News

August 18, 2015
18 Aug 2015

August Legal Update

By L. Michael Zinser, MACMA General Counsel

“QUICKIE ELECTION” RULE UPHELD IN WASHINGTON, D.C.

On July 29, 2015, U.S. District Court Judge Amy Berman Jackson – an Obama appointee – upheld the Final Rule of the National Labor Relations Board, providing for “quickie elections” under the National Labor Relations Act.


In order for the U.S. Chamber of Commerce to prevail, the Judge said it must show there is no set of circumstances under which the Final Rule could be applied consistently with the NLRA or the Constitution. Judge Jackson believes there are circumstances under which it could be applied consistently, so the challenge had to fail.

The Court was very disdainful of the First Amendment rights of Employers that are protected by the NLRA itself and have been so noted by the U.S. Supreme Court. The Court stated:

The plaintiffs have failed to show that the Final Rule inhibits this debate in any meaningful way, they certainly have not shown that there is no set of circumstances in which this aspect of the Final Rule can be enforced consistently with the NLRA or the First Amendment. That is because the Regional Director retains discretion in determining when the election will be held, and in doing so, he is directed to consider among other factors, the desires of the parties, which may include the opportunity for meaningful speech about the election… this discretion makes it virtually impossible for plaintiffs to demonstrate that the elimination of the pre-election waiting period violates the NLRA or the First Amendment, or otherwise exceeds the Board’s authority under its authorizing statute.

The Court was also dismissive of the legislative history of the NLRA, which makes clear that Congress believed that at least 30 days between an election and the petition are necessary to adequately assure employees are statutorily guaranteed the fullest freedom in choosing whether to be represented by a union.

The Court was equally dismissive of employee privacy concerns. The new Rule requires Employers to produce a voter list containing the full names, work locations, shifts, job classifications, and contact information (including home addresses, available personal e-mail addresses, and other available home and personal cellular telephone numbers) of all eligible voters, within two business days of the direction of election.

While it was noted that employees have a legitimate, nontrivial privacy interest in non-disclosure, and that some employees would consider the disclosure of the additional contact information to be an invasion of privacy, the Court believes that disclosure of this information to unions is more important than this privacy interest. The Court also rejected arguments that employees should have an opt-out provision. The Court simply noted that, if an employee receives unwanted calls, letters or e-mails, he or she could just ignore them.

Editor’s Note: Let us hope that the U.S. Chamber of Commerce appeals the Decision of Judge Jackson.

U.S. DEPARTMENT OF LABOR ISSUES GUIDANCE MEMO ON INDEPENDENT CONTRACTORS

On Wednesday, July 15, 2015, the U.S. Department of Labor issued an interpretative Guidance Memo on the misclassification of employees as independent contractors. The Guidance Memo is part of the administration’s overall war against independent contractors – and it could be a real game changer.
One has to always keep in mind that organized labor hates independent contractors. The current administration is very pro-union. This Guidance Memo is doing the bidding of labor unions everywhere.

The message in the Guidance Memo is consistent with the new position on independent contractors adopted by the National Labor Relations Board in a recent case involving Federal Express drivers in Connecticut. The NLRB’s Decision attempts, by stealth, to impose a single factor test: “Does the Publishing Company have greater bargaining power than an individual contractor?” That is really stretching the law.

This Guidance Memo tries to stretch the definition of “employee.” It also focuses on economic dependence of the individual contractor. Disturbingly, it places very little value on the intention of the parties. It is clear to this writer that the DOL is going to take the position that most individuals are employees – not independent contractors.

However, the DOL Guidance Memo is inconsistent with much of current caselaw supporting independent contractor status.

Fortunately, for the newspaper industry, there is an exemption under Section 13(d) of the Fair Labor Standards Act. If an individual is engaged in the delivery of newspapers to the consumer, he/she is exempt from the minimum wage, overtime, and child labor provisions of the Act. Unfortunately, that exemption does not help with other types of contractors.
Editor’s Note: Buckle your seatbelt and get ready for a rocky ride with the DOL’s new interpretation on independent contractors for purposes of the FLSA.

PURPLE COMMUNICATIONS UPDATE

In Purple Communications, the National Labor Relations Board ruled that unions could have access to Employer e-mail systems when conducting organizing drives. As noted in a previous column, this overruled the 2007 Register-Guard decision that denied unions access to Employer communication systems.

The attorneys for Purple Communications have finished briefing the exceptions to the ALJ’s decision, and the case is now back before the Board. Assuming the Board takes further adverse action against Purple Communications, the attorneys plan to appeal into the court system.

Editor’s Note: The Zinser Law Firm, P.C. represented The Register-Guard in the original 2007 e-mail case overturned by Purple Communications.

KANSAS FEDEX DRIVERS ARE EMPLOYEES

FedEx drivers made a claim against the Company under the Kansas Wage Payment Act (“KWPA”). The trial court granted Summary Judgment in favor of FedEx, finding that the drivers were independent contractors as a matter of law, rather than employees. The drivers appealed to the U.S. Court of Appeals for the 7th Circuit.

The 7th Circuit certified two questions to the Kansas Supreme Court:

  • Are the plaintiff drivers employees of FedEx as a matter of law under the KWPA?
  • For drivers that can acquire more than one service area from FedEx, is the answer to the preceding question different for plaintiff drivers who have more than one service area?

The Kansas Supreme Court responded that the drivers are employees as a matter of law, and that the issue is not different for drivers that have multiple routes. The 7th Circuit then reversed the trial court’s grant of Summary Judgment in favor of the Company and remanded the case with instructions for the lower court to find that the drivers were employees.

The 7th Circuit noted that the 20-factor test for determining employment status under the KWPA was the only test required, and finding actual control was not necessary.

The test under the KWPA is not the same test used for Unemployment Insurance or Workers’ Compensation. The Unemployment Insurance test looks at the right to control and the service being outside the usual course of business for the Company, while the Workers’ Compensation test looks generally at the right to control.