At the NLRB, Everything Old is New Again

By Howard B. Jackson

In a series of decisions and one rule making announcement – all occurring in December – the National Labor Relations Board (“NLRB” or “Board”) overturned existing precedent and returned to previous longstanding rules on several topics, and relaxed several deadlines in its representation case election rules.  These actions are summarized below.

Employer-Owned E-mail Systems.

The Board has long balanced employer property rights against employees’ rights to organize and engage in other activities under Section 7 of the National Labor Relations Act (“Act”).  In a 2014 decision, Purple Communications, the Board held that employees who were provided with the ability to use employer-owned e-mail systems were presumptively permitted to use those systems for Section 7 activities, such as union organizing.

In Caesar’s Entertainment the Board overruled Purple Communications.  In so doing, the Board ruled that employees have no statutory right to use employer-owned IT equipment, including e-mail, for Section 7 purposes.  The Board observed that employers “unquestionably” have a property right in such systems.  Further, in the modern workplace employees have a variety of means to communicate with each other, including the typical means of face-to-face contact as well as via personal e-mail and social media.  Accordingly, finding that employees do not have a statutory right to use employer-owned systems does not unduly restrict employees’ ability to communicate with each other.

The Board created an exception to the rule where e-mail is the “only reasonable means for employees to communicate with each other.”  That would seem to be a very rare exception indeed.

Confidentiality Rules With Respect to Investigations. 

In Banner Estrella Medical Center, a 2015 case, the Board held that confidentiality rules with respect to employer investigations must be examined on a case-by-case basis, and generally required employers to provide a specific legitimate need to maintain confidentiality in any given investigation.

In Apogee Retail, LLC, the Board overruled Banner Estrella Medical Center.  Under the newly announced standard the Board will examine confidentiality rules under the standards for analyzing employer rules from Boeing Co.,  Under Boeing Co., the Board analyzes facially neutral rules that can potentially impact Section 7 rights by evaluating: “(1) the nature and extent of the potential impact of the rule on NLRA rights, and (2) legitimate justifications associated with the rule.”  After conducting that analysis, the rules are placed in one of three categories: 

• Category 1 rules are lawful because they do not prohibit or interfere with Section 7 rights or the potential limitation on Section 7 rights is outweighed by justifications supporting the rule. 
• Category 2 rules require individualized inquiry as to whether the rule prohibits or interferes with rights under the Act, and if so, whether the impact on such rights is outweighed by legitimate justifications. 
• Category 3 rules are unlawful because they prohibit or interference with the exercise of rights under the Act and their impact is not outweighed by legitimate justifications.

Against the analytical backdrop just described, the Board ruled in Apogee Retail that investigative confidentiality rules are lawful Category 1 rules where the rule by its terms applies only for the duration of the investigation.  If the rule does not clearly provide that the confidentiality requirement ends at the conclusion of the investigation then it is a Category 2 rule and subject to the analysis of whether its potential impact on Section 7 rights is, or is not, justified by legitimate considerations supporting the rule.

This represents a shift in favor of permitting employers to maintain reasonable rules that provide confidentiality during investigations.  Based on the many and varied phrasings of such rules and the multiple justifications for them in various industries, the determination of whether a particular rule will be found lawful will not be obvious in many instances.  Employers who have confidentiality requirements relative to investigations should examine the language of such policies carefully (preferably with the assistance of a qualified attorney) to determine whether the policy is compliant.

Deferral to Arbitration.

The Board has long recognized that the Act encourages parties to resolve all sorts of issues voluntarily and pursuant to mutual agreement.  One mechanism for doing so in many situations is by including grievance and arbitration provisions in a collective bargaining agreement between the employer and the union.  Using such grievance and arbitration processes allows the parties to resolve all manner of issues.

One question has long been whether the Board should defer to arbitral procedures when the issues at arbitration include fact allegations that could also constitute an unfair labor practice under the Act.  In a 2014 decision, Babcock & Wilcox Corp., the Board established a new standard for deferral.  Under Babcock the Board would defer to an arbitral decision only if the arbitrator had been expressly authorized to decide the unfair labor practice issue, was presented with and considered the issue (or was prevented from doing so by the party opposing deferral), and NLRB law reasonably supports the arbitral award.  The burden of proof was on the party urging deferral to the award.

In United Parcel Service, the Board overruled Babcock and returned to the standard that had previously been in place for years.  Under this standard, the Board will defer to the award of an arbitrator where: “(1) the arbitration proceedings were fair and regular; (2) the parties agreed to be bound; (3) the contractual issue was factually parallel to the unfair labor practice issue; (4) the arbitrator was presented generally with the facts relevant to resolving the unfair labor practice, and (5) the decision was not clearly repugnant to the purposes and policies of the Act.”  Also, the burden will be on the party opposing deferral to show defects in the process or the award.

As a practical matter, this standard will lead to greater deferral to arbitral awards.  This state of affairs promotes finality and resolution of disputes by the parties based on a process and procedure they have agreed upon via the collective bargaining agreement. 

Further, the Board adopted its previous standard for pre-arbitration deferral to the grievance and arbitration process.  Under that standard, where the collective bargaining agreement contains a grievance and arbitration procedure and there is a reasonable belief that the process will be conducted in a manner consistent with the post-arbitration deferral standard (i.e. that the proceedings will be fair and regular and the arbitrator will be presented with the appropriate facts), then the Board will defer to the arbitral process.  Adoption of this standard will lead to greater deferral to arbitration where parties file charges with the NLRB that are by their nature susceptible of resolution via the contractual grievance and arbitration mechanism.

Dues Check Off.  

When a collective bargaining agreement expires is the employer required to continue deducting union dues from the paychecks of employees who have authorized the deduction and remitting the dues to the union?  Under a previous decision the answer was yes.

In Valley Hospital Medical Center, Inc., the Board reversed that rule.  Under Valley Hospital, if the collective bargaining agreement expires the employer is no longer obligated to continue deducting union dues from the employees’ wages and remitting payment to the union.  Note that the employer may continue to do so.  But it is not obligated to do so under the Act.

Do we Still Have “Quickie” Elections? 

On December 13, 2019 the Board issued a notice of modifications to the rules that apply to election procedures.  The modifications will be effective April 16, 2020.

A detailed discussion of the revisions is beyond the scope of this article.  In general, the rule relaxes various time frames for pre-election procedures.  This will allow the parties to reasonably address matters such as who should and should not be included in the voting unit in advance of the election.  The revisions also provide somewhat more time for the employer to provide information and comply with required postings.  Again, the idea is to allow both the Board officials involved and the parties to address pre-election matters in an orderly manner so that all parties can have a greater understanding and better information before the election is held.

Application of these rules will result in some lengthening of the time between the filing of a petition and the date the election is held in cases where matters such as the makeup of the bargaining unit are in dispute.  The time frames for submissions remain relatively short, however, and the Regional Director retains significant control over the pre-election litigation process.  Accordingly, the new rules give the parties some breathing room but do not drastically alter the anticipated timing of elections.