Union On Hook for Non-Member Worker’s Back Pay After Refusing to Represent Him

A discharged Cummins, Inc. plant worker who wasn’t a union member may be entitled to have the Machinists union pay his lost wages after the union refused to arbitrate his complaint contesting the firing.

Machinists Talbot Lodge No. 61 represents all of the production and maintenance employees at a Tennessee Cummins plant, but a union told a worker that it would not challenge his firing because he wasn’t a union member. The union presented testimony that its decision was because the claim lacked merit. The ALJ didn’t buy it. Amchan ordered the union to request reinstatement with back pay or arbitrate the firing.

Unions have a duty of fair representation to all employees in a bargaining unit regardless whether employees in right-to-work states, like Tennessee pay union dues.

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 reach Matt by calling him at (614) 843-3041 or emailing him at Matt@MattAustinLaborLaw.com.

Contractor that Thought it was Out of a Multi-Employer Bargaining Unit made Unlawful Workplace Changes

A marble contactor dropped out of a multi-employer bargaining unit and informed the union it would be terminating an existing CBA when it expired. The company also informed the workers it would implement new employment policies like modifications to wages and health insurance, stopping contributions to the union’s pension plan, as well as implementing flexible spending accounts, profit sharing, and a 401k plan.

In response, the workers held a union representation election and voted the union in. The company refused to bargain with the union, and the NLRB ruled that the Company’s refusal was a violation of the National Labor Relations Act. Undeterred, the Company followed through with the previously announced changes believing that it no longer had a duty to bargain under the previous CBA. But, the NLRB held that the Company was still obligated to bargain with the union and violated the Act by making unilateral changes after the CBA expired. The Board then ordered the Company to rescind the changes and rehire the laid off employees. 

In Member Miscimarra’s dissent, he said that the Company’s move to implement changes that had been announced before the union election was held was legal. “Board case law is crystal clear that this action was lawful. An employer does not violate the NLRA when, after a union is elected, its implements a term or condition of employment decided on before the election,” he said. Miscimarra also noted that under the majority’s decision, a company in Ardit’s situation would be caught between a rock and a hard place since none of the employer’s options would have been legal under the majority’s framework.

The respondent had three options: (1) it could implement the terms it had previously announced; (ii) it could refrain from implementing those terms or (iii) it could give the union notice and opportunity to bargain. Under any fair system of law, one of these options must be lawful. Under the majority’s decision here, all three options are unlawful.

Miscimarra also concluded that Ardit’s layoffs were similarly lawful because the company had no work for the workers to perform.

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.

NLRB Changes Backpay Formula for Terminated Employees: Harmful to Employers

The NLRB voted 3-1 to revise its backpay formula for compensating workers found to have been unlawfully terminated, ordering an employer to pay for a former employee’s interim-employment and search-for-work expenses.

The Board had previously treated those types of expenses as offsets that reduced the amount of interim earnings that were then subtracted from gross back pay. This ruling, though, establishes that employees will now be compensated for such expenses, even when interim earnings are nonexistent or less than those expenses.

“The Board has been awarding search-for-work and interim employment expenses for 80 years,” the majority wrote. “The changes we make today only affect how the board calculates search-for-work and interim employment expenses, not whether these expenses are a permissible remedy.”

But in his dissent, Member Miscimarra wrote, “I do not discount the fact that parties and claimants experience substantial, often oppressive non-monetary consequences as the result of unfair labor practices. “Nonetheless, the NLRA only permits the board to award relief that is remedial.”

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.

NLRB Wants Former Employers to Pay for Job Search Expenses of Former Employees

National Labor Relations Board General Counsel Richard Griffin instructed NLRB Regional Offices to request employees be reimbursed for job search costs and work-related expenses they incur due to violations of the National Labor Relations Act. This order modified a 2011 order by then acting-general counsel Lafe Solomon.

Solomon wrote that the Board’s practice was to consider such amounts payable only to the extent they did not exceed the “interim earning” an employee managed to earn after an unlawful discharge or loss of employment. Under that practice, if an individual did not have interim earnings, the NLRB would not seek payment for expenses on behalf of the individual. Solomon instructed Regional Offices to calculate “search-for-work and work-related expenses” for such employees and to charge them against the offending company “regardless of whether the discriminate received interim earnings during the period.”

