Human Resources Management (HRM)

 

HRMD 620

Week 3

Introduction

071018   

 

Agenda

 

• Orientation to the Week
• Key federal laws
• Federal/State Preemption
• NLRA Sections 1, 7, & 8
• Concerted Activity
• Assignment: Exam #1

 

Orientation to the Week

 

So far this term we have been investigating labor relations from a general, macro perspective, looking at how it is defined, why it is relevant, how it evolved, and who is involved.  This week we focus on the legal structure that developed and operates today.  This is the last piece of the environment we will examine before moving next week to the detailed phases of collective bargaining.

 

Key Federal Laws

 

You’ll recall from last week that workers tried to create power by organizing into groups during the industrial revolution and rise of big business.  For most of that time, they had little legal support for their efforts.  They were often viewed by management and the courts as subversives, conspirators, groups that were trying to form monopolies of labor.  The Sherman Anti-trust Act of 1890, which prohibits corporations from creating monopolies, was applied to labor.  Court injunctions were levied to stop their activities, such as strikes.  In 1914, the Clayton Act, which proclaimed “the labor of a human being is not a commodity or article of commerce,” (Budd, 2013, p. 114) finally gave labor organizations legitimate existence.  Gompers and the AFL proclaimed this a victory because they viewed unions as “voluntary associations of workers, not incorporated organizations.  As such, freedoms to unionize, strike, and boycott were rooted in individual liberty, and the government should not interfere” (Budd, 2013, p. 114). Unfortunately for labor, in a twist of interpretation, the Clayton Act enabled more (not less) injunctions to be issued.  Labor’s struggle was not over.  However, its position improved in 1926 with the passage of the Railway Labor Act (RLA), which, though amended over the decades, is still in effect for the railroads and airlines today.  To avoid labor-management conflict, the initial RLA protected the individual rights of employees to form unions and established a means of resolving grievances.  It did not, however, specify when employers had to recognize the unions (Budd, 2013, pp. 17-18).

 

Passage of the Railway Labor Act signaled the beginning of a new era in labor law.  Two other significant pieces of legislation followed.  The Norris-LaGuardia Act of 1932, known as the “anti-injunction act,” curtailed the federal court’s powers to issue injunctions “that interfere with strikes, payment of strike benefits, publicizing a dispute (as long as it is not fraudulent), peaceful picketing, and workers joining unions” (Budd, 2013, p. 116). It also officially removed labor unions from the Sherman Antitrust Act, which supported the Mainstream Economics school of thought, and invalidated yellow dog contracts, which were “a promise by a worker not to join or support a union” (Budd, 2013, p. 113).  This illegal promise had been a condition of employment; if the worker did not promise, he/she would be fired or not hired.  This new Great Depression legislation utilized the Industrial Relations school of thought, but it did not protect or promote union activity explicitly.

 

During the recently-elected Roosevelt administration, one that promised the economically depressed country a “New Deal,” another law was passed:  the National Industrial Recovery Act of 1933 (NIRA).  Basically, this was a jobs program that addressed worker rights.  Lacking a specific means of enforcement, it did not succeed in balancing the power between corporations and labor.  It was ruled unconstitutional in 1935 by the U. S. Supreme Court who thought it was too broad.

 

Congress tried again.  Capitalizing on the lessons learned from the Railway Labor Act, which was amended in 1934 by “restricting company-dominated unions and by establishing the National Mediation Board to conduct secret ballot elections to determine whether a union should represent employees,” (Budd, 2013, pp. 118-19) as well as the nullified NIRA, Senator Robert R. Wagner of New York marshalled the 1935 National Labor Relations Act (NLRA), whose nickname is the Wagner Act, into law.  This is the primary legislation for the private sector that exists today and the one on which we will focus for the rest of the term.  It has had two major amendments, the 1947 Taft-Hartley Act (Labor Management Relations Act) and the 1959 Landrum-Griffin Act, which we’ll review later.

 

For now, let’s recap the key federal laws we identified in the last two weeks that govern labor relations today.

 

 

Sector	Federal Law	Governing Board
Private railways & airlines, as well as some publicly-owned commuter rails	1926 Railway Labor Act	National Mediation Board
Private organizations other than railway and airlines.  The U. S. Postal Service was added in 1970, with some restrictions.	1935 National Labor Relations Act (NLRA).  Also known as the Wagner Act.	National Labor Relations Board
Public – Federal level	1978 Civil Service Reform Act of 1978, Title VII.  Also known as the Federal Labor Relations Act (FLRA)	Federal Labor Relations Authority

 

 

 

Federal/State Preemption

 

Before we examine the NLRA in more detail, we need to understand the relationship of laws that might address the same situation.  Generally speaking, federal legislation overrides state laws.  The U.S. Constitution makes the federal law supreme, and the U. S. Supreme Court has, through various cases, determined that, in labor relations, if the activity in question clearly falls under the protection of Section 7 of the NLRA, the state law is overridden by the federal provision. This is the concept of preemption.  The same idea applies when local laws, such as county or city laws, are involved.  Federal law trumps state law; state law trumps local law.

