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September 1, 2014

Agency Under Fire

The partisan tug-of-war over the NLRB worsens, even as unions decline.

Liberal and conservative. Democrat and Republican. Labor and management. No matter how you cut it, the public perception of the National Labor Relations Board comes out neatly bifurcated. It’s one of those federal agencies whose mere mention brings some people to a slow boil or a warm glow. Like the Environmental Protection Agency or the IRS, the NLRB has the power to disrupt the best-laid plans of CEOs—overturning personnel decisions, dictating payment of salaries, seeking injunctions against delinquent employers—and to inspire florid speeches of approval from pro-union academics.

Created in 1935 to bring order to tumultuous, often-violent labor relations in the United States, the NLRB has conducted union elections, mediated employer-employee disputes and investigated hundreds of thousands of allegations of unfair labor practices. But in the process of carrying out its mandate to “guarantee the rights of employees to bargain collectively,” as described in the National Labor Relations Act, it has become a crater-pocked battleground for contending ideologies, to say nothing of contending political parties. And the battle is more intense than ever, people on both sides of the divide say.

Employer groups and company managers, including many in the labor-intensive metals industries, are especially worried about a series of what they say are arbitrarily pro-union initiatives that have emanated from the board in recent years. These include a proposed “ambush election” rule to speed up union drives, a required workplace poster to remind workers of their collective bargaining rights, and the right to create small “micro-unions” in larger plants or stores, among other hot-button issues. The NLRB has been one of the sharpest points of conflict between President Barack Obama and Congress, with Republican senators, dissatisfied with openly pro-labor candidates for the board, using filibusters to block appointees. 

Earlier this year, the battles spilled into the U.S. Supreme Court, which decided that Obama had exceeded his authority by filling board vacancies without Senate confirmation. Three seats on the five-member board remained empty during much of the Obama administration, because of those filibustering U.S. senators. Once filled, in a manner now ruled unconstitutional, the board operated for 18 months under a legal cloud. More than 400 rulings were issued during that period, but the now legally constituted board, at press time, was expected to reaffirm those still being challenged.

Quite a bit of action for a relatively small federal agency with some 1,600 employees and a $285 million annual budget that is, for perspective, less than 4% of the EPA’s.

“What’s happened with the NLRB over the past few years—all the controversies—has really been in some ways emblematic of the political fault lines in this country,” says Wilma Liebman, who served on the board for 13 years, stretching from the Clinton administration, through George W. Bush, to the Obama administration. If that is so, those fault lines seem to be moving against the unions. Between 1983 and 2013, union membership declined from 17.7 million workers to 14.5 million and from 20% of the workforce to about 11%, according to the Bureau of Labor Statistics.

                               

Still a Locally Focused Agency 

Most of the business of the agency, in any case, is carried out in small increments, addressing localized labor-management disputes on issues that rarely draw any attention outside of the communities where the problems occur. In recent months, for example, the board has ordered a company providing flight simulation services at a naval air station in Fort Worth to pay $105,000 in back pay to three employees who were “discriminatorily” replaced by lower-paid workers. In another case, 12 workers at a special education school in Yonkers and the Bronx, New York, were ordered reinstated with back pay after they were laid off during a union drive.

The metals industries have not been immune to these low-profile, NLRB-enforced dictates. In February, the agency announced a settlement between World Class Corrugating LLC, a roofing and siding business in Louisville, Kentucky, and Local 89 of the Teamsters union, after the NLRB had threatened the company with an injunction. The dispute arose when World Class Corrugating purchased Wheeling Corrugated Company assets in a bankruptcy proceeding and sought to scuttle a union contract by declining to rehire most of Wheeling’s union members. It ultimately cost World Class Corrugating about $120,000 in back pay and $11,000 in other expenses incurred by the workers, 18 of whom were reinstated.

But even though many of these single-shop cases have relatively modest outcomes, business groups like the National Association of Manufacturers and the U.S. Chamber of Commerce see a relentlessly pro-labor agenda at work, particularly in recent years.

“In terms of some of the rule-making and the case decisions we’ve seen coming out of the board, we see a very aggressive agenda,” says Amanda Wood, director of labor and employment policy for NAM.

