Labor & Employment Law Daily NLRB: Employer lawfully denied access to nonemployee union agents, even as it allowed access to other nonemployees
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Wednesday, September 11, 2019

NLRB: Employer lawfully denied access to nonemployee union agents, even as it allowed access to other nonemployees

By Ronald Miller, J.D.

An employer may deny access to nonemployees seeking to engage in protest activities on its property while allowing nonemployee access for a wide variety of charitable, civic, and commercial activities that are not similar in nature to the protest activities.

In the latest of several recent decisions reaffirming employer property rights, the NLRB held, in a divided four-member ruling, that nonemployee union agents who sought access to an employer’s property for the purpose of soliciting its customers to boycott its store were permissibly ejected from the property. Setting a new legal standard, the Board held that to establish that a denial of access to nonemployee union agents violates the NLRA under the U.S. Supreme Court’s 1956 ruling in NLRB v. Babcock & Wilcox, Inc. discrimination exception, the General Counsel must prove that an employer denied access to nonemployee union agents while allowing access to other nonemployees for activities similar in nature to those in which the union agents sought to engage. Member McFerran filed a dissenting opinion (Kroger Limited Partnerships I Mid-Atlantic, September 6, 2019).

The employer operates a grocery store located in a multi-tenant retail shopping center which it leases. The leased premises included a sidewalk in front of the store and an enclosed foyer at the customer entrance. The employer shares the shopping center parking lot with its co-tenants. Further, the landlord vested the employer with a sufficient property interest and the authority to enforce the lease agreement’s “no-solicitation/no-loitering” rule.

On March 25, 2014, the landlord sent the employer a letter expressing its concern with “continuous and smooth operation of the shopping center” and the prevention of “disruptive activities or nuisances that have a potentially adverse impact on our tenants and their customers, the shopping center, and the community at large.”

Access requests. Although the employer did not maintain any written policies governing the handling of requests from outside organizations to access its property, the store’s unofficial policy and practice was to forward requests to solicit to the store manager, who approved some groups but denied the requests of other groups. The evidence established that the employer allowed some groups to pass out literature or sell goods on the sidewalk area, including the Girl Scouts and Salvation Army. Further, the American Red Cross was permitted to run its mobile blood drive in the parking lot. The employer also has denied access to church groups to engage in solicitation.

The union has represented a unit of employees at the store since March 28, 2010. The parties entered a collective bargaining agreement that was effective August 3, 2014, through August 4, 2018. In late 2014, the employer opened two new grocery stores in the area. The employees at those stores were not represented by a union. After the new stores were opened, the employer began the process of closing other stores, including at the present location.

Limited transfer opportunities. As part of the closing process, the employer met with its employees and their union representative. It offered employees the opportunity to transfer to other stores. However, the employer refused to offer transfer to the nearby, newly opened stores. Rather, it offered reassignment to unionized stores. The union contended that the employer should also offer the employees the ability to transfer to the new stores.

Soliciting customers for boycott. On April 2, a nonemployee union representative began soliciting customers in the parking lot in front of the store to sign petitions protesting the employer’s decision to transfer store employees to stores outside of the area. The employer’s store manager confronted the union representatives, and told them they were not authorized to solicit on the employer’s premises and to leave the property. However, the representatives continued to solicit until police officers asked them to leave the premises.

The union filed a complaint alleging that the employer violated Section 8(a)(1) by prohibiting nonemployee union representatives from soliciting its customers to sign a petition. An administrative law judge found that the union was engaged in NLRA-protected activity. Further, applying the Board’s 1999 decision in Sandusky Mall Co., the ALJ found that the employer discriminated against the union within the meaning of Babcock by permitting a variety of charitable and civic organizations to fund-raise on its property while ejecting the nonemployee union representatives who entered its property to solicit customers to boycott the store.

“Similar in nature” standard.Sandusky Mall improperly stretched the concept of discrimination beyond its accepted manner, the majority found. Courts have consistently limited the Babcock discrimination exception to situations where an employer ejects nonemployee union agents seeking to engage in activities similar in nature to activities the employer permitted other nonemployees to engage in on its property. Observing that Sandusky Mall and its progeny have been roundly rejected by the courts of appeal, the Board overruled the decision, and similar cases.

Protest and boycotts activities are not sufficiently similar in nature to charitable, civic, and commercial activities to warrant a finding of discrimination based on disparate treatment of such conduct. The Board will permit an employer to ban nonemployee access for union organizational activities if it also bans comparable organizational activities by non-labor groups, such as membership drives by fraternal societies and religious organizations.

Moreover, in a footnote, the Board explained that the “similar in nature” standard encompassed more than the literal activity engaged in; it also includes the purpose of the activity. For example, distributing handbills near a grocery store entrance to advertise a food drive for a food bank and distributing handbills to appeal to shoppers to boycott the store are not similar in nature because the purposes behind the two distributions are radically different.

Because the General Counsel had not shown that the employer had ever permitted any nonemployees, whether affiliated with a union or not, to engage in protest activities on its premises comparable to the boycott solicitation at issue in this case, the Board reversed the decision of an ALJ and dismissed the unfair labor practice complaint.

Retroactive application of revised standard. The Board will apply its new standard retroactively. The Board will apply a new rule “to the parties in the case in which the new rule is announced and in other cases pending at the time so long as retroactivity does not work a ‘manifest injustice.’” After consideration of whether retroactive application will work a manifest injustice, the reliance of the parties on preexisting law, the effect of retroactivity on accomplishment of the purposes of the Act, and any particular injustice arising from retroactive application, the Board found that application of the new standard would not result in any manifest injustice.

Dissent. Member McFerran pointed out that the ALJ found that the employer violated the Act by adopting and then implementing a no-solicitation policy directly in response to union activity. That explicit motive-based determination easily supported finding a violation here, making it unnecessary to reach the disparate treatment issue, McFerran wrote. Moreover, she noted that the majority again reversed precedent on a major labor-law issue without providing notice to the public or inviting briefs. According to McFerran, the majority’s decision fundamentally changes the approach set forth in the Supreme Court’s 1949 decision in NLRB v. Stowe Spinning Co. and contradicts that decision. In McFerran’s view, the ruling here also misconstrues the meaning of discrimination within the framework of Section 8(a)(1).

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