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Bargaining order inappropriate given changed circumstances, but how employer tried to dissuade unionization unlawful

By Nadine E. Roddy, J.D.

Granting review of an NLRB order, the Second Circuit concluded that substantial evidence supported the Board’s findings the way an employer went about attempting to dissuade employees from voting to unionize, including its reinstatement of Sunday and holiday pay, as well as its demotion of a pro-union employee, violated the NLRA. Even though most components of the Board’s order of remedial relief were enforced, the appeals court denied enforcement of the Board’s bargaining order, explaining that the Board failed to properly account for changed circumstances during the two-year period between the unfair labor practices and its decision, particularly given the significant employee and management turnover and the importance of employees’ free choice (Novelis Corp. v. NLRB , March 15, 2018, Parker, B.).

Organizing activities. The manufacturer of rolled aluminum products employed approximately 800 people, of whom about 600 were eligible to vote in union elections at one of its plants. After management announced that employees would no longer receive Sunday premium pay, and that holiday and vacation days would no longer count toward overtime eligibility, an employee met with the local president of the Steelworkers Union to initiate an organizing campaign. The employee and approximately 25 others conducted organizing activities and ultimately obtained signed union authorization cards from a majority of the eligible employees.

Sunday, holiday pay reinstated. The union requested voluntary recognition from the employer, but two days later management announced it was restoring Sunday and holiday pay, and some employees who had signed authorization cards then requested their return. The employer then declined the union’s request for recognition, and the Union petitioned the NLRB for a representation election. The vote was close; the employer prevailed 287 to 273. Afterward, the organizing employee posted a vulgar message on his Facebook page castigating his fellow workers who had voted against unionization. In response, the employer demoted him.

NLRA violations. The Board found that the employer had engaged in unlawful unfair labor practices by how it had attempted to dissuade its employees from voting for the union. It ordered the employer to cease and desist from the unfair practices and to bargain with the union. Agreeing with the Board’s determination that the employer violated NLRA Sections 8(a)(1) and 8(a)(3), the Second Circuit granted enforcement of most components of the Board’s order of remedial relief.

Restoring benefits. An employer violates Section 8(a)(1) when it confers benefits on employees in an effort to interfere with union organization, as employees are not likely to miss the inference that the source of benefits conferred is also the source of benefits denied. In this case, the employer’s restoration of Sunday and holiday pay was such a benefit. Substantial evidence supported the Board’s finding that the restoration of benefits was motivated by an intention to interfere with the election.

Demotion over Facebook post. Concerning the demoted employee, the court rejected the employer’s contention that the ALJ erred in prohibiting the introduction of evidence about the employee’s supervisory status. The court acknowledged that if the employee were a supervisor, then his Facebook post would not be protected, as Section 8(a)(3) does not protect supervisors. The ALJ had ruled that the employer waived the supervisory defense by failing to plead it as an affirmative defense.

The employer countered that it did plead the affirmative defense when it averred that it “did not take any adverse action against any employee under the Act,” and that this statement is an “obvious reference to the Act’s definition of employee” as opposed to “supervisor.” Affirmative defenses must be specifically pleaded, however, and the Second Circuit was not prepared, on this record, to hold that the ALJ abused his discretion in concluding that the defense was not pleaded with sufficient specificity.

The court was also unpersuaded by the employer’s argument that the demotion was based on the offensive content of the employee’s Facebook post rather than on the post’s possibly qualifying as concerted activity pertaining to the unionization effort. The record simply did not support the employer’s contention that it did not know at the time whether any company employees had expressed support for the post.

Bargaining order. Importantly, however, because the Board did not properly account for changed circumstances at the plant between the time of the unfair labor practices and its decision and order, the court denied enforcement of the bargaining order. A bargaining order is a rare remedy warranted only when it is clearly established that traditional remedies cannot eliminate the effects of the employer’s past unfair labor practices. In prior cases the appeals court had recognized the superiority of, and a preference for, secret ballot elections over bargaining orders. The preference for elections reflects the important policy that employees should not have union representation imposed on them when, by exercise of their free will, they might choose otherwise.

In this case, the Board did not sufficiently account for employee choice. It afforded far too little weight to changed circumstances in determining whether a rerun election would likely be fair when it denied the employer’s motion to reopen the record to introduce evidence of significant employee and management turnover during the intervening two-year period. The law of the Second Circuit is that the relevant circumstances must be measured at the time of the issuance of a bargaining order, and not as of the time of the election. Therefore, enforcement of the bargaining order was denied and the case remanded.