September 2001 

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New Growth on an Old Vine:
Labor-Management Relations
and the NLRA

By Steven G. Rush

Despite its age, the NLRA continues to be a fertile source of litigation and new thinking. Recent decisions have redefined rights of nonunion employees, among others, and provide labor and management representatives alike with much to consider.

Recent decisions by the National Labor Relations board ("NLRB" or "board") have dramatically demonstrated how the National Labor Relations Act ("NLRA" or "act"), as amended, applies to all employers, not just those with unionized employees.1 A nonunion company that chooses to remain largely ignorant of developments under the NLRA acts at its own peril. For those workforces that are unionized, the NLRB has revisited and changed certain longstanding concepts that labor and management representatives will want to carefully consider. Employees and labor unions may want to review these changes with particular interest because the recent decisions of the NLRB have generally favored their respective interests.

The last few years have witnessed a relatively active board, often willing to consider challenges to well-established board precedent. For example, the NLRB recently ruled, reversing precedent, that a nonunion employee in an investigatory interview has the right to the presence of an employee representative.2 Similarly, the board reversed its thinking on contingent workers, finding that temporary workers may be included in a bargaining unit with permanent employees without employer consent and the supplier and user employers will have to bargain with a union concerning the jointly-employed contingent workers.3 Moreover, for half a century the board held that a unionized employer could unilaterally withdraw recognition from the union if it had a good-faith doubt that the incumbent union no longer represents a majority of the workforce. Overruling precedent, the board now asserts the employer may only unilaterally withdraw recognition on an objective showing that the union has lost the support of a majority of represented employees.4 Other recent NLRB cases demonstrate that work rules governing employee behavior (union and nonunion) must be drafted very carefully to avoid violating the NLRA.5 Finally, the United States Supreme Court has underscored the finality of labor arbitration decisions, even in the face of countervailing public policy concerns.6 These examples strongly suggest the importance of keeping up to date on the NLRA.

The NLRB issues administrative decisions concerning issues under the act, subject to judicial review. There are five seats on the board, four members were appointed by President Clinton and one seat is vacant. President Bush designated current member Peter J. Hurtgen as board chairman on May 15, 2001, and appointed Arthur F. Rosenfeld as general counsel to the board.

Steven G. Rush is legal counsel for Holiday Companies, practicing in areas of labor and employment, franchise, environmental law, and corporate compliance. Formerly a staff attorney at Dorsey & Whitney, he received his J.D. cum laude from the University of Iowa Law School.

"Employees and labor unions may want to review these changes with particular interest because the recent decisions of the <H>nlrb<P> have generally favored their respective interests."

Over 25 years ago, the Supreme Court held in NLRB v. J. Weingarten, Inc. that union employees had the right to the presence of a union representative in an "investigatory interview."7 The Weingarten Court concluded that a union employee's right to representation in an investigatory interview is founded in Section 7 of the act, which provides that "employees shall have the right to … engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection."8 The Court reasoned that the failure to allow the presence of a coworker in an investigatory interview would preclude employees from engaging in the above-described protected, concerted activity.

While Section 7 of the NLRA has been consistently applied to nonunion employees, the NLRB has taken an inconsistent approach applying Weingarten to that group. In 1982, the board found that nonunion employees enjoyed a Weingarten right, theorizing that such a result was supported by the language of Section 7 and the presence of a coworker may level the playing field between employer and employee.9 Three years after that case, the board again changed course, ruling in Sears, Roebuck & Co. that Section 7 did not compel the presence of a representative in the interview of a nonunion employee.10 Although the reasoning for Sears was later rejected, the board continued to deny the right to nonunion employees, reasoning among other things, that in the nonunion setting, the chosen representative would not have the skills of a union official to facilitate resolution.11

However, the NLRB recently overruled its precedent on this matter and held in Epilepsy Foundation of Northeast Ohio that Section 7 of the NLRA does afford a nonunion employee the right to a coworker in an investigatory interview.12 The board saw no practical difference between union and nonunion employees under Section 7 to act in concert for mutual aid or protection in an investigatory interview. Moreover, the presence of a coworker can possibly prevent unjust punishment in either setting.

