Labor Relations & Wages Hours Update
April 2013
Hot Topics in LABOR LAW:
NLRB petitions Supreme Court for review of D.C. Circuit’s Noel Canning decision
By Lisa Milam-Perez, J.D.
As anticipated, the Obama administration today asked the U.S. Supreme Court to review
the D.C. Circuit’s ruling in Noel Canning v NLRB, a January 2013 decision that
invalidated the President’s recess appointments to the NLRB. As the questions presented
in the government’s cert petition attest, the issues at stake before the High Court are
much bigger than the scope of the Board’s authority or the ongoing efforts to rein in
agency activism, which was at the heart of the underlying dispute.
In an attempt to staff the agency in the face of a Senate logjam, President Obama in
January 2012 made a controversial appointment of three NLRB members while the
Senate was not technically in recess but was meeting on a pro forma basis. In what was
seen by some labor law practitioners as “a stunning development,” the D.C. Circuit, in a
highly anticipated decision, held those appointments were unconstitutional and, as such,
the Board was operating without a proper quorum last year. In so ruling, the appeals court
sharply curtailed the current Board’s functions and called into question the validity of
every decision issued by the NLRB in the past year — including controversial rulings
reversing long-standing precedent and riling the employer community.
Addressing the constitutional question before it, the D.C. Circuit issued two holdings:
first, that there is no recess between sessions — an intra-session recess does not count;
and second, that a vacancy itself must arise during an inter-session recess for a valid
recess appointment to be made. The first holding is contrary to an Eleventh Circuit
opinion; the second ruling is in conflict with three other circuits.
The questions presented ask the Court to consider the scope of presidential powers under
the Constitution’s recess appointments clause: “(1) whether the president’s recessappointment power may be exercised during a recess that occurs within a session of the
Senate, or is instead limited to recesses that occur between enumerated sessions of the
Senate; and (2) whether the president’s recess-appointment power may be exercised to
fill vacancies that exist during a recess, or is instead limited to vacancies that first arose
during that recess.” The NLRB’s petition argues that the President’s recess appointment
authority is not confined to inter-session recesses; moreover, it asserts, the President may
fill a vacancy that exists during a Senate recess even if the vacancy did not arise during
that recess.
The NLRB also contends that the D.C. Circuit’s decision would have “serious and farreaching consequences,” rendering unconstitutional many presidential recess
appointments made since World War II. “The decision also threatens a significant
disruption of the federal government’s operations — including, most immediately, those
of the National Labor Relations Board.” Not only does the ruling challenge every Board
ruling since January 2012, the NLRB argues, “it could also place earlier orders in
jeopardy.” Many Board members have been recess-appointed over the past decade, the
petition notes, and the NLRA imposes no time limit on petitions for review of Board
rulings.
High Court to consider whether federal district court has jurisdiction over
allegations of anti-union brutality abroad by non-U.S. employer
The U.S. Supreme Court will decide whether a federal district court has jurisdiction over
a foreign company in a suit alleging German auto company DaimlerChrysler was
involved in human rights violations—namely, kidnapping, torture, and murder of workers
deemed “subversives”—at an Argentina Mercedes Benz plant in the late 1970s. The High
Court granted cert in the case, DaimlerChrysler Corp v Bauman (Dkt No 11-965), on
Monday, April 22, to consider whether the fact that a company subsidiary (MercedesBenz USA) had substantial contacts in the state of California was enough to establish
personal jurisdiction.
The question presented: “whether it violates due process rights for a court to exercise
general personal jurisdiction over a foreign corporation based solely on the fact that an
indirect corporate subsidiary performs services on behalf of the defendant in the forum
State.”
Dawson, Flynn appointed as NLRB ALJs
The NLRB announced April 8 the appointments of Donna Dawson and Susan Flynn as
administrative law judges in its Division of Judges, replacing two judges who retired late
last year. They are transferring to the Board from similar positions with the Social
Security Administration.
Judge Dawson was a judge with the Social Security Administration for the last two and a
half years. Before joining Social Security, she spent 17 years with the EEOC in various
capacities, including as an administrative judge and a chief administrative judge. She also
spent time in private practice and as an attorney with federal and state agencies. Judge
Dawson received her undergraduate degree from Howard University in Washington, DC,
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and her law degree from the Houston University Law Center. She will take her
assignments from the Atlanta office of the Division of Judges.
Judge Flynn served as a Social Security judge for three and a half years, including a stint
as the hearing office chief judge in Philadelphia. Before joining Social Security, she spent
22 years as an administrative judge with the EEOC, including 15 years as the chief
administrative judge in Philadelphia. Earlier in her career, she also did trial work in
private practice and with local government agencies. Judge Flynn received her
undergraduate degree from the University of Delaware and her law degree from
Villanova University. She will take her assignments from the Washington, DC office of
the Division of Judges.
With offices in Washington, DC, New York City, San Francisco and Atlanta, the
Division of Judges is responsible for docketing unfair labor practice cases brought by the
Board’s General Counsel on charges filed by unions, employers, and individual
employees. The Division disposes of those cases by settlement or by conducting trials
and issuing initial decisions, which may then be appealed to the five-member Board and
thereafter to an appropriate United States Court of Appeals.
Obama announces intent to nominate three members to Board, industry reacts
On April 9, the White House announced President Obama’s intent to nominate three
members to the NLRB. The president plans to renominate Mark Gaston Pearce (D) and
has slated lawyers Harry L. Johnson III (R) and Philip A. Miscimarra (R ) for nomination
to the Board.
“I am pleased to nominate these individuals to serve on the National Labor Relations
Board. By enforcing workplace protections, upholding the rights of workers and
providing a stable workplace environment for businesses, the NLRB plays a vital role in
our efforts to grow the economy and strengthen the middle class. With these nominations
there will be five nominees to the NLRB, both Republicans and Democrats, awaiting
Senate confirmation. I urge the Senate to confirm them swiftly so that this bipartisan
board can continue its important work on behalf of the American people,” President
Obama said in a statement today.
Nominations for the five-member Board have previously been submitted by the White
House and are now pending for Richard F. Griffin, Jr. and Sharon Block, who are
currently serving as Board Members under recess appointments.
Five-person package. The controversy surrounding those recess appointments, however,
may doom the five-person package, according to Hal Coxson, a shareholder at Ogletree,
Deakins, Nash, Smoak, & Stewart, PC and the Chair of the firm’s Government Relations
Practice Group. Coxson said that Miscimarra is one of the finest lawyers he knows, a
scholar, and has the makings of a very good Board Member and he also praised Johnson.
Nonetheless, he doubted whether a five-person package that included the two recess
appointees would get past the Senate with Noel Canning likely to lurk before the
Supreme Court.
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“I think it is unlikely that a five-member package will be confirmed, especially if it
includes the 2 recess appointees,” Coxson said. However, he suggested a possible
alternative — confirmation of a four-member Board composed of two Republicans and
two Democrats. Under that scenario, the Board could continue to function with ordinary
business.
Republican committee chairmen react. Others reacted to the White House
announcement, as well. House Committee on Education and the Workforce Chairman
John Kline (R-MN) and Subcommittee on Health, Employment, Labor, and Pensions
Chairman Phil Roe (R-TN) said in a statement: “While we welcome the president's longoverdue effort to resolve the crisis he created, today’s announcement does not abate the
chaos surrounding the National Labor Relations Board. Workers, employers, and unions
are stuck in a state of legal limbo as roughly 600 decisions issued by this board remain
constitutionally suspect. The House will act this week to prevent the board from
exacerbating the current legal uncertainty.”
According to the two Republican committee chairmen, “The American people deserve a
board that will fairly and objectively administer the law. In recent years the board has
instead advanced extreme policies harmful to the rights of workers and job creators. We
intend to closely follow the confirmation process and expect the nominees to demonstrate
a commitment to abandon an activist agenda”
Union president lends support. AFL-CIO President Richard Trumka stated in a release
that “President Obama, with the nominations announced today, has taken an important
step toward restoring stability to our system of labor-management relations, which has
been in disarray since the DC Circuit’s decision in the Noel Canning case. For America’s
workers, businesses and the promotion of healthy commerce, putting forward a full, bipartisan package of nominees to the NLRB is the right thing to do.
Trumka pointed out that the package includes individuals who have challenged recent
NLRB actions and whose views on labor relations matters are sometimes contrary to
those of the union. “But working people need and deserve a functioning NLRB, and
confirmation of a full package will provide that stability,” he said. “The labor movement
understands that when the NLRB is not at full strength and cannot enforce its orders,
America’s economy falls out of balance, as it is today with record inequality and a
shrinking middle class. We urge members of the Senate to act quickly and confirm the
President’s full slate of nominees.”
Pearce has been Chairman of the NLRB since August 2011 and has been a Member since
March 2010. Johnson is currently a partner with Arent Fox LLP and Miscimarra is
partner in the Labor and Employment Group of Morgan Lewis & Bockius LLP.
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Senators speak out on NLRB nominations
By Sheryl Allenson, J.D.
Two Senators from the Senate Committee on Health, Education, Labor & Pensions
responded to President Obama’s announcement that he intends to nominate Harry I.
Johnson, III and Philip A. Miscimarra, and renominate Mark Gaston Pearce, to the
NLRB. In a statement yesterday, Senator Tom Harkin (D-IA), Chairman of the HELP
committee, stated: “I am pleased that President Obama has put forth a bipartisan slate of
nominees to fill positions on the National Labor Relations Board. It is of paramount
importance — for workers, for businesses, and the economy — to have a fullyfunctioning NLRB to adjudicate disputes in a timely fashion. As Chairman of the HELP
Committee, I pledge to give fair and timely consideration to the president’s package of
five nominees, and I hope that my colleagues on the other side of the aisle will do the
same.”
However, Senator Lamar Alexander (R-Tenn), the committee’s ranking member,
expressed other concerns. “As tradition requires, the president has properly nominated
two Republicans to serve on the National Labor Relations Board. It is now the Senate’s
role to exercise advice and consent on the nominees. As the Senate considers the
nominees, the two individuals who were unconstitutionally appointed should leave,
because the decisions in which they continue to participate are invalid.”
On February 13, Alexander called on Sharon Block and Richard Griffin to “leave the
board,” after the DC Circuit in January issued the Noel Canning ruling. Alexander
introduced a budget amendment last month, along with 17 cosponsors, to defund
decisions and regulations made by the unconstitutional NLRB “quorum.”
House Rules Committee passes resolution on Preventing Greater Uncertainty in
Labor-Management Relations Act
The House Rules Committee on April 10 passed a resolution, by a 7-3 vote, providing for
consideration of HR 1120, the Preventing Greater Uncertainty in Labor-Management
Relations Act, under a closed rule. The resolution provides one hour of debate equally
divided and controlled by the chair and ranking minority member of the Committee on
Education and the Workforce (Workforce Committee). Additionally, it prohibits
amendment of the bill.
Among other things, the Preventing Greater Uncertainty in Labor-Management Relations
Act would require the Board to cease all activity requiring a three-member quorum. The
bill also prohibits the Board from enforcing any action taken after January 2012 that
requires a quorum. According to information from the Workforce Committee, the bill
does not prevent the NLRB’s regional offices from accepting and processing unfair labor
practice charges filed by an injured party, be it a worker, employer, or a union. The bill
would remove restrictions on the Board’s authority after one of the following events
occurs: (1) the Supreme Court rules on the constitutionality of recess appointments; (2) a
Board quorum is constitutionally confirmed by the Senate; or (3) the terms of the
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“unconstitutional recess appointees” expire when the First Session of the 113 Congress
adjourns.
According to information from the Workforce Committee, the bill “ensures any action
involving the so-called recess appointees is reviewed and approved by a future board that
has been constitutionally appointed.” The Workforce Committee approved the legislation
on March 20.
House approves Preventing Greater Uncertainty in Labor-Management Relations
Act
Just days after the House Rules Committee passed a resolution relating to the proposed
legislation, the House of Representatives approved the Preventing Greater Uncertainty in
Labor-Management Relations Act (HR 1120). Among other things, the legislation
requires the NLRB to cease all activity requiring a three-member quorum until the legal
uncertainty surrounding the Board is appropriately resolved.
As approved by the House, HR 1120 will:
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Require the Board to cease all activity that requires a three-member quorum. The
bill also prohibits the Board from enforcing any action taken after January 2012
or appointing any agency personnel that require a quorum.
Protect the right of workers to petition for union elections. The bill also does not
prevent the NLRB regional offices from accepting and processing unfair labor
practice charges filed by an injured party.
Remove restrictions on the Board’s authority after one of the following events
occurs: (1) the U.S. Supreme Court rules on the constitutionality of the recess
appointments; or (2) a Board quorum is constitutionally confirmed by the Senate;
or (3) the terms of the “unconstitutional recess appointees” expire when the First
Session of the 113th Congress adjourns.
Ensure any action involving the “so-called recess appointees” is reviewed and
approved by a future Board that has been constitutionally appointed.
Senate Republicans introduce companion bill barring NLRB from issuing decisions
with “quorum of one”
Lamar Alexander (R-Tenn), Ranking Member of the Senate HELP Committee,
introduced a measure on Friday, April 26, that would prohibit the NLRB as currently
comprised from taking any action that would require a quorum. The legislation, the
Preventing Greater Uncertainty in Labor-Management Relations Act, is an identical
companion bill to H.R. 1120, which passed the House on April 12. The Senate version
has 11 Republican cosponsors.
The legislation would prohibit the NLRB from taking any action that requires a threemember quorum until the Board members constituting the quorum have been confirmed
by the Senate, the Supreme Court issues a decision on the constitutionality of the
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appointments to the Board made in January 2012, or the first session of the 113th
Congress is adjourned. The bill also prohibits the Board from enforcing any action taken
after January 2012 or appointing any agency personnel that requires a quorum to do so. It
also would ensure any action involving the recess appointees is reviewed and approved
by a future Board that has been constitutionally appointed. (The legislation would not
prevent the NLRB regional offices from accepting and processing unfair labor practice
charges filed by an injured party, however.)
In January, the D.C. Circuit ruled in NLRB v Noel Canning that the recess appointments
of two members to the NLRB were unconstitutional, meaning only one of the current
sitting Board members has been confirmed by the Senate. Last week, the Obama
administration formally petitioned the Supreme Court to review Noel Canning; the High
Court is expected to grant certiorari in light of the constitutional issues at stake, but it’s
unlikely that it will hear the matter during the current term.
In the meantime, the Republican-backed measures would end “the stream of decisions
and regulations” issued by an invalid “quorum of one,” according to Alexander. Since
Noel Canning, the Board has issued 44 published decisions and 113 unpublished
decisions and orders. “Allowing these individuals to issue invalid decisions and
regulations will only threaten the rights of American workers, the very people the [B]oard
is intended to protect,” Alexander contends.
“The NLRB has traditionally made major policy changes and interpretations only with
the affirmative votes of at least three board members, typically from a full five-member
[B]oard,” he added. “Yet, even with unconstitutionally recess-appointed board members,
the Board continues to issue decisions overruling well-established precedent and
replacing it with new policy that is favored by the administration’s supporters.”
In March, Alexander had introduced a budget amendment to defund decisions and
regulations issued by the “unconstitutional” quorum. Previously, in February, he called
on Sharon Block and Richard Griffin, the members whose recess appointments were
invalidated by the appeals court, to leave the Board.
Shinners appointed Executive Secretary
NLRB Chairman Mark Gaston Pearce announced on April 12 the appointment of Gary
Shinners as Executive Secretary of the NLRB. In 2010, Shinners was appointed Deputy
Executive Secretary. He has served as the Agency’s Acting Executive Secretary since
January of this year, when former Executive Secretary Les Heltzer retired. His
appointment begins immediately.
Shinners began his NLRB career in 1983 as an attorney on the staff of former Board
Member Howard Jenkins, and between 1984 and 1987 he worked as counsel on the staffs
of former Chairman Donald Dotson and former Chairman James Stephens. In 1987,
Shinners transferred to the Division of Enforcement Litigation, Contempt Litigation &
Compliance Branch. He was promoted to Deputy Assistant General Counsel in the
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Contempt Branch in 1989, and was later promoted to Assistant General Counsel (Branch
Chief) in the Contempt Branch in 1996.
From 2001 to 2003, Shinners served as Chief Counsel to former Member Dennis Walsh;
from 2003 to 2004, he served as Chief Counsel to former Member William Cowen; and
from 2004 to 2006, he again served as Chief Counsel to former Member Dennis Walsh.
Shinners served as Deputy Chief Counsel to former Chairman Wilma Liebman from
2006 to 2010.
Perez testifies before Senate HELP committee
Thomas E. Perez, nominee for Secretary of Labor, testified in a confirmation hearing
before the U.S. Senate Committee on Health, Education, Labor & Pensions. Maryland
Senators Barbara Mikulski and Senator Ben Cardin introduced Perez in the hearing,
which lasted about two and a half hours. Chairman Senator Tom Harkin (D-IA) also
delivered an introduction, in which he lauded Perez and his accomplishments. Among
other things, Harkin stated, “Now more than ever, we need a dynamic leader at the helm
of the Department of Labor who will embrace a bold vision of shared prosperity, and help
make that vision a reality for American families. I am confident that Tom Perez is up to
this challenge.”
In his own statement, Perez provided an introduction to his personal and professional
background. He discussed his vision of the DOL, stating: “I share President Obama’s
vision of a growing economy powered by a rising middle class, with ladders of
opportunity available to everyone. The President has asked us all to consider three
questions in all of the decisions we make: How do we make America a magnet for jobs?
How do we equip our people with the skills they need to succeed in those jobs? And how
do we ensure that an honest day’s work leads to a decent living? These questions are at
the core of the mission of the Department of Labor. If confirmed, I will keep them there.”
DOL awards contract without project labor agreement; anti-PLA trade group
claims victory
The U.S. Department of Labor has awarded Eckman Construction Company a $31.6
million contract to build a DOL Job Corps Center in Manchester, New Hampshire, after
removing a government-mandated project labor agreement (PLA) from the federal
project’s solicitation for construction services. Eckman submitted a bid that was more
than $6 million below the lowest offer when the project was subjected to a PLA,
according to Associated Builders and Contractors (ABC), a construction trade group,
which issued a statement celebrating its “victory.”
“The award of this contract to a local contractor demonstrates the benefits of fair and
open competition in federal contracting and undermines specious claims made by PLA
advocates,” said Ben Brubeck, ABC’s director of labor and federal procurement. “The
apples-to-apples comparison of the Job Corps Center bidding with and without a PLA
mandate proves these special interest schemes reduce competition, increase costs and
harm local contractors.”
