1. PowerPoint Presentation by Charlie Cook The University of West Alabama Copyright © 2009 Cengage Learning. All rights reserved. Legal Influences Chapter 3

2. © 2008 Cengage Learning. All rights reserved.3–2 Origin of Labor Relations Law The ConstitutionThe Constitution  Article 1, Section 8 of the U.S. Constitution  The commerce clause grants right of Congress to regulate interstate and international commerce.  Labor relations affect interstate commerce.  First Amendment  Grants rights of assembly, association, and free speech, allows for the formation of unions.  Fifth Amendment  Provides due process rights.  Fourth Amendment  Federal laws preempt state and local laws.

3. © 2008 Cengage Learning. All rights reserved.3–3 Origin of Labor Relations Law (cont’d) Common LawCommon Law  Laws that are not derived from constitutional or statutory laws  Employment-at-will doctrine  An employee or employer may terminate the employment relationship at any time for any or no stated reason. Other SourcesOther Sources  Federal, state, and local statutory law  Judicial decisions  Regulations of federal, state, and local agencies

4. © 2008 Cengage Learning. All rights reserved.3–4 Origin of Labor Relations Law (cont’d) Major Federal Labor Relations LawsMajor Federal Labor Relations Laws  Railway Labor Act  Norris-La Guardia Act  Wagner (National Labor Relations) Act  Taft-Hartley (Labor-Management Relations) Act  Landrum-Griffin (Labor Management Reporting and Disclosure) Act

5. © 2008 Cengage Learning. All rights reserved.3–5 Origin of Labor Relations Law (cont’d) Labor Relations Administrative AgenciesLabor Relations Administrative Agencies  National Labor Relations Board (NLRB)  Federal Mediation and Conciliation Service (FMCS)  U.S. Department of Labor (USDOL)  National Mediation Board (NMB)  National Railroad Adjustment Board (NRAB)  State and local administrative agencies

6. © 2008 Cengage Learning. All rights reserved.3–6 Legal Interpretations Involving Labor- Management Relationships (1806-1931) Basis for the Legal SystemBasis for the Legal System  Protection of employers’ tangible property rights  Protection of employers’ intangible rights to do business and make a profit Criminal Conspiracy DoctrineCriminal Conspiracy Doctrine  Common law interpretation held that it was illegal for workers to join together to pressure employers for better wages or working conditions.  Cordwainers case upheld criminal conspiracy.

7. © 2008 Cengage Learning. All rights reserved.3–7 Legal Interpretations…(1806-1931) Civil Conspiracy DoctrineCivil Conspiracy Doctrine  Legal justification was that employees who acted in concert (unlawful means) could inflict harm on other parties even if the employees’ cause was just (lawful ends).  Commonwealth v. Hunt (1842) ended the use of criminal conspiracy but left in place civil conspiracy.  Courts continued to use jury trials and injunctions to prevent concerted acts and the organization of workers.

8. © 2008 Cengage Learning. All rights reserved.3–8 Legal Interpretations…(1806-1931) Breach of Contract (Contractual Interference) and the Use of the Labor InjunctionBreach of Contract (Contractual Interference) and the Use of the Labor Injunction  The concept that labor disputes constituted interference in contracts between employers and employees.  Yellow dog contracts  Employment contracts requiring an employee to refrain from all union activities or be subject to dismissal.  Courts issued labor injunctions to stop the concerted activities of employees.

9. © 2008 Cengage Learning. All rights reserved.3–9 Legal Interpretations…(1806-1931) Application of Antitrust Legislation to UnionsApplication of Antitrust Legislation to Unions  Sherman Antitrust Act (1890)  Originally intended to prevent the restraint of trade by regulating business monopolies.  Danbury Hatters (Loewe v. Lawlor) case  Supreme Court ruled that the labor organization’s use of the boycott was an illegal restraint of trade.  Individual union members held liable for damages.  Unions supported Clayton Act (1914)—labor no longer considered a commodity and injunctions were limited to prevent injury to property.

10. © 2008 Cengage Learning. All rights reserved.3–10 The Norris-La Guardia Act of 1932 Protection of Workers’ Basic RightsProtection of Workers’ Basic Rights  Limited the power of federal courts to issue injunctions for employees’ lawful non-violence concerted acts as anti-trust violations.  Declared yellow-dog contracts unenforceable.  Encouraged more impartiality by courts in labor disputes. ShortcomingsShortcomings  No regulatory agency designated to enforce the act.  No specific unfair labor practices for employers.

