Pearce Nominated for Third Term on NLRB

Mark Gaston Pearce has been nominated by President Donald Trump to serve a third term on the National Labor Relations Board. Pearce, a 2010 recess-appointee under then-President Barack Obama, was reappointed to a second term in 2013. That term expired on August 27, 2018. Pearce’s nomination now heads to the Senate for consideration.

Pearce was instrumental to the Board’s shift toward a labor-friendly approach during the Obama Administration. However, following the Senate’s confirmation of Trump’s Republican nominees Marvin Kaplan on August 2, 2017, William Emanuel on September 25, 2017, and John Ring on April 11, 2018, the Board has established a firm Republican and pro-business majority. Indeed, Trump’s Board has already reversed several significant Obama-era decisions.

In July, industry groups reportedly were urging the Trump Administration not to re-nominate Pearce, one of two remaining Democrats on the Board (along with Lauren McFerran). The Trump Administration’s process, which had already begun, was put on pause at the time.

Bloomberg BNA later reported that the Senate was working on a deal with President Trump that would allow Pearce to be reconfirmed and, consistent with tradition, the minority party would retain two of the five seats on the Board. The deal also would ease the backlog of pending nominees to numerous positions within the Department of Labor and other departments. More than 150 nominees reportedly are awaiting confirmation.

A deal could be reached to confirm Pearce by the end of August.

Jackson Lewis attorneys are available to discuss how these and other developments and trends at the NLRB may affect your organization.

NLRB GC Institutes Changes to Certain Decision-Making Processes

The National Labor Relations Board’s General Counsel’s office has issued an internal Memorandum (“Changes to Case Processing Part 1”) to all regional directors, officers-in-charge, and resident officers announcing immediate enactment of case processing changes.

The six-page memorandum, obtained by Bloomberg BNA, addresses four policies. Memorandum ICG 18-06 (July 30, 2018). According to the Memorandum, the changes are based “almost entirely from suggestions received from all levels of the Agency….”

The first four pages of the memorandum, on “Decision-Writing Centralization,” outline the “streamlin[ing of] the decision-writing process” of pre-election R-Case decisions that arise within each of the four NLRB Districts (each District consists of a number of Regions). The General Counsel wants a dedicated group of decision writers who have “the time, resources, and specialized skills to efficiently draft decisions…” and, therefore, would be able to help achieve quality consistency across all Districts and Regions.

The Memorandum states that the number of writers for each District will vary from one to three, based on an analysis of the number of R-Case pre-election decisions issued during fiscal year 2017. During the time an individual is a decision writer, his unfair labor practice case workload will be adjusted to accommodate his writing duties.

The Memorandum contains some interesting statistics. They show a large disparity across the NLRB in the number of pre-election R-Case decisions written in each Region. During FY 2017, 157 decisions were issued across the NLRB. Four Regions wrote at least 12 decisions, and nine wrote three or fewer. The Memorandum also reveals wide disparities in the amount of time it takes Regions to write decisions. The median amount of time two Regions took to write decisions was 15 or fewer days (the lowest regional median was 14 days), while the median amount of time one of the Regions took was 68 days. Thus, another goal of centralized decision-writing is “lower and more consistent medians across Districts and Regions.”

The second policy, on “Streamlining Advice Branch Submissions,” addresses the delays in processing cases submitted to the Advice Division that have “been a cause of criticism” inside and outside of the NLRB. The General Counsel proposes to reduce required paperwork through the submission of “short form memos” to Advice. Additionally, some Advice submissions may be in the form of an email. Further, other submissions may be made by incorporating all of the necessary evidence by reference if it can be found in, for example, the “Agenda Minute.”

The third policy, on “Streamlining Ethics Issues,” states that legal ethics guidance memoranda will be categorized and stored in a searchable format that Regional personnel can access. Consistent with the overall goal of the Memorandum, this should increase consistency and efficiency across the Regions when they deal with ethical issues.

The final policy change is entitled “Team-Decisions.” Regional Directors are instructed to “delegate appropriate case-handling decision-making authority” to supervisors, rather than participating in even “the more mundane case-handling decisions.” The breadth of the “decision-making authority” that may be given to supervisors may include, for example, approving dismissals, withdrawals, or settlements. It also may involve allowing the supervisor and agent to make the final decision about a charge where they agree on the merit or lack thereof. The General Counsel’s office notes that 17 regions allow supervisors to participate in decision-making and have experienced “great success.”

