Adjunct Law Prof Blog

DC Circuit Reverses Board In Campaign Threat Case

The DC Circuit holds that the NLRB lacked substantial evidence to support its conclusion that a hospital executive's comments during a union organizing campaign conveyed a threat to employees. Flagstaff Med. Ctr. Inc. v. NLRB, ___F.3d____(D.C. Cir. April 26, 2013). 

A divided Board  found that the employer's President illegally threatened employees when he told them in a campaign meeting that he would not negotiate if the union was certified. But the court found that while the President told employees he would not personally participate in negotiations, he never ruled out the possibility negotiations would occur.

The court also rejected NLRB's conclusion that the hospital fired a union supporter because of his union activity. Rather, the court concluded that there was ample proof the employee was fired for attendance problems.

Mitchell H. Rubinstein

Former Chairman Liebman Supports Senate Action on NLRB Nominees

Former NLRB Chairman Liebman recently wrote an opt ed piece calling for the Senate to take action on the 5 nominees to the NLRB. That article can be found here. Chairman Liebman states in part:

Mitchell H. Rubinstein

Breaking News. 3rd Circuit Follows DC Circuit By Invalidating NLRB Craig Becker Appointment

In a 102 page opinion released a majority of the 3d Cir. (Smith and Van Antwerpen) agreed with the D.C. Cir. that recess appointments can only be made during a recess between congressional sessions.  Judge Greenaway wrote a 55 page dissent.  The majority held that Craig Becker's appointment on March 27, 2010, was invalid.  The case is NLRB v. New Vista Nursing and Rehabilitation, Nos. 11-3440, 12-1027, and 12-1936.

Law Review commentary on this important topic, which will likely go to the Supremes, would be most welcome.

Mitchell H. Rubinstein

NLRB Petitions Supreme Court to Review Ruling on Recess Appointments

As expected, the NLRB filed  petition asking the U.S. Supreme Court to review a recent DC Circuit decision which held unconstitutional President Obama's January 2012 recess appointments to the board (NLRB v. Noel Canning Div. of Noel Corp.,  petition filed 4/25/13).

The petition asserts that the decision of the District of Columbia Circuit (705 F.3d 490 (D.C. Cir. 2013), "would dramatically curtail the scope of the President's authority under the Recess Appointments Clause" of the U.S. Constitution if the appeals court ruling is allowed to stand.

Mitchell H. Rubinstein

NLRB Asserts Jurisdiction Over Charter School

The NLRB recently held that a private company that provides teaching staff and educational services to a Chicago charter school is an employer subject to the board's jurisdiction and not a political subdivision of the state of Illinois (Pilsen Wellness Ctr., 359 N.L.R.B. No. 72, 3/8/13 [released 3/11/13]).

Applying the Supreme Court's Hawkins decision, the Board finds that Pilsen's directors are appointed by the private nonprofit's sitting board members rather than public officials, NLRB concludes the company “is not administered by individuals who are responsible to public officials or the general electorate.”

Mitchell H. Rubinstein 

2d Circuit Issues Major Decision On Indefensbile Conduct

NLRB v. Special Touch, ___F.3d___(2d Cir. Feb. 27, 2013), is a major decision which outlines when striker could loose protection for striking by engaging "indefensible conduct."  Here, although the union gave the required 8(g) 10 days notice of striking a health care institution, 48 strikers mislead the employer into thinking that they were going to show up. As the court explained:

Despite the fact that forty-eight aides never started
 work on June 7, 2004, it can still be said that foreseeable
imminent danger resulted from their “sudden cessation of
work.” Until approximately twenty minutes after each of the
forty-eight aides’ shifts began, Special Touch believed that
it had these patients covered.

Mitchell H. Rubinstein

Important NLRB Excelisor Decision

International Brotherhood of Teamsters, 359 NLRB No. 67 (Feb. 14, 2013), is an important case concerning Excelsior lists. The Board reaffirmed the principle that there is no ULP if the employer substantially complied, reasoning:

We disagree with the hearing officer’s conclusion.
Under Woodman’s Food Markets, 332 NLRB 503
(2000), the Board considers several factors in determining
whether an employer has substantially complied with
the Excelsior requirements, including the percentage of
voters omitted from the Excelsior list, the employer’s
reasons for omitting the voters’ names, and whether the
number of voters omitted constitute a determinative
number of votes. In the present case, we find that the
relevant Woodman’s factors support a finding that the
Employer substantially complied with the Excelsior requirements:
the percentage of voters omitted from the list
is relatively small (15.4 percent), there is no showing of
bad faith on the part of the Employer, and, perhaps most
importantly, the number of voters omitted from the list
does not constitute a determinative number. In reaching
a contrary conclusion, the hearing officer relied in part
on the Board’s decision in Automatic Fire Systems, 357
NLRB No. 190 (2012), but we find that case distinguishable
in two significant respects. First, the present case
involves a two-union election in which all employees
indicated their preference for representation and in which
both unions were equally affected by the Excelsior list
omissions. Second, there is no showing here that the
Employer intentionally omitted an entire segment of its
work force.

