Category Archives: Labor

Union Friendly PRO Act Reintroduced in Congress: Seeks to Revolutionize Labor Law Throughout the U.S.

Contributed by Michael Hughes, February 8, 2021

“Union” in block letters

The mis-named Protecting the Right to Organize Act (PRO Act) was reintroduced in the U.S. Congress on February 4, 2021. The PRO Act, which originally was introduced in 2019 and passed the House of Representatives in 2020, would completely change the landscape in the labor-relations world. You may recall that our recent blog post advised that reintroduction of the PRO Act likely was a priority of the Biden Administration and the revamped U.S. Congress.

Billed by Democrats as legislation to support workers’ rights, the PRO Act is less worker-friendly than Union-friendly. If passed, the PRO Act would overhaul the National Labor Relations Act and make it easier for unions to organize more employees, remove most restrictions on union strikes and other union pressure tactics, weaken employers’ ability to resist unionization, and provide massive fines and penalties on employers who violate the law. While the bill’s wholesale passage in the Senate may be unlikely (unless Democrats move to eliminate the filibuster), many of its terms likely will find their way into other pieces of legislation.

Among the more drastic provisions of the proposed legislation are the following:

Organizing / Elections

  • Expands which workers unions can organize (to include many who currently are considered independent contractors and supervisors)
  • Erodes the secrecy of employee ballots and increases risk of fraudulent elections by giving the union the sole determination over the manner the election is to be conducted (mail ballot, electronic, off-site or on-site elections)
  • Allows unions who lose elections, if they allege an unfair labor practice by the employer affected the election, to resort to an after-election card check to win representation rights

Collective Bargaining

  • Bans all state right-to-work laws
  • Provides for “interest arbitration” if the employer and union cannot quickly agree to terms of an initial collective bargaining agreement—meaning a slate of arbitrators would decide wages, benefits and other contract terms
  • Allows “hot cargo” agreements, where unions can demand that employers do not do business with other, non-union companies
  • Bans employers’ ability to withdraw recognition from a union, even upon evidence that all employees want the union out

Strikes / Picketing / Construction Sites

  • Allows “secondary” strikes and boycotts, meaning the union can strike against employers/companies that it does not have a dispute with, in order to force them to stop doing business with non-union companies (this would allow ANY and ALL picketing at construction sites, without regard to reserved gates, effectively allowing unions to halt construction)
  • Allows partial strikes, intermittent strikes, and slow-down strikes
  • Allows strikes in jurisdictional disputes between rival unions
  • Removes all time limits on picketing for recognition
  • Bans employers’ ability to lockout employees, unless they go on strike first

Damages / Fines

  • Civil fines up to $50,000 for any unfair labor practice (doubled for repeat offenders)
  • Requires employers to re-hire employees, pending resolution, if union alleges discharge was unlawful
  • In discharge cases, in addition to back pay, would allow for front pay, liquidated damages (2x amount of back pay), consequential and punitive damages
  • $10,000 daily fine for non-compliance with an NLRB order
  • PERSONAL liability for company directors and officers
  • Provides employees with the right to sue employers in court, even if the NLRB dismissed their charge

As stated, currently it is unlikely that the PRO Act would overcome a senate filibuster by Republicans to be passed wholesale. We will monitor any developments in this legislation, or attempts to include certain aspects of the PRO Act within other legislation and keep employers informed on this blog. Please note, the Biden administration also is moving quickly to appease its labor union constituents in other ways. Aside from reintroduction of the PRO Act, on his very first day in office, President Biden fired NLRB General Counsel Peter Robb, whose term was not set to expire until November 2021. In his tenure, Mr. Robb pressed policies that labor leaders saw as too employer-friendly. The NLRB Acting General Council named by President Biden already has issued guidance overturning several policy provisions previously enacted by Robb. President Biden also nominated Boston Mayor, Marty Walsh, former head of the Boston Building and Construction Trades Council and Local Union President as Secretary of Labor. Mr. Walsh appears headed for confirmation.

Gig Workers: An Evolving Trend or a Class Action Waiting to Happen?

Contributed by Rebecca Dobbs Bush, June 4, 2019

The workplace is changing: Millennials, Generation Z-ers, and Baby Boomers looking to supplement their retirement income. These individuals are more interested in autonomy and avoiding bad managers, office politics and lengthy, non-productive staff meetings. Plus, the tax-savvy individual knows the economic advantage of having access to traditional business deductions through a Schedule C, rather than being limited to the standard deduction or itemizing as a W-2 employee would be.

