1283811-protests-1483480044-672-640x480Last week workers across the United States participated in a national protest aimed at President Trump’s immigration policies. Organized by advocacy groups and promoted largely through social media, “A Day Without Immigrants” involved an organized effort to urge workers to stay home in protest of the new administration’s immigration policies and actions, including recent enforcement raids, the proposed border wall, and the high-profile Executive Order on immigration and refugees. Employers’ reactions have ranged from closing their businesses in support of the protests to terminating employees for not coming to work.

This likely is not the end of such protests. On March 8, organizers of last month’s Women’s March on Washington plan to hold “A Day Without a Woman” protest, asking women to stay home from work in support of various issues that impact women. Other less publicized protests by different groups are also planned.

Impacted employers that seek to enforce their attendance rules and other workplace policies must carefully consider potential legal issues when reacting to employees who miss work in support of these protests. For example, the National Labor Relations Act (“NLRA”) protects both unionized and non-unionized workers who engage in protected concerted activity. Typically, this involves two or more workers acting together to improve or protest various terms and conditions of their employment, including protests related to pay, safety, hours of work, and other workplace issues. The discipline or discharge of employees who engage in protected concerted activity can result in charges of unfair labor practices before the National Labor Relations Board and potential liability. However, employee actions or protests that are purely political in nature, with no real connection to the workplace, are unlikely to qualify for protection under the NLRA.

The true objectives behind workers’ absences in supporting these causes can be unclear. The upcoming “A Day Without a Woman” protest identifies a number of diverse concerns, some of which arguably could relate to workplace issues, and some of which clearly do not. The organizers’ website poses the following questions in asking supporters to withhold their labor on March 8:

  1. Do businesses support our communities, or do they drain our communities?
  2. Do they strive for gender equity or do they support the policies and leaders that perpetuate oppression?
  3. Do they align with a sustainable environment or do they profit off destruction and steal the futures of our children?

Employers who choose to discipline or terminate employees who elect to miss work as part of these protests need to consider, on a case-by-case basis, whether an employee’s actions qualify as a protected protest related to workplace conditions, particularly when they can be linked to their own workplace, or are a more generalized expression of support for a political cause. Employees who explicitly tie their absences to issues in the workplace are far more likely to be protected under the NLRA.

Employers also must consider the potential applicability of both state and federal anti-discrimination laws, like Title VII, when reacting to employee absences. Both the “A Day Without Immigrants” and “A Day Without a Woman” protests potentially implicate protected classifications under the anti-discrimination laws – e.g., national origin and gender. Employers that choose to pursue discipline or termination may potentially face allegations of discrimination, either based upon assertions that the employer harbored animus towards a particular protected group (and its causes), and/or that the employer selectively enforced its policies to the detriment of the protected group. Employers should base any disciplinary or discharge actions on previously established and promulgated workplace policies, including attendance rules and no-call/no-show policies. Employers also should ensure that they have acted consistently with respect to past employee absences (like the parade in Cleveland after the Warriors blew a 3-1 lead in the 2016 NBA Finals). A prior, consistent history of discipline or discharge in similar situations will help protect against allegations of discrimination.

President Donald Trump has nominated Tenth Circuit Court of Appeals Judge Neil Gorsuch to fill the U.S. Supreme Court vacancy caused by the death of Justice Antonin Scalia nearly one year ago. Known for his classical constructionist approach, Gorsuch is expected to restore the ideological balance that existed before Justice Scalia’s passing, with four conservatives, four liberals and Justice Anthony Kennedy (for whom Judge Gorsuch worked as a law clerk) serving as a swing vote.

If confirmed, Judge Gorsuch’s presence on the High Court will invariably impact the judicial landscape of labor and employment law. More than three dozen petitions are currently pending before the Court, seeking interpretation of laws such as the Fair Labor Standards Act (FLSA), the Employee Retirement Income Security Act (ERISA), Title VII of the 1964 Civil Rights Act (Title VII), the NLRA, the ADA and others.

