Acting General Counsel of the NLRB Under Investigation for Allegations of Improper Conduct

Contributed by Paul Jaquez

Lafe Solomon, acting general counsel for the National Labor Relations Board (NLRB) is under investigation for allegations of improper conduct. Specifically, Solomon is being accused of participating in a case in which he had a financial interest. The investigation began with a “hotline complaint,” and culminated in a report issued by the NLRB Inspector General David Berry, finding that the facts discovered substantiated the allegations.

The controversy surrounds Mr. Solomon’s involvement in a matter pertaining to the alleged over-breadth of Wal-Mart’s social media policy and its ancillary violation of Section 7 of the NLRA.  According to the report, on January 23, 2012, Mr. Solomon met with the Division of Advice to discuss the Wal-Mart matter.  Subsequently, Mr. Solomon then applied for a waiver on January 30, 2012, to participate on the matter, based on his ownership of Wal-Mart stock (valued at roughly $15,000).  Mr. Solomon’s waiver application was denied on February 1, 2012.  Mr. Solomon sold his Wal-Mart stock on February 27, 2012.

To be certain, Mr. Solomon did convey at all material times that he owned Wal-Mart stock.  Nonetheless, Mr. Berry’s report found that Mr. Solomon, by participating in the January 23, 2012 meeting, had violated the prohibition of “participating personally and substantially in an official capacity in any particular matter, in which, to his knowledge, he has a financial interest, if the particular matter will have a direct and predictable effect on that interest.” 

The basis of Mr. Berry’s findings focus on the following:

(1)    Mr. Solomon’s participation was “personal” because he participated directly in the matter;

(2)   Mr. Solomon’s actions were of substantial significance in that he made actual decisions regarding how to proceed, which were “not perfunctory, administrative, or peripheral;” and

(3)   A disqualifying financial interest arose from Mr. Solomon’s ownership of publicly traded stock of a corporate whose value exceeded $15,000.

Mr. Berry’s report found no evidence to support a finding that Mr. Solomon acted with the intent to enrich himself or otherwise achieve any financial benefit.  It is not certain what ramifications Mr. Berry’s report will have on Mr. Solomon.