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115th Congress } { Report
HOUSE OF REPRESENTATIVES
1st Session } { 115-326
======================================================================
WORKFORCE DEMOCRACY AND FAIRNESS ACT
_______
September 25, 2017.--Committed to the Committee of the Whole House on
the State of the Union and ordered to be printed
_______
Ms. Foxx, from the Committee on Education and the Workforce, submitted
the following
R E P O R T
together with
MINORITY VIEWS
[To accompany H.R. 2776]
[Including cost estimate of the Congressional Budget Office]
The Committee on Education and the Workforce, to whom was
referred the bill (H.R. 2776) to amend the National Labor
Relations Act with respect to the timing of elections and pre-
election hearings and the identification of pre-election
issues, having considered the same, report favorably thereon
with an amendment and recommend that the bill as amended do
pass.
The amendment is as follows:
Strike all after the enacting clause and insert the
following:
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Workforce Democracy and Fairness
Act''.
SEC. 2. PRE-ELECTION HEARINGS.
Section 9(c)(1) of the National Labor Relations Act (29 U.S.C.
159(c)(1)) is amended in the matter following subparagraph (B)--
(1) by inserting ``, but in no circumstances less than 14
calendar days after the filing of the petition'' after ``upon
due notice'';
(2) by inserting after ``with respect thereto.'' the
following: ``An appropriate hearing shall be one that is non-
adversarial with the hearing officer charged, in collaboration
with the parties, with the responsibility of identifying any
relevant and material pre-election issues and thereafter making
a full record thereon. Relevant and material pre-election
issues shall include, in addition to unit appropriateness, the
Board's jurisdiction and any other issue the resolution of
which may make an election unnecessary or may reasonably be
expected to impact the outcome of the election. Parties may
independently raise any relevant and material pre-election
issue or assert any relevant and material position at any time
prior to the close of the hearing.''; and
(3) by striking ``and shall certify the results thereof'' and
inserting ``to be conducted as soon as practicable but no
earlier than 35 calendar days after the filing of an election
petition. The Board shall certify the results of the election
after it has ruled on each pre-election issue not resolved
before the election and any additional issue pertaining to the
conduct or results of the election''.
SEC. 3. DETERMINATION OF APPROPRIATE UNITS FOR COLLECTIVE BARGAINING.
Section 9(b) of the National Labor Relations Act (29 U.S.C. 159(b))
is amended--
(1) by redesignating paragraphs (1) through (3) as
subparagraphs (A) through (C), respectively;
(2) by striking ``The Board shall decide'' and all that
follows through ``or subdivision thereof:'' and inserting the
following: ``(1) In each case, prior to an election, the Board
shall determine, in order to assure to employees the fullest
freedom in exercising the rights guaranteed by this Act, the
unit appropriate for the purposes of collective bargaining.
Unless otherwise stated in this Act, and excluding any
bargaining unit determination promulgated through rulemaking
before August 26, 2011, the unit appropriate for purposes of
collective bargaining shall consist of employees that share a
sufficient community of interest. In determining whether
employees share a sufficient community of interest, the Board
shall consider--
``(A) similarity of wages, benefits, and working conditions;
``(B) similarity of skills and training;
``(C) centrality of management and common supervision;
``(D) extent of interchange and frequency of contact between
employees;
``(E) integration of the work flow and interrelationship of
the production process;
``(F) the consistency of the unit with the employer's
organizational structure;
``(G) similarity of job functions and work; and
``(H) the bargaining history in the particular unit and the
industry.
To avoid the proliferation or fragmentation of bargaining units, no
employee shall be excluded from the unit unless the interests of the
group seeking a separate unit are sufficiently distinct from those of
other employees to warrant the establishment of a separate unit.
Whether additional employees should be included in a proposed unit
shall be determined based on whether such additional employees and
proposed unit members share a sufficient community of interest, with
the sole exception of proposed accretions to an existing unit, in which
the inclusion of additional employees shall be based on whether such
additional employees and existing unit members share an overwhelming
community of interest and the additional employees have little or no
separate identity.''; and
(3) by striking ``Provided, That the Board'' and inserting
the following:
``(2) The Board''.
Purpose
The Workforce Democracy and Fairness Act, H.R. 2776,
reverses the National Labor Relations Board's (NLRB or Board)
August 26, 2011, decision in Specialty Healthcare and
Rehabilitation Center of Mobile\1\ (Specialty Healthcare), and
reverses the NLRB's December 15, 2014, final representation-
case procedures rule\2\ (the ambush election rule). The
legislation ensures cohesion in the workplace, employee free
choice, and employer free speech, without upsetting any other
current law.
---------------------------------------------------------------------------
\1\357 NLRB 934, 940 (2011)
\2\79 Fed. Reg. at 74308.
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Committee Action
112TH CONGRESS
Subcommittee Hearing on Concerns about the NLRB's Harmful Actions
On February 11, 2011, the Subcommittee on Health,
Employment, Labor, and Pensions (HELP) of the Committee on
Education and the Workforce (Committee) held a hearing on
``Emerging Trends at the National Labor Relations Board.'' The
hearing examined controversial and precedent-changing NLRB
holdings and invitations for briefs (including Specialty
Healthcare), the NLRB's December 22, 2010, Notice of Proposed
Rulemaking that mandated employers display a vague and biased
poster regarding union rights at work, and new policies issued
by Acting NLRB General Counsel Lafe Solomon. Witnesses at this
hearing were Mr. Philip A. Miscimarra, Partner, Morgan, Lewis &
Bockius LLP, Chicago, Illinois; Mr. Arthur Rosenfeld, Former
National Labor Relations Board General Counsel, Alexandria,
Virginia; Mr. G. Roger King, Partner, Jones Day, Columbus,
Ohio; and, Ms. Cynthia Estlund, Professor of Law, New York
University School of Law, New York, New York.
Committee Hearing on NLRB's Unprecedented Rulemaking
On July 7, 2011, the Committee heard testimony on the
NLRB's proposed election procedure regulation in a hearing on
``Rushing Union Elections: Protecting the Interests of Big
Labor at the Expense of Workers' Free Choice.'' Witnesses
agreed the cumulative changes in the proposal would
significantly hinder an employer's ability to communicate with
his or her employees and cripple an employee's right to choose
whether to be represented by a labor organization. Witnesses
were the Honorable Peter C. Schaumber, former National Labor
Relations Board Chairman, Washington, D.C.; Mr. Larry Getts,
Tube Press Technician, Dana Corporation, Garrett, Indiana; Mr.
John Carew, President, Carew Concrete & Supply Company,
Appleton, Wisconsin, testifying on behalf of himself and the
National Ready Mixed Concrete Association; Mr. Michael J.
Lotito, Attorney, Jackson Lewis LLP, San Francisco, California;
and, Mr. Kenneth Dau-Schmidt, Professor, Indiana University,
Maurer School of Law, Bloomington, Indiana.
Committee Hearing on NLRB's Decision to Disenfranchise Employees in
Union Elections
On September 22, 2011, the Committee held a hearing on the
``Culture of Union Favoritism: Recent Actions of the National
Labor Relations Board.'' At the end of August 2011, the NLRB
issued a number of biased, anti-worker decisions, including
Specialty Healthcare. Additionally, the Board finalized a rule
requiring almost every employer to post a vague, union-biased
notice on employee rights under the National Labor Relations
Act (NLRA). The Board's unbridled overreach of authority
demanded a complete examination by the Committee. Witnesses
were Mr. Curtis L. Mack, Partner, McGuireWoods LLP, Atlanta,
Georgia; Ms. Barbara A. Ivey, Employee, Kaiser Permanente,
Keizer, Oregon; Mr. Arthur J. Martin, Partner, Schuchat, Cook &
Werner, St. Louis, Missouri; and Mr. G. Roger King, Partner,
Jones Day, Columbus, Ohio.
Introduction of H.R. 3094, Workforce Democracy and Fairness Act
On October 5, 2011, then-Chairman John Kline (R-MN)
introduced H.R. 3094, the Workforce Democracy and Fairness Act,
with 26 cosponsors. Recognizing the NLRB had gone far beyond
its statutorily assigned role as an adjudicative body designed
to implement congressional intent under the NLRA, legislation
was necessary to (1) reinstate the traditional standard for
determining which employees make up an appropriate bargaining
unit; (2) ensure employers are able to participate in a fair
union election; (3) guarantee workers have the ability to make
fully informed decisions in union elections; and (4) safeguard
employee privacy by allowing workers to decide the type of
personal information provided to a union.
Committee Legislative Hearing on H.R. 3094, Workforce Democracy and
Fairness Act
On October 12, 2011, the Committee held a legislative
hearing on H.R. 3094. Witnesses testified the Board had
overturned decades of precedent to facilitate union organizing
at the cost of employee free choice and employer free speech
and these actions would have devastating economic consequences
for the country. Witnesses were the Honorable Charles Cohen,
Senior Counsel, Morgan, Lewis and Bockius LLP, and Former
Member, National Labor Relations Board, Washington, D.C.; Mr.
Robert Sullivan, President, RG Sullivan Consulting,
Westmoreland, New Hampshire, testifying on behalf of the Retail
Industry Leaders Association; Mr. Michael J. Hunter, Partner,
Hunter, Carnahan, Shoub, Byard and Harshman, Columbus, Ohio;
and, Mr. Phillip Russell, Attorney, Ogletree Deakins, Tampa,
Florida.
Committee Passage of H.R. 3094, Workforce Democracy and Fairness Act
On October 26, 2011, the Committee considered H.R. 3094.
Then-Chairman Kline offered an amendment in the nature of a
substitute to clarify that years of labor policies affecting
the acute health care industry remain in place; limit pre-
election issues to those that are relevant and material; and
reaffirm the Board's responsibility to grant or deny requests
for review of regional directors' decisions before an election.
Nine additional amendments were offered and debated; however,
no amendments beyond the substitute were adopted. The Committee
favorably reported the bill, as amended, to the House of
Representatives by a vote of 23 to 16.
House Passage of H.R. 3094, Workforce Democracy and Fairness Act
On November 30, 2011, the House of Representatives
considered H.R. 3094. Four amendments and an amendment in the
nature of a substitute were offered, but none were adopted. The
House passed H.R. 3094 by a bipartisan vote of 235 to 188. The
Senate failed to act on the bill before the conclusion of the
112th Congress.
113TH CONGRESS
Subcommittee Hearing on Union Organizing
On September 19, 2013, the HELP Subcommittee held a hearing
on ``The Future of Union Organizing.'' The hearing reviewed the
application of Specialty Healthcare and the future of NLRB
representational elections. Witnesses were Mr. David R. Burton,
General Counsel, National Small Business Association,
Washington, D.C.; Mr. Clarence Adams, Field Technician,
Cablevision, Brooklyn, New York; Mr. Ronald Meisburg, Member,
Proskauer Rose, Washington, D.C.; and, Mr. Stefan J.
Marculewicz, Shareholder, Littler Mendelson, Washington, D.C.
Committee Hearing on the NLRB's Proposed Ambush Election Rule
On March 5, 2014, the Committee held a hearing entitled
``Culture of Union Favoritism: The Return of the NLRB's Ambush
Election Rule.'' Witnesses testified the proposed ambush
election rule\3\ would considerably shorten the time between
the filing of the petition and the election date and
substantially limit the opportunity for a full evidentiary
hearing or Board resolution of contested issues, including
appropriate bargaining unit, voter eligibility, and election
misconduct. Witnesses were Ms. Doreen S. Davis, Partner, Jones
Day, New York, New York; Mr. Steve Browne, Vice President of
Human Resources, LaRosa, Cincinnati, Ohio; Ms. Caren P. Sencer,
Esq., Shareholder, Weinberg, Roger & Rosenfeld P.C., Alameda,
California; and, Mr. William Messenger, Staff Attorney,
National Right to Work Legal Defense Foundation, Inc.,
Springfield, Virginia.
