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Employers Under the Microscope: Is Change on the Horizon?

When: Tuesday, October 18, 2016 8:00 a.m. – 4:00 p.m.

Where: New York Hilton Midtown, 1335 Avenue of the Americas, New York, NY 10019

Epstein Becker Green’s Annual Workforce Management Briefing will focus on the latest developments in labor and employment law, including:

  • Latest Developments from the NLRB
  • Attracting and Retaining a Diverse Workforce
  • ADA Website Compliance
  • Trade Secrets and Non-Competes
  • Managing and Administering Leave Policies
  • New Overtime Rules
  • Workplace Violence and Active-Shooter Situations
  • Recordings in the Workplace
  • Instilling Corporate Ethics

This year, we welcome Marc Freedman and Jim Plunkett from the U.S. Chamber of Commerce. Marc and Jim will speak at the first plenary session on the latest developments in Washington, D.C., that impact employers nationwide.

We are also excited to have Dr. David Weil, Administrator of the U.S. Department of Labor’s Wage and Hour Division, serve as the guest speaker at the second plenary session. David will discuss the areas on which the Wage and Hour Division is focusing, including the new overtime rules.

In addition to workshop sessions led by attorneys at Epstein Becker Green – including some contributors to this blog! – we are also looking forward to hearing from our keynote speaker, Former New York City Police Commissioner William J. Bratton.

View the full briefing agenda here.

Visit the briefing website for more information and to register, and contact Sylwia Faszczewska or Elizabeth Gannon with questions. Seating is limited.

Retail employers dismayed by employees publicly airing workplace grievances in disparaging social media posts must think twice before taking disciplinary action.  On August 18, 2016, the National Labor Relations Board (“NLRB”) confirmed the finding by Administrative Law Judge Susan A. Flynn that Chipotle’s social media policy forbidding employees from posting “incomplete” or “ inaccurate” information, or from making “disparaging, false, or misleading statements” on Twitter, Facebook and other social media sites violates Section 8(a)(1) of the National Relations Labor Act (“the Act”).

Chipotle discovered that an employee responded to a customer’s tweet thanking Chipotle for a free food offer, by tweeting back: “@ChipotleTweets, nothing is free, only cheap #labor. Crew members make only $8.50hr how much is that steak bowl really?”  Then, attaching a news article describing how hourly workers at Chipotle were required to work on snow days while certain high-level employees were not, the employee tweeted his displeasure, specifically referencing Chipotle’s Communications Director: “Snow day for ‘top performers’ Chris Arnold?”  Informed by his manager that Chipotle considered his tweets to be in violation of Chipotle’s social media policy, the employee removed them at Chipotle’s request.  Then, several weeks later, Chipotle fired the employee after he circulated a petition about employees not receiving required breaks.

Finding the provision in Chipotle’s policy prohibiting employees from spreading “incomplete” or “inaccurate” information to be unlawful, Judge Flynn opined that: “An employer may not prohibit employee postings that are merely false or misleading.  Rather, in order to lose the [NLRA]’s protection, more than a false or misleading statement by the employee is required; it must be shown that the employee had a malicious motive.”   Judge Flynn also found the policy provision prohibiting “disparaging” statements to be unlawful, explaining that it “could easily encompass statements protected by Section 7 [of the NLRA]” including “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.”   Although Chipotle’s social media policy contained a disclaimer that the policy “does not restrict any activity that is protected by the National Relations Labor Act, whistleblower laws, or any other privacy rights,” Judge Flynn concluded that this “sentence does not serve to cure the unlawfulness of the foregoing provisions.”

The NLRB adopted Judge Flynn’s decision that Chipotle was wrong, not only for firing the employee, but for attempting to limit his commentary on social media by its unlawfully termed social media policy.  While agreeing with Judge Flynn’s reasons for finding the social media policy unlawful, the NLRB disagreed with Judge Flynn’s finding that Chipotle violated the NLRA by asking the employee to delete the tweets.  In particular, while Judge Flynn opined that the employee engaged in “concerted activity” even though he did not consult with other employees before posting his tweets because “concerted activities include individual activity where individual employees seek to initiate or to induce … group action,”  the NLRB disagreed, asserting, with no true explanation, that it did not find the employee’s conduct to be concerted.  Agreeing that Chipotle violated the NLRA by terminating the employee after he engaged in protected concerted activity by circulating a petition regarding the Company’s break policy, the NLRB required Chipotle to, among other things, post signs acknowledging that its social media policy was illegal, and to re-instate the employee with back pay.

