Facebook "Like" Button - Protected Activity? It Depends on What You "Like"!

In an ever expanding arc of decisions that extends the NLRA’s protections to a wide range of employee conduct – both on-and off-duty, and in union and non-union settings alike – the NLRB last week decided that merely clicking on Facebook’s “Like” Button was concerted, protected activity. Triple Play Sports Bar, 361 NLRB No. 31 (August 22, 2014).

Triple Play Sports Bar is a non-union employer whose owners had a little difficulty preparing annual payroll tax calculations, and as a result, employees owed state income tax in arrears. One of the employees – not happy at the prospect of back taxes – posted on her Facebook “Status Update,”

Maybe someone should do the owners of Triple Play a favor and buy it from them. They can’t even do the tax paperwork correctly‼! Now I OWE money … Wtf‼!

Other employees chimed in with comments of their own (“[the owner] f***** up the paperwork…as per usual”; “[the owner is] such a shady little man. He prolly [sic] pocketed it all from our paychecks…”; “Such an a******”), as did a couple of the Sport’s Bar’s customers. But one employee simply pressed the “Like” button and made no other comments. Company owners terminated the employees for defamation and disloyalty.

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President Obama Signs Executive Order Banning LGBT Job Discrimination by Federal Contractors and Government

What the Executive Order Does:

This Executive Order amends two earlier executive orders: it amends Executive Order 11246, which prohibits discrimination by federal contractors to add sexual orientation and gender identity to the existing prohibitions of race, color, religion, national origin, age and sex discrimination. In addition, Executive Order 11478, which, as amended, bars discrimination against federal employees on the basis of race, color, religion, sex, sexual orientation, national origin, disability and age, is further amended to include gender identity. Notably absent from the Executive Order is an expanded religious exemption requested by some communities of faith, similar to the one included in ENDA. However, President Bush’s Executive Order 13279, which permits religiously affiliated federal contractors to favor individuals of a particular religion when making employment decisions remains in effect.

The new Executive Order states that the provision affecting federal employees will take effect immediately. The provision affecting federal contractors and subcontractors likely will be implemented by early 2015.

What Does This Mean for Employees:

In eighteen states, including California, Minnesota, Oregon and Washington, and in the District of Columbia, laws already exist to protect employees from discrimination based on sexual orientation and gender identity. Additionally, the White House’s Office of the Press Secretary notes that most of America’s major companies have already included LGBT protections within their non-discrimination policies: 91% of Fortune 500 companies prohibit discrimination based on sexual orientation and 61% prohibit discrimination based on gender identity. Among the 50 largest federal contractors, which represent nearly half of all federal contracting dollars, 86% prohibit discrimination based on sexual orientation and 61% prohibit discrimination based on gender identity.

However, there are still 29 states without express job protections based on sexual orientation, and 32 states lack bans on gender identity discrimination. There are an estimated 14 million employees of federal contractors who live in states without state law protections that will now be covered.

What About the Employment Non-Discrimination Act (ENDA):

President Obama has reaffirmed that there remains a need for ENDA. Although ENDA was passed by the Senate in November 2013, ENDA is unlikely to be taken up for a vote in the House anytime soon. In signing the Executive Order, President Obama stated “I’m going to do what I can, with the authority I have, to act. The rest of you, of course, need to keep putting pressure on Congress to pass federal legislation that resolves this problem once and for all.”

Authored by Ed Reeves and law clerk, Dexter Pearce.

College Football Players Are Employees? Who's Next?

The NLRB’s Regional Director in Chicago issued a decision on March 26 in 13-RC-121359 finding the football players at Northwestern University are employees under the NLRA, over the objections of the University. The Regional Director rejected the University’s arguments that the players, who receive “grant-in-aid scholarships” from the University, are more akin to graduate students, held by the Board not to be employees in Brown University, 342 NLRB 483 (2004). The Director also rejected the University’s argument that the players were “temporary employees” who were not eligible for collective bargaining. 

Northwestern’s varsity football team consists of 112 players, 85 of whom receive scholarships that pay for their tuition, fees, room, board, and books in the amount of $61,000 per year ($76,000 per year if they take summer classes). The players receive a “tender” letter at the beginning of their football career that describes the terms and conditions of the offer; are subject to certain rules of conduct; and spend 20-25 hours a week in mandatory activities in the off-season, 40-50 hours per week during the season, and 50-60 hours per week during training camp. The Director found that the players performed “services” for the University that generated revenues of approximately $235 million during the nine-year period of 2003-2012 through the team’s participation in the NCAA Division I and Big Ten Conference through ticket sales, television contracts, merchandise sales, and licensing agreements.

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NLRB Re-Issues Controversial "Quickie" Union Election Rule

On February 5, 2014, the National Labor Relations Board ("NLRB") re-issued its controversial “quickie” election rule.  As you may recall, that rule, which was opposed by employer groups, the U.S. Chamber of Commerce and others, was invalidated by the D.C. District Court in May 2012.  The reissued "quickie" election rule would substantially shorten the time between the filing of a petition and the election to determine whether the union will represent employees--from  approximately 42 days to as little as 10 to 14 days.

The D.C. District court struck down the rule in 2012 for procedural reasons. The Board initially issued the rule in 2011, but its implementation was stayed as a result of a decision of the United States District Court for the District of Columbia, which held that the rule had been improperly adopted with only two Board member votes, rather than statutorily required three Board member votes, under the U.S. Supreme Court's landmark 2010 decision in New Process Steel.  Since July 2013, however, when the U.S. Senate confirmed President Obama's new appointees, the Board has operated with a full five members for the first time since 2007.

How The "Quickie" Election Rule Would Change Union Elections

Under the current approach, unions must gather authorization cards from at least 30 percent of employees in the unit sought to be represented in order to file a petition for an election with the NLRB. Sometimes employers know about the organizing drive before the petition is filed, but sometimes, they do not. During the pendency of the election (which is currently about 40 days), employers have an opportunity to “campaign” against unionization by providing employees with information about the union, its tactics, and the costs and disadvantages of joining a union. Once the employees vote in the election and the union is certified, the employees may not seek to decertify the union for at least a year, or until after the expiration of the first collective bargaining agreement, whichever is longer.

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NLRB Effectively Scraps Plans (For Now) To Pursue Notice Posting Rule By Deciding Not To Seek Review By U.S. Supreme Court

The National Labor Relations Board (NLRB) has suffered a series of setbacks recently at the hands of federal judges.  In December, the Fifth Circuit Court of Appeals largely struck down the NLRB's prohibition on class action waivers in arbitration agreements.  Now, on January 6, 2014, the NLRB announced that it won’t seek Supreme Court review of two U.S. Court of Appeals decisions invalidating its Notice Posting Rule, which would have required most private sector employers to post a notice informing employees of their right to organize. The deadline for seeking Supreme Court review passed January 2.

The legal effect of this “non-event” is that it allows to stand two appellate court decisions that invalidated NLRB's 2011 adoption of a rule.  In May 2013, the U.S. Court of Appeals for the District of Columbia Circuit held in National Ass'n of Manufacturers v. NLRB, 717 F.3d 947 (D.C. Cir. 2013) that requiring employers to post the statement of rights under the National Labor Relations Act (NLRA) would be inconsistent with Section 8(c) of the act, which essentially gives employers the right to speak freely to their employees so long as the communications aren’t coercive. The Court also held that NLRB lacked authority to promulgate the regulation, because it would have effectively modified the federal statutory time limit for filing unfair labor practice charges. A month later, the Fourth Circuit ruled against the NLRB and sustained a second challenge to the regulation in Chamber of Commerce v. NLRB, 721 F.3d 152 (4th Cir. 2013).

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Foiled Again: DR Horton Overturned (But Be Careful How You Phrase Your Arbitration Agreement)

Earlier this week, a three judge panel of the Fifth Circuit Court of Appeals issued its long-awaited decision in DR Horton Inc. v. NLRB. As expected by most labor lawyers, including us, the Fifth Circuit (with one judge dissenting) overruled the National Labor Relations Board’s dramatic extension of the law, that employers could not require employees to enter into agreements to individually arbitrate employment disputes, precluding collective or class action litigation. In DR Horton the NLRB had concluded that such agreements conflicted with employees’ rights to engage in concerted activity under the National Labor Relations Act (the “NLRA”) -- a conclusion that had since been rejected by almost every court to face the issue. The Fifth Circuit’s decision does contain a cautionary note for employers: an arbitration agreement may not appear to bar an employee from filing charges with the NLRB.

DR Horton

DR Horton is a home builder with operations throughout the United States. Beginning in 2006, DR Horton required all its employees to enter into a “Mutual Arbitration Agreement.” The agreement precluded civil litigation between the parties, requiring that all disputes be submitted to arbitration. Most critically, the agreement also barred any form of collective or class action proceeding. In 2008 the underlying plaintiff filed a putative class action lawsuit, contending that he had been misclassified as an exempt managerial employee in violation of the Fair Labor Standards Act. When DR Horton responded by insisting on individual arbitration pursuant to the agreement’s bar of collective actions, the plaintiff filed unfair labor practice charges with the Board.

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Chasm Continues To Widen, For Now, Between NLRB and Federal Courts On Enforceability Of Class Action Waivers In Employment Agreements

Just last week, in the case GameStop Corp., a National Labor Relations Board (NLRB) administrative law judge applied recent Board precedent and ignored contrary cases from federal courts to find an employer’s arbitration agreement was unenforceable because it waived the right of employees to bring class or collective actions.  While the decision has yet to be approved by the NLRB itself (parties can appeal ALJ decisions to the NLRB), it illustrates the continuing tension in this area between the NLRB (which disfavors class action waivers in employee arbitration agreements) and the federal courts (which favor them). 

As we have reported, U.S. federal courts continue to hold that employees may enter into arbitration agreements in which they waive the right to file class or collective action claims.  The U.S. Supreme Court put its stamp of approval on such waivers in 2011 in the blockbuster case AT&T v. Concepcion, holding that the enforceability of arbitration agreements was governed by the Federal Arbitration Act (FAA), which preempted any state law purporting to regulate arbitration agreements, including arbitration agreements with class action waivers.  Building on a decades-long line of cases steadily increasing support for the concept of arbitration and similar alternative dispute resolution (“ADR”) methods for resolving litigation, Concepcion also held decisively that arbitration agreements could include waivers by the parties of the right to bring lawsuits as class actions.  The U.S. Supreme Court has re-affirmed Concepcion in subsequent decisions.

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D.C. Circuit Nixes Board Notice Posting Rule In National Association of Manufacturers v. NLRB

Once again, federal courts have halted efforts by the current National Labor Relations Board ("the Board") to expand its regulatory reach. Earlier this week, in National Association of Manufacturers v. NLRB, the Court of Appeals for the District of Columbia Circuit struck down the Board’s controversial attempt to require virtually all employers to post a notice advising employees about the requirements of the National Labor Relations Act ("the Act") and the sixty years of interpretations of the federal labor laws.

The Board’s notice-posting rule has had a long and contentious history.  The original petition was filed in 1993, but it was not until 2010 when the Board, by then with a majority of members appointed by President Obama, issued a proposed rule.  The final rule was published in August, 2011, and litigation challenging the Board’s authority began almost immediately.  As we have reported before, the Board had only mixed success.  One district court upheld the rule only in part, and another struck down the rule completely.  While those cases were on appeal, the posting requirement was stayed pending completion of judicial review.

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OSHA Issues Interim Final Rules on Whistleblower Protection Provisions Under ACA

The Occupational Safety and Health Administration (OSHA) issued an interim final rule and request for comments regarding procedures for handling employee whistleblower complaints under the Affordable Care Act (ACA), Section 1558. This part of the ACA added a new Section 18c to the Fair Labor Standards Act (FLSA), which protects employees from retaliation for exercising certain rights under the ACA, including (1) receiving a federal tax credit or subsidy to purchase insurance through the employer or a future health insurance exchange, (2) reporting a violation of consumer protection rules under the ACA (which, for instance, prohibit denial of health coverage based on preexisting conditions and lifetime limits on coverage), and (3) assisting or participating in a proceeding under Section 1558.

The interim final rule states the time frames and procedures for bringing a whistleblower complaint under Section 18c and covers the investigation, hearing, and appeals processes. An employee has 180 days from the date of the alleged retaliation to bring a whistleblower complaint to the Secretary of Labor. Where a violation is found, remedies can include reinstatement, compensatory damages, back pay, and reasonable costs and expenses (including attorneys’ fees). If the employee brought the complaint in bad faith, an employer may recover up to $1,000 in reasonable attorneys’ fees.

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D.C. Circuit Invalidates Obama's 2012 "Recess" Appointments to NLRB

The  U.S. Court of Appeals for the District of Columbia today invalidated President Obama's 2012 "recess" appointments of several members of the National Labor Relations Board ("NLRB" or "Board").  Today's decision creates even more uncertainty in federal labor law, an area that has been subject to intense political battles and resulting in tremendous flux over the past few years.

About The Board And Recess Appointments

The Board consists of five Members, each appointed by the President and subject to Senate confirmation.  Historically, the President fills three of the five seats with members from his party, giving his party majority control. 

But since 2007, the appointment process has been broken.  In late 2007, the appointments of three Members expired, and political wrangling left those seats unfilled for 27 months.  The remaining two Members (one from each party) continued the Board’s business.  In 2010, however, the United States Supreme Court ruled in New Process Steel v. NLRB that the Board must have a quorum of 3 to take action, invalidating hundreds of decisions issued by the 2-Member Board.

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Obama NLRB Presents Employers With Several Lumps Of Coal

We continue our recent end-of-year postings (on new California employment laws and things every employer should resolve to do in 2013) with an update on recent cases by the National Labor Relations Board ("NLRB" or "Board").  In late December, 2012, the NLRB issued a series of controversial decisions which from an employer’s perspective cannot be considered Christmas presents.  While some of these cases impact only narrow circumstances, each of the decisions dramatically changes the law, always in ways adverse to employers. 

The Board's December 2012 Decisions

In Alan Ritchey, Inc., the Board created an entirely new obligation for employers operating a workplace where a union has been recognized or certified, but no collective bargaining agreement has yet been agreed to. In this setting, the Board concluded, an employer must notify the union and provide it with an opportunity to bargain over individual discretionary discipline before the discipline is imposed. The Board made clear that this obligation requires sufficient advance notice for meaningful bargaining. Moreover, the employer must respond to union requests for information regarding the discipline before such meaningful bargaining can occur. The Board dismissed concerns that the new obligation it had created would be unduly burdensome for employers, suggesting that there may be circumstances in which an employee could be removed from a job prior to bargaining, when leaving employee on the job might present “a serious imminent danger to the employer’s business or personnel.”

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11th Circuit Disagrees With NLRB And Finds Nurses Are "Supervisors" In Lakeland Health Care Decision

Several weeks ago the U.S. Court of Appeals for the 11th Circuit weighed in on the ongoing debate in labor law over the definition of who is a “supervisor,” and therefore not eligible to join a union, under the federal National Labor Relations Act (“NLRA”). The opinion, Lakeland Health Care Associates , is but the latest installment in an area of labor law that has been evolving over at least the past decade.  While this line of cases, including Lakeland Health Care, are specific to the “supervisor” status of nurses working in the residential care industry, the relevant legal tests are the same for all industries. Employers who may wish to oppose unionization efforts among employees it believes are supervisors will therefore want to continue to pay close attention to these cases to see what could be done to maximize the chance that the National Labor Relations Board (“NLRB” or “Board”) would also find those employees are supervisors. 

