UAW Withdraws Objections to Volkswagen Election

By Al Kinzer

Just before the NLRB hearing about the UAW objections to the VW election was to start, the UAW withdrew its objections to its 712-626 defeat in the February 2014 election. Thus, the UAW ended its legal battle to overturn the election results.

 

The UAW stated that pursing its objections would take months or years. There was already a fight brewing over the UAW’s subpoenas served on U.S. Senator Corker (R-Tenn.), Tennessee Governor Haslam, and about a dozen other Tennessee state representatives who publicly opposed the UAW’s effort to organize VW. The various elected officials had retained lawyers to move to quash the subpoenas. That issue was to be among the first for the hearing set to start on Monday, April 21. Instead, an hour before the start of the hearing, the UAW formally withdrew its election objections.

 

By withdrawing its objections now, the UAW (or another union) will be able to petition for a new NLRB election at VW next year. The NLRA bars another election at VW for 12 months. Thus, the UAW (or VW) can petition for another election next April.

 

In the meantime, the UAW continues its corporate campaign against Nissan. Last week at the New York Auto Show, the UAW announced that it would lead a civil rights-style march on the Nissan plant in Canton, Mississippi in June. The UAW’s goal is to publicly pressure Nissan to agree to recognize the UAW by signed union cards, rather than require a secret ballot election.

Fifth Circuit Refuses NLRB's Request to Rehear D.R. Horton

By Ben Shepler

The NLRB is now 0 for 2 in the Fifth Circuit Court of Appeals.  In a victory for employers, the Fifth Circuit recently refused to rehear (pdf) its December 2013 decision rejecting an NLRB ruling that questioned the wide-spread practice of having employees sign arbitration agreements that bar class or collective actions. 

In D.R. Horton, Inc. v. NLRB, the Fifth Circuit considered the NLRB’s January 2012 ruling which held that homebuilder D.R. Horton, Inc. committed an unfair labor practice by requiring employees to sign a mandatory arbitration agreement that (1) forced employees to submit employment-related disputes to binding arbitration and (2) prohibited the arbitrator from considering these disputes as part of a class or collective action.  The Fifth Circuit rejected this analysis, although it did agree with the NLRB that D.R. Horton’s arbitration policy improperly gave the impression that employees were prohibited from filing unfair labor practice charges with the NLRB. 

At this time, the NLRB has not indicated whether it will appeal the Fifth Circuit’s decision to the United States Supreme Court.  While we await word, labor professionals should review all individual, non-collectively bargained arbitration policies.  In particular, labor professionals should:

  • Determine whether to include a class or collective action waiver in their arbitration agreements.  Although the NLRB may not give up without a fight, the clear weight of legal authority supports enforcement of class or collective action waivers in arbitration agreements.
  • Make certain that their arbitration policies allow employees to file unfair labor practice charges with the NLRB.  The NLRA prohibits arbitration policies that would reasonably lead employees to believe that they are prohibited from filing unfair labor practice charges with the NLRB.

Employee Handbook "Savings Clause" May Preserve Employer Policies

Percolating for the last couple of years has been the question of whether a “savings clause” or a “disclaimer” in an employee handbook or policy manual would be sufficient to protect policies in the handbook from attack under the NLRA. In a significant decision earlier this month, the NLRB has answered that question with a resounding “maybe.”

To readers of this blog, it is no surprise that employer’s policies and rules of conduct are subject to challenge under the NLRA. This has always been the case, and has become even more prevalent over the last few years. Some have questioned whether a “savings clause” or a “disclaimer” would help the employer defend against these challenges. The idea is to include in the handbook or policy a statement that employees should not interpret any of the rules in a way that would deny rights under the NLRA.

