Arthur F. Silbergeld
Employment Law Partner, Thompson Coburn LLP
Labor & Employment
Phone: (310) 282-2529
Email: asilbergeld@thompsoncoburn.com
Temple Univ Law School
Arthur is based in Los Angeles and is in the firm's Labor & Employment Practice Group.
Aya Z. Elalami
Associate, Thompson Coburn LLP
10100 Santa Monica Boulevard, Suite 500
Los Angeles , CA 90067
Many non-union employers fear unionization of their non-exempt employees and provide training to supervisors on union organizing tactics and union avoidance. However, less attention is paid to National Labor Relations Board (NLRB) rulings that impact company rules, policies, and decisions affecting employees which may lead to unfair labor practice charges and encourage organizing.
Over the course of the last year, there have been significant developments in NLRB holdings that impact non-union employers. For example, a recent NLRB decision created a new mandatory union recognition rule which would bypass the need for a NLRB-conducted election. Under Cemex Construction Materials Pacific, LLC, 372 NLRB No. 130 (2023), a union requesting recognition simply needs to make a demand on the employer claiming that a majority of employees support such recognition. Although Cemex Construction Materials Pacific, LLC discusses the methods by which a union can demonstrate majority support when demanding recognition, such as signed authorization cards, there is nothing in the new Cemex rules that requires the use of any specific method to establish majority support. Therefore, when an employer receives a union request for recognition supported by a showing of majority support, the employer must either: (1) immediately grant union recognition without an election, or (2) promptly petition the NLRB for an election. An employer faced with a demand for union recognition must immediately communicate with the Board and be careful not to commit any unfair labor practices that could result in the Board ordering the employer to recognize and bargain with the union without an election.
There have also been significant changes to non-compete agreements and non-disparagement restrictions that non-union employers often insert in offer letters and handbooks. In February 2023, the NLRB ruled that employers cannot offer employees (whether union members or not) severance agreements that contain confidentiality and non-disparagement restrictions. In McLaren Macomb, 372 NLRB No. 58 (2023), the NLRB found it was unlawful for an employer to offer severance agreements that prohibited employees from making statements that could disparage the employer and from disclosing the terms of the severance agreement itself. This reversed a 2020 decision, Baylor University Medical Center and IGT d/b/a International Game Technology 369. NLRB No. 43 (2020), which permitted such a provision in a severance agreement. In May 2023, Jennifer Abruzzo, General Counsel of NLRB, declared war on non-compete provisions by issuing Memorandum GC-23-08, which claimed employers who require non-compete agreements violate the National Labor Relations Act (NLRA).
The NLRB’s 2023 decision in Atlanta Opera, 372 NLRB No. 95 (2023) (“Atlanta Opera”) returned the independent contractor standard to its prior test under Fedex Home Delivery, 361 NLRB 610 (2014). Under the Atlanta Opera standard, the NLRB will evaluate independent contractor status by considering all aspects of the worker-business relationship in light of common-law agency principles, with no one factor being outcome determinative, and evidence of entrepreneurial opportunity. In Atlanta Opera, the NLRB found that the Opera’s hair and makeup stylists were covered employees entitled to the protections of the NLRA. This decision raises a question as to whether hundreds of thousands of workers classified as independent contractors, such as ride-share and delivery workers, are also entitled to union rights under federal labor law. The NLRB has yet to answer this question.
Two other NLRB decisions impact the labor rights of non-unionized workers. The decision in Miller Plastic Products, Inc. and Ronald Vincer, 372 NLRB No. 134 (2023) expanded the definition of “concerted activity” under the NLRA to potentially include a single worker’s actions. The prior standard, under Alstate Maintenance, LLC, 367 N.L.R.B. No. 68 (2019), served to substantially narrow the situations in which statements made by individual employees in front of their coworkers will be found concerted. Historically, Board decisions held that “concerted activity” had to more inclusively be supported by other workers. Another decision, American Federation for Children, Inc. 372 NLRB No. 137 (2023), found that anti-retaliation protections apply to employees who protest the company’s treatment of non-employees, including unpaid interns.
Section 7 of the NLRA guarantees employees the right of self-organization, to form and join unions, to bargain collectively, and to engage in other ‘concerted’ activities. Historically, the NLRB has interpreted “concerted activities” to mean discussing wages with co-workers, a concerted refusal to work, protesting with others about safety, work schedules, seeking more holidays, and going with fellow employees to talk to the boss. Acting on one’s own or solely on one’s own behalf have typically not been construed as acting in concert, but the thread to finding activity concerted recently thinned.
One recent ruling illustrates the heightened standard when an employer sought to impose disciplinary action against an employee while otherwise engaged in Section 7 activities. The decision makes it more difficult for an employer to terminate or discipline an employee for violating rules of conduct by using offensive, profane, and disrespectful language while engaging in such protected activity. In Lion Elastomers, 372 NLRB No. 83 (2023), the Board determined that various setting-specific standards must be analyzed and considered when determining whether a relevant disciplinary action is a violation of Section 7 of NLRA. The decision suggests, for example, that using profane language in talking about one’s employer on social media, when making complaints about working conditions in concert with co-workers, or during a union organizing drive could be protected. An employer taking disciplinary action in these and many other circumstances may be violating the NLRA. Therefore, employers must know both when activity is covered by Section 7 and when it is “concerted” before disciplining or firing an employee whose language or behavior clearly violates company rules.
In another case, Starbucks Corp. d/b/a Starbucks Coffee Co. & Philadelphia Baristas United & Echo Nowakowska & Tristan J. Bussiere, 372 NLRB No. 102 (2023), the NLRB ruled that two non-union employees were not barred from the full remedy of reinstatement and backpay, even though they secretly recorded conversations they had with their supervisors prior to their discharges in purported violation of the employer’s no-recording policy and Pennsylvania state law. The Board found that the individuals recorded those conversations to defend themselves against retaliation for their protected activities, and that their recording activity was protected under Section 7 and that the state law banning recording without the consent of both parties was preempted.
The NLRB recently made it more difficult for property owners to exclude contractor employees who engage in protected conduct on their property. In Bexar County Performing Arts Center Foundation d/b/a Tobin Center for the Performing Arts and Local 23, American Federation of Musicians, 372 NLRB No. 28 (2022) (Bexar County II), the Board found that property owners may not deny off-duty contract workers access to the property for the purpose of engaging in activities protected under Section 7 of the NLRA unless the workers’ Section 7 activities “significantly interfere” with the property’s use or where the owner has “another legitimate business reason” to eject them.
The NLRB has played a significant role in shaping the landscape of labor relations, particularly with its decisions that extend beyond the traditional boundaries of unionized workplaces. Non-union employers are finding themselves increasingly affected by these rulings, and non-union employers should stay informed about NLRB rulings and proactively adjust their policies and practices to align with such decisions.
Non-union employers should pay close attention to and follow Board decisions affecting their workforces. The Board consists of five members, two from one political party, and three from the other. As individual members’ terms expire and new members are appointed by the President, the political composition of the Board changes as does the collective view of past decisions. Old rules that might be more favorable to employers or employees are sometimes tossed aside as the views of the majority on the Board tend to favor employers or employees. Adhering to recent rulings will protect employers from policies, practices, and decisions that potentially violate the NLRA.