The message from the NLRB to retail employers is that, barring malicious misstatements, speech concerning terms and conditions of employment is often protected activity, even for employees who want to criticize their employers on Twitter and other social media websites.  To avoid Chipotle’s fate, ensure that your social media policies are up to date and provide for the increasing protections afforded to employee social media activity by the NLRB.

A new Act Now Advisory will be of interest to many of our readers in the retail industry: “Union Organizing at Retail and Food Service Businesses Gets Boost from New York City ‘Labor Peace’ Executive Order,” by our colleagues Allen B. Roberts, Steven M. Swirsky, Donald S. Krueger, and Kristopher D. Reichardt from Epstein Becker Green.

Following is an excerpt:

New York City retail and food service unions got a boost recently when Mayor Bill de Blasio signed an Executive Order titled “Labor Peace for Retail Establishments at City Development Projects.” Subject to some thresholds for the size and type of project and the amount of “Financial Assistance” received for a “City Development Project,” Executive Order No. 19 mandates that developers agree to a “labor peace clause.” In turn, the labor peace clause will compel the developer to require certain large retail and food service tenants to enter into a “Labor Peace Agreement” prohibiting their opposition to a “Labor Organization” that seeks to represent their employees. …

If the objective of the Executive Order is to assure labor peace by way of insulation from picketing, work stoppages, boycotts, or other economic interference, it is not clear how its selective targeting of retail and food service tenants occupying more than 15,000 square feet of space—and the exclusion of other tenants and union relations—delivers on its promise. There are multiple non-covered tenants and events that could occasion such on-site disruptions as picketing, work stoppages, off-site boycotts, or other economic interference.

As a threshold matter, there is no particular reason why a labor dispute with a tenant occupying space shy of 15,000 square feet—among them high-profile national businesses—somehow is less disruptive to the tranquility of a City Development Project than one directed at a tenant whose business model requires larger space.

Also, the Executive Order does not address the rights or responsibilities of either landlords or their tenants that are Covered Employers bound to accept a Labor Peace Agreement when faced with union demands for neutrality that go beyond the Executive Order’s “minimum” neutrality requirements. There could be a dispute over initial labor peace terms if a union, dissatisfied that the Executive Order’s Labor Peace Agreement secured only a Covered Employer’s “neutral posture” concerning representation efforts, were to protest to obtain more ambitious and advantageous commitments that are coveted objectives of union neutrality demands, such as …

Read the full Advisory here.

Our colleagues Adam C. Abrahms and Steven M. Swirsky, attorneys at Epstein Becker Green, have a post on the Management Memo blog that will be of interest to many of our readers in the retail industry: “NLRB Drops Other Shoe on Temporary/Contract Employee Relationships: Ruling Will Require Bargaining In Combined Units Including Employees of Multiple Employers – Greatly Multiplies Impact of BFI Expanded Joint Employer Test.”

Following is an excerpt:

The National Labor Relations Board (“NLRB” or “Board”) announced in its 3-1 decision in Miller & Anderson, 364 NLRB #39 (2016) that it will now conduct representation elections and require collective bargaining in single combined units composed of what it refers to as “solely employed employees” and “jointly employed employees,” meaning that two separate employers will be required to join together to bargain over such employees’ terms and conditions of employment.” …

The potential for confusion and uncertainty is enormous. In an attempt to minimize these concerns, the Board majority stated that the so-called user employer’s bargaining obligations will be limited to those of such workers’ terms and conditions that it possesses “the authority to control.”

Read the full post here.

Our colleagues Adam C. Abrahms and Steven M. Swirsky, attorneys at Epstein Becker Green, have a post on the Management Memo blog that will be of interest to many of our readers in the retail industry: “Department of Labor Releases New Persuader Rule Intended to Aid Union Organizing.”

The US Department of Labor has finally issued its long awaited Final Rule radically reinterpreting the “Advice Exemption” to the Labor Management Reporting and Disclosure Act of 1959 (“LMRDA.”).  The Final Rule eviscerates any meaningful use of the Advice Exemption, which would be swallowed up by the new expansive definition of persuader activity which could include discussion regarding strategy, reviews of employer drafts and myriad other ways labor attorneys currently aid their clients including essentially any meaningful advice or counsel provided by labor counsel. The move comes just over two years to the day from the DOL’s 2014 postponement of its issuance of the Final Rule. …

Read the full post here.