Here are a few issues to watch:

Agency Fees

On March 29, 2016, the Supreme Court issued a 4-4 opinion in Friedrichs v. California Teachers Association, in which the Court summarily upheld the Ninth Circuit Court of Appeals’ decision allowing public sector unions to tax employees who decline union membership with “agency” or “fair share” fees similar to the cost of union dues. Justice Scalia, who engaged in lively questioning during oral argument in this case but died before the opinion was issued, was expected to cast the fifth vote in favor of the employees, who argued that the agency fees violated their First Amendment right to freedom of speech and association. But with Scalia’s absence, the Court was deadlocked. 

The Friedrichs case was expected to have critical implications on the continued viability of public sector unions. While the plaintiff’s petition for rehearing has been denied, more cases like this are bubbling up through the courts. Changes also have been made through legislative action, with “right to work” laws having been enacted in 27 states and Guam. Under the right to work laws, employees in union shops may maintain employment without having to pay union dues or other fees.

Arbitration Agreements and Class Wide Waivers of NLRB Claims

After several requests, the Supreme Court has agreed to review the ruling in D.R. Horton, Inc., 357 NLRB No. 184 (2012), in which a 3-2 majority of the National Labor Relations Board (NLRB) found that class action waivers in arbitration agreements violate Section 7 of the National Labor Relations Act. On January 13, 2017, the Supreme Court granted certiorari in three cases involving the validity of the D.R. Horton rule. One case, NLRB v. Murphy Oil USA, Inc., arises out of a Board decision finding that an employer had engaged in an unfair labor practice by entering into arbitration agreements with its employees, and the other two, Epic Systems Corp. v. Lewis and Ernst & Young LLP v. Morris, are private-party disputes in which employees invoked D.R. Horton to challenge their arbitration agreements.

The Supreme Court has historically favored arbitration agreements in other settings, and these concepts have been extended to the employment setting. With certain delineated exceptions, employers are generally able to implement arbitration agreements with class wide waivers to mitigate their litigation risk.

Now that the D.R. Horton issue has been accepted for review, Judge Gorsuch’s confirmation may provide employers with hope that the Court will extend the FAA’s footprint, honoring arbitration agreements in the union setting.

Joint Employers

Another recent NLRB ruling set for review this year is the board’s August 2015 decision in Browning-Ferris Industries of California, Inc., in which the Board found that a California waste management company (Browning-Ferris) jointly employed its staffing agency workers. The decision effectively rewrote the NLRB’s test for deciding whether two affiliated companies are joint employers that share bargaining responsibilities when workers organize and legal liability when they file suit. Before the decision, the joint employer standard rested on a business having “direct and immediate” control over terms and conditions of employment. The Browning-Ferris Board revised the standard to include “indirect control,” or even the “ability to exert” such control. When Browning-Ferris thereafter refused to recognize and bargain with the newly elected union, an unfair labor practice charge was filed, and the Board found another violation of the Act.

The Browning-Ferris cases are part of a growing body of litigation over joint employer liability that is anticipated to take a significant toll on employers in coming years. Employees have sought to apply the new joint employer standard outside of the NLRA, including in cases involving alleged violations of OSHA, the FLSA, the FMLA and other statutes.

The Browning-Ferris, currently on review before the D.C Circuit Court of Appeals, warrants close monitoring. Judge Gorsuch’s confirmation would restore hope that employers will regain some clarity into the now amorphous and overly expansive definition of joint employer liability.

Discrimination Based Upon Sexual Orientation

A final issue poised for review is whether Title VII bars employers from discriminating against employees because of their sexual orientation. Courts have long held that it does not. However, the Seventh Circuit may go against the status quo following a recent en banc rehearing of Hively v. Ivy Tech Community College. In that case, the plaintiff-employee claimed that the employer violated Title VII by failing to award her a full time position because of her sexual orientation. The issue is squarely one of statutory construction, and the en banc court has been tasked with determining whether Title VII can be interpreted as recognizing a discrimination claim based upon sexual orientation as a sub-segment of prohibited gender bias. During the en banc hearing, the Court challenged the notion of strict construction, pointing to other acts, such as the Sherman Act, that are interpreted far differently now than when they first were enacted. If the Seventh Circuit rules in favor of the employee, the resulting split in circuits may signify a need for High Court intervention, provided the legislature doesn’t get there first.