11. © 2008 Cengage Learning. All rights reserved.3–11 The National Labor Relations Act of 1935 Also called the Wagner ActAlso called the Wagner Act  Set national labor policy for labor peace and stability.  Encouraged the use of collective bargaining.  Protected employees’ rights to organization and representation.  Established the National Labor Relations Board (NLRB) to administer and enforce the act.  Defined the unfair labor practices of employers.

12. © 2008 Cengage Learning. All rights reserved.3–12 Exhibit 3.1Rights of Employees Sec. 7 —Employees shall have the right to self-organization, to form, join, or assist labor organizations, to bargain collectively through representatives of their own choosing, and to engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection, and shall also have the right to refrain from any or all such activities except to the extent that such right may be affected by an agreement requiring membership in a labor organization as a condition of employment as authorized In section 8(a)(3). SOURCE: Labor-Management Relations Act, 1947, as amended.

13. © 2008 Cengage Learning. All rights reserved.3–13 Labor Management Relations Act of 1947 Also called the Taft-Hartley ActAlso called the Taft-Hartley Act  Amended the NLRA to balance labor relations policy.  Union unfair labor practices were added to the act.  Set up union security options for states to allow:  Union shops (mandatory union membership)  Open shops (union membership by employee choice)  Agency shops (employees pay only for representation)  Allowed unions to be sued by employers for damages resulting from illegal acts.

14. © 2008 Cengage Learning. All rights reserved.3–14 Labor Management Reporting and Disclosure Act of 1959 Also called the Landrum-Griffin ActAlso called the Landrum-Griffin Act  Passed to protect union member rights and ensure union democracy.  Required secret-ballot elections of union officers.  Required union membership approval in setting dues and levying assessments.  Set federal financial reporting requirements.  Allowed neutral, secondary employers injured by unlawful union activities to sue unions for economic damages.

15. © 2008 Cengage Learning. All rights reserved.3–15 National Labor Relations Board (NLRB) Functions of the NLRBFunctions of the NLRB  To interpret and administer the LMRA  Actions and decisions are subject to federal court review.  Courts are to give deference to NLRB policies.  Responsibilities:  To prevent employer and union unfair labor practices.  To determine employees’ desire for representation.

16. © 2008 Cengage Learning. All rights reserved.3–16 Composition of the NLRB Five-Member PanelFive-Member Panel  Appointed by the President; confirmed by the Senate.  Members serve staggered five-year terms.  Regional offices handle day-to-day affairs. General CounselGeneral Counsel  Investigates and prosecutes unfair labor practice charges.  Represents the Board in federal court when it seeks a court order to enforce its decisions or whenever its decisions are appealed.

17. © 2008 Cengage Learning. All rights reserved.3–17 Persons Covered under the LMRA Sources and Reasons for CoverageSources and Reasons for Coverage  The commerce clause places most private-sector employers and employees under the Act.  The NLRB may refuse to assert jurisdiction in cases where it believes the effect on interstate commerce is minor (de minimus).  Monetary standards for firms set thresholds for coverage of employers.

18. © 2008 Cengage Learning. All rights reserved.3–18 Persons Covered under the LMRA (cont’d) Groups Excluded from Jurisdiction of the Act:Groups Excluded from Jurisdiction of the Act:  Agricultural laborers  Individuals covered by the Railway Labor Act  Private domestic service employees  Individuals employed by parent or spouse  Public-sector employees  Independent contractors  Supervisors

19. © 2008 Cengage Learning. All rights reserved.3–19 Exhibit 3.2NLRB Jurisdictional Standards Determining Employer Coverage under the LMRA Nonretail Business—Direct or indirect sales through others of goods to consumers in other states (called outflow), of at least $50,000 a year; or direct or indirect purchases through others of goods from suppliers in other States (called inflow), of at least $50,000 a year. Retail Business—At least $500,000 total annual volume of business. Office Building—Total annual revenue of $100,000, of which $25,000 or more is derived from organizations that meet any of the standards except the indirect outflow and indirect inflow standards for nonretail firms. Public Utility—At least $250,000 total annual volume of business, or $50,000 direct or indirect outflow or inflow. Newspaper—At least $200,000 total annual volume of business. Radio, Telegraph, Television, and Telephone Firms—At least $100,000 total annual volume of business. Private Health-Care Institutions—(e.g., hospital, HMO, clinic, nursing home)—At least $250,000 total annual volume of business for hospitals; at least $100,000 for nursing homes, visiting nurses associations, and related facilities; at least $250,000 for all other types of private health-care institutions. Hotel, Motel, Residential Apartment Houses—At least $500,000 total annual volume of business. SOURCE: Office of the General Counsel, NLRB, A Guide to Basic Law and Procedures under the National Labor Relations Act (Washington, D.C.: U.S. Government Printing Office, 1997), pp. 35–37.

