Representation-Case Procedures: Election Bars; Proof of Majority Support in Construction-Industry Collective-Bargaining Relationships, 18366-18400 [2020-06470]

Download as PDF 18366 Federal Register / Vol. 85, No. 63 / Wednesday, April 1, 2020 / Rules and Regulations NATIONAL LABOR RELATIONS BOARD 29 CFR Part 103 RIN 3142–AA16 Representation—Case Procedures: Election Bars; Proof of Majority Support in Construction-Industry Collective-Bargaining Relationships AGENCY: National Labor Relations Board. ACTION: Final rule. As part of ongoing efforts to more effectively administer the National Labor Relations Act (the Act or the NLRA) and to further the purposes of the Act, the National Labor Relations Board (the Board or the NLRB) hereby makes three amendments to its rules and regulations governing the filing and processing of petitions for a Boardconducted representation election and proof of majority support in construction-industry collectivebargaining relationships. The amendments effect changes in current procedures that have not previously been incorporated in the Board’s rules. The Board believes that the amendments made in this final rule will better protect employees’ statutory right of free choice on questions concerning representation by removing unnecessary barriers to the fair and expeditious resolution of such questions through the preferred means of a Board-conducted secret-ballot election. DATES: This rule will be effective on June 1, 2020. FOR FURTHER INFORMATION CONTACT: Roxanne L. Rothschild, Executive Secretary, National Labor Relations Board, 1015 Half Street SE, Washington, DC 20570–0001, (202) 273–1940 (this is not a toll-free number), 1–866–315–6572 (TTY/TDD). SUPPLEMENTARY INFORMATION: SUMMARY: jbell on DSKJLSW7X2PROD with RULES2 I. Background A. The Act The NLRA sets forth a number of rights and responsibilities that apply to employers, employees, and labor organizations representing employees, in furtherance of the Act’s overarching goals of protecting employees’ right to designate or select ‘‘representatives of their own choosing,’’ or to refrain from doing so; 1 ensuring that, except in situations covered by Section 8(f) of the Act, exclusive representatives are ‘‘designated or selected for the purposes of collective bargaining by the majority 1 Sec. 7 of the Act, 29 U.S.C. 157. VerDate Sep<11>2014 19:25 Mar 31, 2020 Jkt 250001 of employees’’ in an appropriate bargaining unit; 2 and promoting laborrelations stability.3 As discussed further below, Section 8(f) allows ‘‘an employer engaged primarily in the building and construction industry to make an agreement covering’’ certain employees ‘‘with a labor organization of which building and construction employees are members,’’ even if it has not been established that the labor organization represents a majority of the employees that it represents.4 In addition, while it is well established that the Act permits voluntary recognition of labor organizations, the Act also requires the Board—when the necessary prerequisites are met—to direct and conduct secret-ballot elections and certify the results thereof.5 B. Notice of Proposed Rulemaking (NPRM) On August 12, 2019, the Board issued the NPRM. The Board set an initial comment period of 60 days, with 14 additional days allotted for reply comments. Thereafter, the Board extended these deadlines twice: First for 60 days, and then for an additional 30 days. Various aspects of the NPRM are summarized below. 1. Summary of the Proposed Rule In the NPRM, the Board proposed to make three amendments to its current practices. The first amendment, § 103.20, proposed to modify the Board’s current practices that permit a party to block an election based on pending unfair labor practice charges. The proposed amendment provided that a blocking charge would not delay the conduct of the election and that the ballots would be impounded until there is a final determination regarding the charge and its effect, if any, on the election petition or the fairness of the election. The second amendment, § 103.21(a), proposed to modify the Board’s existing procedures providing for an immediate election bar following an employer’s voluntary recognition of a union as the majority-supported collectivebargaining representative of the employer’s employees. The proposed amendment provided for a postrecognition open period of 45 days within which election petitions could be filed and processed. The third amendment, § 103.22(b), proposed to redefine the evidence 2 Sec. 9(a) of the Act, 29 U.S.C. 159(a). 1 of the Act, 29 U.S.C. 151. 4 Sec. 8(f) of the Act, 29 U.S.C. 158(f). 5 Sec. 9(c)(1)(B) of the Act, 29 U.S.C. 159(c)(1)(B); Sec. 9(e) of the Act, 29 U.S.C. 159(e). 3 Sec. PO 00000 Frm 00002 Fmt 4701 Sfmt 4700 required to prove that an employer and a labor organization in the construction industry have established a voluntary majority-supported collectivebargaining relationship that could bar an election. Under the Board’s current practice, certain contract language, standing alone, is sufficient to prove such a relationship. The proposed amendment would require positive evidence that the union unequivocally demanded recognition as the majoritysupported exclusive bargaining representative of employees in an appropriate bargaining unit, and that the employer unequivocally accepted it as such, based on a contemporaneous showing of support from a majority of employees in an appropriate unit. 2. Reasons for Rulemaking In the NPRM, the Board acknowledged that it historically has made most substantive policy determinations through case adjudication, but stated that it interpreted section 6 of the Act, 29 U.S.C. 156, as authorizing the Board to engage in this informal notice-andcomment rulemaking. In addition, the Board found that using such rulemaking in this context was desirable because (1) it would enable the Board to solicit broad public comment on, and to address in a single proceeding, three related election-bar issues that would not likely arise in the adjudication of a single case; (2) rulemaking does not depend on the participation and argument of parties in a specific case, and it cannot be mooted by developments in a pending case; and (3) by establishing the new standards in its Rules and Regulations, the Board would enable employers, unions, and employees to plan their affairs free from the uncertainty that the legal regime may change on a moment’s notice (and possibly retroactively) through the adjudication process. 3. Reasons for Proposed Changes to Blocking-Charge Policy As discussed in greater detail in the NPRM, through adjudication the Board created the blocking-charge policy, which permits a party to block an election indefinitely by filing unfair labor practice charges that allegedly create doubt as to the validity of an election petition or the ability of employees to make a free and fair choice concerning representation while the charges remain unresolved. This policy can preclude holding the petitioned-for election for months or even years, if at all. See, e.g., Cablevision Systems Corp., Case 29–RD–138839, https:// www.nlrb.gov/case/29-RD-138839 (as E:\FR\FM\01APR2.SGM 01APR2 jbell on DSKJLSW7X2PROD with RULES2 Federal Register / Vol. 85, No. 63 / Wednesday, April 1, 2020 / Rules and Regulations noted by Cablevision Systems Corp., 367 NLRB No. 59 (2018), blocking charge followed by regional director’s misapplication of settlement-bar doctrine delayed processing until December 19, 2018, of valid decertification (RD) petition filed on October 16, 2014; employee petitioner thereafter withdrew petition). As the Board noted, and as discussed further in Section III.E. below, courts of appeals have criticized the blockingcharge policy’s adverse impacts on employee RD petitions, as well as the potential for abuse and manipulation of that policy by incumbent unions seeking to avoid a challenge to their representative status. See NLRB v. Hart Beverage Co., 445 F.2d 415, 420 (8th Cir. 1971); Templeton v. Dixie Color Printing Co., 444 F.2d 1064, 1069 (5th Cir. 1971); NLRB v. Midtown Serv. Co., 425 F.2d 665, 672 (2d Cir. 1970); NLRB v. Minute Maid Corp., 283 F.2d 705, 710 (5th Cir. 1960); Pacemaker Corp. v. NLRB, 260 F.2d 880, 882 (7th Cir. 1958). The potential for delay is the same when employees, instead of filing an RD petition, have otherwise expressed to their employer a desire to decertify an incumbent union representative. In that circumstance, the blocking-charge policy can prevent the employer from being able to seek a timely Boardconducted election to resolve the question concerning representation raised by evidence of good-faith uncertainty as to the union’s continuing majority support. Thus, the supposed ‘‘safe harbor’’ of filing an employer (RM) petition that the Board majority referenced in Levitz Furniture Co. of the Pacific, 333 NLRB 717, 726 (2001), as an alternative to the option of withdrawing recognition (which the employer selects at its peril) is often illusory. Additionally, concerns have been raised about the Board’s regional directors not applying the blockingcharge policy consistently, thereby creating uncertainty and confusion about when, if ever, parties can expect an election to occur. See Zev J. Eigen & Sandro Garofalo, Less Is More: A Case for Structural Reform of the National Labor Relations Board, 98 Minn. L. Rev. 1879, 1896–1897 (2014). The Board stated that it was inclined to believe, subject to comments, that the blocking-charge policy impedes, rather than protects, employee free choice. In a significant number of cases, the policy denies employees the right to have their votes, in a Board-conducted election on questions concerning representation, ‘‘recorded accurately, efficiently and speedily.’’ NLRB v. A.J. Tower Co., 329 U.S. 324, 331 (1946). Unnecessary delay robs an election-petition effort of VerDate Sep<11>2014 19:25 Mar 31, 2020 Jkt 250001 momentum, and many of the employees ultimately voting on the issue of representation may not even be the same as those who were in the workforce when the petition was filed. Additionally, the Board stated, the blocking-charge policy rests on a presumption that even an unlitigated and unproven allegation of any one of a broad range of unfair labor practices justifies indefinite delay because of a discretionary administrative determination regarding the potential impact of the alleged misconduct on employees’ ability to cast a free and uncoerced vote on the question of representation. Moreover, the current policy of holding petitions in abeyance for certain pre-petition ‘‘Type I’’ blocking charges 6 ‘‘represents an anomalous situation in which some conduct that would not be found to interfere with employee free choice if alleged in objections [to an election], because it occurs outside the critical election period, would nevertheless be the basis for substantially delaying holding any election at all.’’ Representation—Case Procedures, 79 FR 74308, 74456 (Dec. 15, 2014) (2015 Election Rule) (Dissenting Views of Members Miscimarra and Johnson) (citing Ideal Electric Mfg. Co., 134 NLRB 1275 (1961)). For these reasons, in the NPRM the Board proposed, subject to comments, to eliminate the current blocking-charge policy and to adopt a ‘‘vote-andimpound’’ procedure. Under that proposed procedure, regional directors would continue to process a representation petition and would conduct an election even when an unfair labor practice charge and blocking request have been filed. If the charge has not been resolved prior to the election, the Board proposed, the ballots would remain impounded until the Board makes a final determination regarding the charge.7 6 Type I blocking charges are charges that allege conduct that interferes with employee free choice (but does not call into question the validity of the election petition itself). See NLRB Casehandling Manual (Part Two) Representation Proceedings Sec. 11730.2 (Jan. 2017). 7 We note that nothing in the proposed rule purported to alter the existing requirements in 29 CFR 103.20 that only a party to the representation proceeding may file the request to block the election process; only unfair labor practice charges filed by that party may be the subject of a request to block; that party must file a written offer of proof as well as the names of witnesses who will testify in support of the charge and a summary of each witness’s anticipated testimony; and that party must promptly make available to the regional director the witnesses identified in the offer of proof. As noted further below, the final rule also does not affect any of those existing requirements. PO 00000 Frm 00003 Fmt 4701 Sfmt 4700 18367 4. Reasons for Proposed Changes to Voluntary-Recognition Bar As discussed in greater detail in the NPRM, employers may voluntarily recognize unions based on a union’s showing of majority support; a Board election is not required. NLRB v. Gissel Packing Co., 395 U.S. 575, 595–600 (1969); United Mine Workers of America v. Arkansas Oak Flooring Co., 351 U.S. 62, 72 fn. 8 (1956). Over time, the Board developed a rule that an employer’s voluntary recognition of a union would immediately bar the filing of an election petition for a reasonable period of time following recognition. See Sound Contractors Assn., 162 NLRB 364 (1966). Then, if the parties reached a collective-bargaining agreement during that reasonable period, the Board’s contract-bar doctrine would continue to bar election petitions for the duration of the agreement, up to a maximum limit of 3 years. See General Cable Corp., 139 NLRB 1123, 1125 (1962). In Dana Corp., 351 NLRB 434 (2007), a Board majority found that the existing immediate voluntary-recognition-bar policy ‘‘should be modified to provide greater protection for employees’ statutory right of free choice and to give proper effect to the court- and Boardrecognized statutory preference for resolving questions concerning representation through a Board secretballot election.’’ Id. at 437. Thus, the Dana majority held that voluntary recognition would not bar an election unless (a) affected bargaining-unit employees receive adequate notice of the recognition and of their opportunity to file a Board election petition within 45 days, and (b) 45 days pass from the date of notice without the filing of a validly supported petition. Id. at 441. The Board further stated that, ‘‘if the notice and window-period requirements have not been met, any postrecognition contract will not bar an election.’’ Id. Then, in Lamons Gasket Co., 357 NLRB 739 (2011), a new Board majority overruled Dana Corp. and reinstated the immediate voluntary-recognition election bar. Additionally, the Board defined the reasonable period of time during which a voluntary recognition would bar an election as no less than 6 months after the date of the parties’ first bargaining session and no more than 1 year after that date. Id. at 748. As the NPRM noted, ‘‘[a]t least since Lamons Gasket, the imposition of the immediate recognition bar, followed by the execution of a collective-bargaining agreement, can preclude the possibility of conducting a Board election contesting the initial non-electoral recognition of a union as a majority- E:\FR\FM\01APR2.SGM 01APR2 jbell on DSKJLSW7X2PROD with RULES2 18368 Federal Register / Vol. 85, No. 63 / Wednesday, April 1, 2020 / Rules and Regulations supported exclusive bargaining representative for as many as four years.’’ 84 FR at 39934 (August 12, 2019). In response to a 2017 Board Request for Information, some respondents contended that the Board should eliminate the voluntaryrecognition bar or, in the alternative, should reinstate the Dana notice and open-period requirements. In the NPRM, the Board proposed, subject to comments, to overrule Lamons Gasket and to reinstate the Dana notice and open-period procedures following voluntary recognition under Section 9(a). In this connection, the Board cited the justifications set forth by the Dana Board majority and the dissenting Member in Lamons Gasket. As the Board stated, while voluntary recognition is undisputedly lawful, secret-ballot elections are the preferred method of ascertaining whether a union has majority-employee support. See NLRB v. Gissel Packing Co., 395 U.S. at 602. The Board further noted that, in conjunction with the contract bar, an immediate recognition bar could deny employees an initial opportunity to vote in a secret-ballot Board election for as many as 4 years—or even longer, because the reasonable period for bargaining runs from the date of the first bargaining session, which, to be lawful, must come after voluntary recognition. The Board also stated that the Board election statistics cited in Lamons Gasket supported, rather than detracted from, the need for a notice and brief open period following voluntary recognition. In this connection, quoting the Lamons Gasket dissent, the Board stated that the statistics showed that (1) Dana served the intended purpose of assuring employee free choice in those cases where the choice made in the preferred Board electoral process contradicted the showing on which voluntary recognition was granted; (2) in those cases where the recognized union’s majority status was affirmed in a Dana election, the union gained the additional benefits of Section 9(a) certification, including a 1-year bar to further electoral challenge; (3) there was no substantial evidence that Dana had any discernible impact on the number of union voluntary-recognition campaigns, or on the success rate of such campaigns; and (4) there was no substantial evidence that Dana had any discernible impact on the negotiation of bargaining agreements during the open period or on the rate at which agreements were reached after voluntary recognition. Thus, the Board concluded, subject to comments, that it was necessary and VerDate Sep<11>2014 19:25 Mar 31, 2020 Jkt 250001 appropriate to modify the Board’s current recognition-bar policy—not currently set forth in the rules and regulations—by reestablishing a notice requirement and 45-day open period for filing an election petition following an employer’s voluntary recognition of a labor organization as employees’ majority-supported exclusive collectivebargaining representative under Section 9(a) of the Act. Along with the other changes in this rule, the Board stated that it believed, subject to comments, that the immediate imposition of a voluntary-recognition bar is an overbroad and inappropriate limitation on the employees’ ability to exercise their fundamental statutory right to the timely resolution of questions concerning representation through the preferred means of a Board-conducted election. 5. Reasons for Proposed Changes to Policy Regarding Proof of MajorityBased Recognition Under Section 9(a) in the Construction Industry As discussed in greater detail in the NPRM, based on the unique characteristics of the construction industry, Congress created an exception to the majoritarian principles that govern collective-bargaining relationships in other industries. Thus, as noted above, Section 8(f) of the Act permits a construction-industry employer and labor organization to establish a collective-bargaining relationship in the absence of support from a majority of employees. However, unlike collective-bargaining relationships governed by Section 9(a), the second proviso to Section 8(f) provides that any agreement that is lawful only because of 8(f)’s nonmajority exception cannot bar a petition for a Board election. Accordingly, there cannot be a contract bar or a voluntary-recognition bar to an election among employees covered by an 8(f) agreement. As recounted in the NPRM, the Board has used various tests over the years to determine whether a bargaining relationship or collective-bargaining agreement in the construction industry is governed by Section 9(a) majoritarian principles or by Section 8(f) and its exceptions to those principles. Beginning in 1971, the Board adopted a ‘‘conversion doctrine’’ under which a bargaining relationship initially established under Section 8(f) could convert into a 9(a) relationship by means other than a Board election or a majority-based voluntary recognition. See Ruttmann Construction, 191 NLRB 701 (1971); R. J. Smith Construction Co., 191 NLRB 693 (1971), enf. denied sub PO 00000 Frm 00004 Fmt 4701 Sfmt 4700 nom. Operating Engineers Local 150 v. NLRB, 480 F.2d 1186 (DC Cir. 1973). Conversion to a 9(a) relationship and agreement would occur if the union could show that it had achieved the support of a majority of bargaining-unit employees during a contract term. However, as the Board later recognized, ‘‘[t]he achievement of majority support required no notice, no simultaneous union claim of majority, and no assent by the employer to complete the conversion process’’; rather, ‘‘the presence of an enforced union-security clause, actual union membership of a majority of unit employees, as well as referrals from an exclusive hiring hall’’ were sufficient proof to trigger conversion. John Deklewa & Sons, 282 NLRB 1375, 1378 (1987), enfd. sub nom. Iron Workers Local 3 v. NLRB, 843 F.2d 770 (3d Cir. 1988), cert. denied 488 U.S. 889 (1988). In John Deklewa & Sons, the Board repudiated the conversion doctrine as inconsistent with statutory policy and congressional intent expressed through Section 8(f)’s second proviso. Id. at 1382. According to the Board in Deklewa, conversion of an 8(f) agreement into a 9(a) agreement raises ‘‘an absolute bar to employees’ efforts to reject or to change their collectivebargaining representative,’’ contrary to the second proviso of Section 8(f). Id. In addition, the Board adopted a presumption that construction-industry contracts are governed by Section 8(f), so that ‘‘the party asserting the existence of a 9(a) relationship’’ bears the burden of proving it. Id. at 1385 fn. 41. Noting, however, that ‘‘nothing in [its] opinion [was] meant to suggest that unions have less favored status with respect to construction[-]industry employers,’’ the Board also affirmed that a union could achieve 9(a) status through ‘‘voluntary recognition accorded . . . by the employer of a stable workforce where that recognition is based on a clear showing of majority support among the unit employees, e.g., a valid card majority.’’ Id. at 1387 fn. 53. Thereafter, the Board repeatedly stated that in order to prove a 9(a) relationship, a union would have to show its ‘‘express demand for, and an employer’s voluntary grant of, recognition to the union as bargaining representative, based on a showing of support for the union among a majority of employees in an appropriate unit.’’ Brannan Sand & Gravel Co., 289 NLRB 977, 979–980 (1988) (quoting American Thoro-Clean, 283 NLRB 1107, 1108– 1109 (1987)). And in J & R Tile, the Board held that, to establish voluntary recognition, there must be ‘‘positive evidence’’ that ‘‘the union E:\FR\FM\01APR2.SGM 01APR2 jbell on DSKJLSW7X2PROD with RULES2 Federal Register / Vol. 85, No. 63 / Wednesday, April 1, 2020 / Rules and Regulations unequivocally demanded recognition as the employees’ 9(a) representative and that the employer unequivocally accepted it as such.’’ 291 NLRB 1034, 1036 (1988). Subsequently, however, the Board held in Staunton Fuel & Material that a construction-industry union could prove 9(a) status based on contract language alone, without any other ‘‘positive evidence’’ of a contemporaneous showing of majority support. 335 NLRB 717, 719–720 (2001). Citing two decisions from the United States Court of Appeals for the Tenth Circuit,8 the Board explained that contract language would be independently sufficient to prove a 9(a) relationship ‘‘where the language unequivocally indicates that (1) the union requested recognition as the majority or 9(a) representative of the unit employees; (2) the employer recognized the union as the majority or 9(a) bargaining representative; and (3) the employer’s recognition was based on the union’s having shown, or having offered to show, evidence of its majority support.’’ 335 NLRB at 720. Finding that its contract-based approach ‘‘properly balance[d] Section 9(a)’s emphasis on employee choice with Section 8(f)’s recognition of the practical realities of the construction industry,’’ the Board stated that its test would allow ‘‘[c]onstruction unions and employers . . . to establish 9(a) bargaining relationships easily and unmistakably where they seek to do so.’’ Id. at 719. However, the United States Court of Appeals for the District of Columbia Circuit has sharply disagreed with the Board’s holding in Staunton Fuel. In Nova Plumbing, Inc. v. NLRB, the D.C. Circuit stated that ‘‘[t]he proposition that contract language standing alone can establish the existence of a section 9(a) relationship runs roughshod over the principles established in [International Ladies’ Garment Workers’ Union v. NLRB, 366 U.S. 731 (1961) (Garment Workers)], for it completely fails to account for employee rights under sections 7 and 8(f).’’ 330 F.3d 531, 536–537 (DC Cir. 2003), granting review and denying enforcement of Nova Plumbing, Inc., 336 NLRB 633 (2001). According to the court, under Garment Workers ‘‘[a]n agreement between an employer and union is void and unenforceable . . . if it purports to recognize a union that actually lacks majority support as the employees’ exclusive representative.’’ Id. at 537. The court further stated that, ‘‘[w]hile section 8(f) creates a limited exception to this rule for pre-hire agreements in the construction industry, the statute explicitly preserves employee rights to petition for decertification or for a change in bargaining representative under such contracts.’’ Id. ‘‘By focusing exclusively on employer and union intent,’’ the court stated, the Board’s test allowed employers and unions to ‘‘collud[e] at the expense of employees and rival unions,’’ betraying the Board’s ‘‘fundamental obligation to protect employee section 7 rights.’’ Id. The court returned to this theme in Colorado Fire Sprinkler, Inc. v. NLRB, 891 F.3d 1031 (DC Cir. 2018).9 There, the court—focusing closely on the centrality of employee free choice in determining when a Section 9(a) relationship has been established— stated that ‘‘[t]he raison d’eˆtre of the . . . Act’s protections for union representation is to vindicate the employees’ right to engage in collective activity and to empower employees to freely choose their own labor representatives.’’ Id. at 1038 (emphasis in original). The court observed that Section 8(f) ‘‘is meant not to cede all employee choice to the employer or union, but to provide employees in the inconstant and fluid construction and building industries some opportunity for collective representation . . . . [I]t is not meant to force the employees’ choices any further than the statutory scheme allows.’’ Id. at 1038–1039. Accordingly, the court held that ‘‘the Board must faithfully police the presumption of Section 8(f) status and the strict burden of proof to overcome it’’ by ‘‘demand[ing] clear evidence that the employees—not the union and not the employer—have independently chosen to transition away from a Section 8(f) pre-hire arrangement by affirmatively choosing a union as their Section 9(a) representative.’’ Id. at 1039. Applying this evidentiary standard, the court rejected the Board’s reliance solely on contract language in finding a 9(a) relationship, stating that such reliance ‘‘would reduce the requirement of affirmative employee support to a word game controlled entirely by the union and employer. Which is precisely what the law forbids.’’ Id. at 1040. In the interest of restoring protection of employee free choice in the construction industry, the NPRM proposed to overrule Staunton Fuel, to adopt the D.C. Circuit’s position that contract language alone cannot create a 9(a) bargaining relationship in that 8 NLRB v. Oklahoma Installation Co., 219 F.3d 1160 (10th Cir. 2000); NLRB v. Triple C Maint., Inc., 219 F.3d 1147 (10th Cir. 2000). 9 Granting review and denying enforcement of Colorado Fire Sprinkler, Inc., 364 NLRB No. 55 (2016). VerDate Sep<11>2014 19:25 Mar 31, 2020 Jkt 250001 PO 00000 Frm 00005 Fmt 4701 Sfmt 4700 18369 industry, and to therefore require positive evidence of majority union employee support before a collectivebargaining agreement or voluntary recognition between employers and unions would bar a petition to an election. For support, the NPRM stated that (1) as the D.C. Circuit recognized, Staunton Fuel permits an employer and union to ‘‘paper over’’ the presumption that construction-industry relationships are governed by Section 8(f); (2) under Staunton Fuel, the contract bar would prevent employees and rival unions from filing a Board election petition to challenge the union’s representative status for the duration of the contract up to 3 years, even though there was never any extrinsic proof that a majority of employees supported the union; (3) the ‘‘conversion’’ permitted under Staunton Fuel is similar to the flawed ‘‘conversion doctrine’’ that the Deklewa Board repudiated; and (4) the D.C. Circuit raised a legitimate concern that Staunton Fuel conflicts with statutory majoritarian principles and represents an impermissible restriction on employee free choice, particularly in light of the protections intended by Section 8(f)’s second proviso. II. Summary of Changes to the Proposed Rule In response to the comments received, the final rule changes the proposed rule with respect to all three policy areas discussed. A. Blocking-Charge Policy For the reasons discussed in further detail in Section III.E. below, the final rule does not retain the proposed rule’s vote-and-impound procedure in all cases. Rather, it requires impoundment only for cases where the unfair labor practice charge, filed by the party that is requesting to block the election process, alleges (1) violations of Section 8(a)(1) and 8(a)(2) or Section 8(b)(1)(A) of the Act that challenge the circumstances surrounding the petition or the showing of interest submitted in support of the petition; or (2) that an employer has dominated a union in violation of Section 8(a)(2) and seeks to disestablish a bargaining relationship. For those categories of charges, the final rule—unlike the proposed rule— provides that the ballots shall be impounded for up to 60 days from the conclusion of the election if the charge has not been withdrawn or dismissed, or if a complaint has not issued, prior to the conclusion of the election. If a complaint issues with respect to the charge at any time prior to expiration of that 60-day post-election period, then the ballots shall continue to be E:\FR\FM\01APR2.SGM 01APR2 18370 Federal Register / Vol. 85, No. 63 / Wednesday, April 1, 2020 / Rules and Regulations impounded until there is a final determination regarding the charge and its effect, if any, on the election petition. If the charge is withdrawn or dismissed at any time prior to expiration of that 60-day period, or if the 60-day period ends without a complaint issuing, then the ballots shall be promptly opened and counted. The final rule further provides that the 60-day period will not be extended, even if more than one unfair labor practice charge is filed serially. For all other types of unfair labor practice charges, the final rule—unlike the proposed rule—provides that the ballots will be promptly opened and counted at the conclusion of the election, rather than temporarily impounded. Finally, for all types of charges upon which a blocking-charge request is based, the final rule clarifies that the certification of results (including, where appropriate, a certification of representative) shall not issue until there is a final disposition of the charge and a determination of its effect, if any, on the election petition.10 The final rule also makes some minor, non-substantive changes to the title of the proposed rule. In short, under the final rule, the filing of a blocking-charge request will not delay the conduct of an election but may delay the vote count or certification of results. The regional director shall continue to process the petition and conduct the election. jbell on DSKJLSW7X2PROD with RULES2 B. Voluntary-Recognition Bar For the reasons discussed in Section III.F. below, upon consideration of all of the comments received, we have decided to adopt the proposed rule in substantial part. However, in response to certain comments, we have modified the rule to clarify that it shall apply only to an employer’s voluntary recognition on or after the effective date of the rule, and to the first collective-bargaining agreement reached after such voluntary recognition. Additionally, the final rule clarifies that the employer ‘‘and/or’’ (rather than ‘‘and’’) the labor organization must notify the Regional Office that recognition has been granted. The final rule also specifies where the notice should be posted (‘‘in 10 As noted previously, nothing in the final rule alters the existing requirements that only a party to the representation proceeding may file the request to block the election process; only unfair labor practice charges filed by that party may be the subject of a request to block; that party must file a written offer of proof as well as the names of witnesses who will testify in support of the charge and a summary of each witness’s anticipated testimony; and that party must promptly make available to the regional director the witnesses identified in the offer of proof. VerDate Sep<11>2014 19:25 Mar 31, 2020 Jkt 250001 conspicuous places, including all places where notices to employees are customarily posted’’); eliminates the proposed rule’s specific reference to the right to file ‘‘a decertification or rivalunion petition’’ and instead refers generally to ‘‘a petition’’; adds a requirement that an employer distribute the notice to unit employees electronically if the employer customarily communicates with its employees by such means; and sets forth the wording of the notice. The final rule also makes some minor, nonsubstantive changes to the title and other wording of the proposed rule. C. Proof of Majority-Based Recognition in the Construction Industry For clarity purposes, we have removed the amendment regarding proof of majority-based voluntary recognition in the construction industry from § 103.21 of the proposed rule and have placed it in its own section, Final Rule (Rule) § 103.22. In addition, for the reasons discussed in Section III.G. below, we have decided upon consideration of comments received to adopt the proposed rule with one modification: This portion of the final rule shall apply only to voluntary recognition extended on or after the effective date of the rule and to any collective-bargaining agreement entered into on or after the date of voluntary recognition extended on or after the effective date of the rule. The final rule also makes some minor, non-substantive changes to the wording of the proposed rule.11 III. Summary of Comments and Responses to Comments The Board received more than 80 comments from interested organizations, labor unions, members of Congress, academics, and other individuals. We have carefully reviewed and considered these comments, as discussed below. A. Propriety of Rulemaking One commenter contends that we have failed to adequately justify departing from the Board’s longstanding practice of proceeding by adjudication.12 However, Congress has delegated general rulemaking authority to the Board. Specifically, Section 6 of the NLRA, 29 U.S.C. 156, provides that 11 In accordance with the discrete character of the matters addressed by each of the amendments listed, the Board hereby concludes that it would adopt each of these amendments individually, or in any combination, regardless of whether any of the other amendments were made. For this reason, the amendments are severable. 12 Comment of AFL–CIO. PO 00000 Frm 00006 Fmt 4701 Sfmt 4700 the Board ‘‘shall have authority from time to time to make, amend, and rescind, in the manner prescribed by [the Administrative Procedure Act (APA)], such rules and regulations as may be necessary to carry out the provisions of [the NLRA].’’ Although the Board historically has made most substantive policy determinations through case adjudication, it has, with Supreme Court approval, engaged in substantive rulemaking. American Hosp. Ass’n v. NLRB, 499 U.S. 606 (1991) (upholding Board’s rulemaking on appropriate bargaining units in the healthcare industry). In this regard, the Supreme Court has expressly stated that ‘‘the choice between rulemaking and adjudication lies in the first instance within the Board’s discretion.’’ NLRB v. Bell Aerospace Co., 416 U.S. 267, 294 (1974). Further, Section 6 authorizes the final rule as necessary to carry out Sections 1, 7, 8, and 9 of the Act, 29 U.S.C. 151, 157, 158, and 159, respectively, discussed in relevant part in Section I.A. above. The Board’s election policies implicate each of these provisions of the Act, and Section 6 grants the Board the authority to promulgate rules that carry out those provisions. As discussed in Section I.B.2. above, in the NPRM the Board expressed its preliminary belief that rulemaking in this area of the law is desirable for several reasons. After carefully considering more than 80 comments, we continue to believe that rulemaking, rather than adjudication, is the better method to revise and clarify the matters of broad application at issue in this rule. First, the Board has repeatedly engaged in rulemaking to amend its representation-case procedures over the years as part of a continuing effort to improve the process and to eliminate unnecessary delays. It has only rarely utilized the APA’s notice-and-comment rulemaking procedures when doing so. Most often, the Board has simply implemented procedural changes in a final rule without prior notice or request for public comment. It did so most recently in December 2019. See Representation-Case Procedures, 84 FR 69524 (Dec. 18, 2019) (2019 Election Rule). However, a few years earlier, the Board engaged in a notice-and-comment rulemaking process that resulted in a final rule making widespread revisions in prior representation-case procedures. See 79 FR 74307 (December 15, 2014).13 13 See also comment of AFL–CIO in support of the Board’s 2015 Election Rule. 79 FR at 74314 (‘‘[T]he American Federation of Labor and Congress of Industrial Organizations (AFL–CIO) states that ‘[t]he NLRB has specific and express statutory authority E:\FR\FM\01APR2.SGM 01APR2 jbell on DSKJLSW7X2PROD with RULES2 Federal Register / Vol. 85, No. 63 / Wednesday, April 1, 2020 / Rules and Regulations Further, as here, some of the procedures addressed in that rulemaking process were originally established in adjudication. Second, the Board has been well served by public comment on the issues presented in response to the NPRM in this proceeding. The Board received numerous helpful comments from a wide variety of sources, many with considerable legal expertise and/or a great deal of relevant experience. Having considered these comments, we have refined the final rule in several ways, outlined above in Sections II.A. through II.C. and discussed more fully below in Sections III.E. through III.G. It is likely that we would not have received as much input had we addressed these issues through adjudication rather than rulemaking. Rulemaking has given interested persons a way to provide input through the convenient comment process, and participation was not limited, as in the adjudicatory setting, to legal briefs filed by the parties and amici. Third, as discussed in the NPRM, rulemaking has allowed us to address these issues without depending on the participation and argument of parties in a specific case, and without allowing the developments of a pending case to ‘‘moot’’ the issues. One commenter challenges this notion, arguing that the Board can avoid mootness by refusing to allow parties to withdraw cases or concede issues in adjudication.14 That commenter also contends that the existence of live controversies involving particular parties demonstrates that an issue is important to labor-management relations and merits Board resolution via adjudication.15 As discussed in greater detail in the NPRM, developments in specific cases have mooted some of the very issues covered by this rulemaking. See 84 FR at 39937 (citing Loshaw Thermal Technology, LLC, Case 05–CA–158650). As the commenter suggests, the Board has the discretion to refuse to allow parties to withdraw cases or to concede issues in a particular case. However, the existence of live controversies in adjudication of an issue does not mean that we lack the discretion to choose rulemaking as the means to address that issue. In addition, as discussed in the NPRM, this particular rulemaking has allowed us to address, in a single proceeding, three related election-bar issues that have not arisen—and likely to engage in rule-making to regulate its election process.’’’). 14 Comment of AFL–CIO (citing, e.g., 800 River Road Operating Co. d/b/a Care One at New Milford, 368 NLRB No. 60 (2019)). 