Employer's Statements Against Unionizing Were Not Coercive

The National Labor Relations Board (NLRB) incorrectly found that an employer's statements to workers during unionization efforts were coercive, the 6th U.S. Circuit Court of Appeals ruled.

In Hendrickson USA LLC v. NLRB, a manufacturing employer sent a letter to workers noting that union contract negotiations would start "from scratch." The employer also presented a PowerPoint slideshow stating that "relationships suffer" because of unionization, "flexibility is replaced by inefficiency," and "the culture will definitely change."

The NLRB found that the "from scratch" statement was coercive "because it threatened employees with the loss of wages and benefits if they authorized the union." The board also found that the PowerPoint statements violated the National Labor Relations Act (NLRA) by indicating that the company would no longer respond to employee concerns or issues and that employees would lose control over all aspects of their work lives if they unionized.

The 6th Circuit disagreed after considering the context of the statements. The employer's remark about starting negotiations from scratch pointed to the risks involved with contract negotiation, the court said, and the employer made clear through its communications that it was countering any claims that unionization would automatically lead to higher wages and better benefits.

Furthermore, the court said, the PowerPoint statements "can only be reasonably understood as elaborating upon and summarizing the company's position on the ineffectiveness of third-party representation, which was a lawful argument for the company to make."

Although the ruling was a win for the company, labor attorneys caution that employers should carefully word their communications with employees to avoid scrutiny under the NLRA.

Employer Right to Free Speech

The NLRA gives employees the right to form or join a union, and employers that interfere with that right or coerce employees may face charges of unfair labor practices. However, the act also gives employers the right to present arguments against unionization and express their opinions if the expression "contains no threat of reprisal or force or promise of benefit."

"Unionization can have significant implications for a company, so employers can and should have their say on the matter if it emerges in their workplaces," said David Pryzbylski, an attorney with Barnes & Thornburg in Indianapolis.

"The key takeaway here is a reminder that companies generally enjoy broad free-speech rights under the National Labor Relations Act when it comes to expressing their views on unionization to their workforces," he said.

Jonathan Spitz, an attorney with Jackson Lewis in Atlanta, said, "It's nice that the 6th Circuit took seriously the employer's right to free speech." While the NLRA primarily affords protections for employees, the act also gives employers the right to express opinions and facts, he said.

The 6th Circuit noted that "to qualify as lawful advocacy, a prediction that adverse consequences will result must be carefully phrased on the basis of objective fact."

Although the court found the statement about negotiating from scratch acceptable in this case, such language may be considered illegal, depending on the context. Employers should be careful about using language that can fall between permissible opinion and a threat that violates the NLRA, said Brian Hayes, an attorney with Ogletree Deakins in Washington, D.C.

"There's nothing wrong with pointing out to employees that collective bargaining is a give-and-take process," he noted. But the NLRB and the courts may focus on the artfulness of the expression rather than on the underlying point the employer is trying to make, he added, noting that employers may want to seek professional advice before communicating with employees during an organizing campaign.  

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Spitz noted that employers may want to use less-risky language than the disputed words in this case. "The message can be delivered in other ways without taking on that risk," he said. For example, employers can point out that by unionizing, employees will be giving up the right to speak for themselves, and the union will negotiate changes to wages, hours and working conditions.

Tips for Employers

Section 8(c) of the NLRA vests employers with broad free-speech rights to voice their opinions on unions to their workforces. The NLRA, however, also limits what employers can do if their employees express interest in forming a union, Pryzbylski said.

Generally, companies cannot:

• Threaten employees based on their union activity.
• Interrogate workers about their union activity or sentiments.
• Make promises to employees to induce them not to unionize.
• Spy on workers' union organizing efforts or create the impression of surveillance.

Employers that violate the NLRA by engaging in these acts can face penalties, Pryzbylski explained. However, employers can offer facts, opinions and examples to their workers when expressing why they believe their employees are better off without unions, he said.

"It's important for companies to stay within the legal parameters, but employers desiring to remain union-free can be comforted by the fact there are a lot of things they can lawfully say to their workers about this issue."