Dec 19, 2019 - 4:00pm

The NLRB’s Holiday Cheer

The National Labor Relations Board (NLRB) this week announced several actions that reverse controversial policies adopted by the agency during the Obama administration. These actions coincide with the departure of Democrat Board member Lauren McFerran, whose term ended December 16.

First, the Board issued a decision addressing employers’ right to control how their own email systems are used by employees. In 2014, the NLRB issued a decision in Purple Communications, Inc., in which the Democrat majority held that Section 7 of the National Labor Relations Act (NLRA) protects employees’ use of email systems at work to communicate about organizing and related activity. That decision overruled a previous 2007 holding in Register-Guard that employees have “no statutory right to use [an employer’s] email system for Section 7 purposes.” In the present case, Caesars Entertainment, the Board noted that “decades of Board precedent establish that the Act generally does not restrict an employer’s right to control the use of its equipment” and that Purple Communications “impermissibly discounted employers’ property rights in their IT resources while overstating the importance of those resources to Section 7 activity.” It therefore restored the Register-Guard precedent with exceptions in “rare cases” when using an employer’s email system is “the only reasonable means for employees to communicate with one another.”

The NLRB also ordered an administrative law judge to approve a roughly $170,000 settlement between McDonald’s franchisees and their workers that also absolves the fast food giant from any direct responsibility as a joint employer. The various cases involved in the settlement had been ongoing for approximately three years and highlighted the Obama administration’s effort to rewrite the standard for joint employment, most prominently in the 2015 Browning-Ferris decision.   The NLRB’s General Counsel and McDonald’s told an administrative law judge in March 2018 that they had agreed on the terms of a settlement for each of the cases, but the judge rejected the proposed settlements that July because they “‘d[id] not in any way approximate the remedial effect’ of a joint-employer finding,” which was the Obama administration’s objective in the first place. The NLRB’s latest action is a good indication that the current Board is unwilling to adopt the flawed joint employer standard espoused by Browning-Ferris and thus it will not deem franchisers and companies that rely on contracted labor to be joint employers unless there is strong evidence that the parent company directly controls the workers involved.

In addition to those two decisions, the NLRB issued a ruling in Apogee Retail in which it held that “work rules requiring confidentiality during the course of workplace investigations are presumptively lawful.” This decision overruled another 2015 decision in Banner Estrella, in which the Board declared that a rule requiring confidentiality in certain types of workplace investigations violated the NLRA. In Apogee Retail, the Board applied a test announced in its 2017 Boeing decision and found that “investigative confidentiality rules are lawful and fall within Boeing Category 1—types of rules that are lawful to maintain—where by their terms the rules apply for the duration of any investigation.” Finding that the specific rules at issue in the present case actually fall in Boeing Category 2 warranting “individualized scrutiny,” however, the Board remanded the case to the Regional Director for further analysis of the rules’ legality.

The last case of note restored a longstanding policy involving dues check-off obligations. In Valley Hospital Medical Center, Inc. d/b/a Valley Hospital Medical Center, the Board held that an employer’s obligation to continue collecting union dues terminates with the expiration of a collective bargaining agreement containing a dues check-off provision. That policy had been in effect for over 50 years under the 1962 Bethlehem Steel precedent until the Board overturned it with the 2015 Lincoln Lutheran of Racine decision, which overruled Bethlehem Steel and held that employers must continue collecting and remitting dues even if a union contract has expired. 

Given the breadth of the Obama-era NLRB’s overreach, one might expect more positive shifts in Board policy, but as far as these go, they offer a nice dose of holiday cheer for all.

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