The Pendulum Swings: Trump Labor Board Overturns Several Key Obama Era Decisions - Articles

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Posted by: Greg Grisham on Feb 9, 2018

President Trump’s Senate confirmed appointments to the National Labor Relations Board (“NLRB” or “Board”),Marvin E. Kaplan and William J. Emanuel, recently joined with now former Chairman Philip A. Miscimarra to overturn several important Obama-era NLRB decisions. While more Obama-era NLRB precedents are expected to be reversed, this article will examine four NLRB decisions issued in December 2017 that changed the labor landscape in a positive way for employers.

 

1. UPMC Presbyterian Hospital, 365 NLRB No. 153 (Dec. 11, 2017)

InUPMC Presbyterian Hospital, the Board revisited the issue of whether an administrative law judge (ALJ”) could accept a partial settlement offer made by a respondent to resolve an important issue in the case where the NLRB’s general counsel and/or the charging party objected to the settlement offer. One of the respondents (“respondent 1”) in the case was alleged to be a single employer and responsible for alleged unfair labor practices committed by a subsidiary (“respondent 2”). Respondent 1 made a settlement offer to the ALJ to resolve the single employer issue by agreeing to guarantee any remedy ultimately awarded based on the conduct of respondent 2. The ALJ agreed to accept the offer over the objections of the general counsel and charging party. The ALJ’s decision to accept the settlement offer was appealed to the Board.

 

In finding that the ALJ acted properly in accepting the settlement offer, the Board reversed its prior decision in United States Postal Service, 364 NLRB No. 116 (2016), which held “judges are no longer permitted to accept a respondent’s offered settlement terms, over the objection of the General Counsel and charging party or parties, unless the offer constitutes ‘a full remedy for all of the violations alleged in the complaint.’”[i] The NLRB agreed with Chairman Miscimarra’s dissenting opinion in United States Postal Servicewhich argued the holding “imposed an unacceptable constraint on the Board itself, which retained the right under prior law to review the reasonableness of any respondent’s offered settle­ment terms that were accepted by the judge.”[ii]In overruling United States Postal Service  the Board “return[ed] to the Board’s prior practice of analyzing all settlement agreements, including consent settlement agreements, under the “reasonableness” standard set forth in Independent Stave, 287 NLRB 740 (1987).”[iii]

 

2. Hy-Brand Industrial Contractors, Ltd., 365 NLRB No. 156 (Dec. 14, 2017)

The Board revisited its decision in Browning-Ferris Industries of California, Inc. (Browning-Ferris), 362 NLRB No. 186 (2015) which held “even when two entities have never exercised joint control over essential terms and conditions of employment, and even when any joint control is not ‘direct and immediate,’ the two enti­ties will still be joint employers based on the mere exist­ence of ‘reserved’ joint control, or based on indirect control or control that is ‘limited and routine.’” [iv] The Board “concluded that the common law and numerous policy considerations favor abandoning the Browning-Ferris joint-employer standard [and]… reinstate[d] the joint-employer standard that existed prior to the Brown­ing-Ferris decision.”[v] In place of the standard announced in Browning-Ferris, the Board held “a find­ing of joint-employer status requires proof that the al­leged joint-employer entities have actually exercised joint control over essential employment terms (rather than merely having ‘reserved’ the right to exercise con­trol), the control must be ‘direct and immediate’ (rather than indirect), and joint-employer status will not result from control that is ‘limited and routine.’”[vi]

 

3. PCC Structurals, Inc., 365 NLRB No. 160 (Dec. 15, 2017)

The Board overruled the so-called “micro-unit” bargaining unit test established in Specialty Healthcare & Rehabilitation Center of Mobile, 357 NLRB 934 (2011) (“Specialty Healthcare”) and “reinstate[d] the traditional community-of interest standard as articulated in United Operations, Inc., 338 NLRB 123 (2002).” Under the Specialty Healthcare standard, “when a union seeks to repre­sent a unit of employees ‘who are readily identifiable as a group (based on job classifications, departments, func­tions, work locations, skills, or similar factors), and the Board finds that the employees in the group share a community of interest after considering the traditional criteria, the Board will find the petitioned-for unit to be an appropriate unit’ for bargaining.”[vii] If the employer seeks to add additional employees to the unit found to be appropriate by the Board, the employer has the burden “to demonstrate that the additional employees the proponent seeks to include ‘share “an overwhelming community of interest”’ with the petitioned-for employees, ‘such that there “is no legitimate basis upon which to exclude cer­tain employees from”’ the petitioned-for unit because the traditional community-of-interest factors ‘overlap al­most completely.’”[viii] In abandoning the Specialty Healthcare standard, the NLRB reaffirmed the community of interest test noting that the Board in each case must determine:

