NLRB Requires Employer to Bargain with Union over Unilateral Use of Temp Agency Employees and E-Verify

An Administrative Law Judge of the National Labor Relations Board recently ruled that a meat processing company had violated provisions of the National Labor Relations Act when it utilized a temporary employment agency to fill vacant bargaining unit positions, and enrolled in the E-Verify program without first adequately notifying or bargaining with the local union. The Ruprecht Co., Nos. 13-CA-155048, 13-CA-155049, 13-CA-156198 and 13-CA-158317, JD(NY)-14-16 (May 13, 2016).  For more about this decision, please click here.

By Amy Peck and Patrick Peters

Labor Board Will Decide Organizing Rights of Non-Teaching Employees at Religious Colleges, Universities

The National Labor Relations Board is set to decide if the same test used to determine whether teaching employees of a religious school are subject to the Board’s jurisdiction should be extended to non-teaching employees. Islamic Saudi Academy, Case 05-RC-080474 (May 12, 2016).

The Board in Pacific Lutheran University, 361 NLRB No. 157 (2014), adopted a two-part test for determining whether to exercise jurisdiction over teachers at religious schools under the U.S. Supreme Court’s decision in NLRB v. Catholic Bishop, 440 U.S. 490 (1979). A college or university first must show it is providing a “religious educational environment” to claim an exemption from NLRB jurisdiction, the Board held. If the school satisfies that requirement, it then must show that it holds out the faculty members who a union is seeking to represent “as performing a specific role in creating or maintaining the college or university’s religious educational environment, as demonstrated by its representations to current or potential students and faculty members, and the community at large.”

On whether a school satisfies the second part of the test, the Board will determine whether the school holds out its faculty members as performing any religious function in creating or maintaining a religious educational environment. It noted that evidence in support of this requirement might include showing “that faculty members are required to serve a religious function, such as integrating the institution’s religious teachings into coursework, serving as religious advisors to students, propagating religious tenets, or engaging in religious indoctrination or religious training.” For more on Pacific Lutheran University, see our article, NLRB Announces New Standard for Exercising Jurisdiction Over Religiously Affiliated Colleges and Universities.

Islamic Saudi Academy is a non-profit private educational institution operating an elementary and secondary school at two locations in Fairfax County, Virginia. In May 2012, the Islamic Saudi Academy Employee Professional Association filed a petition to represent, among others, the Academy’s non-teachers, such as nurses, IT employees, librarians, finance clerks, and internal auditors. After several procedural twists and turns, as well as issuance by the Board of its decision in Pacific Lutheran University, the Board ordered the case remanded to the Regional Director “for further appropriate action consistent with its decision in Pacific Lutheran University.”

The Regional Director decided that, assuming Pacific Lutheran University applies to non-teaching employees at primary and secondary schools, the Academy had not established that the non-teaching classifications were held out as performing a specific religious function and that the Board should assert jurisdiction over the non-teaching classifications. The Academy then requested review by the NLRB.

It is unclear how the second part of the test (holding employees out as performing a religious function) would be applied to non-teaching employees, since the school must show the non-teacher performs a religious function in creating or maintaining a religious educational environment. Certainly, with respect to many non-teachers, satisfying the burden of proof will be a tall order.

Please contact the Jackson Lewis attorney with whom you work or any of the authors of this article for assistance regarding issues concerning the NLRA and religious schools.  For more information on Jackson Lewis’ Higher Education Industry Group, please click here.

NLRB General Counsel Proposes Severely Limiting Employers’ Right To Lawfully Withdraw Recognition from Unions

National Labor Relation Board General Counsel Richard F. Griffin has issued a Memorandum to NLRB Regional Directors, Officers-in-Charge, and Resident Officers proposing a dramatic change in Board law on whether, and under what circumstances, an employer may unilaterally withdraw recognition from a union representing its employees. Memorandum GC 16-03 (May 9, 2016).  If adopted by the Board, a unilateral withdrawal would be unlawful unless it follows an employer victory in a Board-supervised “RM” election (following an employer’s filing a petition for an election because it has a good faith doubt about the incumbent union’s majority support) or “RD” election (following an employee’s filing a petition for an election seeking to oust the incumbent union).

