News for the Hospitality Executive
Employers Can Win National Labor Relations Board “Tug of War”
Ask a hotel general manager or a senior restaurant company executive what keeps him or her awake at nights these days and the answer may not be “fear of a double-dip recession.” Though the stakes are high in the industry’s fight to battle back from a major economic recession, a different kind of battle may be causing sleeplessness among hospitality executives.
In Washington, DC, the National Labor Relations Board, the independent Federal agency that is charged with guaranteeing U.S. employees the right to choose whether or not to affiliate with or be represented by a labor organization, has been in the news so much of late that employers who hadn’t been paying attention to developments at the agency are now clearly focused on what some view as grave threats posed by the NLRB’s rule-making.
Since 2007 when President George W. Bush failed to appoint new members for those whose terms would soon expire, the NLRB has been making news that causes employers around the US to shudder. Just prior to losing its quorum the NLRB declared that of its remaining three members from the original five-member panel (who are appointed by the president and confirmed by the Senate) it would grant decision-making authority to a quorum of those three: in other words, two members out of the Board’s normal complement of five would have the power to decide federal union/management cases.
Numerous decisions were handed down by the two-member working group but later invalidated when the U.S. Supreme Court ruled that these decisions were made absent a quorum and thus could not be enforced. Following the election of Barack Obama as President his administration sought to appoint Board members whose views were seen as pro-labor; conservatives in Congress blocked their confirmation and President Obama later put his choices in office through recess appointments.
In moves that critics have charged are motivated by politics—a desire to reverse a long slide in union membership among non-government employees—the Board’s Obama appointees have been very busy, to say the least. As moves by Democrats in Congress to pass pro-union legislation early in President Obama’s administration were stymied by restive Republicans and even some unconvinced Democrats, the agency that would have administered these laws, the NLRB, turned to law-making by rule-making.
Following the failed effort to win approval of the Employee Free Choice Act (EFCA) championed by the president and Sen. Edward M. Kennedy (D, MA) among others, the NLRB sought to enact by rule-making pieces of the EFCA proposing, for example, that the timing of union elections once a labor organization filed a petition to represent employees at an employer’s business be shortened considerably, from roughly 45 days to as little as 10 to 20 days.
Business groups challenged the Board’s authority and sued the NLRB, dubbing the agency’s proposal the “ambush election rule”. Labor/employment attorney Arnold Perl of the law firm Glanker Brown, addressing a Memphis hotel industry gathering in February 2012 told the group that the NLRB’s planned April 30 adoption of the rule represented a “black swan event” for the lodging industry.
The NLRB also gave notice of another new rule it intended to adopt requiring employers to display prominently an 11-inch x 17-inch poster entitled “Employee Rights Under the National Labor Relations Act”. Business groups immediately assailed the proposal as no less than advertising for labor unions. Lawsuits were filed challenging its validity. Following seesaw decisions for and against its legality the poster is currently on ice, the victim of a temporary injunction.
And the “ambush” election rule? As of mid-May a U.S. District Judge stopped its enforcement, saying that the NLRB two-member vote to adopt the rule failed to meet the agency’s own rules on the necessary quorum for votes to be valid. While the NLRB has already said it will abide by the judge’s decision, there is little question that the reprieve he granted business owners in this tug of war between the NLRB and U.S. employers will be short-lived unless Congress or the courts act to permanently strike down the election rule. The same is true of the union rights poster.
Employers Can Fight -- Or Empower – Employees
Hotel and restaurant chain employers are understandably reticent to speak on the record about how they will respond when the NLRB makes its next move, preferring not to telegraph their game plan, for example, should the NLRB simply re-vote the shortened election-timing rule back into effect using a proper quorum of its members.
Attorney Perl provided familiar advice to the Memphis lodging executive audience. Perl said employers should not only assess employee morale and where they may be vulnerable to a union—in other words, the issues that could turn employees in favor of a union—but also to keep employee lines of communication open and have a plan in place that they would implement in case a union representation petition is filed.
While this advice isn’t inconsistent with what labor/employment firms recommend, hospitality employers who are adapting older policies from an earlier era to their new, inquisitive, globally attuned social media-driven workforce may find something missing here—a focus on what’s right for today’s employees.
Rather than spending time seeking out potential vulnerabilities to unions some hospitality companies are choosing to employ a workforce that can be trusted to make a good decision should a union seek to represent them, and employees are responding—with their votes of a different kind. The 2012 Fortune/Money “Top 100 Best Employers to Work For” report applauds some of these employers: Marriott International, Intercontinental Hotels, Four Seasons Hotels & Resort, Kimpton Hotels & Restaurants, American Express, Darden and Starbucks.
At Marriott retiring CEO Bill Marriott still follows his father and Marriott founder’s advice: Take good care of your employees and they will take good care of our customers. At Starbucks founder Howard Schultz has repeatedly shared his philosophy about employees, saying “We built the Starbucks brand first with our people, not with consumers. Because we believed the best way to meet and exceed the expectations of our customers was to hire and train great people, we invested in employees.”
Labor/employment lawyer C. R. Wright of Fisher & Phillips LLP in a May 2012 firm advisory entitled “A Love or Hate Employment Relationship – How Do Your Employees Feel?” shared an employee relations formula that could as well have been written by Bill Marriott or Strabucks’ Schultz.
Employers, says attorney Wright, should be:
Hospitality employers need not be intimidated by whatever happens at the National Labor Relations Board. Building a company that puts people first is an offense difficult to penetrate. The best employers know that – and so do their employees.
Reprinted with permission from Cayuga Hospitality Review. All rights reserved.
Cayuga Hospitality Advisors
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