[Federal Register Volume 84, Number 155 (Monday, August 12, 2019)]
[Proposed Rules]
[Pages 39930-39958]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-17105]
[[Page 39929]]
Vol. 84
Monday,
No. 155
August 12, 2019
Part III
National Labor Relations Board
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29 CFR Part 103
Representation--Case Procedures: Election Bars; Proof of Majority
Support in Construction Industry Collective-Bargaining Relationships;
Proposed Rule
Federal Register / Vol. 84, No. 155 / Monday, August 12, 2019 /
Proposed Rules
[[Page 39930]]
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NATIONAL LABOR RELATIONS BOARD
29 CFR Part 103
RIN 3142-AA16
Representation--Case Procedures: Election Bars; Proof of Majority
Support in Construction Industry Collective-Bargaining Relationships
AGENCY: National Labor Relations Board
ACTION: Notice of proposed rulemaking; request for comments.
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SUMMARY: As part of its ongoing efforts to more effectively administer
the National Labor Relations Act (the Act or the NLRA) and to further
the purposes of the Act, the National Labor Relations Board (the Board)
proposes to amend its rules and regulations governing the filing and
processing of petitions for a Board-conducted representation election
while unfair labor practice charges are pending or following an
employer's voluntary recognition of a union as the majority-supported
collective-bargaining representative of the employer's employees. The
Board also proposes an amendment redefining the evidence required to
prove that an employer and labor organization in the construction
industry have established a voluntary majority-supported collective-
bargaining relationship. The Board believes, subject to comments, that
the proposed amendments will better protect employees' statutory right
of free choice on questions concerning representation by removing
unnecessary barriers to the fair and expeditious resolution of such
questions through the preferred means of a Board-conducted secret
ballot election.
DATES: Comments regarding this proposed rule must be received by the
Board on or before October 11, 2019. Comments replying to comments
submitted during the initial comment period must be received by the
Board on or before October 25, 2019. Reply comments should be limited
to replying to comments previously filed by other parties. No late
comments will be accepted.
ADDRESSES:
Internet--Federal eRulemaking Portal. Electronic comments may be
submitted through http://www.regulations.gov.
Delivery--Comments should be sent by mail or hand delivery to:
Roxanne Rothschild, Executive Secretary, National Labor Relations
Board, 1015 Half Street SE, Washington, DC 20570-0001. Because of
security precautions, the Board continues to experience delays in U.S.
mail delivery. You should take this into consideration when preparing
to meet the deadline for submitting comments. The Board encourages
electronic filing. It is not necessary to send comments if they have
been filed electronically with regulations.gov. If you send comments,
the Board recommends that you confirm receipt of your delivered
comments by contacting (202) 273-1940 (this is not a toll-free number).
Individuals with hearing impairments may call 1-866-315-6572 (TTY/TDD).
Only comments submitted through http://www.regulations.gov, hand
delivered, or mailed will be accepted; ex parte communications received
by the Board will be made part of the rulemaking record and will be
treated as comments only insofar as appropriate. Comments will be
available for public inspection at http://www.regulations.gov and
during normal business hours (8:30 a.m. to 5 p.m. EST) at the above
address.
The Board will post, as soon as practicable, all comments received
on http://www.regulations.gov without making any changes to the
comments, including any personal information provided. The website
http://www.regulations.gov is the Federal eRulemaking portal, and all
comments posted there are available and accessible to the public. The
Board requests that comments include full citations or internet links
to any authority relied upon. The Board cautions commenters not to
include personal information such as Social Security numbers, personal
addresses, telephone numbers, and email addresses in their comments, as
such submitted information will become viewable by the public via the
http://www.regulations.gov website. It is the commenter's
responsibility to safeguard his or her information. Comments submitted
through http://www.regulations.gov will not include the commenter's
email address unless the commenter chooses to include that information
as part of his or her comment.
FOR FURTHER INFORMATION CONTACT: Roxanne Rothschild, Executive
Secretary, National Labor Relations Board, 1015 Half Street SE,
Washington, DC 20570-0001, (202) 273-1940 (this is not a toll-free
number), 1-866-315-6572 (TTY/TDD).
SUPPLEMENTARY INFORMATION: The National Labor Relations Board is
proposing three amendments to its current rules and regulations
governing the filing and processing of petitions relating to a labor
organization's exclusive representation of employees for purposes of
collective bargaining with their employer. The first amendment would
modify the Board's election blocking charge policy--not currently set
forth in the rules and regulations--by establishing a vote and impound
procedure for processing representation petitions when a party has
requested blocking the election based on a pending unfair labor
practice charge. The second amendment would modify the current
recognition bar policy--also not currently set forth in the rules and
regulations--by reestablishing a notice requirement and 45-day open
period for filing an election petition following an employer's
voluntary recognition of a labor organization as employees' majority-
supported exclusive collective-bargaining representative under Section
9(a) of the Act. The third amendment would overrule current Board law--
also not currently set forth in the rules and regulations--holding that
contract language, standing alone, can establish the existence of a
Section 9(a) majority-based bargaining relationship for parties in the
construction industry, rather than a relationship under Section 8(f),
the second proviso of which prohibits any election bar. To prove the
establishment of a Section 9(a) relationship in the construction
industry and the existence of a contract bar to an election, the
proposed amendment would require extrinsic evidence, in the form of
employee signatures on union authorization cards or a petition, that
recognition was based on a contemporaneous showing of majority employee
support.
The Board believes, subject to comments, that the current blocking
charge policy, the immediate imposition of a voluntary recognition
election bar, and the establishment of a Section 9(a) relationship in
the construction industry based solely on contract recognition language
constitute an overbroad and inappropriate limitation on the ability of
employees to exercise their fundamental statutory right to the timely
resolution of questions concerning representation through the preferred
means of a Board-conducted secret ballot election.
I. Background
Section 9(c) of the Act provides that the Board ``shall direct an
election by secret ballot'' if the Board finds that a question of
representation exists. The Supreme Court has repeatedly recognized that
Congress granted the Board wide discretion under the Act to ensure that
employees are freely and fairly able to choose whether to have a
bargaining representative. E.g., NLRB v. Wyman-Gordon Co., 394 U.S.
759, 767
[[Page 39931]]
(1969). The Court has noted that ``[t]he control of the election
proceedings, and the determination of the steps necessary to conduct
that election fairly were matters which Congress entrusted to the Board
alone.'' NLRB v. Waterman S.S. Corp., 309 U.S. 206, 226 (1940). In NLRB
v. A.J. Tower Co., the Court stated that ``the Board must act so as to
give effect to the principle of majority rule set forth in [Section]
9(a), a rule that `is sanctioned by our governmental practices, by
business procedure, and by the whole philosophy of democratic
institutions.' '' 329 U.S. 324, 331 (1946) (quoting S. Rep. No. 74-573,
at 13). The Court continued, ``It is within this democratic framework
that the Board must adopt policies and promulgate rules and regulations
in order that employees' votes may be recorded accurately, efficiently
and speedily.'' Id.
Representation case procedures are set forth in the statute, in
Board regulations, and in Board caselaw. In addition, the Board's
General Counsel has prepared a non-binding Casehandling Manual
describing representation case procedures in detail.\1\ The Act itself
contains only one express limitation on the timing of otherwise valid
election petitions. Section 9(c)(3) provides that ``[n]o election shall
be directed in any bargaining unit or any subdivision within which, in
the preceding twelve-month period, a valid election shall have been
held.'' The Board instituted through adjudication a parallel limitation
precluding, with limited exceptions, an electoral challenge to a
union's representative status for one year from the date of a
certification based on an employee majority vote for exclusive
representation in a valid Board election. The Supreme Court approved
this certification year election bar in Brooks v. NLRB, 348 U.S. 96
(1954).
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\1\ NLRB Casehandling Manual (Part Two) Representation
Proceedings.
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The proposed rulemaking does not implicate either the statutory
election year bar or the certification year bar. As fully described
below, however, the Board has also created through adjudication several
additional discretionary bars to the timely processing of a validly
supported election petition,\2\ three of which--the blocking charge
policy, the voluntary recognition election bar policy, and the contract
bar--are the subject of this proposed rulemaking proceeding.\3\
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\2\ In Board terminology, representation election petitions
filed by labor organizations are classified as RC petitions and
those filed by employers are RM petitions; decertification petitions
filed by an individual employee are classified as RD petitions.
\3\ Other discretionary election bar policies established
through adjudication, all of which preclude electoral challenges to
an incumbent union bargaining representative for some period of
time, include the contract bar, General Cable Corp., 139 NLRB 1123,
1125 (1962) (precluding election for up to first 3 years of contract
term); the affirmative remedial bargaining order bar, Lee Lumber &
Building Material Corp., 334 NLRB 399, 402 (2001) (precluding
election for at least six months and up to one year from the first
bargaining session following Board finding of unlawful refusal to
bargain and issuance of bargaining-order remedy), enfd. 310 F.3d 209
(D.C. Cir. 2002); the successor bar, UGL-UNICCO Service Co., 357
NLRB 801 (2011) (precluding election for at least six months and up
to one year from the first post-succession bargaining session); and
the settlement bar, Poole Foundry & Machine Co., 95 NLRB 34, 36
(1950) (precluding election for a reasonable period of time
following settlement of certain unfair labor practice charges),
enfd. 192 F.2d 740 (4th Cir. 1951), cert. denied 342 U.S. 954
(1952). The proposed rule modifying current law with respect to
proof of majority-based recognition in the construction industry
necessarily involves the issue of when a contract bar will apply.
Otherwise, this proposed rulemaking is not intended to address other
election bar policies. The Board may choose to address one or more
of these policies in future proceedings.
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A. Blocking Charge Policy
The blocking charge policy dates from shortly after the Act went
into effect. See United States Coal & Coke Co., 3 NLRB 398 (1937). A
product of adjudication,\4\ the policy permits a party--almost
invariably a union and most often in response to an RD petition--to
block an election indefinitely by filing unfair labor practice charges
that allegedly create doubt as to the validity of the election petition
or as to the ability of employees to make a free and fair choice
concerning representation while the charges remain unresolved. This
policy can preclude holding the petitioned-for election for months, or
even years, if at all. See, e.g., Cablevision Systems Corp., 367 NLRB
No. 59 (2018) (blocking charge followed by Regional Director's
misapplication of settlement bar doctrine delayed processing until
December 19, 2018, of valid RD petition filed on October 16, 2014;
employee petitioner thereafter withdrew petition).
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\4\ Except for certain evidentiary requirements, discussed
below, that are set forth in Section 103.20 of the Board's Rules and
Regulations, the current blocking charge policy is not codified. A
detailed description of the policy appears in the non-binding NLRB
Casehandling Manual (Part Two) Representation, Sections 11730 to
11734. In brief, the policy affords regional directors
administrative discretion to hold election petitions in abeyance or
to dismiss them based on the request of a charging party alleging
either unfair labor practice conduct that ``only interferes with
employee free choice'' (a Type I charge) or conduct that ``not only
interferes with employee free choice but also is inherently
inconsistent with the petition itself'' (a Type II charge). Section
11730.1.
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Statistical studies indicate that the blocking charge delay in
Cablevision is not an anomaly. It is instead representative of a
systemic problem in blocking charge cases, which have been identified
as the likely cause of what has been characterized as ``the long tail''
of delay in the Board's processing of representation cases.\5\ In a
study conducted by Professor Samuel Estreicher of petitions processed
to elections in 2008, statistics provided to him by the Board indicated
that the filing of blocking charges substantially increased the median
processing time to an election.\6\ Specifically, the study showed that
``in 284 of the 2,024 petitions that proceeded to election in 2008,
allegations of employer violations triggered the filing of a `blocking
charge' by a labor organization, delaying the holding of the election,
The median for this subset was 139 days compared to thirty-eight days
overall [for unblocked cases].'' Id. at 370.
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\5\ See John-Paul Ferguson, The Eyes of the Needles: A
Sequential Model of Union Organizing Drives, 1999-2004, 62 Indus. &
Lab. Rel. Rev. 3, 10 fn. 9 (Oct. 2008). The Ferguson study of Board
representation case statistics for this 5-year period indicated that
elections in 95% of cases were held within 75 days of the filing of
a petition. ``The tail, however, is quite long; the maximum delay
before election recorded in the data is 1,705 days.'' Id.
\6\ Samuel Estreicher, Improving the Administration of the
National Labor Relations Act Without Statutory Change, 5 FIU L. Rev.
361, 369-370 (2010). The Estreicher study focused only on those
cases actually processed to an election in 2008. An earlier review
of Board representation case statistics from 1977 indicated that, as
in the recent Cablevision case, more than half of the RD petitions
filed with the Board never resulted in an election. William Krupman
and Gregory Rasin, Decertification: Removing the Shroud, 30 Lab.
L.J. 231, 231 (1979). The authors suggested two explanations for
this result: ``First, many unions faced with the prospect of losing
a decertification election choose to withdraw rather than risk
defeat. Second, many petitions are `blocked' from further processing
as a result of unfair labor practice charges filed by the union.''
Id. at 231-232.
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The adverse impact on employee RD petitions resulting from the
Board's blocking charge policy, and the potential for abuse and
manipulation of that policy by incumbent unions seeking to avoid a
challenge to their representative status, have drawn criticism from
courts of appeals on several occasions. See Pacemaker Corp v. NLRB, 260
F.2d 880, 882 (7th Cir. 1958) (``The practice adopted by the Board is
subject to abuse as is shown in the instant case. After due notice both
parties proceeded with the representation hearing. Possibly for some
reasons of strategy near the close of the hearing, the [u]nion asked
for an adjournment. Thereafter it filed a second amended charge of
unfair labor practice. By such strategy the [u]nion was able to and did
stall and postpone indefinitely the representation hearing.''); NLRB v.
Minute Maid Corp.,
[[Page 39932]]
283 F.2d 705, 710 (5th Cir. 1960) (``Nor is the Board relieved of its
duty to consider and act upon an application for decertification for
the sole reason that an unproved charge of an unfair practice has been
made against the employer. To hold otherwise would put the union in a
position where it could effectively thwart the statutory provisions
permitting a decertification when a majority is no longer
represented.''); NLRB v. Midtown Service Co., 425 F.2d 665, 672 (2d
Cir. 1970) (``[If] the charges were filed by the union, adherence to
the [blocking charge] policy in the present case would permit the
union, as the beneficiary of the [e]mployer's misconduct, merely by
filing charges to achieve an indefinite stalemate designed to
perpetuate the union in power. If, on the other hand, the charges were
filed by others claiming improper conduct on the part of the
[e]mployer, we believe that the risk of another election (which might
be required if the union prevailed but the charges against the Employer
were later upheld) is preferable to a three-year delay.''); Templeton
v. Dixie Color Printing Co., 444 F.2d 1064, 1069 (5th Cir. 1971) (``The
short of the matter is that the Board has refused to take any notice of
the petition filed by appellees and by interposing an arbitrary
blocking charge practice, applicable generally to employers, has held
it in abeyance for over 3 years. As a consequence, the appellees have
been deprived during all this time of their statutory right to a
representative `of their own choosing' to bargain collectively for
them, 29 U.S.C. 157, despite the fact that the employees have not been
charged with any wrongdoing. Such practice and result are intolerable
under the Act and cannot be countenanced.''); NLRB v. Hart Beverage
Co., 445 F.2d 415, 420 (8th Cir. 1971) (``[I]t appears clearly
inferable to us that one of the purposes of the [u]nion in filing the
unfair practices charge was to abort [r]espondent's petition for an
election, if indeed, that was not its only purpose.'').
The potential for delay is the same when employees, instead of
filing an RD petition, have expressed to their employer a desire to
decertify an incumbent union representative. In that circumstance, the
blocking charge policy can prevent the employer from being able to seek
a timely Board-conducted election to resolve the question concerning
representation raised by evidence of good-faith uncertainty as to the
union's continuing majority support. Thus, the supposed ``safe harbor''
of filing an RM election petition that the Board majority referenced in
Levitz Furniture Co. of the Pacific, 333 NLRB 717, 726 (2001), as an
alternative to the option of withdrawing recognition (which the
employer selects at its peril) is often illusory. As Judge Henderson
stated in her concurring opinion in Scomas of Sausalito, LLC v. NLRB,
it is no ``cure-all'' for an employer with a good-faith doubt about a
union's majority status to simply seek an election because ``[a] union
can and often does file a ULP charge--a `blocking charge'--`to
forestall or delay the election.' '' 849 F.3d 1147, 1159 (D.C. Cir.
2017) (quoting from Member Hurtgen's concurring opinion in Levitz, 333
NLRB at 732).
Concerns have also been raised about the Agency's regional
directors not applying the blocking charge policy consistently, thereby
creating uncertainty and confusion about when, if ever, parties can
expect an election to occur. See Zev J. Eigen & Sandro Garofalo, Less
Is More: A Case for Structural Reform of the National Labor Relations
Board, 98 Minn. L. Rev. 1879, 1896-1897 (2014) (``Regional directors
have wide discretion in allowing elections to be blocked, and this
sometimes results in the delay of an election for months and in some
cases for years--especially when the union resorts to the tactic of
filing consecutive unmeritorious charges over a long period of time.
This is contrary to the central policy of the Act, which is to allow
employees to freely choose their bargaining representative, or to
choose not to be represented at all.'').
In 2014, the Board engaged in a broad notice-and-comment rulemaking
review of the then-current rules governing the representation election
process. In the Notice of Proposed Rulemaking (NPRM) issued on February
6, 2014, a Board majority proposed numerous specific changes to that
process. 79 FR 7318. The overarching purpose of these proposed changes
was ``to better insure `that employees' votes may be recorded
accurately, efficiently and speedily' and to further `the Act's policy
of expeditiously resolving questions concerning representation.' '' \7\
Many, if not most, of the proposed changes focused on shortening the
time between the filing of a union's RC petition for initial
certification as an exclusive bargaining representative and the date of
an election. With relatively few variations, the final Election Rule
published on December 15, 2014, adopted 25 changes proposed in the
NPRM. 79 FR 74308 (2014). The final Election Rule went into effect on
April 14, 2015.
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\7\ 79 FR 7323, quoting from NLRB v. A.J. Tower Co., 329 U.S. at
331, and Northeastern University, 261 NLRB 1001, 1002 (1982).
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The 2014 NPRM included a ``Request for Comment Regarding Blocking
Charges'' that did not propose a change in the current blocking charge
policy but invited public comment on whether any of nine possible
changes should be made as part of a final rule or through means other
than amendment of the Board's rules.\8\ Extensive commentary was
received both in favor of retaining the existing policy and of revising
or abandoning the policy. The final Election Rule, however, made only
minimal revisions in this respect. The majority incorporated, in new
Section 103.20, provisions requiring that a party requesting the
blocking of an election based on an unfair labor practice charge make a
simultaneous offer of proof, provide a witness list, and promptly make
those witnesses available. These revisions were viewed as facilitating
the General Counsel's existing practice of conducting expedited
investigations in blocking charge cases. The majority declined to make
any other changes in the existing policy, expressing the view that the
policy was critical to protecting employees' exercise of free
choice,\9\ and that ``[i]t advances no policy of the Act for the agency
to conduct an election unless employees can vote without unlawful
interference.'' \10\
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\8\ 79 FR 7334-7335.
\9\ 79 FR at 74418-74420, 74428-74429.
\10\ 79 FR 74429.
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Dissenting Board Members Miscimarra and Johnson criticized the
majority's failure to make more significant revisions in the blocking
charge policy, contrasting the majority's concern with impact on
employee free choice of election delays in initial representation RC
elections with a perceived willingness to accept prolonged delay in
blocking charge cases that predominantly involve RD or RM petitions
challenging an incumbent union's continuing representative status. In
the dissenters' opinion, it was incumbent on the Board to undertake
more substantial reform of a policy that was responsible for a major
part of the ``long tail'' of cases where an election was delayed for
more than 100 days beyond the average petition processing time.\11\
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\11\ See discussion at 79 FR 74455-74456. The dissenters
advocated ``a 3-year trial period in which petitions will be
routinely processed and elections conducted in Type I blocking
charge cases, with the votes thereafter impounded, even in cases
where a regional director finds that there is probable cause to
believe an unfair labor practice was committed that would require
the processing of the petition to be held in abeyance under current
policy.'' 79 FR 74456.
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[[Page 39933]]
A 2015 review of the Election Rule by Professor Jeffrey M. Hirsch
excepted the majority's treatment of the blocking charge policy from a
generally favorable analysis of the rule revisions. Noting the
persistent problems with delay and abuse, Professor Hirsch observed
that ``[t]he Board's new rules indirectly affected the blocking charge
policy by requiring parties to file an offer of proof to support a
request for a stay, but that requirement is unlikely to change much, if
anything. Instead, the Board should have explored new rules such as
lowering the presumption that favors staying elections in most
circumstances or setting a cap on the length of stays, either of which
might have satisfied the blocking charge policy's main purpose while
reducing abuse.'' \12\
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\12\ Jeffrey M. Hirsch, NLRB Elections: Ambush or Anticlimax?,
64 Emory L.J. 1647, 1664 (2015).
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Statistics provided by the General Counsel for years postdating the
2015 implementation of the Final Rule confirm Professor Hirsch's
observation that the rule did not change much.\13\ Those statistics do
indicate a drop in the number of blocked cases that have been processed
to an election for Fiscal Years (FY) 2016, 2017, and 2018, possibly
indicating that the new evidentiary requirements have facilitated quick
elimination of obviously baseless blocking charges. On the other hand,
the statistics indicate the same or greater disparity between blocked
and unblocked cases in petition-to-election processing time, when
compared to the 2008 statistics analyzed in the Estreicher study.\14\
Even more concerning is the information that on December 31, 2018,
there were 118 blocked petitions pending; those cases had been pending
for an average of 893 days; and the oldest case had been pending for
4,491 days, i.e., more than 12 years.\15\ See Majority Appendix B.
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\13\ See Majority Appendix B, available at https://www.nlrb.gov.
\14\ See Majority Appendix A, available at https://www.nlrb.gov.
The median number of days from petition to election from 2016
through 2018 was 23 days in unblocked cases. The median number of
days from petition to election in the same period for blocked cases
ranged from 122 to 145 days.
\15\ We note that our dissenting colleague takes a different
view of the breadth of the current blocking charge policy's impact,
based on her preliminary review of statistics provided to us and her
by the General Counsel. However, she acknowledges that in FY 2016
and FY 2017, about 20 percent of decertification petitions filed
were blocked. She views this number as either inconsequentially
slight or justifiable on policy grounds. That is her opinion. We
welcome the opinions of others, including their statistical
analyses, in comments responsive to the NPRM.
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On December 12, 2017, the Board issued a Request for Information
that generally invited the public to respond with information about
whether the 2014 Election Rule should be retained without change,
retained with modifications, or rescinded. 82 FR 58783. Relatively few
responders addressed the change made with respect to requirements of
proof in support of a blocking charge request. A number of responders,
however, used this occasion to ask the Board to rescind or
substantially modify the blocking charge policy. The reasons
articulated for rescinding the policy are essentially the same as those
offered in response to the 2014 NPRM. Among commenters that proposed
revision of the blocking charge policy rather than complete rescission,
the Board's General Counsel has proposed that the Board adopt a vote-
and-impound procedure whereby an election would be held regardless of
whether a blocking charge and blocking request are pending. If the
merits of the charge have not been resolved prior to the election, the
ballots would be impounded.
B. The Voluntary Recognition Bar
Longstanding precedent holds that a ``Board election is not the
only method by which an employer may satisfy itself as to the union's
majority status [under Section 9(a) of the Act].'' United Mine Workers
v. Arkansas Flooring Co., 351 U.S. 62, 72 fn. 8 (1956). Voluntary
recognition agreements based on a union's showing of majority support
are undisputedly lawful. NLRB v. Gissel Packing Co., 395 U.S. 575, 595-
600 (1969). However, it was not until Keller Plastics Eastern, Inc.,
157 NLRB 583 (1966), that the Board addressed the issue of whether a
Section 9(a) bargaining relationship established by voluntary
recognition can be disrupted by the recognized union's subsequent loss
of majority status. Although the union in Keller Plastics had lost
majority support by the time the parties executed a contract little
more than 3 weeks after voluntary recognition, the Board rejected the
General Counsel's claim that the employer was violating the Act by
continuing to recognize a nonmajority union as the employees'
representative. The Board reasoned that ``like situations involving
certifications, Board orders, and settlement agreements, the parties
must be afforded a reasonable time to bargain and to execute the
contracts resulting from such bargaining. Such negotiations can
succeed, however, and the policies of the Act can thereby be
effectuated, only if the parties can normally rely on the continuing
representative status of the lawfully recognized union for a reasonable
period of time.'' Id. at 586. Soon thereafter, the Board extended this
recognition bar policy to representation cases and held that an
employer's voluntary recognition of a union would immediately bar the
filing of an election petition for a reasonable amount of time
following recognition. Sound Contractors, 162 NLRB 364 (1966).
