September 7, 2022

By: David Keating

On September 6, 2022, the National Labor Relations Board (NLRB) issued a Notice of Proposed Rulemaking as to the legal standard for determining joint-employer status under the National Labor Relations Act (NLRA).

Under the current analysis of joint-employer status established by the NLRB during the Trump administration in 2020, a company must exercise “substantial direct and immediate control” over essential terms and conditions of employment to be considered the employer of another company’s employees.  “Substantial direct and immediate control” is defined as “direct and immediate control that has a regular or continuous consequential effect on an essential term or condition of employment of another employer’s employees.”  The NLRB further stated that indirect control or contractually-reserved control that is not exercised would not establish a joint employer relationship.

By contrast, the proposed rule lessens the standard by which joint employment will be established. Employers would be considered joint employers if they “share or codetermine those matters governing employees’ essential terms and conditions of employment.”  The proposed rule would define “share and codetermine” to mean “for an employer to possess the authority to control (whether directly, indirectly, or both), or to exercise the power to control (whether directly, indirectly, or both), one or more of the employees’ essential terms and conditions of employment.”  Further, the proposal states that “possessing the authority to control is sufficient to establish status as a joint employer, regardless of whether control is exercised.”

The proposed rule expands upon what will be deemed an “essential term and condition of employment.” Under the 2020 rule’s exhaustive list, wages, benefits, hours of work, hiring, discharge, discipline, supervision, and direction are essential terms and conditions.  The proposed rule adds certain terms and conditions such as “control over workplace health and safety” and “rules and directions governing the manner, means, and methods of work performance.” The proposed rule indicates that the list is not exhaustive and requires “flexibility” in the future.

If adopted, the impact of the proposed rule on employers that utilize or provide sourced labor will likely be dramatic. More workers will be deemed joint employees of two legally separate entities.

The NLRA provides that joint employers have a duty to bargain with a union and are both subject to unfair labor practice charges and potential liability.

The NLRB will accept public comment on the proposed rulemaking before finalizing the rule on or before November 7, 2022.  A reply to those comments received during the initial comment period must be received by the NLRB on or before November 21, 2022.  We will monitor this matter closely.

A copy of the Notice can be found here.

Lindner & Marsack, S.C. represents employers in all areas of labor and employment law.  If you have any questions about the recent proposed rule by the National Labor Relations Board or any other labor or employment issue involving your business, please contact us at any time.

 

By: Kristofor Hanson

In a new memorandum published today, National Labor Relations Board (the “Board”) General Counsel, Jennifer Abruzzo, stated aloud what many had thought would be a goal of the newly appointed chief lawyer for the agency, challenging an employer’s ability to require employees to attend meetings during a union organizing campaign.

In so doing, Abruzzo has asked the Board to reconsider its precedent and find that mandatory meetings – often referred to as “captive audience” meetings – are unlawful. The General Counsel has taken the position that such meetings “inherently involve an unlawful threat that employees will be disciplined or suffer other reprisals if they exercise their protected right not to listen to such speech.” The protected rights to which she refers are those rights granted to workers under Section 7 of the National Labor Relations Act (the “Act”). Those rights include “the right to self-organization, to form, join, or assist labor organizations, to bargain collectively through representatives of their own choosing, and to engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection.” Section 7 rights also include the right of a worker to “refrain from any or all such activities.”

The precedent the General Counsel asks the Board to reconsider dates to 1948 in Babcock & Wilcox Co., 77 NLRB 577 (1948), when the Board found that employers are entitled to require employees, during their work hours, to attend meetings to discuss issues related to a union organizing campaign. Under the Act, Employers are allowed to present factual information to employees during such meetings. They are not, however, allowed to make promises or threaten employees. Accordingly, the Act already places limitations on employers regarding what can be presented during captive audience meetings.

Nevertheless, the General Counsel has taken the position that requiring employees to attend meetings during their working hours crosses a line into the area of coercion and “plainly chills employees’ protected right to refrain from listening to this speech in violation of [the Act].”

Therefore, Abruzzo has asked the Board to revisit this issue and allow employees to refrain from attending any meeting where union organizing will be discussed on paid time and any discussion in which an employee “is cornered by management while performing their job duties.”

