Sometimes, using only one word can make all the difference between a lawful and unlawful statement. Washington University in Saint Louis learned this lesson the hard way when in late October 2017 Associate General Counsel for the NLRB’s Division of Advice Jayme L. Sophir instructed Region 14 to issue complaint, absent settlement, against the University.

The Advice Memorandum, released to the public on February 15, 2018, found the University violated Section 8(a)(1) of the Act by threatening foreign graduate students with deportation if they elected a union and, later on, their union engaged in a strike. Specifically, the statement – “all foreign students will lose their visas and have to leave the country” – was unlawful because a strike would not automatically result with graduate students losing their visas. As labor practitioners know, employer predictions regarding unionization must be based on objective facts and, in general, be measured, reasonable and not overstate adverse consequences as such actions could be seen as restraining and coercing employees’ Section 7 rights.

Here, while a strike could potentially lead to these graduate students losing their visas and being deported, Associate General Counsel Sophir noted the University “overstated the requirements of the applicable regulations and the potential effects of those regulations on the affected graduate student employees.” Conversely, the other statements made by the University concerning immigration laws and potential consequences were found to be lawful because “they either set forth the exact language of the applicable Federal regulations or merely accurately conveyed the possibility that a strike ‘could’ lead to the loss of student visas.” Indeed, all of the statements made by the University would have likely been lawful if the word “will” was simply replaced with the word “could” in the statement at issue. The University, however, did not have to litigate the lawfulness of the statement because the Union chose to withdraw its unfair labor practice charge, resulting in the matter being closed.

Ultimately, this case serves as a helpful reminder that employers must be mindful of its communications with employees during a union organizing campaign and, particularly, seek competent legal counsel prior to taking any action during such times. If not, employers could find themselves in violation of the Act, except likely not have the good fortune of having the complaint against it withdrawn.

Carlos A. Torrejon is a former NLRB Attorney and an associate in the firm’s Labor and Employment Department, resident in its Morristown office.

Graduate students at most private universities have been allowed to unionize since the 2016 decision of the NLRB in Columbia University.  This decision was controversial because the employee status of graduate students has flip-flopped over time, depending on whether members appointed by Democratic or Republican Presidents controlled the Board.  Since 2016, the makeup of the Board has shifted from a Democratic majority to Republican control.  While Democratic appointees generally support the notion that graduate students should be considered employees, Republican appointees do not.  Thus, it is highly likely that graduate students’ status before the eyes of the Board will change, if a University brings a challenge.

However, for Columbia University it is not that simple because the Board has already ruled on the merits of graduate student employee status, and it recently approved the election last December.  Columbia cannot simply ask the Board to reverse itself because the Board’s membership has changed.  Rather, Columbia must first refuse to bargain with the United Auto Workers Union (“UAW”), the representative of its graduate students, and rely on the UAW to file a refusal to bargain charge with the Board.  This Columbia has already done.  In a recent letter, Columbia notified the union that it will not bargain with the UAW regarding a first contract for Columbia’s graduate students.  The Board would then hear the matter, and likely conclude that Columbia did in fact violate the National Labor Relations Act (“the Act”) and order Columbia to bargain.   This in turn will permit Columbia to challenge the Board’s ruling that Columbia’s graduate students are employees under the Act before a United States Circuit Court of Appeals, presumably the D.C. Circuit.

The outcome of this looming appeal will cast a long shadow on graduate student organizing across the country.  If one of the parties to the appeal is unhappy with the result, the matter could reach the U.S. Supreme Court, which would settle this matter for good.

Regardless, how a U.S Court of Appeals decides the matter, expect the Trump Board to reverse course and once again find that graduate students are primarily students rather than employees and conclude that they are guaranteed the right to organize under the Act.

Andrew MacDonald is an associate in the firm’s Labor and Employment Department, resident in its Philadelphia office.

Chip Zuver is an associate in the firm’s Labor and Employment Department, resident in its Los Angeles office.

On February 2, 2018, a split three-member Board panel held that a prior election won by a union must be vacated and, accordingly, ordered a second election as it found merit to the employer’s objection arguing that the tardiness of the Board Agent conducting the election potentially disenfranchised a dispositive number of eligible voters.

