Category: NLRB

January 18, 2023

Real Growth in Union Election Filings Entering 2023

The National Labor Relations Board began announcing an increase in union organizing activity in early 2022. More detailed analysis showed that those gains were primarily driven by elections at numerous Starbucks stores. Otherwise, the 2022 election statistics only suggested a return to pre-COVID levels. Now, however, statistics from the final three months of calendar year 2022, appear to reflect a general increase in union election filings entering 2023.

Starbucks Effect

Election petitions involving Starbucks stores accounted for an overwhelming proportion of the NLRB’s reported increase in union election filings in its fiscal year 2022 (from October 2021 through September 2022). For more, read Why Are Union Elections Increasing in 2022?

In NLRB FY 2022, there were 349 election petitions filed seeking union representation at Starbucks stores. To date, the union has won recognition in 223 cases and lost 48 times. Twenty-nine of the petitions have been withdrawn or dismissed for various reasons. Forty-nine of the cases remain open.

Excluding Starbucks cases, 1,345 union representation petitions were filed with the NLRB between January 1, 2022, and September 30, 2022. Though the numbers were much lower in 2020 and 2021 during the height of the COVID-19 pandemic, the same period in pre-COVID 2019 saw 1,329 union representation petitions filed. In other words, Starbucks-adjusted, there was only a 1% increase in 2022.

New Year Uptick

Entering 2023, continued increases in union representation elections seem to exceed any direct Starbucks or COVID impact.

Over the second half of NLRB FY 2022 (April-September), non-Starbucks union election petitions (922) were actually below the total for the same period in 2019 (943). The fourth quarter of FY 2022 (July-September) saw only a minimal increase from 453 to 464 compared to 2019.

Then, from October 1 through December 31, 2022, there were 437 union election petitions filed that didn’t involve Starbucks. That represents a 16% increase from the same “post-COVID” period in 2021 and a nearly 8% increase from the same pre-COVID period in 2019.

Note that Starbucks employees are still seeking representation at new stores. Thirty-six union representation petitions were filed between October and December 2022. Only 11 were filed during those months the previous year, when the Starbucks organizing campaign had just begun. But the Starbucks monthly filing rate has decreased to about a third of what it was in NLRB FY 2022.

Where Are Union Elections Becoming More Likely?

A few states substantially account for the recent increase in Starbucks-adjusted union representation petition filings. Due to differences in population and other factors, such as historical union activity, the typical number of petitions varies considerably between states. Thus, a proportional increase in filings in a given state will have a greater or lesser impact on the total number of election petitions filed nationwide.

First, let’s look at the total number of union representation petitions filed between October and December over the past few years in several notable states. These are listed in the chart below.

Union Election Petitions Filed Oct.-Dec.	2019	2020	2021	2022
California	52	51	47	74
DC	9	10	13	15
Georgia	5	0	3	7
Massachusetts	18	8	4	24
New York	67	40	42	54
Tennessee	1	1	2	5
Texas	9	8	7	17

Not surprisingly, California had the most petitions between October and December 2022. Conversely, Southern states Georgia and Tennessee had only about a handful. And Texas had relatively few compared to its overall population. However, these states had proportionally more union representation petitions filed in Oct.-Dec. 2022 than over the same months in the recent past.

Here are the ranked percentage increases in union election filings for these states for Q1 of the NLRB fiscal years 2022 and 2023:

Massachusetts: 500%
Tennessee: 150%
Texas: 143%
Georgia: 133%
California: 57%
New York: 29%
DC: 15%

And here are the percentage increases between the first quarters of the NLRB fiscal years 2023 and 2020 (the last fully pre-COVID quarter):

Tennessee: 400%
Texas: 89%
DC: 67%
California: 42%
Georgia: 40%
Massachusetts: 33%
New York: -19%

Large Labor-Friendly States: A Closer Look

New York

Yes, to be clear, total union representation petitions filed in New York remain below pre-COVID levels. But they are up over last year. Frankly, New York probably wouldn’t be worth mentioning here, except that it normally accounts for a significant portion of the union elections filed with the NLRB. So a modest increase from Q1 FY 2022 to Q1 FY 2023 has a material impact on the total nationwide increase. As previously discussed, it is plausible that union organizing in New York is still recovering from COVID-19 at a slower rate than the rest of the country.

In fact, we can dig deeper and learn that non-Starbucks petitions are essentially flat throughout most of New York State. All of the year-over-year increase comes from Region 29 of the NLRB. Region 29 is based in Brooklyn and covers Brooklyn, Queens, Staten Island, and Long Island. NLRB Q1 union representation petitions not involving Starbucks increased from 7 in FY 2022 to 19 in FY 2023. But that number still falls well below the 33 such filings in Oct. through Dec. 2019 (Q1 FY 2020). Meanwhile, Manhattan and Upstate New York filings have remained surprisingly consistent, with hardly any deviation among the first quarters of fiscal years 2020, 2022, and 2023.

