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In this Issue:

News and Analysis

The Good, the Bad and the Ugly

By Bob Lemert
Atlanta Office

NEWS & ANALYSIS

NLRB says crude and allegedly threatening statements are protected activity. About two weeks before a decertification election at a warehouse with seven male and five female unit employees, three union newsletters with handwritten statements were found in the employee breakroom. The handwritten statement on one newsletter read, "Dear Pus**es, Please Read." The statement on a second newsletter read, "Hey cat food lovers, how's your income doing?" The third newsletter bore the statement, "Warehouse workers, RIP."

When several female warehouse workers complained that the statements were vulgar, offensive, and threatening, the employer began an investigation. One woman recognized the handwriting. The accused writer, a man, initially denied having been involved but eventually admitted it. He was suspended and later discharged for both the comments and initially lying about his involvement. The union filed an unfair labor practice charge, but an administrative law judge found that neither the investigation nor the employee's suspension and discharge violated the National Labor Relations Act. The Acting General Counsel appealed that decision to the National Labor Relations Board.

A three-member panel of the Board (Members Brian Hayes, Richard Griffin, and Sharon Block) agreed with the ALJ that the investigation itself was lawful, but Members Griffin and Block found that the employee's suspension and discharge violated the Act. The majority concluded that the employee was engaged in protected union activity when he wrote the three statements, so the only issue was whether his comments were so egregious as to cause him to lose the protection of the Act.

The majority analyzed the case under the four-factor test set forth in Atlantic Steel Co. Under Atlantic Steel, the Board considers 1) the place of the discussion; 2) the subject matter of the discussion; 3) the nature of the employee's outburst; and 4) whether the outburst was provoked by the employer's unfair labor practice. With regard to the first factor, the Board considered the employee breakroom an appropriate place for employees to distribute union-related literature and to discuss union-related matters. The Board agreed with the ALJ that the subject matter of the discussion – the employees' faltering support of the union – weighed strongly in favor of a finding of protected activity. With regard to the nature of the outburst, the majority concluded that the employee's comments were "essentially impulsive" and not "premeditated." Although the majority recognized that the word "Pus**es" was vulgar and could reasonably offend other employees, it noted, "In addition to serving as a crude anatomical reference, the term is also commonly employed to refer to weak or ineffectual person – someone who is not a 'man.'" Moreover, the majority noted that the comment was made at a workplace where profane speech had previously drawn only minor reprimands from supervisors. Regarding the "Warehouse workers, RIP" comment, the Board found no reason to interpret the comment as threatening death or physical harm because it was not accompanied by any physical or otherwise threatening conduct. Instead, the Board said, the statement should be treated as a figure of speech suggesting that the workers were "sowing the seeds of their own ruin." Finally, as to the fourth factor, the Board found there was no employer misconduct that provoked the employee's comments. According to the Board majority, taken together, the balance of all four factors "strongly" favored a finding that the employee did not lose the protection of the Act.

Republican Member Hayes wrote a brief but strong dissent. He specifically disputed that "greater latitude must be accorded to misconduct occurring in the course of organizational activity than for other Section 7 activity," and "that profanity in the course of labor relations is the presumptive and permissible norm in any workplace." (Emphasis in original.) Hayes also said, "I disagree [with the majority] that an employee has a protected Section 7 right to lie about alleged sexual harassment during a lawful investigation in order to conceal participation in union activity."

Court enforces NLRB decision allowing union access to information about non-union employees. An employee of a New Mexico utility was responsible for collecting overdue bills. After he became angry at an obstinate customer, he drove to the customer's house and disconnected the customer's gas line. As it turned out, the customer's gas service was provided by another utility. Even though the employee owned up to his actions, he was discharged for violating the company's ethics policy, as well as state law. The union grieved the termination, theorizing that the employee might have been treated more harshly than other employees guilty of similar offenses. Although the union had no evidence to support its theory, it made a request for documents showing whether, and to what extent, the company had disciplined other employees for similar offenses, including two non-union supervisors who had also violated the employer's ethics policy and state law.