---------------------------------------------------------------------------
\3\Representation-Case Procedures, 79 Fed. Reg. 74308, 7318 (Dec.
15, 2014).
---------------------------------------------------------------------------
Introduction of H.R. 4320, Workforce Democracy and Fairness Act
On March 27, 2014, then-Chairman Kline introduced H.R.
4320, the Workforce Democracy and Fairness Act, with 20
cosponsors. The legislation largely mirrored H.R. 3094, the
Workforce Democracy and Fairness Act, as introduced in the
112th Congress. Recognizing the NLRB's ambush election rule
would fundamentally alter representational elections to the
detriment of employers and employees, provisions were added to
(1) ensure employers were able to participate in a fair union
election and (2) guarantee workers had the ability to make a
fully informed decision in a union election.
Committee Passage of H.R. 4320, Workforce Democracy and Fairness Act
On April 9, 2014, the Committee considered H.R. 4320, the
Workforce Democracy and Fairness Act. Chairman Kline offered an
amendment in the nature of a substitute, making a technical
change to clarify the legislation applies to representational
elections. Four additional amendments were offered and debated.
Rep. Tom Price's (R-GA) amendment codifying the NLRB's
bargaining unit determination standard prior to Specialty
Healthcare was adopted by a vote of 21 to 13. The Committee
favorably reported H.R. 4320, as amended, to the House of
Representatives by a vote of 21 to 14. The Senate failed to act
on the bill before the end of the 113th Congress.
Committee Hearing on Unionization of Student Athletes
On May 8, 2014, the Committee held a hearing entitled ``Big
Labor on College Campuses: Examining the Consequences of
Unionizing Student Athletes.'' Witnesses testified the recent
NLRB ruling declaring student athletes to be employees under
the NLRA risked bringing micro-unions and ambush elections to
college and university campuses further perpetuating the issues
seen in non-collegial settings. Witnesses were the Honorable
Ken Starr, President and Chancellor, Baylor University, Waco,
Texas; Mr. Bradford L. Livingston, Partner at Seyfarth Shaw
LLP, Chicago, Illinois; Mr. Andy Schwarz, Partner, OSKR LLC,
Emeryville, California; Mr. Bernard M. Muir, Director of
Athletics, Stanford University, Stanford, California; and, Mr.
Patrick C. Eilers, Managing Director, Madison Dearborn
Partners, Chicago, Illinois.
Subcommittee Hearing on Recent NLRB Decisions
On June 24, 2014, the HELP Subcommittee held a hearing on
``What Should Workers and Employers Expect Next from the
National Labor Relations Board?'' Witnesses testified NLRB
actions, including decisions restricting employee access to
secret ballots, imposing ambush elections, and encouraging
micro-unions, had generated uncertainty and confusion for
employers, hurting job creation and growth. Witnesses were Mr.
Seth H. Borden, Partner, McKenna Long & Aldridge LLP, New York,
New York; Mr. James Coppess, Associate General Counsel, AFL-
CIO, Washington, D.C.; Mr. G. Roger King, Of Counsel, Jones
Day, Columbus, Ohio; and, Mr. Andrew F. Puzder, CEO, CKE
Restaurants, Carpinteria, California.
114TH CONGRESS
Subcommittee Legislative Hearing on H.J. Res. 29, Providing for
Congressional Disapproval of the Ambush Election Rule
On March 4, 2015, the HELP Subcommittee held a legislative
hearing entitled ``H.J. Res. 29, Providing for congressional
disapproval under chapter 8 of title 5, United States Code, of
the rule submitted by the National Labor Relations Board
relating to representation case procedures.'' The Joint
Resolution disapproved and nullified the rule submitted by the
NLRB and published on December 15, 2014. At the hearing,
witnesses testified to the urgent need for Congress to overturn
the NLRB's ambush election rule, which would have negative
consequences for workers and families. Witnesses at this
hearing were Ms. Brenda Crawford, Registered Nurse, Murrieta,
California; Mr. Roger King, Senior Labor and Employment
Counsel, on behalf of the Retail Industry Leaders Association,
Washington, D.C.; Mr. Arnold E. Perl, Member, Glankler Brown
PLLC, Memphis, Tennessee, and, Mr. Glenn M. Taubman, Staff
Attorney, National Right to Work Legal Defense and Educational
Foundation, Inc., Springfield, Virginia.
Introduction of H.R. 1768, Workforce Democracy and Fairness Act
On April 14, 2015, then-Chairman Kline introduced H.R.
1768, the Workforce Democracy and Fairness Act, with two
cosponsors. The text of H.R. 1768 was identical to that of H.R.
4320 as amended by the Committee in April 2014.
115TH CONGRESS
Subcommittee Hearing on the Need to Restore Balance to the NLRB
On February 14, 2017, the HELP Subcommittee held a hearing
entitled ``Restoring Balance and Fairness to the National Labor
Relations Board.'' Witnesses decried the extreme, partisan
decisions of the NLRB during the Obama administration,
including the ambush election rule, and stressed the need for a
return to a balance between workers, employers, and unions in
the Board's rulings. Witnesses at this hearing were Ms. Reem
Aloul, BrightStar Care of Arlington, Arlington, Virginia, on
behalf of the Coalition to Save Local Business; Ms. Susan
Davis, Partner, Cohen, Weiss and Simon, LLP, New York, New
York; Mr. Raymond J. LaJeunesse, Jr., Vice President, National
Right to Work Legal Defense and Education Foundation,
Springfield, Virginia; and, Mr. Kurt G. Larkin, Partner, Hunton
& Williams LLP, Richmond, Virginia.
Introduction of H.R. 2776, Workforce Democracy and Fairness Act
On June 6, 2017, HELP Subcommittee Chairman Tim Walberg (R-
MI) introduced H.R. 2776, the Workforce Democracy and Fairness
Act, with six cosponsors. The text of H.R. 2776 is identical to
the text of H.R. 1768, which was referred to the Committee in
April 2015 but not acted on prior to the conclusion of the
114th Congress.
Subcommittee Legislative Hearing on H.R. 2776, H.R. 2775, and H.R. 2723
On June 14, 2017, the HELP Subcommittee held a hearing
entitled ``Legislative Reforms to the National Labor Relations
Act: H.R. 2776, Workforce Democracy and Fairness Act; H.R.
2775, Employee Privacy Protection Act; and, H.R. 2723, Employee
Rights Act.'' Among other topics, witnesses testified about the
need for H.R. 2776 to fix the problems created by the activist-
NLRB related to the ambush election rule. Witnesses at this
hearing were Mr. Seth H. Borden, Partner, McGuireWoods LLP, New
York, New York; Mr. Guerino J. Calemine III, General Counsel,
Communications Workers of America, Washington D.C.; Ms. Karen
Cox, Dixon, Illinois; and, Ms. Nancy McKeague, Senior Vice
President and Chief of Staff, Michigan Health and Hospital
Association, Okemos, Michigan, on behalf of the Society for
Human Resource Management.
Summary
The Workforce Democracy and Fairness Act (1) codifies the
traditional standard for determining an appropriate bargaining
unit and the traditional standard used to challenge a
petitioned-for bargaining unit; (2) requires the Board to rule
prior to the election on challenges to composition of the
bargaining unit; (3) ensures employers have at least 14 days to
prepare for pre-election hearings; (4) allows parties to raise
relevant and material pre-election issues as pre-election
hearing records are developed; (5) provides employees with at
least 35 days to consider whether they wish to be represented
by a union; and (6) ensures parties may request a post-election
Board review of regional directors' decisions.
The legislation reverses the NLRB's August 26, 2011,
decision in Specialty Healthcare and the NLRB's ambush election
rule. The legislation ensures cohesion in the workplace,
employee free choice, and employer free speech.
Committee Views
In 1935, Congress passed the NLRA, guaranteeing the right
of most private sector employees to organize and select their
own representative.\4\ In 1947, Congress passed the Taft-
Hartley Act,\5\ the most significant amendment of the NLRA,
abandoning ``the policy of affirmatively encouraging the spread
of collective bargaining . . . [and] striking a new balance
between protection of the right to self-organization and
various opposing claims.''\6\ The Taft-Hartley Act clarified
employees have the right to refrain from participating in union
activity,\7\ created new union unfair labor practices,\8\
codified employer free speech,\9\ and made changes to the
determination of bargaining units.\10\
---------------------------------------------------------------------------
\4\The NLRA does not cover all employees and employers in the
United States. For example, public sector employers (state, local, and
federal employees), employers covered by the Railway Labor Act
(airlines and railroads), agricultural labor, and supervisors are not
covered by the act. 29 U.S.C. Sec. 152(2).
\5\29 U.S.C. Sec. 141 et. seq.
\6\Archibald Cox, Some Aspects of the Labor Management Relations
Act of 1947, 61 Harv. L. Rev. 1, 4 (1947).
\7\29 U.S.C. Sec. 157.
\8\Id. Sec. 158.
\9\Id. Sec. 158(c).
\10\Id. Sec. 159(d).
---------------------------------------------------------------------------
The NLRA established the NLRB as an independent federal
agency to fulfill two principal functions: (1) prevent and
remedy employer and union unlawful acts, called unfair labor
practices; and (2) determine by secret ballot election whether
employees wish to be represented by a union. In determining
whether employees wish to be represented by a union, the NLRA
is wholly neutral.\11\
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\11\NLRB v. Savair Mfg., 414 U.S. 270, 278 (1973).
---------------------------------------------------------------------------
Section 9 of the NLRA broadly lays out the rules under
which employees exercise their right to select or reject a
union through a secret ballot.\12\ In general, NLRB rulings,
regulations, and internal policies establish specific
representational election procedures.\13\
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\12\29 USC Sec. 159.
\13\79 Fed. Reg. at 7319.
---------------------------------------------------------------------------
The representational election process begins when
employees, an employer, or a labor organization files a
petition for an investigation and certification of the
representatives (petition) with the NLRB's regional office.\14\
If a petition is filed by employees or a labor organization,
the petitioner should present within 48 hours of filing
evidence that 30 percent of employees in the proposed
bargaining unit support the petition, typically through signed
and dated authorization cards.\15\
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\14\National Labor Relations Board Casehandling Manual
para.11002.2-11002.3.
\15\Id. para.11003.1 and 11023.1.
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Previous Representational Election Process
Prior to the December 2015 ambush election rule, the
regional director,\16\ upon receiving a petition, would issue a
notice of hearing and serve the following on the employer: the
petition, a generic notice of employees' rights, and a
Questionnaire on Commerce to receive information relevant to
the Board's jurisdiction.\17\ Additionally, the regional
director would ordinarily request a list of employees in the
petitioned-for unit and their job classifications to determine
whether 30 percent of employees were interested in
representation and the employer's position as to the
appropriateness of the unit described in the petition.\18\
---------------------------------------------------------------------------
\16\While the Board is responsible for conducting secret ballot
elections, in 1961 it delegated the bulk of its authority over election
cases to its regional directors. The regional directors: (1) decide
whether a question concerning representation exists; (2) determine the
appropriate bargaining unit; (3) direct the election; (4) certify the
results of the election; and (5) make findings and issue rulings on
objections and challenged ballots.
\17\Id. para.11009.
\18\Id. para.11009.1.
