National Labor Relations Board: Labor Day Roundup
While much of the country spent the last week of summer enjoying the last few days of sun, the National Labor Relations Board spent the week before its eponymous three-day weekend churning out a couple of important decisions.
A brief round-up of the Board’s recent activity in areas related to the intersection of Section 7 rights and independent contractors or non-employees, including related to leafletting and misclassification issues, is discussed below.
Employers Can Legally Prohibit Non-Employees From Leafletting on Their Premises –Bexar County Performing Arts Center Foundation d/b/a Tobin Center for the Performing Arts and Local 23, American Federation of Musicians, Case 16-CA-193636 (N.L.R.B. August 23, 2019)
On August 23, the Board set new precedent, deciding that an employer can legally bar non-employees from leafleting on the employer’s premises even if those non-employees work for an on-site contractor.
The decision comes after an Administrative Law Judge (ALJ) ruled that the Bexar County Performing Arts Center Foundation illegally blocked members of the San Antonio Symphony from leafletting on the Center’s premises. Though the members were Symphony employees, the Symphony used the Center for roughly 80% of its rehearsals and performances. The dispute arose when members attempted to pass leaflets during a performance, criticizing the Ballet’s use of recorded-over live music. The Center kicked them off the property.
The Board disagreed with the ALJ. A majority of NLRB Chairman Ring and Members Emanuel and Kaplan found that contractor non-employees are not entitled to the same NLRA Section 7 access rights as statutory “employees are, and thus they are not entitled to the same access and protections. The decision reverses prior cases holding the opposite, such as New York New York Hotel and Casino, 356 NLRB 907 (NLRB March 25, 2011) and Simon DeBartolo Group, 357 NLRB 1887 (NLRB December 30, 2011), which the current Board concluded wrongfully limited an employer’s Constitutional property rights.
In her dissent, Member McFerran criticized the majority for not only “scal[ing] back labor law rights for…employees who work regularly on property that does not belong to their employer,” but also for reversing precedent without any public input.
Overall, the ruling allows employers the right to prevent non-employees from leafletting on their premises. However, the Board did carve-out workers who are not employed by the property owner but work “regularly and exclusively” on said property, without other “reasonably nontrespassory” ways of advocating their position, who must be permitted access.
Misclassifying Workers Does Not Violate the NLRA – Velox Express, Inc. and Jeannie Edge, Case 15-CA-184006 (N.L.R.B. August 29, 2019)
On August 29, in an anticipated decision, the Board held that an employer that misclassifies employees as independent contractors does not violate the NLRA.
In this case, Velox Express misclassified its employees as independent contractors, and an ALJ found that doing so violated the Act because independent contractors inherently fear reprisal for asserting protected rights reserved for employees. The Board’s majority of NLRB Chairman Ring and Members Emanuel and Kaplan disagreed. While the Board confirmed that Velox Express misclassified employees as independent contractors, the majority did not agree that misclassification alone interfered with Section 7 rights.
The Board reasoned that independent contractors can still collectively act, and it is not until an employer responds to such collective action with “threats, promises, interrogations, and so forth” that the employer violates Section 8(a)(1) of the NLRA. For this reason, the Board agreed that Velox Express did violate the Act when it fired driver Jeannie Edge for complaining about the misclassification. In her dissent, Member McFerran argued that “misclassification itself chills” workers’ Section 7 rights and that misclassified workers would fear retribution for acting inconsistently with their signed agreements, which in this case classified them as independent contractors.
This expected decision will relieve one potential risk for businesses when undertaking the fact-intensive and often difficult decision regarding worker classification. Now, as long as employers do not subsequently retaliate or threaten misclassified workers, there is no liability under the National Labor Relations Act for alone incorrectly classifying workers as independent contractors rather than employees.