From 1966 until 2007, the Board tailored the duration of the
immediate recognition bar to the circumstances of each case, stating
that what constitutes a reasonable period of time ``does not depend
upon either the passage of time or the number of calendar days on which
the parties met. Rather, the issue turns on what transpired during
those meetings and what was accomplished therein.'' Brennan's Cadillac,
Inc., 231 NLRB 225, 226 (1977). In some cases, a few months of
bargaining were deemed enough to give the recognized union a fair
chance to succeed, whereas in other cases substantially more time was
deemed warranted. Compare Brennan's Cadillac (employer entitled to
withdraw recognition after 4 months) with MGM Grand Hotel, 329 NLRB
464, 466 (1999) (more than 11 months was reasonable considering the
large size of the unit, the complexity of the bargaining structure and
issues, the parties' frequent meetings and diligent efforts, and the
substantial progress made).
In Dana Corp., 351 NLRB 434 (2007), a Board majority reviewed the
development of the immediate recognition bar policy and concluded
``that the current recognition bar policy should be modified to provide
greater protection for employees' statutory right of free choice and to
give proper effect to the court- and Board-recognized statutory
preference for resolving questions concerning representation through a
Board secret-ballot election.'' Id. at 437.\16\
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\16\ The 2007 Dana decision followed a decision granting review,
consolidating two cases, and inviting briefing by the parties and
amici on the voluntary recognition bar issue. Dana Corp., 341 NLRB
1283 (2004). In response, the Board received 24 amicus briefs,
including one from the Board's General Counsel, in addition to
briefs on review and reply briefs from the parties. Dana Corp., 351
NLRB at 434 fn. 2.
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Drawing on the General Counsel's suggestion in his amicus brief of
a modified voluntary recognition election bar, the Dana majority held
that ``[t]here will be no bar to an election following a grant of
voluntary recognition unless (a) affected unit employees receive
adequate notice of the recognition and of their opportunity to file a
Board election petition within 45 days, and (b) 45 days pass from the
date of notice without the filing of a validly-supported petition.
These rules apply notwithstanding the execution of a collective-
bargaining agreement
[[Page 39934]]
following voluntary recognition. In other words, if the notice and
window-period requirements have not been met, any postrecognition
contract will not bar an election.'' \17\
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\17\ 351 NLRB at 441. The recognition bar modifications did not
affect the obligation of an employer to bargain with the recognized
union during the post-recognition open period, even if a
decertification or rival petition was filed. Id. at 442.
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The Dana majority emphasized ``the greater reliability of Board
elections'' as a principal reason for the announced modification, In
this respect, while a majority card showing has been recognized as a
reliable basis for the establishment of a Section 9(a) bargaining
relationship, authorization cards are ``admittedly inferior to the
election process.'' \18\ Several reasons were offered in support of
this conclusion. ``First, unlike votes cast in privacy by secret Board
election ballots, card signings are public actions, susceptible to
group pressure exerted at the moment of choice.'' \19\ This is in
contrast to a secret ballot vote cast in the ``laboratory conditions''
of a Board election, held ``under the watchful eye of a neutral Board
agent and observers from the parties,'' \20\ and free from immediate
observation, persuasion, or coercion by opposing parties or their
supporters. ``Second, union card-solicitation campaigns have been
accompanied by misinformation or a lack of information about employees'
representational options.'' \21\ Particularly in circumstances where
voluntary recognition is preceded by an employer entering into a
neutrality agreement with the union, including an agreement to provide
union access for organizational purposes, employees may not understand
they even have an electoral option or an alternative to representation
by the organizing union. ``Third, like a political election, a Board
election presents a clear picture of employee voter preference at a
single moment. On the other hand, card signings take place over a
protracted period of time.'' \22\ A statistical study cited in several
briefs and by the Dana majority indicated a significant disparity
between union card showings of support obtained over a period of time
and ensuing Board election results.\23\ Lastly, the Board election
process provides for a post-election review of impermissible
electioneering and other objectionable conduct that may result in Board
invalidation of the election results and the conduct of a second
election. ``There are no guarantees of comparable safeguards in the
voluntary recognition process.'' \24\
---------------------------------------------------------------------------
\18\ NLRB v. Gissel Packing Co., 395 U.S. at 603.
\19\ Dana Corp., 351 NLRB at 438.
\20\ Id. at 439.
\21\ Id.
\22\ Id.
\23\ Id., citing McCulloch, A Tale of Two Cities: Or Law in
Action, Proceedings of ABA Section of Labor Relations Law 14, 17
(1962).
\24\ Id.
---------------------------------------------------------------------------
In Lamons Gasket Company, 357 NLRB 739 (2011),\25\ a new Board
majority overruled Dana Corp. and reinstated the immediate voluntary
recognition election bar. The majority emphasized the validity of
voluntary recognition as a basis for establishing a Section 9(a)
majority-based recognition. Further, citing Board statistical evidence
that employees had decertified the voluntarily recognized union in only
1.2 percent of the total cases in which a Dana notice was
requested,\26\ the majority concluded that the Dana modifications to
the voluntary recognition bar were unnecessary and that the Dana
majority's concerns about the reliability of voluntary recognition as
an accurate indicator of employee choice were unfounded. The Lamons
Gasket majority criticized the Dana notice procedure as compromising
Board neutrality by ``suggest[ing] to employees that the Board
considers their choice to be represented suspect and signal[ing] to
employees that their choice should be reconsidered.'' Id. at 744. The
majority opinion also defended the voluntary recognition bar as
consistent with other election bars that are based on a policy of
assuring that `` `a bargaining relationship once rightfully established
must be permitted to exist and function for a reasonable period in
which it can be given a fair chance to succeed.' '' Id. (quoting Franks
Bros. Co. v. NLRB, 321 U.S. 702, 705 (1944)). The majority viewed the
Dana 45-day open period as contrary to this policy by creating a period
of post-recognition uncertainty during which an employer has little
incentive to bargain, even though technically required to do so. Id. at
747. Finally, having determined to return to the immediate recognition
bar policy, the Lamons Gasket majority applied its holding
retroactively and, based on the Board's decision in Lee Lumber &
Building Material Corp., 334 NLRB at 399, the majority defined the
reasonable period of time during which a voluntary recognition would
bar an election as no less than six months after the date of the
parties' first bargaining session and no more than one year after that
date. Id. at 748.
---------------------------------------------------------------------------
\25\ Similar to the Dana proceeding, the 2011 Lamons Gasket
decision followed a decision granting review, consolidating two
cases, and inviting briefing by the parties and amici on the
voluntary recognition bar issue. Rite Aid Store #6473, 355 NLRB 763
(2010). In response, the Board received 17 amicus briefs, in
addition to briefs on review and reply briefs from the parties.
Lamons Gasket, 357 NLRB at 740 fn.1.
\26\ ``As of May 13, 2011, the Board had received 1,333 requests
for Dana notices. In those cases, 102 election petitions were
subsequently filed and 62 elections were held. In 17 of those
elections, the employees voted against continued representation by
the voluntarily recognized union, including 2 instances in which a
petitioning union was selected over the recognized union and 1
instance in which the petition was withdrawn after objections were
filed. Thus, employees decertified the voluntarily recognized union
under the Dana procedures in only 1.2 percent of the total cases in
which Dana notices were requested.'' Id. at 742.
---------------------------------------------------------------------------
Member Hayes dissented in Lamons Gasket,\27\ arguing that Dana was
correctly decided for the policy reasons stated there, most importantly
the statutory preference for a secret ballot Board election to resolve
questions of representation under Section 9 of the Act. He noted that
the Lamons Gasket majority's efforts to secure empirical evidence of
Dana's shortcomings by inviting briefs from the parties and amici
``yielded a goose egg.'' \28\ Consequently, the only meaningful
empirical evidence came from the Board's own election statistics. In
this regard, he disagreed with the majority's view that the minimal
number of elections held and votes cast against the recognized union
proved the Dana modifications were unnecessary. In his view, the
statistics showed that in one of every four elections held, an employee
majority voted against representation by the incumbent recognized
union. While that 25-percent rejection rate was below the recent annual
rejection rate for all decertification elections, it was nevertheless
substantial and supported retention of a notice requirement and brief
open period.\29\
---------------------------------------------------------------------------
\27\ Id. at 748-754.
\28\ Id. at 750 (``Only five respondents sought to overturn
Dana, and only two of them supported their arguments for doing so
with the barest of anecdotal evidence.'') (footnotes omitted).
\29\ Id. at 751.
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At least since Lamons Gasket, the imposition of the immediate
recognition bar, followed by the execution of a collective-bargaining
agreement, can preclude the possibility of conducting a Board election
contesting the initial non-electoral recognition of a union as a
majority-supported exclusive bargaining representative for as many as
four years. The 2014 Election Rule did not include substantive
discussion of the reimposition of the immediate voluntary recognition
election bar in Lamons Gasket. A few respondents to the 2017 Request
for Information contended that the Board should eliminate this and
other discretionary election bars, or in the alternative,
[[Page 39935]]
should reinstate the Dana notice and open period requirements.
C. Proof of Majority-Based Recognition Under Section 9(a) in the
Construction Industry
In 1959, Congress enacted Section 8(f) of the Act to address unique
characteristics of employment and bargaining practices in the
construction industry. Section 8(f) permits an employer and labor
organization in the construction industry to establish a collective-
bargaining relationship in the absence of majority support, an
exception to the majority-based requirements for establishing a
collective-bargaining relationship under Section 9(a). While the
impetus for this exception to majoritarian principles stemmed primarily
from the fact that construction industry employers often executed pre-
hire agreements with a labor organization in order to assure a
reliable, cost-certain source of labor referred from a union hiring
hall for a specific job, the exception applies as well to voluntary
recognition and collective-bargaining agreements executed by a
construction industry employer that has employees. However, the second
proviso to Section 8(f) states that any agreement that is lawful only
because of that section's nonmajority exception cannot bar a petition
for a Board election. Accordingly, there cannot be a contract bar or
voluntary recognition bar to an election among employees covered by an
8(f) agreement.
Board precedent has varied with respect to the test of whether a
bargaining relationship and a collective-bargaining agreement in the
construction industry are governed by Section 9(a) majoritarian
principles or by Section 8(f) and its exception to those principles. In
1971, the Board adopted a ``conversion doctrine,'' under which a
bargaining relationship initially established under Section 8(f) could
convert into a 9(a) relationship by means other than a Board election
or majority-based voluntary recognition. See R. J. Smith Construction
Co., 191 NLRB 693 (1971), enf. denied sub nom. Operating Engineers
Local 150 v. NLRB, 480 F.2d 1186 (D.C. Cir. 1973); Ruttmann
Construction Co., 191 NLRB 701 (1971). As subsequently described in
John Deklewa & Sons, 282 NLRB 1375, 1378 (1987), enfd. sub nom. Iron
Workers Local 3 v. NLRB, 843 F.2d 770 (3rd Cir. 1988), R.J. Smith and
Ruttmann viewed a Section 8(f) agreement as `` `a preliminary step that
contemplates further action for the development of a full bargaining
relationship' '' (quoting from Ruttmann, 191 NLRB at 702). This
preliminary 8(f) relationship/agreement could convert to a 9(a)
relationship/agreement, within a few days or years later, if the union
could show that it had achieved majority support among bargaining-unit
employees during a contract term. ``The achievement of majority support
required no notice, no simultaneous union claim of majority, and no
assent by the employer to complete the conversion process.'' Id. Proof
of majority support sufficient to trigger conversion included ``the
presence of an enforced union-security clause, actual union membership
of a majority of unit employees, as well as referrals from an exclusive
hiring hall.'' Id. The duration and scope of the post-conversion
contract's applicability under Section 9(a) would vary, depending upon
the scope of the appropriate unit (single or multiemployer) and the
employer's hiring practices (project-by-project or permanent and stable
workforce). Id. at 1379.
The Deklewa Board made fundamental changes in the law governing
construction industry bargaining relationships and set forth new
principles that are relevant to this rulemaking. First, it repudiated
the conversion doctrine as inconsistent with statutory policy and
Congressional intent expressed through the second proviso to Section
8(f) ``that an 8(f) agreement may not act as a bar to, inter alia,
decertification or rival union petitions.'' Id. at 1382. Contrary to
this intent, the ``extraordinary'' conversion of an original 8(f)
agreement into a 9(a) agreement raised ``an absolute bar to employees'
efforts to reject or to change their collective-bargaining
representative,'' depriving them of the ``meaningful and readily
available escape hatch'' assured by the second proviso. Id. Second, the
Board held that 8(f) contracts and relationships are enforceable
through Section 8(a)(5) and Section 8(b)(3) of the Act, but only for as
long as the contract remains in effect. Upon expiration of the
contract, ``either party may repudiate the relationship.'' Id. at 1386.
Further, inasmuch as Section 8(f) permits an election at any time
during the contract term, ``[a] vote to reject the signatory union will
void the 8(f) agreement and will terminate the 8(f) relationship. In
that event, the Board will prohibit the parties from reestablishing the
8(f) relationship covering unit employees for a 1-year period.'' Id.
Third, the Board presumed that collective-bargaining agreements in the
construction industry are governed by Section 8(f), so that ``a party
asserting the existence of a 9(a) relationship bears the burden of
proving it.'' Id. at 1385 fn. 41. Finally, stating that ``nothing in
this opinion is meant to suggest that unions have less favored status
with respect to construction industry employers than they possess with
respect to those outside the construction industry,'' the Board
affirmed that a construction industry union could achieve 9(a) status
through ``voluntary recognition accorded . . . by the employer of a
stable workforce where that recognition is based on a clear showing of
majority support among the union employees, e.g., a valid card
majority.'' Id at 1387 fn. 53.
Deklewa's presumption of 8(f) status for construction industry
relationships did not preclude the possibility that a relationship
undisputedly begun under Section 8(f) could become a 9(a) relationship
upon the execution of a subsequent agreement. In cases applying
Deklewa, however, the Board repeatedly stated the requirement, both for
initial and subsequent agreements, that in order to prove a 9(a)
relationship, a union would have to show `` `its express demand for,
and an employer's voluntary grant of, recognition to the union as
bargaining representative based on a contemporaneous showing of union
support among a majority of employees in an appropriate unit.' ''
Brannan Sand & Gravel Co., 289 NLRB 977, 979-980 (1988) (quoting
American Thoro-Clean, Ltd., 283 NLRB 1107, 1108-1109 (1987)). Further,
in J & R Tile, 291 NLRB 1034, 1036 (1988), the Board held that, to
establish voluntary recognition, there must be ``positive evidence that
a union unequivocally demanded recognition as the employees' 9(a)
representative and that the employer unequivocally accepted it as
such.'' \30\
---------------------------------------------------------------------------
\30\ Golden West Electric, 307 NLRB 1494, 1495 (1992) (citing J
& R Tile, supra). In an Advice Memorandum issued after J & R Tile,
the General Counsel noted record evidence that the employer in that
case ``clearly knew that a majority of his employees belonged to the
union, since he had previously been an employee and a member of the
union. However, the Board found that in the absence of positive
evidence indicating that the union sought, and the employer
thereafter granted, recognition as the 9(a) representative, the
employer's knowledge of the union's majority status was insufficient
to take the relationship out of Section 8(f).'' In re Frank W.
Schaefer, Inc., Case 9-CA-25539, 1989 WL 241614.
---------------------------------------------------------------------------
In Staunton Fuel & Material, Inc., 335 NLRB 717, 719-720 (2001),
the Board for the first time held that a construction industry union
could prove 9(a) recognition on the basis of contract language alone
without any other ``positive evidence'' of a contemporaneous showing of
majority support. Relying on two recent decisions by the United States
Court of
[[Page 39936]]
Appeals for the Tenth Circuit,\31\ the Board held that language in a
contract was independently sufficient to prove a 9(a) relationship
``where the language unequivocally indicates that (1) the union
requested recognition as the majority or 9(a) representative of the
unit employees; (2) the employer recognized the union as the majority
or 9(a) bargaining representative; and (3) the employer's recognition
was based on the union's having shown, or having offered to show,
evidence of its majority support.'' Id. at 720. The Board found that
this contract-based approach ``properly balances Section 9(a)'s
emphasis on employee choice with Section 8(f)'s recognition of the
practical realities of the construction industry.'' Id. at 719.
Additionally, the Board stated that under the Staunton Fuel test,
``[c]onstruction unions and employers will be able to establish 9(a)
bargaining relationships easily and unmistakably where they seek to do
so.''
---------------------------------------------------------------------------
\31\ NLRB v. Triple C Maintenance, Inc., 219 F.3d 1147 (10th
Cir. 2000), and NLRB v. Oklahoma Installation Co., 219 F.3d 1160
(10th Cir. 2000).
---------------------------------------------------------------------------
On review of a subsequent Board case applying Staunton Fuel, the
United States Court of Appeals for the District of Columbia Circuit
sharply disagreed with the Board's analysis.\32\ Relying heavily on the
majoritarian principles emphasized by the Supreme Court in Int'l
Ladies' Garment Workers' Union v. NLRB, 366 U.S. 731 (1961), the D.C.
Circuit stated that ``[t]he proposition that contract language standing
alone can establish the existence of a section 9(a) relationship runs
roughshod over the principles established in Garment Workers, for it
completely fails to account for employee rights under sections 7 and
8(f). An agreement between an employer and union is void and
unenforceable, Garment Workers holds, if it purports to recognize a
union that actually lacks majority support as the employees' exclusive
representative. While section 8(f) creates a limited exception to this
rule for pre-hire agreements in the construction industry, the statute
explicitly preserves employee rights to petition for decertification or
for a change in bargaining representative under such contracts. 29
U.S.C. 158(f). The Board's ruling that contract language alone can
establish the existence of a section 9(a) relationship--and thus
trigger the three-year `contract bar' against election petitions by
employees and other parties--creates an opportunity for construction
companies and unions to circumvent both section 8(f) protections and
Garment Workers' holding by colluding at the expense of employees and
rival unions. By focusing exclusively on employer and union intent, the
Board has neglected its fundamental obligation to protect employee
section 7 rights, opening the door to even more egregious violations
than the good faith mistake at issue in Garment Workers.'' 330 F.3d at
536-537.
---------------------------------------------------------------------------
\32\ Nova Plumbing, Inc. v. NLRB, 330 F.3d 531 (D.C. Cir. 2003),
granting review and denying enforcement of Nova Plumbing, Inc., 336
NLRB 633 (2001).
---------------------------------------------------------------------------
Notwithstanding the court's criticism in Nova Plumbing, and that of
a dissenting Board member subsequently agreeing with the court,\33\ the
Board has adhered to Staunton Fuel's holding that certain contract
language, standing alone, can establish an 9(a) relationship in the
construction industry. The D.C. Circuit has adhered as well to the
contrary view. In Colorado Fire Sprinkler, Inc. v. NLRB, 891 F.3d 1031
(2018), the court granted review and vacated a Board order premised on
the finding that a bargaining relationship founded under Section 8(f)
became a 9(a) relationship solely as a consequence of recognition
language in a successor bargaining agreement executed by the parties.
The court reemphasized its position in Nova Plumbing that the Staunton
Fuel test could not be squared either with Garment Workers'
majoritarian principles or with the employee free choice principles
represented by Section 8(f)'s second proviso. It also focused more
sharply on the centrality of employee free choice in determining when a
Section 9(a) relationship has been established. The court observed that
``[t]he raison d'[ecirc]tre of the National Labor Relations Act's
protections for union representation is to vindicate the employees'
right to engage in collective activity and to empower employees to
freely choose their own labor representatives.'' \34\ Further, the
court emphasized that ``[t]he unusual Section 8(f) exception is meant
not to cede all employee choice to the employer or union, but to
provide employees in the inconstant and fluid construction and building
industries some opportunity for collective representation. . . . [I]t
is not meant to force the employees' choices any further than the
statutory scheme allows.'' \35\ Accordingly, ``[b]ecause the statutory
objective is to ensure that only unions chosen by a majority of
employees enjoy Section 9(a)'s enhanced protections, the Board must
faithfully police the presumption of Section 8(f) status and the strict
burden of proof to overcome it. Specifically, the Board must demand
clear evidence that the employees--not the union and not the employer--
have independently chosen to transition away from a Section 8(f) pre-
hire arrangement by affirmatively choosing a union as their Section
9(a) representative.'' \36\ Pursuant to that strict evidentiary
standard, the court found that it would not do for the Board to rely
under Staunton Fuel solely on contract language ``indicating that the
employer's recognition was based on the union's having shown, or having
offered to show, an evidentiary basis of its majority support.'' \37\
Such reliance ``would reduce the requirement of affirmative employee
support to a word game controlled entirely by the union and employer.
Which is precisely what the law forbids.'' \38\
---------------------------------------------------------------------------
\33\ King's Fire Protection, Inc., 362 NLRB 1056, 1058-1063
(2015) (Member Miscimarra, dissenting).
\34\ Id. at 1038 (emphasis in original).
\35\ Id. at 1039.
\36\ Id.
\37\ Staunton Fuel, 335 NLRB at 717.
\38\ Colorado Fire Sprinkler, Inc. v. NLRB, 891 F.3d at 1040.
---------------------------------------------------------------------------
II. Statutory Authority and Desirability of Rulemaking
Section 6 of the Act provides that ``[t]he Board shall have
authority from time to time to make, amend, and rescind, in the manner
prescribed by subchapter II of chapter 5 of Title 5 [the Administrative
Procedure Act], such rules and regulations as may be necessary to carry
out the provisions of this Act.'' The Board interprets Section 6 as
authorizing the proposed rules and invites comments on this issue.
Although the Board historically has made most substantive policy
determinations through case adjudication, the Board has, with Supreme
Court approval, engaged in substantive rulemaking. American Hospital
Assn. v. NLRB, 499 U.S. 606 (1991) (upholding Board's rulemaking on
appropriate bargaining units in the healthcare industry); see also NLRB
v. Bell Aerospace Co., 416 U.S. 267, 294 (1974) (``[T]he choice between
rulemaking and adjudication lies in the first instance within the
Board's discretion.'').
The Board finds that informal notice-and-comment rulemaking with
respect to the election bar policies at issue here is desirable for
three important reasons.
First, rulemaking presents the opportunity to solicit broad public
comment on, and to address in a single proceeding, three related
election bar issues that would not likely arise in the adjudication of
a single case. By engaging in rulemaking after receiving public comment
on the issues
[[Page 39937]]
presented, the Board will be better able to make an informed judgment
as to the impact the current bar policies have had on employee free
choice.
Second, rulemaking does not depend on the participation and
argument by parties in a specific case, and it cannot be mooted by
developments in a pending case. For example, in Loshaw Thermal
Technology, LLC, Case 05-CA-158650, the Board recently sought public
input on the issue of what proof should be required to establish a
majority-supported Section 9(a) bargaining relationship in the
construction industry by issuing a notice and invitation to file
briefs. 2018 WL 4357198 (September 11, 2018). The Charging Party Union
in that case thereafter filed a request to withdraw its charge. The
Board granted the request by unpublished order issued on December 14,
2018, 2018 WL 6616458, thus precluding the possibility of addressing
the issue presented through adjudication until such unforeseen time as
it might be raised in a new case.
Third, by establishing the new election bar standards in the
Board's Rules & Regulations, employers, unions, and employees will be
able to plan their affairs free of the uncertainty that the legal
regime may change on a moment's notice (and possibly retroactively)
through the adjudication process. NLRB v. Wyman-Gordon Co., 394 U.S.
759, 777 (1969) (``The rule-making procedure performs important
functions. It gives notice to an entire segment of society of those
controls or regimentation that is forthcoming.'') (Douglas, J.,
dissenting).
III. The Proposed Rule Amendments
Substitution of a Vote and Impound Procedure for Current Blocking
Charge Policy
The Board is inclined to believe, subject to comments, that the
current blocking charge policy impedes, rather than protects, employee
free choice. In a significant number of cases, the policy denies
employees the right to have their votes, in a Board-conducted election
on questions concerning representation, ``recorded accurately,
efficiently, and speedily.'' \39\ In particular, statistical evidence
over several decades of Board elections undisputedly shows that the
blocking charge policy causes substantial delays in the conduct of
elections in which employees seek the opportunity to freely express
their choice with respect to whether they wish to continue being
represented by their incumbent union.
---------------------------------------------------------------------------
\39\ NLRB v. A.J. Tower Co., 329 U.S. at 331.
