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Labor & Collective Bargaining

Chapter Two: Lawsuits Filed Challenging NLRB’s New Election Rules

Seeking a declaratory judgment and injunction against enforcement of the National Labor Relations Board’s new “quickie” election rule, on January 13, 2015, the Associated Builders and Contractors of Texas, Inc., Associated Builders and Contractors, Inc., Central Texas Chapter, and National Federation of Independent Business/Texas filed a complaint against the NLRB in the United States District Court for the Western District of Texas.  The suit asserts the new rule violates the National Labor Relations Act, the Administrative Procedures Act, or both. Associated Builders and Contractors of Texas, Inc., et al. v. NLRB, Case No. 1:15-cv-00026.

A similar challenge was filed on January 5, 2015, by the U.S. Chamber of Commerce and certain associations in Washington, D.C. The Chamber’s suit alleges the rule violates the NLRA and the APA, as well as employers’ free speech and due process constitutional rights, among other things.

The NLRB’s so-called quickie election rule is designed to shorten the timeline for Board-conducted elections and to minimize pre-election litigation. The rule is set to take effect on April 14, 2015. Under the rule, NLRB Regional Directors are instructed to schedule elections “at the earliest date practicable” after a petition is filed. This may shorten the election timeline from the current 42 days to as little as 14 days. The rule also will impose substantial pressure on employers seeking to argue their position on the record, as now it must be expressed very early in the representation case process. Employers that do not prepare in advance will be at a real disadvantage in the event an election petition is filed by a union seeking to represent their employees.

In the latest lawsuit, the plaintiffs quote extensively from NLRB Members Johnson and Miscimarra’s dissenting opinions from the rule. The plaintiffs allege that “the new Rule makes sweeping changes and pre-election and post-election procedures that depart from the plain language and legislative history of the Act and exceed the Board’s statutory authority.” The lawsuit identifies the “evident purpose of the changes” – “to achieve the impermissible pro-union objective of accelerating the election process to such an extent that employers will be unable to respond effectively to union organizing campaigns.” It identifies 10 provisions of the rule that violate the NLRA or the APA, such as the improper shortening of the time between the filing of the petition and the first day of a hearing, the requirement that employers file a written and burdensome statement of position before exercising their statutory right to a pre-election hearing, and a bar to litigating and resolving before an election most disputes over individuals’ eligibility to vote (including their possible supervisory status) or the inclusion of certain employees or classifications in an appropriate unit.

Until the cases are resolved, employers should prepare as if the rule will go into effect as planned in April.

Michigan Excludes Student-Athletes from Unions

Michigan has become the first state to exclude intercollegiate student-athletes at its public universities from the definition of a “public employee,” and therefore, the right to bargain collectively through a union.

An amendment to Michigan’s Public Employee Relations Act signed by Governor Rick Snyder excludes from the definition of “public employee” (1) “a student participating in intercollegiate athletics on behalf of a [Michigan] public university”; (2) “a graduate student research assistant or [those serving] in an equivalent position”; and (3) “any individual whose position does to have sufficient indicia of an employer-employee relations using the 20-factor test announced by the [I]nternal [R]evenue [S]ervice.”

The action came in response to a decision by the Regional Director of the National Labor Relations Board in Chicago that the scholarship football players at Northwestern University were “employees” within the meaning of the National Labor Relations Act and therefore eligible to be represented by a labor union. (See NLRB Grants Review in Northwestern Case; Election to Be Held and Ballots Impounded.) The Northwestern decision is being reviewed by the five-member NLRB in Washington. A decision is expected at any time.

The state law has no applicability to student-athletes, graduate assistants and others attending private colleges and universities or to such individuals attending public universities in other states.

Preparing for Labor Board’s Quickie Election Rule

On December 12, 2014, the National Labor Relations Board issued the so-called Quickie Election rule, designed to shorten the timeline for NLRB elections and minimize pre-election litigation. The rule is set to take effect on April 14, 2015.

While the validity of the rule is expected to be challenged, union organizing efforts, which have languished for years, are certain to receive a boost from the Board’s action in the meantime. Employers unprepared for the rule will be at a disadvantage.

A Jackson Lewis webinar detailing the rule and preventive steps your organization may consider will be held on Tuesday, January 6 at 12:00 EST. Register for the webinar here.

For more information about Jackson Lewis’ recommended prevention plan, click here.

