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Michael Rudman

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NLRB Remakes Workplace by Reversing Obama-Era Decisions

Posted by Michael Rudman on Jan 7, 2020 10:30:00 AM

The National Labor Relations Board (NLRB) under President Donald Trump is remaking the American workplace by methodically undoing key pro-union rulings the board made under former President Barack Obama.

organizedlaborgoodsmallThe rapid reversal in many ways underscores the increasing polarization of the national political debate and the whiplash that employers and unions alike face every time the White House changes hands.

The NLRB, created by the National Labor Relations Act in 1935, is comprised of five members, all appointed by the president.  The chair and two members of the board are traditionally from the president's party. The remaining two members are from the opposition party.

Republican John Ring currently serves as NLRB chair. The other two Republicans on the board are Marvin Kaplan and William Emanuel.  One Democrat seat on the board is vacant and the other is held by Lauren McFerran since December 2017.

NLRB rulings traditionally vacillated from one administration to another in relatively narrow range, reflecting either a pro-employee or pro-employer bias.  The limits began to widen significantly during the Obama-era NLRB as a series of decisions and rule-making initiatives significantly tilted the playing field in favor of expeditious union organizing.

But the new board has issued a steady series of rulings that have effectively undone the Obama-era edicts.  The highlights of these changes include:

Joint Employer Status

Organized labor has long sought to establish a joint employer relationship between franchisors and franchisees.  The reason is simple - locally owned franchisees may not have deep pockets, but parent organizations usually do.  In its long-awaited McDonalds decision, the new board clearly found that the franchisor is not a joint employer with its franchisees.  While final rule making hasn’t been issued in this regard, it is clear franchisors can breathe a sigh of relief.

Micro-Unions

The prior board in its Specialty Healthcare decision made it easy for unions to isolate small, easier-to- organize groups of employees.  The new board has reverted to a broader “community of interest” standard and a clear, three-part test (Boeing Company).  

Workplace Investigations

In a prior decision (Banner Estrella), the board prohibited employers from requiring employees to keep workplace investigations confidential.  The new board has overturned that ruling (Apogee Retail) and provides a more common-sense approach to workplace investigations.

Quickie Elections

The prior board’s rule making in 2014 had the effect of accelerating the union organizing process and hindering employer response to union activity.  The new board rule making: (1) increases most time frames and deadlines by a factor of two; (2) requires that ballots be automatically impounded upon challenge; and (3) allows challenges up front, prior to voting, versus the 2014 approach of ‘let everyone participate and we’ll sort it out later.’

Employer Email

As a result of the NLRB’s 2014 Purple Communications decision, employers could not prohibit employees from accessing company email for union-related communications.  The new board (Caesar’s Entertainment) restores employer rights to prohibit use of its email systems for non-business purposes.

While these rulings are good news for employers, they don’t eliminate the prospect of employees seeking third-party representation.  Fair and equitable treatment of employees, employing supervisors who know how to lead (not manage) and effective workplace communications are the employer’s best tools in making unions unnecessary.

Register for Labor Relations Primer Webinar

 

Topics: Unions, National Labor Relations Board

NLRB Ruling Alters Workplace Landscape

Posted by Michael Rudman on Aug 28, 2015 1:55:00 PM

The National Labor Relations Board (NLRB) has fundamentally altered the workplace landscape for companies that hire contractors to staff their facilities.

ManufacturingWorkerSmallThe NLRB ruled in a 3-to-2 decision yesterday that a company that hires a contractor to staff its facilities may be considered a joint employer of the workers at that facility, even if the company does not actively supervise them. A union representing those workers would therefore be legally entitled to bargain with the parent company, not just the contractor, under federal labor law.

The ruling, which is likely to be challenged in court, could also expose employers to regulatory and legal liability based upon the actions of contractors.

“The ruling is bad news for employers in many industries who use third-party labor providers. Companies use labor contractors to staff up during busy times or to permit themselves to concentrate on their core business, but the NLRB ruling may change that,” said Gary MacDonald, Executive Vice President of the Employers Resource Group at Associated Industries of Massachusetts.  

