Legislation Allowing Unionized Companies to Give Merit Raises Introduced in Congress

Senator Marco Rubio (R-Fla) and Representative Todd Rokita (R-Ind.) introduced legislation in February that would let employers give merit pay increases or bonuses to workers covered by collective bargaining agreements. The Rewarding Achievement and Incentivizing Successful Employees (RAISE) Act would amend the National Labor Relations Act to provide that employers are not barred under collective bargaining agreements from “paying an employee in a bargaining unit greater wages, pay, or other compensation for, or by reason of, his or her services as an employee of such employer, than provided for in such contract or agreement.”

According to Sen. Rubio, “When America’s workers earn a raise because of their hard work, union bosses should not be able to block it as labor policy currently allows. The RAISE Act would bring greater fairness and opportunity to the modern workplace by giving American workers the freedom to earn more money for a job well done.”

Matt Austin is a lawyer based in the Columbus, Ohio office of Roetzel & Andress, LPA who limits his practice to representing employers dealing with labor, employment, and OSHA matters. You can call Matt at (614) 723-2010 or email him at maustin@ralaw.com.

Despite the Widespread Steelworker Strike at Oil Refiners Across the US, Union Strikes are a Dying Pressure Tactic

In the 1950’s there were an average of 352 large-scale work stoppages each year. A large-scale work stoppage is defined as at least 1000 workers walking off the job. 1952 saw the most large-scale strikes – 470 – when 2.7 million workers took part in workplace stoppages. Since then, the number of strikes has fallen each decade. In 1962 and the 1970’s, the rate slowed to an average of 282. In 1981, President Ronald Reagan fired over 11,000 air traffic controllers for violating a prohibition on strikes by federal employees; since then there have never been more than 100 large work stoppages a year, and the number continues to ratchet down. Since 1989, there have been fewer than 50 work stoppages a year; since 2000, fewer than 30; and since 2007 fewer than 20. Last year, in 2014, there were just 9. What was once considered the ultimate ace in the hole is no longer an effective labor relations strategy.

Matt Austin is a lawyer based in the Columbus, Ohio office of Roetzel & Andress, LPA who limits his practice to representing employers dealing with labor, employment, and OSHA matters. You can call Matt at (614) 723-2010 or email him at maustin@ralaw.com.

How do You Lose a Union Election after Winning It?

Employees at an industrial aluminum facility in New York started a union organizing drive. The Company countered with an anti-union campaign. The union lost the election by roughly 271 votes for representation to 285 votes to stay union-free. During the campaign period, the union filed numerous unfair labor practice charges alleging that the Company restored benefits to employees to dissuade them from unionizing, threatened employees with job loss and loss of benefits, disparaged the union, and demoted a lead union organizer. The NLRB issued a complaint on the unfair labor practice charges and sought a bargaining order because more than 50% of the bargaining unit signed authorization cards.

After a 17-day hearing, the NLRB Administrative Law Judge ruled that a bargaining order was appropriate because of the “Company commission of several hallmark violations along with numerous other violations, many of which directly affected the entire bargaining unit, and any of which directly involved upper-level management, strongly suggests that the lingering effect of these violations is unlikely to be eradicated by traditional remedies.” The election (that the Company won) was set aside, and the Company was ordered to start negotiating a collective bargaining agreement with the union.

Matt Austin is a lawyer based in the Columbus, Ohio office of Roetzel & Andress, LPA who limits his practice to representing employers dealing with labor, employment, and OSHA matters. You can call Matt at (614) 723-2010 or email him at maustin@ralaw.com.

National Labor Relations Board and Deferral: The Law has Changed, Have You Kept Up?

Deferral is a term that hardcore labor lawyers, like yours truly, know, but unless you are a seasoned labor practitioner, you probably don’t know what it means. In the NLRB’s 1955 Spielberg ruling, the Board decided that it would defer to arbitrators’ decisions when the proceedings appeared to have been fair and regular, the parties had agreed to be bound, and the decision wasn’t “clearly repugnant to the purposes and policies” of the National Labor Relations Act.

At the end of 2014, the Board changed the terms of when deferral is appropriate. Now, the NLRB will only defer on an issue under Section 8(a)(1) or (3) of the National Labor Relations Act if the party advocating for deferral (usually the employer) can prove that the arbitrator was: (a) explicitly authorized to decide the unfair labor practice issue; (b) the arbitrator was presented with and considered the statutory issue; and (c) NLRB law would reasonably permit the award.

This new approach requires employers with unionized workforces to reconsider their labor arbitration strategies and specific contract language addressing whether to specifically give arbitrators the power to decide Unfair Labor Practices.

Matt Austin is a lawyer based in the Columbus, Ohio office of Roetzel & Andress, LPA who limits his practice to representing employers dealing with labor, employment, and OSHA matters. You can call Matt at (614) 723-2010 or email him at maustin@ralaw.com.

