Vorys on Labor

Vorys on Labor

Insights for the Labor Relations Professional

NLRB Revisits Independent Contractor Definition

Posted in NLRB, Union Organizing

Employees are permitted to join unions.  Independent contractors are not.  Thus, whether a particular working relationship involves an “employee” or an “independent contractor” is extremely important.  Recently, the NLRB has made it easier to establish employee status and correspondingly more difficult to establish independent contractor status.

Delivery DriverThe case involved delivery drivers for Federal Express Home Delivery.  The facts of the case are quite lengthy.  Thus, I will include only a highly condensed summary of them in this post. 

Each of the drivers sign an operating agreement with the company that describes the driver as an independent contractor.  The drivers can negotiate over the particular route assigned to them and over one aspect of their compensation.  Otherwise, the drivers cannot negotiate over the agreement and the company is able to make unilateral changes to it once a year upon 30 days notice.

The drivers own their own vehicles and can determine the make and size of vehicle, but the company can decide whether the vehicle is suitable.  The company requires the vehicles to display FedEx logos and drivers are required to submit daily logs and other reports pursuant to U.S. Department of Transportation regulations.

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Confessions of a Union Supporter

Posted in Union Organizing, Unions

In my labor law practice, I’m often asked:  “Why do employees support unions?”  My answer to this question usually comes from what I have gleaned from my years of experience providing legal advice to management during union organizing campaigns.  It isn’t often that you have the opportunity to hear directly and in detail about the reasons an employee would be interested in joining a union.  Management cannot, of course, ask that question of its employees. 

It is thus with significant interest that I noted an interview on The Washington Post’s website by Lydia DePillis (it may be necessary to scroll down after clicking the link).  The article contains a “slightly condensed” interview of an employee of American Airlines who recently voted in a union election.  That election resulted in a victory for the Teamsters and the Communication Workers of America in connection with representation of over 14,000 customer service representatives for US Airways and American Airlines.

The article generally discusses the employee’s experience during a reported 19-year-long effort to organize this group of workers.  When I read the article, however, four different passages appeared to describe reasons for the employee’s support of the organizing effort.  I have highlighted those passages in the quotes below, preceded by the reason to support the union that I thought the passage articulated. 

  • Job security.

We have life insurance, we have car insurance, and now we have some job insurance with representation with the union.”

And, a little later in the interview, “American [Airlines] hasn’t really outsourced overseas, we just didn’t want that in the future.”

  • Fairness/Subjectivity.

Naturally in a company, you have office politics, and sometimes you have office favorites, and all I can say is there are those that didn’t want that policy to change.  But, it’s going to be a little bit less subjective, and a little bit more in writing in the contract, less local policy and more across the board.  People will not think ‘if only I was treated a little more fairly, like x, y and z.’  There’s not going to be that envy of how another person was treated in a similar situation.”

  • More money.

I have general expectations that we’ll have a benefits increase, we’ll have a wages increase.  I’m just looking at the US Airways contract – even their health insurance is better than American Airlines for people who take reservations.”

  • Different working conditions between different groups of employees doing substantially similar work.

More than 50 percent of the people in reservations now are home-based and make a lower salary, have dramatically less benefits than office-based workers.  So they were a great help, because obviously they had a little more incentive than the office-based workers to organize amongst themselves.”

Of course, the views of one do not necessarily represent the views of many.  Moreover, a single interview does not make for a comprehensive list.  Nonetheless, the article helps shed light on an important question for labor professionals to consider, and one that I get asked with some frequency.

Protecting the Employer’s Brand During a Labor Dispute

Posted in Union Organizing

The NLRB makes it hard to protect a company’s investment, which can be substantial, in its brand. A recent decision demonstrates the perils that employers can encounter for their brand during a labor dispute. The case involved the national sandwich franchise, Jimmy John’s, and one of its franchisees in the Minneapolis-St. Paul area.

The franchisee’s workers began a union organizing effort. One of the issues that employees wanted to address was a right to have paid sick days. The franchisee’s policy provided that employees could not “simply” call in sick, but instead had to arrange for someone to take their place. Employees did not receive paid sick days. Employees believed the policy encouraged employees to work while sick, which in turn posed health risks to consumers of the sandwiches the sick employees prepared.

