The impact of the novel coronavirus has slammed employers across the globe, and federal agencies such as the National Labor Relations Board (“Board”) are no exception.  The Board announced Thursday the unprecedented step that it was suspending all representation elections, including mail ballot elections, for at least two (2) weeks until at least April 3rd.

Just days earlier, the Agency implemented a nationwide telework policy in both its headquarters and regional offices, encouraging employees of the agency to work from home.  While implementing the election freeze, the Agency highlighted that operations would be limited and open regional offices will maintain “minimal staff.”   In a press release, the Agency stated “given the closure of several regional offices and limited operations and significant telework at others, the Board does not believe that it is possible to effectively conduct elections at this time.”

Likewise, due to the potential  exposure of several agency personnel  to the COVID-19 virus, the NLRB has announced temporary closures of various regional offices including those in Cleveland, Chicago, Denver, Detroit, Manhattan, New Orleans and San Francisco as the agency managed potential Board Agent exposure to COVID-19.  The Agency noted the closures are evolving and stated that it would continue to update the public on its website.

What This Means for Employers and Advocates

While the NLRB and its regional offices continue to function, processing newly filed petitions and unfair labor practice charges, the agency is functioning at a reduced level.  Representation elections that had been scheduled to take place between now and April 3rd have been postponed, as have representation petitions and most other proceedings.  NLRB personnel do continue to investigate ULP charges and attempt to secure agreements for elections in pending representation cases, asking parties to agree that any agreed elections will take place in the future on dates to be determined by the agency’s Regional Directors once operations return to something closer to normal. It is inevitable however that pending cases will be delayed and that backlogs in case processing and resolution will continue to grow.  While the agency will continue to handle incoming cases, and Board employees will continue to work remotely, there will most certainly be a lag in case processing and hearing procedure as the Board navigates remote case-processing and strained adjudication and case-processing capabilities.

We will continue to provide updates as the Board’s guidance evolves.

As we have discussed in prior Advisories, the 2019 Novel Coronavirus (“Coronavirus” or “COVID-19”) public health emergency is raising important issues for employers addressing rapidly developing disruptions to the workplace and the lives of employees with mass school closures, workplace closings, the need to reduce staff and expenses, etc. Employers with  unionized workforces must take certain additional considerations into account when developing and implementing response plans to the current crisis.

Under the National Labor Relations Act (“NLRA” or “Act”), employers have a legal duty to bargain with labor unions representing their employees regarding the employees’ wages, hours and other conditions of employment.  In addition, many employers are party to collective bargaining agreements (“CBA”) with the unions that represent their employees that contain provisions directly relevant to the types of adjustments that may be necessary for businesses to respond to the unprecedented challenges this pandemic and its broad effect on society and commerce presents. Absent language in a CBA recognizing an employer’s right to act, either by adjusting schedules, reducing the numbers of employees working, modifying pay and/or benefits, employers generally may not make unilateral changes to these terms without first providing their employees’ union representatives with reasonable notice and an opportunity to bargain over the same.  The current public health emergency does not eliminate these legal obligations of employers, although it certainly affects what may be deemed reasonable notice and an opportunity to bargain given the ongoing emergency.

Accordingly, unionized employers planning their responses to Coronavirus should consider the following factors:

