Hunton Employment & Labor Perspectives

Update: On March 8, 2024, the Eastern District of Texas granted summary judgment in favor of the Chamber of Commerce and struck down the NLRB’s new final joint employer rule. The opinion conducts a thorough review of the history of the joint employer standard and ultimately concludes that the Final Rule is contrary to the common law. The opinion critiques the Board’s rulemaking stating they failed to adequately address the disruptive effects of the new rule, resolve ambiguities, or explain how it will not cause piece-meal bargaining.  The opinion then leaves the previous rule from ...

The NRLB has hit another roadblock in its implementation of a new final joint employer rule (the “Final Rule”) as a Texas federal judge delayed its implementation until March 11. The Final Rule, which was supposed to take effect on February 26, would have made organizations liable for violations of the NLRA if they had direct or indirect control over the terms and conditions of employment of another firm’s employees. This change increases the potential of liability from franchising or contracting with third parties. To see more information on the implications of the Final Rule, see our previous articles here and here.

The National Labor Relations Act (“Act”) empowers the National Labor Relations Board (“Board”) to “take such affirmative action including reinstatement of employees with or without backpay, as will effectuate the policies of this Act.” 29 U.S.C. § 160(c). For much of the Board’s history, that has generally resulted in Board Orders that involve some combination of notice posting, backpay, and reinstatement.

As we previously reported here, the National Labor Relations Board (the “Board”) upended years of settled law in Tesla, Inc., 370 NLRB No. 131 (2022), when it held that employers cannot restrict employees from displaying union insignia (e.g., buttons, clothing, pins, and stickers) on their clothing at work, absent a showing of “special circumstances”—a nearly impossible standard for employers to meet.

On October 27, 2023, the National Labor Relations Board (“NLRB”) published its anticipated Final Rule modifying the standard for determining joint-employer status under the National Labor Relations Act (“NLRA”).  See Standard for Determining Joint Employer Status, 88 Fed. Reg. 73946 (October 27, 2023) (to be codified at 29 C.F.R. pt. 103).  The Final Rule overrules the NLRB’s 2020 joint-employer rule and broadly expands the definition of joint-employer.   

National Labor Relations Board (“NLRB”) General Counsel Jennifer Abruzzo recently issued a memorandum announcing her broad opposition to non-compete agreements.  In GC Memo 23-08, Abruzzo set forth her belief that, “the proffer, maintenance, and enforcement of [non-compete] agreements violate Section 8(a)(1) of the Act.”  According to Abruzzo, overbroad non-compete agreements chill employees’ abilities to exercise their Section 7 rights because the provisions interfere with employees' ability to:

• Concertedly threaten to resign to secure better working ...

The National Labor Relations Board (“Board” or NLRB) recently decided in Noah’s Ark Processors, LLC d/b/a WR Reserve, 372 NLRB No. 80 (2023) to impose extraordinary remedies upon an employer who violated a court order imposing certain collective bargaining obligations and committed multiple violations of the NLRA throughout the collective bargaining process. The extraordinary remedies included: the posting and distribution of a notice explaining employee rights under the NLRA (in addition to the standard notice that states the NLRB found NLRA violations, the violator will not commit those violations in the future, and the remedies); the reading of the notices in the presence of employees by the employer’s chief executive officer, or, if the employer prefers, by a Board agent in the presence of the CEO; and site visits by an NLRB agent to determine compliance for one year.

On March 22, 2023, the General Counsel of the National Labor Relations Board (NLRB or the “Board”), Jennifer Abruzzo, issued a memorandum providing guidance in light of the NLRB’s recent decision in McLaren Macomb, 372 NLRB No. 58 (2023). As previously reported, the Board in McLaren Macomb held that overly broad non-disclosure and non-disparagement provisions in severance agreements violate employee rights under the National Labor Relations Act (NLRA or the “Act”). The General Counsel’s memorandum—which is directed to the Board’s regional offices over which she exercises supervisory authority—seeks to clarify the scope of the McLaren Macomb decision, including: the types of provisions that may violate the NLRA; language that may be acceptable in light of the decision; whether the decision applies retroactively to previously executed severance agreements; and the potential applicability of the decision to supervisors. The memorandum is not legally binding, but it does give employers a more informed roadmap for how the Board initially will handle unfair labor practice (“ULP”) charges challenging severance agreements.

The National Labor Relations Board (“Board” or NLRB) decided in McLaren Macomb, 372 NLRB No. 58 (2023) that an employer violated the National Labor Relations Act (NLRA) by offering furloughed employees severance agreements that contained confidentiality and non-disparagement provisions. “A severance agreement is unlawful if its terms have a reasonable tendency to interfere with, restrain, or coerce employees in the exercise of their [NLRA] rights, and that employers’ proffer of such agreements to employees is unlawful,” announced the Board. In rendering the decision, the NLRB overruled Baylor Univ. Med. Ctr., 369 NLRB No. 43 (2020)[1] and IGT d/b/a Int’l Game Tech., 370 NLRB No. 50 (2020). In those cases, the Board decided that employers did not independently violate the NLRA simply by presenting employees with severance agreements containing non-assistance, non-disclosure, and non-disparagement provisions that arguably restricted NLRA rights absent some additional circumstances.

On December 16, 2022, a National Labor Relations Board (Board) majority (Members Kaplan and Ring) issued a Decision and Order holding that an employer’s conduct did not warrant setting aside a union election where the employer failed to strictly adhere to regulations requiring employers to provide unions a voter list comprised of employee names and contact information (commonly known as an Excelsior list).

Yesterday, the National Labor Relations Board (“Board” or “NLRB”) in American Steel Construction, Inc., 372 NLRB No. 23 (2022) decided that employers must meet a heightened burden to expand a voting unit sought by a union in a union election. The decision is a significant development because it makes it easier for unions to organize workforces. And it marks yet another reversal of precedent by the Board to the benefit of unions. (We’ve discussed prior reversals here and here.)

On November 4, 2022, the NLRB published a Notice of Proposed Rulemaking (“NPRM”) inviting public comment on a proposal that would rescind and replace the current “Fair Choice and Employee Voice” rule which was adopted by the prior Board-majority on April 1, 2020.  Three distinct policies regarding election-blocking charges, voluntary recognition, and construction industry bargaining relationships are under consideration.  The Board’s stated intent is to return the law in each of these three areas to that which existed prior to the April 1, 2020 rule. 

