National Labor Relations Act: Case Notes from Recent Decisions

I. INTRODUCTION

In 1935, Congress passed the National Labor Relations Act (29 U.S.C. §§ 151-169) (NLRA or Act), making clear that it is the policy of the United States to encourage collective bargaining by protecting workers’ full freedom of association. The NLRA protects workplace democracy by providing employees at private-sector workplaces the fundamental right to seek better working conditions and designation of representation without fear of retaliation. The NLRA protects most employees whether the workplace is unionized or non-unionized. The Act is enforced by the National Labor Relations Board (NLRB or Board).

The following are recent decisions of the NLRB.

II. SEASONAL EMPLOYEES OF A FIRST-YEAR EMPLOYER ELIGIBLE TO VOTE IN NLRB ELECTIONS WITHOUT PROOF OF OFFER OF SECOND-YEAR REEMPLOYMENT

Pier 55, Inc., d/b/a Little Island, 371 N.L.R.B. 80 (2022)

In a 2-1 vote, an NLRB panel denied review of a Regional Director’s Decision and Direction of Election for a unit of seasonal employees. The petition was filed during the employer’s first year of operation, and as a result, no offers of seasonal reemployment for the second year had been extended. The Board majority found that the record still demonstrated that the seasonal employees had a reasonable expectation of reemployment and were eligible to vote.

Pier 55 (Employer) operates a public park with an amphitheater in New York City that first opened in May 2021. The 20-year lease required the Employer to organize at least 21 artistic events each year. The Employer employed some year-round employees but also employed certain employees solely during the summer performance season. Offer letters for stage technicians specified that employment was temporary and would terminate on October 1, 2021. Stage technicians were told, though, that the Employer would benefit from hiring technicians who were available to return in future seasons, and the handbook provided that seasonal employees were expected to confirm interest in returning for future seasons.

Theatrical Protective Union, Local No. One (Union) petitioned to represent the stage technicians and stagehands employed by the Employer on June 14, 2021. Because the park was only recently opened to the public, the Employer had not made concrete plans for future performances in future seasons. The Employer argued that the petition should be dismissed because the unit consisted entirely of short-term employees with no reasonable expectation of continued employment or reemployment.

The Regional Director found that the petitioned-for unit was appropriate and that the employees were seasonal with a reasonable expectation of reemployment. Under Maine Apple Growers, 254 N.L.R.B. 502 (1981), when deciding whether seasonal employees are eligible to vote, the NLRB looks to the size of the area labor force, the extent of employer reliance on seasonal labor, actual reemployment season-to-season, and the employer’s recall preference for prior seasonal employees. The Regional Director relied on the narrow labor pool of available stagehands, the Employer’s reliance on seasonal labor and lack of concrete plans to cease using season labor in later years, and the Employer’s comments during interviews and in its handbook creating preference for stagehands who would return in future years. Although the recent opening of the park meant that there was no way to determine the actual reemployment season to season, the Regional Director found the unit appropriate.

A majority of a three-member Board panel denied review of the Decision and Direction of Election. Chairman McFerran and Member Wilcox agreed with the Regional Director’s analysis under Maine Apple Growers, finding that the stage technicians were eligible to vote as seasonal employees with a reasonable expectation of future employment. They found that, despite this being the Employer’s first year with no evidence of actual reemployment year-to-year, the record was sufficient to establish employees were seasonal. The Employer’s conduct demonstrated that it encouraged stage technicians to reapply in future years, the lease required the Employer to organize performances each year, and the timing of the petition filed in June 2021 explained why no 2022 seasonal employees had been hired. Finally, the majority noted that requiring multiple years of operation before seasonal employees could join a union would prevent seasonal employees from exercising their rights under the National Labor Relations Act (NLRA or Act).

Dissenting, Member Ring would grant review to determine whether a reasonable expectation of reemployment was present. He would find that extant precedent requires actual reemployment of employees from one season to another, regardless of whether an employer was in its first year of operation. Further, Member Ring would find that the Regional Director inappropriately placed the burden on the Employer to establish that the unit was inappropriate.

III. WITHDRAW OF RECOGNITION FOUND UNLAWFUL DUE TO EXTENDED CERTIFICATION YEAR

J.G. Kern Enterprises, Inc., 371 N.L.R.B. 91 (2022)

In a 2-1 decision, an NLRB panel held that an employer’s bargaining unfair labor practices (ULP) extended the certification year. The panel simultaneously found that the employer’s withdrawal of recognition during that extended period was unlawful.

J.G Kern Enterprises, Inc. (Employer) is engaged in the manufacture and sale of automotive parts. On October 3, 2018, Local 228, International Union, United Automobile, Aerospace and Agricultural Implement Workers of America (UAW), AFL–CIO (Union) was certified as the exclusive representative of a unit of the Employer’s employees. The Union requested bargaining on October 15, 2018, but the Employer delayed bargaining until January 10, 2019. To assist in drafting a proposal for a union-administered benefit plan, the Union requested information regarding the Employer’s costs in providing health insurance to employees. The Employer declined to produce the information and stated that there was no need for the Union’s proposal because the Employer was going to maintain its current plan. On November 25, 2019, roughly 14 months after certification and before a collective bargaining agreement was reached, the Employer withdrew recognition of the Union based on a disaffection petition.