  • Have a Plan
    • Regardless of whether an employer’s employees are represented by a union, leading healthcare experts all agree that employers should have a preparedness and response plan (guidance on preparedness for employers is available from the CDC and WHO).
    • To assist, please feel free to review Epstein Becker & Green’s Coronavirus resource center and/or attend our free webinar on Friday.
  • Review CBA and Work Rules
    • Assess whether the current CBA includes language permitting, or prohibiting, the employer from take certain of the actions called for by response plan to protect the health and safety its workforce. For example:
      • Is there a “force majeure” or other public emergency clause that may apply;
      • What do the existing CBA and applicable employer policies provide regarding the prevention of ill or contagious employees coming to the workplace, or being sent home from the workplace;
      • What do the CBA or existing policies provide regarding the permissible or mandatory usage of, or restrictions on using, paid sick leave, paid time off, vacation, short term disability, and Family and Medical Leave in instances where employees are infected, caring for an infected family member or quarantined due to possible exposure to COVID-19;What restrictions are in place regarding the potential use of salaried supervisors and managers, outside contractors, and/or temporary workers for potentially filling temporary workforce vacancies created by the current public health emergency.
      • What restrictions, if any, does the CBA provide concerning reducing hours and/or days of employment, modifying pay and benefits, reducing staffing levels and other contingencies.
    • Identify elements of your proposed/draft Coronavirus Response Plan that may conflict with the terms of your CBA, and those that conflict with existing policies and/or practices that are in effect outside of the CBA.
    • Proposed changes in the CBA will require notice to the union and/or the union’s written consent to avoid a contract breach, even if for a temporary change, while changes in policies and practices outside of the CBA require notice and a reasonable opportunity (under the circumstances) to bargain over changes – either to agreement or impasse before implementation.
    • Contact union leadership regarding the immediate need implement a COVID-19 response plan, and management’s need and availability to meet as soon as possible to discuss and resolve the same. While there is no fixed period for what is reasonable notice, given the current public health emergency it may be reasonable to require the union to meet potentially the same day or at least by the following day, but the point is it need not be notice where the union is provided one or two weeks or more to respond or bargain.
  • Meeting with Union Leadership
    • Union leaders are under pressure from their members for answers regarding development of a Coronavirus Response Plan, and may welcome the opportunity to learn of the Company’s proposed plan, and to have input into the same. In this regard, one a Coronavirus Response Plan is finalized, the union leadership may prove to be a valuable additional resource in communicating the same to employees, and to identifying for management question and issues that employees raise that neither management nor the union anticipated.
    • Examples of appropriate topics to discuss with union leadership include:
      • Usage of paid sick leave, paid time off, and other forms of paid and unpaid leave in instances where workers are infected or quarantined;
      • Obligations for an employee to disclose if he or she has been infected with or exposed to COVID-19, or has recently traveled to a “high risk” country as designated by the CDC;
      • Criteria for an employee’s return to work; and
      • Possibility of shutdown by government, public health officials or management, which may involve the need to make a temporary layoff, possibly including a voluntary layoff or relaxing strict compliance with existing layoff procedures, or include invoking total and/or partial plant closure language in a CBA, etc.
    • As the Coronavirus crisis continues to develop, it will be important to keep union leadership informed of any needed changes to the Coronavirus Response Plan. This ongoing dialogue will serve to help provide the union leadership with timely notice of any particular issues affecting the workplace as they arise, and rapid completion of the employer’s obligation to bargain with the union over the same prior to implementing further changes in employees’ terms and conditions.
  • Monitor Legal and Regulatory Developments
    • Stay up to date on actions being taken by your federal, state and local governments, as well as regulatory updates from the CDC and OSHA, and timely share such notices that potentially affect your workforce with the union leadership.

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Employers in New York, the second-most unionized state in the country, have lost another key point of leverage in collective bargaining.  Effective February 6, 2020, Senate Bill 7310 reduces the amount of time striking workers in the private sector must wait before they are eligible to receive unemployment benefits.  While New York is one of only a handful of states to allow strikers to receive unemployment benefits,[1] the seven week waiting period that has applied until now, has served as a deterrent to strikes. The new, shorter waiting time has the potential to profoundly affect the calculus and reduce employers’ economic leverage in collective bargaining because earlier access to unemployment benefits will soften the blow that a strike has on an employee’s financial well-being and potentially increase the willingness of unions and employees to strike.

Access to Unemployment Benefits While Striking in New York

The Supreme Court has long held that the National Labor Relations Act does not preempt a state’s ability to determine whether unemployment benefits are available for employees engaged in a labor dispute.  As unemployment benefits are generally available only to those workers who are ready willing and able to work, employers might reasonably expect that workers who voluntarily withhold their labor in a strike would not be eligible for such benefits.  While most states appear to agree and do not permit employees who are on strike to collect unemployment insurance benefits, New York remains an outlier.

Historically, striking employees in New York had to wait seven weeks before they could file for unemployment benefits, unless there was a lockout or the employer hired replacement workers.  This waiting period meant that striking workers could not receive their first benefit check until the ninth week of the work stoppage.  The purpose of the delay in benefits was to prevent the state from inserting itself prematurely into a private-sector labor dispute and to “avoid the imputation that a strike may be financed through unemployment insurance benefits.”  Matter of Burger, 277 App. Div. 234 (1950).  This thoughtful counter-balance reduced the risk of frivolous strikes and work stoppages, while providing an eventual safety net for those rare instances where a labor dispute suffered a long impasse.

