In this issue:
- Construction Union Sued for $100 Million
- Teamster Beat
- Insight, Sticky Fingers, Union Bailout Update and more…
The bottom of each story contains a link to the individual post on our site.
Labor Relations Insight by Phil Wilson
“What, me worry?”
For some reason following the high drama over the NLRB’s recent Hy-Brand decision keeps reminding me of one of my guilty pleasures as a kid: MAD Magazine.
Remember MAD? Its cover always features (yeah, it’s still in print… I was surprised too) Alfred E. Neuman, a goofy gap-toothed guy spoofing some current event. It’s “theme” (if you can really say there is a theme) is to question everything, especially authority. From the movies we watch, to our music, to our politics, MAD calls attention to the absurdity and fakeness of the world around us. It will loudly proclaim that you should never trust the media - then immediately remind you that they are part of the media. I’d sum up it’s message like this: ALWAYS look for the wizard behind the curtain.
If you haven’t been following the unfolding drama around the NLRB’s recent Hy-Brand decision you could benefit a lot by looking at it as a MAD Magazine story. It is full of absurdity, fakeness, and to make any sense of it you have to look for the wizard behind the curtain. A lot’s happened this month, so let me catch you up in case you haven’t followed this close.
Last December in Hy-Brand the NLRB overruled the controversial BFI decision. You’ll recall that BFI exploded the idea of “joint employer” to include any situation where a contracting employer reserves a right of control over a contractor instead of requiring direct control. BFI destroyed the traditional concept of separation between a contractor and contracting employer.
The wizard behind the BFI curtain was David Weil. BFI was part of a coordinated attack against contracting relationships in the last administration. Following the playbook from Weil’s Fissured Workplace, the Department of Labor and the NLRB went after contractor relationships with a vengeance. This includes the massive litigation against McDonald’s (hopefully going away soon) whose goal is nothing short of destroying the franchise business model. Other contracting relationships are also under attack using this strategy. Everything from the use of temporary workers to freelance or other innovative “gig economy” services (like Uber and AirBnB) are at stake.
Which leads us to Hy-Brand. Democrats today are playing a version of the “Four Corners Offense.” That basketball offense, popularized and perfected by Dean Smith, was really more of a defense. You ran it by posting players in the four corners of the basketball court and then starting a giant game of keep-away. This made it virtually impossible for an opponent to get the ball and really do much of anything during a game. It took opponents out of their rhythm and game plan. It was so effective and maddening for opponents (and fans) that they outlawed it by adding a shot clock and 3-point line in basketball.
That is the same offense being run by Democrats in the Senate and at the NLRB. They are banking on a big shift in the congressional landscape in 2018 and then hoping for another shift in administrations in 2020. They are running the Four Corners by stalling every agency appointment they can. They are slow-playing decisions. And now they are playing the ethics card in Hy-Brand.
Right after Hy-Brand was decided the NLRB dropped back to 4 members, 2 Republicans and 2 Democrats. Therefore nothing of substance can be done while we wait (again) for a third Republican Board member. Four corners.
Next came the claim that Member Emanuel should have recused himself from Hy-Brand. This was a total head-scratcher. Emanuel never represented any of the parties in Hy-Brand. His old firm hadn’t either. The claim was that since his old firm was involved (tangentially) in the BFI decision that he was somehow precluded from deciding a case involving the law of the BFI case. Four corners.
It’s hard to imagine the wizard behind the curtain could have dreamed that this next part would actually work out like it did. The recusal claim triggered an Inspector General investigation which took on a life of its own. The Inspector General, in an unprecedented (and very suspect) decision, decided Emanuel was issue-precluded from participating in a decision overruling BFI. This astounding opinion - if allowed to stand - essentially means Board members can be precluded from ruling on issues their prior firms litigated. It basically takes them off the playing field for most significant issues. Four corners.
Even worse, the three remaining members of the NLRB (including, surprisingly, Republican Chairman Kaplan) called a secret Board meeting to reconsider Hy-Brand. They did this without any notice to Member Emanuel and probably in violation of the Sunshine Act. They then adopted the analysis of the Inspector General and overruled Hy-Brand. Four corners.
Finally, in a scene straight out of MAD Magazine’s long-running series Spy vs. Spy, the Board issued its new opinion in Hy-Brand while 3 of the Board members (Emanuel, Pearce and McFerran) were all in San Juan Puerto Rico presenting to members of the American Bar Association’s Labor and Employment Law section. Emanuel - who is the walking embodiment of the word gentleman - was sneak-attacked by his “colleagues” at the Board. The timing could not have been accidental, which makes it even more outrageous. Four corners.
This entire drama continues to play out, but if you haven’t read the brief in favor of reconsideration of Hy-Brand you should. Bottom line: don’t start an ethics investigation with unclean hands. And there are a lot of questionable ethical decisions surrounding this reconsideration. The Inspector General’s report was leaked to Senators. Fingers are pointing to the offices of Members Pearce and McFerran, and the Inspector General. And what conversations led to the decision to eliminate Member Emanuel from the decision to reconsider Hy-Brand (with no opportunity to object or provide his reasons against recusal)?
