CHAPTER 4

Union Shops

Employers frequently ask what can be done to avoid union efforts to organize their workforce? The answer is easily stated although its fulfillment will undoubtedly require sustained effort and ongoing vigilance by the employer. The answer is as follows: At all times treat the members of your workforce with dignity and respect and reward their labor with fair wages and fringe benefits. There is an old adage in labor relations that states, “An employer gets the union it deserves.”

A BRIEF SUMMARY OF THE HISTORICAL BACKGROUND OF COLLECTIVE BARGAINING AND LABOR UNIONS

One highly regulated area of employment law concerns specialized contracts of employment referred to as “collective bargaining agreements” existing between employers and labor unions.

The history of federal labor laws was extremely turbulent and evidences many hard-fought battles between employers and trade unions in both the federal courts and Congress along the difficult journey to a framework of federal laws and court cases. Numerous laws were enacted for the purpose of regulating the relationship between employers and unions. These laws include the Wagner Act of 1935, Taft-Hartley Act of 1947, and Landrum-Griffin Act of 1959.

During the nineteenth century, the forces of labor and management met on a decidedly imbalanced playing field as labor fought to improve wages and working conditions for workers on the one hand while employers sought to maximize retention of profits and control on the other. Union efforts to improve the economic welfare of the workforce, however, were met with formidable resistance from federal courts. This included, among other things, use of (a) criminal prosecution claiming that unionization interferes with and restrains trade and (b) orders by judges who were not friendly toward labor unions that prohibited strikes, picketing, and product boycotts. Employers were able to use court orders known as injunctions to prevent union activity. These orders were very effective, because they were speedy, and violating them could subject the individual to criminal prosecution.

IN PLAIN ENGLISH

Product boycotts involve situations where employees would advise everyone they communicated with that the identified product should not be purchased because it was created by employees who were not paid fair wages for the work they did. It was hoped that the employer would realize reduced sales and agree to increase wages in order to be able to increase sale of those products.

IN PLAIN ENGLISH

An injunction is a court order that prohibits an individual or group of individuals from doing something, and if the individual or group does not comply with the order, the individual or group could be criminally prosecuted.

Employers were also successful in preventing union activities by filing lawsuits claiming that the union activity was unlawful. Federal antitrust statutes, including the Sherman Act of 1890 and Clayton Act of 1914, provided still further obstacles to union activities. These laws were used by employers to control wages, continue the working conditions the unions were attempting to change, and to subject the unions to significant economic penalties. The irony is that those laws were created with the purpose of controlling employers and not for their benefit.

Eventually, judges changed their attitude toward unions, and many judges became less willing to issue and enforce injunctions against labor unions. The US Congress also began to be sympathetic to the needs of labor unions, and laws were passed to protect the rights of employees. Timing was also favorable to changes in national labor relations policies as the twilight years of the nineteenth century witnessed economic recession and the dawn of the twentieth century revealed the horrors of the First World War. The resulting National War Labor Board introduced the principle of employee freedom to organize in and bargain collectively with employers through trade unions free from employer interference. In 1898, the Erdman Act introduced to the railroad industry principles for the peaceful resolution of disputes through third-party mediation and conciliation efforts, a prohibition against termination from employment for union membership, and the outlawing of so-called “yellow dog contracts,” forbidding employees from joining unions. In 1908, the US Supreme Court declared the Erdman Act to be unconstitutional. The Railway Labor Act of 1926 containing similar protections was born, and was eventually upheld in 1930 by a more progressive majority of the Supreme Court.

IN PLAIN ENGLISH

Mediation is a process whereby an independent person who acts neutral, like a referee, assists the employer and the union in working out an acceptable resolution of any dispute they have between them. The mediator does not make any decisions; instead, the mediator merely assists the parties in working out their differences. Conciliation is sometimes used instead of mediation and, in some situations, conciliation is used to define the process of mediation.

The early decades of the twentieth century also witnessed dramatic changes in federal legislation by a more worker-friendly Congress with the goal of protecting the rights of labor to organize and engage in concerted activities to improve the wages and working conditions of workers. The Norris-LaGuardia Act of 1932 declared as public policy that employees were permitted to organize and bargain collectively, free from employer coercion and sought to achieve that goal by regulating, and in most cases, prohibiting issuance of injunctions in a “labor dispute.” Peaceful strikes, picketing, and boycotts were thus sheltered from the injunction in most cases and in those limited instances where injunction was appropriate the length was limited, a trial by jury was guaranteed for issuance of an early injunction and the judge who issued the injunction was prohibited from presiding over any later proceedings for violation.

