Thursday, October 30, 2014

Inflatable Rats And The First Amendment

In a Decision dated October 27, 2014, the United States District Court for the Eastern District of New York (Bianco, J.), refused to ban a Union from using inflatable rats to communicate its objections to the hiring by an Employer of a supervisor who had run a non-union business previously. The Union, Asbestos, Lead, and Hazardous Waste Laborers' Local 78, began displaying the inflatable rats at various worksites of the Employer, Microtech Contracting Corporation. The case is Microtech Contracting Corporation v. Mason Tenders District Council of Greater New York, et al., Case No.: 14-CV-4179.

The Employer brought suit against the Union and sought a preliminary injunction.  The Court refused to issue the injunction and held that use of the inflatable rats did not violate the no-strike provision of a collective bargaining agreement (the “CBA”) between a contractor’s association and the Union; the employer was a member of that association and was bound by the terms of the CBA. 

In refusing to grant the injunction, the Court held that the Norris-LaGuardia Act of 1932 deprives federal courts of jurisdiction to issue restraining orders or injunctions in cases involving or growing out of labor disputes, except where the strike violates an express or implied promise not to strike, and where the underlying issue is arbitrable. The Court held further that preventing the Union from using the inflatable rat would violate the Union’s First Amendment right to free speech.

The no-strike provision contained in the CBA prohibits “strikes, walkouts, picketing, work stoppages, slowdowns, boycotts or other disruptive activity of a similar nature at a job site of or otherwise directed at, any employer [emphasis added].” Although the Court stated that First Amendment rights can be surrendered in a CBA or some other contractual agreement, it held that the Union did not waive those rights in this case.

The Court held that use of the inflatable rats did not constitute “disruptive activity” under the no-strike provision because that term was qualified by the words “of a similar nature.” In the Court’s view, that qualification refers to activities similar to strikes, walkouts, picketing, work stoppages, slowdowns, or boycotts, but not to the use of an inflatable rat to publicize or otherwise broadcast objections to an employer’s business practices.  It appears that if the words “of a similar nature” were not contained in the clause, then use of the rats may have been prohibited as violative of the CBA.  Interestingly, the Court stated that even if use of the rats were prohibited by the no-strike provision, the dispute was not subject to the grievance clauses in the CBA because it did not involve an "interpretation and application" of the agreement.  Rather, it involved the Union's objections to the Employer's hiring of a supervisor with a non-union history.

While there is room for disagreement with the Court’s Decision, perhaps, as a practical matter, the Employer should consider use of inflatable “cats” on its jobsites which stand much taller than the Union’s inflatable rats.  After all, free speech is free speech.       

Friday, June 27, 2014

Obama's "Recess" Appointments To NLRB Held Unconstitutional

In a blistering, 9-0 Decision, the United States Supreme Court ruled that President Obama’s recess appointments to the National Labor Relations Board (the “NLRB”) were unconstitutional. The revocation of those appointments, made in 2012, voids hundreds of decisions made by the NLRB.

The President made appointments to the NLRB to fill vacancies when the Senate was in a pro forma session, not in official recess.  The President claimed that although a formal “recess” had not been declared, the Senate was in recess as a practical matter because it was not meeting and conducting business.  The United States Supreme Court disagreed.

During the period in which the NLRB made decisions involving the now invalid appointees,  approximately 600 employers sustained adverse determinations. Each of those determinations is null and void because the NLRB lacked authority to act due to the improper appointments.  Most likely, de novo hearing and review of those vacated decisions will be made by a reconstituted NLRB.  Those revised decisions, made by persons appointed in accordance with the law (rather than in violation of it), may result in different outcomes. Of course, spending so much time to rehear and redetermine those cases may strain NLRB resources; it could affect adversely the processing of current cases and throw a monkey wrench into the NLRB’s heretofore pro-labor agenda. The former result is troubling, while the latter is encouraging.

To paraphrase an old television commercial ... it’s not nice to fool with the Constitution.

Thursday, March 27, 2014

NLRB Rules That College Football Players Are Employees And May Unionize

Yesterday, the Chicago district of the National Labor Relations Board (the “NLRB”) ruled that football players at Northwestern University qualify as employees of the university and can unionize.  Certainly, one can extrapolate from the ruling that it applies to all student athletes, not just football players at Northwestern. 

While the players may be rejoicing over their new-found status, they should approach this development with some trepidation.  There are a number of unknown or unintended consequences that could occur as a result of the NLRB ruling.  Colleges and universities may elect to no longer issue scholarships for their athletes, and could avoid allegations of anti-union animus if financial considerations come into play. Indeed, if sports scholarships are discontinued, that will likely affect a great number of individuals who might not otherwise be able to afford an education, but for those  scholarships. If scholarships continue, student recipients could be taxed on all or portions of those scholarships as employee income. Small schools may decide to cancel their sports programs completely. Student athletes who are hurt in a game or in activities related to their participation in the sport may qualify for workers’ compensation benefits. 

