TREATING NONEMPLOYEES DIFFERENTLY UNDER ACCESS POLICIES AND SECTION 8(a)(1) THE NLRA IS NOT, AND SHOULD NOT BECOME, AN ANTIDISCRIMINATION STATUTE

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1 TREATING NONEMPLOYEES DIFFERENTLY UNDER ACCESS POLICIES AND SECTION 8(a)(1) THE NLRA IS NOT, AND SHOULD NOT BECOME, AN ANTIDISCRIMINATION STATUTE Thomas B. Buescher Buescher, Goldhammer, Kelman & Perera, P.C. INTRODUCTION The issues surrounding nonemployee access to private property in order to engage in activities protected by Section 7 are legion. The question posed for this paper focuses on only one of those issues the proper test to determine whether there has been discriminatory application of a rule or policy used to prohibit access for Section 7 purposes. After discussing this topic, this paper addresses the fact that Board law currently applies a different test for discrimination when the conduct is engaged in by employees using employer-owned equipment or processes from that applied to nonemployee trespassers. This paper concludes that the current test for discrimination in Sandusky Mall is correct, thus leaving this distinction intact. It ends with a recommendation that the test for discrimination for conduct by employees be changed, but not that Roundy's is not the case to do so. THE CURRENT STATUS OF ROUNDY S, INC. The facts in Roundy s are fairly straightforward. The Milwaukee Building and Construction Trades Council (MBCTC) engaged in handbilling in front of various retail entities operated by Roundy s, asking customers to boycott those entities since the construction was done, in part, by contractors failing to pay prevailing wages. The Board held that Roundy s did not establish an exclusionary property interest in 23 of the 25 locations where the handbilling took place and thus violated Section 8(a)(1). 356 NLRB No. 27 (2010). With respect to the remaining two locations, the ALJ found that Roundy s did have a sufficient property interest, but concluded that it nonetheless violated Section 8(a)(1) because it discriminatorily applied its no solicitation rule to this handbilling. Instead of ruling on this finding when the decision came back to it, the Board decided to use the case to consider the appropriate test for discriminatory 1

2 application of such rules to nonemployees. Specifically, the Board asked the parties and any amicus to discuss the following: 1. In cases alleging unlawful employer discrimination in nonemployee access, should the Board continue to apply the standard articulated by the Board majority in Sandusky Mall Co., above [329 NLRB 618, 623 (1999), enf. denied 242 F.3d 682 (6th Cir. 2001)]? 2. If not, what standard should the Board adopt to define discrimination in this context? 3. What bearing, if any, does Register Guard, 351 NLRB 1110 (2007), enf. denied in part 571 F.3d 53 (D.C. Cir. 2009), have on the Board s standard for finding unlawful discrimination in nonemployee access cases? THE SANDUSKY MALL TEST In 1999 the Board rearticulated the standard it would use to determine whether there was discrimination in the application of a no-solicitation rule to nonemployees. It wrote: [A]n employer's practice of reviewing and evaluating each message sought to be disseminated, and granting access only if in its judgment the solicitation [does] not adversely affect the employer's business, [is] unlawfully discriminatory vis-avis union solicitation of customers. Similarly, in the instant case, we find the Respondent's policy of permitting access based on its discretion and business judgment is unlawfully discriminatory vis-a-vis union solicitation of customers. The Respondent prohibits the dissemination of a message protected by the Act while at the same time permitting the dissemination of a wide range of other messages. In prohibiting the Union's protected area standards handbilling, the Respondent is distinguishing among solicitation based on its own assessment of the message to be conveyed according to its purely subjective standard. This practice "amounts to little more than an employer permitting on its property solicitation that it likes and forbidding solicitation that it dislikes." As the D.C. Circuit has observed, "to allow such a subjective criterion to govern access would eviscerate Section 8(a)(1)'s purpose of preventing discriminatory treatment of unions by employers who permit other nonemployee entities to solicit on the employer's property." 329 NLRB 618, (1999) [footnotes omitted]. The Sixth Circuit denied enforcement. Sandusky Mall Co. v. NLRB 242 F.3d 682 (6th Cir. 2001). In doing so, it reiterated the test for discrimination that it adopted in Cleveland Real Estate Partners v. NLRB, 95 F.3d 457, (6th Cir. 1996). Babcock and its progeny, which weigh heavily in favor of private property rights, indicate that the Court could not have meant to give the word "discrimination" the import the Board has chosen to give to it. To discriminate in the enforcement of a 2

