Today’s Labor Updates:
What’s next? More bad news for employers
Summary of NLRB Decisions for Week of October 5 – 9, 2015
NLRB continues crackdown on employment policies
French President François Hollande Vows to Press On With Labor Reform
What’s next? More bad news for employers
Duane Morris LLP James R. Redeker
USA October 16 2015
In August, the Labor Board reversed thirty years of precedent in its Browning-Ferris decision. It is poised to do it again. This time the precedent dates back to 1973.
In Browning-Ferris, the Board expanded the joint employer test from whether the host employer exercises direct control over agency employees to include whether the host employer exercises indirect control (e.g., host employer supervisors tell agency supervisors what their employees should do) and/or have possible control (e.g., the contract with the agency retains direct or indirect control over agency employee wage/hour costs). Browning-Ferris so vastly broadened the joint employer determination that now it is almost impossible for a host employer to have even any realistic control over the work done by and cost of the agency employees without being a joint employer. The result is that if the agency employees choose to be represented by a union, the host employer will have to be at the bargaining table and negotiate with the union about the terms and conditions of their employment, at least while working at the host employer’s facility.
What’s up next for the Board is to close the circle and will, no doubt, use the pending case of Miller & Anderson to do it: permit bargaining units comprised of both host and agency employees, even when one or both employers object.
Assuming that the Board does use Miller & Anderson to reverse a principle that dates back to 1973 (Greenhoot, Inc.) and permits mixed units, employers that use agency employees and who are determined to be joint employers under Browning-Ferris may be forced to negotiate a single labor contract covering both its and agency employees. The two decisions will make the following scenario possible:
- An employer of thirty-five regular employees hires an agency to supply it with fifteen workers during the host’s busy season.
- A union gets authorization cards from all fifteen agency workers with the promise that the union will get them full-time, “permanent” jobs with benefits with the host employer. Since the union has more than 30% of the total number of employees signing cards, the union files a petition for an election covering a unit of both the staffing agency employees and the host’s employees.
- Because the host employer is a “joint employer” under Browning-Ferris, the Board approves of the unit and schedules an election.
- If the union wins the election, the host employer and the agency will have to bargain a labor contract that will cover both the host employer’s regular employees and the agency’s employees.
Of course, there are many unstated facts in the above scenario, but the scenario is neither unreasonable nor unlikely.
Employers that use agency employees must anticipate that they not only may be joint employers of the agency employees but also that they may have to deal with a bargaining unit that includes both its employees and the agency employees.
What if an agency employee working at the host’s facility and covered by the labor contract with the host is transferred to another employer? The other employer could not refuse to accept the employee because he/she is represented by a union at the host’s facility because the refusal would violate Section 8(a)(3) of the NLRA. The questions and complications seem endless.
If employers who use agency employees are not taking actions now to avoid the perfect storm that will be caused by the conjoining of the Board’s Browning-Ferris and the anticipated Miller & Associates decisions, the circle closed by the Board will be a noose.
Next up – reversal of the Board’s 1988 decision in DuPont Co that denied Weingarten rights to non-union employees. It’ll happen and non-union employers will be required to permit a union salt to be present during any investigative interview with an employee who requests it. All that has to happen is the right case to come before the Board as a vehicle.
By the way, there is no party who will be affected by the Miller & Associates decision. Miller & Associates employees are no longer used by the host employer. The Board’s decision would be purely advisory…something that is not permitted because it is beyond the authority of the Board, if anyone bothers to look at judicial history. So, maybe the case that will be used to reverse DuPont Co. will not have to be four-square either. Any excuse will do for this Board of activists..
Summary of NLRB Decisions for Week of October 5 – 9, 2015
The Summary of NLRB Decisions is provided for informational purposes only and is not intended to substitute for the opinions of the NLRB. Inquiries should be directed to the Office of Public Affairs at Publicinfo@nlrb.gov (link sends e-mail) or 202‑273‑1991.
Summarized Board Decisions
No Published Decisions Issued
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Unpublished Board Decisions in Representation and Unfair Labor Practice Cases
R Cases
No unpublished R cases issued.
C Cases
RGIS, LLC (28-CA-136313) Mesa, AZ, October 8, 2015. Order granting the joint motion of the Respondent, the Charging Party, and the General Counsel to waive a hearing and decision by an administrative law judge and to transfer the proceedings to the Board for a decision based on a stipulated record, and approving the parties’ joint stipulated record. Charge filed by an individual.
The Columbus Show Case Company d/b/a CSC Worldwide and CSC Specialty Retail Group, LLC, a single Employer (09-CA-112725, et al.) Columbus, OH, October 9, 2015. No exceptions having been filed to the August 27, 2015 decision of Administrative Law Judge Arthur J. Amchan finding that the Respondent had engaged in certain unfair labor practices, the Board adopted the judge’s findings and conclusions, and ordered the Respondent to take the action set forth in the Judge’s recommended Order. Charges filed by Sheetmetal Workers International Association, Local Union No. 24, AFL-CIO; Council of Industrial Workers, United Brotherhood of Carpenters and Joiners of America, Local 2077; International Brotherhood of Electrical Workers, Local Union 683, AFL-CIO; International Union of Painters and Allied Trades, District Council 6, Local Union No. 1275, AFL-CIO, CLC; and Glaziers, Architectural Metal and Glass Workers Local Union No. 372.
