NLRB Blocks McDonald's Probe of Protesters

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By Lawrence E. Dubé

March 18 — An administrative law judge acted within her discretion in denying McDonald's USA LLC's efforts to subpoena documents from unions and other groups that were involved in a protest campaign against the national restaurant chain, the National Labor Relations Board held March 17.

McDonald's can try to explain its actions in the context of mass demonstrations launched by employees and protest groups, but the board said probing the protesters' motives won't establish a defense against the unfair labor practice allegations.

McDonald's served the subpoenas in connection with the ongoing unfair labor practice case in which the NLRB general counsel alleges McDonald's is a joint employer with certain franchisees, but Chairman Mark Gaston Pearce and Member Kent Y. Hirozawa agreed with the ALJ that the subpoenaed information is not relevant to the legal proceeding.

McDonald's perception of the campaign by the Service Employees International Union and other groups may be relevant to its defense, but the actual motives of the protest groups is not, Pearce and Hirozawa said. Member Philip A. Miscimarra wrote a partial dissent.

Subpoenas at Stake in McDonald's Case

The subpoena dispute is one chapter in the lengthy case, in which the general counsel alleges that McDonald's USA is jointly responsible with local franchisees for unfair labor practices allegedly committed at local stores during or in response to protests by fast-food workers.

Witnesses began giving testimony in the cases on March 10 in New York , but the subpoena dispute dates back approximately a year.

ALJ Lauren Esposito issued orders in April 2015 revoking in whole or in part subpoenas that McDonald's had served on the charging unions, as well as firms and an organizer that participated in the fast-food protests.

Response to Protests an Issue

Pearce and Hirozawa said the general counsel alleges in part that McDonald's USA coordinated or directed the response of local franchisees to employee protests that constituted protected concerted activity under the National Labor Relations Act.

That coordinated activity tends to prove the existence of a joint employer relationship between the national franchiser and the local franchisees, the government contends. McDonald's denies the joint employer allegation.

The board said McDonald's has promised to offer two defenses: a factual defense that it did not direct franchisees and a legal defense that it engaged in legitimate “brand protection” against a nontraditional campaign that was threatening its reputation and good will.

Board Backs ALJ Ruling on Documents

The board said the ALJ properly found the subpoenaed documents are not relevant to the general counsel's joint employer allegation or to the brand protection defense.

The information McDonald's sought would not aid in determining whether McDonald's and franchisees shared or codetermined employment conditions, the board majority said.

The board also wrote that while the franchiser claims “it took certain actions to protect its brand in response to what it reasonably perceived was an attack on its brand,” the company's motivation may be relevant to its proposed defense, “but the actual motive of SEIU and the other Charging Parties is not.”

Pearce and Hirozawa said the ALJ has not precluded McDonald's from presenting its brand protection defense based on its perception of the protest campaign, but she properly exercised her discretion to revoke the disputed subpoenas.

Dissent Says Premature to Weigh Defense

Miscimarra said he agreed with some of Esposito's subpoena rulings, but he said the ALJ referred to the brand protection defense as “convoluted” and she may have prematurely rejected the defense.

He dissented from ruling McDonald's could not subpoena information relevant to the defense, which he said can only be “appropriately evaluated” after the conclusion of the unfair labor practice hearing.

Attorneys, including a number involved in the unfair labor practice proceeding, did not immediately respond to requests for comment.

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

To contact the editor responsible for this story: Susan J. McGolrick at smcgolrick@bna.com