The National Labor Relations Board (NLRB) has ruled an employee’s effort to decertify his union could proceed, despite a previous agreement between the employer and union extending the time during which decertification petitions are barred. Pinnacle Foods, 368 NLRB No. 97 (Oct. 21, 2019).  

An employee filed a petition to decertify his union after the expiration of the “certification year,” the period during which the parties cannot challenge a union’s majority status. However, as part of a settlement of pending unfair labor practice charges, the employer and union had agreed (without the employee-petitioner’s consent) to extend the certification year by seven months. An NLRB regional office dismissed the decertification petition because it was filed during the seven-month extension period.

Reversing the dismissal, the NLRB allowed the decertification process to continue. Citing TruServ Corp., 349 NLRB 227 (2007), the Board held that where there is no finding of a violation of the National Labor Relations Act or an admission by the employer of a violation, there is no basis for dismissing a petition “based on the settlement of alleged but unproven unfair labor practices.” Here, the settlement agreement contained a non-admission clause and, as a result, there was no “basis for finding that the alleged unfair labor practices tainted the petition.”

The NLRB also held that “the processing of the petition … may not properly be held in abeyance simply because the Employer and the Union have agreed to an extension of the certification year …. [A] decertification petitioner cannot ‘be bound to a settlement by others that has the effect of waiving the petitioner’s right under the Act to have the decertification petition processed.’”

Please contact a Jackson Lewis attorney with any questions about this case or the NLRB.

 

Unpaid interns are not “employees” as defined by the National Labor Relations Act (NLRA), and employee advocacy on their behalf is not protected concerted activity under Section 7 of the NLRA, the National Labor Relations Board (NLRB) has ruled. Amnesty International of the USA, Inc., 368 NLRB No. 112 (Nov. 12, 2019).

The NLRB also concluded the employer’s expression of frustration and disappointment with its employees’ actions on behalf of the interns was not an unlawful implied threat.

Background

Amnesty International is a nonprofit advocacy organization that typically hires 15 unpaid interns to volunteer each academic semester.

In February 2018, a group of interns, assisted by an employee, circulated a petition requesting the organization pay them for their volunteer work. Nearly all the organization’s employees signed the petition. At the same time, the organization’s executive team was considering a paid intern program with only three interns.

On April 2, 2018, unaware of the unpaid intern’s petition, the Executive Director of the organization shared the organization’s plans for a paid internship program during an employee meeting. The unpaid interns sent their petition to the Executive Director the next day.

On April 9, 2018, the Executive Director held separate meetings with the current interns and the employees who signed the petition to announce plans to implement the paid internships that fall. The employees reacted negatively and expressed concern about the reduced number of interns. The Executive Director stated that she was disappointed the employees did not take advantage of the organization’s open-door policy to discuss the matter with management before using a petition. The Executive Director also stated that she viewed the petition as adversarial and felt it threatened litigation.

On May 9, 2018, the employee who assisted the unpaid interns with their petition met privately with the Executive Director. The employee recorded the conversation. The Executive Director stated she was “very embarrassed” that her employees felt unable to approach her about the issue and “disappointed that she did not ‘have the kind of relationship with staff’ that she thought she had.” The Executive Director said that it would have been “really helpful” to know about the intern’s interest in paid internships in advance and that the employee could have told the interns to “give me a heads-up to let me know it’s coming.” The Executive Director indicated that a petition “sets off a more adversarial relationship” and is not effective when the demand could “be met without applying that pressure.” She further stated, “you could try talking to us before you do another petition.”

Administrative Law Judge Decision

After a trial, ALJ Michael A. Rosas held that the employees had engaged in protected activity under Section 7 of the NLRA by joining the interns’ petition. He also determined the organization violated Section 8(a)(1) of the NLRA by: (1) instructing employees to make complaints orally before making them in writing; (2) threatening unspecified reprisals because of the employees’ protected concerted activity; (3) equating protected concerted activity with disloyalty; and (4) requesting employees to report to management other employees who are engaging in protected concerted activity. He dismissed the allegation that the Executive Director’s statements “impliedly threatened to increase employees’ workloads as a result of the petition.”

NLRB Decision

The NLRB reversed the ALJ’s conclusions and dismissed the complaint.

