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The U.S. Federal Government’s Attempt to
Strengthen the Power of Unions –
and Why You Should Care
Wednesday, July 20, 2011
Presenters
Moderator
Louis P. DiLorenzo, Partner, Bond
Schoeneck & King LLLP, Syracuse, NY
2
Speakers
Leonard Court, Director, Crowe & Dunlevy,
Oklahoma City, OK
Charles S. Einsiedler, Jr., Partner,
Pierce Atwood LLP, Portsmouth, NH
3
Speakers
4
Robin H. Kobayashi, Of Counsel,
Alston, Hunt, Floyd, & Ing, Honolulu, HI
Bryan M. Seiler, Associate, Gray Plant
Mooty, Minneapolis, MN
What Is Really Going on in
Washington?
• Organized Labor’s Support for President
Obama
• Promise of EFCA
• The Great Recession and then the mid-
term elections and Republican Control
of the House
• Plan B, administrative changes by the
NLRB and the DOL
• Four new members at the NLRB5
What’s Really Going on at the NLRB?
Final Hail Mary Pass
• Wilma Liebman (D): 8/27/2011
• Craig Becker (D): End of December 2011
• Mark Gaston Pearce (D): August 27, 2013
• Brian Hayes (R): December 16, 2012
• Terry Flynn (R): nominated and likely
confirmed
6
The Boeing Unfair Labor Practice
Boeing announced in 2007 that it
planned to assemble seven 787
airliners per month in its unionized
facilities in Washington State
7
The Boeing Unfair Labor Practice
The company later said that it would
create a second production line, in
South Carolina – a right to work state
– to assemble an additional three
planes per month to address a
growing backlog of orders. In October
2009, Boeing announced that it would
locate that second line at the non-
union facility.8
The Boeing Unfair Labor Practice
In repeated statements to employees
and the media, Boeing executives
cited the unionized employees’ past
strike activity and the possibility of
strikes occurring sometime in the
future as an overriding factor in
deciding to locate the second line in
the non-union facility.
9
The Boeing Unfair Labor Practice
On March 26, 2010, the International
Association of Machinists and
Aerospace Workers filed a charge with
the NLRB alleging that the Boeing
Company had engaged in multiple
unfair labor practices related to its
decision to place a second production
line for the 787 Dreamliner airplane in
a non-union facility. 10
The Boeing Unfair Labor Practice
The union charged that:
• The decision to transfer the line was
made to retaliate against union
employees for participating in past
strikes and to chill future strike activity.
• Boeing failed to negotiate over the
decision to transfer the production line.
11
Lessons Learned
1. Facilities can be moved to other
locations for a variety of reasons –
but not to avoid an existing union.
2. Be careful what you say!!!
12
“Leveling” the Playing Field
Overview of Labor-Management
Reporting and Disclosure Act of 1959
(“LMRDA”), 29 U.S.C. §433
• Requires “consultants” who undertake to
persuade employees to organize and
bargain collectively to “report and
disclose” their fees
• Employers who hire “persuaders” also
required to report and disclose
13
“Leveling” the Playing Field
Overview of Labor-Management
Reporting and Disclosure Act of 1959
(“LMRDA”), 29 U.S.C. §433 (cont’d)
• Statute enforced by U.S. Department of
Labor, Office of Labor-Management
Standards (“OLMS”)
• Civil and criminal penalties
14
Definition of “Persuader” Activity
OLMS – Proposed Regulations
Dramatically Expanding Regulatory
Definition of “Persuader” Activity
• Proposed Rules Published June 21, 2011 in
Federal Register: http://www.dol.gov/olms/regs/compliance/ecr_nprm.htm
• Accelerated rulemaking proposed – comment
period ends August 22, 2011
• If adopted, would change interpretations in
place for almost 50 years15
Definition of “Persuader” Activity
“Persuader” Activity Is Broadly Defined
by Statute as Any Agreement Where the
Object Is to:
• “Persuade employees to exercise or
not to exercise or persuade employees
as to manner of exercising, the right to
organize and bargain collectively”
16
Definition of “Persuader” Activity
• However, “advice exception” found in
Section 203 (c) of the LMRDA
provides that:
− “[n]othing in Section 203 shall be
construed to require any person to file a
report…by reason of his giving or agreeing
to give advice”
17
Advice Exception
Currently Applies to Work that Had Both
“Advice” and “Persuader” Components
• Review and editing of employer draft of
speech to employees deemed “advice”
• Preparation of speech to be delivered by
company official deemed “advice”