Conclusion

Judge Gorsuch has a reputation as someone who would follow the general judicial philosophy of Justice Scalia, but without some of the more acerbic oral argument commentary for which Justice Scalia was known. For an enlightening insight into Judge Gorsuch’s personal views on Justice Scalia and his legacy, this 2016 Canary Lectureship article by Judge Gorsuch is well worth reading.

Assuming no surprises, it is likely that Judge Gorsuch will be confirmed over strenuous Democratic opposition and will impact the Court for many years.

On August 10, 2016, the Securities and Exchange Commission issued a cease and desist order against BlueLinx Holdings, Inc. that further demonstrates the scrutiny of various federal agencies with respect to severance agreements.

In BlueLinx, the SEC found a provision in a severance agreement that restricted employees from providing information to the SEC without company approval. This finding had a chilling effect on employees reporting suspected fraudulent activity. Such “whistleblowing” is specifically permitted and encouraged under the Dodd-Frank Act, which even offers financial incentives to employees to do so. While the severance agreement in issue did allow severed employees to file a charge with the SEC, it did not allow them to provide information to the SEC without company approval.

The SEC fined BlueLinx $265,000, and also ordered the company to modify its severance agreements to add language that advised employees they were not limited in their ability to file a charge or complaint with the SEC. The SEC did not stop there, however, as it also stated that BlueLinx must advise employees they were not limited in their ability to file a charge or complaint with the Equal Employment Opportunity Commission, the National Labor Relations Board, the Occupational Safety and Health Administration, or any other federal, state or local agency or commission. Additionally, the SEC stated that the severance agreements must inform employees that they were not limited in their ability to communicate with any governmental agency, nor from participating in an investigation or action by such agencies, or from receiving any monies for providing information (i.e., the Dodd-Frank whistleblowing reward).

This last provision is particularly troubling, as the nature of the release is that the employee gives up a claim for potential future monetary recovery in exchange for a current payment. Almost every current, well-drafted release informs an employee that, although he or she may provide information for and assist in government investigations, there is no longer any right to share in monetary recoveries.

This decision parallels some recent decisions and guidance from the U.S. Equal Employment Opportunity Commission and the National Labor Relations Board wherein the agencies have scrutinized severance agreements and found certain language to have a chilling effect on the exercise of statutory rights, and it highlights the need for employers to review carefully the language that is included in severance and separation agreements.

Employers in union settings know that they generally cannot make changes to their employees’ wages, hours and other terms and conditions of employment without first negotiating to impasse with the union. The exception to this rule has historically been that the employers could make changes, as long as they could show that their labor contract had a management rights clause that allowed certain changes to be made without bargaining. A recent decision from the National Labor Relations Board, however, will make it more difficult for employers to show that a management rights clause actually allows these types of changes to be made without bargaining.

The NLRB’s recent decision (Graymont, PA, Inc. and Local Lodge D92, 364 NLRB No. 37) involved a situation that is common in unionized workplaces. The employer and the union had a collective bargaining agreement in place with a management rights clause which provided that the employer:

[R]etains the sole and exclusive rights to manage; to direct its employees; . . . to evaluate performance, . . . to discipline and discharge for just cause, to adopt and enforce rules and regulations and policies and procedures; [and] to set and establish standards of performance for employees…

The employer relied on this clause to announce changes to the work rules and the attendance and progressive discipline policies. The union objected to this move and requested a meeting with the employer. The union also requested that the employer provide information about the changes. The employer met with the union, but took the position that it was not required to bargain over the changes (due to the management rights clause). The employer also took the position that it was not required to respond in any way to the request for information. After a single meeting with the union, the employer implemented the revised policies.

