Trump’s NLRB Nominees Would Restore Common Sense to Workplace Relations

In recent years, as Union Corruption Update has noted, the National Labor Relations Board might be called the National Organized Labor Relations Promotion Board. This assessment soon may need some revision. Last month, President Trump nominated Marvin Kaplan and William Emanuel, each an experienced labor lawyer, to fill two vacancies at the normally five-member NLRB. The board is primed to revisit such contentious issues as the appropriate time frame of a union election campaign and the applicability of micro-unit bargaining. If approved, the nominees are likely to shift the NLRB back toward its traditional role of impartial arbiter and away from its current unofficial role of union partisan. Sen. Lamar Alexander, R-Tenn., who will chair the hearings, has vowed to move quickly.

The National Labor Relations Board, established by the National Labor Relations Act of 1935 (NLRA), is a federal agency based in Washington, D.C. with 26 regional offices. Its primary responsibilities are supervising union elections and adjudicating labor-management disputes. The board’s mission, in its own words, is to guarantee “the right of most private-sector employees to organize, to engage in group efforts to improve their wages and working conditions, to determine whether to have unions as their bargaining representative, to engage in collective bargaining, and to refrain from any of these activities. It acts to prevent and remedy unfair labor practices committed by private-sector employers and unions.” This sounds even-handed. In practice, however, things don’t always go according to script.

During the eight years of the Obama administration, the National Labor Relations Board became an advocate of union interests all but in name. A study published last December by the Washington, D.C.-based Coalition for a Democratic Workplace estimated that the NLRB during that time overturned more than 4,500 years of cumulative substantive precedent. Another study, released several weeks later by the U.S. Chamber of Commerce’s Workforce Freedom Initiative, described many of the key cases. The report, titled, “Restoring Common Sense to Labor Law: Ten Policies to Fix at the National Labor Relations Board,” explained how the board, selectively and deceptively interpreting NLRA statutes, had abandoned even the pretense of balancing the interests of management and labor.

There were two principal reasons for this shift. First, for decades there has been an informal rule in Washington that the board must contain three members of the political party in power and two members of the party out of power – members serve staggered five-year terms. By definition, the arrival of the Obama administration in 2009 meant that the then-short-handed board, once back at full strength, would consist of three Democrats and two Republicans. As Democratic members usually favor unions and often come from a union background, unions gained the advantage. Second, the Democrats named by Obama to the board were more ideological than Democrats of prior administrations. Craig Becker, for example, who served 21 months on the board and had been an associate counsel for the Service Employees International Union and the AFL-CIO prior to coming aboard, previously had expressed the view that an employer should not have the right to challenge union behavior, however coercive, during an organizing drive. He since has served as AFL-CIO general counsel.

The Trump era means that the National Labor Relations Board, once at full strength, will have a 3-to-2 Republican majority. And as the NLRB currently operates with only three members – two Democrats (Mark Gaston Pearce and Lauren McFerran) and one Republican (Chairman Philip Miscimarra) – both open seats will go to Republicans. Last month, President Trump announced his choices: Marvin Kaplan and William Emanuel. Kaplan, nominated on June 20, is chief counsel of the Occupational Safety and Health Review Commission, an independent agency that hears appeals of citations and penalties imposed by the Occupational Safety and Health Administration (OSHA). He previously had been a Republican staffer for the House Oversight and Government Reform Committee and the House Education and the Workforce Committee. Emanuel, nominated on June 27, is a shareholder partner in the Los Angeles office of the San Francisco-based employer law firm of Littler Mendelson. He has extensive experience representing clients at NLRB hearings.

While Senate approval shouldn’t be assumed, the prospects look good for each nominee, especially with 52 senators in the Republican column. Lamar Alexander, R-Tenn., who chairs the Senate Committee on Health, Education, Labor and Pensions, made this statement following the Kaplan nomination: “Marvin Kaplan has the qualifications to be an effective member of the National Labor Relations Board.” If he and Emanuel are approved, the full five-members board will have to deal with a number of recurring issues on which unions recently have prevailed, and with questionable justification. Here are the most pressing ones.

Joint employer status. The National Labor Relations Board in August 2015 dramatically expanded the basis for forcing an employer to bargain alongside a subsidiary or contractor company in ruling for a Teamsters local in Browning-Ferris Industries of California, Inc. Up until that point, the board had adhered to a “direct and immediate control” test for determining joint employer status. The new standard includes situations in which “indirect” and/or “potential” control can originate from the top. The fast food industry, where franchisees and not headquarters hire, promote and set wages, is especially likely to be affected. An ongoing case involving the McDonald’s chain soon will hit the board docket. NLRB General Counsel Richard Griffin in December 2014 had authorized six regional directors to force the restaurant chain, along with a number of its franchisees, to assume liability for alleged unlawful interference with and discrimination against certain employees who participated in nationwide protests. Last October, Administrative Law Judge Lauren Esposito approved an agreement between McDonald’s and Griffin to sever certain active cases in New York and Philadelphia from dozens of other unfair labor practice cases; in turn, the NLRB would rule directly on the New York and Philadelphia cases. In November, the NLRB ruled 2-1 that McDonald’s must turn over information subpoenaed by Griffin’s office.

