Deluge of labor board decisions likely as sole Democrat exits (Bloomberg Law)

Reprinted with permission from Bloomberg Law News Dec 11, 2019
By Hassan A. Kanu and Robert Iafolla

  • Five-member board’s only Democrat departs Dec. 16
  • Pro-business decisions expected in coming days

The National Labor Relations Board is expected to be quite busy in coming days, as the agency’s sole Democratic member, Lauren McFerran, reaches the end of her term Dec. 16.

The board has historically issued a flood of case decisions, both routine and major, in the final days of a member’s term. The practice was adopted in light of the agency’s unique structure—a five-seat, bipartisan panel designed so that one member’s term expires each year. McFerran’s departure will make the NLRB a Republican-only board, because the other Democratic seat has been vacant for a year.

The NLRB will stick to past practice this year, and that means the 3-1 Republican majority is likely to release a series of pro-employer case rulings before McFerran departs, according to labor law practitioners and three current and former board officials. That would continue the board’s push during the Trump administration to dismantle a slew of Obama-era decisions that the business community has sharply criticized as overreach.

Cases in which the board is nearly finished drafting an opinion are likely candidates for a ruling in coming days. The board may also take next steps on one or more of the unusual number of federal regulations the agency proposed this year.

“I expect the board will try to get out as many of the decisions where McFerran’s on the panel as they can,” said Jerry Hunter, a management-side lawyer at Bryan Cave Leighton Paisner and former Republican NLRB general counsel. (Mr. Hunter also serves as the current Chairman of the Board of Directors of Associated Industries of Missouri.)

The NLRB often issues decisions via a three-member panel—the minimum required for a quorum—although all members are typically involved in cases overturning existing precedent.

“I think they’ll definitely try to get out any decisions where she’s currently on a panel of three if it’s in a shape to do that, and that’s in part so they don’t have to reassign those to a new member who would then have to start all over,” Hunter said.

The most highly anticipated case ruling the NLRB may hand down before McFerran leaves is one in which it’s expected to reverse an Obama-era precedent that gave workers the right to use company email for organizing purposes. The NLRB, in the 2018 Caesars Entertainment case, asked for public comment on whether it should strike down that 2014 policy, and hasn’t decided the matter.

The board also has been considering for months whether to accept a settlement offered by McDonald’s in a high-profile case that seeks to tag the company as a “joint employer” of workers at franchise restaurants. A ruling against McDonald’s could threaten its business model and those of other companies that rely on contractors, industry insiders and observers have said.

Potential Candidates for a Ruling

The board’s Republican majority has already undone a number of pro-worker rulings issued during the Obama administration. Republicans and business groups have hailed those moves as restoring balance to labor -management relations, while worker advocates have decried what they call the whittling down of rights on the job.

There are other potentially precedent-changing cases that may be decided before McFerran’s term is up. That includes:

  • Apogee Retail , which could overturn the NLRB’s 2015 ruling in Banner Estrella and free employers to require their workers to stay silent about disciplinary investigations;
  • United Parcel Service , which could overturn the NLRB’s 2014 ruling in Babcock and Wilcox and lower the bar for deferring to a decision from private arbitration or a union grievance process; and
  • Valley Hospital Medical Center, which could overturn the NLRB’s 2015 ruling in Lincoln Lutheran of Racine and empower employers to unilaterally stop collecting union dues when a labor contract expires.

Attorneys and officials who spoke with Bloomberg Law generally agreed it’s highly unlikely any of the three Republicans will form a bipartisan majority with McFerran and issue a precedent that favors workers or unions.

“The Republican members of the NLRB are as unalterably pro-employer as any we’ve ever seen and are fairly relentlessly pushing their agenda,” Judy Conti, government affairs director at the National Employment Law Project, a worker advocacy group, told Bloomberg Law in an e-mail.

“I would imagine they will try to put out as many decisions as possible while they still have a quorum, and I also assume that their pro-employer leanings will continue to rule the day.”

Patrick Semmens, vice president of public information at the National Right to Work Legal Defense Foundation, took a different view. The group is a key labor-policy stakeholder on the conservative side of the aisle, and often represents workers who wish to decertify, or oust, their unions.

“Foundation staff attorneys represent only workers, not employers, and yet McFerran has regularly ruled against those workers during her term,” Semmens said.

More “often than not she has been on the anti-worker side of our cases,” he added, and there’s “no reason to believe that pro-union boss and anti-worker bias won’t continue in the final days of her term.”

What’s Next?

The NLRB will likely function with an all-Republican slate for some time after McFerran’s term ends. President Donald Trump isn’t obligated to appoint a full complement of members to the board, and the agency can issue decisions with just three. Trump has yet to nominate someone to fill the board’s other Democratic seat after former chairman Mark Pearce removed his name from consideration in February.

“This is between the White House and Senate Leadership,” NLRB spokesman Edwin Egee told Bloomberg Law in an e-mail.

There’s also precedent for leaving the minority party’s seats empty—the board operated with only Democratic members for nearly eight months during the Obama administration. Some management attorneys and employer advocacy groups favor that option. They’re urging the White House and Senate leadership to keep the seat open and then pair McFerran’s renomination with another term for Republican member Marvin Kaplan in August.

There’s “no need to fill her seat now as the NLRB can function just fine with three board members,” Semmens said when asked whether McFerran should be renominated.

Others have said the board needs bipartisan membership in order to maintain its political independence and to strengthen its decisions. Without minority party representation on the board, many decisions—and possibly some new regulations—may be issued without a dissenting voice.

“The Board was designed to have both” labor and management “amply represented in deliberations, and functions best when it does,” Conti said. She added that it’s important for minority members to articulate their views in a dissenting opinion because those may eventually become majority positions.

Then there are the political implications.

“The other reason why you wouldn’t want to keep it open just to keep it open is that you have an election coming up,” Hunter said. “If you leave both seats open, the next president, if it’s a Democrat, then has two vacancies they can immediately fill, and would be able to appoint the board majority within their first year in office.”

To contact the reporters on this story: Hassan A. Kanu in Washington at hkanu@bloomberglaw.com; Robert Iafolla in Washington at riafolla@bloomberglaw.com

To contact the editors responsible for this story: Chris Opfer at copfer@bloomberglaw.com; John Lauinger at jlauinger@bloomberglaw.com

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