Labor Relations Today

Labor Relations Today

National Labor Relations Board Issues Complaints in 13 Cases Against Multiple Franchises and McDonald’s as Joint Employers

Posted in NLRA, NLRB Decisions, Unfair Labor Practices

In a post this morning, we noted that the Board has still not issued its decision in the Browning-Ferris case, wherein it is considering whether to preserve or discard its decades-old standard for determining “joint employment” standard.  Undeterred by the fact that the current state of the law does not support his case, the Board’s General Counsel today announced that he will proceed with the issuance of unfair labor practice complaints against McDonald’s USA and a number of franchises as joint employers.

According to the Board’s press release today, there have been 291 charges filed against McDonald’s franchises since November 2012. The General Counsel is proceeding with prosecution of 13 complaints involving 78 of those charges in Regions 2 (Manhattan), 4 (Philadelphia), 7 (Detroit), 10 (Atlanta), 13 (Chicago), 14 (St. Louis), 15 (New Orleans), 18 (Minneapolis), 20 (San Francisco), 25 (Indianapolis), 28 (Phoenix) and 31 (Los Angeles); and Subregion 17 (Kansas City).

The Board has proposed an interesting approach:

In the interest of conserving public and private resources and to avoid unnecessary delay, the NLRB has scheduled consolidated hearings in three Regional locations in the Northeast, Midwest and West to address violations that require remedial relief as soon as possible.  Absent settlement, the initial litigation will commence on March 30, 2015, and will involve allegations of unlawful actions committed against employees at McDonald’s restaurants in the jurisdiction of six Regional Offices. 

Specifically, the hearing will begin in Region 2 – Manhattan to address allegations in the complaints of Region 2 and Region 4, then will move to Region 13 – Chicago to address allegations in the complaints of Region 13 and Region 25, and will conclude in Region 31 – Los Angeles to address allegations in the complaints of Region 20 and 31.   It is anticipated that hearings involving the allegations in the complaints issued by the other seven Regional offices will be scheduled after the initial litigation before an Administrative Law Judge, if those allegations cannot be resolved through settlement.

In all likelihood, Browning-Ferris will have issued by then.  Still, the fact-sensitive analysis required by these types of cases, directed against a large number of franchises and a large multi-national corporation, is certain to require an extensive amount of time and Board resources in the new year.  In September 15, 2014, the Board issued an amended decision in CNN America, Inc., 361 NLRB No. 47, a case involving an allegation that CNN and a single contractor employing people at two locations were joint employers.  As described by the ALJ in his 2008 decision:

This case was tried in Washington, D.C., and New York, New York on 82 dates between November 7, 2007 and July 21, 2008. There are over 16,000 pages of transcript and over 1300 exhibits, many of them voluminous.

It took another six years of litigation before the Board to arrive at the September 2014 findings. Given the number of distinct parties and complicated circumstances involved in these McDonald’s complaints, it is reasonable to expect a significantly longer process here.

(Im)Patiently Waiting on Browning-Ferris

Posted in NLRA, NLRB, Quick Hits, Unfair Labor Practices, Unions

While several major National Labor Relations Board decisions came out over the last ten days, labor watchers are still waiting on the Browning-Ferris ruling with baited breath. As we have discussed previously, the Browning-Ferris decision could fundamentally alter how the Board determines whether a given entity is a “joint employer” under the National Labor Relations Act.

The existing standard examines whether two or more employers “share or co-determine matters governing the essential terms and conditions of employment” of a group of employees.  If so, those entities will be deemed to be “joint employers,” and both entities can be subject to liability under the Act. But if the General Counsel and the unions get their way, the Board could throw out more than thirty years of precedent (which it has become fond of doing lately) and adopt an unstructured “totality of the circumstances test.” And it is difficult to say what that test would look like in practice.

More troublingly for employers, the Board’s General Counsel has already begun acting as if his proposed joint-employer standard has been implemented. As the reader may recall, General Counsel Griffin announced back in July that his office had authorized complaints against both McDonald’s franchisees and their franchisor, McDonald’s USA.  The complaints were set to issue despite a dearth of evidence that McDonald’s USA had committed any unfair labor practices or had “shared or codetermined matters governing the essential terms and conditions of employment” of the franchisees’ employees.