LPNs Supervise Other Employees, But Are They “Supervisors” Under The NLRA?

As with many things in labor law, determining who is a “supervisor” is rarely straightforward: simply giving someone the title of “supervisor” is never enough. In many cases employees may have only partial supervisory authority—the issue in cases like Lakeland Health Care is whether the employees had enough supervisory authority to be “supervisors” under the NLRA.

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Recordkeeping: The Often Overlooked Element of FMLA Compliance

Most employers grapple with the better-known aspects of the Family and Medical Leave Act (FMLA), such as determining whether an employee’s illness constitutes a serious medical condition, obtaining required certification or providing adequate coverage for workers on intermittent leave. All too often employers focus on the leave itself and breathe a sigh of relief when notice is provided confirming the dates of leave or when the employee has resumed his or her usual schedule. But an employer’s compliance with federal law includes the obligation to maintain adequate records related to the leave. Failure to do so can have significant consequences.

What Records Must You Keep?

FMLA recordkeeping requirements can be found in a single regulation, 29 C.F.R. § 825.500. That regulation requires employers to keep and preserve records in accordance with the recordkeeping requirements of the Fair Labor Standards Act (FLSA).  Records must be retained for no less than three years. Although no particular order or form is required, the records must be capable of being reviewed or copied. 

Covered employers with eligible employees must also maintain records that include basic payroll and data identifying the employee’s compensation. Failure to maintain accurate records can have significant consequences for employers, who have the burden of establishing eligibility for leave. Accuracy is important:  for example, the regulations demand that records document hours of leave taken in cases of leave in increments less than a full day.  Lack of suitable records documenting when leave was taken can also doom an employer’s defense to claims for leave. Special rules apply to joint employment and to employees who are not covered by or are exempt from the FLSA.

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Where There Is At-Will, There Is A Way: NLRB Issues New Guidance On "At Will" Employment Policies

On Halloween, the National Labor Relations Board (“Board”) General Counsel’s Division of Advice handed out a rare treat to employers by issuing two Advice Memos (Mimi's Café, Case No. 28-CA-0844365 and Rocha Transportation, Case No. 32-CA-086799), deeming two particular (and common forms of) at-will employment policies contained in employee handbooks lawful under the National Labor Relations Act (the “Act").  

Earlier this year, an Administrative Law Judge frightened many employers by ruling a particular company’s “at-will” policy violated the Act because it theoretically could make employees believe that they could not form a union or otherwise advocate to change their at-will employment status. That challenged policy stated, “I further agree that the at-will employment relationship cannot be amended, modified or altered in any way.” The case, American Red Cross Arizona Blood Services Division, Case No. 28-CA-23443 (February 1, 2012), was settled before the NLRB could review it on appeal. 

The Division of Advice’s Halloween memoranda distinguished American Red Cross case from Mimi's Café and Rocha Transportation – noting that the at-will policy in American Red Cross used the personal pronoun “I” (“I further agree that the at-will employment relationship cannot be amended, modified or altered in any way”), which as written essentially constituted an impermissible waiver of any right of employees to try and change at-will status (i.e., to try to form a union).  The Division of Advice also noted that the policy in American Red Cross declared that the at-will employment relationship could never be modified under any circumstances whatsoever, which could be interpreted as chilling employees’ rights under the Act to engage in protected concerted activity such as forming a union.   Finally, the Division of Advice, perhaps dismissively, noted that American Red Cross had settled before getting to the Board level.

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NLRB Puts Kibosh On Some Employer Social Media Policies

The National Labor Relations Board (“NLRB”) continues to closely scrutinize employers’ social media policies and practices. As employers struggle to craft policies that promote productivity while at the same time protect employees’ rights, both unionized and non-unionized employers need to be aware of recent NLRB decisions and their impact on employer policies:

Social-Media Based Termination Can Be Acceptable, But Rule Requiring “Courtesy” Is Not

On September 28, 2012, a three-member panel of the NLRB affirmed the termination of a car salesman who posted photographs on Facebook ridiculing his employer, but it rejected the employer’s rule requiring courteous behavior. (Karl Knauz Motors Inc., 358 N.L.R.B. No. 164, Sept. 28, 2012 [released Oct. 1, 2012]). Knauz marked the first time a panel of the NLRB decided a case involving social media; previously, all NLRB guidance in this area came from ALJ decisions or the Board’s General Counsel Memoranda. In Knauz, a sales employee had complained on his Facebook page about his employer, a BMW car dealership, posting photos and criticizing bad food the dealer offered at a sales event; he had also discussed those concerns with other coworkers. He also posted critical comments and photos about an accident during a test drive at the dealership. The employer terminated the employee for his Facebook postings and for violating the employer’s courtesy policy. That policy stated that “[e]veryone is expected to be courteous, polite and friendly to our customers, vendors and suppliers, as well as to their fellow employees,” and that “[n]o one should be disrespectful or use profanity or any other language which injures the image or reputation of the Dealership.”

The NLRB ultimately declined to decide whether the employee’s complaints about the food were protected activity under the NLRA. The ALJ below had held the food complaints were protected because the employee and his coworkers conceivably were concerned that the low-quality food offered at the sales event would deter customers from coming, thus leading to lower sales commissions for the employees. Instead, the NLRB upheld the employee’s termination, agreeing with the ALJ that the employee’s Facebook postings relating to the on-site accident were not related to any employees’ terms or conditions of employment. 

 

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NLRB's Court Woes Continue: New Election Rules Struck Down

The Obama NLRB’s regulatory agenda continues to fare poorly in the federal courts.  On the heels of court decisions staying the NLRB’s new “notice” requirement, see previous posts here, the United States District Court for the District of Columbia Circuit has just struck down the NLRB’s new rules designed to speed up union representation elections.

Employers and their representatives have been concerned about the Board’s new election rules since they were issued in September.  See our previous posting here.  Employers’ concerns were heightened when the Board’s Acting General Counsel issued a “Guidance Memorandum” directing the Board’s Regional Offices on how to implement the new rules.  That Guidance Memorandum is available here.  That Guidance Memorandum articulated several “best practices” that would further accelerate the election process.

 

In response to the new rules, the US Chamber of Commerce and other groups sued the Board, citing a number of substantive and procedural objections to the new rules.  Judge James Boasberg (an Obama appointee) struck down the Board’s decision solely on procedural reasons: the absence of a quorum.  Just two years ago, the United States Supreme Court had emphasized the importance of the Board having a minimum of three members to act.  The court had emphasized in New Process Steel that the quorum requirement is not, under the Taft-Hartley Act, a mere “technical obstacle.”  Ironically, concern about the then-impending loss of a quorum in December, 2011, caused the Board to rush its normal internal processes.  Member Hayes had previously expressed his opposition to the proposed rules.  When the final proposed rules were circulated among the three Board members, member Hayes did not participate – but the two member majority adopted the rules anyway.  The District Court concluded that the Board thus acted without a quorum:

 

“According to Woody Allen, 80% of life is just showing up.  When it comes to satisfying a quorum requirement, though, showing up is even more important than that.”

 

In the absence of a lawful quorum, the rules were not properly adopted, and therefore must be struck down.  The judge expressly did not reach any of the substantive objections to the rules.

 

This will likely raise substantial uncertainty in the near term.  The Board could attempt to readopt the rules with its current membership – but doing so would only be more controversial: any quorum relying on the President’s “recess” appointments to the Board (made at a time when the Senate was not in recess!) will be subject to further attack.  It is also not clear what course Regional Offices will take as to elections that were being handled under the now-stricken rules or what effect will be given to the Acting General Counsel’s “Guidance Memorandum.”

 

Employers should stay tuned for further developments – and if you receive a union election petition you should call your Stoel Rives labor lawyer immediately!

UPDATE: NLRB Postpones Posting Rule Indefinitely

In response to two federal court cases we previously blogged about here and here, the NLRB has indefinitely postponed implementation of its notice posting rule pending appeals in both of those cases.  The bottom line is that no employer needs to post the notice for the time being.

The U.S. Court of Appeals for the D.C. Circuit will hear the NLRB’s appeal of an emergency injunction that court issued against the rule, but the hearing will not occur before September 2012.  In the trial court ruling in that case, the judge found the NLRB's posting rule valid, but its enforcement provisions invalid.  The NLRB is also appealing the South Carolina federal trial court decision we previously blogged about, in which a judge deemed the NLRB's entire posting rule invalid.  No schedule has yet been set for the South Carolina appeal.

See the NLRB’s statement about this issue here.

California Supreme Court Clarifies Meal and Rest Break Requirements Under State Law

In its long-anticipated decision in Brinker v. Superior Court, a unanimous California Supreme Court has clarified the scope of an employer’s obligation to provide meal and rest breaks to non-exempt employees in California.  The Court's full opinion is available here.

Meal Breaks

California law requires employers to provide employees with a meal period of not less than 30 minutes for workdays lasting more than five hours, and to provide two meal periods for workdays in excess of ten hours, subject to waiver in certain circumstances.  At issue in Brinker was whether an employer must ensure that an employee’s work stops for the required 30 minutes, or whether an employer is only obligated to make meal periods available, with no responsibility for whether they are taken.  The Court concluded that an employer’s obligation is to relieve its employee of all duty, with the employee thereafter at liberty to use the meal period for whatever purpose he or she desires.  The employer must relinquish control over its employee’s activities and give the employee a reasonable opportunity to take an uninterrupted 30 minute break, and the employer may not impede or discourage the employee from doing so.  However, the employer is not obligated to police meal breaks and ensure no work is performed. 

Timing of Meal Breaks

The Court held that an employer must provide a first meal period no later than the end of an employee’s fifth hour of work, and a second meal period no later than the end of an employee’s tenth hour of work.  The Court found that there are no additional timing requirements, such as rolling five hour meal periods. 

Rest Periods

Under California law, employers must authorize and permit employees to take rest periods based on the total hours worked daily, at the rate of ten minutes net rest time per four hours worked or major fraction thereof.  A rest period need not be authorized for employees whose total daily work time is less than three and one-half hours.  The Court summarized the rest period obligation as follows: employees are entitled to ten minutes’ rest for shifts from three and one-half hours to six hours in length, 20 minutes for shifts of more than six hours up to ten hours, 30 minutes for shifts of more than ten hours up to 14 hours, and so on.  The 10-minute breaks must fall within the middle of a four hour period of work, to the extent practicable.

Timing of Rest Periods

The Court held that employers do not have a duty to permit their employees a rest period before any meal period.

What Brinker Means For Employers

Brinker is generally regarded as a favorable ruling for employers, and the decision provides a roadmap for employers to reduce the risk of claims arising from alleged meal and rest period violations.  Post-Brinker, it is essential that California employers carefully review and, if necessary, revise policies to state that meal periods are duty-free, 30 minutes in length and are to be taken before the end of the fifth hour of work.  Rest period policies should now detail that rest periods are authorized and permitted in accordance with the specific standards set forth above.

Employers should continue to require employees to clock out and in for meal breaks, and to carefully monitor and manage whether employees are working through their meal periods.  Employers are liable for straight time or overtime pay if they know or should have known employees have worked through meal breaks. If an employee is not clocking out for meals, an employer would likely be found to be on notice that the employee continued to work and thus should be paid for that time.  Additionally, if there is a pattern of employees not taking meal periods, or taking meal periods of less than 30 minutes in length or after the end of the fifth hour of work, management should look into whether the employees are really being given the opportunity to take timely 30-minute off-duty meal periods.

Finally, supervisors and managers should be trained on the importance of allowing employees to take meal and rest periods as prescribed in Brinker.  While the outcome in Brinker is good news for employers, managers who discourage or prevent employees from taking meal or rest breaks will expose the company to substantial liability.

UPDATE: DC Court of Appeals Delays Implementation of NLRB Posting Requirement

The NLRB’s new posting rule, which would apply to virtually all private sector employers, was scheduled to go in effect on April 30, 2012.  Yesterday, we blogged about a South Carolina federal trial court decision striking down the posting rule.  More good news for employers arrived today, as the United States Court of Appeals for the District of Columbia issued an emergency injunction preserving the “status quo” and delaying implementation of the NLRB’s posting rule until that Court of Appeals determines its validity.  The D.C. trial court had previously determined the posting rule was valid (contrary to the South Carolina case) but that its remedies were invalid.  Oral argument in the D.C. appellate case is currently estimated to occur in September 2012.  A copy of the D.C. Court of Appeals injunction decision is here.

 

We now have two courts that have stymied the NLRB posting rule.  It is still unknown whether the NLRB will appeal the South Carolina and D.C. Court of Appeals decisions.  But for now, absent an emergency appeal, it appears that the NLRB’s posting rule will, at a minimum, be delayed for several months.  We will keep you “posted” as developments occur.

South Carolina Federal Court Holds NLRB's Notice Posting is Unlawful

As previously blogged here, a federal court located in the District of Columbia upheld the National Labor Relations Board's (“NLRB”) rule requiring nearly all private sector employers, whether unionized or not, to post a notice to their employees about certain employee rights under the National Labor Relations Act.  While upholding the rule, that federal court did at least strike down the rule’s main enforcement provisions.  A copy of that federal court decision is here.  As we blogged then, another legal challenge to the NLRB’s rule was also pending in a South Carolina federal court.  That decision is now here, and it is a good one for employers.

The U.S. Chamber of Commerce and the South Carolina Chamber of Commerce challenged the NLRB’s rule.  On April 13, 2012 (perhaps Friday the 13th from the NLRB’s perspective), the federal judge in that South Carolina case ruled that the NLRB’s entire posting rule is invalid, finding the NLRB exceeded its authority when it required employers to post notices explaining workers’ rights to form a union. In his ruling, the South Carolina federal judge said the NLRB lacked the legal authority to issue the notice and thus the rule was not lawful.  “Based on the statutory scheme, legislative history, history of evolving congressional regulation in the area, and a consideration of other federal labor statutes, the court finds that Congress did not intend to impose a notice-posting obligation on employers, nor did it explicitly or implicitly delegate authority to the Board to regulate employers in this manner,” the court ruled.

Many labor law professionals feel that the NLRB has become overly aggressive in supporting and expanding union rights during the Obama administration.  This sentiment is especially strong in a conservative state like South Carolina, which also was at the center of a now-settled dispute between the NLRB and Boeing over Boeing’s decision to move production of its 787 Dreamliner airplane from Washington State to South Carolina.  The South Carolina federal judge appears to agree that the NLRB is becoming overly aggressive, stating, “The Board also went seventy-five years without promulgating a notice-posting rule, but it has now decided to flex its newly-discovered rulemaking muscles.”  A copy of the South Carolina decision is here. Its authority is technically legally limited to that particular court, but because of its import we expect it to have an effect nationally as the NLRB seeks to regroup and rethink what it will do.  If the NLRB does not appeal the South Carolina court’s decision, the ruling will stand and, from a practical perspective the posting requirement will be invalidated nationally.  But most pundits anticipate that the NLRB will file an appeal over the South Carolina decision.

The bottom line is that we now have two conflicting federal court rulings on the issue, and await the NLRB’s decision on whether it will appeal the South Carolina ruling, and/or delay implementation of its previously stated April 30, 2012 posting deadline.  Stay tuned.

