Labor Relations Today : Labor & Employment Lawyers & Attorneys : Contract Administration, Collective Bargaining

NMB agrees to delay implementation of Election Rule:  Two weeks ago, the National Mediation Board (NMB) announced a change in the way votes would be tallied in future union representation elections under the Railway Labor Act.  Last week, an association of airlines filed suit in federal court seeking injunctive relief against the implementation of the Rule.  At a status conference in court this week, the NMB agreed to hold implementation of the Rule at least until June 30, 2010.

Reid Public Safety Employee Amendment to Supplemental Withdrawn:  Tuesday, Senate Majority Leader Harry Reid (D-NV) proposed to attach the Public Safety Employer-Employee Cooperation Act of 2009 to the pending Emergency Appropriations Supplemental.  The Public Safety Employer-Employee Cooperation Act, introduced with bipartisan support earlier in the Congress by Sen. Judd Gregg (R-NH) would ensure the extension of collective-bargaining rights to public safety employees employed by all states and localities.   Senator Reid's move prompted CQ Today to predict that "the amendment would be considered 'non-germane' and would no longer be in order if the Senate votes Thursday in favor of Reid’s motion to limit debate on the bill."  Last night, the Amendment was indeed withdrawn and the Supplemental was passed 67 to 28.  The stand-alone version of the bargaining bill remains pending, however, in both the House and Senate.

NLRB Would Assert Jurisdiction Over New York Racino:   The Board this week issued an Advisory Opinion requested by the New York State Employment Relations Board (NYSERB) in Yonkers Racing Corp. d/b/a Empire City at Yonkers Raceway, 355 NLRB No. 35 (May 24, 2010).  From 1899 until 2008, the employer operated a horse racetrack in Yonkers, New York.  In 2008, like many other racetracks are doing nowadays, the employer opened a casino on its premises.  Two unions filed petitions with NYSERB seeking to represent particular units of employees.  They did so because traditionally the NLRB asserts jurisdiction over casinos which meet the appropriate commerce threshholds, but declines to assert jurisdiction over racetracks -- leaving the issues to state agency resolution.  NYSERB sought the Board's advice on the issue, and the Board held:

We agree with the Employer that, as a result of the changes resulting from the addition of its casino gambling operations, the enterprise is no longer primarily a racetrack, and that the Board’s policy of declining jurisdiction over racetracks no longer applies to it.  In two recent published cases, the Board considered combined casino and racetrack operations with histories similar to that of the Employer’s enterprise. In each case, the Board found that although the enterprise began life as a racetrack and added casino operations later, the revenue and employment generated by the casino so overshadowed those generated by the horseracing operations the enterprise was no longer “essentially a racetrack,” Prairie Meadows Racetrack & Casino, 324 NLRB 550, 551 (1997), and “the racetrack was dependent on the casino, not the other way around.” Delaware Park, 325 NLRB 156, 156 (1997). 

Racing employers accustomed to state agency jurisdiction in addressing labor relations matters should take note of these developments as they embark upon consideration of casino expansion.

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The run-off primary election between Senator Blanche Lincoln (D-AR) and challenger Lt. Gov. Bill Halter (D-AR) is one of the primary elections most closely tracked by EFCA watchers.  Senator Lincoln prominently announced she would not be supporting cloture on the bill back in March 2009, soon after Sen. Arlen Specter (then R-PA) made a similar announcement.  These declarations were seen as the begining of the end for EFCA's prospects in 2009.  Unions and organized labor groups roundly criticized Sen. Lincoln, opening the door for Lt. Gov. Halter's challenge.  Politico now reports that Sen. Lincoln has declined to debate Lt. Gov. Halter until he states a clear position on EFCA: 

“My stand on this legislation is the reason the D.C. unions are in Arkansas spending nearly $10 million attacking me and misrepresenting my record," Lincoln said in a statement. "Arkansans know my record, and they deserve to know where Bill stands. If we are going to debate the issues, we both have to be willing to take a stand on the issues."