---------------------------------------------------------------------------
These official requests by the regional director were then
followed up by telephone consultations, meetings, and joint
conference calls with the parties prior to pre-election hearing
to resolve outstanding issues and secure an election
agreement.\19\ If parties agreed on representational issues,
they could enter into one of three types of election
agreements: (1) consent election agreement, (2) stipulated
election agreement, or (3) full consent election agreement.\20\
---------------------------------------------------------------------------
\19\Id. para.11012.
\20\Id. para.11084. (In consent agreements, post-election issues
are decided by the regional director. In stipulated agreements, post-
election issues are decided by the Board. There are no outstanding
issues in full consent election agreements; therefore, no review is
necessary.)
---------------------------------------------------------------------------
In cases where parties could not reach an election
agreement, a Board agent would conduct a pre-election hearing
to develop and record evidence upon which the Board could
discharge its duties under Section 9 of the NLRA.\21\ The
hearing was investigatory and non-adversarial.\22\ Parties
could present evidence on issues including the Board's
jurisdiction, the existence of any bars to an election, the
appropriateness of the unit, and eligibility of particular
employees to vote.\23\ The employer could petition for
inclusion of additional employees in the bargaining unit by
showing the additional employees shared a ``sufficient
community of interest'' with the petitioned-for unit.
---------------------------------------------------------------------------
\21\National Labor Relations Board Casehandling Manual para.11181.
\22\Id.
\23\79 Fed. Reg. at 7324.
---------------------------------------------------------------------------
In most cases, the regional director would either direct an
election or dismiss the petition. Under these procedures in
2013, the median time between the notice of hearing and the
close of the pre-election hearing was 13 days.\24\ The median
time between the close of the pre-election hearing and the
regional director's decision was 20 days.\25\
---------------------------------------------------------------------------
\24\E-mail from Celine McNicholas, Special Counsel, National Labor
Relations Board, to Marvin Kaplan, Workforce Policy Counsel, House
Education and the Workforce Committee (Mar. 3, 2014, 12:22 EST) (on
file with author).
\25\Id.
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To ensure uniform and consistent application, parties could
appeal to the Board the regional director's pre- and post-
election decisions. Unless waived in a pre-election agreement,
parties could obtain Board review of the regional director's
disposition of election objections and challenges post-election
by filing exceptions.\26\
---------------------------------------------------------------------------
\26\79 Fed. Reg. at 7325.
---------------------------------------------------------------------------
This previous Board process was effective in expeditiously
resolving questions concerning representation while maintaining
the rights of employees and employers. For all petitions filed
in the final full year before the new rule went into effect,
the median time from the filing of a petition to an election
was 38 days.\27\ Additionally, unions won more than two-thirds
of representational elections in that time period.\28\
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\27\NLRB, MEDIAN DAYS FROM PETITION TO ELECTION (2017), https://
www.nlrb.gov/news-outreach/graphs-data/petitions-and-elections/median-
days-petition-election.
\28\NLRB, REPRESENTATION PETITIONS (2017), https://www.nlrb.gov/
news-outreach/graphs-data/petitions-and-elections/representation-
petitions-rc.
---------------------------------------------------------------------------
A. The Ambush Election Rule
In February 2014, in a rare exercise of formal rulemaking,
the NLRB published a Notice of Proposed Rulemaking, which
became a final rule on December 15, 2014, and went into effect
on April 14, 2015.\29\ The rule shortens the length of time in
which a union representational election can be held to as
little as 11 days. The rule also requires employers to complete
a Statement of Position in which the employer must raise all
pre-election issues challenging the legality of the union's
organizing campaign or forfeit all rights to pursue those
issues. Additionally, the rule expands the information provided
to unions to include employee phone numbers, email addresses,
and shift times and locations. The rule also delays Board
review until after the election. Taken together, the rule
substantially shortens the time between filing of a petition
and the election date, and it limits the opportunity for a full
evidentiary hearing or Board review on contested issues.
---------------------------------------------------------------------------
\29\79 Fed. Reg. at 7324.
---------------------------------------------------------------------------
In March 2015, the House and Senate passed a joint
resolution of disapproval (S.J. Res. 8) of the new rule under
the Congressional Review Act. The joint resolution was vetoed
by President Obama on March 31, 2015.
To speed up the representational election process, the
Board's rule: (1) replaced the Questionnaire on Commerce
Information with a Statement of Position; (2) set pre-election
hearings to begin seven days after the petition is filed: (3)
delayed voter eligibility issues until after the election: and
(4) made post-election Board review discretionary.\30\
---------------------------------------------------------------------------
\30\Id.
---------------------------------------------------------------------------
The newly required Statement of Position solicits the
parties' positions on: (1) the Board's jurisdiction; (2) the
appropriateness of the petitioned-for unit; (3) any proposed
exclusions from the petitioned-for unit; (4) the existence of
any bar to the election; (5) the types, dates, times, and
locations of the election; and (6) any other issues that a
party intends to raise at the hearing.\31\ With few exceptions,
issues not raised in the Statement of Position will be
waived.\32\ The Statement of Position is due no later than the
date of the pre-election hearing, that is, seven days from the
filing of the petition.\33\
---------------------------------------------------------------------------
\31\Id. at 7328.
\32\Id.
\33\Id.
---------------------------------------------------------------------------
Under the rule, disputes concerning the eligibility or
inclusion of individual employees that represent less than 20
percent of the unit are resolved, if necessary, after the
election.\34\ According to the Board, the ``adoption of a
bright-line numerical rule requiring that questions concerning
the eligibility or inclusion of individuals constituting no
more than 20 percent of all potentially eligible voters be
litigated and resolved, if necessary, post-election, best
serves the interests of the parties and employees as well as
the public interest in efficient administration of the
representation case process.''\35\
---------------------------------------------------------------------------
\34\Id. at 7330.
\35\Id. at 7331.
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The rule also eliminates pre-election Board review.\36\ All
pre-election rulings not rendered moot remain subject to Board
review post-election.\37\ Regional directors are no longer
required to provide at least 25 days between the issuance of
the decision and the election to allow Board review.\38\
---------------------------------------------------------------------------
\36\Id. at 7333.
\37\Id.
\38\29 C.F.R. 101.21(d).
---------------------------------------------------------------------------
The Board's majority asserted the rule was implemented to
``remove unnecessary barriers to the fair and expeditious
resolution of questions concerning representation.''\39\
However, the Board made no ``attempt to identify particular
problems in cases where the process has failed.''\40\ In the
opinion of former NRLB Member Brian Hayes, ``vacancies or
partisan shifts in Board membership and the inability of the
Board itself to deal promptly with complex legal and factual
issues have delayed final resolution far more often than any
systematic procedural problems or obstructionist legal
tactics.''\41\ Testifying at a 2011 hearing, Former NLRB
Chairman Peter Schaumber agreed the election process was not
the source of delays.\42\ As Member Hayes has also noted, the
``problem'' the Board seeks to address with this rule ``is not
that the representation election process generally takes too
long, [i]t is that unions are not winning more elections . . .
The [Board] majority [has] act[ed] in apparent furtherance of
the interests of a narrow constituency, [unions,] and at the
great expense of undermining public trust in the fairness of
Board elections.''\43\ It is the Committee's view the Board
sought to address a problem that does not exist.
---------------------------------------------------------------------------
\39\Id. at 7337.
\40\76 Fed. Reg. at 36833.
\41\Id. at 36831.
\42\Rushing Union Elections: Protecting the Interests of Big Labor
at the Expense of Workers' Free Choice, Hearing before the House
Education and the Workforce Committee, 112th Cong., 1st Sess. at 77
(2011).
\43\Notice of Proposed Rulemaking, Representation--Case Procedures,
76 Fed. Reg. 36812, 80 (June 22, 2011), available at http://
www.nlrb.gov/sites/default/files/documents/525/2011-15307_pi_2.pdf.
---------------------------------------------------------------------------
B. Specialty Healthcare and Rehabilitation Center of Mobile
On August 26, 2011, in Specialty Healthcare,\44\ the Board
majority articulated a new standard for determining the
composition of bargaining units. Under this new standard, if
the union-proposed bargaining unit is made up of a readily
identifiable group\45\ and the Board finds the employees in the
group share a ``community of interest,'' the Board will find
the proposed unit appropriate.\46\ Any party seeking to enlarge
the unit must demonstrate employees in the larger unit share an
``overwhelming community of interest'' with those in the
petitioned-for unit.\47\ The Board will no longer determine
whether the interests of the group sought are sufficiently
distinct from those of other employees to warrant the
establishment of a separate unit.\48\ While the Specialty
Healthcare case dealt specifically with non-acute healthcare,
the Board decision significantly affects all industries.\49\
NLRB regional offices ``will have little option but to find
almost any petitioned-for unit appropriate.''\50\ In the
opinion of former NLRB Region 10 Director Curtis Mack, ``a
regional director looking at a representation petition would be
compelled to hold a representation election for any unit
supported by the union.''\51\ Under the new standard, it is
``virtually impossible for a party opposing th[e] unit to prove
that any excluded employees should be included.''\52\
---------------------------------------------------------------------------
\44\357 NLRB No. 83 (Aug. 26, 2011).
\45\Such as employees that make up a job classification,
department, or work location.
\46\357 NLRB No. 83, 12 (Aug. 26, 2011).
\47\Id. at 6.
\48\Id. at 12.
\49\Id. at 18.
\50\Id. at 20.
\51\Culture of Union Favoritism: Recent Actions of the National
Labor Relations Board: Hearing before the H. Comm. on Educ. and the
Workforce, 112th Cong. at 13 (2011) (written testimony of Curtis Mack).
\52\Id. at 19.
---------------------------------------------------------------------------
Under Specialty Healthcare, the NLRB has approved
fragmented petitioned-for units despite past precedent, and
subsequent challenges to the unit have been unsuccessful. For
example, on July 22, 2014, in Macy's, Inc.,\53\ the NLRB
determined that cosmetics and fragrance employees at the Macy's
store in Saugus, Massachusetts, are an appropriate unit for
collective bargaining.\54\ Despite past precedent that the
appropriate unit is a store-wide unit\55\ and extensive
evidence that all sales associates share a community of
interest,\56\ in the opinion of the Board majority,\57\ the
employer had not ``demonstrated that its other selling
employees share an overwhelming community of interest with the
cosmetics and fragrances employees.''\58\ While the NLRB
rejected a unit consisting of employees in the salon and
contemporary shoes departments at a Manhattan Bergdorf Goodman
in The Neiman Marcus Group, Inc., it appears to endorse an even
smaller unit consisting of only those employees in a certain
shoes department.\59\
---------------------------------------------------------------------------
\53\Macy's Inc, 361 NLRB No. 4 (2014).
\54\Id. at 1.
\55\Bullocks, Inc., d/b/a I. Magnin & Co., 119 NLRB 642 (1957).
\56\Macy's, supra note 53 at 22-3.
\57\Member Miscimarra dissented and Member Johnson recused himself.
\58\Macy's, supra note 53 at 19.
\59\The Neiman Marcus Group, Inc., 361 NLRB No. 11, 3 (2014).
---------------------------------------------------------------------------
C. Implications of the New Representation Election Process
and Specialty Healthcare
The NLRB's representational election rule restricts an
employer's ability to communicate with his or her employees,
cripples an employee's ability to make an informed decision as
to unionization, increases litigation, and decreases election
agreements. The August 26, 2011, Specialty Healthcare decision
has fractured workplaces, increased labor costs and decreased
employee opportunities.
