Labor Law Lessons from Our Favorite Films: Dirty Dancing

There are films with clear labor law undertones, such as On The Waterfront and Norma Rae. The National Labor Relations Act and its teachings, however, lurk in other pop culture examples.

Thirty years ago, the romantic drama, Dirty Dancing premiered. The plot centers around the relationship between Baby (Frances) Housman (coincidentally, named after the first female Secretary of Labor) and Johnny Castle, a staff dance instructor, during the summer of 1963 at Kellerman’s, a fictitious Catskills resort.

When brazen thieves start stealing money and jewelry from guests all across the Catskills, one of the resort’s guests who had a previous relationship with Johnny reports Johnny as a burglary culprit to Kellerman’s management in retaliation.

Johnny denies involvement in the burglaries (more on Weingarten rights in a later post) and Baby even pleads to the resort’s owner to consider an elderly couple as possible suspects. When that fails, Baby provides a critical alibi for Johnny (that she was with him on the night of the burglary). Johnny is terminated anyway.

However, in a critical plot twist, Baby was right — the elderly couple were the culprits. However, Johnny delivers bittersweet news:

Frances “Baby” Houseman: They fired you anyway because of me!

Johnny Castle: And if I leave quietly, I’ll get my summer bonus.

Labor law questions/lessons:

Did Kellerman’s violate the NLRA by keeping Johnny from engaging in protected concerted activity under the NLRA by threatening to withdraw a benefit (his summer bonus) in exchange for his silence? Johnny could argue that he reasonably feared he would face reprisal if he shared his concerns with his coworkers about how Kellerman’s addressed false accusations. In defense, Kellerman’s could assert that Johnny’s scenario amounts to nothing more than his individualized gripe (i.e., his discipline does not involve other employees) and does not qualify as concerted activity. Kellerman’s also could defend by arguing that at the time he was told to keep quiet, he already had been terminated, and thus, was no longer an employee under the NLRA. However, Section 2(3) of the NLRA defines “employee” to include those who have been terminated as a result of an unfair labor practice. Under the current state of the law, the National Labor Relations Board likely would side with Johnny on that issue.

Kellerman’s is not out of options in defending against Johnny’s claim, however. Under the Wright Line theory (the case is from 1980, but we need to suspend reality just a little bit here), Kellerman’s would not be liable if it could show it would have terminated Johnny regardless of whether he engaged in protected concerted activity. Here, Kellerman’s could argue that romantic relationships between staff and guests are prohibited. Of course, Johnny would have the opportunity to rebut that explanation as pretextual, perhaps by showing that other staff members engaged in similar activity, but were not disciplined.

Under a pro-employee, Kennedy-era NLRB, odds would be on Johnny in this dispute. However, under the soon-to-be newly composed Trump-era NLRB, the odds certainly shift in Kellerman’s favor. Stay tuned — Johnny (and his union) may have other unfair labor practices for us to consider in the coming weeks.

Breaking News: NLRB Chairman Miscimarra Declines Second Term

Reportedly citing personal reasons, National Labor Relations Board Chairman Philip Miscimarra has declined consideration for a second term on the Board. Miscimarra’s term expires on December 16, 2017, and the Board is facing a slashed budget.

Miscimarra, seen as pro-business, has become known for his numerous strong dissents in opposition to labor-friendly decisions by the Obama Board.

During the past several years, business leaders have been stung by Board decisions that, among other things, have dramatically expanded the scope of the joint employer doctrine and found a host of common work rules unlawful.

Miscimarra repeatedly has written scathing dissents to those pro-labor rulings. Many Board observers have predicted that those dissents will provide a framework which President Donald Trump’s Board may follow to overturn many of those Obama-era decisions.

The NLRB currently has two vacancies, although one of Trump’s two nominees – both Republicans — has been confirmed by the Senate, while the other awaits hearing in the United States Senate.  That nominee, William Emanuel ,also is expected to be confirmed, giving the Board a 3-2 Republican majority until December, when Miscimarra’s term ends.  It is expected that Trump will nominate a Republican to fill that seat as well.

 

 

 

 

 

 

Management Labor Attorney Being Considered for NLRB General Counsel Nomination

Peter B. Robb, a management-side labor law attorney, reportedly is being considered to be the National Labor Relations Board’s next General Counsel. The four-year term for the current NLRB General Counsel, Democrat Richard F. Griffin, Jr., expires this November. Robb previously worked as an NLRB field attorney and as chief counsel to Republican NLRB Member Robert P. Hunter.

