Ambush! NLRB Issues Final Rule on Quickie Elections

On December 15, 2014, a divided National Labor Relations Board (NLRB or Board) published its controversial Final Rule on Representation-Case Procedures (the Rule). The Rule will take effect on April 14, 2015 and is designed to update current NLRB procedures regarding union elections and related representation proceedings. The Rule, which has been in the works for years, reduces the amount of time between the filing of an election petition and the date of the actual election, while imposing additional requirements upon employers during that period and removing several employer-friendly procedural safeguards. The Rule’s major changes are discussed below in detail.

The Majority’s Rationale

Board Chairman Mark Gaston Pearce and Members Kent Y. Hirozawa and Nancy Schiffer approved the Rule. Board Members Philip A. Miscimarra and Harry I. Johnson III dissented. Chairman Pearce said, “I am heartened that the Board has chosen to enact amendments that will modernize the representation case process and fulfill the promise of the National Labor Relations Act (NLRA or Act). Simplifying and streamlining the process will result in improvements for all parties. With these changes, the Board strives to ensure that its representation process remains a model of fairness and efficiency for all.” According to a press release, the Board believes the Rule “will enable the agency to more effectively administer the National Labor Relations Act by modernizing its rules in light of modern technology, making its procedures more transparent and uniform across regions, and eliminating unnecessary litigation and delay. With these amendments, the Board will be better able to fulfill its duty to protect employees’ rights by fairly, efficiently and expeditiously resolving questions of representation.”

Reaction from Business

It is expected that several business groups, including the Coalition for a Democratic Workforce, the National Retail Federation, the National Association of Manufacturers, the US Chamber of Commerce, and the Society for Human Resources Management (SHRM) will challenge the Rule in court. Nancy Hammer, SHRM’s senior government affair policy counsel, issued a statement saying “SHRM feels that the rule improperly focuses on speeding up the time to election at the expense of other important aspects of the National Labor Relations Act, including an employee’s right to access the information needed to make a full and informed choice and an employer’s right to express their views.”

SHRM is also particularly concerned about the requirement that employers provide employees’ personal phone numbers and personal e-mail addresses to unions. “SHRM is very concerned about the potential for misuse of private employee data, the burden on employers to collect and submit the information within the time constraints under the rule, as well as concerns about employer sanctions for unintentional submissions of inaccurate information. SHRM members have expressed great concern about this requirement,” Hammer stated.

Comparison of Current and New Procedures

The NLRB published the following Comparison Table showing the major differences between the current and the new election procedures:

The Dissent

In a long dissent, Board members Miscimarra and Johnson took the majority to task: “The Final Rule has become the Mount Everest of regulations: Massive in scale and unforgiving in its effect. Very few people will have the endurance to read the Final Rule in its entirety.” They offered the following “selective” observations of the Rule:

• Rule’s Primary Purpose and Effect: Union Elections As Quickly As Possible. The Final Rule adopts almost all of what was set forth in the February 2014 Proposed Rule, which in turn was nearly identical to what the Board originally proposed in 2011. There are minor changes, but the Rule’s primary purpose and effect remain the same: Initial union representation elections must occur as soon as possible. The Rule’s defects also remain the same, uncured by the majority’s lengthy discussion, which reflects an awareness of criticisms that are far too often summarily rejected.

• Election Now, Hearing Later. The Rule would impermissibly conduct expedited representation elections before any hearing addresses fundamental questions like who is eligible to vote, thereby resulting in an “election now, hearing later.” This “election now, hearing later” approach was twice rejected by Congress, in amending the NLRA in 1947 and 1959, and is contrary to the statute’s requirement — twice affirmed by Congress — mandating an “appropriate hearing” prior to any representation election.

• Vote Now, Understand Later. The Rule improperly shortens the time needed for employees to understand relevant issues, compelling them to “vote now, understand later.” Regarding these issues, the Rule takes self-contradictory positions that are contrary to common sense, contrary to the Act and its legislative history, and contrary to other legal requirements directed to the preservation of employee free choice, all of which focus on guaranteeing enough time for making important decisions. The Rule operates in reverse, making the available time as short as possible.

