Human Resources paper

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Describe the labor movement in the U.S. from its beginnings to today.  What went wrong for unionism?  Is it still needed?  Why hasn’t unionism stayed at 1960’s levels?  What is the likelihood of unionism growing again?  Be sure to support your stance with various historical markers, legislation, political stances, and other issues covered in our text and readings.  Please stay within 5-7 pages, 12 point font, double-spaced

Human Resources paper
Contents The Internet saps the fall TV season 24 Lawyers circle another medical device failure 25 ^ The high cost of being into leather 26 Now girls can dress like their avatars 27 Briefs: Best Buy’s worst nightmare 28 Edited by James E. Ellis Companies&lndustries FortheUAW, A Bargaining Dilemma >• Some of the auto union’s newest members receive poverty-level pay “The idea of middle-class wages… in manufacturing has been over for a long time” Preston Bunce, an assembly-line worker at a GM sport-utility vehicle plant in Lan- sing, Mich., is at the center of the upcom- ing contract talks between the United Auto Workers and U.S. automakers. The 29-year-old father of two started in 2008 at $14 an hour and today makes less than $16, a wage that he says is too low to buy a home or purchase the SUV he builds, a Chevrolet Traverse that sells for more than $30,000. His mother, who like Bunce’s grandparents is a CM lifer, makes double his wage for similar work at a CM plant across town. “It is tough to make ends meet,” says Bunce, who also works part-time installing windows and siding when he can find extra work. As the UAW bargains for a new labor deal with CM, Ford Motor, and Chrysler Group, a key question is how much of a raise the union will demand for workers such as Bunce. UAW Presi- dent Bob King has a tough choice: He can push for higher wages to secure new workers a better standard of liv- ing-as the union has for decades while watching its membership shrink by almost 80 percent since 1979, to barely 360,000 members-or he can keep pay low and use the cheap wages as a carrot to get carmakers to increase the number of unionized U.S. jobs. King says that raising the second- tier wage is his top priority in this year’s negotiations, now under way with the Big Three. That runs head-on against automakers who are negotiating buyouts for tenured workers making $28 to $33 an hour with an eye toward replacing “This wage is near federal assistance levels. That’s not the role the auto industry has traditionally played” them with cheaper new hires to com- pete with more-nimble foreign rivals, say two people familiar with the matter who were not authorized to comment. With CM, Ford, and Chrysler all logging profits, the union argues they should pay even new workers enough for a mid- dle-class lifestyle. “There will be tough bargaining on this issue,” says Harley Shaiken, a labor professor at the Univer- sity of California at Berkeley. “The debate is: Can we have a highly competitive auto industry and middle-class wages?” Including benefits, senior UAW workers cost CM $52 an hour and $58 an hour at Ford, says Kristin Dziczek, director of the labor and industry group at the Center for Automotive Research (CAR) in Ann Arbor, Mich. New hires cost $30 to $33 an hour. Despite lower pay, workers line up for the $14-an-hour jobs. Ford, for instance, had 17,000 applicants for 600 entry-wage jobs September 19 – September 25,2011 Bloomberg BusinessWeek Companies&lndustries The Great Wage Stagnation Auto plant wages used to outpace inf iation Real (Inflation-adjusted) wages 1940 1960 1980 2000 2010 1941 At $1.15 an hour, how k>ng to buy… New car: $800 ^”^ 696 hours of work Gallon of gas: $0.20 ^J 0.2 hours Six-pack of beer: $1.11 Hi 1 hour Iw 10 At $5.43 an hour, how long to buy… New car: $4,950 ^^f 912 hours of work Gallon of gas: $0.45 ^^ 0.1 hours Six-pack of beer: $2.20 •• 0.4 hours 2010 At $28.13 an hour, how long to buy… New car: $24,250 ‘S”* 1,059 hours of work Gallon of gas: $3.67 Six-pack of beer: $6.99 0.1 hours I 0.2 hours •BASE HOURLY RATE FOR A MAJOR ASSEMBLER AT FORD DATA: UNITED AUTO WORKERS. BUREAU OF LABOR STATISTICS. US ENERGY DEPT.. NATIONAL AUTOMOBILE DEALERS ASSN at its SUV plant in Louisville last month. The UAW agreed to a $14 wage for new workers (it hits $16 after three years) in 2007, when U.S. car compa- nies were losing money and the union was trying to keep assembly jobs in the U.S. It was a profound shift, since the union had traditionally sacrificed jobs to preserve wages of its members on the factory floor, says Diane Swonk, chief economist at Mesirow Financial. But as the industry slid into crisis, it became clear the union had to give in on wages just to get new people hired. “The idea of having middle- to upper- middle-class wages in manufactur- ing has been over for a long time,” she says. “The automakers are not going to be paying what they once did.” All three car companies declined comment. For workers supporting a family of six, the starting wage at GM assembly plants is at the federal poverty level. Bunce started at $14.12 an hour, or about $29,370 a year. A married couple with four children living on $29,990 is consid- ered to be living in poverty, according to the Health and Human Services Dept. A family of six living on $28,665 could qual- ify for the federal food stamps program. UAW workers in Big Three car plants last made a wage this low in 1985, ac- cording to CAR. Back then, a gallon of gas cost $1.17 and a six-pack of beer was $3.16. A Chevy Celebrity family sedan sold for $8,702, according to industry publication Ward’s Automotive Reports. Today, the Malibu family car starts at $22,735. To get to equivalent inflation- adjusted wages, you would have to go back to 1950, when union workers made $1.58 an hour, says Dziczek. Since 1960, union auto workers have received aver- age raises of 5.2 percent a year, provid- ing a solid middle-class lifestyle. In 1915, Henry Ford doubled assembly wages to $5 a day, or 63(t an hour, says Berke- ley’s Shaiken. That’s about $14 an hour in today’s wages, so the two-tiered wage has reversed much of those gains, he says. “This wage is near federal assis- tance levels. That’s not the role the auto industry has traditionally played.” The lower wages have helped the union secure jobs, however. About 40 percent of the 1,550 UAW workers at GM’s assembly plant in Lake Orion, Mich., are paid $14 an hour. Accepting the lower wage was key to securing pro- duction in the U.S. of the Chevy Sonic, a subcompact engineered in Korea. Small cars have thin profit margins and are often made in low-wage countries. “I’ve got to have a very competitive and unique labor deal in the Lake Orion plant,” GM Vice-Chairman Stephen J. Girsky told analysts on Sept. 7. “We are the only ones building a small car in the U.S.” Even with the lower wage- contract, profits on the $14,495 Sonic will be low. Currently, fewer thiin 3 percent of GM’s workers make the entry-level wage. Chrysler has hired as many as 14 percent of its workers under those terms, and Ford has fewer UAW’s King has decided to push for raises for newer workers than 100 second-tier workers. That could change depending on the new contract. For senior workers. King is seeking better benefits and has said he is open to compensation tweaks that won’t raise automakers’ fixed costs, which may include a mix of profit sharing and bonuses based on achieving produc- tivity and quality goals. “We are going to make sure the companies are com- petitive coming out of these agree- ments,” he said in August at the Detroit Economic Club. Yet he also contends that workers must be rewarded for the $7,000 to $30,000 in concessions they each gave since 2005 to help the U.S. automakers survive. Finding a middle ground won’t be easy. —David Welch The bottom line The UAW, whose memtiership has fallen 80 percent since 1979, may try in contract talks to raise the industry’s $14 hourly starting wage. Television New TV Season, and Fewer People to Watch It • Declining TV households and a drop In young adult viewers hurt • “Online I can watch the few programs I actually care about” As a college student, Jordan Geddis took cable TV for granted. MTV, Comedy Central, and ESPN were just part of the dorm tab at Syracuse University. Even when she moved off campus, Geddis split the bill with roommates. Now, on her own in a tough economy, the 25-year-old General Dynamics engi- neer in Groton, Conn., no longer pays. “When 1 had cable I followed a couple shows, but the rest was garbage to me,” Geddis says. “Online I can watch the few programs 1 actually care about.” With more young adults tuning out this TV season, the industry is confront- ing a generation of viewers who say they won’t pay the typical $75 monthly cable or satellite bill. Nielsen, whose TV ratings influence ad rates, in May cut the estimated number of U.S. TV households by 1 percent, to 114.7 mil- lion, the first drop since 1990. College towns such as Boston, Madi- son, Wise, and Austin, Tex., posted some of the Copyright of Bloomberg Businessweek is the property of Bloomberg, L.P. and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder’s express written permission. However, users may print, download, or email articles for individual use.