And as a practical matter, a decision that alters the existing “joint employer” standard could further galvanize the “Fight for Fifteen” movement. If and when fast food employees begin unionizing under the SEIU or another entity underwriting the group’s activities, the union will likely be able to negotiate not only with the franchisee, but also with the franchisor because the franchisor would likely be deemed a “joint employer” of the franchisee’s employees under the amorphous “totality of the circumstances” test advocated by the General Counsel.

So on the week before Christmas, all labor watchers can do is adopt a wait and see attitude. It would not be surprising if this decision drops later this afternoon in order to take advantage of the Friday afternoon news glut.  Stay glued to @LRToday and our twitter feed, where we will have coverage and analysis of the Board’s decision as soon as it drops.

FairPoint, Union Trade Barbs In Press

Posted in Quick Hits, State/Local Issues, Unions

The long-running dispute between FairPoint Communications and the International Brotherhood of Electrical Workers (IBEW) shows no signs of letting up.  Earlier this week, FairPoint CEO Paul Sunu told Vermont Governor Peter Sumlin in a letter that the IBEW has refused to bargain in good faith.  That failure to bargain, Sunu contends, has prolonged a lengthy and unnecessary strike action that began on October 17 of this year.

The letter was made public Wednesday, wherein Sunu further states that FairPoint is seeking a resolution of the labor dispute:

“FairPoint has always been willing to compromise with the unions and from the outset of negotiations, we have bargained in good faith in an effort to reach a fair deal – any assertion to the contrary is simply untrue,” Sunu said in the letter.

More on this story can be found here:

National Labor Relations Board Narrows Arbitral Deferral Standards.

Posted in NLRB Administration, NLRB Decisions, Uncategorized, Unfair Labor Practices

​In yet another holiday “gift”, on December 15, the National Labor Relations Board issued its decision in the closely watched Babcock & Wilcox case, reversing 30+ years of NLRB precedent on whether the NLRB will defer an unfair labor practice charge to a parallel arbitration award.

​The NLRB has a long history of deferring an unfair labor practice charge to the grievance-arbitration process for union represented work forces. In that setting, it is not unusual for an employee or a union to file an unfair labor practice charge with the NLRB claiming that an employee was fired because of his union activities (in violation of Section 8(a)(3) of the NLRA), while simultaneously pursuing a grievance through the parties’ grievance-arbitration process claiming that the employee was discharged without “just cause”, under the parties’ collective bargaining agreement.

​Since the mid-1980′s, when presented with this type of a case, the NLRB would usually defer the unfair labor practice charge to the arbitration process, so long as the employer was willing to waive any procedural defenses it might have (such as the grievance being untimely) so that the grievance would be addressed on the merits by the parties’ arbitrator. For all practical purposes, this meant that if an unfair labor practice charge dealt with factual issues that would be addressed in the arbitration proceeding, the Board would decline to process the unfair labor practice charge, which would be held in abeyance pending the outcome of the arbitration. Once the arbitration award was issued, the NLRB would typically defer to the arbitration award as well, even if the arbitrator did not explicitly address the issue of whether or not the employee was discriminated against because of his/her union activities. Therefore, the arbitrator’s award would, in most cases, conclusively resolve the unfair labor practice charge as well as the pending grievance, even if the arbitrator did not rule on the actual unfair labor practice charge.

During the 1970′s and early 1980′s, the NLRB flip-flopped on what standard it would apply in deciding whether or not it would defer a pending unfair labor practice charge to an employer’s and union’s grievance-arbitration process if the unfair labor practice allegations appeared to be encompassed within pending grievance dealing with the same issue. Finally, in Olin Corp., 268 NLRB 573 (1984), the Board ruled that it would defer an unfair labor practice charge to an arbitration award where the contractual issue was: (1) factually parallel to the unfair labor practice issue; (2) the arbitrator was presented with the facts relevant to resolving that issue; and (3) the arbitration award was not “repugnant” to the NLRA.

