Surveillance in the Workplace

OK for Employer, not Employee?

Whole Foods Market, Inc., the world’s largest retailer of natural and organic foods, has prevailed in a union  battle to overturn a store policy that prohibits employees from recording conversations.

Steven Davis, an administrative law judge for the National Labor Relations Board (NLRB), recently issued a decision dismissing a complaint filed against the store by  the United Food and Commercial Workers, Local 919, and Workers Organizing Committee of Chicago.

The union argued that the policy prevents workers from recording conversations related to protected activities, including allegedly unlawful statements made by supervisors.  Also, the union noted that recordings are valuable evidence in administrative or judicial forums in employment related matters.

“I agree,” wrote Judge Davis in his opinion, “ but the employee may present his contemporaneous, verbatim, written record of his conversation with the other party, and his own testimony concerning employment-related matters. Only electronic recordings of conversations is prohibited.”

Ironically, the policy in question also states that “many Whole Foods Market locations may have security or surveillance cameras operating in areas where company meetings or conversations are taking place, their purposes are to protect our customers and Team Members and to discourage theft and robbery.”

Judge Davis said the presence of company surveillance cameras does not make the policy unlawful because employees are advised of the presence of the cameras and the cameras address a legitimate business concern – to protect customers and employees and discourage theft.

The complaint alleged the policy violates Section 8(a)(1) of the National Labor Relations Act, which makes it illegal for an employer “to interfere with, restrain, or coerce employees” in the exercise of their rights to organize collectively.

Whole Foods maintained the purpose of the policy is “to eliminate a chilling effect to the expression of views that may exist when one person is concerned that his or her conversation with another is being secretly recorded. This concern can inhibit spontaneous and honest dialogue especially when sensitive or confidential matters are being discussed.”  A violation of the policy, which applies to tape recorders, cell phones and any electronic device, results in “corrective action, up to and including discharge.”

Marc Ehrnstein, the global vice president for Whole Food’s team member services,  said the policy applies to employees during working time – not their break time – and extends to all areas of the store including the parking lot and the area in front of the store. He said an employee’s recording of picketing in front of the store would be a violation of the rule.

Ehrnstein testified at a hearing last summer that Whole Food’s “core values” and “culture” encourage employees  to “speak up and speak out” on many issues. For example, he said each store has a “town hall” meeting once a year where employees meet with regional management leadership without store management being present.  Ehrnstein said  workers would be reluctant to voice their opinions about store management if they knew that their comments were being recorded.

Whole Foods, which operates 351 stores and employs 76,000 workers, adopted the policy in 2001.

Federal Courts Disregard Longstanding Worker Rights

Workers continue to lose ground in federal courts, where judges are disregarding a ruling by the National Labor Relations Board (NLRB) that says companies cannot require workers to sign away their right to bring class action arbitrations and lawsuits.

 The NLRB’s  administrative decision in January  served as a theoretical  counterpoint to an earlier 5-to-4  decision by the U.S. Supreme Court in AT&T Mobility v. Concepcion.

 The Concepcion case involved alleged false advertising by AT&T and a $30 claim by a California plaintiff, who sought to prosecute the case as  class  arbitration . As the  dissent noted in Concepcion: “What rational lawyer would have signed on to represent the Concepcions in litigation for the possibility of fees stemming from a $30.22 claim?”

 The Supreme Court majority held that the Federal Arbitration Act of 1925 preempts state laws that prohibit contracts from disallowing class action lawsuits  – which means that contracts can exclude class action arbitration. 

 The NLRB ruling involved national homebuilder D.R. Horton’s practice, begun in 2006, of forcing all employees to agree as a condition of employment, not to pursue class or collective litigation of claims in any forum –  arbitral or judicial.  In its ruling, the NLRB said it has long held –  “with uniform judicial approval” –  that the National Labor Relations Act “protects employees’ ability to join together to pursue workplace grievances, including through litigation.”  

