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In this issue:

News and Analysis

The Good, the Bad and the Ugly

NEWS & ANALYSIS

Beware of NLRB Nominee Becker, Chamber of Commerce says. – The Senate has begun its four-week recess without taking any action on President Obama’s three nominations for the NLRB. The Democrat nominees are Craig Becker, associate general counsel for the SEIU, and Mark Pearce, who represents unions in private practice. The Republican nominee is Brian E. Hayes, a labor policy director for the Senate Health Education, Labor and Pension Committee. If confirmed, these nominees will join Democrat Board Chair Wilma Liebman and Republican Member Peter Schaumber on the Board.

Regardless of their respective political party affiliations, the newly constituted NLRB will be decidedly more pro-union, and significant changes in Board law and policy are anticipated. Although the senior Republican member of the Senate committee has called for a hearing on all three nominees, such hearings have historically been rare and are considered unlikely now.

Of particular interest is the Becker nomination. According to the U.S. Chamber of Commerce, the SEIU is one of the most aggressive unions in the United States, and “has a record of using questionable pressure tactics with the goal of forcing employers and workers to recognize unions without the democratic protection of secret ballot elections.” The Chamber believes the Committee should assess whether Becker’s role at the SEIU might prompt him to push to implement portions of the Employee Free Choice Act even if it is never enacted by Congress. Becker has written that the “core defect in union election law . . . is the employer’s status as a party to labor representation proceedings” and believes that “employers should be stripped of any legal cognizable interest in their employees’ election of representatives.” Becker also believes employers should be banned from virtually all NLRB proceedings related to organizing elections, even in cases of unfair labor practice charges. Becker has also argued that labor’s use of intermittent strikes to resolve grievances should be protected by the Board. According to the Chamber, “what is especially troubling” is that Mr. Becker “. . . appears to believe that such changes do not require Congressional approval, but could be implemented unilaterally by the Board even though they are in direct conflict with Board precedent and numerous court cases.”

Union must give hospital 10 days’ notice of workers’ refusal to work voluntary overtime. – Under Section 8(g) of the National Labor Relations Act, a union must give a health care institution 10 days’ written notice of any strike, picketing, or “other concerted refusal to work,” as well as the date and time that such action will begin. Housekeepers and linen aides at California Pacific Medical Center had a labor agreement providing that the Medical Center could not require overtime unless there was an emergency. Accordingly, the Medical Center normally asked for volunteers. The employees’ union was the Service Employees International Union, United Healthcare Workers-West.

After the Medical Center proposed a change in linen processing that the union believed would violate the contract’s prohibition on subcontracting, a majority of employees in the unit signed a petition protesting the proposal and authorized their shop stewards to designate one-week periods in which the employees would refuse to volunteer for overtime or extra shifts. The petition was presented to management with only four days’ notice, and, for seven days, every employee who was asked to work overtime declined to do so. A union newsletter published the same week said that the refusal was intended as a protest of the proposed subcontracting and to expose alleged short staffing.

The Medical Center filed an unfair labor practice charge, and an administrative law judge found that the union violated Section 8(g) by failing to provide the full 10-day notice of its concerted refusal to work overtime. The NLRB (then-Chair Battista and then-Member Kirsanow) agreed because the union had orchestrated the refusals to work overtime as a means to pressure the hospital to withdraw its proposal. Then-Member (now Chair) Liebman dissented, arguing that an employee’s refusal to work overtime should be considered a “concerted refusal to work” under Section 8(g) only when the overtime is mandatory.

In a decision issued August 3, 2009, the U.S. Court of Appeals for the Ninth Circuit agreed with the Board and the Medical Center. Speaking for the court, Judge Mary M. Schroeder wrote that the 10-day notice requirement “was intended to prevent disruption of patient care by giving hospitals time to plan ahead for strikes, pickets, or other work stoppages.” The union contended that because the hospital had agreed that each employee could decline to work overtime on a individual basis, the union could direct its members to decline to perform work on a collective basis, without engaging in a concerted refusal to work within the meaning of Section 8(g). In response, Schroeder said that there would not have been a “concerted” refusal if the employees had independently refused to volunteer for overtime. However, “[i]n this case, the Union itself called for the overtime work stoppage” and therefore the refusal to volunteer for overtime was “concerted” and implicated Section 8(g).

The union also argued that it could not have given proper notice unless it knew, at the time that notice was given, whether the hospital would need overtime on a particular day. The court rejected that argument, holding that the union could have provided 10 days’ notice “of the date when employees planned to begin declining overtime.” If the union had done so, the court said, “the notice would not have been rendered defective no matter how [the hospital] reacted, even if the hospital decided not to offer overtime on the specified date.”