Long-Retired Employees See Fully Vested Pensions Drastically Cut by Multiemployer Pension Reform Act

The Multiemployer Pension Reform Act of 2014 (MPRA) was signed by President Obama on December 15th as part of a last-minute deal approved by lawmakers as they were leaving town for Christmas break. The MPRA allows funds to cut benefits for workers and current retirees if the plan is 20% or more underfunded. In other words, Congress and the President have allowed workers who are fully vested in their retirement funds to take a financial hit for union managers who failed to keep pensions fully funded. At least those over 75 years old are exempt.

The new law, a bi-partisan effort from pro-union Rep. George Miller (D-Ca) and anti-union Rep. John Kline (R-Mn) enables multiemployer plans to make deeper cuts to pensions than the 2006 Pension Protection Act allowed. More dramatic cuts to the accrued benefits for current workers and cuts to the benefits already being paid to retirees are permitted. Affected retirees could have their pensions cut by as much as 60%.

According to some, Randy G. DeFrehn, executive director of the National Coordinating Committee for Multiemployer Plans said, “After 2000, the markets didn’t start to perform very well. When the dot-com bubble burst, we started working with Congress on the 2006 PPA, which introduced some tighter constraints on plans and protected employers against unexpected contribution increases and excise taxes. That was helpful but we thought it was not going to work out in the long run. We were looking back in history and there was not three consecutive years in the markets like there were from 2000 to 2002 since the 1940’s. We believed the economists that this would be a once-in-a-lifetime experience, but then six years later we’re back in the soup in 2008 with the Great Recession.”

The MPRA was enacted after the Pension Benefit Guaranty Corp., which protects pensioners when their plans fail, reported that its funding deficit soared $8.3 billion last year to a staggering 42.4 billion. The government is allowed to enter pension plans into “critical and declining status” if they are projected to become insolvent in the next 15 years, or in the next 20 years if the plan is less than 80% funded, or if the inactive to active participants exceed a 2-to-1 ratio. Entering such status enables the government to dramatically reduce paid benefits to plan participants even before the plans fail. And that’s exactly what a lot of long-term retirees are quickly learning.

Matt Austin is a lawyer based in the Columbus, Ohio office of Roetzel & Andress, LPA who limits his practice to representing employers dealing with labor, employment, and OSHA matters. You can call Matt at (614) 723-2010 or email him at maustin@ralaw.com.

Volkswagen Agrees to Meet with Any Organization Representing 15% of a Group of Workers

Remember last year when the United Autoworkers Union tried to organize the Volkswagen plant in Chattanooga, Tennessee? Remember how the UAW failed to win the secret ballot election to represent the VW workers, despite the company welcoming the union at the plant? Well, the UAW was down, but not out. VW and the UAW are now meeting bi-weekly to discuss work issues. And, the UAW may just be the first of several labor organizations certified to meet with management to discuss terms and conditions of employment despite not having won a union election. How is this so?

VW will meet with any organization that is independently certified to represent at least 15% of a group of the Chattanooga workers. So, if a group of workers is made up of 10 employees performing the same job, and 2 of them get an organization to represent them, then VW has to meet with the group. For a workplace with thousands of employees and hundreds of groups of workers, this policy has inefficiency written all over it.

How often a group meets with management, (and what level of management is involved) is determined by how many people in the group are represented. A group representing between 15% and 30% can meet with the human resources department once per month. Groups representing between 30% and 45% of the workers can meet with HR monthly and a member of the VW executive committee quarterly. Groups representing over 45% of the workers will meet with HR twice a month and a member of the executive committee once a month.

Matt Austin is a lawyer based in the Columbus, Ohio office of Roetzel & Andress, LPA who limits his practice to representing employers dealing with labor, employment, and OSHA matters. You can call Matt at (614) 723-2010 or email him at maustin@ralaw.com.

Resident Physicians at a University Hospital Join a Union to Save the Company Money

Resident physicians and fellows at Howard University Hospital in Washington D.C. recently joined the Service Employees International Union. According to union leadership, residents had a range of concerns including parking, meals, salary, and the financial sustainability of the hospital. The financial stability of the hospital element is most noteworthy.

In late 2014, the Washington D.C. hospital hired southern Californian Paladin Healthcare Capital to “reengineer” its operations at the financially strapped institution. On its website, Paladin Healthcare described itself as “a special opportunity investor that makes private equity, structured debt, and real estate investments in the healthcare sector.” It continued, “We provide capital to over-levered and/or underperforming hospitals that can be transitioned to stable and profitable enterprises, with a particular focus on urban community hospitals.”

One of the hallmarks of employees seeking union representation is for job security. Howard resident physicians felt insecure with Paladin Healthcare reengineering the hospital. In a letter from D.C. Councilwoman Anita Bonds (D) to Howard University, she said, “I believe that a unified voice for resident physicians could well benefit the hospital . . . and meet the financial challenges it faces.” Um, saving an employer money is not high on a union’s objective list, especially when the union says that meals and salary are some of the members’ concerns.

Matt Austin is a lawyer based in the Columbus, Ohio office of Roetzel & Andress, LPA who limits his practice to representing employers dealing with labor, employment, and OSHA matters. You can call Matt at (614) 723-2010 or email him at maustin@ralaw.com.