NLRB General Counsel Seeks to Limit Use of Investigative Subpoenas in Unfair Labor Practice Investigations

The National Labor Relations Board’s Office of General Counsel is urging Regional Directors to limit their use of investigative subpoenas and instead issue complaints “based on the evidence available,” according to a March 13, 2019, memorandum obtained by Bloomberg Law.

The memo is General Counsel Peter Robb’s latest effort to reduce case processing time. It reiterates that charged parties are expected and encouraged to participate fully in a Region’s unfair labor practice investigation. While Regional Directors historically have issued investigative subpoenas to charged parties who refuse to cooperate, such subpoenas, according to the memo, can “unnecessarily prolong the investigation and impede the prompt resolution of the underlying dispute.”

Following Robb’s instructions, in cases where a charged party’s lack of cooperation is “significant,” Regional Directors are permitted and encouraged to issue unfair labor practice complaints based on the evidence available (provided the evidence supports the issuance of a complaint), rather than pursue additional evidence through an investigative subpoena. Whether a lack of cooperation is significant will be left to the Regional Director’s discretion and “dictated by the particular facts and circumstances of the case.” However, the memo notes a lack of cooperation could arise where the charged party fails to respond to a charge, or provides a written statement but refuses to “provide key information” requested by the Region. Although the memo does not clearly restrict a Regional Director’s determination of whether a failure to cooperate is significant, it notes that typically “failures to produce a witness or witnesses where credibility disputes may dictate issuance of complaint” will not rise to that level. Typically, these situations would not include failures to produce a witness or witnesses where credibility disputes may dictate issuance of complaint.

The Regional Director also has discretion to note the lack of cooperation in the complaint in this footnote language:

On (DATE(S)), the Region requested that Respondent cooperate in the administrative investigation of the ULP charge(s) conducted prior to issuance of the instant complaint. Respondent failed to fully cooperate in the investigation by refusing to furnish certain documents relevant to the disposition of the charge(s).

This latest memorandum highlights the importance of a party strategically considering the submission of a timely response to a Region’s request for information regarding an unfair labor practice charge. While responding may lower the risk that the Region will issue a complaint for failure to cooperate, it may result in providing too much information because, for example, the information request is overbroad. An employer that receives notification that an unfair labor practice charge has been filed against it should consult with counsel about appropriate next steps.

 

 

Labor Board: Is Union’s Inclusion of Weingarten Rights Statement in Collective Bargaining Agreement Coercive?

The National Labor Relations Board (NLRB) has remanded a 2013 decision to an administrative law judge to determine whether the Board’s landmark 2017 decision on work rules and policies affects its 2013 determination that a union did not violate National Labor Relations Act (NLRA) Section 8(b)(1)(A) by unilaterally including a Weingarten rights statement on the back cover of a collective bargaining agreement and distributing that agreement to employees. California Nurses Association, National Nurses Organizing Committee, 31-CB-012913 (Mar. 4, 2019).

In the 2013 decision, California Nurses Association, 359 NLRB 1391, the NLRB also decided the union’s unilateral action ran afoul of the NLRA’s requirement under Section 8(b)(3) of the NLRA. The Board did so based on the parties’ “clear understanding that the printed contract would not contain the Weingarten statement.”

The Weingarten Rights Statement

The Weingarten rights statement in dispute read as follows:

The Weingarten Rights

The Supreme Court has ruled that an employee is entitled to have a CNA Representative present during any interview which may result in discipline. These rights are called your Weingarten Rights.

You must request that a CNA rep be called into the meeting.

You must have a reasonable belief that discipline will result from the meeting.

You have the right to know the subject of the meeting and the right to consult your CNA rep prior to the meeting to get advice.

Do not refuse to attend the meeting if a rep is requested but denied. We suggest you attend the meeting and repeatedly insist upon your right to have a CNA rep present. If this fails, we suggest that you not answer questions and take notes.

The Section 8(b)(1)(A) issue focused on the language “You must request that a CNA rep be called into the meeting.”

Original Decision Vacated

This case has a complicated history. In 2014, the Board vacated and retained for “further action as appropriate” its 2013 California Nurses Association decision following the U.S. Supreme Court invalidating numerous Board decisions because the composition of the Board at the time of the decision included two persons whose appointments were constitutionally infirm.