The issue will present itself whenever an employee is called into an "investigatory interview." An investigatory interview is any meeting where the employee reasonably believes that disciplinary action could result. An employee, called to an interview with human resources concerning a matter that could result in discipline, will have sufficient basis to request a representative. Based on Weingarten and subsequent authority, the employee may then request the presence of a coworker representative. The employer is not required to postpone that interview in the absence of a specific representative if another representative is available. The employee who requests an opportunity to meet and confer in private with the representative before the interview should be allowed that opportunity if the interview is to take place immediately. Although not allowed to disrupt the interview, the representative would also have the right to confer with the employee and interject to clarify matters during the questioning. A nonunion employer that has never confronted this situation before is likely to be confused about its obligations and could easily violate the act by failing to abide by any of the foregoing requirements.

An employer is not required to advise either a nonunion or a union employee of this right. If the employee asserts the right, the Weingarten decision states that the employer has the following options:

1. Honor the request;
2. Decline to interview the employee; or
3. Advise the employee that he or she has the option of meeting with the employer without representation but that if the employee refuses, the employer will conduct its investigation without the benefits of the employee's input.

The employer should determine a uniform response that can be used when such a request is submitted and should avoid making the decision on a case-by-case basis. Different approaches to such a request could certainly give rise to a charge of unequal treatment. If the employer honors the request, a second management representative should also be present during the interview.

While the employer may decline to interview the employee, if the employee is discharged and commences litigation (e.g., a civil rights claim) a judge or jury is likely to view the failure to interview as unfair and may see it as a reason for finding the termination decision pretextual. The "unfairness" argument may be minimized if the employer has previously published its position on a Weingarten request to its employees. However, most employers will likely conclude they are better off not giving publicity to this right. An employer may quietly decide to choose the third alternative which at least gives the employee some ability to determine whether he or she is to have any input.

The presence of a coworker at the interview certainly affects confidentiality and privacy issues when a sensitive investigation is being conducted. For example, in a sexual harassment investigation, an employer will have a more difficult time maintaining confidentiality and sensitive facts may be disclosed to a wider audience. Moreover, the representative that the employee chooses may also be a witness that the company wanted to interview to conduct a thorough investigation. Both employees' testimony may then become tainted. Also, while the Weingarten progeny suggest that an employee may not choose a specific representative, further decisions may give nonunion employees this right under the theory that a nonunion employee should be able to choose since a trained union representative is not available to that employee. It is clear that the employer does not have the right to require that the employee choose a specific representative that the company favors. These issues should be examined by a prudent employer well in advance of an employee requesting the presence of a representative.

Another potential area for labor-management dispute lies in the increasing use of contingent labor in the United States. The board revisited the use of temporary labor in the context of union representation in the dual cases of M.B. Sturgis, Inc. and Jeffboat Division.13 In the typical scenario, one or more "supplier" employers provides temporary labor to a "user" employer. A labor union may attempt to organize a unit consisting of the supplier employer's temporary workers and the user employer's regular workforce. For many years, the NLRB had previously considered this a "multiemployer" bargaining unit which would require the consent of the supplier employer and the user employer.14 The board's reasoning was that an employer may not be required to bargain jointly with other employers under Section 8(b)(4)(A) of the act.

The board determined in M.B. Sturgis that such a scenario was not actually multiemployer and consent was not required. In the board's view, the situation was not truly multiemployer as all of the relevant employees were ultimately performing work on behalf of the one user employer. In order to find a bargaining unit consisting of temporary employees and regular full-time employees, the NLRB decided that only two issues were important. First, there must be a finding of joint employment of the contingent workers by the supplier and user employers. Joint employment is normally found when the parties share in the determination of essential terms and conditions of employment such as daily supervision, hiring, firing, compensation, etc.

Assuming joint employment is established, the board would then determine if the relevant contingent and permanent employees shared a "community of interest" to be part of the same bargaining unit. The "community of interest" standard has been discussed in numerous board cases. Basically, this involves an analysis of whether the employees have the same or similar interests in wages, benefits, hours, and working conditions.