 

Whatever the agenda may be, on a day-to-day basis, the process can be quite convoluted. Before the full board addresses a particular complaint, it is investigated by one of 26 regional offices. About 93% of cases are resolved at this level, when opposing parties choose to negotiate agreements rather than proceed with the complaint process. If a dispute can’t be resolved, it’s referred to one of 40 administrative law judges at various locations around the country. Hearings are held with witnesses and evidence presented by contending parties. Only after a court hearing and a decision by a judge can it go to the board (this only happens in about 1.4% of all cases, 342 out of some 24,000 in 2013).

But matters don’t necessarily end there. Any ruling by one of the judges, even with concurrence by the board, can still be taken to a federal appeals court by a party in the dispute. In rare cases, like the Canning case, which overturned the Obama interim appointments, judicial action can rise to the level of the U.S. Supreme Court.

 

Crafting New Rules and ‘Ambush’ Elections

Along with adjudicating disputes, the five-member board also has the power to craft new rules relating to job sites or to the collective bargaining process.

It’s here that the Obama board has shown its true colors, critics say. In one example in February, the board, controlled by three Democratic appointees, issued new rules regarding the timing of union elections. NAM has dubbed it the “ambush election” rule (it’s the second time the rule has been proposed; the first time was in 2011, when it was dismissed by a federal court on a procedural technicality). It would shorten the time between filing a petition to form a union and the vote by employees—from the current average of 45 to 60 days to as little as two weeks or less, NAM contends. The new rules would also require employers to supply names and addresses of potential union members to organizers and to schedule their pre-election hearings within seven days of the petition being filed.

“For our small or medium-sized members, with no in-house labor counsel, they could find a petition on their desk just before, say, the Thanksgiving break,” says Wood of NAM. “They’re thinking they have to get up to speed on this, and then the election takes place.”

The NLRB is “creating a problem where none exists,” adds Matt Lavoie, NAM’s director of media relations, who says that the median time of 38 days between petition and election is “certainly not an unreasonable amount of time.”

Supporters of the measure, however, say that the current system allows the employer multiple options to delay an election—and the longer the wait, the longer the employer has to undermine pro-union sentiment through subtle threats and intimidation. “The employer can mount a very aggressive, sustained campaign against those in the workplace who want a union,” says William Samuel, director of government affairs for the AFL-CIO.

 

Once the petition is filed, the employers have all of the advantages, Samuel contends. “They can hold unlimited meetings, captive-audience meetings, meetings that employees have to attend and they’re told not to ask questions,” he says. In recent years, about 35% of union drives that are resolved with elections—about 4,500 in the past three years—end up being defeated, according to NLRB statistics.

If the election streamlining rule is officially promulgated by the board after further hearings and public comment, expect a legal blitz by employer groups to block its implementation.

In another initiative, the board issued a rule that would have required employers to post a notice in workplaces informing employees of their right to organize and strike. The board meant the so-called poster to be similar to postings required by the Occupational Safety and Health Administration regarding workplace safety requirements, but employer groups saw it as a call to rebellion on the part of workers.

As harmless as the board may have meant it to be, the requirement was struck down by the U.S. Court of Appeals in Washington, D.C., on First Amendment grounds, and earlier this year, the board allowed its right to appeal to lapse. “They ceded to our arguments when they decided not to appeal to the Supreme Court,” says NAM’s Lavoie.

There are others. Employer groups have lengthy agendas for attacking NLRB rulings, which have included a decision to allow nursing assistants at an Alabama nursing home to form their own “micro-union” within the facility, and a ruling to expand the amount of personal information about employees that employers must share with unions.

 

Providing the Rule of Law

Liebman says that parties frustrated by the NLRB often talk about eliminating or defunding the agency. “I’ve heard it five million times,” she says.

But few on either side of the ideological divide really want to see the NLRB go away. Without the NLRB, the innately adversarial relationship between labor and management could in some cases descend into chaos, Liebman says.

“It provides the rule of law,” she says. “This country has had a very violent labor history. When the statute was enacted during the Great Depression, it pretty quickly substituted a rule of law for anarchy and violence. It’s hard to imagine a democratic capitalist system that doesn’t have a labor law system.”

Not for some, though. William Marsh, president of American Bar Products in Warminster, Pennsylvania, is a passionate exponent of the libertarian position that there’s already a natural balance between management and labor in the United States. “The moment the government steps in, it upsets the balance,” says Marsh, who believes all labor relations issues can be solved by the free market without the NLRB.