Maxine NeuhauserIn a decision with ramifications for employers in health, retail, hospitality and other industries serving the public, on October 22, 2015 in a decision, Marina Del Rey Hospital, 363 N.L.R.B. No. 22, 2015 BL 347693, the NLRB confirmed the legality of policies barring employees from the premises when not on duty, which contain an exception permitting off-duty employees to be on the premises as members of the public, e.g., as a patient or a visitor.  The Board found, however, that enforcement of the facially neutral policy to certain employment restrict protected activity constitutes an unfair labor practice. The decision addressed the policy stated in the Marina Del Rey Hospital’s employee handbook stating:

Off-duty employees may access the Hospital only as expressly authorized by this policy. An off-duty employee is any employee who has completed or not yet commenced his/her shift.

An off-duty employee is not allowed to enter or re-enter the interior of the Hospital or any Hospital work area, except to visit a patient, receive medical treatment, or conduct hospital-related business. “Hospital related-business” is defined as the pursuit of an employee’s normal duties or duties as specifically directed by management.

An off-duty employee may have access to non-working, exterior areas of the Hospital, including exterior building entry and exit areas and parking lots.

Any employee who violates this Policy will be subject to disciplinary action up to and including termination.

The record before the Board established that the hospital permitted off-duty employees on premise for non-union, employment-related activities such as picking up paystubs, submit­ting scheduling requests, applying for a transfer, and at­tending social events, e.g. retirement parties and wed­ding and baby showers. On at least two occasions, however, the hospital applied the off-duty access policy to prevent or curtail off-duty employees from meeting with union representatives in the hospital cafeteria. The Board found that this disparate enforcement of the otherwise facially lawful constituted an unfair labor practice in violation of employees’ Section 7 rights.

While at first blush the decision appears to favor a policy permitting carve outs, as a practical matter, the problematic examples of employee off-duty conduct, e.g., picking up pay stubs, applying for and the like, that the Board found problematic point to the difficulty employers are likely to have in maintaining a no access rule with carve-outs.

My colleague Steven M. Swirsky at Epstein Becker Green published a Management Memo blog post concerning U.S. District Judge Amy Berman Jackson granting summary judgment in favor of the NLRB – “Washington Court Dismisses Challenge to NLRB’s Ambush Election Rules.”

Following is an excerpt:

U.S. District Court Judge Amy Berman Jackson on Wednesday issued a 72 page opinion (PDF) rejecting each of the arguments raised by the U.S. Chamber of Commerce, the National Retail Federation and other business groups and found that the Amended Election Rules adopted by the National Labor Relations Board in December 2014, which took effect in April 2015, in an action that argued that the Board had exceeded its authority, violated the Administrative Procedures Act and that the Amended Rules were unconstitutional.

Read the full original post here.

Scheduling around employees taking frequent or extended leaves of absences can be complicated for retail companies looking to staff the floor during peak shopping periods.  But retail employers considering requests for leave under the Family and Medical Leave Act should be aware of a recent decision from the District of Columbia Circuit Court of Appeals finding that an employee can pursue an FMLA interference claim even though she received the leave requested.  In Gordon v. United States Capitol Police, No. 13-5072 (D.C. Cir. Feb. 20, 2015), the D.C. Circuit held that an employer who discourages an employee from taking FMLA leave may be liable for an interference claim, even if that discouragement was “ineffective.”  The lesson: don’t bully, discourage, or make employees jump through unnecessary hoops if they ask for FMLA leave.

Judy Gordon, an officer with the Capitol Police, was granted FMLA leave to address intermittent periods of severe and incapacitating depression.  Before her leave commenced, Gordon’s superiors ordered her to submit to a “fitness for duty examination” because of her FMLA request.  While waiting for the examination, Gordon was reassigned to administrative duties, resulting in a loss of $900 (the equivalent of three days’ pay).  Gordon passed the examination, was reinstated to her prior post, and took the requested FMLA leave and returned without incident.  Nonetheless, Gordon sued, asserting claims of interference and retaliation under the FMLA, and alleging that the presence of the “fitness for duty examination” on her permanent record would be detrimental to her prospects for pay increases, promotions, and transfers.

Addressing an issue of first impression for the D.C. Circuit, the court considered whether Gordon could proceed with her FMLA interference claim even though she was granted and ultimately took the requested leave.  Drawing an analogy between the interference provisions of the FMLA and the NLRA – which courts have interpreted to permit NLRA Section 8 claims based on actions that have a “reasonable tendency” to interfere with employees’ rights, regardless of whether they actual did – the court held that “an employer action with a reasonable tendency” to interfere with an FMLA right may support a valid interference claim “even where the action fails to actually prevent such exercise or attempt.”

Here, the D.C. Circuit reinstated the inference claim because it found that subjecting Gordon to a fitness for duty examination, which resulted in her loss of $900 and potentially impacted her future career prospects, would have a “reasonable tendency” to interfere with an employee’s exercise of FMLA rights.  The court also appeared to be influenced by allegations in the complaint that upper-managers frowned upon FMLA leave generally and were looking for ways to prevent Gordon from taking leave.

