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

Think that just because an employee has the title "supervisor" and is involved in the disciplinary process that the employee will necessarily be a supervisor under the NLRA?  Think again. 

In a recent decision, the NLRB examined the duties of an employee with the title "field supervisor."  This employee was the first level of leadership for hourly, non-supervisory employees.  The field supervisor monitored the productivity of those employees, examined their work, and inspected their vehicles.  The field supervisor could give verbal warnings to those employees for performance or attendance issues.  The field supervisor could also initiate what the employer called an "employee consultation form" (ECF), recommending to higher management that more significant disciplinary action be taken.  Following the referral of the ECF to higher management, multiple levels of management, along with a human resources manager, would review the ECF before accepting or rejecting it.  The employer established that higher management rarely rejected an ECF from a field supervisor.

In DirectTV, 357 N.L.R.B. No. 149 (Dec. 22, 2011) (pdf), the NLRB held in a 2-1 decision that the employer failed to prove that the field supervisor was a "supervisor" under the NLRA.  To be a supervisor under the NLRA, an employee must possess certain authority with respect to other employees.  One such authority is the power to discipline another employee, or to effectively recommend that disciplinary action be taken.

The NLRB noted that "effectively recommend" means that the recommended action is taken without an independent investigation by superiors, and not simply that the recommendation is ultimately followed.  The NLRB then found that the employer proved merely that management ultimately followed the recommendation.  According to the majority, the employer didn't prove what weight higher management attached to the field supervisor's recommendation.  It also found that the review by other levels of management constituted "independent investigation" by the superiors.  Finally, the majority found fault with the employer's proof because it didn't demonstrate what impact the ECFs had on an employee's job status, future tenure or discipline.

Member Hayes (R) dissented.  He found that the record clearly established that the field supervisor had the independent, discretionary authority to discipline other employees.  The subsequent review by higher levels of management was not unique and to be expected to "assure procedural compliance with myriad Federal and State employment law regulations."  He also noted that the record contained evidence that ECF's seeking discipline up to and including termination have been approved and implemented.  Accordingly, Member Hayes would have held that the field supervisors are supervisors under the NLRA.

For the labor professional, the NLRB's decision is an important reminder of four points:

• Titles don't matter; duties do.  Regardless of what title an employer bestows upon an employee, it is important to match the duties to that title.
• "Effectively recommend" is not easily proved.  The NLRB will clearly look closely at how the alleged supervisor interacts with other members of management and what authority the person actually exercises.
• The burden of proving supervisory status is on the party asserting it.  If an employer anticipates taking the position that an employee is a supervisor, then the employer should be prepared with documentary evidence to prove that the employee exercises the statutorily required authority.
• Knowing which employees are supervisors is critical.  In this case, the evidence suggested that the field supervisors were involved in prounion activity.  The union won the election by only a five vote margin.  Because the field supervisors were not "supervisors" under the NLRA, their prounion activities didn't require a second election.

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By Nelson Cary and Micah Dawson

Earlier today, the NLRB formally published their new election rules in the Federal Register.  Chairman Pearce (D) and Member Becker (D), whose term ends next week, voted in support of the new rule. Member Hayes (R) withheld his vote. Member Hayes can vote against finalizing the rule and publish a statement of dissent any time before the rule takes effect on April 30, 2012.

As expected, the new rule makes significant changes to union election procedures, including:

• Empowering the hearing officer to limit evidence produced at the initial hearing to only that necessary to determine whether a question concerning representation exists;
• Eliminating the automatic right to file briefs with the regional director after the initial hearing;
• Eliminating a party's right to appeal the regional director's determinations to the NLRB prior to the election, and providing for only a single appeal, after the election, and then only over issues that the election hasn't rendered moot;
• Eliminating language in the NLRB's regulations providing that elections are typically not scheduled for a date sooner than 25 days after the election petition has been filed;
• Clarifying the standard for seeking special permission to appeal to the NLRB from a regional director's decision; and
• Making NLRB review of the regional director's decisions discretionary, rather than mandatory.