• For written materials, if employer can
reject or accept drafts, “advice” exception
applies18
Advice Exception
Currently Applies to Work that Had Both
“Advice” and “Persuader” Components
• Material prepared AND delivered by
consultant or lawyer is “persuader” activity
• Bright line: Persuader activity is direct
communication with employees by lawyer
or consultant
19
New Definition of Persuader Activities
• Drafting, revising, or providing written
materials for presentation, dissemination,
or distribution to employees
• Drafting, revising, or providing a speech
for presentation to employees
• Drafting, revising, or providing audiovisual
or multi-media presentations for
presentation, dissemination, or
distribution to employees
20
New Definition of Persuader Activities
• Drafting, revising, or providing website
content to employees
• Planning or conducting individual or
group employee meetings
• Developing or administering employee
attitude surveys concerning union
awareness, sympathy, or proneness
21
New Definition of Persuader Activities
• Training supervisors or employer
representatives to conduct individual
or group employee meetings
• Coordinating or directing the activities
of supervisors or employer
representatives
• Establishing or facilitating employee
committees
22
New Definition of Persuader Activities
• Developing personnel policies or
practices
• Deciding which employees to target for
persuader activity or disciplinary action
• Conducting a seminar for supervisors
or employer representatives
• Other
23
New Definition of Information
Supplying Activities
Supplying Information Obtained from:
• Research or investigation concerning
employees or labor organizations
• Supervisors or employer representatives
• Employees, employee representatives, or
union meetings
• Surveillance of employees or union
representatives (video, audio, Internet, or in
person)
• Other24
Reporting Requirement is Very Broad
If Engaged in “Persuader Activities,”
Must Report:
• Fee arrangement for Persuader
Activities
• All receipts from all employers
regarding “labor relations advice”
See Form LM-21
25
NLRB Proposed Rule-Making
Overview
• NLRB Proposed Rulemaking Changes
• What’s Really Going on at the Board?
• How to Voice Concerns
26
Major Proposed Changes
• Eliminate pre-election request for review
• Require pre-election hearing 7 days after hearing notice
• Require post-election hearing 14 days after ballots have been tallied
• Mandate parties to state position at the start of hearing before evidence is accepted
27
Major Proposed Changes
• Defer pre-election resolution of voter eligibility
to election. Litigation of eligibility issues
raised by parties involving less than 20% of
BU would be deferred until post-election
• Requires employers to create preliminary
voter list, including names, work location,
shift, and classification. Due by opening of
pre-election hearing
• Allow electronic submission of election-
related documents
28
Major Proposed Changes
• Eliminate pre-election review of RD’s ruling
• Eliminate automatic right for an appeal of post-election rulings by Regional Directors
• Include phone numbers & email on final voter list
• Require production of final voter list within two work days (and allow electronic transmission)
29
Voice Concerns over Proposed Rules
• NLRB currently accepting comments
• Deadline: 60 days from June 22, 2011
• Submit comments to:
www.regulations.gov
30
Practical Effect of “Quickie” Elections
According to the Board, the New
Rules Will:
• Increase efficiency in notice and filing
processes, allowing for expanded use
of electronic systems
• Reduce pre-election jockeying that
results in unnecessary delays in
elections
31
Practical Effect of “Quickie” Elections
However, the New Rules Also:
• Impose swift timetables that many
employers will be ill equipped to meet
• Effectively prevent parties from litigating
legitimate representation questions before
the election
• Drastically decrease the time for
employers to explain their position on the
issues that led to filing the petition
32
The Heart of the Problem
“In truth, the “problem” which my
colleagues seek to address through
these rule revisions is not that the
representation election process generally
takes too long. It is that unions are not
winning more elections.”
Member Hayes, Dissenting
33
A Preview of Coming Attractions
• Member Hayes points to the academic
origins of the proposed rules and
suggests that this NPRM may be the
first of many to come.