​On February 14, 2014, the Board invited amicus briefs in the Babcock & Wilcox case, specifically requesting that amici address the issue of: [s]hould the Board adhere to, modify, or abandon its existing standard for post-arbitral deferral under Spielberg Mfg. Co., 112 NLRB 1080 (1955), and Olin Corp., 268 NLRB 573 (1984)?

​In the Babcock case, the General Counsel argued that the Board should defer to an arbitration award only if the statutory right was either incorporated in the collective-bargaining agreement or presented to the arbitrator by the parties, and if the arbitrator “correctly enunciated the applicable statutory principles and applied them in deciding the issue.”

​In deciding the Babcock case, the Board altered the deferral standard, but did not adopt the General Counsel’s position that the arbitration award must reflect that the arbitrator applied applicable statutory principles. Under its new standard, the Board will defer to an arbitral decision if the party urging deferral shows that: (1) the arbitrator was explicitly authorized to decide the unfair labor practice issue; (2) the arbitrator was presented with and considered the statutory issue, or was prevented from doing so by the party opposing deferral; and (3) Board law reasonably permits the award. According to the Board, this modified framework will “rectify the deficiencies in the current deferral standard in a way that provides greater protection of employees’ statutory rights”.

​Although the Board rejected the standard advocated by the General Counsel, it is notable that under the new standard, the arbitrator must consider the statutory issue (such as, whether or not the employee was terminated because of his/her union activities). According to the Board, the Board will “find that the arbitrator has actually considered the statutory issue when the arbitrator has identified that issue and at least generally explained why he or she finds that the facts presented either do or do not support the unfair labor practice allegation.”

​The Board’s new standard will likely result in more unfair labor practice charges not being deferred and being heard through the NLRB’s unfair labor practice charge procedures. This outcome is likely because, while many arbitrators issue comprehensive decisions, other arbitrators issue short or summary opinions that simply deny or sustain a grievance. The latter type of decision will not result in the Board deferring to the arbitrator’s award, as that type of decision would not provide any evidence that the arbitrator considered the NLRA issue. This change in approach has been something the Board has been studying for quite some time, as the previous General Counsel issued a Memorandum in 2011 addressing the issue, and building on questions raised by his predecessor. From a cynical point of view, the Board’s new standard could be interpreted as somewhat of a “turf grab”, so that the Board (and its bureaucracy) try and hear more unfair labor practice cases. Moreover, the Board’s decision goes against extensive recent judicial precedent favoring arbitration as a more cost-effective, final and binding dispute resolution mechanism – fact noted by Member Miscimarra in his separate opinion:

the changed deferral standards reflect an underlying hostility towards final and binding grievance arbitration and “cause” determinations, contrary to the federal policies favoring arbitration that Congress incorporated into the Federal Arbitration Act (in 1925) and into the Labor Management Relations Act (in 1947). The most important characteristic of “final and binding” arbitration is the notion that adjudicated outcomes will, in fact, be “final” and “binding.” Yet, my colleagues now effectively guarantee that, in most cases involving existing CBAs, arbitration will not be final and binding. The outcome will be more work for the Board, at the expense of speed, predictability, and certainty for the parties, and the virtual elimination of finality given the long litigation treadmill that is associated with Board and court litigation of unfair labor practice claims.

Member Schiffer’s Term Expires Today

Posted in NLRA, NLRB, Quick Hits

As Politico notes, National Labor Relations Board member Nancy Schiffer’s term expires today.  She will be replaced by incoming member Lauren McFerran, who was confirmed in a Senate vote on December 8 of this year.

The reader may recall that member Schiffer’s term began in late summer of 2013 after Senate Democrats prevailed in the so-called “nuclear option” negotiations.  At that time, this blog wrote a short piece discussing what we could expect from Schiffer’s term, which turned out to be largely prescient.  As we have seen over the past year, the Board has continued to enforce class waivers, allowed for union-gerrymandered bargaining units, and re-introduced the “quickie election” procedures.  And just last week, the Board determined that employees had a presumptive right to use their employer’s email system for Section 7 activities.