According to Thompson Reuters’ journalist Nate Raymond,  courts generally are rejecting the NLRB decision, some on the grounds that the  Federal Arbitration Act controls, and others cite the Supreme Court’s Concepcion decision. For example, in recent months:

  •  U.S. District Judge Gene Pratter in Philadelphia agreed with Tenet Healthcare and confirmed an arbitrator’s finding that a nurse could not bring classwide wage-and-hour claims in arbitration. The nurse’s lawyer had cited D.R. Horton in arguing that the arbitrator had erred.
  •  U.S. District Judge D.P. Marhsall in Little Rock, Arkansas, on Aug. 1, 2012 concluded that the FAA trumped the NLRA. and compelled individual arbitration in a putative class action of guards suing Securitas Services Inc.   Marshall said that accepting the NLRB’s reasoning would mean favoring litigation over arbitration, in contrast to the federal policy of favoring arbitration.
  •  Employees at Waffle House Inc. cited D.R. Horton in an effort to convince U.S. District JudgeCarlos Murguia of Kansas City, Kansas, to not compel individual arbitration. They lost. “Although Concepcion may not speak directly to the issue before the court,” the judge wrote, “it does illustrate a guiding principle: arbitration agreements are enforceable even when they prohibit the use of a class action.”

 Thomas Reuter News Service reports that  judges in New York, California, Pennsylvania, Florida and Georgia have refused to allow employee class actions to move forward on the basis of the NLRB’s holding, in cases against Jenny Craig, Citigroup, P.F. Chang’s and UBS, among others.

The Concepcion decision likely will have a devestating impact upon workers who are cheated by unscrupulous employers out of overtime pay or hourly wages.

“Class claims frequently offer the only vehicle for consumers or employees to challenge unlawful actions that cause limited damages to each individual while often reaping millions for business,” law professor Ann C. Hodges writes in an American Constitutional Society blog analysis of D.R. Horton. “… In the workplace, Fair Labor Standards Act cases seeking minimum wage or overtime payments are most likely to be abandoned on this basis and Horton involved such a claim, alleging that the nonunion employer misclassified employees as exempt from overtime pay.”

The Progressive States Network (PSN) in a recent report entitled, Where Theft is Legal: Mapping Wage Theft Laws in the 50 States, estimates that more than 60 percent of low-wage workers suffer wage violations each week. On average, the PSN reports, low-wage workers lose $51 per week to wage theft, or $2,634 per year. For low-wage workers, that amounts to 15% of their annual income, at average earnings of $17,616 per year.

Federal judges are appointed for life (in good behavior) and earn annual salaries of $174,000..

* See earlier reporting by this blog on federal court judges’ hostility to employment discrmination lawsuits.

Business Opposes the NLRB ‘Poster Rule’

What They Don’t Want You to Know …

A melodrama is being played out in federal court about whether American workers should be informed of rights that they have possessed for 70 years under the National Labor Relations Act (NLRA).

Most workers think the NLRA pertains only to union organizing but it provides most workers the right to join together to improve their wages and working conditions with or without a union. The NLRA can come into play, for example, when an employer fires a non-union employee(s) for discussing a safety concern or other concerns about working conditions.

Employers are spending millions to prevent workers from knowing their rights!

The National Labor Relations Board (NLRB) issued a rule last summer that would have required most private sector employers to post a notice on Nov. 14, 2011 informing all workers of their rights under the NLRA.  This is called the NLRB “Poster Rule.” There was an immediate outcry from business groups, including the U.S. Chamber of Commerce, the National Association of Manufacturers and Associated Builders and Contractors (all of which filed lawsuits to block the rule).

Twice delayed, the rule was scheduled to go into effect on April 30, 2012. That’s not going to happen now because of recent federal court rulings in multiple lawsuits. Here are the legal developments:

  • The  U.S. Court of Appeals for the District of Columbia Circuit  in Washington, D.C., on April 17, 2012 issued a temporary injunction prohibiting implementation of the rule, pending appeal.
  • U.S. District Judge David Norton of South Carolina ruled on April 13, 2012 that the labor board went beyond its legal authority when issuing the rule.
  • U.S. District Judge Amy Berman Jackson of Washington, D.C., on March 2, 2012 ruled that the NLRB had the authority to adopt the poster rule, though she said the NLRB exceeded its authority with respect to certain penalty penalties for failing to comply with the rule.

The NLRB says the notice is needed because “many employees protected by the NLRA are unaware of their rights under the statute.”   Requiring employers to post the notice would, according to the NLRB, “increase knowledge of the NLRA among employees, in order to better enable the exercise of rights under the statute.”