On September 7, 2022, the NLRB released a Notice of Proposed Rulemaking (“NPRM”) and request for public comment regarding its latest iteration of the joint employer rule.  The NPRM proposes to rescind and replace the current final rule, entitled “Joint Employer Status Under the National Labor Relations Act,” which took effect on April 27, 2020.

Earlier this week, the National Labor Relations Board (“Board” or “NLRB”) decided that employers cannot restrict employees from displaying union insignia (e.g., buttons, clothing, pins, and stickers) absent a showing of “special circumstances” in Tesla, Inc., 370 NLRB No. 131 (2022).  In connection with this ruling, the Board overruled Wal-Mart Stores, Inc., 368 NLRB No. 146 (2019), which analyzed the lawfulness of facially neutral work rules that regulated the size and appearance of such union insignia under a less exacting standard.  Employers with policies that address employee appearance, such as dress code or uniform policies, should review those policies for compliance purposes in light of Tesla.

The National Labor Relations Board (“NLRB” or “Board”) recently indicated an openness to revisiting the independent contractor standard employed by the Board when assessing whether individuals are covered under the National Labor Relations Act (“Act”).

The National Labor Relations Board indicated in January that it may reconsider its legal standard for assessing whether employer work rules violate the National Labor Relations Act, and invited amicus briefs on the subject.  Several business groups, including the Chamber of Commerce of the United States of America, filed briefs on March 8, 2022 urging the Board to maintain its existing standard under The Boeing Co., 365 NLRB No. 154 (2017).

On September 8, 2021, the House Education and Labor Committee issued proposed legislation in connection with the House’s new spending bill. Among other pro-union proposals issued in connection with the Protecting the Right to Organize (PRO) Act, the proposed legislation seeks to amend the National Labor Relations Act (NLRA) by banning class and collective action waivers.

The proposed legislation says that no employer shall “enter into or attempt to enforce” any express or implied agreement not to “pursue, bring, join, litigate, or support any joint, class, or collective claim” arising from the employment relationship.   This is unwelcome news to employers who rely on class and collective action waivers in their arbitration agreements.

On June 1, 2021, the U.S. Court of Appeals for the D.C. Circuit overturned a NLRB determination that a manager’s incorrect blaming of a union for discrepancies in an employee’s paid-leave time constituted an unfair labor practice. The pivotal issue was whether the manager’s statements had a reasonable tendency to interfere with employees’ labor rights. As discussed below, the D.C. Circuit rejected the NLRB’s determination that the manager’s statements had a reasonable tendency to interfere with employees’ labor rights, reasoning that the manager’s misstatements were lawful expressions of the employer’s opinions.

It is early in 2021 and already the NLRB has before it ALJ determinations that employee handbook policies conflict with the NLRA. When analyzing employee handbook policies, the Board generally applies the Boeing test, whereby a handbook policy’s potential interference with employee rights under the NLRA is balanced against an employer’s legitimate justifications for the policy, when viewing the policy from the employee’s perspective. While the NLRA and the Boeing test apply to a number of employee handbook policies, confidentiality, social media, and solicitation/distribution policies are especially vulnerable.

On December 21, 2020 the NLRB adopted an ALJ’s determination that a union’s request for information about non-bargaining unit employees was relevant. One of the issues present in the case was whether a union’s request for information about non-bargaining unit employees sought relevant information. As discussed below, the NLRB upheld the ALJ’s determination that the information was relevant solely because the employer should have known the information was relevant based on the circumstances surrounding the request.

The COVID-19 pandemic continues to cause uncertainty for employers across the country, but, as the National Labor Relations Board reiterated on September 18, it does not excuse labor law violations.

NLRB General Counsel Peter Robb issued General Counsel Memo 20-14 to summarize the types of COVID-related complaints that he has advised the agency to pursue since March 2020.  The theme is clear: in the vast majority of cases, the traditional rules of the National Labor Relations Act apply, even during a pandemic.

Earlier this month, the NLRB General Counsel released a guidance memo urging the Board to apply the “more than ministerial aid” standard when evaluating whether an employer’s assistance in union organizing violates the National Labor Relations Act.

An employer violates Section 8(a) of the NLRA when it provides impermissible support to a union attempting to organize unrepresented employees, and Section 8(b) when it provides impermissible support to employees seeking to decertify or withdraw from a union.  Under current Board precedent, what constitutes “impermissible behavior” under Section 8(a) and 8(b) is governed by two different standards.  When an employer is accused of impermissibly supporting a union’s organizing efforts there’s a “totality of the circumstances” standard.  And, when an employer is accused of impermissibly supporting a decertification petition there’s a “more than ministerial aid” standard.  The application of these different standards to similar employer behavior yielded inconsistent conclusions for what is “impermissible” employer involvement in union organizing. Therefore, the General Counsel now urges the Board to adopt the “more than ministerial aid” standard for both situations.

On July 27, 2020 the NLRB issued a supplemental decision involving a labor law successor employer, which unilaterally implemented terms and conditions of employment prior to commencing operations. The question presented was whether and to what extent the successor could take further unilateral action, free of the duty to bargain with the union. As discussed below, the Board determined that the applicable standard in such cases is whether the successor’s unilateral action was “reasonably encompassed” by the unilaterally imposed terms.

Over the past 40 years, the National Labor Relations Board (the Board) has grappled with the appropriate balance between an employer’s right to discipline an employee for abusive behavior and an employee’s right to engage in Section 7 activity. Much to the dismay of employers, this balancing act has historically tipped heavily in favor of protecting an employee’s right to engage in Section 7 activity at the expense of an employer’s right to discipline its employees for conduct such as using racial slurs while picketing, engaging in sexist behavior, or yelling obscenities at a supervisor while discussing wages. As a result, the Board has issued countless decisions finding an employer violated the National Labor Relations Act (the Act) for disciplining employees who engage in objectively offensive, racist, and abusive conduct while also engaged in Section 7 activity.

Almost overnight, COVID-19 has radically altered the American workplace.  Employers and employees alike have been forced to adapt to unique issues related to employee health, compensation, leave, and in unfortunate circumstances, furlough or lay-off.