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According to ABC, the solicitation for construction services to build the Job Corps
Center project was first issued in 2009, but the project was delayed for nearly three years
as a result of bid protests filed with the Government Accountability Office (GAO) against
repeated efforts by DOL to mandate a PLA. The first attempted PLA mandate for the
project was issued in September 2009 as a result of President Obama’s Executive Order
13502, which encourages federal agencies “to consider requiring the use of project labor
agreements in connection with large-scale construction projects in order to promote
economy and efficiency in federal procurement.” In response, a federal contractor (with
the help of ABC) filed a bid protest with the GAO, prompting the DOL to cancel the Job
Corps Center solicitation in November 2009.
“Rather than remove the controversial PLA mandate and proceed with the procurement
process using fair and open competition, the DOL waited more than two years to issue a
new solicitation, and it still contained a PLA mandate,” said Brubeck. “Public record
requests revealed that the DOL spent $428,000 in taxpayer funds to hire a consultant, Hill
International, to complete two studies to evaluate the use of PLAs on federal contracts
and erroneously justify the DOL’s use of a PLA on the Job Corps Center.”
In March 2012, federal contractors filed another GAO protest against the DOL’s second
PLA mandate, again with the assistance of ABC, according to the trade group. That
summer, the GAO advised the DOL to take corrective action and rebid the project
without a PLA. The DOL canceled the solicitation — but after it had already received
and publicly unsealed bids that were subject to the PLA mandate. Finally, in October
2012, the DOL issued a solicitation free from a PLA mandate. Those bids were opened in
February.
“When the PLA mandate was removed, the number of qualified contractors bidding on
the project increased threefold,” said Brubeck. “Even contractors that submitted
proposals during both rounds of bidding lowered their price by an average of 10 percent
when bidding on the solicitation without a PLA mandate.”
“It is time for the Obama administration to stop trying to steer lucrative federal
construction contracts to well-connected unionized firms and union members — some of
the president’s largest political supporters — through unlawful government-mandated
PLAs,” Brubeck said.
GOP senators challenge use of taxpayer dollars to fund foreign labor unions
Top Republicans on the Senate Finance and HELP Committees raised a challenge today
to the use of American taxpayer dollars for promoting collective bargaining rights in
foreign countries.
Finance Ranking Member Orrin Hatch (R-Utah) and HELP Ranking Member Lamar
Alexander (R-Tenn.) wrote two separate letters to GAO Comptroller General Gene
Dodaro and the DOL Acting Secretary Seth Harris calling for a full examination of the
financial transactions being made by the Bureau of International Labor Affairs (ILAB),
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an office within the DOL, to various groups to assist with the establishment of
international labor organizations.
Over the past several fiscal years, the Senators note, ILAB has made numerous awards
totaling millions of dollars to labor organizations, the United Nations, the Solidarity
Center, and other similar organizations, whose stated objective is to help establish labor
unions in foreign countries. In 2011, ILAB awarded a grant for $1.5 million to an
international development company for assisting labor unions in Vietnam engage in
collective bargaining. Most recently, ILAB awarded a Columbian labor organization $1.5
million to help Columbian workers improve their collective bargaining rights, and
awarded $2.2 million to the Solidarity Center, an AFL-CIO organization, to strengthen
unions in Haiti and Peru.
“At a time when our Federal budget is deteriorating rapidly, sequestration is impacting
essential services and the reality of vastly reduced Federal budgets with corresponding
cuts in public service delivery here at home, it is troubling to us that the Department
appears to be spending millions of dollars of taxpayer funds to establish labor unions and
promote collective bargaining in foreign countries,” the senators wrote.
Blanket rule requiring confidentiality in employee investigations violates Sec.
8(a)(1); need for confidentiality must be shown on a case-by-case basis, Division of
Advice says
An employer’s confidentiality rule unlawfully interferes with employees’ Section 7 rights
by precluding employees from disclosing information about ongoing investigations into
employee misconduct, the NLRB’s associate general counsel determined in a January 29,
2013, advice memo released last week.
At issue was a policy implemented by Verso Paper in the employer’s code of conduct:
“Verso has a compelling interest in protecting the integrity of its investigations,” the
policy stated. “In every investigation, Verso has a strong desire to protect witnesses from
harassment, intimidation and retaliation, to keep evidence from being destroyed, to
ensure that testimony is not fabricated, and to prevent a cover-up.”
This overbroad work rule violates Sec. 8(a)(1) under the Board’s decision in Banner
Health, the memo concludes. In that case, a divided NLRB held that a blanket prohibition
on discussing human resources complaints during the pendency of an investigation
violated the NLRA because it failed to minimize the impact on employees’ Sec. 7 rights.
An employer “cannot maintain a blanket rule regarding the confidentiality of employee
investigations,” the memo stated. Rather, it must show the need for confidentiality “on a
case-by-case basis.” The employer has the burden “to demonstrate a particularized need
for confidentiality in any given situation.”
The Division of Advice directed the region to issue an unfair labor practice complaint
against the employer, absent settlement.
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Leafleting in work area. In another issuance from the Division of Advice, the Board’s
associate general counsel advised that Hyatt Hotels Corp. did not violate the NLRA by
prohibiting off-duty employees from distributing union leaflets in the hotel’s lobby court
and patio. These areas are work areas, the memo stated, and the employer thus could
lawfully restrict distribution there under Republic Aviation and its progeny. Nor did the
hotel improperly orally modify its solicitation and distribution policy when the hotel’s
director of security told the off-duty employees they could not distribute union literature
inside the hotel, but they could do so outside the facility. Concluding that the charges
against Hyatt were without merit, the Division of Advice directed that they be dismissed,
absent withdrawal.
GC office advises regions on when to modify previously issued remedial orders
pursuant to Latino Express
In GC Memorandum 13 03, issued February 15, 2013, the acting general counsel outlined
the procedures that regional offices are to use when calculating excess income taxes
pursuant to the Board’s December 2012 Latino Express, Inc ruling. It also directed the
regions, in all pending cases, to immediately begin requiring charged party/respondents
to file reports with the Social Security Administration when the backpay period spans
two or more years. In Operations Memo 13-41, issued on Monday, April 29, the associate
general counsel offered guidance to the regions as to when they should seek modification
of previously issued Board orders to incorporate Latino Express remedies. A sample
Motion to Modify Remedial Order accompanies the memorandum.
Regions should review all pending compliance cases in which a Board order issued prior
to December 18, 2012, that involved the payment of backpay where discriminatees could
be affected by the excess tax liability reimbursement, OM 13-41 advises. When deciding
whether to file a motion to modify the remedial provisions in these cases, the region
should consider whether the respondent has complied with the Board’s order or is
engaged in serious discussions with the region regarding compliance efforts.
If the case is pending before an appellate court, the region should discuss with Deputy
Associate General Counsel Linda Dreeben or Assistant General Counsel David
Habenstreit whether it is prudent to withdraw the case before the court in order to file a
motion to modify, the memo instructs.
In Latino Express, the NLRB adopted the acting general counsel’s proposed remedies
requiring employers to reimburse the excess income taxes paid out by an employee as a
result of having received a lump-sum backpay award and the reporting of that backpay
allocation to the SSA. The Board reasoned that such a remedy would better serve the
remedial goals of the NLRA by ensuring that employees are truly made whole for
discrimination they suffered as a result of an employer’s violation of the Act.
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LEADING CASE NEWS:
2ndCir: District court erroneously held that NFL CBA clause on workers’ comp
offsets for players preempted contrary state law
By David Stephanides, J.D.
In a summary order, the Second Circuit has ruled that a district court, in confirming an
arbitrator’s award, erroneously ruled that a clause in the NFL players’ contract on
workers’ comp offsets preempted state law to the contrary (NFL Players Association v
NFL Management Council, April 19, 2013, per curium). In his award, the arbitrator
expressly declined to resolve a state preemption question, and the district court’s ruling,
while not unrelated to the underlying arbitration, was not “necessary to vindicate [the
district court’s] authority, and effectuate its decree[ ].”
Like other injured workers, injured NFL players are entitled to seek benefits from state
workers’ compensation funds. The clause in question, “Paragraph 10” of the CBA,
addressed a club’s rights when one of its players is entitled to receive both state workers’
comp and salary. Under such circumstances, Paragraph 10 authorizes a club to deduct the
player’s workers’ comp award from the amount it owes him in salary. The National
Football League Management Council (“Management”) and the players agreed that this
rule — which they referred to as the “offset” — is designed to preclude players from
“double-dipping” by concurrently receiving workers’ compensation payments and salary.
Time versus “dollar-for-dollar” offsets. In 2005, however, the players brought an
arbitration proceeding seeking a declaration that Paragraph 10 mandates a time offset
versus a “dollar-for-dollar” offset. After extensive proceedings, the arbitrator issued an
award in favor of the players, stating that “Paragraph 10 of the NFL Player Contract
provides only for a time offset, and not for a dollar-for-dollar offset… [T]his is the law of
the shop under this CBA and is binding…” After the district court confirmed the award,
several clubs continued to seek dollar-for-dollar offsets in various state workers’ comp
tribunals and courts. Spurred by these actions, the players returned to the district court
requesting injunctive relief. Later, the players moved the district court to hold
management in contempt when the “dollar-for-dollar” offsets persisted. The district court
denied the contempt motion, but declared that “[i]n addition to providing for a time
offset, Paragraph 10 of the Player’s Contract preempts any state law to the contrary.”
Improper expansion of award. In vacating the district court’s order, the court noted that
Section 301 of the LMRA does not articulate the substantive or procedural rules of the
enforcement regime that it contemplates, but courts have in the past turned to the Federal
Arbitration Act (FAA), for guidance about arbitration enforcement conducted under
section 301. Because the FAA requires district courts to accord significant deference to
arbitrators’ decisions, the “showing required to avoid summary confirmation of an
arbitration award is high,” the court noted. Here, when the district court held that
Paragraph 10 preempted contrary state law, “it in effect expanded the terms of the
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arbitration award.” This was not necessary to vindicate the court’s authority, and
effectuate its order, the appeals court concluded. Accordingly, the order was vacated.
The case number is 12-0402-cv.
Attorneys: Jeffrey L. Kessler (Winston & Strawn) for Employees. Rex S. Heinke (Akin
Gump Strauss Hauer & Field) for Employers.
3rdCir: Past practice meant that maintenance clerk entitled to work weekends when
maintenance department worked; arbitration award reinstated
By Ronald Miller, J.D.
A federal district court erred in vacating an arbitration award that the parties’ past
practice meant a maintenance clerk was entitled to work Saturday overtime when the
maintenance department was scheduled to work, ruled the Third Circuit (Akers National
Roll Co v Steelworkers, April 4, 2013, Aldisert, R). In view of the collective bargaining
agreement’s ambiguous language and in light of the Third Circuit’s ruling in Ludwig
Honold Mfg Co v Fletcher, the appeals court concluded that the arbitrator’s interpretation
drew its essence from the CBA and the arbitrator did not manifestly disregard the
agreement. The district court should not have disturbed the award.
The union brought three grievances on behalf of an employee alleging that the employer
violated a “past practice” by failing to schedule the employee, a maintenance clerk, for
Saturday overtime when the maintenance department was scheduled to work. The
arbitrator sustained the grievances and ordered the employer to pay the employee back
wages for the missed overtime. After the employer sued to vacate the arbitrator’s award,
the district court concluded that the award did not draw its essence from the CBA, finding
that the agreement “unambiguously” gave the company the exclusive right to schedule its
workforce. The appeals court disagreed with the lower court’s reasoning, reversed its
judgment, and ordered enforcement of the arbitrator’s award.
Past practice. According to the grievances, the company directed the employee not to
work on Saturday shifts on three occasions when employees in the maintenance
department were scheduled to work. The union asserted that under past practice the
maintenance clerk had always worked when the maintenance department worked.
Because the employee would have been eligible for overtime if he had worked those
Saturday shifts, the union contended that the employer should be liable to pay him at the
overtime rate for the hours he was wrongly not scheduled to work. When the parties were
unable to resolve the matter, it proceeded to arbitration.
Siding with the union, the arbitrator awarded the employee back wages and earned profitsharing for the time he would have worked on those weekends that the maintenance
department was scheduled to work. He found a binding past practice was established
when the employee was permitted to work on previous weekends when his name did not
13
appear on the work schedule; this had occurred under two different maintenance
managers. Thereafter, the company filed suit to vacate the arbitrator’s award, alleging the
arbitrator ignored the company’s exclusive right under the CBA to direct the workforce
and schedule overtime. The district court granted the employer’s summary judgment
motion and vacated the award. The union appealed.
Risks of arbitration. The overarching question on appeal was whether the arbitrator’s
award drew its essence from the CBA. When parties knowingly and voluntarily bargain
for arbitration to resolve disputes, the appeals court observed, they receive the benefits of
fast results and reduced dispute-resolution expenses. However, those benefits do not
come without risk, and “the possibility of receiving inconsistent or incorrect rulings
without meaningful appellate review of the merits is one of the risks such parties must
accept when they choose arbitration over litigation.” As observed in Ludwig, federal
labor law elevates labor arbitrators to “an exalted status.” Thus, a court cannot overrule
an arbitrator simply because it disagrees with his or her construction of the contract, or
because it believes its interpretation of the contract is better than the arbitrator’s. Here,
the employer accepted the risk of arbitration but now sought to avoid its result. The
appeals court refused to permit it to do so.
Ambiguity of agreement. The employer contended that the provisions of the CBA
unambiguously vested it with the exclusive right to schedule its employees. This raised a
critical threshold question, observed the court: was the CBA so unambiguous as to the
employer’s right to schedule its workforce that the arbitrator’s award manifestly
disregarded it? Here, the arbitrator focused his analysis on whether the agreement’s
zipper clause precluded a finding of past practice. As the district court corrected noted,
the arbitrator never explicitly stated that the management rights clause and “hours of
work” provision were ambiguous.
However, nowhere in the management rights clause did the right to schedule appear.
Further, the court noted that the employer did not rely on the “hours of work” provisions
in challenging the grievances. Thus, the court concluded that the CBA was not so free of
ambiguity regarding the company’s exclusive right to schedule its workforce that the
arbitrator’s inquiry into past practice and introduction of extrinsic evidence were not
permissible.
Essence from agreement. On further examination, the appeals court also determined that
the arbitrator’s award drew its essence from the CBA. Again, the court deferred to the
arbitrator’s ultimate conclusion that a past practice both could be and had been
established. Here, the arbitrator considered the contentions of the parties, the evidence
presented, and the history of the dispute between the union and the employer. He then
determined that he was required to decide whether the parties established a past practice
by their actions in 2008, and whether that past practice was violated. Moreover, both the
employer and union focused on whether a past practice could exist under the CBA,
specifically whether its zipper clause precluded introduction of past practice into the
agreement.
14
The appeals court deferred to the arbitrator‘s determination that the issue was whether a
past practice had been established and violated. Throughout his discussion, the arbitrator
emphasized that the past practice began before the adoption of the CBA and continued
thereafter. Accordingly, the appeals court also deferred to the arbitrator‘s conclusion that
a binding past practice had been established. Consequently, the judgment of the district
court was reversed.
The case number is 12-1727.
Attorneys: John B. Bechtol (Metz Lewis) for Employer. Daniel M. Kovalik, United
Steelworkers, for Union.
3rdCir: Substantial evidence supported NLRB rulings that employer and newly
acquired facility were single employer
By Ronald Miller, J.D.
Substantial record evidence supported rulings of the NLRB that an employer and a newly
acquired facility constituted a single employer, the employer had a duty to bargain with a
union representing employees at the facility, and the employer acted unlawfully by
refusing to hire five former employees of the facility who were officers of the union,
ruled the Third Circuit (Grane Health Care v NLRB, April 5, 2013, Ambro, T). The court
denied the employer’s petition to review the Board’s order.
Background. Prior to January 2010, Cambria County owned Laurel Crest nursing home.
As a public employer, the county was subject to Pennsylvania’s Public Employee
Relations Act (PERA). In September 2009, Grane Healthcare, a private entity, entered
into a purchase agreement with the county to purchase the facility. The unions
representing the nursing home’s employees opposed the takeover. On January 1, 2010,
Grane assumed operations of the facility and established a new entity, Cambria Care
Center, to operate it. Grane conducted initial hiring and retained most of the current
employees who applied. Among the employees not hired by Grane were several union
officers, including the local president and business manager.
In anticipation of the sale, the union requested that Grane recognize it as the exclusive
collective bargaining representative of Laurel Crest employees. The employer refused the
union request. Thereafter, the union filed an unfair labor practice charge with the NLRB.
In May 2010, following an investigation, the NLRB General Counsel issued a complaint
alleging that Grane unlawfully refused to recognize and bargain with the union as the
representative of bargaining unit employees, and that it unlawfully refused to hire union
officers who applied for employment. The Board issued an order requiring the company
recognize and bargain with the union and hire five employees to the positions for which
they had applied.
Single employer status. Here, the employer challenged three decisions of the NLRB: (1)
that Grane and Cambria Care were a single employer; (2) its use of the successorship
15
doctrine to find that Grane had a duty to bargain with the union; and (3) that substantial
evidence did not support that the company violated the NLRA by not hiring five
employees.
The Board considers four factors in determining whether separate entities are a single
employer: (1) functional integration of operations; (2) centralized control of labor
relations; (3) common management; and (4) common ownership. Grane asked the appeals
court to reverse the Board’s ruling that the evidence demonstrated Grane controlled the
labor relations at Cambria Care. However, the court declined to do. The employer’s
position rested on discredited testimony by Cambria Care’s top administrator that he, not
Grane, controlled the day-to-day operations at the facility after the transfer. The Board
found that testimony self-serving and overwhelmed by other evidence in the record.
Moreover, the court found significant evidence that Grane made important decisions
relating to establishing the operations of the facility during the acquisition period,
including hiring Laurel Crest’s workforce, determining initial salaries and benefits, and
putting in place a variety of employment policies. In fact, the court observed, the hiring
decisions at issue in this dispute occurred during the period of acquisition.
Further, there was substantial evidence in the record that Grane continued to control
operations at Cambria Care after January 1, 2010. Thus, the Board’s determination that
Grane and Cambria Care was a single employer was based on detailed factual findings
that described two deeply integrated companies with centralized control emanating from
Grane.
Duty to bargain. Next, the appeals court turned to the employer’s challenge to the
NLRB’s use of successorship doctrine to find that it had a duty to bargain with the union.
Generally speaking, under this doctrine a new employer has a duty to bargain with an
incumbent union that represented the predecessor’s employees when there is a substantial
continuity between the predecessor and successor enterprises. In this instance, Grane did
not contest the presence of the requisite substantial continuity. Instead, it argued that the
successorship doctrine cannot be applied where the predecessor employer is a state (or its
political subdivision) not subject to the NLRA. Whether the facility was subject to the
Act when the county operated the facility was not determinative, said the court. Rather,
the employer was being held liable for its own refusal to recognize and bargain with the
union.