The Memorandum states that delegation is “appropriate in most Category 1 [exceptional impact] cases and some Category 2 [significant impact] and 3 [important impact] cases.” The Memorandum notes that a Regional Director’s appropriate delegation of authority to supervisors and managers will be positively noted in their annual appraisals under “critical element 2 (leading people 10%).” The Memorandum also states “the extent to which a supervisor or manager steps up and assumes these responsibilities will be positively noted in their appraisals.”

Additional changes should be expected. In addition to the Memorandum’s title (“Changes to Case Processing Part 1”), footnote 1 states that “some other items… will be addressed in one or more memos soon to follow.”

Please contact Jackson Lewis if you have any questions.





NLRB Revisiting Rule on Employees Use of Employer’s Email System

The National Labor Relations Board has invited briefs on whether it should modify or overrule its rule under the National Labor Relations Act, established in Purple Communications, that employers must permit employees who have been provided access to their employer’s email system to use that system for statutorily protected communications on their non-working time. Rio All-Suites Hotel and Casino, No. 28-CA-060841 (Aug. 1, 2018).

The Board also asked whether the Board’s standard should apply to computer resources beyond email systems, such as instant messages, text messages, postings on social media, and the like.

In Purple Communications, 361 NLRB 1050 (2014), the Board also decided that an employer may restrict the right to use of its email system if it can demonstrate that special circumstances exist to maintain production or discipline.

The Board had overruled Register Guard, 351 NLRB 1110 (2007), in Purple Communications. The Board held in Register Guard that an employee does not have a statutory right to use his employer’s email system for Section 7 activity. It decided that an employer may impose Section 7-neutral restrictions on employees’ non-work-related uses of its email systems, even if those restrictions limit the use of its systems for union or other protected communications.

In Rio All-Suites Hotel and Casino, the rule in question (as promulgated and currently maintained) barred employees from “send[ing] chain letters or other forms of non-business information.” Administrative Law Judge Mara-Louise Anzalone held that, insofar as the rule banned all use of the employer’s email system for non-business distribution and solicitation, it violated Purple Communications. The ALJ further found that no special circumstances existed. The employer excepted (appealed), asking the Board to overrule Purple Communications and, indirectly, to return to the Register Guard standard.

The Board wants briefs to address the following questions:

  1. Should the Board adhere to, modify, or overrule Purple Communications?
  2. What standard should the Board adopt instead of Purple Communications?
  3. Should the Board return to the holding of Register Guard or adopt another standard?
  4. If the Board returns to the holding of Register Guard, should it make exceptions for circumstances that limit employees’ ability to communicate with each other through means other than their employer’s email system (e.g., because of a scattered workforce or facilities located in areas without broadband access)? If so, should it specify such circumstances or leave them to be determined on a case-by-case basis?
  5. Should the Board apply a different standard to the use of computer resources other than email and what should that standard be?

NLRB Chairman John F. Ring and Members Marvin E. Kaplan and William J. Emanuel joined to issue the Notice and Invitation to File Briefs. Members Mark Gaston Pearce and Lauren McFerran dissented. Briefs must be filed by September 5, 2018. Responsive briefs may be filed by September 20, 2018.

Jackson Lewis is available to file amicus briefs on behalf of employers and employer associations in connection with this Notice and Invitation to File Briefs.

Missourians Reject Right-to-Work

Missouri voters have rejected right-to-work. Senate Bill 19, which would have made Missouri the nation’s 28th right-to-work state, was passed by the Missouri legislature on February 2, 2017, and signed into law by then-Governor Eric Greitens. Labor organizations and their supporters gathered enough signatures to keep the law from going into effect until voters in Missouri had an opportunity to weigh in.

A “right-to-work” law generally prohibits an employer and the union representing its employees from requiring those employees to join the union or pay dues to the union as a condition of their employment.

After Senate Bill 19 was signed into law, labor organizations and their supporters spent millions of dollars to gather enough signatures to put the bill to a vote. Ten days before the law was to become effective (on August 28, 2017), union supporters submitted more than 310,000 signatures (almost three times the 108,467 that were needed) and stopped the law from taking effect. On November 22, 2017, the Secretary of State certified that enough signatures had been submitted and set the right-to-work law for a vote on whether the law should take effect.

