NLRB joint employer issue may go to rulemaking

Really, what's next? The NLRB is now considering using its rulemaking authority to address the standard for determining joint employer status under the National Labor Relations Act. [Press release] Meanwhile, there's a minor Twitter war between Chairman Ring, Member Lauren McFerran, and Member Mark Gaston Pearce. What is this? Junior High School?

My guess is that the Board majority has been looking for a case in which neither Chairman Ring nor Member Emanuel has a conflict of interest – a tough job because they both came out of a huge law firms that represent parties in Board cases.

So the Board is considering using rulemaking. That's typically a much slower process than deciding an actual case, but in today's climate it might be faster.

In December 2017 the Board decided Hy-Brand Industrial Contractors, Ltd. (Hy-Brand I), 365 NLRB No. 156 (2017) [PDF], which overruled Browning-Ferris Industries, 362 NLRB No. 186 (Aug. 27, 2015). This changed the rules for determining when a company is considered a "joint employer." Hy-Brand I adopted a "direct control" test rather than Browning-Ferris' "indirect control" test.

Then in February three Members (not including William Emanuel) vacated Hy-Brand I, having decided that Emanuel ought not to have participated. Hy-Brand Industrial Contractors, Ltd. (Hy-Brand II), 366 NLRB No. 26 (2018) [PDF]. It's pretty clear that Emanuel was blind-sided by this action.

I think the handwriting on the wall is pretty clear. Right now the Browning-Ferris standard prevails. Just as quickly as the Board majority can get it done (either through rulemaking or by deciding a case), they will adopt the standard articulated in Hy-Brand I.


Fast food store employees vote for union – first in the country

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Portland. Oregon. Of course.

For the first time ever, a fast food store has unionized following an NLRB election. On April 23 workers at Burgerville voted 18-4 in favor of being represented by Industrial Workers of the World (IWW) [often known as Wobblies], Portland Chapter, d/b/a Burgerville Workers Union.

So now the question is whether this is a flash in the pan or the opening of nation-wide floodgates.

Mark Medina, a worker at the store, said, “Burgerville leaves a lot of us workers poor, hungry, and homeless. “With the company’s use of e-verify, some of us even face possible deportation.”

“Employees at Burgerville Store #41 have voted to unionize in the fair and free election overseen by the NLRB. Our employees have spoken, we hear them, and we support their decision. We will navigate this new working relationship together in a positive, productive way and bargain in good faith with the union at Burgerville Store #41,” said Beth Brewer, Senior VP of Operations for Burgerville. “We are proud of our relationship with our coworkers, and we will continue to provide a fair, positive work environment for all.” "With the same pioneering spirit that Burgerville is known for, we are ready to support the nation’s first unionized fast-food store.”

Burgerville is a regional chain, operating in Oregon and Southwest Washington.


NLRB looks at 2018

The NLRB now is back to its full five Members, with a Republican majority and a new Chairman – John Ring. The General Counsel has shared his vision of the NLRB's future. See NLRB's GC's Roll-Back Agenda.

Changes that are in the wind involve both unionized and non-union workplaces:

Joint employers Flip Flop. Hy-Brand Industrial Contractors (NLRB 12/14/2017) [Decision] overruled Browning-Ferris Industries, 362 NLRB No. 186 (2015) and returned to the pre-Browning Ferris standard that governed joint-employer liability. But wait! The Board vacated Hy-Brand. Hy-Brand Industrial Contractors (NLRB 02/26/2018) [PDF] because Member William Emanuel had a conflict of interest. So Browning-Ferris is still with us – until the Republicans' new majority sorts things out.

Election Rule. In 2014 the Board adopted a new election rule [NLRB fact sheet] intended to decrease the time preceding union elections, thus sometimes called the "quickie election rule." The new Board has issued a "Request for Information" [Full text] – the first step in the inevitable roll-back of the Board's controversial 2014 Election Rule. The time for submitting comments has expired. View comments [HERE]. For more, see NLRB signals Election Rule roll-back; NLRB election rule comment period extended.

Class-action waivers. In D.R. Horton (2012) [Board decision] [not enforced by 5th Cir], the NLRB said that it's an unfair labor practice for an employer to require employees to agree that they will not bring a class-action or collective-action case, either in litigation or in arbitration. Federal circuit courts are split on this, and the issue is now before the US Supreme Court (Epic Systems v. Lewis, consolidated with two other cases). A decision is expected at any moment. See NLRA v. FAA – US Supreme Court will decide class-action waiver cases; Delayed arguments in class-action waiver case; Dissecting SCOTUS' class-action argument.

Deferral to arbitration. Babcock & Wilcox (2014) [Board decision] modified Olin Corp (1984) to make it more difficult to obtain deferral to arbitration awards, grievance/arbitration proceedings, and pre-arbitration grievance settlements.

Joint representation. Miller & Anderson (2016) [Board decision] overruled Oakwood Care Center (2004) and held that a union seeking to represent employees in bargaining units that combine both solely and jointly employed employees of a single user employer are no longer required to obtain employer consent.

College students. Columbia University (2016) [Board decision] overruled Brown University  (2004) and held that college student assistants are statutory employees, and the fact they are also students does not change their status as employees.

Employer's email system. Purple Communications (2014) [Board decision] (reaffirmed in 2017) overruled Register Guard (2007) and held that employees may use their employer's email system for protected communications on nonworking time.