Business concept. Isolated on white

More and more businesses also seem to be interested in the advantages of a gig workforce, also called freelancers, subcontractors, contingent workforce, and more. After all, it allows a business to gain access to skills and talent without having to commit to hiring an individual as a full-time employee. According to Deloitte’s 2018 Global Human Capital Trends study, more than 40% of workers in the U.S. are employed in “alternative work arrangements.” These arrangements include contingent, part-time, or gig work.

So, is it a win-win for all involved? The problem is that current employment laws are simply not evolving at the pace required to keep up with this modern-day independent contractor. With this, a minefield is created for the unwary business. 

Under the Obama administration, the DOL had issued broad guidance suggesting that gig workers were likely to be considered “employees.” That guidance was rescinded with the change in administration. Then, on April 29, 2019, the DOL issued an atypical, 10-page opinion letter on the subject. The opinion letter lays out a detailed analysis of all the relevant factors for independent contractor status and then comes to the conclusion that the gig workers at issue are not employees.

For now, if your business is participating in the trend of the gig worker, you want to make sure the relevant factors are met. Those factors and the analysis change depending on which law the issue is being examined under. Some of the more common factors are: control, permanency of the relationship, integrality to business operations, ability to sustain a profit or loss, accountability for operating expenses, etc. In other words, is the individual truly operating as a stand-alone business? 

If you choose to engage gig workers, make sure to avoid these common mistakes:

  • Do not treat the individuals as employees. Do not even use the word “hire.” Instead, you are “engaging” their services, or “contracting” with them. And, commit to the arrangement in writing.
  • Do not be tempted to offer them benefits. Putting them in your health plan or letting them participate in a 401(k) will jeopardize any argument that they are not otherwise an employee. If it walks like a duck, quacks like a duck….
  • Do not make them sign a non-compete agreement. A critical factor in most cases is whether the individual is free to take on work from others or whether they are completely dependent on your business for work. If the individual is subject to a non-compete agreement and effectively being prevented from working for others, you will not win on this factor.

Because of the amount of exposure involved with a misclassification lawsuit, it is worthwhile to have competent employment counsel review your situation and any independent contractor agreement or contracts that you are using to help you make sure it’s being handled in the best possible manner to strengthen the individual’s status as an independent contractor.

2017 Ending With A Bang: Obama Era NLRB “Micro Unit” Ruling Reversed

Contributed by Jeffrey Risch, December 22, 2017

2017 is coming to an end, and with somewhat of a Bang! for labor relations moving forward under Trump’s NLRB.  In a matter involving PCC Structurals, Inc. and the Intern’l Assoc. of Machinists & Aerospace Workers (19-RC-202188), the NLRB this month overruled its 2011 decision in Specialty Healthcare & Rehabilitation Center of Mobile, 357 NLRB 934, and reinstated the traditional community-of-interest standard for determining an appropriate bargaining unit in union representation cases.  The essence of the 2017 decision is that the National Labor Relations Act mandates that the NLRB must evaluate, in each and every case, whether the group of employees a union seeks to represent constitutes a unit that is “appropriate” for collective bargaining.

As a reminder… in Specialty Healthcare, the NLRB held that if a union petitioned for an election among a particular group of employees, those employees PRESUMABLY shared a community of interest among themselves.  And so, if the employer took the position that the smallest appropriate unit had to include employees excluded from the proposed unit, the NLRB could not find the petitioned unit inappropriate unless the employer proved that the excluded employees shared an “overwhelming” community of interest with the petitioned-for group.  The practical effect of this ruling made it “next to impossible” for an employer to successfully challenge the union’s petitioned for “micro-unit”.

The Trump NLRB (in a 3-2 party split decision) has now abandoned the “overwhelming” community-of-interest standard stating that “there are sound policy reasons for returning to the traditional community-of-interest standard that the Board has applied throughout most of its history…”

This PCC Structurals case involved a Regional Office’s finding that a petitioned for unit (a “micro-unit”) of approximately 100 welders was appropriate for collective bargaining.  A “micro-unit” is a small and discrete subset of employees at a particular worksite or worksites, which a union seeks to represent.  It is the opposite of a “wall-to-wall unit” that would encompass the majority of an employer’s non-supervisory employees.  Applying Specialty Healthcare’s “overwhelming community of interest” standard, the Regional Director rejected the employer’s contention that the smallest appropriate unit was a wall-to-wall unit of 2,565 employees.