Fifteen years ago, in Levitz Furniture Company of the Pacific, Inc., 333 NLRB 717 (2001), the Board rejected a similar proposal by the then-General Counsel.  In that case, the Board held that “an employer may unilaterally withdraw recognition from an incumbent union only where the union has actually lost the support of the majority of the bargaining unit employees,” based on objective evidence. It “rejected the General Counsel’s position that employers should not be permitted to withdraw recognition absent the results of Board elections.”  The Board sought to encourage reliance on NLRB-conducted elections, but not bar employers from acting unilaterally where evidence indicated a union actually had lost its majority.

The current proposal by the General Counsel would have the Board reverse the Levitz decision, barring any lawful unilateral withdrawal of recognition by an employer.  Indeed, the Memorandum urges all Regional offices to treat such unilateral withdrawals as a violation of Section 8(a)(5) of the National Labor Relations Act. It also exhorts the Regions to “include in their briefs to administrative law judges and to the Board [a] model brief section” on these issues prepared by the General Counsel and attached to the Memorandum.

In support of this proposed new rule, the General Counsel points out, among other things, that the Board in Levitz left open the possibility that it would reconsider its holding in that case “if future experience proves” the Levitz rule unworkable or contrary to the purposes of the Act.  He also argues that “[e]xperience has shown that the option left available under the Levitz framework . . . has proven problematic” and that “[t]his proposed rule will benefit employers, employees, and unions alike . . . .” His memorandum, however, does not explain these conclusions.  Employers may be skeptical  that the elimination of a rule that permits an employer to unilaterally withdraw recognition from a union that has lost its employees’ support, thus permitting it to relieve employees of a representative they no longer want, would benefit it or its employees.  Nevertheless, whether the General Counsel’s belief is borne out remains to be seen.



NLRB Member Criticizes Board’s Handbook Rule Review Standard

The legality of employer work rules continues to draw National Labor Relations Board scrutiny on a regular basis.

A 2-1 Board panel majority (Members Kent Hirozawa and Lauren McFerran) has found that a hospital’s rules prohibiting employee conduct that “impedes harmonious interactions and relationships” and “negative or disparaging comments about the professional capabilities of employees or physicians” violate the National Labor Relations Act. William Beaumont Hospital, 363 NLRB No. 162 (Apr. 13, 2016).

The Board’s standard for judging these rules also continues to be a source of consternation among employers and others, including Board Member Philip Miscimarra. In William Beaumont Hospital, Miscimarra called for the Board to abandon its existing analysis, announced in Lutheran Heritage Village – Livonia, 343 NLRB 646 (2004), that renders policies unlawful “whenever an employee ‘would reasonably construe the language to prohibit Section 7 activity.’” He further contended that if the Board does not change that standard, it should be repudiated by the courts.

Miscimarra noted that the Board’s current analysis ignores an employer’s justification for various work rules that are designed to promote its legitimate interests in order, discipline, and business operations  –  justification that courts and prior Boards had recognized for decades .  He called for the Board to “resume doing what the Supreme Court has repeatedly required, which is to carry out its ‘duty to strike the proper balance between … asserted business justifications and the invasions of employee rights in light of the Act and its policy.’” Miscimarra also noted that the Board’s departures from the Supreme Court’s requirement have given rise to uncertainty and legal disputes. In his view, the Board has its “thumb on the scale” in favor of employee rights and its present test “imposes a form of blindness on the Board,” ignoring the consequences of its decisions.

