With the United States Senate’s rejection of National Labor Relations Board (“NLRB” or “Board”) Chair Lauren McFerran’s reconfirmation on December 11, 2024, President Biden’s pro-labor era at the NLRB came to an end, and the reversal of policies, rules, and decisions of “the most pro-union President leading the most pro-union administration in American history”[1] is set to begin.
Change at the Board will occur almost certainly on, or immediately after, inauguration day. Still, reversals of the Biden Board’s policies, rules, and decisions will take time, requiring unionized and non-union employers to exercise extreme caution in maintaining and establishing their workplace policies and rules, as well as in responding to union organizing activity or a union organizing campaign. In the meantime, what follows is a recap of the most significant pro-union policies, rules, and decisions of the Biden Board, a prediction of when and how they are likely to change, and tips on how employers should proceed.
Changing Faces
McFerran’s failed reconfirmation leaves the NLRB with two Democrats (Gwynne Wilcox and David Prouty), one Republican (Marvin Kaplan) and two vacancies which will allow President-elect Donald Trump, with Senate consent, to quickly gain a Republican majority on the 5-member Board and reverse many of the Biden Board’s expansive pro-union policies.
While it is the Board itself that effectuates the decisions and establishes the precedent, it is the Board’s General Counsel (“GC”) who sets the course for the Board with the power to investigate and prosecute unfair labor practice charges, issue general guidance on key issues concerning employee and employer respective rights, provide direction to the Board’s field offices in processing cases and, ultimately, serve up the cases that will allow the NLRB to reverse the Biden Board’s pro-union precedential decisions.
President Biden began the pro-union movement in his administration on inauguration day with his immediate and unprecedented termination of the prior administration’s GC, Peter Robb, and the appointment of the Special Counsel for the Communication Workers of America, Jennifer Abruzzo, to serve as GC for his administration. Robb was the first Board GC to ever be fired by a president. GC Abruzzo quickly outlined her plan for an aggressive pro-union shift from the previous business-friendly approach under the Trump Board and identified numerous areas of labor law that she wished to overturn with the help of the Biden Board through GC Memoranda (“GC Memos”). During her time as GC, Abruzzo has taken an aggressive approach at overturning longstanding Board law and implementing expansive remedies for employees through her GC Memos.
Although President Biden’s termination of GC Robb was unprecedented, President-elect Trump will likely return the favor, terminating GC Abruzzo on inauguration day or shortly thereafter. Most, if not all, of GC Abruzzo’s GC Memos will be rescinded in the days that follow. Some of the most welcomed rescissions will result in a return to seeking more reasonable settlement terms, removing the unfair labor practice tag on employers’ use of commonsense security and production monitoring practices, and the Board minding its own business and refraining from interfering with employers’ use of non-competition agreements and so-called “stay or pay” provisions. A refresher on the constraints about to be lifted follows.
Abruzzo’s GC Memos Likely to Be Rescinded
Negotiating Settlement Terms. On September 15, 2021, GC Abruzzo issued GC Memo 21-07 (Full Remedies in Settlement Agreements) instructing NLRB Regional Directors to seek no less than 100% of the backpay and benefits owed to unlawfully terminated or discriminated employees in negotiating settlement agreements. The GC stated that it was the Board’s “policy to seek nothing less than reinstatement and full backpay in all cases involving unlawful firings” and, importantly, where a terminated employee did not wish to return to work for the previous employer, regions were to “include front pay as part of their settlement calculations.”
Surveillance and Management Practices. On October 31, 2022, GC Abruzzo issued GC Memo 23-02 (Electronic Monitoring and Algorithmic Management of Employees Interfering with the Exercise of Section 7 Rights), instructing regions to allege that employers “presumptively violated Section 8(a)(1) [of the National Labor Relations Act (“NLRA”)[2]] where the employer’s surveillance and management practices, viewed as a whole, would tend to interfere with or prevent” an employee from engaging in protected Section 7 activity.[3] The GC broadly defined “surveillance and management practices” to include security cameras, employer-provided phones and computers, cameras in company vehicles, GPS devices, and artificial intelligence-based employee production software.