When President Donald Trump took office, the NLRB had two Democratic (former Chairman Mark Gaston Pearce and Lauren McFerran) and one Republican (current Chairman Philip Miscimarra) members, and two vacant seats. The Senate has confirmed Republican Marvin Kaplan to one of the two vacant seats, while management labor attorney William Emanuel awaits a confirmation hearing.

If, as expected, Emanuel also is confirmed, Robb’s nomination and confirmation would set the stage for the Board to reverse many of the pro-labor rulings issued by the Obama Board.

Robb has been critical of the Board’s “tenacity to find neutral policies…unlawful,” such as employers’ social media policies and values statements. Robb has also argued that the NLRB’s new “quickie” representation election procedures give unions “a distinct advantage” (for example, by shortening the timeframe in which an employer has to react to a union election petition), and signaled that he would seek to undo the Obama Board’s expansion of the Board’s “joint employer” doctrine. These issues have been a primary focus of Republicans in recent years.

The NLRB General Counsel controls which cases the Board prioritizes and pursues. Robb would be in position to bring appropriate “test cases” to the newly full Board to reverse those Obama-Board decisions that many business owners have argued go too far in favoring unions’ agenda.

Even if Robb is nominated and confirmed as General Counsel, he will not take office until after Griffin’s term expires, in November. After that, it likely will take many months for the appropriate cases to make their way to the NLRB for decision and for changes to be realized.

 

 

 

 

 

 

 

 

Senate Confirms Kaplan for Vacant Board Seat, Moving NLRB Closer to Pro-Business Majority

The United States Senate has narrowly confirmed former counsel to the Commissioner of the Occupational Safety and Health Review Commission Marvin Kaplan to one of two vacant seats on the National Labor Relations Board. Kaplan’s confirmations leaves one vacant seat on the five-member Board.

President Donald Trump has nominated management labor lawyer William Emanuel for the other open slot on the NLRB. If Emanuel is confirmed – the Senate HELP Committee approved his nomination on July 19 — Republicans will hold a 3-2 majority on the Board for the first time since 2010. (A vote on his nomination has not been scheduled.) A full Board is expected to reverse many of the pro-labor rulings by the Obama Board, including those on class action waivers, joint employer, temporary workers, quickie elections, expansion of protected concerted activity (e.g., its impact on workplace policies), definition of appropriate bargaining units, and the status of college/university faculty and student athletes, among others.

 

Missouri Law Prohibits Costly Public Project Labor Agreements

On May 30, 2017, Missouri Governor Eric Greitens signed legislation generally barring public entities from requiring job-specific union contracts called “project labor agreements” on public construction projects.  

The legislation, effective August 28, 2017, prohibits public entities from requiring contractors to enter into project labor agreements and from discriminating against, encouraging, or giving preferential treatment to union contractors, or those voluntarily adhering to union contracts.  

While the Missouri Senate and House were unable to pass legislation repealing the state’s “prevailing wage” law (which requires contractors to pay their employees a minimum amount in wages and benefits on certain publically funded projects, generally calculated based on local union contracts), Senate Bill 182 bars public entities from requiring contractors to become signatories to project-specific labor contracts that specify wages, benefits, and a broad scope of other union terms and conditions.  

Greitens, a Republican political newcomer, campaigned on a business-friendly platform. Greitens signed “right-to-work” legislation just weeks after taking office. Signing Senate Bill 182 is seen as another campaign promise fulfilled.  

At a signing ceremony with Wisconsin Republican Governor Scott Walker, Greitens said that project labor agreements “drive up the cost of construction projects” and, while it is the taxpayers who ultimately pay for these publically funded projects, “in the past, taxpayers got a raw deal.”  

The Missouri Senate and House are considering several bills that would partially or completely repeal the state’s prevailing wage law, but no such bill was able to reach the Governor’s desk. If one does, he is expected to sign it. Missouri legislators have been pushing for the repeal of prevailing wage for years, but the previous governor had vetoed every effort. 

The Governor’s supporters reiterate that these pieces of legislation are necessary to provide a level playing field for all contractors, union and non-union, and that local public entities will save money. Opponents argue that the Governor’s agenda will hurt local workers who risk losing work to “outside,” non-union contractors who can underbid contractors bound to union contracts.  

