Government Year-End Update - American Society of Employers - Anthony Kaylin

EverythingPeople this week!

EverythingPeople gives valuable insight into the developments both inside and outside the HR position.

Latest Articles

Government Year-End Update

regulatory updatesAlthough it would be expected that the ending of the year should be a quiet one, the Biden administration is going out with a bang that will cause some heartache for employers.  Below is a listing of some of the changes to expect going forward.

  1. Budget approval

Congress is working on an omnibus bill for government spending in 2023.  Currently, the government is running on a Continuing Resolution until the end of the week. The new spending bills are expected to be completed on December 23rd and approved.  The omnibus package has a $1.7 trillion price tag, with Democrats and Republicans agreeing to $858 billion in defense spending.  

There is no word as to how the spending bills are being allocated.  If the spending levels for the various agencies are maintained at current levels, enforcement of regulations will be difficult, and some agencies may have to have layoffs while others cannot obtain headcount.  If increased, 2023 will be a year of regulatory enforcement. 

  1. National Labor Relations Board (NLRB)

The NLRB has come out with three major policy shifts through cases in the past week or so.

  1. Investigations

The NLRB is being very aggressive with investigation interviews.  In Sunbelt Rentals, Inc., Case Nos. 18–CA–236643, 18–CA–238989, and 18–CA–247528, the NLRB recognized certain safeguards when an employer is conducting interviews in an investigation: (1) the employer must communicate to the employee the purpose of the questioning, assure the employee that no reprisal will take place, and obtain the employee’s participation on a voluntary basis; (2) the questioning must occur in a context free from employer hostility to union organization and must not itself be coercive in nature; and (3) the questions must not exceed the necessities of the legitimate purpose by prying into other union matters, eliciting information concerning an employee’s subjective state of mind, or otherwise interfering with the statutory rights of employees.  This approach follows board precedent.  However, the NLRB went further and stated that any violation of this approach is a per se violation. 

“Because of the strong possibility of coercion in an employer interview about unfair labor practice issues, employees need protection,” NLRB Chairman Lauren M. McFerran stated in a press release. “This familiar, bright-line test is easy for employers to comply with and brings certainty to the administration of the Act.”

Therefore, when conducting interviews for investigations, HR needs to be very strict in how to approach the interview, and train themselves and other HR employees to do it right, otherwise liability will attach to the company for failure to follow the approach.

  1.  Micro-units

In American Steel Construction, Inc., the NLRB has overturned the traditional standard for units to organize under PCC Structurals and Boeing, Inc., and has returned to the “overwhelming community of interest” standard that was articulated in Specialty Healthcare during the Obama administration.

Specifically, the NLRB states that “a community of interest between the petitioned-for and excluded employees . . . must make a heightened showing to demonstrate that the interests of the petitioned-for and excluded employees are so similar that the petitioner is seeking, in essence, an arbitrary segment of an otherwise appropriate unit. In other words, the interests of the petitioned-for and excluded employees must ‘overlap almost completely’ to mandate inclusion.”

In other words, unions will now be able to organize smaller groups of employees within the company, even if a larger employee group may be more appropriate for the organizing. 

  1.  Unions on property

In a 3-2 decision last Friday, a majority said that owners may only kick contractors' workers off their property when the workers' activities "significantly interfere" with the use of the property, or where the owner has "another legitimate business reason" to remove them. The NLRB found the Bexar County Performing Arts Center violated federal labor law by barring workers for the San Antonio Symphony from leafleting on its property, reversing the board's 2019 ruling that workers must "regularly and exclusively" work on a property to be entitled to protest there.

"In the absence of that significant interference, or another legitimate business reason of the property owner, it ensures that off-duty contractor employees — like all other statutory employees — are able to realize the rights granted to them under Section 7 of the act," the majority said.  (Bexar County Performing Arts Center Foundation, case number 16-CA-193636, 12/16/22)

The dissent believed that this decision essentially overrules the U.S. Supreme Court's 1992 ruling in Lechmere Inc. v. NLRB , which limited the power of union organizers to access property where they are not employed. 

In other words, union employees not working at the location being organized may be permitted to distribute leaflets or talk to employees as they enter or leave without worrying about any employer blocking action. 

  1.  Make whole relief

The NLRB in Thryv, Inc., ruled that it will add compensation “for all direct or foreseeable pecuniary harms” to its customary “make-whole” remedy, which typically has consisted of back pay along with reinstatement. To do so, the NLRB will consider “all direct or foreseeable pecuniary harms” in any case that calls for relief to make employees whole for unfair labor practices, not just egregious violations. According to the Board, “direct or foreseeable pecuniary harms” could cover items such as “out-of-pocket medical expenses, credit card debt, or other costs simply in order to make ends meet.”

Therefore, employers could have more costly NLRB hearings, an unfair labor practice (ULP) bifurcated between the ULG itself and damages as a second hearing.  There is still a question whether the NLRB has this authority, but this is the expectation for the next two years with a divided congress that the regulatory agencies will be highly aggressive interpreting their powers and authority.

  1. U.S. Department of Labor Wage and Hour

As reported previously in EPTW, the U.S. Department of Labor filed preliminary regulations for the standards to determine the Independent Contractor status.  These rules would essentially embody the California ABC test, disallowing any independent contractor arrangement while making all contractors employees of the company.  50,000 comments were received.  ASE will report on the final rules once they are promulgated, although it is expected this rule will be taken to the courts.

HR should be aware that if these rules and actions are contested, it will likely go up to the DC Circuit.  Many of these may have to be heard by the Supreme Court to have a finality to the situation.  Unless these and other contrary employer actions are suspended awaiting hearings, it will be an interesting time for short-staffed HR to navigate.

 

Source:  Social Current 12/19/22, Littler 12/16/22, Shawe Rosenthal LLP 12/14/22, 12/15/22, Law360 12/16/22

Filter:

Filter by Authors

Position your organization to THRIVE.

Become a Member Today