The NLRB needs to be more careful in writing decision because a 15.4 percent error rate is no 

small error. I am sure that employer's are going to to argue that errors less than 15.4 percent are

not material and that is clearly not what the Board meant.

Mitchell H. Rubinstein

Rare 2d Circuit Decision Holding Individual Shareholder Liable for ULP's

Salm v. NLRB,____F.Appx. ____(2d Cir. Jan. 30,2013), is an important case. The 2d Circuit in an unreported decision affirmed the NLRB's remedial order which pierced the corporate veil and found individual shareholders personally liable for unfair labor practices. As the court explained:

In the context of federal labor law and enforcement of orders of the NLRB, it remains the
case that the “insulation of a stockholder from the debts and obligations of his corporation is the
norm, not the exception.”  NLRB v. Deena Artware, Inc., 361 U.S. 398, 402-03 (1960).  This
general norm, however, is not inviolate.  To pierce the corporate veil, the NLRB applies the twoprong test laid out in White Oak Coal Co., 318 N.L.R.B 732, 734-35 (1995), enforced, 81 F.3d
150 (4th Cir. 1996).  Under this test, the NLRB may pierce the corporate veil and impose
personal liability on a shareholder or owner if “(1) there is such unity of interest, and lack of
respect given to the separate identity of the corporation by its shareholders, that the personalities
and assets of the corporation and the individuals are indistinct, and (2) adherence to the

corporate form would sanction a fraud, promote injustice, or lead to an evasion of legal
obligations.”  White Oak Coal, 318 N.L.R.B. at 735.  
In analyzing the first prong, the NLRB examines a host of specific factors, including:
(1) whether the corporation is operated as a separate entity; (2) the commingling of funds
and other assets; (3) the failure to maintain adequate corporate records; (4) the nature of
the corporation’s ownership and control; (5) the availability and use of corporate assets,
the absence of same, or under capitalization; (6) the use of the corporate form as a mere
shell, instrumentality or conduit of an individual or another corporation; (7) disregard of
corporate legal formalities and the failure to maintain an arm’s-length relationship among
related entities; (8) diversion of the corporate funds or assets to noncorporate purposes;
and, in addition, (9) transfer or disposal of corporate assets without fair consideration.
Id.  Of these, “[n]o one factor is determinative, and not all of these factors must be present.”
NLRB v. Bolivar-Tees, Inc., 551 F.3d 722, 728-29 (8th Cir. 2008).  While based on one major
transaction, the Board rightly concluded that an analysis of these factors showed that Salm had
indeed abused the corporate form to such a degree—by drawing down virtually all of the assets
of the Domsey Trading Corporation for his personal use—that the first prong of the White Oak

had been met.

Mitchell H. Rubinstein

 

7th Circuit Authorizes Arrest of Owner For Contempt in Failing To Comply With NLRB Case

NLRB v. HH3 Trucking, ___F.3d____, 194 LRRM 3266(7th Cir. Jan. 10, 2012), is one of those case you do not see very often. The owners of a company found to have committed a ULP refused to comply with an NLRB backpay order and were found in contempt. After they continued to refuse to comply, the court ordered their arrest. 

Mitchell H. Rubinstein

2d Circuit Decision On Effects Bargaining

Everything you wanted to know about decision and effects bargaining as well as waiver. 

IBEW v. Rochester Gas & Electric, ____F.3d___(2d Cir. Jan. 17, 2013).

Chamber Urges Employers to Appeal Prior Adverse Board Rulings

The U.S. Chamber of Commerce published a reprint of a Wall Street Journal Article and is urging its members to appeal any adverse NLRB decision under the D.C. Circuit's recent decision in Noel Cannning holding that the NLRB was powerless to act because it did not have a quorum, here. 

Hat Tip: Workplace Prof Blog

Mitchell H. Rubinstein

 

Senator Rand Paul Introduces Anti-Union Amendment To NLRA

Tea Party favorite Sen. Rand Paul (R-Ky.) introduced a bill (S. 204) that would amend the National Labor Relations Act to bar the inclusion of union security clauses in collective bargaining agreements, which require the payment of union dues or fees as a condition of employment. The proposed National Right-to-Work Act also would amend the Railway Labor Act. The bill currently has 10 co-sponsors, all Republicans.

Expect it to go nowhere, but it demonstrates that there are a number of anti-union Senators in the Congress.

Mitchell H. Rubinstein

NLRB Overrules Anheuser-Busch Precedent, Favors Balancing Test on Witness Statements

The Labor Board on December 14, 2012 overruled a 36-year-old “bright-line rule” that denied labor organization representatives access to witness statements obtained by unionized employers, finding NLRB should balance the interests of unions and employers in assessing union requests for the names or statements of witnesses interviewed during a company investigation (Am. Baptist Homes of the W. d/b/a Piedmont Gardens,359 N.L.R.B. No. 46, 12/15/12 [released 12/21/12]).

NLRB Chairman Mark Gaston Pearce and Members Richard F. Griffin and Sharon Block said the U.S. Supreme Court has approved the board's balancing a union's need for relevant information against legitimate and substantial employer interests in keeping information. The board held in Anheuser-Busch Inc., 237 N.L.R.B. 982, 99 LRRM 1174 (1978), that witness statements were distinguishable from other information, but Pearce, Griffin, and Block found that witness statements relevant and necessary to a union's representation of employees are “fundamentally the same” as other information an employer must provide to a bargaining agent.

