Minority Unions – A Major Concern for Employers in 2021 and Beyond?

Recent media reports have covered the relatively new phenomenon of minority labor unions.  These are not traditional unions in the sense of formal organizing, National Labor Relations Board (NLRB) certification, and exclusive collective bargaining rights. Rather, they are organizations made up of groups of individuals (including traditional employees, temporary employees, and even contractors) who seek to advocate for worker rights and social justice issues in the 21st century workplace. 

Throughout 2020, social justice issues have manifested themselves in the workplace more than ever before, and unions are capitalizing on these issues to garner interest from employees in new and different ways.  As the world slowly moves past the pandemic, workplaces—like many things—may never go back to the way they once were. For example, while many employees will return to their offices and previous workspaces, others will continue to work remotely. Indeed, many high-tech companies are leading the way in embracing the remote workplace. Further, as the gig economy continues to expand, labor rights issues will be a continuing focus, with increasing pressure to treat gig workers more like traditional employees. Whether traditional labor unions can capitalize on these trends is anyone’s guess, but growing advocacy in the new workplace, on behalf of all types of workers, will present difficult and unprecedented challenges for employers.  

Traditional Representation

Labor relations under the National Labor Relations Act (NLRA) is premised on the concept of exclusivity.  For a union to secure the right to bargain contract terms with an employer on behalf of a group of employees, it must demonstrate that it represents a majority of the employees in an appropriate bargaining unit.  Labor unions that do not have such majority support do not have such rights.  In fact, it is unlawful for an employer to bargain or “deal with” a minority union on behalf of a broader group of employees unless that union in fact represents a majority of those employees.  By contrast, gig economy workers typically are considered independent contractors and excluded from coverage under the NLRA.  The exclusion of gig workers from NLRA coverage has prevented unions from organizing them and proved a source of frustration for both unions and some gig workers. 

Rise of Alternative Representation

For many reasons, U.S. labor unions often have found it difficult or simply have been unable to secure representation rights for certain employees through the traditional NLRB secret ballot election process.  In response, many unions have pursued or otherwise promoted alternative means to garner support among and advocate on behalf of employees in the workplace – largely in an effort to build their dues-paying membership ranks or otherwise increase their revenue sources.  During the early 2000s, employers saw the emergence of worker centers in a number of industries.  Worker centers, which are largely union-sponsored advocacy groups, often seek to advocate on behalf of workers in low-skilled and semi-skilled industries without actually being lawful bargaining representatives of these employees. Worker centers deployed similar strategies seeking both to increase interest in the unions that backed these organizations and to effectuate change in the workplace through advocacy and local legislation, but without any representation mandate from a majority of the employees.  Over time, it became clear that many of these groups were funded or sponsored by existing traditional labor unions.  In recent years, activity initiated by worker centers has subsided, although we believe they are poised for a resurgence with the change in federal administration. 

At the same time that worker centers were growing in number and influence, the NLRB was expanding protections available to unrepresented workers.  Under the doctrine of protected concerted activity, an employee who is not represented by a labor organization still enjoys the protections of the NLRA if that employee acts with or on behalf of other employees concerning wages, hours, or other terms and conditions of employment.  Many workplace policies that limited employee behavior, such as prohibitions against uncivil or inappropriate conduct, were declared overly broad and unlawful under Section 7 of the NLRA. Discipline for violations of such overly broad policies was frequently overturned by the NLRB, leaving employers perplexed about their rights to manage employee misconduct in the workplace.  Outreach efforts by the Board encouraged employees to engage in protected, concerted activity under Section 7 of the NLRA and made workers more familiar with federal labor laws, unions and traditional union representation.

Change in Administration

Fast forward to 2021 and a new Democratic administration under President Biden.  Irrespective of whether there is any structural change to the NLRA through passage of the Protecting the Right to Organize (PRO) Act or other legislation, which certainly is a possibility with Democratic control of both houses of Congress, it is likely we will see a return to the previous Obama-Board approach of promoting concerted activity and collective bargaining in the workplace.  In 2021, however, the business context where such rights play out will be vastly different from what it was during 2008 to 2016.  In the last four years, the United States has faced unprecedented social unrest over racial, socioeconomic, and political issues and events.  Activism on these subjects is at an all-time high, and it is manifesting itself in the workplace as never before. In some instances, an employer’s own programs and efforts to address these social issues have nurtured and encouraged employee activism in this regard – particularly in social media.  In others, the activism originates among employees themselves or is prompted by sources outside the organization.  With social media, instantaneous communication to broad groups of employees and employee supporters across the country and the globe, as well as ready access to information, and more people working remotely or in the gig economy, encouraging activism by groups of workers in conjunction with non-employee activists is extremely easy. This is particularly the case where the workforce includes younger, highly educated and progressive thinking, and/or tech-savvy employees.  We expect that in 2021 and beyond, this demographic will continue to drive significant change in the workplace from the inside, and we will continue to see an increase in employee activism.

