by Phil Wilson
NLRB Ends 2019 with a Bang
What a difference a year makes. In the last seven days the NLRB has issued several hugely important rules and decisions, and it looks like the Ring Board is just getting started.
It took a while for this Board to hit its stride. This was primarily due to political foot-dragging, like delays in getting Board seats filled followed by the weaponization of the recusal process. It was also due to run of the mill foot-dragging with Board opinions (I presume dissents). Those days are now over.
Member McFerran left the board this week after her term expired. As is customary, numerous decisions and rules issued as she departed, including dissents she no doubt wanted to make sure were included before her term ended. There was a lot of dissenting for her to do.
Perhaps the most important decision is McDonalds. While the joint employer issue still awaits a comprehensive final rulemaking (which could issue any day), this decision settles a critical issue to a huge part of the American economy: the franchise model. In McDonalds the Board found that McDonalds the franchisor is not a joint employer with its franchisees. The Board ordered an administrative law judge to accept a settlement on that basis. The sound you hear is millions of franchise owners and operators breathing a huge sigh of relief.
It’s hard to overstate how devastating imposing joint employment on franchisors would be to the franchise business model, which is responsible for the employment of millions of American workers and a huge part of our economic engine. Ultimately the Board’s rulemaking will create more solid protection, but this decision is a great start.
In a bit of a surprise, the Board also issued a rulemaking that modifies the ambush (or quickie) election rule from the Obama administration. These modifications dramatically improve the biggest problems with the quickie election rule. First, the rule provides a bit more time for the parties to prepare for a unit hearing and get employee lists together. It also provides a 20-day buffer between the direction of an election and the vote. These common-sense rules make sure the vote isn’t a fire drill like it is today.
More importantly, the modifications put unit determination issues back where they belong – before an election is directed. The ambush rule requires the Region to direct an election even when it’s unclear whether a significant number of voters are actually going to be included in the eventual unit. Instead the ambush rule waits to decide these issues until after the election – if ever.
These unit determination changes never made any sense. The ambush rule was the equivalent of holding a Presidential election but deciding whether we’re going to count the votes of Texas until after the election. Under the new modifications voters will know who is actually in their bargaining unit – before they vote! What a concept.
Two other important decisions overturn very controversial Obama-era decisions. Caesars Entertainment overturns Purple Communications and returns control of email systems back to employers. Under Purple union supporter employees were allowed to use their employer’s email system to solicit co-workers. Caesars makes clear an employer is allowed to restrict use of its email system to work-related conversations and to restrict solicitation, so long as it is done in a non-discriminatory fashion. I guess you could say they rendered unto Caesars what is Caesars (I know, groan).
The other decision is Apogee Retail which overturns Banner Estrella, the controversial (and maddening) decision that prohibited employers from making a blanket request to employees to keep workplace investigations confidential. Banner drove HR professionals (not to mention agencies like the EEOC and DOL) crazy.
Apogee provides a common-sense approach to workplace investigations. A rule asking employees to keep investigations confidential is presumptively valid, unless there is evidence that the rule is being used to infringe on Section 7 rights. This makes much more sense than the Banner approach (and creates much less confusion with other statutes and agencies who want investigations to remain confidential whenever possible).
Of interest to unionized companies, the Board also reversed the Lincoln Lutheran decision. This required employers to continue to honor dues checkoff provisions and pay dues to a union even after the contract with that clause has expired. In Valley Hospital the Board went back to the Bethlehem Steel rule that allows a company to stop deducting dues once a contract expires.
Once again, the ruling just makes sense. Requiring an employer to keep collecting dues when the contract is expired is like you stopping payments for Disney+ but then telling Disney they can’t cancel your subscription because you just started watching the Mandalorian. And often this happens when the union is threatening economic damage to the employer. Bizarre.
One other important recent development came from the General Counsel’s office. On November 20, Peter Robb sustained an appeal from the National Right to Work Legal Defense Foundation. The General Counsel concluded that a neutrality agreement between a hotel and Unite Here! provided “more than ministerial aid” to the union. Therefore, both the union and the company committed unfair labor practices by entering into the neutrality agreement. This is not a final ruling, but one definitely worth watching.
If the last month of 2019 is any indication, 2020 will be a big year for labor law developments. In the meantime, we wish you a peaceful and blessed holiday season. And get some rest. You’ll need to buckle your seat belts for next year!