Assuming an affirmative finding of joint employer status and that the employees share a community of interest, unrelated employers can be obligated to bargain with a union over the terms and conditions of the jointly employed employees. A nonunion employer that either supplies temporary labor or uses the same should take note of this decision.
In the Jeffboat case, the user employees were represented by a labor union and the union sought to represent certain of the temporary employees through a theory known as "accretion," even though the temporary employees had not been part of a bargaining unit. The board ruled that the supplier of the temporary employees could be forced to bargain with a labor union with which it had no previous history and without the benefit of potentially defending a union representation campaign. Moreover, the temporary employees could be forced to become part of a labor union without having had the opportunity to vote.

While these cases would appear to benefit labor unions, the employer in M.B. Sturgis urged the inclusion of the temporary employees during a union representation election. The employer presumably did this due to a perceived lack of union sympathy in the temporary workforce, thereby diluting the union's chances of success of receiving a majority vote. The union in M.B. Sturgis actually opposed the inclusion of the temporary workers.

The relationship of the user and supplier employers at the bargaining table could be problematic. There could be ambiguity over the relative responsibility of each employer as to certain terms and conditions of employment of the temporary workers. The user and supplier employers' interests may actually conflict, complicating the process of reaching agreement with the union or in conducting potential strike planning. Moreover, there could be a conflict of interest within the union ranks if the bargaining representative favors the permanent employees' interests over the contingent workers. This could be particularly acute in the situation where the former group is far larger than the latter.

Where a petition named a supplier employer and two or more unrelated user employers, M.B. Sturgis reaffirmed that consent of the employers would be necessary since this scenario would involve multiemployer bargaining.15 In this situation, the common employer (the supplier) is supplying labor to unrelated user employers. In contrast, where the user is the common employer of the temporary and permanent employees, in the board's view the jointly employed temporary employees are working for related employers on a single project. While this distinction may appear logical, this and other uncharted issues will only be resolved through further litigation.

A union becomes the bargaining representative of a group of employees in one of two ways: voluntary recognition by an employer or certification through an NLRB-supervised election. Similarly, the union may lose its status as the representative of the employees if an employer withdraws recognition or if an NLRB-sponsored election decertifies the union. In the situation where an employer withdraws recognition, the board had held in Celanese Corp. that an employer may withdraw recognition by showing either that the union has, in fact, lost majority support or that the employer has a good-faith doubt, based on objective evidence, of the union's majority status.16

Even though the Celanese rule has applied for half a century, the board overruled the case recently in Levitz Furniture Company.17 The board held that an employer may no longer withdraw recognition on the basis of a good-faith doubt of a union's majority status. Instead, an employer may only unilaterally withdraw recognition from an incumbent union when, through a review of objective evidence, it is determined that the union has actually lost the support of a majority of the bargaining unit employees.

The burden of proof is on the employer to prove the union's loss of majority support. A petition signed by a majority of the employees rejecting union representation may appear to satisfy this burden. However, if the employer withdraws recognition and the union files an unfair labor practice charge, the employer may fail to meet its burden of proof. For example, a number of employees may claim they were coerced into signing the petition. The board also clarified the standard for an employer to file what is known as an "RM" petition. An RM petition is filed by an employer who is attempting to decertify a union. Under Levitz, if an employer in good faith is uncertain as to the union's majority status, it may petition the board for an election. This standard is lower than unilateral withdrawal of recognition because even if the employer guesses incorrectly, it will not have acted illegally so long as it acted in good faith.

The board clearly wants employers to stop unilateral withdrawal of recognition and, instead, file an RM petition. The employer in Levitz argued that under board precedent the employer may be committing an unfair labor practice by not withdrawing recognition if it had a good-faith doubt as to the union's loss of majority status under Section 8(a)(2) of the act. However, the Levitz opinion specifically found that an employer who files such an RM petition but continues to recognize the union until the petition and election are resolved will not be committing an unfair labor practice.

