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

Back in June 2011, the Department of Labor’s Office of Labor-Management Standards (OLMS) published proposed revisions to its interpretation of the Labor-Management Report and Disclosure Act of 1959 (LMRDA), which were intended to expand greatly what information employers and their labor relations consultants must report to the Department of Labor.  The proposed revisions to the regulations and related forms would narrow the "advice exception" to the law's disclosure and reporting requirements -- imposing extensive and sweeping new reporting obligations on employers who would utilize the expertise of outside consultants, attorneys or other professionals when addressing labor relations issues.

Due this past week, at least seventy-three submissions were received by the Department of Labor in response to the proposed revisions.  While all are available at Regulations.gov, we highlight a few notable submissions here. 

The American Bar Association (ABA) wrote to express its "serious concerns" that the proposed rules are inconsistent with both the statutory language of the LMRDA and the rules of professional conduct pertaining to lawyer-client confidentiality.  The ABA recommended that the Department preserve its "existing, well-established interpretation of the advice exemption."

Daniel Schwartz of Pullman & Comley notes the significance of the ABA's submission thus:

The ABA’s position here is important because on many labor & employment matters, it abstains because there is typically not a consensus between management-side and employee-side attorneys.  This issue, however, touches all attorneys and is necessary, in the ABA’s words , to defend “the confidential client-lawyer relationship” and would impose an “unjustified and intrusive burden on lawyers and law firms and their clients”.

The rule is still in its proposed stage, but the ABA’s input here could be quite important for another reason as well.  The ABA’s involvement in the “red flag” rules was crucial to getting that rule overturned. Time will tell if the ABA’s involvement here will have a similar impact.

Similarly, the Association of Corporate Counsel (ACC) and its Employment and Labor Law Committee submitted comments urging the withdrawal of the proposed rules.  ACC argues:

The simplest test for determining whether the attorney-client relationship and its associated privileges have been undermined is to ask: will a client with legitimate interests be less likely to retain counsel due to the fear that others will learn of confidential information?  Here, the answer is very straightforward: yes.  And the danger of this outcome cannot be highlighted enough -- without adequate legal counsel, the minefields of contemporary labor law will become significant traps for the unwary.

Finally, the Society for Human Resources Management (SHRM) questioned the DOL's lack of "broad consultation" in its formulation of the proposed regulations, the lack of demonstrated need for these changes, and the substantive foundation of the proposal.  In sum:

SHRM believes the proposed changes are not supported by the statute, are ill conceived, and will lead to many unintended negative consequences. SHRM urges the Division to not adopt the proposed changes. At a minimum, the Division should undertake its own study of the labor relations climate and seek additional stakeholder input before undertaking such sweeping changes.

We agree with most of the arguments set forth in these submissions, consistent with our initial response to the proposal back in June.  We expressed similar reservations in articles in Human Resources Executive Online and Law360:

"It is absolutely an unprecedented intrusion, in terms of its scope and its novelty, into the lawyer-client relationship," Borden said. "The extent to which that might chill the frank, candid and zealous effort with which attorneys provide advice to their clients is troubling."

Employers, consultants and attorneys alike should all follow developments closely, as the issuance of a Final Rule along these lines will have a substantial impact on the manner in which they obtain advice and representation regarding labor relations issues.

• Email This
• Print
• Comments
• Trackbacks
• Share Link

On September 15, 2011, the House of Representatives passed The Protecting Jobs From Government Interference Act (H.R. 2587) which would prohibit the National Labor Relations Board from ordering any employer to close, relocate, or transfer a business. The Democratic majority in the Senate caused many to reasonably ask whether the House action mattered, as the bill has little chance of success in being passed in that chamber. 

But in this political season, nothing can be taken for granted.  On September 20, Senator Lindsay Graham (R-SC) introduced the bill as an amendment  to S. 1599, the Labor-HHS Appropriations bill for FY 2012.  Hitched to that broader legislation, the issue's prospects found themselves dependent first on the action of the Appropriations Committee, and its 16-14 Democratic majority. 

Yesterday, Senator Mark Pryor (D-AR) joined the fourteen Republican Senators on the Committee in voting for the amendment -- but the opposition of the other fifteen Democrats resulted in the measure's failure. 

