A Discussion of Labor Law: Is the Taft-Hartley Act Being Interpreted as Written?

Marco Lloyd: Hello everyone and welcome to this Federalist Society virtual event. My name is Marco Lloyd and I'm an Assistant Director of Practice Groups with the Federalist Society. Today we're excited to host this FedSoc Forum virtual event, "A Discussion of Labor Law: Is the Taft-Hartley Act Being Interpreted As Written?" with Fred Jacob and John Ring. Fred Jacob is a Solicitor of the National Labor Relations Board advising the board on major questions of law and policy concerning the board's general operations, as well as the adjudication of board cases in the courts of appeal and the US Supreme Court. Mr. Jacob is also a professorial lecturer in law at the George Washington University Law School. John Ring is a partner at Morgan, Lewis & Bockius, and from 2018 to 2022, he served as a board member of the National Labor Relations Board, and from 2018 to 2021, he served as the board's Chairman.

 

Mr. Ring has been with Morgan Lewis for almost 30 years where he has served as Co-Chair of the firm's Labor and Management Relations practice and Practice Group Leader for the Washington Office's Labor and Employment Law practice. If you'd like to learn more about today's speakers, their full bios can be viewed on our website fedsoc.org. And if you have a question at any point in today's program, please enter into the Q&A function at the bottom of your zoom window and we'll do our best to answer as many as we can. Finally, I'll note that as always, the Federalist Society takes no position on particular legal or public policy issues and all expressions of opinion are those of the speaker. With that, Mr. Jacob, Mr. Ring, thank you for joining us today and the floor is yours.

 

Hon. John F. Ring: Great, well thank you very much. I'll start. Appreciate the opportunity to present today on the topic of the Taft-Hartley Act. Federal labor law has always involved - Fred, you want to put up that slide? Fred's in charge of slides. Federal labor law has always involved some level of controversy, including significant disagreements between employers and unions. And former NLRB Chairman John Fanning, one of the longest serving board members - he served on the NLRB for 25 years during the sixties and seventies - once famously said, "Labor relations has always been a field that arouses strong emotions, sometimes more emotions than reason." He said, "As someone who participated in over 25,000 board decisions, I can assure you that the one factor in every case has in common is the presence of at least two people who see things differently." There are probably many reasons for our country's contentious and much debated labor policy, but one of the reasons must be that the statute undergirding that policy, the National Labor Relations Act, is itself somewhat conflicting, at least in certain places and really represents two very different and competing statutory objectives.

 

The two statutes that make up the bulk of the National Labor Relations Act, of course, are the Wagner Act that was passed in 1935 and the Taft-Hartley Act passed 12 years later in 1947. The Wagner Act, a New Deal statute, set forth a bold new labor policy for the country. It promoted collective bargaining, gave employees the right to form and join unions, and it obligated employers to bargain collectively with those unions when they were selected by a majority of the employees for an appropriate unit. The Taft-Hartley Act was enacted largely to address some of the problems and some of the union misconduct that had been experienced under the Wagner Act during those first years. And the Taft-Hartley Amendments - generally viewed as more favorable to the management side - was literally plopped right down right in the middle of the Wagner Act text.

 

So although the Taft-Hartley amendments largely left intact the Wagner Act's Section Seven - rights for employees - significant new language was added, giving employees the right to refrain from participating in union activity and other mutual aid activities. And of course, the Taft-Hartley Act had a number of other provisions that curbed union power, including six new unfair labor practice charges directed at union conduct. Over the years, these dueling policy goals have fueled some of the conflicts and interpretations of our labor law and allowed rather spirited debate on each side with each side really able to point to some statutory provision to support their potential conflicting policy position. So when, for example, Senator Elizabeth Warren, during my Senate confirmation hearing, for joining the board, tried to get me to say that I would commit to uphold the objectives of the National Labor Relations Act, which she said promoted collective bargaining.

 

I could say that I would do that, but I would also enforce the central objective of the act, which was to promote industrial peace. While labor unions like to say that the National Labor Relations Act is supposed to help employees unionize, there's the Taft-Hartley side that says unionization is for those employees who so choose, or when union advocates say that NLRA makes union organizing something that is solely a matter between employees and the union, Taft-Hartley says that employers have a right to have a voice in that workplace debate. So why after 80 years you might ask, are we talking about the Taft-Hartley Act today? Now is a good time to take a look at the Taft-Hartley provisions and some of the interpretations by the National Labor Relations Board as compared to this actual statutory language. And we do so here as the NLRB majority pushes new boundaries in the General Counsel, and new interpretations, and also the courts are now in a post-Chevron deference world, and whether or not they might be more inclined or less inclined to defer to those interpretations.