Non-Competition Agreements. On May 30, 2023, GC Abruzzo issued GC Memo 23-08 (Non-Compete Agreements that Violate the NLRA), arguing that except in limited circumstances, the proffer, maintenance, and enforcement of non-compete clauses violate the NLRA, unless such provisions are narrowly tailored to special circumstances justifying the infringement on employee rights. She claimed non-compete agreements tend to “chill” employees in the exercise of their Section 7 rights and, as such, they violate Section 8(a)(1) of the NLRA.
In October 2024, GC Abruzzo issued GC Memo 25-01 (Remedying the Harmful Effects of Non-Compete and “Stay-or-Pay” Provisions that Violate the NLRA), urging the Board to remedy the “harmful effects” non-compete agreements have on employees by providing certain “make-whole” relief. She argued that when the Board finds an employer has maintained an unlawful non-compete agreement, rescission alone will fail to remedy “all the harms” caused by the agreement, and “make-whole remedies to unwind discipline or legal enforcement actions, while also necessary, will not be sufficient.” She claimed these remedies are inadequate because non-compete agreements reduce employee benefits and wages by restricting job opportunities and, for employees who separate from employment, these agreements create “additional financial burdens,” such as taking a lower-paying job rather than one in the employee’s field or relocating to another area. To compensate employees for these effects of non-compete agreements, she proposed that “employees should be permitted to come forward during the notice-posting period and demonstrate that they were deprived of a better job opportunity as a result of the non-compete provision.”
GC Memo 25-01 also urged the Board to find that any provision under which an employee must pay their employer if they separate from employment, whether voluntarily or involuntarily, within a certain timeframe (e.g., a training or education repayment agreement or repayment of sign-on bonus) is presumptively unlawful.
Biden Board Pro-Union Law Likely to be Reversed
Following President Biden’s promise to be the most pro-union President leading the most pro-union administration in American history, the Biden Board shifted labor law in a direction that heavily favored big unions and rolled back historical pro-employer Board precedent, including much of the precedent established under the first Trump Board. Below is an overview of some of the Biden Board’s most impactful decisions and rulings and the likely response from the second Trump Board.
Representation Elections – Cemex
Worker support for organizing unions hit record levels under the Biden Administration. In fact, public approval of labor unions increased to 70% in August 2024, the second highest level in 57 years. Currently, only 23% of Americans disapprove of labor unions, a number that has not been this low since September 1967. Unions’ increase in popularity follows the Board’s reporting of significant increases in union activity, including a 27% increase in union election petitions over the past year. Moreover, union elections have more than doubled since 2021. This spike in petitions is primarily driven by employer filed RM-petitions after the Board’s controversial decision in Cemex Construction Materials Pacific, LLC, 372 NLRB No. 130 (2023).
Cemex was one of the most significant Board rulings in decades. In short, Cemex makes it easier for unions to be certified without a Board-ordered secret ballot election and sets forth a new framework for when employers must recognize a union. Under the previous standard, when an election was held, if the employer committed an unfair labor practice during the election period that could impact the results of the election, the Board would require the election to be set aside and hold a re-run election. Under Cemex, if an employer commits an unfair labor practice after an election petition is filed, the Board will now dismiss the petition entirely and order the employer to recognize and bargain with the union without an election. This standard removes the employees’ ability to anonymously decide whether or not they want union representation at their workplace.
Cemex not only drastically changed the standard for how union elections work, but it also placed additional requirements on employers when they are faced with a union’s demand for recognition. Cemex requires that when an employer receives a request for recognition based on an alleged majority of employee support for a union, the employer must either (1) immediately recognize the union and start bargaining, or (2) within 14 days file an RM petition seeking a secret ballot election to verify the union’s alleged majority status. If the employer does neither, the Board will issue an affirmative bargaining order and the employer will be required to recognize the union. If the employer files an RM petition and subsequently is found to have committed unfair labor practices, the Board will dismiss the RM petition and order that the union be recognized.
Cemex was a drastic shift in Board precedent and has come under intense scrutiny from the business community. The decision will almost certainly be overturned by the Trump Board, but how quickly is yet to be seen. Until the decision is overturned, employers must be mindful of Cemex and adequately train all supervisors on what to do and how to respond when they receive a union’s demand for recognition.
