Hunton Employment & Labor Perspectives

Employers who thought the hotly contested issue of card check recognition had been side-lined along with EFCA should take notice of a recent decision announced by the National Labor Relations Board (the “Board”).  As predicted earlier in light of its new composition, the Board has begun to lay the groundwork to overturn established precedent giving employees the right to demand a secret ballot election in the face of voluntary card-based union recognition.

In the recently issued decision, consolidated cases Rite Aid Store #6473 and Lamons Gasket Company, 355 NLRB 157 (2010), the Board announced that it will revisit its holding in Dana Corp., 351 NLRB 434 (2007).  In Dana, the Board acknowledged the need to protect employees’ freedom of choice and established an employee’s right to challenge immediately their employer’s voluntary card-based union recognition by demanding a secret ballot election.  Specifically, the Board held in Dana that when an employer voluntarily recognizes a union based on card-check, it must post a notice advising its employees that they have the right to file a petition for an election to decertify the union or in support of a rival union within 45 days of the notice.  Prior to Dana, an employer’s voluntary card-based recognition of a union barred an election petition filed by an employee or a rival union for a “reasonable period of time,” which could be up to one year (or up to 3 years in the event a collective bargaining contract had been reached).

The Board in Rite Aid and Lamons Gasket  found “substantial issues concerning voluntary recognition arising under the Board’s decision in Dana.”  The Board also issued a Notice and Invitation to File Briefs, inviting interested parties to file briefs by November 1, 2010, to address “the issues raised in these cases, including whether the Board should modify or overrule Dana.”  Specifically, the Board stated that parties and amici should answer some or all of the following questions in their briefs:

(1) What has been their experience under Dana and what have other parties to voluntary recognition agreements experienced under Dana?
(2) In what ways has the application of Dana furthered or hindered employees’ choice of whether to be represented?
(3) In what ways has the application of Dana destabilized or furthered collective bargaining? (4) What is the appropriate scope of application of the rule announced in Dana, specifically, should the rule apply in situations governed by the Board’s decision regarding after-acquired clauses in Kroger Co., 219 NLRB 388 (1975), or in mergers such as the one presented in Green-Wood Cemetery, 280 NLRB 1359 (1986)?
(5) Under what circumstances should substantial compliance be sufficient to satisfy the notice-posting requirements established in Dana?
(6) If the Board modifies or overrules Dana, should it do so retroactively or prospectively only?

The Board further invited the parties and amici to “submit empirical data and factual descriptions of their experience under Dana.”  However, the dissent, consisting of Members Schaumber and Hayes, argued that the Board already possesses the only relevant, and also telling, empirical evidence.  The dissent noted that since the Board’s decision in Dana, the Agency has received 1,111 requests for voluntary recognition, resulting in 54 secret ballot elections.  In approximately 25% of these elections, the employees have voted to reject the union.  Citing these statistics, the dissent asserted that “Dana has served its purpose of protecting employees’ free choice without discouraging voluntary recognition or the overall process of collective bargaining.”  The dissent further predicted that the Board’s action in Rite Aid and Lamons Gasket  is a “prelude to what will most likely result in the overruling of Dana, in derogation of employees’ Section 7 free choice rights.”