 

There were three debates prior to the May 18 primary, in which Lincoln edged Halter but failed to reach the 50 percent required to avoid a June 8 runoff election.  Says Politico:

In each debate, Halter has avoided a direct answer on the Employee Free Choice Act — legislation that would make it easier for workers to form unions — by saying the bill is no longer politically viable.

 

“The Employee Free Choice Act, or card check, as it has been called, is really no longer operative. If you talk to labor leaders or management leaders, that's no longer on the table,” he said during the April 23 KATV debate.

 

"Card check's not going to be brought back on the table. It's really just that simple,” he said one day later at a debate before The Associated Press in Little Rock, later adding that he supports “speedier elections and more rigorous enforcement of free elections.”
 

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Last night, Senate Majority Leader Harry Reid (D-NV) proposed an amendment (S. Amdt. 4174) to an Emergency Supplemental Appropriations bill that would extend collective-bargaining rights to all public safety workers employed by states or localities.  In its findings, the language includes:

    (4) The absence of adequate cooperation between public safety employers and employees has implications for the security of employees and can affect interstate and intrastate commerce. The lack of such labor-management cooperation can detrimentally impact the upgrading of police and fire services of local communities, the health and well-being of public safety officers, and the morale of the fire and police departments. Additionally, these factors could have significant commercial repercussions. Moreover, providing minimal standards for collective bargaining negotiations in the public safety sector can prevent industrial strife between labor and management that interferes with the normal flow of commerce.

    (5) Many States and localities already provide public safety officers with collective bargaining rights comparable to or greater than the rights and responsibilities set forth in this title, and such State and local laws should be respected.

The amendment language is identical to the Public Safety Employer-Employee Cooperation Act of 2009 (S. 1611) introduced in March 2009 by Sen. Judd Gregg (R-NH). This bill had been introduced in successive congressional sessions since the 1990’s, including the 110th Congress, where it had strong bipartisan support before faltering. As reported earlier this year in The Hill:

In 2007, the bill passed the House with more than 300 votes and was in a strong position to clear the Senate. But President George W. Bush issued a veto threat and the Senate bill’s lead Democratic sponsor, the late Sen. Edward Kennedy (D-Mass.), fell ill. The legislation then became overrun with amendments and subsequently fizzled on the Senate floor.

On March 10, 2010, the House Education and Labor Committee held hearings on the bill, transcripts of which are available here.  Seeing as there were at least five GOP co-sponsors to Sen. Gregg’s similar bill, it is highly likely that this amendment will pass and become part of the Supplemental. Deliberation on the Amendment and Supplemental is scheduled to resume today.

More coverage:

• "Unclear if war supplemental will steer clear of add-ons" -- GovExec.com
• "Hearing Held on Bargaining Bill" -- IAFF website 
• "Collective Bargain Vote Today?" -- Greensboro (NC) News-Record

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On Monday, May 17, 2010, the Air Transport Association of America, Inc. filed suit in the District Court for the District of Columbia, seeking declaratory and injunctive relief to prohibit the National Mediation Board from implementing its new Final Rule regarding the union election process. 

The suit claims that the NMB's rule:

violates the Railway Labor Act ("RLA"), 45 U.S.C. §§151 et seq., and is an unjustified departure from 75 years of Board practice in violation of the Administrative Procedure Act ("the APA"), 5 U.S.C. §§551 et seq.

The Associated Press reports:

Robert Siegel, an attorney for the airline association, said the NMB had rejected changing the rule on four previous occasions over the last three decades. The Supreme Court has twice upheld the right of the board to keep the old rule.

The lawsuit argues that nothing has changed since those previous decisions, other than President Barack Obama appointing Linda Puchala — the former head of a flight attendant union — to a seat on the three-member board, shifting the balance of power.