NLRB Announces New Standards for Exercising Jurisdiction Over Religiously-Affiliated Colleges and Universities and for Determining Whether Faculty are Managers Excluded from Collective Bargaining

In what is certain to be a controversial decision that could spark widespread organizing of faculty in private colleges and universities, the National Labor Relations Board adopted new standards for determining whether to exercise jurisdiction over self-identified religious colleges and universities under the U.S. Supreme Court’s decision in NLRB v. Catholic Bishop, 440 U.S. 490 (1979), and for determining the managerial status of faculty pursuant to the U.S. Supreme Court’s decision in NLRB v. Yeshiva University, 444 U.S. 672 (1980). Pacific Lutheran University, 361 NLRB No. 157 (Dec. 16, 2014).   For more information on this decision, please see our extensive article here.

Franchisor-Franchisee Relationship Focus of NLRB General Counsel

The National Labor Relations Board Office of the General Counsel has announced it has issued more than a dozen unfair labor practice complaints against McDonald’s franchisees and McDonald’s USA, LLC, as joint employers.  The complaints allege that McDonald’s USA, LLC and certain franchisees violated the rights of employees working at McDonald’s restaurants at various locations around the country.

The General Counsel’s action heightens anticipation for the Board’s decision in Browning-Ferris, in which the NLRB is expected to change the existing standard for a finding of joint employer.  We will monitor and report developments.

Board Adopts Presumption That Employees Can Use Employer’s Email System to Engage in Protected Activity

In a controversial but not unexpected decision, reversing precedent, a majority of the National Labor Relations Board held that absent special circumstances that justify specific restrictions employers must permit employees who have been provided access to their employer’s email system to use email for statutorily protected communications on their nonworking time  Purple Communications, Inc., 361 NLRB No. 126 (December 11, 2014). The decision applies retroactively.

Facts

The Respondent, Purple Communications, provides sign-language interpretation services. Its employees provide two-way, real time interpretation of telephone communications between deaf or hard-of-hearing individuals and hearing individuals. The interpreters work at 16 call centers and all are assigned and use on a daily basis individual email accounts on Respondent’s system. Employees can access their email accounts at their workstations, in break areas, and on their personal computers and smart phones.

In the fall of 2012, the Union (Communication Workers of America) filed a petition to represent the interpreters, which resulted in Board elections at seven of Respondent’s call centers. The Union filed objections to some of the results and challenged Respondent’s electronic communications policy, which strictly prohibited employees from using the computer, internet, voicemail and email systems, and other Company equipment to engage “in activities on behalf of organizations or persons with no professional or business affiliation with the Company,” and to send “uninvited email of a personal nature.”  According to the Union, the policy interfered with the interpreters’ freedom of choice in two of the elections. The Union also filed an unfair labor practice regarding the policy, which led to the issuance of a complaint and the case at issue.

The NLRB administrative law judge, findingthat Respondent’s electronic communications policy was lawful under the Board’s decision in Register Guard, 351 NLRB 1110 (2007), dismissed the complaint, and overruled the Union’s related election objections. The Board’s Register Guard decision provides that employers may completely prohibit employees from using the employer’s email system for Section 7 purposes, even if employees are otherwise given access to the system, without any obligation to demonstrate any business justification as long as the employer’s ban is not applied in a discriminatory manner.  After both parties filed exceptions to the ALJ’s decision, the Board issued a notice and invitation to the parties and interested amici curiae to file a brief on several questions including whether the Board should reconsider its conclusion in Register Guard and what standard should apply if the Board overruled Register Guard.  

Register Guard Overruled

In Purple Communications, the Board overruled Register Guard and set forth a new rule – a presumption that employees who have been provided access to the employer’s email system are entitled to use the system to engage in statutorily protected discussions about their terms and conditions of employment during nonworking time, absent a showing by the employer of special circumstances that justify specific restrictions. To demonstrate special circumstances, an employer must articulate the specific business interest at issue and show how the interest supports a restriction on email usage during nonworking time.

According to the Board majority, the analysis in Register Guard focused too much on employer property rights and too little on the importance of email as a means of workplace communication, did not adequately protect employees’ Section 7 rights under the Act, and failed to “adapt the Act to the changing patterns of industrial life.”