With McFerran coming in to replace Schiffer, labor watchers can expect more of the same.  McFerran, a Democrat, served as labor counsel to both Senator Harkin and the late Senator Edward “Ted” Kennedy. While McFerran did note during her nomination hearing back in November that she would keep a “very open mind” regarding labor issues, labor watchers expect her to regularly side with the Board’s Democratic block. And with the Board’s pro-labor agenda as aggressive as ever, McFerran’s confirmation could swing the Board’s policies even further to the left.

NFLPA Wary Of New Player Conduct Policy

Posted in Negotiations, NLRB, Quick Hits, Unions

NBCSports is reporting that the National Football League Players Association (NFLPA), the labor union that represents current NFL football players in collective bargaining with the league, may seek to challenge certain portions of the NFL’s new personal conduct policy.  Per the publication’s source, the NFLPA has identified three major issues of concern:

  • The union believes that players should have Fifth Amendment protections during disciplinary hearings;
  • The union disagrees with the policy’s directive to place any layer charged with a violent crime on paid leave; and
  • The union believes that the new policy violates the parties’ collective bargaining agreement.

As of now, the NFLPA is exploring its options and could file a complaint with the National Labor Relations Board.

See below for more on this story:

National Labor Relations Board Issues Final Rule Expediting Union Representation Elections

Posted in Beyond EFCA: Labor's Agenda, Expedited Elections, NLRA, NLRB Administration, NLRB Decisions, Representation Elections, Unions

On the heels of yesterday’s Purple Communications, Inc. decision, the National Labor Relations Board today has taken more significant measures to facilitate union organizing.  The Board today has announced issuance of its final rule overhauling representation election procedures to expedite union representation elections.

The Board rule contains many of the same controversial measures published in the Board’s earlier attempt to overhaul these procedures, initially published in the Federal Register on Thursday, December 22, 2011.  That rule went into effect on April 30, 2012, but was invalidated by the courts just weeks later because it was promulgated without a proper quorum of three Board Members.  The Board subsequently withdrew the rule, but in February of this year, with a full quorum of confirmed Members, it reissued a Notice of Proposed Rulemaking identical to its earlier proposal.

The new final rule, however, includes even more of the Board’s proposals than the 2011 final rule. Accordingly, it appears the Board ignored not only most of the critical comments among the 65,000 filed in 2011, but also all of the arguments from the subsequent litigation and the additional stakeholder comments filed in response to the more recent NPRM.

The final rule:

  • Provides for electronic filing and transmission of election petitions and other documents;
  • Requires the employer to provide the names and information about employees immediately upon the filing of a petition;
  • Requires the employer to declare all legal positions within days of the petition filing, under threat of waiver;
  • Drastically limits preliminary litigation of issues relevant to the election;
  • Eliminates the ability of the parties to seek pre-election review of erroneous Regional Office decisions; and
  • Requires that additional contact information (personal telephone numbers and email addresses) be included in voter lists, to the extent that information is available to the employer.

The rule will be published in the Federal Register on December 15, and will take effect on April 14, 2015 — but there will be significant litigation challenging the rules well in advance of that time.  The implementation of these rules will have a profound impact on the way employers respond to union organizing attempts.  Unions have undoubtedly been waiting for this moment, certain to usher in an increased wave of organizing efforts.  We are in the process of reviewing the lengthy final rule and related resources, and will follow up with more detailed analysis as appropriate.

Additional resources:

 

 

NLRB Grants Employees New Right To Use Employer Email Systems For Organizing Activities

Posted in NLRA, NLRB, Unfair Labor Practices, Unions

As we previewed here earlier today, the National Labor Relations Board has issued the remainder of the Purple Communications decision. The ruling, found at 361 NLRB No. 126 (Dec. 11, 2014), in effect creates a new substantive right of employees to use an employer’s computer networks and email systems to engage in union organizing.

Respondent Purple Communications provides sign-language interpretation services. Since June 2012, Respondent maintained an employee handbook that contained the following policy:

INTERNET, INTRANET, VOICEMAIL AND ELECTRONIC COMMUNICATION POLICY

Computers, laptops, internet access, voicemail, electronic mail (email), Blackberry, cellular telephones and/or other Company equipment is provided and maintained by the [sic] Purple to facilitate Company business. All information and messages stored, sent, and received on these systems are the sole and exclusive property of the Company, regardless of the author or recipient. All such equipment and access should be used for business purposes only.

