Law Offices of Stanley E. Niew, P.C.
attorneys at law
LABOR & CONSTRUCTION LAW UPDATES
These Newsletters are not intended as legal advice since each situation depends specifically on the facts presented. Persons reading these Newsletters should seek competent legal advice with regard to the subjects contained herein before making any employment or other decisions.
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APRIL 2020
Inside this Issue
1. Families First Coronavirus Response Act (“FFCRA”)
2. OSHA Issues Guidance over COVID-19
3. NLRB Clarifies What is Permitted in Confidentiality Agreement and Cell Phone Policies
4. NLRB Returns to Its Old Standard of Good Faith Bargaining as Well as Impasse
5. The 7th Circuit Court of Appeals Gives Guidance on Discrimination Claims
6. Avoid Collective Actions through Arbitration Clauses
Families First Coronavirus Response Act (“FFCRA”)
The FFCRA became effective April1, 2020, not April 2, 2020 as originally announced. All employers with 500 employees or less, including part-time employees are subject to the provisions of FFCRA.
The first milestone is today April 1, 2020 in that all covered employers must display the new poster and transmit it to all employees by e-mail or U.S. Mail. The poster is available at: https://www.dol.gov/sites/dolgov/files/WHD/posters/FFCRA_Poster_WH1422_Non-Federal.pdf
Stanley E. Niew is available to counsel employers on how the provisions of the FFCRA apply to a particular fact situation. If you would like to consult with the undersigned please send Stan an email at sniew@senlaw.net with a suggested day and time and he will timely respond or in the alternative he can be reached via cellphone at (630) 888-2787.
Stan has reviewed the statute in detail as well as all the Department of Labor guidance.
OSHA Issues Guidance over COVID-19
This week OSHA issued its guidance giving recommendations on how to reduce exposure under COVID-19. OSHA reminded employers of the General Duty Clause which requires employers to provide a workplace free from recognized hazards. The advice is to plan now and consider risk factors and take the appropriate steps. Use the CDC guidance as a basis for analysis of risk factors.
You can review the guidance at: https://www.osha.gov/Publications/OSHA3990.pdf
NLRB Clarifies What is Permitted in Confidentiality Agreement and Cell Phone Policies
On February 5, 2020, in Argos USA, LLC, the Board went to great lengths to establish what is a lawful confidentiality agreement and lawful cell phone policy.
The Confidentiality agreement in Argos states, in part, that employees “may receive and obtain access to confidential Company information” and that they agree to “not disclose any such confidential information.” Confidential information is defined as
. . .all private information not generally known in the industry and not readily available, written, or otherwise including, but not limited to, information regarding Argos’ customers, customer lists, prospective customers, customers’ buying habits, production methods (including designs, formulas, techniques, processes), any non-published prices, discounts, commissions, costs, supplier information, earnings, contracts, employee information, subcontractors, business plans, marketing and/or supply strategies, training programs, computer software or programs, and other business arrangements. . .[Emphasis added.]
Several paragraphs after the definition paragraph, the policy states employees will (1) assign to Argos inventions, processes, discoveries, or improvements developed while working for it; (2) assist Argos with the preparation for patent applications any time within two years after termination of employment; and (3) not divulge confidential information from prior employers to Argos, including financial information or technical manuals.
The Board ruled the confidentiality agreement applies to Argus proprietary business information and the term “earnings” is understood to mean revenue and profit not employee wages. “Employee information” refers to staffing information and not wages or contact information.
The cell phone policy states in part:
Road safety must be a priority. Cell phone use must never distract a driver’s attention from safely operating a vehicle. Employees are expected to direct all necessary attention towards the safe operation of vehicles driven by them, to ensure their own safety as well as the safety of others around them, including pedestrians and passengers in vehicles nearby.
…
It is strictly prohibited for a cell phone to be in the cab of a commercial and/or heavy equipment vehicle; (i.e., “commercial vehicles” are defined as having a gross vehicle weight of 10,000 lbs. or more including any heavy equipment used on the plant yard. [Emphasis in original.]
Employees are also required to sign a cellular phone acknowledgement form ensuring cell phones were not used in commercial vehicles for reasons of safety. The Board held the cell phone policy read as a whole from the perspective of an objectively reasonable employee prohibits the possession and use of cell phones in Argos vehicles, but does not restrict employee’s right to communicate with each other during non-work time.
NLRB Returns to Its Old Standard of Good Faith Bargaining as Well as Impasse
Over recent years, the NLRB regions applied one standard of good faith bargaining for unions and another standard for employers. The regions ignored Section 8(d) of the Act which provides that the duty to bargain in good faith “does not compel either party to agree to a proposal or require the making of a concession.”
The case of Phillips 66 decided January 21, 2020, made it clear that the Board will apply Section 8(d) as written. A review of the Phillips 66 facts are as follows:
- The unit in question consisted of five health and safety shift specialists (HSS).
- Just before a Board held representative election Phillips HR department met with the HSS employee and explained that some of their job duties were supervisory, that Phillips would strip them of these duties if they joined the union, and without the safety duties Phillips might not need to maintain existing around-the-clock staffing for HSS personnel.
- The parties entered into a side letter prior to commencing negotiations where Phillips agreed to a specific hourly rate for the HSS classification, or its replacement, specified that the focus of the classification would remain health and safety and promised it would not lay off any employees if the HSS positions were eliminated through bargaining.
- The parties negotiated for approximately seven months.
