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© 2014 Winston & Strawn LLP
The “Mount Everest of Regulations”– Examining the NLRB’s
New “Quickie Election” Rules
Derek G. Barella William G. Miossi Joseph J. Torres
Winston & Strawn LLP
December 19, 2014
© 2014 Winston & Strawn LLP
Today’s eLunch Presenters
Derek Barella Partner Chicago
+1 (312) 558-8002
Joseph Torres Partner Chicago
+1 (312) 558-7334
Bill Miossi Partner
Washington, D.C.
+1 (202) 282-5708
2
© 2014 Winston & Strawn LLP
Agenda
• Quick overview of NLRB and its election process • Review NLRB’s new “quickie election” rules • Planning recommendations • Two related NLRB case law developments
• Employee access to work email for organizing purposes • Union’s ability to organize “micro-units”
• Additional planning recommendations
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© 2014 Winston & Strawn LLP
NLRB and Its Election Process
© 2014 Winston & Strawn LLP
National Labor Relations Board – Overview
• Agency responsible for the National Labor Relations Act • Handles election (“R”) cases and ULP (“C”) cases
• Initially processed by Regional Offices • Board has ultimate decision/policy authority
• Board itself has five members (including one Chairperson) • Presidential appointees • If confirmed, serve five-year terms
• By tradition, three from President’s party, two from other party • Current Board is considered favorable to organized labor
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© 2014 Winston & Strawn LLP
NLRB Election Process – Overview
• Can be initiated by employees or a labor union • Employees show support by, e.g., signing petition or authorization
cards • Must involve a defined “unit” (e.g., all janitors, all store employees) • Need at least 30% of employees in proposed unit to signify support
• Unions likely won’t proceed unless they have greater than 50% support
• Process starts by filing a petition to hold election • Unless there are legal problems with proposed unit, election will be set • Currently, average time between petition and election is 38 days • Employers have right to express their opposition and opinions • Union must secure 50% plus one of employees who vote
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© 2014 Winston & Strawn LLP
NLRB Election Process – Overview (cont’d)
• Two other notable points to keep in mind • No limit on how long employees/union can “campaign” before filing
• No requirement that employees/union announce their pre-petition activity
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© 2014 Winston & Strawn LLP
Holidays Come Early for Organized Labor
• Long-anticipated wish list items are delivered • Big ticket item
• Changes to rules and procedures for representation elections
• Stocking stuffer • Purple Communications – employees have Section 7 right to
use work email for non-business purposes, including union organizing
• Accessory gift that keeps on giving • Ability to organize “micro-units”
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© 2014 Winston & Strawn LLP
Why So Important to Labor?
• Union membership stagnant • Total union membership density: 11.3% • Private sector: 6.7%
• Union election win rates hover around 50% • But, ROI is low
• Many more petitions filed than elections held • Time and resources are significant commitments
• To drive membership/dues gains, labor needed a boost
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© 2014 Winston & Strawn LLP
“Quickie Election” Rules
© 2014 Winston & Strawn LLP
NLRB Election Rules
• June 2011: NLRB first proposes rules changes • November 2011: NLRB votes to adopt rules changes
• Chairman Pearce and then member Becker vote “aye” • Member Hayes declines to vote or take any action
• May 2012: D.C. District Court invalidates rules changes • Board lacked a properly constituted quorum
• February 2014: NLRB re-issues rules changes • No further action through mid-term elections
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© 2014 Winston & Strawn LLP
NLRB Election Rules (cont’d)
• Dec. 12, 2014: Divided Board adopts new rules • Chairman Pearce, members Hirozawa and Schiffer majority • Members Miscimarra and Johnson dissent
• Rules changes are effective April 14, 2015
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© 2014 Winston & Strawn LLP
What’s Changed?
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Current New
• Parties cannot file petitions electronically
• Regions do not electronically transmit certain R Case documents
• Election petitions, notices, and voter lists can be transmitted electronically
• Regions transmit case documents electronically
• Notice of Election is posted in facility after
• RD directs election; or • Approves stipulated election
agreement
• Employer must post Notice of Election within two business days of Region’s service of petition before
• Unit issues are raised or resolved
© 2014 Winston & Strawn LLP
What’s Changed?
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Current New
• Pre-election hearings typically scheduled within week to ten days from petition
• Region sets pre-election hearing to begin eight days after notice served with petition, and
• Post-election hearing 14 days after filing of objections
• No pre-hearing filing requirements • Non-petitioning party must identify any/all issues in statement of position
• Must be filed one day before hearing
• Issues not raised are waived
© 2014 Winston & Strawn LLP
What’s Changed?
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Current New
• Employer must provide prospective voter list after RD directs election or approves stipulated election agreement
• Employer must provide prospective voter list with job classifications, shifts, and work locations, to Region and other parties with its pre-hearing statement of position, before unit issues are raised/resolved
• Pre-election hearing addresses issues and disputes concerning scope of proposed unit and voter eligibility
• Pre-election hearings limited to only fundamental questions concerning NLRB jurisdiction and whether election bar exists
• Most issues concerning unit and voter eligibility are “deferred” to post-election proceedings
© 2014 Winston & Strawn LLP
What’s Changed?
