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HIGHLIGHTS
FOR THE MONTH OF FEBRUARY 2007
By Darryl
G. McCallum
RECENT DEVELOPMENTS
Employer
Policy Against On Duty and Off Duty Fraternization Violates
NLRA
Rejecting the view of the National Labor Relations Board,
the United States Court of Appeals for the District of Columbia
recently decided that an employer’s policy prohibiting
on duty and off duty fraternization among employees was
illegal because it could have a “chilling” effect
on employee rights under the NLRA.
Facts of the Case: In Guardsmark,
LLC v. National Labor Relations Board, the employer,
a nationwide firm providing security guard services, issued
a handbook to its uniformed employees that contained three
specific work rules that the Union challenged. These rules
included: (1) a “chain of command” policy that
employees “not register complaints with any representative
of the client,” (2) a solicitation rule, prohibiting
solicitation and distribution of literature “at all
times while on duty or in uniform,” and (3) a fraternization
rule, stating that employees were not allowed to “fraternize
on or off duty, date or become overly friendly with the
client’s employees or with co-employees.” After
a hearing, the Administrative Law Judge (“ALJ”)
found that that the chain of command policy violated the
NLRA because it prevented employees from seeking client
assistance regarding any aspect of their employment. The
ALJ upheld the solicitation rule as intended to prohibit
unofficial activity while in uniform and permitting employees
to comply with this rule by removing or covering their uniforms.
The ALJ also found the fraternization rule valid because
it was intended to prevent interpersonal relationships that
may compromise security, not to preclude protected activity.
The NLRB adopted the ALJ’s conclusions regarding the
chain of command rule and the fraternization rule, but disagreed
that employees would reasonably understand that they could
comply with the solicitation rule by removing or covering
their uniforms. Both parties appealed the rulings.
The Court’s Ruling: The
Court upheld the NLRB’s decision regarding the illegality
of the chain of command rule and the solicitation rule.
The Court, however, rejected the NLRB’s decision that
the fraternization rule did not violate the NLRA. In particular,
the Court was concerned that the fraternization rule would
have a chilling effect on protected concerted activity because
employees could easily interpret the rule to prohibit discussing
terms and conditions of employment. The Court, relying on
dictionary definitions of the word “fraternize,”
concluded that the term was broad enough to encompass not
only social and personal relationships, but also discussion
of the terms and conditions of employment. The Court was
particularly concerned that the rule barred employees from
fraternizing with each other at all times and without regard
to location.
Lessons Learned: While it
is permissible to have policies prohibiting dating amongst
employees, such policies must be carefully worded to avoid
being interpreted as prohibiting employees from discussing
their terms and conditions of employment or otherwise engaging
in union-related activity. For instance, as the Court of
Appeals pointed out in this case, the employer could have
clarified its fraternization rule either by removing the
word “fraternize” or by defining the term to
encompass only romantic relationships and not protected
concerted activity.
Employee
Free Choice Act Clears Congressional Hurdle
On February 8, 2007, the House Education and Labor Committee,
by a 26-19 vote, approved the Employee
Free Choice Act (“EFCA”) (H.R. 800), clearing
the way for it to be considered by the full House. If passed,
the EFCA would amend the NLRA, resulting in sweeping changes
in the areas of union organizing and collective bargaining.
Legislative History and Key Provisions. Introduced in the House on February 5, 2007 by U.S.
Representative George Miller (D-CA), Chair of the House
Education and Workforce Committee, the EFCA contains five
key provisions. First and foremost, the EFCA would require
that employers recognize a union as the exclusive bargaining
representative for a group of employees where a majority
of the employees have signed union authorization cards (i.e.,
the “card check” process). The other key provisions
of the law are as follows: (1) if a union is certified and
the employer and the union cannot agree on a first contract
after 90 days, either party can request assistance from
the Federal Mediation and Conciliation Service and, if mediation
does not result in a binding contract within 30 days, the
Service must refer the matter to binding arbitration (which
would result in a Collective Bargaining Agreement that is
binding on the union and the employer for two years); (2)
employers found to have unlawfully discriminated against
an employee in connection with a union campaign or in relation
to the first contract will be liable for backpay as well
as two times the amount of backpay as liquidated damages;
(3) in addition to any other make-whole remedy, civil penalties
of up to $20,000 per violation can be imposed against employers
who willfully or repeatedly violate employees’ rights
in either a campaign or in negotiation of the first contract;
and (4) injunctive relief is available whenever the NLRB
has “reason to believe” that an employer has
discharged or threatened to discharge an employee, or has
engaged in conduct that significantly interferes with employee
rights either during an organizing campaign or in negotiation
of the first contract.
