Can Labor Board Consider Trump Business Cases?

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By Lawrence E. Dubé

Nov. 21 — Members of the National Labor Relations Board will be able to decide legal disputes involving President-elect Donald J. Trump’s businesses even if they owe their seats on the board to the new president, labor lawyers told Bloomberg BNA.

There is no rule against presidential appointees voting on representation cases or unfair labor practice proceedings that arise at businesses of the president, though the issue has apparently not come up before.

Newly appointed members will have “fairly wide latitude” in hearing Trump cases, law professor Paul M. Secunda told Bloomberg BNA.

Secunda said he doesn’t expect the president’s appointees to recuse themselves from such controversies and doesn’t believe they need to.

New President Can Fill Board Vacancies

The five-seat board currently has only three members—Chairman Mark Gaston Pearce (D) and Members Philip A. Miscimarra (R) and Lauren McFerran (D).

Trump can move early next year to nominate two Republicans to fill the vacant seats on the board and may designate a Republican as chairman.

By the end of his four-year term, Trump likely will have the opportunity to appoint or reappoint all of the board members. Miscimarra’s term ends in December 2017, Pearce’s in 2018 and McFerran’s in 2019.

Trump Cases Likely to Be on Docket

It’s likely that board members will encounter union election petitions or unfair labor practice charges against Trump organizations in the next few years.

Trump casino and resort properties have been targeted for union organizing and a Trump Ruffin Commercial LLC hotel property—the Trump International Hotel Las Vegas—is named in nine unfair labor practice cases now under investigation in the board’s Phoenix office. Those cases, all filed by a single union, stemmed from a lengthy fight over organizing hotel employees. The NLRB certified that employees voted 238-209 for union representation, but the hotel owned by Trump and businessman Phillip Ruffin argued the election was tainted by union misconduct.

A tenth unfair labor practice charge pending in the New York regional office may have implications for Trump businesses around the country.

In September, a California group called the Committee to Preserve the Religious Right to Organize filed an unfair labor practice charge alleging that the Trump Organization interfered with employee rights under the National Labor Relations Act by requiring employees to sign broadly worded secrecy and nondisparagement agreements.

The California group Nov. 21 filed an amended version of the charge that names dozens of Trump business entities as responsible employers along with the Trump Organization.

The NLRB Nov. 3 ordered Trump Ruffin to recognize and bargain with a labor union as representative of employees at the Las Vegas hotel (364 N.L.R.B. No. 143, 207 LRRM 1859 (2016)). The company immediately appealed the ruling to the U.S. Court of Appeals for the District of Columbia Circuit (No. 16-1386).

Law Professor Sees No Recusal Required

There doesn’t appear to be any regulation or clear guidance on the NLRB’s handling of cases involving businesses related to a sitting president. Secunda, a labor law professor at the Marquette University Law School, said the key factor in gauging the duties of board members is that the NLRB operates under the “adjudicative model” under the Administrative Procedure Act.

The fact-finders in NLRB proceedings are generally the agency’s administrative law judges, not the board members, Secunda said. The members of the board provide more of a labor law policy-making function for the agency, he said.

ALJs are not presidential appointees, and the executive branch of government generally has no direct involvement with them or their fact-finding duties, Secunda said.

If members of the executive branch avoid contact with administrative law judges handling Trump cases at the NLRB, there is no need for board members to recuse themselves from those cases, he said.

Board Can Proceed to Decide Trump Cases

Daniel B. Pasternak, a partner who represents employers at Squire Patton Boggs in Phoenix, offered a similar view.

Trump’s business network creates a risk of “potential entanglements all over the place,” he told Bloomberg BNA.

However, a board member’s mere appointment by a president wouldn’t require the person to be recused from an NLRB proceeding, Pasternak said.

If any individual board member chooses not to hear a Trump business case because of the presidential appointment or some other connection to the president, it will not likely prevent the board from mustering a quorum to hear the case, he said.

The board generally requires a quorum of three members for action in an unfair labor practice case or representation case, but where a duly appointed board member is disqualified or recused from participating in a particular case, the board can proceed with two members to resolve the case and issue a decision.

To contact the reporter on this story: Lawrence E. Dubé in Washington at ldube@bna.com

To contact the editors responsible for this story: Peggy Aulino at maulino@bna.com; Terence Hyland at thyland@bna.com

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