Holding that “[a]ctivity advocating only for nonemployees is not for ‘other mutual aid or protection’ within the meaning of Section 7,” the NLRB reasoned that the unpaid interns were not employees because they did not “receive or anticipate any economic compensation from [Amnesty International].”

The NLRB also held that the Executive Director’s statements did not coerce the employees. It concluded the Executive Director’s statements fell within Section 8(c) of the NLRA, which permits employers to express views, arguments, or opinions that are not accompanied by coercion (e.g., threats or promises of benefits). Considering the timing of the petition and the employees’ reaction, the NLRB determined that the Executive Director’s “opinions about how to handle petitions in the future to be, at most, suggestions, rather than commands or even direct requests.” Her statements “clearly expressed her frustration that, as a result of the lack of communication, management’s attempt to provide a positive response to the … petition had instead resulted in a backlash from employees.” However, the comments did not rise to the level of conveying anger, threaten reprisal, or accuse the employees of disloyalty, the NLRB ruled. Therefore, it concluded they did not violate Section 8(a)(1) of the NLRA.

***

The NLRB has been signaling a hesitancy to impose obligations on employers outside the traditional employment context. It has proposed exempting paid undergraduate and graduate students from the NLRA, for example. Over the last several years, as employers are forced by the low employment rate to increase their use of nonemployees, unions have increased their efforts to expand the NLRA’s reach by organizing non-traditional workers, including temporary campaign workers and graduate students.

Please contact a Jackson Lewis attorney with any questions about this case or the NLRB.

The National Labor Relations Board has issued its “Ethics Recusal Report,” which announces several process changes that may add new wrinkles to practice before the Board.

Much of the Report, dated November 19, 2019, is minutiae and insider information regarding existing methods of identifying ethical conflicts.

In 2018, the NLRB faced a high-profile ethical crisis. The Board vacated a significant decision, Hy-Brand Industrial Contractors, Ltd., 366 NLRB No. 93 (2018), in which it overruled Browning-Ferris, 362 NLRB No. 186 (2015), and reinstated the previous, more employer-friendly, test for determining joint employer status. The Board vacated the decision after a finding by the NLRB’s Designated Agency Ethics Official that NLRB member William Emanuel should have been disqualified from participating in the proceeding.  Although the circumstances were uncommon, and initially cleared Board conflict check mechanisms, the controversy was an embarrassment for the Board. Chairman John Ring ordered a thorough review, resulting in issuance of the Report.

The Report details little-known Board processes, such as the maintenance of “recusal lists” cataloguing companies whose cases are subject to recusal for each Board member. The NLRB’s Executive Secretary examines these non-published lists before assigning every case. To promote transparency, the Board shortly will issue a protocol requiring public disclosure of these lists. Time will tell whether publication of the lists will encourage increased recusal motions and related litigation.

Recommendations that a member recuse him or herself are not self-enforcing. Individual Board members decide whether to recuse themselves from a particular case. In Ring’s view, this cannot be changed. The NLRB is developing consistent procedures and protocols for handling recusal motions.

The Board also is preparing a rule that all parties must file (and subsequently update) an Organizational Disclosure Statement (ODS) at the outset of a matter. These filings will be used to improve the reliability of the recusal lists. The new rule (based on federal civil litigation rules), at a minimum, will require employers to identify corporate parent entities and all publicly-held corporations owning at least 10 percent of its stock. Unions will be required to identify their parent or subsidiary entities.

While the form of the (ODS) has not been made public, it is probable the Statement must be filed promptly. In representation cases (those generally involving unions attempting to represent an employer’s employees), that likely means filing at the same time the employer’s “Statement of Position” is filed – within seven days after the union has filed its representation petition at the NLRB.

The Report does not address ODS enforcement mechanisms or the penalty for non-compliance. Currently, NLRB procedure requests vague pro forma corporate information to establish its jurisdiction to adjudicate a particular case. Accurately reporting data on interrelated companies may require participation by the employer’s corporate legal department. Concerns include the potential for increased allegations of joint employer status or expanded unfair labor practice exposure to related corporate entities.

In the Report, the Chairman also ordered improved ethics training, including a checklist of uncommon conflict situations developed by the agency’s Designated Agency Ethics Official.

We will revisit these issues and new rules and requirements after they are issued. If you have any questions about this article or the NLRB, please contact a Jackson Lewis attorney.