So assuming a grocery store in Ohio unlawfully discharged an employee, and that employee applied for a job at a grocery store in Hawaii and traveled to Hawaii for an interview, would the Ohio grocery store be required to reimburse the employee for his Hawaiian vacation job interview? And, would it matter if the applicant vacationer turned down a job offer? Or, if he purposefully bombed the interview so he wouldn’t receive a job offer? This rule, like so many from the Board recently, leave us with so many unanswered questions.

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.

NLRB Requires Employers to Pay Employee Taxes on Back Pay

The Board’s determination to force employers to pay the taxes on back pay employees received as the result of filing an unfair labor practice charge with the NLRB was invalidated by the Noel Canning decision. But a few months later, the Board re-ruled in the same way on the same case. Employers must pay Social Security and income taxes on lump sum back pay awards. In theory, if an employee usually makes $25,000 per year and is owed $50,000 in back pay, then that lump sum payment will put the employee in a higher tax bracket (having received $75K that year) than it otherwise would have been had if it made $25K for three consecutive years. The Board believes having the employee who made more money pay more taxes is not fair, so it unilaterally sticks the employer with the bill.

Undocumented Workers Entitled to Recover Unpaid Wages Under FLSA But Not Backpay Under NLRA

Illegal aliens who want to sue their employers for unpaid wages should do so in federal court in Arkansas, Iowa, Minnesota, Missouri, Nebraska, North Dakota, or South Dakota. Not in New York, D.C., or Connecticut.

An employer failed to properly complete Form I-9s verifying its workers’ employment eligibility. The workers sued for unpaid minimum and overtime wages. The Eighth Circuit – covering the strip of states in the middle of the country – awarded the workers damages. In doing so, it rejected the employer’s argument that the workers could not recover overtime or minimum wage because they were undocumented workers.

The Eighth Circuit reasoned that requiring wage payments for undocumented workers reduces any economic incentive to hire undocumented workers. Conversely, exempting unauthorized workers from overtime and minimum wage would frustrate the purposes of the Immigration Reform and Control Act (the IRCA) because the acceptance of substandard wages and working conditions for undocumented workers could seriously depress the wage scales and working conditions of authorized foreign workers.

If the above lawsuit was filed in the Second Circuit (NY, DC, CT) there may have been a different outcome. A group of undocumented aliens there were discharged for engaging in activity protected by the National Labor Relations Act but were denied backpay and reinstatement because they were undocumented aliens. The Second Circuit said that the undocumented aliens cannot recover because they were not lawfully employed to begin with. This case was sent back to the NLRB who is now determining whether the employees should be reinstated, minus backpay. This case also relied on the IRCA in reaching its conclusion.

Many of the smaller employers that I represent do not know about Form I-9 or that each employee must complete one at the time of hire. Or worse, they know about it, but do not do it. I repeatedly tell these companies that they are playing with fire. Employers can be audited at any time and penalties for non-compliance start at $100 – $1000 per day per violation.

All it takes is for a disgruntled former employee to call the government alleging a violation of most any workplace law – or have her attorney do so on her behalf – and companies will be required to prove that they have correctly completed Form I-9s for every employee. Remember, both lawsuits above were over wages, not immigration status. Government agencies are now connected with each other, share the same computer servers, and openly talk to each other about companies under investigation.

Matt Austin is a Columbus, Ohio employment lawyer who owns Austin Legal, LLC, a boutique law firm with offices in central and northeast Ohio that limits its representation to employers dealing with labor, employment, and OSHA matters. You can email Matt at Austin@LaborEmploymentOSHA.com or call him at 614.285.5342.

HRACO Labor Relations SIG Preview

As appearing in the Human Resources of Central Ohio (HRACO) monthly newsletter 


Are You Coming to the HRACO Labor Relations SIG to Learn About These Important Changes From the National Labor Relations Board? 