When Does Alcohol or a Controlled Substance Preclude Workers' Compensation Benefits?

Like most states, Utah’s Worker’s Compensation statute prohibits an employee from recovering disability compensation when “the major contributing cause of the employee’s injury” is the employee’s unauthorized use of alcohol or a controlled substance. See Utah Code Ann. § 34A-2-302(3)(b). If any amount of a controlled substance or its metabolites is found in an injured employee’s system at the time of the injury, the Worker’s Compensation statute presumes that drug use was the major contributing cause of the injury. 

An employee can rebut this presumption by:

  • challenging the accuracy of the drug test;
  • demonstrating that he or she did not actually use a controlled substance;
  • providing expert medical opinion suggesting that the level of controlled substance in the employee’s system does not support a finding that drug use was the major contributing cause of the injury; or
  • otherwise demonstrating that drug use was not the major contributing cause of the injury.

 

A Utah appellate court recently weighed in on this issue when it reversed the Utah Labor Commission’s denial of disability compensation to James Barron in Barron v. Labor Commission.

Mr. Barron was severely injured while at work when he stepped backward off the edge of temporary metal decking at a construction site and fell fourteen feet to a concrete floor below. A urine sample taken at the hospital on the day of the accident tested positive for cocaine metabolites. Mr. Barron admitted to sharing a quarter of a gram of cocaine with a friend two days before the accident but presented evidence tending to demonstrate he was not impaired at the time of the accident, including testimony from co-workers and medical personnel who observed Mr. Baron’s conduct on the day of the accident.

Applying the statutory presumption, the Commission ignored Mr. Barron’s evidence of non-impairment and found that drug use was the major contributing cause of his injury. Specifically, the Commission determined that Mr. Baron must demonstrate that “some other force” apart from his own actions caused his injury to overcome the presumption. Following case law from a number of other states with similar statutory schemes, the Utah Court of Appeals reversed the decision of the Commission and, for the first time, clarified that employees are not required to show that their injury was the result of an outside force to overcome the statutory presumption. Rather, evidence of non-impairment at the time of the accident may be used to rebut the presumption and to demonstrate that drug use was not the major contributing cause of injury. 

So, when does the use of alcohol or a controlled substance preclude workers' compensation benefits?  The answer: almost always, but not when employees can demonstrate that they are not impaired, despite the presence of controlled substances within their systems.

NLRB Posting Requirements - Update

Update: A federal trial court in the District of Columbia has upheld the notice posting requirement in the National Labor Relations Board's (“NLRB”) recently issued final rule requiring nearly all private sector employers, whether unionized or not, to post a notice to their employees about certain employee rights under the National Labor Relations Act. To view the Court's decision, click here.  The court also held, however, that the rule’s main enforcement provisions, including making an employer’s failure to post a per se unfair labor practice, are invalid. Unless this decision is overturned or another court finds the rule to be invalid, the notice posting requirement will still take effect April 30, 2012. An appeal is likely in the District of Columbia case, and at least one other court challenge is pending in South Carolina.


For additional information regarding the NLRB's rule and posting requirement, including links to the rule and the poster employers must post, see our prior discussion on this topic by following this
link.

Are Remedies Available to Working Moms Who Experience "Lactation Discrimination"?

For many new moms returning to work after the birth of a child, pumping breast-milk is considered to be a necessary evil.  Necessary because pumping ensures that these mothers’ babies can continue to experience the many benefits of breast-milk, and helps the mothers to maintain their milk supplies, relieves painful engorgement, and prevents potentially serious medical conditions like mastitis.  Evil because, well, it is not exactly fun to do, especially if the workplace is not supportive.  The U.S. Centers for Disease Control reports that full-time work for new mothers is “significantly associated with lower rates of breastfeeding initiation and shorter duration,” due primarily to workplace barriers such as “a lack of flexibility for milk expression in the work schedule, lack of accommodations to pump or store breast-milk, concerns about support from employers and colleagues, and real or perceived low milk supply.”  Click here to view CDC's report.

One mother recently faced with this predicament is Donnicia Venters, who alleged in a federal lawsuit that her employer fired her while she was on maternity leave when she inquired about using a back room in the office to pump milk upon her return from leave.  The EEOC brought suit on Ms. Venters’ behalf in the United States District Court for the Southern District of Texas, asserting sex discrimination claims against the employer under Title VII.  See EEOC v. Houston Funding II, Ltd., Case No. 4:11-cv-02442 (S.D. Tex.).  Title VII makes it “an unlawful employment practice for an employer . . . to discharge any individual . . . because of such individual’s . . . sex.” 42 U.S.C. § 2000e-2(a)(1).  The Pregnancy Discrimination Act amended Title VII to state that “‘because of sex’ … include[s] … because of … pregnancy, childbirth, or related medical conditions ….” 42 U.S.C. §2000e(k).

United States District Judge Lynn N. Hughes (who is a male, for the record) recently granted summary judgment in favor of the employer, ruling that “[f]iring someone because of lactation or breast-pumping is not sex discrimination.”  In a rather conclusory fashion, the court reasoned that “lactation is not pregnancy, childbirth, or a related medical condition” and that any “pregnancy-related conditions” experienced by Ms. Venters ended on the day she gave birth to her daughter.  To see the full opinion click here.

In the few short days since it has been issued, this ruling has garnered much critical attention.  As many commentators have pointed out—and this seems quite obvious—only women can lactate, and lactation does not usually happen in the absence of childbirth.  The ruling therefore strikes many as illogical—how can firing someone for lactation or breast-pumping not be because of sex or a childbirth-related medical condition?  The EEOC has stated that it is considering whether to appeal the ruling.  The issue therefore remains far from settled. It remains to be seen whether the appellate court, or other judges who might be faced with this issue, will come to a different conclusion than Judge Hughes did.

Pumping mothers also have a new legal protection that Ms. Venters did not have when she gave birth to her baby in 2008.  Effective March 23, 2010, the Patient Protection and Affordable Care Act (also known as the Healthcare Reform Act) amended the Fair Labor Standards Act (FLSA) to require employers to provide a nursing mother break time to pump.  Specifically, covered employers must provide reasonable break time for an employee to express breast-milk for her nursing child for one year after the child’s birth, each time the employee has need to express milk.  See 29 U.S.C. § 207(r).  Employers must also provide a place, other than a bathroom, that is shielded from view and free from intrusion from coworkers and the public, which may be used by an employee to express breast-milk.  Id.

There are, of course, several limitations to this protection.  The FLSA amendment does not require employers to pay employees for such break time.  Id.  The requirements also do not apply to employers with less than 50 employees, if such requirements would impose an undue hardship by causing the employer significant difficulty or expense when considered in relation to the size, financial resources, nature, or structure of the employer’s business.  Id.

Under this amendment, nursing mothers who experience “lactation discrimination” in the workplace might now have a remedy—albeit a limited one—under the FLSA.  The FLSA makes it illegal for an employer to “discharge or in any other manner discriminate against any employee because such employee has filed any complaint or instituted or caused to be instituted any proceeding under or related to [the FLSA].”  29 U.S.C. § 215.  In most jurisdictions, this provision applies to any employee who complains about an FLSA violation, either formally to an administrative agency, or informally to the employer.  A nursing mother who complains about her employer’s failure to provide reasonable break time for her to pump would therefore be protected by this anti-retaliation provision in the FLSA.  As the language of this anti-retaliation provision makes clear, however, the employee must actually complain to the employer in order to be protected.  Thus, if Judge Hughes’ opinion turns out to be the prevailing view and lactation is not protected under the Pregnancy Discrimination Act or Title VII, there is still a gap in protection, even with the FLSA amendment.  Nursing mothers who are simply fired for pumping at work before ever complaining about an employer’s FLSA violation would have no remedy.  In this scenario, a legislative amendment to Title VII, or legislation at the state level, might be the only potential source of protection.

In fact, many states have attempted to fill the gaps in protection for nursing mothers by passing their own legislation. A complete list of state laws enacted to protect breastfeeding can be found hereOf the states where Stoel Rives has offices, California, Oregon, and Minnesota each have laws that require employers to provide breaks for women to breastfeed or pump. To the extent these state laws are more robust than the FLSA amendment, they are not preempted.  see 29 U.S.C. § 207(r)(4).

Guidance on Terminations in Alaska

 

Two recent opinions from the Alaska Supreme Court offer helpful guidance to employers regarding termination processes.

 

In Barickman v. State, an employer suspected an employee of theft.  When confronted, the employee signed a letter of termination and then wrote a letter stating that he was resigning to avoid a “black mark on his record.”  The employee later sued, alleging wrongful termination based on breach of good faith and fair dealing.

 

To win a claim of wrongful discharge in Alaska, the employee must show that (1) he was discharged by his employer and (2) that the employer breached a contract or committed a tort in connection with the termination.  Here, the employee argued that his employer terminated him in bad faith, treated him differently than similarly situated employees, and failed to conduct a reasonable investigation before deciding to fire him.

 

Alaska law provides that when an employer makes a good faith determination that misconduct has occurred, there is no breach of the implied covenant of good faith and fair dealing, even if the employee can subsequently prove that the factual finding of misconduct was a mistake.  Here, the Supreme Court found that the employee did not raise any facts alleging that the employer’s determination was made in bad faith, particularly since the employer provided a spreadsheet showing instances where other employees accused of similar charges were dismissed or asked to resign.  The Court ultimately held that the employer did not breach its duty of good faith and fair dealing.  The Court likewise found that the employee failed to present enough evidence on the issues of whether the employer had treated him differently than other similarly situated employees or whether the employer’s investigation was unreasonable.

 

Boyko v. Anchorage School District  involved a teacher who sued the Anchorage School District, one of Alaska’s largest employers.  The parties had entered into a verbal resignation agreement wherein the employer promised not to release any negative information about the teacher to prospective employers.  The teacher claimed that the District had provided information that was not positive to another school district, and that these actions breached the termination agreement, violated the covenant of good faith and fair dealing, and interfered with her prospective contractual relations.  She also claimed disability discrimination, because the termination stemmed from incidents associated with the teacher’s drinking problem.  The employer won on summary judgment all counts in the lower court, where the court found that the employer was immune under an Alaska statute (see AS 09.65.160) immunizing employers who disclose job performance information in good faith.

 

The Supreme Court largely disagreed, finding that evidence the teacher produced in the trial court raised sufficient factual issues as to whether the District had breached the resignation agreement, and therefore whether the District had violated the covenant of good faith and fair dealing and interfered with the teacher’s  prospective contractual relations.  The Court also noted that statutorily-created rights can be waived where there is “direct, unequivocal conduct indicating a purpose to abandon or waive the legal right.”  Ultimately, the Court found that whether such a waiver occurred through the District’s verbal negotiation of a resignation agreement was in itself a material issue of fact, and remanded the claim to the lower court.

 

It was not all bad for the employer.  On the disability claim the court found that District had provided a legitimate, nondiscriminatory reason for the dismissal and that the teacher had not raised sufficient doubts as to whether the reason was a pretext.  Therefore, the Court affirmed the lower court’s entry of summary judgment on the claim.

 

Four Practical Tips For Terminations:

  1. Always act in good faith and deal fairly with employees.
  2. Consider whether termination of employment is consistent with applicable policies and past practices.
  3. Good documentation demonstrates process (and calm reflection).
  4. Be careful what you say at termination – it can become an oral contract.

Melanie Osborne contributed to this post.

NLRB Finds Employee Arbitration Agreement Waiving Class Claims Violates Federal Labor Law

In DR Horton, a decision issued on January 3 and applicable to most private sector employers, whether unionized or not, the National Labor Relations Board (NLRB) held that federal labor law prevents employers from requiring their employees, as a condition of employment, to agree to broad waivers that would deny their right to pursue employment-related class actions both in court and in arbitration, leaving them no forum for pursuing class or collective claims.  As a result, an important tool for managing the risk of employment-related litigation has been taken away (for now). 

The facts of the case are straightforward.  DR Horton, like many employers, required its employees to sign an arbitration agreement as a condition of employment.  The agreement required employees to arbitrate all claims arising out of their employment, and precluded arbitrators from issuing class or group relief.  As a result, employees were prevented from bringing class or collective actions in any forum.  Relying on this agreement, DR Horton refused to arbitrate a class action alleging that it had misclassified certain employees as exempt from the protections of the Fair Labor Standards Act (FLSA).

 

Not so fast, according to the NLRB.  Tracing federal labor law back to its origins, the NLRB found that the filing of a class action “to redress workplace wrongs or improve working conditions” is activity at “the core” of what Congress intended to protect when it enacted the National Labor Relations Act in 1935.  This intent, the NLRB reasoned, is reflected in Section 7 of the Act, which gives employees the right to engage in “concerted activities” for the purposes of “mutual aid or protection.”  Relying on Section 7, the NLRB found that Employers cannot compel their employees, as a condition of employment, to entirely waive the right to bring class or collective actions.

 

The NLRB’s ruling in DR Horton clashes with the U.S. Supreme Court’s recent decision in AT&T Mobility v. Concepcion, which held that arbitration clauses that waive the right to bring class claims entirely (in the commercial contract context) may be lawful and enforceable.  But unless and until the courts intervene to resolve this tension, requiring your employees to completely waive the right to bring employment-related class or collective actions - a common feature of arbitration agreements - is probably no longer permissible under federal labor law.

 

If You're Interested In Learning More, Sign Up For Our Webinar

Stoel Rives is hosting a webinar on January 11, 2012, to address employee arbitration agreements generally and the DR Horton decision in particular.  Click here if you're interested in learning more or attending.

NLRB's New "Vote Now, Litigate Later" Union Election Rules To Become Effective April 2012

 The NLRB gave organized labor a meaningful gift just before the holidays by issuing a final rule adopting new election case procedures that will likely result in more and faster union elections, and probably also result in more employers having unionized workforces.  The new rule becomes effective on April 30, 2012.

The New Year:  Out With The Old Rules...

During union campaigns, the union and the employer may disagree (vigorously) about the proper size ("scope") of the proposed bargaining unit.  Such disputes can include whether certain employees are "supervisory" employees and thus ineligible to vote, or whether different classifications of employees share enough of a "community of interest" to be included in the same bargaining unit, and covered by the same contract.  How those disputes are resolved often determine the outcome of the election.  Under the existing (er, now old) election rules, employers had the opportunity to litigate these types of bargaining unit scope issues before the election. 

...In With The New

The NLRB's new rule essentially eliminates the employer's opportunity to litigate, prior to the election, any disputes over the scope of the bargaining unit proposed by the union.  Under the rule, such issues will ordinarily be addressed only after the election takes place.  Employers should be aware of how this "vote now, litigate later" rule could impact union elections. 

Shorter Election Campaigns: Under the old rules, litigating bargaining unit scope issues usually delayed the election, giving employers additional time to discuss the pros and cons of unions with its workers before the vote.  That additional campaign period is now lost, depriving employers of valuable time to counter an organizing campaign that may have started months before the union went to the NLRB seeking an election. 

Greater Difficulty in Challenging The Union's Proposed Unit: Although employers may technically be able to litigate unit scope and voter eligibility issues after the NLRB conducts the election, in those cases where the vote results in a "yes" vote for the union (which under the old rules happened more than 60% of the time), employers will be in the difficult position of having to contest threshold legal issues after the employees have already "won" the right to representation.  This procedure tilts the playing field in favor of unions. 