Such change may be accompanied by grievances, concerns, and fears.  And in some instances, employees will desire to communicate those anxieties to the greater public at large.  Naturally, employers will want to have some degree of control over this messaging, while preserving the rights of employees to express themselves individually or collectively.  These principles are sometimes difficult to reconcile.  But a recent NLRB decision, Karen Jo Young v. Maine Coast Regional Health Facilities, issued on March 30, illuminates some fundamental principles that can help employers manage this balance during these difficult circumstances.

Factual Summary

An employer’s duty to bargain may change during emergency situations, and the General Counsel for the National Labor Relations Board released a series of case summaries Friday to help employers navigate the exceptions.

General Counsel Peter Robb summarized nine Board cases addressing both general public emergencies and emergencies particular to individual employers.  Robb did not make any declarations about how the COVID-19 outbreak and associated response might affect bargaining obligations, but the summarized cases provide good examples of bargaining exceptions that may or may not apply.

In Country Wide Financial Corporation, 369 NLRB No. 12 (2020) (Countrywide), the National Labor Relations Board (“Board”) ruled that an mandatory arbitration agreement violated the National Labor Relations Act (the “Act”) because it restricted an employees’ ability to file and pursue unfair labor practice charges before the Board.

Yesterday, the National Labor Relations Board published a final rule modifying its representation case procedures.

The final rule takes effect April 17, 2020, and scales back—but does not completely undo—the changes to election regulations instituted by the Obama-era’s Board that have caused employers heartburn since 2015. Those changes effectively sped up the election process and cut down on employers’ ability to litigate many important legal issues prior to voting, putting employers at a disadvantage.

A recent decision by the National Labor Relations Board is another in a string of decisions where the Trump-appointed Board has attempted to rebalance a property owner’s rights with the rights under Section 7 of the National Labor Relations Act of those individuals who work on the property. In Bexar County Performing Arts Center Foundation d/b/a Tobin Center for the Performing Arts, 368 NLRB No. 46 (2019), the Board overruled its previous precedent and held that a property owner may prohibit Section 7 activity by off-duty employees of a licensee or contractor performing work on the property owner’s premises.

In Cordúa Restaurants, Inc., 368 NLRB No. 43 (2019), the National Labor Relations Board (“Board”) issued its first major decision following the Supreme Court’s 2018 ruling in Epic Systems, addressing a number of issues of first impression and providing guidance on the permissible scope and implementation of class action waivers.  

 In Cordúa, a group of employees had filed a collective action under the FLSA.  In response, the employer promulgated and maintained a revised arbitration agreement, requiring employees to agree not to opt in to class or collective actions.  In distributing the revised agreement, the employer explained that employees would be removed from the work schedule if they declined to sign it.  In addition, another employee was discharged for filing a class action wage lawsuit against the employer and discussing wage issues with his fellow employees.

The National Labor Relations Board has issued the first part of its planned series of revisions to labor union election procedures.  The revisions arrive five years after the Obama-era Board’s controversial 2014 changes that created the so-called “ambush election” procedures.

On August 12, a three-member majority, over a one-member dissent, issued a 113-page proposed rule that would modify three of the Board’s election processes: (1) its handling of “blocking charges,” (2) the restriction on elections after an employer’s voluntary recognition of a union, and (3) the standard for contractually-negotiated recognition of a union in the construction industry.

In Johnson Controls, Inc., 368 NLRB No. 20 (July 3, 2019),  the NLRB adopted a new framework for determining a union’s representative status once an employer has made a lawful anticipatory withdrawal of recognition based on disaffection evidence that the union has lost its majority status. Specifically, under Johnson Controls, a union seeking to demonstrate that it has reacquired majority status must do so in a secret ballot election conducted by the Board, rather than in an unfair labor practice proceeding.

The Board’s recent decision in Merck, Sharp, & Dohme Corp., 367 NLRB No. 122 (May 7, 2019)  highlights the differences that can arise as a result of the collective bargaining process in the terms and conditions of employment for employers with a divided workforce of non-union and union-represented employees.

In Merck, the Board majority reversed the Administrative Law Judge’s ruling that the employer had violated Section 8(a)(3) and (1) by offering a new, one-time paid holiday, “Appreciation Day” to all of its non-union employees to the exclusion of its union-represented employees.

Here are some factual background and key points of the NLRB’s decision in Merck:

Many workplace policies and employee handbooks contain restrictions on employees speaking to the media.  Through these policies, employers often seek to limit what organizational information is disclosed to third parties, and to exercise at least some control over statements that may be attributed to the company.  Such restrictions, though, may be found to violate employees’ rights under the National Labor Relations Act (“the Act”) due to overbreadth when not drafted carefully.  And, while the National Labor Relations Board in the Trump era has seemed willing to revisit pro-worker rulings, the General Counsel last month released an Advice Memorandum affirming this long-standing precedent.

In a 3-1 decision released last week, the National Labor Relations Board reversed decades of precedent regarding a successor employer’s bargaining obligations following the purchase of an entity with a unionized workforce. The Board’s decision in Ridgewood Health Care Center significantly reined in the application of the “perfectly clear successor” doctrine, which requires a successor employer to maintain the status quo of its predecessor employer’s terms and conditions of employment.

Before the lame duck period of the 115^th Congress, Rep. Jerrold Nadler (D-NY) and a group of 58 Democrat co-sponsors, introduced the Restoring Justice for Workers Act (H.R. 7109), which would prohibit  employers from requiring employees to sign mandatory arbitration agreements.

In a highly anticipated decision, the U.S. Supreme Court ruled that public employee unions may not collect involuntary fees from the public employees they represent.  Janus v. AFSCME, U.S., No. 16-1466, 6/27/18.  Here are the key points of the court’s decision:

Janus involved state employees represented in a bargaining unit by an Illinois public employee union.  The union was the exclusive collective bargaining representative of all the employees in a bargaining unit.  The union bargained with the State of Illinois for a collective bargaining agreement covering the employees in bargaining unit.  The union also engaged in other activities not directly related to the bargaining and administration of the collective bargaining agreement.