NLRB Chairman Mark Gaston Pearce was joined by fellow Democrat-appointed members Kent Y. Hirozawa and Lauren McFerran in the majority opinion; Republican members Philip A. Miscimarra and Harry I. Johnson III dissented.  

"The majority’s decision will have the effect of disturbing legitimate business relationships and cause businesses to become embroiled in the labor disputes of their commercial partners," said Rob Fisher, a labor lawyer for the Boston law firm Foley Hoag LLP and chair of the AIM Human Resources Committee.

"What is disingenuous about the decision is the majority’s repeated insistence that it merely restated the existing joint employer test.  As the dissent correctly points out, the majority’s approach removes all limits on the kind or degree of control necessary for joint employer status.  This a major shift in federal labor law."

The NLRB applied what it called long-established principles to find that two or more entities are joint employers of a single work force if (1) they are both employers within the meaning of the common law;  and (2) they share or codetermine those matters governing the essential terms and conditions of employment. In evaluating whether an employer possesses sufficient control over employees to qualify as a joint employer, the NLRB said it will - among other factors - consider whether an employer has exercised control over terms and conditions of employment indirectly through an intermediary, or whether it has reserved the authority to do so. 

The consequences of the ruling could be far reaching. Here are a few examples:

  • A contractor that provides laborers to a distribution center is charged by the NLRB with an unfair labor practice. Any judgement could be entered against the distribution center operator as a joint employer.  That judgement could in very rare instrances include a so-called Giselle ruling against the third party requiring them to recognize a union in lieu of a vote.  The distribution center operator could be compelled to continue to use the third party employees even though they now may be no longer cost effective.
  • A union organizes a single unit of a franchised fast-food operator.  The parent company could be compelled to negotiate with the union and, by extension, provide financial support if the economic circumstances of the franchisee prohibit funding the new contract. If the corporate parent were to agree to pay higher wages or provide better benefits, it would apply only to that particular restaurant, in the same way that concessions granted to employees in a single unionized portion of a national company that is not franchised apply only to that portion. At the same time, however, the concessions may give unionized employees at other locations practical leverage in their negotiations with the company.

“This change will subject countless entities to unprecedented new joint-bargaining obligations that most do not even know they have, to potential joint liability for unfair labor practices and breaches of collective-bargaining agreements, and to economic protest activity, including what have heretofore been unlawful secondary strikes, boycotts, and picketing,” Miscimarra  and Johnson wrote in their dissent.

Employers believe they should not be required to bargain with employees of their contractors or franchisees, and should not be held liable for labor-law violations involving workers over whom they exert only indirect supervision. The NLRB rejected that logic.

“It is not the goal of joint-employer law to guarantee the freedom of employers to insulate themselves from their legal responsibility to workers, while maintaining control of the workplace,” the labor board majority wrote.

Fisher at Foley Hoag warns that businesses with existing contracts for the supply of workers or subcontracting arrangements should not assume that the decision is stayed pending the outcome of any court challenges.

"The NRLB’s position is usually the opposite, so we can assume that unions will now be asserting the new joint employer test and that the NLRB will be applying it.  I certainly encourage businesses to review their contractual relationships and to identify potential areas of risk.  However, the Board’s apparent emphasis on indirect control as being sufficient to establish joint employer status means that normal contractual demands relating to the timing, manner and quality of performance by a vendor may be enough," he said.     

Topics: Unions, National Labor Relations Board, NLRB

Twin Labor Board Decisions Change Workplace Landscape

Posted by Michael Rudman on Dec 15, 2014 8:24:02 AM

The National Labor Relations Board dramatically shifted the workplace landscape last week with two landmark decisions – one accelerating the timing of union representation elections and a second permitting employees to use company email accounts on their own time to discuss organizing.

organizedlaborgoodsmallThe rule on expedited union elections had been sought for years by organized labor to limit the ability of companies to respond to organizing efforts. The measure eliminates a previously-required 25-day period between the time an election is ordered and the election itself and curtails employers’ ability to appeal eligibility and other issues prior to a union representation election.

It will also require employers to furnish union organizers with all available personal email addresses and phone numbers of workers eligible to vote in a union election. The rule, which takes effect on April 14, allows electronic filing and transmission of union election petitions for the first time.