Until the mid-1930s, however, Congress applied a more hands-off policy toward the often-combative conflicts between unions and employers, with each side left to their own economic weapons to bring pressure to bear upon their opposition. For unions, that economic pressure came in the form of the strike and picketing of the employers’ premises. For employers, that economic pressure was discharging striking workers and locking them out of the employer’s premises. This hands-off approach, however, inevitably led to highly emotional and combative conflicts between labor and management that often escalated quickly into outright physical violence and bloodshed.

With the Wagner Act of 1935, often referred to as the National Labor Relations Act (“NLRA”), however, Congress began to take a more proactive and rational approach to a national labor relations policy. NLRA declared as federally protected “the right to self-organization, to form, join, or assist labor organizations, to bargain collectively through representatives of their own choosing, and to engage in concerted activities for the purpose of collective bargaining or other mutual aid or protection.” NLRA also declared illegal certain employer acts, known as “unfair labor practices” such as restraint, interference, or coercion of employees in the exercise of their rights to organize. The NLRA also restricted employers by prohibiting discrimination in terms of employment so as to discourage union membership and the employers’ refusal to bargain in good faith with the majority employee representative.

NLRA unfair labor practices were furthermore to be monitored through judicial-type proceedings before a newly created three-member (later expanded to five members) National Labor Relations Board (“NLRB”). The NLRB was further charged with authority to conduct secret-ballot elections for purposes of a group of common interest employees (“a bargaining unit”) and selecting a labor organization to represent them for purposes of dealing with their employer. The NLRA ultimately withstood constitutional challenge and was approved by the Supreme Court in NLRB v. Jones & Laughlin Steel Corp.

With the enactment of the NLRA came a dramatic rise in union membership, increased union awareness and power, collective bargaining, and increased strikes. Unfortunately, the increase in union activity was also accompanied by a degree of corruption and undemocratic practices in internal union affairs. As union activity increased, the NLRB became more active by aggressively pursuing employers with claims for unfair labor practices.

IN PLAIN ENGLISH

“Collective bargaining” is defined as negotiations by groups of employees for salaries, other benefits, and working conditions.

The rise in unionization resulted in pushback from Congress and in the passing of the Taft-Hartley Act of 1947. This Act separated the criminal and civil processes in labor relations. The Office of General Counsel is responsible for handling the criminal proceedings and the NLRB itself is responsible for handling the civil or administrative proceedings. The Taft-Hartley Act impacted employers and supervisors in several ways, such as excluding supervisors and independent contractors from NLRA coverage, adding additional free speech protections for employers, and prohibiting employers from requiring union membership prior to hiring (this is referred to as the “closed shop”). The Taft-Hartley Act also impacted employees and unions as well by providing employees with the right to decline joining the union process. This act also granted the US Court of Appeals greater authority to review NLRB findings and remedies.

In 1959, the NLRA was again amended by the Landrum-Griffin Act to address corruption within union leadership by requiring elaborate reporting requirements to the US Department of Labor and a “bill of rights” for union members covering such matters as internal union elections, eligibility for internal union offices, and union disciplinary procedures.

With this historical overview in mind, we will now turn to the subject of union access to the employer’s premises for the purposes of unionizing employees.

CAN AN EMPLOYER’S PROPERTY BE LAWFULLY ACCESSED FOR PURPOSES OF TRYING TO UNIONIZE?

It may come as a surprise to some employers that the answer to the above question is generally “yes.” Questions concerning union access to employer’s property for purposes of exercising rights under the NLRA, however, are complex and often very fact specific. Any employer considering preparing and spreading a “no union solicitation rule” on its premises would therefore be well advised to first discuss the matter with a competent attorney familiar with this area of labor law. Similarly, union organizers should become familiar with this area of the law when faced with an employer’s “no union solicitation rule” in order to properly comply with legal requirements. The following brief overview of this area may prove helpful when discussing these issues with your attorney or within the union.

