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NLRB Uses Hyper-Technical Rule to Overturn Employer’s Landslide Election Victory

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As we previously reported, the ambush election rules implemented by the National Labor Relations Board (“Board”) last year tilted the scales of union elections in labor’s favor by expediting the election process and eliminating many of the steps employers have relied upon to protect their rights and those of employees who may not want a union. We warned that in addition to rapidly expediting election timeframe, the regulations were full of technical and burdensome procedural mandates on employers.  The Board further emphasized the pro-union impact of these requirements in a Decision last week when it overturned the results of an election that a union overwhelming lost based on a hyper-technicality.  Even though there was no prejudice to the union, the Board gave the union another bite at the apple despite the employees’ resounding rejection of union representation; effectively denying the employees their voice and imposing even more burdens on the employer.

New Regulations require service of Excelsior List on union

Section 102.62(d) of the Board’s New Rules and Regulations provides that an employer “shall provide to the regional director and the parties…a list of the full names [and other information] of all eligible voters… within 2 business days after the approval” of the Stipulated Election Agreement. This list of eligible voters is commonly referred to as an “Excelsior list.”   Section 102.62(d) further provides that the Employer’s failure to follow these procedural mandates “shall be grounds for setting aside the election whenever proper and timely objections are filed.”

The Petition and Election at issue

On Thursday, March 3, 2016, URS Federal Services, Inc. (“Employer”) and the International Association of Machinists and Aerospace Works, District Lodge 725 (“Union”) entered into a Stipulated Election Agreement. The Employer filed the list of eligible voters, commonly referred to as an “Excelsior list,” with the Region on Saturday, March 5, but failed to serve the list on the Union.  While the Board’s Decision noted the Employer never offered any explanation for its oversight, the fact is that under the prior regulations an employer need only file the list with the Region; the requirement to serve the union is new.  While the Employer did not directly send it, the Region forwarded the list to the Union on Monday, March 7, thus the Union timely received the list within two business days of the approval of the Stipulated Election Agreement.

The Union lost the election 91 to 54. After its crushing defeat, the Union filed objections, seeking to overturn the election because of the Employer’s deficient service, even though it had timely received the list and never complained of service issue before.

Regional Director finds no harm, no foul

The Acting Regional Director for Region 20 acknowledged that the Employer failed to serve the Union, but declined to set the election aside because the Union had suffered no prejudice since it received the list within two business days of the approval of the Stipulated Election Agreement as required by the Election Rules. The Regional Director explained that “[t]o hold otherwise would exalt form over substance.”  Relying on well-established Board precedent, the Regional Director also concluded that the employer’s technical violation did not frustrate the purpose of the Excelsior rule, which was to ensure that employees are provided a “full opportunity to be informed of the arguments concerning representation.” Bon Appetit Management Co., 334 NLRB 1042, 1043 (2001).

Board puts form over substance to favor Union

The Board rejected the Regional Director’s decision, reasoning that “[t]o allow parties to ignore the service requirements set forth in Section 102.62(d) without any explanation or excuse would undermine the purpose of those provisions.” The Board never articulated what purpose it was referring to, other than to insinuate that strict enforcement was necessary to ensure “all parties take their obligations seriously under the amended Rules.”  (italics in original).  Notably, the primary purpose of the service requirements – to ensure employees are fully apprised of the arguments concerning representation – had not been undermined since the Union timely received the list from the Region.

Dissent detail Board’s pro-union hypocrisy

As dissenting Board Member Philip A. Miscimarra (“Miscimarra”) explained, the Board’s decision is troubling for several reasons. Not only does the holding elevate form over substance, but it contravenes longstanding precedent that the Board should not overturn election results lightly “unless presented with clear evidence that the results may not reflect the will of the voters.”  In furtherance of this principle, the Board has previously declined to overturn elections despite allegations of death threats or widespread voter fraud.  In stark contrast, the Board here accepted the Union’s contention that a “purely technical violation of a service requirement, timely cured by the Region, warrants overturning election results that overwhelmingly disfavored” the Union.

Equally, and perhaps more, concerning is that the Board has effectively created a double standard for unions and employers. In Brunswick Bowling Products, LLC, 364 NLRB No. 96 (2016), a decision issued a mere three months earlier, the Board unanimously upheld the Regional Director’s decision to excuse the union’s untimely service of its Statement of Position.  As Miscimarra aptly pointed out, although the Board has long tolerated minor deviations from the Excelsior list requirements, no such “history of leniency” exists with respect to the service requirements for Statements of Position.   Yet, when a union violated the historically inflexible service requirements for Statements of Position, the Board excused the union’s noncompliance, but refused to do the same for an employer who failed to comply with rules that have traditionally permitted slight deviations, “even though the service error could not have affected the election results because the Union received the voter list on the same day it would have received the list had no service error been committed.”

Employers are advised to continue to adhere to Obama Board’s Regulations and Decisions

During the last eight years, the Obama Board has overturned longstanding Board precedent and expanded the rights of unions far and wide. Many employers may anticipate some relief from the onerous burdens imposed by the Board during the last eight years as a new administration comes to DC.  However, this case is a sober reminder that the Board intends to enforce the rules it has promulgated during the last eight years, and employers cannot afford to become lax in their obligations under these rules and must remember the Decisions rendered remain the standards to which they will be held.