When Barack Obama ran for president, his message was all about hope and change. But a recent decision by one regulatory agency makes it seem like it may all just be politics as usual in Washington. That decision, by a politically appointed board, seems to represent an end run around Congress.

Several years ago, the proposed Employee Free Choice Act (EFCA) was a major concern for employers with workforces that were considering or might consider unionizing. If EFCA became law, those employees may not be able to use a secret ballot to vote, but would have to rely on a so-called card-check system where they would have to cast their votes by signing cards in public. It would also have forced new unions and management to come up with a bargaining agreement no more than 90 days after the union was recognized. If they failed to agree, a federal mediator would impose a contract that would be in effect for at least two years.

Employers breathed a sigh of relief when EFCA failed to become law, first in 2007 and then again in 2009, despite the public support of then-senator and now President Barack Obama. However, employers may once again need to consider that a type of card-check system could be put in place after all, since a new avenue has been recently opened up. In August, the National Labor Relations Board (NLRB), with several new members appointed by President Obama, announced that it plans to revisit its decision in Dana Corp. Any reworking of Dana could lead to a card-check system, along with other implications for union-forming activities.

In its 2007 ruling, the NLRB recognized that employees needed freedom of choice when it comes to unionizing. Under Dana, employees were granted the right to immediately challenge voluntary card-based union recognitions and to call for a secret ballot election. According to Dana, workers who want to challenge a card-check vote have 45 days to petition for an election or to support a rival union.

The NLRB’s decision to revisit Dana has been a controversial one, just like the current membership of the board itself. When President Obama took office, Congress refused to appoint two of his nominees. Undeterred, Obama named Democrats and union attorneys Craig Becker and Mark G. Pearce to the board during a congressional recess. At the same time, the president declined to appoint the Republican nominee, who was eventually named to the board several months later.

At the time, the U.S. Chamber of Commerce blasted the president’s move, particularly Becker’s appointment. Becker is a former associate general counsel to both the Service Employees International Union and the American Federation of Labor & Congress of Industrial Organizations.

“This recess appointment disregards the Senate’s bipartisan rejection of Craig Becker’s nomination to the NLRB,” said Senior Vice President of Labor, Immigration, and Employee Benefits Randel K. Johnson, in a statement at the time. “Overriding the will of the Senate and providing this special interest payback contradicts the president’s claim to change the tone in Washington. The business community should be on red alert for radical changes that could significantly impair the ability of America’s job creators to compete.”

Now that Dana may be tossed out, employers with workforces that may be susceptible to unionizing should pay careful attention to how the NLRB rules in this matter. The board’s decision could have far-reaching implications on the basic relationships between employers and employees.

RETHINKING DANA

The board has acknowledged that its initial 2007 decision in Dana was an important one that has had a significant impact on unionization activities. “Dana represented a major departure from prior law and practice respecting voluntary recognition agreements,” the NLRB noted.

In its original decision, the NLRB was attempting to find a “finer balance” between the often “competing interests of protecting employee freedom of choice on the one hand, and promoting the stability of bargaining relationships on the other.” According to the NLRB, this balance warranted delaying the imposition of barring union recognition for a 45-day window period.

If the NLRB now decides to overturn Dana, a result which seems quite likely, workers may lose the chance to participate in a secret ballot election and find themselves willingly or unwillingly involved in a card-check process. It could also have an impact on collective bargaining agreements.

When it comes to the board’s decision to review Dana, politics seems to have played an important role. There are five members on the NLRB, each appointed by the president to five-year terms, and confirmed by the Senate. One member rolls off the board and is replaced every year. The NLRB that passed the first decision was made up primarily of Republicans; the board that voted to revisit it is now primarily Democrats. The vote to revisit Dana was 3-2. Those who voted in favor of a review are Democrats, and the two dissenters are both Republicans. According to the two dissenters, the results from Dana speak for themselves, and there is no need for further review. According to the dissenters, since Dana was decided, the NLRB has received 1,111 requests for voluntary recognition resulting in 54 secret ballot elections. In approximately 25 percent of these elections, the employees have voted to reject the union.

This proves, according to the dissent, that “Dana has served its purpose of protecting employees’ free choice without discouraging voluntary recognition or the overall process of collective bargaining. There is not a scintilla of objective evidence to the contrary.”

BYPASSING CONGRESS?

According to some observers, a reworking of Dana may be a way to achieve at least some of the same aims of EFCA, while doing an end-run around Congress. Those who follow EFCA know that President Obama has been an unabashed supporter of the act. While on the stump in 2008, he announced: “I’ve fought to pass the Employee Free Choice Act in the Senate. And I will make it the law of the land when I’m president of the United States of America.” He repeated that pledge to organized labor in his 2010 State of the Union speech.

In its latest version, EFCA would amend the National Labor Relations Act in several ways. First is the so-called card check feature, which would allow a union to be certified if union officials collect the signatures of a majority of workers. After the union is recognized, employers and unions would have at most 120 days to enter binding arbitration to create a collective agreement. The bill would also boost the penalties against employers who discriminate against workers for their union activities.

Those who oppose EFCA worry that the card-check method will lead to intimidation or even coercion for those who may not want to join unions, by making each person’s vote public. Some also worry that, by forcing binding arbitration within 120 days after unionizing, employers and unions may have to resort to bare-knuckle tactics to beat the deadline.

Considering the current makeup of the NLRB, employers should prepare themselves for the overturning of Dana. The board has signaled that it may also make other changes regarding unionization activities, including giving union organizers equal time on the employer’s premises if the employer speaks to the employees regarding unionization. It is important for employers to stay informed and work closely with legal counsel to prepare for significant changes that could follow.

Publication date: 11/22/2010