15 Comment of AFL–CIO. VerDate Sep<11>2014 19:25 Mar 31, 2020 Jkt 250001 would not arise—in the adjudication of a single case. Fourth, as discussed in the NPRM, establishing the new standards in the Board’s Rules and Regulations will enable employers, unions, and employees to plan their affairs with greater certainty that significant changes to these areas of the law will not be made, and retroactively applied, in adjudication of a case to which they are not parties and about which they may be unaware. NLRB v. Wyman-Gordon Co., 394 U.S. 759, 777 (1969) (Douglas, J., dissenting) (‘‘The rule-making procedure performs important functions. It gives notice to an entire segment of society of those controls or regimentation that is forthcoming.’’). Specifically, rulemaking enables the Board to provide the regulated community greater certainty beforehand, as the Supreme Court has instructed that we should do. First Nat’l Maint. Corp. v. NLRB, 452 U.S. 666, 679 (1981). The same commenter also claims that the Board’s recent increased use of rulemaking rather than waiting for actual controversies to arise threatens to open the floodgates of policy oscillation. The claim is purely speculative, and runs counter to the general perception that rulemaking should diminish policy oscillation because it is harder to change policy through rulemaking than through adjudication.16 The commenter also contends that the Board fails to explain why rulemaking is appropriate here when the Board is not using it in numerous other areas, and that many of the stated reasons for proceeding through rulemaking in this context would apply in other contexts as well.17 However, even if rulemaking is appropriate in other areas, that does not require us to use rulemaking in all areas where it would be appropriate, let alone all at once. Cf. Mobil Oil Expl. & Producing Se. Inc. v. United Distrib. Cos., 498 U.S. 211, 231 (1991) (‘‘[A]n agency need not solve every problem before it in the same proceeding.’’); Advocates for Highway & Auto Safety v. Fed. Motor Carrier Safety Admin., 429 F.3d 1136, 1147 (D.C. Cir. 2005) (‘‘Agencies surely may, in appropriate circumstances, address problems incrementally.’’). And, as stated above, ‘‘the choice between rulemaking and adjudication lies in the first instance within the Board’s discretion.’’ NLRB v. Bell Aerospace Co., 416 U.S. at 294. Thus, this comment does not 16 See, e.g., Samuel Estreicher, Policy Oscillation at the Labor Board: A Plea for Rulemaking, 37 Admin. L. Rev. 163 (1985). 17 Comment of AFL–CIO. PO 00000 Frm 00007 Fmt 4701 Sfmt 4700 18371 demonstrate that rulemaking is inappropriate here. In sum, we continue to believe that use of the rulemaking process here is an appropriate exercise of the Board’s discretion and will be beneficial in ways that adjudication cannot be. B. Board Members’ Alleged ClosedMindedness and Motives Some commenters allege that the current Board Members have not shown an open mind and willingness to revise the wording proposed in the NPRM in light of public input because each Member previously has expressed a desire to revise the policies under consideration.18 For the reasons that follow, we reject these contentions. We assure the public that each participating 18 Comment of AFL–CIO (citing Pinnacle Foods Group, LLC., Case 14–RD–226626, 2019 WL 656304, at *1 fn. 1 (Feb. 4, 2019) (Chairman Ring and Member Kaplan); United Food & Commercial Workers, Local No. 951, Case 07–RD–228723, 2019 WL 1879483, at *1 fn.1 (April 25, 2019) (Chairman Ring and Member Emanuel); Heavy Materials, LLC., Case 12–RM–231582, 2019 WL 2353690, at *1 fn.1 (May 30, 2019) (Members Kaplan and Emanuel); G.F. Paterson Foods, LLC, Case 22–RD–210352, 2018 WL 509465, at *1 fn.1 (Jan. 19, 2018) (Members Kaplan and Emanuel); Leggett & Platt, Inc., Case 09–RD–200329, 2018 WL 509463, at *1 fn.1 (Jan. 19, 2018) (Member Kaplan); Calportland Arizona Materials Division, Case 28–RD–206696, 2018 WL 571496, at *1 fn.1 (Jan. 24, 2018) (Members Kaplan and Emanuel); Covanta Essex Co., Case 22–RD–199469, 2018 WL 654848, at *1 fn.1 (Jan. 30, 2018) (Members Kaplan and Emanuel); Wismettac Asian Foods, Inc., Case 21–RC–204759, 2018 WL 774103, at *1 n.1 (Feb. 6, 2018) (Member Kaplan); Apple Bus Co., Case 19–RD–216636, 2018 WL 3703490, at *1 fn.1 (May 9, 2018) (Members Kaplan and Emanuel); Kloeckner Metals Corp., Case 15–RD–217981, 2018 WL 2287088, at *1 fn.1 (May 17, 2018) (Members Kaplan and Emanuel); Bemis N.A., Case 18–RD–209021, 2018 WL 2440794, at *1 fn.1 (May 29, 2018) (Member Emanuel); Janus Youth Programs, Inc., Case 19–RM–216426, 2018 WL 2461411, at *1 fn.1 (May 31, 2018); Arh Mary Breckinridge Health Services, Inc., Case 09–RD– 217672, 2018 WL 3238969, at *1 fn.1 (June 29, 2018) (Chairman Ring and Member Kaplan); American Medical Response, Case 10–RC–208221, 2018 WL 3456223, at *1 fn.1 (July 17, 2018) (Chairman Ring and Member Emanuel); Apple Bus Co., Case 19–RD–216636, 2018 WL 3703490, at *1 fn.1 (Aug. 2, 2018) (Chairman Ring and Member Kaplan); Columbia Sussex, Case 19–RD–223516, 2018 WL 4382911, at *1 fn.1 (Sept. 12, 2018) (Chairman Ring and Member Kaplan); Westrock Services, Inc., Case 10–RD–195447, 2017 WL 4925475, at *1 fn.1 (Oct. 27, 2017) (Members Kaplan and Emanuel); ADT Security Services, Case 18–RD–206831, 2017 WL 6554381, at *1 fn.1 (Dec. 20, 2017) (Members Kaplan and Emanuel). See also Comment of United Food and Commercial Workers International Union, AFL–CIO (UFCW) (citing L&L Fabrication, Case 16–RD–232491, 2019 WL 1800677, at *1 fn. 1 (April 22, 2019) (Chairman Ring and Member Emanuel); Embassy Suites by Hilton, Seattle Downtown Pioneer Square, Case 19– RD–223236, 2019 WL 656277, at *1 fn. 1 (Jan. 15, 2019) (Chairman Ring and Member Kaplan); Heavy Materials, LLC, supra; Pinnacle Foods Group, LLC, supra; Loshaw Thermal Technology, LLC, Case 05– CA–158650, 2018 WL 4357198 (soliciting briefs addressing proposed changes to the Sec. 8(f)–to– 9(a) conversion doctrine)). E:\FR\FM\01APR2.SGM 01APR2 jbell on DSKJLSW7X2PROD with RULES2 18372 Federal Register / Vol. 85, No. 63 / Wednesday, April 1, 2020 / Rules and Regulations Board Member has approached this rulemaking with an open mind. ‘‘[A]n individual should be disqualified from rulemaking only when there has been a clear and convincing showing’’ that the official ‘‘has an unalterably closed mind on matters critical to the disposition of the proceeding.’’ Air Transp. Ass’n of America, Inc. v. NMB, 663 F.3d 476, 487 (D.C. Cir. 2011) (quoting C & W Fish Co. v. Fox, 931 F.2d 1556, 1564 (D.C. Cir. 1991)). Moreover, ‘‘[a]n administrative official is presumed to be objective and ‘capable of judging a particular controversy fairly on the basis of its own circumstances.’ ’’ Steelworkers v. Marshall, 647 F.2d 1189, 1208 (D.C. Cir. 1980) (quoting United States v. Morgan, 313 U.S. 409, 421 (1941)). Further, ‘‘[w]hether the official is engaged in adjudication or rulemaking,’’ the fact that he or she ‘‘has taken a public position, or has expressed strong views, or holds an underlying philosophy with respect to an issue in dispute cannot overcome that presumption.’’ Id. That presumption also is not overcome ‘‘when the official’s alleged predisposition derives from [his or] her participation in earlier proceedings on the same issue.’’ Id. at 1209. Expanding on the latter point, the D.C. Circuit has explained that ‘‘[t]o disqualify administrators because of opinions they expressed or developed in earlier proceedings would mean that ‘experience acquired from their work . . . would be a handicap instead of an advantage.’ ’’ Id. (quoting FTC v. Cement Inst., 333 U.S. 683, 702 (1948)). More recently, the D.C. Circuit has similarly emphasized that it would ‘‘eviscerate the proper evolution of policymaking were we to disqualify every administrator who has opinions on the correct course of his agency’s future actions.’’ Air Transp. Ass’n of America, Inc., 663 F.3d at 488 (quoting C & W Fish Co., 931 F.2d at 1565). Accordingly, the fact that the Board Members previously have expressed views on the subjects of this rulemaking is insufficient to demonstrate that they have engaged in this rulemaking with unalterably closed minds. See Air Transp. Ass’n of America, Inc., 663 F.3d at 487–488; Steelworkers, 647 F.2d at 1208–1209. Indeed, after considering all of the submitted comments, we have revised the proposed rule in various respects. This in itself demonstrates that the Members did not engage in this endeavor with unalterably closed minds. One commenter contends that although the Board’s stated goal is to protect employees’ rights, in many recent cases the Board has sought to VerDate Sep<11>2014 19:25 Mar 31, 2020 Jkt 250001 destabilize bargaining relationships and to allow employers to undermine unions, often under the guise of protecting employee choice.19 We do not agree that either this rule or the cited, recent cases demonstrate an intention to destabilize bargaining relationships or to allow employers to undermine unions. Nor do we believe that either this rule or the cited cases are likely to have those effects. Accordingly, we disagree with this comment. Other commenters contend that here and in other areas, the Board is using rulemaking simply to reverse precedent that it does not like.20 However, like case adjudication, rulemaking involves reasoned decision-making, conducted within the constraints of the APA and subject to judicial review. As demonstrated here and below, we have carefully considered all comments with an open mind, and we believe that the final rule we have formulated represents our reasoned determination regarding the appropriate standards for furthering the various policies discussed herein, including—and especially—protecting employee free choice. C. Alleged Procedural Errors One commenter claims that the Board committed procedural errors in two ways. First, the commenter claims that the Board majority did not provide the dissenting Member adequate time to prepare her dissent, citing her statement that she had not been given sufficient time to review all of the relevant data in the appendices to the NPRM.21 Second, the commenter claims that the Board did not provide interested parties adequate time to prepare their comments on the proposed rule.22 Specifically, the commenter notes that the Board denied its third motion for an additional 30 days to file comments, despite the fact that the commenter still had six Freedom of Information Act (FOIA) requests pending before the Board.23 According to the commenter, the documents that it has sought are essential to evaluate both the empirical 19 Comment of UFCW (citing Mike-Sell’s Potato Chip Co., 368 NLRB No. 145 (2019); Valley Hospital Medical Center, Inc. d/b/a Valley Hospital Medical Center, 368 NLRB No. 139 (2019); MV Transportation, Inc., 368 NLRB No. 66 (2019); Johnson Controls, Inc., 368 NLRB No. 20 (2019); Metalcraft of Mayville, Inc., 367 NLRB No. 116 (2019); Raytheon Network Centric Systems, Inc., 365 NLRB No. 161 (2017)). 20 Comments of AFL–CIO; UFCW. 21 Comment of AFL–CIO (citing 84 FR at 39947 fn. 74). See also Comment of Senator Patty Murray. 22 Comment of AFL–CIO. 23 Comment of AFL–CIO. As the commenter acknowledges, the Board provided responsive documents to its other FOIA requests before the extended comment period closed. PO 00000 Frm 00008 Fmt 4701 Sfmt 4700 foundation of the proposed rule and the integrity of the rulemaking process.24 As an initial matter, we reject the unsubstantiated claim of the dissenting Member that she lacked adequate time to prepare her dissent.25 Moreover, the Board has previously stated that it ‘‘does not believe that it is required, either by law or agency practice, to delay the adoption and publication of a final rule in order to accommodate a dissenting Member. Nothing in the APA compels that course of action, nor does the National Labor Relations Act demand it. Neither do the Board’s rules, statements of procedure, internal operating procedures, or traditional practices, which do not address the internal process of rulemaking, compel such action.’’ Representation—Case Procedure, 76 FR 80138, 80146 (Dec. 22, 2011) (footnotes omitted). There is no reason that this observation should not apply with equal force to issuance of an NPRM. In any event, however, we assure the public that Member McFerran was provided sufficient time to prepare her dissent. Further, the evidence that Member McFerran stated she lacked sufficient time to address was the supplemental Board data cited in reference to a prior non-Board study and expressions of concern by two respected academics about the adverse impact of the blocking-charge policy. See 84 FR at 39933, 39947. Some of the same data is at issue in the cited items sought in the commenter’s FOIA request.26 As discussed in Section III.E. below, even accepting that some of the data that the NPRM cited is flawed, we continue to believe that the record supports finding a systemic problem of unacceptable election delays resulting from the 24 Comment of AFL–CIO. Air Trans. Ass’n of America, Inc. v. NMB, 663 F.3d at 487–488 (court denied challenge to National Mediation Board’s rule based on majority’s action providing dissenter only 24 hours to consider and prepare dissent, which she did). 26 The commenter’s Request #2 seeks ‘‘[a]ny document that contains or evidences any analysis of the impact of the adoption of 29 CFR 103.20 on the number of blocking charges, the time needed to process blocking charges, the delay caused by blocking charges, or any other case processing outcomes.’’ AFL–CIO’s Aug. 29, 2019 FOIA Request at 2. The commenter’s Request #5 seeks ‘‘[a]ny document containing or evidencing any explanation of any decision to aggregate multiple blocking periods (even when they ran or are running concurrently) in producing the table in Appendix A [sic] to the NPRM.’’ Id. And the commenter’s Request #13 seeks ‘‘[a]ny documents containing or evidencing a comparison of the disposition of unfair labor practice charges filed by unions accompanied by or followed by requests to block an election and the disposition of unfair labor practice charges filed by unions not accompanied or followed by such a request.’’ Id. at 3. 25 Accord E:\FR\FM\01APR2.SGM 01APR2 Federal Register / Vol. 85, No. 63 / Wednesday, April 1, 2020 / Rules and Regulations jbell on DSKJLSW7X2PROD with RULES2 blocking-charge policy.27 We also note that Member McFerran was able to prepare a comprehensive ‘‘preliminary’’ review of blocking-charge information for Fiscal Years 2016 and 2017 independent of the data relied on by the majority or provided to the public in the past. 84 FR at 39943–39944. Likewise, during the comment period, Professor John-Paul Ferguson prepared an extensive review of data provided to the AFL–CIO that was appended to its comment. Yet another review critical of the Board majority’s analysis in the NPRM was prepared by Bloomberg Law and cited by commenters in opposition to the proposed blocking-charge rule.28 Consequently, there is no basis for finding that the dissenting Board Member was prejudiced by the alleged lack of time to review the data originally cited or that, with respect to its FOIA requests 2, 5, or 13, the commenter was prejudiced by the denial of its request for an extension of time.29 The commenter also requested ‘‘[a]ny analysis of the effect or impact of Dana Corp., 351 NLRB 434 (2007), other than those contained in the opinions in Lamons Gasket, 357 NLRB 739 (2011).’’ AFL–CIO’s Aug. 29, 2019 FOIA Request at 3 (Request #19). However, in issuing the final-rule amendment regarding the voluntary-recognition bar, we do not rely on any data, or analysis of data, other than that discussed in Dana and in Lamons Gasket, which we have fully considered. In these circumstances, we find no basis for concluding that the commenter was prejudiced by the denial of its request for an extension of time with regard to this FOIA request. Further, the commenter requested ‘‘[a]ny documents containing or evidencing any statement by any Board member concerning the validity, wisdom or soundness of the Board’s blocking[-]charge policy; Lamons Gasket Co., 357 NLRB 739 (2011); Dana Corp., 351 NLRB 434 (2007); or conversion of 8(f) to 9(a) relationships.’’ AFL–CIO’s Aug. 29, 2019 FOIA Request at 4 (Request #22). According to the commenter, the requested documents 27 As the AFL–CIO concedes: ‘‘Blocking elections delays elections. That is undeniably true and requires no ‘statistical evidence’ to demonstrate.’’ Comment of AFL–CIO at 5. 28 See Alex Ebert and Hassan A. Kanu, Federal Labor Board Used Flawed Data to Back Union Election Rule, Bloomberg Law (Dec. 5, 2019), https://news.bloomberglaw.com/daily-labor-report/ federal-labor-board-used-flawed-data-to-backunion-election-rule-1. 29 We emphasize that our response to this comment only addresses the argument that the failure to provide remaining requested documents was prejudicial to the commenter’s ability to evaluate the rulemaking process. We express no opinion concerning whether any of the requested information is disclosable under FOIA. VerDate Sep<11>2014 19:25 Mar 31, 2020 Jkt 250001 are relevant to the Board Members’ alleged ‘‘predisposition and bias’’ and their ability ‘‘to fairly evaluate comments as required by the APA.’’ 30 As discussed in Section III.B. above, however, the mere fact that Board Members previously have expressed opinions regarding these matters does not provide a basis for concluding that they have approached these issues with closed minds. That would be the case under applicable precedent even if we were issuing a final rule identical to the proposed rule, but it is even more clearly the case given that we have modified the proposed rule in response to comments. Therefore, there is no basis for finding that the commenter was prejudiced by not receiving this requested information before the end of the comment period. Finally, one of the commenter’s FOIA requests was for ‘‘[a]ny document containing or evidencing any limitations of the time allowed Member McFerran to prepare her dissent to the NPRM, any limitations on the access allowed Member McFerran to case processing information or data she deemed necessary to prepare her dissent, or any limitations on access to NLRB or General Counsel staff she deemed necessary to prepare her dissent.’’ AFL– CIO’s Aug. 29, 2019 FOIA Request at 3 (Request #21). As discussed above, however, we reject any suggestion that Member McFerran had inadequate time to prepare her dissent. We likewise reject the unfounded suggestion that there was any limitation on her ability to access necessary resources to prepare that dissent. Inasmuch as there is neither statutory authority nor binding Board practice requiring that a dissenting member has the right to any amount of time to prepare a dissent, the material question here is simply whether the commenters have had sufficient time to provide their comments. Preliminarily, the APA provides no minimum comment period, and many agencies, including the Board in past rulemaking proceedings, have afforded comment periods of only 30 days. Agencies have discretion to provide still shorter periods and are simply ‘‘encouraged to provide an appropriate explanation for doing so.’’ Admin. Conference of the U.S., Recommendation 2011–2, Rulemaking Comments, 76 FR 48791 (Aug. 9, 2011). As noted previously, the NPRM, which issued on August 12, 2019, set an initial comment period of 60 days, with 14 additional days allotted for reply comments. Although the APA does not require a reply period, the Board 30 Comment PO 00000 of AFL–CIO. Frm 00009 Fmt 4701 Sfmt 4700 18373 provided it to give itself the best opportunity to gain all information necessary to make an informed decision. Then, the Board extended the comment and reply periods twice, for 90 additional days. In sum, the Board has accepted comments on 3 proposed amendments to its representation-case procedures for a total of 164 days.31 We believe that the more than 80 comments submitted and the depth of analysis that many of them provide, including the comment and reply from the AFL–CIO, are a testament to the adequacy of the comment period. As such, we do not believe that this commenter was prejudiced by the fact that, at the closing of the extended comment period, the Board had not yet provided all documents responsive to its broad FOIA request. Accordingly, we reject the commenter’s claims regarding alleged procedural errors. D. Matters Outside the Scope of This Rulemaking Several commenters propose that we take various other actions,32 but because those actions are outside the scope of this rulemaking, we decline to take them.33 E. Final-Rule Amendment Regarding Blocking-Charge Policy The Board received numerous comments on the amendment concerning the blocking-charge policy. We have carefully reviewed and considered these comments, as discussed below. 