Considered in the context of the NLRB's August 2011 decision in Specialty Healthcare, this rule means that the petitioning union will get a quick election in the unit of employees it has chosen to organize.  Specialty Healthcare enables unions to organize small or "micro" units of employees (such as single classifications of employees or individual departments).  The Board held that for an employer to add excluded employees to the union's proposed unit, it must demonstrate that the excluded employees share an "overwhelming community of interest" with the employees the union seeks to represent.  In a dissenting opinion, NLRB Member Brian Hayes noted that this test makes it “virtually impossible” for the employer to prove the union's proposed unit is not proper.  To make matters worse, now the Employer will ordinarily have to make that argument after the union has already "won." 

Why Now?  Election Year Politics, That's Why.

That the NLRB issued these new rules now probably had less to do with the holiday spirit than with an election of a different sort--the 2012 U.S. Presidential election and the related gridlock in the U.S. Congress.  Up until last week, the Board had three members (out of a possible five) which, after the U.S. Supreme Court's 2010 decision in New Process Steel, is the minimum required for the NLRB to decide cases and issue regulations.  Last week was when President Obama's controversial recess appointment of Member Craig Becker ended.  The NLRB may have wanted to enact the new rules before it was reduced to two members again, as that may be the last opportunity in an election year for the Obama Administration to do something substantial for organized labor, an important constituency.  While nominations for the three NLRB Member vacancies are pending, the gridlocked Senate is not expected to act on those nominations any time soon.  While the President could make another recess appointment to ensure a functioning, three-member NLRB, that risks (further) alienating Senate Republicans, all 47 of whom recently signed a letter urging the President not to fill NLRB vacancies using recess appointments.  The next few weeks, before Congress reconvenes on January 23 from its holiday recess, could be very interesting for NLRB-watchers.  Stay tuned...

Update!

 

...well you didn't have to stay tuned for long!  President Obama has announced three recess appointments to the NLRB.  The appointees include two Democrats (Richard Griffin and Sharon Block) and one Republican (Terence Flynn), giving Democrats a 3-2 Board majority.  The President’s decision to bypass the Senate confirmation process quickly drew the ire of Senate Republicans, but the President chose that fight over the alternative of allowing the NLRB to go through a prolonged period in which it was unable to issue decisions or adopt regulations.  As a result of these appointments, we can expect more pro-labor decisions in 2012.

 

Update - New Rule Requires Employers to Post Notice of Employee NLRA Rights

In order to allow more time for legal challenges to its notice-posting rule to be resolved, the National Labor Relations Board has again postponed the rule's effective date, this time to April 30, 2012.  Stay tuned.

For additional information regarding the NLRB's new rule and posting requirement, including links to the new rule and the poster employers must post, see our prior post on this topic by following this link.

Seasons' Greetings From The California Legislature--New Laws That Apply To Employers In January 2012

The California legislature has done plenty this year to leave in employers' stockings for the holidays--new employment laws that will become effective January 1, 2012.  In addition to the new California Transparency in Supply Chains Act we blogged about earlier, after some eggnog and holiday cheer, employers will need to be aware of new legal obligations that will kick in as we kick off 2012.  Here are the highlights.

 “Anti-Wage Theft” Law (AB 469). The Wage Theft Prevention Act of 2011 requires employers to provide non-exempt employees, at the time of hiring, a notice specifying the employee’s rate or rates of pay and the basis on which the employee’s wages are to be calculated (such as hourly, daily, piece, salary, commission, etc.). The notice must also include applicable overtime rates, allowances (if any) claimed as part of the minimum wage, the employer’s designated regular payday, the name of the employer (including any “doing business as” names), the employer’s physical and mailing addresses, and contact information for the employer’s workers’ compensation carrier. The Act also requires the employer to notify employees in writing of any changes made to any of this information within seven days of the implementation of such changes, unless the changes are reflected on a timely wage statement or other writing required by law. The Act adds an element of criminal liability by providing that any employer who willfully fails to pay wage-related Labor Commissioner orders or court judgments is guilty of a misdemeanor. 

Independent Contractors (SB 459). This new law cracks down on employers who misclassify their employees as independent contractors by imposing a fine of between $5,000 and $25,000 for “willfully” misclassifying a worker as an independent contractor. “Willful misclassification” means avoiding employee status for an individual by voluntarily and knowingly misclassifying that individual as an independent contractor. The law also imposes joint and several liability for a non-attorney consultant to advise an employer to willfully misclassify someone as an independent contractor.

Background Checks (AB 22). This law prohibits most employers from obtaining or relying on consumer credit reports regarding employees or job applicants, except in certain specified limited circumstances. The law does not apply to financial institutions or entities required by law to perform credit checks. Under the new law, employers may still obtain and rely upon credit reports for managerial employees covered by the executive exemption.

Pregnancy Disability Leave (AB 592 and SB 299). This law expressly prohibits “interference” with the exercise of any right provided under the California Family Rights Act, or due to disability by pregnancy, childbirth or related medical conditions. In a provision that may prove to be preempted by ERISA, the law also requires employers to maintain and pay for health coverage under a group health plan for any eligible female employee who takes up to four months of leave due to pregnancy, childbirth or a related medical condition in a twelve month period. 

Gender Identity and Expression (AB 887). Existing law prohibits discrimination and harassment based on gender. This law expands the definition of “gender” to include both gender identity (how the person sees him or herself) and gender expression (how other people view the person). Under the new law, an employee must be permitted to dress consistent with the employee’s gender identity and expression.

Genetic Information Discrimination (SB 559). Discrimination in hiring or employment based on genetic information is now unlawful under the Fair Employment and Housing Act. Genetic information is defined to include the individual employee’s genetic tests, the genetic tests of the employee’s family members, and the manifestation of a disease or disorder in the employee’s family members. 

Commission Agreements (AB 1396). This law requires all contracts for employment involving commissions as a method of payment to be in writing and to set forth a method by which the commissions are required to be computed and paid. The employee must be given a signed copy, and the employer must obtain a signed receipt from each employee. This law does not take effect until January 1, 2013, so employers have a year to prepare for compliance.

Agricultural Labor Relations (SB 126). This law authorizes the California Agricultural Labor Relations Board to certify union elections when employer misconduct affects the outcomes.

 Happy Holidays!

Mandatory Paid Sick Leave Law Passed in Seattle

Beginning September 1, 2012, the City of Seattle will require that all but the smallest employers provide paid sick leave to their Seattle employees. Sick leave mandates under the new law increase depending on the size of a company’s workforce, and employees must be allowed to use the leave for their own or their family members’ illnesses (“Paid Sick Leave”), as well as for certain safety-related reasons (“Paid Safe Leave”).

Seattle employers should use the coming months to plan how to best structure their paid leave programs to comply with the new law. The law has posting requirements and allows complaints to the Seattle Office for Civil Rights, including recovery of damages where violations are found (but not private lawsuits). Employers have an opportunity to provide comment to the City regarding the law before rules under the law are issued (see below).

Key aspects of the comprehensive new Paid Sick Leave and Paid Safe Leave ordinance include:

  • Coverage. Employers of five or more full-time equivalent (“FTE”) employees (employees working outside Seattle must be counted) are covered. Employees, including temporary and part-time employees, who work in Seattle at least 240 hours in a calendar year, must be allowed to accrue leave.
  • Waiting Period. Leave accrues from date of hire, but employees cannot begin to take leave until 180 calendar days after date of hire.
  • Mandated Leave and Minimum Caps. The amount of required leave increases with the number of FTE employees. Employers in the different tiers are required to allow their employees to accrue leave at the following minimum levels:
    • Tier One Employers of 5-49 FTE employees must provide at least one hour of accrued paid leave time for each 40 hours worked, up to a minimum ceiling of 40 hours per year.
    • Tier Two Employers of 50-249 FTE employees must provide at least one hour of accrued paid leave time for each 40 hours worked, up to a minimum ceiling of 56 hours per year.
    • Tier Three Employers of 250 or more employees must provide at least one hour of accrued paid leave time for each 30 hours worked, up to a minimum ceiling of 72 hours per year.
  • Basis of Accrual. Non-exempt employees accrue leave time based on hours actually worked. Exempt employees’ leave accrual is based on their regular weekly schedule, up to 40 hours maximum.
  • Carryover Required; No Payout on Termination. Mandated carryover is required for up to the same amount of leave time employers are required to allow an employee to accrue in any given year. (For instance, for employers of 49 or fewer, up to 40 hours may be carried over.) Payout on termination is not required.
  • Special PTO Requirement for Largest Employers. Tier Three Employers that use a “universal” paid leave program (usually referred to as “paid time off” or “PTO”), rather than dedicated sick leave, must provide more paid leave under the law than those employers with dedicated sick leave. Tier Three Employers must allow accrual of at least 108 hours of paid leave per year and allow carryover up to the same amount.
  • Leave Use. Leave can be used for the following purposes:
    • Sick Leave. Absence resulting from an employee’s or a qualifying family member’s illness or injury, including diagnosis, treatment and preventative care. (Qualifying family members are the same as under Washington’s Family Care Act: spouse, registered domestic partner, child, parent, parent-in-law or grandparent.)
    • Safe Leave. Absence (1) related to domestic violence, stalking or sexual assault of an employee or qualifying family member (amount of leave allowed and qualifying family members are the same as under Washington’s domestic violence leave law), or (2) due to a public health-related closure of the employee’s place of business or a child’s school.
  • Notice and Certification. An employee must provide at least 10 days’ notice of foreseeable leave, and must generally follow employer notice policies. Certification of leave use is limited to leaves of three or more days. Where the employer does not provide health insurance, the employer must pay at least half of medical costs associated with obtaining the certification.
  • Considerations and “To-Dos.”
    • Opportunity for Comment to the City. Employers have the opportunity to provide comments to and receive updates from the City of Seattle related to the implementation of the law. An FAQ is expected by the end of the year on their website, and draft rules in the spring of 2012. Write to Elliott Bronstein at the Seattle Office for Civil Rights, at elliott.bronstein@seattle.gov, to be included in the notification list, and with any questions or comments you have about the law.
    • Collective Bargaining Agreements. The ordinance allows unions to expressly waive their members’ rights under the law. To avoid application of the law, employers should take steps to negotiate with their unions for a “clear and unambiguous” waiver and put it in writing.
    • Review Sick and Related Leave Policies, Including Short-Term Disability Policies. Employers must review policies and consider whether changes are needed to meet requirements under the new law.
    • Special PTO Requirements. Tier One and Tier Two Employers should make sure their PTO policies meet the requirements of the law to avoid having to provide additional paid sick and safe leave. Tier Three Employers that use a PTO program need to allow accrual and carryover of additional paid leave as described above.

Stoel Rives is here to help employers plan for the implementation of this law on September 1, 2012, and will be providing comments to the City about the law in the near future. Please contact us for assistance.
 

 

Stoel Rives World of Employment Voted a Top 25 L&E Law Blog!

The results are in, and based on the votes from you, our readers, Stoel Rives World of Employment was selected as a LexisNexis Top 25 Labor and Employment Law Blog of 2011! See hereWe would like to take this opportunity to thank our readers for the initial nomination and the subsequent votes that made this distinction and honor possible. We hope you will continue to frequently check in on us as we continue to provide up to date and timely information, news items, expert anaylis, and helpful tips for employment and labor law practictioners.

Thanks again!

-Your Stoel Rives World of Employment Bloggers.

The EEOC Reiterates the Importance of the Interactive Process

A recent decision from the federal Equal Employment Opportunity Commission (EEOC) reminds employers of their affirmative duty to engage in an interactive process once an employee raises a medical condition and requests some change to their work environment to accommodate it. The Americans with Disabilities Act (ADA), and the Rehabilitation Act at issue in Harden v. Social Security Administration, protect an employee from discrimination based on a disability, where the employee can otherwise perform his or her job with a reasonable accommodation. Tips for the interactive process are provided below, and next week we will go through a “hypothetical.”

In Harden, a claims assistant who was frequently late notified the SSA about her depression and general anxiety which were causing her problems sleeping and functioning early in the morning. She requested approval to arrive between 9:00 and 9:30 a.m., rather than between 7:00 and 9:00 a.m. like other employees, or else to use leave rather than leave without pay or discipline. The claims assistant supplied the SSA some medical documentation, but the SSA found that the documentation did not show that her medical condition kept her from getting to work before 9:00 a.m. The SSA denied the employee’s request for a modified schedule, and disciplined her when she was again tardy.

Based on information about the employee’s medical condition that came out during the EEOC complaint process, the EEOC found that the SSA engaged in discrimination. The claims assistant had a disability that could have been reasonably accommodated with a modified schedule. The EEOC disagreed with the SSA’s argument that medical documentation provided during the complaint process was irrelevant to the SSA’s decision to deny the modified schedule and discipline the employee.

What does Harden teach us? Disability discrimination laws place affirmative duties on employers to engage in a meaningful process after an employee raises a medical condition. Do not cut short the interactive process because the facts will come out eventually. This 4-step process provides a helpful framework for an ADA request.

 

1.        Get the facts: What is the medical condition? Get documentation from the employee’s doctor if necessary (with an appropriate release), including any limitations and potential accommodations. Allow the employee or doctor to provide additional information if you are not satisfied. What is this employee’s job? Identify the essential functions of her position. Is the employee performing the job, except for reasons related to her disability?

 

2.         Decide whether the employee is eligible for an accommodation: Based on the facts, is the employee qualified for the job? Can he or she perform the essential functions of the job, with or without an accommodation? Determine whether the individual has a physical or mental impairment that substantially limits a major life activity. Is the employee regarded as having such impairment?

 

3.         Have an interactive dialogue with the employee about an accommodation: Ask the employee what he or she wants. Quite frequently, this simple communication can result in a practical, cost-effective solution that works for everyone involved. Can the employee do the essential functions of the job with the employee’s proposed accommodation? Identify other accommodations that may work, and consider the effectiveness of each proposed accommodation. Discuss the cost and burden of each effective accommodation and assess whether it would be an “undue hardship.”

 

4.        Put the accommodation into action: Document the dialogue with employee. Choose and implement an accommodation. Document the expectations on all sides. Inform others of the accommodation, only to the limited extent they must know (such as a supervisor). Ensure confidentiality at all times, and maintain a separate confidential file for the employee’s medical documentation. Reassess the effectiveness of the accommodation after a time.

Thanks For Nominating Stoel Rives World of Employment As A Top 25 L&E Law Blog!

Based on feedback from you, our readers, LexisNexis has nominated the Stoel Rives World of Employment as a "Top 25" law blog in the Labor and Employment category!  Thanks to those of you who nominated us to this elite group.  Readers now have until September 12 to vote for their favorite blog.  After voting is completed LexisNexis will announce which of the nominated blogs are selected to the final top 25.

Please Cast Your Vote For Us

At this point we'd like to engage in a bit of shameless self-promotion, and urge you to cast your vote for us before September 12.  To do that, simply click here to vote, scroll to the very bottom of the page to the Add a Comment section, and add a comment.  In the comment field, type something like "I vote for the Stoel Rives World of Employment blog."  You can also view information about the competition and see the other nominated blogs on this page too.  If you haven't already used the LexisNexis Communities feature, you may need to create an account to be able to vote.

Again, thanks for the nomination and support!  (Here ends the shameless self-promotion...now we'll get back to blogging.)