 

You may recall when studying Title VII of the 1964 Civil Rights Act in an earlier course that at-will employment is a state provision.  It is “an employment relationship where there is no contractual obligation to remain in the relationship; either party may terminate the relationship at any time, for any reason, as long as the reason is not prohibited by law, such as for discriminatory purposes.”  (Bennett-Alexander & Hartman, 2012, p. 47).  Similarly, labor rights under federal labor law, such as NLRA Section 7 rights, also trump at-will provisions.  In other words, organizations cannot terminate employees “at will” if there are NLRA protections involved. We’ll see later that negotiated labor contracts themselves are also exceptions to at-will.  NOTE:  The relationship between at-will employment and the federal labor relations laws is very important to understand.  Many students miss this concept on tests.  Please review this again.  Ask questions if you need clarification.

 

NLRA Sections 1, 7, & 8 

 

The law itself is available at:  https://www.nlrb.gov/guidance/key-reference-materials/national-labor-relations-act

You can see in Section 1 that the purpose of the law is to prevent both management and labor from obstructing commerce.  It uses the Industrial Relations school of thought to validate its intended promotion of collective bargaining and protection of employee rights.

 

Section 7 is the key statement of coverage:

 

Sec. 7. [§ 157.] Employees shall have the right to self-organization, to form, join, or assist labor organizations, to bargain collectively through representatives of their own choosing, and to engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection, and shall also have the right to refrain from any or all of such activities except to the extent that such right may be affected by an agreement requiring membership in a labor organization as a condition of employment as authorized in section 8(a)(3) [section 158(a)(3) of this title].

 

Notice that there are two major types of coverage:  1)  protection to join or not join a labor organization, and 2)  other concerted activities .  We’ll spend several weeks looking at the first category, but today, we’re going to examine the second one, one that is getting increased attention.  What is “concerted activity” and how could an employer violate that right?

 

There are several ways Section 7 rights can be violated.  The NLRA identifies “unfair labor practices” for the employer in Section 8(a) and for the labor organization in Section 8(b).  The one we want to focus on today is Section 8(a)1 which prohibits the employer from interfering with an employee’s Section 7 rights.

 

Sec. 8. [§ 158.] (a) [Unfair labor practices by employer] It shall be an unfair labor practice for an employer–

 (1) to interfere with, restrain, or coerce employees in the exercise of the rights guaranteed in section 7 [section 157 of this title];

Let’s look at an example.

Did you post anything recently about your working conditions on one of the social media sites?  Did it have a negative tone?  Could your employer fire you for doing so?  It depends.

When is just having a work rule itself a violation of an employee’s Section 7 rights?  The answer is changing as a result of both new technologies and political shifts. On December 14, 2017, with a three-to-two vote in The Boeing Company, 365 NLRB Slip Op. No. 154 (2017), the National Labor Relations Board revised the criteria that are used to decide.  In June, 2018, based on his reading of that case, the Trump-appointed NLRB General Counsel notified its regional offices that there is new guidance for identifying which complaints should be carried forward.  The General Counsel said that work rules can fall into one of three categories:  1) lawful, 2) uncertain until further investigated, and 3) illegal.

• Category 1will include rules that the Board designates as lawful to maintain, either because (i) the rule, when reasonably interpreted, does not prohibit or interfere with the exercise of NLRA rights; or (ii) the potential adverse impact on protected rights is outweighed by justifications associated with the rule.  Examples of Category 1 rules are the no-camera requirement maintained by Boeing, and rules requiring employees to abide by basic standards of civility.  Thus, the Board overruled past cases in which the Board held that employers violated the NLRA by maintaining rules requiring employees to foster “harmonious interactions and relationships” or to maintain basic standards of civility in the workplace.

 

• Category 2will include rules that warrant individualized scrutiny in each case as to whether the rule would prohibit or interfere with NLRA rights, and if so, whether any adverse impact on NLRA-protected conduct is outweighed by legitimate justifications.