The NLRB first proposed the change in 2011, but the U.S. Court of Appeals for the D.C. Circuit struck it down over a lack of quorum in a case in which Associated Industries of Massachusetts (AIM) participated. The board re-introduced the rule in February.

Abbreviated union elections place employers at a disadvantage because most don’t find out about a union campaign until it is well under way- frequently when the union has more than 75 percent of the potential unit employees signed up.

“The bottom line for employers who are non-union and wish to remain so is the dramatic reduction in the time available to educate employees, express the company’s point of view on union representation and combat union propaganda during an election campaign,” said Tom Jones, Vice President at AIM.

The decision on accelerated elections came two days after the NLRB ruled that “employee use of email for statutorily protected communications on nonworking time must be permitted by employers who have chosen to give employees access to their email systems.”

Statutorily protected communications generally refer to activities in which employees engage during union organizing campaigns, union elections or in the exercise of their rights to address work grievances. The communications are protected in both union, and non-union, environments.

The NLRB was quick to clarify who is covered by its decision:

  1. The ruling applies only to employees who have already been granted access to the employer’s email system.
  2. An employer may justify a total ban on non-work use of email by demonstrating that special circumstances make the ban necessary to maintain production or discipline.
  3. Absent justification for a total ban, the employer may apply uniform and consistently enforced controls overs its email system to the extent such controls are necessary to maintain production and discipline.
  4. The ruling does not address email access by nonemployees, nor any other type of electronic communications.

Both NLRB decisions were made with three-to-two margins with the Democratic appointees voting in favor and the Republican appointees voting against.

Jones says the expedited election decisions makes it incumbent upon employers to take a preventative, rather than reactive approach to labor relations. The campaign to win votes must be an ongoing effort – even in the absence of a formal campaign or even a remote threat of union activity. 

There are several steps employers can take right now:

  • Assess your organization’s vulnerability to a union;
  • Train your supervisors on the ‘real’ issues that bring in a union – it’s almost always about respect, consistency and fair treatment;
  • Communicate with your federal elected representatives;
  • Get professional help in assessing and preparing for the possibility of a union drive – waiting until the campaign starts will be too late

Associated Industries of Massachusetts has experts who can help your organization assess, evaluate and prepare for the possibility of a union campaign.  Contact our Employer Hotline at (800) 470-6277.

Topics: Organized Labor, National Labor Relations Board, Human Resources

Micro Unions Present Challenges to Employers

Posted by Michael Rudman on Jul 29, 2014 6:54:06 AM

What would happen if workers in just one department of your company want to join a union? No big deal you say – as long as those workers do not constitute a majority of employees throughout the company, they would be unable to muster enough support to force a union election.

picket.smallBut a recent National Labor Relations Board (NLRB) decision involving retail workers in Massachusetts underscores the fact that small groups of employees now have the ability to carve out “micro-unions” within a larger work force.

The NLRB recently allowed a union election to proceed within the Macy’s store located in Saugus, even though the union seeks to represent only employees who work at the cosmetics and fragrances counter - 41 of the store’s 120 workers. The federal agency relied for its decision on a 2011 ruling involving Specialty Healthcare, a rehabilitation center, where a group of nursing assistants wanted to organize.

Macy's said it was "disappointed" with the board's decision.

"Organizing a selected portion of a store's selling associates into multiple collective bargaining units is impractical and an impediment to providing a consistent level of customer service," Macy's said in a statement.

Reuters reports that the company is considering challenging the NLRB ruling in court.

The Specialty Health Care decision was initially supposed to affect only health-care facilities, but the Macy’s decision leaves little doubt that the federal government will permit micro-unions across virtually all industries. Employers face the possibility that a small percentage of their employees, within loosely-defined departmental or functional boundaries, can effectively pursue union representation.

The prospect of the NLRB subdividing a work force into mini communities of interest is a disaster for employers. Organizing smaller groups is easier, quicker and cheaper for unions than persuading full workplaces to sign up. At the same time, conflicting work rules, pay and benefits in adjacent departments make it incredibly difficult for the employer to manage.

