Labor Relations Insight by Phil Wilson

Is the PRO Act a Mate in One?

This week the NLRB issued its highly anticipated rulemaking on joint employer, overruling the controversial Browning Ferris decision. If you haven’t read through the 53-page final rule (and why would you – that’s what you’ve got me for) here are the highlights:

• A business is a joint employer of another employer’s employees only if the two employers share or codetermine the essential terms and conditions of employment (defined as wages, benefits, hours of work, hiring, discharge, discipline, supervision, and direction);
• To be a joint employer a business must possess and exercise substantial direct and immediate control over one or more essential terms and conditions of employment of another employer’s employees;
• Indirect and contractually reserved – but never exercised – control over essential terms and conditions (and control over mandatory subjects of bargaining that aren’t essential terms and conditions) may be used as evidence of joint-employer status but cannot by itself prove joint employer status.

This thoughtful rule is the next salvo in the years-long battle over defining who counts as an employer under our labor laws. It will certainly be litigated, and it sets up a number of potential showdowns with states, administrative law judges, and other agencies. But it is a critical development (along with the Department of Labor’s rule issued in January). It provides much more clarity, especially for franchisors and gig economy companies who faced having their entire business model destroyed.

Up till now the joint employer issue has bounced around in a series of agency and court decisions, which get reversed when a new administration comes into power. This political back-and-forth is extremely frustrating for employers and their employees alike. For example, numerous groups of freelancers and so-called gig workers are suing to block California’s AB-5 statute from going into effect. That’s why the Ring Board should be applauded for getting these rules through and clarifying this critical issue.

Here is the problem. It’s true that a rulemaking is more difficult to reverse than an agency decision. However, it is far from impossible, as the Ring Board recently showed by rewriting the “ambush election” rule originally put in place by the Obama-era Board. While the playing field has shifted somewhat away from decisions and toward rulemaking, the game is being played basically the same. Each time the administration changes they just flip everything back to the way it was before. Rinse, lather, repeat.

You’ve probably heard the saying that most people play checkers, but the most strategic ones play chess. In other words, checkers doesn’t require as much strategy or thinking ahead. You’re mostly just reacting to the last move of your opponent. When I think about the state of labor law today, I think both sides usually play checkers. Move, countermove.

However, Big Labor and their Democrat allies are playing chess when it comes to the PRO Act. Labor unions know they missed the best opportunity in a generation to revolutionize US labor law when the completely mis-named (but also cleverly named) Employee Free Choice Act nearly passed in 2009. They are now betting it all on the PRO Act, which has already passed the House. The PRO Act is literally every bad idea unions have come up with in the last 40 years to re-shape labor law in their favor. In addition to overturning the joint employer rulemaking, it includes card-check, gives unions access to company property, mandates arbitration of bargaining agreements and much, much more. This bill is going nowhere in 2020, but it has a significant chance of passing should the Presidency and US Senate flip in November.

The PRO Act or its key provisions are supported by every current Democratic candidate for the presidency. Big Labor has made clear that support for the PRO Act is a litmus test for their support in any political election. While hitting the trifecta may be a long shot, it is not impossible. We are in a completely different political environment. Sure, a Sanders presidency and a Senate flip is hard to imagine, but is it any less probable than a Trump presidency was 4 years ago? I don’t think so.

I love playing chess. If you’ve ever played (and even if you don’t know anything about chess) you probably know that a checkmate is the goal of the game – using a combination of your pieces to put the king in a position where it can’t move. A “mate in one” is where you can move one piece to deliver mate. To deliver a mate in one you have to position your pieces in a way that that last piece can deliver the crushing blow without being captured.

I look at the PRO Act this year as Big Labor and the Democrats moving their pieces around to prepare to deliver a mate in one. Gathering up the House co-sponsors (and going after those who oppose the legislation) and getting all the presidential candidates on board is the first step. Making clear that they learned the lessons of EFCA is another move. Unions have withheld full-throated support for Joe Biden in part because they felt the Obama administration fought for healthcare instead of EFCA.

The most important lesson employers should have learned from EFCA was how fast it went from bad idea that had no shot of passing to nearly becoming law. And with the Democrat presidential candidates debating on whether or not to get rid of the filibuster rule in the Senate (the only thing that prevented EFCA from passing in 2009) it is more likely than ever that a major piece of labor legislation could pass soon.

The only way to prevent a one move mate is to make sure you take away your opponent’s resources. You put obstacles in the way. You counter-attack. You move your king to safety. These are moves you have to make way in advance. Once the final attacker is in position it is too late to stop the mate – it’s inevitable. If the business community wants any hope of stopping the PRO Act then businesses must be making moves now. Right now I only see Big Labor making chess moves – the business community is still playing checkers.