Human Resources paper
THE SUPREME COURT’S 14 PENN PLAZA, LLC V, PYETT DECISION: IMPACT AND FAIRNESS CONSIDERATIONS FOR COLLECTIVE BARGAINING By David P. Twomey* I. Introduction David P. Twomey is a Professor at Boston College, Carroll School of Man- agement and member ofthe National Academy of Arbitrators Labor arbitration is an alternative dispute resolution process created by the parties to a collective bargain- ing agreement. In the private sector, an arbitration is generally confined to a question of whether or not a particular action was valid under the CBA. And the powers and duties of an arbitrator are as set forth and limited by the terms of the CBA.’ Some fifty years ago, as part ofits Steelworkers Trilogy,’^ the United States Supreme Court announced a strong presumption in favor of arbitrability in the United Steelworkers v. War- rior & Gulf Navigation Co., as follows: To be consistent with the congressional policy in favor of settlement of disputes by the parties through the machinery of arbitration…[a]n or- der to arbitrate the particular grievance should not be denied unless it may be said with posi- tive assurance that the arbitration clause is not susceptible to an interpretation that covers the asserted dispute. Doubts should be resolved in favor of coverage.^ In the United Steelworkers v. Enterprise Wheel & Car Co. component ofthe Trilogy, the Supreme Court approved the role of arbitrators as the interpreters of the contract in the following language: © 2010 by David P. Twomey THE SUPREME COURT’S 14 PENN PLAZA. LLCV. PYETT DECISION The question of interpretation of the col- lective bargaining agreement is a ques- tion for the arbitrator. It is the arbitrator’s construction which M^as bargained for; and so far as the arbitrator’s decision concerns construction of the contract, the courts have no business overruling him because their interpretation of the contract is different from his.’* Over the years the Supreme Court expanded the use of arbitration in employment disputes beyond arbitration under collective bargaining agreements to approval of the use of arbitration to resolve individual employment agreements to arbitrate statutory rights.^ The Supreme Court in 14 Penn Plazfi, LLC v. Pyett recently decided that a provision in a collective bargain- ing agreement that “clearly and unmistakably” requires union members to arbitrate claims aris- ing under a federal antidiscrimination statute is enforceable and is a waiver of union members’ rights to pursue statutory discrimination claims in federal courts.* The decision was a significant departure from existing precedents going back to the Court’s 1974 Alexander v. Gardner-Denver Co. decision that allowed a union member to pursue a grievance-arbitration remedy under a CBA, and after an adverse arbitration award, to pursue statutory rights in a federal court under the Title VII of the Civil Rights Act of 1964.^ Where once labor arbitrators were focused on the four corners of a collective bargaining agreement, interpreting contractual disputes involving wages, hours and working conditions, labor arbitrators will now, in some cases, inter- pret federal antidiscrimination statutes and case law, and resolve procedural and substantive due process issues inherent in the application of federal statutory law. This paper presents the developing and some- times conflicting Supreme Court precedents involving the waiver of employee statutory rights through mandatory arbitration clauses. It then presents the Supreme Court’s Pyett de- cision. Pyett’s impact on the labor arbitration process is considered along with procedural and fairness issues parties may choose to ad- dress in their contract negotiations on whether or not to require bargaining unit members to arbitrate their statutory discrimination claims. The paper concludes with an assessment of the workability of resolving statutory discrimina- tion claims through arbitration, rather than Article III courts. II. Pre-Pyett Precedent On Mandatory Arbitration Four Supreme Court decisions laid the founda- tion and expressed sufficient conflict to persuade the Supreme Court to grant certiorari in 14 Penn Plazfl v. Pyett to settle issues underlying the distinctions between individual employment agreements to arbitrate and arbitration clauses found in CBA’s. A.Alexander v. Gardner-Denver In the 1974 case of Alexander v. Gardner-Denver Co., the Supreme Court considered the ques- tion of whether Harrell Alexander’s election to invoke grievance-arbitration machinery that resulted in an adverse arbitration award precluded him from filing a subsequent Title VII claim of racial discrimination.** The Court found that it did not.^ The Court held that Title VII was designed by Congress to supple- ment existing laws and institutions involving employment discrimination.'” Moreover, the Court determined that the doctrine of election remedies was inapplicable in the present con- text, which involved statutory rights distinctly separate from the employee’s contractual rights, regardless of the fact that violation of both rights may have resulted from the same factual occur- rence.” The unanimous Gardner-Denver Court held that “an employee’s rights under Title VII are not susceptible of prospective waiver.”‘^ And, the Court set forth the policy statements regarding the appropriateness of arbitration for the resolution of Title VII rights, in part, as follows: Arbitral procedures, while well suited to the resolution of contractual disputes, make arbitration a comparatively inappropri- 56 LABOR LAW JOURNAL ate forum for the final resolution of rights created by Title VIL The conclusion rests first on the special role of the arbitrator, whose task is to effectuate the intent of the parties, rather than the requirements of enacted legislation. Where the collective bargaining agreement conflicts with Title VII, the arbitrator must follow the agree- ment. … Parties usually choose an arbitrator because they trust his knowledge and judg- ment concerning the demands and norms of industrial relations. On the other hand, the resolution of statutory or constitutional issues is a primary responsibility of courts, and judicial construction has proved espe- cially necessary with respect to Title VII, whose broad language frequently can be given meaning only by reference to public law concepts. Moreover, the fact-finding process in arbitration usually is not equivalent to judicial fact-finding. The record of the ar- bitration proceedings is not as complete; the usual rules of evidence do not apply; and rights and procedures common to civil trails, such as discovery, compulsory process, cross examination, and testimony under oath, are often severely limited or unavailable. Indeed, it is the informality of arbitral procedure that enables it to function as an efficient, inexpensive, and expeditious means for dispute resolution. These same characteristics, however, make arbitration a less appropriate forum for final resolution of Title VII issues than the federal courts.’^ B. Gilmer v. Interstateljohnson Lane In Gilmer v. Interstate/Johnson Lane Corp., the Supreme Court held that stockbroker Robert Gilmer’s lawsuit under the Age Discrimination in Employment Act (ADEA) against his former employer could be stayed under the Federal Arbitration Act (FAA), and that he could be compelled to arbitrate his statutory ADEA claim under the FAA rather than pursue his case in a federal court.”’ Gilmer’s registration form with the New York Stock Exchange contained an agreement to arbitrate any controversy arising out of his employment with or termina- tion by a member firm.’^ The Court enforced this broad mandatory arbitration clause even though it deprived Gilmer of his judicial rem- edy, concluding that Congress did not explicitly preclude arbitration of ADEA claims.”^ The Court distinguished its Gilmer decision from Gardner-Denver “povatin^ out that Gardner-Denver did not involve the issue of the enforceability of an agreement to arbitrate statutory claims; and the arbitration in Gardner-Denver occurred in the context of a collective bargaining agree- ment.’^ C. Wright V. Universal Maritime Services Corp. In Wright v. Universal Maritime Services Corp., the Supreme Court addressed the question of whether a general arbitration clause in a CBA required an employee to use the arbitration procedures set forth in the contract to pur- sue a remedy for an alleged violation of the Americans with Disabilities Act (ADA).’** The Fourth Circuit Court of Appeals concluded that the general arbitration provision in the CBA governing Wright’s employment was suf- ficiently broad to encompass a statutory claim under the ADA, and that such a provision was enforceable.” Before the Supreme Court, the employer group asserted that this position was supported in part by Gilmer v. Interstate/Johnson Lane Inc. and a strong federal policy favoring arbitration.^” The plaintiff, Caesar Wright, contended that the Alexander v. Gardner-Denver and Gf/wzer precedents could be reconciled, by maintaining that federal forum rights cannot be waived in union-negotiated CBAs even if they can be waived in individually executed contracts.^’ The Supreme Court did not take up the daunting task of deciding whether or not Gilmer had in fact undermined or over- ruled Gardner-Denver.^^ The Court, following its tradition of judicial restraint, resolved the controversy before it on the narrow basis that the arbitration clause in the parties’ collective 57 THE SUPREME COURT’S 14 PENN PLAZA. LLCV. PYETT DECISION bargaining agreement did not require the work- er to arbitrate his ADA claim.” Importantly, the Court provided this clarification: …whether or not Gardner-Denver’s seem- ingly absolute prohibition of union waiver of employees’ federal forum rights survives Gilmer, Gardner-Denver at least stands for the proposition that the right to a federal judicial forum is of sufficient importance to be protected against less-than-explicit union waiver in a CBA. The CBA in this case does not meet that standard.^” Ultimately the Court distinguished the Wright case from Gi/w^r reasoning that G//wz^r involved an individual’s waiver of his own rights, in contrast to Wright’s case in which there was a waiver of the rights of employees covered by the D. Circuit City Stores v. Adams Following Gilmer, many employers required their non-union employees to agree to broad arbitration clauses as a condition of employ- ment, often inserting such clauses in employee handbooks with due notification to affected employees.^*” New employees at all salary levels have been commonly required to sign such pre- dispute, broad mandatory arbitration clauses on a take-it-or-leave-it basis. A strong challenge to a so-called Gilmer arbitration clause was initiated in the 2001 case of Circuit City Stores, Inc. V. Adams^^ on the theory that the FAA was intended to compel judicial enforcement of arbitration agreements governing commercial disputes and was not intended to apply to em- ployment contracts.^^ The Court of Appeals for the Ninth Circuit had accepted this position in post-Gî/mer litigation.^’ However, in Circuit City Stores, Inc. v. Adams, the Supreme Court overturned the Ninth Circuit’s interpretation ofthe FAA, in a 5-4 decision, rejecting the sup- position that the advantages of the arbitration process somehow disappear when transferred to the employment context.^” Relying on its Gilmer precedent, the Court made clear that in agreeing to arbitration of a statutory claim. a party does not forego substantive rights af- forded by the statute.^’ lll.The Pyett Decision The question presented in 14 Penn Plaza, LLC V. Pyett was whether a provision in a CBA that clearly and unmistakably required union members to arbitrate claims arising under the ADEA was enforceable.^^ The Court of Appeals for the Second Circuit held that Alexander v. Gardner-Denver Co. forbids enforcement of such a provision.^^ The plaintiffs worked as unionized night lob- by watchmen at the 14 Penn Plaza office build- ing in New York City, until the building owner hired a unionized security services contractor to staff the lobby.^’^ The plaintiffs were then as- signed as night porters and light duty cleaners in other locations.^^ The Service Employees Inter- national Union filed grievances challenging the reassignment, asserting that the owner violated the CBA because of: (1) age discrimination, (2) the seniority provision, and (3) the overtime distribution clause.^^ Failing to obtain relief in the grievance procedure, the union initially requested arbitration, believing that it could not legitimately object to the reassignments because it had consented to the contract for the new security personnel.” The union continued to arbitrate the seniority and overtime claims, which they subsequently lost. While the limited arbitration process continued, the plaintiffs filed complaints with the EEOC alleging the owner violated the ADEA.^^ After receiving a right to sue letter from the EEOC, the plaintiffs filed an ADEA lawsuit against the employer in federal district court. The employer responded by filing a motion to compel arbitration under Sections 3 and 4 of the FAA.^’ The district court denied the employer’s motion and the U.S. Court of Appeals for the Second Circuit affirmed relying on both Gardner-Denver and a Second Circuit precedent that a CBA which purports to waive employees’ rights to a federal forum with respect to statutory claims, is unenforceable.”” A divided Supreme Court reversed.'” Justice Thomas, writing for the five-justice majority. 