To address this concern, employees prepared a poster (pdf) and a letter to the franchisee’s owner. The employees demanded a meeting to discuss the sick leave policy. Failure to have a meeting, the letter advised, would result in the employees putting up the posters in public areas near the franchisee’s stores. The union attempting to organize the employees also put out a press release, attaching a copy of the poster.

 

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Employers Won’t “Like” This One: NLRB Holds Facebook “Thumbs Up” Is Protected Concerted Activity

Posted in NLRB

By Ashley Manfull

Numerous actions by the NLRB’s General Counsel and administrative law judges (highlighted in prior posts on this blog) have caused great concern for labor professionals grappling with the inappropriate comments of employees posted on social media. While these actions have made it difficult enough to determine whether employees’ online comments sufficiently cross the line to take lawful disciplinary action, the NLRB now adds to the confusion, finding employees who simply click “Like” in response to a Facebook post may be engaging in protected, concerted activity.

social mediaOn August 22, 2014, the three member NLRB panel issued a unanimous decision in Triple Play Sports Bar and Grille, 361 N.L.R.B. No. 31, finding an employer unlawfully discharged two employees for their participation in a Facebook discussion involving claims that the bar made withholding mistakes which caused the employees to owe additional state income taxes. The conversation started when a former employee posted a “status update” complaining that she owed money because the bar did not do her tax paperwork correctly. The former employee stated:  “Maybe someone should do the owners of Triple Play a favor and buy it from them.” Other employees commented on the former employee’s status, echoing their dissatisfaction in various profanity-laced statements. The former employee who posted the initial status later added a comment accusing the owner of pocketing money from their paychecks. 

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Cry “Solidarity” and Let Loose the NLRB: A Significant Expansion of the NLRA’s Protections

Posted in NLRB

A recent NLRB decision will likely result in a significant expansion of the activity the NLRA protects. The case, Fresh & Easy Neighborhood Market, Inc., 361 N.L.R.B. No. 12 (2014) (pdf), arose from a complaint about sexual harassment. A female employee – Elias – placed a message on a whiteboard at the request of her supervisor. A word in that message was subsequently changed to an inappropriate term for the workplace, and a drawing of a peanut or worm urinating on the employee’s name was added. 

Upon seeing her changed message, Elias told her supervisor that she wanted to file a sexual harassment complaint. She also wrote out the message on a piece of paper and asked, albeit apparently not in a very polite or subtle fashion, a supervisor and two other co-workers to sign that piece of a paper as “witnesses” that she had copied down the words and drawing correctly. While the other employees did so, one later complained to the employer that she was “bullied” into signing the paper by Elias. Another employee later testified that she signed only because Elias was making a scene in front of customers. No one signed the paper intending to take group action.

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Union Organizing in 2014

Posted in Union Organizing

By Susan Connelly of PTI Labor Research, Guest Blogger*

PTI Labor Research analyzed union representation petitions that were filed within the first half of the year.  

States with the most petitions filed (pdf) included:  New York, California, Illinois, Pennsylvania and New Jersey.  Each of these top five states are “Non-Right to Work,” where it is legal to negotiate a union security clause that requires employees to pay the union fees in order to retain their jobs.

Maps of the 1,069 representation petitions (pdf) and the 244 decertification petitions (pdf) that were filed within the first half of the year highlight a definite lack of petitions within the “Right to Work States” of Idaho, Wyoming, Utah, South Dakota, North Dakota, Nebraska, Oklahoma and Arkansas.

Industries with the most union active organizing (pdf) included:  Business Services (janitorial, security, etc.), Health Care, Local and Suburban Transit, Electric, Gas and Sanitary Services, and Motor Freight Transportation and Warehousing.  This keeps with the overall decades-long trend of unions moving away from traditional manufacturing and towards service sector jobs. 

The unions that most often filed organizing petitions to represent employees (pdf) were:  the Teamsters, the Service Employees International Union, the International Operating Engineers Union, the United Food and Commercial Workers and the International Brotherhood of Electrical Workers. Though most unions will file petitions in most industries, the SEIU is very active within Health Care specifically, the UFCW within entry level service jobs, the Teamsters within Trucking and Warehousing and the IUOE and IBEW within skilled maintenance, engineering or electrical job units. 