The rule, which has increasingly been referred to as the “ambush election” rule by those opposed to it, significantly limits employers’ legal right to object to the petitioned-for unit prior to a union election.  By shortening the amount of time between petition and election, it also curtails employers' ability to communicate with workers during the union election process.  With less ability to communicate, the rule limits the time during which an employee is certain to hear both sides of the story:  both the case for and the case against union representation.   

Even before the NLRB announced that it would publish this final rule, the U.S. Chamber of Commerce sought to nullify it.  On December 20, 2011, the Chamber filed a federal lawsuit challenging the new rule. The lawsuit attacks the validity of the new rule, stating that it violates Board procedure and denies employers' free speech rights. In addition to asking the court to vacate the rule, the Chamber’s lawsuit (pdf) seeks a preliminary injunction barring the rule from being enforced.

For the labor professional, the final rule is a major development.  Employers that are currently non-union should carefully consider the implications of the rule in light of their individualized circumstances.  Those employers may want to revisit their strategies given this development. 

The Chamber's lawsuit adds an additional level of complexity for the labor professional.  After business groups filed court challenges against the NLRB's notice posting rule, the NLRB delayed the effective date of that rule.  It is uncertain whether a similar delay will be announced here, given that the NLRB is at risk of losing one of its three members, and thus being unable to act.

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The NLRB headed into a public vote today over a proposed rule on election procedures summarized yesterday on this blog.  It did so without assurances that one of its members, Brian Hayes (R), would be present. While tensions were high, Member Hayes did attend the meeting and the NLRB voted along party lines, 2-1, to move forward with the slimmed down, but still controversial, election rule proposal. As the lone dissent, Member Hayes again made it clear that he opposed the short time frame for elections under the proposal. Despite that opposition, the final language of the rule will now be drafted for another NLRB vote before it goes into effect. 

Although there was information suggesting that Member Hayes was seriously considering resigning in an effort to eliminate the NLRB’s power to move forward on the proposal, he has apparently decided against resignation. Member Hayes explained at the meeting that “it is not my nature to be obstructionist.” Further, he believed that “resignation would cause the very same harm and collateral damage to the reputation of this agency” as the rule changes the majority voted to advance.

With Hayes staying put, labor professionals should stay alert for the final language of the rule, as it is certain to have a impact on employer policies.  Nor should labor professionals expect any legislative change from Congress that would trump the administrative rule.  Although the U.S. House voted today to approve legislation that would do so, the prospects of that legislation appear dim in the Senate.

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A business that purchases or merges with a company whose employees are represented by a union must navigate a labor law minefield.  The NLRB recently planted another mine in that field. In UGL-UNICCO Service Co., 357 N.L.R.B. No. 76 (2011) (3-1), the NLRB restored a modified version of the "successor bar" doctrine.  If the "successor bar" applies, the union that represented the seller's employees is entitled to a reasonable period of time in which its majority status cannot be challenged.  In addition, employers may not unilaterally withdraw recognition from the union based on a claimed loss of majority support.  This is the third of three major decisions that were included in the flurry of activity at the end of Chairman Liebman's term last month.

The NLRB's ruling marks another swing of the pendulum in an area that has seen substantial doctrinal shifts by the NLRB over the years.  This time, the NLRB not only reversed a 2002 ruling, however, but went further to define a "reasonable period" in certain situations.  The applicable time period for the bar will now depend upon the buyer's actions with respect to terms and conditions of employment.  If the buyer expressly adopts the existing terms and conditions of employment as the starting point for bargaining, without making unilateral changes, the "reasonable period" will be six months.  If the buyer exercises its right to set initial terms and conditions of employment (a decision that must navigate its own legal minefield), the "reasonable period" will be a minimum of six months and a maximum of one year.  In both of these situations, the period is measured from the date of the first bargaining meeting between the union and the employer.

Finally, the NLRB majority also modified the time-period for the "contract bar" in the successorship context. The contract bar is the period of time that a union is protected from an effort to test its majority status after it has negotiated a labor agreement with an employer.  The NLRB held that the contract-bar period applicable to election petitions filed by employees or by rival unions will be a maximum of 2 years, rather than the current 3-year maximum, but only in certain situations.