58 LABOR LAW JOURNAL stated that the CBA’s arbitration clause must be honored unless the ADEA itself removes the particular class of grievances from the National Labor Relations Act’s (NLRA’s) broad sweep – which was not the case in this instance.”^ The Court reasoned that the NLRA provided the union and the employer group with statutory authority to bargain over the subject matter of arbitration of work- place discrimination claims, and the ADEA did not terminate that authority.”-‘ Accord- ingly, the Court found that there was no legal basis to strike down the arbitration clause in the CBA.”” The Court then pointed out that the arbitra- tion provision in Pyett is also fully enforceable under the Gardner-Denver line of cases, because the arbitration provision in the Gardner-Denver CBA did not cover statutory claims,”^ while in Pyett, the CBA’s provision expressly covered both statutory and contractual discrimination claims.”^ Moreover, the Court stated that the union and employer group’s decision to resolve ADEA claims by way of arbitration instead of litigation does not waive the statutory right to be free from workplace age discrimination; it waives only the right to seek relief from a court in the first instance.”^ The Court disavowed Gardner-Denver’s state- ment that certain features of arbitration make it “a comparatively inappropriate forum for the final resolution of rights created by Title VII,””^ including questioning the competence of arbi- trators to decide federal statutory claims.”‘ The Court stated that these misconceptions have been corrected, pointing out, for example, that the Supreme Court has “recognized that arbi- tral tribunals are readily capable of handling the factual and legal complexities of antitrust claims, notwithstanding the absence of judicial instruction and supervision” and that “there is no reason to assume at the outset that arbitrators will not follow the law.”^” The Court disavowed Gardner- Denver’s statement that certain features of arbitration make it “a comparatively inappropriate forum for the final resolution of rights created by Title VU.” The Court disposed of the plaintiffs’ confiict- of-interest argument, that a union’s interest and those ofthe individual are not always identical or even compatible, by asserting that the principle of majority rule is in fact the central premise of the NLRA.5′ The Court bolstered its rationale by pointing out that the NLRA imposes a “duty of fair representation” on unions; that a union is subject to liability under the ADEA if it discriminates against its members on the basis of age; and age-discrimi- nation claims may be filed with the EEOC and breach of duty of fair representation claims with the NLRB.52 The majority did not resolve the question whether a collective bargaining agreement’s waiver of a judicial forum is enforceable when the union controls access to and presentation of employees’ claims in arbitration because it was not fully briefed to the Court and made part of the question presented to the Court.^^ Justice Souter’s dissent, joined by Justice Stevens, Ginsberg, and Breyer, reprimanded the majority for evading Gardner-Denver’s xvXe, a case that it contended was controlling prec- edent. Justice Souter asserted federal forum rights may not be waived in union-negotiated contracts, stating “one need only read Gardner- Denver itself to know that it was not at all so narrowly reasoned… .”^” IV. Impact And Fairness Issues Under Pyett The Pyett decision permits employers and unions to bargain away individual employees’ rights to pursue the resolution of statutory dis- crimination claims in federal court, relegating employees to resolve their claim in arbitration. It is anticipated that unionized employers may seek to take advantage of this important change in the law when bargaining new or renewal contracts. Employers perceive litigation cost 59 THE SUPREME COURT’S 14 PENN PLAZA, LLCV. PYETT DECISION and outcome advantages’^ in manda- tory arbitration by avoiding federal court liti- gation. Unions will be required to bargain on this mandatory subject of bargaining. Unions will assess the advantages and disadvantages of mandatory arbitration of statutory claims for their members. If unions agree to the concept, they will demand to have input into the con- tent of any arbitration clause and will expect enhanced economic benefits for its members as quid pro quo for acceptance ofthe arbitration agreement provision, as well as an economic adjustment for the additional costs to be borne by the union for additional representation costs. Impact and fairness issues include the unresolved issue, in Pyett, of a union’s failure to progress an individual’s discrimination claim to arbitration, “clear and unmistakable” waivers in light of post-Pyett trial court decisions, and “fairness” issues including: an overview com- parison of arbitration and litigation, arbitrator competence, grievant representation, rules of evidence, discovery, conflicting time limits and limited court review. A. Failure of a Union to Progress Discrimination Claims to Arbitration In processing a grievance of a bargaining unit member, the union progresses the matter through the contractual grievance-arbitration steps set forth in a CBA, and the union has the discretion to make decisions “in good faith” and “in a non arbitrary manner” as to the mer- its of any particular grievance.” In the absence of any bad faith, a union cannot be found to have breached its duty of fair representation to a union member when it decides not to arbitrate a grievance as non-meritorious.’^ The Pyett court did not resolve the question whether a CBA’s waiver of a judicial forum is enforceable against a union member when the union declines to progress the grievance involving a federal statutory discrimination claim to arbitration.’^ In Kravar v. Triangle Services, Inc., involving an arbitration clause identical in all respects to Pyett, the union re- fused to take Ms. Kravar’s disability discrimi- nation claims to arbitration.”” In adjudicating the case brought by the employer to compel arbitration under Sections 3 and 4 ofthe FAA, the U.S. District for the Southern District of New York relied on the i^^íí principle that “the decision to resolve ADEA claims by way of arbitration instead of litigation does not waive the statutory right to be free from workplace age discrimination: it waives only the right to seek relief from a court in the first instance.”*’ The Kravar court held that the CBA operated to preclude Ms. Kravar from raising her dis- ability claim in any forum. As such, the CBA arbitration provision operated as a waiver of Ms. Kravar’s substantive rights and may not be enforced.^^ B. Negotiating “Clear and Unmistakable”Waivers After P)/ett, a first wave of cases raised a range of i^^W-related enforceability issues. In Mathews v. Denver Newspaper Agency, LLP., the U.S. District Court for the District of Colorado found that the CBA’s arbitration agreement covered the plaintiff’s statutory discrimination claim, and the court concluded that the plaintiff waived his right to seek a judicial remedy.”^ However, in St. Aubin v. Unilever., the U.S. District Court for the Northern District of Illinois found that the “clear and unmistakable” requirement to arbitrate the statutory discrimination claim was not met where the arbitration clause and the anti-discrimination clause were distinct, and the anti-discrimination clause did not refer to arbitration.”’* In Markell v. Kaiser Foundation Health Plan, the U.S. District Court for the District of Oregon determined that where a CBA did not clearly provide for arbitration of statutory claims, the statutory claim should be given de novo consideration in federal court.”’ In Shipkevich v. Staten Island University Hospital, the U.S. District Court for the Eastern District of New York determined that the CBA did not “clearly and unmistakably require” arbitration of statutory antidiscrimination claims.’^’^ Einally, in Méndez v. Starwood Hotels, the Court of Ap- peals for the Second Circuit upheld the lower court’s denial of a motion to compel arbitration based on a letter agreement signed by Starwood 60 LABOR LAW JOURNAL and Méndez because the subject matter of the agreement to arbitrate employment related discrimination claims was subject to mandatory bargaining under the NLRA, and the employer had no right to go outside the collective bar- gaining context to obtain this letter.^” To avoid the time and expense of litigation about “clear and unmistakable” waivers, the arbitration clause in Pyett may be used by employers and unions in contract negotiations as a Court ap- proved model of arbitration clause language that clearly and unmistakably requires union members to arbitrate statutory discrimination claims. The clause states: §30 NO DISCRIMINATION. There shafl be no discrimination against any present or future employee by reason of race, creed, color, age, disability, national origin, sex, union membership, or any other charac- teristic protected by law, including, but not limited to, claims made pursuant to Title VII of the Civil Rights Act, the Americans with Disabilities Act, the Age Discrimina- tion in Employment Act, the New York State Human Rights Law, the New York City Human Rights Code, … or any other similar laws, rules, or regulations. All such claims shall be subject to the grievance and arbitration procedures (Articles V and VI) as the sole and exclusive remedy for viola- tions. Arbitrators shall apply appropriate law in rendering decisions based upon claims of discrimination.^** As discussed in the previous segment of this paper, the Pyett Court did not resolve the ques- tion whether a CBA’s waiver of a judicial forum is enforceable against a union member when the union declines to progress the grievance involv- ing a statutory claim to arbitration. The Kravar decision indicates that the employer would not be able to compel arbitration against the union member in that case. In their contract nego- tiations the parties may choose to address this matter to attempt close this exclusion.*^’ And, in order to obtain union approval of the model waiver clause contained in the Pyett decision. the parties may address other procedural and remedial issues unique to their history of collec- tive bargaining and current circumstances. C. Selected Fairness Considerations Regarding the Arbitration of Statutory Discrimination Claims;With Certain Litigation Comparisons The Py^Wmajority noted that “arbitration proce- dures are more streamlined than federal litiga- tion” as an advantage not an inadequacy, point- ing out that the relative informality of arbitration is one of the chief reasons that parties select arbitration.™ The Court noted that the parties to a CBA “trade the procedures and opportunity for review of the courtroom for the simplicity, informality, and expedition of arbitration.”^’ In this bargained -for exchange of forums, a num- ber of procedural and fairness issues arise which parties in upcoming negotiations of their CBAs may choose to address in deciding whether or not to agree to a contractual provision requir- ing union members to arbitrate statutory dis- crimination claims, and if so, what procedural adjustments, if any, are necessary based on the individualized history and circumstances of the parties themselves. ¡.Arbitration and Litigation Parties to CBAs agree to resolve the complaints of employees who believe they have been wronged through the steps of a contractual grievance-arbitration procedure.^^ The process takes form with the filing of a grievance with a first-line supervisor, whereby the grievant, with the assistance of a union shop steward, states the basis of the complaint in writing on a grievance form, identifies the section of the CBA believed to have been violated, and states the remedy sought. Through a series of procedural steps with specified time limits, the matter is progressed up to the highest designated manager for resolving grievances and a high ranking union officer, such as an international vice president who will meet to attempt to resolve the grievance.” If the par- ties are unable to resolve the grievance, it may be progressed to arbitration.'”‘ 61 THE SUPREME COURT’S 14 PENN PLAZA, LLC V. PYETT DECISION At the arbitration stage, both parties partici- pate in the selection of the arbitrator.^^ The ar- bitrator’s authority emanates from the contract itself and the parties’ “statement of the issue.” The issue and the contract define the jurisdiction of the arbitrator.’^ As compared to the grievance handling and the initiation of the arbitration process outlined above, in litigation, technical pretrial pleadings are complied with and discovery is pursued, consisting of interrogatories between the parties, taking depositions from principal witnesses involved in the controversy and re- quiring the production of relevant company documents and records.’^ Once all of the pre- trial motions have been resolved, the judge presides over the selection of the jury and the trial begins.^^ 2. Arbitrator Competence Arbitrators are usually selected by mutual agree- ment of the parties,’^ or through the process of elimination by striking names from a panel of names of arbitrators with corresponding in- formation about the arbitrators’ backgrounds, experience, and fees.^*^ The American Arbitra- tion Association (AAA) and the Federal Media- tion and Conciliation Service provide panels of arbitrators who are prescreened for their neutrality and experience.^’ Upon selection, an arbitrator is duty bound to disclose any conflict of interest.