Senate Bill 182 provides a legal remedy for violations, including the recovery of attorney’s fees and referral to the local prosecuting attorney or circuit attorney for investigation. 

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

 

 

Change is Coming: Management-Side Labor Attorney Emanuel Nominated to Labor Board

President Donald Trump has nominated management labor attorney William Emanuel to fill one of the two vacant seats on the five-member National Labor Relations Board.

Trump previously had nominated attorney Marvin Kaplan, counsel to the Commissioner of the Occupational Safety and Health Review Commission, for the other vacant seat.

If Kaplan and Emanuel, Republicans, are confirmed by the United States Senate, the Board will have a 3-2 Republican majority. (Chairman Philip Miscimarra also is a Republican.) Senate confirmation of Kaplan and Emanuel is expected.  Confirmation hearings by the Senate Health, Education, Labor and Pensions Committee will be held on July 13.

Once the new Board members are confirmed, expect the Board to revisit its employee/union-favored rulings on class action waivers, joint employer, temporary workers, quickie elections, expansion of protected concerted activity (e.g., its impact on workplace policies), definition of appropriate bargaining units, and the status of college/university faculty and student athletes, among others.

Federal Court Washes Away New York City’s Pro-Union Ordinance

A New York City ordinance requiring car wash companies to post a higher surety bond if they do not sign a union bargaining agreement covering their employees is invalid because it unlawfully favors unionization, and therefore runs afoul of the National Labor Relations Act, a federal district court judge has ruled on May 26, 2017. Association of Car Wash Owners v. City of New York, No. 15 Civ. 8157.  The ordinance was signed by Mayor Bill de Blasio on June 29, 2015, and the lawsuit was filed in 2015 by the Association of Car Wash Owners representing 100 car washes within the City.

The Car Wash Accountability Law, also known as Local Law 62, required all car wash companies doing business in New York City to post a $150,000 surety bond in favor of employees. However, if a car wash signed a collective bargaining agreement or agreed to monthly audits of its pay practices by a third party, the bond would be reduced drastically to just $30,000! The bond was intended to cover possible employee wage complaints, customer complaints, or penalties imposed by the City.

Overturning the pro-union statute, the judge held the ordinance violated federal labor law by imposing a penalty on businesses that do not agree to enter into collective bargaining agreements with unions. Judge Hellerstein pointed out that some City Council members’ statements in support of the ordinance provided evidence against the City, since “the legislative history makes clear that a central purpose of Local Law 62 is to encourage unionization in the car wash industry.”

The court held that the local statute was preempted by the NLRA because “states may not legislate in opposition to a federal law.” The court held that the ordinance had the effect of “pressuring businesses to unionize, [which] is impermissible under the NLRA, as it inserts the City directly into labor-management bargaining.”

A Union Has Filed A Petition To Represent Your Employees: Make A List And Check It Twice!

Several deficiencies in a voter eligibility list justified rerunning an election that the employer had won, the NLRB has held, 2-1 (Chairman Philip Miscimarra dissenting in part). RHCG Safety Corp., 365 NLRB No. 88 (June 7, 2017).

The Board found that more than 90% of the voters’ addresses on the list provided by the employer were wrong, 15 of the 99 eligible voters were left off, and no phone numbers were provided (HR did not maintain them in its database) despite supervisors and foremen informally having this information and using it for work-related contacts with employees.

Beginning April 2015, under the new NLRB election rules, employers must provide an expanded voter eligibility list – including not only the names and home addresses required under the old rule, but also “available” home and cell phone numbers (as well as job titles, work locations, and “available” email addresses) to the union filing an election petition. On top of that, employers have only two days from finalization of the election details to assemble and serve this comprehensive list.

Employers must complete the list with care. Failure to provide a thorough and accurate list will be grounds for an “objection” filed by the union should it lose the election. The usual remedy is rerunning the vote if the company wins.

The problem with incorrect addresses and omitted names is straightforward, but what does the Board mean by “available” phone numbers and e-addresses? The rules’ preamble retains the traditional understanding that employers do not have to solicit information from voters in order to compile the list. So, does that mean HR’s information is sufficient under the new voter list rule? The Board in RHCG said no. That the employer did not keep formal HR records of employees’ phone numbers did not shield the company – because members of management had the information, and called employees for work reasons, the phone numbers were deemed “available” to the company. The employer should have investigated and collected these numbers from supervisors, the Board said.