As noted above, and elsewhere, the Democrats still hold a majority in the Senate -- even with some conservative caucus members willing to depart the party-line.  That reality and President Obama's veto pen pose significant obstacles to enactment of Republican-backed House labor law bills.  But the unique circumstances surrounding the Board -- soon to be unable to act without a quorum of members, absent further Senate action -- during the highly charged political season already upon us may well continue to cause curious and unconventional legislative and administrative maneuvering to accomplish various ends.

Stay tuned...

More information and resources:

• "Manufacturers Urge Senate Committee to Pass Amendment to Rein in NLRB" -- NAM
• "NLRB Amendment Would Have Stopped Runaway Agency from Destroying Jobs" -- Sen. Mike Enzi (R-WY)
• "Senate panel rejects GOP bid to undercut NLRB" -- BusinessWeek
• "Unions Breathe Easier After GOP Assault on NLRB Fails" -- TMPDC
  
• "Update: You Stopped the Attack! Act Now to Stop the Latest Attack on the NLRB" -- AFL-CIO Now blog

• Email This
• Print
• Comments
• Trackbacks
• Share Link

Earlier this month, the National Association of Manufacturers filed suit against the National Labor Relations Board seeking to enjoin the Board's August 30, 2011 Final Rule requiring private-sector employers to post a notice to employees informing them of their statutory rights to pursue union representation.   

Late last week, the National Federation of Independent Businesses filed a similar suit against the Board:

According to NFIB’s lawsuit, the NLRB’s promulgation of the new rule is a gross overreach of its statutory authority under the National Labor Relations Act (NLRA). Moreover, the rule, which takes effect on November 14, 2011, will impact employers with no history of NLRA violations. According to NFIB’s estimates, the rule will impact up to six million private-sector businesses around the country.

The lawsuit asks the court to set aside the rule and declare that the NLRB’s action violates the NLRA.

Finally, this past Monday, the U.S. Chamber of Commerce, joined by the South Carolina Chamber of Commerce, also sued the Board in federal district court in South Carolina.  The Chamber's suit  argues:

• The NLRB lacks the statutory authority for to require employers to post the notice, to create a new unfair labor practice, or to further toll the statute of limitations;
• The NLRB acted arbitrarily and capriciously in drafting the notice—in particular, by refusing to refer to state right to work and other important rights;
• The NLRB violated the Regulatory Flexibility Act by refusing to conduct the required initial and final regulatory flexibility analyses and not stating a sufficient factual basis for failing to do so; and
• The NLRB ‘s new mandate violates the First Amendment to the U.S. Constitution by compelling an employer to espouse ideological views with which it may disagree

• Email This
• Print
• Comments
• Trackbacks
• Share Link

On September 13, 2011, Senate Majority Leader Harry Reid (D-NV) introduced President Obama’s “American Jobs Act of 2011” (S. 1549). The President has been on a barn-storming tour, urging passage of the bill as the nation’s unemployment rate remains north of nine percent. The Democratic National Committee has also launched a website to promote the proposed legislation – and a thorough summary of the bill's 155 pages can be found here.

The bill's introductory provisions include a standard requirement that all contractors and subcontractors on projects funded directly by or assisted in whole or in part by and through the Federal government under the Act must pay Davis-Bacon prevailing wages.  Specifically, Section 5 reads:

SEC. 5. WAGE RATE AND EMPLOYMENT PROTECTION REQUIREMENTS.

(a) Notwithstanding any other provision of law and in a manner consistent with other provisions in this Act, all laborers and mechanics employed by contractors and subcontractors on projects funded directly by or assisted in whole or in part by and through the Federal Government pursuant to this Act shall be paid wages at rates not less than those prevailing on projects of a character similar in the locality as determined by the Secretary of Labor in accordance with subchapter IV of chapter 31 of title 40, United States Code.

(b) With respect to the labor standards specified in this section, the Secretary of Labor shall have the authority and functions set forth in Reorganization Plan Numbered 14 of 1950 (64 Stat. 1267; 5 U.S.C. App.) and section 3145 of title 40, United States Code.

(c) Projects as defined under title 49, United States Code, funded directly by or assisted in whole or in part by and through the Federal Government pursuant to this Act shall be subject to the requirements of section 5333(b) of title 49, United States Code.

• Email This
• Print
• Comments
• Trackbacks
• Share Link

Earlier this year, food service and logistics giant Sodexo USA filed a civil lawsuit against the Service Employees International Union (SEIU) alleging Racketeering Influenced and Corrupt Organizations (RICO) Act violations in connection with the union's corporate campaign against the company.  In the course of that litigation, copies of the SEIU's "Contract Campaign Manual" recently became "officially" available to the general public. 