Access to an employer’s premises for purposes of employee solicitation on behalf of a union may potentially occur by either: (1) an employee of an employer who is a union supporter during working or nonworking hours; or (2) a nonemployee of the employer such as a professional organizer employed by a union. Whether it is legal for an employer to refuse to grant this type of access under each circumstance depends on the below factors. We will first discuss access by an employer’s own employees for union solicitation purposes.

SOLICITATION BY EMPLOYEES OF THE EMPLOYER

Whether an employer is required to allow employees on their property for the purpose of promoting a union depends on a balancing of the competing interests of (a) NRLA rights that outlaw employer interference with employee organized activities on the one hand and (b) the employer’s interests in imposing limitations on the time and manner in which employees may solicit on behalf of a union.

An employer will usually announce a “no solicitation rule” prohibiting employee promotion of a union or from handing out pro-union literature on its premises by threatening discipline either in advance of or in the midst of a union election campaign. In 1945, the US Supreme Court declared such a rule to be invalid, though there were some exceptions. Under the Supreme Court’s analysis, it does not need to be proven that the employer’s rule against promoting a union actually interfered with a union’s ability to communicate with the employee. The Court also found that it did not need to be proven that the employer’s reason for having such a rule was to intentionally discourage union efforts in its workforce. Such a rule is presumed to be an unreasonable obstacle to unionization and, therefore, discriminatory in the absence of evidence that special circumstances make the rule necessary in order to maintain production or discipline.

To comply with the Supreme Court’s ruling, however, care must be taken in the no-solicitation rule to distinguish between “working hours” and “working time.” While the term “working hours” is normally understood to apply to all time between when an employee “clocks in” at the beginning of their work shift and “clocks out” at the end of their workday, “working time” applies only to those hours when the employee is actually engaged in the performance of work. An employer’s general ban against solicitation during all “working hours” (which would include both breaks and lunchtime) will be found to be automatically in violation of the prohibition against “restraint, interference, or coercion,” while a more specific restriction only against solicitation during times when work is actually being performed would not run afoul of the NLRA unless it is communicated or applied in such a way that it affects employees on the times mentioned above. An employer can overcome the above restrictions if the rule is necessary for efficiency, safety, or discipline. One example is when the employer produces aircraft and spacecraft. Another exception is in retail businesses where the rule prohibits employees from engaging in union solicitation in places where there may be customers, such as the sales floor, elevators, or stairways.

Also regarding the area of solicitation on the employer’s property, an employer’s no-solicitation rules prohibiting all distribution of union literature (i.e., pamphlets) in working areas including those times when no work is being performed is more allowable than oral solicitation provisions due to the potential creation of litter and the relative ease with which employees can carry leaflets to nonworking areas for distribution and perusal during nonworking times. A blanket no-distribution ban on such literature will, however, be presumed illegal if it applies to nonworking time and to areas on the employer’s premises, such as a company parking lot, which are other than areas where work is actually performed.

The presumed validity of no-solicitation rules concerning working time, however, may be overcome by the NLRB’s General Counsel when there is specific proof the rule was adopted for discriminatory purposes with a specific desire to inhibit union communication with employees. If an employer permits working-time solicitation to other organizations, such as for athletic events or charities, or permits solicitation of an anti-union nature, it will be deemed to evidence a discriminatory motive and any presumed business rationale for the employer’s no-solicitation policy will thus be seriously undermined.

The timing of the announcement of no solicitation rules by itself, however, is irrelevant. While the presumed validity of a “no-solicitation during work time” rule will not be overcome simply by the timing of its announcement or reactivation, a case for unlawful discrimination due to the timing of the rule may be reinforced by other employer unfair labor practices or permission granted to other entities to engage in solicitation. The burden will then shift to the employer to establish that the no solicitation rule is necessary for production or discipline.

Union Pins and Buttons

The wearing of union pins or buttons also falls within the domain of no-solicitation rules. The wearing and display of such items by employees are treated as protected activity. Unlike no-solicitation rules, however, even when the employer’s ban against wearing such pins and buttons is limited to hours when work is actually being performed and not to all working time, there is no presumption of the rule’s validity and the burden is on the employer to demonstrate that special circumstances warrant interference with those protected activities such as when specific words on a union button provoke other employees to serious anger, will affront the employer’s customers, or distract employees from tasks requiring substantial concentration.

