Patrick Finegan and Lindsey
In the past month, there has been a flurry of activity
related to the National Labor Relations Board. Below is a summary of four
of the most recent and important events.
On December 21, 2011, the National Labor Relations Board
("NLRB" or "Board") released a final rule amending its
procedures in union representation cases to limit the issues considered in NLRB
hearings, eliminate pre-election Board review of regional directors' decisions,
and take other steps the agency stated will "reduce unnecessary litigation
and delays." The final rule, which was published in the December 22
Federal Register, is a somewhat scaled-back version of the measures that a
divided NLRB proposed in a June rulemaking notice, but business groups are
still expressing strong disapproval of the final rule. NLRB Chairman Mark
Gaston Pearce (D) and Member Craig Becker (D) approved the final rule without
the agreement of Member Brian E. Hayes (R), who opposes the action. The
rule is slated to take effect on April 30, 2012.
Opponents of the final rule believe that it unfairly
curtails employers' ability to communicate with workers during the union
election process and limits employers' opportunities to bring legal challenges.
In other words, these "ambush" election rules shorten the time
between the filing of an election petition and actual voting, making it easier
for unions to win elections and more difficult for employers to effectively
communicate with workers prior to votes.
Supporting Board members and union supporters, however,
state that the procedural changes will reduce the number of piecemeal appeals
in representation cases and simplify the processing of election
petitions."This rule is about giving all employees who have petitioned for
an election the right to vote in a timely manner and without the impediment of
needless litigation," said Pearce.
Specifically, the final rule makes seven changes to NLRB
procedures in representation cases:
This controversial rule, and the method in which it was
conceived, is facing strict scrutiny and challenges from multiple avenues.
Anticipating the Board's decision, on December 20, 2011, the day before the
Final Rule was announced, the U.S. Chamber of Commerce and the Coalition for a
Democratic Workplace filed a lawsuit in U.S. District Court for the District of
Columbia, seeking to enjoin the agency from enforcing the rule. The
complaint asserted that the final rule violates the National Labor Relations
Act (NLRA), exceeds the Board's statutory authority, and is contrary to the
First and Fifth amendments to the U.S. Constitution, which guarantee the rights
to free speech and due process. Additionally, the organizations allege
that by issuing a final rule on the signature of just two members of the NLRB,
the Board's actions are "arbitrary, capricious, and an abuse of
Furthermore, on the same day the final rule was issued,
Senator Mike Enzi (R-Wyo), the ranking member on the Senate Health, Education,
Labor and Pensions ("HELP") Committee, announced that he intends to
use the Congressional Review Act ("CRA") to challenge the
rule. The CRA allows either the Senate or the House to introduce a joint
resolution of disapproval with the full force of the law to stop a federal
agency from implementing a recent rule or regulation. Such a resolution of
disapproval needs only a simple majority in the Senate to pass if acted upon
during a 60-day window, and cannot be filibustered.
Then, on Friday, December 23, 2011, the NLRB again
announced that it had delayed the effective date of its new notice-posting rule
to April 30, 2012. This marks the second time the Board has changed the
date: the posting requirement originally was to have gone into effect in
November, but the Board moved the effective date to January 31, 2012, stating
that additional time was needed "in order to allow for enhanced education
and outreach to employers."
This time, the NLRB postponed the date at the request of
a federal court overseeing a legal challenge from business groups. The National
Association of Manufacturers ("NAM") and the Coalition for a
Democratic Workplace filed suit September 8, 2011 in federal district court in
Washington, D.C., alleging that the NLRB acted outside of its jurisdiction and
should suspend the rule. A second lawsuit was also filed in the nation's
capital on September 16, 2011, by the National Federation of Independent
Business ("NFIB"), the National Right to Work Legal Defense, and the
Education Foundation, asking the court to set aside the rule and declare that
the NLRB's action violates the National Labor Relations Act. These cases
were consolidated in October. A third lawsuit was brought by the U.S.
Chamber of Commerce and the South Carolina Chamber of Commerce in the U.S.
District Court of South Carolina, alleging that the Final Rule violates federal
labor and regulatory laws as well as the First Amendment.
