Several recent cases dramatically illustrate the need for careful company drafting of its employment policies, even though some are not related to employee handbooks. Almost every employer, for legal reasons or otherwise, has posted policies dealing with workplace harassment and leave policies under the Family and Medical Leave Act (FMLA). In a recent case against Costco, the employer had a published employment policy dealing with harassment. The policy not only prohibited "unlawful" harassment, but further provided that "appropriate corrective action will be taken, regardless of whether the inappropriate conduct rises to the level of any violation of law." The policy went on to define harassment in a very broad manner. In this case, the plaintiff’s allegations of harassment were outside the statute of limitations, and accusations within the statute of limitations were relatively minor. Despite the lack of "unlawful" harassment, the court found that the employer’s posted policy amounted to an express or implied contract between the employer and the employee, particularly since the policies did not contain any disclaimer language to the effect that its "super" anti-harassment provisions do not create legally enforceable protections beyond the protections of background law. Marini v. Costco Wholesale Corp., 30 AD Cases 1876 (D. Conn. 2014).
In another case, an employer’s FMLA policy indicating that all full-time employees would be eligible for leave under the FMLA was sufficient evidence of a claim for equitable estoppel (coverage) under the FMLA. The employer argued that the employee was not actually eligible under the FMLA as the employer had not met the employee threshold under the law. The court rejected the employer’s argument, finding that the employee had reasonably relied on the policy statement addressing FMLA eligibility. Tilley v. Kalamazoo County Road Commission, 125 FEP Cases 1696 (C.A. 6, 2015). Thus, employers should be cautious making broad statements that employees are covered under the FMLA when they are at work locations of less than 50 employees within a 75-mile radius, or otherwise have not met the statute’s hours worked threshold.
In the final example, in December of last year, the Pennsylvania Supreme Court affirmed a $151 million award to Wal-Mart employees who filed a class action claiming missed or interrupted meal breaks and rest periods. The employees argued that the employer would not allow them the breaks they were promised in published company policies, and did not compensate them for the extra time worked. While neither federal nor state law required Wal-Mart to provide workers with the breaks that were involved in the lawsuit, the company policy stated that employees were eligible for specific meal and rest periods, and Wal-Mart was thus under a contractual obligation to provide them and to compensate employees for any missed or interrupted meal breaks or rest periods. Braun v. Wal-Mart Stores, Inc., 106 A.3d 656 (Pa. Supreme Ct. 2015).
Editor’s Note: The drafting of company personnel policies continues to create dilemmas for employers. The NLRB is claiming that overbroad company policies may infringe on protected employee activities such as unionism by "chilling" the rights of employees to engage in such activities. Without careful drafting, courts in some states are finding company policy language to be contractual and binding, even in those situations where no federal rights are involved. Almost every employer has some type of harassment policy and/or leave policy, and even the use of broad language can open up legal issues, as suggested by the foregoing cases. Unless the current legal environment changes, employers should have competent labor and employment law specialists review their policies, particularly those on sensitive subjects.
During March, for only the second time in history, both Houses of Congress approved a resolution under the Congressional Review Act disapproving the controversial "quickie" or "ambush" union election rule. The Senate adopted the disapproval resolution of the NLRB action on March 4 by vote of 53-46, and the House passed an additional measure on March 19 by a vote of 232-186. On March 31, President Obama vetoed the joint congressional resolution. The Senate vote is 14 votes shy of the total needed to override the President's veto. Therefore, the NLRB rule went into effect as scheduled on April 14. While there are two lawsuits pending challenging the legality of the new NLRB rule, in neither case has the court scheduled a hearing or made a ruling. In any event, the blocking of the rule through litigation is probably a long shot.
Regarding the issue, Sen. Lamar Alexander, Chairman of the Senate Labor Committee, responding to the Senate resolution, said in a statement after the Senate vote that the NLRB rule changes would "allow a union to force an election before an employer has a chance to figure out what's going on." On average, it currently takes about 38 days after a union petition is filed with the NLRB for a union election to take place. No one knows, not even the NLRB, how soon elections will be held in the future, but estimates vary between two and four weeks after the filing of the petition.
Implementation of the quickie election rule, together with the recent NLRB ruling in Purple Communications, Inc., creates enormous issues for employers regarding electronic communications. Under the quickie election rule, the employer will have to provide a voting list to the union, which will include among other things personal phone numbers and email addresses, if available to the employer. In its Purple Communications ruling, the NLRB has adopted a presumption that employees who have been given access to the employer's email system in the course of their work are entitled to use this system to engage in statutorily protected discussions about the terms and conditions of employment while on non-working time. In the past, unions have often had great difficulty communicating with employee-voters, because of the effort and expense involved. Now, in just a few minutes, union organizers may have the ability to communicate with the entire list of voters.