Reducing the Waiting Period

Under New York’s amended law, the amount of time that striking workers must wait before receiving unemployment benefits is reduced from seven weeks to two weeks.  This law modifies a previously adopted bill that would have required workers to wait just one week after the start of the strike to be eligible to receive unemployment benefits.   Had the legislature not amended the 2019 bill, for the purposes of unemployment benefits in New York, striking workers would have been treated similarly to those employees who became jobless involuntarily.

A New Calculus for New York Employers

A reduction in the waiting period for unemployment benefits potentially changes the dynamics in collective bargaining by reducing the incentive for unions and workers to avoid strikes and the economic hardship on those who strike and increasing the pressure on employers to concede to union demands to avoid strikes.  Over the last two years there has been a recent upsurge in major strike activity. With unemployment benefits now available sooner, unions may be more willing to initiate or prolong a strike to improve their bargaining position.  New York employers should be wary of how this shift in the costs of striking could affect future labor negotiations and update their existing strategies accordingly.

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[1] The list of states permitting striking workers to receive unemployment benefits is short.  In 2018, New Jersey passed a bill permitting striking workers to begin collecting unemployment benefits 30 days after the start of a strike.  Other states, such as GeorgiaNew Hampshire, Rhode Island, West Virginia, provide benefits if unemployment continues after the labor dispute ends, so long as the worker did not participate in the strike and are not a member of the union involved in the labor dispute.

The National Labor Relations Board has announced the issuance of its final rule governing joint-employer status. The new rule, which was first proposed in September 2018 and has been the subject of extensive public comment, will become effective April 27, 2020.

The critical elements for finding a joint-employer relationship under the new rule is the possession and the exercise of substantial direct and immediate control over the terms and conditions of employment of those employed by another employer.  The essence of the new rule is described in the Board’s February 25, 2020 press release:

To be a joint employer under the final rule, a business must possess and exercise substantial direct and immediate control over one or more essential terms and conditions of employment of another employer’s employees. The final rule defines key terms, including what are considered “essential terms and conditions of employment,” and what does, and what does not, constitute “direct and immediate control” as to each of these essential employment terms. The final rule also defines what constitutes “substantial” direct and immediate control and makes clear that control exercised on a sporadic, isolated, or de minimis basis is not “substantial.”

Evidence of indirect and/or contractually reserved control over essential employment terms may be a consideration for finding joint-employer status under the final rule, but it cannot give rise to such status without substantial direct and immediate control. Importantly, the final rule also makes clear that the routine elements of an arm’s-length contract cannot turn a contractor into a joint employer.

The new rule marks a return to a standard similar to that which the Board followed from 1984 until 2015.  In 2015, in Browning-Ferris Industries, the Board adopted a much more liberal test under which a finding that the putative joint employer possessed indirect influence and the ability (including through a reserved contractual right) to influence terms and conditions, regardless of whether the putative joint employer actually exercised such influence or control, could result in it being held to be a joint-employer of a second employer’s employee.

As a practical matter, the standard under the Board’s new rule should make it much more difficult to establish that a company is a joint-employer of a supplier, contractor, franchisee, or other company’s employees. The new rule will mean that a party claiming joint-employer status to exist will need to demonstrate with evidence that the putative joint-employer doesn’t just have a theoretical right to influence the other employer’s employees’ terms and conditions of employment, but that it has actually exercised that right in a substantial, direct and immediate manner.

This new rule is likely to make it much more difficult for unions to successfully claim that franchisors are joint-employers with their franchisees, and that companies are joint-employers of personnel employed by their contractors and contract suppliers of labor, such as leasing and temporary agencies.

As private sector unionization rates have continued to fall over recent decades, organized labor has increasingly turned to the state and local politicians it supports for assistance in the form of state legislation and local ordinances imposing burdens on employers and aid to unions, while depriving employees of the process and balance intended by the National Labor Relations Act (“NLRA”).  These often come in the form of “Labor Peace” requirements which mandate employers enter into agreements with unions that do not represent their employees as a condition of doing business with government entities or as a condition of entry into government controlled or regulated sectors.  The emerging legalization of marijuana and cannabis in California is one of the latest examples of this trend.