An employee who paid “fair share” union fees under protest is not entitled to damages to refund any of the money he paid the union, the U.S. Court of Appeals for the Seventh Circuit has held. Janus v. Am. Fed’n of State, No. 19-1553 (Nov. 4, 2019). The Court explained fair share fees were “an exchange of money for services” that was permitted under the law in effect at the time they were deducted from the employee.

The Court also applied its reasoning to Mooney v. Ill. Educ. Ass’n, No. 19-1774 (Nov. 5, 2019), a case in which the employee sought restitution, rather than damages. It concluded, in substance, that claim also was for damages.

Background

Mark Janus was a Child-Support Specialist at the Illinois Department of Healthcare and Family Services. American Federation of State, County and Municipal Employees, Council 31, AFSCME was the exclusive representative of Janus’s employee unit. Janus exercised his right not to join the union and objected to the $44.58 in fair share fees that was deducted from his paycheck each month.

Janus brought a case arguing that the National Labor Relations Act’s compulsory fair share scheme violated the First Amendment and that the Supreme Court’s Abood v. Detroit Board of Educ., 431 U.S. 209 (1977), should be overturned. The Supreme Court agreed and overruled Abood. Janus v. AFSCME, Council 31, 138 S. Ct. 2448 (2018). In Abood, the Supreme Court upheld a Michigan law authorizing public sector unions and government employers to use agency-shop agreements (which allowed charging employees a fee for union representation even though they objected to becoming union members). The high court in 2018 held these “fair share fees” were constitutional “insofar as [they] are applied to collective-bargaining, contract administration, and grievance-adjustment purposes.” (For more on that decision, see our article, Supreme Court Rules Unconstitutional Mandatory Fees Imposed on Non-Union, Public Sector Employees.)

7th Circuit Decision

Janus followed up on the Supreme Court’s 2018 decision with a request for damages from AFSCME pursuant to 42 U.S.C. § 1983. Section 1983 supports a civil claim against “every person who, under color of any statute … of any State … subjects, or causes to be subjected, any citizen of the United States … to the deprivation of any rights, privileges, or immunities secured by the Constitution and laws.” The District Court granted summary judgment to AFSCME and the Seventh Circuit upheld its decision.

The Seventh Circuit Court considered several issues in reaching its conclusion, including whether the Supreme Court’s Janus decision was retroactive, if the requirements under § 1983 were met, and whether AFSCME had a good-faith defense. The Court concluded that § 1983 was satisfied, finding AFSCME was a “person” that could be sued and that it acted under the color of state law. In addition, the Circuit Court explained that the Supreme Court did not specify whether its decision was retroactive, noting that retroactivity “poses some knotty problems.” Ultimately, the Circuit Court decided to assume retroactivity “for the sake of argument.”

Finally, the Court analyzed “to what remedy or remedies” was Janus entitled. It clarified the retroactive application was not determinative of what, if any, remedy could be obtained. The Court explained that the Supreme Court has acknowledged the retroactive application of a new rule of law does not foreclose the opportunity to raise “reliance interests entitled to consideration in determining the nature of the remedy that must be provided.” Accordingly, the Court considered whether AFSCME was entitled to a good-faith defense to the relief sought by Janus.

The Seventh Circuit, joining its sister circuits, concluded there was a good-faith defense in § 1983 actions when the defendant reasonably relied on established law. The Court held AFSCME had a legal right to receive and spend fair share fees collected from nonmembers if it complied with state law and Abood and it did not demonstrate bad faith when it followed these rules.

Implications

This decision demonstrates the current trend on the fair share fees damages issue. According to the Seventh Circuit, every district court that has considered the question whether there is a good-faith defense to liability for payments collected prior to the Supreme Court’s decision overruling Abood has answered affirmatively.

Please contact a Jackson Lewis attorney with any questions about this case.

An employee’s complaints about his pay to coworkers was protected concerted activity under the National Labor Relations Act (NLRA), even though the employee was unsuccessful in enlisting any other employees to support his complaints, the Advice Division of the National Labor Relations Board’s (NLRB) Office of the General Counsel has decided.

Therefore, the NLRB found the employee’s termination for his wage complaints violated the NLRA and instructed the Regional Director for Region 14 to issue an unfair labor practice complaint on the employee’s unfair labor practice charge. Gallup, Inc., 14-CA-234530 (July 24, 2019, released Oct. 18, 2019).

