Management Memo

On October 26, 2023, the National Labor Relations Board (NLRB or “Board”) issued its Final Rule (the “Rule”) on Joint-Employer status under the National Labor Relations Act (NLRA). Slated to take effect on December 26, 2023, the Rule returns to and expands on the Obama era Browning-Ferris test, scrapping the NLRB’s 2020 Joint Employer test for the sole reason that the current Board disagrees with the 2020 test, and setting up a potential showdown with the Supreme Court over the “major questions” doctrine and the scope of the NLRB’s administrative authority.

The ...

It has been a decision-packed summer at the National Labor Relations Board (“NLRB” or “Board”), and the last weeks of summer were especially active, with a number of significant decisions released at the end of August that could affect employers with non-unionized as well as unionized workforces. The following is a roundup of significant developments, in order of recency:

Board Membership Update: Member Wilcox Confirmed for a Second Term – One Vacancy Remains

On Wednesday, September 6, 2023, the Senate confirmed President Biden’s nomination of Gwynne Wilcox for a ...

The National Labor Relations Board (“Board”) published its final rule (“2023 Rule”) on Friday, August 25, amending the representation election procedures that it previously proposed in 2019 and finalized, after some additional revisions, in 2020 (“2019 Rule”).  Recall that the 2019 Rule had already experienced a significant setback earlier this year.  In January 2023, the D.C. Circuit vacated three substantive changes that the 2019 Rule would have made to the election procedures adopted by the Board in 2014 (“2014 Rule”) while keeping the ...

On August 2, 2023, the National Labor Relations Board (“NLRB” or “Board”) announced a long-anticipated Decision that will affect how employers craft, apply and enforce workplace policies in almost all workplaces, regardless of whether employees are represented by a union. As we anticipated several years ago, the current Board, with a majority of members nominated by President Biden, has now rejected the agency’s 2017 decision in The Boeing Company, in which it adopted a balancing test to evaluate facially neutral employer rules and handbook provisions by examining the nature and extent of their potential impact on employee rights under the National Labor Relations Act (“NLRA” or the “Act”) against legitimate justification(s) for the policies.

The majority opinion in Stericycle Inc. substantively revives the NLRB’s stance on workplace rules as established in the 2004 Lutheran Heritage decision.Under this new framework, any employer’s rule, policy, or handbook provision that  has a “reasonable tendency to chill employees from exercising their Section 7 rights” may be deemed to constitute an unfair labor practice and to be unlawful in violation of the NLRA.

Shocking few NLRB observers, the National Labor Relations Board (NLRB), in The Atlanta Opera, Inc., Case 10-RC-276292, a 3-1 decision issued June 13, 2023, announced its modified standard for analyzing whether  workers are employees or independent contractors of an employer, returning to the test last articulated by the Obama era Board in FedEx II, 362 NLRB 610 (2014), and overruling the Trump era SuperShuttle DFW, Inc., 367 NLRB No. 75 (2019). The new standard is likely to result in findings that more workers unions are seeking to organize and represent are employees and not independent contractors which they would have been found to be under SuperShuttle.

Management-side attorneys and the businesses that they represent will be pleased with the Supreme Court’s holding in Glacier Northwest, Inc. v. International Brotherhood of Teamsters.

The case concerned the issue of whether the National Labor Relations Act, 29 U.S.C. §§ 151–169 (“NLRA” or the “Act”), preempted a state tort claim seeking damages for harm suffered by their employer, caused by employees’ inaction in failing to deliver concrete that had already been loaded into the employer’s trucks or otherwise taking action to prevent the hardening concrete from damaging the trucks, thus intentionally destroying property owned by Glacier. Notably, the striking employees and their union knew that the trucks had been loaded when they began their strike. An eight-justice majority held that the union and its members were, on the facts of the case, not engaged in protected conduct as that term is defined under the NLRA. Justice Barrett delivered the opinion of the Court, in which the Chief Justice and Justices Sotomayor, Kagan and Kavanaugh joined. Justices Thomas, Gorsuch, and Alito concurred. As against this jurisprudentially diverse array, Justice Jackson was the only dissenter.

The National Labor Relations Board (NLRB) has found its first target under recent guidance issued in a memo from its General Counsel claiming that noncompete agreements may violate the National Labor Relations Act (NLRA). According to Bloomberg Law, “[t]he NLRB’s first enforcement action against an employer’s noncompete agreement targeted a Michigan cannabis processor and ended with a recent private settlement resolving the alleged labor law violations.” (The enforcement action predates the guidance memo). Bloomberg obtained redacted documents from the case via a Freedom of Information Act request.

The National Labor Relations Board’s top lawyer, Jennifer Abruzzo, issued  a General Counsel memo today instructing the Labor Board’s Regional Directors of her position  that noncompete clauses for employees protected by the National Labor Relations Act (NLRA) (i.e., nonmanagerial and nonsupervisory employees) in employment contracts and severance agreements violate federal labor law except in limited circumstances. The memo, while not law, outlines her legal theory which she will present to the National Labor Relations Board, which makes law primarily through adjudication of unfair labor practice cases.  The memo instructs the agency’s field offices of the position that the General Counsel is instructing them to take when investigating unfair labor practice charges claiming that such clauses interfere with employees’ rights under the NLRA.

On April 24, 2023, just ten days after Rutgers University faculty ended their week-long strike, Governor Murphy signed bill A4772/S3215 providing workers with increased access to unemployment insurance benefits during labor disputes. The provisions of the bill include:

On Monday, the National Labor Relations Board (the “Board” or “NLRB”), with a majority of appointees by President Biden, i.e., “the Biden-Board,” reversed the short-lived General Motors LLC, 369 NLRB No. 127 (2020) decision and reinstated the Atlantic Steel test for analyzing whether an employee’s grossly unprofessional conduct when engaging in union or other protected concerted activity loses the protection of the National Labor Relations Act (“Act”). The Board issued Lion Elastomers, LLC, 372 NLRB No. 83 (2023) and reinstated Atlantic Steel 245 NLRB 814 (1979) and its progeny, making it more difficult for employers to discipline employees who engage in outrageous, otherwise inappropriate, speech and/or actions in the course of engaging in union or other protected concerted activity.