Why AB 1291 Will Make It Easier for Unions to Organize Cannabis Employees and How Cannabis Employers Can Prepare and Protect Themselves

California’s AB 1291, which goes into effect on January 1, 2020, mandates that all cannabis license applicants employing more than 20 employees must enter into a “labor peace agreement,” as defined by Business and Professions Code Section 26001(x), that prohibits a union from engaging in strikes, work stoppages and other economic interferences.  Employers without a qualifying labor peace agreement will not qualify for a cannabis license.  While on its face this ordinance purports to protect the cannabis industry from the disruption of labor disputes, in reality, it effectuates a compelled waiver of fundamental rights guaranteed under the NLRA and makes it much easier for unions to organize cannabis employees.

How AB 1291 Impacts NLRA-Protected Rights and Makes It Easier to Organize Employees

Waiver of Employer’s Property Rights.  Under the NLRA, unions generally enjoy no greater access to an employer’s property than any other member of the public, which allows cannabis employers to exclude union organizers from their property.  AB 1291, however, compels cannabis employers to waive their property rights by mandating that any cannabis employer that is party to a labor peace agreement, which typically will be with a union that is seeking to represent that employer’s workers, provide the union “access at reasonable times to areas in which the applicant’s employees work for the purpose of meeting with employees to discuss their right to representation, employment rights under state law, and terms and conditions of employment.”  This means that union organizers must be permitted to enter the working areas of a cannabis employer’s private property and speak to employees about joining and being represented by the union.

“Neutrality.”  The NLRA, a federal law, protects employers’ free speech rights – their Section 8(c) rights – and allows employers to share their opinions, experiences and facts about unions with employees.  These are essential tools for employers facing union organizing drives as they allow employers to educate employees about the reality of union representation and respond to misinformation disseminated by the union.  More important, hearing both perspectives allows employees to make informed and free choices on whether they or not they want to be represented by a union.  Neutrality provisions in labor peace agreements contractually waive employers’ ability to deploy these dynamic tools and typically require employers to remain impartial on all union matters.  While AB 1291 does not explicitly waive cannabis employers’ free speech rights, neutrality is one of the most common union demands in labor peace agreement negotiations, and employers can expect that unions will insist on neutrality as consideration for entering into a labor peace agreement.  Because a labor peace agreement with a union is required to do business, AB 1291 provides unions the necessary leverage to impose these type of provisions.

Card Check Not Required Notably, AB 1291 stops short of many other state and local “labor peace” mandates by expressly not permitting “card check” provisions which deprive employees of NLRB supervised secret-ballot elections.  Such card checks are typically imposed as a result of other “labor peace” statutes, but are expressly not permitted under the definition of labor peace agreement under Section 26001.  This is likely an attempt to avoid a finding that the statute is preempted by the NLRA as card checks have long been argued to be unlawful – a position the NLRB General Counsel seemingly recently adopted.

Why AB 1291 Is Likely Preempted by Federal Law

AB 1291’s impact on fundamental NLRA-guaranteed rights is precisely why a strong case for preemption exists.  Preemption renders a state or local law unconstitutional when it either (1) regulates activity protected or prohibited by the NLRA (known as Garmon preemption) or (2) regulates conduct that effectively disrupts the balance of power between employers and unions (known as Machinists preemption).  AB 1291 is likely unconstitutional under both preemption doctrines, even without requiring card check.

First, AB 1291 explicitly regulates economic weapons and property rights protected by the NLRA.  Second, AB 1291 implicitly regulates free speech rights guaranteed by Congress to employers in the NLRA, since unions invariably insist on a waiver of employer free speech rights as consideration for entering into a labor peace agreement.    Because the state conditions a cannabis license on a labor peace agreement, a cannabis employer is forced into a position of choosing between either losing their business or giving up its and its employees’ federal rights.  In this regard, the state indirectly regulates employer speech by essentially forcing employers to submit to neutrality in order to receive a cannabis license, and it indirectly regulates employees’ rights to choose by encouraging employers not to share opposing views with employees.