Background

The employee was a quality assurance (QA) coordinator. When Gallup reclassified its QA employees from “exempt” to “non-exempt,” the employer reduced their base salary by $7,000 because the reclassified QA employees were newly entitled to overtime pay. The employer informed the employees that if they worked the same hours they had been working before, their overtime pay would make up for the lower base and equal the same amount they had earned as exempt employees.

Unhappy about the change, the employee raised the issue on several occasions with his QA coworkers and supervisors. Some employees agreed with the employee, but most responded that the new pay structure could be an improvement. Some who agreed with the employee later left the company or transferred to different teams.

Following a November companywide meeting, the employee raised the pay issue with the employer’s management. They informed the employee that a coworker had told them about the employee’s pay complaints to coworkers. They told the employee that he “need[ed] to be accepting of his pay and that he shouldn’t complain about not being paid enough.”

The employee asked employees in other departments about available jobs. The employee’s manager questioned why he was talking to employees on other teams. When the employee objected to the question, his manager emphasized that he wished the employee had come to him first, that the company was not for everyone, and that it would be okay if the employee went to work somewhere else if the employee was unhappy.

The employee subsequently was terminated and was told, “[W]e know you are not happy here. You’re disengaged. You’re not happy and you’ve been talking about your pay to other people. Today will be your last day.”

The employee filed an unfair labor practice charge with the NLRB’s Region 14 office alleging the termination and the supervisors’ statements violated the NLRA. The Region 14 Regional Director referred the allegations to the Advice Division for assistance in deciding whether the allegations set forth violations of the NLRA.

Advice Division Decision

The Advice Division decided the termination violated the NLRA. Citing the “test” under the Board’s Meyers Industries decisions for determining whether activity is concerted, the Advice Division explained, “In general, to find an employee’s activity to be ‘concerted,’ we shall require that it be engaged in with or on the authority of other employees, and not solely by and on behalf of the employee himself.” It also explained that individual employees act concertedly where they “seek to initiate or to induce or to prepare for group action.” Meyers Industries, 268 NLRB 493 (1984); Meyers Industries, 281 NLRB 882 (1986).

The Advice Division distinguished the facts in the case from those in Alstate Maintenance, 367 NLRB No. 68 (Jan. 11, 2019). The Alstate employee’s complaints about a customer’s tip practices was not protected activity and, therefore, his termination for making those complaints did not violate the NLRA. There, the NLRB held that a single statement about one customer’s tip history, although said in the presence of other employees (in a meeting), was a mere gripe not intended to induce group action about a workplace concern. The tip comment also was not for the purpose of “mutual aid or protection” (a necessary element for a finding of protected concerted activity), because the employer had no control over the customer’s tip practice (and, therefore, could not remedy the employee’s complaint).

Unlike in Alstate, the employee’s conduct in the present case was for mutual aid or protection because it concerned the pay structure, pay amount, and hours of work requirements maintained by the employer and over which it had full control.

The Advice Division wrote:

Although the Charging Party was met with at most only passive agreement from coworkers rather than willingness to join him in seeking concrete action, the lack of “fruition” in his campaign to solicit employees’ support for his complaints against a new system d[id] not nullify the concertedness of the conduct.

Finally, the Advice Division found that it was clear the employee’s protected concerted discussions about pay and hours contributed to the termination decision; the employer specifically listed “talking about his pay to other people” as a reason for discharge.

The Advice Division concluded, “[N]otwithstanding the lack of success, the employee’s ongoing complaints to fellow employees about their pay was protected concerted activity and thus the employee’s discharge for that conduct violated Section 8(a)(1) of the Act.”

Regarding the statements, the directive to the employee to stop discussing his pay also was a violation of the NLRA, the Advice Division found. The statement that the employee should leave the company if he was not happy was not a violation, however, because that statement was made in response to the employee’s complaints about his own pay. Even assuming that statement may be taken as a veiled threat, the Advice Division explained, it was not unlawful because it was not in response to protected concerted activity and did not direct the employee to stop engaging in protected concerted activity.

In a footnote, the Advice Division urged the NLRB to overturn a line of cases arguably conflicted with the Meyers standard and in which the Board deemed statements about certain subjects “inherently” concerted. The NLRB previously has indicated its interest in revisiting this concept, but it has not yet been presented with a case in which the inherently concerted issue is raised. Citing Alstate, the General Counsel advised the Regional Director not to follow this “inherently concerted” theory of a violation of the NLRA.

