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November 17, 2014

President Obama Withdraws NLRB Nominee – But Will It Matter For Labor Agenda?

President Barack Obama announced last week that he was pulling the nomination of Sharon Block for the National Labor Relations Board and instead nominating Lauren McFerran, who is currently chief labor counsel for Democrats on the Senate Committee on Health, Education, Labor, and Pensions, for the post. The Wall Street Journal reports Senate Democrats hoping to confirm McFerran before Republicans take over the chamber in January have already scheduled the first hearing on her nomination for this Thursday, Nov. 20.  

Prior to the announcement about the president’s NLRB nominations, Inside Counsel argued the board would continue to expand its reach over the coming two years. We agree with Inside Counsel – here’s a reprint of its argument in full:

In the past, non-union employers paid very little attention to the National Labor Relations Act (NLRA) as those companies rarely had their employment policies and practices scrutinized by the National Labor Relations Board (NLRB). Instead, the non-union employers had a false sense of security in believing the NLRB would leave them alone because they had no unionized employees. It often felt as though non-union employers only took notice of the NLRA or NLRB when a threat of unionization appeared or when it appeared the Employee Free Choice Act would pass in 2009. However, as non-employers have learned over the past few years, times have changed.

Despite the failure to pass the Employee Free Choice Act or the U.S. Supreme Court’s unanimous rebuke of President Obama’s recess appointments in National Labor Relations Board v. Noel Canning, the Board appears relatively unfazed. Instead, the NLRB has continued its activist role in supporting labor unions’ organizing efforts. In this two-part series, we will examine various activities by the NLRB and why non-union employers should take notice.

Proposed “quickie” election rules

In February 2014, the Board proposed to changes its election rules, and such changes have often been referred to as the “quickie” election rules or “ambush” rules. Among other things, under the proposed “quickie” election rules, elections now would be held within 10 to 21 days after a union files a petition to represent a group of employees in comparison to the average time (42 days) under the current rules. By expediting the time for elections, employers have far less time to communicate and counter the union pitches that have already been made to employees “under the radar.” In other words, employers will be strained and playing catch-up to the union propaganda. The result could mean more successful unionization of companies.

Expansion of the “micro-unit” rule

In July 2014, the NLRB also expanded “micro-units” to the retail industry. Previously, labor unions sought to organize the largest employee groups, and employers were successful in defeating those organizations through effective communications with these groups. However, now unions have discovered smaller employee groups are easier to organize and elections can be conducted quicker, making it more difficult for employers to counter.

And, the Board is supporting this strategy as demonstrated by its landmark decision in Macy’s, Inc. v. Local 1445, United Food and Commercial Workers Union. In the Macy’s decision, the Board allowed cosmetic and fragrance workers at a single Macy’s store to organize. Although Macy’s argued that such organization would create “a proliferation of micro-units based solely on the products sold by employees” which would result in “chaos and disruption of business,” the Board found otherwise. As a result of the Macy’s decision, employers should brace themselves for labor unions to continue to target smaller employee groups for organization.