Although the Board decisions generally are accorded deference by reviewing courts, Miscimarra noted that as long as fifteen years ago, the U.S. Court of Appeals for the D.C. Circuit strongly criticized the Board for its failure to consider reasons for employer policies: “We cannot help but note that the NLRB is remarkably indifferent to the concerns and sensitivity which prompt many employers to adopt the sort of rule at issue here [prohibiting ‘abusive and threatening language’]. … To bar, or severely limit, an employer’s ability to insulate itself from such liability is to place it in a ‘catch 22.’” Miscimarra also quoted the D.C. Circuit as saying, “Yet the Board’s position that the imposition of a broad prophylactic rule against abusive and threatening language is unlawful on its face is simply preposterous. It defies explanation that a law enacted to facilitate collective bargaining and protect employees’ right to organize prohibits employers from seeking to maintain civility in the workplace.” [Quoting Adtranz ABB Daimler-Benz Transportation v. NLRB, 253 F.3d 19, 27-28 (D.C. Cir. 2001).]

As convincing as Miscimarra’s arguments are, the Board’s views on employer policies may not change until the composition of the Board changes, which is likely to depend on the outcome of the Presidential election. The Board currently has four members, three Democratics and one Republican. Although he has been renominated by President Obama, Hirozawa’s term ends in August of this year and the Senate may not act on his renomination by the end of Obama’s presidency.

New Georgia Law Says Franchisors Generally Not Employers of Franchisees or Franchisees’ Workers

The “Protecting Georgia Small Businesses Act” amends Georgia’s Labor and Industrial Relations Code to provide that neither a franchisee nor a franchisee’s employee is considered an employee of a franchisor for “any purpose.” However, the amendment does not apply to Georgia Workers’ Compensation Code. The Act goes into effect on January 1, 2017.

The Georgia Legislature reportedly passed the Act in response to the National Labor Relations Board’s ruling in Browning-Ferris Industries of California, Inc., 362 NLRB No. 186 (Aug. 27, 2015). In that case, the NLRB broadened its definition of a “joint-employer” to include any entity that: (1) could exercise control over another entity’s employees’ terms and conditions of employment, whether it actually does so or not, or (2) exercises any such control through a third party.

In the wake of Browning-Ferris, several states have introduced legislation aimed at protecting businesses from the wide-ranging effects of the NLRB’s aggressive decision. For example, seven states (Texas, Louisiana, Tennessee, Wisconsin, Michigan, Indiana, and Utah) have passed legislation that, like the Georgia law, prohibit a franchisor from being considered an employer or co-employer of franchisee employees. (S.B. 652, 84th Leg., Reg. Sess. (Tex. 2015); La. Rev. Stat. 23:921(F)(2) (2015); Tenn. Code Ann. § 50-1-208(a) (2015); Wisconsin S.B. 422, 2015-2016 Session; (Michigan) MCL 421.1, et seq.; Section 41(11); 8 MCL 408.411, et seq., Section 2(d); 9 MCL 408.1001, et seq., Section 5(2); 10 MCL 408.471 et seq., Section 1(d); 11 MCL 418.101 et seq.; Indiana House Bill 1218 (2016); Utah H.B. 116, 2016 General Session.)

Similar legislative efforts have been introduced in California, Colorado, Massachusetts, Oklahoma, Pennsylvania, Vermont, and Virginia. (California (AB 545), Colorado (HB 16-1154), Massachusetts (HB 3513), Oklahoma (HB 3164), Pennsylvania (HB 1620), Vermont (HB 694) and Virginia (HB 18).) Legislators in Wyoming, North Carolina, Arizona, and Colorado are evaluating similar efforts.

Although the Protecting Georgia Businesses Act, and other state legislative actions, likely are preempted by the National Labor Relations Act, they represent yet another example of lawmakers’ attempts to rein in what has been described as an “activist” NLRB.

Jackson Lewis attorneys are available to answer inquiries regarding this and other developments.


Obama Reappoints NLRB Member Hirozawa, But Senate Not Expected to Act Quickly

Board Member Kent Y. Hirozawa has been reappointed by President Barack Obama to a second term on the National Labor Relations Board, according to the White House.