More commentary:

• "Airlines sue to block union vote rule change" -- Reuters
• "ATA files lawsuit against National Mediation Board over voting rule" -- ATWOnline
• "Airlines Split on Labor Rule Change" -- TheStreet

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Last month, the Federal Acquisition Regulation council (FAR) published a proposed rule implementing Executive Order 13494, "Economy in Government Contracting" in the Federal Register.  The Order was one of three Executive Orders issued by President Obama on January 30, 2009 regarding labor relations.  EO 13494 declared the costs of any activities undertaken by federal contractors to persuade employees to choose or decline union representation to be ineligible for government reimbursement.

The Regulatory Secretariat is now accepting comment on the proposed amendment of 48 CFR Part 31 to include the following:

31.205–21 Labor relations costs.

(a) Costs incurred in maintaining satisfactory relations between the contractor and its employees (other than those made unallowable in paragraph (b) of this section), including costs of shop stewards, labor management committees, employee publications, and other related activities, are allowable.

(b) As required by Executive Order 13494, Economy in Government Contracting, costs of any activities undertaken to persuade employees, of any entity, to exercise or not to exercise, or concerning the manner of exercising, the right to organize and bargain collectively through representatives of the employees’ own choosing are unallowable. Examples of unallowable costs in paragraph (b) of this section include, but are not limited to, the costs of—

(1) Preparing and distributing materials;

(2) Hiring or consulting legal counsel or consultants;

(3) Meetings (including paying the salaries of the attendees at meetings held for this purpose); and

(4) Planning or conducting activities by managers, supervisors, or union representatives during work hours. 

Comments are due on or before June 14, 2010.

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As we've reported at our sister blog, EFCA Report, the early results are in from yesterday's primary contests, and this morning's talking points focus on the general anti-incumbent trend.  But others, including NAM's ShopFloor.org, have also noted it was a "Tough Night for the Card Check Crowd."

Suffering a major primary defeat was a figure central to the long-winding evolution of the Employee Free Choice Act --  five-term Democrat-turned-Republican-turned-Democrat Senator Arlen Specter of Pennsylvania. 

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The early results are in from yesterday's primary contests, and this morning's talking points focus on the general anti-incumbent trend.  But others, including NAM's ShopFloor.org, have also noted it was a "Tough Night for the Card Check Crowd."

Chief among the figures central to the long-winding evolution of the Employee Free Choice Act is five-term Democrat-turned-Republican-turned-Democrat Senator Arlen Specter of Pennsylvania.  An original co-sponsor of the 2005 Act, Specter was long viewed as a crucial "bi-partisan" vote for EFCA in the whip count.  Sen. Specter consistently expressed a strong desire to see labor law reform addressed in this Congress. Yet he was also highly critical of EFCA (and the tenor of the related debate) in both a 2007 floor speech on the cloture motion and in a Policy Essay published in the Harvard Policy on Legislation.   Then, on March 24, 2009, Senator Specter made a pivotal floor speech, wherein he declared he would vote against cloture on EFCA as drafted.  In his speech, and in an attached Appendix to his remarks, he expanded further on the various alternative avenues of labor law reform he might support.

Senator Specter's statement -- and guaranteed protection of the filibuster -- likely freed Democrats critical of the bill to state their opposition as well.  Just two weeks later, Senator Blanche Lincoln (D-AR) announced that she would not support EFCA as introduced.  Additional Democrat Senators soon too expressed reservations about the bill.

Then, in yet another interesting turn, in  late April, 2009, Sen. Specter announced that he was switching parties, and would run for re-election in 2010 as a Democrat.  At the time, he declared: "...my position on Employees [sic] Free Choice (Card Check) will not change."  But, as NAM notes today, just five months later, he told the Pennsylvania State AFL-CIO Convention:

We have pounded out an Employees Choice bill which will meet labor’s objectives. I believe before the year is out, and I will join my colleague Senator Casey in predicting, that there will be passage of an Employees Free Choice Act which will be totally satisfactory to labor.