^^ Federal judges are highly qualified to preside over statutory discrimination cases and to make rulings on all legal issues. They are assigned to cases, as opposed to selection by the parties. And, in federal courts, juries make determina- tions on facts and damages determinations, including compensatory and punitive damages. Employer uncertainty and concern over the po- tential for large damages awarded by juries and the cost of litigation itself, even when successful, has led employers to be the moving party seek- ing to mandate arbitration of statutory claims. Indeed, in Pyett the employer’s brief before the Supreme Court stated that the union accepted the arbitration clause in question in exchange for unit-wide economic improvements.^^ As asserted by the Pyett majority, there is httle doubt that the parties will in fact be able to retain “competent, conscientious and impartial arbitrators” to make findings of fact, and inter- pret the contract and statutory law, and assess appropriate damages in full compliance with statutory law. 3. Conflicting Time Limits Grievance arbitration provisions in CBAs may require grievances to be filed within short periods of time up to thirty days after the grievant knew or should have known of the occurrence giving rise to the grievance.^” Untimely grievances often are refused a hearing unless it is a “continuing violation” of the contract.^’ Antidiscrimination statutes provide much longer periods of time to initiate claims under each statute.^* In union settings with access to immediate advice from shop stewards, union members should be readily able to file their grievances within a contractual time period of up to thirty days. The early filing of a grievance allows the employer and union to investigate matters in a timely fashion while memories are fresh and to obtain other evidence that may exist, in the interest of early and ac- curate resolution of claims. As the parties negotiate contractual language for the arbitration of statutory discrimination claims, they may decide to provide a modified time limit shortening the statutory period for filing such claims to provide for the early reso- lution of claims, writing into the CBA a “clear and unmistakable” waiver of each applicable federal statute’s time limits. A reasonable short- ened time limit for discrimination cases may range from ninety days to six months. However, with the promise promulgated by Gilmer,^^ Circuit City,^^ and Pyetf^ that parties agreeing to resolve statutory claims through arbitration do not forego substantive rights afforded by the statute, shortened statutory time limits will be subject to scrutiny for reasonableness by reviewing courts. 4. Grievant Representation The parties to a collective bargaining agree- ment are the employer and the union, and 62 LABOR LAW JOURNAL they are “the parties” as well at an arbitration under their CBA. The parties apportion the administrative fees charged by the arbitration services agency, and the arbitrator’s fees and expenses. Other than periodic union dues, there is no cost to the grievant. The union also pays the fees of the attorney retained by the union to represent the grievant at an arljitra- tion.^” What if the grievant desires to have his own attorney represent his individual interests at the arbitration? Should the parties negotiate a contractual right for a grievant asserting a vio- lation of an antidiscrimination statute to retain counsel of his or her choice to present the case at the arbitration since the arbitration decision will result in a final and binding resolution of the grievant’s statutory rights? Such is a matter to be resolved by the union and the grievant. It is the union’s right to put on its case for the grievant as it sees fit, so long as the union’s conduct towards the grievant is not arbitrary, discriminatory or in bad faith.^’ However, when requested in statutory discrimination cases, it would make sense for the union to step aside, and allow the grievant’s retained attorney to present the union’s case for the grievant, with the union’s full cooperation. 5. Pre-hearing Procedures CBA’s rarely set forth the rules and procedures for conducting an arbitration. Rather the proce- dures for conducting arbitrations have evolved over time through the combined infiuences of arbitrators themselves and the practice of pub- lication of their awards, the procedures of the War Labor Board, the rules and publications of the AAA, the activities and proceedings of the National Academy of Arbitrators and the con- duct of lawyers.’^ The procedural practices of labor arbitration are widely accepted as fair by workers, unions, employers, and courts.’^ Some further development of arbitration procedures may evolve regarding the pre-hearing role of arbitrators in handling pre-hearing discovery requests in arbitrations involving statutory dis- crimination claims. Section 1.10 of The Second Edition of The Common Law of the Workplace, summarizes some ofthe leading arbitral principles developed over six decades of labor arbitration. It states: Unless mutually agreed to, prehearing dis- covery tools as found in civil litigation—such as prehearing depositions, written inter- rogatories, and requests for admissions-are generally not allowed in labor arbitration. Depositions may be allowed, however, to preserve testimony that would otherwise be unavailable at the hearing.'”* In footnote 10, the Pyett majority recognized that the FAA applies to labor arbitration pro- cedures.”^ Section 7 of the FAA authorizes the arbitrator to “summon in writing any person to attend…as a witness and in a proper case to bring with him.. .any book, document, or paper, which may be deemed material as evidence in the case.”‘^ It also grants a party permission to take the deposition of a witness who cannot be subpoenaed or is unable to attend the hearing.^^ Section 10 of the FAA also allows for a vacatur of an award for an arbitrator’s refusal to hear evidence pertinent and material to the contro- versy.^^ Future litigation may develop guidance as to the extent of additional discovery rights of grievants in statutory discrimination cases. The parties themselves, in negotiating con- tractual language mandating the arbitration of statutory discrimination claims may consider providing for limited discovery rights in bal- ance with the goal of an efficient and effective dispute resolution process, which coupled with the information developed during the steps of the grievance procedure, may very well lead to an early resolution of the matter. 6. Rules of Evidence In an arbitration, the arbitrator may not strictly adhere to the application of the rules of evidence as applied in the federal courts.’^ For example, arbitrators may choose to hear a grievant’s testimony that would have been ruled inadmissible hearsay in a federal court, for the therapeutic value to the grievant, allowing the grievant to tell his or her story “for whatever weight it deserves.”‘”^ However, testimony 63 THE SUPREME COURT’S 14 PENN PLAZA. LLC V. PYETT DECISION of little probative value, like uncorroborated hearsay, is addressed by the arbitrator from the bench or disposed of in the arbitrator’s award.”” In some continuing relationships the parties themselves, in the manner in which they present their cases and assert objections have led to a gradual increase in the strictness ofthe rules of evidence and a resulting increase in legalism in labor arbitration.”^^ As expert tribunals, neutral and competent, it is highly unlikely that an arbitration case will turn on the basis of incompetent evidence. 7. judicial Review of Arbitration Awards Arbitration awards are “final and binding” on the parties as required by specific language set forth in each collective bargaining agreement. As compared to litigation, it is this expeditious, efficient, and final resolution of controversies that provide the major advantage for arbitra- tion over litigation. To maintain this advan- tage, arbitrators’ decisions are afforded an extraordinary level of deference by courts.'”^ Arbitration decisions are subject to limited court review under the FAA.”^” The FAA ap- plies to all employees, with the exclusion of transportation workers engaged in foreign or interstate commerce.'”^ And, as set forth in 7^- ett, the EAA applies to arbitration agreements involving statutory discrimination claims of unionized employees.'”^ The FAA provides streamlined treatment for vacating or modifying or correcting an arbitra- tion award. Section 10 lists grounds for vacating an award, including (1) corruption, fraud, or undue means, (2) evident partiality or corrup- tion by the arbitrators, (3) misconduct of the arbitrators, or (4) the arbitrators exceeding their power. “^^ The grounds for modifying or cor- recting an award under Section 11 of the FAA include (1) evident material miscalculation, (2) evident material mistake, and (3) imperfections on a matter of form not affecting the merits.'”^ The Supreme Court held that Sections 10 and 11 are the exclusive grounds for expedited vacatur and modification of awards with these provi- sions substantiating a national policy favoring arbitration with just the limited review needed to maintain arbitrations essential virtue of resolving disputes straightaway.'”‘ R.esolution of federal statutory discrimination claims through the procedures ofthe EEOC and then the federal trial and appeals courts are the primary dispute resolution process designed by Congress. However, this process is technical, prolonged, and expensive. The expense alone may make it impossible for a unionized worker to pursue statutory rights in the federal courts. Appellate review of federal trial court decisions, however, provides a much broader review of the legal determinations of a trial court than is made of the legal determinations of arbitrators under the FAA. Appellate court review allows for errors of law to be corrected.”” Moreover, the published decisions of the appeals courts provide precedents for the resolution of similar issues in the future.'” As the Court majority expressed in Pyett, “[p] arties trad[e] the procedures and opportunity for review of the courtroom for the simplicity, informality, and expedition of arbitration.””^ Arbitration of statutory discrimination claims is a bargained for, agreed to process, with mutually beneficial features and drawbacks for the parties. It is reserved to the parties themselves to choose whether or not to include a mandatory arbitra- tion of statutory discrimination claims provision in their collective bargaining agreement. V. Conclusion The dissent in Pyett correctly complained that the majority misread Gardner-Denver when it claimed the decision in that case turned solely on the narrow ground that the CBA did not cover statutory claims.”^ And, it is true that under the Pyett decision, unions can, in effect, waive an employee’s right to a jury trial for the employee’s statutory discrimination claim(s). However, the Pyett Court majority decision is now the law. The matter is finally settled. Unions and employers may negotiate a rule in their CBAs requiring the arbitration of statutory discrimination claims as the sole and exclusive remedy for both the violations of the CBA and the antidiscrimination statutes.”” 64 LABOR LAW JOURNAL Under the Gilmer and Circuit City precedents, pre-dispute, broad, mandatory arbitration claus- es in employment contracts, imposed on new or continuing non-union employees by employers on a take-it-or-leave-it basis may be enforceable under the Federal Arbitration Act.'” A narrow exclusion exists for transportation workers.'”^ These unilaterally drafted and imposed arbitra- tion provisions are often unbalanced and unfair to the employees involved.”^ Contrary to these so called “employment arbitration” category of cases is the “labor arbitration” category of cases, as dealt with in Pyett where the arbitration clauses are co-authored by unions and employers. If a union believes it is unfair or unjust to agree to a clause requiring the mandatory arbitration of statutory discrimination claims for all of its members it can refuse to agree to such a provi- sion. Or, if a union is offered “sizeable wage and benefit enhancements” as asserted by the employer in Pyett,^’^ union and employer nego- tiators can modify the Pyett arbitration clause model, balancing and adjusting with agreement language for the fairness and procedural issues raised previously in this article, while retaining for the employees and the employers the full scope of remedies and defenses available in the antidiscrimination statutes. • ENDNOTES Professor, Boston College. Carroll School of Management and member of the National Academy of Arbitrators. The author wishes to express his appreciation to the following faculty at Boston College. Christine Neylon O’Brien and Stephanie Greene for their thoughtful review and comments, and particularly to Margo E.K. Reder for her research assistance and helpful comments. See David P. Twomey, LABOR & EMPLOYMENT LAW, 266(2010). United Steelworkers v. American Mfg. Co., 363 U.S. 561 (I960); United Steelworkers v. War- rior & Gulf Navigation Co., 363 U.S. 574 (I960); United Steelworkers v. Enterprise Wheel & Car Corp., 363 U.S. 593(1960). 363U.S. 574, 582(1960). 365 U.S. 593,599(1960). Gilmer v. Interstate/Johnson Lane Corp. 500 U.S. 20 (1991); Circuit City Stores, Inc. v. Adams, 532 U.S. 105(2001). I29S. Ct. 1456(2009). 415 U.S. 36(1974). W. at 38. Id. at 60. Id. at 48-49. Id. at 49,-50. W. at5l. Id. at 56-58. 500 U.S. 20(1991). Id. at 23. Id. at 29. Id. at 35. 