 

• Category 3will include rules that the Board will designate as unlawful to maintain because they would prohibit or limit NLRA-protected conduct, and the adverse impact on NLRA rights is not outweighed by justifications associated with the rule.  An example would be a rule that prohibits employees from discussing wages or benefits with one another.

 

Although the maintenance of particular rules may be lawful, the Board held that the application of such rules to employees who have engaged in NLRA-protected conduct may violate the Act, depending on the particular circumstances presented in a given case (Office of Public Affairs, 2017).

 

Category 1 suggests a change in direction. Previous NLRB decisions advised against having policies that are worded too broadly because they might be read in a way that would prohibit employees from engaging in Section 7 protected conduct. The new guidance, however, establishes a balancing test that weighs the negative impact on Section 7 rights against the employer’s business justification for the rule, such as the need to maintain discipline and productivity.

Many interpret the Boeing decision as being more employer-friendly while prior NLRB rulings were regarded by some as more employee-friendly. Specifically, it is predicted that the Boeing decision will result in fewer employer workplace rules being found violative of Section 7 employee rights.

There are several types of rules that apply to this more employer-friendly approach:

 

1. Civility Rules
2. No-Photography Rules and No-Recording Rules
3. Rules Against Insubordination, Non-cooperation, or On-the-job Conduct that Adversely Affects Operations
4. Disruptive Behavior Rules
5. Rules Protecting Confidential, Proprietary, and Customer Information or Documents
6. Rules against Defamation or Misrepresentation
7. Rules against Using Employer Logos or Intellectual Property
8. Rules Requiring Authorization to Speak for Company
9. Rules Banning Disloyalty, Nepotism, or Self-Enrichment

 

Let’s look at the first one, civility, to see how this might work.  An example of a rule in an employee handbook that might previously have been considered to be too broad to be legal but would now be acceptable is: “Disparaging, or offensive language is prohibited.”   The rationale for its presumed legal status, as explained by the NLRB General Counsel, is:

 

Impact on NLRA Rights: In Boeing the Board found that these types of rules, when reasonably interpreted, would not prohibit or interfere with the exercise of rights guaranteed by the Act. Indeed, the vast majority of conduct covered by such a rule, including name-calling, gossip, and rudeness, does not implicate Section 7 at all. In addition, the Board held that even if some rules of this type could potentially interfere with Section 7 rights, any adverse effect would be comparatively slight since a broad range of activities protected by the NLRA are consistent with basic standards of harmony and civility.11 For instance, while protected concerted activity may involve criticism of fellow employees or supervisors, the requirement that such criticism remain civil does not unduly burden the core right to criticize. Instead, it burdens the peripheral Section 7 right of criticizing other employees in a demeaning or inappropriate manner (Robb, 2017).

 

For an in-depth explanation of the changes and views, please see the General Counsel’s 18-04 memo at https://www.nlrb.gov/guidance/memos-research/general-counsel-memos

 

Keep this recent development in mind when reading the articles that show how employers might violate an employee’s concerted activity rights.  Read the Long article first because it lays the groundwork.  It explains how concerted activity is determined, that it must relate to working conditions and have an element of group action (the Meyers’s standard).  The behavior also cannot contain other characteristics that could invalidate the protection.   The other two articles, one by Model (2016) and the other by Droke et al. (2015), explain concerted activity protection through more examples.  See if you agree with the NLRB and whether the new rules would change the outcomes.

 

 

 

References

 

Bennett-Alexander, D., & Hartman, L.  (2012).  Employment law for business (7th ed.).  New

York, NY:  McGraw-Hill/Irwin.

 

Budd, J. W.  (2013).  Labor relations:  Striking a balance (4th ed.). New York, NY:  McGraw-

Hill/Irwin.

 

Carrell, M. R., & Heavrin, C.  (2013).  Labor relations and collective bargaining:  Private and

     public sectors (10^th ed.).  Boston, MA:  Pearson.

 

National Labor Relations Act of 1935; 29 U. S. C.  §151 et seq.  (West 1993).