- Phillips took the position that it was improper for unit employees to perform incident commander duties (supervision); and there was no need for the HSS position at the facility at all times; and without the need for HSS specialists at all times, Phillips would need to reassign the around-the-clock duties. Phillips proposed to abolish the HSS class and create a new health and safety coordinator with different and fewer job duties, different work schedules and ultimately lower wages.
- In June the parties agreed to seniority rankings.
- In July Phillips withdrew its opposition to union’s request that the HSS receive an annual salary increase and offered to pay the employee at their HSS specialist wage rate for 13 weeks following any transfer.
- In August the union agreed that HSS would no longer perform incident commander duties and expressed willingness to cooperate to secure OSHA certifications; otherwise the union rejected all Phillips’ proposals.
- In September Phillips offered to place employees transferred on a shift schedule that would increase their work hours and to forego passing a standard entry job examination, but also decreased its wage proposals.
There were no meetings in September, but Phillips wrote a letter in October recounting the course of negotiations and identified all concessions it made and asked for the union to respond to the latest proposal. The union replied it was studying the proposal and asked to meet on November 18. The union wrote it disagreed with Phillips’ representations and accused Phillips of discrimination because their proposal was without business justification. Later in October Phillips wrote it denied discrimination, identified essential areas of disagreement and that it was committed to bargain in good faith.
At the November 18 meeting, Phillips declared an impasse due to lack of progress which the union disputed. Phillips also told the union that it had “room to move if you agree that there can be only two HSS specialists transferred to a new position.”
Following the November 18 meeting the union asked and received an extension of time to respond to the disputed final offer. The union rejected the proposal of Phillips, but disputed there was an impasse and offered to meet further. Phillips then declared impasse again and implemented terms of its final offer including transferring the HSS people to operator positions.
The Decision: The Board first cited to a 70 year old Supreme Court case that held ”The Board may not, either directly or indirectly, compel concessions or otherwise sit in judgment upon the substantive terms of collective bargaining.” The Board found there was no evidence of overall bad faith negotiations. The Board went on to say it is not for the Board to decide the good or bad faith of the parties based on the correctness or incorrectness of the reasons they put forward in a proposal in support of a bargaining position. A question of assessment of the financial condition of a company is driven by the marketplace. The Board in this case applied a “total conduct standard.” This does not mean that the content of a bargaining proposal may never be deemed relevant in determining if a party was intent on frustrating the possibility of reaching an agreement, i.e., threatening plant closure, stating it will never sign a contract or similar threats.
The Board will consider whether negotiations reached impasse by reviewing parties’ bargaining history, their good faith, the length of negotiation, the importance of issues in dispute and the parties’ contemporaneous understanding of status of negotiations. An impasse finding is warranted where there is “no realistic possibility that the continuation of discussions. . .would have been fruitful.” Impasse can be found after seven months and ten bargaining sessions that neither party would modify its position on a critical issue. A parties’ bare assertion of flexibility on open issues and its generalized promises of new proposals without more does not demonstrate a change in a bargaining position.
The Board concluded the parties bargained in good faith but were unable to reach agreement on key issues. Thus, declaration of impasse was appropriate. The Act does not require anything more.
The 7th Circuit Court of Appeals Gives Guidance on Discrimination Claims
Edith (plaintiff) worked for a warehouse owned by Mars, Inc., the candy maker, and operated by Kenco Logistics. Edith was a black woman born in 1962 who performed clerical and administrative duties but had no managerial responsibilities. When Kenco lost the Mars contract, it let go all the employees at the warehouse and Edith sued Kenco, Mars and several supervisors alleging discrimination based on race, gender, age and disability and also alleged a conspiracy to violate her civil rights.
The appellate panel agreed that she was not discriminated against by being paid less than her white male co-worker. The panel noted that the employee she cited is earning more money and had extensive managerial responsibilities, while Edith had none.
The panel then looked at Edith’s claim that defendants hired a younger, white woman as her boss. The panel noted that Edith never applied for the human resources position, thus her failure to promote claim cannot succeed. The panel next turned to Edith’s Section 1981 [1] claim which also must fail because there is nothing in the agreement between Kenco and Mars that established joint control over the warehouse employees.
[1] Section 1981 was originally part of the Civil Rights Act of 1866 which allowed all persons to have the full and equal benefit of all laws and proceedings as is enjoyed by white citizens.
Avoid Collective Actions through Arbitration Clauses
The 7th Circuit Court of Appeals recently ruled in Bigger v. Facebook, Inc. that valid arbitration agreements may prevent class notices from being mailed to employees who would normally be part of the class members in a collective action lawsuit.
In this case, the plaintiff proposed a notice to a group of Facebook employees in order to inform them of her lawsuit and their possible participation in the lawsuit. The lower court authorized the notice. Facebook appealed.
The Appellate court stated that the employers who seek to prevent employees from receiving notice can show by the preponderance of the evidence the existence of a valid arbitration agreement for each employee it seeks to exclude receiving a notice. The arbitration agreement in this case prohibited employees from participating in collective action lawsuits, i.e., the employees must arbitrate the issue.
While the Appellate court ultimately agreed with the plaintiff based on factual issues, this case stands for the proposition that valid arbitration clauses can shield employers from having other employees receiving notice of collective or class action lawsuits.
Employers may wish to consider having new employees and, in some instances, current employees to sign arbitration agreements that they will not bring or participate in class lawsuits under the Fair Labor Standards Act or similar federal statutes.
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