In February 2017, employees at Bronx Lobster Place LLC voted in favor of unionization by a narrow margin of 14-12. There were 4 eligible voters that did not vote for unknown reasons but, significantly, the Board Agent running the election opened the second voting session 7 minutes after it was scheduled to begin. Notwithstanding the fact that none of the missing voters actually showed up during the Board Agent’s absence, the employer argued that this alone should be enough to set aside the election results. Indeed, the Regional Director, in adopting the Hearing Officer’s recommendation, relied on this fact – no eligible voters were actually prevented from voting due to the late opening of the polls – in certifying the election results.

But, contrary to the Regional Director and the lone dissenting (Democratic) Board member, the Board majority found that case law “rejects such an actual-disenfranchisement standard, in favor of a potential-disenfranchisement test.” Interestingly, one of the two Democratic Board members left on the panel from the Obama-era ruled in favor of undoing the election results and conducting a second election.

In the end, this Board decision reaffirms precedent dating back almost two decades by clearly articulating the applicable standard, and it is yet another example of a favorable decision for an employer under this new administration. This application is also consistent with frequent management-side requests for bright line rules that make it simpler for parties to operate under. Expect more of the same in the (somewhat) near future once the Board has a fully constituted five-member panel with a Republican majority. Stay tuned.

Carlos A. Torrejon is a former NLRB Attorney and an associate in the firm’s Labor and Employment Department, resident in its Morristown office.

On January 29, 2018, the DC Circuit remanded a 2016 NLRB decision – Grill Concepts Servs., Inc., 364 NLRB No. 36 (2016) back to the Board for reconsideration of several employee handbook violations found unlawful under the now-replaced Lutheran Heritage standard in light of the Board’s new standard recognized in Boeing Co., 365 NLRB No. 154 (2017).

As explained in a previous Alert, the prior standard considered work rules unlawful if employees would “reasonably construe” them to interfere with union or other protected concerted activity under Section 7 of the Act.  Until this past December, the Obama Board unreasonably interpreted and applied this decision for several years. That, however, changed in Boeing when the Board adopted a balancing approach that considers “the nature and extent of the potential impact” on Section 7 rights and the employer’s “legitimate justifications” for the rule.

Fast forward to this case and the DC Circuit has agreed to remand several work rules the Board previously found unlawful under the now-overruled “reasonably construe” standard.  These rules, contained in the restaurant’s employee handbook, include a “Team Member Relations/Positive Culture” rule requiring employees to interact respectfully with management, an “Online Communications” rule, and a “Team Member Conduct While Representing the Restaurant” rule (just to name a few). And while it is not unusual for a federal court of appeals to remand a matter back to an agency, especially when encountered with a change in policy by said agency, this situation should help instruct employers previously found to have unlawful work rules and currently in the midst of an appeals process.

This decision to remand will also allow the Board to give more guidance to employees and employers alike by actually applying the new standard to different facts and circumstances than those examined in the Boeing case. Yet, the clear guidance we all desire – but at times hardly get – can only happen when John Ring is confirmed by the Senate and gives the Board a 3-2 Republican-majority once again. Until then, any case taken up by a four-member Board evenly divided among party lines will likely end up deadlocked 2-2 and possibly constrain the application of the new Boeing standard.

Carlos A. Torrejon is a former NLRB Attorney and an associate in the firm’s Labor and Employment Department, resident in its Morristown office.

In PCC Structurals, Inc., the NLRB overruled its 2011 Specialty Healthcare decision, which allowed for unions to organize employees in so-called “micro-units.”  Now, the Board has returned to its traditional, multi-factor “community of interest” test.

The term “micro-unit” refers to a segment of employees that have been separated from a larger group of employees who share similar interests (based on compensation, hours, benefits, supervision, training and skills, interchange with other employees, etc.).  These “micro-units” have been criticized for creating unnecessary distinctions between similarly-situated employees.  Permitting employers to create units out of smaller  groups of employees can make it easier for unions to organize.Picketing Image

The Board traditionally reviewed, on a case-by-case basis, the “community of interests” between employees to determine whether a unit of eligible employees was “appropriate” for bargaining, per the language of the NLRA.  Pursuant to this review, the Board might determine that the “appropriate” unit mirrored the unit sought by the union in its petition, or, upon insistence by the employer, it might find that other employees sharing the same “community of interests” must be included in the unit.