3 no-solicitation policy cannot mean that an employer commits an unfair labor practice if it allows the Girl Scouts to sell cookies, but is shielded from the effect of the Act if it prohibits them from doing so. Cf. Guardian Indus. Corp. v. NLRB, 49 F.3d 317, (7th Cir. 1995). Although the Court has never clarified the meaning of the term, and we have found no published court of appeals cases addressing the significance of "discrimination" in this context, we hold that the term "discrimination" as used in Babcock means favoring one union over another, or allowing employer-related information while barring similar unionrelated information. The Seventh and Fourth Circuits had also rejected the test applied in Sandusky Mall. Guardian Indus. Corp. v. NLRB, 49 F.3d 317, (7th Cir. 1995)(comparing the nature of the notices being posted on a bulletin board to determine discrimination); Riesbeck Food Mkts. Inc. v. NLRB, 91 F.3d 132 (4th Cir. 1996)(comparing the motivation behind the exclusion versus the motivation behind the permitted intrusion by nonemployees). The D.C. Circuit s standard, though, is the same as the Board s in Sandusky Mall. Lucille Salter Packard Children s Hospital v. NLRB, 97 F.3d 583 (1996). The question the Board has posed in soliciting briefs in Roundy s, then, is whether to continue with the Sandusky Mall/ Lucille Salter Packard discrimination test or to adopt some different test. THE PROPER TEST Some Fundamentals Any proper analysis of this issue has to start from some basic principles. First, Section 8(a)(1) is not an antidiscrimination statute. A violation of 8(a)(1) alone therefore presupposes an act which is unlawful even absent a discriminatory motive. Textile Workers Union v. Darlington Mfg. Co., 380 U.S. 263, 269 (1965). It is not a disparate treatment statute either. Instead, it is a statute that often requires an employer to treat union activity more favorably than similar, but unprotected, conduct. Rebecca Hanner White, MODERN DISCRIMINATION THEORY AND THE NATIONAL LABOR RELATIONS ACT, 39 Wm. & Mary L. Rev. 99, 121 (Oct. 1997). 1 An antiunion motive is not necessary to find a violation of this section. NLRB v. Burnup & Sims, Inc., 379 U.S. 21, 23 (1964). 1 The analysis and conclusion in this paper were heavily influenced by this article. 3

4 Moving directly to the issue involved in Roundy's, the Supreme Court established the law over 55 years ago. "Organization rights are granted to workers by the same authority, the National Government, that preserves property rights. Accommodation between the two must be obtained with as little destruction of one as is consistent with the maintenance of the other." NLRB v. Babcock & Wilcox Co., 351 U.S. 105, 112 (1956). Babcock & Wilcox arose in a different factual context from Roundy s: It was decided in the context of union organizers seeking access to an employer's property in an effort to organize the employer's workers while Roundy's involves a construction union trying to pressure Roundy's, through entirely lawful means, to use union contractors in the construction of its stores. The MBCTC's actions fall within the protective scope of the Act. The fact that it was not trying to organize the employees of Roundy's is without any legal significance. The courts, and even sometimes the Board, often appear to forget the fundamental purpose of the NLRA. Going back to Section 1 of the Act reminds us of that purpose and of some fundamental truths in employment relationships. The inequality of bargaining power between employees who do not possess full freedom of association or actual liberty of contract and employers who are organized in the corporate or other forms of ownership association substantially burdens and affects the flow of commerce, and tends to aggravate recurrent business depressions, by depressing wage rates and the purchasing power of wage earners in industry and by preventing the stabilization of competitive wage rates and working conditions within and between industries. ******** It is declared to be the policy of the United States to eliminate the causes of certain substantial obstructions to the free flow of commerce and to mitigate and eliminate these obstructions when they have occurred by encouraging the practice and procedure of collective bargaining and by protecting the exercise by workers of full freedom of association, selforganization, and designation of representatives of their own choosing, for the purpose of negotiating the terms and conditions of their employment or other mutual aid or protection. [Emphasis added.] Section 7 then reiterates the importance of collective bargaining by stating the following: "Employees shall have the right.... to bargain collectively through representatives of their own choosing, and to engage in other concerted 4