---------------------------------------------------------------------------
As the United States Court of Appeals for the D.C. Circuit has
stated, ``a decertification bar, whatever its duration, also prevents
employees from exercising their right to dislodge the union however
their sentiments about it may change. Decertification bars thus touch
at the very heart of employees' rights under the National Labor
Relations Act.'' \40\ Although the court made this observation when
criticizing the Board's rote issuance of a remedial affirmative
bargaining order for an employer's unlawful withdrawal of recognition
from an incumbent union, it applies with equal force to the effect of a
rote application of the current blocking charge policy on RD petitions,
as well as RM petitions and rival union RC petitions seeking an
electoral referendum on an incumbent union's continuing majority
support.
---------------------------------------------------------------------------
\40\ Caterair International v. NLRB, 22 F.3d 1114, 1122 (1994).
---------------------------------------------------------------------------
The breadth of the current blocking charge policy and the
significant length of delay in processing these otherwise valid
election petitions raise several serious concerns. First, employees who
support those petitions are just as adversely affected by delay as
employees who support a union's initial petition to become an exclusive
bargaining representative. Delay robs the petition effort of momentum
and, if an election is delayed for months or years--as is often the
case when elections are blocked--many of the employees ultimately
voting on the issue of representation may not even be the same as those
in the workforce when the petition was filed. Second, the blocking
charge policy rests on a presumption that an unlitigated and unproven
allegation of any of a broad range of unfair labor practices justifies
indefinite delay because of a discretionary administrative
determination of the potential impact of the alleged misconduct on
employees' ability to cast a free and uncoerced vote on the question of
representation. This presumption goes well beyond the presumption
underlying the Board's affirmative remedial bargaining order policy of
barring an election for a reasonable period of time until the lingering
effects of certain proven and more narrowly defined unfair labor
practices can be abated.\41\ Third, as the dissenters to the Election
Rule observed, the current policy of holding petitions in abeyance for
certain pre-petition Type I blocking charges ``represents an anomalous
situation in which some conduct that would not be found to interfere
with employee free choice if alleged in objections, because it occurs
outside the critical election period, would nevertheless be the basis
for substantially delaying holding any election at all.'' \42\
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\41\ Even that remedial presumption of taint is not without its
critics. See Lee Lumber & Bldg. Material Corp. v. NLRB, 117 F.3d
1454, 1463 (D.C. Cir. 1997) (Sentelle, J., concurring) (``To presume
that employees are such fools and sheep that they have lost all
power of free choice based on the acts of their employer, bespeaks
the same sort of elitist Big Brotherism that underlies the
imposition of the invalid bargaining order in this case.'').
\42\ 79 FR 74456, citing Ideal Electric Mfg. Co., 134 NLRB 1275
(1961) (to be found objectionable, alleged conduct must occur during
critical period between petition and election dates).
---------------------------------------------------------------------------
For the foregoing reasons, and in light of the various criticisms
voiced by courts, academicians, commenters to the 2014 NPRM, dissenters
to the 2014 Final Rule, and responders to the 2017 Request for
Information, the Board believes, subject to comments, that the current
blocking charge policy should not be maintained. Although the 2014
Election Rule addition of Section 103.20 made some effort to address
concerns about unmeritorious charges needlessly delaying Board-
conducted elections, the Board is inclined, subject to comments, to
institute more substantial measures to protect employee free choice and
ensure that employees are able to realize their right to have their
votes ``recorded accurately, efficiently, and speedily.'' \43\
---------------------------------------------------------------------------
\43\ NLRB v. A.J. Tower Co., 329 U.S. at 331. As indicated in
fn. 4 above, the Board disagrees with observations by both the
majority and dissent in their respective discussions of the 2014
Election Rule that the blocking charge policy was incorporated into
or embedded in that rule. Sec. 103.20 incorporates only certain
evidentiary procedures to be applied to blocking charges. Although
the majority clearly endorsed the current blocking charge policy,
determination of whether and when a blocking charge policy should
apply is not addressed in the 2014 Election Rule. It remains a
product of adjudication outside the Board's Rules, details of which
are summarized in the General Counsel's nonbinding Casehandling
Manual.
---------------------------------------------------------------------------
Having preliminarily reviewed numerous suggestions for revision or
elimination of this policy, the Board proposes to adopt the vote and
impound procedure suggested by the General Counsel in response to the
2017 Request for Information. Under this new policy, as set forth in an
amended Section 103.20 of the Rules, regional directors will continue
to process a representation petition and will conduct an election even
when an unfair labor practice charge and blocking request have been
filed. If the charge has not been resolved prior to the election, the
ballots will remain impounded until the Board makes a final
determination regarding the charge. As further explained by the General
Counsel: ``Adoption of a vote-and-impound protocol while the region
investigates a charge would allow for balloting when
[[Page 39938]]
the parties' respective arguments are fresh in the mind of unit
employees. Balloting would occur with the understanding that
allegations have been proffered, regardless of whether probable cause
has been found; thus, neither the charging party nor the charged party
would be in control of the narrative underlying the election campaign.
Should the director find that the ULP charge is without merit, the
count and resulting tally of ballots could occur immediately, rather
than after a further delay while the petition is unblocked, an election
is either negotiated or directed, the mechanics of the pre-election
period dispensed with, and balloting take place. Moreover, any burden
in conducting elections created where the ballots may never be counted
is more than offset by the benefit of preserving employees' free
choice. Indeed, the preservation of employee free choice through a vote
and impound procedure far outweighs any other concerns.'' \44\
---------------------------------------------------------------------------
\44\ General Counsel's April 18, 2018 response to the Board's
Request for Information regarding the 2014 Election Rule, p. 2,
available for viewing on the Board's public website at https://www.nlrb.gov/reports-guidance/public-notices/request-information/submissions.
---------------------------------------------------------------------------
The Board believes, subject to comment, that the proposed vote-and-
impound rule best satisfies the goal of protecting employee free choice
in cases where, under existing policy, the election would be blocked by
assuring that petitions will be processed to an election in the same
timely manner as in unblocked petition cases. The concern for
protection of that choice from coercion by unfair labor practices will
still be met by holding the counting of ballots and certification of
results until a final determination has been made as to the merits of
the unfair labor practice allegations and the effects on the election
of any violations found to have been committed.
Modification To Current Immediate Voluntary Recognition Bar
The Board proposes, subject to comments, to overrule Lamons Gasket,
to reinstate the Dana notice and open period procedures following
voluntary recognition under Section 9(a), and to incorporate those
procedures in the Rules as a new Section 103.21(a). This modification
to the current immediate voluntary recognition bar is not intended to
and should not have the effect of discouraging parties from entering
into collective-bargaining relationships and agreements through the
undisputedly valid procedure of voluntary recognition based on a
contemporaneous showing of majority support. However, the Board
believes, subject to comments, that the justifications expressed in the
Dana Board majority and Lamons Gasket dissenting opinions for the
limited post-recognition notice and open period requirements are more
persuasive than those expressed by the Lamons Gasket Board majority in
support of an immediate voluntary recognition bar.
It is undisputed that ``secret elections are generally the most
satisfactory--indeed the preferred--method of ascertaining whether a
union has majority support.'' NLRB v. Gissel Packing Co., 395 U.S. at
602. Although voluntary recognition is a valid method of obtaining
recognition, authorization cards used in a card-check recognition
process are ``admittedly inferior to the election process.'' Id. at
603. The Board believes that the Lamons Gasket majority failed to
accept this distinction or the several reasons, summarized above,
articulated by the Dana majority supporting it. Further, the Board
believes that the Lamons Gasket majority failed to address at all the
cumulative effect of an immediate recognition bar and a subsequent
contract bar that would apply if parties execute a collective-
bargaining agreement during the six-month to one-year reasonable
bargaining period following the first bargaining session following
voluntary recognition. In this circumstance, employees denied an
initial opportunity to vote in a secret-ballot Board election on the
question of representation could be denied that opportunity for as many
as four years.\45\
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\45\ Indeed, because the reasonable period for bargaining runs
from the date of the first bargaining session following voluntary
recognition, and because parties often need time following voluntary
recognition to formulate their positions before they meet and
bargain, the combination of immediate voluntary recognition bar
followed by contract bar could deny employees a vote on the question
of representation for more than four years.
---------------------------------------------------------------------------
The Board also believes, in agreement with the Lamons Gasket
dissent, that the Board election statistics cited by the Lamons Gasket
majority with respect to the limited number of elections held under
Dana procedures support, rather than detract from, the need for a
notice and brief open period following voluntary recognition. ``In sum,
here is what we really know from the Dana experience: (1) Dana has
served the intended purpose of assuring employee free choice in those
cases where the choice made in the preferred Board electoral process
contradicted the showing on which voluntary recognition was granted;
(2) in those cases where the recognized union's majority status was
affirmed in a Dana election, the union gained the additional benefits
of 9(a) certification, including a 1-year bar to further electoral
challenge; (3) there is no substantial evidence that Dana has had any
discernible impact on the number of union voluntary recognition
campaigns, or on the success rate of such campaigns; and (4) there is
no substantial evidence that Dana has had any discernible impact on the
negotiation of bargaining agreements during the open period or on the
rate at which agreements are reached after voluntary recognition.''
\46\
---------------------------------------------------------------------------
\46\ Lamons Gasket, 357 NLRB at 751.
---------------------------------------------------------------------------
In conclusion, the Board believes, subject to comments, that it is
necessary and appropriate to modify the current voluntary recognition
bar doctrine by reestablishing through rulemaking a post-recognition
period in which employees and rival unions are permitted to file an
election petition before the imposition of an election bar. This
modification does not diminish the role that voluntary recognition
plays in the creation of bargaining relationships but ensures that
employee free choice has not been impaired by a process that is less
reliable than Board elections.
Modified Requirements for Proof of Section 9(a) Relationships in the
Construction Industry
The Board proposes, subject to comments, to overrule Staunton Fuel,
to adopt the D.C. Circuit's position that contract language alone
cannot create a 9(a) bargaining relationship in the construction
industry, and to incorporate the requirement of extrinsic proof of
contemporaneous majority support in a new Section 103.21(b) of the
Board's Rules. The Board believes that several reasons support this
change. First, as emphasized by the D.C. Circuit opinion in Colorado
Fire Sprinkler, the Staunton Fuel test literally permits an employer
and union to ``paper over'' the Deklewa presumption that collective-
bargaining relationships in the construction industry are governed by
Section 8(f), under the second proviso to which a Board election cannot
be barred at any time. Second, the Staunton Fuel test goes one step
beyond the problems described above with respect to the current
voluntary recognition election bar. At least under the recognition bar
policy as applied outside the construction industry, there is
undisputed proof of employee majority support, through union
authorization cards or a pro-union petition, when the union and
employer enter into a bargaining relationship. Under Staunton Fuel, an
initial bargaining relationship
[[Page 39939]]
under Section 8(f) may become a Section 9(a) relationship at any time
after the hiring of employees if the employer and union execute a
contract with the prescribed Section 9(a) recognition language. Thus,
without any extrinsic proof that a majority of those employees ever
supported the recognized union, the current contract bar policy will
prevent them, or a rival union, from filing a Board election petition
to challenge the union's representative status for up to three years of
the contract's duration. Third, the 8(f) to 9(a) ``conversion''
permitted under Staunton Fuel is similar to the flawed ``conversion
doctrine'' that Deklewa repudiated. Finally, and most importantly, the
Board believes, subject to comments, that the repeated criticisms
voiced by the D.C. Circuit raise a legitimate concern that the current
Staunton Fuel test conflicts with statutory majoritarian principles and
represents an impermissible restriction on employee free choice,
particularly in light of the protections intended by the second proviso
of Section 8(f).
The Board believes, subject to comments, that the proposed rule
requiring positive evidence, apart from contract language, that a union
unequivocally demanded recognition as the Section 9(a) exclusive
bargaining representative of employees in an appropriate bargaining
unit, and that the employer unequivocally accepted it as such, based on
a contemporaneous showing of support from a majority of employees in an
appropriate unit, will restore the protections of employee free choice
in the construction industry that Congress intended, that Deklewa
sought to secure, and that the D.C. Circuit insists must be restored.
IV. Response to the Dissent
Here, in a nutshell, is our colleague's dissent: She likes the
present state of law on the issues raised, particularly because it
accords with the views of a prior Board majority that had no hesitation
about overruling numerous Board precedents on their own initiative on
issues where the results were not to their liking.\47\ She has
chastised the current Board on innumerable occasions for failing to
seek public input prior to overruling precedent, yet she claims we have
no right to seek that input on the three issues for which we here seek
broad comment. She contends, quite incorrectly, that the well-
established standard for determining whether rulemaking is reasoned or
arbitrary should be applied at the beginning of the process, prior to
the issuance of an NPRM, rather than in judicial review of the end
result of the process, after issuance of a Final Rule based on results
from the notice-and-comment process. Moreover, she treats each proposal
we make in the NPRM as sui generis, lacking any basis in the prior
academic, judicial, or internal Board criticisms that we have cited,
which she either ignores or summarily rejects.
---------------------------------------------------------------------------
\47\ In addition to Lamons Gasket, supra, see United States
Postal Service, 364 NLRB No. 116 (2016); E.I. Du Pont de Nemours,
364 NLRB No. 113 (2016); Total Security Management Illinois 1, LLC,
364 NLRB No. 106 (2016); Trustees of Columbia University, 364 NLRB
No. 90 (2016): Miller & Anderson, Inc., 364 NLRB No. 39 (2016);
Graymont PA, Inc., 364 NLRB No. 37 (2016); Loomis Armored US, Inc.,
364 NLRB No. 23 (2016); Guardsmark, LLC, 363 NLRB No. 103 (2016);
Lincoln Lutheran of Racine, 362 NLRB 1655 (2015); Browning-Ferris
Industries of California, Inc., d/b/a BFI Newby Island Recyclery,
362 NLRB 1599 (2015); Piedmont Gardens, 362 NLRB 1135 (2015);
Babcock & Wilcox Construction Co., Inc., 361 NLRB 1127 (2014);
Purple Communications, Inc., 361 NLRB 1050 (2014); Pressroom
Cleaners, 361 NLRB 643 (2014); FedEx Home Delivery, 361 NLRB 610
(2014); and UGL-UNICCO Service Co., 357 NLRB 801 (2011). The 2014
Election Rule also overruled precedent previously established in
case adjudication.
---------------------------------------------------------------------------
We need go no further in discussing the details of the dissent,
other than to note that we already have her predetermined opinion about
the proposals, regardless of what comments or further analysis may
ensue.
V. Dissenting View of Member Lauren McFerran
The majority today presents a wide-ranging proposal to radically
remake three longstanding Board policies via rulemaking: (1) The
blocking charge doctrine, which protects employee free choice by
permitting the Board to delay a union-representation election in the
face of unfair labor practice allegations; (2) the voluntary
recognition bar doctrine, which encourages collective bargaining and
promotes industrial stability by allowing a union--after being
voluntarily recognized by an employer--to represent employees for a
certain period without being subject to challenge; and (3) the Staunton
Fuel doctrine, which both preserves and encourages collective-
bargaining relationships by permitting a union in the construction
industry to establish its majority status by pointing to certain
language in its collective-bargaining agreement with the employer. Each
of the majority's proposed changes would make it harder for employees
to get, or to keep, union representation. It is common knowledge that
the Board's limited resources are severely taxed by undertaking a
rulemaking process, instead of deciding cases already waiting for Board
action.\48\ And while rulemaking can potentially be a useful tool in
appropriate circumstances,\49\ the Board should not undertake this
arduous process without proper justification. Finally, of course, the
rules it adopts should actually further the goals of the National Labor
Relations Act, not undermine them.
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\48\ See, e.g., Jeffrey M. Hirsch, Defending the NLRB: Improving
the Agency's Success in the Federal Courts of Appeals, 5 FIU L. Rev.
437, 457 (2010) (explaining that rulemaking at the Board would
consume significant resources, especially ``given that the NLRB is
banned from hiring economic analysts'').
\49\ For example, in my dissent in The Boeing Company, 365 NLRB
No. 154, slip op. at 43 (2017) (dissenting opinion), I suggested
that the Board should have considered formulating model rules rather
than using adjudication to making sweeping categorical
determinations about the lawfulness of rules not presented in the
case at hand.
---------------------------------------------------------------------------
The impetus for the majority's project is difficult to discern.
Certainly, today's proposal--though purporting to address
representation case procedures--is not responsive to the Board's 2014
Election Rule, which included only modest revisions to the Board's
blocking charge policy and did not implicate the other two issues
raised here. Tellingly, only a very small number of responses to the
Board's 2017 Request for Information regarding election regulations
even touched on the subjects of this Notice. Nor are there rulemaking
petitions pending on any of these issues. Indeed, it appears that this
initiative--which pieces together three seemingly unconnected
proposals--exists primarily as a vehicle for the majority to alter
precedents that have not presented themselves for the Board's attention
in the normal course of adjudication (or at least not as quickly as the
majority would like).\50\
---------------------------------------------------------------------------
\50\ Notably, in Loshaw Thermal Technology, LLC, 05-CA-158650,
the Board requested public briefing on one of the issues presented
here--namely, whether Section 9(a) bargaining relationships in the
construction industry may be established by contract language alone.
That request for briefing was suspended and ultimately rescinded
after the charging party union withdrew the underlying unfair labor
practice charge. The Board has not been presented with another case
addressing the issue.
---------------------------------------------------------------------------
More questionable than the proposal's origin, however, is the
majority's thin justification for revisiting the law. Quite simply, the
majority cannot change the law in these three areas just because it
wants to. As the Supreme Court has long recognized, ``A `settled course
of [agency] behavior embodies the agency's informed judgment that, by
pursuing that course, it will carry out the policies committed to it by
Congress.' '' Motor Vehicle Manufacturers Association of the United
States, Inc. v. State Farm Mutual Automobile Insurance Co., 463 U.S.
29, 41-42 (1983) (quoting Atchison,
[[Page 39940]]
T. & S. F. Ry. Co. v. Wichita Bd. of Trade, 412 U.S. 800, 807 (1973).
It follows, therefore, that when an agency seeks to change its policy--
particularly long-settled policy--the agency must provide a ``reasoned
explanation'' for why it is changing the policy and ``must show that
there are good reasons for the new policy.'' FCC v. Fox Television
Stations, Inc., 556 U.S. 502, 514-515 (2009). Such an explanation must
address the agency's reasons for `` `disregarding facts and
circumstances . . . that underlay . . . the prior policy.' '' \51\
---------------------------------------------------------------------------
\51\ Encino Motorcars, LLC v. Navarro,--U.S.--,136 S. Ct. 2117
at 2126 (2016), quoting FCC, 556 U.S. at 515-516.
---------------------------------------------------------------------------
The majority's proposal, at least at this stage of the proceedings,
fails to meet even minimal standards of reasoned decisionmaking. The
proposal relies on faulty premises, fails to ask critical questions,
and fails to analyze the relevant data and agency experience.
First, the majority proposes to eliminate the Board's blocking
charge policy--an 80-year old doctrine under which the Board may
decline to process election petitions over party objections when there
are pending unfair labor practice charges that would potentially taint
the election environment. In its place, the majority would implement a
vote-and-impound procedure that would require regional directors to
process all election petitions and hold elections no matter how serious
the pending unfair labor practice charges and no matter how powerful
the indicia of their merit. The admitted result of the new policy would
be to require regional directors to run--and employees, unions, and
employers to participate in--elections conducted under coercive
conditions that interfere with employee free choice.
Unfortunately, it does not appear that the majority has done any of
the rigorous analytical work that should be involved in pursuing such a
dramatic change in Board law. My colleagues have not asked critical
questions about blocked petitions, and they have failed to analyze
relevant, available data about how the blocking charge policy works in
practice and the effect of the proposed vote-and-impound procedure if
adopted. The result is an unjustified policy change that would
unacceptably undermine employee free choice and the policies of the
Act.
Second, the majority proposes to radically alter the Board's
voluntary recognition bar doctrine, which currently provides that an
employer's voluntary recognition of a union insulates the union from an
election challenge for a reasonable period of time, to permit
collective bargaining. Instead, the majority would reinstate the
Board's discredited and short-lived Dana approach, establishing a 45-
day ``window period'' after voluntary recognition during which
employees may file a decertification petition supported by a 30-percent
showing of interest. Here, the majority again seeks to upend a well-
established Board doctrine--supported by over 50 years of caselaw--
without presenting any new policy justifications, legal grounds, or
evidentiary support on the side of its position. In its place, the
majority would implement an approach that the Board had previously
repudiated in a carefully-considered, evidence-based decision. The
result of the majority's proposal is contrary to the policies of the
Act--discouraging the establishment of stable collective bargaining
relationships by creating unnecessary procedural hurdles undermining a
union that has already lawfully secured recognition.\52\
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\52\ This is not the first time the current majority has made
changes--or signaled its intent to make changes--the primary effect
of which is to make it easier to oust lawfully-recognized unions.
See, e.g., Silvan Industries, 367 NLRB No. 28 (2018) (undermining
the Board's contract bar doctrine); see also Bay at North Ridge
Health and Rehabilitation Center, LLC, 18-RD-208565 (Feb. 14, 2018)
and Apple Bus Co., 19-RD-203378 (Dec. 14, 2017) (noting current
majority members' disagreement with the successor bar doctrine).
---------------------------------------------------------------------------
Finally, the majority proposes to discard the 18-year-old Staunton
Fuel doctrine and instead adopt a rule providing that, in the
construction industry, neither voluntary recognition of the union by
the employer nor a collective-bargaining agreement between the parties
will bar election petitions filed under Section 9(c) or 9(e) of the Act
``absent positive evidence'' (as detailed in the rule) that the
collective-bargaining relationship was established under the majority-
support requirement of Section 9(a) of the Act. As I will explain, the
majority's proposal--which runs counter to well-established Board law
in unfair labor practice cases--purports to solve a non-existent
problem, while failing adequately to acknowledge the actual problem
that Staunton Fuel was intended to address.
Almost everything about today's initiative--from the lack of
justification for rulemaking, to the near-random grouping of unrelated
topics, to the poorly conceptualized proposals--seems arbitrary.
Moreover, all of the majority's proposals, if implemented, would run
contrary to the stated goals of the Act, which is intended to
``encourag[e] the practice and procedure of collective bargaining'' and
to ``protect[ ] the exercise by workers of . . . designation of
representatives of their own choosing, for the purpose of negotiating
the terms and conditions of their employment'' (in the words of Section
1). For all of these reasons, I dissent from the majority's decision to
issue the notice of proposed rulemaking (NPRM).
A. Blocking Charge Policy
It is a foundational principle of United States labor law that when
a petition is filed with the Board seeking an election to enable
employees to decide whether they wish to be represented by a union, the
Board's paramount role in overseeing the process is to protect employee
free choice. By definition, a critical part of protecting employee free
choice is ensuring that employees are able to vote in an atmosphere
free of coercion, so that the results of the election accurately
reflect the employees' true desires concerning representation.
There is general agreement that, under ordinary circumstances, the
Board should conduct elections expeditiously. However, as anyone
remotely familiar with the history of the National Labor Relations Act
is aware, Board volumes are filled with cases describing unlawful
conduct that interferes with the ability of employees to make a free
choice about union representation in an election. Accordingly, for more
than 80 years, the Board has maintained a ``blocking charge policy''
whereby the Board may (at least temporarily) decline to process
election petitions over party objections when there are pending unfair
labor practice charges alleging conduct that would interfere with
employee free choice until the merits of those charges are resolved.
In cases where the charges prove meritorious and there has been
conduct that would interfere with employee free choice in an election,
the blocking charge policy protects employee free choice by delaying
the election until those unfair labor practices have been remedied and
employees can register a free and untrammeled choice for or against
union representation. At the same time, the blocking charge policy also
respects the rights of employees in the subset of cases where the
charges are subsequently found to lack merit, because the policy
provides for regional directors to resume processing those petitions to
elections.
Today, the majority abruptly proposes to jettison the blocking
charge policy adhered to by Boards of differing perspectives for more
than 8 decades. The majority proposes to replace the
[[Page 39941]]
blocking charge policy with a vote-and-impound procedure that will
require regional directors to process all petitions to elections--no
matter how serious the pending unfair labor practice charges, and even
if a regional director and an administrative law judge have determined
those charges to have merit--unless there has been a ``final
determination by the Board'' itself. In other words, as my colleagues
implicitly concede, the proposed vote-and-impound procedure will
require regional directors to run--and employees, unions, and employers
to participate in--elections conducted under coercive conditions that
interfere with employee free choice. This would be a shocking
abdication of the Board's statutory duties.