The four corners offense is the perfect Democrat strategy and if I was just watching this as a political scientist I’d have to applaud. But watching it as a participant is difficult. Bill Emanuel’s treatment by his colleagues is shameful. There is no reasonable reading of the ethics rules that require his recusal in Hy-Brand. That will eventually be clear. In the mean time keep your eye on the wizard behind the curtain. Unlike Alfred E. Neuman, I am worried.
Union Bailout Update
Interesting times at the NLRB, and the dust may not settle for quite some time. After the Bill Emanuel “conflict of interest” intrigue, and the boards’ vacating of a December ruling rescinding Obama-era joint employer parameters (see Insight), Democrats in the Senate are jumping on that same piece of red meat to hold up the confirmation of John Ring, while business groups are jumping back on the legislative bandwagon to resolve the joint employer issue outside of NLRB rulings. Meanwhile, earlier this month, a motion to reconsider the order to vacate was filed, and the political motivations of the Inspector General’s office is being called into question. Not to be left out of the party, unions are attempting to see how much mileage they can get out of the concept of recusal by attempting to have vacated the Boeing v. Society of Professional Engineering Employees in Aerospace decision.
The NLRB General Counsel’s Division of Advice office released 43 advice memoranda just before Spring Break. Among the topics addressed:
- Google’s dismissal of an employee for violating an anti-harassment and discrimination policy
- An employee benefit PowerPoint that created a binding contract provision
- The connection of social media policies between a franchisor and franchisees
- Union’s use of shadow Facebook groups to intimidate employees
Although the memoranda are not binding, they are designed to present guidance to the regional offices on new or novel issues. For details on the four mentioned above, read the full article here, and to review all of the memoranda go here to the board’s website.
The NLRB has extended yet again the deadline for public comments on whether to rescind the Obama-board rule shortening the time period for union elections. Both business and union interests had asked for an extension, and the board extended the deadline to April 18th.
The Janus case still continues to hold our interest while the issue works its way out in court. If you’d like to read the oral arguments you can secure the transcript here. While waiting for resolve, union groups in Wisconsin are attempting to leverage the concept behind the original Janus decision to challenge the 2011 Act 10 legislation in that state restricting bargaining rights for public employees. Two locals of the International Union of Operating Engineers filed a lawsuit naming Governor Scott Walker, attorney General Brad Schimel and James K. Daley, the chair of the Wisconsin Employment Relations Commission, as defendants.
As unions (disingenuously) attempt to jump on the #metoo bandwagon, it has come back to bite them again, this time at the hands of the NLRB. This came in a board move to vacate an administrative trial court’s decision dismissing a breach of duty of fair representation case against a union for discriminating and sexually harassing a female union member. The board took to task the ALJ’s credibility determinations, which make for some very interesting reading.
It’s All Academic
Duquesne University has filed a petition asking the U.S. Court of Appeals to overturn an NLRB ruling ordering the university to bargain with an adjunct faculty group. The university argues that the NLRB holds no jurisdiction over it as it is a religious institution.
In a not-so-similar story out of Texas, the NLRB itself ruled that it holds no jurisdiction over a local charter school because “state law made school administrators responsible to public officials.”
Meanwhile, proponents of student unions have withdrawn petitions to organize at Yale, the University of Chicago, and Boston College. Instead, the unions – which include the American Federation of Teachers, the Auto Workers, UNITE HERE, and SEIU – said “they’d rather continue to seek voluntary union recognition from their institutions—an unlikely prospect.” Organizing efforts continue at Penn State and Harvard.
Lastly, a bill in New Hampshire looks to make it illegal for universities to spend any money on anti-union activities. Read more here.
Construction Union Sued for $100 Million
A New York construction company has filed a lawsuit against the Building and Construction Trades Council of Greater New York. The suit claims that the union has bilked the company out of more than $100 million over the course of the last six years during which the company hired over 20,000 union construction workers for jobs in the state.
Some of the corrupt practices the company alleges have been used by the union include inflated worker hours, misclassifying employees to encourage higher pay, and interference in contract negotiations in an attempt to bring in more corrupt unions before moving onto the next phase of a “mega” development project.
Underfunded pensions have been a big problem for the Teamsters in recent years. Teamster president James P. Hoffa stepped into the spotlight to demand a solution. Or rather, to demand that the government fix it.
Rather than take responsibility for the Teamsters own part in losing the retirement savings of hundreds of thousands of its members, Hoffa puts the responsibility on the House-Senate Joint Select Committee. Click here to read more.