The General Counsel contends that imposing these protections will not impair employers’ rights to freedom of expression. However, she does not provide any insight into the mechanisms employers may use to get their message out to employees during an organizing campaign. Those mechanisms will likely be left to meetings on paid time, attendance at which will be entirely voluntary, as well as postings and mailings that have been traditionally used during organizing campaigns.

This request by the General Counsel will likely be met favorably by the Board should it hear a case concerning this issue, as the current Board is comprised of a majority of union-friendly members. The Board may soon hear such a case as complaints on this subject were filed during the recent, failed union organizing campaign at an Amazon facility in Alabama. Should the Board reach a decision on such a case, we will promptly update you with details.

In the meantime, captive audience meetings are still allowed and are an effective way for an employer to get its message out during a union organizing campaign. In these meetings, employers should direct their communications to facts, opinions, and experience with unions, but avoid coercive or threatening language, or promising employees benefits that they may receive should they vote against unionization.

Should you have questions concerning this or any other labor and employment matter, please contact our offices for assistance.

By:  David Keating

Within two days of taking office, President Biden fired National Labor Relations Board (“Board”) General Counsel Peter Robb, Robb’s Deputy General Counsel Alice Stock, and named Member Lauren McFerran, the only Democratic member of the Board, as its Chairman.  These unprecedented firings have resulted in great scrutiny of the new administration from employers.

Following the firings, President Biden named Peter Sung Ohr as Acting General Counsel of the Board.  Ohr is a career employee of the Board. He served as a Field Attorney, Deputy Assistant General Counsel in the Board’s Division of Operations-Management, and as a Regional Director of the Board’s Chicago Regional Office.

Since being named Acting General Counsel, on February 1, 2021, Ohr rescinded a number of General Counsel Memos issued by Robb during the Trump administration.  According to Ohr, he determined that a number of outstanding Robb memoranda are either inconsistent with encouraging the practice and procedure of collective bargaining, the exercise by workers of their full freedom of association, self-organization, and designation of representatives of their own choosing for the purpose of negotiating the terms and conditions of their employment.

A summary of notable Robb memoranda that were rescinded by Ohr:

• GC 18-04, Guidance on Handbook Rules Post-Boeing (June 6, 2018) (instructing Regions on the placement of various types of employer rules into the three categories set out in the then-recent Board decision in The Boeing Company, 365 NLRB No. 154 (Dec. 14, 2017)). Ohr indicated that this Memorandum is being rescinded as it is no longer necessary, given the number of Board cases interpreting Boeing that have since issued.

• GC 18-06, Responding to Motions to Intervene by Decertification Petitioners and Employees (Aug. 1, 2018) (requiring Regions to no longer oppose intervention in ULP hearings by proposed Intervenors such as individuals who have filed a decertification petition or circulated a document upon which the employer has unlawfully withdrawn recognition of the collective-bargaining representative). Ohr noted that this is inconsistent with prior practice.

• GC 19-03, Deferral under Dubo Manufacturing Company (Dec. 28, 2018) (instructing Regions to defer under Dubo [142 NLRB 431 (1963)], or consider deferral thereunder, of all Section 8(a)(1), (3), (5) and 8(b)(1)(A), and (3) cases in which a grievance was filed and not to apply Babcock & Wilcox Construction Co., 361 NLRB 1127 (2014) (“Babcock”) to cases that could be deferred under Dubo). Since Babcock was overruled by United Parcel Services. Corp., 369 NLRB No. 1 (Dec. 23, 2019), GC 19-03 is outdated. To the extent the memorandum made changes to case handling procedures relating to the deferral of cases under Dubo, Ohr directed Regions to follow Section 10118.1(c) of the Unfair Labor Practice Casehandling Manual and the memoranda cited therein.

• GC 20-08, Changes to Investigative Practices (June 17, 2020) (instructing Regions on how to proceed during investigations in connection with securing the testimony of former supervisors and former agents, and how audio records should be dealt with during investigations). Ohr noted that this Memorandum is being rescinded because portions are inconsistent with prior practices. Regions should continue to not accept recordings that violate the Federal Wiretap Act and to apprise individuals who proffer recorded evidence when it may violate state law.

• GC 20-13, Guidance Memorandum on Employer Assistance in Union Organizing (Sept. 4, 2020) (requiring Regions to urge the Board in charges involving union neutrality agreements to adopt the “more than ministerial aid” standard used in union decertification cases).

