he Obama-era DOL and NLRB rolled out some guidance and opinions on joint employment and independent contractors. Frankly, the agency actions were crazy broad. The result: Tons more contractors and employees on someone else’s payroll looked to the Feds like your employees. We’ve written about it for the Corporate Counsel Newsletter and Corporate Counsel Review.
Lee Winkelman and Alan Bush are freelance contributors for Texas Lawyer. Their latest article, “How to Handle Digital Damage Control” appeared in the In-House Focus section on May 1, 2017.
Employees can get into a lot of trouble with a smartphone and a social media account or two. Here’s what Lee and Alan had to say about it:
The NLRB has handed down boatloads of pro-union decisions since President Obama appointed three members to the NLRB while Congress was in recess. The decisions are now in serious question. Reset button, anyone?
The D.C. Court of Appeals just ruled that the President's recess appointments violated the Constitution. That nails three members of the five-member board, which deprives it of a quorum. Expect the NLRB to appeal to the Supreme Court.
Unless the Supreme Court reverses course, all those pro-union NLRB decisions could get tossed into the waste basket. The NLRB had stepped into the mix on some sensitive issues like:
- Arbitration class action waivers
- Social media
- Witness statements
- Bargaining unit gerrymandering
Remember the NLRB's new sneak-attack union election rule? The rule lets unions surprise complacent companies with fast-track union elections. A federal court in DC just invalidated the rule. That's good news for employers. For now, at least...
The court nailed the rule on a technicality. The two Democratic members of the NLRB basically passed the rule over e-mail without any reply from the NLRB's lone Republican member. That wasn't a quorum, said the court.
Still, the court emphasized that its ruling "need not necessarily spell the end of the final rule for all time." The door is open for President Obama's newly-appointed NLRB to pass the rule again. The court put it this way:
[I]t may well be that, had a quorum participated in [the rule's] promulgation, the final rule would have been found perfectly lawful. As a result, nothing appears to prevent a properly constituted quorum of the Board from voting to adopt the rule if it has the desire to do so.
Expect the NLRB to take a second bite at the apple. I think it’s just a matter of time. But what should employers do while we wait?
You might take steps now to resist a union organizing drive in short-order. Unions thrive on the element of surprise, even under the current union election rules. We've written about it before. That puts advance preparedness at a premium. For example, you might:
- Identify employees who qualify as "supervisors" in the NLRB's eyes, so they can be trained how to spot and react to covert union activity.
- Ask your employees about their job satisfaction and address any concerns before a union does.
- Task a rapid deployment team who is armed with an action plan to execute if you detect union activity.
- Check your employee handbook for provisions that could trigger an unfair labor practice charge, such as an overly broad social media policy.
I doubt we’ve heard the last from the NLRB.
Strike that, reverse it. After a key court loss, the NLRB has indefinitely postponed the effective date for its union rights poster rule. The NLRB says it will pick the rule back up once the legal challenge has been resolved. No need to put up the poster now.
The NLRB's press release is here.
Looks like union and non-union companies must post a union rights notice by April 30. A federal district court recently upheld the NLRB's new poster rule. Here's the NLRB detail on the poster which includes a downloadable version of the poster.
We've written about this one before. Check out more details here.
Want to push back? We've also written on union avoidance countermeasures here.
Remember those pesky overtime claims where one bad policy can trigger a class action-like lawsuit? We've suggested heading off the class warfare with mandatory arbitration policies that prohibit class-wide arbitration. Well, the NLRB just stuck its nose into that too. And you can imagine how that one went...
Class waivers, says the NLRB in D.R. Horton, violate employees' NLRA-guaranteed right to engage in "concerted activity." Not that long ago, the NLRB used this same right to move aggressively into regulating social media. If you force employees to sign an arbitration policy that has a class waiver, the NLRB will haul you in for an unfair labor practice.
The NLRB's ruling applies to you so long as you're covered by the NLRA—even if you're union free.
But there's good news. Managers, supervisors and independent contractors have no right to engage in "concerted activity" under the NLRA. The NLRB's ruling does not cover them. Satisfy the NLRB that your worker falls into one of those groups and you might require a class action waiver.
What about class waivers that are selectively imposed? Instead of including the waiver in a blanket arbitration policy for all employees, you might have all (or many of) your exempt employees sign an arbitration agreement with a class waiver. That might keep classes of your employees from ganging together to claim they were misclassified as salaried exempt. Better be sure, though, that the workers truly meet the NLRA's definition of managers, supervisors or independent contractors. Or you the NLRB could put you in a world of hurt.
I doubt we've heard the last of D.R. Horton. The NLRB's ruling will probably be appealed to the courts. Stay tuned.