In 2011, however, the then-majority of the Board imposed a new framework to determine unit appropriateness.  Under the Specialty Healthcare test, the Board first reviewed whether the union’s proposed unit was “readily identifiable as a group” (using factors of the “community of interests” test).  If the employer asserted that other employees should be included in the unit to make it “appropriate,” it was required to show that there was an “overwhelming community of interests” with other employees.

In overturning Specialty Healthcare, the Board majority in PCC Structurals found that the decision’s framework “detracts” from the statutory framework of the NLRA, which mandates that the Board decide whether a petitioned-for unit is “appropriate” for bargaining “in each case.”  More specifically, the Specialty Healthcare test failed to examine the “community of interests” of all employees, but instead focused just on those identified by the union in the representation petition.  Moreover, the Board found that the Specialty Healthcare framework led to an abdication of the Board’s responsibility to determine unit appropriateness by “giv[ing] all-but-conclusive deference to” the union’s desired bargaining unit.

For these reasons, the Board rejected Specialty Healthcare and re-imposed the case-by-case determination of the overall “community of interests” of employees when determining unit appropriateness.  Accordingly, we can all bid farewell to micro-units.

Andrew MacDonald is an associate in the firm’s Labor and Employment Department, resident in its Philadelphia office.

On January 12, 2018, President Trump nominated Morgan Lewis & Bockius partner John Ring to fill the last vacancy on the five-member Board and, if confirmed by the Senate, this will once again give Republicans a 3-2 majority on the panel after the departure of former Board Chairman Philip A. Miscimarra in December 2017. Mr. Ring, a career management-side attorney, will bring decades of skill and experience to the Board, and will help to restore balance to the NLRB after years of decisions that greatly favored unions and employees under the Obama Board. Indeed, this restoration to a neutral government agency already began during the last week of former Board Chairman Miscimarra’s term when significant labor-friendly decisions – e.g., joint-employer (Browning Ferris Industries), workplace rules (Lutheran Heritage), and micro-unit organizing (Specialty Healthcare) – were overturned.

Moving forward, employers will simply have to wait and see which other Obama-era policies will be invalidated. A few possibilities include employees having a presumptive right to use their employer’s email system to engage in Section 7 activities (Purple Communications), graduate students at private universities being deemed employees under the Act and thus allowed to unionize (Columbia University), and doing away with (or modifying) the ‘ambush’ or ‘quickie’ election rule enacted close to three (3) years ago. At this point, however, this wish list of decisions is just speculation as to what will happen down the road. That said, I am very optimistic further change is coming sooner rather than later.

Carlos A. Torrejon is a former NLRB Attorney and an associate in the firm’s Labor and Employment Department, resident in its Morristown office.

Hy-Brand Industrial Contractors – the recent Board case overturning Browning Ferris Industries and restoring the previous joint employer standard – was perhaps the most important decision among the many decided prior to former Board Chairman Miscimarra stepping down in late 2017; but the decision may not be as significant for all.

As explained in an earlier Alert, the Republican-controlled Board returned to the pre-BFI standard in place for decades and once again found that joint employer status depends on whether entities have “direct and immediate” control over employees’ terms and conditions. And, even though Browning Ferris Industries exposed corporations that franchise to greater legal liability by making it easier to find joint employer status, overturning this incredibly broad standard is less substantial for those employers who do not just sit on the sidelines and observe (reserved control) but who actually have direct and immediate control over the employment terms of another entity.

Primarily, Hy-Brand is a huge victory for business advocacy groups and employers of all sizes as it returns the joint employer standard to its logical place and abandons the nonsensical propositions put forth in Browning Ferris Industries. Additionally, since Hy-Brand applies retroactively to all pending cases regardless of stage in the proceedings, respondents involved in such matters can expect any evidence of indirect and reserved control that the NLRB may have against them to likely be moot and not bear any impact on the outcome.