"the board now asserts the employer may only unilaterally withdraw recognition on an objective showing that the union has lost the support of a majority of represented employees."

"the board reversed its thinking on contingent workers, finding that temporary workers may be included in a bargaining unit with permanent employees without employer consent …"

Employers usually assume that they have an almost absolute right to control conduct in the work environment. While an employer does possess relatively wide latitude, work rules cannot be imposed that interfere with the employee's Section 7 rights under the NLRA. For example, while it may seem perfectly reasonable, in the interest of confidentiality, to forbid employees from discussing their wages, such a rule has usually been found to be a Section 7 violation.18

Other rules prohibiting other types of employee behavior may seem perfectly reasonable but unlawfully impinge on Section 7 activity. For example, in Flamingo Hilton-Laughlin, the employer had work rules that prohibited, among other things, "using loud, abusive or foul language" and "making false, vicious, profane or malicious statements regarding another employee, guest, patron or the hotel itself."19 The board found the foregoing rules overbroad in that they impinged on an employee's right to engage in concerted, protected activity. Employees may engage in propaganda activity about an employer that can include "abusive" remarks about the employer incident to an organizing campaign. Even if the remarks are, as the board has said, "merely false," the rules cannot unlawfully intrude upon the protected activity of making critical remarks about management or the company. Accordingly, an employer should attempt to more narrowly define issues of misconduct that do not prohibit lawful propaganda about the employer.

Conflict between the NLRA and the Americans With Disabilities Act ("ADA") in the context of work rules was at issue in Lockheed-Martin Astronautics.20 This case involved a security guard informing some coworkers of a medical condition that prevented the employee from wearing a sidearm and handling classified trash. The other guards were concerned that the restrictions were a safety hazard or caused other employees undue hardship in performing extra work.

The guard with the medical issue became aware of the discussions and filed an internal complaint that the discussions were creating a hostile working environment under the ADA. The guards who were discussing the matter were interviewed and told to stop discussing the guard's medical condition and/or restrictions. At least one of the guards protested, arguing that the matter was grievable under the existing labor agreement.

The board found that prohibitions on discussion of the guard's medical condition and work restrictions were overbroad and unlawful under the NLRA. As discussion of the effects of the work restrictions directly related to discussion of working conditions, the employees were engaged in protected, concerted activity. The company vehemently argued it had an obligation under the ADA to prohibit potentially harassing behavior. The board acknowledged the point but countered that the prohibition on such discussions must be narrowly tailored to address speech that could be construed as harassing or retaliatory. Instead, the employer in this case imposed a sweeping prohibition on all discussions of the subject.

Of course the board did not, and probably could not, define the line between protected activity and potentially retaliatory or harassing behavior under the ADA. It remains to be seen how sensitive the EEOC would be to the Section 7 argument in response to a charge of harassment/retaliation. Thus, an employer investigating an employee complaint about coworker discussions of that employee's medical condition or work restrictions will have to respect Section 7 rights while avoiding the charge that it failed to take sufficient steps to remedy the ADA complaint.

The United States Supreme Court's consideration of a suit to overturn the decision of an arbitrator in Eastern Associated Coal Corp. v. United Mine Workers of America is instructive as regards the scope of arbitrators' authority.21 In Eastern, a truck driver tested positive twice for the use of marijuana. On both occasions, the employer attempted to terminate the employee and the employee was twice reinstated with loss of pay plus other conditions attached to his reemployment. After the second reinstatement, the employer brought suit to overturn the arbitrator's award.

Normally, the court will defer to the decision of an arbitrator unless the arbitrator acted outside the scope of the collective bargaining agreement or the award is contrary to public policy. There was no argument that the arbitrator exceeded his or her authority granted by the collective bargaining agreement since the document said only that an employee could be terminated for "just cause" without making any attempt to define that term.

