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

In advance of today's 2:30 p.m. meeting of the National Labor Relations Board to vote on rule changes to expedite union representation elections, we revisited the redlined Rules previously issued by the Board.  Following the release of today's proposed Resolution by the Chairman, we have highlighted in yellow the portions of these changes which the Board will consider today.  (The blue and green annotations are the initial changes to the R&R proposed by the Board's June 2011 NPRM.)

But while the Board addresses its Resolution today, Congress too will be looking at this issue.  The House plans a floor vote this afternoon on John Kline's (R-MN) "Workforce Democracy and Fairness Act" (H.R. 3094).  The bill would guarantee that no representation election is held within 35 days after the filing of a petition, provide for a two-week waiting period before a hearing could be held, and ensure certain preliminary appeal rights.

As noted yesterday, it will be an interesting day at the Board.  We will provide a recap of the day's developments later this evening.

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National Labor Relations Board Chairman Mark Gaston Pearce today released the text of the Resolution to be considered at tomorrow's vote by the Board. The Board will vote on whether to promulgate a select few portions of the rules proposed back in June to expedite union representation elections.

When the Board first announced tomorrow's vote last week, we suspected that the unique political dynamic fostered by the Board's current composition might keep the Board from approaching the more controversial elements of its extensive proposed rule. Subsequently, dramatic revelations about the recent inner workings of the Board -- including a reported threat by lone Republican Member Brian Hayes to resign, effectively precluding official Board action -- suggested that perhaps the Board majority was contemplating a more aggressive approach after all.

In the end, the Resolution released today leaves out a great deal of the changes proposed in June -- including some of the more modest elements we suspected might be passed tomorrow, like electronic filing. Still, portions of this Resolution remain disconcerting.

The Resolution's provisions, by design, would reduce the number of pre-election hearings and eliminate entirely the parties' ability to obtain Board review of Regional Director determinations in advance of elections. While this may reduce delay in a few extreme cases, it may more universally deny the parties the certainty of their legal rights and responsibilities in connection with the election. One troubling possible example that comes immediately to mind is an employer not knowing whether an individual in the proposed unit is legally a "supervisor" under the NLRA until after the election. Anything that employer says to that individual during the pre-election period might generate employer liability if the individual is ultimately declared non-supervisory. On the other hand, anything that individual says to employees might generate employer liability if the individual is ultimately found to be a supervisor. The chilling effect on an employer's rights to communicate with and direct its workforce during the pre-election period is obvious.

Moreover, some of the language toward the end of the Resolution is extremely vague and suggests additional specific changes may ultimately be passed -- either as part of this Resolution or further proceedings -- without spelling them out here.

The vote will follow a Board meeting -- open to public observation (including live streaming at www.nlrb.gov), but not participation -- convening tomorrow at 2:30 p.m. EST.  Given the 2-1 make-up of the Board, it is hard to see how this Resolution would not pass if advanced to a formal "up or down" vote. In light of the flurry of letters and exchanges revealed last week, we suspect people will have their eyes on Member Hayes tomorrow morning in the hours leading up to the meeting. 

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When we reported yesterday that the National Labor Relations Board announced it had scheduled a November 30th vote regarding "a small number" of the changes to its election procedures that the Board proposed back in June, we speculated that current Board dynamics might prevent the Board from adopting a wide range of the controversial measures included in the proposed rule.  Not so fast, it would seem...

In a letter sent yesterday by lone Republican Board Member Brian Hayes to Chairman John Kline (R-MN) of the House Committee on Education and the Workforce, Hayes expressed his serious concerns and more disconcerting circumstances than might have been anticipated:

My colleagues are committed to issuing a final R Case Rule before Member Becker’s recess appointment expires at the end of the current Congressional session.  …  I was further advised that in the event I did not agree with the final R Case Rule, it would, nonetheless, be approved and published based on their two-member vote.  Moreover, if, as will necessarily be the case, I am not afforded the requisite opportunity to review and draft a dissent to the rule, I was advised that I would be limited to doing so after publication of the rule.  … [T]hese actions would contravene long-standing Board tradition and the Board’s own operating rules.   These rules and traditions have been established to protect the legitimacy of the Board.  They cannot, in my view, simply be case aside in pursuit of a singular policy agenda without doing irreparable harm to the Board’s legitimacy.

