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NLRB Continues to Hear Cases That Would Radically Change Labor Law

The National Labor Relations Board continues pose many challenges to employers and employees alike with its recent actions involving several cases and proposed rulemakings. Just last week the National Association of Manufacturers submitted formal regulatory comments to the Board that question its authority to issue regulations that would require almost all employers to post or otherwise communicate a biased notice of unionization rights to their employees.

Now the Board continues to hear cases that could set troubling legal precedent and shift longstanding interpretation of labor law. One such case is Specialty Healthcare and Rehabilitation Center of Mobile and United Steelworkers, District 9, 356 NLRB No. 56 (2010). This case is important because it is “representation case”, meaning that there will be no opportunity for direct judicial review and the Board could begin applying its decision immediately in other cases.
The Board’s ruling is expected to reverse 50 years of case law by radically changing the standard for determining an appropriate bargaining unit for all of the estimated six million workplaces covered by the National Labor Relations Act. The key issue is whether employees performing the same job at a single facility presumptively constitute a bargaining unit for organizing purposes, irrespective of any commonality those employees share with other employees outside the proposed unit.

Former NLRB member and labor law expert extraordinaire Pete Kirsanow recently commented on the impact of this case in National Review Online’s The Corner blog. In his piece, Kirsanow explains how this case could ultimately skew U.S. labor law to make it much easier for labor unions to organize workplaces.

Kirsanow identifies other implications. The case could:

  • Increase the probability that a workplace will have multiple bargaining units representing different classifications of employees; e.g., one unit of, say, two set-up men, another unit of six press operators, yet another unit of three welders, a separate unit of four packers, etc. etc.
  • Increase the probability that a company’s employees will be represented by — and the company must bargain with — multiple unions, e.g., the UAW in one part of the plant, the Teamsters in another, and the SEIU in a third.
  • Increase the probability that an employer would have to manage separate work schedules, grievance procedures, wage schedules, and benefits packages for various bargaining units in a single workplace.
  • Increase the man-hours a company spends on personnel matters such as discipline, grievances, arbitration, and bargaining.
  • Reduce management’s flexibility in matters such as hiring, work assignments, transfers, promotions, layoffs, and overtime.
  • Reduce productivity and increase costs
  • The Board has historically applied a clear set of standards to determining a unit appropriate for bargaining – this case would turn those standards upside down. We hope that board will adhere to longstanding precedent when determining this case.
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Employees Continue to Not Join Labor Unions

This morning the Department of Labor’s Bureau of Labor Statistics released new figures for union membership rates in 2010. Their figures show that union membership continued its downward trend as the number of union members dropped to 14.7 million, down from 15.3 million in 2009. The overall “rate” of unionization also declined as only 11.9 percent of all workers were members of a labor union in 2010.

Last year’s figures showed that for the first time more union members were employed by government in the public sector than by private sector employers. This dynamic continued in 2010 as 52 percent of all union members were public sector employees.

So what does this mean?

  • It’s clear that fewer and fewer American workers feel the need to join labor unions. These figures help to explain why labor leaders have been so adamant in their efforts to change U.S. labor law in order to give union organizers greater influence. In previous years these efforts were marked by union support for legislation like “card check” but union leaders and their allies in Washington are now more focused on using executive branch actions like regulations and NLRB cases to change the rules.
  • In recent years, we’ve seen Big Labor turn increasingly leftward, promoting a “progressive” political and social agenda that has little do with jobs creation and economic growth. By and large, that’s a result of the public sector unions and their leadership trained in government and politics, not on the factory floor. The continuing rise in public sector unions means that fewer union leaders will be engaged with the private sector (manufacturing) economy, which ultimately pays for all the government union jobs. Union leaders have been seeking numerous opportunities to expand the size of government – which would ultimately lead to more public sector employees, which in turn would boost union members.

Policymakers should focus their efforts on developing policies that enable employers to create jobs, rather than seeking ways to prop up union membership by changing U.S. labor laws.

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AFL-CIO Joins NAM to Back OSHA On-Site Consultation Program for Small Business

The AFL-CIO posted an open letter to Rep. Issa (R-CA) from California Labor Federation Legislative Advocate Mitch Seaman reacting to an article in POLITICO about the Congressman seeking input from companies, business groups and think tanks on federal regulation. The AFL-CIO snidely and incorrectly cited part of the article that reported the National Association of Manufacturers’ call for oversight of OSHA’s regulatory proposals that would gut employer compliance programs (e.g. on-site consultation).