At a December 19, 2011 hearing in the District of
Columbia, U.S. District Judge Amy Berman Jackson told NLRB lawyers that the
legal issues "deserve more time" than the January 31 effective date
gave her. She told them that they would either need to extend the effective
date again or she would enjoin the NLRB from implementing it because she needed
more time to consider the briefs and oral arguments. In a statement
announcing the new April 30 effective date, the NLRB said "postponing the
effective date of the rule would facilitate the resolution of the legal
challenges that have been filed with respect to the rule."
According to plaintiffs' counsel in the Washington, D.C.
litigation, the notice posting rule, which was proposed in December 2010 and
finalized in August, goes beyond the bounds of the NLRB's authority and
encroaches on employers' First Amendment right. The NFIB's October 26
summary judgment bid said that the NLRB, over the course of its 76-year
history, has never required a notice posting by employers who had not run afoul
of the NLRA or had not been involved in a representation proceeding before the
However, the NLRB's cross-motion for summary judgment,
also filed on October 26, said the rule's opponents were failing to take into
account the scope of the Board's broad rulemaking authority as described by the
U.S. Supreme Court in its 1991 decision in American Hospital Association v.
NLRB ("AHA"). That decision makes it clear that unless the
NLRB has been expressly limited in some manner, Section 6 of the NLRA gives the
Board authority to make such rules and regulations as may be necessary to carry
out the provisions of the NLRA, the NLRB argued. "No such limitation was
found in AHA, and there is no such limitation here. By attacking the Board's
rule on the basis that the NLRA does not expressly authorize a notice-posting
requirement, the opponents turn AHA completely on its head," the NLRB
While the NAM claimed that the posting requirement
amounts to compelled speech which violates the First Amendment, the NLRB stated
that the notice involves governmental speech, not employer speech. The posters
say they are official government notices and don't contain anything that is
attributed to the employer, the Board argued.
The notice requirements' final rule requires all
employers subject to the Board's jurisdiction to post a notice in the workplace
informing employees of their right, among other things, to:
The notice also provides examples of unlawful employer
and union conduct and instructs employees how to contact the NLRB with
questions or complaints.
"Employers subject to the Board's jurisdiction"
encompass the vast majority of employers doing business in the United
States. This includes most private-sector employers, including labor
unions, but excludes agricultural, railroad and airline employers, as well as
very small employers that conduct an insufficient volume of business to have
more than a slight effect on interstate commerce. In addition, the NLRB
has agreed to exempt the U.S. Postal Service from the new posting requirement.
The poster must be placed in a conspicuous place readily
seen by employees. If at least 20% of employees speak a language other than
English, the notice must also be posted in the second language (the Board will
provide translations of the Notice, and of the required link to the Board's
website, in the appropriate languages). Additionally, employers who customarily
post notices to employees regarding personnel rules or policies on an internet
or intranet site will be required to post the Board's notice on those
There are several potentially adverse affects of failing
to post the notice. First, it will be an unfair labor practice under Section
8(a)(1) of the NLRA. Second, failure to post the required notice could
toll the six-month statute of limitations for filing unfair labor
practices. Third, the Board could use the failure to post the notice as
evidence of an employer's unlawful motive in unfair labor practice cases.
On January 4, 2012, President Obama made three recess
appointments to the NLRB, to fill vacant seats needed to keep the agency
operational. The appointments include Board members Terrence R. Flynn (R),
Sharon Block (D), and Richard Griffin (D). The president had nominated
Flynn to the Board January 4, 2011, and Block and Griffin on December 15, 2011,
but the Senate Health, Education, Labor and Pensions ("HELP")
Committee had not yet acted on the nominations.
President Obama's announcement regarding the recess
appointments came one day after Member Craig Becker's (D) recess term ended.
Becker's departure left the Board with only two members, leaving it unable to
function without new appointments.
The president's actions meant bypassing Congress, a move
Republicans have vowed to protest. The Constitution gives the president
the authority to make temporary recess appointments to fill vacant positions
when the Senate is in recess. Obama claims that Congress was in recess
until January 23, because it had not conducted any legislative business since
it adjourned for holiday break December 17. Republicans, however,
countered that the U.S. Senate had avoided entering into a formal recess by
holding pro forma sessions, in which a local member of Congress reports to
Capitol Hill to quickly gavel in and out of session every three days to keep
the legislative session active.