Ohr’s full memorandum can be viewed here.

Although Ohr’s recent action does not change Board precedent, it provides insight as to his priorities in the event he is named General Counsel.

Lindner & Marsack, S.C. represents employers in all areas of labor and employment law.  If you have any questions about the recent actions at the National Labor Relations Board or any other labor or employment issue involving your business, please contact us at any time.

By: David C. Keating

The National Labor Relations Board (“Board”) continues to restore employer rights under the Trump administration.  Within the last week, two decisions have been handed down by the Board overturning prior Obama administration decisions.

Employer’s Right to Restrict E-mail Use

In a decision dated December 16, 2019, the Board reestablished the right of an employer to restrict employee use of its e-mail system so long as the restrictions are set forth on a nondiscriminatory basis.

Overruling the Obama Board decision in Purple Communications, Inc., which held that employees have a presumptive right to use the system, on non-working time, for communications protected by Section 7 of the National Labor Relations Act (“Act”), the Board, in Caesars Entertainment, 368 NLRB No. 143, held that employees do not have the statutory right to use employer e-mail or other information-technology resources to engage in non-work-related communications.  Rather, employers have the right to control the use of their equipment, including e-mail and other IT systems, and may lawfully restrict the use of those systems, provided that, in doing so, the employer does not discriminate against union or other protected communications.

The Board’s decision in Caesars does recognize that employees must have adequate avenues to engage in communications protected by Section 7 of the Act.  The decision creates an exception for circumstances where the use of employer-provided e-mail is the only reasonable means for employees to communicate with each other on non-working time during the workday.

Workplace Investigation Confidentiality Rules of Limited Duration Are Lawful 

In Apogee Retail LLC, 368 NLRB No. 144, dated December 16, 2019, the Board held that employer work rules requiring confidentiality during the course of a workplace investigation are presumptively lawful.

Overturning the Obama Board decision in Banner Estrella Medical Center, which required employers to prove, on a case-by-case basis, that the integrity of an investigation would be compromised without confidentiality, the Board in Apogee concluded that the framework set forth in Banner improperly placed the burden on the employer to determine whether its interests in maintaining the integrity of an investigation outweighed employee Section 7 rights.

By applying the test for facially neutral workplace rules recently established in Boeing Company, 365 NLRB No. 154 (2017), the Board determined that investigative confidentiality rules limited to the duration of the investigation are generally lawful.  In this case, the Board remanded the case for further consideration because the employer’s confidentiality rules did NOT limit confidentiality to the duration of the investigation.

This decision is more aligned with EEOC enforcement guidance.

Lindner & Marsack, S.C. represents employers in all areas of labor and employment law.  If you have any questions about lawfully restricting the use of your Company’s e-mail system, work rules or any other labor or employment matter involving your business, please either contact me at dkeating@lindner-marsack.com or any other attorney you may work with at the firm.

David Keating and Kristofor Hanson

Over the course of the past year, the National Labor Relations Board (“Board”) has indicated its willingness to develop more employer-friendly standards that allow employers more flexibility in managing their businesses and their unionized workforces.  Just in the past week, the Board continued its efforts with a ruling allowing for greater ease in implementing unilateral changes to job terms and by seeking input on a troubling standard that had protected outrageous speech by employees.

In M.V. Transportation, 28-CA-173726, decided September 10, 2019, the Board overturned a long-standing, stringent standard that limited an employer’s right to make unilateral changes to job terms such as work rules and attendance policies.  In doing so, it adopted a new “contract coverage” test that allows employers more flexibility in making such changes.

The “contract coverage” standard allows an employer to make unilateral changes to employees’ terms and conditions of employment if the labor contract “contains a provision that broadly grants the employer the right to implement new rules and policies and to revise existing ones.”  An employer would thus have the right to enact changes such as implementing new attendance and safety rules or revise disciplinary or off-duty access policies, according to the Board.

Under the previous “clear and unmistakable waiver” standard, for an employer to make unilateral changes to work rules, attendance policies, or the like, it had to demonstrate that the contract specifically and unequivocally waived the union’s statutory right to bargain over that particular issue.  In overturning this standard, the Board followed the lead of the D.C. Circuit Court of Appeals, which had stated that the “clear and unmistakable waiver” standard was “in practice, impossible to meet.”