Evidence concerning the employer’s permission to allow employees to wear other pins and only disallow the wearing of union pins may serve as further evidence of discrimination against the union and thus unlawful interference.

Collective Bargaining Agreements’ Relaxation of NLRA Protections Concerning No-Solicitation Rules

Contractually agreed upon no-solicitation rules may be denied enforcement by the NLRB when doing so would effectively permit the current union to waive the right of employees campaigning for a competing union or against unionization altogether. This rule concerning contractually agreed no-solicitation rules has also been extended to the distribution of campaign literature during nonworking time and nonworking areas by candidates for the union election of officers.

Some unions have attempted to invoke the Supreme Court rule regarding the presumption of illegality of no-solicitation rules under circumstances where employees who are not working return to the employer’s property and attempt to solicit on behalf of the union employees who are working but on their breaks or lunchtimes. Such attempts have been rejected by both the NLRB and one federal court of appeals. These attempts by off-duty employees were regarded as similar to that of a nonemployee and therefore can be excluded without reason from the employer’s property during their nonworking time.

NONEMPLOYEE SOLICITATION ON BEHALF OF UNIONS

While the above outlines the rules concerning employee solicitations on behalf of unions, it should be noted the rules concerning nonemployee solicitation have been far more restrictive. Thus, the Supreme Court concluded:

It is our judgment . . . that an employer may validly post his property against nonemployee distribution of union literature if reasonable efforts by the union through other available channels of communication will enable it to reach the employees with its message and if the employer’s notice or order does not discriminate against the union by allowing other distribution.

Later decisions, however, have held that in those instances where it is not practical to promote the union to employees off company premises because of the employees’ location, the employer is required to open its premises to nonemployee union organizers under reasonable conditions. Such has been applied to (1) a remote logging camp or a mining camp on a distant island, (2) sailors aboard shipping tankers, and (3) mountain-resort employees who spend both working and nonworking time on the employer’s premises. Once again, however, if the employer prohibits access to its premises only to nonemployee union organizers but permits other nonemployees (such as groups promoting recreational activities, political groups, or charitable organizations, etc.) upon its property to solicit or communicate for other nonunion purposes, the presumed validity of the exclusionary rule is defeated.

While unions have attempted to find constitutionally protected free speech rights in instances where nonemployee union organizers solicit employees on employer property, those efforts have proven unsuccessful. It may thus be concluded that with the limited exception of “company towns,” any asserted right of both employees and nonemployees to solicit on employer property cannot be based on federal Constitution guarantees to free speech but must instead be based on the above analysis of the NLRA and any accommodation between employee rights under the NLRA and the property rights of employers.

IN PLAIN ENGLISH

While there are only a few towns that are exclusively for a company, they do exist. These are towns which are owned by the company. All of the stores and amenities are owned and maintained by the company. Only company employees live in those towns.

CAPTIVE AUDIENCE SPEECHES

It should be added that employers may lawfully assemble its employees on its premises during working hours for purposes of delivering an anti-union address to them, referred to as “captive audience” speeches. Unless the employer’s no-solicitation rule is unlawfully overbroad to include forbidding union solicitation during nonworking time during working hours such as during employee breaks and lunches, an employer does not commit an unfair labor practice by denying a union’s request for an “equal time” opportunity to reply. Moreover, an employer’s denial of equal time is ordinarily presumed to be lawful even though the employer’s solicitation is forced and unlawful (and thus subject to remedy though the filing of an unfair labor practice). If the NLRB’s General Counsel can demonstrate the union is seriously incapacitated from reply communications to employees through alternative means, then the employer’s denial of equal time is unlawful.

ACCESS TO THE NAMES AND ADDRESSES OF AN EMPLOYER’S EMPLOYEES

Finally, on a topic related to union access of the employer’s premises, the NLRB held that within one week of the agreement upon or the ordering of a representation election, the employer is obliged to furnish to the NLRB for transmittal to the union the names and addresses of all employees eligible to vote in the election.

HYPOTHETICAL EXAMPLE

The following hypothetical is provided for purposes of illustrating some of the major principles discussed in this chapter.

