It’s a myth that Twinkies last forever. And just as these childhood staples will expire, it appears that the iconic brand behind them has also finished its run. Hostess filed for its second bankruptcy in January and has since been trying to come out from under a mountain of debt. These efforts came in the form of negotiating new contracts with members of the Bakery, Confectionary, Tobacco Workers and Grain Millers International Union (BCTGM). Sadly, on Friday November 16, 2012, Hostess announced “It’s over,” and that it would be closing its doors and shutting down. The death knell for the financially struggling snack cake brand came on November 9th when members of BCTGM went on strike, effectively crippling Hostess. As reported by the Associated Press, the nationwide strike came after Hostess proposed a new union contract, which cut a “$100 million a year contribution to pension costs to workers to $25 million a year, in addition to wage cuts and a 17 percent reduction in health benefits.” The union rejected this offer, went on strike, and Hostess waved the white flag. Twinkie lovers felt a glimmer of hope on Monday November 20, when Hostess and the union attempted mediation to resolve the conflicts plaguing the company. Alas, mediation failed and Hostess has moved forward with its plan to liquidate. Hostess’s liquidation means the closure of 33 bakeries, 565 distribution centers, and 570 bakery stores nationwide, not to mention the thousands of jobs lost. In the aftermath, people are paying $100 for a box of Twinkies on EBay to preserve childhood memories. Remember…they don’t last forever.
The acting general counsel for the National Labor Relations Board (NLRB), Lafe Solomon, has addressed a number of workplace topics, including social media policies, at-will employment statements and class action waivers in arbitration agreements. In addition, a new NLRB webpage describes the rights of employees, even if they are not in a union. Both of these activities demonstrate that the labor watchdogs are not taking a summer vacation – and neither should diligent employers. Social Media Policies On June 11, 2012, Solomon said approximately 100 social media-related unfair labor practice charges were pending at the NLRB. This should not be surprising news for anyone following the agency’s activity over the past year. Since August 2011, the NLRB has issued three guidance memoranda on the issue. In these memoranda, the acting general counsel explains what social media actions are protected by the National Labor Relations Act (the Act) and what types of employer policies on social media violate the Act. Notably, Solomon pointed out that his most recent memorandum (issued May 30, 2012) contained the full text of an approved social media policy and provided guidance for employers struggling to develop guidelines that would withstand a challenge under the Act. At-Will Employment Statements Solomon also talked about employers’ use of at-will disclaimers in employee handbooks. Specifically, he discussed a controversial complaint issued earlier this year by the NLRB in Phoenix, Ariz. The complaint alleged that a number of an employer’s policies were unlawful, including an at-will statement similar to those used by employers nationwide. Solomon explained that he did not approve of this complaint before it was issued, but rather became aware of it later. He stated that, in his view, an employer would not violate the Act if the employer simply told its employees that they were employed at-will. He suggested that it would also not be unlawful for an employer to tell its employees that the at-will nature of their employment cannot be changed by an oral statement alone. Solomon explained that this particular employer’s at-will statement went too far because it implied that unionization would not change an employee’s at-will status. Many employers agree to “just cause” provisions in collective bargaining agreements with unions, which alter the at-will status of employment. For this reason, Solomon said, the employer at issue in the Arizona case was in potential violation of the Act. Solomon said the case had been settled, so the NLRB’s theory would not be further tested at this point. Class Action Waivers Finally, Solomon addressed the recent conflict between the NLRB’s decision in D.R. Horton, which held that an employer’s arbitration agreement violates the Act when it requires employees to waive the right to arbitrate as a class, and the U.S. Supreme Court’s decision in AT&T Mobility v. Concepcion, where the court held that the Federal Arbitration Act authorizes precisely such waivers. Solomon stated that he saw no conflict between the decisions because, in his view, the Act pre-empts the Federal Arbitration Act. He did acknowledge, however, that most federal courts considering the issue disagreed, holding instead that Concepcion overrode D.R. Horton. What This Means to You Recent NLRB statements regarding employers’ social media policies, at-will employment disclaimers and class action waivers should serve as a reminder to employers who have not updated their policies in recent years that such updates may now be warranted. At a minimum, employers are encouraged to review their social media policies and ensure that they are narrowly tailored to the employer’s business needs and corporate culture. At-will statements must not be overly broad or imply that unionization would be futile for employees. Other policies should also be reviewed with an eye toward employees’ rights under the Act. This way, employers may be able to avoid unfair labor practice charges alleging that the employer is impinging upon employee rights.