Of course, the more limited that a union defines a petitioned for unit, the less number of employees belong to the unit and the easier it is for the union to “cherry pick” the necessary votes to win an election and get a “foot in the door” of an employer.  We saw this work to the union’s benefit in many cases since Specialty Healthcare (see here).

The Quick Take Away:  Despite this favorable ruling for employers who prefer to remain union-free, it may be temporary due to what political party occupies the White House; and it does not prevent unions from successfully petitioning for smaller units at a place of business that would otherwise meet the “community of interest” standard.  Indeed, smaller units have always been successfully petitioned for by labor unions under this standard.  But, for the time being, big labor may not be able to “cherry pick” a few employees at a time.

The NLRB is Locked and Loaded – Ready to Go

Contributed by Karuna Brunk

The National Labor Relations Board now has five Senate-confirmed members and is “ready to go,” according to Chairman Mark Gaston Pearce.  This is the first time since 2003 that the NLRB has five sitting members.  The pro-union Board has been joined by AFL-CIO attorney Nancy Schiffer and union lawyer Kent Hirozawa.

The Board is particularly focused on facilitating and expediting union organizing.  First, and most notably, the Board is set to implement the ambush or “quickie” election rule, which would reduce the amount of time between when a union files a representation petition and when an election takes place from the average of 40 days to as few as 10 days.  This reduction in time would dramatically limit the issues employers could raise in the pre-election process.  We previously reported on our blog that the ambush rule was no longer in effect because the Board lacked the proper quorum of members when it enacted it.  Now that the Board has the requisite number of members, it can simply vote to re-enact the ambush rule or put in place some other rapid election process.

Second, the Board will probably revisit the notion of micro-unit organizing.  In an August 30, 2011 ruling, the NLRB ruled that a union could seek to organize a group of nursing assistants, despite requests by the employer to include other employees in the unit.  This decision created new standards for the bargaining unit; an employer would have to show that excluded employees should be included.  Needless to say, it is much easier for a union to organize smaller groups of people.

As we said before, the new Board is likely to be extremely active in its rule-making and is seeking to advance union organization and union backed causes.

Bottom line – Take Action Now!

In regards to both the above mentioned changes from the Board, the best course for employers is to be proactive.  Employers should think about how to handle and respond to union organizing now!  Put in place an action plan to diminish the risks with union organizing. This plan includes supervisor training on how to maintain a non-union workforce, and perhaps even certain persuader activity to educate employees on the facts behind “union card check” and other union tactics. To combat micro-unit organizing, examine your company structure and evaluate all classifications of employees.  Finally, even those employers currently with a union workforce will continue to feel the impact of overwhelmingly pro-labor decisions impacting their ability to effectively manage.  Feel free to reach out to qualified labor counsel for special guidance unique to your operations.

NLRB Loses Challenge to Arizona Law Guarantying Secret Ballot Elections

Contributed by Terry Fox

Arizona citizens passed a state constitutional amendment in 2010 guarantying secret balloting in union elections. This citizen initiative was a response to the National Labor Relations Board’s  suggestion it would conduct “card check” elections despite the failure of the Employee Free Choice Act.  When that amendment took effect, the board sued in federal court for a judgment declaring the Arizona Constitutional Amendment was preempted by the National Labor Relations Act. 

The NLRB argued that it alone had the right to determine election issues, and that power was granted by the federal government.  Thus, it asserted the Arizona Amendment was contrary to the National Labor Relations Act because it gave Arizona State courts the right to determine issues in a union election conducted in Arizona. 

In the order issued by U.S. District Court Judge Frederick J. Martone, [2:11-cv-00913-FJM] the court found that the illegality of the Arizona Amendment could not be decided on the face of that amendment.  Instead, the court would require evidence of how, when, and where the Amendment would be invoked.  It pointed out that the NLRB has the discretion to exercise its jurisdiction in election disputes or not.  Arizona argued that its interests in a secret ballot election are “deeply rooted in local feeling and responsibility,” such that a balancing of interests is required to determine if state action offended the regulatory scheme imposed by the NLRA.  That, the court found, requires a factual context.  As such, the court denied the NLRB’s motion for summary judgment and instead entered summary judgment for the state of Arizona. 