 

For today's discussion, I have the privilege of being joined by someone I admire greatly, the current Solicitor of the Labor Board, Fred Jacob. He is a true public servant with vast historical knowledge and practical insights into labor law and particularly the Taft-Hartley Act. Fred and I worked together when I was at the board, the Solicitor is the board's lawyer, so we worked closely together when I was Chairman, and little known fact we were both baby lawyers at Morgan Lewis long ago. So I'm really pleased to have him with us today and I think you'll learn a great deal from him. One caveat about Fred, besides him being a complete labor law nerd, is he is appearing today in his official capacity and he may say more about this, but he's not going to advocate for any particular positions or characterize any interpretations other than to explain NLRB precedent kind of from an institutional or historical perspective. Our plan today is to go through - and Fred will do this - go through, discuss a bit of the history of the Taft-Hartley Act and then we'll discuss several timely Taft-Hartley issues and we're hoping to, we'll leave enough time at the end for some questions, so I'll turn it over to Fred.

 

Fred B. Jacob: Excellent, thank you so much, John, for the great introduction and for the kind words you said about me. Thank you for hiring me to be the solicitor at the NLRB, which is a dream job for NLRB nerds, and I assume most of you on the call would characterize yourself that way too, and in an endearing and wonderful way. As John said, I'm here in my official capacity, which basically means that I'm here to serve as an institutional historian for the discussion. If you were here to see point-counterpoint, you probably won't see that, but I may try to point out sources that would be interesting for you to read to get a full sense of the debate to the extent that there are public sources available and certainly I'll point out good precedent and board precedent that has brought us to the place we are. So let me click through our PowerPoint.

 

So we're starting here. As John said, we have competing - there are different words in the act that have slightly different policies and how you read the act often shaped how you would administer the act. So here is a quote from Section One which says, "It is the policy of the United States to encourage the practice and procedure of collective bargaining." And then here we have Section Seven which says, "Employees have a right to refrain" and built into that is Section Nine, which talks about representation cases and the right to choose and being free from unfair labor practices and it's the board's responsibility to administer all of that. So what I'm going to talk to you a little bit about at the beginning is the path to the Wagner Act and then the path from the Wagner Act to Taft-Hartley. Now, I don't know if you all can see, there are at least this many books on it.

 

This book is called "From the Wagner Act to Taft-Hartley", and it's many, many pages and I will not be reading it to you, but the big overview I think starts with this mural which is found at the UAW headquarters. And this is a mural of President Roosevelt signing the Wagner Act. I like to think of it almost like a little comic strip because it tells the story. The Wagner Act begins in the 19th century and the early 20th century with the rise of labor unions in the post-industrial - in the post-war Industrial Revolution era, as workers began to combine and build power together to try to find equality of bargaining power that would compete with the newly emerging industrial society that was moving folks from traditional craft work and traditional agricultural work to industrial factory work. And during this time period we saw tremendous disruption to the economy and to society that was caused by employees being denied the right to unionize.

 

So employee unions were viewed as a violation of antitrust laws. They were viewed as civil conspiracies, they were viewed as criminal conspiracies. And I know particularly for you legal experts, I'm speaking at a very high abstract level, but I ask for your forgiveness and your permission to do so because there's so much detail and there's such a rich story. And for me to cover it in tremendous detail, we would be here not for an hour, but for a week and probably more than that. So these battles, these battles because employees couldn't receive legal protection, ended up erupting into violent strikes, whether we're talking about the Haymarket Massacre, the Colorado Mining Massacre, where hundreds of employees were murdered by state troopers or even the battles in West Virginia over in Mingo County that were depicted in the "Matewan" the movie, where the federal government ended up bombing strikers who were trying to protest for their right to organize and their right to be recognized as a bargaining representative.

 

So the Wagner Act is dropped in the middle of all this and you combine it with the middle of the Great Depression. So as when President Roosevelt and the New Deal were first inaugurated, the National Industrial Recovery Act protected the right to organize. And Section Seven-A of that act was administered by two agencies like the NLRB, the National Labor Board and the Old NLRB. And both of them showed the government that there was a utility in having a federal agency that could help protect the right to organize. And the Wagner Act emerged out of the ashes of the National Recovery - Industrial Recovery Act when the Supreme Court struck it down. So what did the Wagner Act do? It was enacted in 1935, and here's President Roosevelt signing it. And as John said, it protected employee's right to organize and it made certain unfair labor practices unlawful - but they were employer unfair labor practices - and it put together an enforceable mechanism for employees to be able to choose union representation.

