Trendspotting: Several Heaping Helpings Of NLRB Heavy Handedness: LRI INK

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Subject: Trendspotting: Several Heaping Helpings Of NLRB Heavy Handedness: LRI INK

January 25, 2024

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Trendspotting: Several Heaping Helpings Of NLRB Heavy Handedness

By Kimberly Ricci

The NLRB seems bound and determined to side against retail and food service chains – if there is even an inkling of union involvement – regarding operational decisions. This bias has been extending to courts, which have been siding with unions on intellectual property disputes involving company logos. Now, the NLRB is applying that template to physical property too.

As we see below, once a union has its foot in the door, all bets might be off for fair resolutions toward an employer.

Trader Joe's And Their Plentiful Woes

The NLRB has accused the grocery chain of closing a wine shop to halt a UFCW organizing campaign. In doing so, GC Jennifer Abruzzo labeled the move "unlawful retaliation" and demanded that the grocer reopen the store and "make the affected employees' whole" for lost wages. Will an administrative law judge agree?

Meanwhile, an NLRB regional director gave the green light to a union victory despite Trader Joe's filing complaints of harassment against workers by union representatives during the organizing campaign. The Louisville, KY, store is the company's fourth unionized location.

Last year's dispute over the unauthorized use of a company logo on union merch has been "resolved," and it didn't go Trader Joe's way. A U.S. district judge dismissed the company's claims of infringement, calling the lawsuit' dangerously close to being frivolous.

Starbucks And The Cups Of Closure

The NLRB already had knives out against the coffeehouse giant, and in late 2023, the board accused the company of illegally closing 23 stores to halt unionizing. For their part, Starbucks maintains that these closures occurred in areas of high crime and to preserve worker safety. Additionally, the New York Times recently noted the company's annual practice of "evaluat[ing] the store portfolio," which led to launching "hundreds of new stores" in 2022 while closing 100. The matter now sits in the hands of an administrative law judge, so stay tuned for an update.

In a recent Board decision, Starbucks' firing of a Washington state barista and organizer of a three-day strike was ruled illegal by an administrative law judge.

Previously, a shareholder-mandated independent assessment dispelled reports of an "anti-union playbook" at Starbucks. However, it's fair to assume that, in the eyes of the NLRB, the real damage was done by ex-CEO Howard Schultz's combative rhetoric, which left a lasting mess for CEO Laxman Narasimhan.

Chipotle Felt The Heat Even Earlier

In mid-2022, the NLRB accused the burrito chain of closing a store over an organizing campaign. Chipotle denied these allegations but agreed to pay $240,000 to approximately two dozen workers who had lost their jobs.

Why did Chipotle fold? That's easy: the cost of litigating would have been far more than the settlement agreement.

Further Food For Thought

Even if the NLRB can successfully prove that a company did close down locations due to union organizing, the logistics involved with forcing stores to reopen creates another set of nightmares on both sides. At this point, we will have to wait and see whether any of these cases get that far, but clearly, warding off union involvement beforehand would be preferable to ending up at the whim of the NLRB.

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2023 BLS Union Membership Report: A Closer Look

By Michael VanDervort

Introduction: The Bureau of Labor Statistics' 2023 report on union membership has just been released, and it’s a treasure trove of insights. We're diving deep into the numbers to uncover the real story behind the union trends in the contemporary workforce.

Union Membership Declines Slightly Overall: Despite what many viewed as a banner year for organized labor, union membership in 2023 stands firm at 10.0%, encompassing 14.4 million workers, down from 10.1% in 2022. Even though the media claimed more workers want unions and referred to 2023 as the year of the strike, the data in the BLS report shows a record-low overall union density rate. For example, only 6% of private sector employees belong to a union, virtually unchanged despite all the labor union activity in 2023.

Public vs. Private Sector: A Tale of Two Workforces: A stark divide exists between the public sector (32.5%) and private sector (6.0%) regarding union density. The number of union workers employed in the private sector increased by 191,000 to 7.4 million in 2023, while the unionization rate was unchanged at 6.0 percent. Education, training, libraries, and protective services show the highest unionization rates – all public sector monopolies.

Industries with high unionization rates included utilities (19.9%), transportation and warehousing (15.9%), educational services (12.9%), and motion picture and sound recording industries (12.1%). Low unionization rates occurred in finance (1.2%), professional and technical services (1.3%), food services and drinking places (1.4%), and insurance (1.5%).

A Demographic Snapshot: Union membership is more prevalent among men, black workers, and older employees. Men continued to have a higher union membership rate (10.5%) than women (9.5%).

By age, workers ages 45 to 54 had the highest union membership rate in 2023, at 12.6 percent. Younger workers—those ages 16 to 24—had the lowest union membership rate, at 4.4 percent, despite media reports claiming that GenZ vastly supports unions. In 2023, the union membership rate for full-time workers (10.9%) was more than double that for part-time workers (5.2%).

Regional Variations: The regional differences in union membership, exceptionally high in Hawaii and New York and low in the Carolinas, highlight the diverse economic and political landscapes influencing union presence across the U.S.

Conclusion: The 2023 BLS report offers a nuanced view of the union membership landscape. It reveals the limited reach of unions despite a very busy 2023. The landscape of unionization in the U.S. labor market remains complex and multifaceted.

This data challenges the mainstream narrative of a surging labor movement and instead shows no growth for labor unions. As we navigate a dynamic labor market, it’s clear that unions face ongoing challenges in providing a value proposition relevant to most of today’s workforce despite a resurgence in popular opinion and the media. Ultimately, less than one in ten private sector employees are union members. Despite the perceived public approval of unions “in general,” most workforce members have decided it’s not for them, especially when presented with the facts.