20. © 2008 Cengage Learning. All rights reserved.3–20 Exhibit 3.2NLRB Jurisdictional Standards Determining Employer Coverage under the LMRA SOURCE: Office of the General Counsel, NLRB, A Guide to Basic Law and Procedures under the National Labor Relations Act (Washington, D.C.: U.S. Government Printing Office, 1997), pp. 35–37. Transportation Enterprises, Links, and Channels of interstate Commerce (e.g., Interstate bus, truck)—At least $50,000 total annual Income from furnishing Interstate passenger and freight transportation services or performing services valued at $50,000 or more for businesses which meet any of the jurisdictional standards except the indirect outflow and inflow standards established for nonretail firms. [Note: Airline and Railroad operations are covered under the Railway Labor Act (RLA), not the LMRA, and thus are not subject to NLRB jurisdiction]. Transit Systems—At least $250,000 total annual volume of business. Taxicab Companies—At least $500,000 total annual volume of business. Associations—The annual business of each association member is totaled to determine whether any of the standards apply. Private Universities and Colleges—At least $1 million gross annual revenue from all sources (excluding contributions not available for operating expenses due to limitations by the donor). Any Firm with a Substantial Impact on National Defense. U.S. Postal Service by enactment of the Postal Reorganization Act of 1970. Symphony Orchestras—At least $1 million gross annual revenue from all sources (excluding contributions not available for operating expenses due to limitations by the donor). Social Service Organizations Not Covered under Any Other Standard—At least $250,000 gross annual revenue.

21. © 2008 Cengage Learning. All rights reserved.3–21 Concerted and Protected Employee Activity Concerted ActivityConcerted Activity  An action taken by or on behalf of two or more employees to express a grievance.  Must be for a purpose contained in Section 7 of the LMRA.  Must be engaged in using lawful means; NLRB decides lawfulness on case-by-case basis. The Interboro DoctrineThe Interboro Doctrine  An employee working alone may be considered to be engaged in concerted activity if seeking to enforce the terms of a collective bargaining agreement.

22. © 2008 Cengage Learning. All rights reserved.3–22 Exhibit 3.3Unfair Labor Practice Procedure SOURCE: National Labor Relations Board. ChargeCharge InvestigationInvestigation Complaint and Answer Hearing and Decision Remedial Order Court Enforcement and Review DismissalDismissal Other Disposition InjunctionInjunction Withdrawal- Refusal to Issue Complaint- Settlement InjunctionInjunction

23. © 2008 Cengage Learning. All rights reserved.3–23 NLRB Unfair Labor Practices (ULPs) Charging PartyCharging Party  The party (union, employer, or individual) filing the UPL charge  Represented by the General Counsel RespondentRespondent  The party accused of committing the violation MeritMerit  A finding that a charge does involve a violation Administrative Law Judge (ALJ)Administrative Law Judge (ALJ)  A judge who presides over the formal ULP hearing

24. © 2008 Cengage Learning. All rights reserved.3–24 Types of Unfair Labor Practice Cases Routine CasesRoutine Cases  Involve ULP charges that do not raise novel or new issues of labor law.  Can be determined by existing Board policies and legal principles. Lead CasesLead Cases  Involve ULP charges that raise a new or novel labor law issue or present the Board with the opportunity to use the decision to create new policy or change existing policy.

25. © 2008 Cengage Learning. All rights reserved.3–25 Remedies in Unfair Labor Practices Cases Cease-and-Desist OrdersCease-and-Desist Orders  Instruct the respondent to stop the ULP.  Require respondent to post written notices of ULP. Affirmative Relief ActionAffirmative Relief Action  Requires the respondent to provide a make-whole remedy to individuals adversely affected by the ULP.  Reinstatement  Compensation and benefits  Promotion and restoration of seniority  An order to bargain in good faith  Decertification of the bargaining representative

26. © 2008 Cengage Learning. All rights reserved.3–26 Federal Courts and NLRB ULP Decisions Courts must enforce decision if:Courts must enforce decision if:  the decision is a reasonable interpretation of congressional intent for the LMRA.  the decision is supported by substantial evidence contained in the case record. Petition for CertiorariPetition for Certiorari  A court of appeals’ decision appealed to the Supreme Court when lower court decisions conflict with each other.

27. © 2008 Cengage Learning. All rights reserved.3–27 Assessment of the LMRA and the NLRB Current Labor PolicyCurrent Labor Policy  Favors the powerful (employers) over the powerless (employees).  Discourages unionism through foot-dragging.  Offers weak, insufficient statutory remedies.  Is grossly outdated and mismatched to the current labor relations environment.  Laws (e.g., Beck rights) protecting individuals have usurped the role of collective bargaining as the employees’ voice.

