Our colleagues Patrick G. Brady and Julie Saker Schlegel, at Epstein Becker Green, have a post on the Retail Labor and Employment Law blog that will be of interest to many of our readers in the hospitality industry: “Beyond Joint Employment: Do Companies Aid and Abet Discrimination by Conducting Background Checks on Independent Contractors?

Following is an excerpt:

Ever since the National Labor Relations Board (“NLRB”) issued its August 2015 decision in Browning-Ferris Industries of California, Inc., holding two entities may be joint employers if one exercises either direct or indirect control over the terms and conditions of the other’s employees or reserves the right to do so, the concept of joint employment has generated increased interest from plaintiffs’ attorneys, and increased concern from employers. Questions raised by the New York Court of Appeals in a recent oral argument, however, indicate that employers who engage another company’s workers on an independent contractor basis would be wise to guard against another potential form of liability, for aiding and abetting acts that violate various anti-discrimination statutes, including both the New York State (“NYSHRL”) and New York City Human Rights Laws (“NYCHRL”) and the New Jersey Law Against Discrimination (“NJLAD”).

Read the full post here.

A Full Menu of Potential Legal Issues for Hospitality Owner/OperatorsIn the new issue of Take 5, our colleagues examine important and evolving issues confronting owners, operators, and employers in the hospitality industry:

Read the full Take 5 online or download the PDF.

A new post on the Management Memo blog will be of interest to many of our readers in the hospitality industry: “‘A Day Without’ Actions – How Can Employers Prepare?” by our colleagues Steven M. Swirsky and Laura C. Monaco of Epstein Becker Green.

Following is an excerpt:

[T]he same groups that organized the January 21, 2017 Women’s March on Washington – an action participated in by millions of individuals across the county – has called for a “Day Without Women” to be held on Wednesday, March 8, 2017. Organizers are encouraging women to participate by taking the day off from paid and unpaid labor, and by wearing red – which the organizers note “may be a great act of defiance for some uniformed workers.”

Employers should be prepared to address any difficult questions that might arise in connection with the upcoming “Day Without Women” strike: Do I have to give my employees time off to participate in Day Without events? Can I still enforce the company dress code – or do I need to permit employees to wear red? Can I discipline an employee who is “no call, no show” to work that day? Am I required to approve requests for the day off by employees who want to participate? As we explained in our prior blog post, guidance from the National Labor Relations Board’s General Counsel suggests that an employer can rely on its “lawful and neutrally-applied work rules” to make decisions about granting requests for time off, enforcing its dress code, and disciplining employees for attendance rule violations. An employer’s response, however, to a given employee’s request for time off or for an exception to the dress code, may vary widely based upon the individual facts and circumstances of each case. …

Read the full post here.

Featured on Employment Law This Week:  The U.S. Court of Appeals for the Fifth Circuit backs the National Labor Relations Board (NLRB) in an outsourcing dispute.

The NLRB found that a management company violated the National Labor Relations Act when it outsourced the cleaning staff of a hotel that it managed. The NLRB found evidence that the outsourcing decision was related to the worker’s interest in union representation. The NLRB rejected the company’s argument that the decision was due to declining guest satisfaction, concluding that the decision was at least, in part, motivated by anti-union animus. The Fifth Circuit has now rejected an appeal by the company, noting that the court was obligated to pay “special deference” to the NLRB’s credibility findings in cases with conflicting evidence, like this one.

Watch the segment below and see our previous blog post.

Our colleague Steven M. Swirsky, a Member of the Firm at Epstein Becker Green, has a post on the Management Memo blog that will be of interest to many of our readers in the hospitality industry: “NLRB Acting Chair Dissents Point to Likely Changes to Board Election Rules and Employee Handbook and Email Standards.”

Following is an excerpt:

NLRB Acting Chair Philip Miscimarra has given the clearest indication to date of what steps a new Republican majority is likely to take to reverse key elements of the Labor Board’s hallmark actions of the Obama administration once President Trump nominates candidates for the Board’s two open seats and the Senate confirms. In each of these cases, Miscimarra highlighted his earlier opposition to the majority’s changes in long standing precedents and practices. …

Read the full post here.

Fifth Circuit Pays Special Deference to NLRB’s Determination that Hotel Management Company Acted With Anti-Union Animus In Outsourcing Housekeeping DepartmentA recent decision of the U.S. Court of Appeals for the Fifth Circuit illustrates the potential pitfalls of outsourcing in the face of a union campaign, as well as the steep hurdle employers face in overturning a decision of the National Labor Relations Board (“NLRB”). In Remington Lodging & Hospitality, LLC v. NLRB, the Fifth Circuit enforced an NLRB order holding that a hotel management company’s decision to outsource the hotel’s housekeeping department was motivated at least in part by anti-union animus and therefore violated Section 8(a)(3) of the National Labor Relations Act (“the Act”).