Hy-Brand will also present the NLRB’s new General Counsel, Peter Robb, with a decision in terms of resources the Agency will allocate when cases purport to show a joint employer finding by relying more on reserved, non-exercised control evidence rather than direct and immediate control. Still, notwithstanding how the General Counsel decides to allocate Agency resources, one thing is certain: businesses – large, small, and in between – can rest a little more easily knowing several Obama-era policies are on their way out.

Carlos A. Torrejon is a former NLRB Attorney and an associate in the firm’s Labor and Employment Department, resident in its Morristown office.

The National Labor Relations Board has ruled that an employer does not necessarily violate the National Labor Relations Act by maintaining a facially neutral work rule, policy or handbook provision that could be reasonably construed to interfere with union or other protected concerted activity protected under Section 7.

The 3-2 decision in The Boeing Company, handed down on Dec. 14, overrules Lutheran Heritage Village-Livonia, in which the NLRB declined to consider the employer’s justification for a facially neutral rule or the extent the rule might burden Section 7 activity.

During the Obama administration, the NLRB routinely applied the Lutheran Heritage rule to invalidate facially neutral employer rules adopted and applied for legitimate business reasons unrelated to an employee’s Section 7 activity. Examples of Section 7 activity would include the employees’ right to unionize or discuss wages and working conditions.

Now, in The Boeing Company, the NLRB has added leeway for employers by holding that enforcement of a facially neutral rule will not be deemed unlawful simply because an employee could “reasonably construe” the rule to interfere with Section 7 activity. Rather, the NLRB will apply a balancing test that considers “the nature and potential impact of the rule” on Section 7 activity and the employer’s “legitimate justification” for the rule. The NLRB will evaluate the rule from the perspective of the employee.

Pursuant to this balancing, employer rules will fall into one of three categories.

Category I Rules – those the NLRB concludes are generally lawful to maintain either because (i) the rule “does not prohibit or interfere with the exercise of NLRA [Section 7] rights, or (ii) the potential adverse impact on protected rights is outweighed by justifications associated with the rule.” The NLRB provided two examples: a rule requiring employees to engage in “harmonious interactions and relationships necessary to comply with basic standards of civility” (basic civility rules), and the no-camera/photography policy at issue in The Boeing Company.

Category II Rules – those requiring scrutiny by the NLRB on a case-by-case basis to determine whether the rule’s adverse effect on Section 7 rights outweighs the employer’s legitimate justification for the rule. The NLRB declined to provide an example of such a rule.

Category III Rules – those the NLRB generally finds unlawful to maintain because the rule predictably has an adverse impact on Section 7 rights that outweighs any employer justification for the rule. Category III rules include those that prohibit employees from discussing their wages or benefits with one another.

Applying its new test, the NLRB concluded that Boeing’s facially neutral policy that restricts the use of camera-enabled devices on Boeing property was a lawful Category I rule. The NLRB noted that although the no-camera rule might in some circumstances potentially effect employees’ exercise of their Section 7 rights, this adverse impact was comparatively slight since the vast majority of pictures or images blocked would be unrelated to any protected activity.

Moreover, the NLRB concluded that the potential adverse impact on Section 7 activity was outweighed by Boeing’s business justifications for the no-camera rule. According to the NLRB, Boeing’s justification was especially compelling because the rule is necessary to maintain accreditation to perform classified work for the federal government, to comply with Boeing’s duty to prevent the disclosure of export-controlled materials to unauthorized persons, to protect proprietary information and to minimize the risk that personally identifiable employee information would be released. The NLRB said that it would likely find no-camera/photography rules lawful under category I even with less compelling business justifications.

Employers are now able to lawfully implement and maintain facially neutral work rules that have the potential to interfere with Section 7 activity so long as the rule has a direct and immediate relationship to the employer’s business and enforcement of the rule is unlikely to have much effect on Section 7 rights.  Even with category I rules, the devil is in the details. One employer’s  no-camera rule might be lawful while another’s might not, depending on the language of the rule, the justification for the rule and the circumstances in which the rule was implemented.