As currently drafted and justified, the majority's proposal to
replace the blocking charge policy with a vote-and-impound procedure
reflects a failure to engage in the sort of reasoned decision-making
demanded of the Board and other administrative agencies. My colleagues
have not laid even the basic foundation for a rulemaking supported by
substantial evidence. They have assumed the existence of a problem and
rushed to a solution without doing any of the rigorous analytical work
that should be involved in the rulemaking process. They have not asked
critical questions about blocked petitions, and they have failed to
analyze relevant, available data about how the blocking charge policy
has worked in practice and how the proposed vote-and-impound procedure
would work if adopted.
Not surprisingly, from this flawed process a flawed proposal has
emerged. The Board's experience and data shows that the predictable
outcome of the majority's proposal would be to require regional
directors to run, and employees, unions, and employers to participate
in, an unacceptably high proportion of elections conducted under
coercive conditions, undermining employee rights and the policies of
the Act, while imposing unnecessary costs on the parties and the Board.
1.
Section 7 of the Act grants employees ``the right to self-
organization, to form, join, or assist labor organizations, to bargain
collectively through representatives of their own choosing, and to
engage in other concerted activities for the purposes of collective
bargaining or other mutual aid or protection[.]'' 29 U.S.C. 157. The
most commonly travelled route for employees to union representation is
through the Board's election processes. Indeed, it has been said--and
the majority repeats today--that a secret-ballot election is the
Board's preferred route, because a secret-ballot election conducted
under the Board's safeguards is normally the most reliable means of
determining whether employees truly desire union representation.
Section 7 also grants employees the right to refrain from union
activity, and previously represented employees may become unrepresented
in a variety of ways. For example, when presented with evidence that an
incumbent union no longer has majority backing, an employer sometimes
may withdraw recognition from the union and refuse to bargain. See
Allentown Mack Sales & Service, Inc. v. NLRB, 522 U.S. 359, 361 (1998).
However, a secret-ballot election conducted under the Board's
safeguards is also the ``preferred'' means of determining whether
employees truly desire to rid themselves of their incumbent
representative. See, e.g., Scomas of Sausalito, LLC v. NLRB, 849 F.3d
1147, 1152 (D.C. Cir. 2017) (quoting Levitz Furniture Co. of the
Pacific, 333 NLRB 717, 723, 725-727 (2001) (``Levitz'')).\53\
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\53\ The Act permits employees to petition for an election to
decertify an incumbent collective-bargaining representative. 29
U.S.C. 159(c)(1)(A)(ii). And employers who doubt the majority
support of incumbent unions may themselves petition for elections at
an appropriate time as well. See Levitz, 333 NLRB at 720-721 & n.24.
---------------------------------------------------------------------------
Because the Act calls for freedom of choice by employees as to
whether to obtain, or retain, union representation, the Board has long
recognized that ``[i]n election proceedings, it is the Board's function
to provide a laboratory in which an experiment may be conducted, under
conditions as nearly ideal as possible, to determine the uninhibited
desires of the employees.'' General Shoe Corp., 77 NLRB 124, 126-127
(1948) (a Board conducted election ``can serve its true purpose only if
the surrounding conditions enable employees to resister a free and
untrammeled choice for or against a bargaining representative.'').
Indeed, as the Supreme Court has recognized, it is the ``duty of the
Board . . . to establish `the procedure and safeguards necessary to
insure the fair and free choice of bargaining representatives by
employees.' '' NLRB v. Savair Mfg. Co., 414 U.S. 270, 276 (1973)
(emphasis added) (citation omitted).
Since the earliest days of the Act, the Board has had a policy--
commonly referred to as the blocking charge policy--of generally
declining to process a petition to an election over party objections
when unfair labor practice charges allege conduct that, if proven,
would interfere with employee free choice in an election.\54\ The
rationale for the blocking charge policy is straightforward: It is
``premised solely on the [Board's] intention to protect the free choice
of employees in the election process.'' NLRB Casehandling Manual (Part
Two), Representation Proceedings Section 11730 (2017). ``The Board's
policy of holding the petition in abeyance in the face of pending
unfair labor practices is designed to preserve the laboratory
conditions that the Board requires for all elections and to ensure that
a free and fair election can be held in an atmosphere free of any type
of coercive behavior.'' Mark Burnett Productions, 349 NLRB 706, 706
(2007). Indeed, the ability of regional directors to hold petitions in
abeyance when unfair labor practice charges allege conduct that would
interfere with employee free choice is one of the safeguards that
renders Board-conducted elections the preferred means of determining
whether employees wish to obtain, or retain, union representation.
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\54\ See United States Coal & Coke Co., 3 NLRB 398, 399 (1937).
See generally, The Developing Labor Law 561-63 (John E. Higgins,
Jr., ed., 5th edition 2006); 3d NLRB Ann. Rep. 143 (1938) (``The
Board has often provided that an election be held at such time as
the Board would thereafter direct in cases where the employer has
been found to have engaged in unfair labor practices and the Board
has felt that the election should be delayed until there has been
sufficient compliance with the Board's order to dissipate the
effects of the unfair labor practices and to permit an election
uninfluenced by the employer's conduct. Similarly, where charges
have been filed alleging that the employer has engaged in unfair
labor practices, the Board has frequently postponed the election
indefinitely pending the investigation and determination of the
charges.''); 13th NLRB Ann. Rep. 34 & fn. 90 (1948) (``Unremedied
unfair labor practices constituting coercion of employees are
generally regarded by the Board as grounds for vacating an
election[.] For this reason, the Board ordinarily declines to
conduct an election if unfair labor practice charges are pending or
if unfair labor practices previously found by the Board have not yet
been remedied[.]'').
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It is important to understand that, contrary to the majority's
suggestion, the mere filing of an unfair labor practice charge does not
automatically cause a petition to be held in abeyance under the
blocking charge policy. Casehandling Manual Sections 11730, 11731.\55\
Indeed, a regional director may
[[Page 39942]]
not block an election if a party has not first submitted an offer of
proof describing evidence that, if proven, would interfere with
employee free choice in an election. Section 103.20 of the Board's
Rules and Regulations provides that if the regional director determines
that the party's offer of proof ``does not describe evidence that, if
proven, would interfere with employee free choice in an election [. .
.], the regional director shall continue to process the petition and
conduct the election[.]'' In addition, the Board can decline to block
an immediate election despite a party's request that it do so when the
surrounding circumstances suggest that the party is using the filing of
charges as a tactic to delay an election without cause. See Columbia
Pictures Corp., 81 NLRB 1313, 1314-1315 fn. 9 (1949).\56\
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\55\ See Veritas Health Services, Inc. v. NLRB, 895 F.3d 69, 88
(D.C. Cir. 2018) (noting that pending unfair labor practice charges
do not necessarily preclude processing a representation petition).
For example, the Board has long declined to hold a petition in
abeyance if the pending unfair labor practice charge does not allege
conduct that would interfere with employee free choice in an
election. See, e.g., Holt Bros, 146 NLRB 383, 384 (1964) (rejecting
party's request that its charge block an election because even if
the charge in question were meritorious, it would not interfere with
employee free choice in the election).
\56\ The Board has also directed an immediate election, despite
pending charges, in order to hold the election within 12 months of
the beginning of an economic strike so as not to disenfranchise
economic strikers, American Metal Products Co., 139 NLRB 601, 604-
605 (1962), or in order to prevent harm caused to the economy by a
strike resulting from an unresolved question of representation, New
York Shipping Association, 107 NLRB 364, 375-376 (1953). The
Casehandling Manual sets forth other circumstances when regional
directors may decline to block petitions. Casehandling Manual
Section 11731.
---------------------------------------------------------------------------
Blocking charges fall into two broad categories. The first, called
Type I charges, encompasses charges that allege conduct that merely
interferes with employee free choice. Casehandling Manual at Section
11730.1. Examples of Type I charges include allegations of employer
threats to retaliate against employees if they vote in favor of union
representation or promises of benefits if employees vote against union
representation. Under the policy, when (1) a party to the
representation case requests that its unfair labor practice charge
block processing the petition, (2) the charge alleges conduct that, if
proven, would interfere with employee free choice in an election were
one to be conducted and is accompanied by a sufficient offer of proof,
and (3) the charging party promptly makes it witnesses available, the
charge should be investigated and either dismissed, withdrawn, or
remedied before the petition is processed to an election (unless, of
course, an exception is applicable). Id. at Sections 11730; 11730.2;
11733.1.
If upon completion of the investigation of the charge, the regional
director determines that the charge lacks merit and should be dismissed
absent withdrawal, the regional director resumes processing the
petition and conducts an election where appropriate. Id. at Section
11732. If the regional director determines that the Type I charge has
merit, the director refrains from conducting an election until the
charged party has taken all the remedial action required by the
settlement agreement, administrative law judge's decision, Board order,
or court judgment. Id. at Sections 11730.2; 11734.
The second broad category of blocking charges, called Type II
charges, encompasses charges that allege conduct that not only
interferes with employee free choice, but that also is inherently
inconsistent with the petition itself. Id. at Section 11730.1. Such
charges may block a related petition during the investigation of the
charges, because a determination of the merit of the charges may also
result in the dismissal of the petition. Id. at Section 11730.3.
Examples of Type II charges include allegations that an employer's
representative was directly involved in the initiation of a
decertification petition, or allegations of an employer's refusal to
bargain, for which the remedy is an affirmative bargaining order. Ibid.
If the regional director determines that the Type II charge has
merit, then the director may dismiss the petition, subject to a request
for reinstatement by the petitioner after final disposition of the
unfair labor practice case. A petition is subject to reinstatement if
the allegations in the unfair labor practice case, which caused the
petition to be dismissed, are ultimately found to be without merit. See
id. at Section 11733.2.\57\
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\57\ For either Type I or II charges, parties have the right to
request Board review of regional director determinations to hold
petitions in abeyance or to dismiss the petitions altogether. See 29
CFR 102.71(b); Casehandling Manual Sections 11730.7, 11733.2(b).
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Although the Board's application of the blocking charge policy in a
particular case has occasionally been set aside, no court has
invalidated the policy itself despite its long vintage. To the
contrary, the courts have recognized that the salutary reasons for the
blocking charge policy ``do not long elude comprehension,'' and that
the policy has ``long-since [been] legitimized by experience.'' Bishop
v. NLRB, 502 F.2d 1024, 1028, 1032 (5th Cir. 1974).\58\
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\58\ Accord Blanco v. NLRB, 641 F.Supp. 415, 417-418, 419
(D.D.C. 1986) (rejecting claim that Section 9 imposes on the Board a
mandatory duty to proceed to an election whenever a petition is
filed notwithstanding the pendency of unfair labor practice charges
alleging conduct that would interfere with employee free choice in
an election, and holding that the use of the blocking charge rule
was ``in accord with the Board's policy to preserve the `laboratory
conditions' necessary to permit employees to cast their ballots
freely and without restraint or coercion.''). See also Remington
Lodging & Hospitality, LLC v. Ahearn, 749 F.Supp.2d 951, 960-961 (D.
Alaska 2010) (``where a petition to decertify the union is related
to the ULP charges, the `blocking charge rule' prioritizes the
agency's consideration of the ULP charges to ensure that any
decertification proceedings are handled in an uncoerced
environment.''). Cf. NLRB v. Gissel Packing Co., Inc., 395 U.S. 575,
591-592, 594, 597, 600-602, 610-611 (1969) (Board properly withholds
an election when employer has committed serious unfair labor
practices disruptive of the election process).
---------------------------------------------------------------------------
As the Fifth Circuit explained in Bishop, 502 F.2d at 1028-1029:
It would be particularly anomalous, and disruptive of industrial
peace, to allow the employer's (unfair labor practices) to dissipate
the union's strength, and then to require a new election which
`would not be likely to demonstrate the employees' true, undistorted
desires,' since employee disaffection with the union in such cases
is in all likelihood prompted by (the situation resulting from the
unfair labor practices).
If the employer has in fact committed unfair labor practices and
has thereby succeeded in undermining union sentiment, it would
surely controvert the spirit of the Act to allow the employer to
profit by his own wrongdoing. In the absence of the `blocking
charge' rule, many of the NLRB's sanctions against employers who are
guilty of misconduct would lose all meaning. Nothing would be more
pitiful than a bargaining order where there is no longer a union
with which to bargain.
Nor is the situation necessarily different where the
decertification petition is submitted by employees instead of the
employer or a rival union. Where a majority of the employees in a
unit genuinely desire to rid themselves of the certified union, this
desire may well be the result of the employer's unfair labor
practices. In such a case, the employer's conduct may have so
affected employee attitudes as to make a fair election impossible.
If the employees' dissatisfaction with the certified union
should continue even after the union has had an opportunity to
operate free from the employer's unfair labor practices, the
employees may at that later date submit another decertification
petition.
2.
Today, however, the majority seeks to jettison this 80-year old
policy. The majority proposes that the Board no longer block any
petition because of pending unfair labor practice charges. No matter
how serious the charge (even if it alleges conduct that if proven would
require the petition's dismissal); no matter how powerful the indicia
of the charge's merit (even if a regional director has issued a
complaint or a judge has issued a remedial order); no matter how
persistent the employer's coercive actions (even in the face of
repeated unfair labor practices over multiple campaigns), the Board
will always process petitions to elections
[[Page 39943]]
and impound the ballots pending Board resolution of the charges.\59\
---------------------------------------------------------------------------
\59\ The majority's proposal is thus is even more radical than
the position unsuccessfully advocated in 2014 by dissenting Members
Miscimarra and Johnson, who proposed a vote-and-impound procedure
merely for cases involving Type I blocking charges. 79 FR 74308,
74456 (Dec. 15, 2014). The majority never explains whether it
considered this alternative, and, if so, why it was rejected.
---------------------------------------------------------------------------
One searches the majority's NPRM in vain for any reasoned
explanation for this sea change. The majority certainly points to
nothing that has changed in the representation case arena that would
justify jettisoning the policy. Congress has not amended the Act in
such a way that calls the blocking charge policy into question. No
court has invalidated the policy. And significantly, the Agency's
career regional directors--the nonpolitical officials who are charged
with administering the policy in the first instance, and whose opinions
were explicitly sought and received by the Board--have publicly
endorsed the policy.\60\
---------------------------------------------------------------------------
\60\ See April 13, 2018 Regional Director Committee's Response
and Comments to the Board's Request for Information on the
Representation-Case Procedures p.1 (reporting that directors ``do
not see a need to change'' blocking charge Section 103.20).
---------------------------------------------------------------------------
The majority's policy concerns about the blocking charge policy do
not provide persuasive reasons to abandon a longstanding doctrine that
protects core statutory interests.
First, the majority repeatedly emphasizes the obvious: That the
blocking charge policy causes delays in conducting elections. From
this, the majority argues that the blocking charge policy impedes
employee free choice. However, the majority's conclusion does not
necessarily follow from its premise. To the contrary, as one Board
after another has recognized for more than 8 decades, the blocking
charge policy protects employee free choice notwithstanding the delay
that the policy necessarily entails. Thus, ``it is immaterial that
elections may be delayed or prevented by blocking charges, because when
charges have merit, elections should be [delayed or] prevented.''
Levitz, 333 NLRB at 728 n.57. Indeed, as the Board noted when it
codified the decades old blocking charge policy, ``Unfair labor
practice charges that warrant blocking an election involve conduct that
is inconsistent with a free and fair election: It advances no policy of
the Act for the agency to conduct an election unless employees can vote
without unlawful interference.'' 79 FR 74429. Put simply, if the
circumstances surrounding an election interfere with employee free
choice, then, contrary to the majority, it most certainly is not
``efficient'' to permit employees to cast ballots ``speedily'' because
the ballots cast in such an election cannot be deemed to ``accurately''
reflect employees' true, undistorted desires. The majority plainly errs
in suggesting that elections conducted under coercive circumstances
actually resolve the question of representation.
Second, the majority complains that there is a potential for
incumbent unions to abuse the blocking charge policy by deliberately
filing nonmeritorious unfair labor practice charges in the hopes of
delaying the decertification elections that may result in their ouster.
But the majority makes no effort to determine how often decertification
petitions are blocked by meritorious charges, as compared to
nonmeritorious charges, or how much delay is attributable to
nonmeritorious charges (which still may well have been filed in good
faith, and not for purposes of obstruction).\61\
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\61\ Nor does the majority explain why it is proposing to
jettison the blocking charge policy in the context of initial
organizing campaigns to select union representation (involving
``RC'' petitions), based merely on alleged abuse in the context of
decertification campaigns to remove incumbent unions (involving
``RD'' petitions).
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Recent blocking charge data undercuts the majority's unsupported
concern.\62\ My preliminary review of the relevant data for Fiscal
Years 2016 and 2017 indicates that the overwhelming majority of
decertification petitions are never blocked.\63\ Approximately 80
[[Page 39944]]
percent of the decertification petitions filed in FY 2016 and FY 2017
were not impacted by the blocking charge policy because only about 20
percent (131 out of 641) of the decertification petitions filed in FY
2016 and FY 2017 were blocked as a result of the policy. See Dissent
Appendix. Even in the minority of instances when decertification
petitions are blocked, most of these petitions are blocked by
meritorious charges. Approximately 66% (86 out of 131) of the
decertification petitions that were blocked in FY 2016 and FY 2017 were
blocked by meritorious charges. See Dissent Appendix, Section 1.\64\
---------------------------------------------------------------------------
\62\ Compared to the countless examples of cases where employers
engage in coercive behavior--such as instigating decertification
petitions, committing unfair labor practices that inevitably cause
disaffection from incumbent unions, and engaging in unfair labor
practices after a decertification petition is filed--in an effort to
oust incumbent unions, or engage in coercive behavior to sway
employee votes in the context of initial organizing campaigns, see
Board Volumes 1-368, the majority cites only a few isolated cases
arising during the 80-plus year history of the blocking charge
policy to support its claim that unions abuse the policy. And the
cited cases hardly constitute persuasive authority for jettisoning
the blocking charge policy. Two of the cited cases--Templeton v.
Dixie Color Printing Co., Inc., 444 F.2d 1064 (5th Cir. 1971) and
NLRB v. Minute Maid Corp., 283 F.2d 705 (5th Cir. 1960)--arose in
the Fifth Circuit, which in fact has subsequently and repeatedly
approved of the blocking charge policy, recognizing that that the
policy has been ``legitimized by experience.'' See Bishop v. NLRB,
502 F.2d at 1028-1029 (and cases cited therein); Associated Builders
and Contractors of Texas, Inc. v. NLRB, 826 F.3d 215, 228 fn. 9 (5th
Cir. 2016). ``[T]ime and again'' the Fifth Circuit has taken pains
to note that cases such as Templeton do not constitute a broad
indictment of the blocking charge policy, but merely reflect the
``most unusual'' circumstances presented there. See Bishop v. NLRB,
502 F.2d at 1030-1031.
Similarly, in NLRB v. Midtown Service Co., Inc., the court
wholeheartedly endorsed the notion that the Act requires the Board
``to insure . . . employees a free and unfettered choice of
bargaining representatives.'' 425 F.2d 665, 672 (2d Cir. 1970).
While the court criticized the Board for declining to conduct a
rerun election before the employer's unfair labor practices were
remedied, that was only because of the highly unusual circumstances
presented there, where the employer's unlawful acts were actually
designed to support the incumbent union against the decertification
petition. See id. at 667, 669, 672 (``If ever there were special
circumstances warranting the holding of [a rerun] election, they
existed here'' because the union was the ``beneficiary of the
Employer's misconduct,'' and thus the union was using the charges to
achieve an indefinite stalemate ``designed to perpetuate [itself] in
power.''). Although the Court also opined, ibid, that a rerun
election should not have been blocked even if the charges had been
filed by the decertification petitioner, the blocking charge policy
as it exists today would not have blocked the election in such
circumstances, because, as shown, a petition is not blocked unless,
among other things, the charging party requests that its charge
block the petition.
Meanwhile, the Seventh Circuit's conclusion that the union
abused the blocking charge policy in Pacemaker Corp. v. NLRB, is
mystifying. 260 F.2d 880, 882 (7th Cir 1958). The court appeared to
blame the union first of all for seeking an adjournment of the
representation case hearing so that it could file an amended unfair
labor practice charge. But the facts as found by the court bely any
such conclusion; the discharge that was a subject of the amended
unfair labor practice charge in question occurred after the
adjournment, not before. Thus, the union could not have filed that
amended charge before the hearing. 260 F.2d at 882. Moreover, the
court ultimately agreed with the Board that the union's amended
charge--alleging that the employer had discharged a union
supporter--had merit. Id. at 882-883. The court also appeared to
blame the union for seeking to delay the representation proceeding
by filing a post-petition amended unfair labor practice charge,
because the union had chosen to file a petition despite its other
pre-petition unfair labor practice charges. But such criticism was
also unwarranted. Thus, the court ignored that, as the employer
itself argued to the administrative law judge, while the union would
not waive the amended unfair labor practice charge, the union was
not requesting a delay based on the post-petition amended unfair
labor practice allegations. See Pacemaker Corp., 120 NLRB 987, 995
(1958). In any event, by filing a petition despite pre-petition
misconduct, a union certainly cannot be deemed to have waived its
right to request that the petition be held in abeyance if the
employer commits additional unfair labor practices post-petition
that would interfere with employee free choice.
And NLRB v. Hart Beverage Co., was not even a blocking charge
case, but instead arose at a time in the distant past when an
employer had no right to decline a union's demand for recognition
(and no right to demand that the union seeking 9(a) status win an
election), unless the employer had a good faith doubt of the union's
majority status. 445 F.2d 415, 417-418 (8th Cir. 1971). It was in
that context that the union business agent made the statement that
the court relied on in concluding that the union was not even
interested in obtaining a free and fair election, and therefore had
filed the charges to abort the employer's petitioned-for election
and obtain a bargaining order. See id. at 417, 420.
\63\ See Dissent Appendix, available at https://www.nlrb.gov
(The Dissent Appendix includes my attempt to assemble and analyze a
reliable list of the FY 2016- and FY 2017-filed RD, RC, and
employer-filed RM petitions that were blocked pursuant to the
blocking charge policy, independent of the data relied upon by my
colleagues or provided to the public in the past. It also includes
charts from the agency's website showing the numbers of petitions
filed during those two fiscal years.).
\64\ In determining whether a petition was blocked by a
meritorious charge, I applied the Office of the General Counsel's
long-standing merit definition contained in OM 02-102 available at
https://www.nlrb.gov/news-publications/nlrb-memoranda/operations-management-memos. Accordingly, a petition was deemed blocked by a
meritorious charge if the petition was blocked by a charge that
resulted in a complaint, a pre-complaint Board settlement, a pre-
complaint adjusted withdrawal, or a pre-complaint adjusted
dismissal. Id. at p.4. I note in this regard that the new Chairman
and new General Counsel used the same merit definition in their
Strategic Plan for FY 2019-FY 2022. See, e.g., Strategic Plan p. 5
attached to GC Memorandum 19-02, available at https://www.nlrb.gov/news-publications/nlrb-memoranda/general-counsel-memos.
Notably, the merit rate for all unfair labor practice charges in
FYs 2016 and 2017 merely ranged from 37.1% to 38.6%. See NLRB
Performance and Accountability Report FY 2016 and 2017, available at
https://www.nlrb.gov/reports-guidance/reports/performance-and-accountability.
---------------------------------------------------------------------------
The majority also fails to show that its proposed vote-and-impound
procedure will be less likely to precipitate the (seemingly uncommon)
filing of frivolous charges. To be sure, under the majority's proposal,
a union cannot postpone an election by filing an unfair labor practice
charge. But a union can still delay its potential ouster under the
majority's proposed vote-and-impound procedure by filing a charge.
Under the majority's proposal, the regional director will not be able
to open and count the ballots cast in the impounded election until the
unfair labor practice case is decided and the charge(s) found to be
lacking in merit. Presumably, a union hellbent on postponing its ouster
will still have reason to file unfair labor practice charges to cause
the ballots cast in the decertification election to be impounded,
thereby delaying the tally of ballots and the certification of results
under the proposed vote-and-impound procedure.
Third, the majority finds fault with the blocking charge policy
because it permits a mere discretionary ``administrative
determination'' as to the merits of unfair labor practice charges to
delay employees' ability to vote whether they wish to obtain, or
retain, union representation. But the majority ignores that regional
directors and the General Counsel make all sorts of administrative
determinations that impact the ability of employees to obtain an
election. For example, employees, unions, and employers are denied an
election if the regional director makes an administrative determination
that the petitioner lacks an adequate showing of interest. See 79 FR
74391, 74421 (the adequacy of the showing of interest is a matter for
administrative determination and is non-litigable). Regional directors
may also deny employer and union requests for second elections based on
an administrative determination that no misconduct occurred or that any
misconduct that occurred did not interfere with employee free choice.