The number of petitions filed (pdf) has held relatively steady for past five years, but is down from what we saw a decade ago.  

Though much attention has been on “micro-units” this year, there have been a few notable elections in 2014 with large voting groups.  In a surprising upset, nurses at Sutter Valley Hospitals’ Memorial Medical Center in Modesto, California voted against representation by the California Nurses Association union on May 27th with a vote count of 462 “No” votes to 352 “Yes” votes.  In addition, though employees rejected the United Steelworkers union in February of this year at Novelis Corporation in Scriba, NY, the case is currently under review due to allegations of company violations. 

With the Board currently reviewing a number of cases after the Noel Canning decision, we shall see if expedited election rules come into play before the year’s end and, if so, we could anticipate a spike in union petition filings. 

Though union organizing in the fast food industry was a hot topic in the first half of the year, few petitions have been filed within the industry.  With the amount of organizing dollars being spent for fast food workers, we can also anticipate more petitions for this group.

* Ms. Connelly is not an attorney.  Neither she nor her firm is affiliated with Vorys, Sater, Seymour and Pease, LLP.  The opinions and views expressed in this post are her own and not intended to convey legal advice. 

A Limit on Micro-Unions for Now, but Long-Term Significance of Limitation Uncertain

Posted in NLRB, Union Organizing

On the heels of the much anticipated decision involving the Macy’s department store chain, discussed on this blog last week, the NLRB on Monday released its opinion in a similar case involving Neiman Marcus. Unlike the outcome in  the Macy’s case, however, the NLRB found the bargaining unit that the union sought to represent was not an appropriate one, dismissing the union’s representation petition. While the decision does place a limit on the NLRB’s “micro-unions” ruling in Specialty Healthcare, the actual significance of the limitation will only become clear with the passage of time. 

Young woman trying on sandals in a shoe storeIn the Neiman Marcus case, the union sought to represent a group of approximately 46 shoe sales associates in two different women’s shoe departments in the employer’s store on Fifth Avenue in New York City. One shoe department was the “Salon” shoes department and another was the “Contemporary” shoe area, which was part of a larger Contemporary Sportswear department. These two areas were located on two different, non-adjacent floors of the employer’s store. 

Given the structure the employer’s operation, the employees at issue had significantly different management. They had different directors, different floor managers, and different department managers. On the other hand, the employees had certain terms of employment that were in common with one another, such as vacation, holidays, and health insurance coverage. The employees in both departments were paid based on commission, although the rates were slightly different. There was no formal shoe sales training program after the initial employee orientation. The employees were encouraged to make sales in other departments.

On these facts, the NLRB unanimously held that while the group of employees the union sought to represent were “readily identifiable” – in that they were all the sales associates involved in selling women’s shoes – the employees were inappropriately grouped together because they lacked a “community of interest.” First, the proposed group did not follow any of the employer’s administrative or operational lines. In particular, the Contemporary shoe employees were part of a larger Contemporary Sportswear department and were being carved out to be included with the Salon shoe employees for organizational purposes. 

Second, there was no substantial interchange between the Salon shoe employees and the Contemporary shoe employees. They had only limited contact with one another and did not sell product in one another’s departments. Because the employees did not share a community of interest, the NLRB did not look at whether there was an “overwhelming” community of interest with a larger group of employees, in which the union election should have taken place. 

For the labor professional, the opinion is important for at least three reasons:

  • It provides an example of a limitation on Specialty Healthcare and the “micro-units” that might otherwise be approved.  Thus, it suggests that there is at least some limit to the number of unions an employer’s workplace could support.
  • At the same time, however, it provides a road map to unions on getting small units approved. The NLRB comments at various points in its opinion about the type of evidence that may have justified a finding that there was a community of interest. Thus, the decision may well ultimately advance the cause of micro-unions, rather than slow it down.
  • Finally, it demonstrates that employers have the ability to influence, through their regular operations and structure, how their employees would be grouped together in the event of union organizing activity.  Employers that approach this issue proactively, therefore, should consult with qualified labor law counsel for advice.