28. © 2008 Cengage Learning. All rights reserved.3–28 Unions’ View of the LMRA LMRA Reforms that Unions Want Now:LMRA Reforms that Unions Want Now:  Greater access to employees by organizers.  Stronger penalties for employers’ ULPs against union supporters.  Elimination of the use of permanent striker replacements during economic strikes.  No weakening of the Section 8 prohibition of employer domination and interference with union organizations.

29. © 2008 Cengage Learning. All rights reserved.3–29 Common Concerns about the NLRB Excessive slowness of case processingExcessive slowness of case processing  Lack of standards and procedures  Lack of timely decisions on leading cases  Board member turnover and vacancies Initiatives to make NLRB more efficient:Initiatives to make NLRB more efficient:  Creating a three-board member ‘‘super panel’’ system  Creating ‘‘speed teams’’  Providing ‘‘settlement judges’’  Permitting ‘‘bench decisions’’  Creating advisory panels  Increasing the use of the injunction

30. © 2008 Cengage Learning. All rights reserved.3–30 Transportation-Related Labor Relations Laws (Railway and Airlines) Railway Labor Act of 1926Railway Labor Act of 1926  First comprehensive collective bargaining law  Originally covered only railway employees; amended in 1936 to include airlines.  Major RLA disputes are subject to mandatory mediation through the National Mediation Board (NMB).  National Railroad Adjustment Board (NRAB)  Comprised of 18 union and 18 management members  Resolves minor disputes related to terms of the labor agreement (which never expires)

31. © 2008 Cengage Learning. All rights reserved.3–31 Deregulation Legislation Airline Deregulation Act of 1978Airline Deregulation Act of 1978  Ended government regulation of fares and routes.  Resulted in a rapid rise and fall in number of nonunion carriers.  Increased mergers of major airlines.  Economic slowdowns and terrorist attacks further exacerbated poor industry conditions. Staggers Rail Act of 1980Staggers Rail Act of 1980  Increased flexibility in setting rates and service levels.  Strikes have declined but nonstrike actions have increased.

32. © 2008 Cengage Learning. All rights reserved.3–32 Additional Laws That Affect Labor Relations Employee Retirement Income Security Act of 1974 (ERISA)Employee Retirement Income Security Act of 1974 (ERISA)  Establishes minimum standards for the operation of voluntarily established private-sector pension and health benefit plans. The Americans with Disabilities Act of 1990The Americans with Disabilities Act of 1990  Requires “reasonable accommodation” of workers’ disabilities in all areas of the employment process. The Bankruptcy Act of 1984The Bankruptcy Act of 1984  Requires union and employer cooperation to avoid bankruptcy filings and the alteration of contracts.

33. © 2008 Cengage Learning. All rights reserved.3–33 Other Laws…(cont’d) The Worker Adjustment and Retraining Notification (WARN) Act of 1988The Worker Adjustment and Retraining Notification (WARN) Act of 1988  Requires employers to notify employees and communities of major workforce reductions. Racketeer Influenced and Corrupt Organizations (RICCO) Act of 1970Racketeer Influenced and Corrupt Organizations (RICCO) Act of 1970  Prohibits racketeering in an interstate commerce organization.  Provides criminal penalties and allows for triple recovery of damages.

34. © 2008 Cengage Learning. All rights reserved.3–34 Employment Discrimination Laws and Executive Orders Civil Rights Act of 1991Civil Rights Act of 1991  Prohibits discrimination on the basis of race, color, religion, sex, or national origin. Age Discrimination in Employment Act of 1967Age Discrimination in Employment Act of 1967  Prohibits discrimination against persons over 40 years of age. Executive Orders 11246 and 11375Executive Orders 11246 and 11375  Prohibits discrimination in the federal government and by government contractors.

35. © 2008 Cengage Learning. All rights reserved.3–35 Other Related Labor Relations Laws Vocational Rehabilitation Act of 1973Vocational Rehabilitation Act of 1973  Section 503 requires affirmative action by government contractors and federally funded educational organizations in the employment of qualified disabled persons. Uniformed Services Employment and Reemployment (USSERA) Act of 1994Uniformed Services Employment and Reemployment (USSERA) Act of 1994  Protects the returning job rights of individuals called to military service.

