Solicitor General to NLRB in Murphy Oil case: You're On Your Own, and We Will Ask SCOTUS to Rule Against Board

In an extremely unusual turn of events, the U.S. Solicitor General has reversed course and informed the Supreme Court that it now opposes the position of the NLRB in Murphy Oil, an important case regarding the validity of employment arbitration agreements.

In September 2016 -- before the November presidential election -- the Solicitor General filed a petition for review on behalf of the NLRB, advocating the NLRB's aggressive position that many employment arbitration agreements violate the NLRA.

However, as detailed in a SCOTUSBLOG post, in mid-June the Solicitor General filed a brief with the Supreme Court opposing the NLRB's position.  The Solicitor General then informed the NLRB it was "free" to represent itself before the Court -- because the Solicitor General would not.

The NLRB then issued an opaque statement , noting that the Solicitor General had "authorized" the NLRB to represent itself before the Court.

With the confirmation of Justice Gorsuch, it appears more likely than not that the NLRB's position will be rejected, when the case is decided next term.

What Took So Long? NLRB Rules Teaching Assistants Covered By NLRA, May Organize

In a decision anticipated by both labor and management since the start of the Obama administration in 2009, the NLRB announced today that private university teaching assistants are "employees" as defined in the National Labor Relations Act, and therefore may organize.  The Board's 3-1 ruling reverses a 2004 NLRB decision in Brown Univ. which held that teaching assistants were not "employees" under the NLRB, which itself reversed a decision in New York Univ. holding that teaching assistants were employees under the NLRA.

This line of cases is a prime example of the lack of stability in Board precedent on key issues, with the law changing back and forth based on which party controls the White House, which benefits neither labor nor management.

Expect another court challenge, but that will likely fail.


--Jonathan Nadler

--Jon Nadler, Eckert Seamans, Philadelphia

Whistleblower Alert: SEC Slaps Employer with $265k Penalty for Common Severance Agmt Language

The SEC recently announced it imposed a six-figure penalty on an employer for including what is (or what used to be) garden-variety language in a severance agreement, for violating the whistleblower provisions of Dodd-Frank.

In an apparent effort to comply with prior guidance issued by the EEOC and NLRB, the provision at issue expressly permitted the departing employee to file charges or otherwise cooperate with administrative agencies -- notwithstanding a general release of all claims.

However, the language that triggered SEC scrutiny was a proviso that the departing employee disclaimed any right to monetary recovery resulting from complaints to/cooperation with a governmental agency.  That provision has been routinely used by employers in severance agreements, with the apparent approval of the EEOC and NLRB.

The SEC, however, disagrees.  According to SEC, the right to monetary recovery from whistleblower activities within the scope of Dodd-Frank cannot be waived.

The practical impact is that for employers covered by Dodd-Frank, the impossibility of securing a release of whistleblower claims will reduce the incentive to offer severance, and will result in increased litigation.

Expect a court challenge to the SEC's interpretation.

--Jonathan Nadler

--Jon Nadler, Eckert Seamans, Philadelphia

NLRB Expands Protections for Employees to Engage in Abusive, Profane Facebook Outbursts

Can an employee post a vicious and profane rant against his manager and his manager's family on Facebook -- during a union organizing campaign -- and be protected from discipline?  Yes, according to the NLRB in a decision issued on March 31, 2015, ordering the employer to reinstate the employee with back pay.

The employee's Facebook post stated in part:

"[My manager] is such a NASTY M***** F***er" ... F*** his mother and his entire f***ing family!!!!  What a loser!!!! Vote YES for the UNION!!!!!!!!"

Although the NLRB majority asserted that its conclusion that the posting was protected activity under federal labor law was in accordance with existing precedent, NLRB Member Johnson issued a dissent strongly disagreeing on that point.  As Member Johnson explained, although on some occasions intemperate conduct or use of profanity may be protected, in this case, the "offensive online rant, which was fraught with insulting and obscene vulgarities directed toward his manager and his manager's mother and family," was far outside the boundaries of protected speech and prior precedent, and was simply a "vicious attack" on the manager's family that should enjoy the status of protected, concerted activity.

For employers, the lesson is that, especially during a union organizing campaign, proceed with caution in issuing discipline, particularly where the context suggests the incident is intertwined with union organizational activity.

--Jonathan Nadler

--Jon Nadler, Eckert Seamans, Philadelphia

NLRB Implements Limits on Deferral to Arbitration

Following its December 2014 decision in Babcock & Wilcox, upending decades of precedent and limiting the circumstances in which the NLRB will defer to arbitration proceedings between and employer and a union, the NLRB General Counsel has issued guidance as to how this change will be implemented.

Among other changes, the NLRB now requires the party arguing that deferral should apply now has the burden of proof on this issue.  In addition, the Board will require an employer to litigate an issue twice -- once in arbitration, and again before the NLRB -- unless the party urging deferral can prove not just that the arbitrator considered the same set of facts and issues that the NLRB would consider, but that the arbitrator actually considered and ruled upon the "statutory" issue under the NLRA.  Moreover, the NLRB now will review whether it agrees with the legal conclusions of the arbitrator, by considering whether Board law "reasonably permits" the arbitrator's decision.

As a result, both unions and employers will be deprived one of the primary benefits of arbitration -- fast and efficient resolution of disputes -- and instead will be required to devote additional resources to litigating disputes on two fronts, over a longer period of time.

--Jonathan Nadler

--Jon Nadler, Philadelphia

ADA Duty to Accommodate Applies to Drug Testing

The EEOC recently announced a six-figure settlement and consent decree with Kmart in a case that underscores the importance of considering the duty to provide reasonable accommodations in every aspect of employee relations.  According to the EEOC's press release, the case involved a job applicant's claim that a medical condition prevented him from providing a urine sample for a mandatory pre-employment drug screen, and that he was not offered the opportunity to submit to alternative methods of testing.  EEOC also obtained significant injunctive relief though the settlement, designed to ensure that reasonable accommodations (such as the option to submit to blood, hair, or saliva testing) are made available where medically necessary.

--Jonathan Nadler

--Jon Nadler

Court Rules Employer Allowed to Require Employee SSN, Despite Religious Objection

Can an employer demand that employees provide their Social Security number as a condition of employment, even where an employee lodges an objection on the basis of their religion?

Yes, according to a recent decision, Yeager v. FirstEnergy Generation Corp., issued by the U.S. Court of Appeals for the Sixth Circuit.

The employee in this case claimed he was wrongfully terminated (or not hired) after he refused to provide his SSN, claiming that he had "disclaimed and disavowed" his SSN on the basis of a sincere religious belief.  He then sued for discrimination on the basis of his religion under Title VII and Ohio law.

The trial court dismissed the claims, and the 6th Circuit affirmed.  The basis of the court's decision was that while Title VII and Ohio law require an employer to make reasonable accommodation of an employee's sincerely held religious beliefs, the proposed accommodation here -- allowing an employee to refuse to provide a SSN -- was not reasonable, because federal law requires every employer to collect employee Social Security numbers for tax reporting purposes.

--Jonathan Nadler

--Jon Nadler