Changes to Current Law. Under
current law, to recognize union status, a majority of workers
must vote in favor of union representation in an NLRB-supervised
secret ballot election. While an employer may agree to recognize
a union under the card check method, it is not required
to do so. Under the EFCA, an employer would be required
to recognize a union formed under the card check method
and could no longer insist on a secret ballot election.
Moreover, the binding arbitration provision for first contracts
would also give unions more power. Currently, employers
and unions are free to bargain as they please so long as
they both act in good faith. Imposing mandatory arbitration
after 90-120 days of negotiations will limit the employer’s
bargaining power and make the first CBA subject to the decision
of a panel of arbitrators who are free to order the agreement
they deem best.
The Bill’s Future. If
passed, the EFCA would deprive employees of the opportunity
to hear the employer’s side of the union question
because the new legislation would eliminate secret ballot
elections and the campaigning that usually accompanies those
elections. The EFCA does face an uphill battle, however,
because even if passed by the House, it would still need
Senate approval, which is less likely. In addition, President
Bush is likely to veto the bill should it actually pass
Congress.
Employer
Can Consent to Fourth Amendment Search of Employee's Work
Computer
The United States Court of Appeals for the Ninth Circuit
rejected an employee’s challenge to his conviction
for viewing child pornography over the Internet premised
on the argument that the employee did not consent to a search
of his work computer.
Facts of the Case: In United
States v. Ziegler, the Defendant, who was Director of
Operations for a company that processes on-line electronic
payments, had accessed child pornography from his work computer.
The owner of the company’s Internet Service Provider
contacted the Federal Bureau of Investigations (the “FBI”)
with a tip that the employee had been viewing child pornography.
The FBI agent followed up on the tip by contacting the company’s
IT Administrator, whose job duties included monitoring employee
use of workplace computers, including their Internet access.
The IT Administrator fully cooperated with the FBI agent,
and informed him that the company had in place a firewall
which permitted constant monitoring of employees’
Internet activities. Significantly, the company routinely
monitored all workplace computers and informed employees,
through the employee handbook, of the company’s monitoring
efforts, and that the computers were company-owned and not
to be used for personal activities. The IT department placed
a special monitor on the employee’s computer and,
at the behest of the FBI agent, backed up the computer’s
hard drive. The IT department, through such monitoring,
confirmed that the employee had indeed viewed child pornography
on his work computer, which was located in his private office.
The employee was arrested, indicted and plead guilty to
receipt of child pornography.
The Court’s Ruling: The employee challenged his conviction solely on the grounds
that the entry into his office to search his work computer
violated his Fourth Amendment right against unreasonable
searches and seizures. Specifically, he argued that he had
a reasonable expectation of privacy in his workplace computer,
and that a warrantless search of his workplace computer
was illegal. The Ninth Circuit Court of Appeals agreed with
the employee that he had a legitimate expectation of privacy
in his workplace computer, which was password-protected
and was kept in his locked private office. The Court reasoned
that in the private employer context, “employees retain
at least some expectation of privacy in their offices.”
The Court concluded, however, that the employer exercised
authority over the office and the computer such that it
could validly consent to a search regardless of the employee’s
wishes. Specifically, the employer advised its employees
in writing that their computers remained company property
and were subject to monitoring, and the employer actually
did routinely monitor employees’ Internet use to ensure
that no one visited unprofessional Internet sites. Thus,
the employer validly consented to the search and the evidence
seized was admissible.
Lessons Learned: An employer
that maintains and disseminates to its employees a policy
providing that workplace computers remain the employer’s
property, subject to monitoring at any time, and who then
follows through with monitoring, will negate whatever privacy
expectations an employee may have. Consistent with such
policy, the employer may search the computer on its own
and may even consent to a search of the computer by law
enforcement officials.
