An important first step to prepare for the NLRB's new election rules is to take the time to examine your workforce and identify who is a supervisor and who is not a supervisor.

See our updates on the notice-posting rule:

Federal Court Rules NLRB's Union Posting Rule Unlawful

D.C. Circuit Enjoins NLRB's Posting Rule, Pending Appellate Proceedings

On April 30, 2012, two National Labor Relations Board (NLRB) rules will come into effect that, like the National Labor Relations Act (NLRA) generally, will affect all employers engaged in interstate commerce and not part of the rail or air transportation systems. This definition includes most private-sector employers — employers should consult with counsel if they believe that they may be exempted from the jurisdiction of the NLRB.

Notice-Posting Requirement

First, by April 30, 2012, covered employers will be required to post a notice informing their employees of their right to engage in union and other concerted activity. With few changes, the NLRB has adopted the poster ordered by President Obama to be posted by all federal contractors (Executive Order 13496). Employers who are subject to the jurisdiction of the NLRB and are federal contractors will not be sanctioned by the NLRB if they continue to use the poster required by the Executive Order and will not be required to post a second poster.

The poster notifies all employees that they have the legally protected right to:

• Organize a union to negotiate with their employer concerning wages, hours and other terms and conditions of employment;
• Form, join or assist a union;
• Bargain collectively through a union for a contract that sets wages, benefits, hours and other working conditions;
• Discuss their terms and conditions of employment or union organizing with co-workers or a union;
• Take action with one or more of their co-workers to improve their working conditions by, among other means, raising complaints with their employer or government agency or seeking help from a union;
• Strike or picket their employer to obtain improved terms of employment or working conditions; and
• Refrain from doing any of the above.

The poster also informs employees that the law prohibits their employer from interfering with the exercise of their rights or discriminating against them because they engage in or refuse to engage in union activity. Various types of violations, both employer and union, are listed in the poster. Employees are also given the necessary instructions for filing a charge with the NLRB alleging a violation of the Act and are informed that anyone, not just an employee, may file a charge. Posters must be posted in the place where the employer posts other government notices (e.g., FLSA, Title VII and similar types of notices). If 20 percent or more of an employer's employees communicate in the same language that is different from English and have difficulty understanding written English, the employer must obtain from the NLRB website a poster in that other language and post it in addition to the one that is in English.

Employers that customarily communicate personnel rules electronically by postings on an intranet or Internet page must post the poster in the same manner. The posting does not have to be done by email or other forms of electronic communications.

What This Means for Employers

Employers who fail to post the poster will receive first a letter instructing them to post the notice. If the employer does not respond to the letter, it is unclear what next steps would be available to the NLRB. The language of the notice-posting rule would permit the NLRB to find the employer in violation of Section 8(a)(1) of the National Labor Relations Act, subject the employer to both cease-and-desist and remedial orders, and, in some cases, to toll the six-month statute of limitations for the filing of an unfair labor practice charge. However, a recent decision in the District of Columbia addressing the notice-posting rule found that the NLRB exceeded its authority in implementing these penalties. In essence, the court concluded that the Board exceeded its authority in declaring the failure to adhere to the posting rule would always constitute "interference" with an employee's rights under the NLRA (that is, an unfair labor practice). The court similarly found that the NLRA "does not authorize the Board to enact a rule which permits it to toll the statute of limitations in any future unfair labor practice action involving a job site where the notice was not posted." Tolling cannot be automatic — rather, the appropriateness of tolling must be proven by the NLRB. As a practical matter, with the limitation of its enforcement measures, it seems that the NLRB cannot find an independent unfair labor practice if an employer fails to post the notice. Nevertheless, it also seems that an employer's failure to post the notice could be considered as part of the facts and circumstances the NLRB relies upon to determine whether certain unfair labor practices have occurred. We will provide further updates as more courts address the notice-posting rule.

Changes to Representation Election Procedures

Second, the NLRB will implement a series of changes to its union representation election procedures. Specifically, the following issues are affected by the changes:

Defining the Scope of the Pre-Election Hearing. When parties cannot agree as to election terms, the NLRB conducts a pre-election hearing to determine whether an election should be held. The new rules explicitly state that the purpose of a pre-election hearing is to determine whether a question of representation exists, and give the hearing officer the discretion to limit the hearing to relevant matters. This change will eliminate the right to raise issues such as the supervisory status of some putative unit members.

Limiting Post-Hearing Briefs. The new rules provide hearing officers the discretion to control the filing, subject matter and timing of any post-hearing briefs. This change will eliminate briefing by the parties as a matter of right.

