Management Memo

After a flurry of pro-employee National Labor Relations Board (“NLRB”) decisions, the Fifth Circuit gave employers a glimmer of hope, rejecting the Board’s recent rule issued in Tesla, Inc., 371 NLRB No. 131 (2022) that effectively put every employer’s appearance, dress code and uniform policy in jeopardy of violating Board law if it could be read to limit employees’ ability to wear union apparel or insignia in any way unless the employer is able to meet the high burden of demonstrating that “special circumstances” existed to justify the policy.

The Tesla, Inc ...

On September 6, 2023, Governor Kathy Hochul signed into law Senate Bill 4982 and Assembly Bill 6604, which amends Section 201-D of the New York Labor Law to prohibit most employers from requiring non-managerial and non-supervisory employees to attend employer-sponsored meetings where the primary purpose is to communicate the employer’s opinions on religious or political matters. The amendment took immediate effect and makes New York the latest state to ban so-called “captive audience meetings,” following the National Labor Relations Board (NLRB) General Counsel’s ...

The United States Department of Labor Office of Labor-Management Standards (“OLMS”) recently signaled an alarming willingness to use its broad subpoena powers under Section 601 of the Labor-Management Reporting and Disclosure Act of 1959, as amended, 29 U.S.C. § 521 (“LMRDA” or “Act”), to examine records of explicitly lawful conduct by employers whose employees may be seeking to unionize. This effort maybe a precursor to OLMS’s plan to significantly expand employer reporting and disclosure obligations under Section 203 of the Act which requires employers and ...

On October 26, 2023, the National Labor Relations Board (NLRB or “Board”) issued its Final Rule (the “Rule”) on Joint-Employer status under the National Labor Relations Act (NLRA). Slated to take effect on December 26, 2023, the Rule returns to and expands on the Obama era Browning-Ferris test, scrapping the NLRB’s 2020 Joint Employer test for the sole reason that the current Board disagrees with the 2020 test, and setting up a potential showdown with the Supreme Court over the “major questions” doctrine and the scope of the NLRB’s administrative authority.

The ...

It has been a decision-packed summer at the National Labor Relations Board (“NLRB” or “Board”), and the last weeks of summer were especially active, with a number of significant decisions released at the end of August that could affect employers with non-unionized as well as unionized workforces. The following is a roundup of significant developments, in order of recency:

Board Membership Update: Member Wilcox Confirmed for a Second Term – One Vacancy Remains

On Wednesday, September 6, 2023, the Senate confirmed President Biden’s nomination of Gwynne Wilcox for a ...

The National Labor Relations Board (“Board”) published its final rule (“2023 Rule”) on Friday, August 25, amending the representation election procedures that it previously proposed in 2019 and finalized, after some additional revisions, in 2020 (“2019 Rule”).  Recall that the 2019 Rule had already experienced a significant setback earlier this year.  In January 2023, the D.C. Circuit vacated three substantive changes that the 2019 Rule would have made to the election procedures adopted by the Board in 2014 (“2014 Rule”) while keeping the ...

On August 2, 2023, the National Labor Relations Board (“NLRB” or “Board”) announced a long-anticipated Decision that will affect how employers craft, apply and enforce workplace policies in almost all workplaces, regardless of whether employees are represented by a union. As we anticipated several years ago, the current Board, with a majority of members nominated by President Biden, has now rejected the agency’s 2017 decision in The Boeing Company, in which it adopted a balancing test to evaluate facially neutral employer rules and handbook provisions by examining the nature and extent of their potential impact on employee rights under the National Labor Relations Act (“NLRA” or the “Act”) against legitimate justification(s) for the policies.

The majority opinion in Stericycle Inc. substantively revives the NLRB’s stance on workplace rules as established in the 2004 Lutheran Heritage decision.Under this new framework, any employer’s rule, policy, or handbook provision that  has a “reasonable tendency to chill employees from exercising their Section 7 rights” may be deemed to constitute an unfair labor practice and to be unlawful in violation of the NLRA.

Shocking few NLRB observers, the National Labor Relations Board (NLRB), in The Atlanta Opera, Inc., Case 10-RC-276292, a 3-1 decision issued June 13, 2023, announced its modified standard for analyzing whether  workers are employees or independent contractors of an employer, returning to the test last articulated by the Obama era Board in FedEx II, 362 NLRB 610 (2014), and overruling the Trump era SuperShuttle DFW, Inc., 367 NLRB No. 75 (2019). The new standard is likely to result in findings that more workers unions are seeking to organize and represent are employees and not independent contractors which they would have been found to be under SuperShuttle.