***

This Advice Memorandum illustrates that proper identification of protected concerted activity requires a detailed and fact-specific analysis. Employers are well-advised to weigh employment decisions that may involve more than one employee and protected topics carefully and to consult experienced labor counsel when necessary.

Please contact a Jackson Lewis attorney with any questions about this Advice Memorandum or the NLRB.

An arbitration agreement requiring that all “claims or controversies in any way relating to or associated with … employment or the termination of … employment … will be resolved exclusively by binding arbitration,” including “all statutory… claims” violated the National Labor Relations Act (NLRA), the National Labor Relations Board (NLRB) has ruled.

The Board, applying Boeing Co., 365 NLRB No. 154 (2017), found that the agreement made arbitration the exclusive forum for the resolution of statutory claims under the NLRA, which violates the NLRA. Cedars-Sinai Medical Center, 368 NLRB No. 83 (Sept. 30, 2019). The Board categorized the agreement as a Category 3 policy under Boeing. (For more on Boeing and its category approach to employer rules, see our articles Labor Board Sets New Standard for Determining Lawfulness of Facially Neutral Workplace Rules and Labor Board Clarifies Boeing Work Rules Decision, Finds Confidentiality, Media Contact Rules Lawful).

The Board rejected the employer’s defense that the agreement’s “savings clause,” which provided that the agreement “does not apply to . . . claims . . . that are preempted by federal labor laws,” was sufficient to communicate to employees that claims under the NLRA were not covered. Citing Prime Healthcare Paradise Valley, LLC, 368 NLRB No. 10 (2019), where the Board also held an arbitration agreement unlawfully prohibited the filing of claims with the NLRB, the Board noted that:

[v] ague savings clauses that would require employees to “meticulously determine the state of the law” themselves are likely to interfere with the exercise of NLRA rights. Such clauses include, for example, those stating that “nothing in this agreement shall be construed to require any claim to be arbitrated if an agreement to arbitrate such claim is prohibited by law,” that exclusively require arbitration limits that requirement to circumstances where a claim “may lawfully be resolved by arbitration.”

The Board held that the phrase “preempted by federal labor laws” was vague and that an “objectively reasonable employee … reading this vague language would not divine an implicit intent to exclude claims arising under the Act.”

The Board contrasted that savings clause with the one in the arbitration agreement under review in Briad Wenco, 368 NLRB No. 72 (2019). The savings clause there stated: “Nothing in this Agreement shall be construed to prohibit any current or former employee from filing any charge or complaint or participating in any investigation or proceeding conducted by an administrative agency, including but not limited to … the National Labor Relations Board ….”

In addition to its determinations regarding the lawfulness of the arbitration agreement, the Board also held that the company’s action for declaratory judgment in state court did not violate the NLRA. In light of the U.S. Supreme Court’s decision in Epic Systems, 138 S.Ct. 1612 (2018), the Board held that the company could lawfully seek to compel individual, rather than class, arbitration through a complaint in state court.

***

Employers should evaluate whether their arbitration agreements clearly inform employees of their right to file charges with the NLRB. Employers should not rely on a vague savings clause to communicate to employees that employees still can file unfair labor practice charges at the NLRB.

Please contact a Jackson Lewis attorney for questions about this case, the NLRB, or assistance in implementing or reviewing an employee dispute resolution program.

The National Labor Relations Board (NLRB) has held that an employer did not violate the National Labor Relations Act (NLRA) when it unilaterally changed retirees’ medical benefits without first negotiating with the unions that represented its employees. E.I. Du Pont De Nemours and Co., 368 NLRB No. 48 (Sept. 4, 2019).

The NLRB found the unions waived their right to bargain over those changes. Chairman John Ring and Member Marvin Kaplan were in the majority, while Member Lauren McFerran dissented.

Background

E.I. Du Pont De Nemours and Company manufactures synthetic fibers and related products at facilities throughout the United States. DuPont maintained company-wide employee benefit plans for all its employees and retirees. Although DuPont informed the unions it would negotiate separate plans for union-represented employees, the unions consistently agreed to participate in the company-wide plans.