See 79 FR 74412, 74416 (parties have no entitlement to a post-election
hearing on election objections or determinative challenges, and
regional directors have discretion to dispose of such matters
administratively).\65\ Indeed, the majority's disrespect for regional
director administrative determinations in this context is in
considerable tension with Congress' authorizing (in Section 3(b))
regional directors to administratively decide when elections should be
conducted in the first place and when the results of elections should
be certified. See also 79 FR 74332-74334 (observing that Congress
expressed confidence in the regional directors' abilities when it
enacted Section 3(b)).\66\
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\65\ The courts have also rejected claims that administrative
settlements of Gissel complaints are insufficient to demonstrate
9(a) status. See, e.g., Allied Mechanical Services, Inc. v. NLRB,
668 F.3d 758, 761, 771, 773 (D.C. Cir. 2012) (``It is . . .
unlikely--and even illogical--to suppose that the Board's General
Counsel would have asserted that a majority of Allied's unit
employees had designated the Union as their representative through
authorization cards, and that a Gissel bargaining order was
necessary to remedy the Company's unfair labor practices, without
first investigating the Union's claim of majority status and
satisfying itself that a Gissel bargaining order was
appropriate.'').
\66\ And despite criticizing the blocking charge policy for
permitting a mere administrative determination to delay or deprive
employees of the ability to go to the polls to resolve their
representational status, the majority has left unchanged Board law
permitting an employer to withdraw recognition from an incumbent
union based merely on the General Counsel's administrative
determination that a majority of the unit no longer desire union
representation. And that administrative determination--unlike the
administrative determination to hold a petition in abeyance under
the blocking charge policy--is not even reviewable by the Board,
because the General Counsel has unreviewable discretion to decline
to issue a complaint challenging an employer's unilateral withdrawal
of recognition from an incumbent union. See NLRB v. United Food &
Commercial Workers Union, Local 23, AFL-CIO, 484 U.S 112, 118-119
(1987) (a charging party may appeal a regional director's dismissal
of an unfair labor practice charge to the General Counsel, but not
to the Board); Williams v. NLRB, 105 F.3d 787, 790-791 n.3 (2d Cir.
1996) (`` `General Counsel's prosecutorial decisions are not subject
to review by the Board,' '' and courts may not pass judgment on the
merits of a matter never put in issue or passed upon by the Board)
(citation omitted). Indeed, if any issue cries out for rulemaking
based on the majority's professed neutral preference for speedy
secret ballot elections to determine representational rights, it is
current law that permits employers to withdraw recognition--without
an election--from unions that previously won Board-conducted
elections.
---------------------------------------------------------------------------
Fourth, the majority laments that employees who support
decertification petitions are adversely affected by blocking charges
because delay robs the petition effort of momentum and thus threatens
employee free choice. While I wish the majority shared the same concern
about the potential impacts of delay on the momentum of a union
organizing drive,\67\ the majority's objection misapprehends the core
statutory concerns underlying the blocking charge policy. If a party
has committed unfair labor practices that interfere with employee free
choice, then elections in those contexts will not accurately reflect
the employees' unimpeded desires and therefore should not be conducted.
Indeed, the momentum that the majority seeks to preserve may be
entirely illegitimate, as in cases where the employer unlawfully
initiates the decertification petition, or the momentum may be infected
by unlawful conduct, as in cases where after a decertification petition
is filed, the employer promises to reward employees who vote against
continued representation, or threatens adverse consequences for
employees who continue to support the incumbent union.
---------------------------------------------------------------------------
\67\ See Volkswagen Group of America Chattanooga Operations,
LLC, 367 NLRB No.138, slip op. at 3-4, 6-7 (2019).
---------------------------------------------------------------------------
Finally, the majority claims that the blocking charge policy
creates ``an anomalous situation'' whereby conduct that (under Ideal
Electric, 134 NLRB 1275 (1961)) cannot be found to interfere with
employee free choice if alleged in election objections (because it
occurred pre-petition), nevertheless can be the basis for delaying or
denying an election. But the supposed anomaly is more apparent than
real. Contrary to the majority, Ideal Electric does not preclude the
Board from considering pre-petition misconduct as a basis for setting
aside an election. As the Board has explained, ``Ideal Electric
notwithstanding, the Board will consider prepetition conduct that is
sufficiently serious to have affected the results of the election.''
Harborside
[[Page 39945]]
Healthcare, Inc., 343 NLRB 906, 912 fn. 21 (2004). Accord Madison
Square Garden, CT. LLC, 350 NLRB 117, 122 (2017). Further, as the
Majority implicitly concedes, under its own proposed vote-and-impound
procedure, it is equally the case that ballots will ``never be
counted'' in some cases based on serious pre-petition misconduct,
namely Type II misconduct, such as where the employer instigates the
petition. Moreover, contrary to the majority's suggestion, under the
blocking charge policy, regional directors have discretion to reject
blocking requests and proceed straight to an election when they
conclude that, under the circumstances, employees will be able to
exercise free choice notwithstanding a pending unfair labor practice
charge (because, for example, the charge merely alleges minor and
isolated pre-petition unfair labor conduct).\68\
---------------------------------------------------------------------------
\68\ See Casehandling Manual Section 11731.2 Exception 2: Free
Choice Possible Notwithstanding Charge (``There may be situations
where, in the presence of a request to block (Secs. 11731.1(a)), the
regional director is of the opinion that the employees could under
the circumstances, exercise their free choice in an election and
that the R case should proceed notwithstanding the existence of a
concurrent Type I or Type II unfair labor practice case. In such
circumstances, the regional director should deny the request to
block.'').
---------------------------------------------------------------------------
3.
The majority proposes to replace the blocking charge policy with a
vote-and-impound procedure that will require regional directors to
process all petitions to elections, no matter how serious the pending
unfair labor practice charges and no matter how powerful the indicia of
their merit, unless there has been a ``final determination'' by the
Board itself that unfair labor practices have been committed. As my
colleagues implicitly concede, the proposed vote-and-impound procedure
will undoubtedly require regional directors to run--and employees,
unions, and employers to participate in--elections conducted under
coercive conditions. Because my colleagues pledge that the ballots cast
in impounded elections will ``never be counted,'' in cases where the
elections were conducted under coercive conditions, it cannot be denied
that under the majority's proposed vote-and-impound procedure, regional
directors will be required to run--and employees, unions, and employers
will be required to participate in--many elections that will not
resolve the question of representation.
The majority nevertheless summarily concludes that the costs of
conducting tainted elections in which the impounded ballots will never
be counted is ``more than offset by the benefit of preserving
employees' free choice'' in those cases where the blocking charges are
ultimately found to lack merit. But asserting this does not make it so.
That's not how reasoned decisionmaking works. The majority has
proceeded from faulty premises, failed to ask critical questions,
failed to analyze the relevant data, and failed to reasonably consider
the financial and statutory costs of conducting elections under
coercive conditions. See, e.g., Motor Vehicle Manufacturers Assn of the
United States, Inc. v. State Farm Mutual Automotive Insurance Co., 463
U.S. 29, 43 (1983) (agency acts arbitrarily if it fails to examine the
relevant data or failed to consider an important aspect of the
problem). Without significant additional effort (or a total revamping)
before the rule is finalized, the majority's proposal seems unlikely to
survive even minimal judicial scrutiny.
a.
As an initial matter, the majority operates from the fundamentally
flawed premise that switching to a vote-and-impound procedure is
necessary to preserve employee free choice because the blocking charge
policy deprives employees of free choice in those cases where petitions
are blocked by nonmeritorious charges. The majority ignores that the
blocking charge policy already preserves employee free choice in all
representation cases in which petitions are blocked because of
concurrent unfair labor practice charges. Because, as shown, the
blocking charge policy provides for the regional director to resume
processing the representation petition to an election if the charge is
ultimately determined to lack merit, the unit employees in those cases
will be afforded the opportunity to vote whether they wish to be
represented, and thus employee free choice is preserved. However,
unlike the majority's proposed vote-and-impound procedure, the blocking
charge policy protects employee free choice in cases involving
meritorious charges, by delaying elections until the unfair labor
practices are remedied, thus shielding employees from having to vote
under coercive conditions. In short, it is the 80-year old blocking
charge policy, not the majority's proposed vote-and-impound procedure,
that best protects employee free choice in the election process.\69\
---------------------------------------------------------------------------
\69\ The majority is also simply wrong in suggesting that the
blocking charge policy can prevent employees from ever obtaining an
election if they continue to desire an election after the merits of
the charge are determined. As shown, if the petition is held in
abeyance, the regional director resumes processing the petition once
the charge is ultimately found to lack merit or the unfair labor
practice conduct is remedied. Casehandling Manual Sections 11732,
11733.1, 11734. If, on the other hand, the petition is dismissed
because of a Type II charge, it is subject to reinstatement if the
charge is found nonmeritorious. Id. at Section 11733.2. And, as the
courts have recognized, even if the petition is dismissed because of
a meritorious Type II blocking charge, employees may, if they so
choose, file a new petition after the unfair labor practice conduct
that caused the petition to be dismissed is remedied. See Bishop v.
NLRB, 502 F.2d 1024, 1028-1029 (5th Cir. 1974) (``If the employees'
dissatisfaction with the certified union should continue even after
the union has had an opportunity to operate free from the employer's
unfair labor practices, the employees may at that later date submit
another decertification petition''); Albertson's Inc. v. NLRB, 161
F.3d 1231, 1239 (10th Cir. 1998) (``any harm to employees seeking
decertification resulting from the blocking of the petition is
slight in that employees are free to file a new petition so long as
it is circulated and signed in an environment free of unfair labor
practices.''). Even if the petitioner withdraws his or her petition,
another employee is free to file a new petition. To be sure, as the
majority notes, a blocked decertification petition may never proceed
to an election if the incumbent union disclaims interest in
representing the unit. However, there plainly is no need to hold a
decertification election to afford employees the opportunity to oust
the incumbent union if that union has voluntarily withdrawn from the
scene. Accordingly, it cannot fairly be concluded that employee free
choice is impeded in such cases either.
The majority also cries wolf in suggesting that the blocking
charge policy renders illusory the possibility of employer-filed
(``RM'') election petitions. Once again, if an RM petition is
blocked, the regional director resumes processing it once the unfair
labor practice charges are remedied or the charges are determined to
lack merit. Moreover, my preliminary analysis of the relevant data
indicates that the overwhelming majority of RM petitions are never
blocked, and that even in the minority of instances when RM
petitions are blocked, most of these petitions are blocked by
meritorious charges. Indeed, my review of the relevant data
indicates that approximately 82 percent of the RM petitions filed
during FY 2016 and FY 2017 were not blocked, leaving only about 18
percent (18 out of 99) of the RM petitions filed during FY 2016 and
FY 2017 as blocked under the policy. See Dissent Appendix, available
at https://www.nlrb.gov. And most pointedly, nearly 89 percent (16
out of 18) of the RM petitions blocked during FY 2016 and FY 2017
were blocked by meritorious charges. See Dissent Appendix, Sec. 1.
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The majority likewise relies on a series of faulty premises in
touting the other supposed advantages of its proposed vote-and-impound
procedure. Indeed, the other supposed benefits of the majority's
proposed vote-and-impound procedure are either illusory or greatly
overstated. The majority claims that a vote-and-impound procedure will
allow the balloting to occur when the parties' respective arguments are
``fresh in the mind[s] of unit employees.'' But this argument ignores
that under the long-established blocking charge policy, balloting also
occurs when the parties' respective arguments are ``fresh in the
minds'' of unit employees, because parties have an
[[Page 39946]]
opportunity to campaign after the director resumes processing a
petition (once either the unfair labor practice conduct has been
remedied or the director determines that the charge lacks merit). Put
simply, all the majority's proposed vote-and-impound procedure ensures
is that balloting will occur when the unremedied coercive conduct is
fresh in the minds of unit employees, which plainly undermines the
Act's policy of protecting employee free choice in the election process
and contravenes the Board's duty to conduct fair elections.\70\
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\70\ The majority also mistakenly argues that neither party will
be able to control the preelection narrative under its proposed
vote-and-impound procedure, whereas the blocking charge policy
enables the party filing the unfair labor practice charge to control
the narrative that the Board has blocked the petition because it has
found ``probable cause'' that a party has committed unfair labor
practices. The majority is wrong on both counts. Thus, under the
blocking charge policy, neither the Board nor the regional director
notifies unit employees that the petition is being held in abeyance
because there is ``probable cause'' to believe that a party has
committed unfair labor practices.
The Board, of course, has no contact at all with the unit
employees. And when before an election is scheduled, a regional
director decides to hold a case in abeyance because of blocking
charges, the regional director communicates his or her decision only
to the parties and does not even request that the employer post the
abeyance letter for unit employees to read. In any event, the
regional director's letter typically makes no reference to the
sufficiency of the evidence in support of the charge. See, e.g.,
October 27, 2016 abeyance letter in Graymont Western Lime, Inc. Case
18-RD-186636 (``This is to notify you that the petition in the
above-captioned case will be held in abeyance pending the
investigation of the unfair labor practice charges in Case 18-CA-
186811.'') Even when a regional director issues an order postponing
or cancelling a scheduled election because of a blocking charge, and
requests that the employer post the order so that employees will
know that the election will not be held as scheduled, the regional
director's order often merely states that the election is being
postponed or cancelled because of a pending unfair labor practice
charge, with no reference to the merits of the charge. See, e.g.,
February 10, 2017 order postponing election in Xanterra Parks &
Resorts, Inc, Case 08-RD-191774 (``This is to advise that the
election scheduled for Friday, February 17, 2017 is indefinitely
postponed pending the investigation of the unfair labor practice
charge in Case No. 08-CA-192771, filed by United Food and Commercial
Workers Union Local 880. Further processing of the petition is
hereby blocked. The Employer should immediately remove all election
notices and post a copy of this letter so that employees are advised
that no election will be held.'').
To be sure, under the blocking charge policy, a party is free to
exercise its First Amendment rights and tell unit employees that the
regional director has blocked action on the petition because a party
stands accused of committing unfair labor practices that would
interfere with employee free choice in an election. (And the charged
party is free to exercise its First Amendment rights and tell the
unit employees that it is innocent of any wrongdoing and that the
charging party is responsible for the delaying the employees'
opportunity to vote.)
But under the majority's proposed vote-and-impound procedure,
parties will similarly be free to exercise their First Amendment
rights and inform unit employees in advance of the election that the
regional director will impound the ballots cast in the election--
rather than immediately open and count the ballots following the
election--because a party stands accused of committing unfair labor
practices that would interfere with employee free choice. (And the
charged party will be free to exercise its First Amendment rights
and inform unit employees that it is innocent of any wrongdoing and
that the charging party is responsible for the delay in opening and
counting the ballots). Unless the majority plans on muzzling
parties' free speech rights, parties will continue to be as free to
present their own narratives to the unit employees under the
Majority's proposed vote-and-impound procedure as they are under the
blocking charge policy.
---------------------------------------------------------------------------
The majority also mistakenly argues that its proposed vote-and-
impound procedure will reduce significant delays in representation
cases resulting from the blocking charge policy by enabling the count
and resulting tally of ballots to occur ``almost immediately,'' in
those cases in which the unfair labor practice charges lack merit. The
majority insists that this is so because elections will not have to be
scheduled in those cases where the charges lacks merit (because the
elections will have already been run).
However, the majority greatly overestimates the time savings. By
definition, the majority's proposed vote-and-impound procedure will not
result in any time savings whatsoever in those cases where the charges
have merit, because, as the majority admits, the ballots cast in those
cases will ``never be counted.'' In other words, in cases where the
blocking charges are ultimately determined to be meritorious, elections
will have to be (re)scheduled because the impounded elections will have
to be rerun. And, as will be shown below, my preliminary analysis of
the relevant data indicates that those are the majority of cases, for a
majority of the petitions that are blocked are blocked by meritorious
unfair labor practice charges. Moreover, the majority greatly
overstates the time savings in the subset of cases where petitions are
blocked by charges that are ultimately found to be nonmeritorious. Put
simply, under the majority's proposed vote-and-impound procedure, the
regional director will not be able to open and count the impounded
ballots, and therefore will not be able to certify the results of the
election, until after the unfair labor practice case is decided. And it
takes the same amount of time to investigate and decide an unfair labor
practice charge whether the charge is investigated before the election
or the charge is investigated after the election. Thus, the majority
ignores the reality that under its proposed vote-and-impound procedure,
the outcome of the representation case will still have to await the
outcome of the unfair labor practice case, precisely the same result
that obtains under the long-established blocking charge policy. While
the majority cites a study of blocking charges causing a 100-day delay
in holding elections,\71\ virtually all that
[[Page 39947]]
time is due to the time it takes to resolve the unfair labor practice
issues, which, as shown, will still have to be resolved before the
ballots can be counted and the results certified under the majority's
vote-and-impound procedure.\72\
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\71\ See Samuel Estreicher, Improving the Administration of the
National Labor Relations Act Without Statutory Change, 5 FIU L.Rev.
361, 369-370 (2010). The Majority contends that ``not much'' has
changed during FY 2016 through FY 2018 in the sense that a similar
delay continues to exist: ``The median number of days from petition
to election from 2016 through 2018 was 23 days in unblocked cases.
The median number of days from petition to election in the same
period for blocked cases ranged from 122 to 145 days.''
While the majority contends that the median number of days from
petition to election in blocked cases is no more than 145 days for
FY 2016 through 2018, it also states that on December 31, 2018,
there were 118 blocked petitions that had been pending an average of
893 days, with the oldest cases having been pending for 4,491 days,
i.e. more than 12 years. See Majority Appendices A and B, available
at https://www.nlrb.gov. Although I would agree with my colleagues
that such delay is regrettable, there are reasons to doubt the
reliability of their limited data. To begin, the list of pending
cases on December 31, 2018, and associated days blocked assembled by
my colleagues appears to inappropriately aggregate multiple blocking
periods for the same case, even when those periods run concurrently.
This has the rather bizarre effect of listing a case such as
Piedmont Gardens, Grand Lake Gardens, 32-RC-087995, as having been
blocked for more than 12 years--an impossibly high estimate
considering that the case was less than 7 years old as of December
31, 2018 (with a petition-filing date of August 24, 2012). See
Majority Appendix B Tab 4. My colleagues not only err by
artificially inflating the length of time periods that their cited
cases were blocked, they also err by artificially inflating the
number of ``blocked petitions pending'' by including in their list
cases such as VT Hackney, Inc., 06-RC-198567, and National Hot Rod
Association (NHRA), 22-RC-186622, neither of which were blocked due
to the blocking charge policy.
But even if I were to assume the accuracy of the majority's
figures, those 118 cases would represent less than half of one
percent (0.37%) of the 31,410 total RC, RD, and RM petitions filed
during the 12-year period they cite. See Dissent Appendix, Sec. 4,
available at https://www.nlrb.gov. Indeed, the blocking charge
policy causes no delays whatsoever in the overwhelming majority of
cases because the overwhelming majority of petitions are never
blocked. For example, less than 5 percent (217 out of 4,623) of the
RC, RD, and RM petitions filed during Fiscal Years 2016 and 2017
were blocked as a result of the blocking charge policy. See id.
Moreover, it stands to reason that the oldest cases are the fully
litigated cases resulting in Board remedial orders that go all the
way to the Circuit Courts, rather than the cases involving
nonmeritorious charges that can be weeded out at the regional level.
Indeed, the oldest cases referenced by the majority--Pine Brook Care
Center, 22-RC-012742, and Pavillion at Forrestal, 22-RC-012743 (see
Majority Appendix B Tab 4)--each involved employers found by the
Board and the D.C. Circuit to have bargained in bad faith and made
unlawful unilateral changes in lieu of bargaining with their
incumbent unions (with one employer's intransigence prompting the
initiation of contempt proceedings that further delayed the
representation case). Given the employers' unlawful acts and
litigiousness in the face of Board and Court Orders, it would appear
that even if the majority's proposed vote-and-impound procedure been
in effect during the last 12 years, the ballots in those cases would
have never been counted.
\72\ It is notable that the majority has seemingly failed to
consider other actions outside the context of this rulemaking that
might address unnecessary delays in the processing of blocking
charges. For example, the current General Counsel has terminated the
practice of requiring regional directors to adhere to the Impact
Analysis system for prioritizing the processing of unfair labor
practice charges (See GC Memorandum 19-02 p. 3), which had placed
blocking charges in Category III, the category of charges to be
afforded highest priority, because those charges involve allegations
``most central to achievement of the Agency's mission.'' See
Casehandling Manual Sections 11740, 11740.1. If anything, I would
think that in its role of supervising delegated authority under
Section 3(b), the Board Majority would want to look into this change
and take steps to ensure that blocking charges are afforded the
highest priority in terms of case processing.
The majority's failure to consider such an obvious alternative
to address delay evidences the arbitrary nature of the Majority's
approach. The majority also should have analyzed the impact the
mandatory-offer-of-proof and prompt-furnishing-of-witness
requirements have had on the time it takes for regional directors to
determine that a blocking charge lacks merit and the impact those
requirements have had on the merit rates of blocking charges. See
Associated Builders and Contractors of Texas, Inc. v. NLRB, 826 F.3d
215, 228 (5th Cir. 2016) (citing amended Section 103.20's offer of
proof requirement, and concluding that the Board ``considered the
delays caused by blocking charges, and modified current policy in
accordance with those considerations.''). Yet it appears that the
majority has short circuited the process by prematurely deciding
that more robust measures are necessary to deal with the problem of
delay caused by nonmeritorious blocking charges.
---------------------------------------------------------------------------
b.
Just as the majority fails to engage in a reasoned analysis of the
supposed benefits of its proposed vote-and-impound procedure, so too
does the majority fail to engage in a reasoned analysis of the costs of
its proposed vote-and-impound procedure. As a result, it has failed to
justify its current conclusion that the cost of conducting coercive
elections in which the impounded ballots will never be counted is more
than offset by the benefit of letting employees vote sooner in those
cases where the blocking charges are subsequently determined to lack
merit.
The majority's first mistake here is that it fails to ask a
critical question--namely, what percentage of blocked petitions are
blocked by meritorious charges. After all, if every blocked petition
were blocked by a meritorious charge, my colleagues would have to
concede that there would be no reason to change the policy. There would
no point in holding elections and impounding ballots if the Board knew
in advance that those ballots would never be opened because parties had
committed unfair labor practices interfering with employee free choice
or that were inherently inconsistent with the petition itself. To be
sure, there is no way to be certain whether a particular charge is
meritorious when it is filed, though, as the majority implicitly
concedes, the Board's simultaneous offer-of-proof requirement does
provide a tool for regional directors to weed out plainly
nonmeritorious blocking charges. But it would be reasonable to expect
that before proposing to jettison the blocking charge policy in favor
of a vote-and-impound procedure, rational Board Members would analyze
the relevant data to determine the percentage of petitions that are
blocked by meritorious charges. Yet, the majority inexplicably fails to
analyze the data.
If the majority wanted to proceed in a rational manner, it could
have determined the percentage of petitions blocked by meritorious
charges. The data necessary to reach that determination is available
using the Agency's electronic case tracking system (``NxGen''), into
which regional employees enter notations as a case is processed and
upload relevant documents. For example, NxGen entries reflect not only
when a petition is filed or when an election is held, but also if a
party requests that its charge block an election, and if the petition
is dismissed, withdrawn, or blocked for any reason.\73\ Similarly,
NxGen entries reflect when an unfair labor practice charge is filed,
and whether the charge is settled, results in a complaint, or is
withdrawn or dismissed. NxGen also contains codes reflecting the
representation and unfair labor practice case closing reasons and links
to relevant documents. The majority plainly could have run queries to
determine which petitions were filed during a given fiscal year,
whether any of those petitions were blocked, and if so, which unfair
labor practice charges blocked them. And then the majority could have
verified whether those petitions were blocked by meritorious charges by
examining the underlying NxGen case files.
---------------------------------------------------------------------------
\73\ A petition may be deemed blocked in NxGen for a variety of
reasons having nothing to do with the blocking charge policy.
---------------------------------------------------------------------------
Instead, all the majority purports to have done is tally the number
of petitions blocked during FY 2016 through FY 2018 that eventually
went to an election, and compare the longer median number of days from
petition to election in blocked versus unblocked cases. But that only
proves the obvious--that the blocking charge policy results in some
petitions being blocked with attendant election delays. The majority's
paltry statistics tell us nothing about whether the petitions at issue
deserved to be blocked, nor do they indicate whether, if the majority's
proposed vote-and-impound procedure had been in place, the ballots cast
in those cases would ever have been counted.