Prohibited activities

Employees are strictly prohibited from using the computer, internet, voicemail and email systems, and other Company equipment in connection with any of the following activities:

2. Engaging in activities on behalf of organizations or persons with no professional or business affiliation with the Company.

5. Sending uninvited emails of a personal nature.

The Communications Workers of America (CWA) filed petitions to represent Respondent’s employees in the fall of 2012 at seven of Respondent’s facilities. The CWA filed objections to the election results at two of the facilities, and also filed unfair labor practice charges regarding Respondent’s electronic usage policy.

Board ALJ Paul Bogas, relying on the Board’s decision in Register Guard, dismissed the allegations and the CWA and the General Counsel filed exceptions to his ruling. The General Counsel argued that the “broad prohibitions on employees’ personal use of electronic communications . . . substantially interfere with Section 7 activity,” while the CWA argued that the Board “should adopt a presumption that employees may access employer email . . . to communicate about Section 7 matters if their employer generally allows them access to the system.” Respondent and its Amici, by contrast, argued that Register Guard was rightly decided: “employers may impose nondiscriminatory restrictions on employees’ nonbusiness use of equipment and . . . an email system should be treated like other employer equipment.”

Discarding decades of legal precedent, the majority sided with the General Counsel and the CWA and overruled Register Guard. That decision, the majority concluded, “undervalued employees’ core Section 7 right to communicate in the workplace about their terms and conditions of employment, while giving too much weight to employers’ property rights.”

The majority explained its ultimate holding thus:

“[W]e adopt a presumption that employees who have been given access to the employer’s email system in the course of their work are entitled to use the system to engage in statutorily protected discussions about their terms and conditions of employment while on nonworking time, absent a showing by the employer of special circumstances that justify specific restrictions.”

In explaining its decision, the majority noted that “email remains the most pervasive form of communication in the world.” But then the Board made a leap in logic, positing that email has become a “natural gathering place” for employees to engage in conversation, and thus they should be able to use it to discuss Section 7 activities.  Buttressed by its leap in logic – that using the tangible computer equipment comprising email system is no different than simply speaking — the Board cited the Supreme Court’s seminal Republic Aviation decision to explain how the majority crafted its new analytical framework. Republic Aviation explained that a ban on oral solicitation on employees’ nonworking time was presumptively unreasonable, and that an employer implementing such a restriction “must demonstrate that special circumstances made the rule necessary in order to maintain production or discipline.”  Without any further guidance as to what types of circumstances might pass muster, the decision clearly places that burden on the employer.

The majority then tried to explain away all the Board’s contrary precedential decisions relating to employer equipment arising in the decades since Republic Aviation, asserting they were “different in material respects” from the instant matter.  For example, the Board argued that unlike the use of telephones or bulletin boards, “email’s flexibility and capacity make competing demands on its use considerably less of an issue than with earlier forms of communications equipment … [and that] Employee email use will rarely interfere with others’ use of the email system.”

Lastly, the majority concluded that its decision should apply retroactively because applying the decision prospectively “would continue a far-reaching, wrongful denial” of employees’ Section 7 rights. The majority then remanded the case to the ALJ to allow Respondent to present any evidence of special circumstances that would justify any restrictions on employee email communications.

Both members Miscimarra and Johnson issued lengthy dissents. Member Miscimarra’s dissent reasoned that the majority was incorrect on four counts. First, he writes that it is unreasonable to presume that limiting the use of employer email systems to business purposes “constitutes an unreasonable impediment to self-organization” as employees still have available to them numerous means of direct communications with each other.

Second, the majority’s ruling butts up against Electromation, Inc., 309 NLRB 990 (1992). In that case, the Board determined that an employer violated Section 8(a)(2) of the National Labor Relations Act by providing “pencils, paper, telephones, and a calculator” for employees to use in organizing activities. Now the Board is effectively compelling an employer to hand over its email system to its employees for organizing activity, and the tension between the two decisions is left unaddressed by the majority.

