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Labor Issues

Legislative Issue Update - July 2010

No labor legislation of any significance has been enacted – and little even considered – since the President signed the Lilly Ledbetter bill into law early in his Administration. The leaders of organized labor are acutely aware of that fact, and the tense relationship between the Obama Administration and those labor leaders that we described in these reports in January has not improved.

Labor still calls the Employee Free Choice Act its top priority, but there is no serious discussion of moving that bill in this Congress, the President gives it lip service at best, and there’s little expectation that it could muster the 60 votes necessary for passage in the Senate were they to take it up. While labor did win a concession in the health care bill when they modified the legislation to exempt most union-negotiated health insurance plans from the “Cadillac tax” on high-value insurance plans, that’s little to show legislatively for the hundreds of millions of dollars labor unions spent helping to elect President Obama and huge pro-labor majorities in both houses of Congress.

But while labor has few legislative victories, the pro-labor assault on the American workplace has manifested itself aggressively in the regulatory arena.

Becker Nomination to the NLRB:

Let’s start with the President’s nomination of Craig Becker to the NLRB – the government agency tasked with overseeing union organizing campaigns and labor-management relations.

Mr. Becker was Associate General Counsel for both the AFL-CIO and the Service Employees International Union (SEIU). He has written extensively on labor issues, creating a paper trail of alarmingly radical pro-union views. He wrote that secret ballots in union organizing campaigns “are profoundly undemocratic.” And that workers should not have the option of remaining non-union. And that employers should “be stripped of any legally cognizable interest in their employees' election of representatives." And that unions should be permitted to "bypass the union election and to gain union recognition outside the NLRB-supervised electoral process."

His views were so radical – it was believed he would try to impose the Employee Free Choice Act through the NRLB rule-making since it was stalled in Congress – that the Senate, in a rare move, affirmatively defeated his nomination to the NLRB.

But the President appointed Mr. Becker to the Board while the Congress was not in session, and Mr. Becker will remain on the Board under this “recess appointment” until the end of NEXT year. Even more troubling, the President also recess appointed the other Democrat Board whose nomination was before the Senate, but did NOT appoint the single Republican nominee whose appointment was also pending. With those actions the President would have created a Board with 3 Democrat-appointed members and not a single Republican nominee on the Board to even voice a dissenting opinion.

In a surprise move late last month, despite the President’s partisan attempt to ensure a Democrats-only Board, the Senate officially confirmed the nominations of both the other Democrat whom the President had recess appointed and the Republican nominee. With the Senate action, the Board will have a 3-1 Democrat majority, and Mr. Becker now remains the only Board member serving as a recess appointee whose term will expire at the end of 2011.

NLRB Rulemaking and Opinions

Business will be watching the newly-appointed NLRB very closely, anticipating labor-friendly rule-making, and concerned that they will attempt to implement the provisions of the Employee Free Choice Act (EFCA) through that rule-making.

Living up to those fears, the Board has already issued a “request for information” on electronic voting to determine whether employees could and/or should be allowed to vote in a union organizing election electronically and from a remote location. The possibilities for worker intimidation under a remote-voting scenario are obvious and dangerous.

Other areas of potential rule-making that the business coalitions are watching include –

  • Shortening the time in which elections must beheld, the so-called “quickie elections” proposal;
  • Requiring all employers to post notice of employee rights to organize similar to the notice now required to be posted by covered federal contractors;
  • Premise access for union officials during an organizing campaign;
  • Granting unions the right to use employer email records during an organizing campaign.

In addition to these possible areas of rule-making, business is also watching closely to see what the current Board may do in issuing rulings on cases. This is of particular concern after the recent Supreme Court ruling that the Board cannot make decisions without at least 3 sitting Board members, throwing into doubt the outcome of the 600-or-so cases decided during the more-than-two years during which the Board consisted of only two members (with three vacancies).

Department of Labor regulatory agenda:

The Dept of Labor (DoL) is likely to be a major battleground this year as well, and the philosophy Labor Secretary Hilda Solis brings to her task raises serious concerns in the employer community. Quoting the Secretary: “We are committed to ensuring that workers are paid a fair wage, have a voice in the workplace, are provided a safe workplace and have a secure retirement. . . . We will not rest until the law is followed by every employer, and each worker is treated and compensated fairly.”

The Department has just released its Spring 2010 Regulatory Agenda, which describes the mission of the Department as well as their specific regulatory plans.