1. Comments in Favor of, and Comments Opposed to, Changing the Blocking-Charge Policy by Eliminating the Practice of Delaying Elections As stated above, the NPRM proposed that the current blocking-charge policy be revised to provide that a request to block would no longer delay the processing of an otherwise valid 31 We note that in a prior rulemaking of far greater scope, involving 25 proposed amendments to a wide range of representation-case procedures, the Board found that acceptance of comments on these proposals for a total of 141 days, and 4 days of public hearings, was adequate. See 79 FR at 74311. 32 See Comments of Center on National Labor Policy, Inc. (CNLP) (suggesting raising the Board’s jurisdictional standards); Anonymous (suggesting that the Board address the unfair labor practice investigation process); National Federation of Independent Business (NFIB) (suggesting proposing particular legislation to Congress); Coalition for a Democratic Workplace (CDW) (suggesting rulemaking to rescind and revise the Board’s 2015 Election Rule). 33 However, with regard to the recommendation to rescind and revise the Board’s 2015 Election Rule, we note that we already have revised that Rule in certain respects. See 2019 Election Rule, 84 FR 69524. E:\FR\FM\01APR2.SGM 01APR2 18374 Federal Register / Vol. 85, No. 63 / Wednesday, April 1, 2020 / Rules and Regulations petition and the timely conduct of an election. Under the proposed rule, if the blocking charge is still pending upon conclusion of the election, ballots would be impounded and not counted until there is a final determination regarding the charge and its effect, if any, on the election petition or fairness of the election. Not surprisingly, the commenters on the blocking-charge policy tend to fall into two sharply divided groups. Commenters in the first group support the proposed modification and urge the Board to require regions to process representation petitions despite a request to block based on a pending unfair labor practice charge. One commenter cites the mandate in Section 9(c) of the Act that, ‘‘[i]f the Board finds . . . that . . . a question of representation exists, it shall direct an election by secret ballot and shall certify the results thereof.’’ 34 According to this commenter, the blocking-charge policy is an administrative fiction that the Board has used to evade its statutory responsibility.35 A second commenter suggests that the blocking-charge policy is contrary to Section 8(a)(2) of the Act, 29 U.S.C. 158(a)(2), because it permits unions to serve as employees’ representative where a majority of the employees do not support union representation.36 And another commenter notes that, under the Act, the Board may not defer representation proceedings to the General Counsel, which is allegedly what occurs when the processing of elections depends on whether the General Counsel issues a complaint.37 Several commenters cite the adverse impact on employees when they are forced to wait indefinitely to vote in a representation election.38 In this regard, commenters assert that delaying the election punishes employees for the misconduct alleged in an unfair labor practice charge, even if they had no role in that alleged misconduct.39 Commenters also contend that an indefinite delay in an election affects employees’ vote when the election is finally held. For instance, it causes some employees to perceive the Board and its processes as futile.40 Further, the 34 Comment of CNLP (quoting 29 U.S.C. 159(c)). 35 Id. 36 Comment of CDW. of CNLP. 38 Comments of Council on Labor Law Equality (COLLE); Representatives Virginia Foxx and Tim Walberg; General Counsel Peter Robb (GC Robb); CNLP; CDW; Chamber of Commerce (the Chamber). 39 Comments of Associated Builders and Contractors (ABC); National Right to Work Legal Defense Foundation, Inc. (NRWLDF). 40 Comments of CDW; COLLE. jbell on DSKJLSW7X2PROD with RULES2 37 Comment VerDate Sep<11>2014 19:25 Mar 31, 2020 Jkt 250001 election’s delay denies employees the opportunity to vote while the issues surrounding the petition effort for an election are fresh in their minds.41 Commenters also echo the concern expressed in the NPRM about turnover in the workforce during the delay caused by a blocking charge, with the result that employees who supported the petition may not be the ones who vote on the representation issue when the election is finally held.42 One commenter notes the adverse effect of blocking-charge delays on constructionindustry employees working under a Section 8(f) agreement—a majority of whom may never have supported the union representative—who seek to decertify the union through a Board election.43 One employee commenter notes his own frustration that, for years, he was unable to vote in an election to remove an incumbent union as his bargaining representative because the union filed unfair labor practice charges.44 Meanwhile, a union local commenter expresses support for modifying the blocking-charge policy because of how important it is for employees to express their choice on union representation without delays to create a more level playing field in the organizing process.45 Some commenters argue that employers, too, are harmed when meritless unfair labor practice charges block an election. One commenter notes that, as the Board acknowledged in the NPRM, blocking charges can deprive employers of the supposed ‘‘safe harbor’’ in filing an RM election petition that the Board majority referenced in Levitz Furniture Co. of the Pacific, 333 NLRB at 726, as an alternative to the option of withdrawing recognition (which the employer selects at its peril).46 Another commenter notes the adverse effect on an employer signatory to a construction-industry collectivebargaining agreement negotiated under Section 8(f) by a union without majority support. Although an election petition can be filed at any time during the contract term, a blocking charge can indefinitely postpone an election that could result in decertification of the union and voiding the contract.47 One commenter also states that when meritless unfair labor charges are filed to delay an election, the Board must 41 Comment of GC Robb. of COLLE; CDW. 43 Comment of CNLP. 44 Comment of Donald Johnson. 45 Comment of International Brotherhood of Electrical Workers Local 304 (Local 304). 46 Comment of CDW. 47 Comment of CNLP. 42 Comment PO 00000 Frm 00010 Fmt 4701 Sfmt 4700 needlessly waste its resources in conducting a pointless investigation, and employers are forced to expend limited funds in defending against such allegations.48 Several commenters assert the current blocking-charge policy is too often used as an attempt to rig the rules.49 One commenter notes that blocking charges overwhelmingly affect decertification elections, and that those elections are delayed the longest.50 Another commenter compares the current policy to an incumbent U.S. officeholder being able to decide when and under what circumstances to submit to a future election.51 According to some commenters, this is because a union, aware of a lack of employee support, may simply choose to file an unfair labor practice charge to forestall an election, potentially for as long as necessary until it believes it can prevail.52 In addition to receiving a temporary delay, the union may hope that, by chance, a regional director’s investigation may discover evidence of other conduct that becomes the basis for issuing a complaint that delays the election even longer.53 One commenter claims that the passage of time, employee turnover, and other changed circumstances may give the union the chance of hanging on as employees, exasperated by their inability to obtain an election, decide to leave.54 Additionally, one commenter contends, the union continues to represent the employees indefinitely and may use that time to pressure them into voting for it, if an election ever does occur.55 According to one commenter, employee free choice eventually turns into employees having no choice at all because the union effectively gets to decide whether an election is held—and the union will always pick its own survival over the preference of unit employees.56 Thus, one commenter notes, the current policy leads to an undemocratic charade that forces employees to endure a prolonged, if not futile, wait before being able to exercise their right to express their free choice as to whether to be represented.57 The group of commenters opposed to change in the current blocking-charge 48 Comment of NRWLDF. of GC Robb; NRWLDF; the Chamber. 50 Comment of CDW. 51 Comment of COLLE. 52 Comments of COLLE; Representatives Foxx and Walberg; NRWLDF. 53 Comment of NRWLDF. 54 Comment of CDW. 55 Comment of the Chamber. 56 Comment of NRWLDF. 57 Comment of Representatives Foxx and Walberg. 49 Comments E:\FR\FM\01APR2.SGM 01APR2 jbell on DSKJLSW7X2PROD with RULES2 Federal Register / Vol. 85, No. 63 / Wednesday, April 1, 2020 / Rules and Regulations policy focus on situations where an allegedly meritorious unfair labor practice charge taints a representation petition or otherwise spoils laboratory conditions for conducting an election, thereby preventing employees from making a truly free choice as to union representation. Some of those commenters argue that it would be inconsistent with Section 9(c) of the Act for a regional director to process a representation petition in those circumstances because the regional director would not have ‘‘reasonable cause to believe’’ that a question of representation exists—a prerequisite to an election under Section 9(c).58 One commenter claims that a meritorious unfair labor practice charge alleging that an employer unlawfully instigated or supported a petition to displace an incumbent union precludes a question of representation because, in those circumstances, the employer has improperly circumvented Congress’s intent—set forth in Section 9(c)(1)—to allow employers to file only RM petitions.59 That same commenter also states that a meritorious unfair labor practice charge alleging that an employer violated Section 8(a)(5) by ceasing to recognize and bargain with the incumbent union precludes a question of representation because displacing the union through an election would be inconsistent with the Board’s obligation to remediate the Section 8(a)(5) violation with a bargaining order.60 Finally, the commenter states that a meritorious unfair labor practice charge against an employer that caused the union’s loss of majority support precludes a question of representation because the required showing of interest would be supported by coerced evidence.61 Relatedly, another commenter states that, where certain unlawful conduct has been committed, conducting elections would be a betrayal of the Board’s statutory responsibility.62 Several commenters assert various ways in which holding an election in spite of a blocking-charge request would harm employees voting in the election. In this connection, commenters contend that, after employees have been coerced to vote against the union in an initial election that has been set aside based on conduct subject to the blocking charge, the union will be forced to convince them to change their minds in a rerun election.63 One commenter states generally that pollsters and statisticians who study cognitive biases have shown the long-term effect of coercive behavior.64 Another commenter asserts that it is unfair to hold an election while employees do not know whether the unfair labor practice charge has merit.65 Additionally, several commenters express concerns that having employees vote in elections that are set aside will engender a belief that exercising rights under the Act is futile, or that Board elections are somehow fixed.66 Other commenters contend that holding an election while the unfair labor practice charge is pending creates an impression that the charge necessarily lacks merit, based on the belief that the Board would not spend the time, money, and other resources on an initial election if it believes that it might need to hold a rerun election.67 Another commenter states that the Supreme Court recognized in NLRB v. Gissel Packing Co., 395 U.S. at 575, that employees cannot ‘‘freely determine whether they desire a representative’’ where the employer has committed unfair labor practices that undermined the union’s support and impeded the holding of a free and fair election.68 Some commenters complain that the proposed rule provides for holding an election even if an employer has engaged in egregious misconduct, such as threatening to shoot any employee voting for union representation.69 Commenters also assert that it would be an arbitrary waste of agency and party resources to conduct elections that 58 Comments of AFL–CIO; Workers United, SEIU; Communication Workers of America, AFL–CIO (CWA). 59 Comment of Workers United. 60 Id. 61 Id. 62 Comment of Economic Policy Institute (EPI). Another commenter contends that processing a representation petition where there is an unfair labor practice allegation that previously would have blocked an election would violate the First and Fourteenth Amendments to, and the Take Care Clause of, the U.S. Constitution, and that it also raises separation-of-powers concerns. See Comment of National Nurses United (NNU) (citing Thomas v. Collins, 323 U.S. 516 (1945)). This commenter does not explain its argument, and the cited decision does not support the commenter’s claim. Thus, we reject this claim as unsupported. 63 Comments of SEIU; AFL–CIO; Kimberly Holdiman; NNU; United Association of Journeymen and Apprentices of the Plumbing and Pipe Fitting Industry of the United States and Canada, AFL–CIO (UA); American Federation of Teachers, AFL–CIO (AFT); CWA; Utility Workers of America, AFL–CIO (UWUA). 64 Comment of International Union of Operating Engineers (IUOE). 65 Comment of Jay Youngdahl. 66 Comments of SEIU; UFCW; UA; LIUNA MidAtlantic Regional Organizing Coalition (LIUNA MAROC). 67 Comments of CWA; Senator Murray. 68 Comment of International Brotherhood of Electrical Workers, AFL–CIO, CLC (IBEW). 69 Comments of SEIU; IUOE; Michigan Regional Council of Engineers and Millwrights (MRCC); Senator Murray. VerDate Sep<11>2014 19:25 Mar 31, 2020 Jkt 250001 PO 00000 Frm 00011 Fmt 4701 Sfmt 4700 18375 will have to be invalidated, such as where the employer indisputably assisted with or actually solicited petition signatures.70 And other commenters argue that conducting an election will not serve any purpose because a union would not be certified or decertified any sooner. Votes will remain impounded until resolution of the pending blocking-charge allegations.71 Several commenters also assert that the proposed modification of blockingcharge policy is not supported by empirical data under the current policy that would be relevant to a determination of how many blocking charges were meritorious.72 Commenters also criticize inaccuracies in statistics cited by the Board majority in the NPRM with respect to the number of cases where petitions have been blocked and the length of time they were blocked under the current policy.73 Some commenters state that the Board has failed to consider statistics showing that evidentiary requirements implemented in the 2015 Election Rule have sufficiently addressed any concerns about the current blocking-charge policy.74 Finally, some commenters contend that the Board’s concern about election delay resulting from the blocking-charge policy is inconsistent with the election delays that will result when the 2019 Election Rule takes effect.75 Having thoroughly considered the foregoing comments, we agree with those who contend that the current blocking-charge policy must be modified to provide for the timely processing of an otherwise valid petition, at least to the point of conducting an election. We remain of the view expressed in the NPRM that this approach ‘‘best satisfies the goal of protecting employee free choice . . . by assuring that petitions will be processed to an election in the same timely manner as in unblocked[-]petition cases.’’ 84 FR at 39938. Accordingly, the final-rule amendment provides that a blocking-charge request will no longer delay the conduct of an election in any case. As discussed in the following 70 Comments of AFL–CIO; NNU; UFCW; UA; IBEW; AFT; Senator Murray; American Federation of State, County and Municipal Employees (AFSCME); EPI. 71 Comments of AFL–CIO; Youngdahl; LIUNA MAROC. 72 Comments of AFL–CIO; IUOE; LIUNA MAROC; Senator Murray; SEIU; UA; UFCW. 73 Comments of AFL–CIO; AFT; IBEW; MRCC; SEIU; UA; UFCW. 74 Comments of AFSCME; AFL–CIO; CWA; IBEW; Youngdahl; UFCW; Professor Alexia Kulwiec. 75 Comments of AFT; EPI; SEIU, Local 32BJ (Local 32BJ); UFCW; UWUA; Professor Kulwiec. E:\FR\FM\01APR2.SGM 01APR2 18376 Federal Register / Vol. 85, No. 63 / Wednesday, April 1, 2020 / Rules and Regulations jbell on DSKJLSW7X2PROD with RULES2 section, however, we also agree with comments suggesting that the vote-andimpound procedure proposed in the NPRM need only apply to a limited class of charges and that in all other cases votes should be counted upon conclusion of the voting. Initially, we disagree with the contention, advanced by several commenters opposing the proposed rule, that the Board lacks the statutory authority to direct elections in the face of some, or even all, blocking charges. Section 9(c)(1) provides that the Board ‘‘shall direct an election’’ if it finds that ‘‘a question of representation exists.’’ It makes no reference to the effect of a pending unfair labor practice charge on an otherwise valid election petition. Similarly, the Board’s current election rules, implemented in 2015, state that ‘‘[a] question of representation exists if a proper petition has been filed concerning a unit in which an individual or labor organization has been certified or is being currently recognized by the employer as the bargaining representative.’’ 29 CFR 102.64(a).76 Consistent with this definition, the existence of a question concerning representation is not per se affected by the pendency of a charge alleging conduct that, if proven, would interfere with employee free choice in the election. If it were, then the Board would lack the discretion to direct an election if such charges were pending, regardless of whether a request to block has been made—a position wholly at odds with the Board’s longstanding procedures, which allow elections to take place despite the pendency of charges in certain circumstances, even Type II charges.77 Indeed, longstanding Board procedures permit the processing of a petition and conduct of an election at the discretion of the charging party who files an unfair labor practice charge or at the discretion of the regional director upon consideration of whether 76 The Board’s 2019 Election Rule revisions to its existing election rules relevantly state: ‘‘A question of representation exists if a proper petition has been filed concerning a unit appropriate for the purpose of collective bargaining or concerning a unit in which an individual or labor organization has been certified or is being currently recognized by the employer as the bargaining representative.’’ 