34
A Preview of Coming Attractions
• Member Hayes describes similar
proposals that could be implemented
in the future:
– Requirements that employers provide union
access to employees at the workplace
– Conduct elections off-site, including by mail or
electronic ballot
– The Board’s willingness (announced in
Specialty Healthcare) to entertain petitions for
narrow and previously unrecognized
bargaining units35
Facebook Firings: The Basics
• The NLRA protects an employee’s
right to engage in “concerted activities
for the purpose of collective bargaining
or other mutual aid or protection”
(Section 7 rights)
• Section 7 is not limited to employers
facing union organizing efforts – it
applies to all employees covered by
the Act36
Employer Policies and
Employees’ Section 7 Rights
• The standard: whether the rule or
policy “would reasonably tend to chill
employees in the exercise of their
Section 7 rights.”
• Employers can violate the NLRA by:
– Maintaining a policy that employees would
reasonably construe to prohibit Section 7
activity
37
Employer Policies and
Employees’ Section 7 Rights
• Cont’d:
– Promulgating a policy in response to union
activity or
– Applying a policy to restrict Section 7
rights
38
Notable Complaints (So Far)
• American Medical Response of
Connecticut, Inc., Case No. 34-CA-12576
(Oct. 27, 2010)
• Student Transportation of America, Case
No. 34-CA-12906 (Feb. 4, 2011)
• Hispanics United of Buffalo, Inc.,Case No.
3-CA-27872 (May 9, 2011)
• Knauz BMW, Case No. 13-CA-46452
(May 20, 2011)39
So What’s the Big Deal?
• Permanence of electronic
communication
• Precision required not just in discipline
and discharge, but also in both the
timing and substance of written
policies
• Applies to employees in non-unionized
workplaces, as well as unionized
workplaces40
NLRB Policy on Social Media Cases
In Memorandum GC 11-11 (Apr. 12, 2011),
the NLRB’s Acting General Counsel
announced that Regional Directors must
submit cases involving “rules prohibiting, or
discipline of employees for engaging in,
protected concerted activity using social
media, such as Facebook or Twitter” to the
Division of Advice for a decision.
41
A Cautionary Tone:
The Division of Advice Memoranda
• Advice Memorandum, Sears Holdings
(Roebucks), Case No. 18 CA-19081
(Dec. 4, 2009)
• Advice Memorandum, Arizona Daily
Star, Case No. 28-CA-23267 (April 21,
2011)
42
What Does this All Mean?
• Unionized and non-unionized
employers must make sure that their
policies and practices do not restrict
employees’ Section 7 rights.
• Employers that do not plan ahead in
this area risk becoming the Board’s
next test case!
43
10 Things You Can Do Now as an
Employer to Prepare for the Labor
Law Changes
1. Get “buy in” from top management if
remaining union-free is a key priority
2. Do the “easy stuff” now before the union
organizer shows up:
– Employee handbook change
– Update your no-solicitation rule
– Purge your employment policies of unfair labor
practices waiting to happen (no griping” and no
disparagement rules; prohibition on discussing
wages; improper social media policies, etc.)44
10 Things You Can Do Now as an
Employer to Prepare for the Labor
Law Changes
3. Invest in your Best Union Free Asset:
supervisor training in good HR policies and
practices which make unions unnecessary
4. Consider talking to your employees about
unions before the union organizer shows up
(union-free policy statement; discussions with
new employees during orientation; regular
refresher sessions with current employees on
the value of being non-union)45
10 Things You Can Do Now as an
Employer to Prepare for the Labor
Law Changes
5. Evaluate your hiring procedures to avoid
“salts”
6. Develop job description and organizational
changes to protect the supervisory,
confidential, temporary status of your
employees
7. Prepare your “appropriate voting unit”
argument
46
10 Things You Can Do Now as an
Employer to Prepare for the Labor
Law Changes
8. Develop a response team and a counter
campaign agenda in the event of card
signing or activity
9. Keep your wages and benefits competitive
with union contracts in your industry and
area
10.Give your employees a real “voice” and
communicate with them
47
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