The vote was originally scheduled for the November 2018 mid-term general elections. However, on May 17, 2018, the Missouri legislature moved the vote to August 7, when Missouri holds its primaries.

Supporters of “right-to-work” laws generally argue that employees should not be forced to join a union that they do not wish to support. Opponents of “right-to-work” claim that such laws unfairly allow employees to receive the benefits of union contracts and representation without requiring them to contribute financially to the costs of obtaining those benefits.

Reportedly, lawmakers have indicated a willingness to reintroduce right-to-work legislation in 2019, but they have admitted they have to evaluate first where the “political will” is.

Jackson Lewis attorneys are available to discuss how this and other developments affect employers and their businesses.


Weingarten Rights Not Violated; Employee Lawfully Terminated for Refusal to Take Drug/Alcohol Test

An employee’s Weingarten rights have limits, especially as to drug and alcohol testing, where time is often of the essence, an NLRB Administrative Law Judge has held. Fred Meyer Stores, Inc., No. 19-CA-206136 (July 2, 2018).

The National Labor Relations Board has long-recognized unionized employees’ right to have a union representative present for investigative meetings that may result in discipline (these “Weingarten rights” do not apply in non-union workplaces). In Fred Meyer Stores, Inc., a cashier was suspected of drinking alcohol on the job after two customers allegedly reported smelling alcohol on his breath. The employee was called in by management for a meeting and once the employee understood the nature of the meeting, he requested his Weingarten right to union representation. Weingarten rights were spelled out to the employee on a union-provided card, which included numbers for individual union representatives, plus a 24/7 “emergency” phone number printed in red. The employee called multiple union representatives, but could not reach one directly. He did not call the “emergency” line.

After about 20 minutes, management asked the employee to submit to a drug/alcohol test, which the employee refused to do without a union representative. The employee was advised that a union representative could attend if available, but the employee continued to refuse to take the test in light of his inability to reach a union representative.

The employee was suspended pending investigation, and his employment was ultimately terminated a few days later.

The Administrative Law Judge rejected the employee’s challenge to his termination on Weingarten grounds, recognizing that “alcohol testing is time sensitive.” The Judge also found the company’s actions reasonable in light of the employee’s failure to contact an available union representative through the union’s 24/7 emergency phone number.

In other contexts, the Board has found that an employer’s refusal to allow an employee accused of alcohol or drug abuse union representation violated the employee’s Weingarten rights. The Judge in Fred Meyer Stores distinguished those cases in rejecting the employee’s claim in this case.

Fred Meyer Stores reminds employers that unionized workers must be given a reasonable opportunity to seek and obtain union representation before requiring a drug or alcohol test. However, an employer need not wait indefinitely and risk losing the utility of a time-sensitive drug or alcohol test before testing an employee for suspected substance abuse.

Jackson Lewis attorneys familiar and experienced with this issue are available to discuss this case and how it impacts your workers and business.

NLRB Member Pearce, One of Two Remaining Democrats, May Not Get Third Term

The Trump Administration is being asked not to give Member Mark Gaston Pearce, one of two remaining Democrats on the National Labor Relations Board, another term after his current term, his second, expires on August 27, Bloomberg BNA has reported.

Industry groups reportedly have asked the President to delay re-nominating Member Pearce to a third term, a process the Trump Administration had begun. That process has apparently “been put on hold.” Pearce was sworn in as a Board Member on April 7, 2010.

Trump has re-shaped the NLRB by nominating Republican Members to fill Board vacancies. Last fall, the U.S. Senate confirmed Marvin Kaplan and William Emanuel, which, along with then-Chairman Philip Miscimarra, a Republican, gave the Board a Republican majority for the first time in more than a decade. In December 2017, that Board issued a series of business-friendly decisions that overruled high-profile decisions championed by labor organizations and the Obama Administration. More recently, management-side labor attorney and Republican John Ring was confirmed as a Board Member to replace Miscimarra, whose term ended after the decisions were issued.

Traditionally, the NLRB is made up of three members of the sitting president’s political party and two members of the minority party. That means that the seat Pearce vacates would be filled by a Democrat appointed by Trump. However, Trump also has the option not to fill the vacant seat. The Board could operate with four of the five seats filled – only three Members are needed for a quorum. Although having an even number of Board members could increase the possibility of 2-2 votes, given that three of the four Members would be like-thinking Republicans, that possibility should be minimal.

With or without Member Pearce, or any replacement, Trump’s Republican-controlled NLRB is expected to continue undoing decisions that heavily favored labor organizations.