525U.S. 70, 72(1998). Id. at 75. See Id. at 77. Id. See Id. at 77 and 80. The Court handled the Fourth Circuit’s errone- ous interpretation ofthe arbitration clause with judicial tact by simply refusing to apply a pre- sumption of arbitrability to the case before it. Id. at 79. The arbitration clause in question stated; “Union agrees that this Agreement is intended to cover all matters affecting wages, hours and other terms and conditions of employment….” Id. at 73. The plain language of this clause does not purport to vest an arbitrator with authority to decide whether or not the employer violated the Americans with Disabilities Act or discrimi- nation laws in general. Id. at 80. M. at 80-81. See David Lewin, Workplace ADR: What’s New and What Matters? 2007 N.A.A. Proc. 26-27. 532 U.S. 105(2001). See Circuit City, 532 U.S. at 110-111. Id. at 124-128 (Stevens, J. dissenting). Proponents of the position rely on the language of Section 2 of the FAA which makes enforceable writ- ten agreements to arbitrate “in any maritime transaction or contract involving commerce.” 9 U.S.C. §2 (2006). Advocates believe that the legislative history ofthe Act shows that it was in- tended to apply only to commercial and maritime contracts. While there is no legislative history of intent to extend arbitration to employment disputes, proponents point out that the Secre- tary of Commerce, Herbert Hoover, proposed the language, “but nothing herein shall apply to seamen or any class of workers in the interstate and foreign commerce” to allay the fears of a maritime union. Joint Hearing on S. 1005 and H.R. 646, 68»’ Cong. l”Sess. 14 (1924). C/rcuit City, 532 U.S. at 118, 119. Id. at 123. 14 Penn Plaza, LLC V. Pyett, l29S.Ct. 1456, 1461 (2009). Pyett V. Pennsylvania Building Co., 498 F.3d 88 (2d Cir. 2007). 14 Penn Plaza, 129 S. Ct. at 1461. Id. at 1462. Id. Id. Id. Id. Federal Arbitration Act, 9 U.S.C. §§ 3, 4 (2006). Pyett, 498 F. 3d at 93-94. 14 Per)n Plaza, at 129 S. Ct. at 1461. Id. at 1465. Id. at 1466. Id. Id. at 1467. Id. at 1469. Id. Id. at 1471. Id. Id. at 1471, citing Shearson/American Express, Inc. V. McMahon, 482 U.S. 220, 231-232 (1987). 14 Penn P/ozo, 129 S.Ct. at 1472. W. at 1473. Id. at 1474. Id. at 1479. See Theodore St. Antoine, /Viondatory Arbitra- tion: Why It’s Better Than It Looks, 41 U. Mich J.L. Reform 783, 786 (2008) (citing litigation costs as follows; fees and expenses for a successful defense of a discharge case before a jury could range from $ 100,000 in the Midwest to $200,000 on the coast according to a Dean St. Antoine’s informal survey in 1992). Employers may perceive an outcome advantage by avoiding the broad discovery rights available in the federal courts, and have more confidence in the fact finding of an arbitrator selected by the parties as compared to that of a jury. Without regard for whether a workplace is unionized or not, employers fear exposure to what they perceive as possible runaway jury awards in employment discrimination law suits. For example, in a highly publicized case, a jury awarded Anucha Browne Sanders, a former marketing vice president ofthe New York Knicks basketball team, $ 11.6 million in punitive damages for sexual harassment and retaliation against the team’s corporate owner, its chairman, and its president and head coach; and even though the defendants “vehemently disagreed with the jury’s decision” they settled the case under pressure from the NBA Commissioner. See Post-Verdict Settlement Reached in Former Knicks Executive’s Case, DLR NO. 238, A-12 (Dec. 12, 2007). The median award to plaintiffs who won employment discrimination lawsuits between the mid-1990s and the mid-2000s was $250,000, and one in nine cases resulted in plaintiffs receiving $1 million or more each. See Lewin, supra note 26 at 26. See also David S. Schwartz, Mandatory Arbitra- tion and Fairness, 84 Notre Dame L. Rev. 1247 (2009) where Professor Schwartz challenges the fairness of mandatory arbitration of employ- ment disputes involving individual employment agreements to arbitrate forced on employees by their employers, in contrast to arbitration under collective bargaining agreements. Vaca V. Sipes, 386 U.S. 171, 191 (1967). SeeW. at 190-191. 65 THE SUPREME COURT’S ¡4 PENN PLAZA, LLC V. PYETT DECISION 14 Penn Plaza, 129 S. Ct. at 1474. No. I: 06-CV-07858, 2009 U.S. Dist. LEXIS 26459, at *8 (S.D.N.Y., Mar. 27, 2009). Id. at *6 (quoting 14 Penn Plaza. 129 S. Ct. at 1469). No. I: 06-CV-07858, 2009 U.S. Dist. LEXIS 26459 at*9 (S.D.N.Y., Mar. 27, 2009). No. 07-CV-02097, 2009 U.S. Dist. LEXIS 37697, at *I2-I3 (D. Colo. May 4, 2009). The anti- discrimination clause in the CBA stated: “The Employer and the Union acknowledge continua- tion of their policies of no discrimination against employees and applicants on the basis of age, sex, race, religious beliefs, color, national origin or disability in accordance with and as required by applicable state and federal law.” No. 09 C 1874, 2009 U.S. Dist. LEXIS 55626, at *9-IO (N.D. III. June 26, 2009). See also, Dun- nigan v. City of Peoría, No. 09-CV-I064, 2009 U.S. Dist. LEXIS 71797, at *5-7 (CD. III. July 25, 2009). No. CV 08-752, 2009 U.S. Dist. LEXIS 95891 at *I9-2O (D. Or. Sept. 14, 2009). The CBA provided that the parties are “free to arbitrate” disputes regarding “problems arising in con- nection with the application or interpretation of” the CBA itself: that is, arbitration is clearly authorized in connection with contract-based claims only. CBA, Art 9., §§ B(8), A(3). No. 08-CV-1008,2009 U.S. Dist. LEXIS 51011, at *l9-20(E.D.N.Y.June 15,2009). The CBA that governed the parties in this case stated: “Neither the Employer nor the Union shall discriminate against or in favor of any Employee on account of race, color, creed, national origin, political belief, sex, sexual orientation, citizenship status, marital status, disability or age.” Arbitration is contem- plated if the CBA’s grievance procedure does not resolve the dispute: “A grievance…which has not been resolved [under the grievance procedure] may, within thirty (30) working days after completion of…the grievance procedure, be referred for arbitration by the Employer or the Union…”. No. 08-4264-CV, 2009 U.S. App. LEXIS 17113, at*4(2dCir. 2009). 14 Penn Plaza, 129 S. Ct. at 1461. It is unusual indeed for a union not to progress a case of a terminated employee to arbitration. It is an unwritten rule in most unions that every terminated union worker is entitled to his or her “day in court” — meaning a right to go before an arbitrator to challenge the termination. Statu- tory discrimination claims are often raised in such arbitration proceedings. Moreover, in this day and age unions’ interests are very supportive of broad civil rights and it would be unusual for a union to fail to progress a statutory antidis- crimination claim to arbitration. It may well be best for the parties to simply allow this “union declination exception” to exist. Justice Souter’s dissent in Pyett states in closing that “[o]n one level, the majority opinion may have little effect” because of the union declination exception. 14 Penn Plaza, 129 S. Ct. at 1481. However, I believe that the applicability of this exception will be quite unusual. /4 Penn P/oza, 129 S.Ct. at 1471. Id. See generally Frank Elkouri & Edna Asper Elkouri, HOW ARBITRATION WORKS, 198-278 (Alan Miles Ruben Ed. 6″‘ ed. 2003). See id. at 213-214. See id. at 268. See id. at 42-43. (The Federal Mediation and Conciliation Service and the American Arbitra- tion Association provide panels of arbitrators experienced in dealing with labor matters.) See, THE COMMON LAW OF THE WORK- PLACE, 15-16 (Theodore J. St. Antoine ed. 2005). See David P. Twomey & Marianne M. Jennings, BUSINESS LAW, 22 (2″” ed. 2008). See id. at 23. Elkouri & Elkouri, supra note 72, at 171. Id. at 173. See id at 173-175. St. Antoine, supra note 76, at 9. The Code of Professional Responsibility for Arbitrators ofLabor- Manogen^ent Disputes (2003) has been adopted by the National Academy of Arbitrators, the American Arbitration Association, and the Fed- eral Mediation and Conciliation Service. Section 2.B.I of the code mandates that an arbitrator “disclose directly… any current or past manage- rial, representational, or consultive relationship with any company or union” involved, and must disclose “any pertinent pecuniary interest.” See Brief of Petitioners, 14 Penn Plaza LLC v. Pyett, No.07-581, at 6, available at www.supre- mecourtpreview.org, (asserting that “the Union gained sizable wage and benefit enhancements, as well as other favorable provisions, in exchange for its agreement to arbitrate its members’ statutory employment claims” ). Elkouri & Elkouri, supra note 72, at 213-217. Id. at 217-219. See the Lilly Ledbetter Fair Pay Act of 2009,42 U.S.C.§2000-a note (2009), (provid- ing that every paycheck resulting from an earlier discriminatory pay decision would constitute a continuing violation of the Civil Rights Act provided the employee filed charges within 180 day of the discriminatory paycheck). See the 180-day and 300-day initial filing periods of Title VII of the Civil Rights Act of 1964, 42. U.S.C.§2000-5(e)(l)(2000). aimer, 500 U.S. at 26. Circuit City, 532 U.S. at 123. 14 Penn Plaza, 129 S. Ct. at 1469. A union ordinarily does not breach its duty of fair representation merely because it uses a union representative rather than an attorney to present the union’s case at the arbitration hearing. See Elkouri & Elkouri, supra note 72, at 303. However, having bargained for the right to arbitrate bargaining unit employees’ statutory employment discrimination claims, to provide representation with a person without legal training and experience may well be on its face a violation of the union’s duty of fair representation. Vaca V. Sipes 386 U.S. 171, 190 (1967). See Laura J. Cooper, The Process of Process: The Historical Development of Procedures in Labor Arbitration, 2005 N.A.A. Proc. 19-20. Id. at 20. St. Antoine, supra note 76 at 12. 14 Penn Plaza, 129 S. Ct. at 1471. 9 U.S.C. §7(1994). Id. 9 U.S.C. § 10(1994). Elkouri & Elkouri, supra note 72, at 341. St. Anoine, supra note 76, at 32. See Elkouri & Elkouri, supra note 72, 2008 Supp. 159. See W. Daniel Boone, How to Have an Arbitration Hearing In One Day or Less, 2007 N.A.A. Proc. 91-95. See Crawford Group, Inc. v. Holekamp, 543 F.3d 971, 976 (8″‘Or. 2008). 9 U.S.C. §§ 1-16(2006). Circuit City Stores v. Adams, 532 U.S. 105 (2001). 14 Penn Plaza, 129 S. Ct. at 1471 n.lO. 9 U.S.C. § 10(2006). 9 U.S.C. § II (2006). In Hall Street Associates, LLC v. Mattel, Inc., 552 U.S. 576 (2008), the Supreme Court rejected enforcing additional grounds agreed to by the parties for setting aside an award under the FAA, including the ground that “the arbitrator’s conclusions of law were erroneous.” Id. at 579. The Court stated any other reading opens the door to the full-bore legal and evidentiary ap- peals that can “rende[r] informal arbitration merely a prelude to a more cumbersome and time-consuming judicial review process.” Id. at 588. FED. R. CIV. P. 52(a). Selected arbitration decisions are published by numerous publishing houses serving as guidance for parties in resolving grievances prior to arbi- tration and as persuasive reasoning supportive of a party’s position in arbitration. 14PennP/aza, I29S. Ct. at 1471 (quotingMitsubi- shi Motors Corp. v. Soler Chrysler-Plymouth, Inc., 473 U.S. 614, 628(1985)). 14 Penn Plaza, 129 S. Ct. at 1479. Under an arbitration clause modeled on the Pyett clause, an employee asserting that he or she has been discharged without just cause and who is also claiming that the discharge was the result of age discrimination, the arbitrator will consider the facts and circumstances that encompass both claims, and make a determi- nation on the contractual just cause claim and the contractual/statutory discrimination claim of age discrimination. The employee will no longer be able to bring a statutory claim in a federal forum under Cardner-Denver after an adverse arbitration decision on a contractual claim. The matter is resolved in an expeditious, timely and just manner, before an expert on labor and employment law, with lower overall costs for all. Should the employee be successful, the employer can take expeditious corrective action, and provide full statutory remedies covering a much shorter time period and thus lower damages. Moreover, the process is a private one, and not a source of adverse public- ity in the case of an adverse decision. Should the employee be unsuccessful, the controversy is resolved in a shorter period of time, with a decision explaining why the claim lacked merit, and the individual can move forward with his or her life, short of the years that are sometimes consumed in prolonged litigation. See the discussion of the Cilmer precedent in part N.B. of the text and the discussion of the Circuit City precedent in part II.D. of the text. Circuit City, S32 U.S. at 119. A resolution of the unfairness issues is proposed in the Arbitration Fairness Act of 2009, now pending before Congress, S. 931, H.R. 1020, II'” Cong. (2009). The bill would prohibit pre-dispute arbitration agreements and would promulgate due process standards to apply to “employment arbitration” cases. The bill excludes coverage of arbitration provisions in collective bargaining agreements. See Section 401. See Brief of Petitioners, supra note 83. 66 Copyright of Labor Law Journal is the property of CCH Incorporated and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder’s express written permission. However, users may print, download, or email articles for individual use.