How Many Unions Can Your Workplace Support?

Posted in NLRB, Union Organizing

When most people think about unions, they think about a single union that represents all of the employees at a single workplace. For example, one may think about the UAW and a car company or the USW and a steel manufacturer. But the NLRA doesn’t require that outcome, and the NLRB’s decisions in the last few years have made it much easier for unions to avoid organizing all employees in a particular workplace. 

Instead, it is increasingly easy for unions to select some subset of the employer’s workforce to organize. And, if there are several different possible groups of employees to organize at any one business, then each employer could end up with multiple bargaining relationships. Employers could have more than one union representing different groups of employees. 

A significant decision that highlighted this possibility was Specialty Healthcare, which this blog covered a few years ago. That case arose in the non-acute healthcare setting. In a decision released yesterday, however, the NLRB made clear that the principles announced in that case were going to be applied far more broadly. The case involved the Macy’s department store chain.  The NLRB applied Specialty Healthcare to permit a union election in a group made up of only cosmetics and fragrance sales employees and counter managers in one of the chain’s stores.

Macy’s had argued that the only appropriate group of employees for purposes of a union election was a group of all employees at the store or, in the alternative, a group of all selling employees at the store. The NLRB, in a lengthy 3-1 decision (pdf), rejected this position. In reaching its conclusion, the majority reasoned that the cosmetics and fragrance counter employees and counter managers were a “readily identifiable group” that matched a “departmental line” that the employer drew. 

In addition, the majority found that employees shared a community of interest. Thus, for example, all of the cosmetics and fragrance employees:

  • Had the same first level supervisor (even though the Store Manager, the second level supervisor, exercised control over all employees in the store);
  • Worked in “two connected [by virtue of an escalator bank], defined work areas” (even though they were on different floors and were adjacent to the areas where other selling employees worked);
  • Had limited interaction with other employees (even though they attended daily “rally” meetings with all employees in the store);
  • Received training from vendors (even though it was different types of training from different venders); and
  • Were paid on commission (even though the amount of that commission varied between them).

Consistent with Specialty Healthcare, the majority went on to find that the employer did not prove that the selling employees in other departments of the store had an “overwhelming” community of interest with the cosmetics and fragrance employees. The majority also rejected the notion that there was a “presumption” in the retail industry for bargaining units that included all of the selling and/or non-selling employees in the store.

Member Miscimarra (R) dissented. He would have found that the only appropriate unit included all selling associates in the store, not just the ones found in the cosmetics and fragrance department. Initially, there were certain working conditions and benefits that were common to all salespeople that justified grouping them together. Next, the cosmetics and fragrance employees had various similarities and differences between them that matched, in a number of different respects, the similarities and differences between selling employees in other departments. Thus, there was no basis to conclude that the cosmetics and fragrance employees should be in a group by themselves. Finally, Member Miscimarra wrote a spirited critique of Specialty Healthcare, a decision that he would not apply in this case, or in any other.

For the labor professional, the Macy’s decision:

  • Reinforces the trend to smaller bargaining units;
  • Demonstrates that Specialty Healthcare will certainly be applied outside the non-acute healthcare setting;
  • Makes more likely the prospect, as we warned when commenting on Specialty Healthcare, of numerous unions representing different groups of employees; and
  • Is a warning to employers concerned about union organizing activity to examine critically the structure and operational deployment of their workforces – just how many unions could your workplace support?

The UAW Forms Local Unions to Represent Workers at VW and Mercedes

Posted in Union Organizing

Despite losing the union election at VW in February by a vote of 712-626, the UAW has announced that it is forming a local union to represent the workers at VW.  Additionally, VW management and the German union, IG Metall, have agreed that the UAW Local will have a seat on VW’s Works Council that bargains with VW globally.

The UAW claims that it will not charge dues for membership into the UAW Local until VW and the UAW Local actually negotiate a collective bargaining agreement.  Also, the UAW states that it will not demand to negotiate a collective bargaining agreement with VW until the UAW Local has a majority of VW’s Chattanooga workers as members.

Thus, with the help of VW management and the IG Metall union, the UAW is taking a different route to gain recognition by VW. 