Hirozawa, whose current term expires on August 27, 2016, is one of three Democrats on the NLRB, along with Chairman Mark Gaston Pearce and Member Lauren McFerran. The fourth current Member is Republican Philip Miscimarra. If confirmed by the United States Senate, Hirozawa’s term will expire in 2021.

The fifth seat on the Board became vacant when Republican Harry Johnson’s term expired on August 27, 2015. President Obama has taken no action to fill that seat. Typically, three of the Board’s five seats are occupied by Members who belong to the same political party as the President. The NLRB can act on matters as long as it has at least three validly appointed Members.

Quick Senate action on Hirozawa’s nomination is not expected. If Hirozawa’s nomination has not been confirmed before the end of his current term, Board-watchers expect that before he leaves, the NLRB will release a flurry of decisions on cases in which he participated.

Late Mail Delivery Turns Out to be Problem [Again] for Mail Ballot Election

The NLRB has ruled that there is a significant difference between an employee’s having the opportunity to vote in an NLRB mail ballot election and his or her vote being counted.

In Premier Utility Services, LLC, 363 NLRB No. 159 (Apr. 5, 2016), 101 employees living and working in New York City’s five boroughs were eligible to vote in a mail ballot election ending November 4, 2015, to determine whether Communications Workers of America, Local 1101 would represent the workers. By the November 5 tally date, the NLRB had received only four ballots, so the parties agreed to postpone the vote count until November 12. Still, by that date, the Board had received only 34 ballots, from just about a third of the eligible voters. Nevertheless, the ballot count occurred and the union received a majority of the votes, 20-14.

Sure enough, following the count, the NLRB Regional office received 48 ballots that were postmarked before November 4, the end of the voting period. However, the Regional Director refused to count them and certified the union as the exclusive bargaining representative for the 101 employees, despite having received the votes of scarcely one-fifth of the unit employees.

The employer filed “objections” to the Regional Director’s decision not to count the 48 late-arriving ballots, as they could have affected the results, but the objections were overruled.  The Board denied the employer’s request for review and upheld the Regional Director’s decision.  The NLRB panel majority (Chairman Pearce and Member Hirozawa) expressed “concern about the United States Postal Service’s late delivery of many, many ballots after the count,” but noted that the Board “customarily does not permit mail ballots received after the count to be opened,” citing Classic Valet Parking, 363 NLRB No. 23 (Oct. 23, 2015). In Classic Valet, the Board refused to count ballots that were timely mailed, but not received by the deadline because “adhering to [its] established practice” of counting votes by a fixed deadline was deemed more important than its purported “strong interest in effectuating employee choice” by counting all timely-mailed ballots, citing Kerrville Bus. Co., 257 NLRB 176 (1981). In Kerrville Bus, however, the Board actually counted all ballots mailed at least three days before the deadline from a city within 100 miles because those “employees mailed their ballots at a time when they could reasonably anticipate timely receipt by the Board through the normal course of the mails. … As a matter of fundamental statutory policy, it behooves the Board ‘to afford employees the broadest possible participation in the Board elections’ as long as ‘the election procedures are not unduly interfered with or hampered.’”

Member Miscimarra dissented in both Premier Utility Services and Classic Valet, voicing the concern the employers in those cases no doubt had with the Board’s rigid adherence to rules that resulted in its refusing to count a determinative number of votes – that when the Board’s regular procedures have been deficient, its “normal rules must be balanced against [the Board’s] statutory responsibility to assure that employees have been reasonably permitted to freely exercise their rights under the Act.”



Employee Disloyalty Not Sufficient for Firing Where Part of Concerted Protest, Board, Court Hold

The National Labor Relations Board did not err in holding a sandwich store chain violated the National Labor Relations Act by disciplining and terminating employees for placing posters on community bulletin boards in the public areas of several of its locations suggesting the chain required sick employees to come to work and make sandwiches, the federal appeals court in St. Louis has ruled. MikLin Enters., Inc. v. NLRB, No. 14-3099 (8th Cir. Mar. 25, 2016).