Limited Opportunity for a Robust Debate and Employee Free
Choice
Congress recognized the value of employer speech and a
robust debate when it added section 8(c) to the NLRA.\60\ The
Supreme Court noted Congress's express protection of free
debate:
---------------------------------------------------------------------------
\60\29 U.S.C. Sec. 158(c)(``The expressing of any views, argument,
or opinion, or the dissemination thereof, whether in written, printed,
graphic, or visual form, shall not constitute or be evidence of an
unfair labor practice under any of the provisions of this Act
[subchapter], if such expression contains no threat of reprisal or
force or promise of benefit.'').
From one vantage, Sec. 8(c) ``merely implements the
First Amendment,'' NLRB v. Gissel Packing Co., 395 U.S.
575, 617, 89 S.Ct. 1918, 23 L.Ed.2d 547 (1969), in that
it responded to particular constitutional rulings of
the NLRB. See S.Rep. No. 80-105, pt. 2, pp. 23-24
(1947). But its enactment also manifested a
``congressional intent to encourage free debate on
issues dividing labor and management.'' Linn v. Plant
Guard Workers, 383 U.S. 53, 62, 86 S.Ct. 657, 15
L.Ed.2d 582 (1966). It is indicative of how important
Congress deemed such ``free debate'' that Congress
amended the NLRA rather than leaving to the courts the
task of correcting the NLRB's decisions on a case-by-
case basis. We have characterized this policy judgment,
which suffuses the NLRA as a whole, as ``favoring
uninhibited, robust, and wide-open debate in labor
disputes,'' stressing that ``freewheeling use of the
written and spoken word . . . has been expressly
fostered by Congress and approved by the NLRB.'' Letter
Carriers v. Austin, 418 U.S. 264, 272-273, 94 S.Ct.
2770, 41 L.Ed.2d 745 (1974).\61\
---------------------------------------------------------------------------
\61\Chamber of Commerce v. Brown, 554 U.S. 60, 67-68 (2008).
The new election procedures effectively eliminate an
employer's opportunity to communicate with his or her
employees. Under the new election procedures, representational
elections will be held in as little as 11 days.\62\ An employer
could spend the first seven days finding legal representation
and preparing for the pre-election hearing, leaving as little
as four days to educate employees and rebut misinformation.
---------------------------------------------------------------------------
\62\76 Fed. Reg. 36831.
---------------------------------------------------------------------------
In contrast, a union seeking to organize employees will
have weeks, maybe years, to covertly lobby employees while
collecting authorization cards. Unlike the employer, the union
can promise employees increased wages, benefits, and vacation
time with few restrictions under the law.\63\ While employees
are likely to receive extensive information from the union on
the benefits of unionization, they are unlikely to receive
information from the union on the union's political or social
agenda, dues, or the effects unionization can have on their
employer's profitability and market competitiveness.\64\ When
the union has garnered sufficient support, it selects the date
and time for filing the petition.\65\
---------------------------------------------------------------------------
\63\Rushing Union Elections: Protecting the Interests of Big Labor
at the Expense of Workers' Free Choice: Hearing before the H. Comm. on
Educ. and the Workforce, 112th Cong., at 15 (2011) (written testimony
of Peter Schaumber).
\64\Id.
\65\Id.
---------------------------------------------------------------------------
At the Committee's July 7, 2011, hearing entitled ``Rushing
Union Elections: Protecting the Interests of Big Labor at the
Expense of Workers' Free Choice,'' Mr. John Carew, president of
Carew Concrete and Supply Co., described his experience with a
union organizing drive and election. In mid-September 1999,
during one of his company's busiest times of year, the NLRB
informed Carew Concrete that a union was attempting to organize
its entire employee base.\66\ This was the first time Mr. Carew
had heard about the organizing drive.\67\ Speaking of the
organizing drive at Carew Concrete, Mr. Carew testified:
``[E]mployees would receive mail containing not enough
information, misinformation, and misleading information on
issues such as striking, healthcare insurance, wages and
pensions. At times employees were inaccurately told they would
receive increased wages, similar to cities with higher wages
nearly 100 miles away.''\68\ Mr. Carew was forced to shut down
temporarily portions of his business to educate supervisors and
managers to ensure they did not violate the NLRA and to counter
misinformation.\69\
---------------------------------------------------------------------------
\66\Rushing Union Elections: Protecting the Interests of Big Labor
at the Expense of Workers' Free Choice: Hearing before the H. Comm. on
Educ. and the Workforce, 112th Cong., at 3 (2011) (written testimony of
John Carew).
\67\Id.
\68\Id.
\69\Id.
---------------------------------------------------------------------------
At the same hearing, Mr. Larry Getts, an employee of the
Dana Corporation, described his experience with union
organizers:
[Organizers stated] that our shop would make the same
as the workers in the other--much larger--Fort Wayne
plant. . . . [T]hat did not seem plausible because we
were making twelve dollars an hour, and in Fort Wayne
they were making twenty-one dollars an hour. Of course,
much of what they told us proved to be false, but it's
fair to say we weren't lacking information from union
officials.\70\
---------------------------------------------------------------------------
\70\Rushing Union Elections: Protecting the Interests of Big Labor
at the Expense of Workers' Free Choice: Hearing before the H. Comm. on
Educ. and the Workforce, 112th Cong., at 2 (2011) (written testimony of
Larry Getts).
While Mr. Getts stated he and his fellow employees would
have appreciated hearing the views of his employer, he did not
have access to a robust debate.\71\ His employer had signed a
neutrality agreement.\72\ Since he and his fellow employees
were not hearing opposing points of view, Mr. Getts took it
upon himself to research and verify everything they were
told.\73\
---------------------------------------------------------------------------
\71\Id.
\72\Id.
\73\Id.
---------------------------------------------------------------------------
Mr. Raymond LaJeunesse of the National Right to Work Legal
Defense Foundation testified at a February 14, 2017 HELP
Subcommittee hearing that the shortened timeframe will infringe
upon workers' rights: ``[T]he shortened time-frame for
representation elections has adversely affected the ability of
individual employees to fully educate themselves about the pros
and cons of monopoly union representation, and hampered the
ability of employees opposed to union representation to
organize themselves in opposition to unions and timely obtain
legal counsel.''\74\
---------------------------------------------------------------------------
\74\Restoring Balance and Fairness to the National Labor Relations
Board, Hearing before the Subcomm. on Health, Employment, Labor and
Pensions of the H. Comm. on Educ. and the Workforce, 115th Cong., at 10
(2017) (written testimony of Raymond J. LaJeunesse) [hereinafter
LaJeunesse Testimony].
---------------------------------------------------------------------------
While testifying before a June 14, 2017, HELP Subcommittee
legislative hearing on H.R. 2776, labor attorney Mr. Seth H.
Borden noted:
The changes in the 2015 Rule changes were, at best, a
proposed solution in search of a problem. To the extent
they were intended simply to increase union success in
organizing, they did so by limiting employer free
speech rights protected by Section 8(c) of the National
Labor Relations Act . . . and infringing on the Section
7 rights of employees to refrain from union
representation.\75\
---------------------------------------------------------------------------
\75\Legislative Reforms to the National Labor Relations Act: H.R.
2776, Workforce Democracy and Fairness Act; H.R. 2775, Employee Privacy
Protection Act; and, H.R. 2723, Employee Rights Act: Hearing before the
Subcomm. on Health, Employment, Labor and Pensions of the H. Comm. on
Educ. and the Workforce, 115th Cong., at 3 (2017) (written testimony of
Seth Borden) [hereinafter Borden Testimony].
At the same hearing, Ms. Nancy McKeague of the Society for
Human Resource Management also raised concerns about the
ability of employers to properly and legally communicate with
---------------------------------------------------------------------------
their employees during a shortened election. She testified:
The ambush election rule significantly impairs small
employers' ability in responding to petitions in an
accelerated manner and presents significant burdens for
large employers with diverse and significant voting
units. For example, small employers may not have an HR
professional on staff or access to legal counsel that
specializes in labor issues.\76\
---------------------------------------------------------------------------
\76\Legislative Reforms to the National Labor Relations Act: H.R.
2776, Workforce Democracy and Fairness Act; H.R. 2775, Employee Privacy
Protection Act; and, H.R. 2723, Employee Rights Act: Hearing before the
Subcomm. on Health, Employment, Labor and Pensions of the H. Comm. on
Educ. and the Workforce, 115th Cong., at 3 (2017) (written testimony of
Nancy McKeague) [hereinafter McKeague Testimony].
The expedited timeframe for representational elections in
the NLRB's 2015 rule will effectively eliminate employer speech
and deprive employees of the right to make a fully informed
decision on whether to be represented by a labor organization.
Increased Controversy During Representational Elections
The new Statement of Position, combined with the new
timeframe for the start of the pre-election hearing and delays
in unit composition determinations, will increase conflict
between labor and management during representational elections,
thereby decreasing the number of election agreements and
increasing costs for employers and taxpayers.
As outlined above, the rule requires parties to complete a
Statement of Position within seven days of receiving the
election petition. With few exceptions, failure to state a
position precludes a party from raising the issue at the pre-
election hearing. Mr. Robert Sullivan, testifying on behalf of
the Retail Industry Leaders Association (RILA) at an October
12, 2011, hearing stated these requirements ``will wreak havoc
with small and large employers.''\77\ Small employers will have
access to factual information, but they will not have in-house
experts to evaluate the legal issues.\78\ In contrast, large
employers will have the advantage of having in-house experts or
access to outside experts, but their size will complicate legal
issues.\79\
---------------------------------------------------------------------------
\77\H.R. 3094, The Workforce Democracy and Fairness Act:
Legislative Hearing before the H. Committee on Educ. and the Workforce,
112th Cong., at 8 (2011) (written testimony of Robert Sullivan)
[hereinafter Sullivan Testimony].
\78\Id.
\79\Id. at 9.
---------------------------------------------------------------------------
This situation has been further complicated by the
Specialty Healthcare decision. At a Committee hearing on March
5, 2014, entitled ``Culture of Union Favoritism: The Return of
the NLRB's Ambush Election Rule,'' labor attorney Ms. Doreen
Davis highlighted the difficulty of determining whether
employees share an ``overwhelming community of interest'' and
questioned whether seven days provided sufficient time to
prepare for the pre-election hearing:
[U]nder the current rules, sometimes we are required
to [prepare for the pre-election hearing] as soon as 10
days [after the petition for election is filed], but
not 7 days, and under the current rules, we can
litigate at the pre-election conference. . . . We
haven't waived issues that weren't raised in the pre-
election conference. . . . Under the new rules, there
would be no opportunity to do that, unless you had
stated it in your statement of position, which is due
no later than 7 days after the petition is filed. So it
is very challenging for small employers. It is equally
challenging for large employers, because as an outside
counsel, I have to learn their business, how it
operates, which group of employees interact with whom,
which employees have a community of interest with
others. Do they have similar wages, hours, working
conditions, supervision? Is what they do at that
company related to what another employee does and how?
There are many things that have to be learned in order
to effectively represent an employer in these kinds of
proceedings, and that is all being very much short-
circuited under these proposed rules.\80\
---------------------------------------------------------------------------
\80\Culture of Union Favoritism: The Return of the NLRB's Ambush
Election Rule: Hearing before the H. Comm. on Educ. and the Workforce,
113th Cong., (2014). (written testimony of Doreen S. Davis).
With only seven days to prepare the Statement of Position
for the start of the pre-election hearing, there is little
opportunity to reach election agreements.\81\ To ensure no
issues are waived, employers will spend their time preserving
their positions rather than working with the regional director
to reach a voluntary election agreement.\82\ Former NLRB
Chairman Schaumber stated ``the sum total of these rules is you
are going to have far fewer pre-election agreements.''\83\
Unable to secure election agreements, the NLRB will be forced
to hold more pre-election hearings on every possible issue in
controversy, increasing both taxpayer and employer legal costs.