Floe’s Fabulous Flip-Flops (“FFFF”), based in Fabulous Fairbanks, manufactures casual footwear for women and men at its adjacent plant, which it then sells to customers at its many retail stores throughout the United States, When rumors began to circulate that certain FFFF employees were discussing among themselves taking steps through the NLRB to seek collective bargaining representation from United Sole Workers of America (USW), FFFF’s senior managers announced and distributed to all employees a written company-wide no-solicitation and dress code policy (“policy”) declaring, “No shoes, No socks, and No solicitation!” Among its many prohibitions, FFFF’s new policy strictly forbade employees while at work in either its manufacturing or retail operations from soliciting other employees to join or otherwise support any union efforts to organize FFFF’s workforce during “working hours,” including employee rest breaks and lunch breaks. According to FFFF’s no-solicitation policy, any employee discovered violating the policy would be immediately fired from employment.

TJ, a longtime associate working in FFFF’s Rodeo Drive store, receives a copy of FFFF’s policy. Following conclusion of TJ’s shift that afternoon, TJ visits the offices of NLRB Region 21 in Los Angeles to discuss FFFF’s no-solicitation policy with a member of its General Counsel staff. TJ thereafter initiates a Charge Against Employer, alleging that FFFF’s no-solicitation policy violates NLRA. What would be the probable outcome of the unfair labor practice charge prosecuted by NLRB’s General Counsel against FFFF?

• Consistent with the union access principles discussed above, with regard to employees in its manufacturing facility, FFFF may lawfully announce and distribute the foregoing no-solicitation rule if changed to limited solicitations by employees when work is actually being performed.

• FFFF’s plan, when applied to its manufacturing operations, would also not violate NLRA if it excluded times when employees are not engaged in the actual performance of work duties such as during their rest breaks and meal breaks.

• FFFF’s no-solicitation rule when applied to the distribution of union literature in its factory would not violate NLRA if it prohibited distribution of literature in areas of the plant where work is performed due to hazards created by littering and the relative ease of distribution and perusal by employees of union literature in nonwork areas during nonworking time.

• FFFF’s rule would furthermore not run afoul of NLRA prohibitions regarding solicitation even during nonworking time if applied to its retail operations forbidding employee solicitations while present on the retail floor and in other store areas such as stairways and elevators accessible by customers.

FFFF’s rule prohibiting solicitation on employer premises by nonemployees or employees who are off duty would not violate constitutionally protected free speech rights.

CONCLUSION

By treating members of the workforce with dignity and respect and paying them a fair wage and fringe benefits for their work, there is little incentive for their seeking assistance from a union to negotiate and thereafter “police” collective bargaining agreements containing contractually guaranteed wages, hours, and other terms and conditions of employment.

After all, what rational worker would voluntarily pay costly dues out of their paycheck to pay a union to represent them when dealing with their employer unless the employer’s practices gives them cause to do so? It is certainly not easy for unions to organize a group of workers. It therefore follows that an employer must first set the stage for a union to organize its workforce by treating them in a manner perceived to be disrespectful and/or paying them less than their counterparts employed in similar industries who are represented by a union.

On the other side of the equation, an employer may wish to consider the consequences should his workforce become organized by a union representing them when dealing with management. Under those circumstances, the employer loses control over a portion of its enterprise concerning the management of its workforce, which become governed by the terms and conditions specified in a resulting collective bargaining agreement with the union. Moreover, the employer, in all likelihood, will feel the need when faced with vigorous union advocates to retain expert assistance on its own side of the bargaining table during often difficult negotiations leading to an initial collective bargaining agreement and each time the agreement is up for renewal. Also, during the term of the collective bargaining agreement, grievances may be filed by the union, which is charged with policing the agreement challenging the employer’s claim violations of the agreement. The employer may once again feel compelled to retain expert representation, often by skilled attorneys, to defend itself against the union’s grievance should it go to arbitration and thus incur the necessary time and expenses in doing so, including, at minimum, significant legal costs. And that is a best-case scenario when the employer wins in arbitration. Employers should also consider, however, the additional financial costs and loss of credibility in the eyes of the union should the employer lose the case in arbitration and be required to pay damages potentially in the thousands of dollars to its aggrieved employees. It all becomes quite costly, distracting, and time consuming.