On April 16, newly confirmed member John Ring was sworn in as the fifth member and Chairman of the National Labor Relations Board, establishing a Republican-controlled Board.   While all has been relatively quiet with regard to rulings from the Board,  we will likely see a rise in activity now that the NLRB (with a  newly-minted majority) is poised to roll back some of the Obama-era rulings.

Recently the National Labor Relations Board invited interested parties and amici to submit briefs in Velox Express, Inc. (15-CA-184006) to address under what circumstances, if any, the Board should deem an employer’s misclassifying statutory employees as independent contractors constitutes a violation of Section 8(a)(1) of the National Labor Relations Act (“the Act”).  Briefs from parties and interested amici must be submitted on or before April 16, 2018.

On December 14, 2017, in a 3-2 decision along party lines, the National Labor Relations Board (the “Board”) issued a decision in The Boeing Company, 365 NLRB No. 154 (2017) case.  This is a significant and long-awaited victory for employers grappling with unfair labor practice charges stemming from facially neutral workplace rules and signals the Board’s intent to retreat from regulating non-union activity.  Specifically, Boeing  rescinds the onerous workplace rule standard in Lutheran Heritage Village-Livonia, 343 NLRB 646 (2004) in favor of a new, more rational test.

Two recent rulings have labor law observers questioning where the line is in disciplining employees for making offensive or obscene comments toward their employer. Seemingly at odds are a recent Second Circuit ruling finding such behavior is protected activity under the NLRA and a recent NLRB ruling finding the use of profanity towards management is not protected.

[From Hunton’s Retail Blog]  If you are a retailer, you may have policies and procedures in place regarding who can speak on behalf of your company. Such policies may generally instruct employees not to speak to the press as a representative of the company, and to direct all media inquiries to a particular person or department. Similarly, if you are a retailer, you may have a policy in place that instructs employees to forward any reference requests to your human resources department. These commonplace policies allow retailers to control their public image and protect employee ...

The United States Supreme Court has granted consolidated review of three cases to determine whether arbitration agreements that waive employees’ rights to participate in a class action lawsuit against their employer are unlawful. The Court’s decision to address the uncertainty surrounding class action waivers of employment claims follows a circuit split last year in which the Fifth and Eighth circuits upheld such waivers and the Seventh and Ninth circuits found that such waivers violate the National Labor Relations Act. Given the increasingly widespread use of class action waivers by employers to stem costly class and collective actions, the high court’s ruling is likely to have a significant nationwide impact.

A common misconception among banks and financial services companies is that if they are non-unionized, the National Labor Relations Act does not apply to them. Hunton & Williams LLP partner Emily Burkhardt Vicente and senior attorney Amber Rogers discuss the key points non-unionized financial services companies should know about the NLRA.

View the 5-minute video here.

A common misconception among banks and financial services companies is that if they are non-unionized, the National Labor Relations Act does not apply to them. Hunton & Williams LLP partner Emily Burkhardt Vicente and senior attorney Amber Rogers discuss the key points non-unionized financial services companies should know about the NLRA.

View the 5-minute video here.

With its May 26 Lewis v. Epic-Systems Corp. decision, the Seventh Circuit became the first circuit to back the reasoning in D.R. Horton, Inc., 357 NLRB No. 184 (2012), and held that a mandatory arbitration agreement prohibiting employees from bringing class or collective actions against their employer violates the National Labor Relations Act (NLRA). This decision creates a circuit split regarding the enforceability of arbitration agreements with class action waivers in the employment context, and the issue is now ripe for potential Supreme Court review.

Sitting as the lone dissenter on the National Labor Relations Board (NLRB) might seem like a futile exercise. Grinding away on opinions that are critiques of the law as stated by your colleagues can be disenchanting work. But as a former NLRB member, I can attest that dissents are also valuable tools for future board members and the courts. Indeed, one of my proudest moments as a lawyer came when a court of appeals reversed the board “for the reasons stated by Member Meisburg.”

A recent NLRB decision involving an employer’s work rules illustrates the value of a powerful dissenting ...

In Dover Energy, Inc., Blackmer Division v. National Labor Relations Board, the Board held that Blackmer violated section 8(a)(1) of the National Labor Relations Act (“NLRA”) when it threatened Tom Kaanta, a Blackmer employee and United Auto Workers Union shop steward, with disciplinary action if he continued to make “frivolous” information requests to the company’s lead negotiator during collective bargaining agreement (“CBA”) negotiations. On March 22, 2016, the U.S. Court of Appeals for the D.C. Circuit reversed and held that the NLRB’s factual findings were not supported by substantial evidence.

On January 20, 2016, the administrator of the Department of Labor’s Wage and Hour Division (WHD), David Weil, issued an “Administrator’s Interpretation” (AI) regarding the agency’s interpretation of joint employment under the Fair Labor Standards Act (FLSA) and the Migrant and Seasonal Agricultural Worker Protection Act (MSPA). The new AI purports to clarify the WHD’s position that joint employment under these statutes “should be defined expansively.” When considered alongside the National Labor Relations Board’s (NLRB or the Board) controversial ...

In the second half of December 2015, the National Labor Relations Board (“NLRB”) issued 16 rulings on the illegality of mandatory arbitration agreements containing class and collective action waivers, even in situations where the agreements allow employees to opt out of, or into, the waiver. The NLRB continues to hold firm that these types of waivers violate the National Labor Relations Act (“NLRA”) because they infringe upon the employees’ protected right to engage in concerted activity—despite the U.S. Supreme Court’s continued favoring of class action waivers, see, e.g., DirecTV, Inc. v. Imburgia, 577 U.S. __, 135 S. Ct. 1547 (2015), and the Fifth Circuit’s express rejection of the NLRB’s position in D.R. Horton, Inc. v. NLRB, 737 F.3d 344 (5th Cir. 2013), and in Murphy Oil USA, Inc. v. NLRB, No. 14-60800, 2015 U.S. App. LEXIS 18673 (5th Cir. Oct. 26, 2015).

In 2015 the National Labor Relations Board (the “Board”) issued two opinions, Cook Inlet Tug & Barge, Inc. and Buchanan Marine, L.P., each finding that tugboat captains did not qualify as “supervisors” for the purposes of the National Labor Relations Act (the “Act”). These decisions demonstrate a trend in recent Board decisions narrowing the definition of a supervisor.