Last night, Senator Specter suffered a substantial defeat in the Pennsylvania Democratic Party primary, losing to challenger Rep. Joseph Sestak (D-PA).  Is this really a rejection of EFCA by the voters as NAM suggests?  Maybe, but it also may be too early to tell as there were clearly a lot of other factors at work here.  It may be noteworthy that his challenger, the Democratic nominee, Rep. Sestak co-sponsored EFCA in 2007 and 2009, and voted for the measure in 2007 when it passed the House.  Interestingly, early in this Congress, he also intorduced an alternative labor law reform measure -- the National Labor Relations Modernization Act (H.R. 1355).  This law would:

1. provide for mandatory arbitration following a 120-day mediation period, if after an initial 120 days of bargaining failed to result in an agreement;
2. increase penalties against employers (similarly to EFCA's proposed changes); and
3. require an employer to provide equal access to the employees to union organizers once an election is ordered.

No further action was taken on Rep. Sestak's bill.

The other key figure mentioned above, Sen. Lincoln, appears to have narrowly finished ahead of her union-backed primary challenger Lt. Gov. Bill Halter (D-AR), but will need to compete in a run-off with Halter come June.  Lincoln has consistently opposed EFCA, drawing the ire of labor groups and consequently, the primary challenge.  EFCA and organized labor were consistently more overt issues in this race, and to NAM's point, Lincoln's victory last night despite the anti-incumbent wave may be a better indicator of anti-EFCA sentiment than the Pennsyvlania result.

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The National Labor Relations Board today invited interested parties to submit amicus briefs in two groups of cases. Those cases involve whether an employer should be required to post remedial notices electronically and whether compound interest should be applied to monetary awards ordered by the Board. The request indicates that the Board is considering changing existing law in these areas.

 The text of the notice is as follows: 

The National Labor Relations Board is inviting all interested parties to file briefs in two sets of pending cases that involve significant issues for employees, employers and unions. 

 One set of cases raises the question of whether Board-ordered remedial notices should be posted electronically, such as via a company-wide email system, and if so, what legal standard should apply. Such notices, which announce steps taken to remedy violations, are now typically posted on workplace bulletin boards. A change in policy would require the Board to reconsider its decision in Nordstrom, Inc., 347 NLRB 294 (2006).

 The cases are Arkema, Inc., 16-CA-26371; Stevens Creek Chrysler Jeep Dodge, Inc., 20-CA-33367, and Custom Floors, Inc., 28-CA-21226.

 Another set of cases asks whether the Board should routinely order compound interest on back pay and other monetary awards in unfair labor practice cases, and if so, what the standard period should be for compounding (daily, quarterly, annually?).

 The cases are Bashas’ Food City, 28-CA-21435; Atlantic Scaffolding Company, 16-CA-26108; and Kentucky River Medical Center, 9-CA-42249.

 Briefs in both issues must be filed with the Board in Washington, D.C. on or before June 11, 2010, and should be no longer than 25 pages. For further information on filing, please contact the office of NLRB Executive Secretary Lester A. Heltzer at (202) 273-1067.

 The National Labor Relations Board is an independent federal agency vested with the power to safeguard employees' rights to organize and to determine whether to have unions as their bargaining representative. The agency also acts to prevent and remedy unfair labor practices committed by private sector employers and unions.

In a recent post, we noted that the Board may be considering changing its rules from ordering simple interest on monetary awards to requiring compound interest. In San Juan Teachers Assn., 355 NLRB No. 28 (Apr. 30, 2010), the Board stated in a footnote: “we are not prepared at this time to deviate from our current practice of assessing simple interest.” (emphasis added). 

With regard to electronic notice posting, Chairman Liebman had asserted in Nordstrom, Inc., 347 NLRB 294 (2006) that electronic posting should be required “when an employer customarily communicates to employees via an intranet.” The Bush-appointed majority in the Nordstrom case had rejected Ms. Liebman’s approach.

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Wikipedia defines a “flash mob” as “a large group of people who assemble suddenly in a public place, perform an unusual and pointless act for a brief time, then quickly disperse.” These events, typically captured on video for sites such as YouTube, have recently taken place as performance art, commercial publicity stunts, or just college hijinx. Yesterday, the flash mob made an appearance as a labor protest. 

