Happy Labor Day from the NLRB to Nonunion Workplaces

The percentage of private sector employees who are union members is down to about 7%. Many nonunion employers think that the National Labor Relations Act, and the National Labor Relations Board that administers the NLRA, don't apply to them. But under the Obama administration, the NLRB is aggressively pursuing non-union employers and seeking to intrude on workplace policies.

The NLRB’s justification for its intrusion into nonunion workplaces is found in the broad language of Sections 7 and 8(a)(1) of the NLRA. Section 7 provides that employees have the right to "form, join, or assist" unions, to bargain collectively with their employers, and to "engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection." Section 8(a)(1) of the NLRA states that it is unlawful for employers to "interfere with, restrain, or coerce employees" regarding their Section 7 rights.

It is likely that the NLRB will aggressively prosecute any employer policies that the agency believes will restrict concerted activity in nonunion workplaces. “Concerted activity” under the NRLA is extremely broad – it applies to any activity where two or more employees act together in furtherance of matters of mutual interest.  These matters of mutual interest can include compensation, benefits or a variety of workplace conditions.

“Concerted activity” comes into play any time an employee alleges he or she is working with another employee or on behalf of another employee. No union or employee representative needs to be involved; two disgruntled employees working together can be engaged in “concerted activity.”

Here are some specific policies and situations in nonunion workplaces that the NLRB is fighting:

• Retaliatory discharge.  See Family Healthcare, Inc., 354 NLRB No. 29 (2009), where a physician-employee claimed she was discharged in retaliation of her rights under the NLRA after she questioned the changes in contracts that she and her fellow employees were asked to sign, because she acted not only for herself but for other employees.  See also In Re Trompler v. NLRB, 338 F.3d 747 (7th Cir. 2003), where production employees walked off the job at a nonunion machine shop.  They had complained about their supervisor, which was found to be “concerted activity.” 

• Dispute resolution programs that condition employment on arbitration and prohibit employee class actions.  See D.R. Horton, 357 N.L.R.B. No. 184 (Jan. 3, 2012). Although this case is now on appeal to the Fifth Circuit Court of Appeals, the NLRB continues to pursue the theory in other cases.  See 24 Hour Fitness, Case No. 20-CA-35419, where the employer provided employees with an opt-out provision, but the NLRB still argues that the arbitration agreement is unlawful. In fact, in Advanced Services Inc., Case No. 26-CA-63184 (July 2, 2012), the NLRB even argues that the confidentiality of arbitration proceedings unlawfully chills employees' rights to discuss the terms and conditions of their employment.

• At will employment policies that suggest they can’t be changed through collective bargaining by a union. See American Red Cross Arizona, Case No. 28-CA-23443 (Feb. 1, 2012), where the employer’s policy provided that an employee's "at-will employment relationship cannot be amended, modified or altered in any way," and the NLRB found that such a policy interfered with employees' rights to form a union.

• Requirements that employees keep workplace investigations confidential. See Banner Health System, 358 N.L.R.B. No. 93 (July 30, 2012), where the NLRB said an employers' "generalized concern with protecting the integrity of [workplace] investigations is insufficient to outweigh employees' Section 7 rights." Basically, the NLRB ruled that "blanket" confidentiality rules are illegal, and an employer must justify confidentiality on a case-by-case basis.

• Restrictive social media policies. See Hyatt Hotels Corporation, Case No. 28-CA-61114, where the employer required employees to report "any known or suspected violations of [its code of conduct], including any violations of the laws, rules, regulations, or policies that apply to Hyatt." The NLRB said employers must permit employees to report employer violations via social media channels, rather than only to the employer.

• Notices in nonunion workplaces stating that employees have the right to unionize.  See Notification of Employee Rights Under the National Labor Relations Act, NLRB, Final Rule, published in the Federal Register on August 30, 2011, 76 Fed. Reg.  54,007. The effective date of this Final Rule was delayed until April 30, 2012, but in U.S. Chamber of Commerce v. NLRB, the U.S. District Court in South Carolina stayed these regulations.

• Requiring nonunion employers to permit employees to have a representative present during investigative meetings.  These so-called “Weingarten” rights have been pushed and retracted several times, depending on whether Republicans or Democrats control the NLRB.  Currently, there is no right for nonunion employees to have a representative present during inquiries, but under the current Democratic Administration, I suspect this right would be reinstated if a case were brought before the Board.

The only way a nonunion employer can avoid investigation and prosecution by the NLRB is to make sure before terminating an employee that that employee has not engaged in any activity of mutual benefit with other employees – i.e., that there has not been any “concerted activity” that could give rise to an unfair labor practice charge.

Moreover, employers must review their policies to be sure they don’t run afoul of policies that the NLRB disapproves of.  And they should be sure to follow all NLRB requirements regarding posters, employee representation, and what supervisors can and cannot tell employees.

Additional resources on this topic include NLRB Extends Reach To Nonunion Workplaces, by Jonathan C. Fritts, Ross H. Friedman and Doreen S. Davis (Morgan Lewis), and Avoid Violations of Nonunion Employees Under NLRA, by Gigi O'Hara (Kutak Rock), and a new book entitled NLRA Rights in the Nonunion Workplace,by Kenneth Lopatka (BNA).

Readers might also check the NLRB's webpage on protected concerted activity.