 

And in the aftermath of the act's passing, most people believed that the act would be struck down as unconstitutional pursuant to all the commerce challenges that had found that these sorts of economic regulations were unconstitutional. But in 1937, the Supreme Court with the "switch in time that saved nine" found the act constitutional in Jones & Laughlin, there's Senator Wagner being joyously out of his - just being so joyous that the act was upheld. And in the aftermath of the act being upheld, union organizing exploded. Part of that, as you can see was these were union propaganda pieces that were distributed during this era that essentially said "The entire federal government wants you to join a union, the Congress, the president, and now the Supreme Court." Union density went through the roof and of course, the NLRB was there to help, as Professor James Gross once said, to "serve as the midwife" of the labor movement. Being the midwife of the labor movement drew a lot of attention to the NLRB and part of that was negative attention from management groups from industrial, particularly southern senators, southern Congressmen, and the Board during this time period also engaged in a lot of actions that we might raise our eyebrow at now.

 

So in the early 1940s there were a series of committee investigations in Congress driven by Congressman Smith from Virginia and they investigated a whole host of issues of the board and some of them we'll talk about further, but they involve the challenges of having one agency under the Wagner Act that was responsible for both prosecution and adjudication - issuing complaints and adjudicating complaints. And sometimes in the early days of the Wagner Act, there were allegations that the board's personnel in particular crossed the line and the prosecutorial function interfered with the adjudicative function.

 

At the same time, what we have is there were also issues with - I mean some of them were issues with the CIO and the AFL who had just split. And the board was viewed as favoring CIO unions over the AFL unions. And then after World War II, there was a massive strike wave that hit the United States. It was caused primarily by pent-up economic frustration because unions had foregone wage increases during World War II, and that strike wave which involved millions and millions of employees really created a backlash against unions. And so it set the stage for Congress to look at amending the Labor Act and look at amending the Wagner Act, which it did in Taft-Hartley in 1947 over President Truman's Veto. And what the Taft-Hartley Act did was it amended the Wagner Act in ways that were both routine and mundane or might seem routine and mundane, and in ways that were pretty dramatic.

 

So what I would put in the routine category, which is not routine for me as an NLRB employee, is that it completely reorganized the structure of the NLRB. It created an independent office of the General Counsel that was appointed by the president that didn't exist under the original Wagner Act and retained the board but expanded its membership from three to five. And in essence as we'll talk about more, it created two different power centers at the board, a prosecutorial function and a separate adjudicative function. It eliminated the board's ability to conduct economic research, which the board had done under the Wagner Act, really trying to shift the board into an adjudicative role.

 

On a substantive level, the board added union - Congress added union unfair labor practices. So in addition to making it unlawful for unions to interfere with Section Seven rights and discriminate against employees and refuse to bargain in good faith, it also banned certain kinds of secondary boycott activity. And again, we'll talk about that more later. It added Section 8-C of the act, which is a free speech guarantee, and it added section 10-C of the act, which provided employers would not be required to reinstate employees who were fired for just cause. And all of these have very interesting statutory language that the board and the courts have expanded on since 1947 in ways that might seem a little incongruous if you're just looking at the plain text. And we'll talk about all of those as we go. And here's President - I didn't PowerPoint in real time, but this is President - when President Truman vetoed the TAFT-Hartley Act. And then if you are a nerd like me and you shop eBay for words Like 'Taft-Hartley", you end up with a signed copy of Fred Hartley's book about the Taft-Hartley Act.

 

So with that, I think we are going to pivot. John, I think I'm going right? Okay. So what we wanted to start with is talking a little bit about the dual structure of the NLRB and the board versus General Counsel, and this is sort of the statutory language that we're talking about. Section 10-A empowers the board to prevent any unfair labor practice and then all throughout the act there are discussions of the board's powers, section 3-D. It does a lot of things, but what it does is it gives the general counsel final authority on behalf of the board to investigate charges and prosecute charges and complaints. So this is the statutory language we're dealing with when we're talking about these various power centers. Again during the Wagner Act era and with the passage of the APA, Congress showed - and passed Taft-Hartley - that it really wanted to separate these functions and it did it at the board in a way that's kind of funky because we have again, a General Counsel that is independent, presidentially appointed, and now confirmed to be an executive branch officer and a board that is an adjudicative officer.

 

So shortly after the passage of the act, what we saw was the board both on an administrative level and on a legal level trying to sort out where the line is between prosecutorial power and adjudicative power, so you know - and administratively fighting incredible conflicts - John in particular loves this story, which I will quickly tell you. The very first General Counsel was a man named Robert N. Denham who President Truman appointed because he was a true believer in the Taft-Hartley Act. And it created a fair amount of conflict with the old board members who were mostly Wagner Act board members, however, what the act would mean and Denham believed that it was his job to prosecute the Taft-Hartley Act aggressively. And it created a ton of friction both internally and externally because Denham also believed that after Taft Hartley he - as the General Counsel - was the true nexus of power at the NLRB.