The National Association of Manufacturers responded to your request for marching orders by naming OHSA consultations as “high-priority regulations that can cost manufacturing jobs.” Not to nitpick, but OSHA consultations are free services provided by OSHA—or a state OSHA program—that identify potential hazards before they happen. This is a win-win that creates both safer and less expensive work environments. As workers, we are curious as to exactly how jobs are created by eliminating a free service that saves employers money and reduces workplace injury.

Marching orders? What silliness.

Still, we’re pleased to see the labor group’s apparent agreement with the NAM about the value of the consultation program, as the blogger describes them as “a free service that saves employers money and reduces workplace injury.” Absolutely. We feel strongly that OSHA should not hinder a successful program that allows small businesses to voluntarily approach OSHA for advice on how to make their businesses both more productive and safer for their employees. The NAM joined with numerous other organizations in the Coalition for Workplace Safety’s comments to OSHA which urged the agency not to remove important aspects of the program that encourage company participation. It’s rare when the AFL-CIO and the NAM can find common ground on policy, but we were optimistic that we may have found a new ally in our effort to protect an important OSHA program.

Labor’s newfound support is especially welcome since the AFL-CIO submitted comments to the agency’s regulatory proposal calling for major changes that would have made it much more difficult for employers to use the OSHA program effectively. Let’s hope that the members of the California Labor Federation can make AFL-CIO’s staff in Washington aware of why they agree with the NAM when they describe the program as a “win-win that creates both safer and less expensive work environments.”

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President Makes Nominations to Labor Board Amid Increased NLRB Activism

This week President Obama nominated two individuals to serve on the National Labor Relations Board (NLRB). Lafe Solomon, who has been serving as the NLRB’s Acting General Counsel, was picked to be General Counsel and Terrence Flynn, chief counsel to NLRB member Brian Hayes, was nominated to become the fifth member of the five member board. Should Flynn be confirmed, he would join Hayes as the second Republican on the Board.

While it’s unclear how soon these nominations will be considered by the Senate, the confirmation hearings do provide the Senate with an opportunity to review much of the recent NLRB activity that has so alarmed employers. The Board is slated to make decisions in many key cases, including Lamons Gasket Company, which addresses issues with card check certification, and Roundy’s, dealing with workplace access for union organizers. In addition, the Board has already begun the process of proposing new rulemaking that seeks to make sweeping changes to employee relations by requiring employers to post a notice to employees of their right to unionize. Board Member Hayes has expressed the view that the NLRB lacks the necessary authority to propose this rulemaking, which would require employers to display posters of union rights as well as in some cases make employers distribute such a notice to employees through e-mail.

The National Association of Manufacturers has long been troubled that the current NLRB, which includes the controversial Craig Becker, intends to bend its authority to implement the goals of the jobs-killing Employee Free Choice Act, skewing the balance of labor relations towards labor unions. The changes sought by the NLRB produce a tremendous amount of uncertainty for employers, which in turn threatens jobs creation and the economic recovery.

We hope that the Senate uses the confirmation process to fully review the Board’s recent action – and makes it clear that the NLRB should not seek to change U.S. labor law without the necessary Congressional action.

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Congress Recognizes Importance of All American Workers‬‪‬‪

America’s high-skilled manufacturing workforce is one of the most important contributors to our economy, producing 1/8 of the  nation’s GDP. Through their hard work, manufacturing workers in the U.S. make over 1/5 of all things made on the planet. This dynamic workforce includes employees who are represented by labor unions and those that are not.‪

This week marks the start of the 112th Congress, and the Committee that has jurisdiction over issues facing American workers begins with a new name – the Committee on Education and Workforce. Government institutions including cabinet agencies and Congressional Committees often change names to reflect changing dynamics and priorities: the Department of War is now the Department of Defense, the House Committee on Banking and Currency is now the House Committee on Financial Services, etc.‪

It is fitting the House Committee with jurisdiction over issues facing American workers will have a new name – the House Committee on Education and Workforce. It is true that historically that Committee had been named the Committee on Education and Labor, with the exception of brief periods of time when it was referred to differently.

