Ring Confirmed to Join NLRB

John Ring, a management labor attorney, has been confirmed by the U.S. Senate to a seat on the National Labor Relations Board, filling the NLRB’s only remaining vacancy.   Ring was confirmed by a 50-48 vote.  The Board now has a full complement of five members — three Republicans and two Democrats.  The Board is expected to overturn a number of union-friendly Obama-era decisions.

Charter Schools Covered by NLRA? Not in Texas

The U.S. has more than 6,000 charter schools. They are authorized in almost every state. While state laws vary, their purpose is the same: to permit alternatives to traditional public schools, unbound by local school districts or district-wide collective bargaining agreements that can stifle innovation.

These laws frame charters as public schools, subject to the usual educational goals and regulations. While publicly funded, each school is initiated by private individuals, rather than a public entity. Founders apply for a charter to an authorizing body (usually a government entity). If granted, the school is governed by a board of trustees comprised of private individuals. The state does not appoint trustees and has only attenuated power to remove them.

Most states provide collective bargaining rights for public employees. A few do not. However, Section 7 rights for protected concerted activity enjoyed by private sector employees under the National Labor Relations Act have not been applicable. By statute, a “state or a political subdivision” cannot be a covered “employer” under the Act. Thus, it was assumed that charters’ labor relations would be governed by whatever state labor law applied to public schools.

However, in 2012, the National Labor Relations Board returned to an old standard affirmed by the Supreme Court where an employer is deemed a “state or political subdivision” if it is (1) created directly by the state to be a department or administrative arm, or (2) administered by individuals who are responsible to public officials or to the general public.

Under this standard, if the school was not initiated by a government official or entity, its leadership is not appointed by the state, and its trustees are removable only by the state in unusual circumstances, the school is not exempt from the NLRA as a public entity. The Board and its regional offices consistently have held since 2012 that charters in Arizona, California, Connecticut, Illinois, Louisiana, Michigan, Minnesota, New York, Ohio, Oregon, Pennsylvania, Tennessee, and the District of Columbia are subject to the NLRA. Indeed, since 2012, there have been no cases in which the Board failed to find NLRA jurisdiction over a charter school.

Until now.

In LTTS Charter School, 366 NLRB No. 38 (Mar. 15, 2018), an individual employee filed an unfair labor practice charge against her charter school employer, alleging retaliation against the employee for engaging in protected concerted activity. Based on the growing body of Board cases, the regional director found NLRA jurisdiction and issued a complaint. After a trial, an NLRB administrative law judge found the Act did not confer jurisdiction over the school. The Board upheld the decision and dismissed the case.

Texas charter school law differs from other states’. Commonly, under certain circumstances, a state may remove members of school governing bodies; but Texas law permits the state to disband and reconstitute the membership – including appointing new members. This distinction was enough for the Board to find the school’s leadership was “responsible to public officials.”

Thus, Texas law, not the NLRA, governed the employment relationship, and Texas law does not recognize public employees’ rights to engage in concerted activity or to unionize.

LTTS applies only where this Texas law applies. Other states articulate government oversight differently. Charter schools (at least outside Texas) should note that NLRB jurisdiction remains the law in some states (and possibly in states in which the issue has yet to be tested). Schools interested in reviewing the potential for Board jurisdiction (or in considering a challenge to jurisdiction) should consult counsel.

John Ring Expected to be Confirmed to NLRB This Week

According to an April 9, 2018, press release by the office of United States Senator Lamar Alexander (R-Tenn.), John Ring, a management labor attorney, is expected to be confirmed by the Senate this week to serve as a member of the National Labor Relations Board.

Alexander said:

America’s workers will benefit from . . . [John] Ring at the National Labor Relations Board. Mr. Ring is a well-qualified nominee to serve on the labor board – he has represented management and worked for a labor union . . . .

Senate Majority Leader Mitch McConnell (R-Ky.) filed cloture on Ring on March 22 to end debate and vote on the nomination.

If Ring is confirmed, the NLRB will be at full strength for the first time since mid-December, when former Chairman Philip Miscimarra’s term expired. Ring’s confirmation would give Republicans a 3-to-2 majority on the NLRB, and set the stage for probable reversal of several Obama-era Board decisions.

Senate Vote on Labor Board Nominee Ring Scheduled

Floor consideration of the nomination of Republican John Ring to be a member of the National Labor Relations Board is scheduled to take place in the Senate on April 9.