Thank you for such great feedback and enthusiasm for HRACO’s first Special Interest Group dedicated exclusively for traditional labor matters. A time, date, and location have been set! The first meeting will be held on Tuesday, February 19th at Trustaff from 8:30 – 9:30. The address for Trustaff is: 470 Olde Worthington Rd., Suite 200, Columbus, OH 43082. Thank you to HRACO’s President Nicole Smith for hosting this first meeting.

Now onto some of the topics up for discussion at the HRACO Labor SIGs. 

How the Pro-Union NLRB Impacts Every Company

The Board is made up of five Members who are usually appointed by the President and confirmed by the Senate. The political affiliation of the Board is supposed to include two Republicans, two Democrats, plus one person from the President’s party. Under President Bush, there were usually three Republicans and two Democrats. Under President Obama, there are currently just three Democrats (zero Republicans) including a former union attorney who had long represented the Teamsters, SEIU and the CWA and the former General Counsel of the International Union of Operating Engineers – although he was recently named as a defendant in a RICO lawsuit for allegedly firing an employee who blew the whistle on the union’s embezzlement scheme. Together these individuals have and will continue to create union-friendly laws such as:

  • Micro Bargaining Units  Unions can now organize employees by job titles instead of the traditional “community of interest” standard. Employers face the likelihood of several small bargaining units that are easier to organize and several union contracts that are more difficult to administer. For example, just the ladies’ shoe department of a major department store was recently permitted to unionize paving the way for the men’s department, perfume counter, children’s section, housewares, men’s suits, and handbag departments (17 different departments for 382 employees) to all be represented by different unions.
  • Persuader Rules  This rule, which is anticipated to take effect in April 2013, seeks to force companies to disclose to the federal government where and from whom they receive labor relations advice and how much they paid for that advice, whether spending $20 at a luncheon listening to a speaker or several thousand dollars defending a union organizing drive. Labor lawyers, like me, believe this rule violates the attorney-client privilege.
  • Social Media  Tweets, Facebook posts, and the like can be considered “protected concerted activity,” and employers are not allowed to discipline or discharge employees for engaging in such conduct. Protected concerted activity is when an employee acts on behalf of a group of employees regarding a term or condition of employment. For example, a tweet like: “I hate my job. My boss plays favorites, and I don’t make enough #&@^$ money to put up with him” is probably protected concerted activity, and that employee – regardless whether she is in a union – cannot be disciplined or discharged despite possibly breaking several employment-related policies. Further, the Board’s strict rules of acceptable social media policies results in the vast majority of policies violating the Act. Seeking legal advice before implementing a social media policy is prudent.
  • Arbitration Agreements  The NLRB prohibits all employees from signing arbitration agreements that prevent them from joining other workers in class-action arbitration proceedings or lawsuits.
  • End of Confidential Workplace Investigations  The hallmark of a workplace investigation is that the information provided remains confidential until all the facts are uncovered and a decision is made. While human resources cannot promise anonymity in investigations, most policies ensure as much confidentiality as possible. These policies are now unlawful according to the NLRB. Subject to certain limitations, employers cannot require confidentiality during ongoing workplace investigations. Specifically, discussing an investigation with co-workers is considered “collective activity” under the Act and trumps workplace policies of confidentiality during investigations.
  • Open Door Policies  The following policy from a handbook violated the NLRA: “Voice your complaints directly to your immediate supervisor or to human resources through our ‘open door’ policy. . . Complaining to your fellow employees will not resolve problems” because it allegedly prohibited employees from speaking to co-workers about terms and conditions of employment.
  • At-Will Disclosures  A handbook clause that states an employee’s at-will status can be changed only by a corporate executive may lead an employee to believe that being represented by a union or having a collective bargaining agreement would be futile because neither of those could alter the at-will status. As such, the Board has forced non-union companies to change the at-will language in their handbooks.
  • Moonlighting Policy  A moonlighting clause banning employees from outside employment without prior written consent from the employer may now violate the NLRA if it has an unlawful motive or was implemented with anti-union animus, i.e. to prohibit union organizers from obtaining employment at non-union companies.
  • Limiting Off-Duty Employees’ Access to Company Property  Limiting off-duty access to the workplace except with management approval or when employees are engaging in employer-related business is unlawful because the limitation could prevent employees from engaging in Section 7 rights, such as union organizing, without management’s approval.
  • Work During Working Hours  A company rule requiring employees to only perform work during working hours violates the Act because such rule could confuse employees into believing that they cannot engage in union solicitation during breaks and lunches. According to the NLRB, “working hours” now means time when you are at work, not time spent actually working.