In its decision, the court set a low threshold for what constitutes an adverse action sufficient to support an FMLA retaliation claim.  One of the elements of a prima facie case of FMLA retaliation is a showing that the plaintiff was adversely affected by an employment decision.  The court refused to decide whether that element requires a showing of “material adversity” – as articulated for Title VII claims in Burlington Northern & Santa Fe Railway Co. v. White, 548 U.S. 53, 68-70 (2006) – or something less, such as any monetary loss, no matter how small – as suggested in Ragsdale v. Wolverine World Wide, Inc., 535 U.S. 81 (2002).  Rather, the court concluded that the loss of $900, the equivalent of three days’ pay, was more than de minimis and met the higher “material adversity” threshold, allowing the FMLA retaliation claim to proceed.

This decision is a reminder to employers, particularly those with operations in Washington, DC, to tread carefully when processing requests for leave under the FMLA.  Although leaves of absence can be disruptive to the workforce, and employers are within their rights to make certain inquiries into the need for leave, the mere fact that FMLA leave is ultimately granted will not insulate an employer from potential liability for conduct that has the potential to dissuade an employee from requesting leave.  To avoid unnecessary litigation, employers should instruct their leave administrators and supervisors to refrain from openly questioning or criticizing an employee’s request for leave and from requiring additional certifications beyond those contemplated by the law.

On January 5, 2015, less than one month after the National Labor Relations Board (NLRB) voted to adopt a Final Rule to amend its rules and procedures for representation elections, a lawsuit has been filed in the US District Court for the District of Columbia, asserting that the Board exceeded its authority under the National Labor Relations Act (Act) when it amended its rules for votes on union representation and that the new rule in unconstitutional and violates the First and Fifth Amendments of the US Constitution.

The suit was filed by the Chamber of Commerce of the United States, Coalition for a Democratic Workplace, National Association of Manufacturers, the National Retail Federation and the Society for Human Resources Management.  It seeks an order vacating the Final Rule, declaring the Final Rule to be contrary to the Act and in excess of the Board’s statutory jurisdiction and authority and to violate the First and Fifth Amendments.

The claims raised in the suit are essentially the same as those which were raised by in an action filed in the same court in 2012, in response to the NLRB’s December 2011 adoption of a very similar set of changes to its representation election procedures.  That action also challenged the Board’s action based on what it found to be the Board’s lack of a quorum at the time it adopted those rule changes in 2011. Because the Court found that the Board lacked a quorum at that time, it found it unnecessary to address the substantive arguments about the changes in the election rules that are the essence of the new lawsuit.

While the Complaint does not indicate that the plaintiffs are seeking an order enjoining the Board from implementing the new election procedures under the Final Rule while the case is litigated, the plaintiffs are likely to request such an order as the Final Rule’s effective date of April 15th nears.  In the earlier challenge to the Board’s 2011 rulemaking, the Court granted an injunction in April 2012 enjoining the Board from putting the new rules and procedures into effect, while it considered the merits of the challenge.

While Republican members of Congress have with increasing frequency indicated their desire to reign in the Board in a variety of areas where they have seen it as exceeding its mandate or moving in directions that they do not agree with, it is almost certain that President Obama would veto such legislation and it is not likely that the sufficient support would be present to override a veto. Thus as the New York Times observed  earlier this week, those who oppose administrative actions such as this are turning increasingly to the courts in hopes of relief.

We will continue to monitor and report on developments in this closely watched case.

Our colleague Steven Swirsky at Epstein Becker Green wrote an advisory on an NLRB ruling that affects all employers: “NLRB Holds That Employees Have the Right to Use Company Email Systems for Union Organizing – Union and Non-Union Employers Are All Affected.” Following is an excerpt:

In its Purple Communications, Inc., decision, the National Labor Relations Board (“NLRB” or “Board”) has ruled that “employee use of email for statutorily protected communications on nonworking time must presumptively be permitted” by employers that provide employees with access to email at work.  While the majority in Purple Communications characterized the decision as “carefully limited,” in reality, it appears to be a major game changer.  This decision applies to all employers, not only those that have union-represented employees or that are in the midst of union organizing campaigns.

Under this decision, which applies to both unionized and non-union workplaces alike, if an employer allows employees to use its email system at work, use of the email system “for statutorily protected communications on nonworking time must presumptively be permitted . . . .” In other words, if an employee has access to email at work and is ever allowed to use it to send or receive nonwork emails, the employee is permitted to use his or her work email to communicate with coworkers about union-related issues.

Read the full advisory here.