Imposition of liability was permissible provided the union had established majority
support under Pennsylvania law and could therefore establish a presumption of majority
support under federal law. There was nothing in the Act that precluded the Board from
finding that certification under Pennsylvania law was sufficient. Thus, the Third Circuit
saw no reason why the NLRB’s determination that the successorship doctrine applied
equally to a public-to-private transition was irrational or inconsistent with the Act. It
therefore joined other Circuit Courts of Appeals in approving the application of the
successorship doctrine in this context.
16
Refusal to hire. Finally, the appeals court examined the Board’s finding that the
company engaged in an unfair labor practice by refusing to hire five former employees.
The Board found that the refusal to hire was motivated by antiunion animus. Here, the
appeals court found that substantial evidence supported the Board’s finding that the
employer’s justification for not hiring the employees was a mere pretext. The employer
asserted that it decided not to hire the employees based on negative references. However,
the Board determined that the proffered reasons were pretextual because that testimony
was contradicted by other evidence and was not internally consistent. Because the court
did not consider this rationale unreasonable, it declined to disturb the Board’s decision.
Thus, it denied the employer’s petition to review and granted the Board’s cross-petition
for enforcement.
The case numbers are 11-4345 and 11-4537.
Attorneys: Richard J. Antonelli (Babst, Calland, Clements & Zomnir) for Employer.
Gregory P. Lauro for NLRB.
4thCir: Claims for coverage under CBA by temporary employees of school district
properly removed to federal court and dismissed
By Ronald Miller, J.D.
A school district properly removed a case brought by a group of temporary employees
seeking to gain benefits under an arbitration award and the underlying collective
bargaining agreement to federal court, ruled the Fourth Circuit (Mayo v Board of
Education of Prince George’s County, April 11, 2013, Niemeyer, P). Moreover, the
appeals court concluded that the lower court properly granted the school district’s motion
to dismiss the temporary employee’s claims in view of the fact that they were expressly
excluded from the bargaining unit, so that neither of their substantive claims stated a
plausible claim for which relief could be granted.
Removal to federal court. Temporary employees of a school district filed a class action
complaint against the district and their union asserting employee compensation claims.
Specifically, they alleged that even though a collective bargaining agreement excluded
“temporary employees” from a bargaining unit, they were entitled to the benefits of an
arbitration award between the district and the union as well as benefits from the
underlying CBA. After the complaint was filed in state court, the school district removed
the matter to federal court. The union also agreed to removal, but the employees opposed
the motion. Before the district court, the employees filed a motion to remand, asserting
that removal was invalid because the union did not timely file its own notice of removal.
The district court dismissed the employee’s complaint for failure to state a claim. After
the district court refused to reconsider its ruling, they filed a notice of appeal.
The union and school district were parties to a CBA that defined the bargaining unit to
include all classified employees except a group including temporary employees. At the
union’s request, the employer provided it the names of all temporary employees who had
been employed for more than 60 days and performed the same work as permanent
17
classified employees. Thereafter, the union filed a grievance contending that the district’s
practice of hiring substitute and temporary employees to fill permanent positions violated
the CBA. The arbitrator ruled in favor of the union, and the parties crafted a settlement
awarding over $1 million in back pay amounts. The district also agreed to hire a
minimum number of full-time bargaining unit employees.
Duty of fair representation. The temporary employees filed this class action in state
court, in which they allege that they were entitled to damages under the arbitration award,
and the union breached its duty of fair representation by misleading them regarding the
award, and they alleged that they were third-party beneficiaries under the CBA.
Ultimately, the matter was removed to federal court where it was dismissed.
On appeal, the temporary employees contended (1) that the Union’s consent to removal
was inadequate to effect a removal on its behalf; (2) that the district court erred in
concluding that the Union did not owe the temporary employees a duty of fair
representation and that they were not entitled to the benefits of the arbitration award; (3)
that the district court erred in dismissing their claim for breach of the CBA based on a
third-party beneficiary theory; and (4) that the district court abused its discretion in
striking their motion for reconsideration of the dismissal order.
The Fourth Circuit concluded that the union adequately consented to the school district’s
notice of removal, and affirmed the district court’s dismissal of the temporary employee’s
complaint for failure to state a claim for relief.
In removing this case from state court to federal court, the school district stated that it had
consulted with the union and that the union had consented to the removal. However, the
union did not sign the notice of removal, nor did it timely file its own notice or a written
consent to the district’s notice. Under such circumstances, the temporary employees
contend that the removal was defective and that the district court erred in refusing to
remand this case to state court.
The text of 28 U.S.C. Sec. 1446 governs the removal of a case to federal court. However,
the statute does not address how a case involving multiple defendants is to be removed or
how the defendants must coordinate the removal, if coordination is required. Nonetheless,
the Supreme Court in Lapides v Bd of Regents of Univ Sys of Ga, construed the statute to
include a “unanimity requirement,” such that all defendants must consent to removal.
Still, neither the statute nor the Supreme Court’s decisions have specified how defendants
are to give their “consent” to removal. The Fourth Circuit has not addressed this precise
question.
Section 1446 requires at least one notice of removal signed by at least one attorney, in
accordance with FRCP 11, attesting to the fact that removal is warranted and is not
pursued for an improper purpose and that the facts alleged are justified and supported.
However, they do not require that in a case involving multiple defendants where all
defendants must consent to removal that each of the defendants sign the notice of
removal or file a separate notice of removal complying with Sec. 1446(b).
18
Thus, the Fourth Circuit saw no policy reason why removal in a multiple-defendant case
cannot be accomplished by the filing of one paper signed by at least one attorney,
representing that all defendants have consented to the removal. Moreover, in this case,
the union did file papers early on, signed by its attorney, indicating that it had consented
to the removal.
Accordingly, the appeals court concluded that a notice of removal signed and filed by an
attorney for one defendant representing unambiguously that the other defendants consent
to the removal satisfied the requirement of unanimous consent for purposes of removal.
Because the union adequately consented to the removal filed by the school district,
removal was effective in this case and that the district court did not err in declining to
remand the case to state court. The judgment of the district court was affirmed.
The case numbers are 11-1816 and 11-2037.
Attorneys: Richard T. Seymour (Law Offices of Richard T. Seymour) for Employees.
Abbey G. Hairston (Thatcher Law Firm) for Employer.
7thCir: Rescission of unilateral changes in working conditions was appropriate
restoration of status quo, not micro-management by court
By Ronald Miller, J.D.
A district court’s denial of interim relief for unilateral changes made by an employer
between a union election and the union’s certification was reversed by the Seventh
Circuit (Harrell v American Red Cross, April 23, 2013, Cudahy, R). Although the court
below had reasoned that rescission of the unilateral changes would force it to “micromanage” employment relationships, the intent of Sec. 10(j) is to “restore the status quo’
as it existed before the onset of the unfair labor practices, and the lower court also had
found that the unilateral changes had disturbed the status quo. Moreover, the district
court’s finding of judicial micro-management was misplaced, since rescission of the
changed terms would merely return the parties to the lawful status quo. On the other
hand, the district court did not abuse its discretion by ordering restoration of the merit pay
program.
In 2007, blood collection specialists for the American Red Cross (ARC) elected a new
union. During the unionization process, ARC filed repeated objections, forcing election
ballots to be impounded and delaying certification of the union. These objections were
later overruled by the NLRB. In the meanwhile, during the period between the election
and the union’s 2010 certification, ARC made a number of changes in the terms and
conditions of employment for its union-represented employees. Those changes were
made without notice to or bargaining with the new union. As a result of the employer’s
unilateral changes, worker involvement in union activities declined precipitously.
Employees feared retaliation by ARC if they associated with the union, and some
employees were discouraged by the union’s failure to prevent the employer’s suspension
of a merit pay program.
19
The union and NLRB sought injunctive relief from the employer’s unilateral changes in
working conditions pending the Board’s administrative proceedings against ARC. An
administrative law judge held that the employer acted unlawfully by making these
unilateral changes. ARC, however, argued that it could make these changes because the
union was not yet certified due to pending objections. The district court found that the
NLRB had shown a likelihood of success on the merits and that the newly formed union
had suffered irreparable harm because of ARC’s unilateral changes. However, it ordered
only a rescission of ARC’s failure to grant scheduled merit pay increases to unit
employees (and not the other unilateral changes made), although it issued a subsequent
temporary injunction prohibiting ARC from making further unilateral changes to
employment conditions. Both parties appealed.
Injunctive relief. On appeal, ARC wanted to lift the injunction, while the NLRB wanted
an order for rescission of the remaining unilateral changes made by the employer.
Applying well-settled law, the appeals court determined that the Board satisfied each
criterion for finding injunctive relief: (1) the NLRB has no adequate remedy at law; (2)
the union will be irreparably harmed without interim relief, and that potential harm to the
union outweighs potential harm to the employer; (3) public harm would occur without the
relief; and (4) the Board has a reasonable likelihood of prevailing.
As an initial matter, the appeals court observed that it is well established that “an
employer who makes unilateral changes pending a decision on union certification
objections acts at its peril.” Here, the Board demonstrated the irreparable harm resulting
from ARC’s unilateral changes that prevented the union from discussing these terms and
conditions of employment, and therefore, “strike at the heart of the Union’s ability to
effectively represent the unit employees.” These unilateral changes included: suspending
employees’ merit pay increases; discontinuing matching contributions to employees’
401(k) plan; closing the defined pension plan to new employees; changing health
insurance benefits; promoting team leaders to team supervisors while having them
continue to perform unit work; reassigning bargaining unit work outside the bargaining
unit; and decreasing the number of personal time-off hours an employee could carry over.
Further, in light of the decline in employee participation in union activities following
ARC’s unilateral changes, back pay alone would not remedy the adverse impact to the
union, as well as the employees, in the interim period.
Also at stake in a Sec. 10(j) proceeding is the public interest in the integrity of the
collective bargaining process. Here, the harm posed to the union of allowing unilateral
changes to stand was apparent in the fact that the union had already become less popular
with the employees, which was enough, said the appeals court. Consequently, in view of
the fact that all four factors favored interim injunctive relief, the district court did not
abuse its discretion in granting partial relief by ordering the rescission of the merit pay
freeze.
Micro-management. But it did not go far enough. Despite recognizing that ARC’s
actions were potentially harmful and necessitated injunctive relief, the district court
granted only partial relief. Applying the same four-factor analysis, the Seventh Circuit
20
found that the district court’s limited injunction failed fully to address the harms that it
recognized. Although the district court reasoned that rescinding all of the changes made
by ARC would require it to “micro-manage the employment relationship,” concluding
that those changes were best addressed in bargaining discussions, it cited no specific
evidence of practical difficulties in rescinding the remaining changes or what it meant by
“micro-managing” the employment relationship. Thus, the lower court abused its
discretion in failing to order rescission for all of ARC’s unilateral actions. The district
court’s denial of interim relief for the other unilateral changes was reversed.
The case numbers are 12-1264 and 12-1362.
Attorneys: John A. Mantz for NLRB. Michael J. Modl (Axley Brynelson) for Employer.
8thCir: Arbitrator exceeded authority under CBA by reinstating employee
terminated for just cause following child pornography conviction
By Ronald Miller, J.D.
A district court properly vacated an arbitrator’s award after concluding that, in reinstating
an employee who had been convicted of possession of child pornography, he exceeded
his authority under a collective bargaining agreement, ruled a divided Eighth Circuit (21) (Northern States Power Co dba Xcel Energy v Electrical Workers (IBEW), Local 160,
April 1, 2013, Shephard, B). Once the trial court determined that the employer had “just
cause” to terminate the employee, he had no authority to fashion a remedy other than
termination, ruled the appeals court majority. Judge Murphy dissented.
Child pornography conviction. In July 2010, the employer conducted a routine
background check of the employee and discovered that he had recently pled guilty to
three felony counts of possession of child pornography. The employee was sentenced to
probation and did not inform the employer of his conviction or the terms of his probation.
One of those terms was that the employee was to have “no contact with a minor until
approved.” Upon learning of the terms of the probation, the employer determined that it
could not guarantee that the employee would have no contact with a minor while
performing his job duties and terminated his employment. The union filed a grievance on
his behalf and the matter was submitted to arbitration. Ultimately, the arbitrator ordered
the employer to return to work at a comparable position without back pay.
The employer filed this action to vacate the arbitration award on the basis that after the
arbitrator found “just cause” for the employee’s termination, his subsequent reinstatement
of the employee exceeded his authority under the CBA. The district granted vacated the
arbitrator’s award of reinstatement.
“Just cause” termination. Here, the Eighth Circuit had to determine whether the
arbitrator concluded that the employer had “just cause” for terminating the employee.
While the union argued that the arbitrator found no just cause, the employer said that the
arbitrator did find that it had just cause to terminate the employee, but then exceeded his
21
authority under the CBA by reinstating his employment. According to the employer, it
was irrelevant that the employer did not use words “just cause” in discussing the
employer’s termination of the employee.
In finding that the arbitrator exceeded his authority, the Eighth Circuit looked to
decisions of the Second Circuit in 187 Concourse Assoc v Fishman and the Fifth Circuit
in Am Eagle Airlines, Inc v Air Line Pilots Ass’n Int’l, along with its own prior decision
in St Louis Theatrical Co v St Louis Theatrical Brotherhood Local 6. The language of the
arbitrator’s decision that the employer had demonstrated justification for its decision to
terminate the employee was sufficient to show that the arbitrator found the termination
was supported by “just cause.” Having answered that question in the affirmative, he
simply had no authority to address the question whether reinstatement was warranted or
to fashion a remedy different from termination. Thus, the appeals court ruled that the
district court properly vacated the arbitrator’s award for reaching beyond his authority
under the CBA.
Dissent. In dissent, Judge Murphy argued that the arbitrator’s award did not reveal that
he clearly made a finding of “just cause.” Rather, he argued that the arbitrator’s order to
reinstate the employee to his position drew its essence from the CBA, and the district
court’s decision should be reversed and the arbitration award enforced.
The case number is 12-1186.
Attorneys: Michael John Moberg (Briggs & Morgan) for Employee. Richard Allen
Williams, Jr. (Williams & Iversen) for Employer.
11thCir: Denying temporary reinstatement to employees involved in union
organizing campaign not abuse of court’s discretion
By Ronald Miller, J.D.
The Eleventh Circuit upheld a federal district court’s refusal to issue a Sec. 10(j)
temporary injunction requiring an employer to temporarily reinstate six employees
allegedly discharged because they were involved in a union organizing campaign because
the requested injunctive relief was not just and proper (NLRB v Hartman and Tyner, Inc
dba Mardi Gras Casino, April 16, 2013, Marcus, S). There were no allegations of any
ongoing unfair labor practices after the six discharges at issue, nor any indication that the
violations reasonably found to have been committed would be repeated absent an
injunction.
Union organizing campaign. The employer operated a casino and greyhound racetrack,
employing approximately 220 employees. In 2004, the employer and a union entered into
a memorandum of agreement (MOA) in which the employer committed to take a “neutral
approach to unionization,” essentially agreeing to recognize the union as collective
bargaining representative if a majority of employees signed union authorization cards. In
turn, the union agreed not to engage in organizing efforts in the casino’s public areas or
22
during the employees’ working times. The MOA was set to expire on December 31,
2011, and the employer’s workforce remained non-unionized. In the face of this deadline,
the union mounted a full campaign to organize the workforce, including assembling an
employee organizing committee.
About six weeks before the deadline, union representatives made an unannounced visit to
the casino, ostensibly to introduce themselves to the casino’s management. Eight off-duty
employees who were also on the employee organizing committee were part of the
delegation. According to the union, it intended to exercise its right under the MOA to
access the non-public areas of the casino to speak with employees. On the other hand, the
employer viewed the visit as a highly public stunt in order to spur the flagging union
organizing campaign. It asserted that the union delegation stormed the casino and caused
a disruption. The union was asked to leave, and it did.
Reinstatement request. The following day, the union delegation returned to the casino
with off-duty employees; this time, the delegation did not leave until after police were
summoned. It claimed that it was asserting its rights under the MOA. The next day five of
the employees who participated in the union visit were discharged. A sixth discharge
involved a member of the organizing committee who allegedly interfered with a
coworker’s work by discussing union business while the two were on duty. The union
filed charges with the NLRB. An administrative complaint issued and subsequently, an
NLRB regional director sought a Sec. 10(j) injunction, in part to reinstate the six
discharged employees. Following an evidentiary hearing, the district court denied the
petition’s request for temporary reinstatement of the discharged employees.
Legal standard. As an initial matter, the appeals court observed that the district court
applied the correct legal standard, recognizing that interim injunctive relief should be
granted only when two conditions are satisfied: (1) there is reasonable cause to believe
that the alleged unfair labor practices have occurred, and (2) the requested injunctive
relief is just and proper. The district court found that the NLRB had met both the legal
and factual components of the first prong. At issue on appeal, however, was whether the
district court abused its discretion in concluding that interim reinstatement of the
discharged employees was not “just and proper.”
Just and proper standard. With respect to whether the injunctive relief of reinstatement
was “just and proper,” the district court observed that the union’s organization drive had
“grown cold” prior to any of the discharges at issue. It also noted that it took the NLRB
more than six months after the terminations and more than four months after the union
brought the terminations to its attention before it filed its Sec. 10(j) petition.
Consequently, the district court concluded that the remedy of temporary reinstatement
was neither “just” nor “proper.”
Congress enacted Sec. 10(j) because administrative resolution was so time-consuming
that guilty parties could violate the NLRA with impunity during the years of pending
litigation, thereby often rendering a final order ineffectual or futile. Employee
reinstatement, however, has been singled out as a particularly drastic remedy.
23
Injunctive relief satisfies the “just and proper” standard “whenever the facts demonstrate
that without such relief, any final order of the Board will be meaningless or so devoid of
force that the remedial purposes of the NLRA will be frustrated. A district court abuses
its discretion “when it misconstrues its proper role, ignores or misunderstands the
relevant evidence, and bases its decision upon considerations having little factual
support.”
None of those things occurred in this case. To begin with, the district court did not
misconstrue its role but articulated and applied the relevant legal standards. Moreover,
the NLRB did not claim that the district court erred in this respect. Importantly, the
district court did not make unsupported findings or ignore key evidence. It concluded that
the union’s organizing campaign had grown cold prior to the discharges, and that in light
of the NLRB’s delay in bringing charges, no lingering harm caused by the discharges
remained that would be better alleviated by temporary injunctive relief as compared to a
final Board order. Both of those conclusions were amply supported by the record,
reasoned the appeals court. Finding that the district court did not abuse its discretion, the
appeals court affirmed its judgment.
The case number is 12-14508.
Attorneys: Elinor L. Merberg for NLRB. Robert Louis Norton (Allen Norton & Blue) for
Employer.
11thCir: No evidence that unions’ failure to pursue untimely grievance was
discriminatory
By Joy P. Waltemath, J.D.