Still, employer groups, unions and students of the system generally recognize a need to maintain the NLRB and reform it. They just don’t agree on how.

 

The board’s difficulties in putting together a quorum have been an ongoing source of problems. “Because of the difficulties in getting board members confirmed, there can be long periods of vacancies,” Liebman says. “When new board members finally come in, they have to learn the cases and there’s more delay.”

Peter J. Hurtgen, a board member between 1997 and 1999 and chairman between 2000 and 2002, agrees that many of the board’s problems can be traced to the appointment process. With Republicans appointing pro-management members and Democrats appointing pro-labor members, the board—and its approach to labor relations—tends to rock from left to right. “It’s become so political, it’s simply a whipping institution for organized labor on the one hand and a significant sector of the management community on the other,” Hurtgen says.

While appointments to the board are supposed to be staggered to avoid being stacked by one president, the board historically reflects the party of the current president. Thus, Democrats dominated the board during most of the Clinton administration, Republicans took over during the George W. Bush years and Democrats returned to a majority for the Obama administration.

 

Suggestions for Reform

Hurtgen proposes to remove some of the political juice from the system by having board members appointed like federal judges, for life terms. “That way, you wouldn’t have this effort every time there’s a change in the White House, with one side or the other putting in their people.”

The unions would like to see the NLRB strengthened, with penalties for employer violators in addition to orders for back pay to workers whose rights have been violated.  “It’s pretty easy now for employers to avoid unionization,” contends the AFL-CIO’s Samuel. “With a battery of lawyers and very weak penalties, they can interfere with what should be a free choice made by their workers.”

Employer groups say the present system can work just fine if it’s administered fairly.

“The state of the [NLRB] law as it was four or five years ago was fairly balanced,” says Randel Johnson, the U.S. Chamber of Commerce’s senior vice president for labor, immigration and employee benefits. “But the current board is trying to imbalance it improperly in favor of the unions.”

Johnson envisions the NLRB providing ideally “a matrix of employers and unions that can legitimately make their positions heard. The unions could organize workers and the employers could push back.” Because of pro-union Democrats’ dominance on the current board, however, rulings have been one-sided, he says. “I think this board has gone a lot farther than even past Democrat boards went,” Johnson says.

But the NLRB was not created to provide balance but to encourage collective bargaining, says James A. Gross, a professor of labor relations at Cornell University and a leading expert on the NLRB.

“People say, ‘Oh, no, the government is supposed to be neutral,’” Gross says. “People think employers are permitted to resist the exercise of freedom of association by their employees and the only time the government gets involved is to make sure there’s a free election. But that’s not what the law says.”

 

The National Labor Relations Act, even after it was amended in 1947 by the Taft-Hartley Act (which put some restraints on union activities and declared some organizing tactics to be themselves “unfair labor practices”), is supposed to foster unionization and “encourage” collective bargaining, Gross says. “Encourage. That’s not my word. It’s a statutory word.”

Johnson dismisses such reasoning as simplistic. “It’s misleading to focus on one word in the statute,” he says. The law also includes specific protections for those who don’t want to unionize, he says, citing a section that accords employees “the right to refrain” from joining a union or engage in collective bargaining or concerted activities.

Those battle-hardened in the labor-management wars expect things to continue pretty much the way they have been. All of the current board members and the general counsel, Richard F. Griffin Jr., declined to be interviewed for this article. When it comes to labor and management, says Hurtgen, “there’s no such thing as neutral. Everybody has a view, an opinion, and it’s impossible not to have one.”

Yes, there should be NLRB reform, adds Liebman. “The law, the process, everything should be modernized,” she says. In particular, there should be a streamlining of the voting process for union elections, Liebman contends. But given the nature of the antagonists and the fractures in our politics? “It ain’t gonna happen,” she says.


Edmund Newton is a Washington, D.C.-based writer, formerly of the L.A. Times, Newsday and the New York Post, as well as the former managing editor of New Times-Broward Palm Beach. He has written for, among others, The New York Times, Time, People, Daily News Sunday Magazine, Black Enterprise, Ladies’ Home Journal, Essence and Audubon.