“Ambush Election” Rules
Another change in Board election law came in August 2023, when the Biden Board issued its final rule for union elections, which revived the prior “ambush” or “quickie” election rules. See 29 C.F.R. Part 102 et seq. This rule greatly reduced the time period between when an election petition is filed and the date the election is held, which makes it more difficult for employers to educate employees about unions and unionization prior to voting in the union election. According to the Board, the rule sought to: (1) commence pre-election hearings sooner; (2) speed up the dissemination of election information to employees; (3) make pre- and post-election hearings more efficient; and (4) hold union representation elections more quickly.
Specifically, the rule requires pre-election hearings to be scheduled for eight calendar days from the service of the notice of hearing, which is ten days sooner than under the 2019 rule. § 102.63. This requires employers to present documents and witness testimony at the pre-election hearing with significantly less time to prepare. Additionally, Regional Directors only have the discretion to postpone a pre-election hearing for up to two business days “upon request of a party showing special circumstances” or for more than two days if a party shows “extraordinary circumstances.” § 102.63(a). Under the 2019 rule, Regional Directors had the discretion to postpone the hearing for an unlimited time upon a showing of good cause. The rule allows union petitioners simply to respond orally at the pre-election hearing as opposed to being required to submit a formal statement of position 3 business days prior to the hearing. This change leaves employers in the dark about the relevant issues until the day of the hearing.
The rule also states that “the purpose of the pre-election hearing is to determine whether a question of representation exists” and disputes over the eligibility or inclusion of certain individuals “ordinarily do not need to be litigated or resolved prior to an election.” § 102.64. The rule eliminates any requirement under the 2019 rule that individual eligibility and inclusion issues must be resolved by the Regional Director prior to the election. Finally, the rule requires Regional Directors to schedule elections for “the earliest date practicable” after a decision and direction of election. § 102.67(b). The 2019 rule did not require elections to be held before the 20th day after a direction of election was issued.
The Trump Board will almost certainly return to its 2019 rule, which provides much more flexibility and time to respond and react to election petitions. But, again, how quickly is yet to be seen. Until the current rule is changed, an employer’s response time will be extremely limited after a union petition is filed and employers should ensure they have a detailed plan prepared in advance outlining how to respond if faced with an organizing campaign.
Captive Audience Meetings – Amazon Services
Shortly after the 2024 election, the Board issued another impactful pro-union decision. Amazon.com Services LLC, 373 NLRB No. 136 (2024). Amazon overturned nearly 75 years of Board precedent by ruling an employer violates the NLRA by requiring employees to attend a meeting where the employer informs the employees of its views on organizing and unionization. These meetings are commonly referred to as “captive audience meetings.”
In 1948, the Board held that captive audience meetings were lawful under the NLRA and the 1st Amendment in the case of Babcock & Wilcox, 77 NLRB 577 (1948). Since Babcock & Wilcox, employers have been able to broadly express their views on unionization to their employees and were further permitted to hold these captive audience meetings during organizing campaigns. The lone exception is that the meetings must occur at least 24 hours before the employees vote.
In overruling Babcock & Wilcox, the Board held that captive audience meetings force employees to listen to their employer’s views on unions and union representation, which further demonstrates the employer’s “economic power” over its employees. Specifically, the Board stated that these meetings contain “threats of reprisal” that employees will “suffer discipline, discharge, or some other adverse consequences if they fail to attend the meeting.” As such, the Board ruled that any mandatory meeting where an employer explains its views of unionization to its employees is unlawful, regardless of whether the employer supports or opposes unionization.
Given the size of the shift in precedent, along with the restrictions the Amazon decision places on employers, as well as its 1st Amendment implications, the Trump Board will undoubtedly return to the previous Babcock & Wilcox standard. But, again, how quickly is yet to be seen. In the meantime, employers should refrain from holding mandatory meetings where the topic of unionization is discussed. Additionally, over the past few years, several states have passed their own prohibitions on captive audience meetings. If faced with the threat of unionization, employers should consult with an experienced labor attorney to avoid an inadvertent violation of the NLRA.
