Employers subject to a collective bargaining agreement (CBA) must proceed cautiously in determining how to handle dues checkoff and employee communications following implementation of any right-to-work laws. A recent decision by an Administrative Law Judge (ALJ) for the National Labor Relations Board (NLRB) declares that contractual dues checkoff provisions are not union security devices and thus may be enforceable despite a right-to-work law. Metalcraft of Mayville, Inc. v. District Lodge No. 10, 18-CA-178322 (2017) (Muhl, ALJ). The ALJ in Metalcraft interpreted Wisconsin’s right-to-work statute such that an employer could not unilaterally refuse to enforce dues checkoff, despite the existence of a state right-to-work law prohibiting such deductions. Instead, the ALJ found that the NLRA pre-empted state law, so dues checkoff remains a mandatory subject of bargaining, governed by federal law, regardless of the existence of a state right-to-work law prohibiting fees being deducted. And so the employer acted unlawfully in unilaterally discontinuing such deductions in violation of §8(a)5 of the NLRA.

Further, the Metalcraft decision also serves as an important reminder to employers to exercise caution in corresponding with employees about right-to-work laws. The ALJ held that a series of notices to employees containing employer-drafted questions and answers about the new right-to-work law violated §§8(a)(1) and (5) of the NLRA by undermining employees’ confidence in the union and directly dealing with employees. In that case, the employer presented no evidence it was responding to actual questions or requests for revocation of dues checkoff from employees; it phrased several questions in a manner disparaging the union; and it requested new authorizations for dues checkoff directly from employees.

The ALJ’s findings are consistent with other recent cases which have addressed the issue. In United Auto., Aerospace & Agric. Implement Workers of Am. Local 3047 v. Hardin Cty., Kentucky, the Sixth Circuit held that a county could not prohibit dues checkoff or hiring hall agreements because they were preempted by the NLRA, regardless of the existence of a valid right-to-work law. 842 F.3d 407, 410 (6th Cir. 2016). Similarly, an appeal is pending before the Seventh Circuit of a District Court decision which held, among other things, that dues checkoff does not amount to compulsory unionism and the NLRA preempts any regulation that imposes more stringent requirements than federal law. Int’l Union of Operating Engineers, Local 399, AFL–CIO v. Vill. of Lincolnshire, Illinois, No. 16 C 2395, 2017 WL 75742, at *11 (N.D. Ill. Jan. 7, 2017).

Employers with questions about how to handle dues checkoff or employee communications in preparation for implementation of right-to-work laws can contact a member of Husch Blackwell’s Labor and Employment team. For more information about right-to-work, see Husch Blackwell’s blog post: Right-to-Work in Missouri – What Does It All Mean?

Although MSHA and OSHA are members of the same governmental group, their respective areas of authority and the industries affected by them can cause misperceptions. In a recent article via ROCK Products, Safety and Health attorneys Brad Hiles and Ben McMillen explain the inter-agency agreement between MSHA and OSHA, outline “blurred line” cases and the factors typically examined by courts and commissions in such cases.

You have probably heard that Missouri joined 27 other states as a “Right-to-Work” state when Governor Greitens signed SB19 into law on Monday, February 6, 2016. Now you may be wondering what means for you.

The right-to-work law prohibits requiring employees to become a union member or to pay union dues as a condition of employment. The law will take effect to prohibit agreements that include these conditions on August 28, 2017. Once in effect, the law will apply to all agreements renewed, amended, or created. Current union employees must affirmatively revoke any existing agreements about dues in accordance with their CBA or other agreement in order to avoid contractual liability. The right-to-work law excludes federal employers and employees and those covered under the federal Railway Labor Act.

One exception to the law’s applicability has the potential to result in differing impacts on government contractors depending on where they perform their work. Section 7(3) of the enacted Senate Bill provides that the right-to-work law will not apply to “employers and employees on exclusive federal enclaves.”

Federal enclaves refer to certain federal property obtained with the consent of the state wherein the federal property lies. This can include military bases, federal facilities, and other national grounds within a state such as national parks or forests. Federal enclaves exist as a result of a United States Constitutional provision (Art. I, Section 8, Clause 17) but requires a nuanced analysis to identify because of requirements relating to when the federal government obtained the property.

Judge Gorsuch, as part of a Tenth Circuit panel, reviewed the issue of federal enclaves in Allison v. Boeing Laser Technical Services. That case illustrated several important aspects of the federal enclave doctrine such as the inability of state laws that are inconsistent with federal law to operate within an enclave and the relevance of the time that the property became an enclave to whether new state laws continue to apply to the property. If you conduct work on federal sites and have questions about whether the federal enclave exception applies to you, contact a Husch Blackwell labor and employment attorney.