Unwilling to reverse summary judgment granted to a union and its local, the Eleventh
Circuit ruled in an unpublished decision that a terminated union member had not
established a prima facie case of discrimination based on the unions’ refusal to grieve her
termination (Gilmore v National Mail Handlers Union Local 318, April 23, 2013, per
curiam). The member, an African-American female, presented no evidence that the local
union, which refused to pursue her grievance because it was untimely, treated a white
male employee’s untimely grievance differently where the local dismissed his grievance
as soon as it discovered it was untimely. And, because she presented no evidence of any
similarly situated individual outside her protected class, the national union’s refusal to
grieve her termination because it didn’t file grievances on behalf of any individual
employees could not be shown to be discriminatory.
The postal service terminated the employee for unsatisfactory attendance by a letter dated
September 5, which she claimed she did not receive until October 16 because she had
moved. She contacted the local union by phone that day to find out why she had been
terminated, but she did not make a written request that the local file a grievance until late
December. The local refused, saying the 14-day window to file a grievance had expired
back on September 19 (based on the date of the termination letter). After she contacted
24
the national union, which also refused to grieve her termination because it filed no
individual employee grievances, she sued, alleging a host of claims.
Title VII, Sec. 1981 claims. Only the employee’s race and gender discrimination claims
proceeded to the summary judgment stage, which the district court granted in the unions’
favor. On appeal, the court found no reason to disturb this ruling. The local union
presented undisputed evidence that it had dismissed the alleged white male comparator’s
grievance as soon as it discovered it was untimely. Also, the national union’s evidence
that it simply did not pursue grievances on behalf of individuals was similarly
undisputed.
Dismissed claims for breach of contract, retaliation, and conspiracy. These claims
were dismissed by the district court, and the appeals court summarily noted why it
agreed. First, the employee’s claim that the unions breached the collective bargaining
agreement’s discrimination provision was concededly essentially the same claim as her
Sec. 1981 claim, which the lower court dispensed with on summary judgment. Second,
the employee claimed the unions retaliated against her for filing charges with the NLRB
and EEOC; however, she filed those charges after the unions refused to pursue her
grievance, and so could not plead any plausible causal retaliatory connection. Moreover,
her claim that the unions had jointly conspired to violate her Title VII and Section 1981
rights was not cognizable. Finally, the failure to grant her motion for sanctions against
both unions was not an abuse of the district court’s discretion, concluded the appeals
court.
The case number is 12-14019.
Attorneys: Tammy Gilmore, pro se. Tobe Lev (Egan Lev & Siwica) for local Union.
Bruce R. Lerner (Bredhoff & Kaiser) for national Union.
DCCir: Exec’s statements reflected merely that he would not personally attend
bargaining sessions, not that hospital would refuse to negotiate with union
By Joy P. Waltemath, J.D.
Statements by a hospital president during an organizing campaign were not, in the overall
context of his comments, a threat that unionization would be futile, the D.C. Circuit
ruled, granting the hospital’s petition for review (Flagstaff Medical Center, Inc v NLRB,
April 26, 2013, Brown, J). Nor was the termination of a button-wearing employee for
attendance problems that concededly entitled the hospital to fire him an unlawful attempt
to discourage union activity. However, the appeals court agreed with the Board that
substantially changing the work schedule of another employee, apparently within days of
her appearing in a pro-union newspaper ad, was unlawful, and it granted the Board’s
cross-application for enforcement on this charge.
In the midst of a union campaign to organize the hospital’s housekeeping and food
services employees, the hospital president met with food service workers to “learn about
25
employees’ issues, concerns, and problems.” The hospital president said that he
appreciated the “direct activity,” that “with a union it would be difficult to have that same
direct communication,” and indicated that he didn’t believe a union would be necessary
for the hospital. Following those statements, he went on to say words to the effect that if
there was a union, “I would not be negotiating with the union,” or, “you won’t be
negotiating with me.” The ALJ dismissed the Sec. 8(a)(1) charges as to these statements
but the Board reinstated them, suggesting employees reasonably could interpret them to
mean the hospital would not bargain with the union and that they were an unlawful threat
that unionization would be futile.
President’s statements. The court found itself “baffled” by the Board’s “interpretive
leap” that the president’s statements indicated unwillingness for the hospital to bargain
with the union rather than merely a statement about his own personal attendance at
whatever bargaining meetings might occur. Given the totality of the circumstances,
especially testimony from outspoken union advocates who all qualified his statement to
have been that with a union, they wouldn’t be having “any meetings with him like this,”
the court was unconvinced that the Board’s interpretation was accurate. Moreover, it took
the Board to task for its oral argument comment that the court should not second-guess
the Board’s expertise on the president’s demeanor or tone in making the comments.
Instead, it pointedly remarked that it was the ALJ who was charged with evaluating
witness credibility, and the ALJ found no violation here.
Termination for absenteeism. It was undisputed that the housekeeper, terminated in
August after he began wearing a union button in July, had a record of poor attendance
that warranted his termination under the hospital’s attendance policy. Indeed, he had
already received verbal and written warnings and a three-day suspension. Leading up to
his August termination, he was absent once in May, once in June, and twice in July. Even
though his termination was not ordered until after he began wearing the union button, the
court found this easily explained by the fact that a new interim director of housekeeping
took over in June, and he didn’t know about the employee’s latest absences until the
department secretary told him. The court was unwilling to credit the Board’s arguments
that either the interim director or the VP who approved the firing was shown to have an
actual or imputed unlawful motive, and it would find no Sec. 8(a)(1) and (3) violations
here.
Scheduling change after pro-union ad. Disagreeing with the hospital’s position, the
court did find that the unusual changes to the June work schedule of an employee who
appeared in a late May pro-union newspaper ad were based on unlawful antiunion
animus. The department director assigned the employee a very unusual shift schedule—
lots of weekends—soon after the employee’s very public ad supporting the union, which
the director admitted seeing. This same director told employees not to discuss their
wages, interrogated an employee about the usefulness of a union (and in the process,
called the nurses’ union “foolish”), and implicitly suggested a newly hired employee
would be laid off if the hospital unionized. The hospital attempted to raise an issue about
the timing of the work schedule’s release, including whether it was in fact so unusual, but
the court would not consider these arguments because they were not raised before the
26
Board and there were no extraordinary circumstances to justify their consideration.
Accordingly, the court granted the Board’s petition for enforcement in this respect.
The case numbers are 11-1326 and 11-1398.
Attorneys: Steven Dean Wheeless (Steptoe & Johnson) for Employer. Elizabeth Ann
Heaney for NLRB.
NLRB: Employer’s assault of union rep while ejecting him from construction site
trailer was unlawful interference under NLRA
By Ronald Miller, J.D.
An employer acted unlawfully where its construction superintendent ordered two union
reps to leave a construction jobsite and physically assaulted one of them in ejecting him
from a construction trailer after they warned him of the possibility of area standards
picketing at the site, ruled the NLRB (Norquay Construction, Inc, April 15, 2013). The
physical assault was plainly in response to the union rep’s protected activity of seeking
work for union represented employees, and therefore, violated NLRA Sec. 8(a)(1).
The employer was the general contractor on a construction project to renovate the
municipal bus station in Phoenix, Arizona. Although the employer was non-union, the
employees of the concrete subcontractor were represented by a local union affiliated with
the Southwest Regional Council of Carpenters. Under the union’s contract with the
subcontractor, it was to have access during working hours to jobsites were the
subcontractor’s employees were working, so long as they made reasonable efforts to
notify the subcontractor of their presence on the site and did not interfere with work.
Area standards. The employer’s project superintendent maintained a construction trailer
as an office at the construction site. He posted a sign prohibiting solicitation without an
appointment. Representatives of the union entered the trailer without an appointment,
identified themselves and asked for subcontractor information on some carpentry-related
work. They advised the superintendent that had they been aware that the employer had
more subcontracting work to bid out they would have given him the union’s list of area
standards contractors. In response, the superintendent told the union reps to look up the
information in a publicly available source, and complained that union reps were coming
to the jobsite every day. They warned him that the union could picket the site if it had a
labor dispute, but added that it would picket only if area standards wages were not being
paid.
The representatives’ statement triggered an angry response by the superintendent, who
loudly and profanely demanded they leave the trailer. As they did so, he pushed one of
them in the back. When the representative objected, the superintendent pushed him a
second time, causing him to fall and strike his hand and neck on a railing. The reps
reported the incident to their superiors and the police were called, but they did not arrest
the superintendent. Thereafter, the union filed a complaint with the NLRB. Although an
27
administrative law judge characterized the superintendent’s conduct as “repugnant and
inexcusable,” she dismissed the complaint.
Legitimate goals. On review, the NLRB disagreed with the law judge. The Board found
that the union representatives were engaged in protected activity when they visited the
trailer and the superintendent’s physical assault of one of them in response to that activity
violated NLRA Sec. 8(a)(1). Here, the union reps entered the employer’s trailer for the
purpose of soliciting it to use area standards contractors for future work. That activity
was “undisputedly protected under Sec. 7.” This objective of expanding employment
opportunities for represented employees plainly sought to further legitimate goals under
Sec. 7.
In defense of its conduct, the employer neither contested the inherently protected nature
of the purpose of the rep’s visit, nor did it argue that they engaged in any threatening
behavior. Rather, the employer contended that its actions did not violate the Act because
it had an exclusionary property interest in its trailer sufficient to justify the exclusion of
the representatives, who did not comply with its lawful rule prohibiting solicitation
without an appointment.
However, the Board disagreed with the employer’s assertions. The employer’s asserted
right to exclude the union reps from the trailer was irrelevant because they were leaving
the trailer at the time of the assault. Moreover, the superintendent did not invoke that
right, but instead invited them into his office. It was not until the union reps began to
engage in protected activity that the superintendent asserted the right to exclude them.
Even though the union reps were complying with the superintendent’s order to leave, he
nevertheless assaulted one of them as he left the trailer. In these circumstances, any right
to deny the representatives access to the trailer did not constitute a defense to the Sec.
8(a)(1) violation, declared the Board.
The slip opinion number is 359 NLRB No 93.
Attorneys: Johannes Lauterborn for General Counsel. Frederick C. Miner (Littler
Mendelson) for Employer. Thomas E. DeMott for Union.
NLRB: Employer unlawfully refused nonemployee union rep access to facility to
conduct safety inspection after fatal accident
By Ronald Miller, J.D.
Caterpillar acted unlawfully when it refused to grant a nonemployee union representative
access to its facility to conduct a health and safety inspection after a fatal accident, ruled
a three-member panel of the NLRB (Caterpillar Inc, April 23, 2013). Here, the Board
determined that an administrative law judge properly applied the balancing test
articulated in Holyoke Water Power Co to conclude that under circumstances implicating
significant health and safety issues, the employer’s property rights had to yield to the
employees’ right to responsible representation. Finding that Caterpillar had not
28
demonstrated a compelling confidentiality interest, the Board deleted a requirement in the
ALJ’s remedy requiring the union to sign a confidentiality agreement prior to the
company granting access.
Agreeing with the Acting General Counsel, the Board concluded that the ALJ’s finding
that Caterpillar had a “significant competing interest” in protecting its confidential
manufacturing processes was at odds with his further finding that the employer had a
“considerable history” of allowing visitors access to the plant. The Board has long
considered access granted to third parties a relevant factor under Holyoke, as allowing
others to enter the property weakens the relative strength of the employer’s interest in
denying the union access to its property.
In view of testimony by a union official that nonemployees have accessed the employer’s
facility since it was acquired, a Caterpillar regional manager’s concession that the risks of
disclosing confidential information by allowing access had not changed since the
acquisition, Caterpillar’s lax approach to the admission of documents at hearing, and its
failure to raise confidentiality concerns before the law judge, the Board found that it
failed to demonstrate a confidentiality interest that would warrant conditioning access
upon execution of a confidentiality agreement. Consequently, the Board amended the
ALJ’s remedy to delete the requirement that the parties bargain over and reduce a
confidentiality agreement to writing prior to granting access to a nonemployee union
representative.
The slip opinion number is 359 NLRB No 97.
Attorneys: Benjamin Mandelman for Acting General Counsel. Joseph J. Torres (Winston
& Strawn) for Employer. Marianne Goldstein Robbins (Previant, Goldberg, Uelmen,
Gratz, Miller & Brueggeman) for Union.
NLRB: Employees’ Facebook postings constituted protected concerted activity,
their discharge and employer’s wage disclosure rules unlawful
By Ronald Miller, J.D.
An employer acted unlawfully by discharging three employees for engaging in protected
activity and by maintaining a wage and salary disclosure rule prohibiting disclosures of
wages or compensation to any third party or other employees, ruled a three-member panel
of the NLRB (Design Technology Group, LLC dba Bettie Page Clothing, April 19,
2013). With respect to two employees, the Board determined that their Facebook postings
complaining about a supervisor’s conduct as it related to terms and conditions of
employment, and about management’s refusal to address their concerns, constituted
protected concerted activity. Further, a third employee was unlawfully discharged even
though her contributions to the Facebook postings were characterized as “rather
innocuous,” where it was evident that the employer connected her with the protected
concerted activities of her coworkers.
29
Discharge conspiracy. Two of the employees engaged in protected activity when they
presented the concerns of employees about working late in an unsafe neighborhood to
their supervisor and to the employer’s owner. The Board determined that their Facebook
postings were a continuation of that effort. Moreover, it found that the Facebook postings
constituted protected concerted activity in and of themselves. In this instance, the
Facebook postings were complaints among the employees about the conduct of their
supervisor as it related to their terms and conditions of employment, and about
management’s refusal to address their concerns. The employees also discussed looking at
a book about the rights of workers in California so they could determine whether the
employer was violating labor laws. The Board found such conversations for mutual aid
and protection were classic concerted protected activity, even absent prior action.
Here, the employer contended that the Facebook postings were not protected because the
employees had “no honest and reasonable belief” that the purpose of their conduct was
for the mutual aid and protection of employees, and that they “schemed to entrap the
employer into firing them.” However, an administrative law judge correctly rejected the
employer’s “discharge conspiracy” theory. There was no credited evidence that the
employees’ actions were undertaken to entrap the employer into committing unfair labor
practices.
Perceived connection. The Board also agreed that the employer acted unlawfully with
respect to the discharge of a third employee. This employee was a minor participant in
the Facebook conversation; however, credited evidence established that the employees’
supervisor linked her discharge to the discharge of the two other employees and
disapproved of their continued association. Shortly after the first two employees were
discharged, the supervisor noticed that the third employee received a text message from
one of them. The supervisor responded that she was tempted to put a “gag order” on the
employee so that she would not be able to talk with others about her working conditions.
Consequently, it was clear that the employer believed that the employee was linked to the
protected activity of her coworkers.
Because the employer had never discharged any employee for habitual lateness, the
Board agreed with the ALJ that the employer’s reliance on the employee’s record of
tardiness to justify her discharge was a pretext. Thus, the Board adopted the ALJ’s
findings that the employer failed to establish the employee would have been terminated
in the absence of her protected concerted activity and her perceived connection with two
other employees who had engaged in protected concerted activity.
The slip opinion is 359 NLRB No 96.
Attorneys: Christy J. Kwon for General Counsel. David R. Koch (Koch & Scow) for
Employer. David A. Rosenfeld (Weinberg, Roger & Rosenfeld) for Union.
30
NLRB: Unilateral changes by employer and maintenance of work rules unlawfully
infringed employee rights under NLRA
By Ronald Miller, J.D.
A hotel operator acted unlawfully when it made changes to the working conditions of
bargaining unit employees during the period while the parties were engaged in
negotiations for a successor collective bargaining agreement, ruled a three-member panel
of the NLRB (Remington Lodging & Hospitality, LLC d/b/a The Sheraton Anchorage,
April 24, 2013). Moreover, work rules maintained by the hotel in its employee handbook
reasonably tended to chill the protected activity of hotel employees.
Notice of contract modification. The employer violated its duty to bargain in good faith
when it unilaterally implemented certain changes to the employment terms and
conditions of bargaining unit employees. Under Sec. 8(d)(3) of the NLRA, “no party to a
collective bargaining agreement shall terminate or modify such contract, unless the party
desiring such termination or modification” first provides at least 30 days’ notice to the
FMCS regarding the parties’ labor dispute. Consistent with that statutory language, the
Board places the burden of notifying the FMCS on the party initiating contract
modification or termination. Here, the employer initiated the modification of the contract
but failed to notify the FMCS of the parties’ labor dispute before making the changes.
Accordingly, the NLRB found that those changes were unlawful.
The Board also found that the employer acted unlawfully by disciplining nine off-duty
employees for peacefully presenting a boycott petition to the hotel’s general manager in
the hotel lobby. Here, the Board ruled that the employer failed to adequately except to an
administrative law judge’s findings as required under Sec. 102.46(b)(1) of the Board’s
Rules and Regulations. Specifically, the employer briefly alluded to the discipline when
excepting to the law judge’s separate and distinct finding that a decertification petition
was tainted by its unfair labor practices. However, the employer failed to offer a
sufficiently specific argument for overturning the ALJ’s finding that the discipline
constituted an unfair labor practice. Thus, the Board adopted the law judge’s findings on
procedural grounds.
Unlawful work rules. Also adopted by the NLRB was the law judge’s finding that the
employer violated Sec. 8(a)(1) by maintaining and enforcing eight work rules contained
in its employee handbook. A work rule is unlawful under Lutheran Heritage VillageLivonia if it explicitly restricts Sec. 7 activity or if there is a showing that (1) employees
would reasonably construe the language to prohibit Sec. 7 activity; (2) the rule was
promulgated in response to union activity; or (3) the rule has been applied to restrict the
exercise of Sec. 7 rights. Relying on the third prong, the Board adopted the ALJ’s
findings with respect to rules confining employees to the area of their job assignment or
work duties; against distribution of literature in guest areas or work areas; against having
a conflict of interest with the hotel; against behavior that violates common decency or
morality or publicly embarrasses the hotel; and against insubordination.
31
Here, the employer cited those rules when it unlawfully disciplined the nine employees,
or when it later discharged four of the same employees for distributing leaflets on hotel
property. Under these circumstances, continued maintenance of those rules reasonably
tended to chill further protected activity.
Facially invalid rules. Additionally, the Board agreed with the law judge that three other
rules in the employer’s handbook were facially invalid. An access restriction prohibited
employees from returning to the hotel before or after working hours without authorization
by a manager. Although the access rule was disseminated to all employees, it otherwise
failed the first and third prongs of Tri-County Medical Center, since it was not limited to
the interior of the hotel, and it did not restrict off-duty access for all purposes, but left
management with unfettered discretion to grant or deny access for any reason it chose.