In the recently decided case, the employer maintained what it called a “Freedom of Association Policy” in its employee handbook. The policy was apparently quite lengthy, spanning three pages of the employer’s 73-page-long handbook. The policy reaffirmed various employee rights, including a secret ballot election, “informed choice,” and “representative voter turnout.” The NLRB’s decision focused on the following sentence in the policy:

[D]uring union organizing campaigns, management shall support the employee’s individual right to choose whether to vote for or against union representation without influence or interference from management.

The employer argued that this policy precluded the NLRB from finding that employees would read any of its other work rules, which were also challenged in the case (see discussion below), as unlawfully restricting their rights under the NLRA.

The NLRB agreed that “an employer’s express notice to employees advising them of their rights under the [NLRA] may, in certain circumstances, clarify the scope of an otherwise unambiguous and unlawful rule.” In the particular case under consideration, however, the NLRB found that the Freedom of Association Policy was insufficient. 

First, the policy was too narrow. The NLRB suggested, without explaining further, that an effective “savings clause” should adequately address “the broad panoply of rights” protected by the NLRA. 

Second, the NLRB faulted placement of the disclaimer language. It found that it was neither prominent nor closely located in the handbook to the rules that the employer argued the policy informed.  Specifically, it was approximately thirteen pages away from the page on which various rules that the NLRB found unlawful were located.

Third, the NLRB noted the employer committed other unfair labor practices in connection with union organizing activity. This unlawful conduct contradicted the terms of the policy and thus the policy could not insulate the employer from liability from its otherwise lawful rules.

Member Johnson (R) agreed with the outcome on the disclaimer clause. However, he would not weigh the location of the “disclaimer” within the handbook as heavily as his colleagues.

In other holdings in the case, the NLRB found the following rules in the employer’s handbook were lawful:

  • A rule prohibiting employees from “using company property for activities not related to work any time,” which was located within a rule prohibiting stealing and theft from the employer;
  • A rule that prohibited “poor work habits including loafing, wasting time, loitering or excessive visiting,” because a reference to poor work habits is sufficient for a reasonable employee to understand that the rule is directed towards job performance; and
  • A rule prohibiting “profane or abusive language where the language used is uncivil, insulting, contemptuous, vicious, or malicious,” because the context of the introductory language made the overall purpose of the rule clear.

On the other hand, the NLRB found unlawful the following rules:

  • A rule prohibiting “discourteous or inappropriate attitude or behavior to passengers, other employees or members of the public” and “disorderly conduct during working hours,” because it was ambiguous and thus employees could reasonably construe it as limiting communication concerning their employment;
  • A rule prohibiting the disclosure of “any company information for any purpose other than to perform duties,” because failure to define company information permitted employees to read it as a restriction on disclosure of their own wage and benefit information; and
  • A rule prohibiting employees from making any statements about an accident to “anyone except the police or company officials,” because it was an unlawful “gag rule” on discussion of working conditions with other employees or with union representatives.

The NLRB’s decision raises a number of interesting issues and questions for an employer:

  • For those employers that do not have a “disclaimer” or “safe harbor” statement, consideration should be given to whether one should now be adopted.
  • For those employers that do have a “disclaimer” or “safe harbor” statement, the NLRB’s decision is a must read to determine whether the language used will be effective.
  • Many open questions exist for resolution in the future, like how many rights must be included, where the language must appear in relation to the challenged conduct rule, and what types or how many unfair labor practices may nullify the employer’s effort to draft effective language.

As the law in this area develops in future cases, probably the most interesting question will be how much of the language from its now-abandoned notice poster the NLRB requires to appear in the “disclaimer.” Surely, the NLRB saw its notice poster as a comprehensive statement of employee rights under the NLRA. Will this level of detail be necessary to address the “broad panoply” of rights requirement? It will surely be ironic if the NLRB’s case law develops in such a manner that the notice posting it attempted to mandate is adopted by employers voluntarily as a defense to possible unfair labor practice charges over the text of their employee handbooks and policy manuals.