According to the Board, the new “contract coverage” test will allow every part of a collective bargaining agreement to be given its bargained-for effect, including those that give an employer the right to act without bargaining first.

Board Will Reconsider Its Loss-of-Protection Standards for Profane and Offensive Outbursts of a Racial and Sexual Nature

In another notable Board development, on September 5, 2019, the Board requested briefing on whether it should reconsider its standards for profane outbursts and offensive statements of a racial or sexual nature.  The Board issued a notice and invitation to file briefs in General Motors LLC, 14-CA-197985 and 14-CA-208242, seeking public input on whether to adhere to, modify, or overrule the standard applied in previous cases in which extremely profane or racially offensive language has been deemed protected by the National Labor Relations Act (“Act”).

Specifically, the notice seeks comments relating to the following cases: Plaza Auto Center, 360 NLRB 972 (2014), Pier Sixty, LLC, 362 NLRB 505 (2015), and Cooper Tire, 363 NLRB No. 194 (2016).  These cases, discussed in General Motors, resulted in considerable protection for outrageously offensive statements.The Board’s treatment of such sexually and racially offensive statements has been criticized as both morally unacceptable and inconsistent with other workplace laws by federal judges as well as within the Board itself.

About the invitation for briefing, Chairman John F. Ring stated: “The Board’s request for briefing on this important topic reflects its long-standing practice of seeking input from interested parties when the Board believes it can benefit from such briefing. We look forward to considering the views of all interested parties.” 

Amicus briefs not to exceed 25 pages in length may be filed with the Board in Washington, D.C. on or before November 4, 2019.

Lindner & Marsack, S.C. represents employers in all areas of labor and employment law.  If you have any questions about the notice and invitation to file briefs or any other labor or employment issue involving your business, please contact us at any time.

By: Christopher J. Saugstad

September 6, 2019

On August 29, 2019, the National Labor Relations Board (the “Board”) determined that employers do not violate the National Labor Relations Act (the “NLRA”) merely by misclassifying employees as independent contractors when they should have been classified as employees.

In Velox Express, Inc., 15-CA-184006, 368 NLRB No. 61 (2019), the Board reversed a prior Obama-era decision which ruled Velox had unlawfully interfered with its workers’ rights under the NLRA. Velox Express, Inc. (“Velox”) is a medical courier service in which a number of its drivers were classified by Velox as independent contractors. The Charging Party in Velox raised group complaints of the independent contractor classification and was subsequently discharged.

Initially, an Administrative Law Judge ruled Velox had interfered with workers’ rights by Velox’s misclassification of the Charging Party. Upon review, the Board requested briefing and received thirteen briefs from twenty-eight interested parties. The Board, utilizing their recent decision in SuperShuttle DFW, Inc., 367 NLRB No. 75 (2019), determined the workers were actually employees and therefore protected by the NLRA. The Board held Velox had violated the NLRA when it discharged the Charging Party for bringing to management’s attention group complaints regarding its treatment of employees.

Notably, however, the Board reversed the judge’s decision that the misclassification of independent contractors violated the NLRA as a separate and distinct violation. The Board reasoned “erroneously communicating to workers that they are independent contractors does not, in and of itself, contain any ‘threat of reprisal or force or promise of benefit.’” The Board held this type of misclassification would not inherently threaten employees’ adverse actions like discharge if they were to engage in protected activities under the NLRA; nor would the communication of classification solely show it was futile for the workers to engage in such protected activities. The Board explained, “[i]n and of itself, an employer’s communication of its position that its workers are independent contractors simply does not carry either implication.”

Additionally, the Board held that finding that a misclassification created a violation of the NLRA would deter employers from creating independent contractor relationships and would improperly shift the burden of proof to employers.

The Board’s recent ruling in Velox means the Board has removed itself from any future decisions based solely on worker misclassification. Unlike employees, who enjoy protected rights under the NLRA including unionization, independent contractors are not covered by the NLRA and are therefore not protected by it either. While this decision is viewed as a victory for employer, the importance of properly classifying and paying employees remains critical to avoid possible violations of the Fair Labor Standards Act (the “FLSA”).

Lindner & Marsack has represented employers in their dealings with unions for over a century. If you have any questions about this case or any other aspect of classic labor-management law, please feel free to contact us at any time.