TAKE NOTE
Class Actions. The United States Court of Appeals for the Ninth Circuit
has affirmed a trial court decision granting class certification
in a lawsuit alleging that more than 1.5 million past and
present female employees were subjected to gender discrimination
in pay and promotion. If the Court of Appeals’ decision
stands, this would constitute the largest civil rights class
action ever against a private employer. In Dukes,
et al. v. Wal-Mart, Inc., the employer challenged the
district court decision arguing, among other reasons, that
the plaintiffs had failed to show a common, company-wide
policy and practice of discrimination, and that the plaintiffs’
request for punitive damages demonstrated that monetary
relief predominated over declaratory and injunctive relief,
thereby making class certification inappropriate. In a 2-1
decision, a panel of the Ninth Circuit concluded that the
company’s arguments regarding the plaintiffs’
failure to show a corporate-wide policy and practice of
discrimination “are of the type that goes to the weight,
rather than the admissibility, of the evidence,” and
are improper at the class certification stage. The Court
then concluded that the potential for billions of dollars
in punitive damages did not alter the suit’s status
as primarily for injunctive and declaratory relief. The
Court of Appeals recognized that focusing on the potential
size of a punitive damages award would have the perverse
effect of making it more difficult to maintain a class action
against an extremely large employer, or an employer whose
conduct may be especially egregious. The employer is expected
to appeal the panel’s decision to the full Ninth Circuit
Court of Appeals.
Mandatory Sick Leave. On February 5, 2007, a new law went into effect in San Francisco,
California mandating that employers provide paid sick leave
to their employees. According to the new law http://www.sfgov.org/site/uploadedfiles/olse/Paid_Sick_Leave_Ordinance,_Administrative_Code_Chapter_12W.pdf,
employers of ten or more employees (including full-time,
part-time and temporary employees) must provide up to 72
hours (or about nine days) of paid sick leave annually.
Employers of fewer than ten employees must provide up to
40 hours (or about five days) of sick leave annually. Seven
states, including Maryland, Maine, Massachusetts, Michigan,
Montana, Vermont and Wisconsin are expected to consider
similar legislation this year. Congress is also considering
legislation that would require employers with at least 15
workers to offer seven paid sick days annually to employees.
In addition to cost and policy modification concerns, such
laws will inevitably spark new litigation by employees who
claim they were wrongfully denied sick leave or that they
were subjected to an adverse employment action in retaliation
for seeking use of paid sick leave.
EEOC Charges of Discrimination. The Equal Employment Opportunity Commission (EEOC)
has released its Fiscal Year 2006 charge data. The EEOC
reports that last year it received a total of 75,768 discrimination
charges against private sector employers, the first increase
in charge filings since 2002. The charge
statistics show that charges based on race (27,238),
sex (23,247), and retaliation (22,555) were the most frequent
allegations, as in past years. Charges in all categories
increased from FY 2005, with the exception of age and equal
pay claims. The EEOC and state and local agencies received
a record 4,901 pregnancy discrimination charges in FY 2006.
Lastly, of the 12,025 sexual harassment charges filed last
year, a record 15% were filed by men.
TOP TIP
Is Your Workplace
OSHA Compliant?
On February 12, 2007, the Department of Labor’s Occupational
Safety and Health Administration (OSHA) announced publication
of its new “It’s the Law” poster. Also
known as the OSHA Notice of Employee Rights, the OSHA poster
is required to be displayed in every workplace in America.
The new poster, which can be found on OSHA’s
website, informs employees of their OSHA rights and
reminds employers of their obligation to furnish a workplace
free of recognized hazards and to comply with OSHA standards.
Employers are not required to replace their current OSHA
posters with the new one.
OSHA’s new poster serves as a reminder to review
workplace policies and practices to make sure they are OSHA
compliant. Of course, any employer should be aware of its
obligations to comply with OSHA standards (as certain industries
are exempt), whether it relates to particular workplace
safety matters, recordkeeping, and the like. For instance,
employers with employees who may be exposed to hazardous
chemicals in the workplace must prepare and implement a
written Hazard Communication Program and comply with other
requirements of the OSHA Hazard Communication Standard.
OSHA also recommends (but does not necessarily require)
that all employers have an Emergency Action Plan that describes
the actions employees should take to ensure their safety
in a fire or other emergency situation. Employers may consider
a Fire Prevention Plan and must comply with OSHA’s
requirements for exit routes in the workplace. Employers
must also provide medical and first aid personnel and supplies
commensurate with the hazards of the workplace and should
review OSHA’s standards for walking/working surfaces
(e.g., floors, aisles, and stairways) to make sure that
such surfaces are maintained in accordance with OSHA standards.
OSHA does maintain a comprehensive website that explains
which industry employers are covered by its regulations,
and sets forth all standards applicable to many particular
industries: www.osha.gov.
For greater clarification of any of these issues, you may
contact any Shawe
Rosenthal attorney.
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