The National Labor Relations Board (NLRB or Board) is often criticized on two fronts. First, as one of us described decades ago, is the Board’s penchant to engage in “policy oscillation,” whereby the agency makes repeated 180-degree turns in dealing with certain polices depending on the political party then in the White House. Second is the Board’s lethargic response to changes in workplace realities, earning it the moniker of “the Rip Van Winkle of administrative agencies” by the Seventh Circuit. In its recent decision on employee use of employer-provided email to discuss union issues, the Board unfortunately has stayed true to form.
In Caesars Entertainment, 368 NLRB No. 143 (2019), the Trump Board voted 3-1 to overrule the Obama Board’s 2014 (3-2) decision un Purple Communications, 361 NLRB No. 126 (2014), which in turn had overruled the Bush Board’s 2007 (3-2) decision in Register Guard, 351 NLRB No. 70 (2007). This may be no way to run a railroad but it is how this agency does business.
For a five-year period since Purple Communications, employees could make reasonable use of their company’s email system to communicate with fellow workers on union and other organizational matters without fear of employer discipline or undue restriction. Such access was presumed protected by Section 7 of the National Labor Relations Act, a 1935 law administered by the Board. The presumption could be overcome by an employer showing of special circumstances implicating a legitimate interest in safety, production, or discipline.
The basic reasoning behind Purple Communications was that, as the Supreme Court long ago recognized in Republic Aviation Corp. v. NLRB, 324 U.S. 793 (1945), employees’ Section 7 right to engage in concerted activities in support of union organization and self-organization includes a right to be able to discuss their wages, working conditions, and interest in collective organization with coworkers at the employer’s premises. Such solicitation could occur in work and nonwork areas but only during nonwork time; if distribution of literature was involved, it could be restricted to nonwork areas. The right of access thus extended to the cafeteria, water cooler, break rooms, and other nonwork areas and could not be restricted by the employer absent special circumstances.
What Purple Communications did was to extend this presumption of access to the company’s email system. The email system was likened to the water cooler or break room, not to employer-provided equipment like telephones and Xerox machines where the Board generally has ruled access could be denied to employees engaged in union solicitation. Union access to such equipment would entail additional costs to the employer, who was not required by law to subsidize union activity.
Now, the Board has flipped that presumption and reverted to the 2007 Register Guard approach, barring employee access to email for Section 7 communications, “except in those rare cases where an employer’s email system furnishes the only reasonable means for employees to communicate with one another.” To arrive at this holding, the Board departs from longstanding interpretations of controlling Supreme Court precedent.
Consider the current Board’s treatment of Republic Aviation which the agency insists “stands for the twin propositions that employees must have adequate avenues of communication in order to meaningfully exercise their Section 7 rights and that employer property rights must yield to employees’ Section 7 rights when necessary to avoid creating an unreasonable impediment to the exercise of the right to self-organization.”
But that is not quite right. Indeed, in Eastex, Inc. v. NLRB, 437 U.S. 556 (1978), the Supreme Court expressly disavowed the idea that Republic Aviation stood for some sort of effective or adequate alternatives test:
In Republic Aviation the Court upheld the Board’s ruling that an employer may not prohibit its employees from distributing union organizational literature in nonworking areas of its industrial property during nonworking time, absent a showing by the employer that a ban is necessary to maintain plant discipline or production. This ruling obtained even though the employees had not shown that distribution [off] the employer’s property would be ineffective. [Emphasis added.]
Further, the Supreme Court in Eastex expressly rejected an argument strikingly similar to the one adopted by the Board in Caesars Entertainment—namely, that Section 7 communications taking place on company property “would be an unnecessary intrusion on employer’s property rights in the absence of a showing by employees that no alternative channels of communication with fellow employees are available.” Eastex, however, is not about property rights. Indeed, the Court found that “[Eastex’s] reliance on its property right is largely misplaced,” precisely because, per Republic Aviation, the “employees are already rightfully on the employers’ property, so that . . . it is the employer’s management interests rather than its property interests that primarily are implicated.”
This difference –between an employer’s property rights against nonemployees versus its more limited management interests in regard to employees rightfully on company property—is the “difference of substance” established by the Court in a number of rulings in addition to Eastex, including Hudgens v. NLRB, 424 U.S. 507 (1976); Central Hardware Co. v NLRB, 407 U.S. 539 (1972); Beth Israel Hosp. v. NLRB, 437 U.S. 483 (1978). It is this difference that requires an employer to show that its management interests have been impeded to justify a rule restricting employees’ Section 7 communications, whereas in the case of union or other nonemployee access, the union must show that no other reasonable avenues of communication with employees exist. In Caesars Entertainment, the Board essentially dissolves this difference.
The Board attempts, in the final analysis, to distinguish email communications from on-site communications between employees plainly protected by Republic Aviation on the ground that the latter involve “face-to-face Section 7 activity within a physical workplace.” This is a distinction without meaning and without support in the Supreme Court decisions, as it ignores distribution of organization literature (the very subject of the Eastex ruling) and the wearing of union buttons and other insignia (the very subject of Republic Aviation). The fact that face-to-face communications may not be occurring does not, standing alone, present “special circumstances” implicating interests in discipline or production that might justify a broader ban.
Employee use of email can be abused. No evidence, however, of unworkability or union abuse under prior Board law was presented in Caesars Entertainment. Rather, the Board states flatly that email is not “an indispensable tool for communications.” This is beside the point because under Republic Aviation and its progeny, employees do not have to show that access to the cafeteria or break room or email is “indispensable.” Such access would plainly be useful for employee communications and could not be barred absent “special circumstances” not shown by the employer in this case.
The Board’s decision in Caesars Entertainment is concerning for reasons besides its failure to adhere to controlling Supreme Court precedent. It is yet another example of a retroactive policy reversal effected through Board adjudication. Whether one views the Caesars Entertainment decision favorably or not, it will almost certainly be temporary–reversed, again, when there is a change in party in the White House.
The Board’s use of adjudication to announce new rules, and reverse old ones, has led to instability in the law and a lack of respect for the Board’s decisions in the nation’s courts. For Judge Friendly, in his time the country’s leading judicial voice on administrative law, one partial solution was to require rulemaking where the Board seeks to announce a policy reversal, especially where reliance interests are significant. Yet, while rulemaking may better protect reliance interests, here we have the opposite problem. With so few years between Board reversals, no one—employers and employees alike—can reasonably rely on a Board ruling dealing with email access.
Case in point: the initial Caesars Entertainment complaint was first adjudicated under the Register Guard standard in 2012, then remanded by the Board under the Purple Communications standard in 2015, before becoming the vehicle for another Board policy reversal in Caesars Entertainment in 2019. For the earning potential of labor lawyers, this is a blessing; for the administration of labor law, it is dysfunction.
Though rulemaking in the case of policy reversals cannot be required of the NLRB without statutory change, Judge Friendly’s concerns for the stability and legitimacy of labor law through considered policymaking remain valid. Going forward, the Board would be well-advised to use rulemaking as the exclusive vehicle for the Board to accomplish policy reversals and to do so only when experience truly shows there is a need to change course.
An abridged version of this article first appeared in Bloomberg Law’s Daily Labor Report on February 12, 2020.