Management-side attorneys and the businesses that they represent will be pleased with the Supreme Court’s holding in Glacier Northwest, Inc. v. International Brotherhood of Teamsters.

The case concerned the issue of whether the National Labor Relations Act, 29 U.S.C. §§ 151–169 (“NLRA” or the “Act”), preempted a state tort claim seeking damages for harm suffered by their employer, caused by employees’ inaction in failing to deliver concrete that had already been loaded into the employer’s trucks or otherwise taking action to prevent the hardening concrete from damaging the trucks, thus intentionally destroying property owned by Glacier. Notably, the striking employees and their union knew that the trucks had been loaded when they began their strike. An eight-justice majority held that the union and its members were, on the facts of the case, not engaged in protected conduct as that term is defined under the NLRA. Justice Barrett delivered the opinion of the Court, in which the Chief Justice and Justices Sotomayor, Kagan and Kavanaugh joined. Justices Thomas, Gorsuch, and Alito concurred. As against this jurisprudentially diverse array, Justice Jackson was the only dissenter.

The National Labor Relations Board’s top lawyer, Jennifer Abruzzo, issued  a General Counsel memo today instructing the Labor Board’s Regional Directors of her position  that noncompete clauses for employees protected by the National Labor Relations Act (NLRA) (i.e., nonmanagerial and nonsupervisory employees) in employment contracts and severance agreements violate federal labor law except in limited circumstances. The memo, while not law, outlines her legal theory which she will present to the National Labor Relations Board, which makes law primarily through adjudication of unfair labor practice cases.  The memo instructs the agency’s field offices of the position that the General Counsel is instructing them to take when investigating unfair labor practice charges claiming that such clauses interfere with employees’ rights under the NLRA.

On Monday, the National Labor Relations Board (the “Board” or “NLRB”), with a majority of appointees by President Biden, i.e., “the Biden-Board,” reversed the short-lived General Motors LLC, 369 NLRB No. 127 (2020) decision and reinstated the Atlantic Steel test for analyzing whether an employee’s grossly unprofessional conduct when engaging in union or other protected concerted activity loses the protection of the National Labor Relations Act (“Act”). The Board issued Lion Elastomers, LLC, 372 NLRB No. 83 (2023) and reinstated Atlantic Steel 245 NLRB 814 (1979) and its progeny, making it more difficult for employers to discipline employees who engage in outrageous, otherwise inappropriate, speech and/or actions in the course of engaging in union or other protected concerted activity.

On Thursday, April 20, 2023, the National Labor Relations Board (“NLRB” or “Board”) released a decision in Noah’s Ark Processors, LLC d/b/a WR Reserve, 372 NLRB No. 80, in which it laid out sweeping remedies the Board will consider imposing in cases involving so-called “repeat offenders” of the National Labor Relations Act (“NLRA” or the “Act”).

In Noah’s Ark, the Board affirmed findings made by an NLRB Administrative Law Judge (“ALJ”) that the employer bargained in bad faith with the union representing its employees, implemented its final offer without achieving overall impasse, engaged in regressive bargaining and other impermissible bargaining tactics, and threatened and interrogated employees because of their protected activity, all of which came on the heels of the employer defying a previous federal court injunction related to earlier bad faith bargaining and other unfair labor practice allegations. The Board not only upheld the make-whole remedies ordered by the ALJ, but also announced “the potential remedies the Board will consider in cases involving [employers] who have shown a proclivity to violate the Act or who have engaged in egregious or widespread misconduct.” In doing so, the Board ordered remedies beyond those imposed by the ALJ, noting that the Board “[has] broad discretion to exercise [its] remedial authority under Section 10(c) of the Act even when no party has taken issue with the judge’s recommended remedies or requested additional forms of relief.”

As featured in #WorkforceWednesday:  This week, we examine how several recent pronouncements and actions by the National Labor Relations Board (NLRB) and its General Counsel’s office are creating new challenges for employers, both union and non-union.

The General Counsel (“GC”) of the National Labor Relations Board (“NLRB” or “Board”), Jennifer Abruzzo, has opened the vault and released previously unseen Advice Memoranda from her Obama-era predecessor General Counsel Richard Griffin, in her bid to continue to upend long-standing Board law.  Abruzzo, who was Deputy General Counsel under Griffin, and who now heads the Office of the General Counsel, has released a slew of historic Advice Memoranda that shed light on her legal theory to limit employer’s free speech rights and their ability to communicate with employees about the real-world consequences of unionization on the workplace and the employer-employee relationship.