Click here to read the full client alert.

maxresdefaultAlthough the Republican National Convention is now behind us in Cleveland, we still have several months of campaigning to endure prior to the presidential election. During this time of year, the issue of expressing political beliefs in the workplace is especially poignant.

In the midst of all of this political activity, employers may ask—how much political activity must I allow or tolerate in the workplace? When regulating employees’ political speech and expression in the workplace, there are several laws that private-sector employers need to remember.

U.S. Constitution:  Contrary to popular belief, the First Amendment does not permit free speech everywhere. In fact, it protects only against attempts by the government to limit speech and expression. Although private-sector employers cannot violate the First Amendment by restricting political speech or expression in the workplace, they can run afoul of other laws.

National Labor Relations Act:  Under the NLRA, employees may engage in concerted, protected activity, which includes discussions related to employees’ mutual aid and protection, and terms and conditions of employment. Sometimes, discussions on these topics can spill over into political speech. For example, employers generally must permit employees to wear and display buttons or other insignia that may be political in nature but also include union messages. Also, employers cannot penalize employees for advocating for political issue campaigns (e.g., opposing right to work legislation), as long as the advocacy and any solicitation takes place in non-working areas during non-working time.

Equal Employment Opportunity Laws:  Some workplace political discussions will necessarily touch on sensitive subjects related to certain protected characteristics, such as gender, ethnicity, national origin, race, and religion. If employers permit political speech or expression in the workplace, then they must be careful that these activities do not imply that they condone or sponsor discrimination or harassment.

Given the numerous problems that political speech and expression can cause for employers, the most prudent course of action is to consider establishing reasonable restrictions on employees’ participation in these types of activities within the workplace.

In a future posting, we will address legal issues surrounding political activity in the workplace that is initiated by employers (as compared to employee-initiated activity, which is addressed here).

In a win for organized labor, the National Labor Relations Board (“NLRB”) reinstated a union-friendly standard under which both temporary and permanent employees may collectively bargain as a single unit without employer consent. On July 11, 2016, the NLRB’s 3-1 decision in Miller & Anderson, Inc., 364 NLRB No. 39 (2016), made it easier to combine workers who are temporarily employed by a staffing agency’s client company with workers permanently employed by that client company to form a union.

Under the new standard, if a staffing agency and its client company are deemed to be joint employers of the temporary workers, the temporary workers may join forces with the client company’s permanent workers, provided that they satisfy the “community of interest” factors demonstrating that it is appropriate to treat them as a single unit. Some of the factors used to determine whether a proposed unit of workers share a community of interest are whether the employees are subject to the same working conditions, are subject to common supervision, and have similar wages and benefit packages.

Click here to read the full client alert.

 

On December 15, 2014, the National Labor Relations Board (“Board”) published its Final Rule governing union elections. The new rule, which will become effective on April 14, 2015, ushers in significant changes to the manner in which the Board handles elections. The Board had attempted to make changes to union election rules in December 2011, but those changes were invalidated for being adopted without a proper quorum.

Under the Final Rule, unions will have an increased advantage in an organizing campaign because, among other things, there will be a dramatically shorter period of time between the filing of a representation petition and an election, making it more difficult for an employer to present its arguments against unionization to its workforce. Below is a list of significant changes under the Final Rule.

• Upon the filing of a petition for a representation election, employers will be required to post and distribute to employees a Board notice regarding the petition and the potential for an election. If an employer also regularly issues communications to its workforce electronically, it must also distribute all election notices to its employees electronically in addition to the hardcopy notices. Before this Final Rule, any such notice was only voluntary on the employer’s part.

• Pre-election hearings must be held within eight days after service of a hearing notice.

• The purpose of the pre-election hearing is to determine if a question of representation exists. A question of representation exists if a proper petition has been filed concerning a unit appropriate for the purpose of collective bargaining or concerning a unit in which an individual or labor organization has been certified or is being currently recognized by the employer as the bargaining representative. Disputes concerning individuals’ eligibility to vote or inclusion in an appropriate unit will not need to be litigated before an election is held. The only issues permitted to be addressed in a pre-election hearing are those necessary to determine whether an election should be held.