MikLin Enterprises owns and operates several Jimmy John’s restaurants in Minneapolis, Minnesota. It had a sick leave policy that required employees to find replacement workers when they called out sick. Several employees attempted to persuade the company to change the policy by placing posters on community bulletin boards. According to the court, the posters:

featured two identical, side-by-side photographs of a sandwich…. Above the left sandwich was a label stating: “Your Sandwich Made By A Healthy Jimmy John’s Worker.” Above the right sandwich was a label stating: “Your Sandwich Made By A Sick Jimmy John’s Worker.” Below the photographs, the poster stated: “Can’t tell the Difference?” “That’s Too Bad Because Jimmy John’s Workers Don’t Get Paid Sick Days.” “Shoot, We Can’t Even Call In Sick.” “We Hope Your Immune System Is Ready Because You’re About To Take The Sandwich Test.”

MikLin removed the posters, but . . . the employees then posted the flyer in public areas surrounding several Jimmy John’s restaurants. Those flyers also included the telephone number of MikLin’s co-owner and vice-president. The employer did not change its sick leave policy.

MikLin fired six employees for “being the leaders and developers” of the flyer campaign and disciplined three others for being “foot soldiers” in the campaign.

Unfair labor practice charges were filed against MikLin alleging violations of the NLRA. By a 2-1 vote, the NLRB held the flyers were “sufficiently related to an ongoing labor dispute to be protected and that there was nothing in the posters that was so disloyal, reckless, or maliciously untrue so as to cause the employees to lose the Act’s protection.” It said that in order to lose the NLRA’s protection, a false statement has to be made with “actual malice,” which it defined as “knowledge of falsity or reckless disregard for the truth.” The Board held that actual malice was not shown in this case.

MikLin appealed, and in a 2-1 decision, the Eighth Circuit affirmed. Finding substantial evidence to support the Board’s decision that the flyer’s untrue claim that workers could not call-out sick was not so maliciously false as to place it outside the Act’s protection, it enforced the Board’s order.

Dissenting, Judge James Loken said the Board’s definition of malice was so narrow that it effectively removed employee disloyalty from the analysis. He would have found the employees’ knowledge of the statement’s falsity concerning their ability to call in when sick was sufficient to show a malicious intent to harm the employer, which was not protected. The discharge of employees, therefore, would not violate the Act, in Judge Loken’s opinion.

The decisions in this case raise questions about the signal they might send about employee latitude when publicly disparaging their employers and how employer and employee rights will be balanced.




Doubling Down: NLRB Joint Employer Standard Under Dual Review

Whether the National Labor Relations Board’s recently articulated joint employer standard can withstand judicial scrutiny is about to be tested. Browning Ferris Industries of California has filed a petition for review (in the United States Court of Appeals for the District of Columbia Circuit) of the NLRB’s bargaining order, asking the Court to deny enforcement of the Board’s Order requiring the company to bargain with the union based on an election conducted pursuant to the agency’s decision in Browning-Ferris Industries of California, Inc., 362 NLRB No. 186 (2015). That decision significantly eased the requirements for showing joint employer status, and is often cited as allowing unions to leverage their bargaining power by requiring host employers to bargain with unions that have organized a staffing company’s employees who work on the staffing company’s premises.

Meanwhile, the Board is reviewing an NLRB regional director’s decision refusing to find a staffing agency was a joint employer with a host construction contractor in the wake of the Board’s decision in Browning-Ferris. Green JobWorks LLC/ACECO, LLC, is believed to be the first case post-Browning-Ferris to apply the new joint employer standard and the Board’s review is expected to provide greater guidance regarding its intended reach.

As we noted in our post, Union Seeks Labor Board Review of Regional Director’s Adverse Joint Employer Decision, the Regional Director for Region 5 (Baltimore) concluded that the union failed to establish “specific, detailed and relevant evidence” demonstrating a joint employment relationship comparable to BFI. The union then sought review of the decision.