Ring is expected to be confirmed by the Republican-majority Senate. If he is confirmed, the NLRB will have a 3-to-2 Republican majority. (For more on Ring, see our post, Labor Board Nominee Ring Approved By Senate Committee.)

Labor Board Nominee Ring Approved By Senate Committee

The Senate Health, Education, Labor and Pensions (HELP) Committee has confirmed Republican John Ring to the National Labor Relations Board by a 12-11 vote. The next step is a vote by the full Senate.

The Board is currently composed of two Democratic and two Republican appointees. If Ring is confirmed by the full Senate, the NLRB will have a 3-2 Republican majority until 2020.

Ring, a management-labor lawyer since 1998, would replace former NLRB Chairman Philip Miscimarra, whose term ended in December 2017.

Some of the HELP Committee’s questions to Ring were on potential conflicts of interest if he is confirmed. In response, Ring said that he “will not participate in any matter that comes before the Board” if his current firm (Morgan, Lewis & Bockius) “represents or represented, a party.”

While questions about potential conflicts of interest are standard in the confirmation process, an actual conflict noted by the Board’s Inspector General prompted the NLRB to reverse and vacate its latest joint employer decision. For details, see our post, NLRB Vacates Hy-Brand Joint Employer Decision Following Inspector General Report.

We will continue to monitor and report on important NLRB developments. Please contact us if you have questions.

Employee’s Improper Access to Secured Area Outweighs Right to Engage in Concerted Activity, NLRB Finds

The National Labor Relations Board has held that an employee lost the protection of the National Labor Relations Act when he improperly accessed a secure area of the employer’s hotel, even though he did so in order to engage in otherwise protected concerted activity. KHRG Employer, LLC, 366 NLRB No. 22 (Feb. 28, 2018).

The employee, a hotel server and member of the union’s organizing committee, was discharged after leading a delegation of 20 individuals into a secure, non-public area of the hotel to deliver a petition about workplace conditions to the hotel’s general manager. The employee lied to a security officer and used an employee-only passcode in order for the group (consisting of employees and non-employee union committee members and supporters) to gain access to the secured area.

Although delivering the petition was unquestionably a protected concerted act, the Board held the employee’s conduct in improperly accessing the secured area was so egregious that his conduct nonetheless fell outside the NLRA’s protections. The NLRB relied on the balancing test set forth in Consumers Power Co., 282 NLRB 130, 132 (1986), which weighs an employee’s right to engage in protected concerted activity – with some leeway for impulsive behavior – against an employer’s right to maintain order and respect.

Here, the Board determined that the employee’s conduct (particularly his misrepresentation to the security officer) was a premeditated and flagrant violation of the employer’s security protocol, which placed other employees and the hotel property at risk. While the employee attempted to excuse his behavior by identifying other instances in which non-employees gained access to the secure area, the Board noted that these non-employees never had gained access through misrepresentation. The Board concluded the employee’s breach of security could not be “dismissed as an impulsive act” and the employee thus “engaged in sufficiently egregious misconduct to forfeit the Act’s protection.”

Employers are reminded they should not assume that all group activity is protected concerted activity and, thus, exempt from discipline. However, the Board’s standard is difficult to meet , and an employer should carefully analyze all of the facts before considering whether to discharge or discipline an employee who engages in misconduct as part of his or her protected concerted activity.

 

Infighting at NLRB

In response to new National Labor Relations Board General Counsel Peter Robb’s proposed changes to case processing and regional office structure, two groups of senior managers and organizations representing the Board’s front-line staff deemed Robb’s ideas an “existential threat” aimed to destroy the NLRB from the inside. A group of NLRB associate regional directors indicated the potential moves have caused general anxiety Agency-wide and have noticeably hurt morale in the field.

To increase efficiency due to possible budget cuts and a decline in the number of cases handled by the NLRB, Robb proposed eliminating or combining certain field offices, eliminating the senior executive status of the regional managers, and shifting more decision-making to the Board’s office in Washington, D.C., among other changes. Further, Robb has proposed for review by NLRB employees 59 ideas to overhaul how unfair labor practice complaints are processed and how union elections are handled. Some of the ideas include: shorter investigation times, strict time limits on responses before dismissal, and entrusting investigators with authority to dismiss cases, approve settlements, or withdraw a union’s complaint without regional director approval.

