July 2012

On Friday, July 27, 2012, District Court Judge James Boasberg (D.D.C) denied the NLRB's motion to alter or amend his previous order which found the "ambush" election rules to be invalid because the Board lacked quorum. We previously covered this in more depth here. Judge Boasberg refused the invitation for "rehashing arguments" and continued to find the NLRB's arguments regarding Member Hayes' abstention to be unpersuasive. The Court's opinion can be found here.

In light of this decision, the NLRB cannot implement its proposed rules which would have dramatically altered the union recognition election process.  However, the Court did note that "nothing appears to prevent a properly constituted quorum of the Board from voting to adopt the rule if it has the desire to do so."  This issue could resurface depending on the future political make-up of the Board.

In a unanimous ruling handed down July 20, the Alaska Supreme Court recognized a “union-relations” privilege implied in the state’s Public Employee Relations Act, the statute governing representation rights of public employees. The Alaska Supreme Court is the first state supreme court to recognize such a privilege, which the Court found protected confidential employee communications with union representatives regarding anticipated or on-going disciplinary or grievance proceedings from forced disclosure.

The Alaska case, Peterson v. Alaska, Sp. Ct. No. S-14233 (July 20, 2012), involved a wrongful termination claim brought by an employee.  The defending state employer subpoenaed the former employee’s union representative and the union’s file regarding a grievance the employee filed challenging his termination.  The Court found that the file was protected from disclosure by the union-relations privilege, finding that “[a]s with attorney-client relationships, there is a strong interest in encouraging employees to communicate fully and frankly with their union representative.”

Notably, although the Court based the privilege on the rights granted by the state’s statute regulating public employee representation, it did not specifically limit the privilege to public employees.

Because it is likely that this decision will be used in other cases to argue that the privilege should be recognized by other states or in non-public union situations, readers of our blog should stay tuned. We will continue to follow developments in this area.

The full decision of the Alaska Supreme Court is available here.

Another Obama recess appointment to the NLRB is drawing Congressional scrutiny in recent days, in a continuation of the behind-the-scenes politicking between the Administration and certain Congressional members.  As we have reported previously, Republican Board Member Terrance Flynn resigned in May in the wake of allegations of inappropriate communications during his time as Chief Counsel for Board Member Brian Hayes.   Now Senator Orin Hatch, a prominent Utah Republican, has set his sights on Democratic Board Member Richard Griffin.  Prior to being appointed to the Board by President Obama in January, Mr. Griffin was General Counsel of the International Union of Operating Engineers. 

In a letter sent to Mr. Griffin on July 18, Senator Hatch raises questions about Mr. Griffin’s actions during his time as General Counsel for the union, specifically requesting information about his role in defending IUOE union officials accused of fraud and extortion, an area that he claims would have been investigated in detail at Mr. Griffin’s confirmation hearing in front of the Senate, if not for President Obama’s actions in appointing Mr. Griffin as a recess appointment.  It remains to be seen whether Member Griffin will actually respond to Senator Hatch’s questions.  But Senator Hatch’s letter illustrates that the Board is likely to continue to be closely scrutinized by Congress, especially as the election season progresses, and that the political “tit for tat” is likely to continue.

Senator Hatch’s letter to Mr. Griffin is available here (PDF).

The California Court of Appeals recently declined to follow the NLRB's ruling in D.R. Horton Inc. v. Michael Cuda, where the Board held that arbitration agreements containing class waivers may violate the National Labor Relations Act.

Nelsen v. Legacy Partners Residential, Inc., involved a putative class action alleging that Defendant Legacy Partners Residential violated state wage laws when it, among other things, failed to pay overtime, provide meal and rest breaks, and timely pay wages owed.  The trial court granted Defendant's request to compel arbitration based upon an arbitration agreement Plaintiff had entered into.