Moreover, by purporting to tally only petitions that proceeded to
election during those fiscal years, the majority plainly undercounted
the number of petitions blocked by the blocking charge policy. See
Majority Appendices A and B.\74\ Thus, the majority failed to consider
blocked petitions that never proceeded to an election. Examining such
petitions is an obviously relevant line of inquiry. For if a
decertification petition that is blocked never proceeds to an
election--either because the director dismisses the petition due to
[[Page 39948]]
meritorious Type II blocking charges or because the petitioner decides
to withdraw the petition after the unfair labor practice conduct has
been remedied--that strikes me as a statutory success, not a failure.
After all, the Board should not conduct elections if the employer
unlawfully instigated the petition or if the petitioner has a change of
heart after the unfair labor practice conduct has been remedied and no
longer wishes to proceed to an election.\75\ By failing to ask critical
questions and to analyze the relevant data, the Majority has acted
arbitrarily and capriciously. See Motor Vehicle Manufacturers
Association of the United States, Inc. v. State Farm Mutual Automotive
Insurance Co., 463 U.S. 29, 43 (1983) (agency acts arbitrarily if it
fails to examine the relevant data or failed to consider an important
aspect of the problem).
---------------------------------------------------------------------------
\74\ Ironically, the limited data relied upon by the majority
simultaneously overcounts by some two dozen the number of petitions
in FYs 2016 and 2017 allegedly blocked by the blocking charge
policy. For example, the majority incorrectly counts petitions for
which there were no associated charges. See, e.g., the nine separate
petitions associated with Yale University, 1-RC-183014 et al. The
majority also mistakenly counts petitions that were held up because
of internal union constitutional provisions governing raiding
situations. See, e.g., Carullo Construction, 29-RC-196404; NBC
Sports Network, 18-RC-196593. See also NLRB Casehandling Manual
Sections 11017, 11018.1, 11019 (noting that Board procedures
accommodate established programs for handling representational
disputes (raiding) between and among affiliates of the AFL-CIO). In
other instances, the majority errs by counting certain petitions as
being blocked by the blocking charge policy when the petitioner
affirmatively indicated that it wished to proceed to the election
(see, e.g., VT Hackney, 06-RC-198567) or where the regional director
rejected a request to delay the election and the charging party then
withdrew its request to block (see, e.g., Dignity Health, 32-RC-
179906). Further, the majority's faulty tally of allegedly blocked
petitions incorrectly includes petitions that proceeded to an
immediate election but later became the subject of overlapping
objections/determinative challenges and unfair labor practice
charges, and for which the charging party did not make a request to
block the petition. See, e.g., Fred Emich, 27-RC-195781; Awesome
Transportation, 29-RC-175858. See 29 C.F.R Sec. 103.20; GC
Memorandum 15-06 p.35 (``[U]nder the final rule, the regional office
will no longer block a representation case unless the party filing
the unfair labor practice charge requests that the petition be
blocked. . . .''). Indeed, it makes no sense to fault the blocking
charge policy for the delay in resolving such post-election matters
given that regional directors would also have been unable to
immediately certify those election results until the objections or
determinative challenges were resolved even if the Board had never
adopted the blocking charge policy 80 years ago. (While similar
flaws are likely present in the majority's FY 2018 cases as well, I
did not have sufficient time prior to the publication of this NPRM
to review the relevant data for FY 2018.)
\75\ And, as shown, there also is no need to conduct a
decertification election if the incumbent union disclaims interest
in representing the unit.
---------------------------------------------------------------------------
The majority's failure to consider the relevant data leads it to
underestimate the unnecessary financial costs its proposal will impose
on the parties and the Board. Assuming that the number of
representation cases resulting in ballot impoundment under the proposed
vote-and-impound procedure is comparable to the number of
representation cases that were blocked during FY 2016 and FY 2017, and
assuming that the merit factor for the concurrent unfair labor practice
charges filed under the Majority's vote-and-impound procedure remains
comparable to the merit factor for blocking charges filed in FY 2016
and FY 2017, then my preliminary analysis of the relevant data
indicates that, under the majority's proposal, the ballots will never
be counted in approximately 67 percent of the RD, RM, and RC elections
in which ballots are impounded, because the elections will have been
conducted under coercive conditions.\76\ In other words, under the
majority's proposal, regional directors will be forced to conduct, and
the parties forced to participate in, dozens of unnecessary elections
that will not resolve the question of representation. It therefore
cannot be denied that the majority's proposed vote-and-impound
procedure will impose unnecessary financial costs on the parties and
the Board. Yet, my colleagues do not even acknowledge these costs in
any serious way, let alone attempt to quantify them in either the
NPRM's substantive preamble or its Initial Regulatory Flexibility
Analysis.
---------------------------------------------------------------------------
\76\ Thus, my analysis indicates that out of the 217 RC, RD, and
RM petitions that were blocked in Fiscal Years 2016 and 2017, 146
(or 2 out of every 3) of them, were blocked by meritorious charges.
See Dissent Appendix, Sec. 1.
---------------------------------------------------------------------------
Worse still, the majority likewise gives no serious consideration
to the damage its proposed vote-and-impound procedure will inflict on
employee rights and the policies of the Act. By requiring the Board to
conduct elections under coercive circumstances, the majority's proposal
plainly contravenes the Board's heavy responsibility to conduct free
and fair elections and undermines the Act's policy of protecting
employee free choice in the election process. Indeed, by forcing
employees to go to elections that will not count, the majority's vote-
and-impound proposal additionally threatens to create a sense among the
employees that attempting to exercise their Section 7 rights is futile.
Moreover, by requiring the Board to conduct elections that will have to
be rerun, the majority's proposed vote-and-impound procedure inevitably
disrupts industrial peace.
The relevant data also demonstrates that in most cases, the
proposed vote-and-impound procedure will not put the parties in the
position that most closely approximates the position they would have
been in had no party committed unfair labor practices interfering with
employee free choice. Had no party committed unfair labor practices,
employees would not be forced to vote in an atmosphere of coercion. But
employees inevitably will be forced to vote in an atmosphere of
coercion under the proposed vote-and-impound procedure because the
majority's proposal requires regional directors to conduct elections in
all cases where there are concurrent unfair labor practice charges,
save those where the Board itself has already issued a decision and
remedial order. Although under the majority's vote-and-impound
procedure, ballots will never be tallied in cases where the concurrent
unfair labor practice charges are ultimately found to be meritorious,
each employee will still know how he or she voted in the impounded
election. Accordingly, when a new election is conducted after the
unfair labor practice is remedied, the union will have to convince each
employee who voted against it under coercive conditions to switch his
or her vote, something the union normally would not have had to do
under the blocking charge policy because the regional director would
not have held an election until the unfair labor practice was remedied.
And, as the Board previously concluded (79 FR 74418-74419), there is a
substantial risk that the tainted election will compound the effects of
the unfair labor practices, because employees who voted against union
representation under the influence of the employer's coercion are
unlikely to change their votes in the rerun election. See NLRB v.
Savair Mfg. Co., 414 U.S. 270, 277-78 (1973.) Thus, it is the blocking
charge policy--rather than the majority's vote-and-impound proposal--
that puts the parties and employees in a position that more closely
approximates what would have happened had no party committed unfair
labor practices and best protects employee free choice.
The majority's proposed vote-and-impound procedure also creates
perverse incentives for employers to commit unfair labor practices. The
Board's vast experience conducting elections and deciding unfair labor
practice and objections cases confirms that it remains part of the
playbook for some employers to commit unfair labor practices to
interfere with their employees' ability to freely choose whether they
wish to be represented. By requiring the Board to conduct elections in
all cases where Type I or Type II unfair labor practice charges are
filed even over the objections of the charging party union, the
majority's proposal creates a perverse incentive for unscrupulous
employers to commit unfair labor practices because the predictable
results will be: (1) To force unions to expend resources in connection
with elections that will not count; and (2) to create a sense among
employees that seeking to exercise their Section 7 rights is
futile.\77\ And under the majority's proposal, unscrupulous employers
can add insult to injury by telling their employees that the union is
to blame for preventing the regional office from counting the ballots
the employees took the time and trouble to cast. This possibility may
well induce unions to forego the Board's electoral machinery in favor
of recognitional picketing and other forms of economic pressure,
thereby exacerbating industrial strife.
---------------------------------------------------------------------------
\77\ Indeed, it seems impossible to square the majority's
proposal--of requiring elections in all cases no matter the severity
of the employer's unfair labor practices--with the Supreme Court's
approval in Gissel of the Board's practice of withholding an
election and issuing a bargaining order when the employer has
committed serious unfair labor practice conduct disruptive of the
election machinery and where the Board concludes that ``the
possibility of erasing the effects of [the employer's] past [unfair
labor] practices and of ensuring a fair election . . . by the use of
traditional remedies, though present, is slight and that employee
sentiment once expressed through [union authorization] cards would,
on balance, be better protected by a bargaining order . . . .''
Gissel, 395 U.S. at 591-592, 610-611, 614.
---------------------------------------------------------------------------
The proposed regulatory text implementing the majority's proposed
[[Page 39949]]
vote-and-impound procedure further impairs employee free choice and
contravenes the Board's responsibility to conduct free and fair
elections. Thus, the majority's proposed regulatory text set forth in
the final sentence of proposed section 103.20 indicates both that an
election will be conducted and that the ballots will not be impounded
if a case settles prior to the conclusion of the election. Incredibly,
this means that an election will be held and the ballots will be
counted if the parties sign a settlement agreement before the
conclusion of the election, even if the employer has not fully remedied
the unfair labor practice conduct as provided for in the agreement.
Previously, the Board--including members of today's majority--would not
have considered the ballots cast in such an election to reflect
employees' unimpeded desires, given that ballots were cast before the
alleged unfair labor conduct was fully remedied. See Cablevision
Systems Corp., 367 NLRB No. 59, slip op. at 1, 3 (2018) (citing with
approval Truserv Corp., 349 NLRB 227, 227 (2007) (``we hold that . . .
the decertification petition can be processed and an election can be
held after the completion of the remedial period associated with the
settlement of the unfair labor practice charge.'')) (emphasis
added).\78\
---------------------------------------------------------------------------
\78\ For all these reasons, the majority's contention--that its
proposed vote-and-impound procedure meets ``[t]he concern for
protection of [employee free] choice from coercion by unfair labor
practices''--is simply untenable.
---------------------------------------------------------------------------
At the same time, the majority's proposed vote-and-impound
procedure likewise will dramatically increase the number of employers
who face uncertainty about whether they may unilaterally change their
employees' working conditions. Under Mike O'Connor Chevrolet, an
employer acts at its peril in making changes in terms and conditions of
employment during the period between an election and the certification
of the results. 209 NLRB 701, 703 (1974), enf. denied on other grounds,
512 F.2d 684 (8th Cir. 1975). Thus, if the union is ultimately
certified as the employees' representative following the election, the
employer will have to rescind any unilateral changes it made during
that period and make employees whole for losses resulting from any such
changes.
By definition, the majority's proposed vote-and-impound procedure
will increase the number of cases where employers face that
uncertainty. Under the majority's proposal, if the regional director or
the Board ultimately determines in a given case that the impounded
ballots should be opened and counted--because the unfair labor practice
charge was ultimately determined to be lacking in merit--and the union
turns out to win the election, then the employer will need to rescind,
and make employees whole for any losses resulting from, any unilateral
changes it made between the date of the election and the certification.
And, as shown, that certification will have to await the outcome of the
unfair labor practice case. The majority certainly offers no
explanation for subjecting employers to that risk of uncertainty in
cases where labor organizations would have preferred that no election
be held.
4.
Two years ago, in considering the proposed Request for Information
that purportedly forms part of the impetus for this rulemaking, I
explained in my dissent the majority's faulty process in approaching
possible changes to its existing rules. Unfortunately, these same
criticisms are equally applicable to the majority's faulty approach in
issuing today's blocking charge NPRM:
The Supreme Court has made clear that, when an agency is
considering modifying or rescinding a valid existing rule, it must
treat the governing rule as the status quo and must provide ``good
reasons'' to justify a departure from it. See Federal Communications
Commission v. Fox Television, 556 U.S. 502, 515 (2009). Obviously,
determining whether there are ``good reasons'' for departing from an
existing policy requires an agency to have a reasonable
understanding of the policy and how it is functioning. Only with
such an understanding can the agency recognize whether there is a
good basis for taking a new approach and explain why. Id. at 515-
516. Indeed, even when an agency is only beginning to explore
possible revisions to an existing rule, the principles of reasoned
decision-making demand a deliberative approach, informed by the
agency's own experience administering the existing rule. * * * [T]he
majority's reticence to focus this inquiry on the agency's own
data--the most straightforward source of information about how the
Rule is working--is puzzling. The majority's failure to take this
basic step suggests that they would rather not let objective facts
get in the way of an effort to find some basis to justify reopening
the Rule.
82 FR 58789.
Indeed, now more than a year-and-a-half later, the Board is issuing
an NPRM proposing to jettison the decades old blocking charge policy
that was codified in that rule, and it still has not analyzed the
relevant data.
Moreover, the majority offers no reasoned explanation for
jettisoning the blocking charge policy that plainly advances the Act's
policy of protecting employee free choice in elections, and has been
adhered to consistently for 80 years. Worse still, the majority's
proposed vote-and-impound procedure inevitably will undermine employee
rights and the policies of the Act, while imposing unnecessary costs on
the parties and the Board, by requiring regional directors to run, and
employees, unions, and employers to participate in, elections conducted
under coercive conditions that interfere with the ability of employees
to freely cast their ballots for or against representation.
B. The Voluntary Recognition Bar
The majority today also continues its effort to upend extant Board
precedent \79\--here in the form of a proposed rule targeting the
Board's voluntary recognition bar doctrine. Consistent with nearly 50
years of caselaw, the Board currently bars an election petition for a
reasonable period of time after the voluntary recognition of a
representative designated by a majority of employees. Lamons Gasket
Company, 357 NLRB 739 (2011). Now the majority signals its intent to
revive the Dana framework, which would establish a 45-day ``window
period'' after voluntary recognition during which employees may file a
decertification petition supported by a 30-percent showing of
interest.\80\ The majority would also require that, in order to start
the 45-day window period after voluntary recognition, employers must
post an official Board notice informing employees of their right to
seek an election within the 45-day period to oust the lawfully-
recognized union.\81\ As I will explain, there is simply no good reason
for the majority to revisit this issue, much less to resurrect an
approach that, in the Board's own assessment, was ``flawed,
[[Page 39950]]
factually, legally, and as a matter of policy.'' \82\
---------------------------------------------------------------------------
\79\ See Johnson Controls, 368 NLRB No. 20 (2019) (Member
McFerran, dissenting); UPMC, 368 NLRB No. 2, slip op. at 15 & fn. 56
(2019) (Member McFerran, dissenting); SuperShuttle DFW, Inc., 367
NLRB No. 75, slip op. at 15 & fn. 2 (2019) (Member McFerran,
dissenting); Alstate Maintenance, LLC, 367 NLRB No. 68, slip op. at
12 & fn. 18 (2019) (Member McFerran, dissenting); E.I. Du Pont de
Nemours, Louisville Works, 367 NLRB No. 12, slip op. at 3-4 (2018)
(Member McFerran, dissenting); Boeing Co., 366 NLRB No. 128, slip
op. at 9-10 (2018) (Members Pearce and McFerran, dissenting);
Raytheon Network Centric Systems, 365 NLRB No. 161, slip op. at 22
(2017) (Members Pearce and McFerran, dissenting); PCC Structurals,
Inc., supra, slip op. at 14, 16 (Members Pearce and McFerran,
dissenting); Hy-Brand Industrial Contractors, Ltd. and Brandt
Construction Co., 365 NLRB No. 156, slip op. at 36, 38 (2017)
(Members Pearce and McFerran, dissenting), vacated 366 NLRB No. 26
(2018); Boeing Co., 365 NLRB No. 154, slip op. at 30-31 (2017)
(Member McFerran, dissenting); UPMC, 365 NLRB No. 153, slip op. at
17-19 (2017) (Member McFerran, dissenting).
\80\ See Dana Corp., 351 NLRB 434, 441 (2007).
\81\ Id.
\82\ Lamons, 357 NLRB at 739.
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1.
As the Board has previously established, federal labor law ``not
only permits, but expressly recognizes two paths employees may travel
to obtain representation for the purpose of collective bargaining with
their employer''--a Board election or voluntary recognition.\83\ As the
Supreme Court has held, a ``Board election is not the only method by
which an employer may satisfy itself as to the union's majority
status.'' United Mine Workers v. Arkansas Oak Flooring Co., 351 U.S.
62, 72 fn. 8 (1956). And as the Board recognized in Dana, ``Voluntary
recognition itself predates the National Labor Relations Act and is
undisputedly lawful under it.'' 351 NLRB at 436.
---------------------------------------------------------------------------
\83\ Id. at 740.
---------------------------------------------------------------------------
Indeed, Congress was well aware of the practice of voluntary
recognition when it adopted the Act in 1935.\84\ In Section
9(c)(1)(A)(i) of the Act, Congress provided that employees could file a
petition for an election, alleging that a substantial number of
employees wish to be represented and ``that their employer declines to
recognize their representative.'' This language makes clear that
Congress recognized the practice of voluntary recognition and strongly
suggests that Congress believed Board supervised elections were
necessary only where an employer had declined to recognize its
employees chosen representative.\85\ In addition, Section 8(a)(5) of
the Act requires that an employer bargain collectively ``with the
chosen representatives of his employees,'' but does not specify that
such representatives must be chosen in a Board-supervised election.\86\
Accordingly, voluntary recognition ``has been woven into the very
fabric of the Act since its inception and has . . . been understood to
be a legitimate means of giving effect to the uncoerced choice of a
majority of employees.'' \87\
---------------------------------------------------------------------------
\84\ 357 NLRB at 741 fn. 7 (citing legislative history
acknowledging the practice of voluntary recognition).
\85\ Id. at 741.
\86\ Id.
\87\ 357 NLRB at 742.
---------------------------------------------------------------------------
To give substance to this policy, the Board held that, when an
employer voluntarily recognizes a union in good faith based on a
demonstrated showing of majority support, the parties are permitted a
reasonable time to bargain without challenge to the union's majority
status. Keller Plastics, 157 NLRB 583, 586 (1966). This doctrine--known
as the recognition bar--remained the Board's approach for decades. But
in Dana Corp., 351 NLRB 434 (2007), the Board introduced a 45-day
``window period'' after voluntary recognition during which employees
could file a decertification petition supported by a 30-percent showing
of interest. This is the approach that the majority seeks to
reinstitute in today's proposal.
2.
In Lamons, which overruled Dana, the Board--with the benefit of
briefing from the litigants and various amici curiae \88\--produced a
carefully-considered decision that explicated the statutory and
doctrinal bases for voluntary recognition and the recognition bar, and
evaluated the empirical evidence from the 4 years during which Dana was
in effect.
---------------------------------------------------------------------------
\88\ In soliciting amicus briefs, the Lamons Board unscored the
importance of ``review[ing] the briefs and consider[ing] the actual
experience of employees, unions, and employers under Dana Corp.,
before arriving at any conclusions.'' 355 NLRB 763, 763 (2010). In
reaching its final decision, the Board reviewed and considered
briefs from various significant stakeholders, including employer
advocacy groups and unions. 357 NLRB at 740 fn. 1.
---------------------------------------------------------------------------
To begin, the Lamons Board traced the roots of voluntary
recognition to the era predating the Act, and explained, via a detailed
survey of the legislative debates that informed both the initial
passage of the Act in 1935 and the enactment of the Taft-Hartley
amendments in 1947, how that practice was codified in the text of the
statute.\89\ Drawing from this history, the Board concluded that Dana
improperly characterized voluntary recognition as a ``suspect and
underground process.'' \90\
---------------------------------------------------------------------------
\89\ 357 NLRB at 740-742.
\90\ Id.
---------------------------------------------------------------------------
Having revisited the statutory basis for voluntary recognition, the
Board next assessed whether the Dana majority's guiding assertion--that
``there is good reason to question whether card signings . . .
accurately reflect employees' true choice concerning union
representation'' \91\--was borne out by the actual experience under
Dana. Significantly, the Board found that--based on its review of the
1,333 instances where Dana notices were requested--employees had
decertified the voluntarily-recognized union in only 1.2 percent of
those cases.\92\ Accordingly, the Board reasoned that ``contrary to the
Dana majority's assumption, the proof of majority support that underlay
the voluntary recognition during the past 4 years was a highly reliable
measure of employee sentiment.'' \93\ As such, the ``data
demonstrate[d] that the empirical assumption underlying [Dana] was
erroneous.'' \94\
---------------------------------------------------------------------------
\91\ 351 NLRB at 439.
\92\ 357 NLRB at 742.
\93\ Id.
\94\ Id. at 743.
---------------------------------------------------------------------------
Finally, the Lamons decision explained--with reference to decades
of affirmative Board and court precedent--how the traditional voluntary
recognition bar, like the analogous bars in other contexts, serves the
Board's statutory interest in ensuring that ``a newly created
bargaining relationship . . . be given a chance to succeed before being
subject to challenge.'' \95\ The Dana procedures, in contrast, imposed
obstacles to bargaining. Specifically, the Board observed that by
creating uncertainty over the union's status and delaying the start of
serious negotiations, the Dana decision undermined the parties' nascent
relationships and rendered successful collective bargaining less
likely.\96\ For all of these reasons, the Lamons Board overruled Dana
and returned to the previously-settled rule that an employer's
voluntary recognition of a union bars an election petition for a
reasonable period of time.\97\
---------------------------------------------------------------------------
\95\ Id. at 744.
\96\ Id. at 747.
\97\ Id. at 748. The Lamons Board for the first time defined a
reasonable period of time in this context to be no less than 6
months after the parties' first bargaining session and no more than
1 year. Id.
---------------------------------------------------------------------------
3.
Since 2011, the Board's comprehensive, evidence-based decision in
Lamons has facilitated a stable and predictable post-recognition course
for parties. Nonetheless, the majority today proposes to overrule that
approach--and to resurrect the discredited Dana framework--without any
suggestion as to why Lamons suddenly requires reassessment. The
majority presents no new policy justifications, legal grounds, or
evidentiary support on the side of its position. There have been no
intervening adverse judicial decisions, nor is there any reason to
doubt the legal soundness of Lamons, which reinstated the Board's
longstanding, court-approved doctrine. The best the majority can
muster, it seems, is to state that ``the justifications expressed in
the Dana Board majority and Lamons Gasket dissenting opinions . . . are
more persuasive than those expressed by the Lamons Gasket Board
majority.'' In other words, the majority resolves to overrule precedent
simply because it can. But as the Board has previously acknowledged, a
change in the
[[Page 39951]]
composition of the Board is not a reason for revisiting precedent.\98\
---------------------------------------------------------------------------
\98\ See Brown & Root Power & Mfg., Inc., 2014 WL 4302554 (Aug.
29, 2014); UFCW, Local No. 1996 (Visiting Nurse Health System,
Inc.), 338 NLRB 1074 (2003) (full Board) (citing cases).
---------------------------------------------------------------------------
In another pending NPRM--one that also targets a doctrine with deep
roots in Board and judicial precedent--this same majority espoused its
purported preference for ``predictability and consistency . . . .
thereby promoting labor-management stability.'' \99\ But today's
notice--with its disregard for precedent and its destabilizing effect
on voluntary recognition agreements--seems expressly designed to have
the opposite effect. The majority shows no deference toward settled
law, nor does the majority articulate any cognizable basis for
departing from it. The Supreme Court has held that an agency has a duty
``to explain its departure from prior norms.'' Atchison, T. & S. F. Ry.
Co. v. Wichita Bd. of Trade, 412 U.S. 800 (1973). The majority,
however, makes no effort to do so. It instead proposes a reflexive
reversion to an earlier policy--one that was disavowed on a legal and
empirical basis--relying solely on quotations from the Dana majority
and then-Member Hayes' dissent in Lamons. Surely this does not provide
a basis for the ``reasoned decisionmaking'' that is required of the
Board.\100\
---------------------------------------------------------------------------
\99\ Notice of Proposed Rulemaking--The Standard for Determining
Joint-Employer Status, September 14, 2018.
\100\ See, e.g., Allentown Mack Sales & Service, Inc. v. NLRB,
522 U.S. 359, 374 (1998); Fred Meyer Stores, Inc. v. NLRB, 865 F.3d
630, 638 (D.C. Cir. 2017).
---------------------------------------------------------------------------
Affecting a major policy change absent any compelling justification
to do so would, on its own, be sufficient to invite judicial scrutiny.
But the majority goes a step further: It seeks to enshrine that change
as a permanent part of the Board's rules. The majority's reasoning in
this regard is again uncertain. Significantly, no person has filed a
petition for rulemaking on the recognition bar--the Board's traditional
prompt for initiating the rulemaking process. Nor does this proposal
bear any clear relationship to the other proposed rules that the
majority presents here. And although this issue has been raised by
parties to Board proceedings,\101\ the majority has decided to address
it via rulemaking rather than adjudication--most likely because
rulemaking ensures a result that will be more difficult to undo.