The employer argued that reinstatement was at odds with public policy, citing the Omnibus Transportation Employee Testing Act of 1991 ("Testing Act") and regulations promulgated thereunder that required drug (and later alcohol) testing of certain employees, such as truck drivers, regulated by the Department of Transportation ("DOT"). The employer cited congressional findings that eradicating the use of illegal drugs in the transportation industry was of paramount concern for the nation. Moreover, certain provisions of the Testing Act provided for suspension of a driver who had driven under the influence of drugs. Accordingly, the employer argued reinstatement of the driver, who had tested positive for illegal drugs, was at odds with the Testing Act's mission of promoting a safe transportation system.

The Supreme Court rejected that analysis, finding that the Testing Act did not mandate termination of an employee who tested positive for illegal drugs. Moreover, the remedial portions of the legislation stressed rehabilitation of a safety-sensitive employee who had tested positive before that individual could return to work. In fact, the implementing regulations of the DOT stated that the employer and the covered employee should be left to determine whether or not the employee would be returned to work or terminated. In the instant case, the driver had been required by the arbitrator's decision to undergo drug rehabilitation, had been suspended for three months without pay, and was required to sign a letter of resignation to take effect if the driver tested positive on one more occasion. The employee was even ordered to pay the arbitration expenses of the employer and the union. Accordingly, the arbitrator's decision was consistent with the Testing Act and was therefore not contrary to public policy.

The lesson to be learned for both labor and management is that in the absence of a definition for "just cause" termination, an arbitrator has discretion in making that determination. At the bargaining table, the employer could certainly propose to define "just cause" termination to include testing positive for illegal drugs. If that definition were part of the agreement, the arbitrator would be compelled to uphold the termination. Of course, the union might have something to say about that. But such is the nature of collective bargaining.

Despite its age, the NLRA continues to be a fertile source of litigation and new thinking. These changes may come at the expense of those who do not keep updated on board decisions, particularly for those nonunion employers. While the decisions have largely been favorable for employees and unions, the Bush administration will likely select pro-management representatives to fill board vacancies. Regardless of the composition of the board, our federal labor laws are something that should not be ignored.

1 29 U.S.C. ¤¤ 141-187 (1994).
2 Epilepsy Found. of Northeast Ohio, 331 N.L.R.B. No. 92 (July 10, 2000).
3 M.B. Sturgis, Inc., Jeffboat Division, 331 N.L.R.B. No. 173 (August 25, 2000).
4 Levitz Furniture Co. of the Pac., Inc., 333 N.L.R.B. No. 105 (March 29, 2001).
5 12 Waco, Inc., 273 N.L.R.B. 746 (1984); Flamingo Hilton-Laughlin, 330 N.L.R.B. No. 34 (November 30, 1999); Lockheed-Martin Astronautics, 330 N.L.R.B. No. 66 (January 6, 2000).
6 Eastern Associated Coal Corp. v. United Mine Workers of America District 17, 531 U.S. 57 (2000).
7 420 U.S. 251 (1975).
8 29 U.S.C. ¤ 157 (1994). The full text of Section 7 reads: "Employees shall have the right to self-organization, to form, join or assist labor organizations, to bargain collectively through representatives of their own choosing, and to engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection, and shall also have the right to refrain from any or all of such activities except to the extent that such right may be affected by an agreement requiring membership in a labor organization as a condition of employment as authorized in section 159(a)(3)."
9 Materials Research Corp., 262 N.L.R.B. 1010 (1982).
10 274 N.L.R.B. 230 (1985).
11 E.I. Du Pont de Nemours, 289 N.L.R.B. 627 (1988).
12 331 N.L.R.B. No. 92 (July 10, 2000).
13 331 N.L.R.B. No. 173 (August 25, 2000).
14 Lee Hospital, 300 N.L.R.B. 947 (1990).
15 See also Greenhoot, Inc., 205 N.L.R.B. 250 (1973).
16 95 N.L.R.B. 664 (1951).
17 333 N.L.R.B. No. 105 (March 29, 2001).
18 Waco, Inc., 273 N.L.R.B. 746 (1984).
19 330 N.L.R.B. No. 34 (November 30, 1999).
20 330 N.L.R.B. No. 66 (January 6, 2000).
21 531 U.S. 57 (2000).