California

Similarly, California’s increase is localized to two of the four NLRB regions covering the state: Region 20, based in San Francisco, serving the northernmost part of the state, and Region 21, based in Los Angeles and San Diego, serving the southernmost part.

California union representation petitions increased from 10 in Q1 FY 2022 to 21 in Q1 FY 2023 in Region 20 and from 12 to 21 in Region 21. The Q1 FY 2020 filings were 9 for Region 20 and 14 for Region 21, showing more than just a return to pre-COVID levels. While the central California Regions (31 and 32) increased slightly between Q1 FY 2022 and 2023, both Regions are still roughly even with Q1 FY 2020 petitions.

Decertification Petitions

The corollary to an NLRB petition seeking union representation (known as an “RC” petition) is a decertification (“RD”) petition seeking the removal of a previously recognized union representative. An earlier analysis of RD petitions for the first half of FY 2022 supported the conclusion that last year’s increase in RC filings (not involving Starbucks) may have been a COVID-related phenomenon. A 42% year-over-year increase in RD petitions over that period was actually higher than the Starbucks-excluded increase among RC petitions (36%).

Decertification petition filings remained at or above pre-COVID levels throughout FY 2022. However, it appears that trend may be dissipating. Seventy RD petitions were filed with the NLRB between October and December 2022–virtually the same as the 71 filed in the same period in 2021. While still higher than the 56 filed in October-December 2019, the RD petitions filed in Q1 FY 2023 remain below the levels for the same period of 2017 (82) and 2018 (76).

Representation Election Results

Unions typically win about 70% of the representation elections held. Many petitions filed in Q1 FY 2023 have not yet resulted in elections. Among those that have, unions have won about 75% of the time. But with so many cases yet to be decided, we don’t know whether unions are really becoming more likely to win representation status.

What Does the Recent Increase in Union Elections Means for Employers in 2023?

It’s really still too early to tell. But the latest statistics start to suggest a measurable shift toward greater unionization at private sector companies in the United States. Certain Southern states might be experiencing a particular renewed interest in union activity. Georgia, Tennessee, and Texas might constitute a current “watch list.” Areas with an existing higher propensity toward unionization, like parts of California, New York, and Massachusetts, may also be undergoing renewed employee interest in organizing.

Employers should continue to monitor these data, especially if they have any reason to suspect union organizing in their workplace.

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November 23, 2022

Will the NLRB Rein in Electronic Monitoring and Algorithmic Management of Employees?

National Labor Relations Board General Counsel Jennifer A. Abruzzo has an announced her intention to seek new restrictions on electronic monitoring and algorithmic management of employees both remotely and in the workplace. In an October 31, 2022 General Counsel Memorandum, Abruzzo directed NLRB staff to apply the National Labor Relations Act to protect employees to the greatest extent possible in these areas. The scope of any new limitations on employers will depend on how the Labor Board decides future cases that the General Counsel’s Office chooses to prosecute.

Section 7 Rights

Section 7 of the National Labor Relations Act grants employees “the right to self-organization, to form, join, or assist labor organizations, to bargain collectively through representatives of their own choosing, and to engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection,” as well as the right “to refrain from any or all such activities.”

It is unlawful for an employer to interfere with, restrain, or coerce employees in the exercise of these rights.

Though Section 7 doesn’t directly address electronic surveillance or the use of artificial intelligence or algorithms in managing employees, Abruzzo emphasizes that “It is the Board’s responsibility ‘to adapt the Act to changing patterns of industrial life.'”

According to the GC Memorandum, it is already legally established that employers violate the NLRA if they:

Institute new monitoring technologies in response to activity protected by Section 7;
Utilize technologies already in place for the purpose of discovering that activity; or
Create the impression of monitoring its employees for that purpose.

A New Framework

The General Counsel now implores the Board to adopt a new framework for protecting employees from “intrusive or abusive forms of electronic monitoring.” Without detailing what particular practices might be unlawful, the Memorandum references current practices such as:

recording workers’ conversations and tracking their movements using wearable devices, security cameras, and radio-frequency identification badges;
“keep[ing] tabs” on drivers using GPS tracking devices and cameras; and
monitoring employees who are working on computers using keyloggers and software that takes screenshots, webcam photos, or audio recordings throughout the day.

This new framework would find that an employer presumptively commits an unfair labor practice where its electronic surveillance and management practices, viewed as a whole, would tend to interfere with or prevent a reasonable employee from engaging in activity protected by the Act. GC Abruzzo further urges the balancing of the effect of employer rules on “a reasonable employee who is in a position of economic vulnerability, taking into account the totality of the circumstances.”

Productivity vs. Employee Rights

The General Counsel’s Memorandum even casts doubt on employers’ use of software to encourage employees to work faster. She laments, “In the workplace, electronic surveillance and the breakneck pace of work set by automated systems may severely limit or completely prevent employees from engaging in protected conversations about unionization or terms and conditions of employment that are a necessary precursor to group action.”

