Delivering for Best-in-Class Wholesaler-Distributors
March 8, 2019

The Department of Labor (DOL):

During the eight years of the Obama Administration, DoL and the National Labor Relations Board (NLRB) were among the most aggressive federal agencies, successfully advancing a pro-labor agenda with often-publicly-stated anti-business bias.

The Trump Labor Department got off to a slow start, with Secretary Alex Acosta not taking office until April, 2017, the last of the Cabinet members to be confirmed. In addition, key positions in the agency remained vacant for another year.  Moreover, the Department has been subject to some criticism from the business community for the slow pace at which they are moving to implement policy initiatives.  Nonetheless, despite the late start and slow pace, the Department has undertaken some key major policy initiatives.

The FLSA/Overtime Rule: After months of delays, late last week the Trump Labor Department finally released a new Notice of Proposed Rulemaking (NPRM) on a new overtime rule.  Their rule will formally rescind the Obama rule, a step necessary to ensure that there could be no retroactive enforcement of that rule.

While we are just beginning to review the new NPRM, a few details are notable.  First, they are proposing a threshold salary for qualifying for the “white collar exemption” of $35,308 – significantly lower than the $47,000 proposed in the Obama rule.  Also, they do not propose automatic increases in that salary without any rulemaking or public comment, as the 2015 rule did.

NAW has filed comments multiple times on this issue, based on the invaluable input we received from member companies on how the proposed rules would impact them.  We will review this new rule and again reach out to our member companies to better understand how each of the provisions in the new rule will impact them.

Click here to review the new NPRM.

The Persuader rule: The Obama Administration DOL’s Persuader rule – which would have made it difficult for an employer to obtain advice and/or legal counsel during a union organizing campaign – was enjoined in late 2016 by a federal court in Texas.

In May, 2017, DoL sent to the Office of Management and Budget’s (OMB) Office of Information and Regulatory Affairs (OIRA) a new proposed rulemaking rescinding the Persuader rule. Under the standard process, OIRA reviews a new rule and, assuming they approve it, the regulating agency then publishes the proposed rule in the Federal Register and opens it up for public comment.

OMB/OIRA completed its review of the rescission rule on June 6, 2017, and on June 13th DoL’s Office of Labor-Management Statistics issued a new notice of proposed rulemaking (NPRM). The public comment period on the rescission rule ended on August 11, 2017.  NAW participated in this new rulemaking through the Coalition for a Democratic Workplace.

A final rule rescinding Persuader was issued on July 17th, 2018.

OSHA “Walk Around Rule:” In February, 2013, the Occupational Safety and Health Administration issued a controversial “opinion letter” announcing that a non-employee union representative could accompany an OSHA official in an inspection of a worksite even if the company is not unionized and has no collective bargaining agreement. In early May, 2017, just weeks after Secretary Acosta’s confirmation, the OSHA directive was rescinded.

The National Labor Relations Board (NLRB):

Like the Department of Labor, the National Labor Relations Board got off to a slow start in the Trump Administration. The Board is a five-member independent agency on which there must be at least three seated members for them to conduct business.  There were only three seated Board members when President Trump took office, two Democrats and one Republican, leaving the Democrats with majority control of the board until President Trump nominated and the Senate confirmed individuals to fill the two vacancies.

The President did not nominate new Board members until mid-June, 2017, and it was late September that year when the Senate finally confirmed the second of the nominees, giving the GOP a working majority on the Board a full eight months into the Administration. In November, 2017, the Senate confirmed Peter Robb to fill the Board’s powerful General Counsel position, and for the first time in a decade the GOP had full control of the Board.

But that was short-lived. GOP Chairman Miscimarra had already announced that he would not seek a second term on the Board; when his term expired last December his seat became vacant and the Board was back to a 2-to-2 tie.  It wasn’t until April, 2018, that a third Republican member was confirmed by the Senate, restoring a 3 to 2 GOP Board majority.

The Republicans quickly began the process of reversing Obama-era rules and precedents. In addition to the Board actions, the new General Counsel aggressively and effectively joined the effort, issuing a memorandum that promised dramatic reversal of Obama-Board actions.

Specific actions of the Trump-appointed Board:

Joint Employer: The Obama Board radically changed the standard on what constituted a joint employer for purposes of labor union organization, reversing the long-held standard that an employer had to have direct control over the terms and conditions of employees to be considered a joint employer. The Obama Board changed that standard to one in which “indirect control” is sufficient for joint employer status (in which employees can be included in a collective bargaining unit without the consent of both employers).

The Trump Board initially voted to reverse the Obama Board’s standard, then as a result of complicated internal divisions, vacated that decision. Subsequently, in May, 2018, Board Chairman John Ring announced that the Board would propose a formal regulation to create a new Joint Employer standard. NAW has participated and will continue to participate in this rule-making through the Coalition for a Democratic Workplace, which we help manage.   Based on Board actions and comments in recent months, the business community is optimistic that a new rule will restore a “direct control” Joint Employer standard.

The “Ambush Election Rule:” The Board published a Request for Information seeking comment on whether the Obama Board’s Ambush rule – which facilitated faster union certification elections and limited employer rights in the process – should be retained without changes, retained but modified, or rescinded.  NAW joined allied associations in submitting comments on the RFI, and joined an amicus brief on the issue in October, 2018.

Specialty Healthcare: The Board reversed the “Specialty Healthcare” decision which had facilitated the creation of “micro-bargaining units” within a single workplace, restoring the “community of interest” standard that had been used for decades to determine appropriate collective bargaining units.

Employee Handbook Rules: The previous Board greatly increased the Board’s reach into even non-union workplaces by expansion of so-called “protected concerted activity,” holding employee handbook rules invalid if the rule could conceivably be interpreted by an employee as impacting his/her right to participate in collective bargaining activity.  In December, 2017, the Board established a more balanced – and employer friendly – test, and in June, 2018, the General Counsel issued a comprehensive new guidance for Board decisions on employee handbook rules.

Employee access to employer email: In 2014, in the Purple Communications case, the Obama Board held that employees who have access to their employer’s email system for work-related purposes have the right to use that employer’s email system for non-work-related purposes, including union organizing activity.  On August 1, 2018 the Trump Board announced it was inviting briefs on whether they should adhere to, modify or overrule Purple.  They also expanded the issue to evaluate policies governing employee use of other employer-owned computer systems.  In October, 2018, NAW joined an amicus brief in a case, Caesar’s Entertainment, which will reverse the Purple standard if successful.

In addition to these and other specific Board actions, General Counsel Peter Robb issued a Memorandum on December 1st, 2017, in which he outlined controversial decisions of the Obama-era Board and opened the door for reconsideration of those decisions.  In addition to the issues described above, GC Robb made note of:

  • Decisions requiring that employers provide access to work premises to off-duty employees;
  • Expansion of the range of permissible conduct by union representatives;
  • Requiring an employer to provide witness statements to unions; and
  • Requiring an employer to continue dues check-off after the expiration of a collective bargaining agreement.

We fully expected a continued effort by the NLRB to reverse Obama-Board pro-labor rules and decisions, and restore balance to the Board policies.