DuPont’s company-wide benefit plans contained “reservation-of-rights” provisions, which allowed the company to retain the right to suspend, modify, or terminate the benefit plan at its discretion. The unions accepted DuPont’s plans with the reservation-of-right provisions. The collective bargaining agreements (CBAs) with each union also contained similar reservation-of-rights provisions, which recognized DuPont’s right to make unilateral changes to the benefit plans, subject to certain restrictions in the CBAs and the benefit plan documents.

In 2013, DuPont made unilateral changes to its company-wide Dental Assistance Program and Medical Care Assistance Program retirement benefit plans that affected coverage for some of DuPont’s retirees and their covered dependents. One of the conditions on which the company had offered, and the unions had accepted, the unit employees’ participation in dental and medical care assistance programs was that DuPont reserved the right to make changes to the plans or to terminate the programs entirely. Exercising that right, DuPont had made numerous unilateral changes to the programs, without objection by the unions. This time, however, the unions objected and filed unfair labor practice charges with the NLRB alleging the changes were unlawful. DuPont defended against the charges, arguing that the union had “clearly and unmistakably” waived its right to bargain over the changes. An unfair labor practice complaint was issued and sent to trial before an NLRB Administrative Law Judge (ALJ).

Administrative Law Judge Decision

After a trial, ALJ Michael A. Rosas held the unions did not clearly and unmistakably waive their bargaining rights because nothing in the CBAs shows they gave up their rights to bargain over benefit changes. He also noted that the CBAs did not reference the plans.

Board Decision

The Board found that, while retiree healthcare benefits for active bargaining-unit employees is a mandatory subject of bargaining under the NLRA, the unions waived their right to bargain over these changes. Contrary to the ALJ, the Board found the contract language and the parties’ bargaining history and past practice, taken together, demonstrated the unions clearly and unmistakably waived their right to bargain over the changes.

Regarding contract language, the Board found that contractual references to a benefit plan that contains reservation-of-rights language, like those here, can support a finding of waiver, even if the reference would be insufficient, standing alone, to establish waiver.

The Board also found that bargaining history supported a finding that the unions waived their right to bargain over the changes. The unions had agreed to participate in the various plans without bargaining after opposing the plans during collective bargaining and, therefore, “consciously yielded” its position that bargaining should occur. Finally, past practice — numerous unilateral changes made to the old plans without bargaining and without objection from the unions — supported the waiver finding.

Based on these factors, the Board found that the unions had clearly and unmistakably waived their right to bargain over the changes. Accordingly, the Board dismissed the unfair labor practice charges.

***

Since this case was decided, in MV Transportation, Inc., 368 NLRB No. 66 (Sept. 10, 2019), the NLRB adopted a new contract coverage standard as the primary standard for determining whether an employer had an obligation to bargain before implementing a change (see our article, Labor Board Adopts ‘Contract Coverage’ Standard in Unilateral Change Cases, Overturns Precedent). Nevertheless, if appropriate, employers should still argue that an obligation to bargain over a change did not exist because the union clearly and unmistakably waived its right to bargain over the change. Under MV Transportation, the clear and unmistakable waiver test applies if the Board does not find the unilateral changes are allowed under its new contract coverage standard.

Please contact a Jackson Lewis attorney with any questions about this case or the NLRB.

A wildcat strike was not protected by the National Labor Relations Act (NLRA) once the striking employees became aware that their union disapproved of and disavowed the strike, the National Labor Relations Board (NLRB) has ruled. CC1 Limited Partnership d/b/a Coca Cola Puerto Rico Bottlers, 368 NLRB No. 84 (Sept. 30, 2019).

The employees’ continued striking, despite their union’s opposition, undermined the union’s exclusive bargaining authority and resulted in a loss of the NLRA’s protections, the NLRB explained.

Chairman John Ring, and Members Marvin Kaplan and William Emanuel participated in the decision.

Facts

A Teamsters Local represented warehouse employee at the company’s bottling plant. In September 2008, during negotiations for a successor collective-bargaining agreement, the union’s main representative at the plant and several shop stewards led employees in a two-hour work stoppage. The company suspended and then terminated the shop stewards.

On October 20, the first day of a strike led by the terminated stewards, the company’s counsel warned the union’s Secretary Treasurer, that it would take action against “the Union and its representatives” unless the illegal strike stopped. The union replied on the same day, making it “abundantly clear that [it] did not send or authorize the presence of Officers or Union members to take part in the strike.” The union stated in its letter that the strikers “were in violation of the statutes of the Union” and engaged in “clearly illegal activity.” The union assured the company that it would “be taking legal and union action” against the “false [union] leaders” who were “threatening … the welfare of the great majority of these workers in order to promote their own ignoble interests.”