Contractors not performing work on federal enclaves in Missouri should monitor attempts to reverse right-to-work via a referendum vote. Immediately after Governor Greitens signed the bill into law, a union federation (AFL-CIO) submitted a referendum petition with the Missouri Secretary of State’s office about the right-to-work law. This means that if AFL-CIO can compile enough signatures for a referendum, then the people of Missouri will vote in the November 2018 election on whether to keep right-to-work.

For more information on right-to-work legislation, see Husch Blackwell’s blog post Right-To-Work in Missouri – What Does It All Mean?

Over the last several months, we have covered judicial developments relating to the NLRB’s D.R. Horton doctrine.  As a reminder, since its D.R. Horton decision, the Board has taken the position that class-waiver provisions in arbitration agreements infringe on the rights of employees to engage in concerted activities and, therefore, violate the National Labor Relations Act.  In 2016, varying rulings from federal appellate courts created a circuit split, and on January 13, 2017, the Supreme Court of the United States granted certiorari in three cases (out of the Fifth, Seventh, and Ninth Circuits) that present the issue of whether these class-waiver provisions violate Section 8(a)(1) of the Act.

 

On January 26, 2017, the NLRB’s Office of the General Counsel issued Memorandum OM 17-11, for the purpose of providing guidance on how Regional offices should handle cases involving D.R. Horton issues during the pendency of the appeal.  The memo provides that:

 

  • where the Regional office has determined that a pending case has merit, Regional offices are directed to propose that the parties enter informal settlement agreements conditioned upon the Board prevailing before SCOTUS;
  • where informal settlement is proposed but rejected by the parties, Regional offices are directed to move forward on cases determined to have merit; and
  • where the cases involve opt in/opt out clauses in mandatory arbitration agreements (or are otherwise distinguishable from the Murphy Oil decision – the Board’s current controlling authority on the D.R. Horton issue), Regional offices are directed to hold such cases in abeyance.

 

Thus, to the extent companies want to avoid agency-level litigation prior to the Supreme Court’s disposition, they should emphasize the existence of opt in/opt out clauses in the agreements at issue or any other distinguishing factor that may persuade the Board to stay the case until the Supreme Court rules.

 

We will continue to provide updates on any developments on this important issue from the Courts or the NLRB.

Sometimes common sense is not so common. By a Memorandum dated January 31, 2017, the General Counsel of the NLRB has taken the position that student athletes at private colleges and universities are employees within the meaning of the National Labor Relations Act, notwithstanding the Board’s issuance of its decision of Northwestern University in 2015 in which it declined to exercise jurisdiction after a representation petition was filed by a union seeking to represent the Northwestern University’s football players.

So does that mean that if a football player has a serious health condition that the football coach will now have to provide FMLA to that player? Or, if the injury is more extreme, must the football coach then reasonably accommodate that player?  Or, pay overtime after 40 hours of practice?  Needless to say, you get my drift.  This has got to be one of the most ridiculous legal positions coming out of the NLRB in a long time.  Once again, the NLRB is extremely myopic and simplistic in terms of their view of the world, not taking into account the myriad of other issues that develop when such an ill-founded decision is made.  In particular, I am sure the NCAA is going to be thrilled with this approach by the Board.  Time and time again, after thorough review, the courts and other federal agencies have refused to adopt the viewpoint that such individuals are employees.  Indeed, as the 7th Circuit recently recognized in the case of Berger v. NCAA, 16-1558 (January 12, 2017), this issue has been settled for years and there is no reason to revisit it.  And while I am hopeful that in a matter of months, when we have a new GC in place at the Board, this memo will be made null and void, but in the interim we continue to have to put up with such nonsense being endorsed as our national labor policy.  Frankly, it is just embarrassing.

