Posted in NLRB
The General Counsel of the National Labor Relations Board (NLRB or Board), Jennifer A. Abruzzo, recently issued a memorandum stating that “the proffer, maintenance, and enforcement” of noncompete provisions in employment contracts and severance agreements violate the National Labor Relations Act (NLRA or Act) except in limited circumstances.
Posted in NLRB
In the latest swing away from recent precedent, the National Labor Relations Board (NLRB or Board) issued its ruling in Lion Elastomers LLC II, which overturns the 2020 General Motors LLC decision. These decisions address an employer’s ability to issue discipline in response to a worker’s profane speech or conduct purportedly taking place in the context of workplace activism and union-related activity.
Put simply, the Lion Elastomers decision makes it significantly more difficult to terminate employees using derogatory language or engaging in abusive conduct when claiming to speak out against workplace conditions. The tests to assess whether the conduct is so egregious as to cause an employee to lose protections under the National Labor Relations Act (NLRA) require consideration of the setting and context of the situation.
What Changed?
Under the now-overturned General Motors LLC decision, the Board rejected setting-specific standards to determine whether employers unlawfully disciplined or discharged employees engaging in alleged abusive conduct while participating in activity purportedly protected by Section 7 of the NLRA (which protects the right of employees to organize or to discuss shared concerns regarding the workplace). The General Motors Board concluded that, regardless of the setting involved, the fundamental issue would be the motive of the employer in taking adverse action against the employee. Under General Motors, an employer could legally discipline an employee if it could show it would have reprimanded the employee without the alleged union activity.
What’s the Rule Now?
The Lion Elastomers decision expands employees’ Section 7 rights and makes it more difficult to discipline or terminate an employee engaging in derogatory behavior. In assessing whether a worker’s conduct is so egregious as to cause them to lose the protection of the NLRA, the Board has now restored a series of tests that use context- or setting-specific factors and account for labor disputes being “heated affairs.” These tests, each of which gives workers more leeway for behaviors (including racially charged or misogynistic slurs) in certain contexts, include:
The Atlantic Steel Test: This is a multifactor test, which applies to outbursts in the course of confrontation with a manager and considers where the interaction took place, the subject matter, the nature of the outburst and whether the employer provoked the outburst.
TheTotality-of-the-Circumstances Test: This assessment applies to social media posts and cases involving conversations among employees in the workplace. Here, the Board will apply a totality-of-the-circumstances approach without regard to any particular factor.
The Clear Pine Mouldings Standard: This test governs picket line misconduct. Again, the Board will examine the totality of the circumstances in determining whether non-striking employees would have reasonably been coerced or intimidated by the misconduct. If so, discipline is proper.
The Board has opined that each of these standards shares a “common principle,” namely that “conduct occurring during the course of protected activity must be evaluated as part of that activity—not as if it occurred separately from it and in the ordinary workplace context.” Under these circumstance-specific tests, an employee’s outrageous statements could be considered protected activity, shielded from discipline. This leaves the door open for statements to be made – without resulting discipline or termination – that may cause problems down the road for the employer. For example, under some circumstances, the Board’s decision may prevent an employer from disciplining an employee making racist statements in the context of union activity, while exposing the employer to another employee’s EEOC charge based on the undisciplined statements. In fact, the Board goes so far as to suggest that employees engaging in Section 7 activity who make otherwise actionable comments must actually create a hostile work environment before the employer can take adverse action and, even then, the employer’s ability to do so is not clear. Lion Elastomers LLC II, 372 NLRB No. 83, slip op. at 8–9 (2023).
Bottom Line for Employers
Under the Board’s latest decision, not all employee misconduct is equal. Indeed, the Board opined that “[t]here is a fundamental difference . . . between employee misconduct committed during Section 7 activity and misconduct during ordinary work.” Id. at 2. It will not be enough for an employer to assess whether it would still discipline the employee for the same conduct or language regardless of union activity.
Additionally, a one-size-fits-all disciplinary approach for specific behaviors exhibited in conjunction with Section 7 activity will no longer be acceptable. Instead, derogatory behaviors must now be analyzed under the applicable context-specific test restored in the Lion Elastomers decision. Each test allows for greater employee latitude and protection than the Board’s General Motors decision did; thus, employers should be aware that it will be more difficult to discipline an employee for making outrageous statements or engaging in derogatory behaviors if made while participating in protected concerted activity.
