A three-judge panel for the U.S. Court of Appeals for the Eleventh Circuit rejected an employer’s argument that because President Obama's 2012 Board recess appointments were unconstitutional, the Board lacked the required quorum to issue a decision against it. The Eleventh Circuit relied on its 2004 ruling in Evans v. Stephens, which, the court noted, concluded that the Constitution's recess appointments clause permits intrasession recess appointments. The Eleventh Circuit’s decision sets the circuit court apart from the D.C., Third, and Fourth Circuit Courts of Appeal, which have deemed the appointments to the board unconstitutional. The recess appointment issue is currently pending before the Supreme Court in the Noel Canning case, and oral arguments are scheduled to take place January 13, 2014. Ambassador Services Inc. v. NLRB.


A three-judge panel for the U.S. Court of Appeals for the Seventh Circuit ruled that Titan Tire Corp. is not obligated to pay the full-time salaries of the president and benefit representative for the union, – the United Steel, Paper and Forestry, Rubber, Manufacturing, Allied Industrial, and Service Workers International Union, – that represents employees at its Illinois tire plant. The court overturned the district court’s decision ordering Titan to resume paying the union president's and benefit representative's full-time salaries, holding that the payments do not fall under an exception to the Labor Management Relations Act’s (LMRA) prohibition on companies paying money to union representatives. The Seventh Circuit held that the payments violated section 302 of the LMRA because they were not vested rights earned by reason of' their former employment at Titan, but rather they were current salaries earned because of their service to the union. Titan Tire Corporation of Freeport Inc. v. United Steel, Paper and Forestry, Rubber, Manufacturing, Allied Industrial and Service Workers International Union et al.


The U.S. Court of the Appeals for the Eighth Circuit vacated an arbitration award and reversed summary judgment for IBT Local 245, finding the arbitrator exceeded his authority when he relied on negotiation history to interpret the meaning of an unambiguous collective bargaining agreement term. The arbitrator had ordered a commercial vehicle suspension supplier in Missouri to provide holiday pay to a worker covered by a bargaining contract who was 45 minutes late to work because of a flat tire on the last workday before a holiday. The court found that the word “may,” in the bargaining agreement, was unambiguous and that it provided the company “with discretion in granting the holiday pay exception.” Further, the court determined the arbitrator looked beyond the text of the agreement and considered testimony regarding contract negotiations to conclude that the company must grant the exception where a worker is late because of “vehicle mechanical trouble, oversleeping, or car wrecks.” The circuit court ruled that the arbitrator “here was ‘not construing an ambiguous contract term, but rather was imposing a new obligation' upon [the employer].” Reyco Granning LLC v. Teamsters Local.


The U.S. Court of the Appeals for the Fifth Circuit held that the NLRB properly found that Carey Salt Co. unlawfully refused to bargain with the USW and illegally failed to return employees to their jobs at the end of an unfair labor practices strike against the company. The court enforced the Board’s order requiring Carey to bargain in good faith, and to make the strikers whole for any loss of pay caused by the failure to recall. However, the court vacated a provision requiring the company to refrain from making “regressive” bargaining proposals during negotiations, finding that the NLRB lacked substantial evidence to support its conclusion that Carey had actually engaged in such conduct. Carey Salt Co. v. NLRB.


An NLRB ALJ ordered that San Francisco’s Richmond District Neighborhood Center did not violate the NLRA when it rescinded rehire offers to two would-be teen activity leaders for a profane Facebook conversation. The ALJ noted that the center, which received both private and public funding, was justifiably worried that the Facebook comments at issue jeopardized the funding of its after-school activities, as well as the safety of the youth. The ruling noted that, although the two employees were engaged in concerted activity when taking issue with how the teen center was run, the actions proposed in the Facebook conversation were not protected under the Act, and that the employees were unfit for further service. Richmond District Neighborhood Center.