This latest renaming indicates that the Chairman of the Committee, Rep. John Kline (R-MN), intends to focus on all workers in the economy and not just the 12.3 percent of American workers (and only 7.2 percent of private sector workers) who are members of labor unions.

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Labor Board Proposes New Posting Requirement

The National Labor Relations Board (NLRB) today released a notice of proposed rulemaking that would require employers to post a notice to employees informing them of their rights under the National Labor Relations Act. Such a concept follows the recent move by the Obama Administration to require a similar posting for the employees for federal contractors.

In its proposal, the Board indicated that a majority believes that “many employees protected by the NLRA are unaware of their rights.” Brian Hayes, the lone Republican who serves on the Board, dissented from the proposal, arguing that the Board lacks the authority to impose such a requirement on employers. Hayes contends NLRB can only require such a posting after a finding of an unfair labor practice by an employer.

However, this notice for proposed rulemaking goes beyond just requiring employers to post a poster in their workplace, as they are required to do under other employment laws like the Family and Medical Leave Act and the Fair Labor Standards Act. Should this proposal be enacted as drafted, employers who communicate with their employees through web and e-mail would also be required to transmit this new posting of employee rights electronically.

We’ve long been troubled by and have predicted the NLRB’s intention to reinterpret U.S. labor law outside of Congress’ purview in order to expand union membership. Today’s announcement is certainly evidence that the board is well under way.

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Labor Department Regulatory Agenda is Not a Growth Agenda

President Barack Obama met with business leaders last week to discuss “a shared agenda focused on moving our economy forward that not only continues to grow the economy, but also ensures America is competing and leading in the world.” He then later met with labor union leaders in which the President “reinforced the essential role the union movement plays in growing the economy, creating good jobs on Main Street, and keeping America competitive.”

It appears that the President is rightfully focused on job creation and enhancing our nation’s economic competitiveness.

We looked forward to going through the Department of Labor’s Fall 2010 regulatory agenda (on the last day of the season!) today to learn how the Labor Department was going to achieve the goal of achieving “Good Jobs for Everyone.” Now that’s it’s here, most of what we see is focused on increasing regulations on employers and achieving goals that were unable to be done legislatively.

Specifically the agenda includes:

  • A new regulatory proposal that would require companies to disclose to both independent contractors and employees alike a description of their status as either an employee or independent contractor. While few details are offered on this expected regulatory endeavor it appears to place new requirements on employers to disseminate information to employees. This regulation appears to be very similar to legislation, the Employee Misclassification Prevention Act, offered by Sen. Sherrod Brown (D-OH) and Rep. Lynn Woolsey (D-CA).
  • Information on proposals expected from the Office of Labor Management Standards that would require employers to disclose the details of when they engage in “persuader activities” and plans to “reconsider” (i.e. limit) the types of efforts engaged by employers to comply with labor laws that are not currently required to be disclosed. Note: the administration previously removed a set of disclosure requirements for union organizations citing the burden they posed for labor leaders to comply.
  • An update on OSHA’s efforts to mandate an expansive safety and health program standard through what has been called the “Injury and Illness Prevention Program”
  • An indication that OSHA intends to finalizing their proposed rulemaking to allow citations to be issued for certain small businesses that wish to work proactively with the agency to ensure that they are compliant with existing OSHA standards and regulations – a move that would deter participation in a very effective program.

As we’ve stated here numerous times: more regulations from the Executive Branch produce a lot of uncertainty for employers, to whom unnecessary costs represent an obstacle to economic growth.

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OSHA Needs to Explain Its Unfounded Noise Proposal

OSHA formally announced in the Federal Register this morning that that the agency will be extending the comment period for their proposal to change noise abatement requirements. However, many on Capitol Hill are asking OSHA if the agency understands the impact that this proposal will have on manufacturers of all sizes.

From OSHA’s notice in the Federal Register:

Two commenters, the National Association of Manufacturers and the Coalition for Workplace Safety (CWS), representing employers who would be affected by the proposed interpretation, have requested an extension of 90 days to assess the operating changes that their members would be required to make to comply with the interpretation.

While this announcement makes the extension official we appreciate that OSHA has recognized that it would take much longer than then initially proposed 60 day window to accurately assess the impact of the agency’s proposal.