Jackson Lewis attorneys are available to discuss the most recent developments at the NLRB and how they impact your specific organization.


NLRB Expands Its Alternative Dispute Resolution Program

The National Labor Relations Board has announced it will begin a pilot program to encourage parties to use its Alternative Dispute Resolution program.

Under the pilot program, the NLRB’s Office of the Executive Secretary will proactively engage parties with cases pending before the Board to determine whether the case is suitable for ADR. The process is voluntary.

The ADR program began in 2005 as an alternative means for parties to resolve cases pending before the Board. According to the NLRB, since its inception, mediators have assisted parties in reaching settlements in approximately 60 percent of the cases in the ADR program.

The program is available to any party with an unfair labor practice or compliance case pending before the Board. Once the parties enter the program, the ADR Program Director arranges for a neutral to assist the parties. The neutral will conduct a conference, normally in person, to assist the parties in reaching a settlement. The neutral has no authority to impose a settlement; whether or not to settle remains voluntary. NLRB rules provide that all settlement discussions during the ADR process are confidential and that evidence as to what transpired during the ADR process may not be used in any administrative or court proceeding.

The ADR program results in only a minimal delay in the case proceedings. Although entry into the ADR program places all case deadlines on hold, a case may only remain in the ADR program for 28 days, unless the parties and the ADR Program Director agree otherwise. The parties are not responsible for any costs or expenses associated with the program.

Employers should weigh carefully whether ADR may be appropriate in their cases. For example, where a charging party has overvalued its case, an NLRB mediator who is seen by the charging party as a neutral may be helpful. Although not every case is suitable for the ADR program, the program may be a viable alternative to continued litigation.


NLRB GC: Employer Can Unilaterally Implement Decisions Made Before Union Election Victory

An employer lawfully unilaterally implemented a stricter tardiness and absentee policy even though a union had recently won an election to represent its workers, according to a memorandum released by the National Labor Relations Board General Counsel’s Division of Advice. Cott Beverages, Inc., No. 16-CA-206068 (Div. of Advice, Apr. 26, 2018, released May 15, 2018).

Cott Beverages, Inc., with a production and warehouse facility in Texas, issued an employee handbook in October 2016 that contained an attendance policy. The policy stated that employees would be assessed points for violations, including one-half point for each instance of tardiness from 1 minute to 120 minutes. Progressive discipline would be assessed after six points had been issued within a rolling 12-month period. Enforcement initially was “lax and sporadic.” Hoping to achieve more uniform compliance, the employer held trainings for its employees in late-February and early-March 2017 on the attendance policy. Employees were required to sign acknowledgements that violations would result in coaching.

Shortly after the trainings, a union filed a petition to represent Cott’s employees. The union won the election and was certified in early-May 2017. Subsequently, the union filed an unfair labor practice charge with the NLRB alleging the employer had violated the National Labor Relations Act by unilaterally enforcing the attendance policy more strictly in June 2017.

As the advice memorandum explains, the general rule is that an employer cannot make unilateral changes to its employees’ terms and conditions of employment; it must give the union an opportunity to bargain. Stricter enforcement of an existing policy after a union election will generally be deemed such a unilateral change. However, here, the Division of Advice determined that the employer had not violated the Act because it had already decided to strictly enforce the tardiness policy before the election. The Division noted that the training sessions held before the election supported the employer’s assertion that the decision had been made pre-election. A “firm decision” to change a condition of employment made before an election, the Division explained, will not be found unlawful even if the actual implementation occurs after the election. The charge was dismissed.

This advice memorandum reminds employers that, although bargaining with a newly certified union is usually required before an employer may make any substantive changes to its employees’ terms and conditions of employment (such as an attendance policy), an employer does not have to reverse course on previous decisions, even if those decisions have not been fully implemented when the union is certified. Employers that lose NLRB representation elections and want to make changes unilaterally should review the status of any workplace policy initiatives to determine whether a documented final decision on implementation of the change previously had been made. If so, the employer likely may proceed with the change without bargaining with the union.

NLRB GC: Employer Can Refuse Union’s Request to Record Meetings and Interviews

The National Labor Relations Board General Counsel’s Division of Advice has concluded that an employer could refuse to allow a union’s representatives to record monthly team meetings and investigatory interviews. GE Appliances, Haier, 21-CA-202535 (Div. of Advice, Apr. 17, 2018, released May 15, 2018). The Division found the refusal was lawful based upon the Board’s long-standing policy disfavoring verbatim recordings of meetings between employers and unions for collective-bargaining purposes.