- Your Stoel Rives World of Employment Bloggers

 

 

 

 

 

California Overtime Rules Apply To Work Performed In California By Out-Of-State Employees


The California Supreme Court has ruled that California’s daily overtime requirements apply to work performed in California by non-residents.  In Sullivan v. Oracle Corp., three employees of Oracle who were not residents of California worked as “instructors” and trained Oracle’s customers in the use of the company’s products.  Required by Oracle to travel, the plaintiffs worked primarily in their home states but also in California and several other states.  California is one of the few states that requires payment of daily overtime for hours worked in excess of eight in a day.  At issue in the case was whether these non-residents of California were entitled to daily overtime for days they worked in California.

In a unanimous decision, California Supreme Court held that the California Labor Code does apply to overtime work performed in California for a California-based employer by out-of-state employees, such that overtime pay is required for work in excess of eight hours in a day.  In reaching this conclusion, the Court noted California’s strong interest in applying its overtime law to all non-exempt workers, and all work performed, within the state’s borders.   The Court stated that to permit non-residents to work in California without the protection of the state’s overtime law would completely sacrifice, as to those employees, California’s important public policy goals of protecting health and safety and preventing the evils associated with overwork.  Additionally, not applying California law would encourage employers to substitute lower paid temporary employees from other states for California employees, thus threatening California’s legitimate interest in expanding the job market.

While not great news for employers, this decision provides guidance to multi-state employers about how to pay non-exempt employees who work occasionally in California.  However, the Court left some important questions unanswered.  First, the decision does not directly apply to employers that are based outside of California.  The Court specifically limited its holding to out-of-state employees working for California-based employers.  The question remains whether an employer based outside of California must comply with California’s overtime rules for those days its non-California employees work in California.  Even though the ruling does not specifically address this scenario, the reasoning the Court employed in reaching its decision leaves the door open for an argument that its holding applies to employers based outside of California.  Also, the Court was not asked to address, and did not address, whether other provisions of California’s wage law -- such as the contents of pay stubs, meal period requirements, the compensability of travel time, the accrual and forfeiture of vacation time, and the timing of payment to employees who quit or are discharged -- apply to work performed in California by non-resident employees.
 
California-based employers with non-exempt employees in other states who occasionally work in California should immediately confirm that all such employees are paid overtime in conformity with California law when working in California. 
 

DOL Demonstrates Commitment to Wage and Hour Violations with Launch of New "DOL-Timesheet" App

In a highly visual public expression of its commitment to wage-and-hour violations, and to encouraging employees to file wage and hour complaints, the Department of Labor’s Wage and Hour Division entered the world of Smartphone apps when it recently launched its own “DOL-Timesheet” app for the iPad and iPhone. At first glance, the DOL-Timesheet App may not appear to be much more than the contemporary technological equivalent of a pad of paper, pencil, and some simple math. But not only does the DOL-Timesheet app track an employee’s hours and wages, it also: (1) contains a glossary of wage and hour terms; (2) informs workers about their rights under the Fair Labor Standards Act (FLSA); (3) contains easy to use links to contact the DOL’s Wage and Hour Division via phone or email; and (4) specifically instructs employees on how to file a wage violation complaint.

 

With all it does, there are still significant shortcomings and problems with the DOL-Timesheet app. The DOL candidly admits that the app does not address tips, commissions, bonuses, deductions, holiday pay, pay for weekends, shift differentials and pay for regular days of rest. Additionally, the potential for human error or abuse creates inherent problems with reliability which may call into question the apps utility in a court of law. For example, it is unclear whether the DOL-Timesheet app includes metadata that would allow an employer to determine the time and date employees entered their time which in turn creates the potential that employees might overinflate their hours to seek benefits and compensation to which they may not be entitled.

Despite its shortcomings, the DOL left little question that it hopes and intends to use the information an employee tracks through its new app in its enforcement efforts when it stated the following in its press release announcing the app:

 

“This new technology is significant because, instead of relying on their employers’ records, worker now can keep their own records. This information could prove invaluable during a Wage and Hour Division investigation when an employer has failed to maintain accurate employment records.”

 

For employers, the key phrase in the DOL’s statement is the last. An employee’s personal time records are unlikely to supplant or surpass an employer’s properly maintained time records. But in the absence of a well maintained and effective time-tracking system, an employee’s personal time records will quickly rise in value in the court’s eyes.

 

It remains to be seen whether the DOL-Timesheet will garner much attention and use from employees. However, regardless of its ultimate popularity, the DOL-Timesheet app serves as a clarion call to employers to get their proverbial wage-and-hour houses in order. If you are uncertain whether your wage and hour practices hold water under the FLSA, now is as good a time as any to take a good hard look at them.

Supreme Court Rules Oral Complaints Of Wage Violations Are Protected Under FLSA

Today the U.S. Supreme Court issued another employee-friendly opinion in Kasten v. St. Gobain Performance Plastics Corp., holding by a 6-2 margin that the Fair Labor Standards Act ("FLSA") anti-retaliation provisions protect an employee’s oral complaints to supervisors about wage and hour violations. This is the latest of three opinions this term that have expanded the reach of various anti-retaliation provisions in employment discrimination statutes. (See World of Employment's analysis of the other two cases, Thompson v. North American Stainless, LP and Staub v. Proctor Hospital).

In Kasten, the plaintiff complained orally to his supervisors on several occasions that the location of time clocks in the workplace violated the FLSA, because it prevented employees from punching in and out while they were donning and doffing protective clothing and equipment.  Shortly afterwards, his employment was terminated for, ironically, multiple failures to properly punch in and out.  Plaintiff sued, claiming that his termination was in retaliation for his having complained that the Company was violating the FLSA.  The District Court dismissed his case, and the 7th Circuit affirmed, holding that the FLSA anti-retaliation provision, which prohibits employers from taking adverse action against employees because they “file any complaint or instituted or caused to be instituted any proceeding” complaining about wage and hour violations, protects only written complaints, not oral ones. 

The Supreme Court reversed, holding that oral complaints are also protected under the FLSA. The Court held first that the phrase “file any complaint” in the statute was ambiguous; the term “file” generally indicated a writing (although not always), while “any” indicated Congress intended to cover many different types of complaints.  The Court went on to look at the legislative history and purpose, Department of Labor interpretations, and numerous lower court opinions to ultimately decide that Congress must have intended the FLSA to protect oral complaints. 

At the end of the day, this opinion may change little for west coast employers. While the Kasten decision resolves a split among the Circuit courts, the law in the Ninth Circuit (which includes, amongst others, Oregon, Washington and California), has recognized for over a decade that oral complaints are protected under the FLSA. Further, the anti-retaliation provisions of other state and federal anti-discrimination statutes—most notably Title VII—also protect employees who make oral complaints of discrimination. Finally, the opinion merely holds that Mr. Kasten can go ahead with his lawsuit—he still needs to prove his case that his employer fired him because of his protected activity.

Still, Kasten and other recent U.S. Supreme Court decisions in Thompson and Staub provide useful reminders that courts--including the Supreme Court--read anti-retaliation protections broadly.  Employers must be careful to ensure and adequately document that any adverse employment actions against employees who have made any complaints about alleged unlawful activity in the past are for legitimate business reasons only. Retaliation claims are already the most common type of employment claims filed against employers.  This opinion isn’t going to change that. 

NLRB Facebook Settlement Creates More Questions Than It Answers

On Monday, February 7, the NLRB issued a news release about a settlement in a case in which an employee criticized her supervisor on her Facebook page. In that post, she called her supervisor a “17,” (which is terminology for a psychiatric patient) and said her supervisor was being a “d***” and a “scum***." This new development has garnered a significant amount of media attention.

We say “development” because, despite the media furor over this case, there was no landmark opinion issued by the NLRB, which is the way the Board makes a policy change or an announces a new policy. Instead, an NLRB Regional Director in Hartford, Connecticut -- there are over 35 of them nationwide -- decided to issue a complaint alleging the firing of the employee was unlawful and the policy was overbroad. After the complaint was issued, there was no hearing before an administrative law judge and there was no ruling by Members of the NLRB in Washington. There was simply a settlement for an undisclosed amount, which was likely modest since remedies under the NLRA are limited to reinstatement (waived in this case), back pay and benefits. The company also agreed to revise its policy.

So, what’s to be learned from this settlement? Not much. The basic rule that came into play is an employee’s right to engage in protected and concerted activity – sometimes referred to as “free speech” in the workplace. Under NLRB case law, broad rights are provided to employees to criticize their supervisors, their employer, and, in general, to communicate in the work place about good and bad developments, such as pay raises and bonuses. However, employees cannot make threats of physical violence and they cannot engage in disloyal conduct.

Unresolved questions going forward include:

(1) Whether an employee is engaged in concerted activity when posting on a social media platform?

(2) What is protected and unprotected on social media, and do the same rules that apply to verbal communications in the workplace apply to social media?

(3) Does it make a difference if the post is done during non-work time?

There are several issues to work through and unfortunately this case clarified very little.
 

Editor's Note: For more in-depth analysis and discussion about this case, check out Victor's appearance on KGW's Live at 7.

Companion Anti-Union Bills Slated to Pass Idaho Legislature

Never shy about taking on unions, especially in a state where organized labor enjoys little support outside the government sector, the Idaho Legislature recently introduced a pair of bills for addition to the state’s existing Right to Work statute. 

Senate Bill 1007, named the “Fairness in Contracting Act,” is intended to “promote fairness in bidding and contracting.”  This bill provides, among other things, that a “contractor or subcontractor may not  directly or indirectly receive a wage subsidy, bid supplement or rebate on behalf of its employees, or provide the same to its employees, the source of which is wages, dues or assessments collected by or on behalf of any labor organization(s), whether or not labeled as dues or assessments.”  The proposed measure would also prohibit labor organizations from “directly or indirectly” paying “a wage subsidy or wage rebate to its members in order to directly or indirectly subsidize a contractor or subcontractor, the source of which is wages, dues or assessments collected by or on behalf of its members, whether or not labeled as dues or assessments.”  Use of any fund financed by wages collected by or on behalf of any labor organization, whether or not labeled as dues or assessments, to subsidize a contractor or subcontractor doing business in the state of Idaho would be deemed unlawful. 

Contractors, including subcontractors, or labor organizations that violate the provisions of this proposed law will be guilty of a misdemeanor and could be fined an amount not to exceed ten thousand dollars ($10,000) for a first offense, twenty-five thousand dollars ($25,000) for a second offense, and one hundred thousand dollars ($100,000) for each and every additional offense. 

The legislation would also confer standing on any “interested party,” including a bidder, offeror, contractor, subcontractor or taxpayer, to challenge any bid award, specification, project agreement, controlling document, grant or cooperative agreement in violation of the provisions of the law.  If an interested party prevails in a lawsuit challenging the bill, it will be awarded costs and attorney's fees.

A companion bill, Senate Bill 1006 (“The Open Access to Work Act”), introduced at the same time, bars bidders on public works projects from paying a predetermined amount of wages or wage rate; or type, amount or rate of employee benefits.  The law does not apply when federal law requires the payment of prevailing or minimum wages to persons working on projects funded in whole or in part by federal funds.  A separate provision makes clear that the contractor party cannot be required to enter into an agreement with a labor organization as part of the contract.

Both of these bills were printed and sent to the State Affairs Committee for further action last week.  Yesterday, the full Senate considered and voted on SB 1006, approving it by a 27-7 vote. It has now been referred to the Idaho House. SB 1007 on Monday passed the Committee by a 7-2 party line vote, and will soon be taken up by the full Senate. 

Although these bills remain at a relatively early stage, questions have been raised about their legality and potential conflict with federal labor law.   Stay tuned for more.

NLRB to Consider Scope of Permissible Solicitation On Employer Premises

The National Labor Relations Board (NLRB) is on its way to making some significant changes, which favor organized labor.  One change that may be coming relates to non-solicitation rules.  These rules determine when a union organizer can come on a company’s property and solicit employees to join a union.  For the time being, a company can prohibit a union organizer from coming on its property so long as it’s not discriminating by allowing other third parties on its property to solicit employees. 

There are exceptions; for example, an employer can allow third parties on its property if it’s intended as a benefit for employees, such as a yoga or fitness company holding meetings on site to describe group rates.  An employer is also allowed to bring charities such as United Way on site to solicit employees.  If an employer allows only these types of solicitations, it is not considered discriminatory to prohibit union organizers from the premises.  The blurry line relates to the situation when employees solicit for third parties that are good causes but not charities, such as the girl scouts or fundraisers for public schools. 

A pending NLRB case called Roundy’s involved distribution of handbills on company property in front of its retail stores (sidewalks and parking lots).  The handbills asked consumers not to shop at Roundy’s claiming unfair wages.  The Union contends that Roundy’s allowed several outside third parties on its property – bloodmobiles, Salvation Army, Veteran of Foreign Wars, Shriners and others – and that union agents should be allowed the same access.  

The NLRB took the unusual step of requesting amicus briefs from interested parties before it makes a decision.  This often signals a major policy shift.  Given the labor-friendly composition of the NLRB, it’s likely to give greater rights for union organizers to enter onto a company’s property, such as parking lots, sidewalks and possibly inside the facility itself – in a non-work area.  If this becomes law, it’ll be much easier for an organizer to solicit an employee on company property. 

One step employers can take now is to review and update their non-solicitation policy and ensure that’s it’s being applied in a consistent manner.  That is, ensure that you’re not allowing third parties on your property to solicit your employees – or you may be opening your door to a union organizer. 

Oregon Minimum Wage to Rise to $8.50/Hour in 2011

The Oregon Bureau of Labor and Industries recently announced that Oregon's minimum wage will increase by ten cents to $8.50 an hour effective January 1, 2011.  Oregon's minimum wage has been $8.40 an hour since January 1, 2009.  Click here to read Labor Commissioner Brad Avakian's press release on the minimum wage increase

As a result of Ballot Measure 25, passed by voters in 2002, the minimum wage is adjusted annually based on changes in inflation as measured by the Consumer Price Index (CPI). The Labor Commissioner is charged with adjusting the minimum wage for inflation every September, rounded to the nearest five cents.

And for your viewing pleasure, here's a fascinating video of an employee who we hope earns much more than minimum wage.  At least we know we wouldn't do this job for under $1,000 an hour:

Supreme Court Invalidates Nearly 600 Decisions Made by Two-Member NLRB

This morning the United States Supreme Court issued a highly-anticipated decision in New Process Steel v. National Labor Relations Board, ruling 5-4 to effectively invalidate almost 600 decisions made by the NLRB during the time it only had two members. 

Normally, the NLRB is comprised of five members, but typically delegates its powers to decide most cases to panels of three members, in which a two-member majority can (and often does) carry the day.  However, from late 2007 through March 2010, the Board only had two members.  Those two members argued that they had the authority to decide cases as long as they agreed on the decision; after all, had they been the majority on a three-person panel, they would have made the same decisions.

The Supreme Court disagreed.  It held that the National Labor Relations Act (NLRA), the law that gives the NLRB its powers, only allows the Board to delegate the authority to decide cases to a panel of at least three members.  Accordingly, no two-member panel could have decision-making authority under the NLRA. 

What does this mean for employers?  If you had one of the 600 cases decided by the two-member Board, it may mean that your case will have to be reconsidered by a new three-member panel.  We suspect, however, that the vast majority of those cases will be decided the same way.  For the rest of us, this decision will have little impact.  The two-member Board did not take up any controversial cases and did not issue any decisions that would overturn existing precedent or make "new law." 