The employer’s rule governing employee disclosure of confidential information was also
facially overbroad. Under that rule employees were not to disclose confidential or
proprietary information except for the exclusive benefit of the hotel. The Board has
repeatedly held that similarly worded confidentiality rules are unlawfully overbroad
because employees would reasonably believe that they are prohibited from discussing
wages or other terms and conditions of employment with nonemployees, such as union
representatives. Applying that reasoning, the Board found the employer’s confidentiality
rule unlawful.
Finally, the Board found that the employer’s rule governing employee communications
with the media facially overbroad. Under that rule, employees had to agree not to give
any information regarding the hotel, its guests or employees, without prior authorization
from the general manager and to direct inquiries to his attention. Here, the Board
observed that employees enjoy a Sec. 7 right to publicize a labor dispute, including
communicating with the media and public at large. The employer’s rule, which barred
employees from communicating “any information” regarding themselves to the media,
clearly restrained such protected activity.
Refusal to bargain. The employer also acted unlawfully in withdrawing recognition
from the union after supervisors unlawfully assisted a decertification campaign by
soliciting the signatures of three employees on a decertification petition. Moreover, a
supervisor unlawfully threatened one of the employees with an increased likelihood of
discharge if he did not sign the petition and promised him beneficial treatment if he did
sign. Under SFO Good-Nite Inn, this unlawful interference gave rise to an irrebuttable
presumption that the petition did not reflect the uncoerced sentiment of a majority of unit
employees. Consequently, the employer was unable to rely on the tainted petition, and so
its withdrawal of recognition was unlawful.
Implementation of incentive plan. However, contrary to the law judge, the Board
determined that the employer violated its bargaining duty when it unilaterally
implemented an incentive plan for its housekeepers. Without notifying the union or
bargaining with it, the employer posted a memo offering housekeepers $25 gift cards if
the hotel reached a 9.0 or better cleaniness rating from guests or if an individual
32
housekeeper was mentioned positively by name in an online survey. The law judge
dismissed this allegation, reasoning that the employer’s unilateral action was de minimis,
and that it was rescinded after being in effect only 24 hours. However, the Board agreed
with the General Counsel that there was no evidence to support the ALJ’s finding that the
incentive plan was rescinded 24 hours after it was rolled out to employees, or that
employees were informed that the incentive plan was rescinded.
On the other hand, the Board agreed with the law judge’s dismissal of allegations that the
employer acted unlawfully by unilaterally subcontracting its bellmen’s driving duties.
Here, the parties’ CBA eliminated notice and bargaining obligations when subcontracting
was not reasonably expected to result in the layoff of unit employees. Based on the fact
that no bellman was in fact laid off as a result of the subcontracting, together with the
union’s clear and unmistakable waiver of its right to bargain over the subcontracting of
driving duties, the employer acted lawfully.
The slip opinion number is 359 NLRB No 95.
Attorneys: Mara-Louise Anzalone for General Counsel. Arch Y. Stokes (Stokes Roberts
& Wagner) for Employer. Dmitri Iglitzin (Schwerin Campbell Barnard Iglitzin & Lavitt)
for Union.
NLRB: Casino did not promulgate oral rule requiring security guards to follow
chain of command to resolve complaints
By Ronald Miller, J.D.
A three-member panel of the NLRB reversed an administrative law judge’s finding that
during a union organizing drive, a casino promulgated and enforced an oral work rule
that employees had to follow the chain of command to resolve their complaints
(Flamingo Las Vegas Operating Co, LLC, April 25, 2013). Similarly, the Board reversed
an ALJ ruling that certain statements made by a supervisor regarding the union activities
of an employee created an impression that he learned of those activities by conducting
surveillance of the employee.
As a result of unacceptably low customer satisfaction surveys, the casino introduced the
concept of “Believe or Leave”—intended to stress to employees the need to believe in the
importance of customer service. Security guards at the employer’s casino were involved
in a union organizing campaign. On his way into work, the guard who had been most
active in trying to organize the union encountered the casino’s assistant general manager
who proceeded to yell at the guard stating he was upset and felt “betrayed” because of his
union activity, which he said placed the manager’s job in jeopardy. The Board agreed
with the ALJ that these statements conveyed an unlawful threat of discharge.
Chain of command. However, the GM also made several comments regarding the
“chain of command.” The GM stated that all of the guard’s issues had been taken care of
by management, questioned why the employee had not gone to human resources with his
33
complaints, and asked how the employee could get the union involved with the security
guards. As a result, the law judge concluded that the GM was promulgating a rule
requiring employees to bring complaints through human resources and through the chain
of command.
However, the Board agreed with the casino that the GM did not promulgate a rule. The
Board referred to its decision in St Mary’s Hospital of Blue Springs, as instructive of
when an oral statement by a supervisor constitutes a rule. As in St Mary’s, the GM
directed his chain of command comment solely to the guard. Further, there was no
evidence that a “chain of command” rule was ever communicated to the security guards
as something they were expected to obey. Apart from the GM’s isolated statements, there
was no evidence that any of the employer’s managers objected to a failure to follow the
chain of command. Under such circumstances, the GM’s comments regarding the “chain
of command” could not reasonably be interpreted as implementing a new policy on how
employee complaints should be handled.
Impression of surveillance. The law judge also found that comments by a security
supervisor to casino security guards that an unnamed guard the supervisor described as
the “instigator of the union situation” was given his job as a favor because he had family
problems, and also described as someone trying to represent the employees who got his
job because he was “juiced in,” created an impression of surveillance. However, the
Board observed that it was an “open secret” which guard was the chief proponent of the
union. Moreover, the Board agreed with the employer that because the employee was a
self-identified union leader at the time of the supervisor’s comments, the other guards
would not understand the supervisor’s comments as creating an impression of
surveillance.
The Board’s test for determining whether an employer has created an impression of
surveillance is whether an employee would reasonably assume from the statement in
question that his or another employee’s union activities had been placed under
surveillance. Here, it was clear from the record that the union proponent had directly
represented himself to management as involved in the union organizing process. He had
asked management if a union representative could come speak to the security guards, and
offered his services to the guards if they had questions about the union. Because the
employee had openly identified himself to management and to other security guards as a
union organizer, prior to the supervisor’s comments, the Board concluded that those
guards hearing the remarks would not reasonably conclude that the supervisor learned of
the employee’s union activity through surveillance.
The slip opinion number is 359 NLRB No 98.
Attorneys: Larry A. Smith for General Counsel. John D. McLachlan (Fisher & Phillips)
for Employer. Scott A. Brooks (Gregory, Moore, Jeakle, Heinen & Brooks) for Union.
34
NLRB: Casino unlawfully discharged workers involved in union organizing efforts
By Ronald Miller, J.D.
During a union organizing campaign, a casino operator unlawfully interrogated
employees, threatened reprimands, and suspended and discharged three employees for
engaging in unprotected activity (Hartman and Tyner, Inc dba Mardi Gras Casino and
Hollywood Concessions, Inc, April 25, 2013). The discharge of one employee just days
after she was coercively interrogated about her union activity showed that such activity
was a substantial and motivating factor in the decision to discharge her. Further, the
Board found that the two other discharged employees were engaged in protected activity
when they requested the contact information of coworkers in order to discuss the union
away from the casino.
Knowledge of union activity. With respect to the first employee, the Board agreed with
an administrative law judge that the Acting General Counsel met his initial Wright Line
burden of showing that the employee’s union activity was a substantial and motivating
factor in the employer’s decision to discharge her. Here, the Board determined that there
was no merit to the employer’s assertion that the Acting General Counsel did not
establish that it had knowledge of the employer’s union activity. In fact, the employer
coercively interrogated the employee about her union activities and sympathies just four
days before it discharged her. This interrogation demonstrated that the employer knew, or
at least suspected, that she supported the union.
Additionally, a couple of days before her discharge, the employer’s beverage manager
told the employee that he heard she was getting herself into trouble. Coming on the eve
of the employee’s discharge, the Board found that the comment was a veiled reference to
her union activity and further demonstrated the employer’s knowledge. Finally, the
reasons the employer gave for her discharge were false. Knowledge of union activities
can be inferred from the pretextual reasons given for adverse personnel actions. Thus, the
Board had little trouble inferring that the employer had knowledge of the employee’s
union activity when it discharged her. Because the employer did not show that it would
have discharged the employee absent her union activity, the Board found that the
discharge was unlawful.
Organizing efforts. With respect to the remaining two discharged employees, the record
fully supported the law judge’s findings that the justifications given by the employer for
their discharges were false. Consequently, the Board adopted those portions of his
decision. One of the employees was allegedly discharged after a female coworker
complained that he requested her cell phone number and asked for her address to meet
with her. A second woman reported that he asked her about how she liked working at the
casino. The Board rejected the employer’s argument that the employees were lawfully
discharged because they harassed and bothered coworkers. Rather, the ALJ found that the
first employee left both women alone after being requested to do so.
35
Coworker contact information. The second employee was discharged based on an
exchange with a coworker where he informed that individual of the union organizing
campaign and asked if they could exchange phone numbers so they could speak outside
work. Although this exchange took less than a minute, later that day the employee was
advised that he was being discharged because he interfered with the work of another
employee. Here, the Board observed that there was no evidence that the employer
restricted employees from talking to each other while working. Moreover, the ALJ found
that employees regularly spoke about other nonwork subjects during working time, and
there was no evidence that the employer prohibited employees from requesting their
coworkers’ contact information or from arranging meetings outside of work.
Even if the employer had a rule that prohibited such discussions, the employees’ activity
fit squarely within the range of activity protected by Sec. 7. Both employees were
members of the union’s organizing committee who requested their coworkers’ contact
information in order to discuss the union outside of the workplace. The Board noted that
employees are protected in requesting information that is relevant to organizational
purposes.
The slip opinion number is 359 NLRB No 100.
Attorneys: Susy Kucera for NLRB General Counsel. Robert Norton (Allen Norton &
Blue) for Employer. Michael Hill (Sugarman & Susskind) for Union.
NLRB: Board deferral to arbitration award reinstating employee without back pay
and seniority appropriate
By Ronald Miller, J.D.
An administrative law judge appropriately dismissed an unfair labor practice complaint
filed by a union on behalf of an employee discharged for distributing a union flyer in a
work area of a hospital on work time, after finding that deferral to an arbitration award
was appropriate under Spielberg Mfg Co and Olin Corp, ruled a three-member panel of
the NLRB (Shands Jacksonville Medical Center, Inc, April 26, 2013). Because the
employee lied under oath at the arbitration hearing, the arbitrator could appropriately
deny her back pay for such conduct, so that the arbitration award, ordering the
employee’s reinstatement without back pay and credit for time lost, was not repugnant to
the Act.
This case arose out of the hospital’s discharge of the employee for distributing a union
flyer in a work area on work time. Her union filed a grievance challenging the proprietary
of her discharge under the parties’ collective bargaining agreement. The grievance
culminated in an arbitration proceeding which examined the circumstances surrounding
the employee’s distribution of the flyer, the employer’s subsequent investigation and its
proferred reason for the employee’s discharge. Ultimately, the arbitrator issued an award
in which he found that the employee’s discharge was not for good cause and ordered her
reinstatement. However, the arbitrator denied the employee back pay, and credit for time
lost for seniority, vacation, and sick leave purposes because the employee lied to the
36
employer during the investigation of her conduct and to the arbitrator under oath at the
arbitration hearing.
Meanwhile, the union filed an unfair labor practice charge regarding the employee’s
discharge with the NLRB. A complaint was issued alleging that the employee’s discharge
was unlawful under the NLRA. However, the ALJ dismissed the complaint after finding
deferral was appropriate.
Deferral to arbitration. The Board defers to an arbitration award when the arbitration
proceedings appear to have been fair and regular, all parties had agreed to be bound, the
arbitrator adequately considered the unfair labor practice issue that the Board is called on
to decide, and the decision of the arbitrator is not clearly repugnant to the purposes and
policies of the Act.
Here, neither party contended that the arbitration proceedings were not fair and regular or
that any party did not agree to be bound by the arbitrator’s award. Moreover, the NLRB
found that the contractual issue, whether the employer had good cause to terminate the
employee, was factually parallel to the statutory issue, whether the employer terminated
the employee because of her union activity. Also, the arbitrator was presented generally
with the facts relevant to resolving the unfair labor practice. Consequently, the only
question remaining was whether the award, ordering the employee reinstated without
back pay and credit for time lost, was clearly repugnant to the NLRA.
As a general matter, the mere fact that an arbitration award is not coextensive with the
Board’s usual remedies does not, without more, make the award clearly repugnant to the
NLRA. Specifically, an award that reinstates an employee without full back pay and
accrued benefits is not necessarily inconsistent with the Act. In this instance, the
arbitrator premised his denial of back pay on two separate grounds: first, the employee
lied to the employer during its investigation of her conduct; and, second, the employee
lied under oath at the arbitration hearing. Arguably, the employee’s lie to the employer
was protected because it was related to a protected right guaranteed by the Act, that she
was not obligated to disclose. On the other hand, her lie at the arbitration hearing was not
protected, and the arbitrator could appropriately deny her back pay for that conduct.
Because the arbitrator’s award could be interpreted in a way consistent with the NLRA,
his denial of back pay and credit for time lost did not make the award repugnant to the
Act.
The slip opinion number is 359 NLRB 104.
Attorneys: Rafael Aybar, for Acting General Counsel. Charles P. Roberts, III (Constangy
Brooks & Smith) for Employer. Alma R. Gonzalez, AFSCME Florida Council 79, for
Unions.
37
ALJ finds two out of three electronic media use policies overly restrictive of Section
7 rights
By Joy P. Waltemath, J.D.
Two out of three of a health care employer’s computer use policies governing email and
electronic media were found overbroad by an NLRB Administrative Law Judge because
they could chill employees’ Sec. 7 rights. Although the ALJ found the solicitation policy
lawful because it prohibited the use of email for all nonwork solicitations, the electronic
mail and messaging policy and the acceptable use of IT resources policy both were
facially overbroad and ambiguous for, among other reasons, requiring some type of
management approval for certain nonwork uses.
Solicitation policy. UPMC’s solicitation policy prohibited the use of email for all
nonwork solicitations, period. Other nonwork use of the email system was not barred;
rather, the line was drawn based on solicitation/nonsolicitation generally, not on Sec. 7
lines, the ALJ noted. Accordingly, under Register-Guard, the solicitation policy was
lawful because it barred no Sec. 7 activity that the Board has found takes precedence over
an employer’s assertion of a property right to bar generally nonwork solicitation. Further,
given that, the ALJ found it also was not unlawful for the policy to require employees to
report violations.
Electronic mail and messaging policy. In contrast to the no-solicitation email policy,
the email and messaging policy itself did not bar all employee nonwork use of email, but
only some nonwork use of email, which is what created the problem for the ALJ.
Nonwork email usage was allowed under the policy unless it might be “disruptive,” or
“offensive,” or “harmful to morale.” Further, under this policy, solicitation was barred
only if it sought to have employees “support any group or organization,” and even that
was permitted if it were “sanctioned by UPMC executive management.” Additionally,
there were no illustrations or guidance provided that would assist an employee in
interpreting these terms. It was clear to the ALJ that these terms would reasonably be
understood to include communication about unions and criticism of UPMC’s working
conditions while permitting widespread nonwork use of the email system for an array
other subjects. As such, the policy failed to define the area of permissible conduct in a
manner clear to employees and caused employees to refrain from engaging in protected
activities.
Independently, the electronic mail and messaging policy’s ban on solicitation that sought
to have employees “support any group or organization, unless sanctioned by UPMC
executive management,” also violated the NLRA. This was not a rule barring use of an
employer’s email system for nonwork matters, including Sec. 7 solicitation, nor was it a
rule barring solicitation in support of any group or organization. By requiring permission
from UPMC executive management, said the ALJ, the rule “invites reasonable employees
to believe that Sec. 7 activity is prohibited without prior management permission.”
Employees wanting to use email for Sec. 7 purposes were required to disclose this to and
seek permission from management, and the chilling effect was unavoidable.
38
Acceptable use of IT resources policy. UPMC’s acceptable use of IT resources policy
established a broad restriction on the use of UPMC’s information technology for
“business, clinical, research, and educational activities of UPMC workforce members.”
However, the policy stated an exception in the event a UPMC technology resource was
assigned to an employee; then, the employee was permitted de minimis personal use of
that resource. The policy expressly defined “de minimis personal use” as use that neither
affected the employee’s job performance nor prevented other employees from performing
their job duties.
UPMC argued that read in context, this policy was exclusively intended to govern
communications that could reasonably be construed as being made on its behalf,
suggesting also that it only restricted employees’ use of UPMC equipment and activities
at work. Although agreeing that the policy addressed use of UPMC IT resources—not
employees’ own computers and technology—the ALJ did not find that the policy could
only be read to cover communications purportedly made on behalf of UPMC. More
troubling, however, was the “de minimis personal use” issue, which almost by definition
is use of the computer systems not made by employees on behalf of UPMC.
Read in context, the ALJ interpreted the policy to mean that employees were allowed to
use computers for nonwork purposes to the extent it did not interfere with job duties, and
employees could even use these resources for social media communication well beyond
communicating with others using UPMC equipment. By implication the policy permitted
employees to use UPMC equipment for Facebook, Twitter, and other such sites, as long
as employees did not describe any affiliation with UPMC, did not “disparage or
misrepresent” UPMC, make “false or misleading statements regarding UPMC,” or use
UPMC logos or other copyrighted or trademarked materials. But employees could make
statements and communications that fell within the scope of these restricted areas if
written prior consent were obtained from UPMC.
Using the same rationale he had for the email and messaging policy, the ALJ found these
restrictive provisions, which employees could avoid if they sought and received
permission from the employer, unlawfully overbroad and vague. Nothing in UPMC’s rule
indicated that any protected activity was exempt from the rule, and as such, the rule on its
face impermissibly chilled Sec. 7 activity. To be acceptable, the rule would need to
explain which protected conduct was permitted and which was not.
Specifically, the restriction on describing any affiliation with UPMC could be reasonably
read to prohibit employees on Facebook, Twitter, etc., from telling anyone where they
work, which would severely inhibit any discussion of terms and conditions of their
employment. That portion prohibiting the use of UPMC logos (and other trademarked or
copyrighted materials) by employees when they posted on social media sites, for
example, was also too broad. Employees have a Sec. 7 right to display a logo as part of
their Sec. 7 communications, the ALJ pointed out. Moreover, the acceptable use policy
made it clear that its limitations—on disparaging, misrepresenting, making false or
misleading statements, or using UPMC logos—could be avoided if employees received
prior written permission from UPMC, a requirement that the ALJ found antithetical to
39
employees’ Sec. 7 rights. Finally, because the IT policy required employees to get written
approval before transferring “sensitive, confidential, and highly confidential information”
over the Internet, which was defined to include compensation data, benefits data, and
coworker data, among other things, the policy would reasonably chill protected employee
discussion such as on wages, personnel matters, benefits and other terms and conditions
of employment.
