On January 20, 2022, the U.S. Department of Labor’s Bureau of Labor Statistics reported that union membership in the United States had dropped to a historic all-time low. The decline in membership is prompting unions to consider strategies to replenish their depleted ranks with new dues-paying members. Against this backdrop, the National Labor Relations Board’s (NLRB) recent flurry of invitations to file briefs in connection with the reconsideration of existing case law precedent is worthy of close evaluation. Case precedent that appears to be on the Board’s chopping block includes, but is not limited to (1) the legal standard for determining independent contractor status under the National Labor Relations Act (NLRA), (2) the analysis for whether employer work rules violate section 8(a)(1) of the NLRA, and (3) the standard to determine whether confidentiality requirements in mandatory arbitration agreements unlawfully infringe upon employees’ Section 7 rights.
The Board’s decision to accept written submissions on these issues is not an academic exercise. Rather, employers can most certainly expect a myriad of changes broadly impacting labor-management relations. NLRB General Counsel (GC) Jennifer Abruzzo also announced numerous initiatives that would make it easier for unions to organize, dramatically enhance the penalties imposed upon employers in connection with labor law violations, and expand enforcement of alleged unfair labor practices, including the development of new theories of employer liability under the NLRA and new proposed remedies.
The Board’s agenda is consistent with the perspective that unions and unionization require maximum support, that current labor laws are inadequate, and that immediate intervention is required to level the playing field. Thus, several of the Board’s initiatives focus on (1) increasing union membership through expanding the definition of “employee” and (2) curtailing employers’ ability to promulgate and enforce policies that regulate employee activities at work. Given organized labor’s continued membership decline, it remains to be seen whether the Board’s initiatives alone or in combination will reinvigorate the labor movement.
Creating New “Employees” to Organize
Modifying the test for independent contractor status provides unions with a new target group of “employees” to organize. This includes gig economy workers, owner-operator truck drivers, and other workers who individually determine their own economic terms, conditions, and futures. The current NLRB seems to believe that unionization is a “public good” and that individuals need the protections only a union or the Board can provide. This is, of course, a value judgment with which many independent contractors might disagree. In fact, many workers become independent contractors precisely because they do not want to be employed by someone else. The general counsel already issued a memorandum asserting her belief that student-athletes are statutory “employees” under the NLRA and entitled to join unions, pay union dues, and bargain collectively, among other things. Other groups of nontraditional “employees” that unions would like the chance to organize include teaching and research assistants at private colleges and universities and temporary workers, among others.
Employer Work Rules Under Scrutiny
The Board’s focus on whether employer work rules violate section 8(a)(1) of the NLRA reflects the fundamental belief that even seemingly innocuous rules might hinder employees in the exercise of protected labor law rights. Several years ago, the Obama Board issued several decisions concluding that garden-variety work rules and policies addressing anti-harassment, regulating social media, prohibiting workplace recordings, requiring mutual respect among coworkers, and maintaining confidentiality during workplace investigations, as well as certain arbitration agreements, were unlawful. Many employers reacted by rewriting their employee handbooks and policies to avoid potential legal entanglement. The Board’s December 2017 Boeing decision established a more reasonable and predictable set of criteria for evaluating employer work rules. By issuing the invitation to file briefs on the issue, the new NLRB seems poised to overturn Boeing in favor of a hyper-technical analysis that will increase the likelihood that employer policies will be found to violate the NLRA.
Even casual observers can conclude that the NLRB’s recent actions strongly indicate the newly constituted Democratic-majority Board and the NLRB’s general counsel intend to make significant changes to labor law precedent. By all accounts, the “good old days” may be now for organized labor.
The business community may want to prepare to devote time and resources to address these union-friendly changes. NLRB decisions are not self-enforcing, and employers faced with an adverse Board decision may be compelled to seek review of the decision in a federal appellate court. Federal appeals courts have the authority to overturn NLRB decisions that are inconsistent with the NLRA or otherwise not supported by the facts or applicable law, and they have not hesitated to do so in appropriate circumstances.