5 activities for the purpose of collective bargaining or other mutual aid or protection...." [Emphasis added.] Applying These Fundamentals Anyone who has ever represented a construction company or union of construction workers knows this simple truth--the level of wages and benefits is greatly affected by the market share that unionized employers have in any given market. As a general rule, the greater the unionized market share, the higher the wages and benefits. 2 There are basically two ways to increase market share: Organize employees of the companies or, in the construction industry, convince general contractors and entities like Roundy's to use union contractors. Convincing entities to use union contractors is within the concept of "other concerted activities" and "mutual aid and protection." ("Whether the handbill is considered a form of consumer information handbilling... consumer boycott handbilling, or even a 'less-favored' form of secondary handbilling, it is clearly protected under [Section 7] of the Act." Glendale Associates, Ltd., 335 NLRB 27, n.5 (2001)) Consumer boycotts are just one mechanism for attempting to increase market share and bargaining power so as to attempt to get to bargaining power equality. The intimations by some courts that these activities are not entitled to the same level of Section 7 protection ignore the stated policies of the Act, the economic realities of the market and the definition of employee in the Act. 3 What is the property right against which this Section 7 right is balanced? The fundamental property right is to exclude anyone from access to the property. While that may have been an almost absolute right when the country was founded, it no longer holds that status. This country is long past allowing a business property owner, particularly one that caters to the public like Roundy s, to exclude persons for any number of reasons. Title VII and the ADA have taken care of that: It is no longer acceptable to exclude persons because of their race, national origin, disability or gender even if the business owner believes that such exclusions are beneficial to her business. 2 Belman, Dale and Paula Voos "Union Wages and Union Decline: Evidence from the Construction Industry, Industrial and Labor Relations Review 60: The impact carries over into the non-union sector. Neumark, David and Michael L. Wachter Union Effects on Nonunion Wages: Evidence from Panel Data on Industries and Cities. Industrial and Labor Relations Review 49: Section 2(3) covers employees of a union. NLRB v. Town & Country Elec., 516 U.S. 85 (1995). See also, Sure-Tan, Inc. v. NLRB, 467 U.S. 883, 891 (1984). 5

6 While accepting that state of the law, business owners will argue that they should be able to allow access by persons whose message supports their businesses and exclude persons whose message harms their businesses, with the ability to define supports and harms. There is a surface appeal to this argument, particularly in the current environment of leaving businesses alone to make money and, allegedly, create jobs. Legally, the argument holds up only as long as the message has no legal protection. Enter Section 7, a statute that also limits this formerly absolute property right to exclude anyone. But unlike the antidiscrimination statutes, Section 7 s protections are not based on the status or characteristic of the person protected. Instead, they are based on the message being conveyed by the person. Roundy s will welcome a union organizer into its stores until the organizer starts organizing. In the context of employee activity in non-work areas, the Supreme Court has already said that the message cannot be the determinative factor. Even if the mere distribution by employees of material protected by 7 can be said to intrude on petitioner's property rights in any meaningful sense, the degree of intrusion does not vary with the content of the material. Eastex, Inc. v. NLRB, 437 U.S. 556, 573 (1978). For this reason, a blanket no-solicitation rule will be lawful. The business is exercising its strongest property right the right to exclude any intrusion. But once that business decides to allow some sort of solicitation on its property, it has concluded that the intrusion that occurs by the very fact of solicitation is sufficiently tolerable to allow. If it then implements a rule that bases who can solicit on the message of the solicitor, it runs head on into any solicitation message with legal protection, like Section 7- protected activity. The degree of intrusion is no different when a Girl Scout is trying to sell cookies then when a union employee is distributing handbills. The property owners business interests may not like the message, but their property interests are not damaged in any different manner than how they are damaged by the permitted solicitor. The Sandusky Mall test for determining whether a facially neutral policy has been discriminatorily applied properly recognizes that discretionary application that is really based on the message is contrary to Section 8(a)(1) and is not justified by the business owner s property interest in preventing intrusion. The Supreme Court requires an accommodation of the right to prevent intrusion and the right to communicate a Section 6

7 7-protected message with as little destruction of one as is consistent with the maintenance of the other. Babcock & Wilcox, supra. If business owners can exclude intrusions based on the message of the intruder, then Section 7 rights are not accommodated at all. In many years of practice, this author has never seen a nonunion employer who likes the message of union organizers or handbillers. Sandusky Mall should be reaffirmed. There is an additional argument that both the Board and the courts have missed that supports the Sandusky Mall test. When evaluating what appears to be a facially neutral policy as it applies to employees, the Board will review it by asking the question of whether employees can "reasonably interpret" the policy to prohibit activities protected by Section 7 of the Act. DirectTV U.S. DirecTV Holdings, LLC, 359 NLRB No. 54 (2013). This test has been approved by various circuit courts, including the Sixth. NLRB v. Northeastern Land Servs., 645 F.3d 475, 482 (1st Cir. 2011); NLRB v. Inter- Disciplinary Advantage, Inc., 312 Fed. Appx. 737, 744 (6th Cir. 2008); Guardsmark, LLC v. NLRB, 475 F.3d 369 (D.C. Cir. 2007); Double Eagle Hotel & Casino v. NLRB, 414 F.3d 1249, (10th Cir. 2005); Campbell Soup Co. v. NLRB, 380 F.2d 372, 373 (5th Cir. 1967). The Board also applies this test when looking at a rule that applies to nonemployee but is known to employees. In Ramada Inns, 190 NLRB 450 (1971), the employer had a policy that in one part prohibited employee solicitation during work time and in another part prohibited all nonemployee solicitation. The ALJ looked at the manner that the policy was distributed and concluded that that manner could allow an employee to reasonably interpret the rule as prohibiting all solicitations by employees as well. The Board disagreed with the ALJ s conclusion, but not with the process of looking at how employees may interpret prohibitions on nonemployees. Finally, when looking at this "reasonably interpret" test, it is important to keep in mind that employees are generally intelligent and savvy. Thus, Employees are not likely to miss the inference that the source of benefits [or negative consequences] now conferred is also the source from which future benefits must flow and which may dry up if it is not obliged." NLRB v. Exchange Parts Co., 375 U.S. 405, 409 (1964). If an employer is seen as allowing nonemployees to communicate some messages, but not a message protected by Section 7, those employees could reasonably conclude that no matter 7