In other words, it appears the General Counsel would go so far as to suggest that employees have a Section 7 right to have time to discuss unionization or their terms of employment while working. This view would likely shock many employers who have justifiably assumed they could expect employees commit themselves entirely to the job at hand during work time.

What This Means for Employers

Although the General Counsel can’t change the law herself, she has a significant role in determining what cases will be brought before the National Labor Relations Board, whose members can and do establish the law under the National Labor Relations Act. Moreover, employers may be found to violate the law based on practices that have never been challenged in the past, or even those that have previously been deemed lawful by the NLRB. Thus, the pronouncement of this new enforcement initiative should concern employers who engage in any form of electronic monitoring or algorithmic management of their employees.

Other than mentioning various technological capabilities, the General Counsel hasn’t expressly advised employers what practices she may challenge. All that is clear is that she seeks strong protections for employee privacy at the potential expense of employer productivity and profitability.

Employers that utilize computer algorithms, artificial intelligence, or electronic monitoring tools should review their use in light of this NLRB General Counsel Memorandum. Relevant considerations probably include whether the software or monitoring continues outside the office or working hours, whether any data are available to third parties, and the purposes the use of technology serves. But until the NLRB weighs in on more specific cases, it will be hard to predict the extent of the potential limitations and which factors will be most important in the Board’s analysis.

For more labor law insights and NLRB developments, follow Horton Law on LinkedIn and subscribe to our email newsletter.

October 10, 2022

NLRB Changes Course on Dues Checkoff

For many decades, the National Labor Relations Board permitted employers to discontinue dues checkoff arrangements following the expiration of a collective bargaining agreement. More recently, employers’ right to do so has fluctuated depending on which political party has held the majority of seats on the NLRB. On September 30, 2022, the current Democratic majority ruled that employers must continue a contractual dues checkoff despite the expiration of the subject union contract.

Dues Checkoff Provisions

A dues checkoff agreement requires that the employer deduct union dues from employees’ wages and remit them to the union as authorized by the employee. Historically, upon expiration of a collective bargaining agreement (CBA) containing a dues checkoff provision, the employer could lawfully stop collecting dues for the union without having to bargain over the changed practice. In other words, the dues checkoff did not outlive the contract.

Bethlehem Steel Precedent

In 1962, the U.S. Supreme Court held that an employer must maintain employees’ terms and conditions of employment following the expiration of a CBA until the parties either agree to new terms or reach an impasse in their negotiations of a successor agreement. However, the NLRB has always recognized exceptions to this doctrine.

The Board first expressed such an exception for dues checkoff agreements in a 1962 Bethlehem Steel case. There, the NLRB reasoned: “The Union’s right to such checkoffs in its favor . . . was created by the contracts and became a contractual right which continued to exist so long as the contracts remained in force.”

The Bethlehem Steel holding survived at the Board, and in the federal courts, until 2015. Then, with a Democratic majority, the NLRB first held that employers must continue to deduct dues even after the contract expires. By 2019, Republicans gained the Board majority and reinstated the Bethlehem Steel precedent.

Valley Hospital Medical Center Reversal

The 2019 reinstatement of Bethlehem Steel occurred through a case involving Valley Hospital Medical Center. Following that decision, the union requested review by the U.S. Court of Appeals for the Ninth Circuit. The Ninth Circuit remanded the case to the NLRB to “supplement[] its reasoning” for reversing the 2019 decision.

Instead of supplementing the 2019 reasoning, the Board, again with a Democratic majority, rejected the application of Bethlehem Steel. According to the majority opinion, “treating contractual dues-deduction provisions comparably with nearly all contractual provisions, which establish terms and conditions of employment that cannot be changed unilaterally after contract expiration, implements the [National Labor Relations] Act’s policy goals of both encouraging the practice and procedure of collective bargaining and of safeguarding employees’ free choice in the exercise of their Section 7 rights.”

Thus, under the latest Valley Hospital Medical Center ruling, employers must continue deducting union dues despite CBA expiration.

What does this mean for employers?

The NLRB ordered Valley Hospital Medical Center to make the union whole for dues it would have received from employees. This remedy includes paying the unpaid dues with interest to the union. The Board applied this changed interpretation retroactively to all pending cases where dues checkoff is at issue. Accordingly, all employers that have unilaterally stopped withholding and remitting union dues after a CBA expired are no longer in compliance with the law and could be required to pay the dues with interest.

This latest ruling will likely return to the courts for further proceedings. However, there is no certainty of a return to the long-standing Bethlehem Steel exception. Thus, most employers will likely choose to continue dues checkoff following contract expiration as long as the current Valley Hospital Medical Center decision remains the Board’s majority view.

For more labor law insights and NLRB developments, follow Horton Law on LinkedIn and subscribe to our email newsletter.