• Infringing on Protected Speech. By requiring elections to occur as quickly as possible, the Rule curtails the right of employers, unions, and employees to engage in protected speech. We believe this infringement on protected speech is impermissible, but even if it is within the Board’s authority, it is ill-advised and poorly serves the Act’s purposes and policies.

• Lack of Need for the Rule. The Rule leaves unanswered the most fundamental question regarding any agency rulemaking, which is whether and why rulemaking is necessary. Objective evidence demonstrates that the overwhelming majority of existing elections occur without any unreasonable delay (substantially more than 90 percent of elections occur within 56 days after petition-filing). Although a small number of elections involve more time, this is not a rational basis for rewriting the procedures governing all elections. The Final Rule does not even identify, much less eliminate, the reasons responsible for those few cases that have excessive delays.

• Due Process. The Rule greatly accelerates all deadlines associated with representation elections; it selectively imposes on employers the duty to submit a comprehensive written position statement seven days after notice of a petition-filing by a union; it permits post-submission “amendments” only in narrow circumstances; the new “pleading” requirements, while facially neutral, will in practice weigh far more heavily on employers than on unions attempting to organize nonunion employees; the Rule directs the exclusion of evidence regarding important election issues; and it directs hearing officers in most instances not to permit post-hearing briefs (which, currently, adds a mere seven days to the pre-election timetable); and it codifies and places increased reliance on private consultation and decisionmaking between hearing officers and regional directors, conducted off the record (and thus precluding review by the Board, especially regarding matters that are deferred or excluded from the hearing). In our view, these changes are fundamentally unfair and will predictably deny parties due process by unreasonably altering long established Board norms for adequate notice and opportunity to introduce relevant evidence and address election-related issues.

• Improperly Diminishing the Board’s Role. The majority not only rewrites nearly all procedures governing elections, it eliminates any mandatory role for Board members in resolving post-election questions that arise from the Rule (relegating this to regional directors and to the courts, with only discretionary and post-election review by the Board). The Final Rule articulates no necessity for a “hands-off” policy of Board non-involvement in post-election cases, which we believe is irreconcilable with the statute’s requirement that the Board “in each case * * * assure to employees the fullest freedom in exercising the rights guaranteed by this Act.”

• Disclosures and Employee Privacy. The Rule imposes new mandatory disclosure requirements obligating employers to disclose personal contact information of unit employees, including all personal email addresses and cell phone numbers in the employer’s possession. However, the Rule’s justification for these expanded disclosure requirements (the importance of personal email and cell phones to protected concerted activity in the workplace, given the “prevalence” at “work” of “cell phones,” which have become “the preferred mode of communication for many young people”) is irreconcilable with Purple Communications, 361 NLRB No. 126 (2014), where the Board majority insists that “social media, texting, and personal email accounts” are not even “germane” because they “simply do not serve to facilitate communication among members of a particular workforce” (emphasis added). Moreover, the Final Rule adopts the expanded disclosure requirements without any employee “opt-out” right regarding such information. The Rule even rejects privacy-enhancement measures as simple as requiring an “unsubscribe” link in election-related texts and emails, notwithstanding the current widespread use of such measures in other third-party communications.

• The Consensus Path Not Taken. Most disappointing is the Rule’s failure to incorporate reforms that could have had unanimous Board member support, and substantial support among practitioners, scholars, and advocates for employees, unions, and employers. We favor (i) making representation procedures more effective; (ii) having most representation elections occur at least within 30 to 35 days after petition-filing; (iii) changing the Board’s internal procedures so virtually all elections — disputed or not — would occur within 60 days after petition-filing; and (iv) adopting stricter, more expansive remedies for unlawful election conduct.

Conclusion

It will be interesting to see if the Rule survives the judicial, and perhaps even legislative, challenges it may face. If you have any questions about the Rule, please contact the authors of this post or the Arent Fox professional who handles your matters.