UPMC, April 19, 2013 (released April 23, 2013); the case number is 06–CA–081896.
Janice A. Sauchin, for Acting General Counsel. Mark Stubley (Ogletree Deakins) for
Employer.
TexSCt: Texas Labor Code does not confer right on public employees to union
representative when investigatory interview may result in disciplinary action
By Ronald Miller, J.D.
Section 101.001 of the Texas Labor Code does not confer on public employees the right
to union representation when an employee reasonably believes that an investigatory
interview may result in disciplinary action, ruled a divided Texas Supreme Court (City of
Round Rock, Texas v Rodriguez, April 5, 2013, Green, P). Despite the broad language of
the statute, the majority declined to read it as conferring Weingarten rights to public
employees in Texas to have a union representative present at an investigatory interview
an employee reasonably believes might result in disciplinary action. Chief Justice
Jefferson, joined by Justices Hecht and Lehrmann, dissented.
Representation at interview. In July 2008, the fire chief called a firefighter into his
office for a meeting. The chief was joined by an assistant chief and a battalion chief. The
employee was told that the purpose of the meeting was to conduct an internal interview
regarding a personnel complaint filed against him. Specifically, the chief alleged that the
employee had misused his sick leave earlier that month to get a physical to pursue
employment with another fire department. The complaint denied the employee
representation at the meeting but stated that if a pre-disciplinary meeting resulted then he
would be eligible for representation at that time. The complaint also prohibited the
employee from discussing the complaint with anyone other than his attorney.
Before the interview began, the employee asserted his right to union representation, but
his request for a union representative was denied and the chief conducted the interview
without representation. Thereafter, the chief met again with the employee to discuss
potential discipline for the conduct alleged in the complaint. The employee did not ask
for representation in this meeting. He subsequently accepted a five-day suspension
without a right of appeal. Three months later, the employee and his union filed a
declaratory judgment action alleging that the city violated his right to union
representation under Sec. 101.001 of the Texas Labor Code, and sought to enjoin the
chief and city from denying the employee and other fire fighters their right to
representation at future investigatory interviews. The trial court granted summary
40
judgment in favor of the employee and union. After the court of appeals affirmed, this
appeal ensued.
The Texas high court reversed the judgment of the court of appeals and ruled that section
101.001 of the Labor Code does not confer on public-sector employees in Texas the right
to union representation at an investigatory interview that the employee reasonably
believes might result in disciplinary action. Although private-sector employees and
federal public-sector employees both possess such a representation right, the majority
held that the Texas Legislature has not granted that right to public-sector employees in
Texas.
Weingarten rights. The right to union representation in an investigatory interview
derives from the United States Supreme Court’s decision in NLRB v Weingarten.
Following Weingarten, Congress extended the representation right to federal publicsector employees, 5 USC Sec. 7101(b). Thus, the right to union representation during
investigatory interviews currently applies nationally to all private-sector employees and
federal public-sector employees.
The Texas Supreme court analyzed the text of Sec. 101.001 to determine whether the
legislature had the intention to confer Weingarten rights on public employees in Texas.
While the statute is broad, the state high court did not read it as conferring, by its plain
language, the specific right to have a union representative present at an investigatory
interview that an employee reasonably believes might result in disciplinary action. By its
plain terms, the statute makes it lawful for employees to form labor unions or other
organizations, and specifically, those organizations created to protect them in their
employment. It says nothing about any rights that may attach once such unions are
formed.
Public sector scheme. This reading of section 101.001 comports with other labor-related
provisions in the Texas statutes that are premised on section 101.001’s right to form
unions. While section 101.001protects the right of employees to organize into labor
unions, section 101.052 of the Labor Code protects the “right to work.” The court
observed that it has recognized that the “intent of the right-to-work statute seems obvious
to protect employees in the exercise of the right of free choice of joining or not joining a
union.” Moreover, the court declared that its construction of Sec. 101.001 — as
conferring the right to organize into unions — is in accord with Chapter 617 of the Texas
Government Code, which defines specific rights of Texas public-sector labor unions.
While Chapter 617 confers the right to present grievances, it does not confer the right to
union representation during investigatory interviews.
The court also observed that Sec. 7 of the NLRA differs significantly from Sec. 101.001.
Section 7 confers four rights that union members can invoke for their protection: (1)
“self-organization”; (2) “form, join, or assist labor organizations”; (3) “bargain
collectively through representatives of their own choosing”; and (4) “engage in other
concerted activities for the purpose of collective bargaining or other mutual aid or
protection.” The Weingarten right recognized by the Supreme Court is rooted in that
41
fourth right. Without similar “concerted activities” language, the Texas court determined
that it could not find a representation right in section 101.001. In the 38 years since
Weingarten was decided, the Texas Legislature has declined to enact legislation to confer
the right to union representation on Texas public sector employees during investigatory
interviews.
Dissent. Chief Justice Jefferson issued a separate dissenting opinion joined by Justices
Hecht and Lehrmann. The dissent observed that it was clear at the time Sec. 101.001 was
enacted that the legislature was aware of the right to union representation when it granted
employees the ability “to associate themselves together and form trade unions and other
organizations for the purpose of protecting themselves in their personal work.” He argued
that the majority’s decision would eliminate the “representation right’ of a Texas public
sector employee to have a union representative accompany him when his employer
conducts an interview that foreshadows disciplinary action, which they have exercised for
decades. Consequently, he dissented from the majority opinion.
The case number is 10-0666.
Attorneys: B. Craig Deats (Deats Durst Owen & Levy) for Employee. Anna M. Baker
(Alexander Dubose Jones & Townsend) for Employer.
Hot Topics in WAGES HOURS & FMLA:
USSCt: Once individual claim rendered moot because of offer of judgment, named
plaintiff could not continue representing class in FLSA collective action
By Ronald Miller, J.D.
After an employee’s individual claim under the FLSA was rendered moot after she
ignored an employer’s offer of judgment under FRCP 68 that fully satisfied her claim,
she no longer had a personal interest in representing the putative, unnamed claimants, so
her FLSA collective action suit was appropriately dismissed for lack of subject matter
jurisdiction, ruled a divided U.S. Supreme Court in a 5-4 decision (Genesis Healthcare
Corp v Symczyk, April 16, 2013, Thomas, C). Justice Kagan filed a dissenting opinion in
which Justices Ginsberg, Breyer and Sotomayor joined.
The employee, a registered nurse at a health care center, brought an FLSA collective
action alleging that her former employer violated the Act by automatically deducting 30
minutes per shift for meal breaks, even when the employee performed compensable work
during those breaks. Throughout the proceedings, she remained the sole plaintiff. When
the employer answered the complaint, it simultaneously served upon the plaintiff an offer
of judgment under Rule 68. The offer included $7,500 for alleged unpaid wages, in
addition to reasonable attorneys’ fees, costs, and expenses. After the employee failed to
respond within the allotted time period, the employer filed a motion to dismiss for lack of
subject-matter jurisdiction.
42
Personal stake. The employer argued that because it offered the employee complete
relief on her individual damages claim, she no longer possessed a personal stake in the
outcome of the suit, rendering the action moot. On the other hand, the employee argued
that the employer was attempting to “pick off” the named plaintiff before the collective
action process could unfold. The district court agreed with the employer, finding that
because no other individuals had joined the suit and that the Rule 68 offer of judgment
fully satisfied her individual claim, the suit was moot and so it dismissed the action for
lack of subject matter jurisdiction.
On appeal to the Third Circuit, the district court judgment was reversed. While the
appeals court agreed that the employee’s individual claim was moot, it nevertheless held
that the collective action was not, explaining that allowing the employer to “pick off”
named plaintiffs before certification with calculated Rule 68 offers would frustrate the
goals of collective actions. The appeals court determined that the case must be remanded
in order to allow the employee to seek “conditional certification.”
Justiciable claim. Before the Supreme Court, the employee now challenged the rulings
by the courts below that the offer of judgment mooted her FLSA claim. However, the
High Court determined that because the employee conceded that her individual claim was
moot, and she did not properly raise the issue here, it assumed that the offer of judgment
mooted the individual claim. Thus, the question remaining before the Supreme Court was
whether the employee’s FLSA collective action remained justiciable.
Here, the majority concluded that in the absence of any claimants opting in, the collective
action became moot when the employee’s individual claim became moot because she
lacked any personal interest in representing others in this action. The mere presence of
collective action allegations in the complaint was not enough to save the suit from
mootness once the individual claim was satisfied. Moreover, the employee could not rely
on cases arising in the Rule 23 context to avoid this result. Further, the Court rejected the
employer’s argument that the purposes served by the FLSA’s collective action provisions
would be frustrated by the employer’s use of Rule 68 to “pick off” named plaintiffs
before the collective action process has run its course. Thus, the majority concluded that
this action was appropriately dismissed as moot.
Dissent. In dissent, Justice Kagan pointed out that Rule 68 precludes a court from
imposing judgment based on an unaccepted settlement offer made pursuant to its terms.
The text of the rule contemplates that a court will enter judgment only when a plaintiff
accepts an offer. Additionally, the rule prohibits a court from considering an unaccepted
offer for any purpose other than allocating litigation costs — including for the purpose of
entering judgment for either party. That injunction accords with the exclusive purpose of
Rule 68, declared the dissent, to promote voluntary cessation of litigation by imposing
costs on plaintiffs who spurn certain settlement offers. Thus, the dissent argued that Rule
68 does not provide a mechanism for a court to terminate a lawsuit without the plaintiff’s
consent. It is the plaintiff’s choice, not the defendant’s or the court’s, whether satisfaction
of her individual claim, without redress of her viable classwide allegations, is sufficient
to bring a lawsuit to an end.
43
The case number is 11-1059.
Attorneys: Ronald J. Mann, Columbia Law School, for Employer. Gary F. Lynch
(Carlson Lynch) for Employee.
Bill allowing “comp time” to be introduced into House
Representative Martha Roby (R-Ala) plans to introduce the Working Families Flexibility
Act next week. According to information from Roby, the legislation would give private
sector employees more options for using their time and also eliminate a government
regulation that prohibits employers from offering "comp time" to their employees.
“Today’s workplace has changed, and so has the modern worker. We have different
demands on our time, and it only makes sense that our laws catch up to the realities of
today's workplace and today’s families. Getting paid ‘time and a half’ for earned
overtime is a fundamental workplace right that won't change. However, for some
workers, having extra paid time off is actually more valuable than money,” said Roby in
a statement.
“My bill would give private sector employers the option to offer paid ‘time and a half’ off
work, or ‘comp time,’ to employees,” she added. “No worker could ever be forced to take
paid time off, just like no business would be forced to offer it. The same protections that
have been a part of labor law for decades would remain, including the guarantees of the
40-hour work week. But for some workers and some businesses, this can be a valuable
option to include in a benefits package,” Roby said.
Senators want DOL to further review proposed rule regarding “companionship
exemption”
U.S. Senators Lamar Alexander (R-Tenn), Richard Burr (R-NC), Mike Johanns (R-Neb),
Tom Coburn (R-Okla), and John Cornyn (R-Texas) today urged the administration to
reexamine its plan to raise the cost of in-home companion care and perform “a more
accurate analysis” to determine the “the actual cost that the proposed rule would have on
recipients and caregivers.”
In a letter to Boris Bershteyn, the acting administrator for the Office of Information and
Regulatory Affairs at the Office of Management and Budget, the senators ask that the
agency return to the Department of Labor for further review and analysis a proposed rule
to essentially eliminate a current regulation, known as the “companionship exemption,”
which has exempted companionship services and live-in domestic services from overtime
requirements under the Fair Labor Standards Act since 1975.
The senators wrote, in part, “Current law is a reflection of the will of Congress to protect
both the interests of elderly and disabled care recipients who need affordable care along
with those of caregivers who want predictable employment arrangements. …The
imposition of an FLSA regulatory regime will not only undermine care but it will result
44
in employment instability for caregivers who have long been able to take advantage of
the mutually beneficial arrangements that the companionship exemption allows.”
According to statement from the Senate Health Education and Labor and Pensions
committee, in May 2012, Senators Johanns and Alexander introduced, along with 11
other senators, the Companionship Exemption Protection Act.
“Comp time” legislation introduced in House
On April 9, Representative Martha Roby (R-AL) introduced the Working Families
Flexibility Act of 2013. HR 1406 would allow private-sector workers to receive paid time
off or “comp time” for overtime hours worked. However, employees who want to receive
cash wages would continue to do so. No employee could be forced to take comp time
instead of receiving overtime pay under the Act.
According to information from the House Committee on Education & the Workforce, the
legislation would protect employees by requiring the employer and the employee to
complete a written agreement to use comp time, entered into knowingly and voluntarily
by the employee. Where the employee is represented by a union, the agreement to take
comp time must be part of the collective bargaining agreement negotiated between the
union and the employer.
Additionally, the legislation would retain all existing employee protections in current
law, including the 40-hour work week and how overtime compensation is accrued. The
bill would add additional safeguards for workers to ensure that the choice and use of
comp time are truly voluntary. Moreover, the legislation would permit employees to
accrue up to 160 hours of comp time each year. An employer would be required to pay
cash wages for any unused time at the end of the year. Workers would be free to ‘cash
out’ their accrued comp time whenever they choose to do so.
“I often meet working moms and dads who say they need more time to spend with family
or to take care of responsibilities outside of work,” said Roby. “But right now the law
prohibits private businesses from offering comp time options for their employees, even
though it is legal in the public sector. Washington shouldn't stand in the way of an
employer and an employee coming to a ‘comp time’ agreement that each is happy with.
As a working mom myself, I’m proud to carry legislation that will empower employees
with more freedom to control their overtime compensation so they can budget more time
to spend with their families.”
Representative Tim Walberg (R-MI), chairman of the Subcommittee on Workforce
Protections and original cosponsor of the bill, will chair a legislative hearing on
Thursday, April 11 at 10:00 am to discuss the proposal. The hearing will take place in
room 2175 of the Rayburn House Office Building.
House committee passes “comp time” legislation
45
The House Committee on Education and the Workforce, chaired by Representative John
Kline (R-MN), approved on April 17 the Working Families Flexibility Act of 2013 (HR
1406) by a vote of 23 to 14.
“Today we've taken an important step toward providing workers the flexibility they need
to better balance the needs of family and work,” said Chairman Kline in a statement
released by the House committee. “An outdated federal policy shouldn't deny workers the
chance to spend more time with their children, attend parent-teacher conferences, or care
for an aging relative. This is a commonsense proposal that is desperately needed in
today's workplaces. I want to thank Representative Roby for championing this important
legislation and I look forward to a floor debate in the House as soon as possible.”
“Denying private businesses and workers a benefit government employees already
receive is highly hypocritical,” said Representative Martha Roby (R-AL), who introduced
the legislation. “It is also unfair. For some workers, having extra paid time off is actually
more valuable than money. And, if that’s the case, why should Washington stand in the
way? The Working Families Flexibility Act would finally offer working Americans in the
private-sector what their peers in the public-sector already enjoy — more freedom and
more control over their time so they can spend it the way they choose.”
According to a statement by the committee, HR 1406 as approved will:




Allow employers to offer employees a choice between cash wages and comp time
for overtime hours worked. Employees who want to receive cash wages would
continue to do so. No employee can be forced to take comp time instead of
receiving overtime pay.
Protect employees by requiring the employer and the employee to complete a
written agreement to use comp time, entered into knowingly and voluntarily by
the employee. Where the employee is represented by a union, the agreement to
take comp time must be part of the collective bargaining agreement negotiated
between the union and the employer.
Retain all existing employee protections in current law, including the 40-hour
work week and how overtime compensation is accrued. The bill adds additional
safeguards for workers to ensure the choice and use of comp time are truly
voluntary.
Allow employees to accrue up to 160 hours of comp time each year. An employer
would be required to pay cash wages for any unused time at the end of the year.
Workers are free to ‘cash out’ their accrued comp time whenever they choose to
do so.
White House releases proposed budget for 2014
By Pamela Wolf, J.D.
46
President Barack Obama has released his proposed budget for fiscal year (FY) 2014. In
keeping with several other administrations, the budget request is late. It was required to
be submitted before the first Monday in February. The House and the Senate will now
develop appropriations bills to fund specific government programs.
EEOC. The president’s budget request for the EEOC is $372,923,000 — about $10
million more than allocated under the 2013 Continuing Appropriations Resolution (CR)
($362 million) and some $12 million more than the FY 2012 actual budget ($360
million). The FY 2014 request for the agency includes up to $29,500,000 for payments to
state and local enforcement agencies. The priority for EEOC resources “continues to be
litigating systemic cases and maintaining a manageable inventory of cases,” according to
the budget proposal. The FY 2014 budget request projects employment of 2,239 fulltime
equivalents (FTE) at the EEOC, as compared to 2,212 FTEs under the CR and 2,332
FTEs in the FY 2012 actual budget.
DOL. According to a DOL press release, the president's budget request includes $12.1
billion in discretionary funding for the agency, including its many sub-agencies that
regulate labor. The DOL points to the following highlights in the FY 2014 budget
request:






An additional $5.8 million for Mine Safety and Health Administration
enforcement programs to pursue strategies that prevent death, disease and injury
from mining, and $2.5 million to implement recommendations from the internal
review conducted in the wake of the Upper Big Branch Mine disaster.
An additional $5.9 million to bolster the Occupational Safety and Health
Administration's enforcement of the numerous laws that protect workers and
others from retaliation for reporting unsafe and unscrupulous practices.
Nearly $14 million to combat the misclassification of workers as independent
contractors, which deprives workers of benefits and protections to which they are
legally entitled and puts law-abiding businesses at a disadvantage against
employers who violate the law.
An additional $3.4 million for the Wage and Hour Division to support greater
enforcement of the Fair Labor Standards Act and the Family and Medical Leave
Act.
$5 million for the creation of a State Paid Leave Fund to assist workers who need
to take time off to care for a child or other family member.
An initiative to encourage companies to fully fund their pension benefits by
authorizing the Pension Benefit Guaranty Corp. board to adjust premiums and
take into account the risks that different retirement plan sponsors pose to their
retirees. Under the initiative, the PBGC is estimated to save $25 billion over the
next decade.
47
WHD. For necessary expenses of the DOL’s Wage and Hour Division, including
reimbursement to state, federal, and local agencies and their employees for inspection
services rendered, the president’s proposed budget requests $243,254,000. The request
represents about a $14 million dollar increase from the $229 million available under the
CR, and approximately $17 million more than the $226 million available in the FY 2012
actual budget. The proposed budget projects a staffing increase of 63 FTEs to a total of
1,573, as compared to 1,510 under both the CR and the FY 2012 actual budget.
