April 30, 2012 Effective Date Still Applies
On March 2, 2012, a federal district court in Washington, D.C., ruled that the National Labor Relations Board had the authority to issue the notice posting rule that will require most private sector employers to post a notification of employee rights under federal labor law. The court rejected arguments made by several employer groups seeking to block the notice posting rule before its April 30, 2012 effective date. (Nat'l Ass'n of Mfrs. v. NLRB, D.D.C., No. 11-cv-1629). But the court also ruled that the NLRB does not have the authority to deem a failure to post the notice to automatically constitute an unfair labor practice or to extend the statute of limitations for unfair labor practices. This means that the NLRB will begin enforcing the notice posting requirement on April 30, 2012.
The Rule
As we discussed in prior alerts, the NLRB's notice posting rule requires employers to post an 11-inch-by-17-inch notice form describing employees' labor law rights in all places where notices to employees customarily are published, and to publish the notice on an intranet or Internet site if the employer customarily uses the Internet or an intranet to communicate with employees about employment rules and policies.
The Decision
The district court concluded that the National Labor Relations Act provides the board a "broad, express grant of rulemaking authority," and rejected claims that the NLRB's decision to require the posting was arbitrary and capricious.
But the court did find that two portions of the rule could not be enforced by the NLRB. The court ruled that the NLRB exceeded its statutory authority in promulgating a provision that would treat any failure to post the required notice as an unfair labor practice under the Act. And it also held that a provision tolling the NLRA's statute of limitations in any case at a jobsite where an employer failed to post the mandated notice was inconsistent with the language of the statute.
What the Ruling Means
We expect the employer groups that brought the lawsuit to appeal, but we don't expect that the appeal will be decided before April 30, 2012. Even though there is one other lawsuit pending, it appears that the effective date of April 30, 2012 will stand.
Employers should know that the district court's conclusion that the NLRB exceeded its authority by deeming any failure to post the notice to be an unfair labor practice does not mean that the risk of sanctions is absent. The court stated that its ruling did not prevent the NLRB from making "individualized determinations" that an employer's failure to post the notice violates the NLRA. NLRB Chairman Mark Pearce already issued a statement that he is pleased that the court "recognized [that the NLRB] can find, on a case-by-case basis, that an employer's failure to post the notice is an unfair labor practice." Employers can expect the NLRB to use that authority and attempt to show that a failure to post the notice interferes with employees' rights and is an unfair labor practice. Given the court's split decision, employers should seek advice as to compliance with the posting requirement in light of the decision.
Who Must Comply and How to Comply
The posting requirement applies to all employers within the jurisdiction of the NLRB. This includes virtually all private sector employers, including small employers. There is no minimum number of employees necessary for an employer to be subject to the posting requirement. Rather, whether an employer is subject to the posting requirement depends on the amount of goods sold or services provided by the employer out of state ("outflow") or purchased by the employer from out of state ("inflow"). Outflow or inflow can be direct or "indirect," passing through a third company, such as a supplier. The Board generally takes jurisdiction when annual inflow or outflow is at least $50,000.
The NLRB has stated that it believes the great majority of the country's nearly six million small businesses will be subject to the posting requirement. Effectively, only very small employers whose business (both purchases and sales) occurs entirely within one state are exempt from NLRB jurisdiction and the posting requirement. Employers that are unsure about whether they are subject to the posting requirement should seek legal counsel.
Copies of the notice are available from the NLRB's Regional Offices (you can find the addresses at www.nlrb.gov/who-we-are/Regional-Offices), and a copy of the notice can be downloaded from the NLRB's website at www.nlrb.gov/poster. The downloaded notice can be printed out on two 8.5" x 11" sheets of paper. You may also purchase the poster from a commercial vendor of employer notices to employees.
Again, employers that post employment rules on an intranet or Internet must post the notice on such sites. Employers do not need to send the notice to employees by e-mail.
We will continue to keep you updated on this NLRB regulation.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
