Punching In: Two SCOTUS Decisions and a Barrel of Labor Dept. New Hires

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By Chris Opfer and Ben Penn

Monday morning musings for workplace watchers

Opt-In Options | Waiver Ruling Makes Waves| Labor Disputes: Board or Bench?

Chris Opfer: So, did I miss anything while I was on vacation last week?

I’m still parsing Justice Samuel Alito’s piercing majority opinion in Janus. What jumps out to me isn’t the smackdown on mandatory “fair share” union fees in the public sector-- that was expected. I predicted earlier this year that the next right-to-work fight would be over union opt-out procedures. Blue states like New York even updated their laws in advance of Janus to let public unions make it harder for workers to decide to opt out of membership by implementing strict time restrictions and other hoops to jump through.

Alito turned that debate on its head when he said public sector employees have to affirmatively opt in to union membership before labor organizations can start deducting dues.

“Neither an agency fee nor any other payment to the union may be deducted from a nonmember’s wages, nor may any other attempt be made to collect such a payment, unless the employee affirmatively consents to pay,” Alito wrote.

That sure sounds like public sector unions need to get all their existing members to sign some sort of opt-in form before they get dues deducted from another paycheck. It also sounds like the kind of thing the folks at the National Right to Work Legal Defense Foundation, which represented Mark Janus before the Supreme Court, will be watching closely.

“It seems to at least mean that as soon as a member wants to drop their membership they cannot be charged dues,” NRWLDF spokesman Patrick Semmens told me by email last week. “This should wipe out the various attempts unions had been engaged in to lock members into paying even after the Janus decision (and attempting to create limited windows outside of which they could not stop dues).”

The foundation got a second win last week, when SCOTUS one day after the Janus decision sent a similar case—Riffey v. Rauner—back to the Seventh Circuit. The high court wants an appeals panel to reconsider a group of home health care workers’ request for $32 million in fair share fees obtained by the Service Employees International Union before the justices struck down those fees in 2014 in Harris v. Quinn.

There was also another bit of SCOTUS news last week that may have been overlooked between the Janus decision and Justice Anthony Kennedy’s to retire from the bench. Bloomberg Law’s Jon Steingart reported that three members of the court said they’re interested in reconsidering how much deference judges should give to federal agency’s interpretations of the laws they enforce.

Neil Gorsuch, John Roberts, and Clarence Thomas said the court should weigh in on whether agency interpretations unveiled only in litigation—as in through a friend of the court brief—ought to get the same deference afforded to regulations issued through the notice and comment process. Of course, some folks inside the Trump administration may want the court to go one step further and reconsider whether regulations should be getting that deference in the first place. Critics say courts have allowed rogue agencies to use regulations to essentially make law without going through Congress and then given those regulations more weight than they deserve.

Ben Penn: Janus isn’t the only recent Supreme Court decision that has the labor movement and its allies licking their wounds. We’re still in the very early stages of understanding the ripple effects of the May 21 Epic Systems ruling that gave businesses the green light to require employees to pursue legal claims through arbitration, rather than in court.

The plaintiffs’ bar gathered in Chicago at the National Employment Lawyers Association annual convention late last week. The cumulative pain of the Janus/Epic/Kennedy news surely lent a more somber tone to the conference than usual, but also made its timing particularly necessary for strategizing next steps.

Tune back in later this week when I’ll be examining a path forward for one untested but commonly discussed strategy for workers’ lawyers to combat the Epic Systems decision.

In the meantime, now that we’ve had six weeks to digest that ruling, it’s time to look at whether more businesses are actually adopting class action waivers after the justices gave them permission to do so. Quite a few employers—especially large ones—already had waivers in place. And management firms have certainly been pushing clients without such agreements to at least consider the option since Epic.

Based on the early responses companies have been giving Jeff Brecher, who co-chairs the national wage-and-hour practice at management-side heavyweight Jackson Lewis, some employers that were resistant to waivers beforehand are now changing their tune.

“That issue has been percolating in the courts for so many years, but now that we have absolute clarity at least on the enforceability of those waivers, particularly under the FLSA, many, many employers are implementing such agreements,” Brecher told me, based on his firm’s recent discussions with clients.

It’s not at all surprising to see more businesses are keen on arbitration. We’re still exploring exactly how many more companies will push workplace claims to arbitration. What variables drive such decisions, how will they break the news to employees, and how will workers react to being told that their terms of employment have suddenly changed?