---------------------------------------------------------------------------
\81\Rushing Union Elections: Protecting the Interests of Big Labor
at the Expense of Workers' Free Choice: Hearing before the H. Comm. on
Educ. and the Workforce, 112th Cong., at 44 (2011).
\82\Id.
\83\Rushing Union Elections: Protecting the Interests of Big Labor
at the Expense of Workers' Free Choice: Hearing before the H. Comm. on
Educ. and the Workforce, 112th Cong., at 78-79 (2011).
---------------------------------------------------------------------------
Furthermore, leaving open questions, such as the
composition of the bargaining unit, could result in significant
problems for employers. At a February 14, 2017, HELP
Subcommittee hearing entitled ``Restoring Balance and Fairness
to the National Labor Relations Board,'' attorney Mr. Kurt
Larkin of Hunton and Williams, LLP testified about this issue:
[I]f an employer believes an employee in the proposed
unit is a statutory supervisor, it cannot obtain a
determination whether the individual should be excluded
from the bargaining unit until after the election. This
presents an obvious conundrum for the employer: it can
treat the employee as a supervisor during the campaign,
and risk unfair labor practice liability for doing so,
or it can back off, and lose the ability to campaign
through an individual who may well not even be eligible
to vote.\84\
\84\Restoring Balance and Fairness to the National Labor Relations
Board: Hearing before the Subcomm. on Health, Employment, Labor and
Pensions of the H. Comm. on Educ. and the Workforce, 115th Cong., at 5
(2017) (written testimony of Kurt Larkin) [hereinafter Larkin
Testimony].
---------------------------------------------------------------------------
Delaying unit composition issues until after the election
could increase the number of elections that must be rerun. Pro-
union activity by supervisors may taint the election if
employees falsely conclude the employer favors the union or if
employees support the union out of fear of retaliation.\85\ In
these cases, the Board may set aside an election. Undoubtedly,
pro-union activity by supervisors improperly included in the
bargaining unit will be more common under the proposed rules,
resulting in more elections being set aside. In cases where the
character or scope of the bargaining unit changes
significantly, a number of courts have ordered a new election,
finding that employees were effectively denied the right to
make an informed choice in the representational election.\86\
Every rerun election and unfair labor practice charge will cost
taxpayer dollars and increase employer legal costs.
---------------------------------------------------------------------------
\85\Fall River Sav. Bank v. NLRB, 649 F.2d 50, 56 (1st Cir. 1981).
\86\NLRB v. Lorimar Productions, Inc., 771 F.2d 1294 (9th Cir.
1985); NLRB v. Beverly Health and Rehabilitation Services, 120 F.3d 262
(4th Cir. 1977).
---------------------------------------------------------------------------
Fragmentation of the Workforce
The Specialty Healthcare standard for determining the
composition of an appropriate bargaining unit will allow unions
to gerrymander the bargaining unit, encourage incremental
organizing of units that support unionization, and lead to
fragmentation in the workplace. In his June 2017 testimony, Mr.
Borden summarized the new standard as ``a drastic departure
from the traditional standard employed by the Board for
decades.''\87\
---------------------------------------------------------------------------
\87\Borden, supra note 74 at 7.
---------------------------------------------------------------------------
As noted above, under the new standard, regional directors
will be compelled to approve any unit supported by the union,
and employer challenges will be difficult, if not impossible,
permitting unions to limit organizing to those employees
supporting the union.\88\ Mr. Larkin stated the new standard
has ``the practical effect of allowing unions to seek
bargaining units that reflect little more than the extent to
which they have been successful in recruiting employees who
support unionization.''\89\
---------------------------------------------------------------------------
\88\Specialty Healthcare, 357 NLRB No. 83, 19.
\89\Larkin, supra note 84 at 9.
---------------------------------------------------------------------------
As a result, instead of one unit, employers have to bargain
with multiple units, increasing fragmentation and labor costs.
As the number of units within a business increases, labor costs
and the risk of strikes increase. Rather than negotiating once
every three years, the employer may be forced to negotiate
collective bargaining agreements every year or multiple times a
year. Each negotiation includes the possibility of a strike,
disrupting operations and damaging customer relations.\90\
---------------------------------------------------------------------------
\90\Sullivan, supra note 77 at 4.
---------------------------------------------------------------------------
Moreover, this new standard is detrimental to workers.
Drawing lines between departments limits flexibility and
employee opportunities. As explained by Mr. Robert Sullivan
during the October 12, 2011, Committee hearing, if employees
are divided by department, such as sporting goods divided from
housewares, employers will not be able to move employees
between departments in response to changes in demand, and
employees will not be able to pick up shifts in other
departments.\91\ Additionally, opportunities for advancement
into management would be limited without cross-training.\92\
Ms. McKeague noted in her June 2017 testimony before the HELP
Subcommittee that the Specialty Healthcare standard
``discourages teamwork rather than offering solutions that
balance the needs of an individual department with the needs of
the whole operation.''\93\ In February 2017, Mr. LaJeunesse
further detailed the impact on workers at a HELP Subcommittee
hearing. He testified that Specialty Healthcare ``wrongfully
elevated employees' right to unionize above employees' equal
right to oppose unionization.''\94\
---------------------------------------------------------------------------
\91\Id.
\92\Id.
\93\McKeague, supra note 75 at 7.
\94\LaJeunesse, supra note 76 at 5.
---------------------------------------------------------------------------
D. Necessary Legislation To Address NLRB Actions
Congress is responsible for establishing and revising
standards in federal labor law. The NLRB's decision in
Specialty Healthcare and its ambush election rule will limit
employee free choice and employer free speech, and fragment the
workforce. The Workforce Democracy and Fairness Act reverses
the NLRB's August 26, 2011, decision in Specialty Healthcare
and the ambush election rule without upsetting other standards
under current law.
To ensure parties can dispute union-proposed bargaining
units, the Workforce Democracy and Fairness Act will codify the
test used prior to Specialty Healthcare. Bargaining units will
again be comprised of employees that share a ``sufficient
community of interest.'' In determining whether employees share
a ``sufficient community of interest,'' the Board will weigh
eight factors including similarity of wages, working
conditions, and skills. The Board will not exclude employees
from the unit unless the interests of the group sought are
sufficiently distinct from those of included employees to
warrant the establishment of a separate unit. Any party seeking
to enlarge the proposed bargaining unit must demonstrate that
employees in the larger unit share a ``sufficient community of
interest'' with those in the proposed unit, not an
``overwhelming community of interest.'' These provisions of the
Workforce Democracy and Fairness Act will limit fragmentation,
ensure employer flexibility and greater employee opportunities,
and reduce labor costs.
The Workforce Democracy and Fairness Act also addresses the
shortcomings of the NLRB's ambush election rule. More
specifically, the Act addresses:
Voter Eligibility. To ensure employees and
employers know who will be in their bargaining unit and
avoid complications on eligibility (i.e., whether an
employee is a supervisor) the Board shall determine the
appropriate bargaining unit prior to an election.
Scheduling of Pre-Election Hearing. The
regional director will have discretion as to when the
pre-election hearing shall begin, but parties will have
at least 14 days to prepare for the pre-election
hearing. Employers will have at least 14 days to hire
an attorney, identify issues, and prepare their case
for the pre-election hearing. The 14 day time period
gives unions, employers, and the NLRB an opportunity to
compromise and reach an election agreement.
Identifying Issues in Dispute. Employers and
unions will be allowed to raise independently any
relevant and material issue or assert any relevant and
material position at any time prior to the close of the
hearing. Employers and unions will be free to raise
issues as the hearing record develops, ensuring a fair
and effective pre-election hearing. To ensure parties
do not inappropriately delay elections, issues
traditionally excluded from pre-election hearings, such
as the eligibility of employees for union membership,
may only be raised after the election.
Timing of Election. Providing the time
necessary for employees to understand the costs and
benefits of unionization is essential to free choice.
In 1959, then-Senator John F. Kennedy stated during the
debate over amendments to the NLRA that at least 30
days were required between the petition's filing and
the election to ``safeguard against rushing employees
into an election where they are unfamiliar with the
issues.''\95\ For all petitions filed in the last full
year before the ambush election rule took effect, the
median time from the filing of a petition to an
election was 38 days.\96\ Under the legislation, the
NLRB will conduct an election as soon as practicable,
but no less than 35 calendar days following the filing
of an election petition. Employers will have time to
educate employees, and employees will have time to
effectively judge whether they wish to be represented
by a union.
---------------------------------------------------------------------------
\95\105 Cong. Rec. 5361 (1959).
\96\NLRB, MEDIAN DAYS FROM PETITION TO ELECTION (2017), https://
www.nlrb.gov/news-outreach/graphs-data/petitions-and-elections/median-
days-petition-election.
---------------------------------------------------------------------------
Post-election Board Review. To ensure
uniformity and due process, parties may petition the
Board for post-election review of the regional
director's decision.
In sum, the Workforce Democracy and Fairness Act will
ensure employers have adequate time to communicate with their
employees and employees have the time and information necessary
to make fully informed decisions about unionization.
Conclusion
Over the last several years, the NLRB has issued multiple
decisions and rules intended to unbalance labor relations to
benefit organized labor. The two most significant examples are
the Board's holding in Specialty Healthcare and its ambush
election rule. Together, these actions fragment workplaces,
increase labor costs and strife, and limit employer free speech
and employee free choice. The Workforce Democracy and Fairness
Act will return balance to labor relations by restoring a fair
election process for unions, employers, and employees.
Section-by-Section Analysis
The following is a section-by-section analysis of the
Amendment in the Nature of a Substitute to H.R. 2776 as offered
by HELP Subcommittee Chairman Walberg and reported favorably by
the Committee.
Section 1. Provides that the short title is the
``Workforce Democracy and Fairness Act.''
Section 2. Amends the National Labor Relations Act to
reverse the December 14, 2015, final representation-
case procedures rule.
Section 3. Amends the National Labor Relations Act to
reverse the holding in Specialty Healthcare.
Explanation of Amendments
The amendments, including the amendment in the nature of a
substitute, are explained in the body of this report.
Application of Law to the Legislative Branch
Section 102(b)(3) of Public Law 104-1 requires a
description of the application of this bill to the legislative
branch. H.R. 2776, the Workforce Democracy and Fairness Act,
reverses the NLRB's August 26, 2011, decision in Specialty
Healthcare and reverses the NLRB's December 15, 2014, final
ambush election rule.
Unfunded Mandate Statement
Section 423 of the Congressional Budget and Impoundment
Control Act (as amended by Section 101(a)(2) of the Unfunded
Mandates Reform Act, P.L. 104-4) requires a statement of
whether the provisions of the reported bill include unfunded
mandates. This issue is addressed in the CBO letter.
Earmark Statement
H.R. 2776 does not contain any congressional earmarks,
limited tax benefits, or limited tariff benefits as defined in
clause 9 of House Rule XXI.
Roll Call Votes
Clause 3(b) of rule XIII of the Rules of the House of
Representatives requires the Committee Report to include for
each record vote on a motion to report the measure or matter
and on any amendments offered to the measure or matter the
total number of votes for and against and the names of the
Members voting for and against.
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Statement of General Performance Goals and Objectives
In accordance with clause (3)(c) of House Rule XIII, the
goals of H.R. 2776 are to ensures cohesion in the workplace,
employee free choice, and employer free speech.