Should you need to discuss this decision and its effect on your organization in greater detail, the BakerHostetler Labor and Employment Practice Group is available to assist.
Posted in NLRBWe recently wrote about the National Labor Relations Board’s (“NLRB” or “Board”) decision in McLaren Macomb (the “decision”) which reversed several Trump-era rulings that largely had allowed employers to proffer severance agreements to employees (generally, non-supervisors) containing broad confidentiality and non-disparagement provisions.
In response to the widespread uncertainty related to the decision, NLRB General Counsel (“GC”) Abruzzo issued a memorandum outlining her guidance and responses to common inquiries associated with the decision.
The BakerHostetler team has reviewed GC Abruzzo’s guidance. It’s important to note that GC Abruzzo’s guidance does not have the force of law. In essence, GC Abruzzo is akin to a prosecutor (although NLRB proceedings are not criminal in nature). Accordingly, her guidance only describes the types of cases and arguments that she intends to present to the NLRB to argue for a finding of a violation. Ultimately, it will be for the NLRB to decide what does and does not constitute a violation under McLaren Macomb. The NLRB may agree with GC Abruzzo – or it may not.
With that said, below is a summary of the inquiries addressed and associated responses – and a bit of commentary.
Q: Can employers still proffer, maintain, and enforce severance agreements according to GC Abruzzo?
A: Yes, but the GC will likely pursue a claim for a violation where a severance agreement contains typically broad confidentiality and non-disparagement provisions.
Q: Do confidentiality provisions remain lawful according to the Board?
A: Yes, but only if they are narrowly tailored to restrict the dissemination of proprietary or trade secret information for a fixed period of time based on legitimate business reasons. A clause that the GC views as having a “chilling effect” on exercising Section 7 rights (the right of employees to come together to organize a union or to discuss shared concerns regarding the workplace) will be considered to violate the National Labor Relations Act (“NLRA” or the “Act”).
Q: What about non-disparagement provisions? Is it possible to draft a provision that passes scrutiny?
A: Yes, but it will likely not be as effective as it once was. Non-disparagement provisions that are narrowly tailored and justified can be considered lawful. Under the Board’s ruling, the provision should be limited to meet the definition of defamation (i.e., maliciously untrue). However, in some circumstances, it is recommended to continue to include a prohibition on disparagement of the company’s products or services.
Q: Can I fix my severance agreement with a savings clause or disclaimer?
A: According to GC Abruzzo, probably not – unless an employer wants to insert a full statement of rights under Section 7 of the NLRA.
Q: What if there are extenuating circumstances that might warrant broad provisions? Or what if an employee or union representative requests broad provisions?
A: There is no end run, from the GC’s perspective. Her view is that surrounding circumstances of any kind do not matter and should be disregarded when analyzing whether a provision is facially lawful.
Q: Does it matter if an employee rejects or does not sign a severance agreement with overbroad provisions?
A: No. The mere proffer of an agreement with overly broad provisions constitutes unlawful employer conduct under McLaren Macomb. Therefore, whether an employee signs a severance agreement is irrelevant in determining whether there has been a violation of the Act.
Q: Does this decision cover severance agreements offered to supervisors as well?
A: In general, no. Section 7 rights apply only to nonsupervisory employees. However, GC Abruzzo suggested in her guidance that she may pursue violations associated with severance agreements presented to supervisors under certain circumstances. Further, the Act also protects supervisors from being retaliated against for refusing to act on their employer’s behalf in committing an unfair labor practice or from being barred from participating in Board proceedings.
Q: Is the decision retroactive?
A: According to GC Abruzzo, it is. But the Board hasn’t had that issue presented yet. And even if the Board finds that the decision has retroactive applicability, an appellate court may find otherwise. This is very much a “stay tuned” issue.
Q: How does the decision impact previously entered-into severance agreements with broad language? Would the entire agreement be invalidated?
A: GC Abruzzo has cautioned that, in her view, the 6-month statute of limitations to file an unfair labor practice charge might not apply to an employer’s ongoing enforcement of unlawful language that restricts Section 7 rights. But the finding of a violation pertaining to a confidentiality or non-disparagement provision may not invalidate the entire agreement, if those provisions can be severed.