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Appellate Court Decisions
No Appellate Court Decisions involving Board Decisions to report.
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Administrative Law Judge Decisions
United States Postal Service (28-CA-143749 and 28-CA-147765; JD(SF)-41-15) Albuquerque and Santa Fe, NM. Administrative Law Judge Mary Miller Cracraft issued her decision on October 9, 2015. Charges filed by National Association of Letter Carriers, Branch 989, affiliated with National Association of Letter Carriers, AFL-CIO and National Association of Letter Carriers, Sunshine Branch 504, , affiliated with National Association of Letter Carriers, AFL-CIO.
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NLRB continues crackdown on employment policies
USA October 16 2015
Why it matters
Continuing the National Labor Relations Board’s (NLRB) focus on employer handbook provisions, an Administrative Law Judge (ALJ) for the agency ordered Verizon Wireless to rescind multiple sections from its handbook related to employee communications. Provisions at issue included one section providing that the employer could discipline employees for causing Verizon Wireless “embarrassment,” a clause on using internal e-mail for solicitation, and another on the disclosure of nonpublic company information. Three out of the five sections considered by the ALJ were found to be in violation of Section 8(a)(1) of the National Labor Relations Act (NLRA), as the embarrassment provision was “overly broad,” and a ban on using e-mail for solicitation could impact the ability of employees to communicate about wages, hours, and other working conditions. The judge ordered the employer to rescind all the unlawful handbook sections and post notice about the action at Verizon Wireless workplaces. In a statement, the employer said it was considering its options, as “[t]here is no claim that Verizon Wireless violated any employee rights,” and the case “concerns technical claims about the wording of certain Verizon policies.”
Detailed discussion
In 2014, Verizon Wireless promulgated a company-wide Code of Conduct that applied to all of its offices across the country. A slightly altered version was released in 2015, but the 2014 version of the Code of Conduct remains in place at some Verizon facilities.
Five provisions of the Code were challenged in an administrative proceeding with the National Labor Relations Board (NLRB). Administrative Law Judge (ALJ) Mary Miller Cracraft found three of the five to violate Section 8(a)(1) of the National Labor Relations Act (NLRA) by interfering with, restraining, or coercing employees in exercise of their rights guaranteed in Section 7 of the Act.
Section 1.6 of the Code addressed solicitation and fundraising and prohibited “the distribution of non-business literature in work areas at any time” as well as “the use of company resources at any time” including e-mails, fax machines, computers, and telephones, to distribute or solicit.
This provision focused too much on employer property rights and too little on the importance of e-mail as a means of workplace communications, the ALJ said, citing a 2014 decision from the Board in Purple Communications, Inc. No special circumstances were presented to justify such a restriction in order to maintain production and discipline.
According to the decision, Verizon’s “rule prohibits both solicitation and distribution.” “In Purple Communications, the Board explained that e-mail ‘is fundamentally a forum for communication.’ The Board found it inappropriate to treat e-mail as ‘solicitation’ or ‘distribution’ per se, recognizing that as forum of communication it constituted solicitation, literature or information, distribution or merely communication that is none of those but nevertheless constitutes protected, concerted activity. Thus both the prohibition on solicitation as well as the prohibition of distribution contravene the holding of Purple Communications.”
The next Code provision, Section 1.8, covered employee privacy. Verizon Wireless provided that appropriate steps must be taken to protect all personal employee information, including financial information, and workers “should never access, obtain or disclose another employee’s personal information” absent legitimate business purposes.
Although employers have a substantial and legitimate interest in maintaining the privacy of certain business information, the “2014 Code of Conduct Employee Privacy rule is broadly worded and, in my view, would be reasonably read to prohibit employees from discussing wages, hours, and terms and conditions of employment or disclosing employee information to a labor organization or for other protected, concerted activity,” ALJ Cracraft wrote.
The 2015 Code of Conduct slightly tweaked the employee privacy provision, the ALJ noted, eliminating the reference to financial information. Verizon Wireless argued that when read in context, employees would readily understand that the updated Section 1.8 was designed to protect legitimate employer interest in the confidentiality of private information.
The ALJ agreed, finding that the provision listed “social security numbers, identification numbers, passwords, bank account information and medical information” as examples of confidential employee information. “This information is legitimately protected confidential information,” and a reasonable reading of the entire provision in context sends a message to employees not to access, obtain, or disclose the listed data.