On appeal, Plaintiff argued, among other things, the enforcement of the arbitration clause to preclude class arbitration would violate California and federal law, and public policy in the employment field.  To that end, Plaintiff relied heavily on the Board’s decision in Horton. The Court, however, was not persuaded:

Since we are not bound by the decisions of lower federal courts on questions of federal law, it follows we are also not bound by federal administrative interpretations …  Although we may nonetheless consider the Horton decision for whatever persuasive value it has, several factors counsel caution in doing so. Only two Board members subscribed to it, and the subscribing members therefore lacked the benefit of dialogue with a full board or dissenting colleagues. The subject matter of the decision—the interplay of class action litigation, the FAA, and section 7 of the NLRA—falls well outside the Board‘s core expertise in collective bargaining and unfair labor practices. The Board‘s decision reflects a novel interpretation of section 7 and the FAA. It cites no prior legislative expression, or judicial or administrative precedent suggesting class action litigation constitutes a ―concerted activit[y] for the purpose of . . . other mutual aid or protection” … or that the policy of the FAA favoring arbitration must yield to the NLRA in the manner it proposes.

The Court ultimately held that enforcement of the arbitration provision, despite the preclusion of class arbitration, did not violate the law or public policy. The Court’s decision can be found here.

We have reported here in the past about the UAW's efforts to organize an automaker in the South. See:

“Mississippi Governor ‘Concerned’ About UAW Organizing in the Southeast”
“UAW Targets Nissan for Organizing Effort”

Now, in the latest move in their ongoing corporate campaign against Nissan, the UAW has turned to actor Danny Glover to help publicize their organizing efforts. The actor, known for his roles in the “Lethal Weapon” series and his community activism, appeared with UAW organizers in Canton, Mississippi. The full story can be found here.

Michigan has seen many changes in its laws regarding public employee unions since Republican Governor Rick Snyder took office in 2011.  As we previously noted, some of the controversial public labor legislation passed by Michigan’s Republican-controlled legislature in the last year includes a requirement that public union employees pay at least 20% of their health care costs, a ban on graduate student organizing, and a bar against payroll deductions for public school employee union dues – all bills that were signed by Snyder.

One on-going fight has been over the representation rights of home health care workers.  Many of these workers are self-employed but their wages come from government funds through programs like Medicare/Medicaid.  These payments are regulated by the Michigan Department of Community Health in conjunction with the federal Department of Human Services.  Until last year, the Department of Community Health also funded an entity called the Michigan Quality Community Care Council, which maintained a registry of home health care providers and provided training and other services.  In 2006, an organizing effort by SEIU resulted in a public employee union of these home health care workers, with the Michigan Quality Community Care Council identified as their employer.  SEIU collects dues from the members of the home health care union via payroll deduction from their government-provided wages.

Last year, in an effort to disband the union and curb what many saw as “forced unionization” of independent contractor home health care workers, the Michigan Legislature defunded the Michigan Quality Community Care Council.  When that didn’t work to stop the deduction of union dues from home health care workers’ paychecks, the Legislature passed a law excluding home health care workers and similar employees from the definition of “public employee,” effectively outlawing the established SEIU home health care union.  The law was challenged in court and a federal court judge issued a preliminary injunction in June allowing the union dues deductions to continue until the current contract expires in February 2013.

This week, Michigan Attorney General Bill Schuette stated that he plans to appeal the ruling to the Sixth Circuit.  Meanwhile, union supporters have been campaigning to get a proposal on the November ballot to amend the Michigan constitution to create a “Michigan Quality Home Care Council,” which would take the place of the Michigan Quality Community Care Council that was defunded.  The ballot proposal also reinstates the collective bargaining rights of home health care workers, providing that they shall have the same rights as public employees.  Supporters have turned in 550,000 signatures in support of the effort to get the proposal on the ballot in November.  Signatures will have to be verified by the Michigan Board of State Canvassers, but it appears that there will be enough to put the measure on the November ballot.

This issue is only one of many labor-related issues we expect to be relevant come November. Check back throughout the fall as we examine some of these issues in more detail.