D.C. Circuit nixes employer-friendly NLRB ruling on non-work solicitations. – Calling it a “post hoc invention,” the U.S. Court of Appeals for the District of Columbia Circuit has overruled part of the NLRB’s Register-Guard decision, which approved an employer’s ban on all non-work-related solicitations. The NLRB had found that the company’s policy was consistent with Board and court precedent governing employee use of employer-owned equipment, such as bulletin boards and telephones. Although the company had previously allowed non-work-related solicitations by individuals, the Board found that the company could lawfully ban solicitations by a union president on behalf of the union because the latter communications were made on behalf of an organization rather than an individual.

The D.C. Circuit, in Guard Publishing Co., d/b/a Register-Guard v. NLRB, disagreed. Judge Merrick Garland, writing for the court, noted that the policy itself did not distinguish between “group” and “individual” solicitations. Moreover, he noted, a warning to the union president said that he could not use company systems “for union/personal business,” thus “making it clear that the offense did not depend on whether an organization was involved.” Finally, he noted that the company had never invoked the distinction between groups and individuals before the unfair labor practice complaint was filed.

It is important to note that the union did not ask the court to address the Board’s ruling on the legality of maintaining such a policy, apparently believing that the NLRB under the Bush Administration and the D.C. Circuit were unlikely to find in its favor on that issue. However, it is very likely that the Board will revisit this issue in the future and reach a different decision as President Obama’s nominees join the Board.

“Full capacity” language in contract comes back to bite steel company. – AK Steel Corporation of Ashland, Kentucky, was a major supplier to General Motors Corporation and Chrysler Corporation. Devastating cutbacks by both automobile manufacturers, as well as the continuing global recession, rippled to AK Steel, which sought to shut down the Ashland plant for the last half of 2009 and lay off 750 employees. The United Steelworkers Union said “no,” filed a grievance, took the issue to arbitration, and won.

At issue was “full capacity” language that the company had agreed to in 2003 in exchange for union concessions on pension benefits. That language provided, in part, as follows:

The Company agrees that no plant covered by this Agreement will operate its facilities at other than full capacity, except during maintenance and repair outages . . . . The Company further agrees that its recent capital improvement at Ashland as well as the other commitments contained herein are designed to make the facility competitive. In the event that the Company has a need to supplement the plant’s product from a source outside of Ashland, the parties will meet to discuss such needs and duration.

The union argued that the company must keep its promise even if, in its judgment and in light of subsequent events, keeping the promise may be inefficient, uneconomical, impractical, inconvenient or not preferable.

The company argued that the Reserved Rights Doctrine applied, and that no provision in the labor agreement restricted its right to idle the Ashland operation when customer demand plummeted because of a severe economic downturn or when customer demands could not sustain the plant’s operations.

In ruling for the Steelworkers, the arbitrator found that the company had made an “explicit promise” to operate the plant at full capacity so long as there was customer demand for products made there and that the contract precluded the company from supplementing production from other plants owned and operated by the company unless Ashland was operating at full capacity. Steelworkers President Leo Gerard warned employers that the union would continue to enforce its contractual protections, no matter what market conditions are or how difficult economic times become.

THE GOOD, THE BAD AND THE UGLY

NYC Carpenters Union leaders are nailed for bribery scheme that cheated union members. – The head of the New York City Carpenters Union has been hammered with 29 counts of racketeering tied to an alleged $1 million bribery scheme that, among other things, caused union members to be deprived of their wages and benefits. The alleged scheme allowed contractors to pay union members in cash at below-union rates and without benefits; employ undocumented and non-union workers; and avoid payment to the union benefit funds in violation of collective bargaining agreements. Seven other union officials, a benefit fund trustee, and a contractor have also been charged.

The union defendants allegedly filed false shop steward reports, gave contractors advance notice of job site visits by union investigators, issued union cards to illegal aliens who worked for the contractors for cash, gave false testimony, and destroyed documents. The U.S. Attorney said in a statement, “Instead of protecting the financial interests of union members and their families, corrupt union officials and the contractor who bribed them are charged with betraying the Carpenters Union and its benefit funds to enrich themselves.”

Walmart Canada seeks to stop union’s “look-alike” anti-Walmart website. – As unions increase their use of the internet for organizing, Walmart Canada Corporation has struck back. Walmart has filed for an injunction against a website of the United Food and Commercial Workers Canada that is aimed at communicating with Walmart employees. Walmart says that the website violates trademark law through the use of phrases and images resembling those used by the company. A Walmart spokesperson said, “If they want to lobby or try to organize our associates, they need to be clear that they’re the UFCW . . . . Don’t use our brand name to do it!” Walmart’s application to the Quebec Superior Court seeks an order forcing the union to take down the website and a permanent injunction against the Union’s use of the words Walmart or Wal-Mart, color schemes used by Walmart Canada, expressions that represent altered forms of Walmart’s slogan and trademark, oral, circular, or semi-circular designs resembling those used by Walmart, or any acts that depreciate the value of Walmart’s registered trademarks.

