United States: Current NLRB Signals Upcoming Changes To Labor Law

Last Updated: December 18 2017
Article by Eric W. Ruden

Three recent steps by the National Labor Relations Board (NLRB) signal there will be major changes to its application of the National Labor Relations Act (the "Act") during the Trump administration. A General Counsel memorandum issued on December 1, 2017 (detailing potential changes to existing law); a request for comments issued on December 13, 2017 (on whether to modify or eliminate the "quickie" union election rules that were published in 2014); and a decision issued on December 11, 2017 (overturning a 2016 decision) all suggest a significantly different approach by the current NLRB. 

General Counsel Memorandum

On December 1, 2017, the new General Counsel of the NLRB, Peter Robb, issued a memorandum to the NLRB's Regional Directors detailing existing Board law that may change under the current NLRB. The memorandum additionally rescinded six General Counsel memoranda issued during the Obama administration and ends several Board initiatives.

The memorandum directs cases involving significant legal issues to be submitted to the General Counsel for advice. Significant legal issues include cases over the last eight years that overruled precedent and involved one or more dissents, cases involving issues that the Board has not decided, and any other cases that the Region believes will be of importance to the General Counsel.

The most significant prior General Counsel memoranda rescinded by the new General Counsel memorandum concerns employer rules. In this rescinded memorandum, the prior General Counsel detailed workplace rules the Board had found lawful and unlawful under the Act, including certain rules regarding confidentiality; employee conduct toward the company and supervisors; employee conduct toward fellow employees; employee interaction with third parties such as the news media and government agencies; restrictions regarding the use of company logos and copyrights; restrictions on workplace photography and recording; conflict of interest policies; and social media policies. Common workplace rules such as "never publish or disclose the employer's or another's confidential or other proprietary information," "be respectful of others and the Company," and "do not make insulting, embarrassing, hurtful or abusive comments about other company employees online" were deemed to be unlawful. Importantly, the NLRB's restrictions on workplace rules apply to all employers, union and non-union alike.

Many of the landmark NLRB holdings during the Obama administration are listed in the memorandum as decisions, which might be subject to an "alternative analysis" under the current NLRB. These include: 

  • Employees have a presumptive right to use their employer's email system to engage in Section 7 activities (Purple Communications, 361 NLRB No. 126 (2014))
  • Joint employer status may be based on evidence of indirect or potential control over the working conditions of another employer's employees (Browning-Ferris Industries of California, Inc., d/b/a BFI Newby Island Recyclery, 362 NLRB No. 186 (2015))
  • No loss of protection under the Act when employee engages in obscene, vulgar, or other highly inappropriate contact (Pier Sixty, LLC, 362 NLRB No. 59 (2015))
  • Declaration of a new, more employee-friendly standard for when an employer is obligated to disclose witness statements during an internal investigation (Piedmont Gardens, 362 NLRB No. 139 (2015))
  • Company rule prohibiting recording workplace conversations is unlawful (Whole Foods Market, 363 NLRB No. 87 (2015))
  • Blanket rule prohibiting employees from discussing ongoing internal investigations is unlawful (Banner Estrella Medical Center, 362 NLRB No. 137 (2015))

Board Requests Public Comments Regarding Whether to Change or Rescind Quickie Election Rules

On December 13, 2017, the NLRB published a request for information in the Federal Register asking for public comments regarding the Board's 2014 modifications to its union election procedures, commonly known as the "quickie" election rules. In its request, the NLRB seeks information asking: (1) should the 2014 election rule be retained without change; (2) should the 2014 election rule be retained with modifications, and if not, what should be modified; and (3) should the 2014 election rule be rescinded, and if so, should the Board revert back to the representation election rules in effect prior to 2014, or make changes to the prior representation election rules. The Board will consider responses until February 12, 2018.