This reported approach resembles that taken by the National Mediation Board, when in early 2010, following the appointment of a former union president to the Board, the agency excluded dissenting voices from the process of revising a decades-old election rule.  That change too was designed to facilitate private sector union organizing.  Member Hayes adds the troubling suggestion that his colleagues at the NLRB might not be simply considering this approach for the passage of this Proposed Rule, but for a variety of other pending Board matters as well:

…since Member Becker’s recess appointment will expire in less than 90 days, it is quite clear that the two Board members nevertheless intend to breach the Board’s internal operating rule and, for the first time in the history of this agency, not allow the requisite time for preparing or circulating a dissent.  Indeed, as noted above, I have been specifically advised of this fact both with respect to publication or a final rule and with respect to a number of significant cases currently pending before the Board.

Finally, his reference to  the "Workforce Democracy and Fairness Act" (H.R. 3094) in his letter's conclusion, suggests that the two-Member bloc may intend to pass some of the more radical changes included in the Proposed Rule after all:

...I note that my colleagues’ rush to final rulemaking judgment is taken in the face of active consideration of H.R. 3094, provisions of which are in direct conflict with the Board’s proposed Rule.  Although I make no comment concerning the merits of this legislative proposal, I believe its pendency provides yet another reason why my two colleagues should suspend their rulemaking efforts.

Circulation of this letter is certain to revive some of the calls for Member Hayes to step down in advance of the November 30th vote in order to deny the Board a quorum to act.  The legal reasoning laid out by Member Hayes in opposition to the Board's current course might suggest he thinks such drastic measures are unnecessary to prevent promulgation of this rule.  But this should make for an interesting next ten days at the NLRB.

More commentary and resources:

• "Labor Board May Speed Union Votes" -- New York Times
• "NLRB Expedites Action on Ambush Elections" -- House Committee on Education and the Workforce
• "NLRB Vote on Portions of Proposed Election Rule Imminent" -- Littler's Labor Relations Counsel blog
• "House Advances Bill Overturning NLRB Union Rule" -- The Hill's Floor Action blog

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The National Labor Relations Board announced today that it has scheduled a vote on whether to adopt "a small number" of the changes to its election procedures that the Board proposed back in June.  According to the Board, "[t]he proposed amendments are intended to reduce unnecessary litigation, streamline pre- and post-election procedures, and facilitate the use of electronic communications and document filing."  The proposed changes include:

• shortening the period between the filing of a petition and the conduct of a representation period by days, if not weeks;
• deferring most voting/bargaining unit issues until after the election;
• eliminating the parties' ability to request review of a Regional Director's decision prior to the election;
• expediting the production of a list of employees and their contact information to the union, including phone numbers and email addresses; and
• allowing for the filing of election petitions and posting of notices electronically.

The Board received more than 65,000 written comments on the proposal and heard testimony from 66 speakers at a two-day hearing in July.  Senator Jim DeMint (R-SC) soon thereafter introduced “The Fair Representation in Elections Act of 2011” (S. 1425), which would guarantee that no representation election is held within forty (40) days after the filing of a petition, and until the Regional Director has resolved all jurisdictional, unit determination and eligibility issues.  Last month, the House Committee on Education and the Workforce voted to send Committee Chairman John Kline's (R-MN) similar bill, the "Workforce Democracy and Fairness Act" (H.R. 3094) bill to the floor.

In today's announcement, the Board indicates:

in light of the possibility that the Board will lose a quorum at the end of the current congressional session, Board Chairman Mark Pearce will propose issuing a final rule limited to several provisions designed to reduce unnecessary litigation.

The Chairman and the Board's other two Members will discuss and vote on a resolution to accept the Chairman’s proposals, proceed to draft a final rule limited to those proposals, and defer the remainder of the proposed rule for further consideration.

One might expect the Board to limit its consideration to the less drastic and controversial elements of its proposals, on which there appears to be unanimous consensus among the Board's three Members.  A dissenting Board Member could very likely prevent anything from being passed by simply stepping down prior to a vote, thereby denying the Board a quorum under the holding of the Supreme Court's decision in New Process Steel L.P. v. National Labor Relations Board, 08-1457.