---------------------------------------------------------------------------
\101\ See, e.g., L&L Fabrication, 16-RD-232491 (Unpublished
Order, April 22, 2019); Embassy Suites by Hilton, Seattle Downtown
Pioneer Square, 19-RD-223236 (Unpublished Order, January 15, 2019).
---------------------------------------------------------------------------
Concededly, the rulemaking process does permit for the submission
of public input, which can serve an important role in evaluating the
effectiveness of the Board's actions.\102\ But the policy arguments
supporting the Dana approach have already been assessed--and rejected--
by the Lamons Board after solicitation of public input. Because the
Dana procedures have not been in effect for 8 years, it is difficult to
see what kind of new evidence might be available that would undercut
the Board's conclusion in Lamons--that ``the proof of majority support
that underlay voluntary recognition [i]s a highly reliable measure of
employee sentiment.'' \103\ At most, what the majority will provide
with their general request for comments is an opportunity for friendly
parties to rehash the arguments of the Dana majority in support of this
majority's suggested result.
---------------------------------------------------------------------------
\102\ Request for Information--Representation-Case Procedures,
December 14, 2017 (Member McFerran, dissenting) (``Of course,
administrative agencies ought to evaluate the effectiveness of their
actions . . . . and public input can serve an important role in
conducting such evaluations.'').
\103\ 357 NLRB at 742.
---------------------------------------------------------------------------
In fact, the majority's proposal is best viewed not as a response
to a legal obstacle or changed real-world circumstances, but as the
latest in a series of actions that will make it easier to unseat
incumbent unions--all under the guise of protecting employee free
choice. In this way, it is rightly viewed as a counterpart to the
Board's recent decision in Johnson Controls,\104\ in which the same
majority overruled longstanding precedent to permit an employer to
unilaterally withdraw recognition from an incumbent union, at the
expiration of a collective-bargaining agreement, in the face of
objective evidence that the union has not lost majority support of the
employees it represents. Under the majority's approach there, the
incumbent union can regain its representative status--but only if it
petitions for and wins an unnecessary Board election.
---------------------------------------------------------------------------
\104\ 368 NLRB No. 20 (2019).
---------------------------------------------------------------------------
Today's proposal will also facilitate the ouster of incumbent
unions. And although the majority's target here is different--
voluntarily-recognized unions--its apparent objective is the same: To
require unions to overcome an additional procedural hurdle or lose
their lawful, extant representative status. Once again, the majority
touts its ostensible interest in ``ensur[ing] that employee free choice
has not been impaired.'' But in practice--as seen in conjunction with
Johnson Controls--it creates another new mechanism for deposing a union
that has already lawfully secured recognition.
4.
In characterizing its proposed codification of the Dana approach as
``necessary and appropriate,'' the majority attempts to frame Lamons
Gasket as a departure from precedent that must immediately be righted.
In truth, Dana itself was the aberration. Its application marked an
ill-advised 4-year departure from what had been the Board's sensible
and unchallenged approach for 41 years. The majority now seeks to turn
this temporary mistake--one that was properly recognized and
corrected--into a permanent blight on the Board's voluntary recognition
jurisprudence. It does so without any cognizable legal or evidentiary
justification for reviving this approach. While I will certainly
consider with an open mind all comments submitted, it is difficult for
me to see how--in light of statutory history, Board precedent, and
available empirical evidence--the majority will be able to justify
finalizing this proposal at the end of this process.
C. Modified Requirements for Proof of Section 9(a) Relationships in the
Construction Industry
Finally, the majority proposes to adopt a rule providing that, in
the construction industry, neither voluntary recognition of the union
by the employer nor a collective-bargaining agreement between the
parties will bar election petitions filed under Section 9(c) or 9(e) of
the Act ``absent positive evidence'' (as detailed in the rule) that the
collective-bargaining relationship was established under the majority-
support requirement of Section 9(a) of the Act. The proposed rule
states that ``[c]ontract language, standing alone, will not be
sufficient to prove the showing of majority support.'' This approach,
as the majority acknowledges, runs counter to well-established Board
law in unfair labor practice cases.
Beginning with its 2001 decision in Staunton Fuel & Material,
Inc.,\105\ an unfair labor practice case involving the duty to bargain
under Section 8(a)(5) of the Act, the Board has held that when a
construction-industry employer has agreed to a collective-bargaining
agreement that, by its terms, demonstrates that the parties' bargaining
relationship is governed by Section 9(a) of the Act, the employer may
not treat the relationship as governed by Section 8(f) of the Act--and
thus may not unilaterally withdraw recognition from the union when the
agreement expires. In 18 years, the Board has never had occasion to
apply the Staunton Fuel
[[Page 39952]]
principle in a representation case to bar an election petition, whether
filed by an employee, a rival union, or an employer. Today, the
majority attacks Staunton Fuel, but does not propose a rule that would
apply in unfair labor practice cases.\106\ As I will explain, the
majority's proposal purports to solve a non-existent problem, while
failing adequately to acknowledge the actual problem that Staunton Fuel
was intended to address. But even to the extent that the majority
believes it has identified flaws with the Staunton Fuel principle--
which the United States Court of Appeals for the District of Columbia
Circuit has rejected--the better way to address those flaws is through
adjudication. Almost everything about the proposed rule, then, seems
arbitrary.
---------------------------------------------------------------------------
\105\ 335 NLRB 717 (2001).
\106\ The proposed rule does not permit a construction-industry
employer to withdraw recognition where Staunton Fuel would prohibit
it. Nor does it provide that a construction-industry employer
violates Section 8(a)(2) when it recognizes a union as the majority
representative (as reflected in the collective-bargaining
agreement), but cannot prove by ``positive evidence'' that the union
had majority support. Presumably, the majority's failure to address
unfair labor practice issues is related to its decision to combine
rulemaking on the Staunton Fuel issue with two other rulemakings,
neither of which directly involves unfair labor practice issues.
---------------------------------------------------------------------------
To begin, the majority's unprecedented choice to pursue rulemaking
in this area is a dubious way to proceed. My colleagues acknowledge
that ``the number of cases that involve a question of whether a
relationship is governed by Section 8(f) or 9(a) is very small relative
to the total number of construction industry employers and unions.''
These admittedly few cases involve highly individual circumstances that
are more appropriate for case-by-case adjudication than for rulemaking,
which also consumes far more of the Board's resources. Here, moreover,
the majority has chosen to combine rulemaking on a narrow issue with
rulemaking on two far more broadly-applicable issues; thus, the
relatively few employees, unions, and employers interested in the
Staunton Fuel issue will unfairly be required to wade through a large
rulemaking record devoted overwhelmingly to other issues. For these
reasons, the Board would be far better advised to continue doing what
it has always done: Address this issue as it arises in the context of a
contested case with the benefit of a full evidentiary record and
briefing by interested parties. To the extent that the majority
believes that Board action on this issue is compelled by the District
of Columbia Circuit's rejection of Staunton Fuel, the Board is, of
course, free to adhere to current law and seek Supreme Court review in
an appropriate case to resolve the existing Circuit split on this
issue.\107\
---------------------------------------------------------------------------
\107\ See Colorado Fire Sprinkler, Inc. v. NLRB, 891 F.3d 1031
(D.C. Cir. 2018) (criticizing Staunton Fuel); NLRB v. Triple C
Maintenance, Inc., 219 F.3d 1147 (10th Cir. 2000) (applying the test
adopted in Staunton Fuel); NLRB v. Oklahoma Installation Co., 219
F.3d 1160 (10th Cir. 2000) (same); Sheet Metal Workers Local 19 v.
Herre Bros., Inc., 201 F.3d 231 (3d Cir. 1999) (applying the test
adopted in Staunton Fuel). See also Heartland Plymouth Court MI, LC
v. NLRB, 838 F.3d 16, 21-22 (D.C. Cir. 2016) (where federal
appellate courts are in conflict on an issue of federal law, agency
should seek Supreme Court review to resolve dispute).
---------------------------------------------------------------------------
The majority's attack on Staunton Fuel is misplaced in any case.
The majority asserts at length that this rulemaking is necessary to
``restore the protections of employee free choice in the construction
industry.'' But no case involving Staunton Fuel that has reached the
Board has ever arisen from the only situation addressed by the proposed
rule: The filing of an election petition by employees or a rival union.
Rather, the cases have uniformly involved an employer's attempt to
escape a bargaining obligation by unilaterally withdrawing recognition
from the incumbent union and refusing to bargain, resulting in an
unfair labor practice proceeding that has nothing to do with an
election petition.\108\ Notwithstanding its emphatic concern about
employee free choice, the majority cites no cases in which any employee
has been blocked from pursuing a change in representation by the
application of Staunton Fuel.
---------------------------------------------------------------------------
\108\ I am aware of only one Board case involving an employee-
filed decertification petition in connection with a dispute over
whether the parties' bargaining relationship was governed by Sec.
8(f) or Sec. 9(a). In that case the Board ordered an election, even
though the parties were found to have a 9(a) relationship. See H.Y.
Floors and Gameline Painting, 331 NLRB 304 (2000) (employee filed
petition within the statute of limitations period for unfair labor
practices).
---------------------------------------------------------------------------
The majority also mischaracterizes Staunton Fuel and the Board's
aim in that decision. Staunton Fuel must be understood in the context
of the principles established by the Board in an earlier, seminal
decision involving collective-bargaining relationships in the
construction industry. In John Deklewa & Sons,\109\ the Board struck a
proper balance between protecting employee free choice and
accommodating the needs of the construction industry. Under Deklewa,
construction industry bargaining relationships are presumed to be
governed by Section 8(f)--which does not require a union to have
majority support--and a party asserting the existence of a Section 9(a)
relationship bears the burden of proving it.\110\ However, as the
Deklewa Board noted, unions in the construction industry should not be
treated less favorably than unions in other industries where voluntary
recognition is permissible; thus, a Section 8(f) relationship can
become a Section 9(a) relationship through an employer's voluntary
recognition of the union based on a clear showing of majority
support.\111\ Following Deklewa, the Board determined that a union can
establish a Section 9(a) relationship by showing its express demand for
(and an employer's voluntary grant of) recognition to the union as
bargaining representative, based on a contemporaneous showing of union
support among a majority of employees in an appropriate bargaining
unit.\112\
---------------------------------------------------------------------------
\109\ 282 NLRB 1375, 1385 fn. 40 (1987), enfd. sub nom. Iron
Workers Local 3 v. NLRB, 843 F.2d 770 (3d Cir. 1988), cert. denied
488 U.S. 889 (1988).
\110\ 282 NLRB at 1385 fn. 41.
\111\ Id. at 1387 fn. 53.
\112\ Golden West Electric, 307 NLRB 1494, 1495 (1992).
---------------------------------------------------------------------------
There is no dispute, then, that establishing a bargaining
relationship under Section 9(a) requires a proffered showing of
majority support for the union. Staunton Fuel addressed a different
problem: How the Board should determine whether that requirement had
been met at some point in the past--in some cases many years before a
dispute over the union's status has arisen--when a construction-
industry employer attempts to escape a longstanding bargaining
relationship unilaterally.\113\ In that retrospective setting, evidence
confirming that the union had majority support when the relationship
was established may no longer be easily available--witnesses and
documents disappear over time. As it did in Deklewa--and adopting a
standard previously prescribed by the Tenth Circuit \114\--the Board in
Staunton Fuel carefully balanced the relevant interests and found that,
in such cases, negotiated contract language alone could confirm that
majority support had been properly
[[Page 39953]]
established.\115\ The Board also carefully specified what that language
would have to convey: (1) That the union requested recognition as
majority representative; (2) that the employer recognized the union as
majority representative; and (3) that the employer's recognition was
based on the union's having shown, or having offered to show, an
evidentiary basis of its majority support.\116\ At the same time,
Staunton Fuel did not alter the Board's longstanding practice of
considering all available relevant evidence when evaluating the nature
of parties' bargaining relationship, where the contract language alone
was not conclusive.\117\ Nor did Staunton Fuel impair the right of
employees or rival unions to oppose a ``collusive'' Section 9(a)
agreement between their construction employer and a union--the chief
professed concern of the majority--by filing unfair labor practice
charges against both parties with the Board.\118\ In short, by
establishing that collective-bargaining relationships in the
construction-industry are presumed to be governed by Section 8(f), but
that the burden on unions to prove a Section 9(a) relationship is no
higher in construction that outside that industry, Staunton Fuel is not
only consistent with Deklewa principles--it furthers them.
---------------------------------------------------------------------------
\113\ The majority cites International Ladies' Garment Workers'
Union v. NLRB, 366 U.S. 731 (1961), which established that an
employer violates the Act by recognizing a union that in fact lacks
majority support, as authority precluding the Board's approach in
Staunton. However, the Board has already explained why that case is
distinguishable from the situation addressed by Staunton Fuel:
``[a]n employer's failure to review a union's proffered showing of
majority support when the parties executed their contract does not
indicate that the union in fact lacked such support.'' King's Fire
Protection, Inc., 362 NLRB 1056 fn.2 (2015).
\114\ NLRB v. Triple C Maintenance, Inc., supra, 219 F.3d 1147;
NLRB v. Oklahoma Installation Co., supra, 219 F.3d 1160. See also
Sheet Metal Workers Local 19 v. Herre Bros., Inc., supra, 201 F.3d
231.
\115\ Moreover, contrary to the Majority's claim, Staunton Fuel
was not the first time the Board found a Sec. 9(a) relationship
based solely on contract language. See, e.g., Decorative Floors, 315
NLRB 188, 189 (1994); MFP Fire Protection, 318 NLRB 840, (1995),
enfd. 101 F.3d 1341 (10th Cir. 1996).
\116\ Staunton Fuel, supra, 325 NLRB at 719-720. In J & R Tile,
291 NLRB 1034 (1988), cited by the majority and which preceded
Staunton Fuel, the Board found the parties' relationship to be
governed by Sec. 8(f) because the collective-bargaining agreement
merely required unit employees to be members of the union--which was
consistent with either a Sec. 8(f) or a Sec. 9(a) relationship--and
there was no indication in the contract or in any other form that
the union had sought and been granted Sec. 9(a) recognition. The
relationship in J & R Tile, in short, would have been found Sec.
8(f) under Staunton Fuel.
\117\ See Staunton Fuel, supra at 720. n.15 (Board would
continue to consider extrinsic evidence of the parties' intent where
the contract's language is not independently dispositive). See also
J.T. Thorpe and Son, 356 NLRB 822, 824-825 (2011).
\118\ In emphasizing the risk of collusion between employers and
unions to the detriment of employee choice, my colleagues
incorrectly suggest that voluntary recognition outside the
construction industry requires ``undisputed proof of employee
support, through union authorization cards or a pro-union
petition[.]'' That claim is refuted by the Board's decisions. See
Alpha Associates, 344 NLRB 782, 782-783 (2005) (``whether or not the
recognized union had proffered evidence demonstrating its majority
status at the time of recognition is irrelevant.''); Broadmoor
Lumber Co., 227 NLRB 1123, 1135 (1977) (finding, in non-construction
context, that ``no formalism is required to find voluntary
recognition,'' and that ``resolution of whether voluntary
recognition has been granted turns on whether, as a factual matter,
there has been an assertion of recognition by an employer,'' and
thus concluding that ``oral and written statements,'' or even ``an
employer's conduct can be a valid basis for finding voluntary
recognition''), enfd. 578 F.2d 238 (9th Cir. 1978).
---------------------------------------------------------------------------
The majority's proposed rule does not acknowledge the problem that
Staunton addressed and, contrary to Deklewa, it would unjustifiably
treat construction unions less favorably than unions in other
industries. For all of the reasons offered here, I am not persuaded
either that rulemaking is appropriate or that the majority's proposed
rule furthers statutory purposes.
D. Conclusion
I cannot support the majority's decision to issue the proposed
rule. To be sure, I will carefully consider with an open mind both the
public comments that the Board receives and the views of my colleagues.
But based on today's Notice, it is clear that--before finalizing any
rule--the majority must fundamentally reassess its approach and its
proposals if it wishes to engage in reasoned decisionmaking as required
by the Administrative Procedure Act. Unfortunately, I fear that the
shortcomings of the proposed rule--which fails to consider crucial
empirical evidence, misconstrues Board doctrine, and pursues goals that
are contrary to the Act--will inevitably result in a final rule that is
arbitrary and legally deficient. Most importantly, I cannot support the
majority's decision today to embark on a course that seems intended
only to weaken the Act's core protections. For all these reasons, I
dissent.
VI. Regulatory Procedures
The Regulatory Flexibility Act
A. Initial Regulatory Flexibility Analysis
The Regulatory Flexibility Act of 1980 (``RFA''), 5 U.S.C. 601, et
seq., ensures that agencies ``review draft rules to assess and take
appropriate account of the potential impact on small businesses, small
governmental jurisdictions, and small organizations, as provided by the
[RFA].'' \119\ It requires agencies promulgating proposed rules to
prepare an Initial Regulatory Flexibility Analysis (``IRFA'') and to
develop alternatives wherever possible, when drafting regulations that
will have a significant impact on a substantial number of small
entities.\120\ However, an agency is not required to prepare an IRFA
for a proposed rule if the agency head certifies that, if promulgated,
the rule will not have a significant economic impact on a substantial
number of small entities.\121\ The RFA does not define either
``significant economic impact'' or ``substantial number of small
entities.'' \122\ Additionally, ``[i]n the absence of statutory
specificity, what is `significant' will vary depending on the economics
of the industry or sector to be regulated. The agency is in the best
position to gauge the small entity impacts of its regulations.'' \123\
---------------------------------------------------------------------------
\119\ E.O. 13272, Sec. 1, 67 FR 53461 (``Proper Consideration of
Small Entities in Agency Rulemaking'').
\120\ Under the RFA, the term ``small entity'' has the same
meaning as ``small business,'' ``small organization,'' and ``small
governmental jurisdiction.'' 5 U.S.C. 601(6).
\121\ 5 U.S.C. 605(b).
\122\ 5 U.S.C. 601.
\123\ Small Business Administration Office of Advocacy, ``A
Guide for Government Agencies: How to Comply with the Regulatory
Flexibility Act'' (``SBA Guide'') at 18, https://www.sba.gov/sites/default/files/advocacy/How-to-Comply-with-the-RFA-WEB.pdf.
---------------------------------------------------------------------------
As discussed below, the Board is uncertain as to whether its
proposed rule will have a significant economic impact on a substantial
number of small entities. The Board assumes for purposes of this
analysis that a substantial number of small employers and small entity
labor unions will be impacted by this rule because at a minimum, they
will need to review and understand the effect of the substantive
changes to the blocking charge policy, voluntary recognition bar
doctrine, and modified requirements for proof of majority-based
voluntary recognition under Section 9(a) in the construction industry.
Additionally, there may be compliance costs that are unknown to the
Board.
For these reasons, the Board has elected to prepare an IRFA to
provide the public the fullest opportunity to comment on the proposed
rule.\124\ An IRFA describes why an action is being proposed; the
objectives and legal basis for the proposed rule; the number of small
entities to which the proposed rule would apply; any projected
reporting, recordkeeping, or other compliance requirements of the
proposed rule; any overlapping, duplicative, or conflicting Federal
rules; and any significant alternatives to the proposed rule that would
accomplish the stated objectives, consistent with applicable statutes,
and that would minimize any significant adverse economic impacts of the
proposed rule on small entities.\125\ An IRFA also
[[Page 39954]]
presents an opportunity for the public to provide comments that will
shed light on potential compliance costs that are unknown to the Board
or on any other part of the IRFA.
---------------------------------------------------------------------------
\124\ After a review of the comments, the Board may elect to
certify that the rule will not have a significant economic impact on
a substantial number of small entities in the publication of the
final rule. 5 U.S.C. 605(b).
\125\ 5 U.S.C. 603(b).
---------------------------------------------------------------------------
Detailed descriptions of this proposed rule, its purpose,
objectives, and the legal basis are contained earlier in the SUMMARY
and SUPPLEMENTAL INFORMATION sections. In brief, the proposed rule
includes three provisions that aim to better protect the statutory
rights of employees to express their views regarding representation.
First, the proposed rule modifies the current blocking charge policy
and implements a vote and impound procedure to process representation
petitions where a party files or has filed an unfair labor practice
charge. Next, the proposed rule modifies the voluntary recognition bar
doctrine by providing employees and rival unions with a 45-day window
period in which to file an election petition after an employer
voluntarily recognizes a union based on demonstrated majority support.
Lastly, the proposed rule modifying requirements for proof of majority-
based voluntary recognition under Section 9(a) in the construction
industry eliminates the possibility of establishing Section 9(a) status
based solely on contract language drafted by the employer and/or union.
B. Description and Estimate of Number of Small Entities to Which the
Rule Applies
To evaluate the impact of the proposed rule, the Board first
identified the universe of small entities that could be impacted by
changes to the blocking charge and voluntary recognition bar doctrines,
as well as by elimination of the 8(f) to 9(a) conversion through
contract language alone.
1. Blocking Charge and Voluntary Recognition Bar Changes
The blocking charge and voluntary recognition bar changes will
apply to all entities covered by the National Labor Relations Act
(``NLRA'' or ``the Act''). According to the United States Census
Bureau, there were 5,954,684 businesses with employees in 2016.\126\ Of
those, 5,934,985 were small businesses with fewer than 500
employees.\127\ Although the proposed rule would only apply to
employers who meet the Board's jurisdictional requirements, the Board
does not have the means to calculate the number of small businesses
within the Board's jurisdiction.\128\ Accordingly, the Board assumes
for purposes of this analysis that the great majority of the 5,934,985
small businesses could be impacted by the proposed rule.
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\126\ See U.S. Department of Commerce, Bureau of Census, 2016
Statistics of U.S. Businesses (``SUSB'') Annual Data Tables by
Establishment Industry, https://www.census.gov/data/tables/2016/econ/susb/2016-susb-annual.html (from downloaded Excel Table titled
``U.S., 6-digit NAICS'').
\127\ Id. The Census Bureau does not specifically define ``small
business'' but does break down its data into firms with fewer than
500 employees and those with 500 or more employees. Consequently,
the 500-employee threshold is commonly used to describe the universe
of small employers. For defining small businesses among specific
industries, the standards are defined by the North American Industry
Classification System (NAICS).
\128\ Pursuant to 29 U.S.C. 152(6) and (7), the Board has
statutory jurisdiction over private sector employers whose activity
in interstate commerce exceeds a minimal level. NLRB v. Fainblatt,
306 U.S. 601, 606-07 (1939). To this end, the Board has adopted
monetary standards for the assertion of jurisdiction that are based
on the volume and character of the business of the employer. In
general, the Board asserts jurisdiction over employers in the retail
business industry if they have a gross annual volume of business of
$500,000 or more. Carolina Supplies & Cement Co., 122 NLRB 88
(1959). But shopping center and office building retailers have a
lower threshold of $100,000 per year. Carol Management Corp., 133
NLRB 1126 (1961). The Board asserts jurisdiction over non-retailers
generally where the value of goods and services purchased from
entities in other states is at least $50,000. Siemons Mailing
Service, 122 NLRB 81 (1959).
The following employers are excluded from the NLRB's
jurisdiction by statute:
--Federal, state and local governments, including public
schools, libraries, and parks, Federal Reserve banks, and wholly-
owned government corporations. 29 U.S.C. 152(2).
--employers that employ only agricultural laborers, those
engaged in farming operations that cultivate or harvest agricultural
commodities or prepare commodities for delivery. 29 U.S.C. 153(3).
--employers subject to the Railway Labor Act, such as interstate
railroads and airlines. 29 U.S.C. 152(2).
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These two changes will also will impact all labor unions, as
organizations representing or seeking to represent employees. Labor
unions, as defined by the NLRA, are entities ``in which employees
participate and which exist for the purpose . . . of dealing with
employers concerning grievances, labor disputes, wages, rates of pay,
hours of employment, or conditions of work.'' \129\ The Small Business
Administration's (``SBA'') ``small business'' standard for ``Labor
Unions and Similar Labor Organizations'' is $7.5 million in annual
receipts.\130\ In 2012, there were 13,740 labor unions in the U.S.\131\
Of these unions, 11,245 had receipts of less than $1,000,000; 2,022
labor unions had receipts between $1,000,000 and $4,999,999; and 141
had receipts between $5,000,000 and $7,499,999. In aggregate, 13,408
labor unions (97.6% of total) are small businesses according to SBA
standards.
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\129\ 29 U.S.C. 152(5).
\130\ See 13 CFR 121.201.