Q: Are former employees covered by this decision too?
A: Yes, former employees are entitled to protections under the Act. The Board views former employees as having an important role in providing it with evidence and information.
Q: What is the impact of the decision on pre-employment communications or offer letters?
A: Provisions in any employer communication to employees that tend to interfere with Section 7 rights may be considered unlawful if they are not narrowly tailored to address a special circumstance justifying the limitation on workers’ rights.
TAKEAWAYS:
Should you need to discuss the Board’s decision, this associated guidance, and its effect on your organization’s past or future severance agreements, the BakerHostetler Labor and Employment Practice Group is available to assist.
Posted in Alert
In January 2023, the Occupational Safety and Health Administration (OSHA) revived a rule that would permit worker-designated representatives to accompany OSHA during the inspection process, regardless of whether the representative is an employee of the workplace being inspected. In other words, under the proposed rule, individuals who do not even work at the inspected workplace could participate in the OSHA inspection at the invitation of a potential union. Workplaces that are not yet unionized should therefore anticipate a scenario where outside organizers accompany OSHA during its walk-around, working in tandem to point out alleged safety and health hazards at the facility.
The proposed rule aims to renew a controversial Obama-era policy that ended in 2017 during the Trump administration when OSHA rescinded the rule amidst legal challenges. As proposed, the rule would have two key impacts. First, it would “clarify” the role of union representatives, many of whom are union staff members and not employees of the workplace, during inspections. This change would affect work sites that are already unionized and allow that union to designate someone who is not employed at the inspected facility—such as a representative from the union’s national office—to accompany OSHA during the inspection. Second, and more divisively, the proposed rule would enable nonunionized workforces to designate union representatives to participate in OSHA inspections, subject only to the requirement that the compliance officer deems the representative’s presence “reasonably necessary to an effective and thorough physical inspection.” While OSHA does not yet provide clear guidance on who is “reasonably necessary” to an inspection, we expect this phrase to be interpreted liberally and that compliance officers will frequently permit a designated representative to participate. Bottom line, OSHA did not revive a rule allowing nonemployees to participate in the OSHA inspection only to have its compliance officers determine that their participation is unnecessary.
Read full alert for more information.
Posted in NLRB
Under the National Labor Relations Act, unions are entitled to request information from an employer that is relevant to carrying out the union’s representation duties. The key limiting principle is that the union must demonstrate the “relevance” of information that does not pertain directly to the wages, hours or working conditions of bargaining unit employees. On February 28, the National Labor Relations Board (the Board) issued a decision that significantly alters the “relevance” test.
The case in question involved Hawaii’s UNITE HERE Local 5 and a Hawaiian Hotel (“Hotel”). During the COVID-19 pandemic, the Hotel rolled out a “CleanStay” policy, which included several safety protocols, for its hotels. One of these protocols, to avoid exposing guests who feared COVID-19 to additional risk, was that guests would receive daily cleaning only if they asked.
While the Hotel was closed, the Hotel’s safety committee, composed of Hotel managers, union representatives and Hotel employees, continued to meet. A union representative later claimed that they asked management about the CleanStay policy during a safety committee meeting and were told that the policy would be implemented because guests did not want anyone coming into their rooms. The Hotel reopened in December 2020 with the CleanStay program in place, and all of the Hotel management’s communications with employees and the union stated that the program was implemented in accordance with the Hotel brand policy change.
In March 2021, the union requested guest surveys and other information from the Hotel concerning the policy change, claiming that the employer mentioned guest feedback at the prior safety committee meeting when explaining the CleanStay program. The Hotel rejected the request, stating that the information was not relevant because the policy change was based on the Hotel’s CleanStay program rather than guest concerns. The Hotel specifically refuted the union’s statements concerning the safety committee meeting and explained that management had said only that “it is the guest’s choice whether to request housekeeping service during the guest’s stay.” The union filed an unfair labor practice charge, claiming that the Hotel was withholding information relevant to the union’s representation of bargaining unit employees.