Union dues check-off. WKYC-TV (2012) [Board decision] overruled Bethlehem Steel (1962) and held that a dues check-off provision in a collective bargaining agreement remains in force after the collective agreement has expired.


Republicans regain majority at NLRB

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The Senate on April 11 confirmed (by 50-48 vote) Republican John Ring as a Member of the National Labor Relations Board. Thus, Republicans now have a 3-2 majority, and can resume the roll-back of Obama era Board decisions. For some examples, see NLRB Watch.

What's John Ring's history?

+ John Ring was a lawyer with Morgan, Lewis & Bockius LLP, practicing out of the Washington, DC office.
+ Co-leader of the Morgan Lewis labor/management relations practice.
+ Office practice leader for the labor and employment practice.
+ Hiring partner for the Morgan Lewis Washington, DC office.
+ Counsel to a number of national negotiating teams, including for the National Master Freight Agreement.
+ Co-counsel to a number of multiemployer benefits funds.
+ Negotiates and administers labor contracts.
+ Advisor on large-scale workforce restructuring and consolidations and reduction-in-force (RIF) issues.
+ Counsels on ADA, FMLA, & WARN issues.
+ B.A. degree, Catholic University of America, 1985.
+ Law degree, Catholic University of America, Columbus School of Law, 1989.
+ Fellow, College of Labor and Employment Lawyers.
+ President, Friends of the National Zoo Board of Directors.

More details about John Ring are on the Morgan Lewis website [HERE].


NLRB's Hy-Brand soap opera accelerates

The NLRB's General Counsel is ripping the Board for denying litigants' due process rights and deviating from long-held practice by ex post facto disqualifying Member Emanuel from voting on the second round of the Hy-Brand case. The GC dropped its little bomb on April 5 - a brief in opposition to reconsideration of the Board's order which vacated the original Hy-Brand decision [PDF].

In December 2017 the Board, with Emanuel's participation, decided Hy-Brand Industrial Contractors, Ltd. (Hy-Brand I), 365 NLRB No. 156 (2017) [PDF], which overruled Browning-Ferris Industries, 362 NLRB No. 186 (Aug. 27, 2015). This changed the rules for determining when a company is considered a "joint employer." Hy-Brand I adopted a "direct control" test rather than Browning-Ferris' "indirect control" test.

Then in February three Members (not including Emanuel) vacated Hy-Brand I, having decided that Emanuel ought not to have participated. Hy-Brand Industrial Contractors, Ltd. (Hy-Brand II), 366 NLRB No. 26 (2018) [PDF]. It's pretty clear that Emanuel was blind-sided by this action.

The GC now wants the Board to set aside Hy-Brand II, basically for the following reasons:

1. Emanuel should have been allowed to rule on the motion for his recusal. That's been the long-standing practice at the NLRB and at other agencies.

2. It was not proper for three Board Members to vacate a decision that was made by five Members, especially when the Board had four Members.

3.  Arguably, Emanuel had a right to sit on the Hy-Brand II case.

4. The Board violated the parties' due process rights, essentially because they were not given notice and an opportunity to respond to the Board's plan to vacate Hy-Brand I.

How will all this end? There's no way to tell. For right now we're seeing some pretty hot words being thrown by a Republican General Counsel toward Republican Board Members.


NLRB signals change in successorship analysis

Two NLRB Members dropped a footnote indicating that they are ready to revise the analysis of when an employer is a successor under the "perfectly clear" doctrine. Walden Security, Inc., 366 NLRB No. 44 (03/23/2018) [PDF]. So we can expect a change to be coming once the NLRB returns to its full complement of Member – with a Republican majority.

This all goes back to NLRB v. Burns Security Services, 406 U.S. 272 (1972), and Spruce Up Corp., 209 NLRB 194 (1974), and a series of more recent cases interpreting Spruce Up. Specifically, those cases adopt the position that an employer can be found to be a “perfectly clear” successor if it expressed an intent to retain the predecessor’s employees without making it clear that employment would be conditioned on the acceptance of new terms and conditions of employment.

Here is the footnote:

"We adopt the judge’s finding that, under extant precedent, the Respondent was a 'perfectly clear' successor because it expressed an intent to retain the predecessor’s employees without making it clear that employment would be conditioned on the acceptance of new terms and conditions of employment. Chairman Kaplan notes that the judge’s analysis relied on the interpretation of Spruce Up Corp., 209 NLRB 194 (1974), enfd. 529 F.2d 516 (4th Cir. 1975), in Creative Vision Resources, LLC, 364 NLRB No. 91 (2016), enfd. 882 F.3d 510 (5th Cir. 2018), Nexeo Solutions, LLC, 364 NLRB No. 44 (2016), and Canteen Co., 317 NLRB 1052 (1995), enfd. 103 F.3d 1355 (7th Cir. 1997). As previously stated, he disagrees with that interpretation. See First Student Inc., A Division of First Group America, 366 NLRB No. 13, slip op. at 7 (2018) (Chairman Kaplan, dissenting in part). However, he recognizes that these decisions are extant precedent, which applies here in the absence of three votes to overrule them. Moreover, he would find that the Respondent here was a 'perfectly clear' successor even under a narrower interpretation of Spruce Up because it unequivocally offered to employ any interested employee of the predecessor employer without indicating prior to or simultaneously with that offer that there would be new terms and conditions of employment. Member Emanuel agrees that the Respondent was a 'perfectly clear' successor under the facts of this case. However, he is open to reexamining the Board’s 'expresses an intent to hire' standard in an appropriate future case."