The Union’s reaction to the filing was predictable. According to Wayne Hanley, national president of the UFCW Canada, Walmart’s attempt to block the website represents a “over the top” assault on freedom of speech and “a knee-jerk response” to the union’s attempts to freely communicate with Walmart employees. The union claims that “Walmart’s response to the success of [the website] is just another outrageous example of how the largest retailer in the history of the world will use its bottomless legal budget to manipulate the collective bargaining process and do just about anything to discourage its ‘associates’ from joining the union.”

Walmart’s effort to enjoin the website is not without legal precedent. A 2004 British Columbia Supreme Court ruling confirmed that the use of a trademark in a domain name not held by the trademark holder creates confusion by misrepresenting that the site is associated with the trademark holder.

Back in the USA, unions join forces to increase pressure on Walmart. – In 2005, the UFCW and the SEIU each formed separate organizations to pressure Walmart into “improving” its employment conditions. Recently, the unions launched “wakeupwalmart.com” to “maximize the ability for Wal-Mart workers to win a voice on the job and bring change to the entire retail industry.” According to SEIU President Andy Stern, the two unions believe the Walmart workers are “best served by a single organization dedicated to supporting Walmart workers and holding the retail giant accountable for its actions. Walmart has made a lot of promises to working families, and we plan to hold them accountable for making those changes.” Among other things, the new website accuses Walmart of committing wage-hour violations, and of supporting “hate speech” by not pulling its advertising from Glenn Beck after the Fox commentator recently asserted that President Obama had “a deep-seeded [sic] hatred of white people.” (Misspelling is the unions'.)

“If you thought we were a pain before...”: Trumka expected to succeed Sweeney as President of AFL-CIO. – AFL-CIO Secretary-Treasurer Richard L. Trumka has opened his campaign to succeed the retiring John Sweeney as president of the 8.5 million-member AFL-CIO. Trumka is expected to run unopposed and to be elected at the AFL-CIO convention in September. He appears to be reaching out to the unions in the Change to Win federation to unify the labor movement as soon as possible and to the next generation of workers “in a low-wage economy where temporary jobs are becoming more the rule than the exception, decent health insurance is rare and pensions are almost unheard of.”

To the politicians who work against workers and unions, Trumka said, “if you thought we were a pain before, you ain’t seen anything yet – its time for everyone we support to do right by American workers . . . . You can be for us, or against us – but you can’t be both, we won’t accept that any longer.”

UNITE HERE/Workers United “divorce” draws employer into criminal court. – In Constangy’s last Executive Labor Summary, we reported on an employer who was caught in a bargaining dispute because of the split between UNITE and HERE (“Am I here or at Dad’s this weekend?”). Now, Aramark Corporation, another “innocent bystander” employer, faces felony criminal charges as a result of the split between UNITE HERE and Workers United. Workers United contends that Aramark, which withholds employees’ union dues from their paychecks, is guilty of theft because it has not paid the dues to Workers United. The charges appear to be meritless at best, given that an Aramark spokesperson says that the company is remaining “firmly neutral in the dispute” between the two unions, is continuing to honor all collective bargaining agreements, and is holding the union dues in an escrow account for the disputed locations. Aramark says it will turn the money over to the union that lawfully represents the workers and is looking to the NLRB for clarification.

But that’s not good enough for Workers United, according to their president, Bruce Raynor: “Aramark does not have the right to take money out of workers’ paychecks and then do whatever it wants to do with it. We call that stealing. The money is the workers’. It is deducted solely for their benefit, and the company has no right to do anything but what the workers have directed.”

Workers United claims to represent more than 7,500 Aramark employees at its laundries and food service operations. Since June 2009, regional offices of the NLRB have dismissed 10 employer petitions for elections to resolve whether UNITE HERE or Workers United represents employees for bargaining purposes.

Just when you thought it was safe to fly again... – In a related dispute, Workers United has filed a petition with the NLRB seeking an election to determine whether Workers United or UNITE HERE represents 2,100 workers employed at 15 airports across the United States. Workers United claims that a new collective bargaining agreement between the employer and UNITE HERE, and recently ratified by UNITE HERE members, was a “backroom deal” that provides no improvements in wages or health care benefits. Workers United also contends that an elected contract bargaining committee or workers should have been included in the bargaining process.

Constangy, Brooks & Smith, LLP has counseled employers on labor and employment law matters, exclusively, since 1946. A “Go To” Law Firm in Corporate Counsel and Fortune Magazine, it represents Fortune 500 corporations and small companies across the country. Its attorneys are consistently rated as top lawyers in their practice areas by publications such as Chambers USA, Super Lawyers, and Top One Hundred Labor Attorneys in the United States. More than 100 lawyers partner with clients to provide cost-effective legal services and sound preventive advice to enhance the employer-employee relationship. Offices are located in Georgia, Florida, South Carolina, North Carolina, Tennessee, Alabama, Virginia, Massachusetts, Missouri, Illinois, Wisconsin, Texas and California. For more information, visit www.constangy.com.

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