In 2018, the Board reconsidered and affirmed its 2013 decision that the union’s unilateral action ran afoul of NLRA Section 8(b)(3) bargaining requirements as contrary to the parties’ clear understanding. California Nurses Association, 31-CB-012913 (Nov. 14, 2018) (unpublished). (The Board left the door open to finding, in a future case, that a union’s unilateral inclusion of a Weingarten rights statement in a collective bargaining agreement violates Section 8(b)(3) on an additional basis. In the 2018 decision, the Board stated that “it [is] unnecessary to pass on . . . the additional rationale that the [union] also unlawfully modified the contractual disciplinary procedure in the parties’ collective-bargaining agreement.”) The Board required the union — at its own expense — to reprint and redistribute the collective bargaining agreement without the Weingarten language. It also decided to retain “for further consideration” the Section 8(b)(1)(A) allegation.

The Section 8(b)(1)(A) Issue

Section 8(b)(1)(A) makes it unlawful for a labor union to restrain or coerce employees in the exercise of their Section 7 rights. Section 7 protects the right of represented employees to refrain from exercising their Weingarten right to union representation. In 2013, deciding the union had not violated Section 8(b)(1)(A), the Board applied its then-existing test for determining whether a work rule is lawful. According to the 2013 Board, under that test, provisions must be read in their context and improper interference with employee rights should not be presumed. The Board decided that employees would not reasonably understand “The Weingarten Rights” statement to restrain their right to forgo union representation at a disciplinary interview.

In 2017, in The Boeing Co., 365 NLRB No. 154, the NLRB created a new, employer-friendly standard for determining whether a work rule or policy has been unlawfully maintained that applies retroactively to all pending cases. That standard requires balancing the “the nature and extent of the potential impact on NLRA rights” against the “legitimate justifications associated with [a] rule.” An administrative law judge must now issue a decision addressing whether and to what extent the 2013 decision is affected by Boeing.

This case is another example of the Trump Board and NLRB General Counsel taking a close look at possible union misconduct. The General Counsel, for example, has directed field office staff to prosecute a broader array of cases than previously against unions that engage in negligent behavior toward their members.

 

 

 

Labor Board: Nonmembers Cannot Be Compelled to Pay Union Lobbying Expenses

Unions no longer can require objectors to contribute toward union lobbying costs, the National Labor Relations Board (NLRB) has ruled in a 3-1 decision. United Nurses & Allied Professional (Kent Hospital), 367 NLRB No. 94 (Mar. 1, 2019).

The NLRB said lobbying costs of all kinds are not considered part of a union’s statutory collective-bargaining obligations under the National Labor Relations Act (NLRA), and, therefore, unions cannot compel support. This decision represents the latest setback to efforts by public and private sector unions to collect and make use of nonmembers’ contributions.

The facts of Kent Hospital date back nearly a decade. In 2009, Jeanette Geary, a nurse working at Kent Hospital in Warwick, Rhode Island, resigned her union membership with United Nurse and Allied Professionals (UNAP). As a nonmember where the collective bargaining agreement contained a union-security provision requir­ing all new unit members to join the Union by their 30th day of employment, Geary was still obligated to contribute certain fees to UNAP. As established by the U.S. Supreme Court decision in Communications Workers v. Beck, 487 U.S. 735 (1988), a union may compel nonmembers to contribute fees deemed necessary to “performing the duties of an exclusive representative of the employees in dealing with the employer on labor-management issues.” Duties deemed necessary include collective bargaining, contract administration, and grievance adjustment.

In 2009, UNAP spent $22,650 from its general operating fund to contribute to its lobbying efforts in the Rhode Island and Vermont state legislatures. Those funds went directed toward lobbying on seven bills. The bills related to health care institutions, and they ranged in purpose from increasing funding for mental healthcare services at UNAP-represented facilities to increasing state monitoring of certain hospitals.

Geary challenged the lobbying expenditure as outside the scope of UNAP’s statutorily required functions and as unrelated to collective bargaining, contract administration, or grievance adjustment. The NLRB agreed. It found that lobbying expenses, at best, can serve only indirectly a union’s representative functions. Political functions, such as lobbying, are “too attenuated to justify compelled support,” according to the NLRB.