 

It led to tons of administrative disputes and one of the silly ones, but amazing, which I think is reflective of sort of where the board was in 1948, was the battle - what was known as "The Battle of the Bathrooms" and this received a ton of press in the Washington newspapers, that the board was moving headquarters and there was only one suite with a bathroom in the new building. Denham believed that he should get it. Chairman Herzog believed as the chairman of the board, he should get it. This was a battle royale that as I said, trickled over into the press, and in the end they just built two bathrooms. But what you saw was this kind of conflict that also arose in other ways. So for example, the General Counsel at the time believed that it was his job - that he's the only one that - as the board employee who represented the board in the courts of appeals, when a board order was on appeal, the general counsel didn't have an obligation to defend the board's position, that as the General Counsel, he could defend his own position that the board rejected. And this created a ton of controversy at the board, as you might imagine, again with these conflicting power centers where the board in the end ended up sending my predecessor, a woman named Ida Klaus, to go file briefs in the Sixth Circuit trying to strike the General Counsel's briefs as illegally filed.

 

And these were the sorts of power center issues that had to be sorted out. Ultimately, they were sorted out when President Truman fired - or asked for Denham's resignation, which he was given, but they also played out in the case processing as well. And I would point you most notably to a case from 1987 where the board had to figure out whether a General Counsel's unilateral settlement is a prosecutorial act - or settling a case over the objection of a charging party - is a prosecutorial act or an adjudicative act. And the board decided it was on the prosecutorial side of the house and that went up to the Supreme Court and the Supreme Court had to figure out, essentially look at the board's interpretation of the act, decide whether it was reasonable. I think it was an early case in which they applied Chevron to board decision-making and we're still dealing with this kind of power centric struggle. And I think John wants to talk about some pending matters implicating these issues.

 

Hon. John F. Ring: I'll just talk about it and I won't get into the - and I don't know how many other agencies have the structure the NLRB does, but there's not many. Yeah, I won't get into the day-to-day struggle of trying to administer an agency and run an agency where the chairman - I was chairman, so I would say the chair is actually the head of the agency - and by government standards it is, but the general counsel actually oversees what 80-something percent of the employees. And so it's - trying to run the agency is an interesting thing. But two areas that I think are interesting. One is what Fred mentioned.

 

Sometimes the general counsel and the board are not aligned either politically or philosophically. And we had cases now where Jennifer Abruzzo, the current General Counsel was going into court and defending cases that my board had issued knowing full well that she had no interest in enforcing our position. But it's one of those things that the General Counsel does - defend the board in court cases, I mean in court - after the board's decision. So it's one of those areas that is odd and again, a result of the Taft-Hartley Act's bifurcation of the agency. The other area interestingly is now starting to see some constitutional challenges and this involves the 10-J area where the General Counsel and the regions investigate unfair labor practices where the statute gives them and the General Counsel, the authority to kind of identify cases where immediate relief - injunctive relief is necessary.

 

But the General Counsel then brings that to the board and the board actually approves the General Counsel moving forward with a 10-J injunction. That's a whole process, but it is the board that does the approval of the 10-J that the General Counsel then goes into court and seeks the 10-J injunction. A year or two later, whether or not the General Counsel was successful in getting the 10-J, a year or two later, that case has worked its way through the process - has gone through an administrative law judge hearing decision has now been on exceptions to the board. The board is then sitting as an appellate adjudicative body deciding the case. 

 

So there are some questions, constitutional questions about exactly what Fred was talking about, prosecutorial versus adjudicative and here the board almost sits in both positions where the facts - as investigated without the benefit necessarily of what the employer in most cases might put out to defend itself - is brought to the board initially, the board then kind of in a prosecutorial - with its prosecutorial hat on - says "Yes, proceed with the 10-J" and then later it proceeds to get a case fully adjudicated and briefed with all the facts. I will say that there were times when I saw cases that had a 10-J at issue that got to the board and I questioned whether the board should find violations. And there's a back of your mind that's like, "Geez, the board obviously previously had decided that it was enough to go get a 10-J." So as I said, this is one of the issues that there have been some constitutional challenges at least asserted. And so that's something I think to watch.

 

Fred B. Jacob: Now, I would just throw out that the board has addressed a similar argument in the recusal context recently where a party asked two members to recuse themselves from the adjudicative stage because they had participated in the 10-J vote, and that's a case called NP Red Rock, where the board denied that or the members denied that request to recuse themselves, basically citing a fair amount of Supreme Court and NLRB precedent that recognize that in the adjudicative context there are many cases in which the Congress has vested some form of adjudicative and prosecutorial authority in the same body.