The company had its security guards distribute copies of the union’s letter to the striking employees. However, most employees continued to strike for two more days, through October 22. The company ultimately suspended or discharged 86 of the strikers.

2015 Board Decision

The dispute first reached the Board in 2015. The Board decided the strike was protected by Section 7 of the NLRA and that the company unlawfully suspended and discharged the striking employees. CC1 Limited Partnership d/b/a Coca Cola Puerto Rico Bottlers, 362 NLRB No. 125 (June 18, 2015).

The NLRB applied Silver State Disposal Service, 326 NLRB 84 (1998). In that case, the Board developed a two-part test to determine whether a wildcat strike is protected: (1) whether the employees attempted to bypass their union and bargain directly with the employer; and (2) whether the employees’ position was inconsistent with the union’s position.

In ruling the company violated the law, the NLRB assigned little significance to the union’s October 20 strike disavowal letter, because it was the company that had distributed it to the striking employees.

D.C. Circuit Remand

The company appealed the decision to the U.S. Court of Appeals for the District of Columbia. CC1 Ltd. P’ship v. NLRB, 898 F.3d 26 (D.C. Cir. 2018). The Court remanded the case to the NLRB for further explanation of its conclusion that the wildcat strike was protected activity, focusing on the October 20 letter.

2019 Board Decision

Regarding the October 20 letter, the Board found that “[t]he mere distribution of the letter by the security guards cannot negate employees’ knowledge of the Union’s disavowal of the strike and legitimate their conduct in derogation of the Union’s position.” This was especially true, the Board said, because there was no evidence that the notification to the strikers was the result of manipulation or fraud, or that the third-party messengers engaged in misconduct, intimidation, or other coercion in distributing the flyers.

The Board noted that the letter was “facially bona fide” and, “under the circumstances surrounding the strike[,] amply sufficed to establish to the strikers that their Union opposed the strike.” (The Board also found significant the conspicuous absence of union leadership who supported or participated in the strike or conducted or attended the meeting at which the strike vote took place.)

The employees’ continued striking after the letter’s distribution was not protected by the NLRA, the Board ruled. The Board did not apply Silver State. Instead, it applied Emporium Capwell Co. v. Western Addition Community Organization, 420 U.S. 50 (1975), where the U.S. Supreme Court held that a strike is not protected if it is an attempt to engage in separate bargaining from the striking employees’ union and interferes with the union’s exclusive bargaining representative status. the NLRB dismissed the challenges to the strikers’ suspensions and discharges. (In a footnote, the NLRB “question[ed] whether the standard set forth in Silver State Disposal for determining whether an unauthorized strike is protected is consistent with the principles of Emporium Capwell Co.”)

***

This decision is an example of the Trump Board’s efforts to clarify the standards with which employers must comply in protecting their businesses from overreaching activity by employees, non-employees and union representatives. (For another example, see our article, NLRB Strengthens Property Rights, Employers May Limit Off-Duty Access by Contractors’ Employees.)

If you have any questions about this decision or the NLRB, please contact a Jackson Lewis attorney.

National Labor Relations Board Chairman John Ring has again informed Democratic leaders of the U.S. House of Representatives Committee on Education and Labor that the Agency will not release documents they requested related to NLRB members’ recusals from Board cases.

On August 15, 2019, Bobby Scott, D-Va., Chairman of the House Committee on Education and Labor, and Frederica Wilson, D-Fla., Chairwoman of the House Subcommittee on Health, Education, Labor and Pensions, again requested documents related to Board members’ conflicts of interest. The document requests originally were made on May 6, 2019, and were responded to on May 23, June 5 and 21. Ring did not give the Committee all of the requested documents, however.

In their August 15, 2019, request, the Committee again asked for: memoranda from the NLRB’s ethics official (who makes determinations on members’ recusals from certain cases); updated lists of cases in which Board members could not participate; documents relating to the “appropriateness” of members’ participation in a certain matter; and an update on the ethics review announced by the Board following its withdrawal of the ­Hy-Brand decision.