The Board granted the union’s Request for Review, agreeing to revisit the application of Browning-Ferris in the construction industry setting. The parties recently filed their briefs. ACECO, the host contractor employer, argued the Regional Director correctly applied all of the criteria set forth in Browning-Ferris and properly concluded that the facts of this case are significantly different from the facts of BFI. In the alternative, ACECO argued that Browning-Ferris must be overruled as improperly decided.

Conversely, the union argued that the Regional Director’s decision was contrary to Browning-Ferris. Moreover, because the Regional Director ordered an election that named only Green JobWorks as the employer, the union argued it was unable to negotiate with ACECO, a party with material control over the discipline, discharge, transfer, layoff, recall, placement, wages, overtime pay, and even hiring of employees of Green JobWorks. The union concluded that unless the Board reverses the decision, Browning-Ferris will be undone and joint employer determinations “will continue to be based upon microscopic parsing of the degree and routineness of the control exercised or held by putative joint employers.”

A Board decision in Green JobWorks is not expected before fall. We will keep you apprised as the Board provides further guidance on this important issue.




NLRB General Counsel Announces Wish-List Of “Hot-Button” Issues To Be Handled By His Office

The National Labor Relations Board’s General Counsel has assembled his latest wish-list of “hot-button” issues he hopes to present to the Board for decision when the right cases are presented to his office.

Because certain NLRB unfair labor practice cases “are of particular interest and would benefit from centralized consideration,” the General Counsel has determined that they “should be submitted to the Division of Advice” rather than decided by the Regional Office where the charge is filed. Memorandum GC 16-01, “Mandatory Submissions to the Division of Advice,” dated March 22, 2016, from General Counsel Richard F. Griffin, Jr., is addressed to all NLRB Regional Directors, Officers-in-Charge and Resident Officers. This will allow the General Counsel’s Office in Washington to make the decision whether to prosecute cutting-edge issues in certain cases.

The types of cases recommended for submission to the General Counsel’s Office Division of Advice are divided into three groups in the Memorandum. The first and second are most important because they offer insight into areas of particular interest to the General Counsel where he may urge the Board to change its interpretations of the NLRA in a suitable case.

The first group includes those matters that involve General Counsel initiatives or priority areas of the law and labor policy. Included in this group, among others, are cases involving: (1) the application of Purple Communications, 361 NLRB No. 126 (2014) to electronic systems other than email, (2) the applicability of Weingarten principles in non-unionized settings, (3) allegations that “English-only” policies violate the National Labor Relations Act, and (4) whether the misclassification of employees as independent contractors violates the NLRA.

Purple Communications held that employers generally could not bar employees from using company email systems for personal reasons, including union organizing, during non-work time.

The Supreme Court’s 1975 decision in NLRB v. J. Weingarten, Inc., 420 U.S. 251, held that unionized employees were entitled to the assistance of their union representative during investigative interviews by their employer that the employee reasonably believed might lead to his discipline. However, the Board has seesawed over whether Weingarten also should apply in non-union settings. The Board held Weingarten applicable in non-union settings in Epilepsy Foundation, 331 NLRB 676 (2000), but subsequently reversed itself in IBM Corp., 341 NLRB 1288 (2004).

The second group consists of matters that involve “difficult legal issues or the absence of clear precedent.” The General Counsel wants to review cases involving: (1) the rights of contractor employees to have access to the property where they are working to communicate with coworkers or the public, (2) whether novel forms of disruptive conduct, such as coordinated “shopping,” excessive use of loudspeakers, or corporate campaigns, constitute violations of the NLRA, and (3) the need to harmonize the NLRA with local, state or federal statutes or where potential or actual overlapping jurisdiction with other federal agencies exists, among others.

The Memorandum lists a total of 24 types of cases in the two groups that must be submitted to the Division of Advice, although it also recognizes that “the vast majority of cases may be processed without guidance from Headquarters.” In light of the Memorandum, 2016 and beyond should prove to be “interesting times” in labor law.