According to the proposed budget, approximately 265,000 persons are expected to be
aided under the FLSA in 2014 by securing agreements with firms to pay back wages
owed to workers. About 25,000 persons will be aided in government contract compliance
actions by securing agreements to pay wages owed to workers.
OFCCP. President Obama is requesting $108,467,000 for the DOL’s OFCCP —
approximately $2 million more than the $106 million allocated under the CR and about
$3 million above the FY 2012 actual budget. The OFCCP expects to complete 4,650
compliance evaluations in 2014, with a focus on both supply and service construction
reviews, according to the proposed budget. The agency will also “continue to shift its
outreach strategy from being contractor-centric to worker-focused, which will strengthen
its enforcement capacity in the process.” Additionally, the OFCCP intends “to ensure that
contractors and subcontractors are provided linkages to recruitment sources for hiring and
advancement of minorities, women, protected veterans, and individuals with disabilities.”
The agency will increase its staff by 10 FTE to a total of 753, as compared to 743 under
the CR and the FY 2012 actual budget.
OSHA. Some $570,519,000 is allocated to the DOL’s OSHA under the president’s
proposed budget. The agency will increase staffing in 2014 to 2,255, up from 2,239 under
the CR and the FY 2012 actual budget.
Budget justifications. The EEOC has already posted its Congressional Budget
Justification, which states that the proposed budget will enable the agency “to focus on
serving the public more efficiently, addressing both enduring and emerging
discriminatory practices in the workplace, and enforcing the law more effectively with
the full array of tools available to address workplace discrimination and advance equal
employment opportunity in the 21st century.”
DOL obtains consent judgment in excess of $35 million in back wages
A federal district court in Puerto Rico entered a consent judgment whereby the
Commonwealth of Puerto Rico agreed to pay more than $35 million in back wages and
interest to 4,490 current and former employees of the territory's Department of
Corrections and Rehabilitation. The agreement followed an investigation by the U.S.
DOL’s Wage and Hour Division that found violations of the FLSA overtime and recordkeeping provisions. According to the DOL, this represents one of the largest settlements
in the WHD’s history.
In addition to the monetary settlement, the Commonwealth and DCR also agreed to take
“significant steps to ensure future compliance with the law.” For example, the employers
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will install an electronic timekeeping system at the facilities, train supervisors in the use
of the new system, hire additional staff to reduce the need for overtime, and adjust daily
tours of duty for guards. The consent judgment also provides for certain injunctive relief
and spells out requirements for wage statements to be provided to employees.
According to the DOL, the commonwealth government already has restored more than
$15 million in back wages due to employees for overtime hours worked since November
2011. The remaining back wages will be paid on an installment basis and distributed to
current and former employees as scheduled through 2016.
“We are pleased that the commonwealth of Puerto Rico has been our partner, through a
long and arduous process, in correcting the improper payment of back wages,” said
acting Secretary of Labor Seth D. Harris. “This agreement returns hard-earned wages to
workers and underscores the U.S. Department of Labor's commitment to ensuring that
workers receive the wages they earn, as mandated by federal law.”
Employer required to offer reinstatement, make back pay and reimbursement of
medical expenses under consent judgment in FMLA case
Under a consent judgment ordered by a federal district court in Arizona, a delivery driver
must be offered reinstatement and will receive back pay and reimbursement of medical
expenses under the FMLA.
Initially, the DOL’s Wage and Hour Division conducted an investigation and found that
DS Waters of America Inc discriminated against the driver when it failed to reinstate him
at the end of an approved FMLA-covered leave period. The Atlanta, Georgia-based
employer, doing business as Sparkletts, acquired Mesa, Arizona-based O Premium
Waters shortly after the employee began the leave. The DOL’s investigation determined
that Sparkletts, as the successor company, had a legal obligation to allow the employee to
complete his leave and then restore him to an equivalent position as required by the Act.
In the course of its investigation, the Department determined that at the time of the
acquisition, Sparkletts hired approximately 87 percent of O Premium Waters' drivers at
the Mesa location but excluded the driver who was on approved medical leave.
Sparkletts' refusal to rehire the employee and continue the employment benefits he had as
an employee of O Premium Waters, including medical, dental and vision insurance for
him and his family, violated the law, according to the DOL. Accordingly, the agency
filed suit against the employer.
To resolve the violations, the company has been required to make an offer of
employment with full seniority credit and reimburse the worker $31,464 in out-of-pocket
medical expenses, in addition to paying him $26,871 in back wages.
“Twenty years ago, the FMLA codified a simple and fundamental principle in this
country: Workers should not have to choose between the job they need and the family
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members they love and who need their care,” said acting Secretary of Labor Seth D.
Harris. “Employers must abide by this principle in both their policies and practices.”
“This case is a real victory for workers and families seeking justice against unlawful
employment practices,” added Mary Beth Maxwell, the WHD’s Acting Deputy
Administrator. “An employee was suddenly left without a job, paycheck or medical
benefits when the company changed hands. He and his family suffered emotional and
financial stress at a time when they could least afford it.”
Regional offices announce backpay recovered in wage-hour enforcement actions
The Wage Hour Division’s regional offices in recent days have announced relief obtained
by the agency in a number of enforcement actions and other developments in ongoing
investigations:
Gravel truck drivers receive back pay. As a result of one of several recent enforcement
actions by the Wage-Hour Division, 16 gravel truck drivers employed at Porter Ready
Mix Inc have been paid a total of $173,863 in overtime back wages after an investigation
by the division revealed that the drivers were paid on a per-trip basis and were not
compensated at time and one-half their regular rates of pay for hours worked over 40 in a
workweek. Additionally, the company’s records did not accurately reflect weekly hours
worked and the overtime wages due for some employees.
“Paying employees on a piece-rate basis does not absolve an employer of its
responsibility to pay overtime,” said Cynthia Watson, regional administrator for the
Wage and Hour Division in the Southwest. “Porter Ready Mix failed to ensure that its
per-trip pay practices were consistent with the FLSA’s overtime requirements. As a
result, hard working truck drivers were deprived of more than $173,000—wages that
should have been in their pockets all along. This case should remind other construction
industry employers to examine their own payroll practices and ensure that they are
paying their employees in compliance with the law.”
Child labor investigation. The DOL filed subpoena enforcement actions against
Paragon Contractors Corp, Brian Jessop, Dale Barlow, and Keith Dutson for improperly
withholding or refusing to provide information in an ongoing child labor investigation
stemming from the alleged involvement of hundreds of children in pecan harvesting
operations in December 2012. Although some subpoenaed information has been
produced, the Wage and Hour Division has reason to believe that Paragon, Jessop, and
Barlow have either improperly withheld or refused to provide information critical to its
investigation. Additionally, Dutson has refused to appear for subpoenaed testimony.
The department has already reached an agreement with Southern Utah Pecan Ranch Ltd.,
a Nevada limited liability company, to ensure that its labor contractors are compliant with
federal labor laws. The agreement further requires the company to pay up to the full value
of the pecans harvested on its property in late 2012 to satisfy any civil money penalties,
back wages, and liquidated damages assessed by the department as a result of its ongoing
child labor investigation. In addition, the grower is required to include language in future
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contracts that requires contractors to comply with federal and state laws by posting
informational posters on the ranch regarding labor laws and to hire a third party to
conduct annual audits evaluating its compliance with all the regulations for the next three
years.
While the alleged violations during the recent harvest at Southern Utah Pecan Ranch may
not violate Utah labor law, which exempts agricultural work from age limitations, federal
labor laws, including the FLSA, may still apply. When both state and federal youth
employment laws apply, the law setting the most protective standard must be observed.
The division previously cited and penalized Paragon Contractors Corp, as well as Brian
Jessop and James Jessop individually, for multiple child labor violations. The department
obtained a consent judgment and permanent injunction in federal court in 2007 to combat
future violations.
Davis-Bacon Act violations found. The DOL recovered $25,476 in back wages for ten
truck drivers who delivered construction materials for a federally funded highway project
near Chicago. An investigation by the Wage and Hour Division found that Allied
Landscaping Corp., which employed the drivers, violated provisions of the Davis-Bacon
Acts. The Joliet-based company is a subcontractor on an Illinois Department of
Transportation Project.
Wage and Hour Division investigators found truck drivers were paid $11 to $13 per hour
less than the required prevailing base wage rate in violation of the DBA. Under the terms
of a consent finding and settlement agreement approved by a DOL administrative law
judge, prime contractor Elwood-based Austin Tyler Construction LLC agreed to pay the
$25,476 in back wages.
Misclassified construction workers get back wages. Freeman & Associates Contracting
Corp in Raleigh, North Carolina, agreed to pay $20,088 in back wages to four
construction employees following a Wage Hour Division investigation that found the
employer misclassified employees as independent contractors and paid them straight-time
rates for overtime hours worked. The employer also failed to maintain accurate records of
employees’ work hours and wages as required by the FLSA. These employees had
worked for the contractor and had been considered employees until the employer changed
their status to independent contractors and illegally stopped paying overtime.
“Far too often employers misclassify their employees as independent contractors to avoid
paying them in compliance with the FLSA, as well as other federal, state and local
statutes,” said Richard Blaylock, director of the Wage and Hour Division’s Raleigh
District Office. “The Wage and Hour Division is vigorously pursuing corrective action in
those situations when workers are, in fact, employees to ensure that they are paid required
wages and to level the playing field for employers who play by the rules.”
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Dems introduce measure in both House, Senate to extend FMLA rights to same-sex
families
Rep. Carolyn B. Maloney (D-NY) and Sen. Richard Durbin (D-Ill) reintroduced the
Family and Medical Leave Inclusion Act (S. 846) on Thursday, April 25, a measure that
would allow employees to take unpaid leave to care for a same-sex spouse or partner,
parent-in-law, adult child, sibling, grandchild or grandparent.
“While groundbreaking at the time if its enactment, FMLA leaves a growing number of
families unable to take advantage of the benefits that it provides,” according to a
statement issued by the bill’s sponsors. Currently, employees are not permitted to take
FMLA leave to care for a same-sex spouse or partner. The same restrictions apply to
grandparents or adult children with serious health conditions, even if the employee is the
only person that can provide the care needed.
“Regardless of the make-up of one’s family, all employees should be given the same
rights to care for a sick loved one in a time of need,” Durbin said. “For 20 years, we have
had a law that provides unpaid leave for families in crisis. As families change, so should
the laws designed to help them.”
“There is a growing force in America and in Congress that supports same-sex marriage,
and yet our federal laws are failing to keep pace,” said Maloney. “FMLA provides almost
60 percent of the American workforce with leave protections but it is has been 20 years
since that law passed and it needs an upgrade.”
The legislation has the support of more than 80 employee rights, gay rights, and civil
rights groups. It has been introduced in the two previous sessions of Congress. Hundreds
of private employers already extend FMLA rights to employees in same-sex families,
Durbin noted in comments on the Senate floor.
LEADING CASE NEWS:
3rdCir: Multi-tiered compensation scheme did not convert salaried employee into
hourly paid employee entitled to overtime
By Ronald Miller, J.D.
Despite the multi-tiered nature of her compensation scheme, an employee was
nonetheless paid on a salaried basis and fell within an exemption from the FLSA’s
overtime compensation requirement, ruled the Third Circuit in an unpublished decision
(Sander v Light Action, Inc, April 26, 2013, Jordan, K). Here, the appeals court
determined that the employee was properly denied reconsideration of an order granting
summary judgment in favor of her employer on her overtime pay and retaliation claims.
The warehouse manager for a company specializing in theatrical lighting worked under a
compensation plan that entitled her to a guaranteed base pay of $60,000. She was
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expected to work 45 hours per week and could receive additional compensation for
working at events that occurred off-site, as well as for working overtime hours. The
employee’s weekly salary corresponded to her base pay. When she had off-site events,
however, her compensation was calculated by prorating her hours; she would be
compensated at a higher rate for hours spent at events. In May 2010, the employee
complained to management on at least one occasion about its leave policy and her level
of compensation. Later that month, she advised the employer that she was seeking legal
counsel regarding her compensation complaints. She was terminated following a
confrontation with her supervisors when she became belligerent and hostile during a
dispute over several work mishaps.
The employee subsequently brought this action alleging that she had not been paid
overtime as required by the FLSA. After discovery, both parties moved for summary
judgment. The employee sought partial summary judgment on her FLSA overtime claim,
while the employer sought summary judgment on all counts. Finding that there was no
genuine dispute that the employee was exempt from the FLSA’s overtime requirements
because she was a salaried employee and that she presented no evidence of unlawful
retaliation, the district court granted the employer’s motion. This appeal followed.
Exempt status. The appeals court first examined whether the employer’s practice of
prorating her hours undermined her exempt status. Individuals “employed in a bona fide
executive, administrative, or professional capacity” are exempt from the overtime
requirements of the FLSA. To fall within an exemption, the employee must be paid on a
salary or fee basis at a rate of not less than $455 per week, have a primary duty directly
related to the management or general business operations of the employer, and exercise
discretion and independent judgment. At issue in this appeal was the “salary basis”
component of the test.
Salary basis test. Contesting that she was paid on a salary basis, the employee countered
that the terms of her compensation package in fact paid her as an hourly employee and
thus she should have been paid one and one-half times her normal salary when she
worked more than 40 hours per week. The relevant federal regulation, 29 CFR Sec.
541.602(a), provides that an individual is paid on a salary basis if he or she regularly
receives a predetermined amount that is not subject to reduction because of variations in
the quality or quantity of the work performed. In other words, “the employee must
receive the full salary for any week in which the employee performs any work without
regard to the number of days or hours worked.”
Here, the employee contended that she was a non-exempt hourly employee because her
employer “docked” her hours when she worked outside the shop. Specifically, she
complained that by prorating her hours during weeks in which she had off-site events, the
employer improperly deducted money from the “predetermined amount” that she was
supposed to receive each pay period. However, the court disagreed. On weeks when she
did not have any shows, she was paid her standard weekly rate regardless of how many
hours she worked. Moreover, on weeks when she worked off-site, she earned even more.
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The reason that her hours were “prorated” during those weeks was not to deduct anything
from her base rate, but rather to ensure that she was paid a premium for the hours she
spent off-site. The multi-tiered nature of her compensation scheme did not change the
fact that the employee earned as part of her compensation package “a predetermined
amount … [that was] not subject to reduction.” Thus, the district court was correct to
conclude that there was no genuine dispute as to whether the plaintiff was a salaried
employee, and her claim to FLSA overtime compensation failed as a matter of law.
Retaliation claim. Moreover, the employee conceded that she did not have a viable
retaliation claim under a state law provision that prohibited discrimination on the basis of
disability where she provided no evidence that she was discriminated against on the basis
of a disability. The appeals court rejected her contention that the district court should
have treated the allegation as an FLSA retaliation claim, which was what she meant to
bring.
The case number is 12-2648.
Attorneys: Jeffrey K. Martin (Martin & Associates) for Employee. Margaret M. DiBianca
(Young, Conaway, Stargatt & Taylor) for Employer.
4thCir: Doctor’s note excusing only one day off for injury not notice of FMLAqualifying condition
By Joy P. Waltemath, J.D.
Regardless of the fact that an employee was still using crutches a week later, a doctor’s
note authorizing only one day’s absence for a cut foot was not legally adequate notice of
a serious health condition, the Fourth Circuit ruled in an unpublished opinion
(Brushwood v Wachovia Bank, NA, April 11, 2013, Duncan, A). Accordingly, when the
employee failed to return to work the next day and her employer terminated her for
excessive absences, it did not interfere with her FMLA-protected rights.
Here, the employer had granted the 12-year employee FMLA leave three times during her
tenure. She had accumulated a negative 62.5 points under the employer’s point system
attendance policy in the first four months of the year, 5.5 more than triggered
termination, although her employer only formally warned her. After she cut her foot at
home over the weekend, the employee went to the ER where she got a tetanus shot but no
stitches and a note excusing her from work for only the next day—Monday. When the
employee called her supervisor on Monday, she explained her injury and the fact that she
had a doctor’s note for one day only.
Because the supervisor knew that additional absences would lead to the employee’s
termination, the supervisor asked the employee if her personal physician would “keep her
out longer” so she could qualify for “short-term disability and FMLA.” The employee
said her doctor would not override the ER. She was terminated when she did not show up
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the next day, and the district court granted summary judgment to the employer on her
FMLA interference claim.
Affirming, the appeals court pointed out that all the employer had at the time it initiated
the employee’s termination was notice that the employee (1) could not obtain a note from
the ER for more than one day of excused absence, and (2) did not think she could obtain
a longer excuse from her primary physician. This was simply insufficient to put the
employer on notice that its employee had an FMLA-qualifying serious health condition,
which, the court emphasized, is one that would result in a incapacity lasting more than
three consecutive full days and treatment two or more times or continuing treatment
under the supervision of a health care provider.
Although the employee argued not only that she was still using crutches as of the end of
the week (when she signed termination papers in the office), but that she eventually had
surgery to remove a cyst that grew over her scar, she never produced any doctor’s note
stating she could not work during the relevant period. Even if it assumed the employee’s
appearance on crutches could be seen as notice of an FMLA-qualifying condition (which
the court was unwilling to do), notice given after termination does not trigger an
employer’s FMLA duties.
Finally, it was unavailing that that the employee asserted that her termination wasn’t
effective until she signed termination papers at the end of the week, a time period that she
argued put her employer on notice that she had been incapacitated for more than three
consecutive, full calendar days at the time of her technical termination. The court treated
this contention “that she could simply stay home for three days and then claim she was
incapacitated without producing an iota of medical evidence to support that fact” as
incurably flawed. Her contention that on these facts the employer should have requested
further medical information before terminating her was not reasonable.
The case number is 12-1438.
Attorneys: Terry N. Grimes (Grimes & Williams) for Employee. Dana L. Rust (McGuire
Woods) for Employer.
4thCir: Maryland legislature has not waived school district Eleventh Amendment
immunity against FLSA claims for up to $100,000
By Ronald Miller, J.D.
In an unpublished opinion, the Fourth Circuit reversed a federal district court in
Maryland’s ruling that the Maryland legislature had waived a school district’s Eleventh
Amendment immunity against a claim brought under the FLSA for up to $100,000 in
damages (Gilliland v Board of Education of Charles County, April 26, 2013, per curiam).
In light of the contractual nature of an FLSA claim, the Fourth Circuit concluded that
Maryland courts would not consider it to be an “employment law” claim in this context.
Moreover, the appeals court concluded that Md Code Ann, Cts & Jud Proc Sec. 5-518, as
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construed by Maryland courts, does not apply to the employees’ FLSA claim, and so the
state had not even partially waived the school district’s Eleventh Amendment immunity
against the claim.