An exception to preemption is recognized where the state is acting as a market participant and its actions further a proprietary interest.  This exception does not apply here, though, because the state is not acting as a market participate seeking to procure goods and services for itself in enacting AB 1291.  Rather, AB 1291 targets private businesses seeking to deliver cannabis products to private citizens through a licensing scheme that regulates conduct exclusively regulated to the purview of the NLRA.  Similar licensing schemes have been declared preempted by the United States Supreme Court and federal district courts.  Building and Const. Trades Council of Metropolitan Dist. v. Associated Builders and Contractors of Massachusetts, 507 U.S. 218, 227 (1993); Aeroground, Inc. v. City and county of San Francisco, 170 F. Supp.2d. 950, 958 (2001).

What Cannabis Employers Can Do In Response to AB 1291

Not surprisingly, although there is a strong case against AB 1291, challenging the new law will likely be economically infeasible for most cannabis employers.  However, there are important steps employers can take both before and after the law takes effect to protect its interests.

Strategic Labor Relations Plan.  The best offense is a good defense, and for cannabis employers, a tactical labor relations strategy is the best defense to AB 1291.  Unions win elections because they promise to change the way employees are treated, not because they promise more money.  Often, a few small changes in an employer’s internal processes can make a dramatic difference in employee morale and contentment, and a strategic labor relations plan ensures employers have optimized their internal processes so that a union cannot promise employees a dramatic improvement in working conditions.

Educate Employees Now.  AB 1291 does not directly impose neutrality upon employers starting January 1, 2020; rather, neutrality will be the likely result of any mandated labor peace agreement ultimately agreed upon.  Accordingly, until cannabis employers finalize a labor peace agreement with a union, they should consider taking advantage of their 8(c) rights and appropriately educate their employees about unions and their impact on employees and the workplace.

Review of Workplace Policies.  Workplace policies are the key to retaining control over the workplace and minimizing disruption once a union organizing drive begins.   Cannabis employers should have their workplace policies reviewed by a labor relations specialist to ensure (1) they are lawfully compliant and (2) they afford the employer maximum control over the workplace and workforce.  It will become more difficult to change workplace policies once a labor peace agreement is in place and a union organizing drive beings, so prudent cannabis employers should aim to have their policy review completed before finalizing a labor peace agreement with a union.

Minimize Concessions in Negotiations for a Labor Peace Agreement.  Cannabis employers should use the labor peace agreement negotiations to minimize concessions to the union and obtain gains of their own.  For example, while AB 1291 requires that unions be granted reasonable access at reasonable times, a cannabis employer can negotiate provisions that specifically delineate when and where union organizers can access its property, which can significantly curtail the disruption such access can cause.  Additionally, employers can negotiate affirmative provisions into their agreement which are designed to actually enhance, advantage or protect their business in exchange for the neutrality or related provisions a union may demand.

The National Labor Relations Board, in its December 17th decision in Apogee Retail LLC d/b/a Unique Thrift Store, has reversed its prior rule and held that employer requirements that employees treat workplace investigations as confidential are “presumptively lawful.”  The Apogee decision overturns the Board’s 2015 Banner Estrella decision, which had required that an employer seeking to impose confidentiality in connection with a workplace investigation was required to prove, on a case by case basis, that the integrity of an investigation would be compromised without confidentiality.

The Board concluded that the framework set forth in Banner Estrella improperly placed the burden of proving that confidentiality was necessary on the employer and was inconsistent with the Board’s test developed in The Boeing Company for determining whether a facially neutral rule unlawfully interfered with employees’ rights under Section 7 of the National Labor Relations Act.  In its press release, the Board explained:

The Board concluded that the framework set forth in Banner Estrella improperly placed the burden on the employer to determine whether its interests in preserving the integrity of an investigation outweighed employee Section 7 rights, contrary to both Supreme Court and Board precedent. The Board also noted that the new standard better aligned with other federal guidance, including EEOC enforcement guidance.

In today’s decision, the Board applied the test for facially neutral workplace rules established in The Boeing Company, 365 NLRB No. 154 (2017), and determined that investigative confidentiality rules limited to the duration of the investigation are generally lawful. Because the rules at issue in this case did not limit confidentiality to the duration of the investigation, the majority remanded this case for further consideration.

