Wyatt Employment Law Report


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NLRB Issues First Social Media Decision and Invalidates “Courtesy” Policy

By George J. Miller

On September 28, 2012, the National Labor Relations Board issued its first decision in one of the social media cases which have garnered so much attention in the last year and a half.  The case is Karl Knauz Motors, Inc., d/b/a Knauz BMW, 358 NLRB No. 164.  This was the case of a BMW salesman named Becker who was fired after posting photos and a critical message on his Facebook page about the dealership’s choice of inexpensive food (hot dogs, small bags of chips, cookies, and bottled water) for a sales event promoting a new car model to customers.  At a meeting before the event, Becker and other sales people expressed their disappointment about the choice of food and their concern that it would send the wrong message to their clients and negatively affect their commissions.  At the sales event, Becker took photos of the food.

During the same week as the sales event, an underage driver drove a vehicle off the lot of a dealership across the street and into a pond in front of the BMW dealership.  The BMW employees gathered to watch the commotion, and Becker took photos.  He posted these photos on his Facebook page along with the comment, “Oops.”  At the same time, he posted the photos of the sales event, with critical comments.  Before he posted the photos about the sales event, he told his co-workers what he planned to do. 

The dealership fired Becker, and he then filed an unfair labor practice charge at the NLRB.  The Acting General Counsel of the NLRB decided to issue a complaint against the dealership on the basis of evidence that (a) Becker was fired at least in part because of his posting about the sales event, and (b) this posting was protected by the law because it addressed terms of employment–the possible effect of the food choice on commissions–and Becker was voicing the sentiments of other salespeople and was continuing the course of activity that began at the group meeting before the sales event. 

At the trial, the dealership defended by arguing that the one and only reason it fired Becker was because of his Facebook posting about the car accident, a serious matter, not the posting about the sales event.  The judge agreed with the dealership on this point, and so did the NLRB on review.  They concluded that the posting about the accident was not protected, concerted activity, but rather that it was, “posted as a lark, without any discussion with any other employee [of the dealership] and had no connection to any of the employees’ terms and conditions of employment.”  In ruling that the dealership’s only motive in terminating Becker was the Facebook posting about the accident, the NLRB did not have to decide whether the posting about the sales event was protected activity.

However, the judge and the NLRB also found that the dealership’s “Courtesy” policy in its employee handbook violated the law because it would tend to chill employees in the exercise of their rights under the law.  The Courtesy policy said:

“(b) Courtesy: Courtesy is the responsibility of every employee.    Everyone is expected to be courteous, polite and friendly to our customers, vendors and suppliers, as well as to their fellow employees.  No one should be disrespectful or use profanity or any other language which injures the image or reputation of the Dealership.”

A two member majority of the three NLRB members who presided over the case agreed with the judge and held that this policy violated the law because employees could reasonably understand its broad prohibition against “disrespectful” language and “language which injures the image or reputation of the Dealership” to prohibit employees from objecting to their working conditions–whether to co-workers, supervisors, managers, or third parties–and seeking to improve them.  Under the National Labor Relations Act, employees have the collective right to object to their working conditions.

In dissent, NLRB Member Hayes argued that the majority’s decision goes too far, because it, “invalidates any handbook policy that employees conceivably could construe to prohibit protected activity, regardless of whether they reasonably would do so.”  Member Hayes argued that the majority read the words “disrespectful” and “language which injures the image or reputation of the Dealership” in isolation and did not give the whole policy a reasonable reading, contrary to precedent.  He opined that, “employees and employers alike have a right to expect a civil workplace, promoted through policies like the one that my colleagues find unlawful.”  Read in this context, he believed the policy complies with the law.

In view of this new decision and the recent efforts of the Acting General Counsel to attack the policies of non-union employers, it would be wise for all non-union employers to review their policies for compliance with the National Labor Relations Act and amend or rescind them as necessary.


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House Committee Passes Measure to Roll Back Several Recent Actions by the NLRB

 By Edwin S. Hopson

On October 26, 2011, the U.S. House Committee on Education and the Workforce passed the Workforce Democracy and Fairness Act (H.R. 3094), a measure intended to roll back a number of recent actions by the National Labor Relations Board (NLRB). Specifically, H.R. 3094 would:

●Provide employers at least 14 days to prepare their case to present before a NLRB election hearing officer and an opportunity to raise additional concerns throughout the hearing process up to the close of the hearing.

●Provide that no NLRB representation election will be held in less than 35 days after filing of the petition.

●Reinstates the traditional standard for determining which employees will be eligible to vote in the union election.

●Provides that once an election is directed, eligible voters in the election must select in writing what sort of personal contact information they want released to the petitioning union in addition to their name, i.e., telephone number, email address, or mailing address.

 The vote was 23 to 16.