The company agreed to provide information regarding disciplinary actions taken against union employees but refused to provide similar information about non-union employees. The union filed an unfair labor practice charge, and on the eve of the hearing, the company turned over the information about non-union employees. Nonetheless, an ALJ found that the delay violated Sections 8(a)(1) and 8(a)(5) of the NLRA.

The NLRB upheld the findings of the ALJ, and the employer petitioned for review by the U.S. Court of Appeals for the Tenth Circuit. The only question before the court was whether the disciplinary information about non-union employees was relevant to the union's processing of the grievance. The court acknowledged that non-union employees are not always relevant comparators with their unionized counterparts, but found that the particular reason for the employee's termination – the company's ethics policy – applied to union and non-union employees equally. Moreover, according to the court, the union had explained the relevance of the information in a letter to the company. Accordingly, the court denied the employer's petition for review, and enforced the Board's order.

Another social media policy bites the dust. Drawing from the Board's recent Costco decision, ALJ Clifford H. Anderson found that an employer's social media policies, handbook statements, and rules of conduct had a chilling effect on employees' Section 7 rights. The ALJ ruled that the portion of EchoStar's social media policy that prohibited employees from making "disparaging or defamatory comments about EchoStar, its employees, officers, directors, vendors, customers, partners, affiliates, or our, or their products/services" would chill a reasonable employee's exercise of his or her Section 7 rights, even though the policy cautioned employees to "remember to use good judgment." The ALJ also found that prohibiting employees from using personal social media on "company time" violated Section 7, because the term "company time" did not clearly convey to employees that they could use personal social media on breaks, during lunch, and before and after work.

The ALJ also found that the company's "contact with media" and "contact with government agencies" policies violated the Act, because they said that employees could not have such contact without "prior authorization from the Corporate Communications Department." EchoStar argued that it would be obvious to a reasonable employee that the rule applied only to contacts directed to the company, and not to the employee as an individual, but the ALJ concluded that "a reasonable employee would have been left in doubt about what the employee could or could not do under the rule and that doubt would chill that employee's unfettered exercise of Section 7 rights."

A confidentiality provision in the "Investigations" section of the employee handbook was also found to chill employees' Section 7 rights, because the ALJ said that employees would reasonably understand the rule to be a complete prohibition on discussing or disclosing information about the company's internal investigations. Finally, the ALJ addressed the handbook's rule against "insubordination," which the handbook defined as the "refusal to follow a reasonable work directive or undermining the Company, management or employees." (Emphasis added.) The ALJ said that the second part of the handbook definition broadened the definition of "insubordination" beyond its meaning in the English language and "create[d] a 'Frankenstein definition within the rule that creates a new word form.'"

Grievant is deceased, but company must go forward with arbitration, court says. Reversing the decision of a federal district court, the U.S. Court of Appeals for the Eighth Circuit has ruled that an employer must arbitrate the alleged wrongful discharge of an employee who died in an automobile accident five days before his arbitration was scheduled to take place. The court noted that the labor agreement did not exclude from arbitration the claims of a grievant who died before arbitration proceedings began. Moreover, the agreement provided that, if the supervisor and the employee failed to resolve a grievance, the union took control of the process going forward; accordingly, the "parties" to the arbitration were the employer and the union, and not the discharged employee.

Roundup of other recent NLRB developments previously covered by Constangy:

   • NLRB clubs Costco social media policy
   • Car dealership must "cease and desist" from requiring courteous
    behavior, NLRB rules
   • The end of common sense? NLRB decision on off-duty access
    leaves employers in a bind
   • Eleventh Circuit tosses NLRB finding on "supervisor" status

THE GOOD, THE BAD AND THE UGLY

AFL-CIO calls for boycott to end sweet lockout. Bloomberg BNA reports that the AFL-CIO has called for a nationwide boycott of American Crystal Sugar Company products to counter the company's 14-month lockout of 1,300 workers at five of its processing plants. The workers are represented by the Bakery, Confectionary, Tobacco Workers and Grain Millers Union. The lockout began in August 2011, one day after the union rejected a five-year contract proposal. Although the proposal offered the workers a 14 percent wage increase over the five-year period, as well as a $2,000 signing bonus, it also made changes (subsequently modified) to the workers' health insurance coverage that would increase their out-of-pocket expenses. In August 2012, AFL-CIO President Richard Trumka sent a letter to the 177 members of Congress who accepted campaign contributions from American Crystal, asking them "to use their influence and stature to insist that the company resolve this dispute immediately and end the lockout." In September 2011, the NLRB had dismissed a BCT unfair labor practice charge alleging that the company had failed to bargain in good faith.