Under Section 2(11) of the Act, a supervisor must have the authority to perform one of several enumerated functions, including “assigning” or “responsibly directing” employees, using “independent judgment” in the interest of the employer. In 2006, the Board issued three decisions defining these terms. Oakwood Healthcare, 348 NLRB No. 37 (2006); Croft Metals, Inc., 348 NLRB No. 38 (2006); Golden Crest Healthcare Center, 348 NLRB No. 39 (2006).

On December 24, 2015, the National Labor Relations Board (“NLRB” or the “Board”) held that rules in Whole Foods’ General Information Guide prohibiting unapproved tape and video recording in the workplace violate Section 8(a)(1) of the National Labor Relations Act (“NLRA” or the “Act”).

A rule violates Section 8(a)(1) if it would reasonably tend to chill employees’ exercise of their Section 7 rights, including the right to engage in protected concerted activity. If the rule in question explicitly restricts activity protected by Section 7, it is automatically unlawful; if it does not, the rule violates Section 8(a)(1) only if: (1) the employees would reasonably construe the rule’s language to prohibit Section 7 activity; (2) the rule was promulgated in response to union activity; or (3) the rule was applied to restrict the exercise of Section 7 rights.

As we have reported in this space, the National Labor Relations Board (“Board”) made waves several weeks ago with its highly controversial new test for determining if an entity is a “joint employer” of another entity’s employees. Browning-Ferris Industries of California, Inc., 362 NLRB No. 186 (2015). The Board has wasted no time in seeking to extend its new test to the health care industry.

In a ruling that redefines the concept of employment in the United States, the National Labor Relations Board yesterday issued its much-anticipated decision in Browning-Ferris Industries of California, Inc. d/b/a Newby Island Recyclery, 362 NLRB No. 186 (2015). The decision rewrites and drastically expands the definition of who is a “joint employer” under the National Labor Relations Act. Businesses have been bracing for this decision for several months, and now that it has been released, it appears their worst fears have been realized.

On August 17, the NLRB declined to assert jurisdiction over Northwestern University’s scholarship football players, holding that doing so “would not serve to promote stability in labor relations.” The Board dismissed the election petition filed by the Steelworkers-backed “College Athletes Players Association” (CAPA) and directed that the ballots (which were uncounted and had been impounded) be destroyed. Although the outcome obviously pleased Northwestern (and the Big Ten, other bowl subdivision conferences and the NCAA), the Board’s opinion leaves key questions unanswered. Among these are whether college scholarship football players should be deemed employees; why the NLRB took the case in the first place given its view that it would be nearly impossible to effectively regulate labor relations in the Big Ten; and why CAPA targeted Northwestern. A summary of key rulings and some observations follow below.

On July 29, 2015, the U.S. District Court for the District of Columbia held that the National Labor Relations Board (“NLRB”) had authority to adopt its new “ambush election” rules. These new rules, which became effective on April 14, 2015, made dramatic changes to the NLRB’s traditional rules governing union representation elections. The rules shortened the length of representation elections from approximately 40 days to as short as 11 days. In addition, the rule prevents employers from legally challenging an election until after its workers have voted. Business groups across the country have now begun the process of challenging these rules in federal courts. As we previously reported, the U.S. District Court for the Western District of Texas has already dismissed one set of petitioners’ challenges and upheld the ambush election rules. However, on August 10, the petitioners filed an appeal asking the Fifth Circuit to overturn the decision.

Federal contractors and subcontractors may soon be prohibited by the OFCCP from having polices that prohibit employees from talking about their pay and from discriminating against those who do.  On September 17, the Labor Department’s Office of Federal Contract Compliance Programs (OFCCP) published a notice of proposed rule-making (NPRM) concerning pay secrecy policies. The proposed rule, which applies to  federal contractors and subcontractors, prohibits pay secrecy policies and bars companies from discriminating against job applicants and all levels of employees who ask about, disclose, or discuss compensation-related information.  This will not be a surprise to those who follow the rulings under the National Labor Relations Act (NLRA), which provides similar protections.

Consistent with a trend in assailing employers’ workplace policies, the NLRB recently struck down nine employee policies, and  the confidential information and non-disclosure agreement of Hoot Winc LLC (d/b/a Hooters), all of which employees signed upon initial hiring.  NLRB Judge William Nelson Cates found that the policies at issue, which dealt with discussion of tips, employee conduct, disclosure of company material and business affairs, and social media, were over-broad and interfered with employees’ rights to engage in  activity protected by Section 7 of the National Labor relations Act (“Act”).  Likewise, the judge found that the restaurant chain’s non-disclosure agreement also infringed on employees’ Section 7 rights.

You're Invited: Pay Equity Under The Obama Administration

Pay equity for women and minorities has been a priority throughout President Obama’s administration. President Obama has wielded his Executive power with increasing frequency in 2014. President Obama recently issued an Executive Order and a Presidential Memorandum that target the pay practices of federal contractors. Both actions are designed to increase transparency in employee compensation. They may have significant consequences for covered employers.

We have been reporting in this space for the better part of a year about the uptick in NLRB enforcement activity in non-union workplaces.  One of the Board’s most noteworthy – and controversial – areas of focus has been on the question whether employer confidentiality rules unlawfully chill protected concerted employee activity under the National Labor Relations Act.  Last week, for the first time, a U.S. Court of Appeals agreed with the Board that certain confidentiality restrictions can have such an effect.

The U.S. District Court for the District of New Jersey recently ruled that non-public Facebook wall posts are protected under the Federal Stored Communications Act (the “SCA”) in Ehling v. Monmouth-Ocean Hospital Service Corp., No. 2:11-CV-3305 (WMJ) (D.N.J. Aug. 20, 2013).  The plaintiff was a registered nurse and paramedic at Monmouth-Ocean Hospital Service Corp. (“MONOC”).  She maintained a personal Facebook profile and was “Facebook friends” with many of her coworkers but none of the MONOC managers.  She adjusted her privacy preferences so only her “Facebook friends” could view the messages she posted onto her Facebook wall.  Unbeknownst to the plaintiff, a coworker who was also a “Facebook friend” took screenshots of the plaintiff’s wall posts and sent them to a MONOC manager.  When the manager learned of a wall post in which the plaintiff criticized Washington, D.C. paramedics in their response to a museum shooting, MONOC temporarily suspended the plaintiff with pay and delivered a memo warning her that the wall post reflected a “deliberate disregard for patient safety.”  The plaintiff subsequently filed suit alleging violations of the SCA, among other claims.