More Federally Mandated Wallpaper: Federal contractors must post a notice of employee rights under the National Labor Relations Act

 

Once again, employers are being given an old line: we are from the federal government and we’re here to help you . . . with your office decorating. Shortly after his inauguration, President Obama issued Executive Order 13496 (the “Order”). The Order directed that all federal contractors post a notice to their employees advising the employees of their rights under the federal labor laws. The Order required the United States Department of Labor to prepare implementing regulations, including the text of the posting. After a year’s work, the Department has completed its work, and the required poster is now available. Federal contractors and all subcontractors must begin posting the required notice by June 19, 2010.

 Posting requirements are not new for federal contractors. In the 1980s, the first President Bush required contractors to post a notice advising employees of their rights to refrain from supporting unions’ political activities (the so-called “Beck” notices named after the U.S. Supreme Court case addressing the issue). President Clinton issued an executive order rescinding the Beck poster requirement; the second President Bush then reinstated the posting obligation. No surprise – in the Order President Obama again rescinds the obligation to post the Beck notice.

The new poster is available from the Department of Labor’s website here. The poster generally advises employees about their rights to engage in protected concerted activity under the National Labor Relations Act, as well as their right to refrain from engaging in that activity. The poster also describes the industries and employees that are not subject to the NLRA. Generally, the poster does a fair job of describing employee rights, and unlawful actions by both employers and unions. Of course, a single 11-inch by 17-inch poster cannot describe all of the complexities that have developed in the 75 years of NLRA enforcement. For example, health care employers should note that the poster does not even attempt to address the special rules applicable to various union activities in patient care areas.

The obligation to post the notice applies to all federal contracts that are above the “simplified acquisition threshold” applicable to federal contracts. Generally, the simplified acquisition rules are applicable to contracts with a total value less than $100,000. These provisions of the federal acquisition regulations are sometimes complex, and employers with questions as to their coverage should consult their attorney.

Federal contractors are required to include a contract provision requiring posting of the notice in all subcontracts, with a value of more than $10,000. Thankfully, in the final regulations the Department backed off its original proposal that subcontracts had to include the full text of the poster; now contractors can satisfy their obligations in this regard by incorporating the regulation by reference. Contractors should note that among the requirements of the contract clause is the obligation for subcontractors to include the provision in their contracts with their subcontractors; the Department’s regulations thus expressly require all businesses performing work on the federal contract to post the notice, regardless of their subcontract “tier” or whether the subcontract might itself be under the simplified acquisition threshold.

The poster must be physically displayed in the normal “conspicuous places” other employment related posters are located. The notice must be posted at all locations on which work on the federal contract is performed or is being allocated to the federal contract. When a substantial portion of the workforce does not speak English, the notice must be posted in the language spoken by those employees. When the employer routinely provides employees notices by electronic means, the employer must do so in this instance as well, typically by providing a link to the Department of Labor website.

What is a federal contractor or subcontractor to do?

For federal contractors or subcontractors that are already ubiquitously unionized, the poster may not cause any substantial headaches. Indeed, reminding unionized employees that there are certain things their union cannot do, as the poster plainly does, may not be a bad thing. For federal contractors or subcontractors that are not currently unionized, however, substantial issues are raised – especially if the employer wants to remain union-free. The new poster may raise employees’ awareness of their rights under the NLRA. It should also raise union-free employers’ attention to a systematic union avoidance program:

  • Nothing in the Executive Order or the Department’s regulations prevents an employer from posting its own notice, right alongside the newly required poster.
  • Employers should remind employees that it is official company policy that the employer does not believe a union is necessary or appropriate.
  • The employer should remind employees of the advantages they enjoy by being union-free.
  • If the company has not reviewed its nonsolicitation and nondistribution policy, it should be reviewed promptly to make sure that all of its provisions are in compliance with the law. If the company does not have a nonsolicitation and nondistribution policy – implement one!
  • Make sure that your nonsolicitation and nondistribution policy, and any other policies or practices that might impact employees or others engaging in union organizing, are applied in a fair and nondiscriminatory fashion.

Of course, before undertaking any these actions, federal contractors or subcontractors should consult with their labor law attorney.  

 

 

Ninth Circuit Issues Split Decisions on Compensation for Travel Time and "Off-the-Clock" Work

 

Employees who drive company vehicles between home and work will find little to cheer about in a recent Ninth Circuit decision . . . unless they live in California.  In Rutti v. Lojack Corporation, a three-judge panel refused to relax the rule that commuting time is non-compensable under the Fair Labor Standards Act (FLSA).  

The employee, who installed vehicle recovery systems, contended that his travel time between home and worksites was compensable under the FLSA and California law because his employer required him to drive company vehicles and significantly restricted his activities while doing so.  For example, the employer prohibited the employee from transporting passengers and engaging in personal pursuits, and required him to drive directly to and from the worksite with his cell phone turned on.  

All three judges rejected that argument under the FLSA, holding that use of an employer's vehicle to commute is non-compensable even if it is a condition of employment and that the restrictions placed on the employee's activities were incidental to his principal job activities.  The unanimous panel also rejected the employee's argument that his commuting time was compensable under the "continuous workday doctrine," under which an employee's workday generally lasts until he has completed all of his principal activities during the day. 

Continue Reading...

Oregon Legislature Bans Workplace Credit Checks

This week the Oregon House voted to prohibit employers from using credit histories for any employment purposes including hiring, discharge, promotion and compensation.  The Oregon Senate passed the bill last week, and Governor Ted Kulongoski is expected to sign the bill into law effective July 1, 2010.  Click here to download a copy of the bill, SB 1045

A violation of the new law will be an unlawful employment practice, and an aggrieved employee could either file a complaint with the Bureau of Labor and Industries (BOLI) or file a civil lawsuit for injunctive relief, reinstatement or back pay, and attorney's fees.  

The new law will have some narrow exceptions:  banks and credit unions, public safety and law enforcement officers, employers who are required by state and federal law to use credit histories for employment purposes, and other employment if credit history is "substantially job-related" and the use of the credit check is disclosed in writing.  The bill does not give any guidance on what it means for a credit check to be "substantially job-related," but we're assuming that courts will construe that requirement very narrowly.

Oregon employers who are currently using credit checks as part of their employment processes should make sure they fit into one of the exceptions and, if not, find alternatives by July 1.  The law only prohibits the use of credit history, so other background checks - such as criminal background checks - are not affected.

Supreme Court to Rule on Authority of Two-Member NLRB

This week the U.S. Supreme Court agreed to hear an appeal in New Process Steel v. NLRB and determine whether the National Labor Relations Board (NLRB or "the Board") has the authority to decide cases with only two sitting members. 

The NLRB is the independent federal agency that administers the National Labor Relations Act, the primary law governing relations between unions and employers in the private sector.  Typically, the NLRB is made up of five members, appointed by the President.  There are currently three vacancies on the Board, leaving only two sitting members.  The statute governing the NLRB's powers (29 U.S.C. § 153(b), if you really care) provides that "three members of the Board shall, at all times, constitute a quorum of the Board."  Nevertheless, the two remaining Board members have decided a number of cases, under the theory that as long as those two members agree, they would have formed the majority of any three-member quorum anyway. 

The Court will resolve a split between the federal appellate courts.  In New Process Steel v. NLRB (the case on appeal) the Seventh Circuit held that the current two-member NLRB does have the power to decide cases.  The First Circuit agreed in in Northeastern Land Services v. NLRB.  However, the D.C. Circuit disagreed in Laurel Baye Healthcare of Lake Lanier v. NLRB and rejected the power of a two-member Board to do anything.  If you want to read more about this dispute, click here to read New Process Steel's Petition for Writ of Certiorari to the Court. 

For most employers, New Process Steel will have little relevance--none of the cases decided by the two-member Board were particularly controversial, and none represented a significant departure from existing NLRB law.  The only employers with a significant stake in the outcome of New Process Steel will be those employers whose cases were ruled on by the two-member Board.  If the Court reverses New Process Steel, those cases will be reheard by a future three-member panel, and will likely be upheld. 

Key EFCA Ally Withdraws Support for Card-Check Bill

California Senator Dianne Feinstein has withdrawn her support for the Employee Free Choice Act (EFCA), according to this editorial in the Oakland Tribune.  Because of the recession, the time is not right, according to Senator Feinstein, who stated that she still hopes a union/management compromise is possible.

Senator Feinstein's withdrawal of support may put the nail in EFCA's coffin - at least in its current form.  It remains possible that a modified form of EFCA - without the original bill's controversial card-check provision - will still pass in late 2009 or 2010.  A revised EFCA will likely replace the card check with faster election periods, giving employers less time to actively campaign against unionization efforts.  Even with an apparently watered-down version of EFCA on the way, employers should be prepared to face a radically different set of federal labor laws as soon as January 1, 2010.  The Stoel Rives World of Employment will continue to keep an eye on EFCA and bring you updates as they occur.

The First Monday in October: Supreme Court Roundup

The first Monday in October traditionally marks the beginning of the United States Supreme Court's yearly term - and it provides an excellent opportunity to look at the cases the Court will be hearing this year.  In an earlier post, the World of Work brought you detailed discussion of the Court's only Title VII case this term:  Lewis v. City of Chicago.  Here's a sampling of other labor and employment-related cases to watch for throughout the term:

This morning, in Mohawk Industries, Inc. v. Carpenter, the Court will consider whether an employer's attorney's investigation of an internal complaint is protected by the attorney-client privilege.  The internal complaint alleged that the company was conspiring to hire individuals who were not authorized to work in the United States.  The case involves a former employee's claim for witness tampering; a separate lawsuit involving the alleged conspiracy is proceeding on a separate track.

On October 7, the Court will hear a case involving the Railway Labor Act.  The issue in Union Pacific Railroad Co. v. Brotherhood of Locomotive Engineers is whether the Seventh Circuit Court of Appeals had the power to overturn, on due process grounds, an arbitration award in the railroad's favor.  

On October 14, in Perdue v. Kenny A., the Court will consider whether attorney fee awards under 42 USC 1988 can be enhanced when the lawyer does a particularly good job.  Section 1988 is a common basis for fees in employment-related lawsuits.

On December 9, the Court will hear Stolt-Nielsen SA v. AnimalFeeds International.  This case asks the Court to decide whether an employee bringing a claim under an arbitration agreement may sue, not only on his own behalf, but on behalf of a class of similarly situated employees.  In this case, the arbitration agreement did not specifically allow class claims, but the arbitrators allowed those claims anyway.

Finally, on a date to be announced, the Court will hear Granite Rock Co. v. International Brotherhood of Teamsters.  This case again involves questions about arbitration.  Here, the issue is whether an arbitrator (not a court) may decide whether a valid collective bargaining agreement exists.

New Website for Disability Information

The Department of Labor's Office of Disability Employment Policy today launched a new website that may be of use to employers seeking information on how to accommodate a disabled worker.  At www.disability.gov an employer can research the applicable law and regulations, get ideas for appropriate reasonable accommodations, and locate additional resources.  For example, clicking here will take you to information about accommodating deaf and hearing impaired workers.   And here is useful information about tax incentives for complying with the ADA.  The new site offers a myriad of social networking capabilities including a Twitter feed, RSS feeds and a blog.   The site also includes a handy multi-state guide which employers could find very useful as they work to comply with all applicable federal and state disability laws.  

Online Game Educates on EFCA, Tattooing

We have a favorite new website here at the Stoel Rives World of Employment:  Card Checked:  The Game (sorry, failblog.org).  Card Checked is an online game where you can play a "young and talented tattoo artist living in America where the Employee Free Choice Act (EFCA) has become the law of the land."  As a player, you can dodge union organizers, withstand intimidation from pro-union coworkers, and experience the anguish and horror when union thugs threaten your pet cat, Min Min.  (Notably, the game includes links to documentation showing that all of these examples of union organizing tactics are real, even down to threatening pets.)

Card Checked is hosted by the Americans for Tax Reform, a conservative group, and its affiliate, the Alliance for Worker Freedom.  While we're not endorsing the politics of these groups, their Card Checked site is creative and informative, and presents accurate information on how union organizing will likely be conducted if EFCA's card check and mandatory aribitration provisions become law.  For more on EFCA, click here for the Stoel Rives World of Employment's EFCA coverage

Democrats Delete Card Check from Employee Free Choice Act

According to this article in today's New York Times, Senate Democrats have dropped the controversial card check provisions from the proposed Employee Free Choice Act (EFCA). 

The card-check provision would have allowed unions to organize employees and begin representing them as soon as a majority of employees signed cards saying they wanted a union. Under current law, unions generally form following secret-ballot elections. 

Even though the Democrats hold a 60-40 majority in the Senate, several moderate Democrats opposed the card check provision as depriving workers of the right to vote.  By abandoning the card check, Democrats have all but assured the passage of some modified form of EFCA this term. 

So if card check is out, what will the bill look like?  A revised EFCA will replace the card check with faster election periods, giving employers less time to actively campaign against unionization efforts.  Even with an apparently watered-down version of EFCA on the way, employers should be prepared to face a radically different set of federal labor laws as soon as January 1, 2010.  The Stoel Rives World of Employment will continue to keep an eye on EFCA and bring you updates as they occur. 

Union Civil Wars and EFCA

The NY Times recently ran a story about internal union squabbles, which are hindering organized labor from achieving its political goals. The high profile dispute is between the Service Employees International Union (SEIU) and the National Union of Healthcare Workers (NUHW). 

The NUHW broke off from the SEIU and is now trying to take over several bargaining units formerly represented by the SEIU. The dispute is complex, but seems to boil down to a power struggle between the two leaders (Andrew Stern at the SEIU and Sal Roselli with NUHW). Hanging in the balance is over 2 million union members. 

What does this mean for employers? If you’re non-union, this could be a good or a bad thing.  It could be bad if you have to deal with a 3-way race, where your employees vote for the SEIU, NUHW or no union. If that's the case, you can expect the campaign to be active and aggressive with plenty of unfair labor practice charges. On the other hand, employee-voters could get turned off by the two unions attacking each other and decide not to support either. 

 

What does this mean for the Employee Free Choice Act (EFCA - the card check bill)? If key unions can’t work together, the labor movement may have difficulty getting an effective EFCA passed.

Al Franken and EFCA

After months of litigation, Al Franken has been declared the winner of the Senate race in Minnesota.  He will be the 60th Democrat in the Senate, which could enable the Democrats to override a filibuster in the Senate. 

So the question becomes where does Senator Franken stand on the Employee Free Choice Act (EFCA)?  Just as a reminder, this is the bill, which gives unions the right to organize by showing that a majority of employees signed cards and it basically does away with secret ballot elections.

Here is Senator Franken's answer:

Ouch.  He doesn't sugarcoat it, does he?  Senator Franken is a big supporter of EFCA.  So, what does this mean?  It makes it more likely that Democrats will push the original bill forward in the Senate or will not compromise (too much) on the original terms.  Stay tuned. The EFCA drama is likely to play out in 2009. 

Supreme Court Agrees to Hear Case About Meddling International Union

The US Supreme Court just agreed to hear a case asking just how much international unions will be allowed to meddle in the affairs of their local affiliates.  In Granite Rock v. Teamsters, the employer sued the International Brotherhood of Teamsters in federal court claiming that the International interfered with the relationship between the employer and the Local Teamsters union. 

