Union Bailout Update

It was apparent from the beginning that the new “Blacklist” rule instituted by Executive Order was nothing more than a handout to unions. A recent Teamsters blogpost confirms exactly how Big Labor plans to use this gift. To quote from the post:

Using the Order The Executive Order gives unions unprecedented new leverage against companies and institutions that contract with the federal government. Unless the Order or its implementing regulations are overturned by the courts (employers have promised lawsuits) or revoked by a future president (wonder who), unions should be able to significantly increase their bargaining power by the simple expedient of filing meritorious charges with the NLRB, OSHA, the EEOC, or the DOL. Consider a union that strikes an auto plant for a new contract. Soon after workers hit the bricks, the union president has the following conversation with the general manager: Morris, we are two weeks into this goddam strike and the company shows no sign of accepting a fair labor agreement. That is your prerogative, but I think you need to take a fresh look. For one thing, we have filed six ULP charges over the company’s failure to provide information, illegal surveillance, and intimidation on the picket line – and are getting ready to file three more. The NLRB investigator has indicated that he will be recommending complaints on at least four of our charges. You say that the NLRB is toothless but you are apparently unaware that the rules of the game have drastically changed. Under a new Order issued by the President, a federal contractor that incurs NLRB or other labor law complaints must report them to federal contracting agencies and face the prospect of losing existing and future contracts. Putting it plainly: unless you settle this strike within the next few days, and the union withdraws its charges, you are likely to be marked as a “repeat labor law offender,” one of the highest categories of wrongdoing under the President’s Order. Check this out with your hotshot legal team. Counting all of its divisions, this corporation has federal contracts in the hundreds of millions. Do you really want to jeopardize this pot of gold to save a few hundred thousand dollars in the union contract?

The 3rd Circuit has ruled in favor of micro-units (a la Specialty Healthcare), joining the 4th, 5th, 6th, 8th, and the D.C. Circuits in doing so. It appears that employers are going to have to live with the carving out of micro-units until such time that the composition of the NLRB changes or the board decides to apply a different framework. The board may be leaning toward making it easier for the union to secure financial records from an employer during contract negotiations. To date, there has remained a distinction about an employer claim of “inability to pay” versus a claim of “unwillingness to pay.” In the later case, the employer may only have been required to provide limited data related to comparisons with competition. However, in the recent Wayron decision, the board telegraphed the possibility of removing this distinction.

In another case of mission creep, outgoing NLRB member Hirozawa attempted in a footnote to a recent case to open the door to an obligation to bargain with minority unions on a members-only basis. Although the case in question did not deal with minority unions, but with whether an employer has to deal with a decertified union on grievances that arose before the union was decertified, it is another example of union-friendly board members looking for any possible opportunity to get the camel’s nose in the tent. How long it takes this view to gain traction is anybody’s guess. Arbitration for gig-economy employers and employees gained a small boost as a federal appeals court handed Uber a victory in its class action lawsuit with drivers in California and Massachusetts.  The issue of mandatory arbitration provisions in employment contracts may make its way to the Supreme Court, as three appellate courts have upheld them while two have held them illegal. Earlier this month the NLRB requested the Supreme Court to rule on the matter. Although governmental officials (NLRB members, ALJ’s and court justices) typically take a timid approach to Big Labor intimidation tactics, apparently a jury of peers isn’t quite so gutless. The SEIU lost a $5.3 million defamation lawsuit against Professional Janitorial Services in a Houston court last week. The union launched a “Kill PJS” campaign, employing a strategy of media collaboration, baseless lawsuits, and union-planted employees in an attempt to pressure the company to accept recognition of the union without a vote by employees. In another set back to typical Big Labor shenanigans, UNITE HERE was ordered to repay $5.5 million in excess assets to Greenbrier Hotel Corp. that it tried to steal via sleight-of-hand revisions to a health plan. On the state level, Michigan has introduced a bill to take Right To Work one step further. The Worker’s Choice bill would allow non-represented employees to negotiate for themselves vs. having to have a union that they do not belong to represent them. If passed, it will be the first such law, and may set a template for other states to follow. In California, the state Assembly passed legislation to extend overtime pay to the state’s 825,000 farmworkers. It remains to be seen if the laborers, and the union that represents them, have shot themselves in the foot as their employers make adjustments to remain competitive.