The majority found the Register Guard Board’s reliance on the notion that email systems are equivalent to other communications-related equipment (such as bulletin boards, copy machines, public address systems, and telephones) which an employer can limit use of for work purposes misplaced.  Given the prevalence of email communication in the workplace, this analysis placed too much emphasis on equipment and not enough on an employee’s right to communicate regarding self-organization at the jobsite.  Electronic communication is effectively a new “natural gathering place” and a forum in which coworkers who share “common interests” will “seek to persuade fellow workers in matters affecting their union organizational life and other matters related to their status as employees.” Accordingly, the Board found a significant difference between an employer-owned email system and an employer’s bricks and mortar facility making the Register Guard Board’s analogy to employer-owned  equipment and emphasis on employer property rights misplaced.

The Board also reasoned that email communication is not a solicitation or a distribution per se. Rather, an email system is merely a forum for communication and the content of the email may constitute a solicitation, distribution, or neither a solicitation nor distribution, but communication that is still protected by the Act.  Thus, email systems cannot be characterized as a work or non-work area, but should be considered as mixed-use areas in which work-area restrictions on literature distribution will generally not apply. Thus, the Board ultimately concluded that the Register Guard analysis was not appropriate and should be overruled to ensure the Board adapts the “Act to the changing patterns of industrial life.”

The Board noted that its decision in Purple Communications is carefully limited and seeks to accommodate employees’ Section 7 rights to communicate and the legitimate interests of their employers.  First, the Board noted that the decision applies only to employees who have already been granted access to the employer’s email system in the course of their work and does not require employers to provide such access.  Second, an employer may justify a total ban on non-work use of email, including Section 7 use on nonworking time, by demonstrating that special circumstances make the ban necessary to maintain production or discipline.  The Board noted, however, that “it will be the rare case where special circumstances justify a total ban on non-work email use by employees.” Further, where special circumstances do not justify a total ban, employers may still apply uniform and consistently enforced controls when necessary to maintain production and discipline. Third, the decision does not address email access by nonemployees, nor does it apply to any other type of electronic communication systems.

Dissents

Member Miscimarra dissented from the decision on the grounds the Board should avoid disrupting long standing precedent and strive to accommodate any conflict between employer property rights and employee rights to engage in protected activity.  The presumption established in Purple Communications fails to accomplish those goals.  Furthermore, the dissent stated that the majority decision presumes that limiting email system use constitutes an impediment to self-organization, fails to accommodate an employer’s property rights associated with its computer resources, adversely affects other legal requirements imposed by the Act, and replaces an easily understood rule with a presumption unless unspecified “special circumstances” exist.

Member Johnson also dissented from the decision, in part, based on his view that email is different than physical space and the majority decision undermines an employer’s right to own and operate an email network for business purposes. Unlike physical space, email communication is unlimited, can be directed to large audiences regardless of the wishes of some or all of the audience, cannot be separated in terms of working or non-working areas, and is impossible to exit if working on the system.  Conversations taking place at the water cooler or in person do not persist beyond the conversations themselves.  Email conversations, on the other hand, are a double edged sword in relation to productivity because there are no definite bounds in space, time, or audience which necessarily costs employers money and distracts from the employer’s business.

Employer Actions

In response to this decision, all employers must review their electronic communications, bring your own device (BYOD) and social media policies and practices relating to employee usage, notably where there is a complete ban on personal use.  Policies promulgated pursuant to Register Guard which prohibited all personal e-mail usage or personal email usage for Section 7 purposes or email usage during non-working time must be modified.  Note that an unlawful policy, even if not enforced, can result in the overturning of an election.  Further, while employers still should reserve the right to monitor email usage, before exercising such right, employers must consider potential NLRB charges based on surveillance if there is known union activity and must be wary of disciplinary actions commencing shortly after learning of union activity through monitoring.  Of course, this policy review cannot be accomplished in a vacuum and also should include non-NLRA related considerations such as the impact of allowing email on non-working time on potential wage and hour claims and privacy issues, including the monitoring the activity itself and use of these communications for disciplinary or litigation purposes.

NLRB Issues Final “Quickie” Election Rule

The National Labor Relations Board has adopted a final rule amending its representation–case procedures. The rule will be published in the Federal Register on December 15, and will take effect on April 14, 2015. The final rule was approved by Board Chairman Mark Gaston Pearce and Members Kent Y. Hirozawa and Nancy Schiffer. Board Members Philip A. Miscimarra and Harry I. Johnson III dissented.

