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

Recently, Ohio's biennial "budget bill" was introduced.  Among many other provisions, Substitute House Bill 153, the technical name given to the budget bill, contains some significant changes to the state's prevailing wage law.  Some of the changes to the prevailing wage law that are proposed in the bill are (for ease of reference, line numbers in the bill where these changes are found are noted parenthetically):

• Increasing the "total overall project cost" threshold to $5 million, adjusted biennially for inflation (62897-62913).
• Setting a separate, and substantially lower, cost threshold for public improvement projects related to roads, streets, and the like (62914-62932).
• Providing that some public improvements that are neither constructed by a public authority or for the benefit of a public authority do not trigger prevailing wage requirements, even if the improvement receives certain funding from a public authority (62953-62957).
• Excluding public improvements undertaken by a state institution of higher education from the obligation to pay prevailing wage (63091-63093).
• Altering the enforcement mechanism of the statute (63205-63243).

In addition to these changes, the bill also deletes a provision requiring payment of prevailing wage on projects receiving certain economic development incentives (11108-11128).

For the labor professional, House Bill 153 is yet another public policy development to track as it makes its way through the legislative process.  If the bill passes in its present form, the number of projects to which the prevailing wage might apply will decline.  Indeed, the bill seems particularly focused on excluding from prevailing wage exposure "public/private partnership" projects that are often seen in the economic development arena.

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A supervisor gives a pro-union petition to her subordinates and asks them to sign it.  Not surprisingly, some of them do so.  The supervisor then remains actively involved in the organizing campaign.  She speaks at union meetings and wears union insignia.  In the secret ballot election the NLRB conducts, the union wins the majority of the votes cast.

Should the election result be set aside based on the supervisory employee's conduct?  Not according to a decision released yesterday by the NLRB.  In Terry Machine Co., 356 N.L.R.B. No. 120 (2011), the NLRB held (pdf) in a 2-1 decision that the solicitation of signatures on a union representation petition by seven different supervisors didn't warrant setting aside the election results.

The majority, applying a 2004 NLRB decision, reasoned that the employer's anti-union campaign "mitigated" the effect of the supervisors' activities.  In particular, the majority noted that the employer threatened to terminate the pro-union supervisors, and that the supervisors communicated that threat to employees.  Some of the supervisors, however, continued to campaign for the union even after the threat, without any repercussion.

Member Hayes disagreed with the majority's "mitigation" finding.  He noted that the dissemination of the threat to fire the supervisors was not done by the employer, but by the supervisors themselves.  Moreover, he did not believe that the antiunion campaign could mitigate the effect of pro-union supervisors soliciting support for the union and opposing that very campaign.

Another holding in the case is also significant.  The election that the employer challenged occurred in 1999.  The case, however, had a tortured procedural background, having previously been before the NLRB three different occasions.  Despite the passage of time, the majority certified the union as the representative for the employees in the bargaining unit.  Member Hayes dissented on this point as well, noting that court of appeals precedent drew into question the enforceability of any order requiring bargaining with the union in light of the substantial delay in the NLRB's handling of the case.

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Today, the Ohio House Commerce and Labor Committee considered amendments to Senate Bill 5.  According to a report in The Columbus Dispatch, some of the changes considered include:

• Giving public employees the right to refuse to pay "fair share" fees to unions.
• Making some changes to impasse resolution mechanisms, primarily by providing an option of a public referendum on a union contract that could not be paid for without a tax increase.
• Clarifying that safety forces can bargain for equipment.
• Permitting public employees to speak to public officials during contract negotiations.

This afternoon, the House committee voted 9-6 in favor of the legislation.  The bill will move next to the House. 

Opponents of the legislation have not offered any amendments to it, maintaining that the legislation is so bad that nothing can fix it.  Rather, opponents seem focused on a ballot initiative, perhaps as early as November 2011. 

Meanwhile, pollsters have been active, asking Ohioians about their views on the proposed legislation.  The results are not favorable for supporters of Senate Bill 5.

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One of the key assets of any company is its customer base.  Businesses spend a lot of money to build that base and the loyalty of that base to the company's goods or services.  Not surprisingly, businesses care about what their customers think about the company, and that includes the employees who deliver the goods or services the company provides.