Negotiations between unions and a number of San Francisco hotels have been at a standstill for months. Picket lines and boycotts have been in place for some time. On Saturday, the gay rights group Pride At Work employed a new tactic -- a flash mob -- at the Westin St. Francis and Grand Hyatt hotels. Here is the video:

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Published in yesterday's Federal Register, the National Mediation Board has announced that it has adopted a final rule modifying the way votes are tallied in representation elections under the RLA:

As part of its ongoing efforts to further the statutory goals of the Railway Labor Act, the National Mediation Board (NMB or Board) is amending its Railway Labor Act rules to provide that, in representation disputes, a majority of valid ballots cast will determine the craft or class representative. This change to its election procedures will provide a more reliable measure/indicator of employee sentiment in representation disputes and provide employees with clear choices in representation matters.

Federal Register Volume 75, Number 90 (Tuesday, May 11, 2010), pages 26062-26089.

Previously, in elections under the Railway Labor Act, a union would only be certified as a bargaining representative of a group of employees if a majority of all eligible voters cast ballots in favor of unionization.  The new standard is essentially the standard applied by the National Labor Relations Board in elections under the NLRA.

More on this issue:

• "Delta, Airlines Face Challenge Slowing Union Drives" -- BusinessWeek
• "NMB Delivers Historic Election Rule Change" -- IAMAW website
• "Airlines Mount Legal Challenge to New Rule on Union Organizing" -- CBS Marketwatch
• "NMB to Change Union Election Rules" -- Aviation Week
• "Federal Rule Change Makes Unionization Easy" -- Airline Pilots Forum
• "NMB Issues New Majority-Vote Rule" -- Workplace Prof Blog
• "Labor Board Allows Will of the Few to Dictate Terms For the Many" -- ShopFloor.org

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The National Labor Relations Board knows social networking. The NLRB is on Facebook. It is also on Twitter, and it has its own YouTube channel. As part of what it calls a “modern outreach and education strategy aligned with the contemporary workforce and workplace,” the agency hired Anthony Wagner in October 2009 as a New Media Specialist in the NLRB Office of Public Affairs.  And the NLRB has published a Social Networking Comment Policy. 

Perhaps of more significance to employers is the fact that the NLRB Division of Advice has already weighed in on at least one aspect of this new phenomenon. While Memoranda from the Division of Advice do not constitute formal adjudication or binding precedent, they are often quite instructive. 

In response to an inquiry from the Regional Director from Minneapolis (Region 18), the Division of Advice considered whether a social media policy promulgated by Sears Holdings violated the National Labor Relations Act.

The International Brotherhood of Electrical Workers (IBEW) filed an unfair labor practice charge with Region 18 claiming that the Sears Holdings Social Media Policy violated Section 8(a)(1) of the NLRA because it might chill employee participation in union organizing activities. As often happens in cases that raise new or novel legal questions, the Regional Director submitted the issue to the agency’s Division of Advice for direction on whether to issue a Complaint. 

The policy at issue stated:

[I]n order to ensure that the Company and its associates adhere to their ethical and legal obligations, associates are required to comply with the Company’s Social Media Policy. The intent of this Policy is not to restrict the flow of useful and appropriate information, but to minimize the risk to the Company and its associates.

* * *

Prohibited Subjects

In order to maintain the Company’s reputation and legal standing, the following subjects may not be discussed by associates in any form of social media:

·        Company confidential or proprietary information

·        Confidential or proprietary information of clients, partners, vendors, and suppliers

·        Embargoed information such as launch dates, release dates, and pending reorganizations

·        Company intellectual property such as drawings, designs, software, ideas and innovation

·         Disparagement of company’s or competitors’ products, services, executive leadership, employees, strategy, and business prospects

·        Explicit sexual references

·        Reference to illegal drugs

·        Obscenity or profanity

·         Disparagement of any race, religion, gender, sexual orientation, disability or national origin