Not surprisingly, the Arizona Attorney General Tom Horne issued a press release describing the decision as a “stinging rebuke to an outrageous National Labor Relations Board attack.” To avoid card-check elections organized or sanctioned by the NLRB, states may want to consider enacting similar legislation or constitutional amendment.  Interestingly, three other states passed amendment similar to Arizona’s, but the NLRB only targeted Arizona for litigation. The formal title of the case is National Labor Relations Board v. State of Arizona and Save Our Secret Ballot, et al.

NLRB’s Ambush (Quickie) Election Rule No Longer in Effect (for now…)

As we previously reported in our blog, the NLRB’s ambush (aka “quickie”) election rule went into effect on April 30, 2012.  The rule sought to dramatically shorten the time frame in which a union representation election will take place. In short, the rule limited the issues employers could raise in the pre-election process (i.e. determining which employees are considered supervisors, and which employees constitute an appropriate bargaining “unit” would no longer be permitted before the election took place) and significantly diminished employers’ ability to appeal unfavorable decision-making at the local board level. The net effect forced employers to counter union organizing campaigns in 14-21 days versus the previously set time frame of approximately 42 days. 

Yesterday, May 14, 2012, a U.S. District Court ruled that the NLRB’s Ambush Election Rule is invalid and no longer in effect because no proper quorum of members existed when the rule was voted on and passed.  U.S. Chamber of Commerce et. al. v. NLRB (D.C. Cir. 1:11-cv-02262). 

Effective immediately, NLRB election procedures revert back to how they had been prior to this April 30, 2012 rule making, which means employers can expect an approximate 42 day window before an election, as opposed to 14-21 days.  We expect the NLRB will likely appeal this decision. 

SmithAmundsen’s Labor & Employment Practice Group recently received one of the first quickie election petitions in the United States, and the new rule was indeed decidedly working against employers.  Unfortunately, this issue isn’t quite over… but this is a significant victory for employers who prefer to remain union free in whole or in part.  As always, more detail will follow as new developments arise.

NLRB’s “Quickie” Election Rule Effective Today – April 30, 2012

Contributed by Jeffrey Risch

Today’s the day that the NLRB’s controversial rule to dramatically shorten the time frame in which a union representation election takes place goes into effect. The new rule radically changes the procedures by which the NLRB administers the union election process in the private sector. Through this new rule, union elections will take place in roughly half the time that they have in recent decades.  

In short, the rule limits the issues employers can raise in the pre-election process (i.e. determining which employees are considered supervisors, and which employees constitute an appropriate bargaining “unit” are no longer permitted before the election takes place) and significantly diminishes their ability to appeal unfavorable decision making at the local board level. The net effect will force employers to counter union organizing campaigns in 14-21 days versus the current time frame of approximately 42 days.  

Readers can find more information about the new rule on the NLRB’s official website at:

Needless to say, this move is extremely controversial within the business community. Anticipating the move, on December 20, 2011, the U.S. Chamber of Commerce and the Coalition for a Democratic Workplace filed a federal lawsuit seeking to enjoin the NLRB from enforcing the rule.   

The rule was published in the Federal Registry on December 22, 2011 by Chairman Mark Gaston Pearce (D) and outgoing Member Craig Becker (D) without the agreement of Member Brian E. Hayes (R).   

Because of these new time restraints, employers (who prefer to remain union-free) should immediately contact their labor law counsel and discuss implementing an IMMEDIATE RESPONSE PLAN if and when a labor union petitions for recognition.  Despite legal actions filed to prevent this rule from going forward, this rule is in place for now…

SA’s Labor & Employment Law Group will keep its clients and contacts updated on any significant future developments.

Federal Court Allows New Labor Poster Requirement to Go Into Effect April 30, 2012

Contributed by Jeff Risch

Despite an aggressive and well coordinated legal challenge on behalf of the employer community, private employers subject to the National Labor Relations Act (NLRA) — which is just about every private employer – will soon be required to post written notice to its employees about their rights to organize and form labor unions.  A federal district court judge in Washington, D.C. ruled on March 2, 2012 that the National Labor Relations Board (“Board”) has the authority to promulgate and enforce a rule requiring most private employers to display the new poster entitled “Employee Rights Under the National Labor Relations Act” National Association of Manufacturers v. NLRB.

The rationale behind the bold maneuver by the Board centers on its belief that employees are simply unaware of their rights under federal labor law and employers should be required to inform them. The Board created its own rule on the subject under its statutory authority to adopt “such rules and regulations as may be necessary to carry out the provisions of [the NLRA].”

