Wyatt Employment Law Report

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Court Rejects NLRB’s D.H. Horton Decision Invalidating Limits on Class Arbitration

By Edwin S. Hopson

The U.S. Court of Appeals for the Fifth Circuit in a split decison in D.H. Horton v. NLRB, No. 12-60031, decided December 3, 2013, rejected the NLRB’s ruling that an agreement between employees and Horton requiring arbitration and prohibiting class or collective actions in arbitration was a violation of the National labor Relations Act.  That agreement also required that all employment related disputes be resolved individually through arbitration.  The Board panel of Pearce and Becker (Hayes had recused himself) had concluded that prohibiting employees from pursuing class or collective action claims in arbitration infringed on substantive rights under Section 7 of the Act. It also held that the agreement discouraged employees from filing charges with the Board.

The court in rejecting the Board’s position on class or collective actions focused on the Federal Arbitration Act which favors arbitration.  After a detailed analysis of the NLRB’s arguments as to why the NLRA should govern, rather than the FAA, the court concluded that the Board’s arguments lacked merit.  However, the court did enforce the Board’s order pertaining to discouragement of employees from filing charges with the Board.

The court also rejected challenges to the underlying Board decision based on the invalidity of Member Becker’s recess appointment and the timing of the expiration of his recess appointment.

The full text of the decision can be found at:


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NLRB Finds Requesting an Employee Not to Talk to Other Employees During an Investigation to be a Violation

By Edwin S. Hopson

In Banner Health System d/b/a Banner Estrella Medical Center, 358 NLRB No. 93 (2012), decided July 30, 2012, the NLRB in a 2-1 decision (Members Griffin and Block in the majority, and Member Hayes dissenting), held that an employer representative who was conducting a workplace investigation violated employee Section 7 rights by telling the complaining employee not to discuss the matter with other employees while the investigation was pending.

The NLRB administrative law judge hearing the case stated in his decision:

“During the hearing, General Counsel amended the complaint to allege that Respondent’s confidentiality agreement and interview of complainant form violates Section 8(a)(1) of the Act. The interview of complainant form is not given to employees. During interviews of employees making a complaint, [employer representative] Odell asks employees not to discuss the matter with their coworkers while the investigation is ongoing. I find that suggestion is for the purpose of protecting the integrity of the investigation. It is analogous to the sequestration rule so that employees give their own version of the facts and not what they heard another state. I find that Respondent has a legitimate business reason for making this suggestion. Accordingly, I find no violation.” 

The Board panel majority reversed the ALJ and nevertheless found a violation.  In dissent, Member Hayes stated:

“Contrary to my colleagues, I would affirm the judge’s dismissal of the allegation that the Respondent promulgated an unlawful work rule prohibiting employees from discussing matters related to an ongoing investigation. It is axiomatic that, to violate the Act, an employer’s work rule must be an actual work rule with binding effect on employees.  [Citation omitted].  Here, … the Respondent did not promulgate any rule at all. It merely suggested that employees not discuss matters under investigation. I therefore respectfully dissent.”

It would appear that the Obama Board is now reaching into areas previously thought to be safe ground by HR managers.  Whether the courts will enforce such decisions remains to be seen.

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NLRB Requests Additional Briefing in Case Involving University Faculty

By George J. Miller

On May 22, 2012, in long standing case involving Park Point University in Pittsburgh, a three member majority of the National Labor Relations Board issued an invitation for briefs from interested parties on the question of whether private university faculty members seeking to be represented by a union are employees covered by the National Labor Relations Act or, instead, are managers who are excluded from the Act’s coverage.  Specifically, the NLRB is requesting briefs on eight questions, including which factors previously identified by the U.S. Supreme Court as indicia of managerial authority of faculty members are “most significant in making a finding of managerial status for university faculty members and why,” and whether “the factors employed by the Board in determining the status of university faculty members properly distinguish between indicia of managerial status and indicia of professional status under the Act?”