EMPLOYMENT DECISIONS

Vance v. Ball State University: Narrow Definition of Supervisor in Harassment Suits
In Vance, the Supreme Court announced a narrow standard for determining which employees constitute “supervisors” for purposes of establishing vicarious liability under Title VII. In a 5-4 decision, the Court decided that a supervisor is a person authorized to take “tangible employment actions,” such as hiring, firing, promoting, demoting or reassigning employees to significantly different responsibilities. The majority opinion rejected the EEOC’s ...

Last week, in American Express Co. v. Italian Colors Restaurant, the United States Supreme Court, in a 5-3 ruling, reversed the Second Circuit and held that a contractual waiver of class arbitration is enforceable under the Federal Arbitration Act (FAA) even if the cost of proving an individual claim in arbitration exceeds the potential recovery.  In holding that a class action waiver in an arbitration agreement is enforceable, even as to federal anti-trust claims, this decision builds upon the trend set in Stolt-Nielsen S.A. v. AnimalFeeds Int'l Corp., 559 U.S. 662 (2010), AT & T Mobility LLC v. Concepcion, 131 S. Ct. 1740 (2011), and CompuCredit Corp. v. Greenwood, 132 S. Ct. 665 (2012) – that arbitration agreements should be enforced according to their terms even for claims under federal statutes.

On May 7, 2013, a three-judge panel of the U.S. Court of Appeals for the District of Columbia Circuit invalidated a rule promulgated by the NLRB that would have required employers to post notices of employee’s rights under the National Labor Relations Act (“NLRA”) in the workplace.  According to the Court, employers have the right not to speak, and thus can be silent, on these issues.  Another case regarding the same issue is currently pending on appeal in the Fourth Circuit.

Furthering its controversial ruling in Banner Health System d/b/a Banner Estrella Medical Center, 358 NLRB No. 93 (July 30, 2012), the National Labor Relations Board’s Office of the General Counsel recently released a memorandum providing additional guidance on the confidentiality of internal workplace investigations.  Banner Health held that to require confidentiality of investigations, an employer must show more than a generalized concern with protecting the integrity of its investigations.  Rather, an employer must “determine whether in any give[n] investigation witnesses need[ed] protection, evidence [was] in danger of being destroyed, testimony [was] in danger of being fabricated, and there [was] a need to prevent a cover up.”

In numerous prior posts, we have reported about the pro-labor decisions and regulatory changes by the Democratic-majority National Labor Relation Board.  Unfortunately, the Board is at it again, this time in WKYC-TV, Inc., 359 NLRB No. 30 (2012) , reversing a fifty-year-old precedent regarding the effect of contract expiration on a dues checkoff clause contained in the expired contract.

The National Labor Relations Board’s (“NLRB”) General Counsel recently released an analysis of contested at-will employment clauses in two employment handbooks and ultimately concluded that neither violated the National Labor Relations Act (“NLRA”).

Employees had filed charges with the NLRB alleging that the at-will employment clauses contained in the employee handbooks distributed by Rocha Transportation, a California trucking company, and SWH Corporation d/b/a Mimi’s Café, a restaurant in Arizona, defined at-will employment so broadly that employees would reasonably think that they could not engage in activity protected by the NLRA.  The clause contained in Rocha Transportation’s handbook advised its employees that their employment is at-will and may be terminated at any time.  It also stated that “No manager, supervisor, or employee of Rocha Transportation has any authority to enter into an agreement for employment for any specified period of time or to make an agreement for employment other than at-will.  Only the president of the Company has the authority to make any such agreement and then only in writing.”  Mimi’s Café’s description of at-will employment in its handbook included the sentence: “No representative of the Company has authority to enter into any agreement contrary to the foregoing “employment at will” relationship.”  The NLRB’s Division of Advice prepared two memos which found that each of the clauses described above were lawful.

On September 20, 2012, Administrative Law Judge Clifford H. Anderson struck down telecommunications company EchoStar Corp.’s policy prohibiting employees from making disparaging comments about it on social media sites. The NLRB judge found that the prohibition, as well as a ban on employees using social media sites with company resources or on company time, chilled employees’ exercise of their rights under Section 7 of the National Labor Relations Act (“NLRA”). The EchoStar decision comes on the heels of the NLRB’s recent ruling striking down Costco Wholesale Corp.’s policy barring employees from posting statements online that were harmful to the company’s reputation.

The NLRB has again asserted its willingness to encroach upon employers’ long standing legitimate employment policies in a non-unionized workforce.  In Banner Health System, 358 NLRB No. 93 (July 30, 2012), the Board held that a blanket policy prohibiting an employee from discussing an ongoing investigation violates section 8(a)(1) of the National Labor Relations Act.

In recent years, the National Labor Relations Board (NLRB) and unions have placed a growing emphasis on extending the application of labor law into the social media arena.  As part of this initiative, the NLRB has adopted a strong stance against social media policies that it believes pose a threat to employees’ right to engage in protected activities under Section 7 of the National Labor Relations Act (NLRA).

While “employees” have the right to form, join, or assist labor organizations under the National Labor Relations Act (NLRA), supervisors are not employees under the statute and do not have the same rights.  Under current case law, “supervisor” is interpreted broadly and employees who merely assign duties to other employees on a daily basis are statutory supervisors under the Act.  As expected and as we previewed in a prior posting, Senate Democrats recently announced new legislation that would narrow the definition of “supervisor” under the NLRA, increasing the number of workers eligible to join unions.

In several prior blog entries, we told you about the NLRB’s new requirement that employers post a notice regarding employee rights under the NLRA.  Employers have been following the story with interest.

Initially proposed by the NLRB in December 2010, the new posting tells employees about their rights under the National Labor Relations Act (“NLRA”).  The new requirement initially had an effective date of November 14, 2011, but it has been delayed several times.  The NLRB first delayed implementation until January 31, 2012, to allow “for further education and outreach.”  Then, several industry groups and businesses filed federal lawsuits in South Carolina and Washington, D.C., challenging the NLRB’s Final Rule.  The groups argued the NLRB did not have statutory authority to issue the notice requirement.  While the lawsuits were pending, in the District of Columbia and South Carolina, the NLRB agreed to further delay implementation until April 30, 2012.

