NLRB Condemns Employer's Responses to Non-union Sit-in Strike | Practical Law

NLRB Condemns Employer's Responses to Non-union Sit-in Strike | Practical Law

In Amglo Kemlite Laboratorites, Inc., the National Labor Relations Board (NLRB) held that the employer unlawfully responded to an onsite strike by non-union workers in violation of the National Labor Relations Act (NLRA). The NLRB found that the employer's conduct condoned the non-union strike, making it a protected activity under the NLRA. The employer's later threat to discharge half of the striking workers and its transfer of work to its Mexico facility were unfair labor practices (ULP) in violation of the NLRA.

NLRB Condemns Employer's Responses to Non-union Sit-in Strike

Practical Law Legal Update 5-558-6866 (Approx. 7 pages)

NLRB Condemns Employer's Responses to Non-union Sit-in Strike

by Practical Law Labor & Employment
Published on 25 Feb 2014 • USA (National/Federal)
In Amglo Kemlite Laboratorites, Inc., the National Labor Relations Board (NLRB) held that the employer unlawfully responded to an onsite strike by non-union workers in violation of the National Labor Relations Act (NLRA). The NLRB found that the employer's conduct condoned the non-union strike, making it a protected activity under the NLRA. The employer's later threat to discharge half of the striking workers and its transfer of work to its Mexico facility were unfair labor practices (ULP) in violation of the NLRA.
On February 21, 2014 in Amglo Kemlite Laboratories, Inc., the panel (Board) heading the NLRB's judicial functions held that some of the employer's actions in response to its non-union employees' onsite strike violated the NLRA. The Board held that the employer effectively condoned what might have otherwise been unlawful and unprotected strike activity. Consequently, the Board held that the employer's threat to discharge the striking employees and the transfer of work to another facility each was unlawful retaliation for protected activity. (360 N.L.R.B. slip op. 51 (Feb. 21, 2014)).

Background

The non-union employer operates several facilities around the world, including one in Bensenville, Illinois. On September 20, 2011, nearly all of the employer's production workers at the Bensenville facility ceased work and protested the employer's failure to grant a wage increase for several years in the product assembly area of the facility. An NLRB administrative law judge (ALJ) found that, in response to the strike, the employer's officials:
  • Informed the strikers that the owner was aware of their request for a wage increase.
  • Told the strikers several times that the employer will not raise wages.
  • Offered resignation forms to strikers to use to resign if they did not like their current wages.
  • Threatened that the employer would:
    • discharge half of the strikers because of the strike; and
    • move production work to foreign facilities because of the strike.
  • Left the product assembly area after approximately two hours, while the strikers remained in the product assembly area for an additional four hours, in many circumstances an hour after their shifts would have ended.
  • Invited the workers to return to work several times throughout the seven day strike.
  • Reinstated, without consequence, all but 22 of the strikers who offered unconditionally to return to work.
  • Notified the 22 workers it did not reinstate that their positions were no longer available because the employer had transferred some production work to its facility in Mexico.
  • Placed those 22 employees on a preferential hiring list and promised to recall them before hiring new employees.