Approximately a month after the Board issued McLaren Macomb, 372 NLRB No. 58, which left employers scrambling to decipher its unclear impact on both unionized and non-unionized workplaces, Jennifer Abruzzo, the General Counsel (“GC”) of the National Labor Relations Board (“NLRB” or “Board”) released guidance outlining her views on the decision’s implications and meaning in Memorandum GC 23-05 on March 22, 2023. The GC’s Memo contains an FAQ in response to inquiries the NLRB has received about the McLaren Macomb decision and outlines Abruzzo’s plans for enforcement of the decision.

On February 21, 2023, the National Labor Relations Board (“NLRB” or “Board”) continued its aggressive application of the National Labor Relations Act (“Act” or “NLRA”) to workplaces without union representation and lessened the value of severance agreements for all employers by finding it unlawful for an employer to merely proffer a severance agreement that includes broad non-disparagement and confidentiality provisions to an employee. In McLaren Macomb, the Board held that a severance agreement that contains a confidentiality clause and a non-disparagement clause was unlawful because, in the Board’s view, these provisions impermissibly infringe on employees’ rights under the Act. Specifically, the Board found that these two provisions limit employees’ ability to discuss their wages, hours, and working conditions (which could include disparaging remarks) with other employees, prevent employees from assisting other employees seeking assistance, and hinder employees themselves from seeking assistance from the NLRB, unions, and other outside organizations.

On January 17, 2023, the U.S. Court of Appeals for the D.C. Circuit partially reversed and partially upheld a District Court decision that enjoined five rules promulgated by the National Labor Relations Board (“NLRB” or “Board”) in 2019 by the Trump-era Board (“2019 Rule”) to modify the Board’s representation election procedures.  The 2019 Rule attempted to ease some of the “quickie election” rules established in 2014 by the Obama-era Board (“2014 Rule”).  For a further discussion of the 2019 Rule, see “NLRB Issues Proposed Rule to Scale Back 2014 Expedited Election Rules.”

The D.C. Circuit held that because the Trump-era Board did not seek public notice and comment as required under the Administrative Procedure Act (“APA”) when issuing the 2019 Rule, “substantive” rule changes could not take effect, but “procedural” rule changes were valid under the procedural exception to the APA’s requirement for notice and comment.

The General Counsel (“GC”) of the National Labor Relations Board (“NLRB” or “Board”) is urging the Board to upend nearly 60 years of precedent and adopt a new legal standard that significantly limits employers’ ability to hire permanent replacements for striking employees. Under current law, employers have a general right to permanently replace workers who go on strike to obtain economic concessions from their employer, so long as an employer does not hire the replacements for an “independent unlawful purpose.” In an Advice Memorandum released on December 30, 2022, the GC confirmed her intention to push for the Board to impose a more restrictive standard that would require employers to show specific business reasons justifying the decision to replace strikers.

On December 16, 2022, the National Labor Relations Board (”Board”) issued its decision in Bexar County II, which restricts the right of property owners to deny off-duty contract workers access to the property for the purpose of engaging in activities protected under Section 7 of the National Labor Relations Act (“Act”). In line with the current Board’s efforts to undo Trump-era decisions and reinterpret the Act to dramatically expand employees’ Section 7 rights and weaken property owners’ rights to control their property, the Board overturned its own precedent on contract workers’ off-duty access and reinstated its standard first established in the 2011 decision in New York New York Hotel & Casino . The Board’s decision in Bexar County II makes clear that it prioritizes contract workers’ access to a third-party’s property for Section 7 activities over the property owner’s own interests in their property. [1]

On December 14, 2022, the National Labor Relations Board (“Board”) issued a decision in American Steel Construction, Inc., reinstating its “overwhelming community of interest” Specialty Healthcare [1] test that gave rise to micro-bargaining units, which are smaller bargaining units that scored unions numerous victories during the Obama administration.  In so doing, the Board overruled PCC Structurals [2] and The Boeing Co., [3] both of which restored and refined the traditional “community of interest” standard used to evaluate challenges to a petitioned-for bargaining unit on the basis it excluded necessary employees. 

On December 13, 2022, the National Labor Relations Board (“Board” or “NLRB”) issued a decision that greatly broadens the remedies available for violations of the National Labor Relations Act (“Act”). Prior to this decision, the Board’s “make whole” remedies for more than 80 years have generally included only backpay, reasonable search-for-work expenses, and interim employment expenses.

In an Advice Memorandum dated April 20, 2022 and released on November 30, 2022, the Division of Advice within the National Labor Relations Board’s (“NLRB” or “Board”) Office of the General Counsel urged the Board to overturn existing Board law to significantly lower the standard for when an employer must furnish the union with its general financial information. This latest push to bolster unions during bargaining follows the NLRB’s General Counsel Jennifer Abruzzo’s (“GC”) issuance of Memorandum GC 21-04 regarding Mandatory Submissions to Advice on August 12, 2021, wherein she signaled her intent to change this standard.