Human Resources paper
UNIONS IN THE HEALTHCARE INDUSTRY By Leslie Goff Sanders, Esq. and Alonda W. McCutcheon, Esq. Leslie Sanders, formerly of counsel at Berry 8i Sims PLC, in Nashville, Tenn., pracüced law witíi the Firm’s Executive Compensation and Labor and Employ- ment Practice. Leslie is now a member ofthe firm Webb Sanders pile where she continues to practice in the same areas. Alonda McCutcheon is an associate with Bass, Berry, Sims. She has worked in the Labor and Employment Practice Area since September 2002. She is a member ofthe firm’s Diversity Commit- tee and a charter member ofthe firm’s African-American Affinity Group. 142 L abor unions in the healthcare industry have been much in the news of late, particularly the emer- gence of large and well-funded nursing unions. There is a sense of urgency among nursing unions to organize nurses in large numbers, as well as an increased push to organize other groups of healthcare workers. What is the impact of this increased organizing activ- ity within the healthcare industry? Beyond the obvious answer of unions’ desire to rebuild ailing labor unions and increase dues revenue, in order to fully answer thèse questions, it is important to understand both the past and the current labor relations landscape. This article will provide an overview ofthe application of labor law in the healthcare industry and a practical discussion of the changes businesses will face if their workforce becomes unionized. I. Labor Relations 101 Traditionally, people think of unions as the champions of the blue-collar worker in the manufacturing setting. The service industry has outgrown the manufacturing industry, which means the focus of union organizing activity has shifted as well. For the healthcare industry, the origin of this “shift” dates back to 1967 when the National Labor Relations Board (NLRB) first recognized the right of hospital work- ers to join unions and participate in collective bargaining with their employers.’ In 1974, Congress amended the National Labor Relations Act (NLRA) to cover both for-profit and nonprofit healthcare institutions under the provisions and restrictions of the NLRA.^ © 2010 by Leslie Goff Sanders, Esq. and Alonda W. McCutcheon, Esq. LABOR LAW JOURNAL The NLRA gives employees certain rights including: (1) the right to form, join or assist labor organizations (i.e. unions); (2) the right to collective bargaining; (3) the right to engage in concerted activity with their co-workers for their mutual benefit or protection; and (4) the right to refrain from participating in union activities.^ These rights, combined with the fact that hospi- tals are subject to the NLRA, make it possible for healthcare workers to join unions. A. Appropriate Bargaining Units A bargaining unit is defined as “a grouping of two or more employees aggregated for the as- sertion of organizational rights or for collective bargaining.”” Unions may become certified when a majority of workers in the appropriate bargaining unit seek union representation. In determining what is an appropriate bargaining unit, the NLRB considers similarity of skills, work hours, wages and working conditions as well as the desires of the employees, bargaining history and the extent of union organization.’ In the healthcare industry, the appropriate bar- gaining unit is often a topic for debate. In acute care hospitals, there are, with rare exceptions, only eight presumptively appropriate bargaining units: (1) registered nurses; (2) physicians; (3) all professionals except for registered nurses and physicians; (4) technical employees; (5) skilled maintenance employees; (6) business office cleri- cal employees; (7) guards; (8) all nonprofessional employees, except for technical employees, skilled maintenance employees, business of- fice clerical employees and guards.* In all other healthcare facilities, the NLRB considers the “community of interest” and determines appro- priate bargaining units on a case-by-case basis.’ The recognition of these distinct, separate units in the hospital has made it easier for groups of employees to organize. For example, if the NLRB determined that a broader group of employees still has a sufficient “community of interest” to constitute an appropriate unit, then nurses would arguably have a more difficult time generating the requisite support for a union when lower paid, less skilled employees do not have the same concerns or interests as the nurses. In Boston Medical Center Corp.^, a significant decision in this industry that directly impacts the determination of an appropriate bargaining unit, the NLRB overruled its prior decisions and held that interns, residents, and fellows were employees and, therefore, could engage in col- lective bargaining and select a labor organization to represent them. Previously, this category was excluded because the role was considered to be primarily that of a student, not an employee. In public service or government facilities, the rules regarding the appropriate bargaining unit may differ. Such facilities are generally subject to state laws which will vary with respect to the determination of appropriate bargaining units, and, thus, the NLRE’s community of interest rules would not apply. For example, in New York, the Pubhc Employees’ Fair Employment Act permits government employees to orga- nize and requires public employers to enter into agreements with the union.” Government employers include public benefit corporations which encompass certain hospitals in the state of New York.'” Because the Public Employees’ Fair Employment Act does not have the same rules as the NLRA, bargaining units at public hospi- tals in New York may be composed of multiple disciplines and professions as opposed to those specifically enumerated in the NLRA rules. Of course, American labor law specifically excludes supervisors from the bargaining unit.” A supervisor is defined as “any individual hav- ing authority, in the interest of the employer, to hire, transfer, suspend, layoff, recall, promote, discharge, assign, reward or discipline other employees, or responsibility to direct them, or to adjust their grievances, or effectively to recom- mend such action, if in the connection with the foregoing the exercise of such authority is not of a merely routine or clerical nature, but requires the use of independent judgment.”‘^ Several courts have wrestled with this defini- tion when determining whether a charge nurse may be a member of a bargaining unit. In NLRB V. Health Care (^Retirement Corp.,” an employer was accused of committing an unfair labor prac- tice by disciplining four LPNs for engaging in union activity. The NLRB had found that the 143 UNIONS INTHE HEALTHCARE INDUSTRY only discretion exercised by the LPNs was in the interest of patient care, not in the interest of the employer, and they were not, therefore, supervisors. The employer argued that the LPNs were supervisors, because they were responsible for ensuring adequate staffing, assigning work and evaluating the work performance of and issuing discipline to nurses’ aides. The United States Supreme Court rejected the NLRB’s distinction between acts taken in connection with patient care and acts taken in the interest of the employer, and it concluded the LPNs were supervisors. A few years later in NLRB v. Kentucky River Community Care, Inc.,^^ the Supreme Court re- viewed the NLRB’s order requiring a mental health care facility to bargain with RNs, whom the employer contended were supervisors. The NLRB ruled that, while the RNs exercised discretion with respect to the supervisory acts identified by the NLRA, their “independent judgment” was “ordinary professional or techni- cal judgment in directing less-skilled employees to deliver services.”‘^ Thus, according to the NLRB, the RNs were not “supervisors.” The Su- preme Court rejected this limitation and refused to enforce the NLRB’s order requiring the health care facility to bargain vsdth the RNs. In Oakwood Healthcare, Inc.,”‘ the NLRB de- termined that, while regular charge nurses at an acute care hospital were supervisors, the “rotat- ing” charge nurses were not supervisors. The NLRB noted that when an individual spends a regular and substantial portion of his work time performing supervisory functions, he is a supervi- sor and exempt from the NLRA.” (The NLRB will generally find supervisory status where the individual serves in a supervisory role for at least 10 to 15 percent of his total work time, though there is no strict numerical definition.)’^ In Oak- wood, the facility did not have an established pattern or predictable schedule for when and how often RNs take turns in working as charge nurses. The regular charge nurse worked 10 out of 14 days in a pay period. On the four days the charge nurse was off, other nurses would assume the role of charge nurse. The hospital did not have a designated method for choosing the RN that would rotate into the charge nurse position. In the absence of any showing of regularity, the NLRB determined that the rotating charge nurses’ supervisory duties were not a substan- tial part of their work time, and therefore, they were properly included in a bargaining unit of nurses. B.The Election and Campaign Process In order to be represented by a union, the em- ployees seeking representation generally sign a petition or authorization cards indicating their interest in union representation.” The NLRB then determines if there is a sufficient showing of interest in an appropriate unit.^” The NLRB requires that 30 percent of the workers express interest.^’ Signing the petition or the authoriza- tion card does not mean that the worker must vote for the union in a subsequent election. A company may voluntarily recognize a union when a majority ofthe workers Mdthin an appro- priate bargaining unit expresses interest in union representation. Under these circumstances, if requested the NLRB will certify a union as the exclusive bargaining representative of the employees within the bargaining unit.” In the absence of voluntary recognition, the NLRB will hold a secret-ballot election in which the employees in the particular bargaining unit are eligible to vote on whether they want to be represented by a union.” If a majority of the employees in the unit who vote cast their ballots in favor of union representation, then the NLRB will certify the union as the exclusive bargaining representative.^” The election process could change if Congress enacts labor-friendly legislation. The Employee Free Choice Act (EFCA) has garnered much attention from employers and unions. EFCA has lost momentum since it was introduced as a bill, but labor reform remains a top priority for some lawmakers and organized labor. EFCA in its most recent form would have taken away the secret ballot election so that if a majority of em- ployees in a bargaining unit indicate approval of a union election on a card or petition, this would effectively be a vote for the union.” Generally speaking, unions favor this type of legislation 144 LABOR LAW JOURNAL in part because the absence of secret-ballot waive fees if such offer is unconditional, unam- elections wifl increase the likelihood of union success.^^ By the same token, businesses are not in favor of this type of legislation in part because a union could organize the employees without any notice whatsoever to the employer.” There have long been talks of compromise indicating that some type of legislation to amend the NLRA biguous and applicable to all employees.” During a pre-election campaign, employers may not punish or reward employees based on their pro-union or anti-union activities un- less the conduct violates legal policies and procedures, makes threats” (“We will close the plant if the union wins the election.”), conduct^” could stiflemerge.^^ The prospect of EFCA being polls or surveys of employees’ support for passed in some itera- tion could also change the landscape of the campaign process as we currently know it. Cur- rently, employers are put on notice of union organizing activity when a representation petition has been filed (if the employer has not already caught wind ofthe organizing efforts). The short period of time between the filing of the petition and the date of the election (usually an average of 42 days) is the campaign period. As discussed above, the concern is that legislation similar to EFCA would eliminate this campaign period because by the time an employer had notice of union organizing the union is likely to have secured a sufficient showing of interest. During a union campaign, both the employer and union must be careful that they do not en- gage in conduct that may interfere with, restrain, or coerce employees in the exercise of the rights guaranteed in Section 7 of the NLRA.” So what conduct can employers and unions lawfully en- gage in during a campaign? Both sides can convey their respective messages through literature and campaign paraphernalia (i.e. buttons, t-shirts, etc.) Employers can discuss the disadvantages of having a imionized workforce,^” compare their compen- sation and benefits with union shops and other employers, solicit employee grievances as long as there is no promise to remedy the grievance,^’ and correct any untrue statements made by the union. Employers also can attempt to curb union campaign activity by enforcing non-solicitation and non-distribution policies. (See below for fur- ther discussion of solicitation and distribution.) The prospect of EFCA being passed in some iteration could also change the landscape of the campaign process as we currently know it. union, make” promises (“You will get a raise or promotion if you vote against the union.”), and conduct surveillance of employees,’* including videotaping and photo- graphing employees.” Employers cannot law- fully prohibit the wearing of union buttons and insignia absent “special circumstances” justifying the restriction.” Much like employers, unions also are prohibited from threatening” non- supporters and from unexplained photographing or videotaping of employees.”” Having well-established policies concerning solicitation and distribution in the workplace is critical to combating the threat of union orga- nization. However, if such policies do not exist or have not been consistently enforced prior to union organizing, then an employer may not adopt or attempt to enforce such policies in order to deter union activity.”