Vorys on Labor : Labor Relations Lawyer & Attorney: Vorys, Sater, Seymour and Pease Law Firm: National Labor Relations

The National Labor Relations Board (“NLRB”) has proposed a rule that would require employers to post notices informing workers of their right to unionize. The NLRB rarely uses its rulemaking authority, and the proposed rule is the first time the NLRB has invoked that authority since 2004. 

Under the proposed rule, all employers subject to the National Labor Relations Act (“NLRA”) would have to post an 11-by-17 inch poster educating employees of their rights under the NLRA. The notice would have to be posted where the employer posts other workplace notices, such as safety, wage and hour, and anti-discrimination posters. Employers that primarily communicate with employees via email or other electronic means would have to also post the notice electronically. 

If an employer failed to post the notice, it could be penalized.  The NLRB would treat such a failure as an unfair labor practice.  It would also suspend the statute of limitations that would otherwise be applicable and could use the failure to post the notice in the context of other unfair labor practice charges unrelated to the notice posting issue.

The proposed rule represents a notable departure from the NLRB’s typical practice of requiring employers to post notices only as a remedy for noncompliance with the NLRA or a few days in advance of an NLRB-conducted election. According to the explanation accompanying the NLRB’s proposal, the NLRB’s broad enforcement of a posting requirement is rooted in its belief that employees are “unaware of their rights under the statute.” Indeed, the NLRB’s press release says that the purpose of the proposed rule is to “increase knowledge of the NLRA among employees, to better enable their exercise of rights under the statute, and to promote statutory compliance by employers and unions.”

To that end, the proposed notice will state that employees have the right to:

• act together to improve wages and other terms and conditions;
• form, join, or assist unions;
• bargain with their employer;
• discuss union organizing with co-workers or a union;
• raise work-related complaints with their employer, a governmental agency, or a union;
• strike and picket; and
• choose not to engage in any of these activities. 

The notice would also provide examples of unlawful employer and union conduct, as well as instruct employees how to contact the NLRB with questions or complaints. The complete text of the proposed employee rights notice and the proposed penalties for failing to post the notice are set forth in the Proposed Rule.  There is a 60 day period for public comment on the proposed rules.

For the labor professional, the NLRB's action is really quite remarkable.   It wants to require otherwise compliant employers to post notices informing employees of their right to unionize. This also suggests that future NLRB rulemakings are on the horizon. Indeed, the fact that law professor Charles Morris originally proposed the rule to the NLRB in a 1993 petition further supports this possibility. Readers of this blog may recall that Morris has also petitioned the NLRB asking that it issue an administrative rule requiring employers to bargain with unions that do not represent a majority of an employer’s employees.

It is unclear what awaits labor professionals if Professor Morris is influencing NLRB policy, but if the NLRB's proposal is any sign, employers should beware and remain watchful of any additional rulemaking activity.  Those employers and other interested parties who wish to comment on the regulations should note the applicable deadline for receipt of those comments.

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NLRB Acting General Counsel (AGC) Lafe Solomon is continuing his focus on remedies in unfair labor practice (ULP) cases involving union organizing campaigns.   On September 30, 2010, he issued a memorandum on Section 10(j) injunctions for discriminatory discharges during such campaigns.  Today, he released another memorandum (pdf), this one targeting remedies regional offices should seek when they issue complaints in ULP cases involving campaign activity. 

The most recent memorandum, in the AGC's words, demonstrates a commitment to "making the principle of employee free choice meaningful."  In contrast to his 10(j) memorandum, however, which only focused on employee discharges, the AGC has substantially broadened the scope of his effort to include other violations as well.  These violations include:

• threats of job loss;
• threats of plant closing;
• promises or grants of benefits;
• solicitation of grievances;
• interrogation;
• surveillance; and
• interfering with the ability to communicate between employees.

The memorandum released today notes that cases in which unlawful discharges are alleged often include the other violations listed above.  "These additional unfair labor practices also have a serious impact on employee free choice, as they inhibit employees from engaging in union activity and dry up channels of communication between employees."

To fully remedy these ULPs, the AGC's memorandum authorizes regional offices (those who prosecute ULP cases) to seek the following remedies:

• Notice reading.  Requiring a management official or NLRB agent to read the remedial notice.  In typical cases, the remedial notice must be posted on an employer's bulletin board or, sometimes, distributed electronically.
• Access to bulletin boards.  Regions "should. . .seek" this remedy when the ULP has had an adverse impact on employee/union communications.  The remedy would permit the union to place its campaign materials on the employer's bulletin boards.
• Access to employee names and addresses.  Typically, a union is only entitled to this information after it has filed a petition for an election with the NLRB.  The AGC's memorandum provides for expanded access to this information (both at an earlier stage and for a potentially longer period of time) as a remedy to alleged ULPs.