This is the opposite of the conclusion the NLRB came to when it first reached a decision in this case in 2012, under a more union-friendly NLRB. At that time, a majority of the Board endorsed a potential balancing test whereby lobbying for certain bills considered “germane” to statutorily-related union activities (such as bills increasing the minimum wage) would be permitted with nonmember contributions. However, the Supreme Court vacated that ruling when it held that three recess appointments to the Board in January 2012 were invalid. (For more on the Court’s decision, see our article, Supreme Court Issues Historic Decision on President’s Recess Appointment Power.) Member Lauren McFerran endorsed a similar balancing test in her dissent to this latest NLRB ruling.

The United Nurses ruling highlights two trends. First, the NLRB continues to reject the Obama-Board balancing tests in favor of bright-line rules on what is and is not permitted under the NLRA. Second, the decision demonstrates the continued limitations unions face in conducting political activity. The Supreme Court in 2018 disallowed public sector unions from collecting fees from nonmembers altogether. (See our article, Supreme Court Rules Unconstitutional Mandatory Fees Imposed on Non-Union, Public Sector Employees.) It appears that may apply to the private sector.

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

 

NLRB Chairman Fires Back at Request to Withdraw Notice of Proposed Rulemaking on Joint Employment

John Ring, NLRB Chairman, has sent a five-page letter to several members of Congress in response to their request for the NLRB to withdraw its Notice of Proposed Rulemaking on the joint-employer standard.

In the January 17, 2019 letter recently released to the public, the Board Chairman spent considerable time defending the Board’s position and clarifying a recent appellate decision in Browning-Ferris by the D.C. Circuit. For a detailed description of the decision, please see Joint Employment under NLRA: Interpreting D.C. Circuit Court’s Browning-Ferris. The Chairman stressed the need for more clarity in this area of the law and that determining joint-employer status continues to be one of the most difficult and debated subjects in labor law.

In support of his position, the Chairman stated that the Board has received more than 26,000 comments in response to the NPRM with two weeks remaining for additional comments at the time he prepared the letter. Ring further stressed that nothing in the D.C. Circuit’s decision “forecloses” the Board’s joint-employer rulemaking or otherwise requires the Board to suspend or withdraw its NPRM. He quoted various aspects of the D.C. Circuit’s decision in an effort to clarify the Court’s ruling and correct the interpretation articulated by several members of Congress. Ring remained steadfast in the decision to use the NPRM to obtain clarity and direction in formulating the final rule. He concluded as follows:

For all of these reasons, a majority of the Board continues to believe that Notice-and-Comment rulemaking offers the best vehicle to address the uncertainty surrounding the joint employer standard. Rulemaking provides an opportunity for input by tens of thousands of public commenters, including those who may not be able to afford an attorney to participate in our case adjudication process. Withdrawing the NPRM at this time certainly would be unfair to the thousands of individuals and groups that have expressed such a strong desire to be heard on this important topic.

In light of the recent D.C. Circuit Court’s decision, the Board extended the comment period deadline from January 14 to January 28, 2019, to provide an opportunity for the public to weigh in following the decision.

Jackson Lewis attorneys are available to address any questions about the joint-employer rulemaking and the current standard.

 

 

NLRB Overrules Obama-Board Independent Contractor Precedent, Reinstates Common Law Test

The National Labor Relations Board has overruled FedEx Home Delivery, 361 NLRB 610 (2014). In that case, the Obama-Board decided that, in determining whether an individual is an independent contractor or an employee, “entrepreneurial opportunity represents merely ‘one aspect of a relevant factor that asks whether the evidence tends to show that the putative contractor is, in fact, rendering services as part of an independent business.’” In SuperShuttle DFW, Inc., 367 NLRB No. 75 (January 25, 2019) the Board decided that its FedEx Home Delivery decision had (incorrectly) considerably limited the significance “of entrepreneurial opportunity by creating a new factor (‘rendering services as part of an independent business’) and then making entrepreneurial opportunity merely ‘one aspect’ of that factor.” The Board decided “the FedEx Board impermissibly altered the common-law test and longstanding precedent, and to the extent the FedEx decision revised or altered the Board’s independent-contractor test,” it was overruled. The Board “return[ed] to the traditional common-law test that the Board applied prior to FedEx.

Board Chairman John Ring, and Members William Emanuel and Marvin Kaplan comprised the majority; member Lauren McFerran dissented.

Please watch this space for a more extensive analysis of the Court’s decision.

 

 

 

 

 

 

Report: Union Representation Numbers Remain Low

Once again, the percentage of private sector union-represented workers fell – to 6.4% in 2018, from 6.5% in 2017, according to the Bureau of Labor Statistics of the U.S. Department of Labor.