Third, now that employees have a statutory right to use the employer email system for organizing activities, it will be very difficult to determine what constitutes effective employer oversight of its email system and what constitutes unlawful “surveillance.” And finally, member Miscimarra’s dissent takes the majority to task for replacing a bright-line rule with a difficult to apply standard.

Member Johnson’s dissent is perhaps more scathing. Referring to the majority’s decision as “radical,” member Johnson writes that the “new standard will undermine the long settled Board and court principle that working time is for work.” Member Johnson also fervently disagrees with the majority’s conclusion that email is the new “water cooler.” A water cooler is clearly a non-work area, whereas “there is no easy-to-determine-and-administer dividing line between the working area and the nonworking area” in email and other virtual spaces. Rather, the two areas are commingled, which under the Board’s new standard effectively forces “water cooler” conversations onto the production floor.

Next, member Johnson explains that the majority is incorrect in holding that the Board’s “equipment cases” were inapposite. Email, member Johnson writes, is the employer’s property. It is a means of communication “that the employer owns and provides to its employees to advance productive business interests.” Thus the employer should be able to limit its usage to business purposes, just like with the bulletin board and the telephone, because “an employer has a basic property right to regulate and restrict employee use of company property.”

Lastly, member Johnson reasons that the majority’s decision is wrong because it is violative of the First Amendment. The employer will “inevitably pay employees during working time to compose” and review hostile speech. And to add insult to injury, the employer is also paying to host the system whereby hostile speech is composed and transmitted. In effect, “the majority’s rule compels employer funding of a huge volume of speech that the employer does not support,” which member Johnson contends is plainly violative of the Supreme Court’s First Amendment jurisprudence.

Employers should review the Purple Communications decision carefully. It may be true that many, if not most, employers who provide employees with email access for business purposes also tolerate some level of personal use.  But for those who have chosen to limit use to business-use only, the Board has today announced a seismic shift in its jurisprudence.  This decision has opened the door for employees, and by extension the unions they support, to use employer email systems – and perhaps additional employer equipment — for union organizing activities. Accordingly, employers should review their current email and computer usage policies to ensure that they comply with the Board’s new standard. Moreover, an employer who believes it has “special circumstances that [would] justify specific restrictions,” should develop its position and  compile as much supportive data as possible while structuring its policies.

National Labor Relations Board Creates Right of Employees to Use Employer E-Mail Networks for Union Organizing

Posted in NLRA, NLRB Decisions

With midterm elections and Senate confirmation of a fifth Board Member behind us, the National Labor Relations Board returned to the portion of the pending Purple Communications case on which it chose to pass just weeks ago.  In a Decision and Order published today, Purple Communications, Inc., 361 NLRB No. 126 (Dec. 11, 2014), the Board has fulfilled its intention to create a new substantive right of employees to use an employer’s computer networks and e-mail systems to engage in union organizing.  In so doing, the Board has cast aside several decades of precedent.

Two separate dissents by Members Miscimarra and Johnson, a combined 43 pages, follow an 18-page three-Member majority decision.  The entire document can be found here.  We are reviewing the decision and will expand upon this analysis in a later post.

Additional resources:

Board ALJ Hits Walmart With ULPs

Posted in NLRA, NLRB, Quick Hits, Unfair Labor Practices, Unions

Yesterday, the National Labor Relations Board released Administrative Law Judge Geoffrey Carter’s decision finding that Walmart managers in California committed several unfair labor practices.  In pertinent part, ALJ Carter ruled that Walmart’s managers had illegally disciplined employees for engaging in a one-day strike.  The managers also violated the National Labor Relations Act by making threats to shut down a store if employees joined the Organization United for Respect at Walmart (OUR Walmart). 

OUR Walmart, an affiliate of the United Food and Commercial Workers (UFCW), filed the Board charges against the company.  As the reader may recall, OUR Walmart has been active in its attempts to compel Walmart to increase employee wages to $15 per hour.  This past Black Friday, Walmart worker across the country staged protests outside of the company’s stores to demand higher pay and better benefits.

Judge Carter also determined that Walmart’s California dress code was unlawful.  The policy was found to be overly broad because it “unduly restricted associates’ right to wear union insignia.” 

More on this story can be found here: