• The U.S. Supreme Court accepted review of a decision by the U.S. Court of Appeals for the District of Columbia holding that the president’s recess appointments to the National Labor Relations Board (“NLRB” or “Board”) were unconstitutional. In its groundbreaking January 25, 2013 decision, the D.C. Circuit in Noel Canning v. NLRB ruled that the President’s January 2012 recess appointments to the NLRB were unconstitutional because the constitution’s Recess Appointments Clause only allows appointments during intersession congressional recesses and only when vacancies arise during an intersession recess. In accepting review of the case, the Supreme Court asked the parties to brief one additional issue: whether the President can make recess appointments when the Senate is convening pro forma sessions every three days, as the Senate was doing when the President made his recess appointments. NLRB v. Noel Canning, Case No. 12-1281.
  • The U.S. Supreme Court also accepted a petition for certiorari from Unite Here Local 335 to review a decision by the U.S. Court of Appeals for the Eleventh Circuit holding that the union’s neutrality agreement with Mardi Gras Gaming, a dog track company, violated the Labor Management Relations Act (“LMRA”). Under the parties’ neutrality agreement, the company agreed to remain neutral when the union tried to organize its workers and agreed to provide the union with organizing space and a list of employee information. The Eleventh Circuit held that depending on the parties’ intent, such an agreement could violate the LMRA’s prohibition on employers giving or lending anything of value to a labor union. Other circuit courts of appeals have held that similar neutrality agreements do not violate the LMRA. Unite Here Local 355 v. Mulhall, Case No. 12-99.
  • On June 14, the U.S. Court of Appeals for the Fourth Circuit struck down the NLRB’s proposed rule that would require employers to post notices of employee rights under the National Labor Relations Act (“NLRA” or “Act”). The court held that the NLRA did not give the NLRB authority to issue such a rule. In so holding, the Fourth Circuit joined the U.S. Court of Appeals for the District of Columbia in striking down the NLRB’s notice posting rule. The NLRB argued that it had authority to promulgate the rule because Section 6 of the NLRA provides that the Board may adopt “such rules and regulations as may be necessary to carry out the provisions of the Act.” In rejecting this argument, the Fourth Circuit explained that Section 6 authorizes the Board to adopt rules to carry out specific provisions of the act; Section 6 does not give the Board general rule-making authority. The court further noted that the NLRA envisions the Board as a reactive body, responding to unfair labor practice charges and petitions for representation elections. Finally, the Fourth Circuit observed that other statutes—like Title VII and the Age Discrimination in Employment Act—explicitly provide for an agency to require employees to post notices, but the NLRA does not provide the NLRB with similar authority. Chamber of Commerce v. NLRB, Case No. 12-1757 (4th Cir. June 14, 2013).
  • On May 30, telecommunications firms CSC Holdings LLC and its subsidiary, Cablevision Systems New York City Corp., filed a petition for a writ of mandamus with the U.S. Court of Appeals for the District of Columbia seeking to block the NLRB from processing unfair labor practice complaints against the companies. In their petition, the companies cited the D.C. Circuit’s Noel Canning decision and argued that because the Board lacks a quorum without the unconstitutional recess appointees, it lacks authority to act, which means the regional directors—acting as the Board’s agents—also lack authority to issue complaints. The companies argued that the D.C. Circuit must stop the NLRB from proceeding with the complaints or the companies will be forced to engage in a costly defense before they can seek review of any adverse rulings in the D.C. Circuit. In re: CSC Holdings LLC, Case No. 13-1191 (D.C. Cir.).
  • The U.S. Court of Appeals for the Second Circuit held that Connecticut’s former Governor, John Rowland, and former Policy and Management Secretary, Mark Ryan, violated the First Amendment by terminating 2,800 state employees in 2003. The terminations arose after unions representing state workers refused to agree to Connecticut officials’ proposed benefit cuts for state workers. Connecticut officials did not terminate any non-union state employees. Relying on Supreme Court decisions in the political affiliation context, the Second Circuit found that the First Amendment protects employees’ free association right to join trade unions. The court further found that a state may not condition continued public employment on employees’ union affiliation unless the state can justify that condition based on a compelling interest, and can show that it used narrowly tailored means to pursue that interest. The court held that that the Connecticut officials could not demonstrate a compelling interest in terminating only union-affiliated state employees, because benefits for union and non-union employees cost the state the same amount. State Employees Bargaining Agent Coal v. Rowland, Case No. 11-3061 (2d Cir. May 31, 2013).
  • A NLRB administrative law judge (“ALJ”) ruled that MasTec Services Co., Inc. violated the NLRA by maintaining a policy requiring workers to arbitrate individual employment disputes against their employer. The ALJ acknowledged that MasTec’s policy differed from that found unlawful in the Board’s D.R. Horton decision because MasTec gave employees 30 days to opt-out of the arbitration procedure after they were given the company’s employee handbook containing the policy. But, the ALJ concluded this opt-out provision did not save the policy because he found that employees should not be required to take affirmative steps to preserve their right to act collectively. The ALJ also found that employees may be afraid to opt out of the arbitration policy for fear of retaliation. MasTec Services Co. Inc., NLRB Case No. 16-CA-086102 (June 3, 2013).
  • Also last month, a different NLRB ALJ ruled that Bloomingdale’s Inc. did not violate the NLRA by enforcing a class action waiver in the company’s arbitration agreement. The ALJ distinguished the NLRB’s decision in D.R. Horton because Bloomingdale’s allowed employees 30 days to opt-out of the arbitration procedure after employees received the policy. In addition to the MasTec decision above, last November, yet another ALJ held that fitness franchise 24 Hour Fitness violated the NLRA by enforcing a class arbitration waiver despite a similar opt-out provision. 24 Hour Fitness is currently on review before the NLRB. Bloomingdale’s Inc., Case No. 31-CA-071281 (June 26, 2013).
  • The NLRB voided a representation election in which the International Alliance of Theatrical Stage Employees (“IATSE”) Local 720 won by one vote the right to represent stage hands and technicians at the Bellagio Las Vegas hotel and casino. The NLRB found that members of the proposed bargaining unit would have concluded that an IATSE member, Alphonse Torres, spoke on behalf of the union when he threatened a potential voter, saying the voter would be “toast” once the union won recognition. The threatened employee repeated this remark to two other Bellagio employees. Torres did not work for the union, but the Board found that the union gave that impression when it permitted him to attend and speak during an organizing meeting. The Board directed that a rerun election be held. Bellagio LLC, 359 NLRB No. 128 (May 31, 2013).
  • An ALJ held that the American Red Cross violated the NLRA by maintaining a policy that prohibited workers from disclosing confidential information. The policy defined confidential information to include “personnel” information. The ALJ found that employees could reasonably interpret the provision as restricting discussion of wages and terms and conditions of employment. Even though the policy included a “savings clause,” which stated that the policy did not infringe on employees’ labor law rights, the ALJ concluded employees might not be aware that they had the right to disclose their wages and terms of employment. The ALJ further found that the Red Cross did not violate the NLRA by maintaining a policy prohibiting employees from using the organization’s trademark without permission. While the NLRA protects employees’ rights to use an employer’s trademark when protesting labor conditions, the ALJ found that the Red Cross had not applied the policy to infringe employees’ rights and, based on the context of the provision, employees would not interpret the policy as restricting their NLRA rights. American Red Cross Blood Services, Case No. 08-CA-090132 (June 4, 2013).
  • The New Mexico Supreme Court ruled that the State Personnel Board, an agency authorized to negotiate and execute labor contracts with unions representing state workers, breached collective bargaining agreements by granting wage increases to 10,000 non-union state workers during a pay freeze. The case arose out of collective bargaining agreements the Personnel Board entered in 2005 with unions representing state workers. These agreements provided for periodic wage increases. In 2008, the legislature allocated money sufficient to pay for the increases slated for 2009. But after then-Governor Bill Richardson instituted a pay freeze, the Personnel Board lowered the contract wage increase to a flat 2.9 percent. The Personnel Board then used some of the money the legislature allocated to pay for the wage increases to provide a similar 2.9 percent wage increase to 10,000 non-union state workers. This action, according to the New Mexico Supreme Court, breached the collective bargaining agreements. As a result of this ruling, the state may be forced to pay wage increases as specified in these collective bargaining agreements to some 20,000 union workers, costing approximately $23 million. New Mexico v. AFSCME Council, Case No. 33792 (N.M. May 30, 2013).
  • The NLRB ruled that the CWA violated the NLRA by requiring non-union members to object annually in order to avoid being required to pay full union member dues. Under the NLRA, a non-union member may object to paying dues that go towards certain activities—like funding political causes—that are unnecessary for the union to perform its role as the collective bargaining representative for the particular workforce at issue. The NLRB has previously held that a union may only require non-union members to object annually to full payment of dues if the impact of requiring annual objections is negligible or if the union has a legitimate justification for the rule. In this case, the CWA argued that it had a legitimate justification for the rule: it enabled the union to gather information that it could use to evaluate how it was perceived among the workers it represents. In rejecting this justification, the Board found that the CWA never showed that it used this information and that information gathering alone was an insufficient justification. Communications Workers of America, 359 NLRB No. 131 (June 10, 2013).
