Minnesota Employment Law Report - Observations on labor and employment law from FLFV

The National Labor Relations Act calls for the National Labor Relations Board (the quasi-judicial body that decides cases, and that also has certain rulemaking authority) to consist of five members, but the Board does have the power and authority to issue decisions at times when it has only three members.

The Board, however, does not have the authority to issue decisions (or adopt new rules) with only two members. This was the conclusion that the Supreme Court reached in June of 2010 in New Process Steel, LP v. NLRB, 130 S. Ct. 2635 (2010).  The New Process Steel case was the culmination of a 27-month period from January of 2008 to March of 2010 during which the Board issued hundreds of decisions with only two members, and it created quite a fallout.  In any case, it is now settled that the Board cannot decide cases or engage in rulemaking any time that it is down to only two members.

Most recently, the Board has consisted of three members – Mark Pearce, Brian Hayes, and Craig Becker.  However, Craig Becker’s term expired at the end of the last session of the Senate, at approximately noon on January 3, 2012.  This reduced the number of Board members to two.

Members of the Board are nominated by the President, subject to the consent of the Senate. Thus, generally speaking, the President is supposed to nominate individuals to serve as Board members, and the Senate is supposed to confirm them before they can actually be appointed. There is, however, an important exception.  When the Senate is in recess, the President may temporarily appoint a Board member without Senate approval, and this is termed a recess appointment.  (Member Becker was, in fact, a recess appointment.)

On January 4, 2012, President Obama announced his intent to recess appoint three individuals as Board members – Sharon Block, Terence Flynn, and Richard Griffin.  These recess appointments would bring-up the number of Board members to five.

The President’s use of the recess appointment process in this case is not without controversy.  Republicans have accused the President of abusing recess appointments by placing controversial individuals into high-ranking positions without the approval of the Senate.  Accordingly, Republican lawmakers have attempted to block recess appointments at this time by holding pro forma sessions in an effort to avoid a recess of more than three days.   The Department of Justice under President Clinton previously opined that a recess has to last for more than three days to permit a valid recess appointment, although the Supreme Court has never ruled on the issue.  In this case, the Senate met on January 3 and is scheduled to reconvene on January 6 – a recess that is too short for making recess appointments, if this is indeed the requirement.

Apart from the three Board members, the President on January 4 appointed Richard Cordray to lead the Consumer Financial Protection Bureau. It remains to be seen whether more recess appointments will follow.  In any event, we anticipate that there will be legal challenges to the President’s authority to make recess appointments in these circumstances.

On a final note, by tradition, the Board (when at its full complement of five members) has consisted of three members from the President’s own party, and two members from the other major political party.  In this case, Mark Pearce (the current Chair), Sharon Block, and Richard Griffin are from the Democrat side, whereas Brian Hayes (the other current member) and Terence Flynn are from the Republican side.  Thus, this collection of five Board members would match the traditional balance.  However, with a majority of three members on the Democrat side, we expect that the Board would continue to issue decisions that many people view as unfavorable to the business community, and that it would also continue to push for controversial changes to the union election process.

Attorney Jessica M. Marsh contributed to this report.

On December 23, 2011, the National Labor Relations Board announced that it is delaying implementation of its new rule which requires employers to post a notice of employee rights under the National Labor Relations Act.  The rule was scheduled to take effect on January 31, 2012.  The new effective date of the posting requirement is April 30, 2012.

The Board has agreed to delay the posting requirement at the suggestion of the Federal District Court in the District of Columbia.  The Court is currently considering a pending lawsuit challenging the legality of the new rule.  While the Agency has argued that the posting requirement is a mere statement of employee rights under the law which the Board is empowered to enforce, opponents claim that the posting requirement is outside the Board’s grant of authority from Congress.

If the Court does not enjoin the rule, employers will be required to comply with the posting requirement starting on April 30th.  Note that this is the same day that the Board’s new procedures for representation cases are scheduled to go into effect.  (An article on that topic is available here.)

This is the second time the Board has delayed the implementation of the new posting rule.  The first delay was on the Board’s own initiative and was intended to give employers more time to prepare for the implementation process.  (See our previous report that is available here.)

The posting rule may or may not survive legal challenge.  For now, however, there is no urgency in clearing off that bulletin board space or uploading a copy of the notice to your intranet page for employees.  April 30th is the earliest date on which compliance will be required.

Stay tuned for further developments.

At present, there are as many as 25 million workers age 18 to 64 who do not have a high school diploma or a General Educational Development (GED) equivalent.  Many employers – likely without even thinking – include a diploma requirement as part of their standard set of qualifications for a position.  But, a recent Informal Discussion Letter from the Equal Employment Opportunity Commission (EEOC) should cause employers to think carefully before including such a requirement.

In its letter, the EEOC points out that “some individuals cannot obtain a high school diploma, and therefore cannot obtain jobs requiring a high school diploma, because their learning disabilities caused them to perform inadequately on the end-of-course assessment.”  As a result, a diploma requirement may have the effect of screening out individuals with learning disabilities.

Under the Americans with Disabilities Act (ADA), “a qualification standard, test, or other selection criterion, such as a high school diploma requirement, that screens out an individual or a class of individuals on the basis of a disability must be job related for the position in question and consistent with business necessity.”   A qualification standard is “job related and consistent with business necessity” if it accurately measures an applicant's ability to perform the fundamental responsibilities of the job in question.