Highlights from the “Union Members – 2018” report include:

  • Men had a higher union representation rate than women (11.1% to 9.9%).
  • Black employees were more likely to be union members than Caucasian, Asian or Hispanic employees.
  • Older workers were unionized at a higher rate: 12.8% of workers ages 45 to 54 and 13.3% of those ages 55 to 64 were represented by unions.
  • While nonunion workers’ median weekly earnings were less than those of unionized employees ($860 per week versus $1051 per week), this comparison does “not control for many factors that can be important in explaining earnings differences,” such as “variations in the distributions of union members and nonunion employees by occupation, industry, age, firm size, or geographic region.” (For example, unionized employees tend to be older and younger employees tend to earn less.)
  • The higher median weekly earnings for unionized employees does not apply to all occupations, however; median weekly earnings for a number of professional and management occupations such as those in business and financial operations and computer and mathematical occupations were higher among non-union employees than for union employees.
  • Hawaii and New York had the highest union membership rates (23.1% and 22.3% respectively), while North Carolina and South Carolina had the lowest (2.7% each).
  • In the private sector, utilities (20.1%), transportation and warehousing (16.7%), and telecommunications (15.4%) were the industries with the highest unionization rates. Finance (1.3%), food services and drinking places (1.3%), and professional and technical services (1.5%) were among the lowest.
  • The highest unionization rates in 2018 were in protective service occupations (33.9%) and in education, training, and library occupations (33.8%). Unionization rates were lowest in farming, fishing, and forestry occupations (2.4%); sales and related occupations (3.3%); computer and mathematical occupations (3.7% ); and in food preparation and serving related occupations (3.9% ).
  • California (2.4 million) and New York (1.9 million) had the largest number of unionized employees.

The 2018 BLS data on the rate of union membership reflect nothing more than the status quo – a tiny fraction of American workers in the private sector, and a minority overall, have chosen to become members of a union. Nevertheless, both unionized and union-free employers should be aware of local, industry, occupation, and other union membership trends. If you have any questions, please feel free to contact Jackson Lewis.

 

Bargaining Unit Can Still Be ‘Micro’ under ‘Community of Interest’ Standard

After the NLRB adopted a new standard for determining bargaining-unit composition, many expected fewer micro-units would result. PCC Structurals, 365 NLRB No. 160 (2017) (PCC I). However, when the employer filed a request for review (appeal) of the Regional Director’s decision allowing, on remand, a “micro-unit” of its employees to vote on union representation under the new standard, the NLRB denied it. PCC Structurals, Inc., No. 19-RC-202188 (Nov. 28, 2018) (PCC II).

In PCC I, the Board had overruled its Specialty Healthcare (357 NLRB 934 [2011]) decision, reviving its prior, more employer-friendly standard for evaluating an employer’s claim that a petitioned-for bargaining unit should be expanded to include additional employees requested by the employer. In PCC I, the Board ruled that a party seeking to add employees to a “micro-unit” need only show the excluded employees share a “community of interest” with the petitioned-for employees, rather than the “overwhelming community of interest” required under Specialty Healthcare.

In PCC I, the Board remanded the case to the Regional Director for evaluation of the union’s proposed bargaining unit and the employer’s counterproposal under the new standard. The Regional Director determined that, even under the new standard (and the Board’s craft-unit case law), the union’s petitioned-for micro-unit (a group of the employer’s rework employees and welders – approximately 120 employees) was appropriate. (The company had taken the position that the unit should include all production and maintenance employees, which would mean 120 job classifications and 2,565 employees.) The Regional Director explained that “the petitioned-for Unit constitutes a craft unit of highly skilled welders and is appropriate for the purposes of collective bargaining in that the petitioned-for welders share a community of interest sufficiently distinct from excluded employees.” The analysis considered departmental organization, skills and training, job duties, functional integration, contact, interchange, terms and conditions of employment, and supervision. The Board concluded that these factors weigh in favor of finding the petitioned-for employees share “a community of interest sufficiently distinct from excluded employees.”

 

 

D.C. Circuit Court of Appeals Upholds NLRB’s Browning-Ferris Joint-Employer Test, Cautions Board on Rulemaking

In a long-awaited decision, the D.C. Circuit Court of Appeals has upheld the controversial joint-employer standard articulated by the National Labor Relations Board in its 2015 Browning-Ferris decision. Browning-Ferris Industries of Calif., Inc. v. NLRB, D.C. Cir., No. 16-1028, 12/28/18.