In prior postings, we have reported about the potential effects that the National Labor Relations Board’s (“NLRB”) recent pro-labor composition could have on non-union employers and how it will become increasingly easier for unions to organize employees as a result of the NLRB’s recent decisions and procedural changes.  This posting focuses on the convergence of two potential developments – the likely change in the definition of “supervisor” under the National Labor Relations Act (the “Act”) and the NLRB’s recent proposal to expedite the procedures for union elections – and how these two developments combined could hamper an employer’s ability to effectively oppose a union-organizing campaign.

Several of our recent posts have addressed the sharp criticism directed towards President Obama in response to his recent recess appointments to the NLRB.  A new case filed in the Eastern District of New York may result in one of the first court rulings involving a challenge to the President’s authority to have made the appointments.  In Paulsen v. Renaissance Equity Holdings, LLC, No. 1:12-cv-00350-BMC, a case in which the NLRB is seeking a federal court injunction to declare an end to an employer lockout, the Defendant is contesting the action on the grounds that because three of the Board’s five members have not been validly appointed, the Board has no authority to act.

Last week, the NLRB’s Acting General Counsel, Lafe Solomon, released a second report containing guidance relating to employees’ use of social media.  This report comes less than six months after the release of the NLRB’s first report on the subject in August 2011.  Like the August report, the new release summarizes a number of recent cases decided by the NLRB in which an employee was terminated, at least in part, because of his or her comments on social media websites.

Two members of the National Labor Relations Board recently held that employers may not require employees to enter into arbitration agreements, as a condition of employment, that waive the ability to pursue class or collective claims. The Board’s ruling does not sound the death knell for class action waivers, however, as many Plaintiff’s lawyers have touted.

On December 20, 2011, the National Labor Relations Board (the “Board”) finalized what is being referred to by some critics as the “ambush election rule,” following its contentious November 30, 2011 2-1 vote in favor of its proposed revisions to the procedures by which it conducts workplace elections to determine whether employees do or do not wish to unionize.

The focus on social media by the National Labor Relations Board (“NLRB” or the “Board”) continues as evidenced by its recent report issued by Acting General Counsel Lafe Solomon.  The report discusses fourteen social media cases that were decided by the Board after Regional Directors submitted requests for advice to the Board’s Division of Advice.  The cases highlighted by Solomon give some insight to how the NLRB will handle various social media issues in the future.

The NLRB announced today it has issued a Final Rule requiring employers to notify employees of their rights under the National Labor Relations Act (“NLRA”). A Fact Sheet  is also available. The rule is scheduled to be published in the Federal Register on August 30, 2011. It is effective November 14, 2011.

First introduced in the Employee Free Choice Act as an alternative to card check, the quickie election has been brought back as part of the National Labor Relations Board’s (“NLRB”) rulemaking process.  On June 21, 2011, the NLRB, with Board Member Brian Hayes dissenting, issued a Notice of Proposed Rulemaking suggesting numerous changes to the procedures governing union elections.  These proposed changes are significant and if accepted would both alter the landscape of secret ballot elections and place employers at a severe disadvantage.

On December 21, 2010, the NLRB issued a press release and fact sheet announcing its intention to publish in the Federal Register a proposed “rule” requiring virtually all private sector employers to post in the workplace a Notice to employees outlining their rights under the National Labor Relations Act. The proposed poster was published in the Federal Register on December 22, 2010.   Interested parties will have sixty (60) days from December 22nd to respond with comments regarding the proposed rule.

Employees are increasingly talking about supervisors and other employees on social networking sites, and sometimes the talk can get nasty.  Complaining about co-workers and supervisors is not new.  However, distributing those complaints via the internet is.  Employers often seek to crack down on such negative talk via policies and disciplinary action.  However, Lafe Solomon, the NLRB’s acting general counsel, has publicly stated that employees have the right to communicate jointly about working conditions, regardless of whether those communications are made on social networking sites or at the company water cooler.  The NLRB will decide the validity of Mr. Solomon’s statement in connection with a recently-issued complaint.

The Eleventh Circuit recently ruled that an employee had standing to seek an injunction against his employer and a labor union over alleged violations of the Labor Management Relations Act (“LMRA”) in the union organizing context.  In Mulhall v. UNITE HERE Local 355, Hollywood Greyhound Track, Inc., d.b.a. Mardi Gras Gaming, (No. 09-12683, September 10, 2010), the Eleventh Circuit reversed the lower court’s dismissal of the case, overruling its decision that the employee lacked a cognizable injury, and remanded the case for further proceedings.

How would you handle the following situation?  You have recently learned that one of your employees “posted” on Facebook complaining about the company, specifically commenting on work conditions and wages.  Several other employees have made comments on this employee’s Facebook page and a discussion has ensued.  These comments and complaints are damaging to the company’s reputation and portray the company in a negative light. 

Your natural inclination may be to instruct the employee to take these comments down and prohibit him from continuing to use Facebook to discuss work issues.  Yet, unions may be looking for you to do exactly that so they can try to file an unfair labor practice charge with the National Labor Relations Board (“NLRB”).  Employers have the right to protect their reputations and to prevent the possible disclosure of confidential information.  But unions may try to construe the above situation and the employer’s reaction to it as interference with an employee’s right to engage in concerted activity, a violation of Section 8 of the National Labor Relations Act (“NLRA”).  Notably, such an argument by unions could apply to both unionized and non-unionized employers. 

Pundits in the labor arena have speculated for months that the Administration’s recent appointment of union-friendly Board candidates like former SEIU Assistant General Counsel Craig Becker could have a significant impact on the state of Board precedent in future cases.  If the Board’s highly anticipated recent decision in United Brotherhood of Carpenters and Joiners of America, 355 NLRB No. 159 (“UBC”), is any indication, the pundits may be right.

Two significant developments last week affect the functioning of the country's federal agency in charge of overseeing union-management relations. The first is a decision by the US Supreme Court and the second is the resignation of the agency's general counsel effective June 18th.

