Employment Law Daily NLRB ruling protecting employee testimony before state legislative committee misapplied test
Tuesday, April 17, 2018

NLRB ruling protecting employee testimony before state legislative committee misapplied test

By Ronald Miller, J.D.

Finding the NLRB’s reasoning that an employee was afforded protection for disparaging appeals to third parties was not supported by substantial evidence, the D.C. Circuit granted an employer’s petition for review in part and remanded the matter to the Board to make clear its principles for affording protection to such employees. Here, the appeals court determined that the NLRB’s decision essentially skipped discussion of the first requirement for application of the Jefferson Standard test (Oncor Electric Delivery Co. LLC v. NLRB, April 13, 2018, Williams, S.).

The NLRA protects the right of employees to engage in concerted protected activities, including, in some circumstances, employee appeals to third parties standing “outside the immediate employee-employer relationship.” However, in Jefferson Standard, the Supreme Court recognized that the Act does not bar dismissal for “cause,” and that there is no more elemental cause for discharge than disloyalty to the employer. Read in light of Jefferson Standard, the D.C. Circuit has formulated a two-prong test for assessing whether employees’ third-party appeals constitute protected concerted activity or instead amount to “such detrimental disloyalty” as to permit the employee’s termination for cause.

In this instance, the employer petitioned for review of the Board’s decision that it engaged in unfair labor practices by discharging the employee for making false or disparaging statements during two minutes of testimony before a Texas senate committee. According to the employer, the Board misapplied the Jefferson Standard test.

Committee testimony. The main dispute in this case arose out of an October 2012 hearing before a Texas senate committee that was studying whether smart electric meters have harmful effects on public health. Smart meters can report customers’ electricity usage remotely, thereby eliminating certain labor costs. By the time of the hearing, the employer had installed over three million smart meters.

The employee, who volunteered to testify at the hearing, also served as a union business manager and financial secretary. During his brief testimony, he asserted that there was an increasing problem with the meters burning up the meter bases. His testimony also made two arguable references to working conditions: (1) he received work orders to repair damaged boxes after meters had burned; and (2) his experiences with disgruntled customers.

The day after the employee’s testimony, the employer initiated an investigation to verify whether it had received complaints of smart meters causing fires and damaging customers’ homes. Concluding that the employee’s testimony was false, the employer terminated his employment. The Board affirmed an administrative law judge’s ruling that the employer violated Section 8(a)(3) by interfering with the employee’s protected union activities.

Ongoing dispute requirement. On appeal, the employer argued that the Board never addressed the first requirement of Jefferson Standard—that an employee’s appeal to a third-party “indicate it is related to an ongoing dispute between the employees and the employers.” Although the Board tacitly admitted that it didn’t address this point, it argued that the employer never raised the objection. However, the appeals court was satisfied that the employer did in fact raise this objection.

As an initial matter, the appeals court observed that neither Board nor court precedents make clear who has the burden of proof for the two conditions for employee protection under Jefferson Standard. In this case, there was no objective finding by the Board either that the employee disclosed his subjective motive to pressure the employer into concessions during labor negotiations, or that the subject of the employee’s statements were connected to an ongoing labor dispute. In the absence of any such findings, the mere “fortuity of the coexistence of a labor dispute and third-party disparagements do not satisfy the Jefferson Standard,” noted the court.

The Board also found that the employee’s testimony was protected because it related to a union concern about the “safety” of employees that it represented. However, the court found that the testimony made no detectable reference to worker risks. Further, the Board had done nothing to spell out the conditions under which a reference to an employer practice that may generate “disgruntled” consumers could “indicate” a link to a labor dispute.

Consequently, because the Board’s decision essentially skipped discussion of the first requirement for application of the Jefferson Standard test, the court remanded the decision for further consideration. On remand, the Board must make clear the burden of proof for Jefferson Standard’s first condition for protection of a disparaging statement, its conclusion on the merits of that issue, and its grounds for both conclusions.

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