The Court held that the Board properly considered both the putative employer’s reserved right to control and its indirect control over the employees’ terms and conditions of employment as factors for determining whether businesses should be considered joint employers. The Court wrote, “The Board’s conclusion that it need not avert its eyes from indicia of indirect control—including control that is filtered through an intermediary—is consonant with established common law. And that is only question before this court.”

Although the Board properly considered indirect control as a factor, the Court noted that the Board had “failed to differentiate between those aspects of indirect control relevant to status as an employer, and those quotidian aspects of common-law third-party contract relationships.” In other words, the Board failed to articulate the scope of what it considers “indirect” control.  Consequently, the D.C. Circuit remanded the issue to the Board for further consideration.

Despite this decision, the Board’s proposed joint-employer rulemaking remains open for public comment until January 14, 2019. The impact of this decision on the Board’s rulemaking remains to be seen, but the Court cautioned that  “[t]he policy expertise that the Board brings to bear on applying the National Labor Relations Act to joint employers is bounded by the common-law’s definition of a joint employer. The Board’s rulemaking, in other words, must color within the common-law lines identified by the judiciary.”

Please watch this space for a more extensive analysis of the Court’s decision.

Labor Board Further Extends Deadline for Submitting Comments on Proposed Joint-Employer Rulemaking

The National Labor Relations Board has once again extended the deadline for submitting comments regarding its proposed rulemaking on the standard for determining joint-employer status under the National Labor Relations Act, this time to January 14, 2019. Replies to comments submitted during the initial comment period must be received by the Board on or before January 22, 2019.

This public-comment period is an important opportunity for companies to submit input and concerns and increase the possibility of a well-informed, comprehensive final rule that will provide clear guidance to and limit the risk of litigation for employers. Companies that use or provide temporary or supplemental staffing services are strongly encouraged to submit comments to the Board for consideration. Companies that regularly work with franchisors and franchisees or with subcontractors also may want to comment, as the proposed changes may affect them directly.

Jackson Lewis is available to assist organizations to submit comments.

 

 

 

 

 

Some Employers Will Have Workplace Rules Re-Evaluated By NLRB

The National Labor Relations Board is affording dozens of employers the chance to have cases involving the legality of their workplace rules re-evaluated under a 2017 Board decision. The Board decision overruled Obama-era Board precedent that hampered employers’ ability to maintain workplace conduct rules without running afoul of the National Labor Relations Act. The Board’s new initiative, first reported by Bloomberg Law, involves remanding numerous cases that held against employers for reconsideration by NLRB administrative law judges.

Workplace rules have been a contentious issue under federal labor law for years. In 2004, the NLRB issued its controversial decision in Lutheran Heritage Village-Livonia, 343 NLRB 646 (2004), which set a tough standard to determine whether workplace rules, policies, and handbook provisions unlawfully interfere with rights of employees protected by the Act. In Lutheran Heritage, the Board held that a neutrally worded rule would violate the NLRA if employees may “reasonably construe” the rule to prohibit an employee’s exercise of his or her protected rights. Lutheran Heritage made it considerably harder for employers to maintain otherwise benign-sounding handbook provisions prohibiting rude or disruptive workplace behavior.

In 2017, after the composition of the Board shifted to a Republican majority, the NLRB issued Boeing Co., 365 NLRB 154 (2017). In Boeing, which overruled Lutheran Heritage, the Board held that determining whether an employer rule is unlawful involves a balancing test that measures the rule’s impact on employee rights against an employer’s legitimate business interests in maintaining the rule. The Board created a three-tiered rules classification system: “Category 1” rules are those the Board has specifically designated as lawful; “Category 2” rules are those that require individualized scrutiny to determine their legality; and “Category 3” rules are those specifically designated by the Board as unlawful.

On June 8, 2018, the NLRB’s General Counsel, Peter Robb, issued a memo providing specific examples of which rules would fall into each of these categories. For example, the General Counsel’s memo identified as a Category 1 rule one that prohibited “behavior that is rude, condescending or otherwise socially unacceptable.”

The Board’s latest action remands at least 40 workplace rules cases for a fresh look under Boeing. Any new decisions will strengthen Boeing as precedent. Moreover, the new decisions certainly will provide employers clear examples of what employee conduct they can and cannot prohibit or limit through workplace rules.

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