Earlier this month the United States Supreme Court decided to hear three cases which will resolve the split between various Courts of Appeals (discussed in our prior post here) as to whether individual arbitration agreements barring class arbitration actions in employment-related matters are enforceable. While the Court held in 2011 that the Federal Arbitration Act would allow companies to avoid consumer class actions by insisting upon individual arbitrations in their contracts, AT&T Mobility v. Concepcion, workers have contended that employment contracts are different. They have successfully argued that the National Labor Relations Act prohibits class waivers since it would impinge upon worker’s rights to engage in “concerted activities”. The Seventh Circuit Court of Appeals accepted such an argument in Epic Systems Corp. v. Lewis (discussed in our prior post here), and the Ninth Circuit accepted such an argument in Ernst and Young v. Morris. The Fifth Circuit Court of Appeals rejected the same argument in National Labor Relations Board v. Murphy Oil U.S.A. Continue Reading Mandatory Employee Arbitration Split To Be Heard By Supreme Court

Missouri’s new Republican governor has indicated that he fully supports right-to-work legislation, which failed to get past previous governor Jay Nixon in its last go-round. With that being the case, what would a right-to-work law mean for the employers in the state who have collective bargaining agreements with labor organizations?

First, right-to-work legislation does not result in any collective bargaining agreement suddenly being null and void. It is a very limited, surgical deletion of the union security clause from contracts.  And, while we do not know exactly what the law may provide, it will likely be something along the lines of previous legislation.  In other words, it will provide that any union security clause will be null and void and no employee shall be required to pay any dues or fees or similar charges to any labor organization as a condition of employment.

Accordingly, if an employee is not a union member and has not signed a dues check-off authorization card, the employer can cease deducting dues from the employee’s paycheck when the right-to-work law takes effect. However, an employer’s legal obligation is different if any employee has signed a valid dues check-off authorization card as such authorizations will likely be enforced, as a separate lawful agreement between the employee and the union.  The reason is that even after the effective date of a right-to-work law, an employer who has agreed to a dues check-off provision in the collective bargaining agreement may have a contractual obligation to continue to remit monthly dues to the union for employees who have signed dues check-off authorizations.  However that provision can be revoked.

The National Labor Relations Act provides some guidance in terms of the revocation process. In particular, it permits employers to deduct monies for dues “provided that the employer has received from each employee on whose account such deductions are made a written assignment which shall not be irrevocable for a period of more than one year or beyond the termination of the applicable collective bargaining agreement, whichever is sooner.”  Hence, while there may be an ongoing obligation beyond the effective date of the right-to-work legislation, there is a process for employees to revoke that authorization at a later point in time and not be responsible for any dues going forward.

The end result is that without financial support from a majority of the employees a union may simply walk away from the collective bargaining agreement they have with an employer as it simply is not cost effective to maintain the relationship. Hence while right-to-work legally only impacts union security and dues check-off, from a practical standpoint it may result in a defacto decertification of the union.

In a prior post, we discussed the Department of Labor’s issuance of a new final rule that expanded disclosure requirements for companies that hire union avoidance consultants.  The Department’s new “persuader” rule required employers to report the hiring of such consultants whenever these third parties engaged in indirect persuader activities (e.g., planning employee meetings, training supervisors to conduct meetings, and drafting or providing speeches to be made to employees), whereas the previous rule required disclosure only when the consultants engaged in direct contact with workers.

Subsequent to the DOL’s publication of the final version of the rule in late March, business groups and law firms sued to invalidate the rule.  Several states joined the case later as intervenors.  On November 16, a federal judge in Texas entered a “permanent injunction with nationwide effect,” blocking the DOL from enforcing the rule.  Judge Sam R. Cummings of the Northern District of Texas, had previously issued a preliminary injunction relating to the rule back in June.  In that earlier ruling, the Court had found that the rule effectively eliminated the Labor Management Disclosure Act’s advice exemption, was arbitrary capricious, and constituted an abuse of discretion.  In last week’s decision, the Court granted the Plaintiffs’ summary judgment motions and converted the preliminary injunction into a permanent injunction.

The Obama administration now faces the decision of whether to appeal the ruling, as they did with the Court’s preliminary injunction.  However, it is unlikely that the Fifth Circuit Court of Appeals would make any rulings on these issues prior to the inauguration of President-elect Donald Trump, after which the Department’s positions and strategy may change dramatically.  We will continue to keep you apprised of developments related to the persuader rule.

The legal environment for labor unions in Missouri, and across the nation, will change as a result of the 2016 state and national elections. In Missouri, the election of Eric Greitens as Governor and the supermajority of Republicans in the Missouri Senate signal the likely addition of Missouri to the list of states to have passed Right to Work laws. Missouri House Speaker Todd Richardson recently said that passing a Right to Work law “would probably be the No. 1 issue” for the start of the legislative session in January. If enacted, Missouri would become the 27th state to pass Right to Work legislation.