This development has a number of implications for the labor professional:

• First, it reminds employers of the significant legal liabilities that lurk beneath the surface of any union organizing effort.  Navigating those waters requires careful planning and execution.
• Second, with EFCA all but dead in Congress, traditional union organizing (i.e., filing petitions and holding secret ballot elections) is likely to increase.  Indeed, while not nearly as helpful to unions as EFCA's card check would have been, an increased emphasis on the remedies contained in the AGC's memorandum is certainly a helpful tailwind for union organizing. 
• Third, the three remedies noted above may be just the start.  In cases involving multiple unlawful employer speeches or where the employer is a "recidivist," showing a "proclivity to violate" the NLRA, the AGC tells the regional offices they "should" seek additional guidance on even more severe remedies, like union access to the workplace, "equal time and facilities" for unions to speak to employees about unionization, and union speeches to employees prior to an election. 

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Many commentators have noted the decline in unions' use of the NLRB's formal election process to organize new groups of employees.  A central tool that has arisen in its place is the neutrality and card check agreement.  In these agreements, an employer agrees that it will recognize and bargain with a union if the union can show that it represents a majority of the employer's employees, usually by way of signed authorization cards.  While not necessary, these agreements usually also require the employer to remain neutral on the question of whether employees should join a union.

An employer may be interested in signing a neutrality agreement for a number of reasons.  It may see advantages in avoiding a protracted battle with a union.  It may perceive advantages to unionization when it comes to entering new markets or selling to particular consumers.  What an employer doesn't know, however, is what its labor costs might look like with a unionized workforce.

In an opinion announced today, however, the NLRB took a step towards alleviating some of that uncertainty for an employer confronted with the decision of whether to sign a neutrality agreement.  In Dana Corporation, 356 N.L.R.B. No. 59 (Dec. 6, 2010), the employer and union agreed to a neutrality and card check agreement for one of the employer's auto parts plants.  The union already represented some employees at other plants that the employer operated.  The agreement also contained a disclaimer that the employer was not recognizing the union as the representative of a majority of its employees. 

The agreement, however, went beyond just the process by which the union could gain recognition.  Instead, it also contained substantive provisions that would "inform future bargaining" on particular topics.  For example, the agreement specified that any labor contract would (1) not weaken the employer's and union's understandings on containing health care costs, (2) have a minimum duration of four years, (3) recognize "flexible compensation," (4) allow for mandatory overtime when necessary, and (5) incorporate the employer's "idea program."  There were other provisions as well, including a limit on the employee's right to strike and an interest arbitration provision for the resolution of any disputes over the contents of the labor agreement.

The NLRB held, in a 2-1 decision, that the employer and union did not violate the NLRA by entering into the agreement.  The majority reasoned that the agreement disclaimed majority representation status and did not change the existing terms and conditions of employment of the employees.  The agreement was vague enough to still require, in the NLRB's view, "substantial" negotiations in order to conclude a labor agreement.  The majority also reasoned that there were important policy reasons related to stable labor relations to encourage the formation of agreements such as the one at issue.

The dissent viewed the majority's action as overruling a case decided decades ago by the NLRB.  It viewed the substantive provisions of the agreement as significantly limiting the parameters of bargaining over a future labor contract.  It limited employees' right to strike.  It dictated certain health care related terms.  It limited the duration of a contract to 4 - 5 years.  Thus, the employer and union violated the NLRA by negotiating a collective bargaining agreement prior to the union's demonstration of majority support.

There are three significant points for labor professionals with this decision:

• For those employers that may have business reasons for entering into a neutrality agreement, the decision provides those employers with the opportunity to more carefully predict what impact the unionized workforce will have on labor costs.
• How far an employer and union can go without violating the NLRA, however, is left for another day.  The majority refused to announce a "bright line" test, holding instead that each case will depend on the facts of the situation.
• For employers wishing to remain union free, the decision will be less welcome.  As the dissent recognized, the decision could "encourage the escalation of top-down organizing" where unions organize the employer first (e.g., through a "corporate campaign") and then organize the employees.

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In 2007, and again in 2008, Governor Strickland signed executive orders that significantly expanded the scope of unionization in Ohio.  The executive orders provided a legal framework for certain unions to organize independent home health care providers and home child care workers.  These are individuals who work for themselves, but obtain reimbursement from the State.  Governors in other states, like Illinois and Michigan, took similar actions in the 2000s as well.

As a result of the executive orders, the SEIU organized about 7,000 home health care workers.  The AFSCME union organized about 6,800 child care workers.  The labor contracts that the Strickland Administration subsequently negotiated with these two unions required all of the workers to pay union dues to the respective unions.  Those contracts expire in 2012.

This weekend, Governor-Elect Kasich indicated his intent to reverse the Strickland-era executive orders.  Not surprisingly, the statement drew strong rebuke from the two unions who represent the employees. 

For the labor professional in the public sector, Governor-Elect Kasich's statements suggest that change may be in the wings for the structure of labor relations in the public sector in Ohio.  Commentator Thomas Suddes writing in the Columbus Dispatch discusses what the future might hold for public sector unions in the coming four years.

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