As the district court observed, nothing in the [Railway Labor Act] clearly and unambiguously requires that a majority must participate in order to have a valid election,” the opinion said. “The fact that a majority of eligible voters decides to abstain — i.e., not exercise its right — hardly suggests that the majority was deprived of its right. This is how voting rights work.”

You can access the decision online by clicking here.