Late last week, however, the NLRB ruled that those considerations take a back seat to employees' desires to speak out about a dispute with their employer.  In AT&T Connecticut, 356 N.L.R.B. No. 118 (2011), the NLRB ruled that an employer violated the law when it prohibited its service technicians, when visiting customer's homes, from wearing a t-shirt critical of the company. 

The NLRB described the shirt as a plain white t-shirt with "Inmate #" in "relatively small" letters the upper left front of the shirt.  On the back of the shirt, two sets of vertical stripes appeared with "Prisoner of AT$T" in between the stripes.  AT&T, concerned about the reaction of its customers to these shirts, prohibited service technicians from wearing them.

The NLRB found that the shirts were not reasonably likely to cause fear or alarm among the employer's customers.  The print was relatively small and the reference to "prisoner" was only half the size of the reference to "AT$T."  Moreover, the majority noted that the technicians appeared at customers' homes in response to appointments the customers made; called the customer before coming to the home; carried identification cards on their belts or wore them around their necks; and would have an AT&T truck "parked[ed] nearby."

In a dissenting opinion, Member Hayes came to a different conclusion.  He found that the employer's restriction was appropriate under the circumstances.  Customers would first see "Inmate #" on the t-shirts upon opening their doors.  The other print was on the back of the t-shirts.  There was no reference to a labor dispute anywhere on the shirt.  Finally, the employer banned the t-shirts at a time when, in the state where they were being worn, there had been a home invasion by two convicted felons resulting in the deaths of a mother and her two children.  Under these circumstances, Member Hayes believed the employer's prohibition on the t-shirts was permissible.

For the labor professional, the opinion serves as a reminder of the scope of an employee's rights under the NLRA.  Employees wearing union insignia will often be protected, and the employer will often find it difficult to impose limitations on those rights.

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Earlier this year, Acting General Counsel Lafe Solomon met with the Practice and Procedure Committee of the American Bar Association's Labor and Employment Law Section.  He answered questions the Committee collected from practitioners around the country.

Recently, the AGC issued a memorandum (pdf) to the NLRB's Regional Directors and others NLRB employees to share the questions that were posed and the answers that were provided.  The topics covered were extensive, and this post cannot comprehensively summarize all of them.  However, some of the more interesting highlights (with page number references to the memorandum) include:

• Data on the AGC's enforcement efforts outlined in earlier AGC memoranda on remedies (see pp. 1-2).
• Additional insights on the routine use of default language in all informal settlement agreements (see pp. 6-7).
• Clarification that the AGC is not currently considering changes in the scope of pre-arbitral deferral (see p. 10).
• Questions and answers about how the AGC intends to apply the NLRB's decision requiring electronic posting of NLRB notices (see pp. 12-13).
• Interesting data on representation case filings with the agency, which rose 10% between FY 2009 and FY 2010 (see p. 18).

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Does your union contract contain a provision that says the employer (and maybe even the union) will not discriminate against members of the bargaining unit?  If so, you need to be aware of a recent case from the United States Court of Appeals for the Tenth Circuit that explains the limits of such a clause.  In John Mathews v. Denver Newspaper Agency LLP, Case No. 09-1233 (March 16, 2011),  the Court held that an employee who asserts a violation of a union contract clause prohibiting discrimination can have two attempts to prove a discrimination claim. 

Mr. Mathews worked as a Unit Supervisor.  Despite the title of his position, a collective bargaining agreement regulated his terms and conditions of employment.  An employee whose work he oversaw complained to her union steward about inappropriate comments allegedly made by Mr. Mathews.  The newspaper began an investigation.  Approximately two weeks later, the newspaper demoted Mr. Mathews.

Mr. Mathews responded with a grievance claiming that the demotion violated the contractual provision prohibiting discrimination.  Specifically, he asserted that the newspaper demoted him because of his national origin and to retaliate against him for previous complaints.  Mr. Mathews advanced his grievance to an arbitration hearing.  The issue the arbitrator addressed was whether the demotion violated the contractual provisions prohibiting.  However, both sides presented their arguments by reference to the controlling law under Title VII.