The Division of Advice analyzed the issue under the framework set forth by the Bush Board in Lutheran Heritage Village – Livonia, 343 NLRB 646 (2004), a case that dealt with a rule prohibiting certain types of interactions in the workplace. The union in that case had argued that workplace rules prohibiting “abusive and profane language,” “harassment,” and “verbal, mental and physical abuse” unlawfully chilled union activity. The Board, announced a three-part test to determine the validity of rules that do not explicitly forbid union activity protected by Section 7 of the NLRA. Under that test, a rule is only unlawful if: “(1) employees would reasonably construe the language to prohibit Section 7 activity; (2) the rule was promulgated in response to union activity; or (3) the rule has been applied to restrict the exercise of Section 7 rights.” The Board in Lutheran Heritage Village found that the test was not met, so the rules prohibiting “abusive and profane language,” “harassment,” and “verbal, mental and physical abuse” were lawful.

Using that test, the Division of Advice opined that the Sears Holdings Social Media Policy did not violate the Act. It noted:

While the ban on “[d]isparagement of company’s . . . executive leadership, employees, [or] strategy . . . .” could chill the exercise of Section 7 rights if read in isolation, the Policy as a whole provides sufficient context to preclude a reasonable employee from construing the rule as a limit on Section 7 conduct. The Policy covers a list of proscribed activities, the vast majority of which are clearly not protected by Section 7.

The Division of Advice therefore concluded that the Regional Director should not issue a Complaint. 

Can employers rely on the December 2009 Advice Memorandum in drafting or maintaining social media policies? Because no Complaint was issued, the question did not reach the Board for a adjudication. But issues regarding social media policies will almost certainly reach the Board at some point in the near future. The analysis by the Division of Advice in the Sears Holdings case certainly seemed sound under existing legal principles. However, under the Obama Board, the application of the Lutheran Heritage Village test (if not the test itself) may well change.

Then-Member Wilma Liebman (appointed Chairman by President Obama) and former Member Dennis Walsh strongly dissented in the Lutheran Heritage Village case. The dissenters noted that they were “struck by the ambiguity” of the rules and that words like “abusive” and “harassment” were “highly subjective.” In their view:

Without a defining context, or limiting language, the rules at issue here could subject to discipline—and thus inhibit—an angry conversation with a supervisor expressing dissatisfaction over an evaluation, a heated discussion between employees over the benefits of unionization, or a loud protest by employees over safety conditions. But expressions of displeasure, and even anger, are protected means of Section 7 communication.

The dissenting opinion went on to discuss “workplace realities” and suggested that “in the course of protected activity, tempers often flare, emotions run high, and employees sometimes do use language that is abusive but not so egregious as to cost them the protection of the Act.” Accordingly, Members Liebman and Walsh would have found the Lutheran Heritage Village rules to be unlawful. 

Of course, the Obama Board may choose to acknowledge that communications in the online world of social media are different than face-to-face interactions in the workplace. Or it may not. But in either case it is prudent to study the Lutheran Heritage Village dissent when drafting or reviewing an employer’s social media policy.

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Our friends at Workplace Prof Blog note that the UAW appears to be readying a test case for the Obama Labor Board. The issue is whether teaching assistants at a private university are “employees” within the meaning of the National Labor Relations Act and therefore have the right to form a union and engage in collective bargaining. The New York Times reports that the union has presented New York University with a petition requesting recognition on behalf of approximately 1,600 graduate assistants.

NLRA coverage of graduate assistants has been one of the see-saw issues for the Board over the last decade. From the early 1970’s to October of 2000, the Board determined that graduate assistants were not “employees” within the meaning of the Act. In New York University, 332 NLRB 1205 (2000), the Board, with a majority of members appointed by President Clinton,  reversed course and extended jurisdiction. The union’s victory was short-lived, however. The Bush Board returned to the earlier interpretation in Brown University, 342 NLRB 483 (2004).

The Times gives the rest of the story: “After the labor board’s 2004 ruling took away their right to unionize and bargain for a contract, the assistants were unable to persuade N.Y.U. to sign a new contract.”