‘ The key with regard to the enforcement of any non-solicitation and non- distribution policy is ensuring that the policy is applied in a non-discriminatory manner. An employer may prohibit solicitation and distribution during working time.”^ Distribution of literature may be further restricted to work areas.”‘ These restrictions must apply to solicita- tion and distribution of any nature, not just union activity.”” Solicitation can occur, however, dur- ing non-working time such as breaks, lunch, or before and after a shift.”‘ Similarly, distribution of literature can occur during nonworking time and in nonwork areas.”* A prohibition against solicitation and distribution by off-duty em- ployees is permitted only where the employer’s Conversely, a union may offer to reduce dues or pohcy restricts the off-duty employees’ access 145 UNIONS IN THE HEALTHCARE INDUSTRY to working areas or the inside of the facility and such policy has been clearly disseminated to employees and consistently enforced against any off-duty employee seeking access, not just against those engaged in union activity. Gener- ally, an employer cannot prohibit off-duty em- ployees from soliciting and distributing outside the facility in parking lots or other nonworking areas. Moreover, a policy that prohibits an em- ployee from “loitering” after working hours is likely unlawful.”‘ E-mail serves as an important tool for com- munication in the healthcare industry. This is particularly true for communication between employees on different shifts or in different fa- cilities operated by the same business. While it is permissible for healthcare companies to limit e-mail usage for business-related communication only, selectively enforcing the policy can violate the LMRA.””* Unions will use e-mail as a method of communication because it is an efficient and effective way to reach employees. Employers need a clear e-mail communication policy that limits soUcitation and other non-business related e-mails, and the employer must uniformly disci- pline employees who violate the policy Unions are not only targeting healthcare workers but they are also appealing to patients and the patient’s families. In healthcare fa- cilities, employers can restrict solicitation and distribution in “immediate patient care areas,” such as operating rooms, patient rooms and treatment rooms.”‘ A hospital also may restrict non-employees from entering the property and communicating with patients or their families.'” On the other hand, hospital employees are generally permitted to solicit and distribute to patients and their families during nonworking time and outside of patient care areas. C. Negotiations Between the Union and the Company Once a union is certified, then it is the exclusive representative ofthe appropriate bargaining unit, for example, the nurses.” This means that only the union may negotiate with the healthcare facil- ity regarding nurses’ rates of pay, wages, hours of employment and other conditions of employ- ment.” The union will be the representative of fl//the nurses in the bargaining unit, not just the nurses that actually voted for the union or pay union dues.” If a union is certified, then as a gen- eral rule, the employees in the bargaining unit will not have individual contracts with the facility that pertain to the conditions of employment. Currently, the NLRA requires employers and unions to negotiate in good faith, but there is no requirement the parties reach an agreement within a certain period of time. If legislation such as EFCA is passed, it could limit the negotiations between the union and the employer by forcing mandatory arbitration of initial disputes.'” Such legislation could add timelines to the initial bargaining process. EFCA would have required the parties to reach an agreement within 90 days after the bargaining process begins. If no con- tract is executed after 90 days, then either party could request mediation. If there is no agreement reached within 30 days from the date media- tion is requested, then an arbitrator will decide the terms of the contract that the parties will be required to follow for the next two years.” This is an example of the type of labor reform that has been considered. Essentially, such reform would take the bargaining process out of the hands of the parties who know the most about the particular healthcare facility and place it in the hands of a neutral arbitrator who is not familiar with the business. ll.The Current Union Landscape In February 2009, three nurses unions repre- senting nearly 150,000 nurses announced plans to merge and form the largest nurses’ union to date.« The United American Nurses (“UAN”), the California Nurses Association (“CNA”), and the Massachusetts Nurses Association (“MNA”) formed a “Super Union” known as the Na- tional Nurses United. (“NNU”) on December 7, 2009 in Phoenix, Arizona.” The focus of the NNU is to engage in widespread organizing as “a substantial majority of the budget shall be dedicated to new organizing;”‘^ create a national Taft-Hartley pension plan for union registered nurses, and emphasize protecting and expanding 146 LABOR LAW JOURNAL the rights of registered nurses, including promot- ing the passage of National Nursing Shortage Reform and Patient Advocacy Act.” Just two months after the announcement of the “Super Union”, six state nurses associations that were formerly affiliated with the UAN announced the formation of a new national nurses’ labor federation – the National Federa- tion of Nurses (“NFN”).'” This union represents approximately 70,000 registered nurses in various states including New Jersey, New York, Ohio, Montana, Oregon and Washington.”‘ The NFN stated that it will differ from the NNU in that each state affiliate will be autono- mous and may voluntarily join the national organization.”2 According to NFN literature, the sole purpose of NFN is “to provide sup- port, education and assistance to nursing labor organizations (NLOs) who represent RNs for collective bargaining.””‘ Similar to the NNU, the NFN also supports pension reform and workplace protections.”” The Service Employees International Union (“SEIU”) has over 2 million members and rep- resents a variety of service employees, including healthcare workers.”^ Ofthe 2 miUion plus mem- bers, nearly half are in the healthcare industry with 110,000 nurses and 40,000 physicians.”” In March 2009, the SEIU and the CNA announced a cooperation agreement in an effort to unionize healthcare workers and step up efforts to enact the EFCA.”‘ The two unions have vowed to refrain from “raiding” each other’s members.”* The agreement between the two rival unions has been referred to as a “truce.””‘ However, SEIU president Andy Stern has said that it is more than a truce: “[i]t’s really trying to establish a partnership at a moment of profound change in our country.” According to the CNA, it will be the leading voice for RNs and SEIU the lead- ing voice for all other hospital workers™ though the SEIU certainly has a strong contingency of nurses under its umbrella. At least one union, the National Union of Healthcare Workers (“NUHW”), is not joining forces with the SEIU to organize healthcare workers. Expelled from office by SEIU President Andy Stem, these former Executive Board mem- bers and Stewards of SEIU United Healthcare Workers-West (“SEIU-UHW”)” formed their own independent union on January 28, 2009 and are hoping to attract non-unionized health- care workers as well as healthcare workers who are currently being represented by the SEIU.” NUHW purports to advance the practices and principles of SEIU-UHW and seeks to restore effective representation for SEIU-UHW mem- bers who are under the “dictatorial control of SEIU’s appointed trustees.”” lll.The Impact on Healthcare The answer to the question “why the hype” is really quite simple – the current White House administration. Rose Ann DeMoro’s, now the executive director of National Nurses United comment says it all: “the Obama administration has certainly been a shot in the arm….” for the ailing labor unions.'” President Obama received tremendous support from organized labor during his campaign and is expected to support union- friendly legislation throughout his presidency, though his support of organized labor took a back seat to healthcare reform and the economy. In fact, the day of his inauguration President Obama took a major step toward returning the support from organized labor with the appoint- ment of Wilma B. Liebman as Chairman of the NLRB. Ms. Liebman was first appointed to the Board in November 1997 by former President Bill Clinton.’^ Ms. Liebman replaces Peter Carey Schaumber as Chairman. Mr. Schaumber ex- pired term on August 27, 2010.'” He was serving in his second term on the Board, having been ap- pointed by former President George W. Bush in September 2005.” President Obama nominated Craig Becker (Democrat), Mark Gaston Pearce (Democrat) and Brian Hayes (Republican) to the three remaining Board seats. On June 22, 2010, the Senate confirmed Hayes and Pearce, but Becker was not confirmed. Becker is cur- rently on the Board filling a recess appointment by President Obama which is set to expire in December 2011. Controversy ensued over the nomination of Becker who served as Associate General Counsel to both the SEIU and the AFL- 147 UNIONS IN THE HEALTHCARE INDUSTRY CIO when Senator John McCain threatened to employees in other facilities. Because campaigns place a hold on Becker’s nomination. Even more significant is the support President Obama has received from the unions on health- care reform. Last year, DeMoro said, “we’re going to be pushing the Obama administration to imple- ment the most progressive health-care reform imaginable, which is universal health care, the highest standard of care for all patients.”‘* There can be little doubt that unions will continue to turn up the heat on passage of labor reform.” Once employees organize, then the land- scape at the healthcare facility will change. At non-union facilities, people often refer to the human resources function as “employee rela- tions.” In a union facility, the nomenclature is often involve an inordinate amount of time and resources, a company may consider entering into a neutrality agreement with the union which requires the company to remain neutral during the union’s organizing activities.*” A divided workforce can pose an extreme hardship on a healthcare facility, so an agreement to work co- operatively may be a good business decision. A company may also voluntarily recognize a union without an election, though under the current law, an election is the only way to be certified by the NLRB.«’ Why would a company enter into a neutral- ity agreement with or voluntarily recognize a union? There are several reasons. A plausible usually “labor relations.” This seemingly insig- scenario is one in which the company has a nificant difference actu- ally points out the most fundamental change a healthcare facility will experience when it goes from non-union to union – it stops deal- Once one facility becomes organized, then the union may very well seek to represent employees in other facilities. good working relation- ship with a union in a particular facility. A different union may be attempting to organize another facility. The company would rather ing directly with employees and begins deal- work with the union with which it is already ing indirectly with employees through a labor union. Thus, the relationship between individual employees and the employer is no longer the measuring stick for determining whether a company is a good employer. Instead, the re- lationship between the union and the company is the determinative factor. The unions’ interest is in all of the employees collectively, not each individual employee. Col- lective bargaining by its very nature involves negotiating the needs of the workforce as a whole. Instead of individual agreements with each employee, there is one contract that ap- plies to all of the employees in a bargaining unit. This is a fundamental change, particularly when the bargaining unit consists of physicians who often negotiate individual contracts with the employer. If your healthcare company operates multiple facilities, then you may discover that the union organization of one facility will have a ripple effect. Once one facility becomes organized. familiar. Also, the negotiating process may be shortened drastically if the company has one union to deal with as opposed to a different union at each facility or for each bargaining unit. The company may also simply want to avoid the cost of another campaign. The disciplinary system of the healthcare facility that has been unionized is the subject of mandatory bargaining.