In late 2011, Remington Lodging & Hospitality, LLC (“the Management Company”) was hired to manage the Hyatt Regency Long Island hotel (“the Hotel”). At the time the Management Company took over management, the Hotel’s housekeeping functions had been outsourced to a staffing company. Consistent with its general preference to directly employ its workers, the Management Company brought the housekeeping function back in-house, and terminated the Hotel’s contract with the staffing company.

Unfortunately, the Hotel’s guest-room component score – its primary indicator of housekeeping effectiveness – continued to decline, and by June of 2012 had hit its lowest level. That month, the Management Company contacted the staffing company about re-outsourcing the Hotel’s housekeeping department, and in August entered into a new agreement with the staffing company to do so.

The NLRB held that this second outsourcing was at least partially motivated by a desire to discourage membership in a union that had begun making efforts to unionize the housekeepers around the time the Management Company elected to re-outsource the department.

On appeal, the Fifth Circuit rejected the Management Company’s argument that to prove a violation of Section 8(a)(3) of the Act, the NLRB must produce evidence that the discrimination “in fact caused or resulted in a discouragement of union membership.” As the NLRB had failed to introduce such evidence, the Management Company argued the NLRB’s order was not supported by substantial evidence.

In rejecting this argument, the Fifth Circuit noted that requiring actual evidence of discouragement was “completely inconsistent” with Fifth Circuit precedent. The court stated flatly the NLRB “need not prove discouragement as a matter of fact.”

While the Management Company asserted that the decline in guest-room component scores explained its decision, the court upheld the NLRB’s resolution of this contested issue of fact. The court noted that the NLRB had relied on evidence of two union-related conversations between housekeepers and Hotel supervisors prior to the outsourcing decision, as well as the statement of another supervisor that the outsourcing decision was “because of the union.” Together these constituted substantial evidence of an unlawful motive. Stating that it must pay “special deference” to the NLRB’s resolution of conflicting evidence, the court upheld the NLRB’s order.

The lesson for employers is a familiar one – be mindful of the potential repercussions of outsourcing decisions, and careful when considering and articulating the underlying motivation. Conflicting evidence is enough to find illegal motivation.

The new episode of Employment Law This Week offers a year-end roundup of the biggest employment, workforce, and management issues in 2016:

  • Impact of the Defend Trade Secrets Act
  • States Called to Ban Non-Compete Agreements
  • Paid Sick Leave Laws Expand
  • Transgender Employment Law
  • Uncertainty Over the DOL’s Overtime Rule and Salary Thresholds
  • NLRB Addresses Joint Employment
  • NLRB Rules on Union Organizing

Watch the episode below and read EBG’s Take 5 newsletter, “Top Five Employment, Labor & Workforce Management Issues of 2016.”

On March 26, the General Counsel (“GC”) of the NLRB signaled that he will be asking the Board to overturn or modify many precedents that negatively impact unions when it comes to organizing and collective bargaining. In Memorandum GC 16-01 (“GC Memo”), the GC directed the Regional Directors in the Board’s offices across the country, who are charged with investigating unfair labor practice (“ULP”) charges and deciding which cases to take to trial, to forward all charges involving issues identified in the GC Memo to the GC’s Division of Advice (“Advice”). It is clear that Advice will instruct the Regional Directors to issue complaints and to follow legal theories advanced by Advice as part of this coordinated effort. The areas identified in the GC Memo include the following:

Cases That Favor Union Organizing and Employee Rights in Non-Union Companies

Increased Employee Access to Employer Email Systems

Regional Directors are now required to refer any case involving the application of Purple Communications, 316 NLRB No. 126 (2014), absent a showing by the employer of “special circumstances” that justify specific limitations. In Purple Communications, the NLRB adopted a presumption that employees with work-related access to an employer’s email system can use the employer’s e-mail to discuss their terms and conditions of employment or union organizing while on non-working time. The GC indicates an interest in expanding access to systems other than email, limiting employer claims of special circumstances justifying restrictions on the use of employer email systems, and curtailing employers’ rights to review employees’ workplace email use on the grounds that such monitoring constitutes illegal surveillance of employee concerted activities protected by Section 7 of the National Labor Relations Act (“NLRA”).

Expansion of Weingarten Rights

The GC also seeks to review cases involving the applicability of Weingarten principles (the right of an employee to have a representative or witness at investigatory interviews that can potentially result in disciplinary action) to non-union workplaces. The NLRB previously held, in IBM Corp., 341 NLRB 1288 (2004), that an employee in a non-union workplace does not have a statutory right to be represented by a coworker in a disciplinary interview.

Broader Union Protection During Organizing Campaigns

Regional Directors must now refer to Advice all cases where remedies for ULP activity could include enhanced access to employer electronic communications systems and non-work areas and providing unions with “equal time” to meet with employees on company premises to respond to so-called captive audience speeches by employers to assembled workers during organizing campaigns.

