Trio of Board Cases Continue Recent Trends

Thumbnail image for NLRB seal.gifSeveral recent cases issued by the National Labor Relations Board continue to reflect a consistent majority view with respect to representation cases and unfair labor practice matters.  In Fiskardo Estiatorio, Inc. d/b/a Thalassa Restaurant, 356 NLRB No. 129 (March 31, 2011), the Board held that the employer, a New York City restaurant, had engaged in a host of Section 8(a)(1) violations of the NLRA, including interrogating, threatening and attempting to arrest an employee because he and a group of 20 to 25 nonemployees entered the restaurant during evening dining hours to deliver a letter protesting the employer’s alleged labor law violations. The employer’s wait staff had been expressing dissatisfaction over their belief that they were not getting all the tips left by the customers.  Employees advised restaurant management of the issues, and the wait staff consulted with the Restaurant Opportunity Center, an advocacy group, in New York City that organizes restaurant workers for workplace justice campaigns. 

Although the legal standard involving Section 8(a)(1) allegations was not in dispute, there was a significant factual disagreement.  When the dust settled, the administrative law judge and the Board majority accepted the employees’ version of events.  The majority stated that there was no evidence that the group disturbed the handful of patrons present, blocked the ingress or egress of any individual, was violent or caused damage, or prevented any employee from performing his work. Thus, the activity remained protected at all times.  This case underscores the importance of the credibility of witnesses and the cohesion of each witness’ version of the events.

In Terry Machine Co., 356 NLRB No. 120 (NLRB March 28, 2011), the Board reaffirmed its prior certification of an election.  The employer had contested the inclusion of its area coordinators in the bargaining unit, alleging that they were Section 2(11) supervisors.  Consistent with this position, the employer argued that some of the area coordinators engaged in objectionable, pro-union conduct during the representation campaign prior to the election (i.e., soliciting employee signatures for the union petition). 

In its holding, the Board assumed without deciding that the area coordinators were Section 2(11) supervisors and looked to Harborside Healthcare, Inc., 343 NLRB 906 (2004) for guidance on appropriate supervisory conduct.  Applying the two-step formula in Harborside Healthcare, the Board examined: (1) whether the supervisor’s pro-union conduct reasonably tended to coerce or interfere with the employees’ exercise of free choice in the election; and (2) whether the conduct interfered with employees’ freedom of choice to the extent that it materially affected the outcome of the election.  Further, the Board expressly emphasized that the supervisory solicitation of petition signatures has “an inherent tendency to interfere with an employee’s freedom to choose whether to sign or not.”  As such, “absent mitigating circumstances,” the supervisor’s conduct may be deemed objectionable.

Despite the Board’s emphasis on the inherent interference resulting from objectionable supervisory conduct, the employer in Terry Machine did not prevail.   The Board’s rationale was that the employer had mitigated any damage done by the pro-union supervisors’ conduct.  Specifically, the Board held that the employer: (1) engaged in an aggressive anti-union campaign; and (2) explicitly disavowed the area coordinators’ support for the union.  The Board noted specifically that the employer’s campaign included mandatory face-to-face meetings during which the employees were (according to the Board) explicitly told that the pro-union area coordinators did not represent the company’s position on unionization.   The Board also found that the area coordinators at issue were threatened with termination. Thus, the Board held that such “mitigating conduct” fully relieved any pressure that the employees may have felt to vote in a manner consistent with their supervisors. 

Finally, employers may be encouraged by the Board’s recent decision in Embarq Corporation and International Brotherhood of Electrical Workers Local Union No. 396, 356 NLRB No. 125 (NLRB March 31, 2011), although, in her concurring decision, Chairman Liebman recommended a change to a current standard regarding a company’s obligation to provide the union information on a relocation decision.  The Board held that the employer did not violate the Act by refusing to bargain with the union over its decision to close its call center and relocate that work to a call center in another state.   

The case was evaluated in light of the 1991 Dubuque Packing decision, in which the Board announced the test for determining whether a relocation decision is a mandatory subject of bargaining.  In Embarq, the Board found that the employer failed to show that there was a basic change in the nature of the employer’s operation because after the relocation it continued to provide customers with the same bilingual customer service, and its call center employees continued to perform their work in same manner. In addition, the Board found that the employer failed to prove that labor costs were not a factor in its decision to relocate unit work, as the company was clearly focused on the efficiency and productivity of its call center employees, and these constituted indirect labor costs.  Nonetheless, the Board agreed with the ALJ and held that the call center’s relocation was not a mandatory subject of bargaining because the employer had sufficiently demonstrated that the union could not have offered labor-cost concessions sufficient to change its decision to relocate.  As it was not a mandatory subject, the employer did not breach the Act by refusing to provide the union with information related to the decision to relocate.  

Despite the decision, Chairman Liebman’s concurring opinion raises some concern regarding an employer’s right to make a decision to relocate without bargaining and, more importantly, without the union being able to look at company documents detailing its decisionmaking process.  An employer has the statutory obligation to provide, on request, relevant information that the union needs for the proper performance of its duties as collective bargaining representative.  However, as Chairman Liebman notes, “current law does not compel the production of information at the time when it is sought – or, indeed, ever – if the Board, in hindsight, determines that concessions would have made no difference, even where . . . no bargaining ever occurred and the union had no opportunity to explore or influence the employer’s decision.”   As such, unless and until the Board finds that an employer’s decision to relocate was subject to mandatory bargaining, an employer, in practice, is not required to turn over relevant company information to the union.  The result often is a “stalemate” with the union refusing to proceed with either decision or effects bargaining until it has the information necessary to bargain effectively.  When this is the case, Chairman Liebman explained, it is the Board’s responsibility to determine whether labor-cost concessions affect the employer’s decision, even if the company had not put forth this reason during bargaining or if no bargaining ever took place.

Chairman Liebman took her assessment further.  She recommended a modification to the long-standing Dubuque framework, writing that employers should be required to provide unions with requested information about relocation decisions whenever there is a reasonable likelihood that labor-cost concessions might affect the decision.  According to Chairman Liebman, rather than waiting for an after-the-fact assessment of whether bargaining might have been successful, sharing company information may, in fact, facilitate bargaining.

This entry was written by Tedd J. Kochman and Lindsay M. Sorin.

Information contained in this publication is intended for informational purposes only and does not constitute legal advice or opinion, nor is it a substitute for the professional judgment of an attorney.