What Employers Should Do Now

The Apogee decision makes clear that the Board will find a rule requiring employees to respect the confidentiality of ongoing investigations of harassment, discrimination and other workplace issues while such investigations are underway.

However the Board noted that another question that arose under Apogee that requires further consideration is what level of confidentiality is presumptively appropriate once the investigation in question is concluded.

Many employers and other organizations have, since Banner Estrella was decided more than four years ago, to reconcile their obligations under Title VII and other laws against harassment and other forms of discrimination, to treat investigations with an appropriate degree of confidentiality to help protect the rights of employees and witnesses who report misconduct and participate in investigations while not unlawfully interfering with employees’ rights under the National Labor Relations Act.

With the Apogee decision employers should consider reviewing and as appropriate revising their investigation procedures, including those with respect to confidentiality, to reflect the Board’s new guidance.

On December 17, 2019, the National Labor Relations Board (“Board”) ruled that an employer’s rule prohibiting use of its email system for nonbusiness purposes did not violate employees’ rights under the National Labor Relations Act. The 3-1 decision in Caesars Entertainment Corp d/b/a Rio All-Suites Hotel and Casino, NLRB Case No. 28-CA-060841, overturns the Board’s 2014 decision in Purple Communications, which held that work rules prohibiting employees from using employer-provided email systems for union activity were presumptively invalid.

According to the Caesars Entertainment majority, employees “do not have a statutory right to use employers’ email and other information-technology (IT) resources to engage in non-work-related communications.”  “Rather, employers have the right to control the use of their equipment, including their email and other IT systems, and they may lawfully exercise that right to restrict the uses to which those systems are put, provided that in doing so, they do not discriminate” against activities protected by Section 7 of the National Labor Relations Act, such as discussing wages, hours, and terms and conditions of employment.

In overturning Purple Communications, the Board effectively reinstated a prior 2007 decision known as  Register Guard, with one exception.  Under Caesars Entertainment, employees may lawfully use an employer’s email and IT resources for Section 7 activities when they are “the only reasonable means for employees to communicate with one another.”

What This Means

Many employers rewrote their employee handbooks and work rules as a result of Purple Communications.  In light of Caesars Entertainment and some other recent decisions by the NLRB, employers should considering revisiting their employee handbooks and policies and determine whether changes to comply with the new developments make sense for their business.  Employers that decide to implement a work rule banning employees from using company-provided email or IT resources for Section 7 activities, however, must ensure that they implement any such rule in a neutral and non-discriminatory manner.  In other words, “business use only,” must truly mean “business use only.”

Approximately four years ago, during the Obama Administration, the National Labor Relations Board upended decades of well-settled precedent by making it unlawful for employers to unilaterally cease dues checkoff pursuant to a contractual dues check-off provision upon the expiration of a collective bargaining agreement.  This week, the Republican-majority Board in Valley Hospital Medical Center, Inc. reversed that departure from established precedent and restored balance and stability in collective bargaining negotiations by holding that an employer has the right to stop withholding employees’ union dues from their pay when the parties’ contract expires.

For More Than 50 Years, Employers Could Unilaterally Cease Dues Checkoff Post-Expiration

Because employers have a duty to maintain the status quo upon expiration of a union contract, most contractually established terms and conditions generally continue in effect after the contract expires until a new agreement is reached or the parties reach impasses.  However, the Board has long recognized a limited category of provisions that do not survive contract expiration.  Prior to 2015, this limited category of exemptions from the status quo rule included no-strike/no-lockout and dues checkoff provisions, meaning unions could strike and employers could lock employees out and/or stop withholding and emitting union dues despite expired contract provisions prohibiting such actions.  This rule fostered balance and stability in negotiations by ensuring both unions and employers could deploy important economic weapons as leverage during contract negotiations.

Employers relied on this rule for more than 50 years.  In 2015, however, the Board in Lincoln Lutheran held employers could no longer unilaterally cease dues deductions when a contract expired, thereby removing a key economic weapon from employers’ arsenal.  The effect was to create a bargaining disparity in which unions had no restrictions on their economic weapons during post-expiration negotiations but employers did.