The groups responding to Robb agree with some of his proposals (including placing an emphasis on early resolution of unfair labor practice complaints through settlement), but fear the majority of Robb’s ideas will “contravene” the mission of the NLRB. The regional directors stressed Robb “reread” the opening section of the National Labor Relations Act. The NLRA establishes that the mission of the NLRB is to protect workers’ rights and encourage collective action by overseeing union elections and adjudicating unfair labor practice complaints.

While the business and management community has supported Robb’s proposals, NLRB employees have sought congressional intervention over concerns about a hiring freeze and other cost-saving measures introduced by Robb and NLRB Chairman Marvin Kaplan. The union representing NLRB workers has indicated Robb and Kaplan incorrectly based their cost-cutting measures on White House budget requests, instead of actual funding provided by Congress. As expected, Robb’s proposed changes have been met with opposition from Democratic lawmakers and worker advocates. A recent letter from 56 retired regional directors also opposed Robb’s reorganization proposals for field offices.

Employers should keep an eye on these developments, as they may significantly impact how NLRB matters are going to be handled. The emphasis on settlement could result in NLRB agents applying earlier and greater pressure on charged parties to settle or being more willing to be flexible in settlement discussions. If you have any questions on this developing story, please feel free to contact the Jackson Lewis Labor and Preventive Practices attorney with whom you work.

Browning-Ferris Back in the Spotlight … and at the Court of Appeals?

The drama involving the National Labor Relations Board’s precedent-busting 2015 joint employer decision continues.

Browning-Ferris Industries of California, Inc., 362 NLRB No. 186 (2015), dramatically changed the playing field for employers who rely on nontraditional workforces. The NLRB transformed its prior joint employment standard in Browning-Ferris into a two-part test that permits a finding of joint employer where “control” is direct, indirect, or even a reserved right to control, whether or not that right is ever exercised.

As with any hotly contested decision, the parties appealed Browning-Ferris to the U.S. Court of Appeals for the District of Columbia Circuit and participated in oral argument on March 9, 2017. However, before the Court of Appeals could issue a decision, the Board handed down Hy-Brand Industrial Contractors, Ltd., 365 NLRB No. 156 (Dec. 14, 2017), which expressly overruled Browning-Ferris.

Five days after issuing Hy-Brand, the Board petitioned the Court of Appeals to remand Browning-Ferris to the Board for reconsideration in light of its new precedent. The Court granted the Board’s request the same day. On January 4, 2018, Intervenor, Teamsters Local 350 asked the Court to reconsider its decision to remand, raising procedural arguments, and asserting that Board Member William Emanuel should have recused himself from the Hy-Brand decision because his former law firm represented one of the employers involved in the Browning-Ferris proceedings. The Court denied the Teamster’s Motion without comment. Most Board watchers thought that would be the end of the Browning-Ferris litigation.

Wrong.

On February 26, a three-member Board panel consisting of Chairman Marvin Kaplan and Members Lauren McFerran and Mark Gaston Pearce, vacated Hy-Brand based on a report issued by the NLRB’s Inspector General finding that Emanuel should have recused himself from participation in deciding Hy-Brand. The Order resulted in “the overruling of the Browning-Ferris decision . . . [being] . . . of no force or effect.”

Now that Browning-Ferris lives again, the Board has asked the Court to reconsider it.

It is widely anticipated that the Court will grant the Board’s request and reconsider the merits of the Browning-Ferris appeal; however, while less likely, the Court may issue a decision on Browning-Ferris soon. Once fully constituted with a Republican majority, the Board inevitably will overturn Browning-Ferris again and trigger another request to remand Browning-Ferris to the Board.

We will continue to monitor this matter and will keep you apprised as the Court (and the Board) considers the fate of Browning-Ferris.

Changes

The song “Changes,” written by Phil Ochs, provides an opportune prism to examine the arguably cataclysmic changes implemented and portended by the new employer-friendly majority at the NLRB at the end of 2017 and expected in 2018.

 

Sing along, enjoy the lilt.

Don’t cry o’er case law that’s spilt.

 

Come sit by my side, come as close as you care

The changes at the Board are not a bunch of hot air.

Abandoning Obama-era rules and decisions

An end-of-year new 2017 majority made long-awaited incisions.

 

The old majority’s reasoning, arguably murky, gray and unsound

Caught in a carousel of time coming way around

On a new Board direction the new majority rearranged.

With a different perspective, making a few bold long-needed changes.

 

Indeed, changes came swiftly, introducing 2018

With decisional speed like we’ve never seen.

Righting some of the balance between labor and management

Tossing the old and making new precedent.