Employee Policies & Employee Handbook Rules – Stericycle
In August 2023, the Board issued another precedential decision, this one adopting a strict standard for evaluating the legality of workplace rules under the NLRA, Stericycle, Inc., 372 NLRB No. 113 (2023). Stericycle overruled the previous standard established by the prior Trump Board in The Boeing Co., 365 NLRB 154 (2017). Under the Boeing standard, employee handbooks and other employer policies were either facially lawful or subject to a balancing test that weighed their tendency to restrict employees’ rights against the needs of the business justifying them.
Stericycle changed this standard by establishing a case-by-case review with heightened scrutiny of employer policies and rules and finding them presumptively unlawful if the rule could be viewed or interpreted to limit employee rights as viewed from the standpoint of an individual who is “economically dependent” on their employer. “Where the language” of an employee policy or rule “is ambiguous and may be misinterpreted by the employees in such a way as to cause them to refrain from exercising their statutory rights, then the rule is invalid even if interpreted lawfully by the employer in practice.“
In short, Stericycle allows employers to promulgate and maintain workplace policies and rules if they are narrowly tailored to advance legitimate business interests and minimize the risks of interfering with workers’ rights under the NLRA. Critics of the ruling, including current NLRB Board Member Kaplan, have stated that it is virtually impossible for employers to establish work policies and rules general enough to serve their intended purposes without being susceptible to an interpretation that could infringe on employees’ Section 7 rights under the NLRA. As such, the Stericycle test will likely be overturned by the Trump Board in the coming months, and the standard will likely revert to the more employer-friendly Boeing test for workplace policies and rules established during the first Trump administration. Once again, until Stericycle is overruled, employers must be extremely mindful of their workplace policies and rules to ensure they cannot be interpreted as to infringe on employees’ Section 7 rights.
Employer Statements During a Union Campaign – Siren Retail Corp.
Shortly after the 2024 election, the Board, as it did with its pro-union decision in Amazon Services, again overturned nearly 40 years of precedent issuing another pro-union decision, Siren Retail Corp. d/b/a Starbucks, 373 NLRB No. 135 (2024). Siren Retail Corp. overturned the Board’s 1985 decision in Tri-Cast, Inc., 274 NLRB 377 (1985), which had deemed nearly any employer statement to its employees relating to the impact unionization could have on the relationship between the individual employees and their supervisors, managers, and employers as categorically lawful during a union election campaign. Siren Retail Corp. reversed this nearly 40-year-old precedent and held that employers likely violate the NLRA by telling their employees that having a union could result in the loss of a direct relationship with management. The Board found such statements “unlawfully threaten employees with the loss of a benefit” as a result of the potential effort to unionize. As such, those statements, even if truthful, violate the NLRA.
Like the Amazon decision, Siren Retail Corp. will likely be short lived with the incoming Trump Board, and a return to the Tri-Cast, Inc. standard is anticipated. But until that occurs, employers and supervisors need adequate training on what constitutes lawful communications to employees when faced with a union campaign and election.
What Comes Next?
Change is coming. The policies, rules, and decisions of the Biden pro-union administration likely will be short-lived. How quickly is yet to be seen. The GC Memos likely will be rescinded immediately after President-elect Trump’s inauguration or shortly thereafter. The administrative rules and Board decisions which will require Board action and a Republican majority on the Board will take longer. Importantly, they will continue to be the law until they are reversed. In the meantime, employers must exercise extreme caution in maintaining and establishing their workplace policies and rules, as well as in responding to union organizing activity or a union organizing campaign. Consulting with legal counsel experienced in handling traditional labor issues can assist employers in making sound lawful decisions and further help navigate these complex issues.
[1] Remarks by President Biden in Honor of Labor Unions, https://www.whitehouse.gov/briefing-room/speeches-remarks/2021/09/08/remarks-by-president-biden-in-honor-of-labor-unions/, Sept. 8, 2021.
[2] The NLRA covers all “employees,” except the following: public sector employees; agricultural and domestic workers; independent contractors; workers employed by a parent or spouse; employees of air and rail carriers subject to the Railway Labor Act; supervisors; and managerial and confidential employees. 29 U.S.C. § 152(3).
[3] Section 7 of the NLRA guarantees employees “the right to self-organize, to form, join, or assist labor organizations, to bargain collectively through representatives of their own choosing, and to engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection,” as well as the right to “refrain from any or all such activities.” 29 U.S.C. § 157.
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