Chairman Pearce said of the new rule, “I am heartened that the Board has chosen to enact amendments that will modernize the representation case process and fulfill the promise of the National Labor Relations Act. Simplifying and streamlining the process will result in improvements for all parties. With these changes, the Board strives to ensure that its representation process remains a model of fairness and efficiency for all.”

The final rule likely is identical to the proposed rule which was published in the Federal Register on February 6, 2014 and discussed here.  A detailed analysis of the final rule and its implications will be forthcoming.

NLRB Requires Employers to Let Employees Use Workplace Email Systems for Union and Concerted Activities, Overruling 2007 Decision

In a landmark and not-unexpected ruling, the National Labor Relations Board decided today to require employers to allow their employees to use company email systems for Section 7 (union organizing and protected concerted activity) purposes during nonworking time.  Purple Communications, Inc., 361 NLRB No. 126 (Dec. 11, 2014). The decision overrules the Board’s 2007 Register Guard decision (351 NLRB 1110), in which the NLRB held employers had the right to ban all employee personal use of employer email systems.

The latest ruling does not require employers to grant email access to employees who had not previously been given access. The ruling also allows employers to prove that special circumstances exist for a total ban on such access to maintain production and discipline.

A detailed analysis of the decision and its implications will be forthcoming.

Senate Confirms Lauren McFerran as Member of National Labor Relations Board

On December 8, the Senate confirmed Lauren McFerran (D) as a member of the National Labor Relations Board by a vote of 54-40, along party lines. Ms.  McFerran will replace Democrat Nancy Schiffer, whose appointment is set to expire December 16, 2014.  Employers should expect that her views will be similar to Member Schiffer’s pro-labor stance. Ms. McFerran’s appointment to the NLRB ensures the Board will retain its 3-2 Democratic majority after the Republicans take control of the Congress in 2015.

Ms. McFerran has been the Chief Counsel for the Senate Committee on Health, Education, Labor and Pensions since 2010.  Prior to that, she was Senior Labor Counsel for Senator Tom Harkin (D-IA) and Senator Ted Kennedy (D-MA).  Ms. McFerran also was an Associate at a Washington, D.C., law firm specializing in the representation of public and private sector labor organizations and related institutions.

Substantial Doubt Cast on Imminence of “Quickie” Election Rule

Despite widespread expectations that the National Labor Relations Board would issue its final revised “quickie” election rules prior to the expiration of NLRB Member Nancy Schiffer’s term on December 16, 2014 (to avoid being frustrated by a 2-2 Republican-Democrat split after her departure), recent events suggest the Board might not be so eager to issue the final rule.  (See our previous post, What the November Election May Mean to the “Quickie” Election Rule, for more information.)

First, the Obama Administration withdrew its controversial nomination of Sharon Block to replace Member Schiffer, substituting Lauren McFerran (a Democrat), currently chief labor counsel for the Senate Health, Education, Labor and Pensions Committee.  The Senate promptly held a hearing on Ms. McFerran’s nomination, which by all accounts was cordial.  Committee approval (by the very Committee that presently employs Ms. McFerran) just occurred, so it is likely that full Senate confirmation will come before the current Congressional term ends (on or about December 9th).  Thus, concerns about a looming Board impasse have been alleviated.

Second, the latest Regulatory Information Service Center (RISC) semi-annual Unified Agenda of federal agency actions states the probable issuance of the long-awaited NLRB final election rule is “To Be Determined.”

The RISC Unified Agenda manual directs agencies to divulge scheduled or “projected” dates of regulatory actions by at least the month and year.  Where the agency has indicated “no estimated future date” for a particular action, the Agenda will read “To Be Determined.”

How is the public to interpret “To Be Determined”?  Is issuance imminent or to be delayed?  Is the final rule fully drafted (as many have said) or is it still being revised?  Will it be issued at all?

Essentially, we have another round of Washington tea-leaf reading.

The practical imperative (avoidance of an ideological standoff on the Board) for immediate issuance of the final rule has receded.  However, many believe the rule will be published in the next few weeks.  One could argue that the Board’s ambiguous statement as to timing suggests it may be hedging its bets politically, concerned about Congressional reprisals.  It is hard to tell.  High-ranking Republicans have hinted that the incoming Congress may exercise its power of the purse to prevent NLRB application of the new rule.  It may be that the longer the Board goes without issuing the new rule, the less likely it will issue at all.

Credible arguments exist to support all eventualities. Keep reading your Labor & Collective Bargaining blog for the latest news.