Also, unionization raises the prospect of strikes by disgruntled players and lockouts by athletic departments. Strikes and lockouts are particularly likely since the athletes may lack any real leverage at the bargaining table; this could result in the utilization of non-union replacement players.    
The NLRB ruling applies solely to athletes at private schools because the NLRB lacks jurisdiction over public universities.  I expect that Northwestern will appeal and that the matter will be decided ultimately by the United States Supreme Court.  In the interim, due to potential litigation, it is likely that the matter won’t be finalized for years. Stay tuned. 

Wednesday, January 1, 2014

New York Increases Minimum Wage

Effective as of December 31, 2013, New York State has increased its minimum wage to $8.00 per hour.  This is the first of three planned increases.  The New York minimum wage will again increase on December 31, 2014 to $8.75 per hour, and will further increase to $9.00 per hour on December 31, 2015.  Note that the current federal minimum wage is $7.25 per hour, but that New York employers must  pay the higher of the two rates.  New York employers are required to post notice of the current increase in the State's minimum wage in a conspicuous place.  The poster from the NYS Department of Labor can be found here.

Happy New Year!

Wednesday, July 3, 2013

Delay Of Employer Penalties Under Obamacare

The Treasury Department has announced that the imposition of employer penalties under Obamacare will be delayed until 2015. Initially, those penalties were scheduled to become effective as of January 1, 2014. The delay applies only to the employer penalty provisions and certain related reporting requirements. Implementation of the health care exchanges as well as the mandate for individual health care coverage (including penalties for the failure to obtain such coverage) remain unaffected; they are still scheduled to become effective next year. 

The delay in implementation came about because of complaints from employers that Obamacare penalty provisions were too complex to enforce by the initial 2014 deadline, and there was a lack of guidance regarding several issues.   To somewhat paraphrase Nancy Pelosi ... Now that we know what's in the legislation, it's not all that it's cracked up to be.  Rushing to enact legislation without reading it first is a recipe for disaster. This may be the first of many delays in the implementation and enforcement of Obamacare.  Stay tuned. 

Wednesday, September 12, 2012

Amendments To Employee Wage Deductions In New York

New York's Governor Cuomo has signed legislation amending New York Labor Law §193 which restores to employers the ability to make certain deductions from employee wages in a number of instances; the New York Department of Labor (the “NYSDOL") had determined previously (via opinion letters) that such deductions were impermissible, even with the employee's consent. The legislation becomes effective on November 9, 2012.

The new amendments allow New York employers to make deductions (in addition to those existing currently under the statute) with respect to pay advances; accidental overpayment of wages; purchases made at events sponsored by bona fide charitable organizations; discounted parking passes and mass transit vouchers; gym membership dues; cafeteria, vending machine and pharmacy purchases made at the employer's place of business; tuition, room and board and fees for educational institutions; day care expenses; and payments for housing provided at no more than market rates by nonprofit hospitals.

Before an employer may take any of these additional deductions, the employer must: (i) provide the employee with written notice of the terms and conditions of the payment and its benefits; (ii) provide a written explanation of how the employer will take the deductions; and (iii) obtain the employee’s written, voluntary consent to the deduction. The employee’s consent may be revoked at any time. The employer must retain each authorization for at least six (6) years following the termination of the employee’s employment. Employees may also consent to a deduction through a collective bargaining agreement.

Interestingly, the amendments contain a "sunset provision" that automatically extinguishes the newly identified wage deductions on November 9, 2015. Accordingly, the State Legislature will likely revisit this issue at a later date to determine whether the new law is working; if it is, the "sunset provision" may be revoked.

The NYSDOL is required to issue regulations governing the timing and frequency of deductions and notice requirements, including a procedure that the employee may use to dispute the amount of the deduction. Employers are cautioned that they may wish to wait until after the NYSDOL issues its regulations, and the effective date of the new legislation, before entering into any wage deduction agreements with employees or taking any action with respect to wage deductions not permitted by statute currently.

Thursday, May 17, 2012

Retaliation Claim Dismissed As Not Related To Title VII Proceeding

In a case of first impression, the Second Circuit Court of Appeals held that the termination of employment in connection with an internal company investigation was not retaliatory where an EEOC Charge had not been filed. The case is Townsend, et al. v. Benjamin Enterprises, Inc., et al. and can be found here.

In Townsend, the Plaintiff was the director of human resources for the defendant corporation. Plaintiff alleged that she was terminated after commencing an internal investigation of a sexual harassment complaint made by the co-plaintiff against an officer of the corporation. The corporate officer was a shareholder of the company and owned it with his wife.

At the trial level, the District Court granted Defendants’ motion for summary judgment on the grounds that the Plaintiff was not engaged in protected activity under Title VII since an EEOC Charge has not been filed. On appeal, the Second Circuit affirmed and held that participation in an internal employer investigation not connected with a formal EEOC proceeding does not qualify as protected activity.

In reading the Second Circuit's decision, I can't help but believe that it will have a chilling effect on internal investigations concerning discrimination. If the investigator is not protected from retaliation where the investigation gets "too close to home," vigorous internal efforts to discover and remedy unlawful discrimination likely will suffer.