General Counsel Answers Labor Practitioners' Questions

Earlier this year, the NLRB’s General Counsel (“GC”), who is responsible for enforcing the NLRA, continued the annual practice of attending the Mid-Winter Meeting of the Practice and Procedure Committee of the ABA Labor and Employment Law section. The GC answered questions the committee had collected from labor law practitioners around the country.

Late last month, the GC published a memorandum (pdf) summarizing the questions that were posed to him and the answers he provided. As in years past, the memorandum covers a wide range of topics that are too broad to cover effectively in this post. Labor professionals with a particular interest in practice and procedure issues before the NLRB will want to review the memorandum in detail.

Some of the noteworthy topics the memorandum covers, however, are listed below with parenthetical references to the page(s) in the memorandum on which the discussion appears:

  • An extended discussion regarding settlement issues, including consultation with charging parties by the regional office regarding settlement (2), plans to post settlement agreements online to the NLRB’s electronic docket system (3), and announcement of a forthcoming memorandum containing guidance about default judgment procedures (3-4);
  • An interesting discussion of examples of cases in which pre-arbitration and post-arbitration deferral have, and have not, been permitted (4);
  • The GC has no immediate plans for additional guidance memoranda regarding work rules and employee handbooks, but the GC does discuss several issues currently pending before the NLRB that are of particular note, including retail store bargaining units, and religiously affiliated education institutions (7);
  • Significantly, given the pending rulemaking on election procedures, the GC reports that unions won just over 64% of all representation cases filed and that the median number of days from petition to election in fiscal year 2013 was 38 (13); and
  • The GC indicates that there is no other rulemaking activity being considered or drafted (14).

NLRB (Again) Invalidates Employer Conduct Policy

As readers of this blog know, the NLRB is quite interested in what the employee’s handbook or policy manual says.  A recent decision from the NLRB underscores this interest.

A hospital published a “Values and Standards of Behavior” policy that, among other things, contained three different rules:

  • A rule prohibiting employees from making “negative comments about our fellow team members”;
  • A rule prohibiting employees in engaging in or listening to “negativity or gossip”; and
  •  A rule that required employees to “represent [the hospital] in the community in a positive and professional manner in every opportunity.”

The hospital asked employees to sign poster-sized copies of the policy, which were framed and placed in the lobby so that patients could see them. The hospital also asked employees to sign individual copies of the policy, which were placed into employees’ personnel files, and included the policy in its human resources policy manual. The hospital adopted the policy after obtaining employee involvement in the development of the rules.

The NLRB, in a 3-0 decision, held that the first two rules were unlawful.  The fact that employees were involved in their development did not protect the rule from a challenge that it was an unlawfully over broad and ambiguous prohibition on employee conduct.  Employees could reasonably construe the rules to prohibit protected, concerted activity.

The NLRB also found that the third rule was unlawful, but over the dissent Member Johnson (R).  The majority reasoned that the third rule was just as overbroad and ambiguous as the first two rules.  Employees could reasonably view the rule as preventing them from engaging in any public activity or statements that are not “positive” towards the hospital on work-related matters. Thus, the majority reasoned that the rule would discourage employees from engaging in public protests of unfair labor practices or from making statements to third-parties protesting their terms and conditions of employment.  Moreover, the context of the rule in this case didn’t provide any limitation on how broadly an employee could read the rule. 

For the labor professional, the case is a good reminder of the importance of carefully reviewing the content of your handbook with labor law counsel.  Moreover, as prior posts have emphasized, this case demonstrates that the context in which any particular rule is placed can determine its legality.

NLRB Regional Director Holds Northwestern University Football Players Are Employees, And Can Unionize

By: Nelson D. Cary, Michael J. Shoenfelt

Yesterday, the NLRB’s regional director for Region 13(Chicago), Peter Ohr, issued a 24-page ruling in which he held that college football players at Northwestern University were employees entitled to the right to organize.  Ohr reasoned that the players met the standard for an employee under the NLRA and common law:  a person performing services for another under a contract of hire, subject to the employer’s control or right of control, in return for payment.

