Banning union-related speech, freezing benefits programs during campaign violate NLRA
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Tuesday, August 8, 2017

Banning union-related speech, freezing benefits programs during campaign violate NLRA

By Kathleen Kapusta, J.D.

When, during a union campaign, an employer banned all union-related speech on the plant floor and froze two longstanding employee wage benefit programs, the employer violated the NLRA, agreed the D.C. Circuit, also finding the employer’s challenge to the Board’s make-whole remedy was without merit. Nor did the Board err when, in sustaining union challenges to two ballots, it found that the employees qualified as “professional employees” and therefore their ballots should not be counted. The court denied the employer’s petitions for review and granted the NLRB’s applications for enforcement (Oberthur Technologies of America Corp. v. NLRB, August 4, 2017, Garland, M.).

After the union commenced an organizing campaign at the employer’s plant, the employer banned all union-related speech on the plant floor and froze spot bonus wage increase programs, prompting the union to file unfair labor practice charges against it. Several months later, the union filed a petition with the Board seeking a representation election and the parties reached a Stipulated Election Agreement, which provided for a secret-ballot election and defined the relevant bargaining unit as covering all full-time employees working in 15 specified departments.

Election. The election was held and the employer did not challenge any ballots or contest the election’s validity. Two ballots cast by engineers and challenged by the union, however, were impounded and the union prevailed by a two-vote margin.

ALJ and Board decisions. The unfair labor practice charges and challenges to the election were consolidated and the Board, adopting the findings of an ALJ, concluded that the employer violated the NLRA by unlawfully restricting union-related speech and by announcing and enacting the wage benefits freeze. It directed the employer to rescind its speech restriction and make its employees whole for any losses stemming from the freeze. It also adopted the ALJ’s recommendation to sustain the union’s challenges to the ballots and rejected as untimely and procedurally improper the employer’s alternative challenge to the validity of the election, certifying the union as the exclusive collective-bargaining representative for the stipulated unit. The employer subsequently refused to bargain with the union, which the Board also found to violate the NLRA.

Employee speech. Addressing on appeal the employer’s objection to the finding that it unlawfully restricted employee speech, the court noted statements by a shift supervisor who told employees “that discussions about the union or organizing had to take place in common areas, not work areas.” The company conceded that it did not impose similar restrictions on nonunion subjects and it did not show that it had a legitimate and substantial business justification for the rule. Observing that the mere maintenance of a rule likely to chill Section 7 activity can amount to an unfair labor practice even absent evidence of enforcement by the employer, the court found substantial evidence to support the Board’s conclusion that the company’s statement had a reasonable tendency to coerce or interfere with its employees’ Section 7 right to communicate about the union, thereby violating the NLRA.

Freeze. Substantial evidence also supported the Board’s finding the employer violated the Act by freezing wage benefits it had granted to its employees through a spot bonus program and a wage increase program. Two days after the union filed its election petition, the company’s HR manager sent an email to other managers and supervisor informing them of the freeze, stating that “During this period, we have to keep the status quo on all issues related to wages, transfers, and promotions. . . . Hopefully, with the phrase, ‘during this period,’ employees will realize that it may be linked to unions, but we cannot draw that conclusion for them.”

Although the employer argued that the discretionary nature of the two programs made the freeze necessary, the court noted evidence that the employer had already approved bonuses and scheduled wage increases for several employees prior to the freeze. Moreover, the NLRB’s remedy applied only to an employee whose approved bonus or scheduled wage increase was delayed because of the freeze. And while an employer may postpone an expected wage or benefits increase so long as it makes certain things clear to employees, here the record showed that the employer did not communicate to its employees that the sole purpose of the freeze was to avoid the appearance of influence and that the benefits would be reinstated no matter the outcome of the election. To the contrary, said the court, the HR manager’s email indicated that the company hoped to leave employees with the impression the freeze was “linked to unions” and that their promotions would be processed “once we vote the union down.”

As to the employer’s challenge to the Board’s remedy, the court pointed out that the Board’s order made clear that “the identification of employees unlawfully denied spot bonuses and the determination of the amount they should receive, including interest” would be determined at the compliance stage. Noting that it has consistently declined to consider challenges to remedial orders when the Board has reserved the issue for later consideration, the court found no reason to depart from that practice.

Ballot objections. Turning to the Board’s disposition of the election, the court pointed out that NLRA Section 9(b)(1) bars the Board from certifying any bargaining unit that includes both professional and nonprofessional employees unless a majority of the professional employees vote for inclusion in the unit. When a mixed unit is contemplated, the Board requires the use of special ballots that ask professional employees both whether they wish to be included in a unit with nonprofessionals and whether they wish to be represented by the union. This is known as a “Sonotone election.”

Here, the court observed, although the Agreement neither expressly included nor expressly excluded professional employees, it specifically set forth “non-Sonotone” language to be used on all ballots. Accordingly, the Regional Director administered a conventional, non-Sonotone election and the employer raised no timely objections. The union, however, did timely object to the ballots cast by the two engineers and the Board found they were professional employees. While the employer argued that the Board and ALJ applied “a one-size-fits-all approach” to its determination that they were professionals, the court found that the ALJ specifically addressed distinct features of the work each engineer performed, finding among other things that neither performed “routine or standardized” work, since they had to make “independent use of the skills and advanced knowledge” they “acquired through their engineering education and work histories.” Further, substantial evidence showed they performed work that drew upon specialized technical or professional knowledge and required them to lead cooperative efforts and that both were salaried and had academic degrees.

As to the employer’s contention that the election certification was nonetheless invalid because the two engineers were never issued Sonotone ballots, the court found this was not timely raised before the Board and thus the Board properly declined to consider it.

Finally, said the court, because the certification was valid, the employer’s refusal to bargain and provide the requested information violated the NLRA.

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