Next up: Section 2.1.3 on activities outside of Verizon Wireless. The provision was part of Section 2.1’s “Avoiding Conflicts of Interest” heading and dealt with insider trading, cautioning employees that participation in an individual capacity in outside organizations—such as homeowner’s associations or a local school board—to disclose their association with the company and remove themselves from voting on a matter that involves the company’s interests.
“Read literally and in context, the rule does not tend to chill Section 7 activities,” the ALJ wrote. “[T]he language is clearly addressed to the ethics of a business decision,” and “the context of the rule clearly indicates that the conflicts of interest it addresses are those created by or related to commercial competition. The rule is not linked to other rules prohibiting participation in outside activities that are detrimental to the employer’s image or reputation.”
The ALJ rejected the General Counsel’s position that the provision violated the NLRA because it banned the disclosure of nonpublic company information. The ban “must be construed as a part of the business ethics policy,” she wrote. “After all, the rule has nothing to do with membership in a labor organization and it strains logic to read the rule as requiring that an employee who joins a labor organization is constrained to reveal that he or she is employed with Verizon Wireless. The requirement that employment be revealed without disclosing nonpublic information is clearly linked to discussing or voting on a matter related to Verizon Wireless or its products.”
Although Section 3.3’s rule on the appropriate use of Verizon Wireless machinery could not be susceptible to mean e-mail systems, the decision found that Section 3.4.1’s prohibition on the use of “company systems … to engage in activities that are unlawful, violate company policies or result in Verizon Wireless’ liability or embarrassment,” did violate the NLRA.
“A reasonable reading of Section 3.4.1 is that employees will be disciplined for using company e-mail to communicate with a group of employees inside the company on behalf of a labor organization or employees engaged in protected, concerted activity if such use will result in Verizon’s ’embarrassment,'” ALJ Cracraft wrote. “Not only does such language contravene Purple Communications, it is also overly broad in the use of embarrassment as a cause of discipline in use of e-mail, instant messaging, intranet or internet.”
The ALJ ordered Verizon Wireless to rescind the three provisions found to violate Section 8(a) of the NLRA and post appropriate notice for employees.
To read the ALJ’s decision in Verizon Wireless, click here.
French President François Hollande Vows to Press On With Labor Reform
By William Horobin The Wall Street Journal
Oct. 19, 2015 12:16 p.m. ET
PARIS—President François Hollande said Monday he would forge ahead with simplifying France’s labor laws, as he seeks to increase labor flexibility against the backdrop of a deepening conflict with leftist unions.
“Our social model must be overhauled,” Mr. Hollande told an annual conference of employers and unions. “It can’t be frozen forever, outside of the economic context and the reality for workers.”
Mr. Hollande’s warning to labor and employer unions reveals how the Socialist leader’s consensus building approach to overhauling rigidities in the domestic economy is running into difficulties.
Relations with labor unions have become increasingly fractious in recent weeks, making it tougher to rally support for changes to labor laws that Mr. Hollande says are necessary to create jobs and bring down double-digit unemployment.
‘Our social model must be overhauled. It can’t be frozen forever, outside of the economic context and the reality for workers.’
—President François Hollande
Earlier this month, protesters ripped the shirt off an Air France AFLYY -1.07 % executive during layoff negotiations. Last week a representative of the leftist CGT union—which boycotted Monday’s conference—refused to shake Mr. Hollande’s hand, saying conditions for workers in France are unacceptable.
“When we see government ministers, we tell them about workers’ exasperation and say to them: watch out, things are going to blow up,” Philippe Martinez, head of the CGT, said in an interview with local weekly Journal du Dimanche.
Mr. Hollande took office in May 2012 pledging to put an end to conflict between unions and the government and to overhaul the country’s rigid labor laws through negotiation.
The Socialist leader chalked up some successes in the early years of his presidency—an overhaul of pensions and a simplification of some layoff procedures—but the economy hasn’t responded and unemployment has continued to rise. The latest figures show there have never been so many unemployed people in France and the economy stagnated in the second quarter, prompting labor unions to say Mr. Hollande’s pro-business tweaks to labor laws have been ineffective.
Labor unions have also protested Mr. Hollande’s other major economic policies, in particular a plan to cut taxes for employers to improve company margins.
Mr. Hollande offered some olive branches to unions on Monday. He promised to create a new system to grant workers’ rights to training, and said he wouldn’t take apart the 35-hour working week or the minimum wage.
But the Socialist president also said negotiating procedures must be reformed to give companies greater independence from national unions and laws.
“The status quo is no longer possible. The choice is between reform and break-up,” Mr. Hollande said.
Mr. Hollande also said he would stick with plans to open negotiations on changes to unemployment benefits to reduce debts in the system and encourage workers to return to work.
Speaking earlier Monday, Mr. Hollande said the economy will continue to lag the wider eurozone if the country doesn’t follow his plans for reform.
Mr. Hollande has said the French economy will grow only 1.1% this year. That is slightly higher than the official forecast, but insufficient to bring down unemployment, government officials say.