GE Appliances, Haier, sells and repairs home appliances and parts nationwide. The employer’s service technicians, who are represented by a union, work from their homes and are dispatched on service calls to homes and businesses. The employees’ manager conducts monthly in-person team meetings with the technicians. In addition, union representatives are asked to attend any meetings where investigatory interviews take place that could lead to the discipline of the interviewee.

In late-2016, the employer conducted an investigatory interview with a bargaining unit member over time card discrepancies. During the subsequent grievance process, the union asserted that typewritten notes the employer’s manager had prepared during the initial meeting were incomplete. It also separately asserted that the manager regularly announced policy changes during monthly team meetings. Therefore, the union requested it be allowed to record team meetings and investigatory interview meetings because those meetings could “threaten the rights of each employee.” The employer refused the request.

The Advice Division found the refusal did not violate the NLRA. The Division explained that the Board has had a long-standing policy of prohibiting audio recordings of bargaining negotiations and grievance meetings because of the potential to hamper open communications. The Division found the request to record team meetings and investigatory interviews implicated the same adverse effects on the bargaining process. It was concerned that the union’s express purpose of recording the meetings — to preserve the manager’s statements to later impeach him — could have a chilling effect on informal resolution of workplace disputes.

Finally, the Division noted the request here did not implicate the Section 7 rights of individual employees to record conversations, which arguably could be protected under certain circumstances. Rather, the request was made by the union on behalf of its representatives. Thus, there was no need to evaluate the employer’s response under the Board’s workplace rule guidance in The Boeing Co., 365 NLRB No. 154, slip op. (Dec. 14, 2017). Accordingly, the Division advised that the charge be dismissed, absent withdrawal. Based on a review of the publicly available docket, it appears that the union withdrew the charge in April.

The Division’s advice memorandum slightly expands upon the types of meetings in which a union may not make audio recordings. Now, not only may an employer refuse to consent to such recordings during a grievance meeting, but also it may lawfully refuse the union’s request in connection with meetings that could result in a later grievance meeting, such as the investigatory meetings at issue here. Furthermore, the memorandum reminds both employers and unions that the Board’s policies reflect the view that the collective bargaining relationship works best when open, informal communication is used.

Seattle Ordinance Giving Drivers Right to Collectively Bargain Not Preempted by NLRA

A landmark law giving drivers of app-based transportation companies, such as Uber and Lyft, the right to collectively bargain is not preempted by the National Labor Relations Act, a three-member panel of the Ninth Circuit Court of Appeals has ruled. U.S. Chamber of Commerce v. City of Seattle, No. 17-35640 (9th Cir. May 11, 2018).

Among other things, the NLRA regulates union activity and collective bargaining among almost all private-sector employees in the United States. The Seattle law affords covered drivers with rights analogous to those accorded employees under the NLRA, such as the right to select a representative to negotiate certain terms and conditions of employment.

The Court also ruled the law is not exempted from the Sherman Antitrust Act, under the Sherman Act’s exemption for states to enact laws that regulate competition. (The Sherman Act prohibits price-fixing and other practices that inhibit competition.) The Ninth Circuit panel decided that Seattle’s law did not meet either of the exemption’s requirements. First, the law does “not ‘plainly show’ that the Washington legislature ‘contemplated’ allowing for-hire drivers to price-fix their compensation.” Second, “[i]t is undisputed that the State of Washington plays no role in supervising or enforcing the terms of the City’s ordinance,” the Court said, and the lack of active state supervision meant the “active-supervision requirement” of the exemption also was not met.

The Seattle City Council passed the law on December 13, 2015; it took effect in January 2016. From the outset, the law faced numerous legal challenges, with advocates for businesses and employees weighing in. On its face, the law is intended to improve public health, safety, and welfare by providing Seattle with a means to regulate for-hire and taxicab transportation services.

In addition to opening the door to further legal challenges under the Sherman Act, the panel’s ruling offers a potential silver-lining to workers’ rights advocates. By ruling that the law was not preempted by the NLRA, efforts to organize independent contractors, who are exempt from the NLRA, may increase through the passage of state laws similar to Seattle’s.

Please contact a Jackson Lewis attorney if you have any questions.