And so the union is back, obviously hoping the pendulum will once again swing. Its hopes are no doubt raised by the dissenting opinion in Brown University, in which then-Member Wilma Liebman (now the Board’s Chair) wrote that treating graduate assistants as outside the Act’s coverage is “woefully out of touch with contemporary academic reality.”

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In our Weekend Round-Up this past weekend, we noted that the House Education and Labor Committee had held a hearing on April 30, 2010 in Berkeley, California for the expressed purpose of:

exploring the challenges in first contract labor negotiations by examining the difficulty of reaching a first contract agreement in negotiations between the University of California and its post-doctoral scholars’ union.

The prepared testimony of the witnesses was previously posted online.  Earlier today, the Committee made available an mp3 file of the hearing. 

While the Employee Free Choice Act itself was not an overt focus of the hearing -- NAM's ShopFloor.org blog pointed out "negotiations concerning state employees are governed by state labor laws, not the National Labor Relations Act" --  it cannot be lost on any that "Facilitating Initial Collective Bargaining Agreements" has long been one of the express goals of that proposed legislation.  We might reasonably expect some of the testimony from this hearing to be cited if and when the Congress takes up amending the NLRA again in the future in whatever form.

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In general, employers increasingly are classifying primarily low-wage workers as independent contractors instead of employees in the construction, home care and health care, professional and technical, and broadcast industries, Lurye said. By doing so, employers can issue these workers 1099 forms instead of W-2 forms to report their income, he said.

 

“So what's the big deal?” Lurye asked. “The big deal is this — by doing that, they immediately gain a 30 percent advantage over an employer who complies with the law.”

 

That percentage is calculated from the savings the employer obtains from not withholding federal and state income taxes, FICA, FUTA, state workers' compensation, and state unemployment insurance premiums from employee pay, he said.

 

Lurye said items not withheld by the employer “become the individual's responsibility when he or she has to file their federal and/or state income tax returns.”

 

Additionally, workers themselves are adversely impacted by misclassification because they do not qualify for fringe benefits they would normally be entitled to as employees, he added. For example, for workers classified as independent contractors, no contributions are made on the worker's behalf to any employer-based pension, health, or welfare plan, he said. Independent contractors also are not be entitled to unemployment or workers' compensation benefits, Lurye added.

• require additional recordkeeping regarding the hours, remuneration and work performed by all workers;
• require that all workers be provided with notice of their classification status and related rights;
• create a rebuttable presumption of "employee" status whenever the foregoing requirements are not met;
• authorize liquidated damages in the amount of twice unpaid compensation (in effect, treble damages); and
• authorize civil penalties in the amount of $1,100 to $5,000 per violation, depending on willfulness or repetition.

As noted by BNA, Mr. Lurye also higlighted the pendency of the Taxpayer Responsibility, Accountability, and Consistency Act of 2009 (H.R. 3408, S. 2882) which would amend a 1978 safe harbor provision in Section 530 of the Internal Revenue Code that protects employers that misclassify workers. 

This issue is gaining political momentum on both the federal and state levels.  Mr. Lurye's remarks re-emphasize the fact that labor unions are also focusing on the issue.  Employers who rely upon independent contractors or other forms of contingent workforces would be prudent to take the time now to audit those relationships to minimize exposure to misclassification claims.

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Late last week the NLRB decided two additional cases.  In Scheid Electric, 355 NLRB No. 27 (Apr. 29, 2010), the Board found that the employer unlawfully withdrew recognition of the union representative, unilaterally changed terms and conditions of employment and interrogated and constructively discharged a union steward.

The second case contains a far more interesting footnote.  In San Juan Teachers Assn., 355 NLRB No. 28 (Apr. 30, 2010), without much discussion the Board affirmed the Administrative Law Judge’s finding that the employer violated Sections 8(a)(1) and (5) of the National Labor Relations Act by unilaterally reducing the hours of two unit employees.  Regarding the remedy, the Board states in footnote 1:

In his exceptions and supporting brief, the General Counsel seeks compound interest computed on a quarterly basis for any backpay or other monetary award. Having duly considered the matter, we are not prepared at this time to deviate from our current practice of assessing simple interest. See, e.g., Cardi Corp., 353 NLRB No. 97, slip op. at 1 fn. 2 (2009); Rogers Corp., 344 NLRB 504, 504 (2005).