Among other things, the employer argued its mistakes were inadvertent. The Board responded that a reason for the new rule is to maximize the “likelihood that voters will be exposed to the non-employer party arguments” concerning the election. Good faith by the employer is not necessarily relevant.

If your company is facing a Board election, be very careful in compiling the voter list. The NLRB’s election rules will be interpreted strictly. In our firm’s long experience, employer compilation of this list frequently is more time consuming than one might expect – that is underscored by the new rules (and now this case). Start assembling the needed data as soon as an election petition is filed.

Please contact Jackson Lewis with any questions about this and other developments.

NLRB’s Budget Slashed: What Could It Mean To Your Business?

President Donald Trump has released a budget proposal reducing the National Labor Relations Board’s funding in fiscal year 2018 by nearly six percent. It also calls for significant staff reductions at a time when the agency’s caseload is projected to increase.

Under the proposal, the Board’s funding would be reduced by $16 million, from $274 million to $258 million, which would result in the lowest total operating budget for the Board since 2009. The reduced budget will require the Board to reduce staff from approximately 1,596 to 1,320 – well below the 15-year average of 1,700 full-time employees.

The NLRB had sought additional funding to “efficiently and effectively” process “comprehensive and complex cases,” such as “nationwide efforts to improve the wages … of retail and fast food workers,” “expanded use of mandatory arbitration clauses in employment” agreements, and the expanded use of technology and social media by employees to discuss employment outside the workplace, among other things.

The budget also includes an “administrative provision” prohibiting use of appropriations to adopt electronic voting in union representation elections. In the past, the NLRB had asked vendors to submit possible solutions on secure methods for electronic balloting, but had not acted on the subject.

What could the budget cut mean for your business? The budget has not been passed by Congress, and there likely will be significant congressional debate over funding of the NLRB (and other agencies, such as the Department of Labor, which also may face significant budget cuts). If the budget passes with significant cuts, expect the following:

  • The NLRB to ramp up the pressure on employers, unions, and employees to settle unfair labor practice charges early to avoid NLRB personnel having to travel to speak to potential witnesses.
  • The NLRB to loosen its time targets for deciding whether unfair labor practice charges have merit in the hopes that, given more time, a case can be settled.
  • The possibility of less-prepared NLRB witnesses in unfair labor practice trials because possibly overtaxed NLRB attorneys will not have been able to meet with witnesses as much as in the past.
  • Requests by the Board to administrative law judges to permit witness testimony by video to avoid having to pay witness travel costs.
  • The NLRB to struggle to process representation petitions quickly, which has been a key focus of the agency since the “quickie” election rules were implemented in April 2015.

Employers must adapt to these and other possible changes if the budget cut is approved. We will monitor the budgetary process and report on significant developments.

 

 

Labor Board Allows Evidence to Explain Employee Handbook Ban on Video Recording

The National Labor Relations Board has denied a motion for summary judgment by the NLRB’s General Counsel in a case involving Mercedes-Benz U.S. International Inc.’s maintenance of an employee handbook rule prohibiting the use of cameras and video recording devices without prior approval.

The 2-1 decision allows MBUSI to attempt to prove that: (1) the rule “furthers legitimate business interests, including the protection of proprietary and confidential information, the maintenance of safety and production standards, and open communication” by employees; (2) the rule is not per se unlawful under Section 8(a)(1) of the National Labor Relations Act because employees at the plant “did not understand the camera rule to restrict Section 7 activity” under the NLRA; and (3) “its business interests outweigh any Section 7 rights” that may be implicated by its maintenance of the rule.

The Board majority — Chairman Philip A. Miscimarra and Member Lauren McFerran — made it clear that it was expressing “no view” on the merits of the case. Thus, whether the company’s evidence at trial will be sufficient to win the day remains to be seen. Nevertheless, citing previous Board decisions reaching the same conclusion, the majority in the Mercedes-Benz U.S. International Inc. case rejected a lengthy dissent by Member Mark Gaston Pearce that would have found the no-recording rule unlawful on its face.

Employers with similar handbook rules that may be considered unlawful by the NLRB’s General Counsel, which has been waging war against common workplace rules of all types, may take comfort in the majority’s decision. Employers should review their handbooks and policy manuals carefully to make sure the rules within them do not “reasonably tend to chill employees in the exercise of their Section 7 rights” under the NLRA.

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