The Board issued a decision in favor of the union, affirming an administrative law judge’s ruling. The Board found that the union’s claim about what was said in the safety committee meeting, although factually contested by the Hotel, was sufficient to establish the union’s “reasonable belief” of relevance. The Board further found that even setting aside the union’s version of the safety committee discussion, Hotel management’s letter rejecting the information request justified the reasonable belief of relevance because the letter referenced “guest choice.” The Board ignored that management was refuting the union’s claim and ruled that the mention of guest choice in the letter constituted objective evidence justifying the union’s belief. Bottom line: Employers can expect to see a new union strategy — request now, justify later.
Takeaways
The Board’s ruling has significant implications for union information requests.
Previously, unions needed to demonstrate relevance by establishing a reasonable belief based on objective evidence.
Today, evidence seemingly need not be objective to establish relevance — information received after the request can be used to justify relevance.
Employers must carefully craft a response to a union’s request for information if the goal is to refrain from producing irrelevant information.
Posted in NLRB
The National Labor Relations Board issued a decision that reversed several Trump-era rulings allowing employers to proffer severance agreements to employees containing broad confidentiality and non-disparagement provisions. The Board’s decision holds that the “mere proffer” of a severance agreement containing a confidentiality and/or non-disparagement provision is unlawful where the clause is drafted too broadly and would “chill” an employee’s ability to exercise NLRA Section 7 rights.This is a far-reaching decision that impacts both union and non-union businesses.
Read the full alert for more information on how employers should prepare.
Posted in NLRB
“You get more remedies! You get more remedies! Everybody gets more remedies!”
Employers found to have committed an unfair labor practice (ULP) now may be required to compensate employees for interest and late fees on credit cards, penalties for early withdrawals from retirement accounts, out-of-pocket medical expenses, and other costs incurred to make ends meet. The National Labor Relations Board (NLRB or Board) recently held that employers must compensate employees for all direct or foreseeable pecuniary harms suffered as a result of the employer’s ULP. Thryv, Inc., 372 NLRB No. 22 (issued Dec. 13, 2022).
Posted in NLRB
Whether employers must continue to deduct union dues from employees’ paychecks and forward such deductions to the union (i.e., a “dues checkoff” provision) after the expiration of a collective bargaining agreement (CBA) is of critical importance in the negotiation process. Not having to deduct union dues is a powerful weapon for an employer to force a union to be reasonable at the bargaining table, since the union’s income stream with respect to the bargaining unit is cut off. By contrast, if the dues checkoff requirement survives the expiration of a CBA, there is much less incentive for the union to get a deal done since it is essentially “playing with the house’s money.”
Posted in NLRB
The issue of whether an employer can ban its employees from using the company email system for union organizing has been the subject of heated litigation before the National Labor Relations Board (NLRB or Board). Since its 2007 decision in Register Guard, 351 NLRB 1110, the Board has vacillated between finding that such bans unlawfully infringe upon employees’ right to engage in protected concerted activity (Purple Communications, Inc., 361 NLRB 1050 (2014)) and upholding such restrictions as protecting employers’ property rights (Caesars Entertainment d/b/a Rio All-Suites Hotel & Casino, 368 NLRB No. 143 (2019)). In the most recent case, T-Mobile USA, Inc. & Communications Workers of America, NLRB, 14-CA-155249 (Sept. 30, 2022), a three-member NLRB panel – made up of the Board’s two Republicans and one of the Board’s three Democrats – found that T-Mobile unlawfully disciplined an employee when it (1) selectively and disparately enforced its email policy against an employee for sending a union-related email, (2) established rules prohibiting mass emails for nonbusiness purposes in response to the employee’s union activity, and (3) told the employee that employees could not send union-related emails to work addresses.
Posted in NLRB
We’ve all heard before that consistency is the key to success. The U.S. Court of Appeals for the District of Columbia Circuit’s decision in Constellium Rolled Products Ravenswood, LLC v. NLRB, No. 21-1191 (D.C. Cir. 2022), illustrates this simple but crucial principle. In a 2-1 decision, the court held that the National Labor Relations Board (NLRB or Board) had sufficient justification for its finding that Constellium Rolled Products (Constellium) committed an unfair labor practice when it terminated an employee who wrote “whore board” on an overtime sign-up sheet.