84 FR 69524, at 69593 (December 18, 2019) (to be codified at 29 CFR 102.64(a)). The minor differences between the 2015 and 2019 rules do not affect our analysis of the issues presented here. 77 Type II Blocking Charges are charges that affect the petition or showing of interest, that condition or preclude a question concerning representation, or that taint an incumbent union’s subsequent loss of majority support. NLRB Casehandling Manual (Part 2) Representation Proceedings Sec. 11730.3 (Jan. 2017). VerDate Sep<11>2014 19:25 Mar 31, 2020 Jkt 250001 circumstances permit an election in spite of pending charges.78 Turning to the fundamental issue whether any of the unproven unfair labor practice charges currently described as Type I and II charges in the Board’s Casehandling Manual (Part 2) Representation Proceedings should be allowed to block the immediate processing of a petition and conduct of an election, we agree with the commenters who contend that, in some cases, meritless unfair labor practice charges are filed to prevent employees from exercising their right to vote. As some commenters note, ending the policy of blocking elections reduces the incentives for filing meritless unfair labor practice charges and the uncertainty as to whether employees would ever have the opportunity to vote.79 At the very least, as one commenter noted, it would prompt unions to think twice before filing meritless unfair labor practice charges because they would not be able to unnecessarily deprive employees of their right to express their free choice.80 Further, as discussed in the NPRM, several federal appellate courts have expressed concerns about the impact of meritless unfair labor practice charges blocking elections. See NLRB v. Hart Beverage Co., 445 F.2d at 420 (‘‘[I]t appears clearly inferable to us that one of the purposes of the [u]nion in filing the unfair practices charge was to abort [r]espondent’s petition for an election, if indeed, that was not its only purpose.’’); Templeton v. Dixie Color Printing Co., 444 F.2d at 1069 (‘‘The short of the matter is that the Board has refused to take any notice of the petition filed by appellees and by interposing an arbitrary blocking[-]charge practice, applicable generally to employers, has held it in abeyance for over 3 years. As a consequence, the appellees have been deprived during all this time of their statutory right to a representative ‘of their own choosing’ to bargain collectively for them, 29 U.S.C. 157, despite the fact that the employees have not been charged with any wrongdoing. Such practice and result are intolerable under the Act and cannot be countenanced.’’); NLRB v. Midtown Service Co., 425 F.2d at 672 (‘‘If . . . the 78 See NLRB Casehandling Manual (Part 2) Representation Proceedings Sec. 11731.2, .5, and .6. We note that our final-rule amendment of blockingcharge policy does not alter current law requiring that allegations that the individual filing a decertification petition is a supervisor raise jurisdictional issues that must be resolved in the representation case before an election may be directed. See Modern Hard Chrome Service Co., 124 NLRB 1235, 1236–1237 (1959). 79 Comments of CDW; the Chamber. 80 Comment of the Chamber. PO 00000 Frm 00012 Fmt 4701 Sfmt 4700 charges were filed by the union, adherence to the [blocking-charge] policy in the present case would permit the union, as the beneficiary of the [e]mployer’s misconduct, merely by filing charges to achieve an indefinite stalemate designed to perpetuate the union in power. If, on the other hand, the charges were filed by others claiming improper conduct on the part of the [e]mployer, we believe that the risk of another election (which might be required if the union prevailed but the charges against the [e]mployer were later upheld) is preferable to a threeyear delay.’’); NLRB v. Minute Maid Corp., 283 F.2d at 710 (‘‘Nor is the Board relieved of its duty to consider and act upon an application for decertification for the sole reason that an unproved charge of an unfair practice has been made against the employer. To hold otherwise would put the union in a position where it could effectively thwart the statutory provisions permitting a decertification when a majority is no longer represented.’’); Pacemaker Corp v. NLRB, 260 F.2d at 882 (‘‘The practice adopted by the Board is subject to abuse as is shown in the instant case. After due notice both parties proceeded with the representation hearing. Possibly for some reasons of strategy near the close of the hearing, the [u]nion asked for an adjournment. Thereafter it filed a second amended charge of unfair labor practice. By such strategy the [u]nion was able to and did stall and postpone indefinitely the representation hearing.’’). We believe that it would be inappropriate for the Board to continue to disregard these valid concerns that the current blocking-charge policy encourages such gamesmanship, allowing unions to dictate the timing of an election for maximum advantage in all elections presenting a test of representative status.81 The Board has long been aware of the potential—and actuality—of such gamesmanship and has taken certain measures to discourage it. Section 11730 of the Board’s current Casehandling Manual for representation proceedings states that ‘‘it should be recognized that the policy is not intended to be misused by a party as a tactic to delay the resolution of a question concerning representation raised by a petition.’’ Further, while declining to modify the blocking-charge 81 As comments make clear, the discretionary ability of a union to affect the timing of an election through a blocking charge exists not only for decertification election (RD) and deauthorization (UD) petitions filed by individual employees, but also for representation-election petitions filed by a union (RC) or employer (RM). E:\FR\FM\01APR2.SGM 01APR2 jbell on DSKJLSW7X2PROD with RULES2 Federal Register / Vol. 85, No. 63 / Wednesday, April 1, 2020 / Rules and Regulations policy in the 2015 Election Rule, the Board did state that it was ‘‘sensitive to the allegation that at times, incumbent unions may abuse the policy by filing meritless charges in order to delay decertification elections,’’ 82 and it sought to address that issue by including a provision in § 103.20 of the Board’s Rules and Regulations requiring that a charging party that files a blocking request must simultaneously provide an offer of proof with names of witnesses and a summary of their anticipated testimony. We agree that this new evidentiary requirement would likely facilitate the quick elimination of obviously meritless charges and blocking requests based on them, and thereby permit processing of some petitions with minimal delay. We also accept as plausible the contention by some commenters that the requirement may be partly responsible for a decline in blocked petitions since implementation of the 2015 Election Rule.83 But even assuming the decline is, to some extent, attributable to the offer-of-proof requirement, we nevertheless find that this decline alone does not justify adherence to the current blocking-charge policy. A regional director typically acts on a blockingcharge request soon after the request is made, if not on the same day, and a charge that appears facially sufficient based on an offer of proof may yet be dismissed as meritless after full investigation or may ultimately be withdrawn. Meanwhile, under the current policy, an election is delayed until that happens. Further, our concerns and those expressed by commenters about the current policy extend to meritorious charges as well. Proponents of the current policy take a broad view of what constitutes a meritorious blocking charge. They would include any charge under investigation by the regional director that is not facially meritless and alleges conduct that could reasonably affect the election results or the validity of the election petition. Necessarily, then, they would include any charge on which a regional director decides to issue a complaint, regardless of whether a violation of the Act would ultimately be proven. Based on comments supportive of the dissent’s statistical survey in the NPRM, they would also define as meritorious any blocking charge that resulted in a settlement, without inquiry into the terms of the 82 79 FR at 74419. statistical summary from Professor JohnPaul Ferguson appended to the Comment of AFL– CIO shows a decline but proves no certain basis for inferring the cause of decline. 83 The VerDate Sep<11>2014 19:25 Mar 31, 2020 Jkt 250001 settlement agreement.84 In other words, they view any charge of conduct potentially affecting the validity of a petition or the outcome of an election as presumptively meritorious, for purposes of blocking an election, until it is dismissed or withdrawn. This view stands in sharp contrast to the Board’s, for which a charge is not meritorious unless admitted or so found in litigation. Thus, from the Board’s perspective, the current blocking-charge practice denies employees supporting a petition the right to have a timely election based on charges the merits of which remain to be seen, and many of which will turn out to have been meritless. Moreover, even assuming that some commenters are correct that for every meritless charge there are two ‘‘meritorious’’ charges that have appropriately blocked an election,85 this does not justify the very real consequences that employees experience when unfair labor practice charges indefinitely delay their ability to vote. We also acknowledge the claims in the dissent to the NPRM and by some commenters that there were errors in some of the data that the NPRM majority cited to support the proposed rule and that these errors led to exaggeration both of the number of cases delayed and the length of delay involved.86 Even accepting those claims as accurate, the remaining undisputed statistics substantiate the continuing existence of a systemic delay that supports our policy choice to modify the current blocking-charge procedure that does not, and need not, depend on statistical analysis. As the AFL–CIO candidly acknowledges, ‘‘[b]locking elections delays elections. That is undeniably true and requires no ‘statistical evidence’ to demonstrate.’’ We agree. Furthermore, anecdotal evidence of lengthy blockingcharge delays in some cases, and judicial expressions of concern about this, remain among the several persuasive reasons supporting a change that will assure the timely conduct of elections without sacrificing protections against election interference. For instance, in Cablevision Systems Corp., 367 NLRB No. 59, employees were forced to wait years for a regional director to process a decertification 84 See List of FY 2016 and FY 2017 Petitions Blocked Pursuant to Blocking Charge Policy in Dissent Appendix, https://www.nlrb.gov/sites/ default/files/attachments/basic-page/node-7583/ member-mcferran-dissent-appendix.pdf (last visited Mar. 23, 2020). 85 Comments of Workers United; AFL–CIO; IUOE; UFCW; Senator Murray. 86 Comments of Workers United; AFL–CIO; IBEW; AFT; UA; UFCW; MRCC. PO 00000 Frm 00013 Fmt 4701 Sfmt 4700 18377 petition because of a blocking charge— so long, in fact, that the employee who filed the petition ultimately withdrew it and the employees were denied the right to vote. That case was by no means an anomaly. In ADT Security Services, No. 18–RD–206831, 2017 WL 6554381 (Dec. 20, 2017), the petitioner filed a decertification petition after personally gathering the required showing of interest. The union filed a blocking charge falsely alleging employer involvement. Although the union eventually withdrew its frivolous charge, it succeeded in blocking an election for several months.87 Likewise, in Arizona Public Service Co., No. 28– RD–194724, 2017 WL 2794208 (June 27, 2017), the petitioner filed a decertification petition with the required showing of interest. The union filed a blocking charge alleging employer involvement. The union eventually withdrew the charge and lost the subsequent election but was successful in delaying its ouster for nearly 3 months.88 Additionally, in Pinnacle Foods Group, LLC, No. 14–RD– 226626, 2019 WL 656304 (Feb. 2, 2019), the petitioner filed a decertification petition supported by the requisite showing of interest. The union filed a charge alleging employer involvement and the employer’s failure to meet its bargaining obligations. The region immediately blocked the petition without seeking any input from the employer or the petitioner. Although the region eventually issued a complaint on relatively minor violations of the Act, it dismissed the allegations of employer involvement in soliciting support for the decertification petition. Under the blocking-charge policy, the regional director declined to process the decertification petition, even though it was filed 18 months after the union’s certification and 12 months after the parties began bargaining—but only days after the decertification petition was filed, suggesting that its primary purpose was merely to forestall the decertification election.89 Then, one commenter asserts, there is the case of the employees at Apple Bus Co. in Soldotna, Alaska, who were forced to wait years for a decertification election because of blocking charges until the union ultimately disclaimed interest in continuing representation.90 Cases such as these demonstrate how a blocking charge can postpone an election, even for years, seriously 87 See 88 See Comment of NRWLDF. id. 89 Id. 90 Id. (citing Apple Bus Co., Case 19–RD–216636, 2019 WL 7584368 (Nov. 18, 2019)). E:\FR\FM\01APR2.SGM 01APR2 18378 Federal Register / Vol. 85, No. 63 / Wednesday, April 1, 2020 / Rules and Regulations harming the interests of employees who wanted it. Although some commenters assert that blocking charges are not to blame for the unacceptably lengthy delay of elections in certain cases,91 it is undisputed that blocking charges delay elections. In this regard, it takes time for the General Counsel to investigate a charge and, on occasion, to litigate a complaint based on the charge.92 We believe that it is our obligation to prevent this needless delay of employees’ exercise of their right to express their free choice regarding union representation in a timely held election. Additionally, we believe that the concerns raised about the harm that employees would suffer by voting in an election that is later set aside are overstated and can be addressed by the prophylactic post-election procedures of certification stays and, in some cases, impounding ballots, set forth in the final rule. We also note that from the Board’s earliest years, it has set aside the results of elections based on meritorious objections and has ordered second elections. See, e.g., Paragon Rubber Co., 7 NLRB 965, 966 (1938). In many of those cases, the objectionable conduct was an unfair labor practice. Based on our extensive experience in handling election objections, we reject the notion that employee free choice in a second election will invariably be affected by a prior election loss set aside based on unfair labor practices. That has not been the case in many rerun elections where employees vote for union representation in a second or even third election. In fact, contrary to the suggestion of some commenters, we believe that when the Board orders a second election based on unfair labor practices committed during the critical pre-election period, that sends a positive signal to employees that the Board will protect their free choice when the results of an actual election require doing so. In addition, the Board holds rerun elections only at an appropriate time after the original election is set aside—i.e., after the effects of the unlawful or objectionable conduct have dissipated.93 We also note 91 Comments of AFL–CIO; UA. of CDW. 93 One commenter’s claim that a federal district court in Amirault v. Shaughnessy, No. H–84–113, 1984 WL 49161, at *4 (D. Conn. Feb. 8, 1984), issued a temporary restraining order to halt a unionaffiliation election under the Labor Management Reporting and Disclosure Act (LMRDA) because of what it speculated would be the harmful effect of that election on any subsequent election has no bearing on the issue here. That case not only is inapposite based on its facts—which involved the effect of union-affiliation opponents being denied the opportunity under the LMRDA to present their views before the holding of a special convention jbell on DSKJLSW7X2PROD with RULES2 92 Comment VerDate Sep<11>2014 19:25 Mar 31, 2020 Jkt 250001 that nothing in the Supreme Court’s Gissel decision suggests the inevitability of lingering effects preventing a fair rerun election, much less that an election should be delayed or preempted prior to any finding in adjudication that unfair labor practices have actually been committed. To the contrary, that decision makes clear the Court’s implicit view that typically, fair elections can be held after an employer has undisputedly committed unfair labor practices. A rerun election remains the norm after a first election has been set aside based on such misconduct. The extraordinary alternative of imposing an affirmative bargaining order is warranted only when standard remedies stand no or only a slight chance of ameliorating the lingering effects of adjudicated serious unfair labor practices.94 One commenter notes that, if an election is held but votes are impounded, the workforce may change by the time the election results are certified.95 As discussed below, our final-rule amendment retains the proposed vote-and-impound procedure for only a limited category of cases, but certification will in any event be postponed for some period of time if a blocking charge is still pending when an election concludes. In any event, the commenter’s observation misses the critical point that our concern is with the harmful effects on employee free choice of election delay, rather than with any post-election delay until a certification of results or representative issues. For various reasons previously stated, blocking charges should neither prevent the timely processing of an otherwise valid petition nor preclude those employees who support it from participating in a timely-conducted election. Considering these factors, we disagree with one commenter’s argument that we should maintain the status quo—and its attendant, unnecessary delay in employees’ exercise of free choice—because that delay ‘‘is a small price to pay.’’ 96 We find instead that it is far too great a price for employees to pay. As stated above, several commenters allege that our expressed concern about election delay resulting from the current blocking-charge policy is inconsistent with the 2019 Election Rule.97 They claim that we cannot seriously be vote—but it also was reversed by the court of appeals, reported at 794 F.2d 676 (2d Cir. 1984) (table). See Reply Comment of AFL–CIO. 94 See NLRB v. Gissel Packing Co., supra, 395 U.S. at 610–616. 95 Comment of AFSCME. 96 Comment of Youngdahl. 97 Comments of SEIU; EPI; Local 32BJ. PO 00000 Frm 00014 Fmt 4701 Sfmt 4700 concerned about preventing unnecessary delays in the election process because we provided in that rulemaking for pre-election review of unit-scope and voter-eligibility issues. Implicit in this argument is an assumption that the changes made by that final rule institutionalized ‘‘unnecessary’’ delays. We could not disagree more. As stated in response to the dissent to that rule, the amendments made there were based on the belief that ‘‘the expedited processes implemented in 2014 at every step of the election process . . . unnecessarily sacrificed prior elements of Board election procedure that better assured a final electoral result that is fundamentally fairer and still provides for the conduct of an election within a reasonable period of time from the filing of a petition.’’ 