*^ Likewise, the law re- quires management and unions to bargain over a grievance process which nearly always results in a formal grievance procedure included in the collective bargaining agreement.” With respect to discipline of employees, the union will grieve disciplinary action taken against an employee if the union believes it is a viola- tion of the collective bargaining agreement. It is a fairly common practice in the healthcare industry for facilities to have internal griev- ance procedures in place whether or not the employees are represented by a union. In these facilities, employees who believe they have then the union may very well seek to represent received discipline either in a discriminatory 148 LABOR LAW JOURNAL manner or contrary to company policy may internally appeal the disciplinary decision through a grievance process. The peer review process is in some ways similar to a grievance proceeding in that a decision is reviewed to give it a sense of fairness. In a union setting, the concept is the same, but the mechanics differ. For example, it is the union that files the grievance on behalf of the employee. Thus, the company works with the union, not necessarily the employee, to resolve the dispute.*” The outcome of the negotiation is binding on the employee.*’ Note that for pub- lic sector employees, it may be permissible for employees to file a grievance directly with- out the presence of the union.** If the union and the company cannot reach an agreement, then most collective bargaining agreements require arbitration by a neutral third party of the dispute. Arbitration is also a mandatory subject of collective bargain- ing.” In a non-union facility, there is generally not a provision requiring third-party arbitration of dispute. In other words, once the internal appeal process is exhausted, the matter is over unless the employee files a legal claim against the employer. Management personnel in union facilities will have additional obligations that did not exist prior to the organization of the workforce. Obviously, if a union comes to your healthcare facility, then there will be significant changes in the function of the human resources depart- ment. You will have to employ human resources professionals who can effectively deal with the union representatives. The staff will have to know the collective bargaining agreement and understand the way in which it works. Likewise, the negotiation of a collective bargaining agree- ment will require a significant amount of time and resources. The company will need someone at the bargaining table that is intimately familiar with the company, the particular workforce and the industry. In addition to the changes in dealing with the workforce, unions may also bring political or social agendas to the A workforce on strike constitutes the most disruptive action for a business. In fact, one of the few provisions in a collective bargaining agreement that actually benefits an employer is a “no-strike” provision. States may prohibit public sector healthcare workers from striking.** In the private sector, healthcare workers may strike but there are some limitations. For example, the Labor Management Relations Act requires parties to a collective bargaining agreement to provide notice to the other.party of its intent to modify or terminate the contract 60 days before its expiration date. In the healthcare industry, the notice is extended to 90 days.*’ During this “cooling off” period, an economic strike is prohibited.'” For health- care workers, there is an additional cooling off period. The union must give the employer and the Federal Mediation and Conciliation Service at least ten days notice of its intent to strike.” This additional cooling off period applies to any work stoppage, not just a strike, including refusal to work overtime.” Hospitals in the Minneapolis-St. Paul area have recently felt the effects of a nurses’ strike. Nurses at the fourteen hospitals are represented by the Minnesota Nurses Association. Collec- tive bargaining agreements covering approxi- mately 12,000 nurses expired on June 1, 2010. A major issue in the negotiations is the nurse- to-patient staffing ratios. Thousands of the nurses participated in a one-day strike against the hospitals on June 10, 2010. The hospitals hired 2800 temporary nurses to fill in for the workers that day. Some hospitals rescheduled elective surgeries and took other measures to make up for the reduced labor force. On June 25, 2010, the union filed a strike notice indicating that its members had approved an open-ended strike beginning July 6, 2010 at six of the hospitals.” The parties reached an agreement, however, on July 1,2010, ending the bitter dispute and avoiding the biggest nursing strike in U.S. history.'” 149 UNIONS IN THE HEALTHCARE INDUSTRY In addition to the changes in dealing with the workforce, unions may also bring political or social agendas to the healthcare facility. Nurses unions in particular have certain platforms that reach beyond wages, hours and benefits. They promise to improve what is likely the number one concern for all nurses – patient care. As mentioned above, UAN, CNA, MNA and their recently-formed super union all support nationalized universal healthcare. Sometimes, patient care is directly related to nurse’s work- ing conditions and causes a difference of opin- ion among the nurses’ unions. A good example of this is patient ratios. Some nurses want strict ratios while others prefer staffing committees, and still others have a variety of opinions on the issue. It is quite understandable that with the varying opinions, the nurse’s unions differ on this point as well. For example, in Penn- sylvania, the CNA proposed and supported state legislation related to nurse-patient ratios and according to a CNA spokesperson, the Pennsylvania Nurses Association, an affiliate ofthe American Nurses Association (“ANA”), opposed the proposal as written.’^ Thus, the healthcare facility may get increasing pressure from the union to support its platform. If the employer and the union have different views (which is quite possible), then the tension be- tween the employees and the employer may be greater than in the non-union facility. In the non-union facility, the employees are free to support their causes, but such support is separate from their employment. In the union facility, the platforms of the workers may in- directly or even directly become a subject in the collective bargaining process between the employer and the union, such as the nurse-to- patient staff ratios in Minnesota. With a Democratic-controlled Congress and White House, unions will seek to organize healthcare workers like never before. Unions are businesses. Their revenue is generated by the dues paid by the members. If laws are in place to make it even easier for unions to organize workers, then it is a prime time to increase membership, and theref^ore, revenues. There are healthcare facilities and unions that have managed to work well together and reach palatable compromises. There are others that have not had such good fortune. There are lessons to learn from both, namely that col- lective bargaining is all about compromise. Perfect union contracts do not exist because individual needs and wants vary. If your healthcare facility finds itself on the other side of a union contract, remember that mutual respect is the key to successful negotiations and long-term relationships between unions and employers. • ENDNOTES See Butte Med. Prop., 168 NLRB 266 (1967). 29 U.S.C. §152(14). 29 U.S.C. §157. UFCW, Local 1036 v. NLRB, 307 F.3d 760, 764 n. 3 (9th Cir. 2002) (citing I Patrick Hardin, THE DEVELOPING LABOR LAW 448 (1992)). See NLRB v. Metro. Life Ins. Co., 380 U.S. 438 (1965). 29C.F.R. § IO3.3O(a) See Meijer, Inc. v. NLRB, 564 F.2d 737, 740, 96 LRRM 2738 (6th Cir 1977). I62LRRM 1329(1999). NY CLS Civ S §200 et seq. NYCLSavS§20l(6)(a) 29 U.S.C. §152(3). 29 U.S.C. §152(11) NLRB V. Health Care & Retirement Corp., 511 U.S. S7I (1994). NLBR V. Kentucky River Community Care, Inc., 532 U.S. 706(2001). Id. at 714. Oakwood Healthcare, Inc., 348 NLRB 686, 180 LRRM 1257(2006). Id. at 694. Id. An employer may voluntary recognize a union, but ordinarily, the employer recognizes the union only after the election process described herein. 29 U.S.C. I59(a). NLRB Statements of Procedure §101.21 Lincoln Park Zoological Soc’y v. NLRB, 116 F.3d 216, 219 (7* Cir 1997). 29 U.S.C. §l59(e). Id. H.R. 1409, S. 560 Labor Relations Expediter (Analysis), “Employee Free Choice Act – Pending Legislation,” Labor and Employment Law Library, The Bureau of National Affairs. Id. 83 Daily Labor Report C-l, May 4, 2009 (The Bureau of National Affairs) 29 U.S.C. § IS8(a)(l) and 158 (b)(l)(A) Children’s Center for Behavioral Dev., 347 NLRB 35(2006) Airport 2000 Concessions, LLC, 346 NLRB 958 (2006) NLRB V. Savair Manufacturing Co, 414 U.S. 270 (1973) See Leiser Construction, LLC, 349 NLRB 413 (2007) GrenadaStampingand Assembly, Inc., 351 NLRB 1152(2007) Valerie Manor, Inc., 351 NLRB 1306 (2007) See Ivy Steel and Wire, Inc., 346 NLRB 404 (2006) See Kingsbridge Heights Rehab. Care Center, 352 NLRB 6 (2008) Republic Aviation v. NLRB, 324 U.S. 793,803-04 (1945): see also. Airport 2000 Concessions, LLC, 346 NLRB 958 (2006) PPG Industries, Inc., 350 NLRB 225 (2007) See Randell Warehouse of Arizona, 347 NLRB 591 (2006) Downtown Hartford YMCA, 349 NLRB 960 (2007): See also Baptista’s Bakery, Inc., 352 NLRB 547 (2008) Douglas E. Ray et al.. Understanding Labor Law (2d ed 2005). Id. Publix Super Markets, Inc., 347 NLRB 1434 (2006) ISO LABOR LAW JOURNAL Douglas E. Ray et al.. Understanding Labor Law (2d ed 2005). Id. Tecumseh Packaging Solutions, 352 NLRB 694 (2008) Guard Publishing Co. v. NLRB, 571 F.3d 53 (D.C. Cir. 2009) Beth Israel Hospital v. NLRB, 437 U.S. 483 (1978); NLRB v. Baptist Hospital, Inc., 442 U.S. 773(1979). See NLRB v. Babcock and Wilcox Co., 351 U.S. 105(1956) 29 U.S.C. §l59(a). Id. Id. Labor Relations Expediter (Analysis), “Employee Free Choice Act – Pending Legislation,” Labor and Employment Law Library, The Bureau of National Affairs. H.R. 1409; Id. 31 Daily Labor Report AA-1, February 19,2009 (The Bureau of National Affairs) Id.; 233 Daily Labor Report B-l, December 8, 2009 (The Bureau of National Affairs) http://www.uannurse.org/documents/National- NursesUnitedFAQ.doc; see also 223 Daily Labor Report B-l, December 8, 2009 (the Bureau of National Affairs) Id. http://www.medical news today.com/ar- ticles/ 161698.php; http://www.nationalnurse- sunited.org/about/; 90 Daily Labor Report A-13, May 12, 2010 (The Bureau of National Affairs) 71 Daily Labor Report A-12, April 16,2009 (The Bureau of National Affairs) Id. Id. http://www.nysna.org/images/pdfs/nfn/NFN_ lntroduction.pdf Id. 52 Daily Labor Report A-l, March 20, 2009 (The Bureau of National Affairs); www.SEIU. org/ourunion www.SEIU.org/ourunion www.calnurses.org/media-center/press-releases Id. www.boston.com/business/arti- cles/2009/03/19 www.calnurses.org/media-center/press-releas- es Formed on January I, 1995, the SEIU United Healthcare Workers-West is the largest health- care union in the western united States and a local affiliate of the SEIU. http://www.nuhw.org/about/ Id. Id. http://www.nlrb.gov/about_us/overview/board/ wilma_b_liebman.aspx htpp://www.nlrb.gov/about_us-overview/board/ index.aspx http://www.nlrb.gov/about_us/overview/board/ peter_c_schaumber.aspx http://www.calnurses.org/media-center/in-the- news/2009 http://www.deiu.org/2009/05/seiu-announces- unprecedented-coalition-to-sav-2-trillion-in- healthcare-costs-pass-obama-healthcare.php SeeAK Steel Corp. v. United Steel Work- ers of Am.. 163 F.3d 403, 160 LRRM 2065 (6th Cir. 1998). See Gen. Box Co., 82 N.L.R.B. 678, 23 LRRM 1589(1949). 29 U.S.C. §l58(d) See U.S. Gypsum Co.. 94 N.L.R.B. 112, 28 LRRM 1015(1951). See Plumbers & Pipefitters Local 520 v. NLRB, 955 F.2d 744, 139 LRRM 2457 (D.C. Cir. 1992). See Id. Smith V. Ark. State Highway Employees, 441 U.S. 463, 101 LRRM 2091 (1979). Wire Prods. Mfg. Corp., 329 N.L.R.B. 155, 165 LRRM 1014(1999). NY CLS Civ S §200. 29 U.S.C. §l58(d) See Mastro Plastics Corp. v. NLRB. 350 U.S. 270, 37 LRRM 2584 (1956). 29U.S.C. §l58(g) N.Y. State Nurses Ass’n, 334 N.L.R.B. 798, 167 LRRM 1313 (2001). 122 Daily Labor Report A-IO,June 28,2010 (The Bureau of National Affairs) http://www.startribune.com/lifestyle/ health/97611569.html (July 2, 2010) 71 Daily Labor Report A-12, April 16,2009 (The Bureau of National Affairs) ISI Copyright of Labor Law Journal is the property of CCH Incorporated and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder’s express written permission. However, users may print, download, or email articles for individual use.

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