The two Republican members of the Board, Members Hayes and Flynn, objected to the issuance of this request, pointing out that the case has been pending before the Board in its current posture for almost five years, and various organizations representing “virtually all institutions of higher education” in the country have already filed amicus briefs in the case. They also pointed out that during the long pendency of this case, no other organizations have asked to participate in the case, and there is no legitimate reason to further delay the case.

Although the factors relevant to the managerial authority of university faculty were first enunciated by the U.S. Supreme Court over 30 years ago in a 1980 case involving Yeshiva University, and the Board has since been ordered by the courts to determine in each case “which factors were significant and which less so, and why” the Board has yet to make that determination in this case.  This is astonishing considering that the case was first filed in 2003.

This request for briefs at this time appears to be for the purpose of soliciting more input from organized labor on this issue and to engage in a sort of back door rulemaking on the issue of faculty organizing.  Although the U.S. Supreme Court made clear in the Yeshiva University case that each university is different, and the Board must make a decision in each and every case based upon the facts of that case, it appears that the Board intends to use its current three Democrat majority to create a precedent about which managerial factors are more important, and which are less important, in all cases.  It will be no surprise if the Board ultimately narrows the managerial exception and makes it easier for faculty to organize in future cases.

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NLRB’s New Rules Governing Union Representation Election Procedures Go Into Effect

By Edwin S. Hopson

New rules governing procedures applicable to the processing of representation cases before the National Labor Relations Board went into effect on April 30, 2012.  According to an April 26, 2012, memorandum issued by NLRB Acting General Counsel Lafe Solomon to NLRB field personnel, the new rules “are designed to reduce unnecessary litigation in representation cases and thereby enable the Board to better fulfill its duty to expeditiously resolve questions concerning representation.” 

The changes are:

1.         §102.64 is amended to expressly construe Section 9(c) of the National Labor Relations Act to state that the statutory purpose of a pre-election hearing is to determine if a “question concerning representation” exists.

2.         §102.66 is amended to clarify that NLRB hearing officers presiding over pre-election hearings have the authority to limit the introduction of evidence to that which supports a party’s contentions and is relevant to the existence of a “question concerning representation.”

3.         §102.66(d) is amended to afford the hearing officer presiding over a pre-election hearing the discretion as to whether or not the filing of post-hearing briefs will be allowed, and, if so, what issues are to be addressed, and the time for filing, all subject to the ultimate authority of the regional director.

4.         §§102.67 and 102.69 are amended to defer most requests for Board review—with the exception of special permission to appeal—until after the election is conducted; any such post-election request can also be consolidated with a request for review of any post-election rulings.

5.         §101.21(d) is amended to eliminate the recommendation (along with all of Part 101, Subpart C) that the regional director should ordinarily not schedule an election sooner than 25 days after the decision and direction of election in order to give the Board an opportunity to rule on a pre-election request for review, since such requests can now only be made after the election is conducted.

6.         §102.65 is amended to clarify and narrow the circumstances under which a request for special permission to appeal to the Board will be granted.

7.         §§102.62(b) and 102.69 are amended to create a uniform procedure for resolving election objections and potentially outcome-determinative challenges in stipulated and directed election cases and to provide that Board review of a regional director’s resolution of such disputes is discretionary.

Dissenting Member Hayes issued a written statement in which he argued, among other things, that the new rules are contrary to the Act and the constitution as well as contrary to past practice at the Board.  Hayes points out that only two members of a five member board approved the new rules. Chairman Pearce offered a rebuttal in the form of a concurring statement supporting the implementation of the new rules. Chairman Pearce’s and Member Hayes’ statements can be found at:


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U.S. Chamber of Commerce Challenges Legality of NLRB Recess Appointments

By Edwin S. Hopson

On March 15, 2012, the U.S. Chamber of Commerce and the Coalition for a Democratic Workplace (CDW) filed a motion to intervene with the U.S. Court of Appeals for the D.C. Circuit in Noel Canning v. National Labor Relations Board, Case No. 12-1115, an appeal by Noel Canning of an unfair labor practice decision by the Board issued February 8, 2012 by Members Block, Flynn and Hayes.  The Chamber and CDW seek to challenge the authority of the National Labor Relations Board to adjudicate charges absent a proper three-member quorum.  It claims that the President’s recess appointments of Sharon Block, Terence F. Flynn, and Richard Griffin to the NLRB in January 2012, unlawfully circumvented the U.S. Senate’s constitutional power to provide advice and consent to the appointment of executive branch officers. According to the motion to intervene, the three recess appointments to the Board were not legally effective because the President made them when the Senate was in actually session, not in recess. Since at that time there were only two confirmed Members of the five-Member Board, the Chamber and CDW contend, that there was lacking a legal quorum as required by the Supreme Court’s New Process Steel decision.  Therefore, the Board had no authority to issue its decision involving Noel Canning, according to the Chamber and CDW.