Editor's Note: The unions are likely to take advantage of the new rules to give them access to employees' personal telephone numbers and email addresses to engage in different forms of organizing that will be much less costly and more efficient for them. The Purple Communications ruling is currently the law of the NLRB, and thus employers would be wise to review and likely revise their electronic communication policies to be consistent with the ruling. A particularly important issue is the extent to which employers can monitor employee communications on its email system. Some type of monitoring will likely be appropriate, but advice of counsel will be necessary. Further, it is going to be very difficult to monitor when someone is engaged in these communications because the decision only applies to non-working time.
The Wage and Hour Division of the U.S. Department of Labor must allocate its resources just like other organizations. For many years, it has tried to focus on industries where it believes there is systematic or prevalent problems, and also those industries in which the employees are least likely to complain because of their vulnerability. One casualty is that recently Wage-Hour ceased issuing opinion letters, although they will continue to issue administrative interpretations. The agency is currently working on revising the overtime regulations, reportedly to greatly increase the necessary requirements to meet the "white collar" exemptions from overtime pay.
An issue recently emphasized by newly appointed wage-hour administrator David Weil is to address situations where a business controls the core work done by an outside organization, with possible expansion of the joint employment doctrine. That is, both Wage-Hour and the National Labor Relations Board seem to be expanding the situations in which a joint employer finding will occur when two entities directly or indirectly have the power to determine the essential terms and conditions of employment of certain workers.
In a little-noticed NLRB announcement during April, the Labor Board is seeking input on a union fund raising initiative that has long been deemed illegal under federal labor law, at least since 1947. Unions are arguing that they should be allowed to charge non-members fees for handling grievances involving their employer, even though the union is representative of all bargaining union employees under the federal labor law, whether they are union members or not. In other words, the unions are arguing that if you don't put pay us in union dues, you need to pay us for representing you if we handle your grievance. This would be a rather revolutionary way in which such matters are handled, and the fact that the NLRB is requesting input on the issue suggests the NLRB is considering another dramatic change in the law. The case is Buckeye Florida Corporation, a subsidiary of Buckeye Technologies, Inc., and Georgia Pacific, LLC, Case 12-CB-10954. In that case, administrative law judge William Nelson Cates issues a decision on March 24, 2014, finding that the union violated Section 8(b)(1)(A) by maintaining and implementing a "fair share policy" requiring non-member bargaining union employees to pay a grievance processing fee. The union asked the NLRB to adopt a rule allowing unions to charge non-members a fee for grievance processing. On April 15, 2015, the NLRB invited the filing of briefs in order to allow other interested persons the opportunity to address the following question: "Should the Board reconsider its rule that, in the absence of a valid union-security clause, a union may not charge non-members a fee for processing grievances?" The due date for filing such briefs has recently been extended until July 15. The law judge in the case was recommended for his position by Jim Wimberly.
Unions argue that right-to-work laws make it harder to form and maintain unions, and encourage "free riders" who receive benefits of collective bargaining without paying for them. In making such arguments, the unions forget that they themselves were the origin of the principal of "exclusive representation" that unions represent all employees covered by a bargaining relationship and/or a collective bargaining agreement, whether such employees are paying union dues or not.
Such an approach as advocated by unions is not without risk to them. Employers argue during union organizational campaigns that employees will incur the costs of the union dues by voting in the union. In right-to-work states, the unions respond that such statements are false, as employees can elect whether or not to be union members and pay union dues. Thus, if the current union initiatives should become law, employees will end up paying for a union whether in a right-to-work state or not.
On March 9, 2015, Gov. Scott Walker signed legislation making Wisconsin the 25th right-to-work state, saying the new law demonstrates that his state is "open for business." Wisconsin joined two other states in enacting a right-to-work law, Indiana and Michigan, as each passed such laws during 2012. Similar bills were introduced in some 20 states last year, and this year such bills have been introduced in Missouri, New Hampshire, New Mexico and West Virginia. President Obama responded negatively to the legislation, stating he is "deeply disappointed" in this "anti-worker" law that allows employees in union workplaces to back out of paying union dues.
Some efforts to pass right-to-work legislation has actually shifted to the local level. Last December, Warren County, Kentucky, became the first U.S. county to pass a right-to-work law. Several other Kentucky counties quickly followed. Unions have sued to overturn such legislation, contending that federal labor law only allows right-to-work law at the state level. Illinois Gov. Bruce Rauner has proposed legislation to allow voter referendums for county or municipal right-to-work, but the Illinois attorney general says such approaches are illegal. Last year Maine Gov. Paul LePage proposed offering business owners a right-to-work policy that would apply to any large company that promised to make major investments and add large numbers of jobs.