Monday, Sen. Orrin Hatch (R-UT), sent a letter to current National Labor Relations Board Member Craig Becker about his role in developing the tactics set forth in the Manual, while Becker served as Associate General Counsel to the union.

Specifically, Sen. Hatch asked Member Becker:

• What role, if any, did you play in the drafting or approval of the manual?

• Have you ever advised any client to engage in the questionable tactics outlined in the manual, including tactics specifically designed to personally embarrass or intimidate employers or managers, jeopardize employer relationships with customers and vendors, and purposefully disrupt production in the workplace?

• Have you ever advised any client that it is permissible to break the law in the course of an organizing or contract campaign?

• In your view, are the campaign tactics detailed in the SEIU manual appropriate actions for union members to take in the midst of organizing campaigns or contract negotiations?

Member Becker's nomination was the subject of much controversy and he was not confirmed by the Senate. President Obama subsequently recess appointed him to his post in March 2010, and he will serve until the end of this year. At a time when there has been no shortage to begin with,  this development certainly exposes the Board to even more political pressure.

• Email This
• Print
• Comments
• Trackbacks
• Share Link

The House of Representatives today passed The Protecting Jobs From Government Interference Act (H.R. 2587) which would prohibit the National Labor Relations Board from ordering any employer to close, relocate, or transfer a business. The bill, introduced by Rep. Tim Scott (R-SC), on July 19, 2011 passed the House by a vote of 238-186.

The bill is aimed, in part, at stopping the NLRB from proceeding with its complaint against the Boeing Co. with respect to the opening of its new South Carolina facility.  By its terms, if it passes, the Act would apply to "any complaint for which a final adjudication has not been made by the date of enactment."  Rep. Scott was quoted in the Examiner:

“Today’s vote is important for our entire nation, as well as for my home district in South Carolina, where the NLRB is currently pursuing an agenda which, if successful, would kill thousands of jobs.... By removing the NLRB’s ability to dictate where private industry creates jobs, we are preventing an unelected, presidentially appointed government board from pitting state against state, inserting themselves into the business decisions of private companies, and scaring away investment in our nation.”

The bill passed largely along party lines -- as it did previously in Committee -- so it is little shock that House Democrats were quick to denounce the bill in strenuous terms.  The Education and the Workforce Committee Democrats posted on their website YouTube clips of Reps. George Miller (D-CA) and Robert Andrews (D-NJ) speaking critically of the bill on the House floor.

A related bill (S. 1523), introduced by Sen. Lindsey Graham (R-SC) is pending in the Senate.  

The Boeing case is currently proceeding before an NLRB administrative law judge in Seattle.

• Email This
• Print
• Comments
• Trackbacks
• Share Link

On August 30, 2011,the National Labor Relations Board published a Final Rule requiring private-sector employers subject to the National Labor Relations Act to post a notice to employees informing them of their rights under the Act. By its terms, the Rule was to become effective November 14, 2011.  The National Association of Manufacturers (NAM), however, last Thursday filed suit in the District Court for the District of Columbia, seeking to enjoin the Rule, alleging that it is "in excess of the Board's statutory jurisdiction, authority, limitations and rights."

The introduction to the Complaint tracks the language of Section 706(2)(C) of the Administrative Procedures Act, 5 U.S.C.§§ 701 et seq., which allows a reviewing court to set aside agency actions found to be so.  The Complaint highlights the Final Rule's identification of authority as Section 6 of the NLRA, which provides:

The Board shall have authority from time to time to make, amend, and rescind, in the manner prescribed by the Administrative Procedure Act [by subchapter II of chapter 5 of title 5], such rules and regulations as may be necessary to carry out the provisions of this Act.

NAM's pleadings argue that the Board's Final Rule exceeds this authority in at least four (4) specific ways:

1. In that neither Section 6 nor any other sections of the Act expressly grant the Board the authority to require the posting;

    

2. in that neither Section 6 nor any other sections of the Act grant the Board the authority to assert jurisdiction over, or require anything of, any employer absent the filing of a representation petition or unfair labor practice charge;

    

3. in that the Final Rule purports to create a new unfair labor practice -- while unfair labor practices are otherwise expressly enumerated and described in the statute; and

    

4. in that the Final Rule purports to extend the express six-month statute of limitations for filing charges in a manner inconsistent with the express exceptions set forth in the statute.