The arbitrator ruled against Mr. Mathews, who subsequently filed a lawsuit, asserting statutory claims of discrimination.  The trial court dismissed the claim, noting (among other things) that by submitting his claims to the arbitrator, Mr. Mathews had waived his right to seek a judicial remedy.  Therefore, Mr. Mathews was precluded from relitigating his claims in court.

The court of appeals reversed.  Interpreting United States Supreme Court precedent, the court held that the language of the union contract in this case did not waive Mr. Mathews' right to a judicial determination of his claims.  Rather, the contract created only contractual rights and the parties only submitted contractual claims in the arbitration.  The court noted, for example, that the issue presented to the arbitrator was phrased in terms of whether the newspaper violated the contract.  There was no language in the union contract that required an employee to submit statutory claims to an arbitrator and the court found no evidence that such claims were actually submitted. 

The most important point for the labor professional in a unionized workplace is the importance of the language in the labor agreement.  If the contract had required statutory claims to be submitted to the arbitration forum, the outcome would likely have been different.  If an employer wants to limit the possibility of a "do over" in cases like Mr. Mathews', but only has general anti-discrimination language currently, then it will be necessary to seek different language in your next labor negotiation.  The general language will likely not be sufficient.

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Employers are often faced with employees who complain about issues with their employment.  When employees engage in "protected, concerted activity," however, the NLRA prohibits employers from taking disciplinary action against them.  A recent case from the NLRB is a good reminder of this rule.  In Wyndham Resort Development Corp., 356 N.L.R.B. No. 104 (March 2, 2011), the NLRB held, in a 2-1 decision, that an employer unlawfully disciplined an employee for engaging in protected, concerted activity.  The circumstances of the case are particularly noteworthy for the labor relations professional.

The employer implemented a rule for salesmen requiring that shirts be tucked in.  An employee, learning of this policy upon returning from a vacation, confronted management about how the rule was announced in front of a group of his co-workers.  During this confrontation, another employee expressed concerns about the substance of the rule, objecting to the requirement that he tuck in his shirt.  That employee indicated, among other things, that he "didn't sign up for this crap".  Neither of these employees had talked to the other in advance of their respective decisions to raise this complaint with management.

Ultimately, a manager issued a written warning to the first employee.  The manager noted the employee's argumentative and aggravated tone during the confrontation.  The manager also noted in the warning that the employee "incited" another employee to join in.

The NLRB majority held that the employer's written warning was unlawful.  The employee was engaged in concerted activity because he made references to "we" and "us" when opposing the employer's policy.  The employee also knew that some of his coworkers enjoyed wearing shirts untucked, and thus he could "reasonably expect" those employees to disagree with the rule.  The fact that another employee joined in also demonstrated concerted activity.  Indeed, given the employer's reference to this fact in the written warning, the NLRB concluded that the employer disciplined the employee precisely because he chose a group forum that was likely to induce group action. 

The NLRB majority found it irrelevant that the employees had not agreed or consulted one another in advance of the employee meeting to protest the work rule together.  It was enough, said the NLRB, that the employee was attempting to initiate or induce group action.

Member Hayes disagreed with the majority opinion.  He noted that the employee acted in a group setting, but that there was no evidence that he did so on behalf of coworkers or to induce group action.  Member Hayes criticized the majority for essentially holding that an employee who voices a complaint in a group setting is thereby engaged in concerted activity.

For the labor professional, Wyndham Resort is significant for at least two reasons:

• It demonstrates the breadth of protection the current NLRB will afford employees engaged in "protected, concerted activity."
• It reminds employers of the need for effective mechanisms (e.g., "open door" policies) to receive and address employee complaints. 

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Senate Bill 5, the legislation that would substantially reform the public employee collective bargaining system in Ohio, has passed the Ohio Senate.  It now moves on to the Ohio House of Representatives for consideration.