Fortunately for employers, the Board’s attempt to sanction employers who fail or refuse to post the required posting notice was declared unlawful by the federal district court. The Board attempted to harm employers who failed to display the poster by way of: (1) finding the failure to post the required notice to be an unfair labor practice (i.e. holding that such conduct would be deemed unlawful interference with, restraint, or coercion of employees in the exercise of their rights under the law); and (2) tolling the standard 6-month statute of limitations for filing unfair labor practice charges against employers that fail to post the notice.

However, the district court did not rule out the possibility that failure to post could be considered and used as evidence of an unfair labor practice: “[N]othing in this decision prevents the Board from finding that a failure to post constitutes an unfair labor practice in any individual case brought before it. But the ruling does mean that the Board must make a specific finding based on the facts and circumstances in the individual case before it that the failure to post interfered with the employee’s exercise of his or her rights.”

While other legal challenges still exist and are pending, this recent decision reminds employers to be ready to post come April 30, 2012.

Employers Beware of the Burden of Claiming Employees are Not Entitled to Back Pay Based on Their Immigration Status in an NLRB Hearing

Contributed by Sara Zorich

The National Labor Relations Board (NLRB) has raised the bar making it more difficult for employers to defend NLRB claims for back pay based on the affirmative defense that the employee is not authorized to work in the United States.  The NLRB recently held that an employer must articulate with particularity their basis for claiming that an employee is not entitled to back pay based on the employee’s immigration status and general assertions are insufficient to satisfy the employer’s burden.  (See Flaum Appetizing Corp et. al., 357 NLRB No. 162, Dec. 30, 2011).  In Flaum, the majority held that the employer was not entitled to discovery, the ability to subpoena documents or examine witnesses on the immigration status of the employees unless and until the company had submitted specific factual evidence in support of its position that the employees were not authorized to work in the United States.  Thus, employers should be aware that the NLRB will most likely require the employer to proffer extensive evidence of the employee’s alleged undocumented status prior to entertaining discovery on the issue.

Pro-Union NLRB Contradicts U.S. Supreme Court: Declares Employee Class-Action Waivers Violate Labor Law

Contributed by Jeff Risch

On January 3, 2012, the NLRB held that a nationwide home builder committed an unfair labor practice under the National Labor Relations Act (NLRA) by implementing a mandatory arbitration agreement that waived the rights of employees to participate in class or collective actions (D.R. Horton Inc. and Michael Cuda, 357 NLRB 184, 1/3/11). In short, the NLRB held that employers may not compel employees to waive their right to collectively pursue litigation of employment claims in all forums, arbital and judicial.

Michael Cuda, a superintendent for Horton, claimed that he and other similar superintendents for the company were prevented from pursuing a wage and hour class-action/collective-action under the Fair Labor Standards Act (FLSA); alleging that they were misclassified as exempt employees.  Horton required Cuda and other employees to execute an arbitration agreement whereby they individually agreed to forego class-action relief of all types relating to any employee dispute.  NLRB Chairman Mark Gaston Pearce (D) and Member Craig Becker (D) found that this mandatory arbitration procedure violated Section 8(a)(1) of the NLRA because it interfered with the statutory right of employees to engage in “protected concerted activity for their mutual benefit.”

In so holding, the NLRB took issue with the U.S. Supreme Court’s recent decision in AT&T Mobility LLC v. Concepcion, U.S., No. 09-893, 4/27/11.  In Concepcion, the court, in a 5-4 decision, enforced AT&T’s customer cellular telephone contract that provided for mandatory arbitration on an individual basis and prohibited class action proceedings despite conflicting California state law.  The court essentially held that the Federal Arbitration Act (FAA) preempts state laws that prohibit contracts from preventing class-action lawsuits.  In judicial decisions that have since followed Concepcion, courts throughout the U.S. have concluded that employees may waive class-action rights by agreeing to individualized arbitration through employment arbitration agreements.  

In distinguishing Concepcion, the NLRB held that employment arbitration agreements (unlike consumer contracts) cannot prevent employees from waiving their rights protected by the NLRA (i.e. collectively pursue wage/hour claims and/or disputes over terms and conditions of employment). The NLRB also reasoned that Concepcion involved a conflict between the FAA and a California state law, which implicated the U.S. Constitution’s Supremacy Clause; whereas in D.R. Horton the Supremacy Clause was not called into question as the issues involved purely federal statutes (FAA vs. the NLRA).