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NLRB Republican Member Hayes Threatens Resignation Over Proposed Election Rule

By Edwin S. Hopson

In an article by Holly Rosenkrantz on the Bloomberg Businessweek website dated November 23, 2011, it reported that National Labor Relations Board Member Brian Hayes, the only Republican on the Board, is threatening to resign rather than allow a vote now scheduled for November 30, 2011, on a controversial new rule aimed at speeding up union representation elections. 

According to the article, NLRB Chairman Mark Pearce is quoted in a November 22 letter to Hayes as stating, “[y]ou indicated that, if the board proceeded with consideration of the matter, you would consider resigning your position.”

There are currently only three members on the five-member NLRB, and under last year’s Supreme Court decision in New Process Steel v. NLRB, if the Board is reduced to fewer than three members, it cannot continue to issue decisions. See posts below dated November 21 and 18.

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NLRB Member Hayes Accuses Colleagues of Misleading House Committee on New Election Rule

By Edwin S. Hopson

In an unusual move, Member Brian Hayes, the only Republican on the National Labor Relations Board, has written a letter to the Chairman of the U.S. House Education and Workforce Committee criticizing the other two Democratic Members of the Board for scheduling a meeting on November 30, 2011, at which they will make a decision on the Board’s proposed new rule aimed at speeding the union representation election process.  Hayes claims that the meeting will violate Board rules and practice involving its deliberative process.  He also asserts that he has been left out of that process and has, for instance, not seen any summary of the some 65,000 comments received by the NLRB concerning the proposed new rule, nor been given adequate time to prepare a dissent regarding the new rule.  

Hayes also seems to accuse the majority on the Board of misleading the House Committee in a letter dated November 10, 2011, responding to a request from the Committee for a status report and timeline on the proposed new election rule. 

In a letter dated October 27, 2011, Committee Chairman John Kline had requested a number of items of information from the Board in order “[t]o better understand the process and timeline for the issuance of the new rule….”  In its November 10 response, the Board advised the Committee:

“The following is a timeline of past and anticipated actions on the rulemaking:

June 22, 2011 – Publication of proposed rule.

July 18-19, 2011 – Public meeting on proposed rule. 66 witnesses testified before the Board.

August 22, 2011 – Deadline for filing initial public comments.

Sept. 6, 2011 – Deadline for filing reply comments.

Unknown – Board vote on how to proceed on final rule.

Unknown – Draft of final rule circulated to Board Members.

Unknown – Publication of final rule in Federal Register.”

Hayes in his November 18 correspondence to the Committee states:

“The central fact omitted from the November 10 response letter is that there is a timeline for anticipated actions.  My colleagues are committed to issuing a final R Case Rule before Member Becker’s recess appointment expires at the end of the current Congressional session.  Indeed, I was advised of this fact by the Board’s Chairman on the very day that the response letter was forwarded to your office.” [Emphasis in the original].

On November 18, 2011, Board Chairman Pearce announced the scheduling of the November 30 meeting at which a decision on the new rule will be made.  See prior post below dated November 18, 2011.

Also on November 18, 2011, Committee Chairman Kline wrote another letter to Board Chairman Pearce seeking information not supplied in the NLRB’s November 10 response and also stating:

“Needless to say, Member Hayes’ assertions are extremely troubling, as they would suggest you deliberately withheld information from the committee, if not knowingly provided the committee with misleading information.”

Kline requested a response from Board Chairman Pearce by November 29, 2011.

 The letters in question may be found on the Committee’s website at: