Labor Law Blog Essay

Trump-Appointed Labor Board’s Impatient Agenda to Reformulate Labor Law

Congress framed the National Labor Relations Act in 1935, during a period of confidence in the administrative state, using broad language and excluding a private right of action. The Labor Act thereby delegated significant authority to the National Labor Relations Board to formulate doctrine that would encourage “the practice and procedure” of effective and peaceful collective bargaining. The passage of the Taft-Hartley amendments to the Act in 1947 augmented the Board’s authority by confirming a right of employees to choose to refrain from collective bargaining and by prohibiting certain union as well as employer conduct that could interfere with that choice. The 1947 amendments thereby gave warrant to balance a sometimes conflicting goal of employee free choice to any Board members less enthusiastic about the benefits of collective bargaining. Not surprisingly, each subsequent change in the party affiliation of a President with power to appoint new Labor Board members thus has brought a shift in labor law principles.  In each instance of political change before the most recent Presidential election, however, a new Labor Board effected the shift gradually in reaction to issues necessarily presented and focused by the facts of cases before the Board. The Labor Board appointed by President Trump, by contrast, has not been content with this gradual common law-type reactive process.

Each new Republican administration, from Eisenhower’s to Nixon’s to Reagan’s to that of Bush fils, brought new doctrine more favorable to managements resistant to collective bargaining; and each new Democratic administration, from Kennedy’s to Carter’s to Clinton’s to Obama’s, resulted in doctrine more supportive of unions’ efforts to achieve and maintain bargaining status. In each case, the shift occurred gradually through the use of adjudicatory lawmaking in cases presenting particular facts requiring the application vel non of old doctrine, rather than by new regulations promulgated through the formal rulemaking procedures of the Administrative Procedure Act. This preference for adjudication existed despite the NLRA’s express grant of substantive rulemaking authority to the Board.

Like prior Boards after a shift in the President’s party affiliation, President Trump’s Board has used adjudications to reformulate law favorably to management across a range of issues. Some of this reformulation — such as an important decision on July 3, enabling employers to revoke a union’s bargaining authority in anticipation of a collective agreement’s expiration — can be described as reactive to the facts of cases the Trump Board could not treat as they wished under the old doctrine.  

In these cases, the new balance struck by the Trump Board was a necessary part of its holding, rather than merely abstract dicta. In other cases, however, the Trump Board has reached out to articulate new doctrine when it could have reached the same result in the case without doing so.

A prominent example of the latter proactive adjudicatory impatience was the Trump-appointed Board’s attempted retrieval of earlier Republican Boards’ doctrinal language governing the assignment of joint employer status and consequent bargaining obligations. President Obama’s Board had rejected this language because of its potential impediment of a union’s effective bargaining with a business with actual control of wages and conditions of employment.

Primarily because the rejection of this ambiguous language had become worrisome to many employers, especially those using franchising, however, the business community pushed for legislative change.

With the legislative change stymied, the Trump Board, not content to wait for a case in which the Obama Board’s rejection of the Republican Board’s language mattered, reached out to jettison the Obama Board’s reformulation through unnecessary dicta in a case that would have been decided the same way under any formulation, and in fact did not even present a real issue of joint employment.  

The Trump Board’s drive to assert doctrine governing joint employment, moreover, provides an additional demonstration of its unprecedented impatience to change labor law. When its decision containing the dicta on joint employment doctrine had to be revoked because of a conflict-of-interest of one of the Board members, the Board pivoted to rulemaking to attempt to reinstate the earlier Republican Boards’ language.

This use of rulemaking — rather than common law-type adjudication in the context of particular facts — to define an ambiguous term in the NLRA was unprecedented.  The only substantive rule promulgated by the Labor Board in the twentieth century concerned the appropriate units for collective bargaining in acute care hospitals. The Board appointed by President Obama attempted two rulemakings, but the only one that was successful concerned the Board’s own procedures for conducting elections for certifying employee support in appropriate unions.

The Board’s attempt to define a statutory term through an expensive and lengthy rulemaking process may not be successful. The Board proposed its joint employer rule on September 14, 2018, received 29,000 comments for processing, and has not indicated when it anticipates promulgation of a final rule. Moreover, in a December, 2018 opinion reviewing the Obama Board decision that upset the business community, a panel of the District of Columbia Court of Appeals, relying on strong precedent from the Supreme Court, stressed that Congress intended the definition of the employment relationship covered by the NLRA to be drawn from the common law, not formulated by Board-created doctrine owed judicial deference.

Nonetheless, the Board indicated in a press release on May 22, 2019, that it intends to do further substantive rulemaking on particular important issues rather than wait for cases whose facts provide context for the reformulation of law.

Most of the issues flagged for future rulemaking concern rules for regulating processes for the formation or discontinuation of a union’s representational status. The selection of these issues makes evident the Trump Board’s management-friendly agenda to further rebalance the Taft-Hartley scales in favor of management prerogatives and shifting employee sentiments rather than the encouragement of the effective collective bargaining envisioned by the Labor Act in its original statement of purpose. One of the issues selected for rulemaking in this press release, the “standard for determining whether students who perform services at private colleges or universities in connection with their studies” are employees covered by the Act, is particularly revealing of the Board’s impatience. In three decisions since 2000, Democratic and Republican Boards have taken shifting positions on whether the Act secures organizational and collective bargaining rights for graduate students who are compensated for instructing undergraduates.

Since the election of President Trump, unions supported as representatives by graduate students at private universities subject to the Act have not invoked the Board processes or protections, apparently fearing a new decision again denying coverage of graduate students and a possible erosion of collective bargaining in other graduate student units. The Trump Board’s announcement of possible rulemaking on the issue bespeaks its impatient reaction and its willingness to aggressively advance its agenda.

Unlike past Boards’ acceptance of gradual change through fact-based adjudications, Trump’s Board is striving to make law on the fastest schedule possible.