Specifically, the new poster includes updated information on the ADA Amendments, some updated DOL language, and information on the new Genetic Information Nondiscrimination Act (GINA) which goes into effect November 21. 

The EEOC website has information on ordering new posters, but also has a downloadable version of the new poster, and a downloadable supplement to the 2002 poster, if you’ve got a glossy version of that one that you want to keep up. 

Go download one of these two notices and put a pushpin in it.  Not only will it keep you in compliance, but your employees notice when things like that change, and it makes you look like you’re thinking about their rights.  (That’s a good thing.)

It has been that way for many years, and while the body of decisions by the IELRB grows, it’s you’d think that the jurisdiction of the Board is rarely questioned.  Schools are in, everyone else is out. 

Of course, no issue of labor & employment law is ever really settled.  Even whether schools are within the jurisdiction of the Education Labor Relations Board.

When is a School a School?

A union in Kane County filed with the IELRB to acknowledge majority representation of the teachers of a charter school, and the Board certified the union.  The school took issue, arguing that the IELRB does not have jurisdiction over charter schools because they’re not “educational employers” as defined by the IELRA.  The Board disagreed, and the school appealed.

The school’s argument was that the Charter School Act exempts charter schools from “other [s]tate laws and regulations under the School Code”, and that this exemption included the Education Labor Relation Act.  The union countered that the IELRA was not an education law, but rather a law about how an employer that happened to be a school dealt with its employees.

The Fourth District Appellate Court sided with the school.  The court separated the phrase excluding charter schools from certain state laws into two interesting parts:  “other state laws” and “regulations under the School Code”.  The court pointed to non-education laws that are specifically mentioned in the Charter Schools Act, saying that the legislature clearly did not want to limit the exlusions to education-related laws:

…to conclude that charter schools are not exempt from the Education Labor Act would be to assume the legislature overlooked the Education Labor Act when it drafted the list of specific exceptions. We reject this assumption and conclude that the omission of the Education Labor Act from the list of specified exceptions is not somehow a legislative oversight.

Questions of Intent

The court’s opinion notes that both sides, along with numerous other interested parties, wrote briefs analyzing the legislature’s intent in drafting and passing (or opposing) the Charter School Act, as a way of proving that the schools should or shouldn’t be under the Board’s purview.  The court did a decent job of sidestepping the political issue inherent in that discussion by holding that the statute was plainly written, and refusing to consider what the intent of specific legislators was in drafting it.

A Moot Point?

The court’s opinion ends with a note that a recent legislative change specifically states that charter schools are “educational employers”.  The law isn’t in effect until next year, though, so the court said it couldn’t apply to the case before the court.  Nonetheless, it seems that one major difference between charter schools and typical public schools – the lack of unionized teachers - may be in flux in the coming years. 

At the very least, it looks like next year we won’t be questioning whether schools are under the jurisdiction of the IELRB.

Original photo by eye2eye (flickr)

The Workplace Prof Blog tipped off this story in the National Law Journal about the ongoing litigation between three former law professors at the Ave Maria School of Law and the school’s founder and financier, Tom Monaghan (the Domino’s guy).

The lawsuit has been going on for over two years now, with the professors claiming they were fired for voicing concerns over the legality of uprooting and moving the ABA-accredited school to Florida.

Now Monaghan has filed a motion to dismiss the case using what some see as a novel approach.  From the NLJ:

In the latest twist to the two-year-old suit… Monaghan… filed a motion last month claiming that the law professors are “ministerial.” Therefore, he argues, because the school is a religious institution, the administration over these minister-professors is exempt from civil trial court under the “Establishment and Free Exercise of religious clauses of the First Amendment.”

Monaghan also claims that the institution is eligible for “ecclesiastical abstention,” requiring courts to “abstain from inquiring into, or interfering with, governance of the religious institution.”

Seems crazy, right?  You’d think there’d be no support for a position like that, but it turns out that in cases where professors – law schools included – are actual ministerial employees, ecclesiastical abstention has been a decent defense.  The NLJ article mentions McDonough v. the Catholic University of America (83 F.3d 455 (D.C. Cir. 1996)) - where a nun/law professor’s sex discrimination case was thrown out as a ministerial matter outside of the court’s purview.  And Monaghan’s motion points to various sections of the Catholic canonical law regarding treatment of university faculty as a sign that the courts should stay away.

The difference here, of course, is that none of the professor plaintiffs are actual clergy.  Instead, Monaghan argues that if their jobs require them to address some theological issues related to their specialty (which Canonical law requires), they are ministers enough for the court to abstain from hearing the case. 

The McDonough court framed the ministerial exemption pretty broadly, actually:

[T]his circuit and a number of others have long held that the Free Exercise Clause exempts the selection of clergy from Title VII and similar statutes and, as a consequence, precludes civil courts from adjudicating employment discrimination suits by ministers against the church or religious institution employing them.

***

The ministerial exception has not been limited to members of the clergy. It has also been applied to lay employees of religious institutions whose “primary duties consist of teaching, spreading the faith, church governance, supervision of a religious order, or supervision or participation in religious ritual and worship….”  If their positions are “important to the spiritual and pastoral mission of the church,” they “should be considered ‘clergy.’”

(Citations Omitted)

Everything I’ve read about the motion sort of frames it as a bizarre stalling tactic (the attorneys for the professors certainly thinks it is), but if the standard in McDonough is applied, then I think Ave Maria at least has a solid argument here.

Here is Mr. Rose’s response:

You are right, The Los Angeles Police Protective League raised some eyebrows across the state by calling for replacement of the editorial staff of the San Diego Union -Tribune. Who is a law enforcement labor organization to ask for such an action, and why did they ask for it?

First, like so many police officers, the men and women of the Los Angeles Police and Fire Departments are now part owners of the San Diego Union-Tribune by virtue of the investment of $35 million of their retirement dollars into Platinum Equity, the private equity fund which bought the Union-Tribune. They joined other public employees such as school teachers in Pennsylvania, Louisiana and New Mexico in providing the investment capital for Platinum Equity.

The Union-Tribune Editorial Board is one of the most vociferous anti-public employee pages in the State. A prime example is its near weekly attempt to lay all financial woes in the state at the feet of public employees with little regard for the facts. A case in point is the current issue with respect to pension funding.

Never once does the editorial page mention that a main cause of pension fund shortfalls across the state was the failure by public entities to make annual required contributions to their pension funds. The diverted funds were used for other projects, depriving pension funds of money when the stock market was rising and the money invested with the most impact.

Take the City of San Diego as an example. The Union-Tribune’s own staff reporters (not its opinion writers) found the problems began in 1996, when instead of contributing to the pension fund, money was diverted to pay for the costs of the 1996 Republican National Convention and expanding Qualcomm Stadium. An independent auditor wrote that City officials encouraged reducing the “flow of money to the City’s pension system in order to benefit the City while creating no compensating benefit for the City Pension system.”

Where was the “watchdog” Union-Tribune Editorial Board when these shenanigans were going down? Partying like there was no tomorrow. The Union-Tribune’s $500,000 party on San Diego Bay during the Republican Convention is still remembered as a highlight of the event. Strangely, no editorials were written questioning the wisdom of diverting pension fund money to subsidize the Convention’s cost.

Likewise, nary a word was heard from the Union-Tribune’s Editorial Board when in the late 1990′s the County of San Diego went nearly six years without making a payment, over a full payment to the contribution system. Nor were there concerned editorials when during the same time period the State, as well as numerous cities and counties, went four years without making annual contributions to CALPERS—or when starting in 1990, the State went 18 years without paying any money into the UC pension system.

No, in the eyes of the current Editorial Board, it is only “overpaid” police officers, fire fighters, teachers and other public employees who are responsible. Real solutions will require all of us to work together. America is the greatest nation on earth and has overcome two world wars, financial depressions, and countless other challenges with our greatest assets-our willingness to work together and our ingenuity.

The editorial position of the Union-Tribune fairly represented the views of its owners prior to the purchase by Platinum Equity. It’s repeated bashing of police officers, firefighters, teachers and other public employees doesn’t represent the views of its current owners. And, if you think that editorial pages don’t reflect the views of their owners—-how many editorials have the Times written critical of Sam Zell and the ripple effects from his financial problems after he bought the Times?

Public safety employees will not tolerate the continued attacks of our dutiful law enforcement, firefighters and teachers who have invested their lives and in some cases given their lives in serving our communities. As investors in Platinum Equity, it is our responsibility to uphold the promises we have made to our various members and vigilantly protect them from undue attacks.

It is obvious that their constant criticisms and abhorrence of public employees will continue and, they have no intent to be part of the solution. It is for these reasons that the LAPPL on behalf of the public safety community asked the leaders of Platinum Equity to replace the editorial staff of the Union-Tribune with people who will offer balanced, well reasoned, and solution orientated pieces.

CE obviously doesn’t have a dog in this hunt, but if you want to take sides on any of the myriad issues here (free press, union/equity ownership, etc.), feel free to have it out in the comments.

by allaboutgeorge (flickr)

Last week, I posted a summary of a LERA presentation on the benefits of private equity firms using labor pension funds to invest in struggling businesses. 

One of the upshots discussed at the lunch was that the pension funds had greater control over the use of their investments. 

Instead of just being a faceless, unimportant investor, the fund’s money would be used to direct an individual business’s trajectory, making it a win-win for the union.  The pension money grows, and the investment advances the agenda of the union.

At least one union is stretching the limits of that theory. 

Earlier this month, the Beverly-Hills-based private equity group Platinum Equity bought the struggling San Diego Union-Tribune for an undisclosed amount.  Usually, what happens after that is that the private firm just reorganizes or breaks up the company, and then sells it for a profit, which satisfies its investors. 

In this case, though, the Los Angeles Police and Fire Pension System has upwards of $30 million invested in Platinum, and one of the unions contributing to that pension fund, the Los Angeles Police Protective League, wants a little more for its money than double-digit ROI .  From the San Diego News Network:

[T]he union that represents Los Angeles police officers is demanding the ouster of the newspaper’s editorial page staff….

In a letter to Platinum Equity Chief Executive Tom Gores, Los Angeles Police Protective League President Paul M. Weber said the Los Angeles Police and Fire Pension system is now a Union-Tribune part-owner because of its $30 million investment in Platinum.

The union is complaining about editorials in the Union-Tribune that have repeatedly criticized the amount of money going into San Diego’s public employee pension plans.  The union says that it’s investment makes it part owner of the paper, and therefore the editorials are out of line, and the staff should be replaced.

How exactly one contributor of one investor of the company that eventually bought the newspaper becomes part owner is sort of lost on me.  And, apparently, on Platinum:

In a recent interview with the Union-Tribune, a Platinum executive indicated that the union was wasting its time because Platinum has no editorial agenda.

But the union does make one interesting point.  This idea of “control” is a selling point for the private equity funds.  The news story has the following quote from the union’s letter to Platinum:

“When you went to pension funds seeking their investment dollars, you promised to invest that money for the benefit of those funds and their members…  One way you can fulfil that promise is to dismiss the Editorial Staff of the San Diego Union-Tribune.”

In this case, of course, the argument is meaningless because the union isn’t the investor, the pension fund is.  But if a pension fund decided to get militant, who would be the final decisionmaker?  The private equity fund, for sure.  That’s why we separate funds from their beneficiaries – so fiduciaries can focus on the greater financial good, without getting bogged down in principle and moral directives. 

But that makes the private equity funds’ “control” selling point a fallacy from the start, right?

by reiner.kraft (flickr)

A Quick test:  When you think of unions and New York City, what comes to mind?  I’m guessing it’s not slim cardigans, GQ-worthy suits and adult-sized under-oos. 

Well, shows what you know.  As the New York Times reported, over 1,000 NYC employees of the international, high-fashion-low-cost retailer H&M are going to work today under a union contract that will raise their hourly pay and place restrictions on the company’s ability to change schedules at the last minute.   

The H&M workers actually voted for representation by the Retail, Wholesale & Department Store Union back in November of 2007; their first contract was ratified on May 20th of this year.  According to the RWDSU’s press release, the new 3-year contract promises a 3% wage increase this year, with reopeners on wages for years 2 and 3, and allows for annual, merit-based increases. 

The contract also guarantees that employees will know their schedules at least a week in advance – a provision that should make anyone who’s grunted through a mall job jealous.  Frank Bail, the President of RWDSU local 1102 pointed out that over-flexibility in weekly schedules can be difficult for some employees with young children. 

It’s unlikely that the H&M contract is a sign of big changes in the labor movement.  I can’t see midwestern malls being taken over by organizing campaigns in the near future.  But in urban areas like New York, Chicago and L.A., the workers at these places are probably more insulated and the turnover rates are lower (well, maybe not in L.A.).  Plus, the close proximity of multiple storefronts could create a large enough worker base for organizing to be worthwhile.  It’s something retail employers in major metropolitan areas should at least consider.

For now, it seems like NYC union workers are going to have to think a little harder about what they wear to the hall.  Skinny up those jeans, and swap that hard hat for a trilby.  And remember, it’s summer, so no felt - straw is much more breathable for your scalp.

Cat dog bed by Jon Åslund (Flickr)

Some unions in troubled companies are finding an unlikely source of salvation and partnership: private equity. 

Yesterday, the Chicago Chapter of LERA invited Steve Sleigh, a member of the private equity group Yucaipa Companies, to discuss the current state of labor and capital.  Sleigh admitted that private equity is most often associated with greedy takeovers,  where the investor comes in to sell off profitable pieces of a foundering company, instituting layoffs and forcing concessions from unions.  Increasingly, private equity is the third seat at the table of industrial relations, and disliking its interference is sometimes the only thing unions and management can agree on. 

But it doesn’t have to be that way, according to Sleigh.  Yucaipa occupies a unique position in the private equity arena: their partners come from backgrounds in all three camps – labor, management and finance, and their focus is on companies with unionized workforces and a solid product.  The investments come in large part from multi-employer pension funds, which means the private equity group essentially becomes a conduit for unions to reinvest in the labor movement.

Like most private equity investors, Yucaipa buys companies in hopes of retooling them and selling them.  But Sleigh thinks that the prevailing model of reducing payroll and benefits in order to accomplish the quick turnaround is short-sighted.  Instead, Yucaipa starts its analysis by assuming that the labor costs are fixed, and then asks what else at the company can be adjusted. 

In one example, a large, Midwestern cold storage company had each of its locations making individual contracts and operating decisions.  Every facility had its own IT contracts, its own practices and guidelines.  “They had 120 fiefdoms,” Sleigh said.  By consolidating operating decisions, the company was made profitable with no loss of employment or benefits.

The secret, according to Sleigh, is in getting labor and management to focus on the good of the company together.  “We often say that we’re mediators with money,” he said.  By the time a company is failing, though, the two sides are often either giving up or at each other’s throats.  ”My number one question is always: Who cares about the firm?”  The number one answer, Sleigh said, is usually the workers – not just because they want to keep their jobs, but because longstanding workforces develop senses of community that will be lost if a company is grossly restructured or closed.  By working with the unions – and having partners with history in labor organizations – Yucaipa can get early information on issues like cash flow and productivity that guide its investment decisions. 

Sleigh also pointed out one of the key areas where companies get into trouble with their unionized workforces: lack of transparency.  Sleigh said that, during a restructuring, they require annual presentations to both management and union representatives on the health of the company.  That way, no matter what changes are needed during the turnaround, they’re not a shock to anyone.  Putting unions and management on the same informational page also fosters cooperation between the parties, according to Sleigh. 

Here, though, Sleigh said unions presented the biggest obstacle.   Often, the union doesn’t have anyone to represent them who truly understands the financials.  He said unions needed to start thinking of themselves as partners in the process.

It seems there would be some inherent conflicts in using private equity – with union pension fund backing – to restructure unionized workforces.  First, what happens when a company won’t survive unless pension benefits are cut, or a defined benefit plan has to be changed to a contribution-based plan like a 401(k)?  It seems like robbing Peter to pay Paul.  Sleigh said that Yucaipa actively avoids those investments, and that they would ask for concessions where necessary.  But drastic measures like replacing plans are much less necessary than people think. 

“In 20 years of doing this,” Sleigh said, “I don’t think we’ve ever replaced a DB plan.”

Sleigh was also quick to dispel the notion that his work was less investment and more labor activism.  “It’s not our business model to just be nice to unions,” he said.  “It’s that being nice to unions is good for our business.” 

How good?  In the twenty or so years that Yucaipa has been doing this type of private investing, their average annual ROI sits above 40%.  In the past few years, when overall investing has seen losses of about 35%, private equity (including Yucaipa) has lost more like 5%.  That makes pension plan fiduciaries happy to invest, Sleigh said.  The benefit to unionized workforces is a happy side-effect.

So what’s the next step for this blended investment model?  Employee ownership.  Sleigh said that he’s working on a business model that would use ESOPs as an exit strategy.  So, once a company was healthy, instead of putting it up for sale on the open market, an ESOP would be put in place to turn ownership over to the employees without requiring the massive debt that’s made recent ESOP use such a disaster (think: Sam Zell’s Tribune takeover).

The internet has ads for it.  And against it.  At the party your wife dragged you to, they were talking about it.  At your office yesterday, too.   The news can’t get enough of it, be it Fox, Air America or NPR.  It’s on people’s bumpers, for crying out loud.  

Maybe you’ve gone along with these people, not wanting to be the one to admit you don’t really get it, or maybe you ‘ve never heard of it.  But the fact remains, everyone – everyone – is talking about the Employee Free Choice Act, and you have no idea what they’re saying. 

Hi.  This post is for you.

Introduced in both houses, for the second time (it first hit the House in 2007), EFCA is the proposed legislation that blew the doors open on NLRA reform.   Called “Card Check”  by its detractors, the bill would drastically change national labor law and policy, resulting in easier unionization of workplaces, more strength for union activities, and higher penalties for employer violations.  Needless to say, the business community is less than pleased. 

You may have heard that the Free Choice Act might not pass – that’s true.  Some key former supporters have jumped ship recently, leading to questions about the bill’s viability in this year’s Congress.  But the cat’s out of the bag on reforming the national labor laws, and if   when something happens, it will be because of the conversation started over EFCA.

So what’s the big deal?  Here’s what the bill would do:

1. Replace the current rules for voting for or against a union. 

Currently, a union has to get a majority of workers to sign cards indicating they want to hold a union election, present the cards to the NLRB, then let the NLRB oversee a secret ballot election.  The unions say this takes too long, and gives the employer a chance to hire a union-busting consultant or lawyer (or both), retaliate and threaten pro-union supporters, force employees to attend anti-union meetings, and otherwise clog worker’s attention with reasons they should vote “no”.  Then, they say, a lot of employers find ways to just plain cheat. 

The Free Choice Act would do away with everything except that very first part, where a majority of workers signed cards saying they wanted the vote.  After EFCA, those cards would be their votes, and a majority of cards would mean the union won.  This is where the bulk of the EFCA debate focuses its attention – the business community says giving up “secret ballot” elections is unamerican.  The unions say there were never fair elections to begin with.  But that’s mostly just rhetoric.  Here’s the real debate:

From the business perspective, this has “fraud bait” written all over it.  Without NLRB oversight, the potential for cheating by a union looking for new meat would be huge (think: writing in cards, changing votes, padding, etc.).  Trying to keep things fair would prove impossible.

Unions say that EFCA just levels the playing field, since right now they don’t get to talk to the employees before an election, and the employer can say whatever it wants.  To the unions, the employers just don’t want to lose the time they have to hold their indoctrination sessions, and the card check procedure would make it more likely that a worker’s vote wouldn’t be influenced by employer bias.

2. Force Arbitration for First Contracts

If a union wins a vote, of course, the next thing they have to do is start negotiating their first Collective Bargaining Agreement, or CBA.  Right now, while employers have to negotiate in “good faith,”  they don’t have to agree to any specific demand made by the union.  They can always say “no” - it’s called bargaining to an impasse - and the union’s recourse is to do things like go on strike or file a claim with the NLRB.  It’s just understood that first contracts are going to take longer than other contracts, many many months longer, in a lot of cases.

Under EFCA, after two months of bargaining, either side will have a right to submit the negotiations to binding arbitration.  An arbitrator will hear both sides and then work out the contract’s provisions as they see fit.  Those contract terms will then be binding on the employer and the union for two years. 

So, if an employer really feels strongly enough to fight a union demand tooth-and-nail, it’s not only going to have to bargain hard with the union, it’s going to have to convice an arbitrator that whatever the union wants is bad for the company and the workers.  Former Republican Speaker of the House Newt Gingrich recently calls the arbitration changes in EFCA the ”real threat” of the bill.  

3. Raise the Penalties for Employer Labor Law Violations

This doesn’t get nearly as much attention as the two other changes, but to me, the penalty increases are EFCA’s sleeping giant. 

Right now, when an employer violates an employee’s rights under the NLRA, most of the remedies are focused on getting the employer to do something: sitting down at the bargaining table or restoring an employee’s status.  The Board does have some power to act to ensure future violations won’t happen, by posting signs regarding the employees’ rights, for example.   As far as money goes, the Board can order an employer to pay an aggrieved employee front and back pay in some cases, or pay litigation costs if the employer’s actions warrant it.  But the focus is on restoration of relations, not punishment.

Under EFCA, the concept of “remedy” in the labor law will drastically change.  Instead of just being about restoring an employee, financial damages will move into the “make-sure-this-doesn’t-happen-again” column.  If the Board finds that an employer infringed on a worker’s rights during an organizing campaign, the worker will be entitled to treble damages – three times the back pay he’s owed.   The NLRB will also have to seek an injunction to stop an employer’s actions if it has reason to believe the employer is violating the Act, and can assign fines of up to $20,000 for other employer violations, like threatening to close a plant or lay off workers when they seek unionization.  

When the penalty issue comes up in EFCA debates (which is not as often as it should), employers are quick to point out that there are no comparable penalties for union-side violations of the NLRA.  In their defense, unions cite statistics showing that the overwhelming majority of NLRB cases are employer violations.  Employers say that’s only because workers don’t generally go after unions, but unions will always go after employers. 

I’ll go into more detail on the penalty provision of EFCA in another post, but suffice it to say punishment-style penalties for employers will likely change the nature of the NLRB, from facilitator to enforcer.  Depending on which side of the labor debate you’re on, that is either exciting or very, very scary. 

What Does All This Mean?

The one thing both sides of this debate can agree on is that the Employee Free Choice Act (if it ever gets passed) will drastically alter the landscape of the American workforce.  With card-check elections, employers will have to either accept unionized workers, or work constantly to maintain an anti-union mentality in their employees. 

Plus, service and tech industries that have never thought about national labor law may find themselves with 90 days to negotiate a first contract before going to arbitration, and fear of stiff penalties for violations of the Act. 

Unions see EFCA as levelling the playing field, and there’s no doubt that they have had a difficult time organizing for decades.  As for the business community, even the employers who think they’ve had it relatively easy see EFCA as a drastic move to unionize workers, partially by stripping important safeguards against union misconduct. 

Support for the Free Choice Act is diminishing on the Hill, and the debate now seems to be whether a compromise will take some of the teeth out of one of the three provisions or if the democrats will table EFCA until they can get the votes needed to pass it as-is. 

——————

That’s it.  Now you’re all caught up.  If you have strong feelings about this significant law, feel free to leave them in the comments.  Otherwise, go hang out at the water cooler and wait for a chance to look smart.

The article points out that labor lawyers are using EFCA to their advantage:

Labor consultants and lawyers are looking to profit from interest in the Free Choice Act by briefing companies large and small on a range of matters such as complying with current and recently enacted legislation, and how to detect union organizing and prevent it without breaking the law. Another pressing issue is whether companies have opened themselves to union organizing drives because they have cut jobs, pay or benefits to weather the economic slump.

Now the question is: if the Free Choice Act falls apart like it seems it might, or gets negotiated into a watered-down shell of its former self, will the offshoot work dry up, too?  Or worse – will clients, having just spent precious money on EFCA training (or as the AFL-CIO calls it, “fear mongering ” to sell “products”), feel squeezed and back off?

To be sure, EFCA will mean across-the-board changes for most companies’ labor policies, and it should be given the weight it deserves.  But if the economy has taught us anything, it’s the need to balance consumers’ emotions with their actual needs.

99% of clients seeking L&E work out of fear probably do need help, many more than they realize.  It’s our job as their lawyers to get it to them without exploiting their fears.

Meanwhile, Senator Mark Warner (D-Vir.) seems to be wavering.  Warner announced that he backs a vote for cloture, but he said he will evaluate his stance on the measure after EFCA has reached the floor.

Workplace Prof Blog recently reported on a story floating around about the compromise operations that have already begun in an effort to get EFCA passed through Congress.