• Employers will be required to provide a preliminary voter list at least one day before the start of the pre-election hearing.

• Employers will be required to submit a written Statement of Position one day before the pre-election hearing. If an issue is not addressed in the employer’s position statement, it will be deemed waived.

• Parties will no longer have the right to file post-hearing briefs. Instead, they will be required to request leave to do so. It is anticipated that leave will be infrequently granted.

• The final list of voter eligibility (the so-called Excelsior list) will be required to be produced within two business days after the Region issues its decision and direction of election. The Excelsior list will need to be filed electronically with the NLRB and served on the union. The information in this list has been expanded under the Final Rule to include disclosure of the employee’s name, address, personal cell and home telephone numbers if available, personal email addresses if available, work location, shift, and job classification. The Final Rule did not affect the requirement that the Excelsior list be in the union’s possession for at least 10 days before the holding of an election, unless the union waives the requirement. It is anticipated that unions will be inclined to waive the 10-day period, however.

• There will no longer be an automatic 25-day waiting period between the issuance of a decision and direction of election and the holding of the election.

• A party that files objections to an election must do so within seven days of the tally of ballots and must also submit evidence in support of the objections at the same time the objections are filed. This is a significant departure from the existing rule, which allowed a party to file objections within seven days of the tally of ballots and then take an additional seven days to submit evidence in support of the objections.

• A hearing on the objections, if required, will be held within 21 days from the tally of ballots.

Based on these changes, it is technically possible for an election to be scheduled and held within 13 days of the filing of the petition, provided that the union waives the 10-day Excelsior list period and the Region issues its decision and direction of election the day after the pre-election hearing.

As mentioned above, the Final Rule takes effect on April 14, 2015. Employers should consider taking the following steps now before being faced with a petition and a significantly compressed election timeline.

• Educate the company workforce with respect to the company’s position on unionization.

• Educate employees about the significance of signing authorization cards.

• Conduct surveys to assess the employees’ satisfaction with the terms and conditions of employment.

• Develop a lawful non-solicitation policy if the company does not have one in place.

• Prepare a plan in advance-like a fire safety drill-of how the company will respond in the event of the filing of a petition.

• As part of your advanced plan, identify the roles of different individuals in your organization and their respective responsibilities in executing the plan.

• Assess whether supervisors will be deemed to be Section 2(11) supervisors under the NLRA, and thus excluded from organizing activities.

Does your company provide email access to its employees? Are there restrictions on how and when email may be used? These issues are addressed in the National Labor Relations Board’s (NLRB) December 11, 2014 decision in Purple Communications, Inc., which affects both non-union and union employers. In Purple Communications, the NLRB reversed its position and held that “employee use of email for statutorily protected communications on nonworking time must presumptively be permitted by employers who have chosen to give employees access to their email systems.” The employer can rebut this presumption by demonstrating that special circumstances necessitate a specific restriction to maintain production or discipline. Although this special circumstances justification could encompass a total ban on nonwork email use by employees, this would be a “rare case.”

The handbook provisions at issue in Purple Communications prohibited employees from using company email to engage “in activities on behalf of organizations or persons with no professional or business affiliation with the company” or to send “uninvited email of a personal nature.” In reaching their decision, the NLRB reasoned that the ability of employees to communicate in the workplace is central to exercising their rights under the National Labor Relations Act, especially during an initial organizing campaign. Due to significant changes in technology, email is a critical means of communication which now serves as “the natural gathering place pervasively used for employee-to-employee conversations.”

This decision means that employees who have access to company email may use that email system during nonworking time in order to actively campaign on behalf of a union that is attempting to organize the company, even if such a position is contrary to the position of the company. The decision, however, does not require employers to provide email access to employees where employers have otherwise chosen not to grant any email access at all. Similarly, the decision does not require the company to provide access to the email system to third parties like a union. The decision also does not prevent employers from continuing to monitor employee use of company computer and email systems for legitimate management reasons. The NLRB specifically limited this decision to email without addressing other forms of electronic communications.