In the relevant analysis, Ohr determined that the scholarship “tender” made to the players was an employment contract, subjecting the players to the University’s control in return for compensation in the form of an academic scholarship and living expenses.  Ohr provided an extensive overview of the players’ daily schedule throughout the year, and discussed how the players’ academic and personal pursuits could sometimes conflict with, and even be dominated by, their athletic commitments.  Ohr differentiated between scholarship players and uncompensated “walk-ons,” who receive no remuneration at all in return for their play, holding that walk-ons did not meet the definition of employee.

The most obvious hurdle for Ohr was distinguishing the student athletes here from graduate students on scholarship, whom the NLRB determined ten years ago were not employees.  Brown University, 342 NLRB 483 (2004).  In Brown, the NLRB reached its determination after analyzing four factors:  (1) the status of graduate assistants as students; (2) the essential role of the graduate student assistantships in graduate education; (3) the graduate student assistants’ relationship with the faculty; and (4) the financial support they receive to attend Brown University.  Ohr held that the players would be considered employees even under this test.  In a section sure to draw fire from the NCAA, Ohr first noted that the players “are not ‘Primarily Students.’”  Ohr added that playing football was not a core part of the athletes’ academic curriculum, they had no supervision by academic faculty, and that their athletic scholarships were distinguishable from financial aid offered to graduate students.  Accordingly, Ohr determined that the players were employees, and directed an immediate election for a bargaining unit consisting of all scholarship players who had remaining eligibility.

Reaction to the decision was swift.  The NCAA issued a statement that it was “disappointed” with the decision and that it “strongly disagree[d] with the notion that student-athletes are employees.”  Northwestern indicated that it would appeal the decision to the full board in Washington, D.C.  At least one mainstream press outlet predicted that the ruling would “change college football as we know it.” 

For the labor professional, the question arises as to whether this decision opens the door to other employment-related claims.  If college football players are employees, can they file race or national origin discrimination claims under Title VII, or wage and hour claims under the FLSA, for example?  More broadly, will this decision lead to the President Obama-appointed NLRB reconsidering the decision in Brown University, and holding that all students on scholarship are employees? This story is still in its infancy, but will surely be followed closely by national sports media as it progresses.  It will also be monitored by labor practitioners, as it has the potential to spin off dozens of representation elections if the full Board upholds Mr. Ohr’s decision.

UAW's Election Objections At VW Take An Interesting Turn

By Al Kinzer

On March 10, 2014, the NLRB Acting Regional Director issued an order allowing two groups of VW workers opposed to the UAW and an another organization to intervene in a hearing on the UAW’s effort to have its election defeat set aside. After the UAW’s 712-626 defeat at Volkswagen, the UAW filed objections to the election based on the conduct of certain Tennessee politicians and certain “outside” groups.

In its election objections, the UAW specifically targeted two “outside” groups, National Right to Work Foundation (NRWF) and Southern Momentum. Both the NRWF and Southern Momentum have been representing VW workers opposed to the UAW and assisted those workers in campaigning against the UAW. On behalf of certain VW workers opposed to the UAW, both the NRWF and Southern Momentum moved to intervene in the UAW’s efforts to toss out the NLRB election results. 

Not surprisingly, the UAW opposed the NRWF and Southern Momentum’s motions. Somewhat surprising was that VW actively opposed the motions, though both organizations represent VW workers.

Despite the UAW and VW’s opposition, the NLRB’s Acting Regional Director in Atlanta granted both NRWF and Southern Momentum’s motions to intervene, meaning that those organizations can fully participate in the hearing on the UAW’s election objections by: 

  • Offering evidence in rebuttal to the UAW’s objections;
  • Cross-examining the UAW’s witnesses; and
  • Filing legal briefs before the NLRB.

