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NAW News

Legal Update

- June 2011

Attorneys General for 16 States Support Boeing in Unprecedented NLRB Complaint

The Attorney General for South Carolina, Alan Wilson, and his counterparts from fifteen other states have filed an amicus curiae brief with the National Labor Relations Board, in support of The Boeing Company in the NLRB’s proceedings against the aircraft producer. According to Mr. Wilson, “Unless deterred, the NLRB’s unprecedented proceedings against a company’s private business decisions will cause irreparable harm to the business climate in every state and will undoubtedly create an exodus of jobs from our country.”

The opposition to the NLRB complaint comes from right-to-work states (AL, AZ, FL, GA, ID, KS, NE, OK, SC, SD, TX, UT, VA and WY) and two non-right to work states (CO and MI). The remaining right-to-work states are AR, IA, LA, MS, NV, NC, ND and TN. Federal labor laws guarantee a state’s right to enact a right-to-work law that prohibits forced union membership and dues payment as a condition of employment.

Background:

On April 20, 2011, the NLRB acting general counsel filed a complaint against Boeing, accusing it of illegal retaliation for past union strikes at its facilities in Puget Sound, Washington. The complaint charges that the company violated federal labor laws when it decided to build a non-union plant in South Carolina (a right-to-work state) as a second production line for its 787 aircraft, instead of expanding its unionized facilities in Washington State. The complaint requests an NLRB order that requires Boeing to halt production of 787 aircraft at the new South Carolina plant and transfer the work to the unionized workforce at the Washington facilities. The NLRB general counsel filed this action a year and a half after Boeing began constructing the South Carolina facility.

Boeing denies the allegations and responds that its decision was based upon a host of business considerations, comparative labor costs of competing states, financial incentives offered by South Carolina and the national security benefits of multi-plant production capability.

The States’ amicus brief notes that Boeing has added over 2,000 union jobs in Washington State since deciding to build the South Carolina plant and warns that the NLRB’s eagerness to impute anti-union animus to a private business decision will discourage private sector job creation in right-to-work states. In fact, according to the brief, the enforcement action sought by the NLRB general counsel will harm the very U.S. workers (whether union or non-union) the NLRB is charged to protect—by encouraging U.S. employers to move operations outside the United States, beyond the NLRB’s reach.

An administrative law judge commenced a hearing on this complaint on June 14, 2011 which could last several weeks. An appeal from the judge’s decision to the NLRB in Washington, D.C. is virtually certain. The final decision of the NLRB in this case is subject to review by the federal appeals court and the U.S. Supreme Court.


Court Expands Anti-Retaliation Prohibition in Federal Employment Discrimination Law

Title VII of the Civil Rights Act prohibits employment discrimination based upon race, color, gender or national origin. The law also prohibits employer retaliation against a person who complains of illegal discrimination. Miriam Regalado filed a complaint with the Equal Employment Opportunity Commission (EEOC), charging her employer with sex discrimination. Three weeks later the employer fired Ms. Regalado’s co-worker – and fiancée – Eric Thompson. Mr. Thompson filed a lawsuit alleging that his discharge was in retaliation against Ms. Regalado, to punish her for filing the EEOC charge of discrimination.

Thompson’s lawsuit was dismissed by the lower courts on grounds that Title VII does not permit third-party retaliation lawsuits. But in a unanimous decision the U.S. Supreme Court reversed and held that the anti-retaliation provision in Title VII is broad enough to include third-party retaliation. (Thompson v. North American Stainless, Docket No. 09-291). According to the Court, it stands to reason that an employee such as Ms. Regalado would be reluctant to pursue a charge of discrimination if she knew that her employer could lawfully fire her fiancée in reprisal. That element of intimidation was enough to bring this case within the broad anti-retaliation protection afforded under Title VII.

The Supreme Court acknowledged that the protection will not extend to every adverse employment action that may be taken against any employee who is somehow connected to a co-worker who files a charge of discrimination. The Court declined to identify with precision a fixed class of relationships for which third-party reprisals are unlawful, but did comment that firing a close family member is probably unlawful while inflicting a milder reprisal on a mere acquaintance probably will not be unlawful. Lines will be drawn in the lower courts for years to come before employers will have more definitive guidance.

The Court’s decision is consistent with the EEOC’s long-standing interpretation of Title VII. Cases involving adverse employment actions against close relatives and significant others have been allowed to proceed in some federal appellate court jurisdictions and not allowed in others. After the Court’s decision, the next question is how close of a relative or how significant an “other” does one have to be in order to proceed with a retaliation lawsuit.

In 2010, for the first, the volume of retaliation claims filed with the EEOC exceeded the number of claims based upon race. The Thompson decision is expected to further increase the number of retaliation charges filed by employees.


Labor Department Launches New “Time Sheet App” for Employees to Track Their Hours Worked

Employees can now track their hours worked, using a free app offered by the U.S. Department of Labor. The app is compatible with the iPhone and iPod Touch and may be expanded to other smartphone platforms. In announcing the new tool, the Labor Department stresses that workers can now keep their own time records for hours worked and overtime hours, instead of relying on the employer’s records. Information on the app and how it works can be found on this link from the Department of Labor: http://itunes.apple.com/us/app/dol-timesheet/id433638193?mt=8.

A printable work hours calendar is also available from the Labor Department for workers without smartphones: http://www.dol.gov/whd/FLSAEmployeeCard/calendarR5Web.pdf. The calendar includes information on workers’ rights and how to file a wage violation complaint with the Department’s Wage and Hour Division.

Under the Fair Labor Standards Act, unless an employee is “exempt”, the worker must be paid overtime (at least time-and-a-half the regular rate of pay) for time worked more than 40 hours in a work week. Exempt employees are generally salaried workers who qualify under Labor Department regulations as a bona-fide executive, administrative, professional, computer or outside sales personnel. (See Department of Labor regulations, 29 CFR Part 541). All other workers are “nonexempt”, and thus must receive overtime pay for hours worked in excess of 40 per workweek.

The new app likely will produce more employee challenges to the employer’s records for hours worked and overtime-eligible hours. Worker complaints filed with the Wage and Hour Division have been on the rise and this trend is expected to continue. Wholesaler-distributors are well advised to review their recordkeeping systems to assure that the hours worked by their workforce are accurately recorded.