In 2014, the Board made significant changes to its union election procedures, in an effort to speed up the time between when a petition for an election is filed and the election is held to as few as 11 days. These changes included the following:

  • Pre-election hearing set eight days after hearing notice is served and post-election hearing 21 days after the tally of ballots
  • Except in unusual cases, the litigation of voter eligibility and inclusion issues will be deferred to the post-election stage
  • Elimination of the 25-day waiting period between a Regional Director's decision to direct an election and the holding of the election
  • Requirement that parties identify any issues with a petition for an election prior to a pre-election hearing
  • Parties not afforded seven days to file written briefs following closing of pre-election hearing unless the Regional Director determines they are necessary
  • Employer required to provide a list of prospective voters with their job classifications, shifts and work locations to the NLRB and the union one day before pre-election hearing
  • Employers must provide the union with employee phone numbers and email addresses, if they have them, in addition to employee mailing addresses

Employers largely opposed the 2014 modifications for a variety of reasons, including the shorter time period an employer would have to educate its employees about unionization due to the shorter time from petition to election. The rule changes had their intended effect as the median number of days from a petition to an election was reduced from 38 days to 23 days. While the number of petitions filed under the modified rules did not significantly increase, as had been expected, the percentage of representation elections won by unions did slightly increase.

Current Board Issues First Decision Overturning Obama-Era Board Reversal of Precedent

On December 11, 2017, the NLRB issued a decision in UPMC, 365 NLRB No. 153 (2017) overturning its decision issued last year, United States Postal Service, 364 NLRB No. 116 (2016), which prohibited an administrative law judge from accepting a respondent's offered settlement terms over the objection of the General Counsel and charging party unless the offer constitutes a "full remedy" for all of the violations alleged in the complaint. In UPMC, the Board returned to its prior practice of analyzing all settlement agreements, including consent settlement agreements, under a reasonableness standard.

The Board initially summarized its reasonableness standard detailed in Independent Stave, 287 NLRB 740 (1987). In that case, the Board held that in evaluating settlements, the Board will examine all the surrounding circumstances, including, but not limited to: "(1) whether the charging party(ies), the respondent(s), and any of the individual discriminate(s) have agreed to be bound, and the position of the General Counsel regarding the settlement; (2) whether the settlement is reasonable in light of the nature of the violations alleged, the risks inherent in litigation, and the stage of the litigation; (3) whether there has been any fraud, coercion, or duress by any of the parties in reaching the settlement; and (4) whether the respondent has engaged in a history of violations of the Act or has breached previous settlement agreements resolving unfair labor practices disputes."

In overturning Postal Service and returning to the reasonableness standard of Independent Stave, the Board stated its decision in Postal Service was an "ill-advised deviation" from longstanding precedent and adopted an "ill-advised standard" less likely to effectuate the purposes and policies of the Act. The Board additionally stated Postal Service "improperly deviated" from policies favoring the appropriate settlement of disputed allegations. While the Board rejected the dissent's argument that the Board's change in composition was the basis for revisiting its decision in Postal Service, the Board acknowledged "'it is a fact of life in NLRB lore' that the Board's interpretation of the Act will 'invariably fluctuate with the changing compositions of the Board.'"

What This Means for Employers

The General Counsel memorandum can be viewed as a roadmap of what actions the current NLRB may take in the future, but it does not actually overturn any existing Board decisions. The memorandum instructs that cases should be processed and complaints issued according to existing Board law. Existing precedent cannot be overturned until a case is presented to the Board. Unless there is a case already pending before the Board or well along in the process, it can take years for the "right case" to come to the Board for decision. One of the intended effects of the memorandum may be to assist the General Counsel in finding such a case or to encourage employers to file appeals to the Board for the General Counsel to consider. As demonstrated by UPMC, the Board will not shy away from overturning recent cases, especially when such cases departed from longstanding Board precedent.

Employers that changed their policies due to changes in Board law during the Obama administration should carefully consider the risks of moving back to their old rules too quickly with the expectation that the new Board will return to prior interpretations of the law. While it is very likely the current Board will reverse the previous Board's decisions in at least some of the identified areas, some decisions may remain in place. In addition, Regional Directors and administrative law judges will continue to apply the existing law until the Board actually issues new decisions. Consequently, an employer that wishes to make changes contrary to current law needs to be ready to invest time and money in a legal battle at this early stage.

Employers may experience an increase in union organizing, at least in the short term. With the strong possibility that at least some of the Board's election rules will change, it is possible that some unions will preemptively file election petitions over the next couple of months with the expectation that the current rules are more union-friendly than they will be after any modifications.

We will continue to monitor Board developments as they occur and update you of future changes.

For Further Information

If you have any questions about this Alert, please contact any of the attorneys in our Employment, Labor, Benefits and Immigration Practice Group or the attorney in the firm with whom you are regularly in contact.

Disclaimer: This Alert has been prepared and published for informational purposes only and is not offered, nor should be construed, as legal advice. For more information, please see the firm's full disclaimer.

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