  • The U.S. District Court for the Northern District of California denied a motion to dismiss a complaint by the National Union of Healthcare Workers (“NUHW”) alleging that Kaiser Permanente violated Section 302 of the LMRA by fast-tracking approval of union employees’ paid-leave requests to help the incumbent union defeat NUHW’s contest to represent Kaiser’s workers. Under Section 302 of the LMRA, employers are prohibited from making payments to a labor organization. The court held that Kaiser’s accelerated approval of paid-leave requests qualified as an “indirect contribution” to the incumbent union, the Service Employees International Union-United Healthcare Workers (“SEIU-UHW”), because the employees that went on leave focused on campaigning on behalf of the incumbent union. In its motion to dismiss, Kaiser argued that the controversy was moot because SEIU-UHW won the NLRB-supervised representation contest. The court rejected this argument, finding that a similar dispute could reoccur in the future. Nat’l Union of Healthcare Workers v. Kaiser Found. Health Plan Inc., Case No. 10-cv-3686 (N.D. Cal. June 12, 2013).
  • The U.S. Court of Appeals for the Fifth Circuit refused to enforce an NLRB decision holding that the Independent Electrical Contractors of Houston Inc., a contractor trade association, violated the NLRA by maintaining a job applicant referral arrangement that enabled the association’s members to avoid hiring union “salts.” The Fifth Circuit held that the Board’s decision violated the association’s due process rights. The case arose when the International Brotherhood of Electrical Workers (“IBEW”) Local 716 filed unfair labor practice charges against the association. The IBEW Local 716 had initiated a “salting” campaign against the organization’s members, whereby union members could apply to work for non-union contractors with the aim of organizing the contractors’ employees. The association maintained several referral practices that limited the likelihood its members would hire union salts, including failing to keep records of which job applications the association submitted to its members, the association’s refusal to tell applicants whether members had received their applications, and a “selectively-imposed $50 fee for additional [job] applications.” The NLRB General Counsel’s complaint alleged that the association’s practices violated Section 8(a)(3) of the NLRA, and derivatively violated Section 8(a)(1). An ALJ agreed. On review, the Board held that the referral arrangement violated Section 8(a)(1) only. The Fifth Circuit held that because the NLRB General Counsel’s complaint did not include an independent Section 8(a)(1) violation, the Board’s ruling violated the association’s due process rights. Independent Elec. Contractors of Houston Inc. v. NLRB, Case No. 10-60822 (5th Cir. June 17, 2013).
  • The National Mediation Board declined to postpone an election contest initiated by the IBT to oust incumbent unions at American Airlines and US Airways until the two companies complete their merger. The IBT is seeking to represent mechanics at US Airways and American Airlines, which are currently represented by the IAM and the Transport Workers of America, respectively. In approving the IBT’s petition for an election at US Airways, the Board found that it lacked precedent to postpone the election contest until the two airlines merged. The Board further found that under its enabling statute, the Railway Labor Act, the Board must resolve representation contests “as expeditiously as possible.” The IAM and TWA currently have an agreement to jointly represent workers once the airlines merge. In re: US Airways, 40 N.M.B. No. 60 (June 6, 2013).
  • The NLRB held that Weyerhaeuser Co., a pulp and paper manufacturer, violated the NLRA by issuing a notice at its Washington state facility warning that union representatives were spending too much time working on union-related email during working hours. The Board found that the notice was “facially discriminatory” because it singled out union representatives and union business. The Board also observed that Weyerhaeuser issued the rule in response to union-related email activity. The Board further held that Weyerhaeuser violated the NLRA by disciplining an employee based on the notice. However, the Board held that the company did not violate the NLRA by maintaining a general policy restricting employees from using electronic media for personal use. Weyerhaeuser Co., 359 NLRB No. 138 (June 20, 2013).
  • The NLRB ruled that Pacific Crane Maintenance Co. and Pacific Marine Maintenance, two companies that repair and maintain marine terminals, acted as a single employer and violated the NLRA by shifting work from a bargaining unit represented by the IAM to a bargaining unit represented by the International Longshore and Warehouse Union (“ILWU”). The Board found that the two companies, who stipulated that they were a single employer, engaged in a series of transactions to decrease labor costs. In particular, Pacific Marine laid off IAM-represented workers to accommodate demands from its shipping client, Maersk Inc. When conducting layoffs, Pacific Marine instructed the workers to apply for work with Pacific Crane. Pacific Crane then hired most of the laid-off workers contingent on the workers becoming employed by an already composed ILWU bargaining unit, which had lower labor costs. The IAM asked to bargain with Pacific Marine about this work transfer, but Pacific Marine agreed only to bargain about the effects of the transfer, and declined to provide information that the IAM requested. In performing these transactions, the Board found that the single employer unlawfully refused to bargain with the IAM, unilaterally changed employment terms for IAM workers, and improperly recognized the ILWU as the bargaining agent for the former IAM workers. The Board ordered the companies to offer to reinstate the workers, recognize the IAM as the workers’ representative, withdraw recognition from the ILWU, and compensate the workers’ benefit funds for any losses. PCMC/Pac. Crane Maint., 359 NLRB No. 136 (June 24, 2013).