NLRB Issues Final Rule on Union Elections; Business Groups Respond With Lawsuit

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The National Labor Relations Board Dec. 21 released a final rule amending its procedures in union representation cases to limit the issues considered in NLRB hearings, eliminate pre-election board review of regional directors' decisions, and take other steps the agency said will “reduce unnecessary litigation and delays.”

The final rule, published in the Dec. 22 Federal Register (76 Fed. Reg. 80,138), does not include all of the measures that a divided NLRB proposed 3-1 in a June rulemaking notice. Still, business groups expressed their disapproval of the final rule, which the U.S. Chamber of Commerce and Coalition for a Democratic Workplace promptly challenged in a federal court lawsuit.

In addition, Sen. Mike Enzi (R-Wyo.), the ranking member on the Senate Health, Education, Labor and Pensions (HELP) Committee, said he will use the Congressional Review Act to challenge the rule, charging that the new rule “will allow union bosses to ambush employers.”

Congressional Democrats, however, praised NLRB for taking the action that it did. Rep. George Miller (D-Calif.), the ranking Democrat on the House Committee on Education and the Workforce, said NLRB's final rule will “reduce the amount of wasteful pre-election maneuvering used to delay or deny workers' rights to a vote.”

NLRB Chairman Mark Gaston Pearce (D) and Member Craig Becker (D) approved the final rule without the agreement of Member Brian E. Hayes (R), who opposed the action. Pearce and Becker said in comments that they had authority to take action without the support of a third board member, and wrote that by selecting an April 30, 2012, effective date for changes in board procedures, they are giving Hayes a “reasonable period of time to express his views in a timely, formal, and public manner.”

NLRB Rulemaking Was Proposed in June.

The final rule is based on a June 22 notice of proposed rulemaking in which then-Chairman Wilma B. Liebman (D) and Members Becker and Pearce proposed changes they said would streamline litigation and limit the availability of board review in representation cases, allowing the board to conduct representation elections in a shorter time after the filing of a petition for a secret ballot election.

The board held a two-day public meeting on the proposal in July (29 HRR 791, 7/25/11) and received more than 65,000 public comments.

Liebman's term ended Aug. 27, and Becker is serving as a board member on a recess appointment that will end this month. President Obama has nominated three other lawyers as board members, but without Senate confirmation or a recess appointment of another member, the board would be left with only Pearce and Hayes following Becker's departure.

The U.S. Supreme Court held in New Process Steel LP v. NLRB (130 S. Ct. 2635, 188 LRRM 2833 (2010); 28 HRR 650, 6/21/10) that the authority of the five-seat board to issue final decisions cannot be delegated to a panel with fewer than three members.

Final Rule Delivers Expected Amendments.

Consistent with the chairman's resolution, the final rule makes seven changes in NLRB procedures in representation cases:

1. Amending board regulations to state that the purpose of pre-election hearings described in Section 9(c) of the National Labor Relations Act is to determine whether a question concerning union representation exists that should be resolved in a secret ballot election.

2. Giving NLRB hearing officers authority to limit the presentation of evidence in such a hearing to genuine issues of fact material to the existence of a question concerning representation.

3. Providing for posthearing briefs with the permission of a hearing officer, rather than as a matter of right.

4. Amending Section 102.67 and Section 102.69 of the board's rules to eliminate parties' right to seek Board review of regional directors' pre-election rulings while allowing parties to seek post-election review of such rulings.

5. Eliminating language in NLRB's current statement of procedure that recommends a regional director not schedule balloting within 25 days of directing an election.

6. Amending Section 102.65 of the board's rules to provide that requests for special permission to appeal a regional director's pre-election ruling will be granted only in extraordinary circumstances.

7. Amending board rules to make NLRB review of postelection disputes discretionary.

The rule also makes technical or conforming amendments to reconcile its existing regulations and statements of procedure with the proposed amendments.

Pearce, Becker Defend Rule as Fair, Necessary.

The board majority acknowledged that many organizations opposed the original rulemaking proposal on grounds that the changed procedures the board was considering would unreasonably shorten the time between the filing of an election petition and the date of actual balloting.

The change would deprive employers of an opportunity to express their views and would limit the ability of employees to obtain and consider information about an important matter, many organizations argued in comments on the proposed rule.

But Pearce and Becker said “most comments raising these arguments focus on the Board's [original] proposals to: (1) set pre-election hearings to open seven days from the notice of hearing absent special circumstances; (2) shorten the time period for production of a final voter list from seven days to two days following a regional director's approval of an election agreement or direction of an election; and (3) shorten the time period during which the Board's final notice of election must be posted prior to the election.”

None of those proposals was included in Pearce's Nov. 30 resolution or the final rule. Pearce and Becker said “[t]he final rule simply removes unnecessary barriers to prompt resolution of questions of representation by reducing needless litigation.”

The board majority said with the two Democrats and Hayes on the board, they had the required quorum to take action, and they rejected arguments that they were acting improperly in issuing a final rule without Hayes either joining in their action or dissenting.

“Although Member Hayes has not yet supplied a dissent or similar statement in connection with the final rule itself, the Board has authorized the publication of such a document in the Federal Register, together with any separate concurring opinion, when they are made available,” they said.

Business Groups Sue.

Even before the NLRB issued the final rule, the chamber and the Coalition for a Democratic Workplace filed a lawsuit in federal district court seeking to enjoin the agency from enforcing the rule (Chamber of Commerce v. NLRB, D.D.C., No. 1:11-cv-02262, complaint filed 12/20/11).

The Dec. 20 complaint filed in the U.S. District Court for the District of Columbia asserted that the final rule violates the National Labor Relations Act, exceeds the board's statutory authority, and is contrary to the First and Fifth amendments to the U.S. Constitution, which guarantee the rights to free speech and due process.

In addition, the complaint alleged that by issuing a final rule on the signature of just two members of NLRB, the board's actions are “arbitrary, capricious, and an abuse of discretion.”

Lastly, the complaint alleged that the board members violated the Regulatory Flexibility Act by failing to provide an “adequate factual basis” for concluding that the rule will not have a significant impact on a substantial number of small entities, as well as failing to consider the economic impact on small businesses of speeding up the election process.


Text of the NLRB rule changes and accompanying comments may be accessed at http://op.bna.com/dlrcases.nsf/r?Open=ldue-8prn5z. The complaint in the lawsuit against NLRB may be accessed at http://op.bna.com/dlrcases.nsf/r?Open=ldue-8prpe2.