 

So that's out there. I believe that case is under review probably. I think there's a petition for review pending in it. So we'll see if that issue gets raised to the court. I mean a lot of these arguments we'll be talking about the Supreme Court has rejected in Jones & Laughlin in 1937, but everything old is new again it seems these days, so we'll see what the courts - how they find it. I think it's interesting, John, I was listening to your description of the challenge of being a board member and I've never had to be in that seat, but it did strike me as it's sort of a judge having to decide a preliminary injunction. It's the same kind of thing - we have to put on two different hats. And so on a preliminary injunction you're deciding like, well, is there enough likelihood of success on the merits? But then the trial could show something totally different when the facts come out.

 

Hon. John F. Ring: Right. The only difference there is the judge in the preliminary injunction gets both sides and here you really are just getting the prosecutors' slant on the thing, but it is similar. Yeah.

 

Fred B. Jacob: Interesting. I think we're going to pivot to talking about employer speech a little bit, which is a very interesting area. Hot topic. Congress enacted Section 8-C in Taft-Hartley. Section 8-C was a reaction to the fact that under the Wagner Act, the Wagner Act board originally insisted on a fair amount, if not strict neutrality from employers in the course of representation elections. And a lot of this was the reaction I think to the really severe employer domination of the process that had been the norm prior to the Wagner Act's enactment and the protections of Section Seven and Section Nine and the provisions of Section Nine that provided for representation elections by a majority rule. So in these early cases, you see a fair amount of hints suggesting that just mere employer speech - saying they didn't want unionization - could potentially interfere with employee choice.

 

And there's lots of debate on this to this very day, but the Supreme Court in a case called Virginia Electric and Power Company - NLRB v. Virginia Electric and Power Company in 1941 pushed back on this and essentially said to the board that employer speech can be the basis for an unfair labor practice, but it needs to be in a broader context, it can't be merely about the expression of views. The quote is that the act doesn't prohibit the employer from expressing its view on labor policies or problems, nor is a penalty imposed upon it because of any utterance in which it's made. So it essentially stands for this principle that mere speech, mere expression of opinions can't be the basis for an unfair labor practice. Now Taft-Hartley essentially incorporated the language you see on your screen and sort of the principles that were enunciated in Virginia Electric and Power Company into the act itself, the Supreme Court in the Gissel case said that it essentially incorporates First Amendment principles.

 

It doesn't incorporate the First Amendment wholesale, but it incorporates First Amendment principles. The Supreme Court said that in Gissel, repeated it in Brown v. Chamber of Commerce, which is another preemption case that implicated speech issues. But as you can see, what Congress said here is very plain: "The expressing of any views, argument, or opinion or the dissemination thereof shall not constitute or be evidence of an unfair labor practice under any of the provisions of this subchapter" with a proviso, that it's only if such expression contains no threat of reprisal or force or promise of benefit. And that preserves the cases that existed prior to Taft-Hartley and after - and supports the cases that it came after Taft-Hartley that say that employer speech is permitted, but employer speech that is threatening is not, or that promises - essentially promises a benefit or attempts to bribe employees is not permitted.

 

The board's job under the delegation given by Congress in the act is to figure out what is a threat and what is a promise of benefit. So in the Gissel case in particular, the Supreme Court examined the board's law about predictions of plant closure and predictions of financial ruin and came up with a test to figure out how do we balance an employer's legitimate right to say, "I think the repercussions of choosing unionization might be negative" in one way or another, without it being construed as a threat. And the court adopted the board's test that essentially said you have to show some demonstrably probable consequences that it can't be just mere idle speculation that it has to be based on some sort of probable consequences. And so that's the dividing line for the board and the Supreme Court in Gissel, again, I'm simplifying things so please don't write me with all the sites saying that I've spoken to broadly. So I know John wants to talk a little bit about 8-C because it's a super hot issue right now and the board is considering some really important 8-C cases.

 

Hon. John F. Ring: So I'll just say as a board member and anybody who reads board cases, you know that this issue that Fred's been talking about, what is employer speech that contains a threat or reprisal or promise of benefit. I mean, and there's lots of cases and a lot of inks built on exactly what that looks like. We've kind of turned a corner here where the current NLRB General Counsel has taken the position that employer speech about Section Seven activity, which generally covers union activity or workplace issues, any employer speech during paid time is a per se violation of the act. And the argument goes that the employer, sorry, the employees in the workplace have a Section Seven right to refrain from listening to employer speech. And that's even where the employer is not threatening or promising benefits. And the General Counsel has contended that that speech is an inherent threat. It's inherently a threat because a threat of reprisal is unmistakably present - this is her words - unmistakably present whenever an employer requires employees to listen to a message concerning Section Seven activity. And that was put out in a general counsel memo in April of 2022.

