The Trump administration’s push to roll back regulations on the corporate world has spanned across various agencies. But in the labor and employment realm, the regulatory shift is perhaps most distinctly felt from the National Labor Relations Board.
The NLRB is the federal government agency that enforces the National Labor Relations Act of 1935, which protects private-sector workers against “unfair labor practices” and guarantees their right to collectively bargain with their employers. The agency has also historically protected what it interprets as “concerted activity” among workers under the NLRA. What exactly constitutes concerted activity is one of many questions that the NLRB has answered differently depending on which political party holds the majority on its board.
With its first Republican-majority board in more than 10 years, the NLRB has been reversing the pronouncements of its Democrat-run predecessor. In December, the board issued a handful of employer-friendly decisions, which among other things made it harder for unions to organize smaller units of workers and clarified what type of policy change requires the employer to bargain with the union before making it.
But most notably, the board narrowed its definition of what it considers a joint employer, which affected whether a company could be held liable for the unfair labor practices of its franchisees, staffing companies and temp agencies. The board would however vacate the underlying decision in Hy-Brand Industrial Contractors, Ltd. and Brandt Construction due to a conflict of interest.
Many management-side attorneys say the current NLRB is just undoing the radical shifts of the Obama-era board and returning to longstanding precedent. Steve Gutierrez, a Holland & Hart partner in Denver who represents employers, said that some of the previous NLRB’s stances, such as its scrutiny of employee handbooks for lawfulness under the NLRA, “was pretty out there to begin with” and doesn’t see the current rollback of those policies as being extreme. “I was fairly amazed about the progressive nature of the Obama board.”
Regardless, the current NLRB’s agenda is clear, he said.
“I think they’re going to do everything they can to roll back every single thing in that [Obama] administration,” Gutierrez said. He added that the discourse on NLRA-related issues has become polarized and is “a reflection of our current political system.”
Stan Lubin, a Phoenix-based attorney with Lubin & Enoch whose work mostly consists of NLRB issues, said that the NLRB board’s roll back “is just starting, because it is now constituted of a majority that will agree with Trump.”
Former Morgan Lewis partner John Ring became board chair in April, joining Trump appointees Marvin Kaplan and Bill Emanuel who were sworn in last fall. The board still has two Obama appointees, Lauren McFerran and Mark Gaston Pearce.
HOW MUCH DO THE NLRB SHIFTS MATTER LOCALLY?
Where attorneys on either side of the bargaining table agree is that the political shifts at the top of the NLRB significantly affect employers and employees at a regional level. NLRB regional directors who oversee union elections have significant independence in how they handle their caseload and issue decisions. But parties can appeal those decisions all the way up to a more partisan board.
With the Republican majority board in place, Luben said he’s increasingly advising clients to hold off on filing certain charges with the board for now and to instead consider remedies in federal district court.
THE JOINT EMPLOYER ISSUE
One of the most wide-reaching NLRB issues remains the joint-employer standard, which determines whether a company gets tied in with the collective bargaining procedures or labor lawsuits of its subcontractors, franchisees, and other adjacent parties. In the 2015 decision in Browning-Ferris Industries, the board determined that separate entities are joint employers if one of them had the right to hire, fire or promote the other’s workers, regardless of whether it exercised control of those “essential terms of employment.”
The Trump-era board’s December decision in Hy-Brand overturned Browning-Ferris so a joint employer relationship would again require direct control over the other entity’s workers. But the board vacated its own ruling in February; board member Emanuel was formerly an attorney with Littler Mendelson, which was involved in the Browning-Ferris case, yet he didn’t recuse himself from the Hy-Brand decision.
But the NLRB is looking to alter the joint-employer standard through other means. In May, it announced it will promulgate a rule this summer to address the standard.
EMPLOYEE HANDBOOK POLICIES
Previously, the NLRB took action against companies whose employee handbooks had rules that could be interpreted as interfering with workers’ rights under the NLRA. These included rules against recording in the workplace as well as “workplace civility” rules that prohibited certain behaviors and speech among workers. Under the previous administration, the board was invalidating private employer’s handbook policies on the grounds that they violated NLRA Section 7 rights to concerted activity, and “much of what they rolled back was way too extreme,” Gutierrez said.
On June 6, NLRB General Counsel Peter Robb issued a memo softening the agency’s stance on the policies in employee handbooks. The memo outlines what types of policies are generally lawful under the NLRA, which ones require individualized scrutiny, and which ones a generally unlawful.
Luben considers this shift in employee handbook policy enforcement to be one to watch for worker’s rights advocates.
“Anything involving discussion of things that go on at work, beware, be careful, because now the general counsel is reaching for excuses to avoid going after employers who forbid them,” Luben said.
UNION ELECTION RULES
Gutierrez said that one of the most impactful issues before the new NLRB will be union election rules, particularly what employer attorneys have called the “quickie election rule.” In 2014, the NLRB shortened the election cycle, cutting the number of days required between a union petition and a union election. That shortened timeframe has made it more difficult for employers to mount their own campaign against unionization, Gutierrez said.
In December, the Board issued a Request for Information about possibly rescinding the rule. It had extended the comment period for the RFI to April 18.
IS THE BACK-AND-FORTH SUSTAINABLE?
As much as the current NLRB may issue rules and decisions that swing its standards more toward employers’ favor, it’s only a matter of time before the board majority changes parties again. It’s then an open question as to how long those standards last.
Luben said the NLRB’s swing back-and-forth is “not that different from what the Supreme Court is doing” with sharp reversals on major issues, albeit over a shorter period of time.
Gutierrez said the NLRB reversals may continue with each new administration, but the public may only tolerate such drastic changes for so long. “I don’t think our current political system is sustainable with the current acrimony between the parties,” Gutierrez said.
— Doug Chartier