Right to Work laws prohibit the use of “union security” clauses as part of any collective bargaining agreement, meaning union membership cannot be a condition of employment. More significantly if membership is not mandatory, union dues will not be mandatory. For most unions, who receive the majority of their money from dues, this has the capacity to reduce or even eliminate their ability to organize, let alone administrate union contracts.

A Right to Work law in Missouri also has the potential of increasing the amount of leverage employers bring to the bargaining table. If employees begin to resign their union membership at a significant rate, an employer will have an increased ability to negotiate for its own priorities as the fear of a strike will be lessened. Furthermore, each union may have to evaluate at what point continued representation is cost effective if employees choose to leave the union and stop paying dues at a high rate.

Trump’s election to the White House will have a significant effect on national labor policy as well. Trump will nominate two people to fill the vacancies in the National Labor Relations Board (NLRB), thus influencing its direction for years to come. Employers who have transitioned to new rulings on franchises, joint employers, handbook policies and numerous other issues will likely see many of these rulings abandoned or sent to the bottom of the list when it comes to any enforcement agenda. Further, when it comes to the Department of Labor, the new overtime guidelines will likely receive close scrutiny by the new administration and it is likely the proposed changes in the Persuader Rule will be abandoned.

Finally, the executive orders that President Obama has issued over the past 8 years could be rescinded immediately, if a newly inaugurated President Trump decides to take such action. The Fair Pay and Safe Workplaces Executive Order and the Order Prohibiting Discrimination Based on Sexual Orientation and Gender Identity for federal contractors and subcontractors are just two of the likely targets of a Trump administration’s shift in labor and employment policies.

As the newly elected politicians take power, and newly appointment positions are filled, watch the Husch Blackwell Labor Relations Law Insider for updates.

On October 3, the National Labor and Relations Board (NRLB) Office of the General Counsel (OGC) issued a Memorandum from the Division of Operations-Management to all Regional Directors, Officers-In-Charge, and Resident Officers.  This Memo (Memorandum OM 17-02) reveals an aggressive new position from the OGC, one which attempts to overturn decades of Board precedent.

For years, the Board has limited workers’ ability to engage in partial or intermittent strikes. In some instances, the Board has used the term “partial strike” to include anything less than a total, traditional strike (where employees completely withdraw their labor and refuse to work until the parties settle the dispute).  This would include intermittent strikes, where employees go back and forth between working and striking.  Other times, the Board has used the term “partial strike” more narrowly to describe more specific types of limited, non-traditional strikes which are situationally distinct from intermittent strikes.  Regardless of the verbiage used, however, the Board has consistently found that Section 7 of the National Labor Relations Act (NLRA), which protects “concerted activity,” does not protect employees engaging in either of these types of limited strikes.  Under current Board precedent, therefore, employees who strike multiple times over the same labor dispute may be disciplined by their employers.

Now, the OGC wishes to dramatically extend Section 7 protection to cover multiple short-term strikes. The Memo states that the Board’s present test for determining whether such strikes are protected “is difficult to apply” and “exposes employees to potential discipline for activities that should be considered protected under Section 7 of the Act.”  Accordingly, the OGC will now be taking the position that the Board should modify the law regarding intermittent and partial strikes.  In furtherance of this effort, the Memo references an attached model brief and instructs its recipients to utilize the analysis contained in the model brief and incorporate those arguments into the General Counsel’s briefs submitted to Administrative Law Judges and the Board.

The arguments contained in the model brief “urge[] the Board to clarify this area of law by drawing clear conceptual distinctions between partial and intermittent strikes and redefining the circumstances under which intermittent strikes become unprotected.” More specifically, the General Counsel proposes a framework where multiple strikes (even if those strikes are over the same labor dispute) would be protected if: (1) the strikes “involve a complete cessation of work, and are not so brief and frequent that they are tantamount to work slowdowns”; (2) the strikes “are not designed to impose permanent conditions of work, but rather are designed to exert economic pressure”; and (3) the “employer is made aware of the employees’ purpose in striking.”  The model brief argues that this framework “more effectively protects” a worker’s right to strike, “dispenses with the unpersuasive rationales” on which the Board has previously relied, and “better addresses Supreme Court precedent.”

Unfortunately, such an expansion Section 7 protections would upend years of generally understood and accepted labor relations practices. And unsurprisingly, employers would suffer the most, as they attempt to navigate new distinctions and the nuances of newly-protected strikes that will undoubtedly disrupt operations more than traditional strikes.  Accordingly, employers will have an important role to play in NLRB proceedings by pushing back against the OGC’s new and threatening position.