Micro-Unionism. Labor unions, if perceiving themselves as lacking support to win a representation election at a given worksite, increasingly are organizing relatively small fraction of its workers. The NLRB’s August 2011 decision in Specialty Healthcare provided a green light for this trend, known as “micro” unionism. The ruling has created the basis for the formation of collective bargaining units at such employers as Bergdorf Goodman, Macy’s, T-Mobile and Volkswagen that represent only a small portion of all employees. Micro-bargaining might seem like a benign term, but in practice it is not. It undermines the integrity of collective bargaining, inhibits employee mobility within an enterprise and makes it easier to coerce unwilling employees to join even if overall workplace support for union representation is weak. Sen. Johnny Isakson, R-Ga., and Rep. Francis Rooney, R-Fla., in late May introduced a bill, the Representation Fairness Restoration Act (S. 1217, H.R. 2629), to end this practice. If Congress doesn’t pass the legislation by the end of next year, the NLRB almost certainly will (and should) reconsider Specialty Healthcare.

Employee Handbooks. It is the prerogative of employers to distribute handbooks to new employees explaining workplace rules so long as the rules do not interfere with the right of employees to engage in “concerted activity” for “mutual aid or protection,” as defined by NLRA Section 7. NLRB General Counsel Griffin and Democratic board members during the Obama era interpreted this right as a license to sue employers for unfair labor practices based on completely innocuous and commonsense handbook clauses. The NLRB’s 2004 ruling in Lutheran Heritage Village was the catalyst for this legal abuse. Yes, this decision predated the Obama administration. At the same time, it empowered the board during the Obama years to impose bizarre handbook-related restrictions on employers. If Kaplan and Emanuel are approved, the board likely will interpret Section 7 in a less reckless way.

Ambush Elections. In February 2014, the National Labor Relations Board reissued a regulation that would reduce the allowable time frame for an employer to express opposition to union representation during an election campaign from 42 days to as few as 10 days. This “quickie” or “ambush” election rule, which took effect in April 2015, has played greatly to the advantage of unions. Employers, and dissenting employees, now have less time than ever to explain their side during a campaign.  This rule most of all has adversely affected small businesses, which typically cannot afford to hire a full-time labor issues counsel. Since the rule was promulgated, the average period for filing a petition and holding an election has fallen from 33 to 23 days.

One cannot overestimate the role of NLRB General Counsel Richard Griffin in much of this. Since the start of his four-year term, Griffin has exerted tremendous leverage in defining the range of issues before the board. He also frequently has exercised his authority to target employers for subpoenas and lawsuits. A board member during January 2012-August 2013 before assuming his current position in November 2013, Griffin for years had been the house lawyer for the International Union of Operating Engineers. He is a longtime union man. Whatever he says about the importance of a “level playing field” in workplace relations, he does not operate that way in practice. All too often, his convictions have made their way into board rulings. Trump supporters might be buoyed by the fact that Griffin’s term expires this November. However, in light of a U.S. Supreme Court ruling this March regarding his predecessor, Acting General Counsel Lafe Solomon, President Trump might have to wait a good while before replacing him.

Everyone who has been in Washington for more than a couple years knows to treat the term “nonpartisan” with a nudge and a wink. Everything in Washington is partisan. It is a question of how well one cloaks partisanship. The National Labor Relations Board is no exception. Its members bring strong sympathies to the table. The customary 3-2 majority favoring the party in the White House exists to prevent a situation in which the “union” or the “management” faction feels grossly outnumbered. This maximizes the possibility of resolving a difficult issue with one swing vote. Even more importantly, board members must adhere to NLRA statutes in rendering judgments. President Obama’s appointees to the board tended to be partisan toward unions in ways aggressively exceeding congressional intent. President Trump’s two nominees to the NLRB, Marvin Kaplan and William Emanuel, by contrast, seem more interested in interpreting law than making it. Each is highly capable and possessed of a firm grasp of complex labor issues. If they wind up curtailing recent board excesses, American workers as a whole would benefit.

Postscript: On August 2, the full Senate approved the nomination of Marvin Kaplan in a party-line 50-48 vote. On September 25, the Senate approved William Emanuel by 49-47.