As a result of political disagreements over nominations to fill vacancies on the National labor Relations Board, the Board operated with only two of its five members during 2008, 2009 and into 2010.  During that time, the two members decided almost 600 cases (though most were not particularly controversial from the standpoint of illuminating policy or setting precedent).  On June 17, the Supreme Court ruled in New Process Steel v. National Labor Relations Board, No. 08-1457, that the two members did not have the authority to decide those cases because they did not constitute a proper quorum under the National Labor Relations Act.  Instead, the Court ruled that at least three sitting Board members were required for the NLRB to act.  The ruling nullifies the decisions made in all 600 cases and effectively remands the cases back to the Board for re-adjudication.

On May 21st, we reported on the newly-announced Department of Labor (“DOL”) proposal to narrow the “advice exception” to the reporting requirements of section 203 of the Labor-Management Reporting and Disclosure Act (“LMRDA”).  In a nutshell, section 203 requires employers to annually report any arrangement with a third-party consultant to persuade employees as to their rights to organize and bargain collectively or to obtain certain information concerning the activities of employees or a labor organization involved in a labor dispute with the employer.  The “advice exception” of section 203(c) provides that no annual report need be filed when a consultant gives “advice” to the employer.  DOL’s current policy is to construe this exception broadly to exclude arrangements where the consultant has no direct contact with employees, but DOL now views this policy as overbroad and seeks to narrow it through rulemaking, as outlined in its Spring 2010 Regulatory Agenda.

The Secretary of Labor has finalized implementing regulations under Executive Order 13496, which requires federal contractors and subcontractors covered by the National Labor Relations Act (NLRA) to post a new notice advising employees of their rights under the Act.  Note that most employers in the private sector are covered by the NLRA; the Order is not limited to companies with union activity or representation.

The regulations are codified at Title 29, Part 471 of the Code of Federal Regulations.   The Department of Labor (DOL) also provides a helpful fact sheet about the new requirement.

The Department of Labor has recently announced a regulatory initiative that would narrow the “advice exception” to the reporting requirements of section 203 of the Labor-Management Reporting and Disclosure Act (LMRDA).  Section 203 requires employers to annually report via Form LM-10 any agreement or arrangement with a third-party consultant to persuade employees as to the collective bargaining rights, or to obtain certain information about the activities of employees or a labor organization involved in a labor dispute with the employer.  The retained consultant must also file a report concerning the agreement or arrangement (Form LM-20).  However, one of the statutory exceptions in section 203(c) provides that no report need be filed when the consultant gives “advice” to the employer.

In yet another pro labor move under the Obama administration, the National Mediation Board (“NMB”), which oversees labor affairs of airlines and railroads, has issued a final rule that will make it easier for unions to organize airline and railroad employees.  Under the new rule, unions must obtain votes from a majority of all workers who cast ballots in order to be recognized.  This is a significant change from the old rule, which had governed these elections for the past 76 years.  In the past, unions had to obtain votes from a majority of all workers eligible to cast ballots in order to be recognized.  Essentially, the old rule allowed workers who did not cast a ballot to effectively count as a “no” vote.  As a result, in most cases the new rule will decrease the number of votes unions must obtain to win recognition.  Most companies, which are governed by the National Labor Relations Act, follow the same majority requirements as the new rule.

President Obama’s recent recess appointments to the NLRB leave one Republican among three liberal Democrats.  Should the opportunity present itself, the Board’s new composition will likely result in the overturning of two employer-friendly cases, Register Guard (email policy) and Oakwood Healthcare, Inc. (supervisory status). Overturning either of these cases may produce highly unfavorable results for employers.  The Board already has such an opportunity in Register Guard.  The D.C. Circuit recently remanded Register Guard for reconsideration on a limited basis, but the Board may seize the opportunity to reverse its initial holding.

On December 24, 2009, the National Labor Relations Board ("NLRB") issued a revised version of its Case Handling Manual (Part One).  For those inside the NLRB, the Manual provides guidance on various internal policies and procedures for enforcement proceedings.  For those outside the NLRB, the Manual not only states how the agency is likely to deal with issues that arise during such proceedings, but also provides insight into the agency’s enforcement priorities.  Part One (the part recently revised) covers unfair labor practice (“ULP”) charges, but also includes sections that apply to representation elections and compliance proceedings as well.

On December 24, Craig Becker’s nomination to the NLRB ran into a significant obstacle when the Senate returned the nomination to the White House for reconsideration.

Becker, who works for the Service Employees International Union, was nominated by the President earlier this year to fill one of the two vacant Democratic seats on the NLRB.  There has been significant controversy surrounding his nomination due to what critics describe as his extreme, some say radical, pro-union views concerning possible changes to the nation’s labor laws.  The nominations of Democrat Mark Pierce and Republican Robert Hayes were both held over by the Senate for consideration during the next term, indicating that both are likely to be confirmed.  

According to data from BNA PLUS, unions have won more than 73% of the elections in which they participated in the first half of 2009. This is up from 66% for the same time period in 2008. The Teamsters led the way by participating in 164 elections and winning 70% of them, while the SEIU was second, winning 75% of 44 elections.  Although the number of elections conducted by the NLRB thus far in 2009 is down from the number in 2008, the union's win rate in each year of this decade has been over 50% and getting better as the decade progresses. The numbers out today indicate that currently unions are ...

In one of the largest back pay awards in the agency's history, the National Labor Relations Board (NLRB) concluded a settlement with five Michigan beer distributors that required the companies to pay $41 million in back pay to employees and the Teamsters. Findings from an ALJ, supported by the NLRB and the 6th Circuit Court of Appeals, concluded that the five companies colluded to systematically oust the union by separately engaging in bad faith bargaining, unlawfully declaring impasse, and then implementing their respective labor contracts with substantially lower wages and benefits.

The Supreme Court agreed on November 2, 2009 to decide whether decisions of the National Labor Relations Board (NLRB) are valid if they were reached by only two members when other NLRB seats were vacant.  In New Process Steel, LP v. NLRB, the Seventh Circuit concluded that the NLRB’s two-member decision in that case was appropriate and binding.  The Supreme Court is expected to hold oral argument early next year and decide the case in June 2010.