Duplication of Federal Programs
No provision of H.R. 2776 establishes or reauthorizes a
program of the Federal Government known to be duplicative of
another Federal program, a program that was included in any
report from the Government Accountability Office to Congress
pursuant to section 21 of Public Law 111-139, or a program
related to a program identified in the most recent Catalog of
Federal Domestic Assistance.
Disclosure of Directed Rule Makings
The Committee estimates that enacting H.R. 2776 does not
specifically direct the completion of any specific rule makings
within the meaning of 5 U.S.C. 551.
Statement of Oversight Findings and Recommendations of the Committee
In compliance with clause 3(c)(1) of rule XIII and clause
2(b)(1) of rule X of the Rules of the House of Representatives,
the Committee's oversight findings and recommendations are
reflected in the body of this report.
New Budget Authority and CBO Cost Estimate
With respect to the requirements of clause 3(c)(2) of rule
XIII of the Rules of the House of Representatives and section
308(a) of the Congressional Budget Act of 1974 and with respect
to requirements of clause 3(c)(3) of rule XIII of the Rules of
the House of Representatives and section 402 of the
Congressional Budget Act of 1974, the Committee has received
the following estimate for H.R. 2776 from the Director of the
Congressional Budget Office:
U.S. Congress,
Congressional Budget Office,
Washington, DC, July 21, 2017.
Hon. Virginia Foxx,
Chairwoman, Committee on Education and the Workforce,
House of Representatives, Washington, DC.
Dear Madam Chairwoman: The Congressional Budget Office has
prepared the enclosed cost estimate for H.R. 2776, the
Workforce Democracy and Fairness Act.
If you wish further details on this estimate, we will be
pleased to provide them. The CBO staff contact is Christina
Hawley Anthony.
Sincerely,
Mark P. Hadley
(For Keith Hall, Director).
Enclosure.
H.R. 2776--Workforce Democracy and Fairness Act
H.R. 2776 would amend the National Labor Relations Act to
require the National Labor Relations Board to delay, for at
least 14 days after a petition is filed, hearings on petitions
by employees or employers for representation in collective
bargaining. The bill also would set certain requirements for
pre-election hearings. In addition, secret ballot elections
could be held no earlier than 35 days after an election
petition is filed. CBO estimates that enacting H.R. 2776 would
not affect the federal budget.
Enacting the bill would not affect direct spending or
revenues; therefore, pay-as-you-go procedures do not apply. CBO
estimates that enacting H.R. 2776 would not increase net direct
spending or on-budget deficits in any of the four consecutive
10-year periods beginning in 2028.
The bill contains no intergovernmental or private-sector
mandates as defined in the Unfunded Mandates Reform Act and
would impose no costs on state, local, or tribal governments.
The CBO staff contact for this estimate is Christina Hawley
Anthony. The estimate was approved by H. Samuel Papenfuss,
Deputy Assistant Director for Budget Analysis.
Committee Cost Estimate
Clause 3(d)(1) of rule XIII of the Rules of the House of
Representatives requires an estimate and a comparison of the
costs that would be incurred in carrying out H.R. 2776.
However, clause 3(d)(2)(B) of that rule provides that this
requirement does not apply when the Committee has included in
its report a timely submitted cost estimate of the bill
prepared by the Director of the Congressional Budget Office
under section 402 of the Congressional Budget Act.
Changes in Existing Law Made by the Bill, as Reported
In compliance with clause 3(e) of rule XIII of the Rules of
the House of Representatives, changes in existing law made by
the bill, as reported, are shown as follows (new matter is
printed in italic and existing law in which no change is
proposed is shown in roman):
Changes in Existing Law Made by the Bill, as Reported
In compliance with clause 3(e) of rule XIII of the Rules of
the House of Representatives, changes in existing law made by
the bill, as reported, are shown as follows (existing law
proposed to be omitted is enclosed in black brackets, new
matter is printed in italic, and existing law in which no
change is proposed is shown in roman):
NATIONAL LABOR RELATIONS ACT
* * * * * * *
representatives and elections
Sec. 9. (a) Representatives designated or selected for the
purposes of collective bargaining by the majority of the
employees in a unit appropriate for such purposes, shall be the
exclusive representatives of all the employees in such unit for
the purposes of collective bargaining in respect to rates of
pay, wages, hours of employment, or other conditions of
employment: Provided, That any individual employees or a group
of employees shall have the right at any time at present
grievances to their employer and to have such grievances
adjusted, without the intervention of the bargaining
representative, as long as the adjustment is not inconsistent
with the terms of a collective-bargaining contract or agreement
then in effect: Provided further, That the bargaining
representative has been given opportunity to be present at such
adjustment.
(b) [The Board shall decide in each case whether, in order to
assure to employees the fullest freedom in exercisiong the
rights guaranteed by this Act, the unit appropriate for the
purposes of collective bargaining shall be the employer unit,
craft unit, plant unit, or subdivision thereof:] (1) In each
case, prior to an election, the Board shall determine, in order
to assure to employees the fullest freedom in exercising the
rights guaranteed by this Act, the unit appropriate for the
purposes of collective bargaining. Unless otherwise stated in
this Act, and excluding any bargaining unit determination
promulgated through rulemaking before August 26, 2011, the unit
appropriate for purposes of collective bargaining shall consist
of employees that share a sufficient community of interest. In
determining whether employees share a sufficient community of
interest, the Board shall consider--
(A) similarity of wages, benefits, and working
conditions;
(B) similarity of skills and training;
(C) centrality of management and common supervision;
(D) extent of interchange and frequency of contact
between employees;
(E) integration of the work flow and
interrelationship of the production process;
(F) the consistency of the unit with the employer's
organizational structure;
(G) similarity of job functions and work; and
(H) the bargaining history in the particular unit and
the industry.
To avoid the proliferation or fragmentation of bargaining
units, no employee shall be excluded from the unit unless the
interests of the group seeking a separate unit are sufficiently
distinct from those of other employees to warrant the
establishment of a separate unit. Whether additional employees
should be included in a proposed unit shall be determined based
on whether such additional employees and proposed unit members
share a sufficient community of interest, with the sole
exception of proposed accretions to an existing unit, in which
the inclusion of additional employees shall be based on whether
such additional employees and existing unit members share an
overwhelming community of interest and the additional employees
have little or no separate identity.
(2) [Provided, That the Board] The Board shall not
[(1)] (A) decide that any unit is appropriate for such
purposes if such unit includes both professional
employees and employees who are not professional
employees unless a majority of such professional
employees vote for inclusion in such unit; or [(2)] (B)
decide that any craft unit is inappropriate for such
purposes on the ground that a different unit has been
established by a prior Board determination, unless a
majority of the employees in the proposed craft unit
vote against separate representation or [(3)] (C)
decide that any unit is appropriate for such purposes
if it includes, together with other employees, any
individual employed as a guard to enforce against
employees and other persons rules to protect property
of the employer or to protect the safety of persons on
the employer's premises; but no labor organization
shall be certified as the representative of employees
in a bargaining unit of guards if such organization
admits to membership, or is affiliated directly or
indirectly with an organization which admits to
membership, employees other than guards.
(c)(1) Whenever a petition shall have been filed, in
accordance with such regulations as may be prescribed by the
Board--
(A) by an employee or group of employees or any
individual or labor organization acting in their behalf
alleging that a substantial number of employees (i)
wish to be represented for collective bargaining and
that their employer declines to recognize their
representative as the representative defined in section
9(a), or (ii) assert that the individual or labor
organization, which has been certified or is being
currently recognized by their employer as the
bargaining representative, is no longer a
representative as defind in section 9(a); or
(B) by an employer, alleging that one or more
individuals or labor organizations have presented to
him a claim to be recognized as the representative
defined in section 9(a);
the Board shall investigate such petition and if it has
reasonable cause to believe that a question of representation
affecting commerce exists shall provide for an appropriate
hearing upon due notice, but in no circumstances less than 14
calendar days after the filing of the petition. Such hearing
may be conducted by an officer or employee of the regional
office, who shall not make any recommendations with respect
thereto. An appropriate hearing shall be one that is non-
adversarial with the hearing officer charged, in collaboration
with the parties, with the responsibility of identifying any
relevant and material pre-election issues and thereafter making
a full record thereon. Relevant and material pre-election
issues shall include, in addition to unit appropriateness, the
Board's jurisdiction and any other issue the resolution of
which may make an election unnecessary or may reasonably be
expected to impact the outcome of the election. Parties may
independently raise any relevant and material pre-election
issue or assert any relevant and material position at any time
prior to the close of the hearing. If the Board finds upon the
record of such hearing that such a question of representation
exists, it shall direct an election by secret ballot [and shall
certify the results thereof] to be conducted as soon as
practicable but no earlier than 35 calendar days after the
filing of an election petition. The Board shall certify the
results of the election after it has ruled on each pre-election
issue not resolved before the election and any additional issue
pertaining to the conduct or results of the election.
(2) In determining whether or not a question or
representation affecting commerce exists, the same regulations
and rules of decision shall apply irrespective of the identity
of the persons filing the petition or the kind of relief sought
and in no case shall the Board deny a labor organization a
place on the ballot by reason of an order with respect to such
labor organization or its predecessor not issued in conformity
with section 10(c).
(3) No election shall be directed in any bargaining unit or
any subdivision within which, in the preceding twelve-month
period, a valid election shall have been held. Employees
engaged in an economic strike who are not entitled to
reinstatement shall be eligible to vote under such regulations
as the Board shall find are consistent with the purposes and
provisions of this Act in any election conducted within twelve
months after the commencement of the strike. In any election
where none of the choices on the ballot receives a majority, a
run-off shall be conducted, the ballot providing for a
selection between the two choices receiving the largest and
second largest number of valid votes cast in the election.
(4) Nothing in this section shall be construed to prohibit
the waiving of hearings by stipulation for the purpose of a
consent election in conformity with regulations and rules of
decision of the Board.
(5) In determining whether a unit is appropriate for the
purposes specified in subsection (b) the extent to which the
employees have organized shall not be controlling.
(d) Whenever an order of the Board made pursuant to section
10(c) is based in whole or in part upon facts certified
following an investigation pursuant to subsection (c) of this
section and there is a petition for the enforcement or review
of such order, such certification and the record of such
investigatioon shall be included in the transcript of the
entire record required to be filed under section 10(e) or
10(f), and thereupon the decree of the court enforcing,
modifying, or setting aside in whole or in part the order of
the Board shall be made and entered upon the pleadings,
testimony, and proceedings set forth in such transcript.
(e)(1) Upon the filing with the Board, by 30 per centum or
more of the employees in a bargaining unit covered by an
agreement between their employer and a labor organization made
pursuant to section 8(a)(3), of a petition alleging they desire
that such authority be rescinded, the Board shall take a secret
ballot of the employees in such unit and certify the results
thereof to such labor organization and to the employer.
(2) No election shall be conducted pursuant to this
subsection in any bargaining unit or any subdivision within
which, in the preceding twelve-month period, a valid election
shall have been held.
* * * * * * *
MINORITY VIEWS
The deceptively-named ``Workforce Democracy and Fairness
Act'' is designed to deny private-sector workers a right to a
fair union representation election by mandating unnecessary
pre-election delays, encouraging additional delays through
wasteful and frivolous litigation, and empowering employers to
gerrymander the bargaining unit selected by the workers in
order to dilute the voting strength of workers who want to form
a union.
A worker's right to join a union and collectively bargain
is among the most effective means to grow the middle class and
reduce income inequality.\1\ The majority has advanced H.R.
2776 at a time of soaring income inequality, attributable, in
part, to the decline of private-sector union membership. This
bill specifically targets the right to join a union by
undermining the union representation election process. Instead
of raising wages and empowering employees, H.R. 2776 tilts the
playing field against workers who want to organize a union.
