Work Transferred to Mexico Must Be Returned Stateside

By Erin L. Winters Sep 28, 2016
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The National Labor Relations Board's order directing a light manufacturer to return work transferred to Mexico after a wage strike was proper, the 7th U.S. Circuit Court of Appeals ruled.

The court issued its decision after Illinois-based employees of Amglo Kemlite Laboratories walked off the job to protest low wages. For several years prior to the strike, the workers complained about wages at the company, which makes specialty lights including those found on airplane wings. In September 2011, Amglo's president informed the Illinois plant employees that they would not receive raises. One day later, nearly all the company's employees walked off the job.

After a nearly weeklong strike, about one-half of the workforce agreed to return to work without a pay increase. Amglo recalled nearly three-quarters of the striking employees eventually. However, the company informed the remaining unrecalled workers that there were "no jobs available" and that their work would be transferred to Mexico.

Unfair labor practice charges were filed with the National Labor Relations Board against Amglo, which is not unionized. Before the board, the company conceded that the work stoppage was protected activity under the National Labor Relations Act.

Amglo contended, however, that the employees lost the protection of the act during their strike by staying inside the plant for several hours after management informed the employees that they would not be given raises and should leave the premises.

The board concluded that the company unlawfully threatened its employees with discharge and transferred work from its Illinois facility to its Mexico facility in retaliation for its employees' work stoppage. The board ordered Amglo to restore its production work in Illinois and offer full reinstatement to any employees who lost their job as a result of the transfer of work.

Amglo challenged the board's ruling and sought to have the order to return the work to the Illinois plant set aside. The 7th Circuit concluded that unlawful animus was a "motivating factor" in transferring the work. The court highlighted the company president's "hostility" to the striking employees and her statement to the employees that Amglo would move work "because of the situation." Finally, the court pointed to the timing of the work transfer, which was "so soon" after the work stoppage that it was "suspicious."

In rejecting Amglo's rational that it moved the work for economic reasons, the court pointed out that the company had increased its staff from 85 to 94 employees in the nine months prior to the strike.

Amglo contended that the amount of work transferred was "miniscule" and that the board failed to prove how much work and how many employees the relocation affected.

Amglo Kemlite Laboratories Inc. v. National Labor Relations Board, 7th Cir., Nos. 15-3695 & 15-1141 (Aug. 17, 2016).

Professional Pointer: Employers seeking to transfer work between facilities should be sure the rationale for the move is well-documented and confirm that the transfer is not related to impacted employees' engagement in a protected activity.

Erin L. Winters is an attorney with Foster Employment Law, the Worklaw® Network member firm in Oakland, Calif.

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