The UAW has also announced the same plan at Mercedes in Alabama.  The UAW has never filed an NLRB election petition at Mercedes, but it is forming a UAW Local with the same deal from Mercedes management and the IG Metall union.  The UAW Local will have a seat on the Daimler World Employee Committee.

The UAW’s efforts to organize the transplants has been stymied because the UAW has never been able to convince a majority of the employees to vote “yes” for the UAW in a secret ballot election.  Consequently, the UAW is taking a different approach.  It still must sell “membership” to the VW and Mercedes employees.  The strategy appears to be that with membership on the international bargaining committees, the UAW Locals will have a legitimacy that will help them sell membership. 

The strategy is reminiscent of that proposed by retired Law Professor Charles Morris in his book, The Blue Eagle at Work.  In the book, Professor Morris argues that employers are required to bargain with minority “member-only” unions under the NLRA.  He proposed that unions should use this strategy to grow union membership, as opposed to using the NLRB election route.

It will be interesting to see how this develops and whether the UAW can sell this form of membership to the unions.  Certainly this new approach would not be possible without the assistance of management and the German union.

Supreme Court Deals Blow to Public Sector Unions

Posted in Union Membership

In a close decision earlier this week, the U.S. Supreme Court dealt a blow to unions representing government employees. The case, Harris v. Quinn, dealt with an effort in Illinois to permit unions to organize a group of individuals who provide services to those who are unable to live in their own homes without assistance. Under the federal Medicaid program, states can establish programs that provide services to those who would otherwise have to be institutionalized. The programs pay for individuals who provide services to individual customers pursuant to a personal care plan that is unique to that customer. Many of these care providers are relatives of the person receiving the care.

Through actions of both then-Governor Rod Blagojevich (D), and later the legislature, the state permitted a union to organize the personal care providers. The Service Employees International Union (“SEIU”) did so successfully, and ultimately entered into a collective bargaining agreement that included an “agency fee” provision. An agency fee is similar to union dues, and the agency fee provision here was authorized by state law.

 

A group of personal care providers objected to paying a mandatory fee to the SEIU because they did not want to support the SEIU. They sued the governor and the union alleging a violation of their First Amendment rights. They lost in the lower courts based on a 1970’s ruling in a case called Abood v. Detroit Board of Education, which the lower courts interpreted as permitting the assessment of a mandatory fee payable to a union by public employees whom the union represents for purposes of collective bargaining.

 

In its decision, however, the Court rejected the Abood case as controlling. That case, the Court said, involved public employees. The personal care providers here were not public employees because the customer — the person receiving the care — controlled the significant aspects of their employment, and the state’s control was very narrow. Thus, the state was not the employer of the personal care providers.

 

Rather than apply Abood, the Court determined that the agency fee provision did not serve a “compelling state interest that cannot be achieved through means significantly less restrictive of associational freedoms.” The agency fee did not serve the goals of “labor peace” or the promotion of the welfare of the personal care assistants. Thus, the agency fee couldn’t survive the constitutional challenge.

 

The dissenting justices disagreed strongly on the question of whether Abood applied. Those justices held that it did, based on the “joint employer” doctrine. That is, the state and the customer were both the employer given that they both exercised authority over different aspects of the personal care providers’ “employment.” For these and other reasons, the dissent would have found the agency fee provision constitutional.

 

For the labor professional, especially in the public sector, the case is quite significant:

  • The Court’s questioning of Abood all but invites a challenge by a government worker to an agency fee provision. According to the Bureau of Labor Statistics, there are 7.3 million employees in the public sector who belong to a union.  Agency fee statutes exist in a number of different states and surely a significant percentage of these public sector employees have been required to pay money to a union that engages in collective bargaining on their behalf.
  • According to some reports, the SEIU could lose millions of dollars in revenue as a result of this decision. Other unions who have organized workers similar to the personal care providers may face similar revenue losses. Organizing activity could, as a result, pick up as these unions seek to make up lost revenue.
  • It will be interesting to see whether the Court’s treatment of the joint employer issue in this case finds its way into private sector cases. As previously reported on this blog, the NLRB recently solicited briefs on the question of whether to overturn 30 years of precedent in the private sector on the joint employer standard.