But, that measure is simply the first of two steps.   Once it is determined that the qualification standard being used to screen out applicants is job related and consistent with business necessity, the employer also must show that an individual who does not meet that standard is unable to perform the essential functions of the job, even with a reasonable accommodation.

The EEOC suggests the following accommodations in its letter: (a) “considering relevant work history” and/or (b) “allowing the applicant to demonstrate an ability to do the job’s essential functions during the application process.”  But, in the end, the EEOC makes clear that the employer is by no means required to prefer a learning disabled applicant over other applicants who are better qualified.

Bottom Line

While this is not an official opinion letter from the EEOC, it should cause employers who automatically include a high school diploma as a baseline requirement for positions to reconsider the business necessity of this requirement.  Moreover, even where the diploma requirement is job related and consistent with business necessity, employers need to be prepared to accommodate learning disabled applicants who lack a diploma, but who are capable of performing the essential functions of the job.

The letter does not address whether the EEOC will go so far as to require employers to affirmatively notify applicants that the employer will accommodate applicants who lack a diploma. Otherwise, learning disabled applicants would likely not apply to a position where a diploma is required.   Further guidance is needed to clarify this issue.

‘Tis the season for questions about holiday parties and the associated risk of having one.  Beyond deciding what to call the party, employers are often concerned about potential fallout from parties – in particular, “If my employee is injured at the party, is the company on the hook for work comp benefits?”  The worry can be enough squelch the festive mood.

Minn. Stat. § 176.021, subd. 9, provides that injuries incurred while participating in voluntary recreational programs sponsored by the employer, including health promotion programs, athletic events, parties and picnics, do not arise out of and in the course of employment.  The exceptions typically are: (1) When an employee is ordered or assigned by the employer to participate in the program or activity; or (2) When the employer-sponsored party is intended to serve some other business objective, i.e. promoting goodwill or marketing between the employer and its customers.  In these circumstances, the injuries sustained are generally covered by the Workers’ Compensation Act.  Sometimes it can be hard to determine what is truly “voluntary” when it comes to the company holiday party.

Case in point, in Boraas v. Strand-Saboe VFW #5247, the employer would host an annual Christmas party for employees and their guests (no customers).  An employee slipped and fell while dancing with a coworker at the party and the judge found, and the appellate court agreed, that because the attendance was not “entirely voluntary,” the employee’s injury was covered under the Act.   The evidence showed that there was a notice and sign-up sheet for the party, and that the employer questioned employees who were not signed up to obtain a reason for not attending.  Further, the employees who decided not to attend, though not disciplined, were subject to sarcasm and ridicule.  At the party, there was an attendance/sign-in sheet and the employee testified at hearing about the overall importance placed upon the employee’s attendance by the employer and her belief that she was expected by the employer to attend the function.  These facts were sufficient to make the Christmas party injury compensable under the Act.

Say you want to forego the party and just give out the holiday ham or turkey – that’s safe, right?  Not necessarily.  An employee who had been on a leave and received notification that she could come to pick up her holiday turkey, and then slipped and fell in the parking lot, was held to have a compensable injury.  The court likened it to situations where an employee is injured on the employer’s premises while picking up a paycheck.  It appears that the enticement of the “turkey bonus” was an anticipated benefit on the part of the employee and attributable to the employment relationship and the injury sustained while collecting the turkey was covered under the Act.

Bottom Line

You don’t have to be like Scrooge and ban the holidays from work, just remember that when it comes to parties, do not require and police attendance – voluntary must be voluntary.  And, if you are giving your employees the holiday goose, turkey or ham, think about sending them a gift card instead.

On November 9, 2011, NLRB Region 18 in Minneapolis issued a Complaint against Jimmy John’s, alleging that six employees were unlawfully discharged in March for engaging in Union and other concerted and protected activities.  The concerted behavior at issue included the employees distributing hundreds of flyers which suggest that Jimmy John’s customers might be eating sandwiches prepared by sick workers (because Jimmy John’s apparently does not provide paid sick time).

The employees filed an unfair labor practice charge with the NLRB, alleging that they were unlawfully terminated for engaging in what they viewed as concerted and protected activity under the National Labor Relations Act (NLRA). Jimmy John’s argued that the distribution of these flyers was not protected by the NLRA.

Region 18 submitted the case to the NLRB’s Division of Advice in Washington, D.C., for its opinion on whether the flyers were protected (in which cases the discharges were unlawful), or whether the flyers were so disloyal the employees lost any protection under the Act (in which case the discharges were lawful). The Division of Advice has taken the view that the employees’ conduct was protected by the NLRA, although it has not released its legal analysis in support of this position.

The NLRB complaint is the first stage in the formal litigation process. If the case does not settle, it will come before an NLRB Administrative Law Judge on January 17, 2012.

Bottom Line

Even though these flyers might have made customers think twice before ordering a sandwich, the NLRB is taking the position that Jimmy John’s could not lawfully discharge the employees for distributing them.  Employers should be extremely cautious when considering whether to discipline or discharge employees who are complaining about their working conditions, even if the employees are making the Employer “look bad.”