The Administrative Law Judge (ALJ) found that the Employer violated section 8(a)(5) and (1) of the Act by delaying bargaining for almost three months, refusing to furnish information related to benefit plan costs, and notifying the Union that it would not consider proposals for union-administered benefit plans. Applying Master Slack Corp., 271 N.L.R.B. 78 (1984), the ALJ reasoned that the disaffection petition was tainted by these unfair labor practices, thereby making the withdrawal of recognition unlawful.

A majority of the Board panel adopted the ALJ’s conclusions. In agreeing that the Employer unlawfully withdrew recognition, the NLRB relied on an alternative theory raised by the General Counsel. The majority found that the withdrawal was unlawful because it occurred during an extended certification year when the Union’s presumption of majority status is irrebuttable—regardless of whether the Union maintained majority support or whether the disaffection was caused by the Employer’s unfair labor practices. Under normal circumstances, a union enjoys a conclusive presumption of majority status, which prevents decertification petition or withdrawal of recognition for one year after certification. However, when an employer’s unlawful conduct during the certification year deprives the union of twelve months of good faith bargaining, the certification year is extended to remedy the unfair labor practices. Relying on Whisper Soft Mills, Inc., 267 N.L.R.B. 813 (1983), the Board found that the Employer’s other unfair labor practices extended the certification year. Because the withdrawal of recognition occurred during this extended certification year period, the withdrawal was unlawful.

Dissenting, Member Ring would apply Master Slack. Because this case simultaneously dealt with the propriety of the withdrawal of recognition and the underlying failure to bargain charges, the Employer was not on notice that withdrawal would be premature and the application of the “obscure” Whisper Soft Mills theory was inappropriate. Contrary to the ALJ, Member Ring would find that the disaffection petition was not tainted by the Employer’s conduct and that the withdrawal was lawful.

IV. RERUN ELECTION NOT WARRANTED WITHOUT EVIDENCE THAT BOARD AGENT’S COMMUNICATION CREATED PREJUDICIAL HARM

GHG Management LLC d/b/a Windy City Cannabis, 371 N.L.R.B. 93 (2022)

In a 2-1 decision, the NLRB found that a Board agent’s statement implying that all known ballots had been received—while the Region was aware that one expected ballot had not been received—was not sufficient to warrant a rerun election.

GHG Management (Employer) and United Food and Commercial Workers Local 881 (Union) entered into a stipulated election agreement. The agreement called for mail ballots to be sent on February 25, 2021, due by March 19, and counted on March 22. But on March 19, the Acting Regional Director approved the parties’ request to extend the voting period to March 29 and hold the ballot count on March 31 due to concerns that not all mailed ballots had been received by the Region. On March 22, a Board agent informed the parties that the Region had received the ballots “it had been expecting . . . from all at least that have told me that they sent their ballots in.” On March 31, the ballot count showed an 11-10 vote in favor of representation. On April 1, the Region received a ballot from a voter that had previously informed the Region that the ballot would be mailed in mid-March.

As part of its objections to the election, the Employer argued that the Region represented on March 22, 2021, that it had received ballots from all voters who had indicated an intent to mail a ballot, but it had not yet received the outstanding ballot at issue which resulted in “disenfranchisement that is outcome determinative.” Applying Guardsmark, LLC, 363 N.L.R.B. 931 (2016) and overruling the objection, the Acting Regional Director found that there was no “reasonable doubt as to the fairness and validity of the election” because the Employer did not provide evidence of actual prejudice to establish that a new election was required.

The Board granted review on this one objection and adopted the Acting Regional Director’s decision to overrule the objection. The Board found that whether the Employer was deprived of the opportunity to seek a second extension of the ballot count was irrelevant to whether the voting itself was valid. No voters were aware of the Region’s communication and the ballot at issue was mailed to the Region prior to the communication. Further, the effect of the Region’s communication was speculative as it was unclear whether the Employer would have sought a second extension, whether the Union would have agreed, and whether the Acting Regional Director would have granted the extension.

Dissenting, Member Kaplan would find that the conduct here raised “insurmountable concerns” about the election, particularly where the outcome turned on a single vote and the parties had previously extended the ballot count out of concern for outstanding ballots.

Jeffrey S. Bosley is a partner in the Labor and Employment Department of Davis Wright Tremaine LLP, and represents employers and management in labor and employment law matters. He can be reached by email at jeffbosley@dwt.com.

Tyler Maffia is an associate in the San Francisco office of Davis Wright Tremaine LLP who assists employers in labor and employment law matters. He can be reached at tylermaffia@dwt.com.