President Obama's National Labor Relations Board (NLRB)
again demonstrated its aggressive, pro-union tendencies when the
Board's General Counsel recently filed a Complaint seeking to
force Boeing to move work from its recently built non-union South
Carolina facility to Boeing's union-represented employees in
Washington State. In a letter dated May 4, 2011, Boeing asked the
NLRB to withdraw its Complaint based on "misstatements"
and misquotes attributed to company executives contained in the
NLRB's Complaint. On the same day, Boeing filed an Answer
denying the Complaint's allegations. The battle lines in this
significant labor dispute have been drawn.
Boeing maintains substantial operations in Washington State and its
Washington-based employees are largely unionized. After a strike in
2008 and after talks between the company and the union faltered in
late 2009, Boeing announced plans for a new production
line/facility in South Carolina. In response, the International
Association of Machinists and Aerospace Workers union that
represents many of Boeing's Washington employees filed a unfair
labor practice charge against the company, alleging Boeing's
decision to place its new production line in South Carolina
violated Sections 8(a)(1) and 8(a)(3) of the National Labor
Relations Act (NLRA). Specifically, the union alleged Boeing's
decision was in retaliation for the strikes and labor instability
Boeing had been subjected to in Washington.
Boeing's Answer denies the NLRB's allegations and asserts a
number of defenses. First, Boeing asserts that the statements
alleged in the Complaint are protected under Section 8(c) of the
NLRA, which reinforces the First Amendment's constitutional
protection for free speech. Second, Boeing asserts its decision was
based on numerous business-related factors having nothing to do
with anticipated future labor unrest, such as South Carolina's
favorable business environment, significant financial incentives,
and a desire to achieve geographic diversity and stability for its
operations, and that it would have made the same decision even if
it had not taken the possibility of future labor strikes into
consideration. Boeing also asserts that even if its decision was
based on a desire to mitigate the adverse economic impact of future
labor strife, to do so was not inherently destructive of protected
employee rights under the NLRA. Finally, Boeing claims the remedy
requested by the NLRB is impermissibly punitive and retroactive
representing an unanticipated departure from NLRB and court
precedent.
Prior NLRB decisions related to alleged employer retaliation have
not involved fact patterns and situations such as a company's
business decision to maintain its current operations but also open
a new facility for new production in another locale. As such, this
case is an attempt to significantly expand that theory and the
reach of the NLRB into core company business decisions.
This case also has created competing political rhetoric between
union supporters and the "Right to Work" movement. South
Carolina is a "Right to Work" state, which means
employees cannot be required to pay any union dues to retain their
jobs. According to Sen. Lindsey Graham, R-SC, the NLRB's
Complaint is seeking to "punish right-to-work states that
value and promote their pro-business climates," and he has
promised to fight "this outrageous decision by the NLRB -
unelected bureaucrats that have put in motion a precedent that will
destroy American businesses."
The allegations against Boeing, especially in conjunction with the
severity of the proposed remedy, are startling. Boeing has already
spent $2 billion on its new South Carolina facility, and the
facility would create approximately 1,000 new jobs. An adverse
ruling against Boeing would likely "shutter" this
facility after the fact. According to former Board member Peter
Schaumber, who served from 2002 until 2010, "there is no
precedent to support this" and "[i]f this is a violation
of the law, then there is something wrong with American labor
law." Needless to say, employers must be cognizant of the
aggressive and pro-union positions being espoused by the NLRB and
consider their potential impact on significant business
decisions.
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