An NLRB ALJ held that Kmart Corp. violated the NLRA by maintaining a nationwide employment arbitration program that required employees to waive the right to participate in any class or collective actions, even though the company gave employees a 30-day opportunity to opt-out of the dispute resolution program. Calling the right of employees to engage in concerted activity “central” under the NLRA, the ALJ found securing a permanent waiver of the right was unlawful even if employees voluntarily accepted the employer's terms. Kmart argued that giving employees the time and freedom to make a voluntary choice about alternative dispute resolution distinguished the company's program from the one the NLRB found unlawful D.R. Horton Inc. The ALJ said the Board's reasoning in D.R. Horton remains valid, writing “[t]he key point is that the Board's ‘issue' is with protecting the substantive right under the Act for employees to act collectively – at least in some forum – to vindicate their legal and contractual rights.” Subsequently in early December, the Fifth Circuit reversed the NLRB’s ruling in D.R. Horton, bringing the holding in this case into question. Kmart Corp., a Subsidiary of Sears Holdings Corp.


Meanwhile, another NLRB ALJ ruled that the Board's stance on class waivers “cannot be sustained” in light of a recent U.S. Supreme Court ruling in American Express Co. v. Italian Colors Restaurants, which implicitly rejected the NLRB’s analysis in D.R. Horton. The ALJ noted that the analysis the Supreme Court applied in American Express Co., applies to the Board. The ALJ did, however, find that the employer’s arbitration policy violated the law by including NLRA claims among the claims subject to binding arbitration, as this would prohibit employees from exercising their statutory right to file unfair labor practice charges with the Board.A third NLRB ALJ, Gerald A. Wacknov, rejected similar arguments that the Board's D.R. Horton decision had been overruled by recent Supreme Court decisions. The judge reasoned that because neither case presented issues pertaining to the interrelationship between the NLRA and the Federal Arbitration Act, the Board had not been overruled and he was bound to follow D.R. Horton. In evaluating Securitas Security Services USA Inc.’s arbitration policy under D.R. Horton, the ALJ found that it violated the NLRA, even though one of the two agreements at issue included an opt-out provision. Chesapeake Energy Corp. et al.; Securitas Security Services USA Inc.


Wal-Mart Administrative Decisions

The NLRB’s Office of the General Counsel authorized the issuance of unfair labor practice (ULP) complaints against Wal-Mart Stores Inc., finding merit to some of the allegations brought by OUR Walmart. The ULP charges stem from Wal-Mart's response to the Black Friday strikes at stores across the country in November 2012. The allegations affect 117 employees at Wal-Mart locations in 14 states. The allegations involve statements the company made in two national television news broadcasts, and in communications to employees in in California and Texas, in which the company allegedly threatened employees with reprisal if they engaged in strikes and protests. Additional complaints allege that Wal-Mart “threatened, disciplined and/or terminated employees for having engaged in legally protected strikes and protests” in multiple states.


Also arising out of the 2012 Thanksgiving protests at Wal-Mart, the NLRB's Division of Advice concluded in an advice memorandum that Wal-Mart did not commit an unfair labor practice when it excluded nonemployees from its store properties during labor demonstrations, and that the UFCW did not violate federal labor law during the protests by making alleged “threats” that were too ambiguous to restrain or coerce employees in the exercise of their rights. The Division of Advice concluded that Wal-Mart did not interfere with employee rights under the Act when it enforced a lawful policy on solicitation and distribution and required demonstrators to move from Wal-Mart property to nearby public sidewalks. The Division of Advice also found that Wal-Mart failed to sustain a charge that UFCW violated Section 8(b) (1)(A) of the act during the weeks leading up to demonstrations carried out by OUR Walmart and another UFCW-supported group. Further, the union's offer of $50 gift cards to strikers was not unlawful, and Wal-Mart's evidence that those individuals made scattered threats during the labor dispute did not establish that the union engaged in unfair labor practices. Walmart Stores Inc.; United Food & Commercial Workers.