In a lone dissenting opinion, Member Hayes (R) argued that the majority’s decision was inconsistent with, and even an attack on, U.S. Supreme Court precedent.  He noted that the majority's decision elevates protection of incumbent unions over employee free choice.  The majority changed the law, in Member Hayes' view, "to service the ideological goal of insulating union representation from challenge whenever possible." 

For the labor professional involved in a merger or purchase situation, the NLRB's decision further complicates an already complicated area of the law.  Careful planning by the buyer early in the process will be necessary to ensure that the buyer's legal obligations are satisfied.

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Chairman Liebman's third term expired at midnight on August 27, 2011.  Her departure brings the NLRB down to three members:  Pearce (D), Becker (D), and Hayes (R).  As Chairman Liebman departed, Member Pearce was designated the new Chairman of the NLRB.  The press release from the NLRB notes that Chairman Liebman was the third longest serving member of the NLRB in the agency's 73 year history.

In a flurry of activity at the end of her term, the NLRB published a new rule requiring that employers post a notice of employee rights under the NLRA, issued a decision reversing a 20-year old precedent on bargaining units in non-acute health care settings (like nursing homes), and overturned two decisions from the 2000s (issued by the NLRB appointed by President Bush).  One of the overturned decisions permitted employees the opportunity to vote in a NLRB-conducted, secret ballot election after an employer voluntarily recognized a union, for example through a card check procedure.  Chairman Liebman was in the majority on each of these decisions.  Watch this blog for further summaries of each of these decisions, made public today.

For her part, Chairman Liebman gave an interview to the New York Times last week.  According to the Times article, in the interview she defended the NLRB from attacks by critics, saying, among other things:  "The perception of this agency as doing radical things is mystifying to me."  She described the rhetoric about the NLRB as "overheated."

For labor professionals, the most significant part of this development is that it brings the NLRB to just three members.  Member Becker's recess appointment will expire near the end of 2011.  If President Obama is unable to name another recess appointment, and the Senate declines to act on any then-pending nominations, the NLRB will drop to just two members before 2012 begins.  The Supreme Court held just over 14 months ago that the NLRB may not issue decisions with just two members. Recognizing the potential procedural obstacle to further NLRB decision-making, some are already calling on Member Hayes (R) to resign in order to hasten the arrival of a two-member NLRB.

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It is only Wednesday, and yet the week has still been a tough one for employers concerned about union-related issues. On Monday, the U.S. Department of Labor proposed a new interpretation regarding persuader activity. Then yesterday, the NLRB announced a proposed rule that will significantly change, and likely accelerate, the union election process. The official publication of the NLRB’s proposal will take place today.

The Notice of Proposed Rulemaking (“Notice”) maintains that “the proposed amendments would remove unnecessary barriers to the fair and expeditious resolution of questions concerning representation.” Through the proposed amendments, the NLRB intends to fix perceived flaws in the NLRB’s current election procedures that, according to Chairman Liebman (D), build in unnecessary delays, encourage wasteful litigation, reflect old-fashioned communication technologies, and allow haphazard case-processing. 

Member Hayes (R) vigorously dissented (pdf) to the issuance of the Notice. Characterizing the proposed amendments as championing “a belief that employers should have little or no involvement in the resolution of questions concerning representation,” Hayes warned that the proposed changes would amount to a union-friendly “quickie election” option in which elections would be held in 10 to 21 days after the petition’s filing. 

The Notice presently contains no specific deadline by which a union election must be held following the filing of an election petition. Yet, any shortened timeframe between a petition and an election may stymie employer efforts to convey the company’s perspective to employees. In contrast, the union has likely communicated with employees for some period of time before an election petition is even filed. This truncated employer messaging timeframe concerned Hayes, who wrote, “[m]ake no mistake, the principal purpose for this radical manipulation of our election process is to minimize, or rather, to effectively eviscerate an employer’s legitimate opportunity to express its views about collective bargaining.” 

According to an NLRB fact sheet, if adopted the proposed amendments would also:

·         Standardize and accelerate timeframes for parties to resolve or litigate issues before and after elections.

·         Require parties to identify issues and describe evidence soon after an election petition is filed, or forfeit the right to raise those issues later.

