Member Article

The Obama-appointed NLRB has now issued its first significant batch of decisions¹ serving notice, as is typical in the transition from one administration to the next, of a shift in the interpretation of the labor laws. The decisions include a new standard regarding secondary boycotts and union bannering; potential reconsideration of prior precedent; and a differing application of the law to facts than the predecessor NLRB. As a consequence of these decisions (and those anticipated in the future), employers should prepare to adapt to changes in the labor law environment.

The Bannering/Secondary Boycott Case

In a case of first impression, United Brotherhood of Carpenters and Joiners of America, Local Union No. 1506, 355 NLRB No. 159 (2010), the NLRB expanded the economic weapons available to a union and narrowed the protections available to a neutral caught in the middle of a labor dispute. The Carpenters’ Union had long running disputes with four specialty construction employers that were non-union and had allegedly failed to pay prevailing area standards. To protest, the Carpenters displayed 15 x 4 foot banners near the entrances of neutrals, including a hospital and a restaurant, that were customers of the construction employers. The banner did not name the construction employers but, instead, referred only to the neutral customers. For example, at Northwestern Hospital, where one of the contractors was working, the banners stated in large letters “Shame on Northwestern Hospital” and in smaller letters on the side “Labor Dispute.” In each instance, the banner was aimed outwardly at the public and was not accompanied by other conduct, such as carrying of signs, patrolling, or attempted blocking of ingress and egress. Based on these facts, the NLRB concluded that the display of the banner was not coercive—a requisite for violation of one of the law’s secondary boycott provisions. Had the Carpenters’ Union picketed at these locations, carrying picket signs with the same language, it likely would have been a violation of the Act. According to the Board, however, the display of the banner did not constitute picketing, but was more akin to lawful handbilling. Therefore, the secondary boycott provisions of the law were inapplicable. The potential ramifications of this decision are far reaching. Neutrals targeted by bannering may be without a remedy, even when the bannering interferes with their businesses. Moreover, contractors of the type involved here will likely face the prospect of not being able to continue with projects subject to bannering unless they meet union demands.²

Prior Decisions to be Reconsidered

The Board also granted review and invited interested parties to file briefs in two cases in which it will consider overruling precedent concerning a rival union or decertification petition challenge to an incumbent union’s support.

One of the cases, UGL-UNICCO, 355 NLRB No. 155 (2010), involves a new employer’s acquisition of a unionized business where it recognized the union, but did not assume the contract. The current rule, adopted by the Bush Board in MV Transport, 337 NLRB 770 (2002), is that the new employer’s recognition of the incumbent union will not bar an otherwise valid decertification petition or other challenges to the union’s majority status. Before MV Transport, the successor bar rule, set forth in St. Elizabeth Manor, 329 NLRB 341 (1999), had governed. Under this rule, a voluntarily recognized union was granted a reasonable period of time for bargaining without challenge to its representative status. The Board, by granting review in UGL-UNICCO, will be considering whether the successor bar rule should be reinstated.

In the second case, Rite Aid Store #673, 355 NLRB No. 157 (2010), the Board is considering whether precedent set by the Bush Board in Dana Corp., 351 NLRB 434 (2007), should be overturned. In Dana Corp., the Bush Board (over the vigorous dissent of Member, now Chairman, Liebman) overruled a nearly 40-year-old decision holding that a contract entered into after a union has been voluntarily recognized would bar the filing of a decertification petition. Under the rule in Dana, a decertification petition would not be barred (regardless of whether a contract had been entered into) for up to 45 days from the date of posting of an NLRB specified notice of voluntary recognition. Dana further required that the notice advise employees of their right to file a decertification petition within 45 days of the date of the NLRB notice, and specified that the failure to provide such notice would enable a challenge to the union’s majority status at any time.

The decision to grant review in these two cases is illustrative of the obvious willingness of the Obama Board to reconsider Bush Board decisions and to likely come down differently on purely policy grounds. In addition to these two decisions, the new Board will likely consider whether to reverse other precedents as well.³

Differing Application of Law to the Facts

Another observable shift in the Obama Board decisions concerns how the Obama Board views case facts and how it applies the law to those facts. Conduct that might have previously been considered lawful may now become unlawful in the Obama Board’s view, as represented by the following examples.

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¹ The Obama NLRB has experienced some delay in issuing decisions as a result of: (a) events that occurred in the last year of the Bush administration that left the NLRB reduced to two members, resulting in only non-controversial decisions being considered which led to a build up of a back log; (b) the time the Obama administration used to place its nominees in place based on a host of circumstances; and (c) the need to deal with the backlog caused by the Supreme Court’s decision in New Process Steel, which found that the two member Board acted without authority under the NLRA and invalidated approximately 600 cases issued in the last year of the Bush administration and in the first year of the Obama administration. New Process Steel v. NLRB, 130 S.Ct. 2635 (2010).
² After the decision in United Brotherhood of Carpenters and Joiners of America, Local Union No. 1506, the Board has similarly concluded in several other cases that bannering was not unlawful. See Carpenters Local No. 1506 (Associated General Contractors of America), 355 NLRB No. 191 (Sept. 22, 2010); Carpenters Local No. 1506 (Marriott Warner Center Woodland Hills), 355 NLRB No. 219 (Sept. 30, 2010); and Southwest Regional Council of Carpenters, 355 NLRB No. 216 (Sept. 30, 2010).
³ For example, in Hacienda Hotel, Inc. Gaming Corp., 355 NLRB No. 154 (2010), the Board has suggested that it may change the rules regarding an employer’s duty to honor a dues check-off clause after contract expiration. The Hacienda decision was before the Obama Board on a second remand from the Court of Appeals. The Board split 2 to 2 (with Member Becker not taking part in the decision due to recusal), which meant that the underlying complaint was dismissed. Nevertheless, Chairman Liebman and Member Pearce, in a joint opinion, disagreed with the remanded decision of the Bush Board and suggested that the normal rules restricting unilateral change without bargaining should be applicable to dues check off even though the labor agreement may have expired.