In other Teamster news, for the first time in two decades, the union is backing a Republican candidate for Massachusetts governor. Candidate Charlie Baker enthusiastically accepted their endorsement; but many believe that, in time, he’ll wish he hadn’t due to the Boston local’s terrible reputation for being a “pariah union.”
Worker Centers have been in play for a while. Unions use them as a way to circumvent federal rules placed on labor unions. These centers, often funded by unions themselves, primarily work to rally troops for organizing purposes. In more recent years, they’ve been used as quasi-unions, actually developing representative relationships and bargaining on behalf of employees.
However, a recent letter from the House Subcommittee on Health, Employment, Labor, and Pensions has asked the Department of Labor recognize these worker centers for what they are and, in turn, regulate them in accordance with the law. The letter makes three specific requests:
Establish an updated test to determine whether a worker center should be classified as a labor organization under the LMRDA;
Initiate investigations and enforcement against worker centers that are subject to reporting requirements under the LMRDA but do not file reports; and
Require increased clarity and transparency in the reports of worker centers that appear to be serving as improper go-betweens for international unions and non-reporting entities.
The pressure is officially on Alex Acosta and the DOL. We’ll stay tuned to see how he responds.
In the midst of Janus v. AFSCME and Mark Janus’ argument that he shouldn’t have to contribute money to a union of which he is not a member, for them to then in turn spend that money to further their own political agenda (again, an agenda that he or other members may or may not support), Rasmussen Reports conducted a survey of 1,000 American people to get a feel for where we stand on labor unions and their effect on politics today. The results of that survey are as follows:
- 41% of likely U.S. Voters believe labor unions have too much political influence;
- 25% think they don’t have enough influence;
- 18% feel labor unions have basically no impact on politics in this country; and
- 16% are not sure
The Machinists announced earlier this month that they will try for the third time to organize workers at Boeing’s North Charleston plant in South Carolina. Utilizing the “micro-unit” strategy, the union is going after a small group of workers, characterized as “flight line workers” within the facility.
Joan Robinson-Berry, Vice President and General Manager of the plant said, “The union refuses to hear the clear message our team has voiced repeatedly.” Last time a vote was held at the plant in 2017, 74 percent of workers voted against unionization. The time before that, the union withdrew its petition to organize just five days before the election was slated to take place.
Earlier this month, the UAW Retiree Medical Benefits Trust decided to sell 40 million of its shares in General Motors Co. worth $1.6 billion. Despite this move, the UAW group will still likely remain GM’s largest investor. However, we do not know the effect this will have on the group’s “guaranteed” seat on the company’s board – the same one that was held by UAW Vice President Joe Ashton, but which Ashton vacated shortly after the UAW/FCA corruption scandal began. (Hmmm….)
Speaking of the corruption scandal, another UAW official has been indicted. Find out more here. Also, federal investigators have started looking into nonprofit groups that are funded by the union. Why? Because just one year before the investigations were made public, the union let the nonprofit registrations expire (essentially putting them into dormancy). “The UAW-related donations, the structure of the charities and the use of nonprofit funds after the officers’ retirements are all areas investigators are looking into,” according to a person close to the probe.
In organizing news, the union recently won a contract with Airbnb covering nearly 150 cafeteria workers at four different locations. Also, many are expecting the UAW’s intention to organize Tesla’s electric car division in Fremont, Cali. to come to a head. This, after a string of unfair labor charges were filed by the union against the company. Things are getting nasty.
Labor Around the World
According to the International Labor Organization, “nearly 25 million people work in forced-labor conditions worldwide, with 47 percent of them in the Pacific region.” Coca-Cola Co and the U.S. State Department, along with two other companies, are hoping to utilize blockchain’s digital ledger technology to “create a registry for workers” in an effort to fight forced labor worldwide. Learn more here.
Late last month, French president Emmanuel Macron announced that the government was planning major railway reform at state-owned, debt-ridden SNCF Railways. Changes include “the abolition of jobs-for-life guarantees, automatic annual pay raises and generous early retirement.”
Pushback from the unions who represent the roughly 150,000 railway staff was to be expected, but it looks like they are taking it a step further than engaging in the planned strikes. Rumor has it, some unions are asking their members to cause problems for passengers during non-strike days as well.
Workers in Japan will see a 2.16 percent raise in wages this spring. Economists are unsure if this will be enough to “power the desired ‘virtuous cycle,’ where greater take-home pay leads to more spending, business investment and inflation.” Time will tell.
Current charges or sentences of embezzling union officials:
- Timothy Smith - ACT: $80,000
- Joel Wagner - DCDSA: $10,000
- Mike Music - King County Corrections Guild: $1,300
- Robert Clearwater - SEIU: $11,681
- Pamela Noble - USW: $43,275
Labor Relations INK is published semi-weekly and is edited by Labor Relations Institute, Inc. Feel free to pass this newsletter on to anyone you think might enjoy it.
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Contributing editors for this issue: Phillip Wilson, Greg Kittinger, and Meghan Jones
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