Outcome

A three-member Board panel (Chairman Pearce and Members Hirozawa and Johnson, with Member Miscimarra recusing himself) held that the employer violated Section 8(a)(1) of the NLRA when it:
  • Threatened its non-union employees with discharge in retaliation for striking, which became protected activity after the employer's actions condoned it.
  • Transferred work from its Bensenville facility to its Mexico facility in retaliation for the strike.
In particular, the Board concluded that the NLRA protected the strikers, at least until the employer's officials left discussions with the strikers in the protest area two hours into the first day of the strike. Applying the factors in Quietflex Mfg. Co. (344 N.L.R.B. 1055 (2005)) and balancing the employer's private property rights with the non-union strikers' Section 7 right to engage in protected activity on the employer's property, the Board found that:
  • The strikers went on strike to put economic pressure on the employer to increase wages, a reason entitled to the NLRA's protection.
  • The strike was peaceful and short in duration. The Board considered only the first two hours of the strike in the Quietflex analysis, having found the employer condoned any strike activity thereafter.
  • The strike did not interfere with the employer's production or access to the property any more than if the strikers had protested off of the employer's property.
  • The strikers had an adequate opportunity to discuss their demand for a wage increase with management until the employer's officials left the area.
  • The employer did not warn the strikers that they would be fired or disciplined if they refused to leave the facility while refusing to work.
  • The strikers were not represented by a union and had no formal grievance procedure through which they could have made their wage increase demands.
  • None of the strikers' shifts had ended at the time the officials left the protest area. The Board found that the employer condoned the onsite strike activities that followed the first two hours of striking which occurred during their shifts. The Board discounted the fact that most of the strikers continued to protest for their wage demands in the product assembly area of the employer's facility after their shifts ended.
  • The strikers made no attempt to seize the employer's property.
The Board held that the employer condoned the potentially unlawful strike activity occurring after the first two hours of the strike by not disciplining or discharging them, but instead by:
  • Frequently inviting the workers to return to work.
  • Reinstating all but 22 of the workers without consequence.
  • Placing the 22 workers who were not reinstated on a preferential hiring list because it had no jobs available for them.
The majority declined to determine whether the strike activity after the first two hours would have lost the NLRA's protection had the employer not condoned it. In partial dissent, Member Johnson found that the strikers would have lost the protection of the NLRA after the first two hours if the employer had not condoned the strike. In turn, the employer might have been entitled to discharge all of the strikers for engaging in an unlawful sit-in strike had it not condoned their continued onsite strike activity.
Additionally, the Board found that:
  • The ALJ properly concluded that the employer did not discharge any employees because of the strike, but applied the wrong test for deciding the rare question of whether a discharge occurred. The ALJ should have asked whether, from the employees' perspective, the employer's words and conduct would reasonably lead employees to believe that the employer has terminated them (Pride Ambulance Co., 356 N.L.R.B. slip op. 128 (Apr. 5, 2011)). Applying the proper test, the Board found that the employer did not discharge the strikers because its agents' words and conduct on the first day of the strike and after, including inviting and requesting that strikers return to work, could not reasonably have led the strikers to conclude they were fired.
  • The ALJ erred in denying the General Counsel's motion to amend the complaint to add an allegation of an unlawful threat of discharge because:
    • Section 10(b) of the NLRA expressly provides for amendments to complaints before the NLRB issues an order; and
    • the amendment would have modified an existing threat of reprisal allegation.
  • It could rule on the unpled threat of discharge allegation because the allegation was fully litigated. Under Board precedent, enforced by the US Court of Appeals for the District of Columbia Circuit, where a respondent in NLRB proceedings fails to object to evidence supporting an unpled allegation and fails to solicit testimony during cross-examination or its own case to refute that evidence, the allegation is fully litigated (Casino Ready Mix, Inc., 335 N.L.R.B. 463 (2001), enforced 321 F.3d 1190 (D.C. Cir. 2003)).
  • The statements by the employer's official that the owner would direct her and the president to get rid of half of the strikers because of the strike supported the unpled threat of discharge allegation.
  • Applying Wright Line, the employer's transfer of production work from the Bensenville facility to the Mexico facility violated Section 8(a)(1) of the NLRA because:
    • the employer was aware of the strike;
    • the employer's conduct condoned the strike and therefore rendered it a protected activity under the NLRA;
    • the employer showed animus towards the strike by threatening to transfer work and threatening strikers with discharge;
    • the employer failed to show it would have transferred the work for lawful reasons; and
    • the employer failed to show, contrary to its assertion, that it only transferred an insignificant amount of work to the Mexico facility. The employer eliminated 22 positions which comprised 25 percent of its Bensenville workforce before the strike.
    (662 F.2d 899 (1st Cir. 1981).)
  • Additionally, there was direct evidence of the employer's unlawful motivation, specifically:
    • the employer's official's response to strikers, when asked about reinstatement, that the employer was moving production to Mexico because of the strike;
    • the employer's official's statement to the Board that the strike accelerated the employer's decision to move production to Mexico; and
    • the suspicious timing of the transfer, which occurred soon after the strike.
  • Textile Workers Union of America v. Darlington Manufacturing Company, which permits an employer under the NLRA to terminate its business for any reason, was inapposite (380 U.S. 263 (1965)).
  • The employer permanently transferred, and therefore eliminated some of the struck production work at Bensenville during and after the strike in retaliation for the strike. It did not simply transfer the work temporarily to continue operations during the strike, which the Board acknowledged would have been lawful.
Accordingly, the Board ordered the employer to:
  • Cease and desist from unlawfully threatening strikers with discharge.
  • Restore the production work it transferred to the Mexico facility back to the Bensenville facility.
  • Offer full reinstatement to strikers who lost their jobs due to the unlawful transfer of work.
  • Make whole each striker who suffered lost wages or benefits due to the unlawful transfer of work.
  • Show that it would have subsequently laid off strikers for legitimate reasons to reduce its liability in NLRB compliance proceedings.
  • Expunge from strikers' files any reference to a loss of employment caused by the unlawful transfer of work.

Practical Implications

This decision provides guidance for non-union employers facing onsite strike activity. These employers should understand that their actions may condone what otherwise would be an unlawful sit-in strike and effectively extend the NLRA's protections to employees they could have otherwise lawfully discharged.
In light of this case's interpretation and application of the Quietflex factors, these employers should consider:
  • Implementing and publicizing company-run grievance procedures, so that employees:
    • have formal options to raise concerns about their employment terms and conditions without arguably having rights to engage in onsite strikes; and
    • understand that they may be subject to discipline for remaining on the employer's premises while refusing to work rather than following the grievance procedures.
  • Clearly informing employees that engage in an onsite strike that:
    • they must follow the grievance procedures; and
    • that if they continue to refuse to work, they must leave employer's premises or else they may face discipline and criminal trespass charges.
  • Observing and documenting for evidentiary purposes:
    • how the strike impacted production and the employer's access to its property;
    • whether strikers damaged employer's equipment;
    • whether the strikers stayed on the employer's property beyond their scheduled shifts; and
    • whether the strike interfered with management and non-striking workers' abilities to perform their normal business functions.
All employers should note that the Board will readily consider unpled allegations fully litigated and rule on them, even when an ALJ does not. According to rarely tested Board precedent, an ALJ's decision not to permit an amendment to an ULP complaint at trial does not bar the Board from considering the unpled allegation based on the counsel for the NLRB's General Counsel's exceptions to the ALJ's decision and recommended order. Employers should consider:
  • Objecting to evidence that the counsel for the NLRB's General Counsel introduces at the ALJ trial in support of unpled ULP allegations.
  • Soliciting testimony during cross-examination and its own case to refute that evidence.
Update: On August 17, 2016, in Amglo Kemlite Laboratories, Inc., v. National Labor Relations Board, the United States Court of Appeals for the Seventh Circuit enforced the Board's remedial order because it had a reasonable basis in law and was supported by substantial evidence ( (7th Cir. Aug. 17, 2016).