On October 31, 2022, the General Counsel of the National Labor Relations Board (“NLRB” or “Board”) released Memorandum GC 23-02 urging the Board to interpret existing Board law to adopt a new legal framework to find electronic monitoring and automated or algorithmic management practices illegal if such monitoring or management practices interfere with protected activities under Section 7 of the National Labor Relations Act (“Act”).  The Board’s General Counsel stated in the Memorandum that “[c]lose, constant surveillance and management through electronic means threaten employees’ basic ability to exercise their rights,” and urged the Board to find that an employer violates the Act where the employer’s electronic monitoring and management practices, when viewed as a whole, would tend to “interfere with or prevent a reasonable employee from engaging in activity protected by the Act.”  Given that position, it appears that the General Counsel believes that nearly all electronic monitoring and automated or algorithmic management practices violate the Act.

The National Labor Relations Board (“Board”) isn’t giving up on pandemic related mail ballots in representation elections any time soon. On September 29, 2022, in a decision concerning an election at a Seattle area Starbucks, the Board passed on an opportunity to cast aside its COVID-Era six-factor test articulated in Aspirus Keweenaw, 370 NLRB No. 45 (2020), which has been used for the past two years to determine if a Board-conducted representation election should be conducted by mail or in person (called a “manual” election in Board parlance). Instead of jettisoning the Aspirus test entirely, the Board replaced just one of the tests factors, now relying on the CDC Community Level Tracker rather than test positivity trends or rates in this analysis.

On August 29, 2022, the National Labor Relations Board (“NLRB” or the “Board”) issued a decision in Tesla, Inc. regarding dress code policies that further the Biden Board’s efforts to remake NLRB policy. This decision has big implications for employers that maintain appearance, dress code, and uniform policies. The Board’s decision now firmly establishes that any employer’s uniform or dress code policy is inherently unlawful if it can be read “in any way” to prohibit employees from wearing union insignia unless an employer can prove that its policy is justified by special circumstances. It is irrelevant whether the employer’s policy has ever been applied to prohibit union t-shirts or the employer actively permits union buttons or other insignia. Further, and critical to a broader understanding of the implications of this decision, it is also irrelevant whether the workplace is unionized or even being actively unionized.

Employees’ free choice and their right to a secret-ballot election on union membership are potentially at risk, given the latest development from the Office of the General Counsel of the National Labor Relations Board (“NLRB” or “Board”). On April 11, 2022, the NLRB’s General Counsel filed a brief urging a change in long-standing precedent, demanding that the Board force employers to recognize unions as the representative of their employees without first allowing employees the opportunity to cast their votes on union membership in a secret-ballot election held by the Board. The only real requirement for this dramatic result is that the union present signed authorization cards from a majority of the employees that ostensibly confirm the employees’ desire to be represented by the union and that the employer decline recognition of the union without a good faith doubt as to the union’s majority. This brief is General Counsel Jennifer Abruzzo’s first major move to follow through on her previously stated goal of restoring this standard—known as the Joy Silk doctrine—which was abandoned more than 50 years ago.

On April 7, 2022, Jennifer Abruzzo, General Counsel of the National Labor Relations Board (“NLRB” or “Board”), issued Memorandum GC 22-04, titled “The Right to Refrain from Captive Audience and other Mandatory Meetings” (“GC Memo”). It is no secret that the General Counsel has been an advocate for policies and practices that would increase union representation and make it easier for unions to gain recognition and win votes on representation. This includes restricting steps employers can take to share their views with employees. Such a step that the GC Memo calls for is a series of restrictions on what have been called “captive audience speeches,” that is, meetings on company time where employers present their views.

The National Labor Relations Board (“NLRB”) recently sought public comments on the continued use of videoconference technology to conduct hearings. The co-chairs of Epstein Becker Green’s Labor Management Relations Practice submitted the attached comment arguing against continuing remote hearings because they are less efficient, credible, austere and probative and deprive all parties of due process.  Not surprisingly, the NLRB Division of Judges also submitted comments confirming the inadequacies of remote hearings.

For additional information, continue reading ...

Last week, as widely reported, the U.S. Department of Labor’s Occupational Safety and Health Administration (OSHA) issued an Emergency Temporary Standard (ETS) to Protect Workers from the COVID-19 (see full details in our Insight). Currently the subject of much pending litigation including a Temporary Restraining Order (TRO) and thus, for the time being, in limbo, the ETS is nonetheless a set of federal regulations that, unless overturned, applies to a large proportion of U.S. employers with 100 or more workers and requires those employers to either: (a) mandate that all ...