The plaintiffs were bus drivers and bus attendants jointly employed by the school district
and certain bus contractors. According to the employees, they were required to work
more than 40 hours per week during their joint employment and were not paid overtime
for the hours they worked in excess of 40 per week. The employees sought conditional
class certification of their complaint. At a motions hearing, the district court conditionally
certified the class, and denied the school district’s motion to dismiss the FLSA claim to
the extent it sought damages up to $100,000.
Statutory waiver. On appeal, the school district asserted that the district court erred in
ruling that it was not entitled to Eleventh Amendment immunity against the FLSA claims
for damages of $100,000 or less. The Eleventh Amendment protects unwilling states,
including “state agents and state instrumentalities,” from suit in federal court. Maryland
school districts fit into that category. Nevertheless, state legislatures are authorized to
enact statutory waivers of Eleventh Amendment immunity that apply to state agencies.
To constitute a valid Eleventh Amendment immunity waiver, a statute must waive the
immunity “by the most express language or by such overwhelming implications from the
text of the statute as will leave no room for any other reasonable construction.”
In this instance, the Fourth Circuit examined two Maryland statutes that appeared
relevant to the waiver issue: Md Code Ann, State Gov’t Sec. 12-201(a); and Md Code
Ann, Cts & Jud Proc Sec. 5-518(b), (c). Here, the parties were in agreement that Sec. 12201(a) could not waive Eleventh Amendment immunity in this case because it applies
only in state court to cases that are based on written contracts. Thus, any legislative
waiver must derive from Sec. 5-518.
The Fourth Circuit found that under relevant state court case law from Maryland’s
highest court, “Sec. 5-518 is a legislative waiver of the defense of sovereign immunity
from a county board of education only with respect to tort claims.” Relying on the
Maryland Court of Appeals decision in Board of Education of Worcester County v BEKA
Industries, Inc, the school district asserted that the FLSA claims are, in actuality, contract
or quasi-contract claims rather than tort or tort-related claims, and so are not of the type
to which Sec. 5-518 applies. On the other hand, the employees relied on a statement from
the same case that Sec. 5-518(c) applies to personal injury claims and “employment law
violations,” and argued that an FLSA claims should be considered an employment law
claim in this context.
Here, the appeals court agreed with the school district. It noted that the decisions of the
Maryland appellate courts make clear that Sec. 5-518’s applicability turns on the type of
claim asserted. The statute applies only to tort claims, and the FLSA claim does not fit
that description. Unlike discrimination claims, which the Maryland courts have
concluded are in the nature of personal-injury claims, FLSA claims “are contractual in
their nature. ”That is so because the FLSA’s overtime provisions “are read into and
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become a part of every employment contract that is subject to” the FLSA’s terms, and
thus “the liability of the employer in an action under the FLSA for unpaid overtime is for
the wages due under working agreements which the federal statute compels employer and
employee to make.” Thus, the district court was reversed and remanded.
The case number is 12-1628.
Attorneys: Scott A. Conwell (Conwell Law) for Employees. Edmund J. O'Meally (Pessin
& Katz) for Employer.
6thCir: Employer request for recertification of FMLA leave reasonable;
termination for excessive absenteeism despite approved intermittent leave lawful
By Ronald Miller, J.D.
In an unpublished opinion, the Sixth Circuit affirmed the holding of a federal district
court that no genuine issue of material fact existed as to whether an employer had a
reasonable basis for seeking recertification of an employee’s FMLA leave and was
justified in terminating her for excessive absenteeism after she failed to provide it
(Graham v BlueCross BlueShield of Tennessee, Inc, April 3, 2013, Stranch, J). Because
the employee’s initial medical certification did not entitle her to take her remaining nine
weeks of FMLA leave in the configuration she chose, the employer lawfully terminated
her employment after she failed to provide the requested recertification.
Employment policies. During the employee’s tenure, BlueCross BlueShield had to
relevant employment policies. Under the employer’s attendance policy, an employee
could face termination if he or she accrued more than five unapproved absences in a
rolling 12-month period. It explicitly provided that an absence would not be considered
an incident if covered under the FMLA. BlueCross reserved the right to require
recertification of the continuance of a serious health condition every six months.
Recertification could also be required prior to the expiration of six months if
circumstances described by the original certification changed significantly.
The employee was approved for FMLA intermittent leave for migraine headaches. The
employee’s medical certification stated that the expected leave frequency was one
episode per month, three to four days per episode. However, the employee was notified
that the submitted certification did not support her leave request because she had
requested leave four times per month lasting three to four days. The employee’s doctor
modified the certification, noting that she “occasionally” had two headaches per month
lasting five to six days. Still, the employee sought leave for four episodes per month, six
days per episode. Ultimately, the employee was approved for intermittent FMLA leave,
noted that additional certification might be required. Following this approval, the
employee missed the next 28 days of work.
Recertification requests. Thereafter, the employee was sent a letter advising her that the
duration of her absence differed from her certification and that it required recertification.
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A follow-up letter advised that the recertification had not been received, so that most of
her absences were not FMLA-approved. Although the employee eventually returned to
work, she was absent for two additional periods without providing the requested
recertification. Her employment was terminated based on the accumulation of 26
unexcused absences. The employee filed suit against BlueCross alleging interference
with her rights under the FMLA.
Arguing that the employee was terminated for excessive absences that were not FMLAapproved, the employer filed a motion for summary judgment. The district court granted
the motion, concluding that no genuine issues of material fact existed regarding the
reasonableness of BlueCross’s request for medical recertification due to changed
circumstances — the duration of Graham’s absences exceeded any of her past absences.
Because the employee failed to provide recertification after having the opportunity to do
so, the court ruled that BlueCross was justified in terminating her.
Elements of FMLA interference claim. On appeal, the employee argued that her initial
medical certification entitled her to take leave in whatever increment she chose, and that
BlueCross’s reliance on her absences to justify her termination violated the FMLA. In
order to succeed on an interference claim, the employee had to must establish: (1) she
was an eligible employee, (2) the defendant was an employer as defined under the
FMLA, (3) she was entitled to leave under the FMLA, (4) she gave the employer notice
of her intention to take leave, and (5) the employer denied the employee FMLA benefits
to which she was entitled.
In this instance, the Third Circuit agreed with the district court’s ruling that employee’s
initial medical certification did not entitle her to take her remaining nine weeks of FMLA
leave in the configuration of her choice. The district court correctly observed that the
FMLA’s requirement that an employee’s medical certification for intermittent leave
include “the expected duration of the intermittent leave,” serves to put the employer on
notice as to how much work the employee might miss and to allow the employer to plan
accordingly. Thus, the appeals court focused on the fifth element of the employee’s
interference claim.
Turning to that issue, the appeals court analyzed whether genuine issues of material fact
exist regarding the reasonableness of BlueCross’s request for medical recertification.
Here, the appeals court also agreed with the district court’s ruling as to the
reasonableness of BlueCross’s request for recertification after the employee’s 28
consecutive absences, in that they constituted “significantly changed circumstances”
under applicable regulations. This period of absenteeism was twice as long as the
employee’s longest previous episode. In her deposition testimony, the employee
acknowledged that she was aware that BlueCross considered her initial medical
certification inadequate to support the number of absences she had accrued. Therefore,
even assuming that the employee did not receive written notice, she was sufficiently
alerted to the need for recertification and to the fact that her employment was in jeopardy
if it was not provided. Thus, the district court’s grant of summary judgment in favor of
BlueCross was affirmed.
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The case number is 12-5309.
Attorneys: Charles G. Wright, Jr. (Law Office of Charles G. Wright, Jr.) for Employee.
Waverly D. Crenshaw, Jr. (Waller, Lansden, Dortch & Davis) for Employer.
9thCir: FLSA collective action and state law class action not inherently
incompatible, even though classes certified using different procedures
By Ronald Miller, J.D.
Agreeing with other circuits, the Ninth Circuit has ruled that an FLSA collective action
and a state law class action are not inherently incompatible as a matter of law, even
though plaintiffs must opt in to a collective action under the FLSA but must opt out of a
class action under FRCP 23 (Busk v Integrity Staffing Solutions, Inc, April 12, 2013,
Thomas, S). The Ninth Circuit reversed a district court’s order that had dismissed the
state law wage-and-hour claims of hourly warehouse workers because they would be
certified using different class certification procedures than the employee’s federal wageand-hour claims.
Integrity Staffing provides warehouse space and staffing for clients like Amazon.com.
The plaintiffs were two hourly employees at two warehouse facilities who sued the
staffing company on behalf of workers at both warehouses, claiming violations of the
FLSA and Nevada labor laws. Specifically, the employees alleged that the employer
violated federal and state labor laws by requiring them to pass through a security
clearance at the end of each shift without compensation. Allegedly, the employees waited
up to 25 minutes to be searched and passed through metal detectors. They also sought
compensation under the FLSA and state law for their unpaid 30-minute lunch breaks
because they spent up to ten minutes walking to and from the cafeteria and/or undergoing
security clearances.
Class certification mechanisms. The district court granted Integrity’s motion to dismiss
the claim, finding that the time spent clearing security was not compensable under the
FLSA. The lower court also held that the employees’ allegations about shortened meal
periods did not state a claim under the FLSA. Importantly, the district court held that the
state law claims “must be dismissed” due to the “conflicting” class certification
mechanisms. Alternatively, the court dismissed the state law claims on the merits,
holding that the employees failed to allege fact scenarios that would support a valid claim
under Nevada law.
As an initial matter, the Ninth Circuit noted that all circuit courts to have considered the
issue, including the Third, Seventh, Second, and DC Circuits, have held that the different
opting mechanisms do not require dismissal of the state claims. The court concluded that
it sister circuits have correctly reasoned that the FLSA’s plain text does not suggest that a
district court must dismiss a state law claim that would be certified using an opt-out
procedure. The FLSA’s opt-in requirement extends only to an FLSA claim, and it
expressly permits more protective state labor laws. Moreover, nothing in the legislative
history of Sec 216(b) of the FLSA supported the view of some district courts that
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allowing both actions to proceed simultaneously “would essentially nullify Congress’s
intent in crafting Sec. 216 and eviscerate the purpose of its opt-in requirement.”
Consequently, the Ninth Circuit agreed with the other circuits to consider the issue that
the fact that Rule 23 class actions use an opt-out mechanism, while FLSA collective
actions use an opt-in mechanism, does not create a conflict warranting dismissal of the
state law claims.
Security clearance. Turning to the merits, the appeals court disagreed with the district
court’s holding that the employees’ failed to state a claim under the FLSA for the time
spent at the end of the day passing through security clearance. Here, the employees
alleged that Integrity required the security screenings, which must be conducted at work,
as a means of preventing employee theft. As alleged, the appeals court found that the
security clearances were necessary to the employees’ primary work as warehouse
employees and done for Integrity’s benefit. Consequently, the employees stated a
plausible claim for relief. Because the appeals court held that the employees stated a valid
claim for relief under the FLSA for time spent passing through security clearances, it also
reversed the dismissal of the parallel state law claim.
Shortened lunch periods. On the other hand, the appeals court affirmed dismissal of the
claim for shortened lunch periods. The FLSA does not require compensation for an
employee’s lunch breaks, but an employee cannot be docked for lunch breaks when he or
she is required to continue any duties related to work. Here, the employees alleged that
they were not “completely relieved from duty” because by placing the time clocks far
from the lunchroom, Integrity forced upon them the “duty to walk to the lunch room in
order to eat lunch.” However, the appeals court found that the district court got it right in
ruling that walking to the lunchroom is not a work duty since it was not necessary to the
employee’s principal work as warehouse employees. Accordingly, the district court’s
decision was affirmed in part, reversed in part and remanded.
The case number is 11-16892.
Attorneys: Mark R. Thierman (Thierman Law Firm) for Employees. Rick D. Roskelley
(Littler Mendelson) for Employer.
9thCir: Employer failure to comply with discovery deadlines properly results in
discovery sanctions
By Ronald Miller, J.D.
A federal district court did not abuse its discretion in imposing discovery sanctions
against an employer for failing to honor discovery deadlines, ruled the Ninth Circuit in an
unpublished decision (Rother v Lupenko, April 12, 2013, per curiam). Moreover, the
appeals court upheld the lower court’s denial of the employer’s motion for summary
judgment with respect to the employees’ unpaid meal break claims after finding that the
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evidence supported its ruling that the employees were not compensated for breaks of less
than 30 minutes.
With respect to sanctions, the appeals court observed that a district court has broad
discretion in imposing discovery sanctions where a party flouts its discovery obligations.
It also noted that it would defer to the reasonable exercise of that discretion so long as it
could discern from the record why and how that discretion had been exercised. In this
case the record was perfectly clear that the court imposed sanctions as a result of the
employer’s having twice failed to honor discovery deadlines; thus, to remand the matter
to the district court for further explanation would unnecessarily “elevate form over
substance.” Further, the employees provided detailed accounting of their costs and fees
resulting from the employer’s discovery violations, and the amount awarded was
reasonable. Accordingly, the district court did not abuse its discretion in its imposition of
discovery sanctions against the employer.
Unpaid meal breaks. The employer also appealed the district court’s denial of its motion
for summary judgment on the employee’s unpaid meal break claims. Here, the appeals
court observed that although the employees’ complaint did not spell out their unpaid
break claims, the employer nonetheless had sufficient notice of those of claims at the
summary judgment stage, and it was within the district court’s discretion to allow those
claims to proceed.
As to the merits of the employees’ claims, the court noted that it is the general rule under
federal law that breaks of less than 30 minutes are compensable, 29 CFR Secs. 758.18,
and 758.19. Similarly, Oregon law also entitles employees to receive compensation for
breaks of less than 30 minutes, Or. Adm. R.839-020-0050(2), and “authorizes an
employee who is not paid all the wages to which entitled to bring an action to recover
those unpaid wages, plus penalties.” In this case, it was undisputed that the employees
were not always compensated for breaks of less than 30 minutes, so that their unpaid
break claims were properly allowed before the jury. Consequently, the district court did
not abuse its discretion in refusing to grant the employer’s motion for summary judgment
as to the employee’s unpaid breaks claim.
Attorneys’ fees. The Ninth Circuit also rejected the employer’s contention that the
district court’s award of attorney fees to the employees was excessive. Again, the appeals
court reviewed the lower’s court’s ruling for abuse of discretion. Here, it was undisputed
that the employees were the prevailing party, and the employer was unable to show that
the district court abused its discretion in the amount of the attorney fee award. Although
the jury awarded less than the employees sought, it awarded more than nominal damages,
and it was within the lower court’s discretion to use the employees’ current fee rates in
the lodestar calculation. Accordingly, the court rejected the employer’s argument that the
district court abused its discretion in its award of attorneys’ fees.
Late paycheck claims. Turning to the employees’ contentions on appeal, the Ninth
Circuit reversed the district court’s entry of summary judgment for the employer on the
employees’ federal minimum wage claim. The appeals court observed that even though
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the FLSA does not explicitly require employers to pay its employees in a timely fashion,
the Ninth Circuit, in Biggs v Wilson, has read such a requirement into the Act. Biggs held
that payment must be made on payday, and that a late payment immediately becomes a
violation equivalent to non-payment. After payday, the minimum wage is “unpaid.” For
purposes of the FLSA, there is no distinction between late payment violations and
minimum wage violations. Accordingly, the district court’s grant of summary judgment
for the employer on the employees’ federal minimum wage claim was reversed.
On the other hand, Oregon law expressly draws a distinction between late payment
violations and the minimum wage violations that the FLSA does not. Oregon law, Or.
Rev. State. Sec. 652.120, includes an explicit provision mandating the timely payment of
wages. Thus, there is no need for courts to read a timeliness requirement into the statute’s
minimum wage provision, or treat late payment as non-payment. Consequently, the court
affirmed the district court’s grant of summary judgment to the employer on the
employees’ state minimum wage claim.
The case numbers are 11-35922, and 11-35953.
Attorneys: Jon M. Egan (Law Office of Jon M. Egan) for Employee. Jonathan W.
Henderson (Davis Rothwell Earle & Xochihua) for Employer.
11thCir: Food service workers unable to show that employer’s contract with
university terminated in retaliation for their participation in employment suit
By Ronald Miller, J.D.
Food service workers were unable to establish that a university terminated its contract
with their employer in retaliation for their participation in a suit alleging that the
employer violated the FLSA and Title VII, ruled the Eleventh Circuit in an unpublished
decision (Wigfall v St Leo University, Inc, April 29, 2013, per curiam). Because it was
undisputed that the university believed that it would save money by terminating the
contract, whether or not it knew an exact figure was irrelevant to whether it offered this
reason as pretext for retaliation.
Food service workers employed by Sodexo and stationed at Saint Leo University sued
Sodexo for race discrimination, unpaid wages and battery. The suit was settled and
Sodexo was required to make several changes to its operations at Saint Leo. Following
the settlement, Saint Leo notified Sodexo that it was terminating the food services
contract. In view of the contract termination, Sodexo notified its employees at Saint Leo,
including the plaintiffs, that it would “no longer be able to employ them at Saint Leo.”
Thereafter, the plaintiffs brought suit against Saint Leo for retaliatory termination in
violation of the FLSA and Title VII, among other claims.
The plaintiffs’ apparent theory was that Saint Leo terminated its contract with Sodexo—
which led to their terminations—to retaliate against the plaintiffs for participating in the
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lawsuit against Sodexo. Saint Leo moved for summary judgment, and the district court
granted that motion.
Pretext issue. On appeal, the Eleventh Circuit concluded that even assuming that Saint
Leo was a joint employer with Sodexo, and that the plaintiffs established a prima facie
case of retaliation under each statute, the plaintiffs nonetheless failed to show that the
reasons Saint Leo proffered for the contract termination were pretextual. Each of the
statutes cited by the plaintiffs contained provisions prohibiting an employer from taking a
retaliatory employment action against an employee because that employee engaged in an
activity protected by the statute.
Here, summary judgment was proper because Saint Leo offered lawful reasons for
terminating its contract with Sodexo and the plaintiffs failed to show that those reasons
were pretexts for retaliation. Saint Leo asserted that it terminated the contract: (1) to save
approximately $400,000; (2) to hire the Sodexo’s food service manager on the campus,
who would have been transferred under the settlement agreement; and (3) because it was
disappointed by the lack of communication from Sodexo regarding the requirements of
the settlement.
The fact that the university did not have more specific knowledge of the amount of
savings to be gained by cancelling the contract did not suggest pretext. Further, the
plaintiff’s contention that the university could have saved money and kept the food
service manager without terminating the contract was relevant to whether it made the best
business decision but not to whether it offered the reason as a pretext. Finally, the
plaintiffs failed to offer any evidence that the lack of communication from Sodexo was a
pretextual reason for terminating the contract. Thus, the district court’s grant of summary
judgment was affirmed.
The case number is 12-11316.
Attorneys: Sonia C. Lawson (Lawson Law Office) for Employees. Karen M. Buesing
(Akerman Senterfitt) for Employer.
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