New this year is a broad, wide-ranging assessment by the Department that while many companies take proactive steps to comply with the law and protect their workers’ health and safety, many others operate on a “catch me if you can” philosophy and do not comply until and unless they are caught in violation of their regulatory obligations. According the the DoL’s agenda: “Even with the recent addition of hundreds of new enforcement personnel and the proposal in the President’s latest budget to restore staffing in the Department’s worker protection agencies to levels not seen in almost a decade, assuring compliance throughout the American economy is a very difficult challenge,”

Acting on their belief that many companies will fail to comply with safety regulations unless forced to do so, the Department “seeks to change behavior” of employers, to “foster a wide-ranging culture of responsibility and compliance” and to “foster a new calculus that strengthens protections for workers.”

They call their new initiative “Plan/Prevent/Protect,” and its objective is to have employers “find and fix” violations before they see inspectors at their doorsteps. Their new initiative will, for all intents and purposes, require all employers to provide the Department with a blueprint highlighting for the government any areas in which the employer may be falling short of its regulatory obligations.

To achieve that objective, employers will be required to prepare a plan identifying areas in which they may not be in compliance so they can initiate self-enforcement of labor regulations, create processes for acting on the plan including assigning staff to its implementation, and evaluate the effectiveness of their plans in “achieving compliance. According to the Department: “While the Labor Department can be flexible about which path is chosen to achieve compliance, compliance will be non-negotiable.”

Implementation of the Plan/Prevent/Protect initiative will require all employers to “take three steps to ensure safe and secure workplaces and compliance with the law” – even if the employer has a perfect safety record and no citations or violations. The demands on employers from this new PPP plan are very specific:

Plan: “The Department will propose a requirement that [regulated entities] create a plan for identifying and remediating risks of legal violations and other risks to workers.” Employers would be required to involve workers in developing the plan, and the final plans must be made available to workers so they can help “monitor their implementation.”

Prevent: “The Department will propose a requirement that [regulated entities] thoroughly and completely implement the plan.” A plan on paper will be insufficient and deemed non-compliant.

Protect: “The Department will propose a requirement that the [regulated entity]ensures that the plan’s objectives are met on a regular basis. Just any plan will not do. The plan must actually protect workers from violations of their workplace rights.”

“Employers and other regulated entities who fail to take these steps to address comprehensively the risks, hazards and inequities in their workplaces will be considered out of compliance with the law and, depending upon the agency and the substantive law it is enforcing, subject to remedial action.”

In addition to this broad, across-the-board regulatory mission, here’s a sampling of the specific regulations in store:

OFCCP: (office of Federal Contract Compliance)

  • Affirmative Action and Nondiscrimination Obligations of Contractors and Subcontractors: to require that Federal contractors and subcontractors conduct more substantive analysis of recruitment and placement taken under the Vietnam Era Veterans Readjustment Assistance Act and to require the use of numerical targets to measure the effectiveness of affirmative action initiatives. Notice of Proposed Rulemaking (NPRM) expected in December 2010.

OLMS: Office Of Labor Management Standards

  • The OLMS has just published final regulations requiring covered contractors and subcontractors to post a Notification of Employee Rights Under Federal Labor Laws (see report on this rule in our Legal Update)
  • Persuader Agreements: Under the Labor-Management Reporting and Disclosure Act (LMRDA), employers must publicly disclose any agreement they have with a consultant hired to persuade employees as to their collective bargaining rights, but they are not required to report fees paid to a consultant for advice alone. DoL will attempt to narrow the current definition of “advice” to require more disclosure and reporting so that employees have a “more transparent view” of what the employer is doing. NPRM is expected in November 2010.

Wage and Hour Division

  • Records to be kept by employers…Under Fair Labor Standards Act (FLSA): DoL proposes to update the recordkeeping regulations to require employers to share payroll records with employees to “foster more openness and transparency” by demonstrating to the employees their employer’s compliance with minimum wage and overtime requirement, and to “enhance the transparency and disclosure to workers of how their pay is computed.” NPRM expected in August 2010.

OSHA

  • OSHA is hiring 100 additional inspectors, and reportedly incentivizing inspectors to find citations which carry the largest fines;
  • Developing a new rule requiring employers to implement an Injury and Illness Prevention Program – this so-called I-2, P-2 rule will implement the Plan/Prevent/Protect program described earlier in this report. Initial stakeholder meetings are expected this summer.
  • Walking Working Surfaces and Personal Fall Protection Systems (Slips, Trips and Fall Prevention): to update the requirement that employers provide personal fall protection systems…. NPRM May 2010; deadline for comments in August.
  • Occupational Injury and Illness Reporting Requirements – to require a new reporting column for Musculoskeletal Disorders. NPRM comments were required by March 30th, with a final rule expected this month.

Labor and the White House are also discussing new rules to give unionized employers an advantage in obtaining federal contracting. Called the "High Road Contracting Policy," it would require the DOL (and all federal agencies) to create new bureaucracies to assess the labor-friendliness of bidding contractors.