Review of English-Only Rules

The GC will now more closely scrutinize cases addressing whether English-only rules violate Section 8(a)(1) of the NLRA by limiting employee rights to communicate with coworkers concerning terms and conditions of employment.

Redefining On-Demand Workers and Contractors as “Employees”

The GC’s interest in the employment status of workers in the on-demand, or gig, economy and independent contractors is another effort to expand the scope of the NLRA to individuals traditionally not considered employees.

Limitations on Employer Speech

Regional Directors must now refer to Advice all cases involving the application of Tricast Inc., 274 NLRB 377 (1985), which held that an employer does not violate the law by informing employees that unionization will alter the relationship between employees and management.

The GC also now requires a review of cases involving plant closure threats to a small number of employees in a large workforce. In Springs Industries, 332 NLRB 40 (2000), the NLRB held that a threat made to only one or two individuals is not presumed to have been widely disseminated and thus will not be presumed to have been learned of by all employees in the unit. The GC will likely ask the Board to abandon this rule.

The General Counsel Is Seeking to Dilute Employer Defenses to Strikes

Regional Directors have been directed to refer to Advice any case involving “an allegation that an employer’s permanent replacements of economic strikers had an unlawful motive” and is likely looking to curtail employers’ ability to protect itself from the impact of an economic strike. Notably, in a May 31 decision, the Board agreed with the GC’s argument that the right of employers to hire permanent replacements in an economic strike should be narrowed.

It has always been a principle of NLRA law that employees are protected from discrimination when they strike, but the NLRA does not handcuff an employer’s ability to function or continue production with newly hired strike replacements where employers exercise their right to permanently replace economic strikers. In Hot Shoppes, 146 NLRB 802 (1964), the NLRB held that it was not a ULP for an employer faced with an imminent strike threat to hire permanent replacements and to refuse to oust the replacements when strikers offered to come back to work, absent evidence of an independent unlawful motive. The GC is likely seeking to increase the use of the “unlawful motive” theory to challenge employer decisions to hire permanent replacements for economic strikers.

Whether these initiatives to overrule prior precedent will continue to succeed will play out in NLRB decisions depending largely on the appointments to the NLRB by the next President of the United States.

What Hospitality Employers Should Do Now

In addition to generally being mindful of the principles above, hospitality employers should do the following:

  • Evaluate whether policies limiting the use of company email by employees violate the ruling in Purple Communications, and revise such policies, as necessary, to conform to the ruling.
  • Review whether English-only rules limit employee rights to communicate with coworkers concerning the terms and conditions of employment. If such rules limit employee rights, then consider whether revising those rules to apply only to limited locations (like public areas) is appropriate.
  • Vet any statements to be given to employees regarding whether unionization will alter the relationship between employees and management.

A version of this article originally appeared in the Take 5 newsletter Five Key Issues Facing Employers in the Hospitality Industry.”

Our colleague Steven M. Swirsky, a Member of the Firm at Epstein Becker Green, has a post on the Management Memo blog that will be of interest to many of our readers in the hospitality industry: “Can Your Corporate Social Responsibility Policy Make You a Joint-Employer With Your Suppliers? The NLRB May Find That It Does

Following is an excerpt:

The National Labor Relations Board (NLRB or Board), which continues to apply an ever expanding standard for determining whether a company that contracts with another business to supply contract labor or services in support of its operations should be treated as a joint employer of the supplier or contractor’s employees, is now considering whether a company’s requirement that its suppliers and contractors comply with its Corporate Social Responsibility (CSR) Policy, which includes minimum standards for the contractor or supplier’s practices with its own employees can support a claim that the customer is a joint employer. …

Employers are well advised to review the full range of their operations and personnel decisions, including their use of contingent and temporaries and personnel supplied by temporary and other staffing agencies to assess their vulnerability to such action and to determine what steps they make take to better position themselves for the challenges that are surely coming.

Read the full post here.

Our colleagues Adam C. Abrahms and Steven M. Swirsky, attorneys at Epstein Becker Green, have a post on the Management Memo blog that will be of interest to many of our readers in the hospitality industry: “NLRB Drops Other Shoe on Temporary/Contract Employee Relationships: Ruling Will Require Bargaining In Combined Units Including Employees of Multiple Employers – Greatly Multiplies Impact of BFI Expanded Joint Employer Test.”

Following is an excerpt:

The National Labor Relations Board (“NLRB” or “Board”) announced in its 3-1 decision in Miller & Anderson, 364 NLRB #39 (2016) that it will now conduct representation elections and require collective bargaining in single combined units composed of what it refers to as “solely employed employees” and “jointly employed employees,” meaning that two separate employers will be required to join together to bargain over such employees’ terms and conditions of employment.” …

The potential for confusion and uncertainty is enormous. In an attempt to minimize these concerns, the Board majority stated that the so-called user employer’s bargaining obligations will be limited to those of such workers’ terms and conditions that it possesses “the authority to control.”

Read the full post here.