In Granite, the employer and the Local had reached a tentative new agreement which contained a no-strike clause. The employer alleged that the Local ratified the agreement and then engaged in a strike.  Apparently a high ranking official of the International was the motivating force behind the strike.  The 9th Circuit held that the employer could not sue the International because the agreement was between the employer and the Local, and did not involve the International.  The Supreme Court granted cert and will hear the case, perhaps recognizing that international unions are often working behind the scenes with their local unions.

The Court will probably not hear the case until the 2010 session, and it could be some time before an opinion is issued.   It is not uncommon for employers to have good relationships with local unions.  Sometimes those relationships are strained through pressure from out-of-town international union officials.  Currently, international unions are somewhat insulated from liability for meddling in negotiations and other ongoing business relationships between local unions and employers.  Ultimately, this decision could open a new legal avenue for employers to hold international unions accountable for their actions.

 

9th Circuit Orders Damages, but Not Reinstatement for Unauthorized Alien Workers

What's an employer to do when it is ordered to reinstate former employees, but those employees are not legally authorized to work in the United States?  Pay liquidated damages instead, according to the Ninth Circuit's recent decision in NLRB v. C&C Roofing Supply Inc

In C&C, the National Labor Relations Board (NLRB) alleged that the employer unlawfully fired 20 workers for engaging in union activity.  The parties reached a formal settlement that called for reinstatement of the illegally fired workers and payment of specific amounts of liquidated damages to each.  However, the employer then refused to reinstate the employees because many of them were unauthorized aliens and rehiring them would violate the Immigration Reform and Control Act (IRCA) and the Legal Arizona Workers Act, which both prohibit hiring unauthorized aliens. 

The Ninth Circuit solved the dilemma by ordering the employer to pay the agreed-upon liquidated damages, but did not require the employer to reinstate the unauthorized employees.  But how does this case square with Hoffman Plastic Compounds Inc. v. NLRB?  There, the U.S. Supreme Court held 5-4 that the board may not order back pay for unauthorized aliens, despite their firing in violation of federal labor law, because doing so would violate immigration policy expressed in IRCA.  In C&C, the Ninth Circuit dodged that issue by ruling that agreed-upon liquidated damages as part of a settlement do not raise the same issues as back pay ordered by the court, as the employees need not be "available to work" in order to receive liquidated damages.  Don't be surprised if this one gets appealed up to the Supreme Court for a determination if it really does square with Hoffman

Oregon Legislature Bans Mandatory Meetings

A new Oregon bill will prohibit employers from requiring employees to attend mandatory or "captive audience" meetings on, among other topics, labor unions.  Governor Ted Kulongoski is expected to sign the bill, which would them become law effective January 1, 2010.  Click here to read SB 519

SB 519 prohibits an employer from taking action against an employee who refuses to participate in communications concerning the employer’s opinions on religious or political matters. Religious or political matters is defined broadly and includes communications to employees about unionization.  An employee who suffers economic loss (through termination or suspension) as a result of the bill can sue his or her employer and recover treble damages.  The bill also allows employees to obtain an injunction prohibiting additional "captive audience" meetings. 

This law might not be long-lived:  the U.S. Supreme Court found a similar California law to be preempted by federal labor law.  Click here to read that opinion in Chamber of Commerce v. Brown.  Even if a court finds Oregon's statute to be similarly preempted (and we believe a court will), the law could still apply to employers that are not covered by federal labor law - namely, Oregon public and agricultural employers.  Also, the word from Salem is that the legislature will still revise the law to provide additional protections for religious employers (such as churches and some hospitals) who hold religious meetings, so keep an eye out for those changes in the next week or so. 

Labor Unions Targeting Green Energy Development

Labor unions are seeing a rare growth opportunity in green power.  Despite the recession, there has been a building boom in green energy, in particular solar and wind projects.  As reported recently in the New York Times, labor unions see something in green energy for them as well, and they're using intense political pressure to get it.

When a new solar or wind project is being built, a union will approach the builder and demand that it use only union labor on the project.  If the builder agrees, the union then urges local regulators to quickly approve the project; if the builder refuses, however, the union then raises myriad environmental concerns with regulators in an attempt to stall or even completely derail the project.  Apparently, a union-built solar installation won't have the same impact on the habitat of the short-nosed kangaroo rat or the ferruginous hawk as a non-union one.  Right. 

These tactics aren't new; labor unions have made aggressive use of the environmental laws for years to put pressure on traditional energy producers to use union labor.  But, with union membership in an overall decline, unions are desperate to maintain relevance in the growing green economy. 

Interested in wind, solar and other forms renewable energy?  Check out our sister blog, Renewable + Law, from Stoel Rives' Renewable Energy Initiative. 

Proposed Legislation Would Allow Employers to Fire Union Salts

The Truth in Employment Act of 2009 (TEA) would allow employers to lawfully fire employees who are suspected of “salting,” or attempting to organize the contractor's workforce from within on behalf of a labor union.  The bill was introduced in the Senate by Sen. Jim DeMint (R-S.C.) and in the House by Rep. Steve King (R-Iowa). 

TEA would amend the National Labor Relations Act to protect the employer from being required to hire any person who is seeking a job in order to promote interests unrelated to those of the employer.  “Small businesses should never be forced to hire undercover union organizers who seek to bully workers and harm companies,” said Senator DeMint. “We must pass the Truth in Employment Act or successful small businesses will remain vulnerable to union salting tactics that threaten jobs."  Click here to read Senator DeMint's press release on TEA

Does TEA have a realistic chance of becoming law?  Not really.  The Republicans unsuccessfully tried to pass TEA in 2005 and 2007, and that was when they had a fellow Rebpublican in the White House and much better numbers in both houses.  Expect this one to die on the vine. 

Employers can take some solace, however; last year, the National Labor Relations Board held in Toering Electric Company  that an employer is not required to hire an employee who is not "genuinely interested in seeking to establish an employment relationship with the employer," thus significantly restricting the amount of salt in unions' diets.  If you have concerns about union salting in your workplace, you might want to read the NLRB's Guideline Memorandum Concerning Toering Electric Company

Proposed Law Would Allow Employers to Pay Extra to Union Workers

The proposed Rewarding Achievement and Incentivizing Successful Employees (RAISE) Act, introduced in Congress last week, would change federal labor law to allow employers to pay higher wages to selected union employees.  Sounds like a no brainer, right?  Guess again.

The Act was introduced in the Senate by Sen. David Vitter (R-La.) and in the House by Rep. Tom McClintock (R-Calif.)  Under the RAISE Act, collective-bargaining agreements would establish a "floor" for wages, a minimum standard that employees could then exceed for "those workers who go the extra mile."   Under current law, an employer must first bargain with the union and obtain the union's agreement before rewarding individual achievement.  Click here for an explanation of the RAISE Act from conservative think tank the Heritage Foundation

Who would oppose such a law?  Unions.  Unions are adamantly opposed to allowing employers the discretion to reward individual efforts (one could accurately state that unions oppose allowing employers any discretion whatsoever, but that's a topic for a different post).  Expect the unions to quietly put pressure on the Democratic majority to kill this bill.  In our humble opinion, the RAISE Act  is primarily an attempt by Congressional Republicans to bait unions into embarrassing themselves by opposing a bill that aims to give their own members higher pay.  Undoubtedly, this will also play into the Republicans' strategy of opposing the Employee Free Choice Act.  But, given the current Democratic majority in Congress, don't expect RAISE to fly. 

Labor Groups Hail Sotomayor Nomination

Judging from organized labor's reaction, Judge Sotomayor may be a pro-labor justice if her appointment is confirmed by the Senate.  "Judge Sotomayor is a sound, progressive judge who is blessed with a brilliant legal mind," said United Steelworkers President Leo W. Gerard.  Praising her nomination, AFL-CIO President John Sweeney says Sotomayor possesses a “direct and personal understanding of the struggles America’s workers endure every day.” She's also received these glowing recommendations from the SEIU, Change to Win and the Labor Council for Latin American Advancement, just to name a few.

Labor's love affair with Judge Sotomayor goes back to 1995, when she issued the injunction that effectively ended the 1994-95 baseball strike.  (In announcing her nomination, President Obama was quick to point that she singlehandedly saved the American Pastime.) 

While organized labor falls all over themselves to praise Judge Sotomayor, employers' groups are taking a more cautious approach.  The U.S. Chamber of Commerce, known to butt heads with unions over many issues (notably the Employee Free Choice Act), is still weighing whether to endorse Sotomayor.  While we don't necessarily see anything in her background to make us nervous, such a warm reception from labor unions certainly should raise an eyebrow or two. 

Meanwhile, for those who are interested, here's a clip of Judge Sotomayor speaking about her nomination:

EFCA Update: Arlen Specter and "Quickie Elections"

The latest news on the Employee Free Choice Act (EFCA) is a possible compromise in which EFCA's card-check provision is replaced by a "quickie election" procedure - where an election must be held a very short time (a week to three weeks) after the union requests one from the National Labor Relations Board (NLRB).  Another possible compromise provision would be to allow unions equal time with employees if employers choose to hold "captive audience" meetings with employees during a campaign.  Both proposals would allow for elections in place of the proposed card check provision, but would sharply curtail employers' ability to express their views to their employees.  To learn more, read this article from the Washington Post

Recently converted Democratic Senator Arlen Specter continues to hold the EFCA spotlight:  according to this article in the Pittsburgh Post-Gazette, there is speculation afoot of a deal between Senator Specter and the AFL-CIO and  in which Senator Specter would support EFCA in exchange for labor's full backing the 2010 Senate race.  If Specter changes his position and backs EFCA, it might pass without substantial amendments. 

To read more about EFCA, check out the Stoel Rives World of Employment's EFCA Coverage

President Obama Announces NLRB Nominations

Last Friday, President Obama announced his intention to nominate Craig Becker and Mark Pearce as Members to the National Labor Relations Board (NLRB), the government agency that administers the National Labor Relations Act, the primary law governing relations between unions and employers in the private sector.  Click Here to read the White House Press release

Normally the Board has five members, three from the President's party and two from the other, but right now the Board has only two members, one Democrat and one Republican.  Both of these nominees are Democrats, meaning the next will be a Republican.  Here's what the White House has to say about each:

  • Craig Becker currently serves as Associate General Counsel to both the Service Employees International Union and the American Federation of Labor & Congress of Industrial Organizations. He graduated summa cum laude from Yale College in 1978 and received his J.D. in 1981 from Yale Law School where he was an Editor of the Yale Law Journal. After law school he clerked for the Honorable Donald P. Lay, Chief Judge of the United States Court of Appeals for the Eighth Circuit. For the past 27 years, he has practiced and taught labor law. He was a Professor of Law at the UCLA School of Law between 1989 and 1994 and has also taught at the University of Chicago and Georgetown Law Schools. He has published numerous articles on labor and employment law in scholarly journals, including the Harvard Law Review and Chicago Law Review, and has argued labor and employment cases in virtually every federal court of appeals and before the United States Supreme Court.
  • Mark Gaston Pearce has been a labor lawyer for his entire career. He is one of the founding partners of the Buffalo, New York law firm of Creighton, Pearce, Johnsen & Giroux where he practices union side labor and employment law before state and federal courts and agencies including the N.Y.S. Public Employment Relations Board, Equal Employment Opportunity Commission, the U.S. Department of Labor, and the National Labor Relations Board. Pearce in 2008 was appointed by the NYS Governor to serve as a Board Member on the New York State Industrial Board of Appeals, an independent quasi-judicial agency responsible for review of certain rulings and compliance orders of the NYS Department of Labor in matters including wage and hour law. Pearce has taught several courses in the labor studies program at Cornell University’s School of Industrial Labor Relations Extension. He is a Fellow in the College of Labor and Employment Lawyers. Prior to 2002, Pearce practiced union side labor law and employment law at Lipsitz, Green, Fahringer, Roll, Salisbury & Cambria LLP. From 1979 to 1994, he was an attorney and District Trial Specialist for the NLRB in Buffalo, NY. Pearce received his J.D. from State University of New York, and his B.A. from Cornell University.

If affirmed by the Senate, these appointments, along with NLRB Chair Wilma Liebman, will give the NLRB a solid pro-labor majority for the next four years.  Regardless of what happens with the Employee Free Choice Act, you can safely expect major changes in labor law, as the Obama Board likely charts a much different course than the Board did during the Bush years. 

Costco, Whole Foods and Starbucks Offer Olive Branch on EFCA

According to the Washington Post, executives from three progressive employers, Costco, Whole Foods and Starbucks, have offered a compromise of sorts on the Employee Free Choice Act (EFCA).  Their proposed compromise would drop the card-check and mandatory arbitration provisions of the act, but give unions greater access to employees and guarantee union elections within a specific time period.  Click here to read the Post's article on the proposal

The compromise would remove from EFCA the two provisions that give employers the most heartburn:  a provision that would allow employees to form a union without a secret-ballot election if a majority sign pro-union cards, and one that would impose binding arbitration if employers and unions fail to reach a contract after 120 days.  However, the compromise would keep EFCA's increased penalties for companies that retaliate against workers before union elections or refuse to engage in collective bargaining, would set a fixed period in which an election must be held, limiting the delays that give employers time to campaign, and would provide unions equal access to workers before elections -- for instance, by allowing organizers to address workers on a lunch break on company premises.

Don't expect either side to jump on the bandwagon soon.  Unions are committed to the card-check and arbitration provisions, and anti-EFCA forces will not favor giving unions on-site access to employees anytime soon.  But, as the EFCA fight goes on, creative proposals like this one might be what is needed to break a Senate filibuster.  Keep watching the Stoel Rives World of Employment for more EFCA news and updates. 

Let the Fireworks Begin! EFCA Introduced in Congress

The Employee Free Choice Act (EFCA), which will amend the National Labor Relations Act to make it easier for unions to organize, was introduced in Congress yesterday.  Separaste bills were introduced by Sen. Tom Harkin (D-Iowa), member of the Senate Health, Education, Labor and Pensions Committee, and Rep. George Miller (D-Calif.), chairman of the House Education and Labor Committee.  Want to know more about EFCA?  Check out our continuing coverage here at the Stoel Rives World of Employment.

Pro-EFCA forces are gathering.  The SEIU has put out this fancy new ad for your viewing pleasure (seriously, we got a big kick out of this one!  Some say this is over the top, but we respect that.)

President Obama Signs Executive Order Allowing PLAs on Federal Projects

President Obama recently signed his fourth labor-friendly executive order, this time allowing the federal government to require project labor agreements (PLAs) on large-scale federal construction projects.  This order overturns a prior order from President Bush disallowing PLAs.  Click here to read the text of the order.  This latest action follows Obama’s three executive orders earlier this month that reversed a trio of Bush-era orders governing the way federal contractors deal with union workers.

A PLA is defined as "a pre-hire collective bargaining agreement with one or more labor organizations that establishes the terms and conditions of employment for a specific construction project."  PLAs are relatively common in the construction industry.  Unions tend to like project labor agreements as they streamline the bargaining process and generally set high wages and benefits, making it easier for union contractors who pay those higher wages and benefits to get the work. 