New Collective Activism

To date, we already have seen an uptick in collective action within this demographic, particularly within the high-tech sector, a white collar work environment not traditionally associated with union representation and collective action.  These employees are fully conversant with their rights, how to advocate for those rights, and the communication tools they need to align and broadcast their message.  Often, they are encouraged by their employer’s workplace culture to advance these issues. 

Interestingly, these employees, particularly in the high-tech sector, often are not focused on the traditional topics that tend to drive union organizing in other sectors.  For the most part, this demographic of worker is well paid, and comfortable with the working conditions and benefits they enjoy.  Poor or non-responsive management, typically another driver of unionization, does not tend to fuel this new collective activism.  Instead, we see atypical issues that drive the agenda.  Single or ad hoc issues such as the use of company products/services, sales to a particular customer, or a strategic business decision often serve as rally points for collective action.  Similarly, in traditional collective bargaining relationships that do exist in the high-tech sector, concerns do not tend to focus around things like wages, benefits, or even workplace safety.  Instead, these workers focus on access to executive leadership or even a company’s Board of Directors and other stakeholders to address key social justice issues.  Other demands revolve around seeking to have a voice in the strategic direction of the organization, not only as it relates to employees, but as it relates to customers, vendors, suppliers, and the community, and world, at large.  Even traditional unions struggle with this type of collective action because it often does not fit neatly into typical mandatory terms and conditions of employment that employers must bargain over with representative unions.    

Thus, the increase in this atypical activity raises the issue for both employers and unions as to how they can best address these types of employees and these types of employee concerns. For unions, one mechanism they are using to address these issues is the formation of minority unions where the labor organizations are not confined by either the traditional bargaining model or the traditional organizing model that focuses on one discrete bargaining unit at a time. 

Employer Considerations for Minority Unions

Although there is no one-size-fits-all solution for employers, there are some overarching guidelines that employers should keep in mind. 

First, recognize that collective action under Section 7 of the NLRA, whether initiated by a group of employees or by an individual on behalf of others, is protected.  Taking adverse action against employees for engaging in such conduct is unlawful. 

Second, giving in to demands or negotiating with small groups of employees raises significant concerns.  If a group has not been designated by a majority of employees in an appropriate bargaining unit, it does not have the same representation rights as a majority union, and the employer cannot be compelled to bargain with the minority union.   

Third, be careful to avoid creating collective issues that may result in larger problems for the employer.  Many high-tech companies promote free thought and expression and often encourage social justice advocacy.  While such goals are laudable, they also may backfire when that advocacy targets the company, the company’s customers, its products/services, or other company decisions or actions.  

Fourth, follow developments in this space such as gig worker legislation, the PRO Act, anticipated changes at the NLRB, and initiatives undertaken by the Biden administration to enhance worker rights and promote union representation through traditional NLRA bargaining or even sectoral bargaining.  Much of this effort will result in the blurring of traditional distinctions between independent contractors and employees, and may have the greatest impact on the gig economy.

Fifth, understand that while minority unions do not have the ability to compel an employer to sit at the bargaining table and negotiate a collective bargaining agreement, a minority group of activists (employees and contractors separately or together) may pressure employers and advocate for workers through other very powerful means.  These include work stoppages and other job actions, harmful public relations campaigns, and other activities.

Sixth, while a group that has not been designated by a majority of employees in an appropriate bargaining unit does not have the same representation rights as a majority union, and negotiating with such a group about wages, hours or working conditions for all employees is illegal, members-only agreements, which are in essence based on minority support, are not unlawful under the NLRA.  Still, such agreements are not afforded the same protections under the NLRA, and companies need to develop ways to strike a balance among rebuffing these groups’ demands, maintaining credibility within a workforce that consists of activist employees, and also, maintaining credibility with broader external audiences that are watching to see how the company reacts. 

Finally, while minority unions may prove more influential in 2021 and beyond in advancing employees’ rights to engage in some types of collective action, organized labor still may not see a benefit.  Thus, while more workers may look to unions to support their social activism, it remains unclear whether traditional unions will be able to adapt effectively to utilizing a minority representation model to actually advance employee social justice objectives.  It is also unclear whether this model will satisfy labor’s need to increase its revenue sources.  Moreover, even if effective in advancing employees’ objectives, minority unions may prove to be a double-edged sword for organized labor by undermining support for traditional unions (which tend to be more costly for members), thereby harming organized labor more than helping it.  

Please reach out to experienced counsel for any support you may need as we navigate 2021, a year of transformation.

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.