84 FR at 69577. In contrast, the changes that the final rule here makes in the blocking-charge policy do address unnecessary delay in the conduct of an election without sacrificing safeguards against unfair labor practice charges that might affect the election results. Further, in at least some cases, the delay involved in blocking an election has been months or years, far exceeding the additional days or weeks added to the election processing timeframe by the 2019 Election Rule. Some commenters assert that eliminating the policy of blocking elections based on pending charges may force the Board to expend additional resources in holding second elections that would not be necessary if initial elections are delayed. We do not consider this to be a waste by any means, and any consequential costs are worth the benefits secured. Preliminarily, it is clearly not the case that unfair labor practices alleged in a charge, even if meritorious, will invariably result in a vote against union representation. If the union prevails despite those unfair labor practices, there will be no second election. In any event, one of the principal duties of the Board is to resolve questions of representation by holding elections, and that duty is not discharged where the Board does not process a representation petition, especially where there is no legitimate basis for delaying an election.98 As the General Counsel has stated, ‘‘any burden on the Regions in conducting elections where the ballots may never be counted is outweighed by the critical benefit of ensuring employee free choice.’’99 98 Comment 99 Comment E:\FR\FM\01APR2.SGM of CDW. of GC Robb. 01APR2 Federal Register / Vol. 85, No. 63 / Wednesday, April 1, 2020 / Rules and Regulations For the foregoing reasons (and those discussed in the NPRM), we continue to believe that revising the blocking-charge policy to end the practice of delaying an election represents a more appropriately balanced approach to the issue of how to treat election petitions when relevant unfair labor practice charges are pending. It ensures that employees are able to express their preference for or against union representation in a timely held Board election, while maintaining effective means for addressing election interference. This is an outcome that we believe we can, and should, guarantee for every employee covered under the Act, while at the same time imposing minimal burden on the parties to an election and, just as importantly, the employees who vote in those elections. jbell on DSKJLSW7X2PROD with RULES2 2. Comments Regarding Other Alternatives Several commenters contend that there are adequate existing alternatives that make it unnecessary to abolish the blocking-charge policy. Some commenters observe that regional directors already have discretion to decide to process a petition despite a pending unfair labor practice charge.100 One commenter states that variation in the exercise of such discretion is to be expected as a consequence of what the commenter characterizes as a law-enforcement context of a prosecutorial determination of merit in the blocking charge.101 Commenters suggest that, as an alternative to proceeding to an election but impounding the ballots (or delaying the certification), the Board could grant greater discretion to regional directors.102 However, one commenter contends that currently, some regional directors reflexively block elections in cases where unfair labor practice charges are filed, even when the underlying offer of proof is weak and the charges are patently frivolous, minor, and/or false.103 And one commenter asserts that regional directors act arbitrarily in determining which types of charges should block an election by, for instance, largely ignoring the electionrelated effects of unfair labor practices committed by unions.104 Further, one commenter notes the substantial inconsistency that already exists across regions, and argues that the opportunity to vote in a timely-conducted election of SEIU; Professor Kulwiec. of IUOE. 102 See, e.g., Comments of IUOE; CWA. 103 Comment of NRWLDF. 104 Id. should not depend on employees’ geographic locations.105 As reflected in these comments, and as discussed in the NPRM, concerns have been raised about regional directors not applying the current blocking-charge policy consistently, thereby creating uncertainty and confusion about when, if ever, parties can expect an election to occur. See Zev J. Eigen & Sandro Garofalo, Less Is More: A Case for Structural Reform of the National Labor Relations Board, 98 Minn. L. Rev. 1879 at 1896–1897 (‘‘Regional directors have wide discretion in allowing elections to be blocked, and this sometimes results in the delay of an election for months and in some cases for years—especially when the union resorts to the tactic of filing consecutive unmeritorious charges over a long period of time. This is contrary to the central policy of the Act, which is to allow employees to freely choose their bargaining representative, or to choose not to be represented at all.’’). We do not believe that granting broader discretion to regional directors is a preferable alternative to eliminating altogether the policy of blocking an election based on an unfair labor practice charge. As one commenter notes, the Board is entrusted with setting national labor policy, and it would better fulfill that duty by creating a uniform election schedule, notwithstanding any pending unfair labor practice charges, than by giving regional directors even more discretion to decide whether employees should have a timely opportunity to vote in an election.106 As another commenter states, the more that employees are left in the dark as to when—much less whether—they will be able to vote, the further deprived they are of laboratory conditions.107 It is because of this need for uniformity that we also decline to create an exception, as proposed by one of the commenters, to continue to allow an election to be blocked when it is the petitioner who files the unfair labor practice charge.108 Doing so would preserve the opportunity for a petitioner to manipulate the timing of the election for maximum advantage. If a petition is filed presenting a question of representation, we believe the election should proceed regardless of who files the petition, although certification may 18379 be delayed while the unfair labor practice charge is resolved. Other commenters suggest that the expedited evidentiary requirement for blocking charge requests adopted in the 2015 Election Rule is a sufficient alternative to the proposed change. In this connection, some commenters claim that the Board has not fully studied the effects of that Rule, or that we should maintain the status quo for an indefinite length of time because of that Rule.109 We reject those claims. As one commenter suggests, at least some meritless unfair labor practice charges are still being filed, notwithstanding the 2015 Election Rule’s requirement of a submission of a perfunctory offer of proof.110 In any event, as previously discussed, the offer-of-proof requirement is likely to result in prompt dismissal or withdrawal of only the most obviously meritless charges. Beyond that, as also discussed, we find that the better policy protective of employee free choice is to eliminate blocking elections based on any pending unfair labor practice charges, even those that may ultimately be found to have merit. However, the final rule preserves the evidentiary requirements created by the 2015 Election Rule. Finally, to the extent that the Board’s recent decision in Johnson Controls, Inc., 368 NLRB No. 20 (2019), addresses our concern about the post-contract presumption of union majority support in the face of contrary evidence, as one commenter suggests,111 that decision is not a sufficient alternative to ending the blocking-charge policy. Even under Johnson Controls, anticipatory withdrawals based upon evidence of employee disaffection could still be as ineffective as the RM-petition ‘‘safe harbor’’ because a union could still file a charge blocking employees from getting to vote in an election, while the employer may feel compelled to retain the employees’ existing terms and conditions of employment out of concern that it may otherwise be engaging in objectionable conduct. 3. Modifications to the Proposed Rule and Arguments Regarding Settlements Some commenters argue that a voteand-impound procedure for all unfair labor practice charges, as proposed in the NPRM, would not provide the expected salutary effect that would come from a charging party—fully aware of the results of the election— knowing that it was acting either with 100 Comments 101 Comment VerDate Sep<11>2014 19:25 Mar 31, 2020 Jkt 250001 105 Comment of CDW. of the Chamber. 107 Comment of COLLE. 108 Comment of AFL–CIO. 106 Comment PO 00000 Frm 00015 Fmt 4701 Sfmt 4700 109 Comments of SEIU; Professor Kulwiec; AFL– CIO; CWA; AFSCME; IBEW. 110 Comment of CDW. 111 Comment of UFCW. E:\FR\FM\01APR2.SGM 01APR2 18380 Federal Register / Vol. 85, No. 63 / Wednesday, April 1, 2020 / Rules and Regulations jbell on DSKJLSW7X2PROD with RULES2 the support of or in the teeth of employees’ wishes.112 In particular, as one commenter notes, impoundment of ballots does not fully ameliorate the problems with the current blockingcharge policy because impoundment fails to decrease a union’s incentive to delay its decertification by filing meritless blocking charges; makes it more difficult for parties to settle blocking charges, as they would not know the results of the election during their settlement discussions; and further frustrates and confuses employees waiting, possibly for an extended postelection period, to learn the results of the election.113 After considering those arguments, we agree with commenters who state that it would be preferable for ballots to be counted immediately after the conclusion of the election, but holding the certification of the election results in abeyance pending the resolution of the unfair labor practice charge.114 Accordingly, the final rule makes that change with regard to most categories of unfair labor practice charges. At the same time, however, some types of unfair labor practice charges speak to the very legitimacy of the election process in such a way that warrants different treatment— specifically, those that allege violations of Section 8(a)(1) and 8(a)(2) or Section 8(b)(1)(A) of the Act and that challenge the circumstances surrounding the petition or the showing of interest submitted in support of the petition, and those that allege that an employer has dominated a union in violation of Section 8(a)(2) and that seek to disestablish a bargaining relationship. We believe that in cases involving those types of charges, it is more appropriate to impound the ballots than to promptly count them. Nevertheless, in order to avoid a situation where employees are unaware of the election results indefinitely, we believe it is appropriate to set an outer limit on how long ballots will be impounded. Accordingly, the final rule provides that the impoundment will last for only up to 60 days from the conclusion of the election if the charge has not been withdrawn or dismissed prior to the conclusion of the election, in order to give the General Counsel time to make a merit determination regarding the unfair labor practice charge.115 We believe that this 112 Comments of ABC; NRWLDF. of NRWLDF. 114 Comment of the Chamber. 115 To the extent that some commenters suggest that we could impose an outer limit on the duration of the General Counsel’s unfair labor practice investigation, we reject those suggestions as beyond our authority. The Board retains the authority to 113 Comment VerDate Sep<11>2014 19:25 Mar 31, 2020 Jkt 250001 60-day period will reasonably provide sufficient time for the General Counsel to investigate the charge and assess its merits without substantially affecting employees’ interests in knowing the electoral outcome.116 Additionally, the final rule specifies that, if a complaint issues with respect to the charge during the 60-day period, then the ballots shall continue to be impounded until there is a final determination regarding the charge and its effects, if any, on the election petition. If the charge is found to have merit in a final Board determination, we will set aside the election and either order a second election or issue an affirmative bargaining order, depending on the nature of the violation or violations found to have been committed. If the charge is withdrawn or dismissed at any time during the 60-day impoundment period, or if the 60-day period ends without a complaint issuing, then the ballots shall be promptly opened and counted. The final rule also specifies that, if unfair labor practice charges are filed serially, the 60-day period will not be extended. In our view, these two different procedures—a vote-and-count procedure for most categories of charges, and a vote-and-impound procedure for some limited categories of charges—best accommodate the various concerns that the commenters have raised while protecting the rights that we are obligated to safeguard. For that reason, we reject the assertion of some commenters that we have not attempted to balance, or even quantify, the burden and the benefit in adopting these revised procedures.117 Finally, we note that we received some comments regarding the proposed rule’s effects on settlements.118 However, the NPRM expressly stated determine the timing of a representation election and disclosure of the results of that election during the investigation of an unfair labor practice charge, but the General Counsel has independent authority under Sec. 3(d) of the Act to investigate the charge, without any limitation on the length of that investigation. See Comments of AFL–CIO; CWA. 116 We note that the NLRB’s 2019 Performance and Accountability Report states that in fiscal year 2019, the Agency’s regional offices processed unfair labor practice charges from filing to disposition in a median of 74 days. NLRB, FY 2019 Performance and Accountability Report 7, https://www.nlrb.gov/ sites/default/files/attachments/basic-page/node1674/nlrb-par-2019-design-508.pdf (last visited Mar. 23, 2020). Moreover, we would expect that investigations of charges triggering the vote-andimpound procedure could be given priority and conducted expeditiously. These considerations further support our conclusion that a 60-day limit on the duration of ballot impoundment represents a reasonable limitation on employees’ interest in learning the outcome of the vote. 117 Comments of AFL–CIO; UFCW. 118 Comments of SEIU; AFL–CIO; Local 32BJ. PO 00000 Frm 00016 Fmt 4701 Sfmt 4700 that the Board does not intend this rulemaking to address other election-bar policies, including the settlement bar. 84 FR at 39931 fn. 3. Thus, the rule, by its terms, applies to requests to block an election with an unfair labor practice charge, and it does not apply where a party seeks to interpose a settlement agreement as a bar to an election. Further, the types of settlements, and the circumstances in which they can be reached, are myriad. For all of these reasons, this rule does not address the effect of settlements or disturb the Board’s case law addressing the effects of various types of settlements. Any possible changes in the law on those issues are left for other proceedings. Cf. Mobil Oil Expl. & Producing Se. Inc., 498 U.S. at 231 (‘‘[A]n agency need not solve every problem before it in the same proceeding.’’); Advocates for Highway & Auto Safety, 429 F.3d at 1147 (‘‘Agencies surely may, in appropriate circumstances, address problems incrementally.’’). We note that, under existing procedures that this rule does not disturb, a party that files a request for review of a decision and direction of election prior to the election may request extraordinary relief in the form of, among other things, impoundment of some or all of the ballots. See 29 CFR 102.67(j). Thus, there is an existing mechanism that allows a request to keep the ballots impounded in appropriate circumstances. F. Final-Rule Amendment Regarding Voluntary-Recognition Election Bar The Board also received numerous comments on the proposed amendment concerning the current immediate voluntary-recognition bar. We have carefully reviewed and considered these comments, as discussed below. 1. Comments About Voluntary Recognition Relative to Board Elections Two commenters state that voluntary recognition is ‘‘favored,’’ quoting NLRB v. Broadmoor Lumber Co., 578 F.2d 238, 241 (9th Cir. 1978).119 In addition, one commenter asserts that the Act does not create separate bargaining obligations or ‘‘different systems of private ordering’’ for unions based on whether they achieved their status through voluntary recognition or certification.120 Further, several commenters note that voluntary recognition predated the Act, and that the Act created the election process only as a means of resolving questions of 119 Comments 120 Comment E:\FR\FM\01APR2.SGM of Local 32BJ; AFSCME. of UFCW. 01APR2 Federal Register / Vol. 85, No. 63 / Wednesday, April 1, 2020 / Rules and Regulations jbell on DSKJLSW7X2PROD with RULES2 representation when the parties could not resolve them privately.121 It is well established that voluntary recognition and voluntary-recognition agreements are lawful. NLRB v. Gissel Packing Co., 395 U.S. at 595–600; United Mine Workers of America v. Arkansas Oak Flooring Co., 351 U.S. at 72 fn. 8. However, as several commenters note,122 it also is well established that Board elections are the Act’s preferred method for resolving questions of representation. As an initial matter, the Act itself implicitly supports this principle. As some commenters note, unlike the election bar, the voluntary-recognition bar is not in the Act; it is a Boardcreated doctrine.123 Further, the 1947 Taft-Hartley amendments to Section 9 of the Act limited Board certification of exclusive collective-bargaining representatives—and the benefits that result from certification 124—to unions that prevail in a Board election. While the Act’s text does not state an explicit preference for Board elections, the election-year bar and the greater statutory protections accorded to a Board-certified bargaining representative implicitly reflect congressional intent to encourage the use of Board elections as the preferred means for resolving questions concerning representation. Additionally, both the Board and the courts have long recognized that secretballot elections are better than voluntary recognition at protecting employees’ Section 7 freedom to choose, or not choose, a bargaining representative. See, e.g., Linden Lumber Div. v. NLRB, 419 U.S. 301, 304 (1974); NLRB v. Gissel Packing Co., 395 U.S. at 602; Transp. Mgmt. Servs. v. NLRB, 275 F.3d 112, 114 (D.C. Cir. 2002); NLRB v. Cayuga Crushed Stone, Inc., 474 F.2d 1380, 1383 (2d Cir. 1973); Levitz Furniture Co. of the Pacific, 333 NLRB at 727; Underground Service Alert, 315 NLRB 958, 960 (1994). As the United States Supreme Court has stated, ‘‘secret elections are generally the most satisfactory—indeed the preferred— method of ascertaining whether a union has majority support.’’ NLRB v. Gissel 121 Comments of IUOE; AFL–CIO; EPI; IBEW; St. Louis-Kansas City Carpenters Regional Council. 122 Comments of GC Robb; CDW; Representatives Foxx and Walberg; NRWLDF; CNLP. 123 Comments of NRWLDF; COLLE; CDW. 124 Those benefits include a 12-month bar to election petitions under Sec. 9(c)(3) as well as to withdrawal of recognition; protection against recognitional picketing by rival unions under Sec. 8(b)(4)(C); the right to engage in certain secondary and recognitional activity under Sec. 8(b)(4)(B) and 7(A); and, in certain circumstances, a defense to allegations of unlawful jurisdictional picketing under Sec. 8(b)(4)(D). VerDate Sep<11>2014 19:25 Mar 31, 2020 Jkt 250001 Packing Co., 395 U.S. at 602. Although voluntary recognition is a valid method of obtaining recognition, authorization cards used in a card-check recognition process are ‘‘admittedly inferior to the election process.’’ Id. at 603. As several commenters note, the Board takes prophylactic measures to ensure a free and fair ballot in elections that it conducts (e.g., requiring posting election notices at least 3 days beforehand).125 Further, as some commenters note, because the Board does not supervise voluntary recognitions, it generally cannot know whether an employer-recognized union has the uncoerced support of a majority of employees.126 Unlike votes cast in private during Board-conducted secretballot elections, card signings are public actions, susceptible to group pressure exerted at the moment of choice. Even if such pressure is not unlawfully coercive, it warrants consideration in determining the reliability of an employee’s choice. As several commenters note, employees may sign cards because they are susceptible to peer pressure or do not want to appear nonconformist or antagonistic.127 See, e.g., NLRB v. Village IX, Inc., 723 F.2d 1360, 1371 (7th Cir. 1983) (‘‘Workers sometimes sign union authorization cards not because they intend to vote for the union in the election but to avoid offending the person who asks them to sign, often a fellow worker, or simply to get the person off their back, since signing commits the worker to nothing (except that if enough workers sign, the employer may decide to recognize the union without an election).’’). Of course, as several commenters also note, signatures on authorization cards may be the result not merely of peer pressure, but of threats, intimidation, coercion, harassment, or other conduct that falls far short of the ‘‘laboratory conditions’’ the Board seeks to ensure during elections.128 Absent an electoral option, the only way for an employee to address this conduct would be to file an unfair labor practice charge, with the prospect of an extended investigation and litigation period to follow, during which the challenged bargaining relationship would continue. Further, as some commenters note, employees often sign cards due to misunderstandings, misrepresentations, or lack of information about the 125 E.g., Comment of COLLE. Comments of NRWLDF; CDW. 127 Comments of COLLE; CDW; GC Robb; the Chamber. 