---------------------------------------------------------------------------
\1\Ross Eisenbrey and Colin Gordon, As Unions Decline, Inequality
Rises, Economic Policy Institute, June 6, 2012 http://www.epi.org/news/
union-membership-declines-inequality-rises/.
---------------------------------------------------------------------------
The bill was approved with 22 Republicans to 16 Democrats,
with all Democrats present opposing the bill on a roll call
vote.
H.R. 2776 OVERTURNS KEY PARTS OF THE NLRB'S 2015 ELECTION RULE BY
MANDATING DELAYS
The National Labor Relations Board's (NLRB) 2015 election
rule updated union election procedures to increase transparency
and reduce wasteful litigation that stalls the election
process. Unnecessary procedural delays enable employers to have
more time to campaign against the union, and research shows
that employers often use that time to engage in coercive
tactics against workers seeking to unionize.\2\ By streamlining
the union election process, the 2015 election rule best
effectuates the stated purpose of the National Labor Relations
Act (NLRA): to ``encourag[e] the practice and procedure of
collective bargaining'' and ``protect[] the exercise by workers
of full freedom of association.''\3\
---------------------------------------------------------------------------
\2\NO HOLDS BARRED: The Intensification of Employer Opposition to
Organizing, Kate Bronfenbrenner, Director, Labor Education and
Research, Cornell School of Industrial and Labor Relations, May 20,
2009 http://www.epi.org/files/page/-/pdf/bp235.pdf.
\3\29 U.S.C. Sec. 151.
---------------------------------------------------------------------------
Under the 2015 election rule, when a union files a petition
for a union election, the regional office must schedule a pre-
election hearing eight days from the date of the petition.\4\
This rule harmonizes the practices of various regional offices;
prior to 2015, the regions scheduled hearings using various
timelines. The 2015 election rule also narrowed the scope of
permissible issues that could be litigated in a pre-election
hearing to reduce pre-election delays and avoid wasteful
litigation.\5\ Before 2015, the employer could insist on
litigating any issue of voter eligibility. The pre-election
hearing now focuses on issues that are necessary to determine
whether it is appropriate to conduct the election at all. This
way, litigation regarding individual voters' eligibility is
postponed to after the election, when many disputes can be
mooted if their outcome is not enough to change the results of
the election. Once the pre-election disputes are resolved, the
NLRB's 2015 rule requires the election to be held as soon as
practicable, in order for the elections to be conducted
efficiently.\6\
---------------------------------------------------------------------------
\4\29 C.F.R. Sec. 102.63(a)(1).
\5\29 C.F.R. Sec. 102.64(a).
\6\29 C.F.R. Sec. 102.67(b).
---------------------------------------------------------------------------
The NLRB's election procedures are now settled law: every
court where the 2015 election rule has been challenged has
upheld the rule.\7\ For example, as the Fifth Circuit Court of
Appeals held with regards to the suit filed by the Associated
Builders and Contractors (ABC) of Texas:
---------------------------------------------------------------------------
\7\Associated Builders & Contractors of Texas, Inc. v. NLRB, 826
F.3d 215 (5th Cir. 2016); affirming 1-15-CV-026, U.S. Dist. LEXIS 78890
(W.D. Tex. June 1, 2015); Chamber of Commerce of the United States of
America v. NLRB, 118 F. Supp. 3d 171 (D.D.C. 2015).
[The Board] conducted an exhaustive and lengthy
review of the issues, evidence, and testimony,
responded to contrary arguments, and offered factual
and legal support for its final conclusions. Because
the Board acted rationally and in furtherance of its
congressional mandate in adopting the rule, the ABC
entities' challenge to the rule as a whole fails.\8\
---------------------------------------------------------------------------
\8\Associated Builders & Contractors of Texas, Inc., 826 F.3d at
229 (5th Cir. 2016).
Similarly, the U.S. District Court for the District of
---------------------------------------------------------------------------
Columbia held:
Congress authorized the Board ``to make, amend, and
rescind . . . such rules and regulations as may be
necessary to carry out the provisions of the NLRA.''
Plaintiffs complain that ``the hundreds of pages in the
Board's Final Rule contain remarkably little logic or
sound explanation for the sweeping changes made by the
Final Rule,'' but in reality, the Board engaged in a
comprehensive analysis of a multitude of issues
relating to the need for and the propriety of the Final
Rule, and it directly addressed the commenters' many
concerns, including a number of the arguments
plaintiffs raised here.\9\
---------------------------------------------------------------------------
\9\Chamber of Commerce, 118 F. Supp. 3d at 220 (quoting 29 U.S.C.
Sec. 156 and plaintiff's motion for summary judgment, respectively).
The failure of these court challenges to the rule has
prompted this legislation to overturn the 2015 NLRB election
rule.
H.R. 2776 targets the 2015 election rule by replacing the
8-day deadline for pre-election hearings with a 14-day delay
before the hearing. It would also prohibit the NLRB from
holding any union election sooner than 35 days after the filing
of a petition for an election, even if there are no pre-
election matters in dispute. This undermines the parties' free
choice: in over 90 percent of union elections, the parties
themselves agreed to when the election would occur and who is
eligible to vote.\10\ During the hearing, the Majority did not
articulate any reason to interfere in these agreements by
forcing unnecessary delay.
---------------------------------------------------------------------------
\10\Percentage of Elections Conducted Pursuant to Election
Agreements in FY16, NLRB https://www.nlrb.gov/news-outreach/graphs-
data/petitions-and-elections/percentage-elections-conducted-pursuant-
election (last accessed Jul. 7, 2017).
---------------------------------------------------------------------------
Committee Republicans at the June 29, 2017 markup echoed
anti-union business groups in describing the NLRB's 2015
election rule as an ``ambush election rule . . . designed to
rush employees into union elections.''\11\ Indeed, when the
D.C. District Court considered the Chamber of Commerce's
challenge to the rule, it noted that the Chamber ``rel[ied]
heavily on the repetition of disparaging labels, referring to
the Final rule as the `ambush' or `quickie' election
rule.''\12\ The court found that ``[t]his tendency to speak in
broad terms'' ignored how, ``when one descends to the level of
the particular, the provisions at issue are not quite as
described. On its face, the Final Rule does not necessarily
lead to the outcomes to which plaintiffs object . . . .''\13\
By replacing the NLRB's common sense 2015 election rule with
mandatory delays, H.R. 2776 serves no useful purpose other than
to buy employers more time to chill employee support for a
union.
---------------------------------------------------------------------------
\11\Address of Chairwoman Virginia Foxx at U.S. House of
Representatives Committee on Education and the Workforce Markup (June
29, 2017) https://edworkforce.house.gov/calendar/
eventsingle.aspx?EventID=401796.
\12\Chamber of Commerce, 118 F. Supp. 3d at 189.
\13\Chamber of Commerce, 118 F. Supp. 3d at 189.
---------------------------------------------------------------------------
H.R. 2776 OVERTURNS PARTS OF THE NLRB ELECTION RULE THAT STREAMLINES
THE HEARING PROCESS AND CREATES OPPORTUNITIES FOR WASTEFUL LITIGATION
AND AMBUSH HEARINGS
H.R. 2776 expands the issues that parties can litigate
prior to the election. Where the 2015 election rule reduced
wasteful litigation by delaying issues that could be mooted by
the election's outcome, H.R. 2776 now allows parties to raise
any pre-election issue that ``may reasonably be expected to
impact the outcome of the election.'' This provision allows
employers to raise issues that have no bearing on whether there
is an appropriate bargaining unit. Thus, it grants employers
the ability to extend hearings for weeks on end to buy time to
chill the workers' organizing drive or pressure them from
organizing. This is not a one-sided concern: unions facing
decertification campaigns could use the same delaying tactics.
Any issues even remotely work-related, from unfair treatment by
supervisors to the accuracy of campaign flyers, can be
considered reasonably expected to impact the election's
outcome'' and therefore be raised during a hearing. It is
foreseeable that the NLRB will be burdened with a docket
clogged with cases containing irrelevant issues having nothing
to do with whether to conduct an election, or how to define an
appropriate bargaining unit. This will further stall review
efforts, which in turn will prevent elections from being held.
H.R. 2776 also allows ambush hearings by allowing parties
``to raise any issue or assert any position at any time prior
to the close of the hearing.'' The NLRB's 2015 election rules
require parties to declare all of the issues to be litigated at
the outset of a hearing, as is commonly done in civil
litigation, to assure orderly proceedings.\14\ H.R. 2776
overturns that rule.
---------------------------------------------------------------------------
\14\29 C.F.R. Sec. 102.63(b).
---------------------------------------------------------------------------
H.R. 2776 UNDERMINES EMPLOYEES' RIGHT TO FULL FREEDOM OF ASSOCIATION BY
EMPOWERING EMPLOYERS TO GERRYMANDER THE COMPOSITION OF THE BARGAINING
UNIT
H.R. 2776 establishes an entirely new regime that would
give employers, instead of employees, the dominant voice in
determining who should be included and who should be excluded
in a bargaining unit. The bill allows employers to dilute the
percentage of employees interested in forming a union by
expanding the pool of eligible voters with employees who have
expressed no interest in joining a union. Employer
gerrymandering rigs the NLRB's election process and makes it
much harder for employees to win a union.
After a union files its petition for an election,
including signatures demonstrating a showing of interest of at
least 30 percent of the employees, the NLRB applies its
traditional two-step process to resolve disputes regarding
whether the bargaining unit that the union petitioned for is
appropriate.\15\
---------------------------------------------------------------------------
\15\Specialty Healthcare, 357 NLRB 934 (2011), enforced sub nom
Kindred Nursing Centers East, LLC v. NLRB, 727 F.3d 552 (6th Cir.
2013).
---------------------------------------------------------------------------
First, the NLRB determines whether the unit
is a readily identifiable group sharing a ``community
of interest'' using factors such as similarity of
wages, hours, terms and conditions of employment, and
supervision.\16\
---------------------------------------------------------------------------
\16\Other factors can include ``whether the employees are organized
into a separate department; have distinct skills and training; have
distinct job functions and perform distinct work, including inquiry
into the amount and type of job overlap between classifications; are
functionally integrated with the Employer's other employees; have
frequent contact with other employees; [and] interchange with other
employees.'' Specialty Healthcare, 357 NLRB at 942 (quoting United
Operations, Inc., 338 NLRB 123, 123 (2002)).
---------------------------------------------------------------------------
Second, assuming the unit shares a
``community of interest,'' if the employer contends
additional employees should be added to the unit, then
the NLRB looks at whether the employees in the unit
share an ``overwhelming community of interest'' such
that there ``is no legitimate basis upon which to
exclude certain employees from it.''\17\
---------------------------------------------------------------------------
\17\Specialty Healthcare, 357 NLRB at 944.
---------------------------------------------------------------------------
Various units are potentially appropriate for collective
bargaining. The union need only petition for an appropriate
unit, not the single most appropriate unit, or even the largest
one.\18\
---------------------------------------------------------------------------
\18\Id. at 940.
---------------------------------------------------------------------------
The bill undermines this traditional analysis by lowering
the standard the employer needs to meet in order for employees
to be added to the unit. H.R. 2776 allows an employer to
override the union's petitioned-for unit and require that
employees be added if they can be shown to also share a
community of interest, but without regard to whether this is
how the workers chose to freely associate. This change could
head off an election by diluting the percentage of employees
interested in forming a union to below the 30 percent threshold
required for a showing of interest. Even if an election occurs,
the ballot box will be stuffed with votes from workers who had
no interest in forming a union at the outset, but were added to
the voter pool to advance the employer's efforts to defeat the
union. This bill shifts the burden of proof on employees to
justify why the employer cannot simply dilute a proposed
bargaining unit with workers who had no interest in organizing.
