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

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

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

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

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.Continue Reading OSHA Issues Interim Final Rules on Whistleblower Protection Provisions Under ACA

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.”Continue Reading Obama NLRB Presents Employers With Several Lumps Of Coal

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.Continue Reading 11th Circuit Disagrees With NLRB And Finds Nurses Are “Supervisors” In Lakeland Health Care Decision

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.Continue Reading Recordkeeping: The Often Overlooked Element of FMLA Compliance

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.Continue Reading Where There Is At-Will, There Is A Way: NLRB Issues New Guidance On “At Will” Employment Policies