The crux of the matter is whether Congress was actually
in recess, as President Obama and his attorneys believe that the Senate could
not use these "sham pro forma sessions" to prevent him from
exercising this constitutional power. On January 12, The Department of
Justice released a memorandum opinion on the lawfulness of recess appointments
made during a recess of the Senate where pro forma sessions are held, finding
that the president is allowed to make such appointments. Despite the
support of White House attorneys, with the history and the intent of the
president's recess appointment power in question, the fight over this issue is
likely to make its way through the lower courts quickly and land before the
nation's highest court before anything can ultimately be
While outrage and protests will likely continue, at this
time the recess appointees plan to take up their posts. All have significant
background in traditional labor work.
Flynn is currently chief counsel to NLRB member Hayes,
and, prior to that, was chief counsel to former NLRB member Peter
Schaumber. From 1996 to 2003, he was counsel in the labor and employment
group of Cromwell & Moring LLP, and previously worked at the firms of David
Hagner Juney & Krupin and Reid & Priest. Flynn holds an
undergraduate degree from the University of Maryland, College Park, and a law
degree from Washington & Lee University School of Law.
At the time of her appointment, Block was working as the
deputy assistant secretary for congressional affairs at the U.S. Department of
Labor ("DOL"). Prior to her DOL position, Block worked as senior
labor and employment counsel for the Senate HELP Committee, and was a
senior attorney to NLRB Chair Robert Battista from 2003 to 2006. She was
also an assistant general counsel at the National Endowment for the Humanities
and an associate at Steptoe & Johnson LLP. She holds a bachelor's
degree from Columbia University and a law degree from Georgetown University Law
Currently, Griffin is the general counsel for the
International Union of Operating Engineers. He has also served on the
board of directors for the AFL-CIO Lawyers Coordinating Committee, and from
1981 to 1983, he served as an attorney for NLRB Board members. He has a
bachelor's degree from Yale University and a law degree from Northeastern
School of Law.
Throughout much of last year, the NLRB and the
International Association of Machinists ("IAM") had argued that
Boeing Co. had decided to locate a new plant to build its new 787 Dreamliner
jets in South Carolina, a right-to-work state, in retaliation for strikes by
unionized workers at its existing facilities in Washington state. Facing the
prospect of losing up to 3,000 IAM jobs assembling the 787s to the new, non-union
plant in Charleston, IAM formally accused Boeing of unfair labor
practices. A charge was filed on March 28, 2010, and an NLRB complaint was
issued April 20, 2011. A hearing before a National Labor Relations Board
administrative law judge had been locked since June in pre-evidentiary
maneuvering, and NLRB Acting General Counsel Lafe Solomon's decision to pursue
the case against Boeing provoked considerable backlash from Republicans and
Then, in early December of this past year, IAM members
voted to ratify a four-year collective bargaining agreement ("CBA")
with Boeing, that, among other things, guarantees that Boeing will build its
updated 737 MAX in the union facilities in Washington. With the new CBA
in place, the NLRB dropped its case, stating that "the charge was always
about the loss of jobs in the Seattle area," and, with the new deal,
"jobs are secure in the Washington area, and also jobs are secure in South
Conservative critics, however, are still angry that the
case was brought in the first place. South Carolina Senator Jim DeMint
(R), a vocal GOP critic, said in a statement: "The NLRB's dismissal of
charges against Boeing only after union approval of their new contract only
confirms the charges were a politically motivated negotiation tactic, not a
serious complaint based on merit. Unfortunately, the real and serious
damage to America's competitiveness has already been done. A precedent has
been set by the NLRB that they will attack businesses in forced-unionism states
that try to create jobs in right-to-work states."
This article was prepared by William P. Finegan (email@example.com or 214 855
7455) and Lindsey D. Sberna (firstname.lastname@example.org or 214 855 7441)
from Fulbright's Labor and Employment
Law Practice Group. If you have any questions, please contact any of our labor
and employment attorneys.
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