The NLRB has not yet set a date for the hearing on the UAW’s objections, but with the NLRB’s recent order, the hearing could become quite the event. The UAW now has an interesting strategic decision. If the UAW goes forward with its objections, the NLRB hearing could turn into the labor law equivalent of the Scopes Monkey Trial. It will also start a legal process that could take over a year, and that time is significant.

Under the NLRA, a union that loses an election can petition the NLRB for another election one year after the NLRB has certified the election results. The NLRB, however, cannot certify the election results until all election objections are resolved. Thus, because of the UAW’s election objections, the NLRB has not certified the UAW’s defeat at VW. Accordingly, the one-year period has not yet started to run. If the UAW had not filed election objections, it could have petitioned for another election as early as February 22, 2015. Because of its objections, the UAW may have delayed when it can petition for another election.

Such a delay became even more likely when, late on March 12, 2014, the UAW announced its intention to appeal the Acting Regional Director’s order granting NRWF and Southern Momentum’s motion to intervene to the NLRB in Washington D.C.

U.S. Supreme Court Clarifies Rules Regarding Donning and Doffing of Gear

Last month, the U.S. Supreme Court decided a significant case regarding claims involving donning and doffing for unionized employers. And no, donning and doffing are not Santa’s new reindeer. Rather, “donning” refers to putting on protective gear, clothing, or uniforms before the start of work, while “doffing” refers to taking off those items at the end of the work day. In Sandifer v. U.S. Steel Corp., the Court held that employees were bound by the terms of their collective bargaining agreement, which provided that they were not on the clock – and thus not to be compensated – for time spent donning and doffing their protective gear. 

By way of background, employers are generally required under the Fair Labor Standards Act (FLSA) to pay employees for time spent while donning and doffing their protective gear, if the protective gear is required by the employer and if the employee is required to change into and out of the gear at work. As is sometimes the case, however, there is an exception. If there is a collective bargaining agreement (CBA) governing the employment relationship, and if the parties have agreed in the CBA to exclude from hours worked “time spent in changing clothes or washing at the beginning or end of each workday[,]” then time spent doing so is not compensable.

The chief issue in Sandifer revolved around the phrase “changing clothes.” The employees argued that a provision in their CBA that excluded the changing of clothes from compensable time was not subject to the above exception because donning and doffing protective gear was not the same as “changing clothes.” Specifically, the employees claimed that clothes are meant for “decency and comfort,” whereas the protective gear they were donning and doffing off each day (comprised of 12 separate pieces of protective clothing) were geared more towards protection against workplace hazards. Thus, they argued, the exception did not apply.

The Court disagreed, refusing to take such narrow interpretation of the word “clothes.” The Court found it important that the statute did not specifically exclude protective clothing from the definition of clothes. The Court also rejected the employees’ narrow interpretation of “changing,” finding that “changing clothes” does not literally mean taking off one article of clothing and replacing it with another, as the employees’ suggested, but rather that it meant “time spent in changing clothes includes time spent in altering dress.”

In light of the Court’s decision, labor professionals working for employers where employees must change clothes, including the donning of some protective gear, prior to beginning work should take note. The decision makes clear that a provision in a CBA that excludes such clothes changing time is effective. 

If the CBA does not contain such a provision, consideration should be given to adding one in the next round of bargaining. If the CBA does contain such a provision, the employer should review whether the types of “clothes” that are donned and doffed and the amount of time spent doing so are sufficiently similar to the facts in Sandifer to ensure a similar result if challenged.

UAW Files Objections to VW Vote

By Al Kinzer

Seeking to set aside its loss, the UAW filed formal objections to the VW election with the NLRB. The UAW alleges interference with the NLRB election process by third parties. The UAW requests that the NLRB set aside its 712-626 loss in the February 14 election and conduct another secret-ballot election. The UAW has until February 28, 2014, to submit evidence to the NLRB to support its allegations.