36. © 2008 Cengage Learning. All rights reserved.3–36 Related Labor Relations Laws (cont’d) Social Security Act of 1935Social Security Act of 1935  Provides protection against loss of income resulting from unemployment, old age, disability, and death.  Provides protection for survivors of workers. Fair Labor Standards Act of 1938Fair Labor Standards Act of 1938  Sets minimum wage and overtime pay rates.  Prohibits child labor. Employee Retirement and Income Security Act of 1974Employee Retirement and Income Security Act of 1974  Protects and guarantees employee retirements.

37. © 2008 Cengage Learning. All rights reserved.3–37 Related Labor Relations Laws (cont’d) Occupational Safety and Health Act of 1970Occupational Safety and Health Act of 1970  Provisions regulate work place safety and the handling of hazardous materials. Family and Medical Leave Act of 1993Family and Medical Leave Act of 1993  Requires employers to provide unpaid leave for family and medical purposes.

38. © 2008 Cengage Learning. All rights reserved.3–38 Key Terms U.S. ConstitutionU.S. Constitution Common lawCommon law Employment-at-will (EAW) doctrineEmployment-at-will (EAW) doctrine Preemption doctrinePreemption doctrine National Labor Relations Board (NLRB)National Labor Relations Board (NLRB) Labor Management Reporting and Disclosure (Landrum-Griffin) ActLabor Management Reporting and Disclosure (Landrum-Griffin) Act Federal Mediation and Conciliation Service (FMCS)Federal Mediation and Conciliation Service (FMCS) U.S. Department of Labor (USDOL)U.S. Department of Labor (USDOL) National Mediation Board (NMB)National Mediation Board (NMB) National Railroad Adjustment Board (NRAB)National Railroad Adjustment Board (NRAB) Criminal conspiracy doctrineCriminal conspiracy doctrine Commonwealth v. Hunt (1842)Commonwealth v. Hunt (1842) Civil conspiracy doctrineCivil conspiracy doctrine Labor injunctionLabor injunction Yellow-dog contractYellow-dog contract Sherman Antitrust ActSherman Antitrust Act Loewe v. LawlorLoewe v. Lawlor Danbury HattersDanbury Hatters Clayton Antitrust ActClayton Antitrust Act Norris–La Guardia ActNorris–La Guardia Act Closed shop union security clauseClosed shop union security clause National Labor Relations Act (NLRA)National Labor Relations Act (NLRA) Labor Management Relations Act (LMRA)Labor Management Relations Act (LMRA) Union shop union security clauseUnion shop union security clause Agency shop union security clauseAgency shop union security clause Right-to-work lawRight-to-work law The BoardThe Board NLRB jurisdictionNLRB jurisdiction Postal Reorganization Act of 1970Postal Reorganization Act of 1970 Concerted and protected activityConcerted and protected activity Interboro doctrineInterboro doctrine Charging PartyCharging Party RespondentRespondent MeritMerit Administrative Law Judge (ALJ)Administrative Law Judge (ALJ) Routine ULP caseRoutine ULP case Lead ULP caseLead ULP case Cease-and-desist orderCease-and-desist order

39. © 2008 Cengage Learning. All rights reserved.3–39 Key Terms Post written noticesPost written notices Affirmative actionAffirmative action Petition for certiorariPetition for certiorari Railway Labor Act (RLA) of 1926Railway Labor Act (RLA) of 1926 Major dispute under the RLA,Major dispute under the RLA, Minor dispute under the RLA,Minor dispute under the RLA, Employee Retirement Income Security Act (ERISA)Employee Retirement Income Security Act (ERISA) Pension Benefit Guaranty Corporation (PBGC)Pension Benefit Guaranty Corporation (PBGC) Americans with Disabilities Act (ADA)Americans with Disabilities Act (ADA) Bankruptcy Act of 1984Bankruptcy Act of 1984 Worker Adjustment and Retraining Notification Act (WARN)Worker Adjustment and Retraining Notification Act (WARN) Racketeer Influenced and Corrupt Organizations Act (RICO)Racketeer Influenced and Corrupt Organizations Act (RICO) Civil Rights Act of 1991Civil Rights Act of 1991 Age Discrimination in Employment Act of 1967Age Discrimination in Employment Act of 1967 Executive Order 11246Executive Order 11246 Executive Order 11375Executive Order 11375 Vocational Rehabilitation Act of 1973Vocational Rehabilitation Act of 1973 Uniformed Services Employment and Reemployment Rights Act (USERRA) of 1994Uniformed Services Employment and Reemployment Rights Act (USERRA) of 1994 Social Security Act of 1935Social Security Act of 1935 Fair Labor Standards Act of 1938Fair Labor Standards Act of 1938 Occupational Safety and Health Act of 1970Occupational Safety and Health Act of 1970 Family and Medical Leave Act of 1993Family and Medical Leave Act of 1993