Member Brian E. Hayes dissented from the overruling of Anheuser-Busch, arguing that exempting witness statements from disclosure supported employer efforts to secure the participation of workers in investigations, and protected participating employees from retaliation or harassment by unions or co-workers.

Hat Tip: Daily Labor Report

Mitchell H. Rubinstein

Congressional Research Service Issues Important Report on Noel Canning Decision

The Congressional Research Service issued an important report documenting that if the NLRB Noel Canning decision is correct, then over three hundred recess appointments since 1981 would be declared invalid. A copy of the report is available here and it is worth a read for those interested. NY Times commentary on this important issue is available here.

Mitchell H. Rubinstein

NYC Bus Strike Not IIlegal

The NLRB Office of General Counsel just issued an opinion indicating the current NYC Transit strike is not illegal. Here. 

Mitchell H. Rubinstein

D.C. Circuit Remands NLRB Rulings on T-Shirt, Provocative Language Policy

From the Daily Labor Report, Dec. 14, 2012:

The District of Columbia Circuit remands an unfair labor practice case to the National Labor Relations Board, finding the board failed to explain its conclusions that Medco Health Solutions of Nevada Inc. interfered with employee rights by asking an employee to remove a union-sanctioned T-shirt and by maintaining a ban on insulting, provocative, and confrontational messages on employee clothing (Medco Health Solutions of Las Vegas Inc. v. NLRB, D.C. Cir., No. 11-1282, 12/14/12).

Writing for the court, Judge Williams says the company made a "straightforward" argument that pharmacy worker Michael Shore wore a shirt that was insulting to Medco and harmful to the company's effort to attract and retain customers, who occasionally toured the facility where Shore worked. NLRB found Medco's claim of harm to customer relations lacked evidentiary support, but Williams says the board failed to adequately explain what evidence was required.

 

NLRB Issues Major Decision Imposing Bargaining Obligation Over Discipline Before Union Reaches Conract

 Alan Ritchey Inc., 359 N.L.R.B. No. 40, 12/14/12 [released 12/19/12]), is a major NLRB decision. The time after a union is certified until it reaches its first contract is often long and difficult. This decision holds, for the first time, that an employer MUST bargain with the union BEFORE imposes major discipline on unit employees notwithstanding the fact that a CBA has not been reached. As the NLRB stated:

Not every unilateral change that affects terms and conditions
of employment triggers the duty to bargain.
Rather, the Board asks “whether the changes had a material,
substantial, and significant impact on the employees’
terms and conditions of employment.” Toledo
Blade Co., 343 NLRB 385, 387 (2004) (emphasis
added). This test is a pragmatic one, designed to avoid
imposing a bargaining requirement in situations where
bargaining is unlikely to produce a different result and,
correspondingly, where unilateral action is unlikely to
suggest to employees that the union is ineffectual or to
precipitate a labor dispute. We draw on this basic principle,
adjusted to fit the present context, today. Disciplinary
actions such as suspension, demotion, and discharge
plainly have an inevitable and immediate impact on employees’
tenure, status, or earnings. Requiring bargaining
before these sanctions are imposed is appropriate, as
we will explain, because of this impact on the employee
and because of the harm caused to the union’s effectiveness
as the employees’ representative if bargaining is
postponed. Just as plainly, however, other actions that
may nevertheless be referred to as discipline and that are
rightly viewed as bargainable, such as oral and written
warnings, have a lesser impact on employees, viewed as
of the time when action is taken and assuming that they
do not themselves automatically result in additional discipline
based on an employer’s progressive disciplinary
system. Bargaining over these lesser sanctions—which
is required insofar as they have a “material, substantial,
and significant impact” on terms and conditions of employment—
may properly be deferred until after they are
imposed

 

Seventh Circuit Ducks NLRB Quorum Issue, Finds Employee Challengers Lacked Standing

The Seventh Circuit Dec. 26 dismissed two petitions by employees who sought to challenge the constitutionality of President Obama's recess appointments of National Labor Relations Board members, finding the employees suffered no injuries from the NLRB rulings they appealed and lacked standing to obtain court review of the appointments ( Richards v. NLRB, 7th Cir., No. 12-1973, 12/26/12 )

Recess Appointments and The NLRB

The power of the Preisdent to make recess appointments to the NLRB is currently being challenged in the D.C. Circuit. An article about this important case in the National Law Journal can be found here.

Mitchell H. Rubinstein

D.C. Circuit Backs NLRB on Request for Data on Competitive Pressure

From the December 4, 2012 Daily Labor Report:

The District of Columbia Circuit enforces 2-1 a National Labor Relations Board order that required an Ohio manufacturer to give the United Auto Workers information about customers and pricing to support the company's claim it was experiencing competitive pressures that required it to seek substantial wage reductions from its employees (KLB Indus. Inc. v. NLRB, D.C. Cir., No. 11-1280, 12/4/12)

Mitchell H. Rubinstein