Consolidating Pre- and Post-Election Appeals. Currently, parties must file one appeal to seek Board review of pre-election issues and a separate appeal to seek Board review of post-election issues, such as challenges to voter eligibility and objections to a party's conduct during the course of the election. This amendment consolidates the two appeals into a single post-election procedure. This change will also eliminate post-election review as a matter of right.

Eliminating the 25-Day Waiting Period. The new rules remove the 25-day waiting period after a regional director's pre-election decision issues previously allotted for the disposition of pre—election appeals. Because the new rules eliminate pre-election appeals, the waiting period no longer serves any purpose.

Establishing a Standard for Interlocutory Appeals. The current rules fail to establish any standard for the filing of interlocutory appeals concerning individual rulings by hearing officers or regional directors during the course of a pre-election hearing. In the past, parties have been able to file several appeals in a single case regarding discrete rulings as to what evidence may, or may not, be permitted. The new rules make clear that the Board will grant such interlocutory appeals only under "extraordinary circumstances where it appears that the issue will otherwise evade review."

Establishing Standards for Post-Election Procedures. The new rules codify a practice in which regional directors decide challenges and objections to elections through an investigation, without a hearing, when there are no substantial or material factual issues in dispute. The amendment also makes Board review of the regional directors' decisions discretionary. This change will require parties to identify significant prejudicial error by the regional director or some other compelling reason to attain Board review.

What This Means For Employers

While these changes are likely to present many issues for employers facing union election campaigns, an important first step to prepare for the NLRB's new election rules is to take the time to examine your workforce and identify who is a supervisor and who is not a supervisor. Because employers will no longer be assured of an opportunity to address the supervisory status of employees through a pre-election hearing, employers must be confident in their identification of supervisors, because on one hand, incorrectly telling employees that they are supervisors who cannot participate in union organizing constitutes objectionable pre-election conduct, and on the other hand, using "supervisors" who turn out to be employees to communicate the employer's message may also be deemed coercive pre-election conduct.

This point is best illustrated by a recent case brought before the NLRB and appealed to the U.S. Court of Appeals for the District of Columbia Circuit. In Veritas Health Services Inc. v. NLRB, Case No. 11-1107 (D.C. Cir. March 13, 2012), a union sought to organize the nurses employed by Veritas. In early 2010, the union commenced a campaign to represent the nurses at the employer, and it needed cards authorizing representation from 30 percent of the employees. The union contacted both registered nurses and charge nurses, and several charge nurses signed authorization cards, met with union representatives, attended union meetings, according to the opinion. Some even encouraged subordinate registered nurses to support the union.

The union petitioned the NLRB in February 2010 to hold an election, after it collected the necessary cards, and the election was set for April. On March 5, 2010, the parties stipulated that the charge nurses were supervisors under the NLRA and that they therefore could not vote in the election. The charge nurses then ceased their pro-union activities, and some encouraged registered nurses not to support the union. However, the union still won the representation election despite the reversal in position by the charge nurses.

Both the NLRB and the D.C. Circuit rejected the employer's contention that the charge nurses' pro-union conduct had tainted the election by coercing and interfering with the free choice of the registered nurses they supervised, saying their later behavior mitigated their original pro-union acts. However, had the situation been reversed — that is, had the charge nurses been considered supervisors acting on behalf of management to discourage support for the union, only to later endorse the union after being deemed eligible to vote in the representation election as members of the bargaining unit — the union, were it to have lost the election, may well have been able to persuade the NLRB to set aside the election on grounds of employer misconduct.

Employers should consider developing campaign materials that can be rapidly deployed and a strategy for using those materials in the event of a union organizing drive. These materials should address the benefits already available to employees, the costs of union representation to employees, and the employer's belief that its employees would be better off without the union. Because the pre-election period may be dramatically reduced, employers will have less time to react to an organizing drive and must be ready to enter campaign mode instantly.

In addition to identifying supervisors, as discussed above, employers should consider training their supervisors now about how to respond to employee inquiries regarding unions and their perceived benefits. Well-trained and knowledgeable supervisors will be better able to detect the early signs of organizing and more capable of taking the actions necessary to potentially neutralize any interest some employees may have in third-party representation.

About the Duane Morris Institute

Learn more about the implications of this ruling and other actions being taken by the NLRB impacting both union and non-union employers during the Duane Morris Institute webinar "Are You Prepared for the 'Union Spring' of 2012?" to be held on May 9, 2012.

For Further Information

If you have any questions about this Alert or would like assistance drafting or reviewing arbitration agreements, please contact any of the attorneys in our Employment, Labor, Benefits and Immigration Practice Group or the attorney in the firm with whom you are regularly in contact.

Disclaimer: This Alert has been prepared and published for informational purposes only and is not offered, nor should be construed, as legal advice. For more information, please see the firm's full disclaimer.