Labor: Labor law developments unfold before 2014 elections

President’s labor board struggles with GOP and legal resistance

At the end of July, the Senate voted to confirm all five nominees to the National Labor Relations Board, renewing Chairman Mark Gaston Pearce’s term through 2018 and setting the stage for an expected pro-labor advance by filling the remaining seats with two Democrats and two Republicans. The President appointed two pro-labor partisans, Nancy Schiffer, an AFL-CIO associate general counsel and card check proponent, and Kent Hirozawa, an advancing union guard who was chief counsel to Obama holdover chairman Pearce. The President’s appointment of non-objectionable management lawyers Philip Miscimarra and Harry Johnson gives big labor and its anti-business minions a long-awaited upper hand, which they surely wish to wield, ironically, like the proverbial fist inside the velvet glove.

At the top of the agenda will be moving the regulations for “quickie” representation elections forward and implementing them. Because the President’s promise of “card check” legislation fell on its face in 2010, even with Democratic control of both houses, the Obama Board will push hard to rule by regulation, repromulgating the quickie election rules in a stricter and strengthened format. Reissuing these rules with a full Board will remove any question about the legality of their promulgation and would be a token tribute to organized labor which has been actually banking on card check legislation since 2008. And depending on the Democrats’ performance in 2014, card check legislation, with its binding first contract interest arbitration, could rear its ugly head.

The full Labor Board may have to quickly repair damage to Board decision-making depending upon how the Supreme Court’s ruling in Noel Canning comes down. The 3rd and 4th Circuits, led by the District of Columbia Circuit, have held that the President’s 2012 recess appointments to the Board were invalid, placing in jeopardy the validity of approximately 1000 Board decisions. Should the Supreme Court agree with the D.C. Circuit’s decision, the new Obama Board would have to reissue the decisions, most likely leading to the same or an even better outcome for organized labor.  

The newly constituted Obama Labor Board will also target precedents that the labor movement has long criticized and overrule pro-business decisions handed down by the Bush Labor Board. This would include returning to precedent from the Clinton Administration providing “Weingarten” rights (i.e., the right of an employee to be represented during a workplace investigatory interview) to non-union employees as well as union employees. It also can be expected that the Obama Labor Board will continue define and address issues arising in the 21st century workplace. Thus, expect continued attacks on business by an activist pro-labor general counsel. The focus of prosecutorial energy will continue to be employee handbook policies and at-will employment disclaimers, email and social media use and restrictions, confidentiality and workplace investigation restrictions, and class action arbitration waivers.

This last issue, raised in the case of D.R. Horton, prohibits an employer from forcing employees to sign agreements waiving the right to bring class actions as a condition of employment. The decision and its reasoning create obvious tension with the federal policy favoring resolution of disputes through private arbitration. Not surprisingly, President Obama nominated Richard Griffin, one of the Board recess appointments who was challenged in the Noel Canning lawsuit, to become the Board’s chief prosecutor. Griffin will replace Lafe Soloman, the controversial, pro-labor attorney who served as acting general counsel for the Board since 2010.

The Board will also clarify its position on so-called “microunits” in representation elections. In Specialty Healthcare, the Board held that an employer who wants to challenge the exclusion of certain groups of employees from a proposed bargaining unit must show that excluded group has an overwhelming community of interest with the employees in the proposed unit. Management attorneys complain that the Specialty Healthcare reasoning leaves an employer vulnerable to numerous small units under one roof, where previously only one wall-to-wall unit would have been appropriate. Labor interests contend that employer criticisms are exaggerated.

With the 2014 House and Senate elections rapidly approaching, the Obama Administration and its Labor Board would like some immediate victories for organized labor. The Administration hopes that its labor agenda can make some concrete advancement before the election campaigns gain full speed and before its agenda can be used against them. Regardless of the temperament of the electorate, however, the Administration expects at least marginal progress because of the newly constituted full Board and its regulatory powers.

Contributing Author

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Mark Spognardi

Mark Spognardi is a partner at Arnstein & Lehr. He focuses on representing management in traditional and non-traditional labor and employment law matters, including counseling,...

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