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Current New
• Parties have right to file post-hearing briefs within seven days of hearing, with permissive extensions
• Oral argument allowed before close of hearing
• No post-hearing briefs unless RD determines they are necessary
• RD schedules election 25-30 days after decision and direction of election to allow filing of request for review with NLRB
• 25-30 day scheduling parameter is eliminated
• Most requests for NLRB review of RD decisions are “deferred” to post-election
© 2014 Winston & Strawn LLP
What’s Changed?
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Current New
• Employer must provide Excelsior voter list with names and home addresses
• Due seven days after RD decision or approval of stipulated election agreement
• Employer must provide Excelsior voter list with names, home addresses, personal phone numbers, and personal email addresses (if available)
• Due two days after RD decision or approval of stipulated election agreement
• Board required to review every aspect of most post-election disputes
• Board’s review of post-election disputes is more limited and subject to discretion
© 2014 Winston & Strawn LLP
Practical Impact of the New Rules
Petition RD Decision and Direction of Election
Election
Pre-election hearing and unit issues Opportunities to seek NLRB review
Median 38 days — Maximum 42 days
Petition DDE Election
Limited hearing and unit issues
14-21 days (likely)
Limited opportunity for NLRB review
Current
New
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© 2014 Winston & Strawn LLP
Practical Impact of the New Rules
Petition DDE Election
Limited hearing
14-21 days (likely)
Union campaign likely ongoing for 6+ months
Limited opportunity for NLRB review
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© 2014 Winston & Strawn LLP
What’s Next?
• Legal challenges likely • Focus on claimed due process/First Amendment flaws in
rules
• Grounds for prior invalidation by D.C.D.C. have been cured
• Member Schiffer off/Member McFerran on – unlikely shift in Board position or agenda in near future
• Employers should prepare for life under the new rules
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© 2014 Winston & Strawn LLP
Recommendations
• Labor relations strategy must become even more proactive vs. reactive
• The best counter-campaign is a sustained employee engagement effort • Principal focus should be on positive aspects of workplace • Not the negatives of having union
• Cannot begin when the petition is filed • Too little, too late
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© 2014 Winston & Strawn LLP
Recommendations (cont’d)
• Candidly assess your position on unionization • What is our labor relations philosophy and policy? • What is senior management’s awareness of risks? • What is their commitment level? • What resources is the organization prepared to dedicate to:
• Sustained employee engagement • Development and execution of game plan for responding to
organizing effort
• Who is responsible for executing organization’s plan? • Pace of election will make sustained “pondering” challenging
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© 2014 Winston & Strawn LLP
Recommendations (cont’d)
• Candidly assess your organization’s strengths and risks • How effectively do you measure employee satisfaction? • How effectively do you address risks that are identified? • How effective is your management team in sustained engagement? • How effective do you track external pressures?
• Organizing activity in peer/geographically-proximate companies
• Market terms and conditions of employment
• How effective and sustained are your training efforts? • Positive employee relations and engagement
• Recognizing signs of organizing
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© 2014 Winston & Strawn LLP
Recommendations (cont’d)
• Develop a plan for moving forward • Risk assessment: baseline and going forward • Action items for addressing identified risks • Evaluate existing training and hiring programs
• Consider role of counsel to establish, maintain privilege where appropriate
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© 2014 Winston & Strawn LLP
Other Notable Developments
© 2014 Winston & Strawn LLP
Purple Communications, Inc.
• Employees have “presumptive” right to use employer’s email for protected communication (including union organizing) during nonworking time
• So, two options to eliminate employees’ new “right”: • Don’t give access to email, at all; or • Rebut presumption by establishing undefined “special
circumstances” • Total ban: unlikely, the “rare case” • Controls over email systems: must be uniform, consistently
enforced, necessary to maintain production and discipline
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© 2014 Winston & Strawn LLP
Micro-Units
• Specialty Healthcare, 357 NLRB No. 83 (2011) • A union’s petitioned-for bargaining unit should be upheld
• To overcome, employer must show another group shares an “overwhelming” community of interests with the proposed bargaining unit
• Macy’s Inc., 361 NLRB No. 4 (July 22, 2014) • Proposed unit was appropriate
• Board rejected arguments based on common employment terms and proximity
• Neiman Marcus Grp., 361 NLRB No. 11 (July 28, 2014) • Board rejected proposed unit
• Proposed unit did not follow existing “administrative or operational lines”
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© 2014 Winston & Strawn LLP
Recommendations
• E-mail usage • Evaluate your current solicitation/distribution policy to ensure
compliance • Evaluate your current monitoring efforts
• Micro-units • Assess where your organization might be vulnerable to such
efforts • Consider appropriate steps to mitigate possible risks
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© 2014 Winston & Strawn LLP
Questions?
© 2014 Winston & Strawn LLP
Thank You.
Derek Barella Partner Chicago
+1 (312) 558-8002
Joseph Torres Partner Chicago
+1 (312) 558-7334
Bill Miossi Partner
Washington, D.C.
+1 (202) 282-5708
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