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House Committee Holds Hearing on Proposed Legislation to Roll Back/Block NLRB Actions

On October 12, 2011, the U.S. House Education and the Workforce Committee held a hearing on the proposed “Workforce Democracy and Fairness Act” (H.R.3094) recently introduced by Republicans.  The purpose of the legislation is to the proposed legislation is to roll back some recent decisions of the National Labor Relations Board and block its proposed rule that would speed up the representation election process.  Specifically, H.R. 3094 would:

●Provide employers at least 14 days to prepare their case to present before a NLRB election hearing officer and an opportunity to raise additional concerns throughout the hearing process up to the close of the hearing.

●Provide that no NLRB representation election will be held in less than 35 days after filing of the petition.

●Reinstates the traditional standard for determining which employees will be eligible to vote in the union election.

●Provides that once an election is directed, eligible voters in the election must select in writing what sort of personal contact information they want released to the petitioning union in addition to their name, i.e., telephone number, email address, or mailing address.

Witnesses testifying were: attorney Charles Cohen, a Republican and former Member of the National Labor Relations Board, Robert Sullivan, President of R.G. Sullivan Consulting, on behalf of the Retail Industry Leaders Association, attorneys Michael J. Hunter, who represents unions, and Phillip B. Russell, who represents employers. 

The proposed legislation may pass the House, but most certainly cannot pass in the Senate at this point in time.


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President Obama Renews Support for the Proposed Employee Free Choice Act and Makes Other Comments Concerning Labor Issues

By Edwin S. Hopson

Earlier this month, President Obama spoke to the AFL-CIO Executive Council at a meeting in Washington D.C.  He had some interesting comments about the Employee Free Choice Act (EFCA).  He stated, in part:  “[g]etting EFCA through the Senate is going to be tough. It’s always been tough; it will continue to be tough. We’ll keep on pushing.”

The President also commented about the National Labor Relations Board.  “[w]e are going to make sure that the National Labor Relations Board is restored to have some balance so that if workers want to form a union, they can at least get a fair vote in a reasonable amount of time.”

Apparently referring to labor consultants many employers use in union organizing campaigns, President Obama said this:  “[a]nd we don’t want, by the way, government dollars going in to pay for union busting. That’s not something that we believe in. That’s not right. That tilts the playing field in an unfair way.”

The full text of the President’s remarks can be found at http://www.whitehouse.gov/the-press-office/remarks-president-afl-cio-executive-council.


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The HIRE Act: Tax Incentives for Hiring the Unemployed

By Debra Dawahare

The HIRE (Hiring Incentives to Restore Employment) Act, signed into law on March 10, 2010, gives a tax break to businesses that hire unemployed workers before January 1, 2011.

To qualify the employer for the benefit, the new employee must sign an affidavit saying that he or she was employed for 40 hours or less during the 60 days before the new employment began,  and  the hiring must occur after February 3, 2010  but before January 1, 2011.  The new employee must not replace another employee, unless that employee voluntarily quit or was dismissed for cause. 

While the employer will still have to withhold Social Security taxes for the new employee, HIRE provides that the employer will get a tax credit for it, beginning in the second quarter of 2010.  Previous rules regarding the employer’s share paid for Medicare taxes will still apply. 

If the business retains the new employee for 52 weeks, it will receive a one-time tax credit for such retention. 

Employers should check with their CPAs or tax attorneys regarding  HIRE’s potential benefits for them.


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New Health Care Bill Includes Whistleblower Protection

By Kim Koratsky

Ongoing review of the Patient Protection and Affordable Care Act (“PPACA”) is much like a long hike through an unfamiliar forest; each time we go around a turn, we find something that we have not seen before.  Included in its many provisions, the PPACA contains whistleblower protection for persons who report abuses or fraudulent conduct in the delivery of health care.

The PPACA whistleblower provisions amend the Fair Labor Standards Act (FLSA).  The amendment provides protection to employees who report fraud waste and other violations under Title I of the PPACA, which applies to “conventional” medical care settings (i.e., hospitals, clinics and physician offices), and other violations in individual and group health plans covered by Title I of the PPACA.   The amendment does not, apparently, extend to violations of Titles II through X of the PPACA.  Thus, unprotected employees would include those working in administration of Medicare and Children’s Health Insurance Program (CHIP) expansion, Medicaid, Medicare and CHIP program integrity, nursing home care for the elderly, innovative treatment and therapies, payments and reimbursements, prescription drugs and preventative care, house-call visits, expansion and increasing training for the health care workforce, and grants for expansion of health care to under-served populations.  Protected activity under the PPACA provisions includes situations where an employee:

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Senate Sends Jobs Bill to President for Signature

By Kim Koratsky

A 68-29 vote in the Senate will send a bill to President Obama that will offer tax breaks to employers who hire the unemployed.  The bill, which passed March 16, offers $18 Billion in tax breaks and pumps $20 Billion into highway and transit programs.  Under this new legislation, businesses that hire the unemployed will be exempt from the 6.2 percent Social Security payroll tax through December and employers can receive an additional $1,000 credit if the new workers stay on the job a full year.  Beyond these provisions, the bill also extends the highway and mass transit programs through the end of the year.  President Obama has promised to sign the legislation.