 

Office of Public Affairs.  (2017, December 14).  NLRB establishes new standard governing

      workplace policies, and upholds no-camera policy in Boeing.  Retrieved from:

https://www.nlrb.gov/news-outreach/news-story/nlrb-establishes-new-standard- governing-workplace-policies-and-upholds-no

 

Robb, Peter J.  (2018, June 6).  GC 18-04 Memorandum:  Guidance on Handbook Rules Post-

     Boeing. National Labor Relations Board.  Retrieved at:

https://www.nlrb.gov/guidance/memos-research/general-counsel-memos

ANSWER

Human Resource Management: Case Study

NLRB is involved with unionized employees and those who are not. In the case of Evans Matt, matt has a case against his employers and could win the case against the company for unlawful termination. NLRB focuses mostly on the employee handbook. In this case, the employee handbook of this company is unlawful because it violates the employee’s NLRA rights. Section 7 protects the rights of the employee to communicate with the news media and other third parties about the terms and conditions of their employment (Droke et al., 2015). According to the HR department, Evans was terminated because of posting a disparaging post against his company, which violates section 8 of the employee handbook. Evans posted his concerns about his company on Facebook, which is his right according to section 7 of NLRA, and therefore, the employee should not have terminated him for practicing his lawful right to talk about his working conditions openly. From the Facebook post placed in his file, Evans expressed his concerns about his workplace and salary. An employee has the right to bargain with his employers for a better salary and a better working environment.

Mr. Evans has the upper hand in this case. The only play the company has in Evan’s case is that he signed the receipt of the employee handbook and agreed to be terminated at any time without any reason. However, taking his case to court would lead to several lawsuits and the scrutiny of their employee handbook. It could also encourage other employees to sue for their rights to unionize. The violations of the NLRA laws in their handbooks could be in the limelight, negatively affecting the company. The best action with Mr. Evans is to settle. They could also try to address the issues in their employee handbook to avoid further incidents. The issues highlighted in the post made by Evans should also be addressed. These issues include improving the employees working conditions and giving their employees a bargaining chance for their salaries and commissions. Some of his co-workers on the post made comments about the supervisor having to go, which is also an indicator of the supervisor having negative relations with his employees. These are the areas the company should address to prevent a repeat of the same incident as with Mr. Evans. The company should also know that discussing working conditions or stating an opinion on the working conditions is protected employee rights and should not be grounds for terminating an employee.

Ms. Dawson’s case is easier than the one of Mr. Evans. The NLRA does not protect the speech made by Ms. Dawson, and therefore she does not have a case. She could make the freedom of speech play, but the freedom of speech applies to the government, and therefore, a private company has the right to terminate her for violating company policy (Estlund, 2020). The company could also use the employment at will clause signed by Ms. Dawson, citing that she signed the clause and therefore the company has the right to terminate her employment at any time. The company’s section 8 employee handbook policy could, however, find itself in trouble again even in Ms. Dawson’s case because, according to the NLRB report, policies prohibiting employees from engaging in disrespectful negative inappropriate, or rude conduct towards the company or management will be found unlawful absent of further clarification. In this case, the company does not provide further clarification, which means that their employee handbook is unlawful.

The best play, in this case, would be the insubordination play. The company could claim that the post depicted the employee as insubordinate and disrespectful to her superior. Rules prohibiting conduct that amounts to insubordination are lawful. In the case of Ms. Dawson, she was disrespectful to the manager by posting about the sales manager and inviting ridicule on him. This could be viewed as grounds for disciplinary action to be taken against her, which was done through termination. By presenting these facts to the lawyer, Ms. Dawson will likely back off and not sue the company. It is, however, important for the human resource department in the company to review their employee handbook to make sure they are not violating the rights of their employees (office of public affairs, 2017). They should use both cases as a lesson on the things they should change in their company. The employee handbook, in this case, landed them in trouble because their employee handbook contains unlawful policies. They should also understand that the NLRB protects all employees, even those who are not unionized. The fact that they do not have unions in their company does not mean that their employees cannot sue them for unlawful termination. Therefore, they should be careful when terminating their employees. Ms. Dawson does not have a case here, and therefore her termination was lawful. Her case will not proceed unless she finds her new angle, which at this point is almost impossible.

 

 

 

 

 

 

 

 

 

References

Droke, M., Murphy, D., Herman, S., Bernhard, R., & Markison, J.  (2015).  NLRB report concludes that many common handbook policies violate the NLRA.  Employee Relations Law Journal, 41(2), 39-44. Retrieved from: https://www.dorsey.com/newsresources/publications/2015/03/nlrb-report-concludes-that-many-common-handbook

Estlund, C. (2020). Individual employee rights at work. In Comparative employment relations in the global economy (pp. 191-214). Routledge.

National Labor Relations Act of 1935; 29 U. S. C.  §151 et seq.  (West 1993). https://www.nlrb.gov/guidance/key-reference-materials/ley-de-relaciones-obrero-patronales

Office of Public Affairs.  (2017).  NLRB establishes new standards governing

 workplace policies and upholds the no-camera policy in Boeing. https://www.nlrb.gov/news-outreach/news-story/nlrb-establishes-new-standard-governing-workplace-policies-and-upholds-no