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Union Bailout Update

The NLRB released several Advice Memoranda at the end of January, going back several years and addressing a range of topics. Due to the age of many of the memoranda, several of the issues addressed have since been outdated by further actions of the Board or the courts, but they still contain much useful insight into the reasoning of the Board. The detail is too much to list in this format, so if any of the following catch your eye, read the details here:

• Employer arbitration agreements must not prohibit filing of Board charges.
• Some blanket workplace investigation confidentiality rules are categorically lawful.
• Employers must maintain and disclose information responsive to certain union requests.
• Employer should have pre-disclosed to union its intent to sell certain portions of its business.
• Employer’s rule limiting employee involvement in Board of Directors election considered lawful, while rule limiting employee complaints to the Board of Directors was not.
• Employer violates NLRA by refusing to hire union members.
• Exhaustion of union remedies lawful, but perhaps should not be.
• Employers cannot deduct union dues without specific, express authorization.

One of the disadvantages of unionized workforces is the loss of flexibility. Another recent advice memo from the Board highlights a strategy for proposed language in collective bargaining agreements that may allow for more flexibility.

The Board split a few hairs on Argos USA, LLC, addressing confidentiality policies as a confirmation of the 2017 Boeing decision regarding handbook policies. In Argos, the Board clarified that a company could protect “confidential” information such as “earnings” and “employee information,” while defining those terms as company earnings and company staffing information - and not wage or contact information.

Argos also allowed restrictions on cell phone use, specifically when controlled for safety reasons, and upheld the barring of employee use of email systems for personal purposes.

Ten years after Oregon passed a state law banning employers from forcing employees to attend captive audience meetings, the NLRB has finally filed a complaint in U.S. District Court in Portland. Oregon Attorney General Ellen Rosenblum rebuffed a November letter from the Boards General Counsel asking for help in resolving the conflict.

A good lesson learned in the Boards recent ruling upholding an employer's denial to provide certain information requested by a union. In such cases, simply rejecting the request usually results in the filing of a unfair labor practice. However, by inquiring about the reasons for the request, the Board has shown that the union must have reasons beyond suspicion that the information might be relevant for the company to be compelled to comply.

As expected, the House passed the PROAct by a 224-193 vote early this month. An evolution of the Employee Free Choice Act (EFCA) that narrowly missed becoming law, the PROAct isn’t likely to gain traction in the Senate – at least not in 2020…

The White House has signaled its picks for the NLRB, reappointing Marvin Kaplan (R) and former board member Lauren McFarran (D) for new five-year terms. There is still a seat vacant for which no appointment has been suggested.

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Laboring Toward 2020

Biden’s support of the Trans Pacific Partnership (TPP) puts him at odds with Big Labor, while union support for Bernie Sanders is snowballing.  Although the international unions have been slow to pick a favorite, many local, regional and statewide unions are jumping on the Bernie bandwagon, and he has amassed more union backers than any other candidate. Warren has scared up a few endorsements, while Buttigieg is still a goose-egg in this particular race.

In push-back against non-representative endorsement, more than 1,200 members of the IBEW signed a letter blasting the IBEW national leadership for endorsing a candidate rather than allowing members to endorse their own favorites, and asking the union to retract its endorsement of Joe Biden. The signers of the letter prefer to endorse Sanders.

Meanwhile, the American Federation of Teachers is hedging its bets by encouraging involvement of its local membership in campaign work for either Biden, Warren or Sanders.

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Revisioning of Labor Law

The Clean Slate for Worker Power is the most recent liberal revisioning of labor law. This effort was spearheaded by former NLRB member Sharon Block and Harvard professor Benjamin Sachs, and hosted by Harvard Law School. If you’re up for some heavy reading, download their 132-page agenda.

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Healthcare

Did Chino Valley nurses make gains in their new contract? 

by Lori King 

On December 12 Chino Valley Medical Center nurses ratified their first union contract. Prior to the ratification, the hospital and nurses suffered through several months of contentious negotiations – requiring mediation, an informational picket in August, and a 3-day strike in October. In reports, the strike was due to the Nurses asking for a 3% pay raise and the employer offering 2.5%. Nurses said the hospital’s offer was not enough to address high turnover rates due to low market pay. 

A thirty-thousand foot view of this situation prompts some key questions. What did nurses really gain in bringing a union to represent them? What could the hospital have done differently to avoid this situation? 

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Tech + Media Unions

The staff at crowdfunding platform Kickstarter voted to join the Office and Professional Employees Union this month, making it one of the first tech companies to opt into a representative labor relationship.

Meanwhile, executives at Hearst Magazines sat down for the first time with the union organizing committee looking to gain representation for hundreds of Hearst employees across 24 brands. This is a significant shift in Hearst’s approach since learning of its employees’ intention to organize back in November.

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Sticky Fingers

Current charges or sentences of embezzling union officials:

• Nathan Lum – ILWU: $300,000
• Chandra Miller – IATSE: $5,000
• Chad Waldoch – SMART: $107,706
• Beverly Davis and Evelyn Smith – CWA: $135,000
• Keith Ludlum – UFCW: $200,000

http://nlpc.org/index.php?q=union-corruption-update