Solomon accused of ethics violations. As Constangy's blog Employment & Labor Insider reported in September (links to source material are in the blog post), the inspector general for the NLRB has issued a report accusing Acting General Counsel Lafe Solomon of violating government ethics rules in a case involving Wal-Mart. When Solomon's mother died in July 2011, he inherited approximately $18,000 in Wal-Mart stock. At a January 23, 2012 meeting to review an advice memorandum instructing Region 11 to issue a complaint alleging that Wal-Mart's social media rules were overly broad and unlawful, Solomon made a decision that further work was needed before a decision on the merits could be made. Consequently, Solomon directed the Division of Advice to seek a resolution with Wal-Mart that would result in dismissing the charge. On January 30, Solomon informed the Board's designated agency ethics official that he had inherited the Wal-Mart stock, and requested a waiver to participate in the Wal-Mart case if it did not settle and was presented to him to decide whether to issue a complaint. The request for a waiver was denied, but Solomon did not inform the Division of Advice. On February 27, Solomon sold his Wal-Mart stock. In May, Solomon announced that Wal-Mart had avoided an unfair labor practice by adopting a lawful social media policy. Solomon took the position that his participation at the January 23 meeting did not constitute "personal and substantial participation"; however, the inspector general found that his actions at the meeting were clearly "not perfunctory, administrative, or peripheral; they are rather very central to issues of how the Agency was to proceed with the case against Wal-Mart."

GOP lawmakers file briefs attacking Obama's recess appointments. Bloomberg BNA reports that House Speaker John Boehner (R-Ohio), Senate Minority Leader Mitch McConnell (R-Ky.), and 41 Republican senators, filed an amicus curiae ("friend of the court") brief with the U.S. Court of Appeals for the District of Columbia Circuit challenging President Obama's January "recess" appointments of Sharon Block, Terence Flynn and Richard Griffin. (Flynn has since resigned from the Board.) The brief claims the appointments are unconstitutional and invalid because the Senate was in session (technically, at least), when the appointments were made. Boehner also argued in a separate amicus brief that, because the House and Senate never agreed to a recess in the manner required by the U.S. Constitution, the President lacked authority to make the appointments without Senate approval.

The case for which the briefs were filed is Noel Canning Div. of Noel Corp. v. NLRB, in which the employer is asking the court to set aside an unfair labor practice decision on the ground that Block and Flynn were on the three-member panel that decided the case.

Oral agreement and past practice support card check procedure, court says. In Rite Aid of New Jersey Inc. v United Food & Commercial Workers Union Local 1360, the U.S. Court of Appeals for the Third Circuit ruled that an arbitrator had authority to decide that the pharmacy chain breached an oral "recognition" agreement with a UFCW local. The parties' first labor agreement, executed in 1999, contained a clause that extended union recognition at stores within the Local's jurisdiction, including "all stores added to the union via [NLRB] elections or other demonstration of the Union status acceptable to [Rite Aid]." Subsequent agreements in 2002 and 2005 included the same language. However, before Rite Aid signed the original 1999 contract, it orally agreed to recognize the union in any store in the union's jurisdiction if the union proved, by authorization cards, that a majority of the employees wanted representation. Between November 1999 and December 2002, the union used the card check process to secure recognition at 63 stores. In return, Rite Aid became a prescription provider for a union health and welfare fund. Then, in 2003, Rite Aid replaced its Director of Labor Relations and began refusing to recognize the union based on card checks. The union filed a grievance, and an arbitrator found in favor of the union. Rite Aid challenged the arbitrator's decision in court, and when the case reached the Third Circuit, the court upheld the arbitrator's award. According to the court, the award "draws its essence" from the labor agreements when "viewed in the context of both the card check agreement and the parties' course of dealing."

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