A recent Memorandum from Peter B. Robb, the NLRB’s newly installed General Counsel, reminded me of a stanza from Lewis Carroll’s The Walrus and The Carpenter. To paraphrase: “The time has come” the GC said, “To talk of many things: Of handbook rules and Weingarten, of email use and salt-ings.” Though perhaps not as prosaic, the GC’s December 1 Memorandum presages his intent to take Board law back through the looking glass and review all issues overruled by the Obama Board.

The Memo – which new GCs typically issue at the start of their terms – mandates that all Regional Offices seek guidance from Advice before issuing complaints on “significant legal issues,” shorthand for subjects about which the Board overruled precedent during the last eight years. This appears to be the GC’s way of putting the brakes on the application of Obama Board precedents that have been widely viewed as overreaching.

Just in time for the holidays, the GC’s Memo recites is an employer’s wish list of Board rulings to be overturned or revisited:

  • A presumptive right of employees to use employer email systems for Section 7 activities;
  • Employer handbook rules found be unlawful that barred “disrespectful” conduct, use of employer intellectual property, and workplace recording;
  • Finding protected activity was concerted where only one employee had a stake in the outcome, or where the activity involved obscene or vulgar conduct;
  • Broad expansion of the Weingarten right;
  • Joint employer and successorship issues;
  • An employer duty to provide witness statement to unions;
  • And so much more!

Besides identifying issues of focus for potential complaints, the Memo also immediately withdraws a number of prior GC memoranda. Most notably, the GC has withdrawn GC Memo 15-04, “Report of the General Counsel Concerning Employer Rules,” which vexed many employers who scrambled to review and revise their seemingly innocuous handbooks in an often vain attempt to ensure that employees could not reasonably construe them in a way that would chill their NLRA-protected activity.

Finally, the Memo also halted initiatives of the prior administration, such as application of the Weingarten doctrine to non-union workplaces, and an effort to shift the burden of proof in cases involving back pay for salts.

A full analysis of the Memo and its potential implications – both immediate and in the future – is beyond the scope of this post. However, the Memo confirms the expectations of employers, unions and advocates on both sides: the pendulum is on the backswing and the Board is eager to correct the imbalance created over the past eight years.

Justin Schwam is an associate in the firm’s Labor and Employment Department, resident in its Morristown office.

Recently, a majority of employees at the news websites DNAinfo and Gothamist decided to join the Writer’s Guild union to bargain collectively over their terms of employment. In response, the owner of the websites decided to shut down its operations completely. This begs the question: can a business close its doors in response to its employees voting to join a union? Perhaps surprisingly, the answer to that question is, with few exceptions, yes.

Picketing Image

In general, the National Labor Relations Act prevents businesses from retaliating against employees for engaging in protected activities, including voting to join a union. However, the United States Supreme Court held in 1965 that closing a business in response to union activity is “not the type of discrimination which is prohibited by the Act.” Textile Workers v. Darlington Mfg. Co., 380 U.S. 263 (1965). In Darlington, the Court essentially found that the law

does not reach the act of purposefully liquidating a business because restraining a business from taking such an action was too “startling … [to] entertain.” Fundamentally, the rule announced in Darlington is premised on the rationale that an employer that leaves the sphere of business entirely does not gain any advantage by shedding union-represented employees. While this rule may sound odd, given that employers cannot discriminate against employees for their union activities, the law simply does not prevent an employer from going out of business, even when the closing is based solely on anti-union sentiment.

As is usually the case, there are exceptions to this rule. An employer cannot close a facility due to union activity in order to inhibit unionization at other plants. One can imagine a situation where a non-union employer with multiple facilities closes the first plant to unionize in order to make a statement to all of its employees. Where a decision to close is based on anti-union animus and aimed at employees at other locations, such a closing will be deemed to be unlawful.

All that being said, the closing of a business only provides a union with limited grounds to contest a closing as unlawful. In this case of DNAinfo and Gothamist, the Writers Guild most likely need to limit any claims at the NLRB to that theory.

Andrew MacDonald is an associate in the firm’s Labor and Employment Department, resident in its Philadelphia office.