Scott’s and Wilson’s requests for NLRB ethics documents is part of House Democrats’ inquiry into the Board’s ethics standards following the NLRB’s withdrawal of its Hy-Brand decision after the Board’s inspector general determined that Member William Emanuel should have recused himself from the case due to his former firm’s representation of a party in a related case. The decision sought to overturn the Board’s Obama-era decision in Browning-Ferris, which substantially expanded the Board’s standard for determining joint-employer status.

In his September 4, 2019, response, Ring again declined to release the requested documents for several reasons. For example, he noted that the documents were “pre-decisional” and their production would violate Board norms that promote candor when evaluating potential conflicts of interest. Ring also maintained the Board’s “longstanding position” that the requested documents contained “pre-decisional” and “privileged” communications among Board members and NLRB staff that cannot be released outside the NLRB. Ring further noted that disclosure of recusal lists could “reasonably be expected to interfere with the Board’s law enforcement function” because parties may be able to claim, as a result, a denial of due process when members recuse themselves from the affected party’s case.

Although the lawmakers argued that memoranda drafted by the NLRB’s ethics official reflect his final “decisions,” Ring clarified that many “decisions” are made during the processing of a case before the members make their decision on the merits of the case. These “decisions” include the Board’s executive secretary’s determinations as to Board members’ case assignments, members’ assignments of cases to their staff attorneys, and recusal decisions. Ring reaffirmed to the Committee leaders his commitment “to transparency and to cooperating with [the Committee] regarding . . . [its] oversight responsibilities.”

As to the lawmakers’ request for an update on the Agency’s internal ethics review, Ring stated that the Agency plans to complete it this fall.

How the NLRB analyzes defenses to unilateral change unfair labor practice charges may be in for a substantial revision.

National Labor Relations Board (NLRB) Chairman John Ring and Member Marvin Kaplan have signaled their interest in reviewing the law in this area. E.I. du Pont de Nemours & Co., 368 NLRB No. 48 (Sept. 4, 2019). In footnote 13 of the decision, they expressed their intention to revisit the applicability of the “contract coverage” defense in a future appropriate unilateral change case.

Under the National Labor Relations Act (NLRA), employers have a duty to bargain in good faith with the union that represents its employees about mandatory subjects of bargaining (e.g., wages, hours, and other terms and conditions of employment). An employer’s unilateral change to a mandatory subject of bargaining without first offering to bargain with the union is a violation of the NLRA, unless the employer has a valid defense, such as the union’s waiver of the right to bargain.

An employer has a difficult burden to establish a waiver defense; it must prove the union clearly and unmistakably waived its right to bargain over the topic. This can be shown through contract language, bargaining history, and/or past practice. An employer must show the parties “unequivocally and specifically express[ed] their mutual intention to permit unilateral employer action with respect to a particular employment term, notwithstanding the statutory duty to bargain that would otherwise apply.” Provena St. Joseph Med. Ctr., 350 NLRB 808, 811 (2011). Under this standard, the Board narrowly construes waivers and has been hesitant to imply waivers not expressly mentioned in the collective bargaining agreement (CBA).

The Board in Provena applied the “clear and unmistakable waiver” standard in analyzing the employer’s defense. Then-Chairman Robert Battista dissented, writing that he would have applied a less restrictive “contract coverage” standard to the case. He explained:

Under this [contract coverage] test where there is a contract clause that is relevant to the dispute, it can reasonably be said that the parties have bargained about the subject and have reached some accord. Thus, there has been no refusal to bargain. In sum, the issue is not whether the union has waived its right to bargain. The issue is whether the union and the employer have bargained concerning the relevant subject matter. If so, the Board and the courts should honor the fruit of that bargaining.

Where the contract coverage defense is asserted in response to a unilateral change allegation, the employer would claim the change was allowed by a clause or clauses in the CBA. If the union disagreed, it would be expected to file a grievance alleging the clause or clauses did not permit the unilateral change and that the employer’s actions violated the CBA. Through the grievance process, an arbitrator would apply normal principles of contract interpretation to decide whether the contract clause or clauses were relevant to the dispute. If they are found relevant, the arbitrator would determine if the employer’s change violated the CBA.

The contract coverage defense has been adopted by some U.S. Courts of Appeal, including the D.C., First, and Seventh Circuits. If the defense is adopted by the NLRB, employers will have an easier burden to defend against unilateral change allegations.

We will report any further developments. Please contact a Jackson Lewis attorney if you have any questions about this issue or the NLRB.