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The National Labor Relations Board’s chief investigator is looking into whether Member Mark Gaston Pearce (D) told a group of lawyers about a surprise decision in an important case before it was public, sources told Bloomberg Law.
NLRB Inspector General David Berry is investigating claims that Pearce told attorneys at an American Bar Association event that a “big decision” was coming in the Hy-Brand Industrial Contractors case. The board a day later unexpectedly decided to scrap a precedent-setting ruling in that case, responding to conflict-of-interest concerns about Member William Emanuel (R).
Pearce allegedly spread the news at the meeting in Puerto Rico before Emanuel learned that he was left out of the decision. The Competitive Enterprise Institute, a free-market think tank, earlier this week asked Berry explore whether Pearce violated a federal regulation by disclosing the information.
“We hope the NLRB Inspector General will conduct a vigorous, thorough investigation into whether board Member Mark Pearce publicly disclosed confidential, internal board deliberations,” CEI policy analyst Trey Kovacs told Bloomberg Law in an email.
An NLRB spokeswoman told Bloomberg Law that Berry’s office “cannot confirm or deny the existence of an investigation.”
The move comes just days after Berry issued a report finding that Emanuel twice violated an ethics pledge by participating in the closely-watched Hy-Brand and Browning-Ferris Industries cases. Both cases focus on joint employer liability, a contentious legal question about the circumstances under which one business can be considered an employer of another business’s workers for unionization purposes.
It’s standard practice for Berry to open an investigation after receiving a request like the one from CEI, Jennifer Abruzzo, the board’s former acting general counsel, told Bloomberg in an email. Abruzzo, now a lawyer for the Communication Workers of America, rejected the comparison of Pearce to former NLRB Member Terence Flynn (R). Flynn resigned in 2012 after Berry found that he improperly leaked drafts of board decisions while Flynn was still working as a board staff attorney.
“Even if Member Pearce said what is being reported, I don’t see how that remotely equates to the actions of board Member Flynn and more recently board Member Emanuel,” Abruzzo said.
The swirling ethics questions have left uncertain how the board, and NLRB lawyers tasked with enforcing federal labor law, currently determine whether businesses are joint employers.
Companies that use franchise, staffing, and contract arrangements have said wider liability makes them responsible for workers they don’t control. Unions and worker advocates say a broader approach cuts through complicated arrangements to give employees a voice with those actually deciding the terms and conditions of their jobs.
The board’s Democrat majority in 2015 used Browning-Ferris to expand joint employer liability to include situations in which a business exerts indirect control over workers. A Republican-majority board in December used Hy-Brand to overturn that decision and return to a more limited “direct-control” standard for joint employer liability.
Berry later said Emanuel should have sat out Hy-Brand because his former law firm—Littler Mendelson—represented a subcontractor involved in Browning-Ferris. Emanuel shouldn’t have joined the board in urging the agency’s general counsel to ask an appeals court to drop its consideration of the Browning-Ferris case, the inspector general also said.
Pearce, NLRB Chairman Marvin Kaplan (R), and Member Lauren McFerran (D) decided to scrap the Hy-Brand decision shortly after Berry’s first report became public. Lawyers for Hy-Brand said the board violated federal law by keeping Emanuel out of the loop on the move. They also accused Pearce of spilling the beans about the decision before it was made public.
Pearce’s alleged comments are too vague to pose a serious problem for him, said University of Wyoming law professor Michael Duff, a former NLRB attorney.
The political sensitivity of the Hy-Brand issue might be sufficient alone to cause the inspector general to go out of his way to look into any allegations brought relating to it, Duff said. But what Pearce is being accused of saying—that there was a “big decision” of some sort coming on the Hy-Brand case—could have been expected by anyone watching the case and the ethics investigation, he said.
“Do I think it’s a big deal? Not on those facts, I don’t,” said Duff. “I can’t imagine anyone finding an ethical violation of anything based on those facts.”
Emanuel, through a private lawyer, has maintained that the Hy-Brand and Browning-Ferris cases are unrelated. His supporters are blaming Democrats for trying to slow Republican-led change at the board by pushing ethics questions.
“Labor policy is contentious, and the NLRB is an especially politicized agency, but it is crucial for the inspector general to investigate potential violations no matter what side of the political aisle a board member comes from,” CEI’s Kovacs told Bloomberg Law.
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