The bill that passed in the Senate was significantly different from the bill originally introduced by its sponsor, Senator Shannon Jones (R).  Among other changes, the amended bill that passed:

• Restores collective bargaining rights for public employees of the state, state-supported colleges and universities, and any agency, commission, authority, or board of the state.
• Restores Ohio's Office of Collective Bargaining.
• Limits the ability of public employers to agree to any contract that requires public employees to pay less than 15% (rather than 20% as in the bill as introduced) of the cost of health insurance.
• Changes the definition of "supervisor" as it relates to faculty members at a state college or university.
• Alters, from the bill as introduced and from current law, the procedures that come into play upon an impasse in negotiations.
• Prohibits strikes for all public employees, not just certain groups of public employees, as was the case under both current law and the bill as introduced.
• Expands the list of a public employer's management rights to include (among other things) the right to transfer or subcontract work.
• Requires a public employer to deduct union dues and fees, but only so long as the union has filed and maintained a report detailing its expenditures, and also imposes a suspension of dues payments as a penalty for a union that engages in a prohibited strike or similar conduct.
• Prohibits an hourly overtime premium rate that exceeds the rate required by the FLSA.
• Imposes limits on paid vacation, holidays, and personal days.

These are just a few examples of the changes contained in the bill, which passed by a slim 17-16 margin.  According to press reports, the Ohio House plans an aggressive hearing schedule and ultimately a vote in the next few weeks.  Governor Kasich applauded (pdf) the Senate's action in passing the the bill.  For their part, opponents are talking about a possible ballot referendum on the bill, taking their case directly to the voters.

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By Nelson Cary and Angela Rapp

On February 24, 2011, the Ohio School Facilities Commission (OSFC) voted to no longer require union-scale wages on job sites in the hopes of saving money on school construction.  The OSFC's action last Thursday returns it to a pre-Strickland administration era when the rules did not allow local districts to require prevailing wages or project labor agreements.

After former Governor Strickland took office in January 2007, the OSFC adopted Resolutions 07-16 and 07-98, which set forth Model Responsible Bidder Requirements and granted school districts authority to determine additional standards.  With the change in governors, the OSFC has reverted back to the policies it held for many years under Republican governors by adopting Resolution 11-16, which rescinded Resolutions 07-16 and 07-98.  The OSFC views Resolution 11-16 as one to encourage free and open competition for all qualified firms to bid.

Resolution 11-16 (pdf) effectively requires the rejection of bids that include prevailing wage requirements or contain provisions commonly found in project labor agreements.  It does so by outlining certain bidding conditions that can no longer be considered.  Resolution 11-16 applies to all contracts that require OSFC approval that have not been advertised for bid as of February 24, 2011.  For any agreements previously approved under Resolution 07-98, OSFC retains discretion to review their terms and determine the applicability of OSFC's new policies.

The OSFC also voted for Richard Hickman, Jr., to fill the Executive Director vacancy, a position he held four years ago. Hickman replaces former Executive Director Richard Murray, who was alleged to have favored (pdf) union contractors over non-union contractors by helping them secure school construction contracts.

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By Nelson Cary and Samantha Stilp

The comment period for the National Labor Relations Board proposed rule requiring employers to post notice informing workers of their right to unionize officially ended last week.  Nearly 6,500 comments reveal strong opposition to the rule from all types of employers.

Those filing comments opposing the rule focused on three main issues. First, the comments questioned the NLRB’s authority to make such a rule. Second, commenters expressed concern that the text of the proposed notice was one-sided, containing information about rights of employees to join unions, but omitting information regarding employees’ rights to decertify a union, object to certain union dues/fees, and seek relief against unions for lack of fair representation. Finally, commenters criticized the potential penalties for violation of the rule.  All of the comments to the proposed rule are available online.

In addition to these general concerns, retailers and manufacturers, as well as organizations representing each, expressed frustration with the electronic notice requirement. Comments concerning the electronic notice requirement urged that such notice would place significant burdens on employers and create a “troubling precedent” of using employer email systems to provide union information to employees.

If promulgated, the notice requirement rule would be problematic for employers on many grounds. For now, employers are encouraged to be watchful for the NLRB’s next step with regard to the proposed rule. The proactive labor professional may also want to begin planning for the possibility that the rule will be adopted, thus requiring the posting of the proposed notice.  It is uncertain when the NLRB may take additional action on the proposed rule. 

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