·         Defer litigation of most voter eligibility issues until after the election.

·         Require employers to provide a final voter list in electronic form much earlier than under current law, and require that list to include voters’ telephone numbers and email addresses when available.

·         Consolidate all election-related appeals to the NLRB into a single post-election appeals process.

·         Make NLRB review of post-election decisions discretionary rather than mandatory.

The NLRB’s proposed process changes could significantly impact an employer’s approach to a union election. Some of the changes and their effect, like the new eligibility list requirements, are straightforward. The impact of other changes may not be as immediately obvious. For example, deferring certain voter eligibility questions until after an election could introduce substantial uncertainty during the campaign process.

Finally, although the proposed regulations do not implement the precise types of changes EFCA would have brought, they clearly are designed to speed up the election process. Like EFCA’s card check, a quicker election process favors unions over employers. Thus, labor professionals will want to carefully review all of the proposed changes to determine how each may impact their organization’s own, unique circumstances. If an employer or industry/trade association wants to provide comments on the rules, they may do so at www.regulations.gov for the next 60 days.

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In non-right to work states, an employer and a union may lawfully agree to include a "union security" provision in their labor agreement.  This clause requires all employees to become a member of the union.  If an employee refuses to join the union, the contract typically requires the employer to terminate that employee.

Many years ago, however, the U.S. Supreme Court, in the Beck decision, ruled that the "membership" that may be required under the union security clause is simply the "financial core" of union membership:  paying money to the union to provide representation of the employee in their employment relationship with the employer.  An employee didn't have to pay for other activities of the union that were not related to this representational function.  The practical effect of this objection right for the employee, therefore, is to reduce the cost of union dues, with a corresponding reduction in dues income to the union.

To exercise the right to avoid "full" membership in a union, an employee must object.  Many unions have developed procedures to handle these objectors.  These procedures can sometimes require objectors to renew their objections on a periodic basis, such as annually.

Recently, the NLRB decided International Union, United Automobile, Aerospace & Agricultural Implement Workers of Am. Local Union # 376 (Colt's Manufacturing Co.), 356 N.L.R.B. No. 164 (May 27, 2011).  At issue was a union's procedure for objectors which required that the employee renew their objection to full union membership every 12 months.  The UAW's procedure provided notice of this right to object in a bimonthly magazine.  If an objection was received, the UAW would acknowledge receipt with a letter, which told employees their objection would expire in one year, but that they could renew the objection during a 30-day window period prior to the one year mark.  The union also sent a reminder letter to the employee 15 days before the one year period expired.  If they failed to renew, the employee would automatically begin paying full dues.  But, the employee could thereafter file an objection, which would again be honored for one year.

The NLRB, in a 2-1 decision, held that this procedure was permissible.  Analyzing the facts under a duty of fair representation standard, the NLRB found that the burden on an objecting employee's rights was minor.  First, the NLRB noted that the union sent out a number of letters to the employee that highlighted the one year time limit and the need to renew the objection.  Second, although there was a 30-day window period, if an objection was received outside of that period, it was still given effect for a full twelve months. 

Member Hayes, again writing a lone dissent, came to a different conclusion.  He relied upon three points:

• The burden on the employee was substantial as it imposed an affirmative obligation to renew an objection at the risk of forfeiting, even for a short time, the employee's legal right to refrain from subsidizing non-representational activity.
• The requirement was discriminatory, and hence a violation of the union's duty of fair representation, because the annual renewal requirement was imposed only on those employees who want to refrain from full membership; there was no annual renewal obligation for those joining the union.
• The annual renewal obligation was a form of coercive interrogation of those employees who objected to the payment of full union dues.

The NLRB's decision will primarily interest those labor professionals working in a unionized environment.  What it means is that employees in the bargaining unit who do not want to pay for the union's activities that are not related to representation will need to make even more of an effort to maintain that status.  As the facts of Colt's Manufacturing itself suggest, it is questionable whether employees will do so.  The two employees who filed charges against the UAW both wanted to remain objectors for a long term.  One wanted to remain an objector for three years and the other "until the UAW is decertified."  After going through the UAW's process, however, there was no evidence presented that either employee continued to object.

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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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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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