NLRB Enforces Subpoena about Alleged Joint Employer Relationship with Nothing More than Mere Allegation of Joint Employer Status.

The National Labor Relations Board has denied petitions to revoke subpoenas that were issued by an NLRB Regional Director to two companies seeking information about a possible joint employer relationship between the two employers. You read that right. The two pro-labor NLRB Board Members enforced the subpoenas despite the union’s failure to articulate any facts about the joint employer allegation.

This is remarkable. The charge referred to the employers as alter egos, single employer, and joint employers, but the unfair labor practice charge did not have any additional information. Per the NLRB, the subpoenas “lie well within the scope of the Board’s broad investigative authority, which extends not only to the substantive allegations of the charge, but to ‘any matter under investigation or in question’ in the proceeding.” The NLRB continued, “nothing in Section 11 of the Act or Sec. 102.31(b) of the Board’s Rules can be read to impose a requirement that the Regional Director articulate ‘an objective factual basis’ in order to compel the production of information that is necessary to investigate a pending unfair labor practice charge.”

Once again, employers are on the losing end of the current NLRB pro-union majority Thankfully acting-chair Miscimarra sticks up for employer’s rights (albeit in dissenting opinions only). Member Miscimarra wrote that a subpoena seeking documents pertaining to an alleged joint-employer or single-employer status of a charged party “requires more…than merely stating the name of possible single or joint employers on the face of the charge.” Specifically, the General Counsel must be able to articulate “an objective factual basis supporting such an inquiry.” Member Miscimarra found the General Counsel failed to do so here.

Matt Austin owns Austin Legal, LLC, a boutique law firm based in Ohio that limits its representation to employers dealing with labor, employment, and OSHA matters. You can call Matt at (614) 285-5342 or email him at Matt@MattAustinLaborLaw.com.

Alter Ego Grocers Ordered to Recognize and Bargain with Union

Victor and Josephine Laracca owned and operated a Foodtown supermarket for ten years. Foodtown employees were represented by the UFCW. Shortly after Foodtown closed, Laracca’s son Roberto opened a supermarket named Fantastic a few miles from the shuttered Foodtown.

While Roberto is sole owner of Fantastic, a $400,000 loan was guaranteed by Victor and Josephine and secured by mortgages on properties they owned. Fantastic was also initially stocked with groceries that were purchased using funds from a loan personally guaranteed by Victor and Josephine and secured by a mortgage on property Josephine owned with Roberto’s sister. The UFCW, which had represented Foodtown employees before it closed, argued that Fantastic was an alter ego of Foodtown and thus UFCW was entitled to represent Fantastic employees, too. Fantastic was also largely staffed by Foodtown managers and non-supervisory personnel.

The NLRB finds alter ego status where multiple entities have substantially identical management, business purpose, operations, equipment, customers, supervision, and ownership. More importantly, though, through a legal procedure called a 10(j) injunction, the Board successfully persuaded a federal court to order Fantastic to recognize UFCW as the union representing its employees and bargain with the UFCW for a union contract while the issue of alter ego status was being investigated. Consider the waste of time, energy, and money Fantastic must expend on what could be an exercise in futility. If Fantastic is not an alter ego to Foodtown, then the UFCW does not represent Fantastic employees, so why make Fantastic pretend its employees are unionized? Wouldn’t it be better to wait for the results of the investigation?

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.