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Late last week, Senator Johnny Isakson (R-GA) introduced the Representation Fairness Restoration Act (S. 1843) -- legislation designed to reverse the National Labor Relations Board's August 26, 2011 decision in the Specialty Healthcare case. In that decision, the Board overruled 20 years of practice regarding how it determines the "appropriate unit" in non-acute health care facilities.  More importantly, however, the NLRB has clearly signaled that it now endorses Member Becker’s long held belief that smaller units -- such as units that consist of only one department, or perhaps even one job classification -- should be permitted, rather than the current NLRB preference of favoring “wall to wall” units.  Sen. Isakson's legislation would reinstate the long-standing standard for determining which employees make up an appropriate bargaining unit for the purposes of the NLRA.

The text of the bill is not yet available online, but more commentary is available:

• "Mini-Unions: Isakson is Right" - Savannah Morning News
• "Senate Bill Would Nullify Specialty Healthcare Decision" -- Littler's Labor Relations Counsel
• "RILA Welcomes Bill to Reverse NLRB Decision in Specialty Healthcare" -- Retail Industry Leaders Association

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The National Labor Relations Board has published on its website a review of its "case production for FY 2011," declaring that the agency was responsible for "significant decisions and public engagement in a productive year."  The Board announced that it

issued 368 decisions in contested cases during Fiscal Year 2011 (October 1, 2010 through September 30, 2011) while also pursuing two rulemaking initiatives and seeking increased public engagement.

These numbers represent an increase of 17% over FY 2010, and the number of pending cases at the end of the fiscal year dropped to 209 from 236. Over 20% of this production came in August -- the final month Chairman Wilma B. Liebman's term.

Among the matters covered this year, the Board:

• invited briefs from the public in five cases of significant interest;
• sought public comment in two rulemaking proceedings -- the rule requiring all employers to post a Notice of rights under the NLRA; and another expediting union representation elections;
• issued the UGL-UNICCO and Lamon Gasket decisions which overruled prior Board decisions from 2007 and 2002 regarding election bars;
• issued the Specialty Healthcare decision overruling a 1991 Board decision, and opening the door for unions to organize sub-units of an employer;
• expanded the Board's remedial powers in the Kentucky River and J. Picini decisions, adding daily compound interest to backpay and other monetary awards; and requiring employers to post remedial notices electronically.

In a recent piece at The Hill, "Congress reasserts its role in labor law," former Chairman Peter Schaumber expressed his support for Rep. John Kline's (R-MN) introduction of the Workforce Democracy and Fairness Act (H.R. 3094).  The bill would reverse some of the NLRB actions highlighted in its FY 2011 report.  Mr. Schaumber wrote:

It is not the Board’s place to rewrite our nation’s labor laws to favor a perceived constituency, organized labor.  And Big Labor’s support for these actions is short-sighted.  The decline of unionization in the private sector is the result of a combination of social, political and economic causes, not our nation’s labor laws. 

The Board has also noted that 2011 was a "period of relative stability in terms of Board composition." Since Chairman Liebman's term ended on August 27, however, the Board has had just three members.  Looking toward the end of the year when Member Craig Becker's recess appointment expires, current Chairman Mark Gason Pearce concludes the Board's report with the assertion:

“The increased productivity in the last fiscal year demonstrates the value of having a stable and functioning Board to process cases and resolve labor disputes, which is exactly what Congress intended by creating staggered terms for Members. ... In the coming year, I hope we are able to continue providing this vital service to employers, unions, and above all, employees.”

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The Department of Defense, General Services Administration, and NASA have published a Final Rule in the Federal Register to implement Executive Order 13494, "Economy in Government Contracting."  The Order, one of three Executive Orders issued by President Obama on January 30, 2009 regarding labor relations, 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.  Following review of public comments, the agencies finalized the April 14, 2010 proposed rule with "just one minor editorial change" to FAR 31.205-21, the cost principle addressing labor relations costs:

To implement the requirements of the E.O., DoD, GSA, and  NASA issued a proposed rule that would amend this cost principle by adding a new paragraph addressing the handling of persuader activities--that is, activity involving the persuading of employees to exercise or not exercise their rights to organize and bargain collectively. By doing so, the proposed rule differentiated the handling of costs incurred through persuader activities, which are unallowable, from those incurred in maintaining satisfactory labor relations, which remain allowable.

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