 

And I should say while this interpretation has generally been talked about in terms of so-called captive audience speeches, which are usually meetings held during an organizing campaign where the employer brings in employees on paid time and gives the employer's view of unionization and whether the employer favors it or not, the General Counsel has gone beyond that and is advocating for not just when employers convene employees on paid time, but also is saying that it's per se unlawful for supervisors or managers to so-called corner employees while performing their job. So that's the overall description that the General Counsel has put forward here, I mean it virtually covers all time employees spend in the workplace. So it really effectively shuts down employer speech to employees in the workplace about any kind of Section Seven activity.

 

As Fred kind of talked about it, the General Counsel's position is very difficult to square with the Taft-Hartley provision of Section 8-C and the First Amendment, 8-C affirmatively protects the expression of union-related views, arguments and opinions. And as Fred mentioned, in the Chamber of Commerce v. Brown case of 2008, the court said that 8-C implements the First Amendment and reflects the policy judgment in the NLRA favoring uninhibited, robust, and wide-open debate in labor disputes. And interestingly, Fred mentioned some part of the legislative history, but the legislative history of 8-C demonstrates that the provisions that were included in the Taft Hartley amendments were really designed precisely to reverse something that the General Counsel is pursuing here and a 1946 NLRB case named Clark Brothers, the General Counsel had in that case, the board had said that because of an employer's superior economic power and their ability to control employee's actions during working hours, that it meant that the company's was inherently coercing its employees by forcing them to listen to the employer.

 

That case was something that the Taft-Hartley drafters took into account and then of course immediately after the Taft-Hartley Act passed, the Supreme Court in Babcock & Wilcox acknowledged that the pre-Taft-Hartley compulsory audience theory, the idea that non-coercive employer speech was a per se violation no longer exists as a basis for an unfair labor practice. So there are clearly some headwinds I think to the General Counsel's theory, which of course may be why the board has not acted on any of the cases that she's advocated for this prohibition on employee speech yet. I think the board is going to have a hard time getting around the realities of the statutory language, legislative history, and the Supreme Court precedent. But in the meantime, the General Counsel has continued to pursue this theory. She's bringing unfair labor practices charges and she's using the threat of prosecution to I think alter employer conduct. A number of employers have opted for just voluntary meetings to avoid the unfair labor practice risk and then in many cases using this threat as a way to force a settlement that extracts settlement terms that can sometimes be beyond what the act requires. So that's where we are with 8-C.

 

Fred B. Jacob: So I just want to clarify that I don't take any positions on captive audience or on the issues that are there. I would say that if you're interested in reading a board decision that discusses some of these issues from the other perspective, Member Becker in 2011 wrote a long dissent in a case called Two Sisters Food Group where he addressed some of these issues and they're certainly engaged and joined before the board now. And I think there's a lot of really interesting reading out there to see how they play out. And I believe, I apologize John, if you said this, the General Counsel is proposing that there have to be some sort of assurances right, it can't be mandatory, it can be voluntary?

 

Hon. John F. Ring: Yes, but the General Counsel's position is that you have to have a - I think it's about a third of a page long Miranda rights in order to make it truly voluntary - I don't know if that a lot of employers have been doing that, but they've at least given, they've at least said "You can leave if you'd like to." But yes, there is that ability to give the employees the opt-out. Yes.

 

Fred B. Jacob: Great. All right. We're going to quickly, we're going to talk about Section 10-C of the act next. If I can get the thing to go. "No order of the board shall require the reinstatement of any individual as an employee who has been suspended or discharged or the payment of any back pay if such individual was suspended or discharged for cause" I assume we have, the folks on the call are mostly labor and employment lawyers. So you're familiar with mixed motive cases and this is sort of trying to figure out what this means for mixed motive cases, right? Direct evidence cases are easy, they're easy peasy if the evidence comes out that the employer or the unions - this applies to union discrimination and it applies to concerted activity discrimination - but if the evidence comes out that there's a direct statement of "I fired this person because I'm trying to squelch the union campaign." That's an easy case, right? Direct evidence. But what do you do when they're mixed motive cases and the employer may be acting for both anti-union reasons and for reasons that would be otherwise legitimate?

 

And what does this section mean? So this section came out of a perception that Congress had that essentially employers or employees could use their union activity as a shield to essentially prevent idleness on the job. The Supreme Court addresses this in the Fibreboard case, and this is sort of how the Supreme Court has interpreted this act, this provision. So in Fibreboard, which was all about whether an employer has to bargain over subcontracting, the employer said "Even if we did have to bargain over subcontracting, we fired these employees for not for union animus, it was just because we had subcontracted out the work." And so therefore they were fired with just cause, they were fired with legitimate cause.

