UPDATE: The new rule published in the Federal Register on December 18, 2019 was to take effect on April 16, 2020, but that effective date has been moved back to June 1. 2020 by the NLRB.
Seyfarth Synopsis: On December 13, 2019, the National Labor Relations Board ("Board") announced the final rule amending the procedures used for elections to determine whether employees desire to be represented by a labor union. The new election rules are intended to make the process more fair and respond to significant criticism of the rules adopted by the Obama Board in 2014. The Obama Board's so-called "quickie election" rules were heavily criticized for a number of things, including depriving the parties of due process and moving elections along so quickly that employees never had an opportunity to hear both sides.
The new rule announced last week presents a more balanced process, while ensuring that petitions are processed efficiently. The final rule will be published in the Federal Register on December 18, 2019 and will take effect 120 days thereafter. The highlights of the new rule are summarized below:
Statements of Position and Timing of Pre-Election Hearing
Under the old rule, employers have little time to evaluate and respond to a petition for an election filed by a union. The Board required the employer to file a comprehensive Statement of Position within seven calendar days of being notified of a petition and scheduled a hearing eight calendar days after the notification. In response to concerns that this timeline deprived the employer of adequate time to determine the issues, file the Statement of Position and prepare for the hearing, the new rule provides for the Statement of Position to be filed eight business days after the region issues a notice of hearing and for the hearing to be scheduled 14 business days from the notice. The new rule also provides that these dates may be extended for good cause.
The old rules state that any issue not raised in the Statement of Position is waived. In an effort to make the process more fair, under the new rule, either party can amend its Statement of Position upon a showing of good cause. Further, under the new rule, the petitioning party will be required to file a written response to a Statement of Position, as opposed to an oral response at the hearing, as required under the old rules. This will allow for greater transparency as to what is disputed and will be litigated at the hearing.
Scope of Pre-Election Hearing
The scope of the pre-election hearing will change under the final rule. Under the old "quickie election" rules, disputes concerning voter eligibility, such as whether individuals are statutory supervisors, do not have to be litigated prior to an election. This approach has created significant confusion for employees, employers and unions, as it is often unclear whether certain employees are included in the unit and eligible to vote. The final rule eliminates these issues by providing that they will now be litigated in the pre-election hearing and resolved prior to the election, unless the parties agree to have disputed individuals vote subject to challenge.
Under the old rules, parties are permitted to file post-hearing briefs only if they receive permission from the Regional Director. The new rule restores the pre-2014 process that allowed parties to file briefs as a matter of right. This will give all parties a greater opportunity to focus their legal arguments based upon the factual record developed at the pre-election hearing.
Timing of Election and Voter List
Under the old quickie election rules, an election was scheduled "for the earliest date practicable," determined on a case-by-case basis. While still requiring that an election be scheduled as soon as practicable, the final rule instructs that an election should be scheduled no less than 20 business days from the direction of an election. This will ensure that there is adequate time for employees, employers and unions to express their views during the election campaign. Further, an employer will have five business days from the direction of an election (as opposed to the current two calendar days) to serve the voter list on the union and the region.
Request for Review
The final rule also changes the process by which a party can request Board review of a decision of a Regional Director. If a request for review has been filed within ten business days of the direction of election and the Board has neither granted the request nor ruled upon it, the election will occur as directed, but ballots will be impounded and not opened until action by the Board. A request for review filed more than ten days after the direction of election will not require impoundment of the ballots. Parties can also file requests for review after an election.
Board Member Lauren McFerran issued a 100 page dissenting opinion to the final rule, calling the majority's actions "arbitrary and capricious—a textbook example of how administrative agencies should not proceed." She characterized the old rule as "the product of a painstaking, three-and-a-half year process, involving the consideration of tens of thousands of public comments generated over two separate comment periods totaling 141 days, including 4 days of hearings with live questioning by Board Members." In comparison, she wrote, the new rule was drafted and issued without sufficient notice to or comment from the public.
Member McFerran also complained about the additional time built into the new procedures, explaining that "[u]nder the new rule, the minimum total number of days from the filing of an election petition to certification of a union in a case that is contested both pre- and post-election will rise from 23 days (under the 2014 rule) to 78 days."
While the above represents a summary of the most significant changes, and despite Member McFerran's dissent, the final rule is intended to reverse the most controversial aspects of the 2014 rule. Employers have struggled to comply with the procedural requirements of the old rules. Further, employers had little time to educate employees about the potential downsides of unionization. Similarly, employees had little time to share their views on unionization with their co-employees. The new rule is designed to, and should, eliminate these and other problems.
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