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Mr. Spencer's piece includes additional items regarding Department of Labor, OSHA, and Wage & Hour administration, classification of independent contractors and pending DOL regulatory actions.  You can read the entire piece here.

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In The Hill, Kevin Bogardus reports that AFL-CIO President Richard Trumka has repeated his recent assertion that proponents will secure a vote on EFCA this year, even if by tacking it on to unrelated legislation:

One victory that has eluded the AFL-CIO so far is seeing the Employee Free Choice Act signed into law. Unions have struggled to find the 60 votes in the Senate to move the standalone bill, and discussions have moved to attaching it to another piece of legislation.

“Anything we can get it attached to. There are multitudes of things we can get it attached to, and we will. We will get it done and it will be a good thing for the country,” Trumka said. “Quite frankly, I don’t know when we ever had 60 votes.”

The union leader was bullish on its chances of passage, saying there will be a vote on the bill this year and it will pass. 

ShopFloor.org reviews the prepared testimony presented at the House Education & Labor Committee's April 30 hearing, excerpting portions of one management attorney's submission:

Judging from the prepared testimony alone, the Employee Free Choice Act was not a dominant topic at a hearing Friday in Berkeley by the House Committee on Education and Labor, “Understanding Problems in First Contract Negotiations: Post-Doctoral Scholar Bargaining at the University of California.” That’s understandable, since negotiations concerning state employees are governed by state labor laws, not the National Labor Relations Act.

It will be interesting to see, once the transcript is available, whether EFCA was discussed much expressly, and to what extent proponents of the bill might use this hearing's testimony as support for their claims about first contract negotiations.  [More at our sister blog, LaborRelationsToday]

Finally, The Atlantic reports that former President Bill Clinton has recorded campaign ads for incumbent Sen. Blanche Lincoln (D-AR).  Senator Lincoln, of course, has been a notable Democrat opponent of EFCA, and labor unions have staunchly supported her primary challenger Lt. Gov. Bill Halter (D-AR).  This race is one that EFCA observers will continue to keep a close eye on.

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NLRB Decision:  Another day, another new Board decision in a 10(k) jurisdictional dispute.  In Laborers International Union of North America, Local 1184 (Highlight Electric, Inc.), 355 NLRB No. 29 (Apr. 29, 2010), Chairwoman Liebman, and Members Schaumber and Pearce, issued a Determination awarding LIUNA work claimed by an IBEW local in Riverside, California.  This is the fourth decision issued by the new Board, all by this particular three-member panel.

NLRB Election Report: Last week, the Board also posted a link to its Six Month Election Report for October 2009 to March 2010 with Cases Closed March 2010.  During the covered time period, labor unions won 63.1% of all representation elections -- 454 of 719 elections held.

First Contract Hearing:  On Friday, April 30, the House Education and Labor Committee held a hearing at Berkeley City College Auditorium entitled "Understanding Problems in First Contract Negotiations: Post-Doctoral Scholar Bargaining at the University of California."   The House Education & Labor website described the hearing as follows:

The U.S. House Education and Labor Committee will hold a field hearing in Berkeley, Calif. exploring the challenges in first contract labor negotiations by examining the difficulty of reaching a first contract agreement in negotiations between the University of California and its post-doctoral scholars’ union.

In November 2008, after three years of organizing, the California Public Employment Relations Board certified the post-doctorial scholars union at the University of California. Despite this, the University of California system and the post-doctoral scholars, represented by the UAW, have been unable to reach a first contract.

Because the hearing was held offsite, there was no webcast or video.  The prepared testimony of each witness is available online, and we look forward to reviewing and posting the transcript if and when it becomes available.  [CORRECTION: Thanks to House Ed & Labor Specialist Mike Kruger for picking up our typo.  The hearing was held by the House Education & Labor Committee -- "HELP" is, of course, the similar Senate committee.]

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