 

And the Supreme Court came back and basically said, "Look, this section was about preventing people from using Their union affiliation to avoid being terminated for otherwise legitimate reasons. But here in the subcontracting case what we have is you refuse to bargain over subcontracting and the direct result of that was that These employees lost their jobs. So it's legitimate even though it's also legitimate to bring them back." And it arises in the discrimination - and it often comes up in, where it comes into play is like in the Weingarten context where, and the board has fought over this, but I think the current law is that if an employer denies an employee of their Weingarten rights but fires them for the offense that they were investigating, which was unrelated to their union activity, they don't have to reinstate them, Section 10-C prevents reinstatement.

 

It mostly comes up, it is a huge factor in Wright Line. It's why the board has ended up with the mixed mode of analysis in Wright Line that basically breaks the analysis for discrimination into two parts, the General Counsel proving that union animus motivated the unlawful employment action, and then the general, the employer has the opportunity to come back and say "We would've taken the same action even in the absence of the employee's activity." And that also protects the 10-C right to reinstate if someone's been fired with just cause it's actually really fascinating area as I started to dig into it because it seems, again, if you're looking at the plain language, you would say "If there's any legitimate reason to fire somebody they shouldn't be reinstated." But that would eviscerate section 8-A-3, which prevents discrimination and essentially says that employers can't target employees because of their union activity. So the board has reconciled this in a variety of ways. It's coming up in some current litigation that I think John's going to talk about.

 

Hon. John F. Ring: Yeah, so just quickly, this is an area I think where the board has staked out an interpretation of the act and one that has been in place for a while where the interpretation is that this 10-C for-cause proviso simply does not apply where there is evidence of union animus and the Wright Line test tries to address that, but ultimately where the General Counsel can prove that there was protected activity, there was knowledge of that protected activity by the employer and animus, the burden then shifts to the employer to show that they would've taken - this is the Wright Line analysis - that the employer wouldn't have taken that action or would've taken the action regardless of the protected activity. And that burden on the employer to do that I think could be argued as it's not necessarily the employer's burden and it's often difficult to meet the board's standard for consistent prior action.

 

So the test is subject to some scrutiny and I think the board's overall acceptance of the Wright Line test, the whole mixed motive standard has historically been based on the court's deference to the NLRB's interpretation, and the board to date has continued to justify its interpretation based on that deference.

And I should say I think there have been some courts that have expressed some skepticism about the board's interpretation in light of the statutory language. I will mention that there is a cert petition pending in a very interesting case that I participated on when I was at the board that raises this issue. The case involves a New York Presbyterian hospital that terminated a nurse who left an operating room in the middle of surgery to attend a union protest. Nothing can go wrong there, right? The board over my dissent put the nurse back to work despite some circuit court cases - pretty old circuit court cases - expressly talking about how the protections of the act could be lost. And they talk about the fact that what would be the most egregious situation, maybe a nurse walking out of an operating room in the middle of surgery. This is a cert petition and New York Presbyterian Hospital is asking for, among other things, the court to look at the board's interpretation of 10-C. So this should be interesting to watch and I think interesting facts if this Supreme Court wants to dig into this area.

 

Fred B. Jacob: And I would just point out to everybody that the board - I believe the op cert is due in mid-August. So if you want to see how the board responds to the cert petition, it'll be available at that point and available on the board's website, and I think the Supreme Court's website too. Alright, lastly, and I think we wanted to talk a little bit about secondary activity and the "Scabby the Rat" cases. I would put the statutory text on here, but it is somewhat inscrutable and so it would confuse everybody as much as it confuses me every time I look at it. But at a very high level, one of the issues that Congress was really concerned about in Taft-Hartley was making sure that neutral employers were not sucked into a union's dispute with their primary employer and that the public was - in two ways rather - so that neutral employers were not sucked in two ways.

 

One, by having their employees be encouraged to strike against them to support the objective of a union trying to get at a primary employer and two, by a union trying to restrain, coerce or threaten the public or anybody else from doing business with that neutral employer to put pressure on the primary employer. So the classic case from the Supreme Court in the mid-eighties was a case called DeBartolo that involved a contractor in a mall in Florida the union had a dispute with the contractor and it put up, it was hand billing outside the mall telling people that there was this dispute and encouraging them not to patronize the stores in the mall. 

 

Had they been picketing, that would've been unlawful, had they been trying to encourage employees not to go to work, that would've been unlawful, but under the circumstances of DeBartolo, what they were trying to do was just encourage the public not to patronize the mall and the Supreme Court held - in agreement with the board, I believe - that this is protected by both - that the act doesn't prohibit that, both primarily as a matter of constitutional avoidance because ultimately when a union communicates in that way with the public to try to encourage them not to patronize a third party - a neutral to put pressure on their target - that's persuasion. And so the line is between what's persuasion and what's coercion. If something falls on the coercion side of the line, they can't coerce the public into doing it. But if it's mere speech and persuasion they can. And this has raised a number of questions involving our friend Scabby the Rat who is this six-foot inflatable that is often found at various construction sites and other places, including once - I think when you were Chair, John - outside the Board, I was trying to find that picture but I couldn't find it. Anyway, I know you wanted to talk about the Lippert case which was issued while you were chair.