We say “proposal” and not “proposed rule” because the agency is attempting to make these changes outside of the formal rulemaking process. While OSHA officials are accepting comments to the regulatory docket the agency is not compelled to take stakeholder feedback into account. Manufacturers, particularly smaller sized manufacturers, will be impacted by these changes, which come at staggeringly high costs without any evidence that the current process of protecting employees is deficient.

David Michaels, the Assistant Secretary of Labor for OSHA, told The Hill newspaper that the agency is “sensitive to possible costs associated with improving worker protection”. Further he said:

Our common objective is to ensure that workers don’t lose their hearing without overly burdening employers. OSHA will take all stakeholder comments seriously and will fully consider impacts on business and workers before determining what final action, if any, we will take.

We hope OSHA does take these comments seriously and realize that the costs of making these changes far outweigh potential benefits (if any) that may result.

Yesterday Senators Olympia Snowe (R-ME) and Joe Lieberman (I-CT), who co-chair the Senate’s Task Force on Manufacturing, sent a bipartisan letter to Labor Secretary Hilda Solis asking for more information on why the proposal has been put forth. The Senators point to important data that shows that the number of hearing loss incidents in the workplace is quite low and is improving significantly.

OSHA does not appear to support this change with data or any suggestion that employees require this new level of protection. Indeed the most recent Bureau of Labor Statistics (BLS) data on hearing loss injuries shows that from 2004-2009, incidences of hearing loss injuries have decreased from just under 29,000 per year to 19,500 per year and the rate of injuries has gone from 3.2 per 10,000 employees down to 2.2

More importantly the Senators posed several important questions to the Secretary of Labor that we very much look forward getting answers to as well:

-Did OSHA consider alternative interpretations prior to deciding to publish the proposed interpretation in the Federal Register? If so, what were these alternatives?
-Did OSHA consider any unintended consequences the proposed interpretations could have on small businesses? How did the agency address these concerns during formulation of the proposed interpretation?
-Does OSHA have any quantitative data affirming the necessity to change this policy, given that numerous organizations have noted that the current policy is effective?

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Flawed Mine Safety Bill Fails in House

This afternoon the House recognized that Robert C. Byrd Mine Safety Protection Act of 2010 was the wrong approach to enhance the safety of mines by failing to pass the legislation. The legislation was introduced late on Friday December 3 and was rushed to the House floor under suspension of the rules which meant that bill would’ve needed a 2/3 vote to approve the measure. The final vote was 214-193 with 27 Democrats opposing the bill.

Although the NAM sent a Key Vote letter to all Representatives urging opposition to the bill, manufacturers wholeheartedly support the legislation’s goal of maintaining safe and healthy workplaces for our nation’s miners.

We continue to urge policy makers to adopt collaborative approaches to address our shared goals of making our workplaces safer, but this legislation was the wrong approach to workplace safety. Should the bill have become law it would have dramatically increased the cost of coal production, driving up energy prices for consumers and for American manufacturers, who use roughly one-third of our nation’s energy supply. Additionally the legislation contained provisions that would have bypassed normal regulatory procedures by mandating that MSHA issue news standards and regulations without giving advanced notice or sufficient opportunity for employers to provide feedback. Additionally the bill would have imposed vague new standards for criminal liability, potentially criminalizing most infractions and subjecting officials to sanctions over which they have no direct control.

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Senate Votes for Jobs over Job-Killing Paycheck Fairness Act

By a vote of 58 to 41 this morning, the Senate effectively blocked the Paycheck Fairness Act (S.3772) by failing to garner the 60 votes necessary to invoke cloture on the legislation. This was a tough vote for many due to the sound bite appeal of the bill’s title, but in the end they did the right thing and voted for jobs. Supporters claim that the bill would have established gender pay equity in the workplace. Unfortunately, the legislation would have done nothing to prevent actual instances of illegal discrimination. Instead, it would have posed a tremendous threat to manufacturers’ efforts to create and retain jobs by inviting uncertainty to almost every pay decision employers make. Manufacturers are committed to fair pay in the workplace, but it is difficult to imagine a scenario in which this bill would not have led to lower wages and fewer jobs.

The Paycheck Fairness Act would have invited unwarranted and costly litigation against employers at a time when businesses are struggling in the weak economic recovery. We appreciate that the Senate recognized this misguided bill’s harmful impact on job creation and prevented it from moving forward. With today’s vote now behind us, we remain committed to working with Congress to prioritize proposals that will promote economic growth and help manufacturers create jobs.

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