Increased NLRB Activity Causes Controversy

By HunterMaclean Attorneys

Published in Business in Savannah

The National Labor Relations Board (NLRB) has stepped up its scrutiny and oversight of alleged National Labor Relations Act (NLRA) violators, causing unrest among business leaders who oppose and fear an increasingly active NLRB. The five-member board is working to adopt a more pro-union perspective on the heels of the relatively pro-employer era of President Bush through increased enforcement and new rules.

The NLRA covers most private employers that meet certain minimum standards for involvement in interstate commerce. Retail or service employers are generally covered if they have gross sales of more than $500,000. Other employers (including manufacturers) are generally covered if they have an “inflow” or “outflow” of $50,000 or more to or from other states. The NLRA does not cover public employers and certain employers in the transportation industry.

A much-publicized indicator of the NLRB’s stepped-up enforcement can be seen in the recent conflict over Boeing’s 4,000 employee factory in North Charleston, built to manufacture the airline company’s new 787 Dreamliner jet. The NLRB alleges Boeing retaliated against unionized employees in Washington state by opening the plant in right-to-work South Carolina instead of more union-friendly Washington.

Courts have wrestled with “runaway shops” before; the legal rules and restrictions are not new. Generally, whether a violation has occurred depends on the employer’s motivation in deciding to create new jobs in a new location rather than maintaining its geographic employment structure before the move. Courts compare a business’s legitimate economic reasons for the move with any evidence of unlawful discriminatory motives to determine if a NLRA violation has occurred.

The NLRB is also showing its more aggressive posture in the formulation of a controversial new workplace notice rule. This new rule will require all covered employers to post a notice informing employees of their rights under the NLRA; that is, to organize a union, to bargain collectively with an employer, to strike or picket, etc. The notice further includes certain things that neither an employer nor a union may do under the NLRA. The notice, measuring 11 x 17 inches in size, is similar to the Department of Labor notices already posted in work places across the country and provided free of charge by the government. A covered employer that fails to post the notice will be exposed to accusations that it interfered with, restrained or coerced employees in the exercise of their NLRA rights.

Many businesses expressed their immediate outrage at the new rule, claiming the mandate is outside of NLRB authority and an assault on business owners. Since the NLRB first made the announcement in December 2010, more than 7,000 comments on the proposed regulation were received during the six-month comment period and several law suits were filed challenging the NLRB’s authority to enact the rule. NLRB officials maintain that the posters are long overdue and are meant only to educate the American workforce about their rights.
Originally set to be enforced on November 14, 2011, the mandate has since been postponed until January 31, 2012. In announcing the delay, the NLRB noted that the postponement was necessary “in order to allow for enhanced education and outreach to employers, particularly those who operate small and medium size businesses.”

Employers should pay attention to the outcome of these two examples of increased NLRB activity and respond accordingly. They should also take steps to educate themselves generally about the NLRA, as the NLRB continues to flex its muscle.