July 28, 2017

Private: Here We Go Again: The Not-so-fun Rollercoaster Ride Known as Labor Oscillation

ACSblog’s Symposium on Regulatory Rollback, Anne Lofaso

by Anne Marie Lofaso, Arthur B. Hodges Professor of Law, West Virginia University College of Law

*This is part of ACSblog's Symposium on Regulatory Rollback

Labor law is no stranger to polarization. The National Labor Relations Board – that New Deal federal agency established by Congress to enforce the National Labor Relations Act (the principal federal law to regulate relations between unions and private-sector employers) – has long been a prime battleground for political polarization. Starting with the Eisenhower Administration’s confirmation of Guy Otto Farmerlawyer for the Bituminous Coal Operators’ Association (a multiemployer bargaining association formed in 1950 to represent coal operators in negotiations with the United Mine Workers) – to serve as Chairman in the mid-1950s, the Board has oscillated among (mostly) reasonable policy choices within the interstices and ambiguities of the NLRA’s statutory language.

Last month, President Trump nominated Marvin Kaplan, a Kansan with extensive government (but no labor-litigation) experience, and William J. Emanuel, a Partner in the Los Angeles office of Littler Mendelson, to fill two vacancies on the National Labor Relations Board. On July 13, 2017, the Senate Health, Education, Labor, and Pensions Committee held confirmation hearings.  Their confirmation would return a pro-business, Republican-backed majority to the Board for the first time since the relatively halcyon days of George W. Bush’s presidency.

If history serves prescient, then we have much policy oscillation to expect.  The United States Chamber of Commerce recently published its game book for overturning ten Obama-era labor policies. This blog focuses on the following four targets, the Board’s 2015 representation-election rules, Browning Ferris Industries of California (BFI), D.R. Horton, and Purple Communications and discusses how their reversal would negatively affect American workers.

  • In mid-2015, the Board’s new election rules became effective. These rules, affectionately termed the ambush election rules by detractors, accomplished three goals.  First, they modernized Board procedures by allowing electronic filings and requiring employers to share available email addresses and phone numbers for eligible voters. Second, they streamlined Board procedures thereby reducing unnecessary litigation.  Third, they standardized Board election processes thereby making these procedures more transparent to the public.  Employers have criticized these rules, not for making government more efficient, but for holding elections too quickly.  Dissembling behind the idea of “fair election,” the Chamber of Commerce has called for repealing these administrative rules and replacing them with legislation mandating pre-election hearings and a thirty-five-day minimum campaign period. Rather than making the election process more just, these efforts insert arbitrary brakes on the election process so that employers have time to hold captive-audience speeches designed to frighten employees to vote against representation. 
  • In August 2015, the Board issued its BFI decision, where it returned to the common-law definition of employer to determine whether two or more firms are joint employers of a group of employees.  Relying on long-standing principles, the Board held that such firms are joint employers if the firms are employers within the meaning of the common law and they codetermine the employees’ essential terms and conditions of employment.  In returning to a common-law grounded definition, the Board aligned the joint-employer doctrine with other court-approved jurisdictional definitions such as those of employee and independent contractor.  Using hyperbolic and inflammatory phraseology in characterizing BFI as the American-Dream killer, critics have baldly asserted that holding those who meet the common-law definition of employer to their statutory duties will destroy the franchisor-franchisee business model.  The Chamber has urged a more restrictive definition of joint-employer, a definition that allows large corporations to escape labor law liability and can make collective bargaining impossible.
  • In D.R. Horton, the Board concluded that arbitration agreements, which require employees to waive their right to file class-action lawsuits, violate the National Labor Relations Act primarily because such agreements violate their Section 7 right to band together for mutual aid or protection.  Although the Fifth Circuit declined to enforce that aspect of the Board’s decision, subsequent circuit courts have split in their approval of the Board’s rule.  Earlier this year, in Epic Systems Corp.  v. Lewis, the Supreme Court granted certiorari on the question “[w]hether an agreement that requires an employer and an employee to resolve employment-related disputes through individual arbitration, and waive class and collective proceedings, is enforceable under the Federal Arbitration Act, notwithstanding the provisions of the National Labor Relations Act.”
  • In late 2014, the Board issued its long-anticipated decision, Purple Communications, which held that since “email [use] [i]s a common form of workplace communication” employees generally have a right under the National Labor Relations Act to use their work email to organize union activities. Once again, the Chamber has used hyperbolic language to criticize the opinion, characterizing email as “property” and the decision as forcing employers to pay for union organizing activities. 

Oscillation is an appropriate tool for administrative agencies to be responsive to the electorate.  But here, working-class people, including many union workers, empowered Trump.  The possibility that the Trump Board will betray those workers seems likely as he has nominated men who have worked against those interests.  If Trump truly wants to change business as usual in Washington, perhaps he should consider appointing neutral labor experts to the Board rather than those whose clients’ interests are opposed to the enforcement of workers’ Section 7 rights.