whether the employees are organized into a separate department; have distinct skills and training; have dis­tinct job functions and perform distinct work, including inquiry into the amount and type of job overlap be­tween classifications; are functionally integrated with the Employer’s other employees; have frequent contact with other employees; interchange with other employ­ees; have distinct terms and conditions of employment; and are separately supervised.[ix]

In making a determination on the appropriateness of a petitioned-for unit, the Board further stated that it was “not constrained by whether or not an ‘overwhelming’ community of interest exists be­tween petitioned-for employees and those excluded from that unit [and noted]…, where applicable, the analysis must con­sider guidelines that the Board has established for specific industries with regard to appropriate unit configurations.”[x]

 

4. Raytheon Network Centric Systems, 365 NLRB No. 161 (Dec. 15, 2017)

In Raytheon, the Board overruled its decision in E.I. DuPont de Nemours, 364 NLRB No. 113 (2016) (“DuPont”), which prohibited unilateral changes after the expiration of a collective bargaining agreement (“CBA”) where the CBA or a past practice allowed the employer to take unilateral action. In DuPont, the Board held “even if an employer continues to do precisely what it had done many times previously—for years or even decades—taking the same actions consti­tutes a ‘change,’ which must be preceded by notice to the union and the opportunity for bargaining, if a CBA permitted the employer’s past actions and the CBA is no longer in effect.”[xi] In overruling DuPont, the NLRB explained the basis for its decison:

 

Under Katz, an employer must provide notice and the opportunity for bargaining before making a “change” in employment matters. It is equally clear, as demonstrated by innumerable Board and court decisions interpreting Katz, that bargaining is not required when no “change” has occurred. Where, as here, the employer takes actions that are not materially different from what it has done in the past, no “change” has occurred and the employer’s unilateral actions do not violate Section 8(a)(5) of the Act.[xii]

 

5. Takeaways.

 The recent NLRB decisions discussed above reflect the Trump Board’s interest in reviewing and overturning significant Obama-era decisions that departed from established precedents. This is welcomed news for employers. All four decisions issued prior to the December 16 departure of Republican Member Chairman Miscimarra upon the expiration of his term. President Trump has nominated management-side attorney John Ring to fill the current Board vacancy.Once Ring is confirmed by the Senate, the 3 to 2 Republican majority on the Board will no doubt continue to look for opportunities to overturn additional Obama-era Board decisions which will likely further benefit employers.

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J. Gregory Grisham is a Partner in the Nashville and Memphis Offices of Ford Harrison, LLP and focuses his practice on the representation of employers in all aspects of labor and employment law. He received his JD, with honors, from the University of Memphis, Cecil C. Humphreys School of Law in 1989. Greg may be reached at ggrisham@fordharrison.com

 or 615-574-6707.


[i] UPMC Presbyterian Hospital, 365 NLRB No. 153, at p. 1.

[ii] Id.

[iii] Id. The Board in Independent Stave[page 743] stated it “will evaluate the settlement in light of all factors present in the case to determine whether it will effectuate the purposes and policies of the Act to give effect to the settlement.”

[iv] Hy-Brand Industrial Contractors, Ltd.,365 NLRB No. 156, at p. 1 (citations and footnotes omitted).

[v] Id. at p. 33.

[vi] Id. at p. 35.

[vii] PCC Structurals, Inc., 365 NLRB No. 160 (quoting Specialty Healthcare, 357 NLRB at 945–946).

[viii] Id. (quoting Specialty Healthcare, 357 NLRB at 944, additional citation omitted).

[ix] Id. at p. 11.

[x] Id.

[xi] Raytheon, 365 NLRB No.161, at p. 1.

[xii] Id. at p. 20 (citing NLRB v. Katz, 369 U.S. 736 (1962)).The employer in Raytheon “was alleged to have violated Section 8(a)(5) of the National Labor Relations Act (NLRA or Act) in 2013, following expiration of its collective-bargaining agreement (CBA), when it unilat­erally modified employee medical benefits and related costs consistent with what it had done in the past.” Id.at p. 1.