Obligations Whose Existence Depends Solely on the Contract Do Not Survive the Contract

The Board in Valley Hospital Medical Center has now rectified the inequity perpetuated by Lincoln Lutheran and reinstated employers’ ability to unilaterally discontinue dues checkoff after the expiration of a union contract. Adopting the rationale of a 2010 Board decision, the Board reasoned that dues checkoff provisions, like no-strike provisions, “cannot exist in a bargaining relationship until the parties affirmatively contract to be so bound.” Accordingly, “these obligations are coterminous with the contracts that gave rise to them.”  The Board distinguished these “contractually created” obligations from other terms and conditions of employment which can exist prior to and independent of a contract and, therefore, must be continued as part of the status quo after contract expiration.

The Board also noted that its decision better effectuates the policies of the National Labor Relations Act and the proper role of the Board.  Characterizing the Lincoln Lutheran decision as an “impermissible interference with the statutory bargaining process,” the Board noted the decision “undermin[ed] established bargaining practices and relationships that ordinarily promote labor relations stability” and had the potential to transform dues checkoff into “a considerably more divisive bargaining subject with the potential to frustrate efforts” to reach an initial or successor contract.

The Board also reiterated the Supreme Court’s edict that the Board should not function “as an arbiter of the sort of economic weapons the parties can use in seeking to gain acceptance of their bargaining positions.”  However, that is precisely what the Board did when, in 2015, it declared the post-expiration discontinuation of dues checkoff an invalid economic weapon.  Fortunately, now that the Board has corrected this short-lived restriction on employers’ economic weapons, employers can once again permissibly discontinue dues checkoff after contract expiration in support of their bargaining positions.

The National Labor Relations Board (“Board” or “NLRB”) has announced that it is publishing proposed changes to its Rules and Regulations that will begin to reverse the Board’s 2014 changes, which took effect in 2015, to its representation election rules and procedures commonly referred to as the “ambush election rules.”  The proposed final rule is expected to be published in the Federal Register on December 18, 2019 and to become effective 120 days after publication.

Board Chairman John F.  Ring described the rule changes as “common sense changes to ensure expeditious elections that are fair and efficient. The new procedures will allow workers to be informed of their rights and will simplify the representation process to the benefit of all parties.” In December 2017, the Board had announced that it was seeking comments concerning parties’ experiences under the 2015 rule changes, to determine what, if any changes, would be beneficial.

The new final rule, which is over 300 pages in length, will, when it takes effect, change many of the most troublesome aspects of the 2014 rules.  The new rule will, among other things:

  • Extend the time between the filing of a representation petition from eight to 14 days,
  • Extend the time for employers to post the Notice of Petition from two to five days,
  • Extend the time for employers to file their the Statement of Position identifying any issues to be resolved before an election can be held eight days after an employer is served with the petition and confirm that the Board’s Regional Directors will have the discretion to allow additional time upon a showing of “good cause, and
  • Extend the time employers have to provide the petitioning union and the NLRB with the initial list of employees in the petitioned for unit from two days to five business days.

Significantly, the new final rule will extend the time for the holding of elections.  While the final rule continues to mandate that representation elections be conducted at “the earliest date possible,” the new final rule defines this as normally not “before the 20th business day after the day of the direction of election.”

The new final rule will add a requirement that a petitioning union also file a written Statement of Position, which will be due three days after the employer’s statement of petition which the Board explains will result in more orderly litigation by narrowing and focusing the issues to be litigated.”

Parties rights to file post-hearing briefs, which were severely curtailed under the 2014 rules are also substantially restored.  Under the 2014 rules, post-hearing briefs have only been permitted “only upon special permission of the regional director,” and only as to those issues allowed by the Regional Director.

A major change in the new final rule is that the Board will once again allow for the resolution of significant legal issues before an election will be directed, rather than after the vote is held.  Issues concerning the scope of the proposed bargaining unit, supervisory status and other issues will once again be “litigated at the pre-election hearing and resolved by the regional director before an election is directed.”  

Additionally, employers and unions will once again have the right to seek review of such issues by the Board before election results are certified by the Regional Director, who  “will no longer certify the results of an election if a request for review is pending” or before the deadline for filing a request for review.

What Happens Next

 The Board has also announced that it will be revising its Case Handling Manual, which provides guidance to the agency’s staff, to reflect the new final rule.   Litigation challenging the new rule remains a possibility.