The practical impact of this bill is that employers will
find it much easier to gerrymander bargaining units to
determine who can vote in a union election--presumably to
either prevent an election or reduce the union's chances of
victory.
This provision has been advanced by employer interests
under the guise of overturning the NLRB's 2011 Specialty
Healthcare decision, which clarified the NLRB's traditional
two-step analysis. Committee Republicans inaccurately contend
that this decision created a new standard for determining an
appropriate bargaining unit that creates ``micro-units'' and
allows unions to gerrymander bargaining units. Alarmist
warnings of a proliferation of ``micro-units'' have not
materialized, as the median bargaining unit size approved by
the NLRB has remained unchanged since the 2011 decision.
------------------------------------------------------------------------
Median Bargaining Unit
Fiscal Year Size Approved by NLRB
(Source: NLRB)
------------------------------------------------------------------------
FY 2007....................................... 24
FY 2008....................................... 26
FY 2009....................................... 24
FY 2010....................................... 27
FY 2011....................................... 26
FY 2012....................................... 28
FY 2013....................................... 24
FY 2014....................................... 26
FY 2015....................................... 25
FY 2016....................................... 26
------------------------------------------------------------------------
As the chart illustrates, the median bargaining unit size
was 26 three years before the Specialty Healthcare was decided,
it was 26 when the decision was issued in 2011, and it was
unchanged at 26 in 2016, five years later.\19\
---------------------------------------------------------------------------
\19\Median Size of Bargaining Units in Elections, NLRB https://
nlrb.gov/news-outreach/graphs-data/petitions-and-elections/median-size-
bargaining-units-elections (last accessed Jul. 8, 2017).
---------------------------------------------------------------------------
The NLRB's traditional two-step analysis is not new:
Specialty Healthcare, which was affirmed by the Sixth Circuit
Court of Appeals, only clarified the NLRB's existing standard.
The D.C. Circuit previously articulated the same test and noted
the Board's decades-long precedent using that test.\20\ Eight
separate Courts of Appeals have subsequently considered
Specialty Healthcare and held that the NLRB merely ``laid out
the traditional standard,''\21\ and, on June 19, 2017, the U.S.
Supreme Court declined to hear a case challenging the two-prong
test outlined above involving a Macy's department store.\22\
---------------------------------------------------------------------------
\20\Blue Man Vegas, LLC v. NLRB, 529 F.3d 417 (D.C. Cir. 2008).
\21\Macy's, Inc. v. NLRB, 824 F.3d 557, 567 (5th Cir. 2016)
(internal citation omitted); see also Rhino Northwest, LLC v. NLRB,
Case Nos. 16-1089, 16-1115, 2017 U.S. App. LEXIS 14884 (D.C. Cir. Aug.
11, 2017) (``Throughout, the Board's approach has remained
fundamentally the same . . . We thus join seven of our sister circuits
in concluding that Specialty Healthcare worked no departure from prior
Board decisions.'') (internal citations omitted); Constellation Brands,
Inc. v. NLRB, 842 F.3d 784, 792 (2d Cir. 2016) (the standard is
``consistent with earlier Board precedents''); FedEx Freight, Inc. v.
NLRB, 839 F.3 636, 639 (7th Cir. 2016) (the standard is ``not the
invention of the Specialty Healthcare case''); NLRB v. FedEx Freight,
Inc., 832 F.3d 432, 442 (3d Cir. 2016) (``The Board's citation to and
approval of the D.C. Circuit's understanding of Board precedent was not
the adoption of new law''); Nestle Dreyer's Ice Cream Co. v. NLRB, 821
F.3d 489, 500 (4th Cir. 2016) (``[T]he Board clarified--rather than
overhauled--its unit-determination analysis.''); FedEx Freight, Inc. v.
NLRB, 816 F.3d 515, 523 (8th Cir. 2016) (``The precedents relied on by
the Board in Specialty Healthcare make clear that the Board does not
look at the proposed unit in isolation.''), reh'g and reh'g en banc
denied (May 26, 2016); Kindred Nursing Centers East, LLC, 727 F.3d 552,
561 (6th Cir. 2013) (``The Board has used the overwhelming-community-
of-interest standard before, so its adoption in Specialty Healthcare is
not new.'').
\22\ See Macy's Inc. v. NLRB, No. 16-1016, U.S. Sup (June 19,
2017).
---------------------------------------------------------------------------
The Majority's allegations that the Specialty Healthcare
decision enables ``union gerrymandering'' of a bargaining unit
are also unfounded. Section 9(c)(5) of the NLRA specifically
states that ``the extent to which the employees have organized
shall not be controlling'' when determining ``whether a unit is
appropriate.'' Union gerrymandering is therefore prohibited,
and Specialty Healthcare complements Section 9(c)(5) by
precluding employer gerrymandering. H.R. 2776 disrupts settled
law by allowing employers to rig union elections in their own
favor.
H.R. 2776 thus undermines the very right to organize a
union by replacing the ``overwhelming community of interest''
standard and requiring that any additional employees with a
mere community of interest be added to the voting pool upon the
request of the employer. By attacking the NLRB's traditional
standard and creating a controversy where none exists,
Committee Republicans hope to use this as an opening to rewrite
the National Labor Relations Act to de-unionize the economy.
Committee Democrats Offer Amendments to H.R. 2776
Democrats offered the following amendments to H.R. 2776 at
the June 29, 2017 markup:
Amendment 1--To eliminate the 35-day waiting period for an election
In order to prevent needless delays in conducting
elections, Representative Frederica S. Wilson proposed an
amendment to strike the text that requires an election to be
delayed for at least 35 days from the date the petition was
filed when a party contests a pre-election issue. This
amendment would restore the current NLRB election rule so an
election would be conducted as soon as practicable following
the pre-election hearing (consistent with the requirement that
a notice of election is posted for three days prior to the
election). While H.R. 2776 prescribes minimum delays, there is
no provision in the bill to limit the time that an election can
be delayed.
This amendment was rejected 16-22.
Amendment 2--To replace the 14-day waiting period for a pre-election
hearing with an 8-day deadline
In order to prevent needless delays in conducting
elections, Representative Adriano Espaillat proposed an
amendment to require a pre-election hearing to be held 8 days
after the date the petition was filed, replacing text requiring
that a pre-election hearing be delayed for at least 14 days
from the date of the petition. This amendment would codify the
current NLRB election rule that went into effect in April 2015.
H.R. 2776 allows open-ended delays in holding pre-election
hearings, while also prescribing a longer minimum time period
before pre-election hearings can be held.
This amendment was rejected 16-22.
Amendment 3--To prevent employers from withdrawing recognition of a
union without an election
In order to promote workforce democracy and fairness, as
the bill purports, Representative Joe Courtney proposed an
amendment to prohibit employers from withdrawing recognition of
the union that was originally certified through an election
without first conducting a decertification election. Under
current law, if an employer can present objective evidence that
a union has lost majority support during a period when the
union's decertification is not barred, then the employer can
unilaterally withdraw recognition of the union without an
election. However, if a union campaigning for representation
presents objective evidence that it has majority support, the
employer can require an election before being required to
recognize the union. This amendment rectifies that double-
standard, by requiring an election before an employer can
unilaterally withdraw recognition.
This amendment was ruled non-germane. The appeal of the
ruling was tabled on a vote of 22-16.
Amendment 4--To strike language allowing open-ended litigation in pre-
election hearings
In order to ensure that pre-election hearings are focused
on resolving genuine disputes, Ranking Member Bobby Scott
proposed an amendment striking the text that authorizes parties
to raise ``any other issue which . . . may reasonably be
expected to impact the outcome of the election.'' Pre-election
hearings are for setting election ground rules such as defining
the appropriate bargaining unit, or resolving issues that
eliminate the need for an election. They are not for concocting
litigation over ``any other issue'' that could impact the
election's outcome, which could range from disputes over the
accuracy of campaign literature to alleged unfair labor
practices by either party.
The amendment was rejected 16-22.
Amendment 5--To sanction frivolous and vexatious filings
In order to deter frivolous filings, Representative Suzanne
Bonamici proposed an amendment to provide the NLRB with the
authority to impose sanctions on any party for presenting a
frivolous or vexatious filing during any stage of a
representation proceeding. Potential sanctions included
reimbursement of the opposing party's attorney fees and costs,
using criteria in Rule 11 of Federal Rules of Civil Procedure.
In addition, if the Board determines that a party presented a
frivolous filing for purposes of delaying an election, the
Board shall direct an election in not less than 7 days after
such determination. The NLRB has no sanction procedures with
regards to representation proceedings.
The amendment was rejected 16-22.
Amendment 6--To prevent employers from gerrymandering the bargaining
unit
Representative Mark DeSaulnier proposed an amendment to
strike text that would allow employers to gerrymander
bargaining units as a way to impact the outcome of union
elections. The amendment reinstated the traditional requirement
that an employer can only succeed in adding employees to the
proposed bargaining unit if the additional employees shared an
``overwhelming community of interest'' with the other
employees. This bill hinders employees' right to join a union
by empowering employers to cram the pool of eligible voters
with employees who have expressed no interest in joining a
union. In addressing this problem, the amendment restores the
current law as expressed in the NLRB's Specialty Healthcare
decision.
This amendment was rejected 16-22.
Amendment 7--To prohibit captive audience meetings after an election is
ordered
To prevent coercion and intimidation by employers during
the election process, Representatives Donald Norcross and Jared
Polis proposed an amendment to prohibit captive audience
meetings between the date an election is ordered and the time
of election. Should an employer violate this provision, the
election can be invalidated and a new election ordered upon the
filing of valid objections. The amendment provided an exception
where there is an explicit written agreement between the
employer and a union.
Captive audience meetings are compulsory listening sessions
that are conducted by employers on an employee's paid time and
are used to propagandize against the union seeking recognition.
Current law only prohibits captive audience meetings in the 24
hours prior to an election. Under current law, employees who
refuse to participate or object to any portion of the
presentation can be legally fired by their employer. Unions are
not provided equal time at these meetings, nor do they have any
right to enter the employer's worksite to provide information.
This amendment helps to level the playing field, and it will
help ensure that employees can exercise their choice untainted
by attendance at forced meetings. The amendment does not
restrict the employer's ability to hold voluntary and unpaid
meetings with employees, which are the same terms on which
unions campaign.
This amendment was rejected 16-22.
Amendment 8--To substitute the text of the bill with the Raise the Wage
Act
Representative Mark Takano offered an amendment to replace
the bill with the Raise the Wage Act (H.R. 15). This amendment
raises the federal minimum wage to $15 an hour by 2024. H.R.
2776 does nothing to grow the economy or expand the middle
class. By impeding the ability of workers to organize, it
depresses wages and creates a more insecure labor market.
During this time of skyrocketing inequality, this Committee
should be focused on empowering workers and raising wages.
The amendment was ruled non-germane, and the appeal of the
ruling was tabled.
Robert C. ``Bobby'' Scott.
Ranking Member.
Susan A. Davis.
Raul M. Grijalva.
Joe Courtney.
Marcia L. Fudge.
Jared Polis.
Gregorio Kilili Camacho Sablan.
Frederica S. Wilson.
Suzanne Bonamici.
Mark Takano.
Alma S. Adams.
Mark DeSaulnier.
Donald Norcross.
Lisa Blunt Rochester.
Raja Krishnamoorthi.
Carol Shea-Porter.
Adriano Espaillat.
[all]