There are multiple chapters on the legacy of Epic Systems yet to be written.

CO: The partisan divide in Congress is usually on full display in the labor and employment space, where lawmakers rarely find much common ground beyond co-sponsoring the occasional job training bill. Curiously, though, in recent years we’re seeing some overlap among Republicans and Democrats in their criticism of the National Labor Relations Board.

Lawmakers on both ends of the spectrum have said that workers, unions, and employers should have the right to bypass the board and take their labor beefs directly to a federal court. Republicans like Reps. Glenn Grothman (Wis.) and Bradley Byrne (Ala.), a former labor lawyer, say maybe we don’t need a board at all. Sen. Bernie Sanders (I-Vt.) and Rep. Keith Ellison (D-Minn.) are among those on the left who’ve said keep the NLRB but give workers a private right of action to sue for unfair labor practices without having to go through the board first.

The argument for a direct path to court often centers on the flip-flopping routine that the NLRB has been known to go through when a new administration takes control, sharply shifting how the board views some of the most important legal questions in its jurisdiction. But board defenders point out that the vast majority of cases the NLRB handles are resolved before ever getting to the five-member board itself. The agency aims to get an initial determination within 12 weeks after an unfair labor practice charge is filed. That’s a lot faster than you can expect to get a decision in most courts, even if a regional office doesn’t always exactly hit that deadline.

Maybe that’s why Democrats left private right of action language out of their latest union election legislation, The Workplace Democracy Act, or “Card Check 2018.” The bill, which has no chance of passing in the current Congress but sets out the Democrats’ view of labor policy, makes it easier for unions to organize and imposes new requirements on businesses. But it doesn’t let anyone go directly to court to enforce them. Ellison, who’s a co-sponsor, also reintroduced a separate measure that would give workers a private right of action in unfair labor practice cases, like those alleging violations of workers’ right to engage in concerted activity on the job.

BP: The political vacancies that hampered the Labor Department’s productivity in Trump’s first year in office are dissipating. In addition to the arrival of more Senate-confirmed officials—with a few notable folks still waiting confirmation—there are also lower-level politically appointed aides quietly assuming new gigs at the Frances Perkins Building.

The department doesn’t actually announce these hires, so the new additions are implementing Labor Secretary Alex Acosta’s agenda at various agencies without the public having any idea who they are and what their backgrounds are in labor policy.

Here’s a brief rundown of some—and not close to all—of these Schedule C politicals, given titles such as “special assistant” and “policy adviser.” The resumes run the gamut of management law firms, GOP fundraising shops, Capitol Hill offices, and conservative think tanks.

The information below is based on my review of LinkedIn profiles. A DOL spokesman verified that the job titles these people posted in their personal bios are all accurate.

  • Pizzella’s team: Since arriving as the DOL’s No. 2 in April, Pat Pizzella has staffed up with a George Mason law student and Federalist Society member named Bob Minchin. It’s unclear if his duties as Pizzella’s special assistant will require Minchin to take a leave from law school. The deputy secretary’s counselor is Barrett Young, a former King & Spalding associate and Federalist Society associate director.
  • Tim Taylor: the Holland & Knight associate just recently arrived to DOL’s policy office as a senior counsel and policy adviser, per his LinkedIn profile. He was once chair of BYU College Republicans and then attended Harvard Law, where he was a member of—you guessed it—the Federalist Society.
  • Matt Mimnaugh: He joined the ranks in May as a special assistant at the Occupational Safety and Health Administration, fresh off a stint at Wells Fargo. Mimnaugh was previously a law clerk for the Republican National Committee and earned his JD from Boston College Law School with a FedSoc membership card.
  • J. Ross Stewart: He became a special assistant in Secretary Acosta’s office in June, after a career as a contracts administrator at Concurrent Technologies and an RNC field organizer in Pennsylvania. He holds a JD from the University of Pittsburgh School of Law.

CO: We’re punching out. Daily Labor Report subscribers can check in during the week for updates. In the meantime, feel free to reach out to us: copfer@bloomberglaw.com and bpenn@bloomberglaw.com or on Twitter: @ChrisOpfer and @BenjaminPenn.

It’s July, which means minimum wage hikes took effect in several states and local jurisdictions over the weekend. In addition, a new Massachusetts pay equity law and fresh fair scheduling requirements in Oregon are also officially on the books. If your work brings you to the center of the Sunshine State, look this week for Patrick Dorrian’s analysis of the Middle District of Florida.

See you back here next Monday.

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