How the NLRB’s Pro-Union Agenda Impacts Unionized Employers, Specifically

The Board’s pro-union agenda does not just focus on non-union employers. Companies that deal with labor unions on a daily basis must also be cognizant of several major changes in the law, some of which are:

  • Discipline  Employers must now bargain with a union over discretionary discipline during negotiations for a first collective bargaining agreement.
  • Dues Deduction  In overturning a 50-year law, employers must now continue automatic dues deduction after the expiration of a union contract.
  • Beck Objectors  The Board believes that lobbying expenses are germane to the union’s duties as bargaining agent and thus chargeable back to Beck objectors.
  • Witness Statements  In overturning a law from 1978, witness statements from employees to employers are no longer exempt from disclosure to unions absent assurance of confidentiality to employees, nor do they qualify as privileged under the attorney work-product doctrine unless “specifically created in anticipation of foreseeable litigation.”
  • Backpay  In most cases where backpay is awarded as a remedy, the losing employer not only has to pay the backpay (and interest), it must also pay the employee’s taxes associated with the backpay, i.e. social security and income taxes.

NLRB’s Pro-Union Agenda’s Forecast for the Future

While much of what the Board will do in 2013 is obviously not yet determined, below are some educated estimates of future changes.

  • Shorter Election Cycles  Currently, the time between when a union files a petition to represent employees and the representation election averages around 45 days. Statistically, the shorter the time period, the likelier employees will vote in favor of union representation. The Board has opined that this period should be “as short as possible” and “quickie elections” with time periods as short as 5-7 days is likely. Employers should actively engage in union-avoidance and pro-employee relations now, as waiting to campaign against unionization until after a representation petition is filed is too late.
  • Hang the Poster  Employers will be required to hang a poster throughout the workplace that specifically informs workers of their right to organize a union and how to learn more about the process of organizing a union.
  • Unions Granted Equal Access  Currently, an employer’s property is its private property and unions, for the most part, are not allowed to trespass. Unions will likely receive greater (if not equal) access to an employer’s property to engage in union organizing activity.
  • Email for Union Organizing  Currently, an employer can place restrictions on how its employees utilize company-furnished email accounts and electronic devices. This will probably change. For example, organizers will be permitted to solicit employees to attend the next organizing meeting, and pro-union employees will be allowed to openly campaign in favor of unionization through company provided technology.
  • Card Check  Richard Tumka, head of the AFL-CIO who claims he talks to the White House every day and visits a few times each week, promised that if Obama won a second term as President, that card check will be a reality. The only thing standing in way of card check is a Republican controlled Senate. If Democrats regain control of the Senate in 2014, card check will be a reality.
  • Temporary Workers  Currently temporary workers do not pay union dues and do not work under the confines of a union contract. It is anticipated that temporary workers – who are not employed by the unionized employer – will have the right to organize and belong to a union alongside the employer’s regular, full time employees. 

What Should HRACO Members Do

HRACO members should continually educate themselves about the onslaught of grave labor law changes from the NLRB. Employers must train supervisors on compliance matters as well as union-avoidance strategies to diminish the Board’s governance of your company as much as possible. Since the above was written for informational purposes and not legal advice, companies are encouraged to seek legal counsel to ensure they are complying with the law as even the smallest form of non-compliance can result in significant detriment to your company. Attendance at HRACO Labor SIGs – held on the third Tuesday of every month from 8:30 to 9:30 – will provide education and guidance on many of these issues.

Matt Austin is a Columbus, Ohio labor lawyer who owns Austin Legal, LLC, a boutique law firm that limits its representation to employers dealing with labor, employment, and OSHA matters. Matt can be reached by email at
Matt.Austin@Austin-Legal.com or by phone at 614.285.5342.