128 Comments of NRWLDF; GC Robb; Representatives Foxx and Walberg; the Chamber. See also Reply Comment of CNLP. 126 E.g., PO 00000 Frm 00017 Fmt 4701 Sfmt 4700 18381 consequences of unionization.129 Moreover, as one commenter notes, a card check often is accompanied by formal or informal employer neutrality, which may effectively deprive employees of any exposure to information or argument that might cause them to decline representation.130 Some commenters claim that there is no evidence to support these contentions.131 Relatedly, one commenter claims that workers do not obtain more accurate information during Board election campaigns than they do during voluntary-recognition efforts.132 However, the ‘‘uninhibited, robust, and wide-open debate’’ characteristic of a Board-conducted election better fulfills the national labor policy that Congress has established. See Chamber of Commerce of U.S. v. Brown, 554 U.S. 60, 68 (2008) (NLRA preempted state law restricting use of state funds to assist, promote, or deter union organizing). Another advantage of a Board election is that it presents a clear picture of employee voter preference at a single moment. As some commenters note,133 elections provide a ‘‘snapshot in time’’ while card signings may take place over a period of time, during which employee sentiment can change. See, e.g., Johnson Controls, Inc., 368 NLRB No. 20 (six employees signed union authorization cards shortly after signing decertification petition); Alliant Food Service, 335 NLRB 695 (2001) (16 employees who signed cards for 1 union subsequently signed cards for another union). According to one commenter, the fact that an election takes place at a single moment disenfranchises employees who are absent on the day of an election.134 But, as the General Counsel notes, some employees may be completely unaware of an organizing effort prior to a voluntary recognition because a union needs signatures from only a majority of the unit.135 It is not unreasonable to conclude that if a union knows or suspects which employees may be inclined to support it, the union may target those employees to sign cards while avoiding employees perceived to be less sympathetic to the union’s efforts. In contrast, all unit employees receive advance notice of the opportunity to vote in a Boardconducted representation election. In 129 Comments of NRWLDF; the Chamber. of CDW. 131 Comments of IUOE; Local 32BJ. 132 Comment of Local 32BJ. 133 Comments of CDW; GC Robb. 134 Comment of Local 32BJ. 135 Comment of GC Robb. 130 Comment E:\FR\FM\01APR2.SGM 01APR2 18382 Federal Register / Vol. 85, No. 63 / Wednesday, April 1, 2020 / Rules and Regulations agreement with the General Counsel, we believe that employees who would otherwise be left in the dark regarding a voluntary-recognition drive should have the opportunity to campaign and vote against representation or in favor of a different union 136—even if that means that employees who are absent on the day of the election (for which they receive advance notice) are unable to vote.137 Some commenters contend that laboratory conditions are sometimes destroyed during election campaigns 138 and that pressure from employers or other employees can occur during such campaigns.139 We agree. However, the Board’s election process provides for post-election review of unlawful and other objectionable conduct, and such review may result in the invalidation of the election results and the conduct of a rerun election. There are no guarantees of comparable safeguards in the voluntary-recognition process. This is a meaningful distinction that supports previous court and Board decisions that Board-conducted elections are preferable to voluntary recognition. One commenter states that the proposed changes to the blocking-charge policy are inconsistent with the rationale stated here—i.e., that conditions attendant to Board elections make such elections preferable to voluntary recognition.140 We disagree. As previously stated, our revision of the blocking-charge policy is intended to protect the right of employees to a timely election. The outcome of that election may still be invalidated by the ultimate resolution of the merits of the blocking charge and its effects on employee free choice, but the timely conduct of the election is entirely consistent with the concept that a secret-ballot Board election is the preferred method for determining whether a union has majority support. Further, nothing in our final-rule jbell on DSKJLSW7X2PROD with RULES2 136 Id. 137 Moreover, as noted in NLRB Casehandling Manual (Part 2) Representation Proceedings Sec. 11302 (Jan. 2017), election-scheduling details ‘‘are ordinarily based upon the parties’ voluntary meeting of the minds (with the regional director’s approval), as reflected in an election agreement.’’ In the event the regional director has to determine this matter, the manual provides that ‘‘[w]here there is a choice, the regional director should avoid scheduling the election on dates on which all or part of the facility will be closed, on which past experience indicates that the rate of absenteeism will be high, or on days that many persons will be away from the facility on company business or on vacation.’’ In either event, the procedures aim to minimize as much as possible the disenfranchisement of employees because they are absent on election day. 138 Reply Comment of IBEW. 139 Comments of Local 32BJ; UA. 140 Comment of SEIU. VerDate Sep<11>2014 19:25 Mar 31, 2020 Jkt 250001 amendments precludes the filing of a blocking charge with respect to an election petition filed after voluntary recognition. The same ‘‘laboratory conditions’’ standard will apply to the conduct of that election, and the same consequences will ensue if the blocking charge is ultimately found to have merit. Relatedly, some commenters argue that Johnson Controls, supra, undercuts the rationale that a Board election is the preferred means of determining majority support, insofar as ‘‘the non-electoral showing of lack of majority support there is no more reliable than the nonelectoral showing of majority support addressed in’’ the rule here.141 We disagree. In Johnson Controls, the Board held that proof of an incumbent union’s actual loss of majority support, if received by an employer within 90 days prior to contract expiration, conclusively rebuts the union’s presumptive continuing majority status when the contract expires. 368 NLRB No. 20, slip op. at 2. However, the Board also held that, in those circumstances, the union may attempt to reestablish that status by filing a Board election petition within 45 days from the date the employer gives notice of an anticipatory withdrawal of recognition. Id. Consequently, Johnson Controls established a process parallel to the one we adopt here in the final-rule amendment. That is, after a bargaining relationship has been established or repudiated on the basis of a non-Board showing of majority-employee support for this action, employees will still have an immediate limited opportunity for a referendum on that action in a Boardsupervised private-ballot election. For that matter, our final amendment of the voluntary-recognition bar provides greater protection to a continuing bargaining relationship than Johnson Controls does for majority-based withdrawal of recognition. If no petition is filed within the post-recognition period permitted under the rule, the recognition and contract-bar rules will take effect, potentially postponing any electoral challenge for years. In contrast, even if no petition is filed during the Johnson Controls open period following anticipatory repudiation, a petition can be filed at any time after expiration of the parties’ final contract. One commenter contends that the purported preference for Board elections conflicts with the Board’s December 14, 2017 Request for Information (RFI) on the 2015 Election Rule, 82 FR 58783, inasmuch as the RFI was allegedly an attempt to weaken the 2015 Election Rule, which made it possible for 141 Comments PO 00000 Frm 00018 of SEIU; NNU. Fmt 4701 Sfmt 4700 employees to vote in a ‘‘timelier manner.142 We disagree with this comment. Nothing in the RFI, which had no effect on the validity of procedures established by the 2015 Election Rule, or in the amendments to those procedures set forth in the Board’s 2019 Election Rule, which were founded on independent reasons stated therein, undercut the statutory, judicial, and agency preference for Board elections. Additionally, some commenters contend that the rule discriminates against voluntary recognition, contrary to various provisions of Section 1 of the Act (‘‘encouraging practices fundamental to the friendly adjustment of industrial disputes’’; protecting ‘‘exercise by workers of full freedom of association, self-organization, and designation of representatives of their own choosing, for the purpose of negotiating the terms and conditions of their employment or other mutual aid or protection’’; preventing ‘‘industrial strife or unrest’’; and ‘‘encouraging the practice and procedure of collective bargaining’’).143 One commenter also asserts that the rule is contrary to Section 8(a)(5) and Section 9(a) of the Act insofar as it ‘‘would place bargaining relationships formed by voluntary recognition at a disadvantage from their inception.’’ 144 On the contrary, the final-rule amendment here does not discriminate against or in any way restrict the lawful voluntary establishment of majoritysupported bargaining relationships, nor does it limit the immediate statutory rights and responsibilities that ensue upon commencement of those relationships. The amendment simply provides for a limited post-recognition opportunity for employees to exercise their statutory right of free choice through the preferred means of a Board election as to whether that relationship should continue without the possibility of further challenge for a substantial period of time. In this regard, several commenters correctly note that, currently, the immediate voluntaryrecognition bar and the contract bar, together, can block employees’ right to an election for 4 years (assuming a 3year contract)—or even longer if the parties do not begin bargaining right away, as the voluntary-recognition bar period begins not at recognition, but when the parties start bargaining.145 Given this fact, we believe that the immediate post-recognition imposition 142 Comment of EPI. of AFL–CIO; EPI; UFCW. 144 Comment of UFCW. 145 Comments of NRWLDF; CDW; GC Robb. 143 Comments E:\FR\FM\01APR2.SGM 01APR2 Federal Register / Vol. 85, No. 63 / Wednesday, April 1, 2020 / Rules and Regulations jbell on DSKJLSW7X2PROD with RULES2 of an election bar does not sufficiently protect affected employees’ statutory right to exercise their choice on collective-bargaining representation through the preferred method of a Board-conducted election. This consideration provides considerable support for the proposed rule. Further, several commenters contend that voluntary recognition is arguably more democratic than a Board election because it requires a majority of all eligible employees, not just a majority of those who vote in an election.146 We do not dispute that voluntary recognition must always be based on an absolute majority of bargaining-unit employees, while the result of a Board election will be based on the choice of a majority of unit employees who actually vote. We disagree, however, that this makes voluntary recognition more democratic than a Board election. The conditions under which a choice is expressed, and the safeguards surrounding it, are as much as part of the democratic process as the number of those who register a choice. A secret-ballot election, overseen by a neutral federal agency with the power to prevent or remedy any objectionable conduct affecting the election, provides a far greater assurance of a truly democratic outcome than does the voluntary-recognition process. 2. Comments Alleging That the Rule is Arbitrary Some commenters assert that requiring notices only in the context of voluntary recognition is arbitrary: Notices are not required when an employer withdraws recognition from a certified union, or when a one-year election bar expires; non-union employers are not required to post notices to employees about how to obtain Board recognition of a union; and in no other context does the Board require that employees be given notice of their right to change their minds about a recent exercise of statutory rights.147 It may or may not be true that notices should be required in some of these other contexts. But the rule is not arbitrary merely because it does not address those other contexts. Cf. Mobil Oil Expl. & Producing Se. Inc., 498 U.S. at 231 (‘‘[A]n agency need not solve every problem before it in the same proceeding.’’); Advocates for Highway & Auto Safety, 429 F.3d at 1147 (‘‘Agencies surely may, in appropriate circumstances, address problems 146 Comments of AFT; SEIU; UFCW; St. LouisKansas City Carpenters Regional Council; Professor Kulwiec. 147 Comments of UA; IBEW; AFSCME; SEIU; AFL–CIO; NNU. VerDate Sep<11>2014 19:25 Mar 31, 2020 Jkt 250001 incrementally.’’). And we decline to decide, in the context of this rulemaking, that postings should be required in contexts outside the scope of this rule. Accordingly, we reject these comments. Relatedly, one commenter states that there is no window period for reconsideration and an election petition when an employer lawfully withdraws recognition based on a showing of actual loss of majority support, or after a union loses an election and wants a revote just in case employees have changed their minds.148 We disagree. As stated above, when an employer lawfully withdraws recognition based on a petition or cards showing an actual lack of majority support, employees do have an opportunity for reconsideration and an election: They can immediately file an election petition if they can garner the supporting 30 percent showing of interest for one. And after a union loses an election, the Act itself bars another election for 1 year precisely because employees have already voted in a Board election. This does not mean that the Board should decline to allow employees, in a voluntary-recognition situation where employees have not voted in a Board election, to have a limited period of time to petition for an election where they can express their views by secret ballot. 3. Comments Regarding Post-Dana Experience Several commenters assert that data from the post-Dana period do not support the proposed rule because they show that workers requested an election in only a small percentage of cases, and workers voted against the incumbent union in only a fraction of those cases.149 As discussed in Lamons Gasket, as of May 13, 2011, the Board had received 1,333 requests for Dana notices. 357 NLRB at 742. In those cases, 102 election petitions were subsequently filed, and 62 elections were held. Id. In 17 of those elections, the employees voted against continued representation by the voluntarily recognized union, including 2 instances in which a petitioning union was selected over the recognized union and 1 instance in which the petition was withdrawn after objections were filed. Id. Thus, only 7.65 percent of Dana notice requests resulted in election petitions, only 4.65 percent of Dana notices resulted in actual elections, and employees decertified the voluntarily 148 Comment of AFSCME. of Workers United; IUOE; AFL– CIO; NNU; EPI; UFCW; UA; IBEW; Local 32BJ; AFSCME; St. Louis-Kansas City Carpenters Regional Council. 149 Comments PO 00000 Frm 00019 Fmt 4701 Sfmt 4700 18383 recognized union in only 1.2 percent of the total cases in which Dana notices were requested. On the other hand, in the elections that were held under Dana, employees voted against continued representation by the voluntarily recognized union approximately 25 percent of the time. Id. at 751 (Member Hayes, dissenting). According to one commenter, this reversal rate shows that voluntary recognition is not a reliable indicator of majority-employee support.150 In our view, the fact that only a small percentage of all Dana notices resulted in ending continued representation by the voluntarily recognized union does not mean that the post-recognition open period procedure was unnecessary and should not be restored. The fact that in about 1 out of every 4 Dana elections a majority of employees voted to reject continued representation by a voluntarily recognized union is far from meaningless. Neither is the fact that Dana elections were held in only a small percentage of cases where the required notice of voluntary recognition and the right to petition for an election was given. In our view, Dana served its intended purpose of assuring employee free choice in all of those cases at the outset of a bargaining relationship based on voluntary recognition, rather than 1 to 4 years or more later. Some commenters speculate that we could expect to see the same percentage of reversed outcomes after Boardconducted elections if the statutory election bar did not exist to temporarily bar second elections,151 or that the reversal rate could represent something like ‘‘buyer’s remorse’’ rather than the unreliability of authorization cards.152 Even were there evidence to support such speculation, we nonetheless believe that giving employees an opportunity to exercise free choice in a Board-supervised election without having to wait years to do so is still solidly based on and justified by the policy grounds already stated. Further, as for the 1231 cases in which Dana notices were requested but no petitions were filed, we know nothing about the reasons for that outcome. Specifically, we know nothing about the reliability of the proof of majority support that underlay recognition in each of these cases, nor do we know why no petition was filed. What we do know is that the employers and unions who voluntarily entered into bargaining relationships during Dana’s effective period complied with the 150 Comment of NRWLDF. of Local 32BJ; AFL–CIO. 152 Comment of Local 32BJ. 151 Comments E:\FR\FM\01APR2.SGM 01APR2 18384 Federal Register / Vol. 85, No. 63 / Wednesday, April 1, 2020 / Rules and Regulations jbell on DSKJLSW7X2PROD with RULES2 notice requirement in impressive numbers and, as a consequence, we can be confident that affected employees were adequately informed of their opportunity to file for an election. In sum, Dana imposed no apparent material hardship and provided the intended benefits of notice and opportunity to exercise important statutory rights. One commenter asserts that between Fiscal Year 2012 and Fiscal Year 2019, unlawful-recognition charges made up only about 1.6 percent of total unfair labor practice charges, and the commenter claims that the percentage should have been higher if the Board’s animating concerns were founded.153 Relatedly, another commenter asserts that post–Lamons Gasket, only a small percentage of unlawful-recognition charges resulted in a Board order, and that, if the overruling of Dana had truly undermined free choice, there should have been an increase in such charges.154 However, the breakdown of unfair labor practice charges and the reasons for not issuing a Board order can reflect any number of factors, and they do not necessarily indicate that a majority of employees actually support voluntary recognition. These comments are founded on the mistaken premise that the Dana procedure and its proposed reinstatement in this rulemaking are primarily intended to address unlawful voluntary recognition. To the contrary, the provision for notice and limited opportunity to petition for a Board election are intended to protect the preferred electoral mechanism from immediate and prolonged foreclosure by any voluntary recognition, lawful or otherwise. Ensuring employee free choice is a central purpose of the Act, and that purpose is furthered by the Dana procedure regardless of whether employees ultimately choose to continue their existing representation. 