Most union workers are aware that the NLRA protects their right to organize but non-union workers may have no idea that the NLRA also protects them,  whether they want to join a union or not. Section 7 of the NLRA guarantees employees the right to engage in “concerted activities” not only for self-organization but also “for the purpose of . . . mutual aid or protection. . . .”

The broad protection of Section 7 applies with particular force to unorganized employees who, because they have no designated bargaining representative, must “speak for themselves as best they [can].”  NLRB v. Washington Aluminum Co., 370 U.S. 9, 14, 82 S.Ct. 1099, 8 L.Ed.2d 298 (1962).

At this point, it is anyone’s guess whether  the NLRA posters will ever see the fluorescent light of break rooms in businesses and factories around the country.  I suggest workers print out this article or an equivalent and (anonymously) post it on their employee bulletin board.

When is a threat … a threat?

August 4, 2011 – It is ever okay to issue a threat of any kind in the workplace?

Suppose a worker says he’s going to “fight” for his rights?

A case in Missouri demonstrates complexities of this issue.  What is a threat? Do intent and the context in which the threat is made matter?   Yes, say the National Labor Relations Board (NLRB) and the U.S. Court of Appeals, District of Columbia Circuit, Washington, DC.

Here’s the background:

Management at Kiewit Power Construction Co. voluntarily permitted electricians to take 15-minute breaks in the morning and afternoon. As the electricians began working farther away from the trailer containing the break room, they left the worksite earlier and the breaks were taking longer. The company, worried about lost productivity, said the electricians could no longer go to the break room, and provided a table and chairs so they could break where they were working.  The union objected and electricians resisted. The company began issuing warnings.

When a supervisor approached a group of electricians and said he was going to write them up, two electricians mouthed off.

One told the  supervisor he had “been out of work for a year,” and that if he got “laid off it’s going to get ugly.” He also said the supervisor “ better bring [his] boxing gloves.”

 The second electrician told the supervisor he had recently been out of work for eight months and repeated the other electrician’s comment that “it’s going to get ugly.”

Both were fired, and their union, the International Brotherhood of Electrical Workers, declined to pursue a grievance..

After an Administrative Law Judge upheld the dismissals, one of the electricians appealed to the National Labor Relations Board, which reinstated both workers, finding that in context their statements were not physical threats but merely figures of speech made in the course of a protected labor dispute. Kiewit Power appealed to the U.S. Court of Appeals, District of Columbia Circuit.

In a split 2-1 decision,  the appeals court on 8/3/11 sided with the NLRB and the electricians.

The majority agreed that a worker could be fired if he or she made a physical threat. They said the employee’s remarks were “intemperate” remarks rather than actual threats.  Also, the  Court reasoned the employer provoked the electricians by picking a public scene that was likely to lead to a quarrel, and that it was reasonable for the employees to respond “briefly, spontaneously, and verbally” to the disciplinary measure.  Importantly, they said,  the electricians did not demonstrate any physically threatening behaviors.

The majority said: “To state the obvious, no one thought that  the electricians were literally challenging their supervisor to a boxing match. Once we acknowledge that the employees were speaking in metaphor, the NLRB’s interpretation is not unreasonable. It is not at all uncommon to speak of verbal sparring, knock-down arguments, shots below the belt, taking the gloves off, or to use other pugilistic argot without meaning actual fisticuffs. What these words stand for, of course, is a matter of context.”

To illustrate a  real physical threat,  the majority compared a hockey player dropping gloves to battle another hockey play to Presidential candidate Sarah Palin promising “the gloves are coming off” in the 2008 election.

The majority said the employer’s “subjective perception of an employee’s statement” is not dispositive about what constitutes a threat,  and that it was appropriate for the NLRB to use an “objective standard” consistent with prior decisions.   Furthermore, the majority said it would defeat the ability of workers to unionize “if workers could be lawfully discharged every time they threatened to ‘fight’ for better working conditions.”

The dissent contended the electricians did threaten the management representative and that there was no reasoned basis for the majority’s overturning the original decision of the Administrative Law Judge. “Phrases like “workplace violence” and “going postal” manifest that today’s work setting is often far from calm, especially in precarious economic times … The  Board’s reinstatement—seconded by my colleagues—of employees who openly challenge by threatening language lawful decisions of their employer compels me to observe: ‘So much for industrial peace.’”

The bottom line is that the electricians got lucky!   Almost certainly, an employee who works for a non-union employer, even if provoked, would likely have faced a far different outcome.