Employers who are concerned about running afoul of the Purple Communications decision should review their handbooks and any policies addressing employee use of company email systems. Employers should also review those classifications of employees to which they provide email access.

Unions, in order to increase membership, are now attempting in some cases to represent employees in small “micro-units” as opposed to the traditional approach of representing employees throughout an employer’s facility. Micro-units come into existence when unions “pick off” employees in certain departments, and claim that these departments should be a bargaining unit apart from their co-workers. Unions have employed this strategy because it is generally easier to organize a small number of employees rather than an employer’s entire non-supervisory workforce. (To organize a 15 employee department in a 150 employee workplace, the union would need only 8 supporters instead of 76!) The strategy undermines the traditional criteria that governed whether a bargaining unit is appropriate by allowing unions to “slice up” a workplace by targeting only those workers who agree with them. It also exposes employers to dueling unions, each representing a different department.

Micro-units were first employed in the health care industry, but they now have moved to other industries. For example, on July 22, 2014, the NLRB ruled in Macy’s, Inc., 361 NLRB No. 4 (2014), that cosmetic and fragrance workers at a Macy’s store in Massachusetts were allowed to form a collective bargaining unit for their department alone.

A week later, in Neiman Marcus Group, Inc., 361 NLRB No. 11 (2014), the Board again approved the micro-unit concept generally, but ruled that a unit that was composed of all full-time and regular part-time female shoe associates in the second floor Designer Shoe Department and in the fifth floor Contemporary Shoe Department was not an appropriate unit, because the employees lacked a “community of interest.” Importantly, the NLRB noted that the boundaries for the proposed unit did not resemble any administrative or operational lines drawn by the employer. The sales associates on the second floor worked in their own department but the sales associates on the fifth floor were part of a larger Contemporary Sports Department.

Although the NLRB has clearly endorsed micro-units, employers are not powerless, and they can take steps if they wish to make it more difficult for unions to splinter small groups of employees. For example, employers can cross-train and encourage skill diversity so that employees are more interchangeable. Moreover, rather than having many small departments, employers can have fewer but larger departments with the same supervisors supervising more groups of employees.

The NLRB, in a 2-1 decision Iron Tiger Logistics NLRB 10-23-12.pdf, extended the duty to respond to union requests for information to cover requests for information that is found to be irrelevant to legitimate bargaining concerns.  Prior cases had found employers who delayed in turning over relevant information to have violated the Act by delaying their responses.  In Iron Tiger, the Board majority (Chairman Pearce and Member Block) found that even if the information requested turns out to be irrelevant, the employer has a duty to respond in a timely fashion on pain of violating its duty to bargain in good faith.  The policy justification for the rule is that the employer can avoid a dispute and resulting Board charges if it states its position right away and allows the union to withdraw or modify its request.  They observed that, had the employer done so in the case before them, “an unnecessary dispute could have been avoided.”

The dissenting Board member (Member Hayes) agreed that it would be preferable for an employer to respond quickly, but he could not find a duty under the Act to respond to requests for irrelevant information.  He stated, “Ultimately, requested information is either legally relevant to a union’s representative duties, or it is not. If it is not, then the statutory duty to bargain in good faith is not implicated by the request or the employer’s failure to respond timely to the request.”  Member Hayes also observed that the Board majority’s decision gives unions yet another tool “to hector employers with information requests for tactical purposes that obstruct, rather than further, good faith bargaining relationships.”

Employers who are confronted with demands for information that they believe seek irrelevant information should therefore say so without undue delay.  The alternative is to risk an unfair labor practice finding.  In connection with some other activity (such as a strike) a finding of a failure to bargain by refusing to give a timely response to an improper union information request could be enough to turn an economic strike into an unfair labor practice strike.  The consequence for an employer who responds to the strike by hiring replacements could be significant.