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On The Horizon: Challenges To Government Agency Power Stacking Up

By Kimberly Ricci

Right out of the gate, Biden’s incarnation of the NLRB formed a habit of changing the rules on employers to tip the balance in favor of unions. This tactic accelerated over the recent holidays, with the board fast-tracking elections right after they published a new final joint-employer rule, which landed while businesses were still distracted by an order to retool employee handbooks. It’s an aggressive domino effect, to say the least.

Is there any limit to how government agencies, including the NLRB, can seemingly act at whim to switch up standards?

The tide might be turning on a few fronts. Currently, the Supreme Court appears poised to either overturn or limit the long-standing Chevron doctrine. This move could end a 40-year standard that essentially directs courts, while interpreting an unclear law, to defer to any “reasonable interpretation” from an agency. That’s not a tough hurdle to meet, and that can be bad news when an agency such as the NLRB claims to possess unrivaled expertise to receive deference on labor issues.

As it stands, preliminary arguments show that the Supreme Court’s majority isn’t thrilled with the NLRB’s musical chairs and morphing policies that can force companies to switch course with new presidential administrations.

A final ruling will come later this summer, and in the meantime, we can look toward current cases involving SpaceX and the Starbucks union for further scrutiny of agency power.

SpaceX: The company’s recent federal lawsuit challenges the NLRB’s structure as being unconstitutional due to violating separation of powers. In particular, SpaceX raises doubts about the agency’s use of in-house judges and the NLRB’s authority to enforce administrative law rulings – thereby acting as legislative, judicial, and executive branches in one package.

Part of the SpaceX argument revolves around the NLRB’s ability to internally approve General Counsel Jennifer Abruzzo’s requests for 10(j) injunctions against employers upon accusation of unfair labor practices, even before the facts of a case are discovered.

If the Elon Musk-helmed company succeeds with the above case, the NLRB’s ability to call the shots on workplace practices could take a hit.

Starbucks Workers United: The National Right to Work Foundation (NRTW) filed a federal lawsuit during pro bono representation of a Buffalo, NY, worker who lost a bid to ditch the union. According to the lawsuit, the NLRB dismissed the decertification petition, thereby preventing a majority vote to remove the union. This shutdown follows the NLRB’s general practice of making union removal a slow, convoluted, and often grueling process, whereas the agency does everything possible to make unionization easier.

The NRTW further argued that the agency’s current framework is unconstitutional because the president cannot remove NLRB board members at will. This essentially grants the agency nearly unchecked power on matters of labor law, meaning that it issues rules, uses in-house judges to rule upon disputes, including union election procedures and removal of unions from a workplace, and can enforce its own rulings.

Where this issue goes from here: These two lawsuits, along with strong suggestions that the Chevron doctrine could fall, point towards an interesting trend indeed. That is to say, the NLRB's overreach may soon be somewhat constrained.

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High Stake Labor Law Showdowns

By Michael VanDervort

Yesterday, we delved into the increasingly contentious dynamic between federal agencies, like the National Labor Relations Board (NLRB), and their challengers in the legal arena. These aren’t the only challenges the NLRB and other agencies face; employers are actively using the legal system to push back on many fronts.

Take Tesla Inc., for instance. The electric car giant is preparing for a monumental legal showdown at the US Court of Appeals for the Fifth Circuit. At the heart of the dispute is a tweet from CEO Elon Musk, which has sparked controversy over its implications for unionizing workers' stock options. Previously, an NLRB decision, backed by a three-judge panel, classified Musk's tweet as an illegal threat. This pivotal case is set to test the boundaries between First Amendment rights and federal labor laws, especially within the digital sphere of social media. The outcome could significantly alter the NLRB's authority in policing employer speech. Tesla's challenge to the NLRB's First Amendment interpretations could reshape the NLRB's enforcement strategies and the landscape of employment law.

Another legal tussle involves Google LLC, which is appealing an NLRB ruling at the US Court of Appeals for the District of Columbia Circuit. This ruling directed Google to negotiate with YouTube contract workers, following the NLRB's determination that Google and Cognizant Technology Solutions Corp. are joint employers of these workers, yet failed to engage in collective bargaining. Initially filed in separate circuits by Google, Cognizant, and the Alphabet Workers Union (representing the YouTube employees), the case was consolidated in the D.C. Circuit by the US Judicial Panel on Multidistrict Litigation, in accordance with federal guidelines. The Alphabet Workers Union, part of the Communications Workers of America, was unanimously chosen by YouTube workers employed by Cognizant. The union's position was bolstered by the NLRB's affirmation of a regional director's decision, recognizing Google's significant control over these workers.

The Biden administration is also caught in a legal entanglement with business groups at the 5th U.S. Circuit Court of Appeals. This clash centers around the Department of Labor's (DOL) new independent contractor regulations, which replaced a Trump-era rule and sparked a lawsuit. A district court found the DOL's withdrawal of the Trump rule violated the Administrative Procedure Act, a decision now contested by the Biden administration. With the DOL's announcement of the new rule, business groups are urging the 5th Circuit to lift its stay and revert the case to the district court, referencing the Supreme Court's ruling in Biden v. Texas. However, the Biden administration aims to nullify the district court's decision, citing United States v. Munsingwear, Inc., and contending that the new rule makes the case moot - a point contested by the business groups. As this legal saga unfolds, employers should closely monitor the developments, especially as the final rule faces additional hurdles in a Georgia federal district court.

For employers navigating these turbulent waters, keeping your labor lawyer on speed dial might be more crucial than ever in 2024. This trend of legal challenges seems poised to escalate.

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Subject: Trendspotting: Several Heaping Helpings Of NLRB Heavy Handedness: LRI INK