\131\ The Census Bureau only provides data about receipts in
years ending in 2 or 7. The 2017 data has not been published, so the
2012 data is the most recent available information regarding
receipts. See U.S. Department of Commerce, Bureau of Census, 2012
SUSB Annual Data Tables by Establishment Industry, https://www2.census.gov/programs-surveys/susb/tables/2012/us_6digitnaics_r_2012.xlsx (Classification #813930--Labor Unions and
Similar Labor Organizations).
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The proposed blocking charge policy change will only be applied as
a matter of law under certain circumstances in a Board proceeding,
namely, when a party to a representation proceeding files an unfair
labor practice charge alleging conduct that could result in setting
aside the election or dismissal of the petition. Therefore, the
frequency with which the issue arises is indicative of the number of
small entities most directly impacted by the proposed rule. For
example, in Fiscal Year 2018, 1,408 petitions were filed and proceeded
to an election, of which 44 petitions were subject to a blocking
charge. Thus, the current blocking charge policy directly impacted
3.125% of petitions filed in Fiscal Year 2018, which is only a de
minimis amount of all small entities under the Board's jurisdiction.
Similarly, the number of small entities expected to be most
directly impacted by the modified voluntary recognition bar doctrine is
also low. When the modified voluntary recognition bar was previously in
effect, the Board tracked the number of requests for Dana notices,
which were used to inform employees that a voluntary recognition had
taken place and of their right to file a petition for an election.
These are similar to the notices that would be required under this
proposed rule. From September 29, 2007, to May 13, 2011, the Board
received 1,333 requests for Dana notices, which is an average of 372
requests per year.\132\ Assuming each request was made by a distinct
employer and involved at least one distinct labor organization, at
least 744 entities of various sizes were impacted each year that the
modified voluntary recognition bar was in effect.\133\
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\132\ Lamons Gasket Co., 357 NLRB at 742.
\133\ Dana Corp., 351 NLRB 434 (establishing a 45-day ``window
period'' after voluntary recognition during which employees could
file an election petition supported by a 30-percent showing of
interest seeking decertification or representation by an alternative
union).
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2. Elimination of Contract Language Basis for Proving 9(a) Recognition
in the Construction Industry
The Board believes that the proposed elimination of the contract-
language basis for proving majority-supported voluntary recognition is
only relevant to construction-industry small employers and labor unions
because Section 8(f) of the Act applies solely to such entities
[[Page 39955]]
engaged in the building and construction industries. These
construction-industry employers are classified under the NAICS Sector
23 Construction.\134\ Of the 640,951 employers included in those NAICS
definitions, 633,135 are small employers that fall under the SBA
``small business'' standard for classifications in the NAICS
Construction sector.\135\ The Board has identified 3,929 small labor
unions primarily operating in the building and construction trades that
fall under the SBA ``small business'' standard for the NAICS
classification ``Labor Unions and Similar Labor Organizations'' of
annual receipts of less than $7.5 million.\136\
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\134\ These NAICS construction-industry classifications include
the following codes: 236115: New Single-Family Housing Construction;
236116: New Multifamily Housing Construction; 236117: New Housing
For-Sale Builders; 236118: Residential Remodelers; 236210:
Industrial Building Construction; 236220: Commercial and
Institutional Building Construction; 237110: Water and Sewer Line
and Related Structures Construction; 237120: Oil and Gas Pipeline
and Related Structures Construction; 237130: Power and Communication
Line and Related Structures Construction; 237210: Land Subdivision;
237310: Highway, Street, and Bridge Construction; 237990: Other
Heavy and Civil Engineering Construction; 238110: Poured Concrete
Foundation and Structure Contractors; 238120: Structural Steel and
Precast Concrete Contractors; 238130: Framing Contractors; 238140:
Masonry Contractors; 238150: Glass and Glazing Contractors; 238160:
Roofing Contractors; 238170: Siding Contractors; 238190: Other
Foundation, Structure, and Building Exterior Contractors; 238210:
Electrical Contractors and Other Wiring Installation Contractors;
238220: Plumbing, Heating, and Air-Conditioning Contractors; 238290:
Other Building Equipment Contractors; 238310: Drywall and Insulation
Contractors; 238320: Painting and Wall Covering Contractors; 238330:
Flooring Contractors; 238340: Tile and Terrazzo Contractors; 238350:
Finish Carpentry Contractors; 238390: Other Building Finishing
Contractors; 238910: Site Preparation Contractors; 238990: All Other
Specialty Trade Contractors. See U.S. Department of Commerce, Bureau
of Census, 2012 SUSB Annual Data Tables by Establishment Industry,
NAICS classification #561320, https://www2.census.gov/programs-surveys/susb/tables/2012/us_6digitnaics_r_2012.xlsx.
\135\ NAICS codes 236115-237130 and 237310-237990 have a small
business threshold of $36.5 million in annual receipts; NAICS code
237210 has a threshold of $27.5 million in annual receipts; and
NAICS codes 238110-238990 have a threshold of $15 million in annual
receipts. See 13 CFR 121.201.
\136\ The Department of Labor's Office of Labor-Management
Standards (OLMS) provides a searchable database of union annual
financial reports. However, OLMS does not identify unions by
industry, e.g., construction. Accordingly, the Board does not have
the means to determine a precise number of unions primarily
operating in the building and construction industries. The Board
nonetheless has identified the following unions as primarily
operating in these industries: The International Union of
Bricklayers and Allied Craftworkers; Building and Construction
Trades Department; International Association of Bridge, Structural,
Ornamental & Reinforcing Iron Workers; Operative Plasterers' and
Cement Masons' International Association; Laborers' International
Union; The United Brotherhood of Carpenters and Joiners of America;
International Union of Operating Engineers; International Union of
Journeymen and Allied Trades; International Association of Sheet
Metal, Air, Rail, and Transportation Workers; International Union of
Painters and Allied Trades; International Brotherhood of Electrical
Workers; United Association of Journeymen Plumbers; United Union of
Roofers, Waterproofers and Allied Workers; United Building Trades;
International Association of Heat and Frost Insulators and Allied
Workers; and International Association of Tool Craftsmen. See U.S.
Department of Labor, Office of Labor-Management Standards, Online
Public Disclosure Room, Download Yearly Data for 2012, https://olms.dol-esa.gov/olpdr/GetYearlyFileServlet?report=8H58. Input from
the public is welcome as to any labor organization not listed that
primarily operates in the building and construction industries.
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It is unknown how many of those small construction-industry
employers elect to enter into a 9(a) bargaining relationship with a
small labor union based on language in a collective-bargaining
agreement. However, once again, the number of cases that involve a
question of whether a relationship is governed by Section 8(f) or 9(a)
is very small relative to the total number of construction industry
employers and unions. For example, only one case was filed in Fiscal
Year 2017 where the Board ultimately had to determine whether a
collective-bargaining agreement was governed by Section 8(f) or
9(a).\137\ In Fiscal Year 2016, no cases required the Board to
determine whether a collective-bargaining agreement was governed by
8(f) or 9(a). One case was filed in Fiscal Year 2015 that came before
the Board with the 8(f) or 9(a) collective-bargaining agreement
issue.\138\
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\137\ See AFP Specialties, Inc., Case 07-RD-187706 (unpublished
Order dated May 18, 2017).
\138\ See Loshaw Thermal Technology, Inc., Case 05-CA-158650.
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The historic filing data thus suggests that construction industry
employers and labor unions will only be most directly impacted in a
small number of instances relative to the number of those types of
small entities identified above.
C. Recordkeeping, Reporting, and Other Compliance Costs
The RFA requires agencies to consider the direct burden that
compliance with a new regulation will likely impose on small
entities.\139\ Thus, the RFA requires the Board to determine the amount
of ``reporting, recordkeeping and other compliance requirements''
imposed on small entities.\140\
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\139\ See Mid-Tex Elec. Co-op v. FERC, 773 F.2d 327, 342 (D.C.
Cir. 1985) (``[I]t is clear that Congress envisioned that the
relevant `economic impact' was the impact of compliance with the
proposed rule on regulated small entities.'').
\140\ See 5 U.S.C. 603(b)(4), 604(a)(4).
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The Board concludes that the proposed rule imposes no capital costs
for equipment needed to meet the regulatory requirements; no lost sales
and profits resulting from the proposed rule; no changes in market
competition as a result of the proposed rule and its impact on small
entities or specific submarkets of small entities; and no costs of
hiring employees dedicated to compliance with regulatory
requirements.\141\
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\141\ SBA Guide at 37.
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Small entities may incur some costs from reviewing the rule in
order to understand the substantive changes. To become generally
familiar with the new vote and impound procedure and the modified
voluntary recognition bar, the Board estimates that a human resources
specialist at a small employer or labor union may take at most ninety
minutes to read the rule. It is also possible that a small employer or
labor union may wish to consult with an attorney, which the Board
estimates will require one hour. Using the Bureau of Labor Statistics'
estimated wage and benefit costs, the Board has assessed these labor
costs to be $147.12.\142\ The costs associated with the portion of the
rule that eliminates the contract-language basis for establishing
voluntary recognition under Section 9(a) are limited to small employers
and unions in the construction industry. To become generally familiar
with that change, in addition to the first two changes, the Board
estimates that a human resources specialist at a small employer or
union in the construction industry may take at most two hours to read
the entire rule. Consultation with an attorney may take an additional
fifteen minutes, or seventy-five minutes to consult with an attorney
regarding the entire rule. Thus, the Board has assessed labor costs for
small employers and unions in the construction industry to be $189.48.
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\142\ For wage figures, see May 2017 National Occupancy
Employment and Wage Estimates, found at https://www.bls.gov/oes/current/oes_nat.htm. The Board has been administratively informed
that BLS estimates that fringe benefits are approximately equal to
40 percent of hourly wages. Thus, to calculate total average hourly
earnings, BLS multiplies average hourly wages by 1.4. In May 2017,
average hourly wages for a Human Resources Specialist (BLS #13-1071)
were $31.84. The same figure for a lawyer (BLS #23-1011) was $57.33.
Accordingly, the Board multiplied each of those wage figures by 1.4
and added them to arrive at its estimate.
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Establishment of Vote and Impound Procedure
Although the Board does not foresee any additional compliance costs
related to eliminating the blocking charge policy, this policy change
would cause some elections to occur sooner, and in some cases would
lead to elections that previously would not have occurred
[[Page 39956]]
under the prior policy. Arguably, the time compression of holding an
election under the Board's normal election timeline may create
additional costs for small businesses that do not have in-house legal
departments or ready access to outside labor attorneys or consultants,
and that consequently need to pay overtime costs to obtain such
assistance.\143\ Conversely, because the Board's current blocking
charge policy appears susceptible to manipulation and abuse,\144\ the
elimination of the blocking charge policy may result in fewer unfair
labor practice charges filed with the intent to forestall employees
from exercising their right to vote. This would create fewer costs for
small employers by eliminating the need to hire a labor attorney to
defend against such charges. It could also create additional costs for
small labor unions that have to prepare for an election that may have
otherwise been postponed or that may subsequently be set aside. The
Board is not aware of a basis for estimating any such costs and
welcomes any comment or data on this topic.\145\
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\143\ Representation-Case Procedures, 79 FR 74307, 74463 (Dec.
15, 2014).
\144\ See cases cited in the supplemental information section
above.
\145\ The RFA explains that in providing initial and final
regulatory flexibility analyses, ``an agency may provide either a
quantifiable or numerical description of the effects of a proposed
rule or alternatives to the proposed rule, or more general
descriptive statements if quantification is not practicable or
reliable.'' 5 U.S.C. 607 (emphasis added).
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The Board believes that any costs from participating in quicker
elections or elections that would have not otherwise occurred are
limited to very few employers, comparing the limited number of Board
proceedings where an unfair labor practice charge has been filed
contemporaneously with an election petition with the high number of
employers that are subject to the Board's jurisdiction.
Modification of Voluntary Recognition Bar
In a case in which an employer voluntarily recognizes a union, the
Board estimates that the employer will spend an estimated 1 hour and 45
minutes to comply with the rule. This includes 30 minutes for the
employer or union to notify the local regional office of the Board in
writing of the grant of voluntary recognition by submitting a copy of
the recognition agreement, 60 minutes to open the notice sent from the
Board, insert certain information specific to the parties to the
voluntary recognition, and post the notice physically and
electronically, depending on where and how the employer customarily
posts notices to employees, and 15 minutes to complete the
certification of posting form to be returned to the Region at the close
of the notice posting period. The Board assumes that these activities
will be performed by a human resources specialist for a total cost of
about $78.\146\
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\146\ See note 68 for wage figures.
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The Board's modified voluntary recognition bar will cause elections
to be held in cases in which the election petition would have
previously been dismissed, increasing costs for both employers and
unions. Should a commenter provide data demonstrating the cost of
having an election after an employer has granted voluntary recognition,
the Board will consider that information.
Elimination of Contract-Language Basis for Proving Voluntary
Recognition Under Section 9(a) in the Construction Industry
Under current Board law a construction-industry employer and union
can write into their collective-bargaining agreement that the union
showed or offered to show evidence of majority support and, in
combination with certain other contractual language, have the
bargaining relationship be governed under Section 9(a). As described
above, the proposed rule eliminates the contract-language basis for
establishing a 9(a) bargaining relationship but continues to allow two
other methods to establish a 9(a) bargaining relationship: A Board-
certified election and voluntary recognition based on demonstrated
majority support. In cases where an election petition is filed, both
the construction industry employer and labor union would incur the cost
of participating in an election. In cases where a construction-industry
employer voluntarily recognizes a union based on demonstrated majority
support, the union may incur additional costs related to the retention
of the evidence of majority support, e.g., signed union authorization
cards, for a longer period of time if it can no longer rely on
contractual language.
D. Overall Economic Impacts
The Board does not find the estimated, quantifiable cost of
reviewing and understanding the rule--$189.48 for small employers and
unions in the construction industry and $147.12 for all other small
employers and unions--to be significant within the meaning of the RFA.
The estimated $78 cost of complying with the modified voluntary
recognition procedures, which will only apply to the small number of
employers that choose to have their voluntary recognition of a union be
a bar to a future election petition, is also not significant within the
meaning of the RFA.
In making this finding, one important indicator is the cost of
compliance in relation to the revenue of the entity or the percentage
of profits affected.\147\ Other criteria to be considered are the
following:
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\147\ See SBA Guide at 18.
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--Whether the rule will cause long-term insolvency, i.e.,
regulatory costs that may reduce the ability of the firm to make future
capital investment, thereby severely harming its competitive ability,
particularly against larger firms;
--Whether the cost of the proposed regulation will (a) eliminate
more than 10 percent of the businesses' profits; (b) exceed one percent
of the gross revenues of the entities in a particular sector, or (c)
exceed five percent of the labor costs of the entities in the
sector.\148\
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\148\ Id. at 19.
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The minimal cost to read and understand the rule will not generate
any such significant economic impacts.
Since the only quantifiable impacts that the Board has identified
are the $169.41 that may be incurred in reviewing and understanding the
rule and the $78 for certain employers to comply with the modified
voluntary recognition bar, the Board does not believe there will be a
significant economic impact on a substantial number of small entities
associated with this proposed rule. The Board welcomes input from the
public regarding additional costs of compliance not identified by the
Board or costs of compliance the Board identified but lacks the means
to accurately estimate.
E. Duplicate, Overlapping, or Conflicting Federal Rules
Agencies are required to include in an IRFA ``all relevant Federal
rules which may duplicate, overlap or conflict with the proposed
rule.'' \149\ The Board has not identified any such federal rules, but
welcomes comments that suggest any potential conflicts not noted in
this section.
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\149\ 5 U.S.C. 603(b)(5).
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F. Alternatives Considered
Pursuant to 5 U.S.C. 603(c), agencies are directed to look at ``any
significant alternatives to the proposed rule which accomplish the
stated objectives of applicable statutes and which minimize any
significant economic impact of the
[[Page 39957]]
proposed rule on small entities.'' Specifically, agencies must consider
establishing different compliance or reporting requirements or
timetables for small entities, simplifying compliance and reporting for
small entities, using performance rather than design standards, and
exempting small entities from any part of the rule.\150\
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\150\ 5 U.S.C. 603(c).
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First, the Board considered taking no action. Inaction would leave
in place the current blocking charge policy and immediate voluntary
recognition bar and allow for continued establishment of Section 9(a)
bargaining relationships in the construction industry based on contract
language alone. However, for the reasons stated in Sections I through
III above, the Board finds it desirable to revisit these policies and
to do so through the rulemaking process. Consequently, the Board
rejects maintaining the status quo.
Second, the Board considered creating exemptions for certain small
entities. This was rejected as impractical, considering that exemptions
for small entities would substantially undermine the purposes of the
proposed rule because such a large percentage of employers and unions
would be exempt under the SBA definitions. Specifically, to exempt
small entities from the decision to eliminate the blocking charge
policy would leave most small entities without the benefits of the
superior vote-and-impound procedure. To exempt small entities from the
modified voluntary recognition bar or to alter the notice posting
timelines would be contrary to the purpose of the rule: Providing
employees prompt notice of the employer's voluntary recognition of a
union and of employees' right to petition to decertify that union or to
support a different union. Similarly, to exempt small construction-
industry entities from the elimination of the contract-language basis
for establishing a Section 9(a) relationship would not serve the
purpose of that change because the vast majority of employers in the
construction industry are considered to be ``small employers.''
Further, it seems unlikely that drawing this distinction would be a
permissible interpretation of the relevant statutory provisions. Also,
if a large construction-industry employer entered into a bargaining
relationship with a small labor union, both entities would be exempted,
further undermining the policy behind this provision.
Moreover, given the very small quantifiable cost of compliance, it
is possible that the burden on a small business of determining whether
it fell within a particular exempt category might exceed the burden of
compliance. Congress gave the Board very broad jurisdiction, with no
suggestion that it wanted to limit coverage of any part of the Act to
only larger employers. As the Supreme Court has noted, ``[t]he [NLRA]
is federal legislation, administered by a national agency, intended to
solve a national problem on a national scale.'' \151\ As such, this
alternative is contrary to the objectives of this rulemaking and of the
NLRA.
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\151\ NLRB v. Nat. Gas Util. Dist. of Hawkins Cty., 402 U.S.
600, 603-04 (1971) (quotation omitted).
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Because no alternatives considered will accomplish the objectives
of this proposed rule while minimizing costs on small businesses, the
Board believes that proceeding with this rulemaking is the best
regulatory course of action. The Board welcomes public comment on any
facet of this IRFA, including alternatives that it has failed to
consider.
Paperwork Reduction Act
The NLRB is an agency within the meaning of the Paperwork Reduction
Act (``PRA''). 44 U.S.C. 3502(1) and (5). The PRA creates rules for
agencies for the ``collection of information,'' 44 U.S.C. 3507, which
is defined as ``the obtaining, causing to be obtained, soliciting, or
requiring the disclosure to third parties or the public, of facts or
opinions by or for an agency, regardless of form or format,'' 44 U.S.C.
3502(3)(A). Collections of information that occur ``during the conduct
of an administrative action or investigation involving an agency
against specific individuals or entities'' are exempt from the PRA. 44
U.S.C. 3518(c)(1)(B)(ii); 5 CFR 1320.4(a)(2).
As a preliminary matter, the new vote and impound procedure does
not require any collection of information, so the PRA does not apply.
The two remaining changes contained in this proposed rule are
exempt from the PRA because any potential collection of information
would take place in the context of a representation or unfair labor
practice proceeding, both of which are administrative actions within
the meaning of the PRA. As the Board noted in its 2014 rulemaking, the
Senate Report on the PRA makes it clear that the exemption in ``Section
3518(c)(1)(B) is not limited to agency proceedings of a prosecutorial
nature but also include[s] any agency proceeding involving specific
adversary parties.'' Representation-Case Procedures, 79 FR 74306, 74468
(Dec. 15, 2014) (quoting S. Rep. No. 96-930, at 56 (1980)). See also 5
CFR 1320.4(c) (OMB regulation interpreting the PRA, providing that
exemption applies ``after a case file or equivalent is opened with
respect to a particular party.''). Every representation and unfair
labor practice proceeding involves specific adversary parties, and the
outcome is binding on and thereby alters the legal rights of those
parties. See 79 FR 74469.
Specifically, the proposed modified voluntary recognition bar
change triggers a three-step proceeding specific to an employer and
union: (1) An employer or a union gives the Board notice of a voluntary
recognition of a union, (2) the Board provides the employer with an
individualized notice to be posted for a 45-day period, and (3) the
employer certifies to the Board that the notice posting occurred. The
proceeding closes once the Board receives the completed certification
form. Because this proceeding is an administrative action involving
specific adversary parties, it falls within the PRA exemption.
The voluntary recognition will only bar a decertification petition
if the employer opts to post the notice and no decertification petition
is filed within the 45-day period described above. If either of those
conditions is not met, a decertification petition filed by an employee
or a representation petition filed by a rival labor organization could
potentially trigger an election proceeding that would also fall within
the PRA exemption.
The proposed elimination of establishing a Section 9(a)
relationship in the construction industry based solely on contract
language will require unions that wish to achieve Section 9(a) status
to collect and retain proof of majority support, to the extent that the
union's majority status may be challenged in a potential unfair labor
practice or representation proceeding. Both kinds of proceedings fall
within the PRA exemption described above.\152\
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\152\ As acknowledged in the Initial Regulatory Flexibility
Analysis above, all three of the proposed changes may lead to
elections that would not have been held under the prior policies.
Nonetheless, particular collections of information required during
the course of an election proceeding are not attributable to the
instant proposed rule; instead, such requirements flow from prior
rules, including the 2014 election rule. And in any event, even if
such collections of information were attributable to this proposed
rule, an election is a representation proceeding and therefore
exempt from the PRA.
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Accordingly, the proposed rules do not contain information
collection requirements that require approval of the Office of
Management and Budget under the PRA.
[[Page 39958]]
Text of the Proposed Rule
For the reasons discussed in the preamble, the Board proposes to
amend 29 CFR part 103 as follows:
PART 103--OTHER RULES
0
1. The authority citation for part 103 continues to read as follows:
Authority: 29 U.S.C. 156, in accordance with the procedure set
forth in 5 U.S.C. 553.
0
2. Revise Sec. 103.20 to read as follows:
Sec. 103.20 Election procedures and blocking charges; filing of
blocking charges; simultaneous filing of offer of proof; prompt
furnishing of witnesses; vote and impound procedure.
Whenever any party to a representation proceeding files an unfair
labor practice charge together with a request that it block the
election process, or whenever any party to a representation proceeding
requests that its previously filed unfair labor practice charge block
the election process, the party shall simultaneously file, but not
serve on any other party, a written offer of proof in support of the
charge. The offer of proof shall provide the names of the witnesses who
will testify in support of the charge and a summary of each witness's
anticipated testimony. The party seeking to block the election process
shall also promptly make available to the regional director the
witnesses identified in its offer of proof. The regional director shall
continue to process the petition and conduct the election. If the
charge has not been withdrawn, dismissed, or settled prior to the
conclusion of the election, the ballots shall be impounded until there
is a final determination regarding the charge and its effect, if any,
on the election petition or fairness of the election.
0
3. Add Sec. 103.21 to subpart B to read as follows:
Sec. 103.21 Processing of petitions filed after voluntary
recognition under Section 9(a); proof of Section 9(a) bargaining
relationship between employer and labor organization in the
construction industry.
(a) An employer's voluntary recognition of a labor organization as
exclusive bargaining representative of an appropriate unit of the
employer's employees under Section 9(a) of the Act, and any collective-
bargaining agreement executed by the parties on or after the date of
voluntary recognition, will not bar the processing of an election
petition unless:
(1) The employer and labor organization notify the Regional office
that recognition has been granted;
(2) The employer posts a notice of recognition (provided by the
Regional Office) informing employees that recognition has been granted
and that they have a right, during a 45-day ``window period,'' to file
a decertification or rival-union petition; and
(3) 45 days from the posting date pass without a properly supported
petition being filed.
(b) A voluntary recognition or collective-bargaining agreement
between an employer primarily engaged in the building and construction
industry and a labor organization will not bar any election petition
filed pursuant to Section 9(c) or 9(e) of the Act absent positive
evidence that the union unequivocally demanded recognition as the
Section 9(a) exclusive bargaining representative of employees in an
appropriate bargaining unit, and that the employer unequivocally
accepted it as such, based on a contemporaneous showing of support from
a majority of employees in an appropriate unit. Contract language,
standing alone, will not be sufficient to prove the showing of majority
support.
Dated: August 6, 2019.
Roxanne Rothschild,
Executive Secretary.
[FR Doc. 2019-17105 Filed 8-9-19; 8:45 am]
BILLING CODE 7545-01-P