The UAW alleges the following instances of outside interference that it says improperly affected the vote:

  • A coordinated, widely-publicized campaign by Tennessee Governor Haslam and other state political leaders, disseminating threats that state tax incentives and other financial benefits would be withheld from VW if the VW workers voted for the UAW;
  • The creation of a new non-profit organization called Southern Momentum that repeated and broadcast the alleged threats by the Tennessee politicians;
  • U.S. Senator Bob Corker’s publicized comments that VW would expand and build a second production line in Chattanooga if the workers voted against the UAW; and
  • The cumulative effect of all of the above that led employees to believe that a vote in favor of the UAW might put their jobs at risk.

None of the interference the UAW alleges centers on VW, the employer. The NLRA regulates the employer’s conduct, but does not regulate the conduct of national or state politicians.

In its NLRB objections, the UAW conveniently ignores the political support it received from President Obama during the VW voting.

After the UAW submits its evidence to the NLRB, the NLRB will then decide whether it will conduct an investigation into the UAW’s allegations.

VW Workers Reject the UAW

By Al Kinzer

By a vote of 712 to 626, the VW workers in Chattanooga rejected UAW representation. The defeat leaves the UAW in a precarious state. The UAW was hoping to use a victory at VW as momentum for its campaigns at Nissan in Canton, Mississippi, and at Mercedes Benz in Vance, Alabama. Instead, the UAW finds that it invested heavily over the past two years in a losing effort, and its cash is declining. In four months, the UAW will increase its monthly dues 25% to try to stop the cash drain. The dues increase will likely make it harder for the UAW to sell its representation.

The loss is particularly difficult for the UAW because the UAW had the near-perfect conditions to win. VW had signed a written contract to remain “neutral.” Arguably, VW went beyond “neutral” by favoring the UAW. VW management permitted UAW organizers to sell UAW membership inside the plant and during company meetings. VW let the UAW organizers use an office near the production floor and allowed the UAW organizers to set up tables in the cafeteria and break areas. It is hard to imagine a more favorable climate for a union preceding a secret ballot election.

Yet, there was opposition. A group of VW workers started opposing the effort. The National Right to Work Foundation represented VW workers opposed to the UAW, and a new non-profit organization called Southern Momentum helped the group produce videos and other campaign material against the UAW. 

Then, the Southern politicians spoke.  At first, U.S. Senator Bob Corker said that he would remain silent during the last week of the campaign. Sen. Corker, a native Chattanoogan and former Mayor, was instrumental in recruiting VW to the city. But just before voting began, Sen. Corker broke his silence because he claimed that the UAW was using his silence in its favor. In a press conference and repeatedly through the voting time, Sen. Corker stated that he had been assured by VW officials that, if the UAW was rejected, VW would expand the plant and build its new SUV in Chattanooga. VW’s local President denied providing any such assurances.

Other Tennessee officeholders joined in. Some stated that if the UAW were elected, VW would have a hard time getting tax incentives for the plant. Others said that a UAW victory would make it hard to encourage other employers to locate in Tennessee.

The UAW is blaming the loss on those Tennessee politicians and says that it is considering legal challenges. However, the NLRA governs the conduct and statements of the employer during union elections. The Act does not govern the behavior of politicians. Thus, unless these statements can be tied to VW, it is difficult to see what the UAW’s legal challenge may be.

If these statements by the Tennessee politicians had any effect on the outcome of the election, they may have provided a guide for politicians in Alabama and Mississippi in opposing unionization there.  Despite the UAW’s claims to the contrary, it is difficult to prove that these politicians’ statements had any effect.

One national politician entered the fray on the last day of voting. President Obama declared his support for the UAW.  It is far more likely that the well-organized opposition by several hundred VW workers impacted their voting co-workers more than any politicians’ statements, for or against.

The UAW has until Friday, February 21, 2014, to file any challenges to the vote with the NLRB.