 

The Trump Board majority clearly set its sights

To restore employer pre-election free speech rights

To rescind or at least adjust the “Quickie Election Rule”

That the Obama Board adopted to give unions a tool

To speed up elections and postpone key questions

To rush the vote by employees in disputed elections.

 

We bid adieu to the extent of organizing a micro-unit.

No more requiring “overwhelming” communities of interests to nullify it.

No longer can unions organize on what they can get

Employees will have a larger, more inclusive electorate.

 

Remember having to revise policies and rules in employee handbooks?

The new Board majority made clear it was giving Obama Board rulings further looks.

The new Board said to balance management’s needs and purposes in its sights

Rather than looking solely at theoretical effects of neutral rules on Section 7 rights.

 

Be respectful in conduct, cut profanity, or make civility your rule

Became fine in a handbook or Facebook, Twitter or other social media tools.

No longer do employers have to accept inappropriate conduct

No longer do they have to apply a vague protected Section 7 construct.

 

A new joint employer standard (no pun intended, I attest)

Actual “direct control,” not indirect, was made the joint employer test.

The end-of-year Board moved first, and then a new 2018 Board moved again.

To nullify the direct control decision with the stroke of a pen.

But direct control will be back no doubt

A 2018 Trump Board on this issue surely will win out

 

The new Board General Counsel wants his Division of Advice

To review ULP charges that challenge Obama-Board rulings, many, not just a few will suffice

More Obama-Board cases will reach the Board for decision

So precedent can change and move with precision.

 

When sexual harassment investigations need confidentiality

The GC and the Board will introduce a dose of reality

To allow proper exams of workplace misconduct

And protect investigatory privacy from flowing out a viaduct.

 

In the public sector

There will be a new vector

Limiting union dues and fees that are mandatory

Freeing employees’ pocketbooks, writing a new story.

 

These are reasonable expectations from the new and then-newer Board Members

Growing from fires of a swinging pendulum’s embers.

Keep tabs on employee dissatisfaction

And take lawful preemptive action.

By taking care

Not to be caught unaware.

It’s not a dream

In 2018.

NLRB Vacates Hy-Brand Joint Employer Decision Following Inspector General Report

In a surprising reversal, the NLRB on February 26, 2018, vacated its decision in Hy-Brand Industrial Contractors, Ltd., 365 NLRB No. 156 (2017), and restored the Board’s union-friendly joint employer test set forth in Browning-Ferris Industries, 362 NLRB No. 186 (2015) which Hy-Brand had overruled.

The Board’s latest reversal came about as a result of a report from the Board’s Inspector General that Member William Emanuel should have recused himself from participating in the Hy-Brand decision. Emanuel’s former law firm, Littler Mendelson P.C., represented one of the joint employers involved in the Browning-Ferris decision. The Inspector General found that because Hy-Brand amounted to a “do over” for Browning-Ferris, which is still pending before the Board, Emanuel should not have participated.

Prior to 2015, the Board analyzed whether two employers were joint employers using a test that required that an entity must actually exercise direct and immediate joint control over essential employment terms and conditions of employment (such as hiring, firing, disciplining, or supervising employees) of employees at the separate entity, as opposed to merely reserving the right to exercise control, to be a joint employer. Limited and routine control (such as simply telling employees what work to perform, but not how or when to perform it) did not suffice.

In 2015, the Board reversed decades of joint employer precedent in Browning-Ferris. Under the new standard announced in that decision, the Board found that two or more statutory employers are joint employers of the same employees if they share or codetermine matters governing the essential terms and conditions of employment. The Board decided that indirect and reserved control would suffice. Thus, an employer that merely possessed the right to control the essential terms and conditions of employment for employees at another entity could be a joint employer – even if the alleged joint employer never exercised that control.

The matter appeared settled when the Board overruled Browning-Ferris in Hy-Brand. But the Board’s Inspector General found that the deliberations behind Hy-Brand, which included substantial re-analysis of Browning-Ferris, amounted to a “continuation of the Board’s deliberative process in Browning-Ferris” and thus should have precluded Emanuel’s involvement.

The Board is currently composed of two Democratic and two Republican appointees. President Donald Trump’s nominee for the vacant fifth seat, John Ring, has yet to be voted out of committee. (A hearing before the Senate Health, Education, Labor and Pensions Committee is scheduled to take place on March 1.) While the Inspector General made clear in his report that only the “very specific facts” of this matter required the recusal of Emanuel, the Board likely will take a more deliberative approach before issuing another joint employer decision.

 

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