 

Hon. John F. Ring: Yeah, so as Fred said, this is an area where ever since Taft-Hartley was enacted, there's been a struggle trying to find that line between what is union persuasion and what is expressive activity, free speech protected by the First Amendment and prescribed secondary threats, coercion or attempts to restrain. And admittedly it's not an easy line to draw, but I will say that this is one of those areas in fairness, in a balanced way, this is candidly an area where I think - an unusual area - where employers have been pushing the envelope to try to expand an interpretation of a provision of the act here, trying to expand the interpretation of 8-B-4 to prevent some union pressure directed at secondary employers. And sometimes they're doing so where there may not be the requisite level of threat, coercion, or restraint. I know there are probably people on the call who are not going to agree with me, but this is an area - and we've seen it in the Scabby the Rat cases and Scabby is as menacing as it looks and was when it was outside the NLRB. But when I was on the board we had this issue in a case involving Lippert and the NLRB.

 

We requested a briefing and many in the employer community wanted to basically kill Scabby the Rat - wanted to say that the Scabby tactic for bringing a menacing inflatable rat when used against an employer that was not the primary employer in the primary dispute was unlawful secondary pressure. And the board majority, and again that I participated in, concluded that it was not unlawful secondary pressure. And although we noted that it could be a fact-specific inquiry depending on whether there was threat, coercion, or restraint, and if Scabby was blocking the entrance to a secondary establishment, that obviously would be a different situation. The facts in Lippert - the case that we decided - Scabby was sitting out, just persuading, making known that there was some disagreement from the union with the secondary employer who was doing business with the primary, the dissent in that case was a very good Federalist Society member by the name of Bill Manuel - we argued about this for a long time - he argued that Scabby the Rat was scary and off-putting enough that it would be a threat or it would coerce employees into not dealing with a secondary employer. So there's debate, I think what I was concerned about and I think based on the Supreme Court precedent and particularly that DeBartolo case that Fred mentioned, that we could find ourselves with a case going to the Supreme Court where the court could put - I think take a different position and really restrict 8-B-4 even more so than it already is or place some significant restrictions on the overall secondary limitations.

 

Fred B. Jacob: I think we're out of time. Marco? Yeah, let me, I'm going to stop sharing. I'm happy to stay on a little longer to answer questions if people have them.

 

Hon. John F. Ring: I saw one question, Marco, it is a good question and that is what's the role of the Solicitor? And it's a good question because I didn't know either before I started on the board and it seemed like you have a Solicitor, you have a General Counsel, you have a - and Fred, you can correct me, but the Solicitor is solely on the board side and because of Taft-Hartley there is a board side and there's a General Counsel side and there really is a very, very strict wall between the two. And the Solicitor is the board's lawyer. So issues that range from process procedure to ethics - which I'm sure Fred was happy to deal with - and to really advise on substantive case law. The Solicitor also interfaces with appellate courts when they're taking our cases to court. So I was always on Fred when Jennifer was arguing our cases in court just to make sure that they were good. Not that I had any doubts that they would be, but anyway, it really is a very, very important function I've found. Fred, do you have any more to say?

 

Fred B. Jacob: I feel very lucky to be in this job. My position description says I am the chief legal advisor to the five-member board and as somebody who spent most of my career as a civil servant at the NLRB, it's a really wonderful place to because you're here to protect the institution. What I do every day, I always say I do whatever the board wants me to do. I'm like any in-house counsel. So if you're in-house counsel to a corporation one day you could be dealing with corporate governance documents, the next day you could be dealing with outside employment litigation, the next day you could be dealing with corporate ethics. And that's what I do for the board. So whatever pops up, whether operational, or internal, and then I interface on behalf of the board with the General Counsel. That's why this position was created right after Taft-Hartley to be a single voice that can interface with the General Counsel on federal court litigation for example, or on FOIA or on ethics issues or whatever when the board needs someone to kind of translate the board side to GC side. That's part of our job too. And then occasionally I get to come talk to folks like you, which also makes me really happy and be a cheerleader for the NLRB because I think we're all doing really great work here. It's important to unions and employers and workers and so I appreciate you guys letting me come and give you my spiel.

 

Hon. John F. Ring: I appreciate you.

 

Marco Lloyd: Well, that seems like a fantastic note to end it on. Thank you both for that amazing presentation. And thank you also to our audience for joining us. We greatly appreciate your participation. Please check out our website fedsoc.org or follow us on all major social media platforms @FedSoc to stay up to date with announcements and upcoming webinars. Thank you once more for tuning in and we are adjourned.