Not surprisingly, union officials are very happy about the latest order.  You can bet non-union builders and contractors aren't as happy.  Click here to read the Associated Builders and Contractors' position on PLAs

Carpenters Union to Pay Oregon Employer $450,000 to Settle Picketing Dispute

The Pacific Northwest Regional Council of the Carpenters and Joiners of America recently agreed to pay Hoffman Construction Co. $450,000 and to settle a lawsuit over alleged unlawful picketing during a 2007 strike in Oregon.  The Carpenters have also agreed to pay an additional $200,000 into an escrow account until the union has trained its members on diversity, race and sex discrimination, intimidation, and picket line behavior.  Click here to read the consent decree

A union paying an employer?  You read that correctly.  Hoffman alleged that Carpenters members engaged in unlawful picketing with mass picketing and improper signage, intimidated workers, disrupted traffic, struck vehicles, picketed reserved gates, made excessive noise, and caused physical damage.  Hoffman also alleged that picketers used derogatory racial and sexist epithets, obscenities and threatening language aimed at replacement workers and union members crossing picket lines. 

This is an important decision for employers.  While lawsuits against unions for picket line misconduct are fairly common, a decisive outcome like this is very rare.  This sets a precedent that such picket line behavior is not acceptable, and may encourage unions to better control picketers.

President Obama Nominates Wilma Liebman to Chair NLRB

Late last month, President Obama appointed Wilma B. Liebman to chair the National Labor Relations Board (NLRB), the agency that enforces federal labor law.  Click here to read the NLRB's press release on the appointment.  Chairman Liebman has served on the Board since November 14, 1997.  First appointed by President Clinton, she is now serving her third term, which will expire on August 27, 2011. 

Chairman Liebman is considered one of its most union-friendly members, and was often a strongly dissenting voice on the Board during the eight years of the Bush administration.  Her appointment was not unexpected, and confirms predictions that the NLRB would shift to the left during the Obama administration. 

Don't think the Board will change under Liebman's watch?  Watch her testify before congress regarding some controversial decisions under the Bush Board, and perhaps you will change your mind:

 

WSJ Reports EFCA Unlikely to Pass Soon

According to yesterday's Wall Street Journal, the Employee Free Choice Act (EFCA) is not likely to become law in the first 100 days of the Obama Administration.  Because Republicans are threatening a filibuster, congressional Democrats are likely to instead focus their early efforts on two other low-hanging fruit:  the Lilly Ledbetter Fair Pay Act, which would extend the statute of limitations under civil-rights laws for bringing suits against employers over pay; and the Paycheck Fairness Act, which would strengthen remedies under the Equal Pay Act of 1963 for women.

If passed, EFCA would be the most wide-ranging revision to federal labor law in 50 years. It would, among other things, require employers to recognize a union as the exclusive bargaining agent for its employees based solely on a "card check" process rather than a secret ballot election. It is expected to drastically increase union organizing and unionization rates. 

Threats of a Senate filibuster and a presidential veto prevented EFCA's passage in 2008, but the labor movement and congressional Democrats hoped that a filibuster-proof majority in the Senate would allow its passage in 2009.  We're not ready to write EFCA off just yet - what remains to be seen is if a compromise version will sufficiently appease the act's proponents while weakening opposition.  Stay tuned to the Stoel Rives World of Employment for more updates.

The Employee Free Choice Act: Maybe Not a Done Deal?

As reported earlier in the Stoel Rives World of Employment, the Employee Free Choice Act (EFCA) will be a high priority for Congress and President-Elect Obama in 2009.  The EFCA would be the most wide-ranging revision to federal labor law in 50 years. It would, among other things, require employers to recognize a union as the exclusive bargaining agent for its employees based solely on a "card check" process rather than a secret ballot election. If passed, it is expected to drastically increase union organizing and unionization rates.

Two things prevented EFCA from passing into law back in in 2007 - an almost certain veto from President Bush, plus opposition from the Republican minority in the United States Senate.  51 Senators voted for cloture on EFCA - 50 Democrats (all except one who was absent) plus Pennsylvania's Arlen Specter; however, 60 votes are needed to end debate and bring the bill to a vote.  Now that the Democrats appear on the cusp of controlling 59 Senate seats, assuming Arlen Specter maintains his support for EFCA, there's nothing to stop the bill from passing, right?

Not so fast, warns FiveThirtyEight.com's Nate Silver.  Arkansas Democrat Blanche Lincoln has now indicated that she's not so keen on EFCA and might vote no.  Her no vote would leave the Democrats one vote short of stopping a Republican filibuster.  Click here to read the rest of Nate Silver's fascinating analysis of EFCA in the Senate.  And don't forget to keep following the Stoel Rives World of Employment for more EFCA updates. 

Supreme Court Rejects Appeal on Aliens' Right to Vote in Union Elections

Earlier this month, the United States Supreme Court declined to review a ruling from the Court of Appeals for the District of Columbia Circuit holding that unauthorized aliens are "employees" under the National Labor Relations Act (NLRA) and therefore entitled to cast votes in a union election. 

In Agri Processor Co. v. NLRB, the employees elected the United Food and Commercial Workers Union Local 342 as their bargaining agent in 2005 election; however, the employer refused to bargain with the union on the basis that 17 of the 21 employees who cast ballots were not legally authorized to work in the United States, and therefore not "employees" under the NLRA. 

In a 2-1 decision that was affirmed by the D.C. Circuit, the National Labor Relations Board held that the certification of Local 342 was valid because the voters were employees under the NLRA even if they were hired in violation of the Immigration Reform and Control Act.  That decision will stand now that the Supreme Court has passed on its opportunity to review the case.  With the passage of the Employee Free Choice Act appearing all but certain, authorization cards signed by unauthorized alien employees will likely be held valid as well. 

NLRB 2008 Report Shows Efficient, Aggressive Enforcement of Labor Law

Ronald Meisburg, General Counsel for the National Labor Relations Board (NLRB) issued his annual Summary of Operations memo on October 29, 2008.  (The NLRB is the federal agency that enforces our country's labor laws and conducts union elections.)  Mr. Meisburg's memo is full of interesting news and developments on all facets of the NLRB's operations.  To read the complete memo, click here.  If you want the Cliff's Notes version, here you go:

  • Case intake is up: ULP cases are up 1.6%, from 22,147 in FY 2007 to 22,501 in FY 2008.   New representation cases are up 2.3% from 3,324 to 3,400. 
  • Elections are being held sooner:  the NLRB closed 83.5% of all representation cases within 100 days, exceeding its target of 80%.  93% of all initial union representation elections were conducted within 56 days of the filing of the petition, with a median of 39 days from filing.
  • ULPs are being investigated faster:  The Board closed 68.1 percent of all ULP cases within 120 days, meeting its target of 68%, and closed 75.2% of meritorious ULP cases within 365 days, meeting its target of 75%.
  • The NLRB is winning a lot:  Its Regional Offices won 90.8% of Board and Administrative Law Judge unfair labor practice decisions in whole or in part in FY 2008 (up 5% from 2007), and it recovered a total of $70,001,594 on behalf of employees as backpay or reimbursement of fees, dues, and fines.  It obtained reinstatement for 1,564 terminated employees.
  • The NLRB is using injunctions.  The Board authorized a total of 28 Section 10(j) injunction cases in FY 2008, as compared to 25  in FY 2007. The “success rate” (the percentage of 10(j) cases in which the NLRB achieved either a satisfactory settlement or substantial victory in litigation) was 84%.
  • The NLRB is more efficient:  It met all three of its primary goals, closing 83.50% of all
    representation cases within 100 days (target 80%), 68.10% of all unfair labor practice cases within 120 days (target 68%), and 75.22% of all meritorious unfair labor practice cases within 365 days (target 75%). 

What does this mean for employers?  The NLRB is more efficient and pushing cases to resolve more quickly, which may give employers less time to respond to petitions for election.  Also, the Board continues to be more aggressive in litigation and in seeking injunctions, which is rarely good news for employers.  In short, don't take the NLRB lightly. 

U.S. Supreme Court to Hear Six L&E Cases This Term

The U.S. Supreme Court opened its 2008-2009 term on October 6 with six labor and employment law cases on its docket.  (For docket information and questions presented, click on the name of the case). 

  • Locke v. Karass:  may a public employee union may charge nonmembers for representational costs for litigation expenses incurred by the international union on behalf of other bargaining units?
  • Kennedy v. Plan Administrator for DuPont Savings & Investment Plan:  is a qualified domestic relations order (QDRO) is the only valid way under ERISA for a divorcing spouse to waive his or her right to the other spouse's pension benefits?
  • Crawford v. Metro. Gov't of Nashville & Davidson County:  Is an employee who cooperates with an employer-initiated investigation into alleged unlawful discrimination protected by Title VII's anti-retaliation provisions? 
  • Ysursa v. Pocatello Education Ass'n:  does an Idaho law that prohibits local government employers from allowing employee payroll deductions for political activities violate the First Amendment free speech rights of unions and their members?
  • 14 Penn Plaza LLC v. Pyett:  do employees covered by a collective bargaining agreement which providies that statutory employment discrimination claims must be pursued through the contractual grievance and arbitration procedures have a right for a court to decide their discrimination claims?
  • AT&T Corp. v. Hulteen:  must an employer give full service credit for purposes of calculating retirement benefits for pregnancy leaves taken before the Pregnancy Discrimination Act of 1978 if the plan gave full credit for other types of temporary disability leaves? 

Some of these cases (such as the Penn Plaza and Crawford cases) have the potential to make significant changes in existing law.  Stay tuned to the Stoel Rives World of Employment for developments as they occur!

"Permanent" Strike Replacements Can Be Employed At Will

Earlier this week, the Seventh Circuit Court of Appeals ruled  that an employer does not violate the National Labor Relations Act by refusing to reinstate economic strikers because it had hired permanent replacements, even though those "permanent" workers are at-will employees.   The decision in United Steelworkers v. NLRB upheld an earlier National Labor Relations Board ruling, also in favor of the employer. 

The court upheld the NLRB's ruling board permissibly held that employer and the replacement employees had a "mutual understanding" that, despite an at-will clause in the replacements' employment applications, their employment was, for purposes of replacing the strikers, "permanent."  The Court agreed with the NLRB that an at-will employment clause in the striker replacements' job applications did not make them "temporary" replacements who normally must be terminated in favor of returning strikers. 

This ruling gives employers greater flexibility in hiring permanent replacement workers in the event of a strike.  Nevertheless, whether an employer may "permanently" replace strikers in a particular strike is a very complex legal issue.  In any strike situation, employers need to be very careful about whether to hire "permanent" or "temporary" replacement workers, and to only permanently replace strikers if they are legally entitled to do so.  And in any event, employers may not ever replace a striking Tina Fey, because she's too funny

Union Liable for Improperly Accessing Drivers' Licence Records

Earlier this week, the U.S. Court of Appeals for the Third Circuit held labor union UNITE HERE liable under the federal Driver's Privacy Protection Act (DPPA) for accessing the motor vehicle records of Cintas Corp. employees to find their home addresses.  The decision is available here:  Pichler v. UNITE

As part of a 2002 organizing drive, union organizers recorded the license plate numbers on employees' cars in Cintas parking lots, then sought the names and addresses of the vehicle owners, using an online database, private investigators, or information brokers.  Cintas employees sued the union as part of a class action alleging that the union's activities violated the DPPA, and the Third Circuit agreed. 

The court rejected the union's argument that its activity was allowed under DPPA exceptions for "activity related to litigation or law enforcement," stating that the union attempted to conceal its "clear labor-organizing purpose" for obtaining the vehicle records.  The court also held that the union could be liable for punitive damages.

This decision may have far-reaching implications for unions and their conduct of organizing campaigns.  Unions will often go to great lengths to obtain employees' home addresses so that union organizers can make home visits to employees (usually during prime time television) for the purposes of obtaining signatures on authorization cards or petitions.  This decision takes away one common means of obtaining such information. 

Ninth Circuit Overturns NLRB in Dues Checkoff Case

Earlier this week, the Ninth Circuit Court of Appeals overturned for the second time a decision by the National Labor Relations Board, and held that two Las Vegas casinos violated the National Labor Relations Act by unilaterally terminating dues checkoff without first bargaining with the union over that decision.   Local Joint Executive Bd v. NLRB (9th Cir 08/27/2008).  

The employer argued that the parties' collective bargaining agreement allowed it to end dues checkoff at the expiration of the agreement and the NLRB agreed; the Ninth Circuit, however, held that the contract language does not show a "clear and unmistakable waiver" of the unions' right to bargain over ending dues checkoff.  This was the second time this case was before the Ninth Circuit - the first time, the court remanded the case to the NLRB to "articulate a reasoned explanation" for its conclusion that dues-checkoff disputes should be excluded from the "unilateral change doctrine" recognized in NLRB v. Katz, 369 US 736 (1962). 

The lesson for union employers:  remember your obligation to bargain with the union in good faith before making any unilateral change to the terms and conditions of employment, unless there the union has clearly and unmistakenly waived its right to bargain over that change.  Unilateral changes might get a pass from the current NLRB, but they are unlikely to be tolerated by the appellate courts. 
 

NLRB Issues New Guidelines on Employee Political Activity

You have an employee who is using the breakroom as his bully pulpit, discussing his political views with his coworkers.  Some coworkers complain to you that they don't want to hear it, so you call the employee in to your office and tell him to keep his views and opinions to himself.  A no-brainer, right?  Not so simple, according to new guidelines from the National Labor Relations Board on employee's political activities in the workplace.

According to the new guidelines, employee political speech that touches on employment issues may be protected by Section 7 of the National Labor Relations Act.  In essence, if there is a direct nexus between employment-related concerns and the specific issues that are the subject of the political speech, then the speech is protected.  Of course, you can still counsel the employee to confine his activities to appropriate places and times, if it is interfering with work. 

So, the employee's views on why the U.S. should pull out of the U.N.?  Why industrial hemp should be legalized?  Probably not protected speech.  The employee's views on the minimum wage, or the expansion of medical marijuana laws to require workplace accommodation?  Probably both protected under the NLRA. 

AFTRA Ratifies Three-Year Contract

Good news for us consumers of entertainment:  members of the American Federation of Television and Radio Artists just ratified a new three-year prime-time television agreement with major Hollywood studios and networks.  AFTRA represents about 70,000 radio and television performers.  Negotiations between the studios and the Screen Actors Guild, however, continue, threatening the continued production of such fine fare as Lipstick Jungle.  Which might also be good news.  

Big Day at the Supreme Court: Four New L&E Decisions

Today the U.S. Supreme Court issued four labor and employment-related decisions; none, however, were big surprises or substantial changes in the law.

 First, in Meacham v. Knolls Atomic Power Laboratory, the Court held 8-0 that an employer defending an Age Discrimination in Employment Act case bears the burden of proving a "reasonable factors other than age" or "RFOA" affirmative defense.  Truth be told, most defense lawyers have assumed that it was the employer's burden to prove the affirmative defense; this decision simply confirms that assumption.  Continue Reading...

Nurses Button Up: Ninth Circuit Nurses May Wear Union Buttons at Work

The Ninth Circuit Court of Appeals recently ruled that a Spokane hospital could not lawfully prohibit nurses from wearing union buttons in areas where they only "might" encounter patients or family members. Health care employers should review their uniform policies to make sure union insignia and other political buttons and stickers are only prohibited in patient care areas and not in other nonpatient areas (such as kitchens, break rooms and hallways), even if employees might casually encounter patients there.