NAM's suit requests that the District Court enter judgment against the Board declaring that it exceeded its authority by promulgation of the Final Rule.  Additional relief requested includes preliminary and permanent injunctions against implementation and enforcement of the Rule. 

Employers should follow developments in this case, as absent an injunction, most private sector employers would be required to postthe required Notice in the workplace as of November 14, 2011.  No further action has been scheduled by the Court as of this moment, but we will update the blog accordingly as additional information becomes available.

• Email This
• Print
• Comments
• Trackbacks
• Share Link

The first Administrative Law Judge ruling has come down in a social media case before the National Labor Relations Board.  In a September 2, 2011 decision in Hispanics United of Buffalo, 3-CA-27872, an ALJ has ruled that a Buffalo nonprofit organization unlawfully terminated five employees who had posted comments on Facebook in response to a co-worker's complaint about their job performance.

One of the employer's domestic violence advocates frequently complained about her co-workers not doing enough to help the organization's clients.  One Saturday, off-clock, at home, a co-worker posted a message on her own Facebook page identifying the employee's criticism and seeking her co-workers' opinions about it.  At least five co-workers responded, posting defenses and and commentary on staffing levels and other working conditions.  The postings, replete with profanity, culminated with one employee making reference to a group meeting with the employer's Business Manager -- ostensibly to discuss these issues. 

Days later, following a complaint by the employee who was the subject of the postings, the five employee posters were fired. 

The ALJ's analysis of the case makes express reference to the Board's Parexel International LLC decision, 356 NLRB No. 82 (Jan. 28, 2011), which broadly expanded the scope of protected "concerted activity" earlier this year.  He concluded that the five co-workers were engaged in protected activity, and thus their termination expressly for that activity -- as conceded by the employer -- violated Section 8(a)(1) of the Act:

... I conclude that the Facebook postings satisfy the requirements of that decision. The discriminatees herein were taking a first step towards taking group action to defend themselves against the accusations they could reasonably believe Cruz-Moore was going to make to management. By discharging the discriminatees on October 12, Respondent prevented them by taking any further group action vis-à-vis Cruz-Moore’s criticisms. Moreover, the fact that Respondent lumped the discriminatees together in terminating them, establishes that Respondent viewed the five as a group and that their activity was concerted. Whittaker Corp., supra

In sum, I conclude that the above cases control the disposition of the instant case. Just as the protection of Sections 7 and 8 of the Act does not depend on whether organizing activity was ongoing, it does not depend on whether the employees herein had brought their concerns to management before they were fired, or that there is no express evidence that they intended to take further action, or that they were not attempting to change any of their working conditions.

Employees have a protected right to discuss matters affecting their employment amongst themselves. Explicit or implicit criticism by a co-worker of the manner in which they are performing their jobs is a subject about which employee discussion is protected by Section 7. That is particularly true in this case, where at least some of the discriminatees had an expectation that Lydia Cruz-Moore might take her criticisms to management. By terminating the five discriminatees for discussing Ms. Cruz-Moore's criticisms of HUB employees' work, Respondent violated Section 8(a)(1).

Finally, the ALJ agreed with the General Counsel that the various Facebook postings did not lose the protection of the Act despite the fact that some were profane and/or sarcastic.

It is a brief decision, without many relevant facts in dispute, but which cites numerous earlier Board cases for similar propositions to those upon which this holding rests.  It is another more concrete step in the evolution of Board law on social media issues, however, as practitioners now have an adjudicated decision on these issues -- where previously we were left to speculate as to how they would be treated, based on a variety of complaints, advice memoranda and analogous rulings in other areas.

More resources and commentary:

• Our chapter in “Think Before You Click: Strategies for Managing Social Media in the Workplace,” Thompson Books
• Our May 18, 2011blog post on the issuance of Complaint in Hispanics United
• U.S. Chamber of Commerce Report: “A Survey of Social Media Issues Before the NLRB”
• General Counsel Memorandum OM 11-74 (Aug. 18, 2011), a "Report of the Acting General Counsel Concerning Social Media Cases." -- Hispanics United is the first case discussed.

• Email This
• Print
• Comments
• Trackbacks
• Share Link