8 what the written policy that applies to them says, it does not allow actions that are protected by Section 7 either. HOW DOES REGISTER GUARD FIT INTO THIS ANALYSIS? The topic for this presentation asks whether the Board will overrule Register Guard and, furthermore, whether it should. This paper will not engage in speculation about what the Board will do. Thus, it will now focus on whether Register Guard should be overruled. This author agrees with the position taken by the AFL-CIO, the Building and Construction Trades Department and (amazingly) the Chamber of Commerce. All of them say that Register Guard should not be considered in the analysis of the rights of nonemployees to access under the facts in Roundy s. 4 Register Guard changed the law with respect to alleged discriminatory application of a facially neutral employer policy regulating activities of its employees. The Board stated the new standard to be: Thus, in order to be unlawful, discrimination must be along Section 7 lines. In other words, unlawful discrimination consists of disparate treatment of activities or communications of a similar character because of their union or other Section 7-protected status. 351 NLRB at 118. Thus, under Register Guard, the only time a discrimination argument will be successful is if there is evidence showing that other union or Section 7-protected activity has been treated differently than the activity at issue in the case. This conclusion turns Section 8(a)(1) into an antidiscrimination statute on the order of Title VII. As noted above, this section of the Act was never so intended. When deciding whether a policy that interferes with Section 7 rights is lawful, the Supreme Court employs a balancing test. See Textile Workers Union v. Darlington Mfg. Co., 380 U.S. 263, 269 (1965); NLRB v. Babcock & Wilcox Co., 351 U.S. 105, (1956); Republic Aviation Corp. v. NLRB, 324 U.S. 793, (1945). 5 In the context of a uniformly applied, facially neutral policy against using for anything other than business reasons, the balancing is between Section 7 rights and the employer s 4 Putting aside this author's disagreement with the holding in Register Guard, as a practicing attorney he would prefer that, if the Board wants to reevaluate that decision, it should do so under comparable facts dealing with policies or comparable policies applied to employees and then, only after soliciting input from all interested parties on those relevant issues. The Acting General Counsel is soliciting such cases. GC Memo This test is applied only if the conduct or rule is not inherently destructive of Section 7 rights. NLRB. v. Brown, 380 U.S. 278, 287 (1965); C. G. Conn, Ltd., 197 NLRB. 442, 447 (1972). 8

9 managerial interest ensuring operations and discipline, N.Y. N.Y. Hotel & Casino, 356 NLRB No. 119, (2011). As described above, that is a different interest than the employer s property interest when dealing with nonemployees. That said, it is hard to understand why the discrimination analysis should be any different. If the employer is willing to accept whatever diminution of operations and discipline accompanies the myriad of personal uses of that it allows, saying that it cannot accept the same type of diminution that accompanies the use of for communicating Section 7-protected messages seems to fall squarely within the rationale of Eastex. 6 It is fair to ask why message-based discrimination is any more proper in a case of employee use. Register Guard was wrongly decided and should be overturned in the proper case. Its error should not be compounded by applying it to cases where policies are discriminatorily applied to nonemployees as well. 6 Because the employer in Eastex made no attempt to show that its management interests would be prejudiced in any way by the exercise of section 7 rights proposed by its employees, the Court did not discuss how the discrimination analysis should be accomplished. 9

UNITED STATES OF AMERICA BEFORE THE NATIONAL LABOR RELATIONS BOARD

UNITED STATES OF AMERICA BEFORE THE NATIONAL LABOR RELATIONS BOARD ROUNDY S INC., ) ) and ) Case No. 30-CA-17185 ) MILWAUKEE BUILDING AND ) CONSTRUCTION TRADES COUNCIL, AFL-CIO ) ) BRIEF OF AMICUS CURIAE