My many decades in labor relations have taught me that employers must remain aware of the issues that can cause employees to look elsewhere for the respect, appreciation, fairness, security, wages and benefits that drive the union’s appeal. Analyze your vulnerability, create strategies to make unions unnecessary and train your team to recognize the signs of union intervention.

Topics: Organized Labor, National Labor Relations Board

Employers Must Prepare for Seismic Changes in Labor Relations

Posted by Michael Rudman on May 4, 2010 4:55:00 PM

What Do Wilma Liebman, Mark Pearce and Craig Becker have in common?

a) All are attorneys who have worked for, or represented, unions.
b) All are members of the National Labor Relations Board.
c) All have expressed opinions favoring unionization.
d) All of the above.

Answer: D, All of the Above.

This may be one of the few cases when you're not happy about passing a quiz. The newly constituted National Labor Relations Board signals a seismic change in American labor relations, one that will unleash aggressive government oversight of the way in which you deal with employees and open the door to union organizing even in well-run companies.

Wilma Liebman is the Chairperson of the National Relations Board and has been on the Board since 1997 when appointed by President Clinton.  Prior to her Board experience, she served as counsel to a number of unions including the Teamsters.  She has been recently quoted as saying that during the recent Bush Administration, "the NLRB has lost its way"

Mark Pearce was recently sworn in as a Member of the NLRB as a result of a recess appointment by President Obama.  He has represented numerous union clients such as UNITE HERE in his private labor practice.

Craig Becker was also recently sworn in as a recess appointment.  He was most recently the General Counsel for SEIU (the nation's largest union) and his controversial views in favor of unionization led to his failure to achieve Senate confirmation to the NLRB earlier this year.

Associated Industries of Massachusetts opposed the nominations of Mr. Becker and Mr. Pearce because of concerns that they might seek to implement the most troublesome sections of the proposed Employee Free Choice Act (EFCA) in an administrative manner. EFCA would deprive workers of the right to a secret ballot in union elections and replace it with a "card-check" system under which a union would gain bargaining authority by submitting card signed by more than 50 percent of workers.

"New consideration is being given to the notion that a labor friendly board might attempt to implement some elements of EFCA under the existing statutory scheme," said a February 22 article in Bloomberg Law Reports. "This new majority bloc will undoubtedly pursue expansions of all of the remedial options - regardless of whether or not EFCA is ultimately passed into law"

What does Mr. Becker believe about union-management relations? He provides clues in a 1993 Minnesota Law Review article in which he argues that traditional notions of democracy should not apply in union elections and employers should be barred from attending NLRB hearings about elections and from challenging election results even amid evidence of union misconduct.

Here are several quotes from Mr. Becker's article, Democracy in the Workplace: Union Representation and Federal Labor Law:

 "...employers should be stripped of any legally cognizable interest in their employee's election of representatives."

"...employers should have no right to raise questions concerning voter eligibility or campaign conduct"

"...employers should have no right to be heard in either a representation case (election) or an unfair labor practice case"

"The (NLRB) should return to the principle that a union election is not a contest between the employer and the union . . .Unlike the other proposals however, it could be achieved with almost no alteration to the statutory framework."

"With only eight percent of people in the private sector represented by unions, how can anyone say that we should close off or narrow the means by which employees can obtain union representation?"

"...all employer speech to employees during working hours, at the workplace, is speech to a captive audience." 

It's obviously going to be a rough ride for employers during the next several years. The most effective response to all of these developments is good management, and that's where AIM comes in. Member employers from throughout Massachusetts look to us each year to help them understand the regulations with which they comply and develop systems both to meet the regulations and improve the productivity of their operations.

I invite you to join me at one of four AIM seminars in June called The Changing Face of Labor Relations. We'll outline the changes at the NLRB, discuss the clear and present risks they pose to your enterprise and review the preventive measures to consider in reducing your vulnerability. There will be plenty of time for questions and answers.

The sessions will take place in Marlborough and Burlington on June 2, Taunton on June 8 and Chicopee on June 14.

Topics: Associated Industries of Massachusetts, AIM, Employment Law, Massachusetts employers, Organized Labor, Employee Free Choice Act

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