4. Comments Predicting That the Rule Will Have Negative Effects Some commenters claim that the rule will discourage voluntary recognition.155 However, employers and unions agree to voluntary recognition for any number of reasons, economic and otherwise, that the rule will not affect. See James J. Brudney, Neutrality Agreements and Card Check Recognition: Prospects for Changing Paradigms, 90 Iowa L. Rev. 819, 832– 841 (2005) (setting forth various reasons for neutrality and card-check 153 Comment of UFCW. of SEIU. 155 Comments of LIUNA MAROC; Local 304; SEIU. 154 Comment VerDate Sep<11>2014 19:25 Mar 31, 2020 Jkt 250001 agreements). Further, there is no evidence that, under Dana, voluntary recognition was less frequent. In fact, as discussed above, only 7.65 percent of Dana notice requests resulted in election petitions—and approximately three-quarters of those resulted in a continuation of the bargaining relationship, with the additional benefits of Board certification. As one commenter notes,156 this includes a protected 1-year period for negotiation of a collective-bargaining agreement,157 as opposed to the reasonable period of time for bargaining after voluntary recognition, a period that could be as little as 6 months. Other commenters argue that the rule will discourage or delay collective bargaining. In this regard, one commenter asserts that the rule ‘‘invites’’ employees to file election petitions and that this will delay collective bargaining and representation.158 Other commenters assert that parties, especially smaller entities, will be less likely to waste limited resources engaging in bargaining that could be for naught.159 Further, according to several commenters, because a collective-bargaining agreement reached within 45 days would not bar a petition, parties will be more likely to delay bargaining, or at least ‘‘serious’’ bargaining—thereby undermining the policies behind both the voluntary-recognition bar (enabling parties to begin bargaining without interruption) and the contract bar (achieving a reasonable balance between industrial stability and employee choice of representative).160 Moreover, several commenters argue that the delay in full representation will frustrate the exercise of Section 7 rights and send employees a message of futility or cause them to be disillusioned with the union’s representation, particularly given that the delay would occur when employees have not yet realized the benefits of collective bargaining.161 As an initial matter, the final rule does not affect established precedent holding that an employer’s obligation to bargain with the union attaches immediately upon voluntary recognition. During the 45-day noticeposting period, the union can begin representing employees, processing 156 Comment of COLLE. Brooks v. NLRB, 348 U.S. 96 (1954). 158 Comment of IBEW. 159 Comments of IBEW; SEIU. 160 Comments of AFSCME; Local 32BJ; UWUA; Senator Murray; IUOE; AFL–CIO; UFCW. 161 Comments of IBEW; Local 32BJ; SEIU; Professor Kulwiec; AFL–CIO; NNU; UFCW; CWA; AFSCME; St. Louis-Kansas City Carpenters Regional Council. 157 See PO 00000 Frm 00020 Fmt 4701 Sfmt 4700 their grievances, and bargaining on their behalf for a first contract. Even if a decertification or rival union petition is filed during the 45-day window period, that will not require or permit the employer to withdraw from bargaining or to refrain from executing a contract with the incumbent union. See Dresser Industries, Inc., 264 NLRB 1088, 1089 (1982); RCA del Caribe, Inc., 262 NLRB 963, 965 (1982). If the union is decertified after a contract has been signed, the contract would lose effect. Wayne County Neighborhood Legal Services, 333 NLRB 146, 148 fn.10 (2001); RCA del Caribe, 262 NLRB at 966; Consolidated Fiberglass Products, 242 NLRB 10 (1979). On the other hand, as noted above, if the union prevails in a post-recognition election, it will have the benefit of an extended one-year period for contract negotiations, during which, absent unusual circumstances, its majority status cannot be challenged. We also do not agree that the rule ‘‘invites’’ employees to file petitions for elections. The rule does not encourage, much less guarantee, the filing of a petition. An employer and a union are both free during the window period to express their views about the perceived benefits of a collective-bargaining relationship. If an employer believes that voluntary recognition is advantageous, it would not necessarily decline to recognize a union simply because there is some risk that a petition will be filed. Similarly, if a union has obtained a solid card majority and has been voluntarily recognized on that basis, it should not be deterred from promptly engaging in meaningful bargaining simply because of the risk of losing that majority in an election. For that matter, in many voluntaryrecognition situations, recognition and the execution of a first collectivebargaining agreement occur simultaneously. Although some commenters cite anecdotal evidence that Dana procedures occasionally delayed bargaining,162 there is no evidence in the record for this rulemaking that Dana had any meaningful impact on the negotiation of bargaining agreements during the open period or on the rate at which agreements were reached after voluntary recognition. Some commenters claim that the existence of a pending election petition will cause unions to spend more time campaigning or working on electionrelated matters rather than doing substantive work on behalf of employees.163 This may be true in some 162 Comments 163 Comments E:\FR\FM\01APR2.SGM 01APR2 of AFL–CIO; Local 32BJ. of Local 32BJ; CWA. Federal Register / Vol. 85, No. 63 / Wednesday, April 1, 2020 / Rules and Regulations jbell on DSKJLSW7X2PROD with RULES2 situations. However, we believe that this is a reasonable trade-off for protecting employees’ ability to express their views in a secret-ballot election. Moreover, we fail to see the bargaining disadvantage to a recognized union that can solidify, and perhaps expand, its base of support during the post-recognition open period. One commenter notes that the rule does not contain any mechanism that requires employers to post the notice, raising the possibility that an employer will willfully fail to post the notice and that an agreement reached could later be upended.164 According to this commenter, this may cause employers, in negotiations, to leverage their compliance with the notice-posting requirement against the union in an attempt to extract more generous substantive contract terms.165 While this scenario is possible, we have no basis to believe that it will occur, or if it does, that it would not be subject to a unfair labor practice allegation. One commenter contends that the rule would interfere in collective bargaining in another way. Specifically, this commenter claims, management often asks unions to agree not to discuss the details of ongoing negotiations or share drafts of either party’s proposals with workers who are not involved in negotiations.166 According to this commenter, unions will therefore often face a dilemma if decertification efforts gain support based upon rumors about the negotiating process—specifically, should they allow the rumors to go unchallenged, or respond to them and risk compromising the negotiations? 167 Whatever the likelihood that this would occur, we do not see why a lawfully recognized union would be bound to comply with any nondisclosure request that would interfere with its obligations to represent the unit employees during a post-recognition election campaign. Several commenters argue that the rule will undercut industrial stability. For example, some commenters assert that the rule will disrupt longstanding and/or stable collective-bargaining relationships by encouraging election campaigns, which can involve heated rhetoric.168 Another commenter states that the rule will require unions to jump through procedural hoops before they can achieve industrial stability, ‘‘without basically any concomitant benefit to employees.’’ 169 First, the final rule here does not apply to longstanding 164 Comment of Senator Murray. 165 Id. 166 Comment of Local 32BJ. collective-bargaining relationships. At most, in the absence of compliance with notice requirements after initial voluntary recognition, it applies to a post-recognition period extending no longer than the first collectivebargaining agreement. Second, we think it is unlikely that parties who have voluntarily entered into a mutually advantageous collective-bargaining relationship will engage in heated rhetoric in an ensuing election campaign, but if that does happen it is part of the free exchange of views that the Act protects. Third, data from the post-Dana period indicates that recognized unions will not often have to jump through the procedural ‘‘hoop’’ of an election, and those that do will far more often emerge with a reaffirmation of their majority support and the greater protection of a Board certification. The benefit to employees, as frequently stated here, is the assurance of their statutory right of free choice by providing them the limited opportunity to test a recognized union’s majority support through the preferred means of a Board election. One commenter asserts that, when a company acquires another business, voluntary-recognition agreements help employers and workers by not creating extra concerns during this period of transition; in essence, these agreements help ensure workplace stability at a critical time.170 But, as discussed above, we do not believe that the rule will materially discourage voluntaryrecognition agreements. The final rule also does not disturb existing legal principles governing the obligations of a successor employer. In addition, one commenter contends that the rule will invite local managers to reverse a national decision to grant voluntary recognition by unlawfully assisting a Dana petition, and further contends that this did happen once.171 There is no basis in the record for finding that this would occur on more than rare occasions, let alone for believing that it would escape detection through the Board’s unfair labor practice processes if and when it does occur. It is always the case that bad actors may seek to subvert the Board’s representation procedures through unlawful or otherwise objectionable conduct. Remedies exist to address such misconduct, and the bad acts of a few are no reason not to make those procedures more widely available. One commenter claims that the concomitant change to the immediate contract-bar rule will disturb parties’ 167 Id. 168 Comments 170 Comment 169 Comment 171 Comment VerDate Sep<11>2014 of IBEW; AFSCME. of Plumbers and Pipe Fitters. 19:25 Mar 31, 2020 Jkt 250001 PO 00000 Frm 00021 of CWA. of Local 32BJ. Fmt 4701 Sfmt 4700 18385 settled understandings of their rights and invalidate the private bargaining process that the Act is intended to promote.172 We believe that the modification is a necessary part of the voluntary-recognition-bar modification, with both modifications striking a more appropriate balance between laborrelations stability and employee free choice. Further, the contract-bar modification should incentivize parties to post a notice in order to avoid having the results of their negotiations subsequently invalidated. 5. Comments Regarding Availability of Other Alternatives Several commenters argue that there are other alternatives and that their availability undercuts the need for the proposed rule, or that other alternatives are superior to the proposed rule. In particular, some commenters assert that employees may file unfair labor practice charges if they believe that voluntary recognition is not based on majority support or is based on coerced support, while non-petitioner employees may not file election-related challenges and objections to Board elections.173 Further, several commenters note that employees have 6 months to file unfair labor practice charges, while parties have only 7 days to file objections after an election.174 We do not believe that the availability of unfair labor practice proceedings to challenge the validity of voluntary recognition undercuts the rule. As one commenter notes, unfair labor practice proceedings generally take longer than representation proceedings,175 and the General Counsel has unlimited discretion to decline to issue a complaint—and can settle the matter with the parties, without Board or court review—thus making it possible that the Board would never adjudicate employees’ claims.176 In any event, the commenters’ entire premise is misguided. The Board’s unfair labor practice processes are not an alternative to the final-rule amendment. The former, as relevant here, provide a means to challenge the legal validity of a voluntary recognition. As previously indicated, the purpose of the final-rule amendment is not to provide a means to challenge the legal validity of voluntary recognition. It is to provide a limited window of time for a referendum on that recognition through the preferred 172 Comment of UFCW. of AFL–CIO; IBEW; Local 32BJ; SEIU; IUOE; St. Louis-Kansas City Carpenters Regional Council. 174 Comments of AFL–CIO; Local 32BJ; St. LouisKansas City Carpenters Regional Council. 175 Comment of CNLP. 176 Id. 173 Comments E:\FR\FM\01APR2.SGM 01APR2 jbell on DSKJLSW7X2PROD with RULES2 18386 Federal Register / Vol. 85, No. 63 / Wednesday, April 1, 2020 / Rules and Regulations means and with the numerous advantages of a Board-supervised private-ballot election. Thus, the existing availability of the unfair labor practice process is not a substitute for the rule. Further, one commenter asserts that the rule is overbroad because it encompasses voluntary recognition based on non-Board secret-ballot elections.177 According to that commenter, private agencies such as the American Arbitration Association can ensure the integrity of elections, and private election agreements often provide for post-election procedures that parallel the Board’s.178 Another commenter contends that for successful voluntary recognitions, employers and unions have agreed to a process and a set of rules, and have met the voluntaryrecognition requirements in a format that a third party or neutral can confirm and verify—and that it would be federal-government overreach for the Board to interfere with these arrangements.179 However, another commenter contends that arbitrators merely count cards against a list of employees and do not know how the cards were obtained.180 In any event, regardless of what agreements employers and unions reach on these types of matters, we believe that there is significant value in allowing employees an opportunity to petition for a Board-conducted election. If they do not choose that option or do not garner sufficient support for an election petition, then nothing in this rule would interfere with the parties’ alternative arrangements. Alternatively, if their petition does achieve the necessary support, the resulting Board election is at worst merely duplicative of the parties’ private arrangements, and it offers a prevailing union all the advantages of Board certification. Another commenter notes that employees have the option to petition for an election during an open period between contracts.181 However, as discussed previously, the recognition bar and the contract bar, together, can last up to 4 years—longer, if there is a gap between recognition and bargaining. In our view, that is an unacceptable burden on employees’ ability to file an election petition following voluntary recognition. One commenter notes that cards signed as a result of deliberate misrepresentations regarding the 177 Comment of AFL–CIO. 6. Comments Providing General Critiques of the Proposed Rule Some commenters assert that the proposed notice-posting policy is contrary to the Board’s role as a neutral.184 We disagree. The rule is merely an attempt to provide for greater protection of employee free choice in selection of a representative; it has no effect on what that choice will be. Moreover, as discussed further in Section III.F.7. below, we have modified the text of the proposed rule, to provide that the Dana notice will more neutrally reflect the different options that are available to employees. Another commenter contends that the rule presumes that freely entered, armslength contracts are innately suspect, contrary to longstanding jurisprudence.185 The rule does not rest on this presumption; it merely gives employees a chance, for a limited period, to file a petition for an election to confirm whether such contracts were validly entered. Additionally, several commenters assert that, because only 30 percent of 182 Comment 178 Id. of Local 32BJ. of AFL–CIO. 184 Comments of IBEW; Senator Murray; NNU; St. Louis-Kansas City Carpenters Regional Council. 185 Comment of Joel Dillard. 183 Comment 179 Comment of James T. Springfield. of NRWLDF. 181 Comment of IBEW. 180 Comment VerDate Sep<11>2014 purpose of the card are invalid for purposes of proving the union’s majority status.182 But the possibility of cards being invalidated would necessarily involve unfair labor practice litigation challenging majority status. This does not constitute a sufficient alternative to a secret-ballot election. Moreover, one commenter contends that the NPRM failed to explain why the benefits of certification are insufficient to satisfy the Board’s expressed preference for elections.183 This comment assumes that employees are aware of the electoral option and that their vote for union representation would confer certain additional benefits on the representative and the bargaining relationship thus established, but they nevertheless consent to the alternative establishment of a bargaining relationship based on voluntary recognition. We question whether employees are aware of the benefits of certification and have consciously elected to forego them in favor of the voluntary-recognition process. Even if this is so, it does not persuade us that this majority choice should immediately foreclose the possibility of a limited post-recognition opportunity for employees to test or confirm the recognized union’s majority status by the preferred means of a Board election. 19:25 Mar 31, 2020 Jkt 250001 PO 00000 Frm 00022 Fmt 4701 Sfmt 4700 employees are needed to support a showing of interest, the rule gives employers and a minority of employees the chance to marshal support for ousting the union.186 According to some commenters, the many (albeit ultimately unsuccessful) petitions filed under Dana show that even in cases where a majority of voting employees ultimately favor representation, an anti-union minority is encouraged to keep resisting the majority’s will.187 According to one commenter, just as the Act does not contemplate an election rerun absent objectionable conduct, it also does not contemplate a ‘‘do-over’’ organizing period simply because a minority of employees are unhappy.188 However, as discussed previously, under Dana the Board received only 102 election petitions relative to 1,333 requests for notices over a period of several years. We do not believe that this indicates that a minority of employees repeatedly resist the majority’s will by filing petitions. And in any event, we believe that it is important to give all employees an opportunity—a narrow and limited opportunity—to express their free choice by petitioning for an election. Further, some commenters contend that the rule will waste government and party resources by requiring unnecessary elections.189 As an initial matter, as noted previously, the data under Dana show that, over a period of several years, only 62 elections were held—not a tremendously high number. In any event, we do not consider the elections ‘‘unnecessary,’’ regardless of whether they confirm continued representation. We believe that securing employee free choice is worth the commitment of resources. And we note again that in approximately 25 percent of those elections, employees voted to oust the recognized union. One commenter contends that the NPRM failed to comply with the APA because it did not contain the text of the contemplated notice to employees—and that, without that text, it is impossible to provide meaningful comments.190 However, in the NPRM, the Board explicitly proposed ‘‘to reinstate the Dana notice.’’ 84 FR at 39938. The key contents of the Dana notice were well established in that decision,191 and 186 Comments of SEIU; EPI; IUOE; UFCW; AFSCME. 187 Comment of Local 32BJ. 188 Comment of IUOE. 189 Comments of AFSCME; NNU; UFCW; CWA. 190 Comment of IBEW. 191 Specifically, in Dana, the Board held that the notice should clearly state that (1) the employer (on a specified date) recognized the union as the employees’ exclusive bargaining representative E:\FR\FM\01APR2.SGM 01APR2 Federal Register / Vol. 85, No. 63 / Wednesday, April 1, 2020 / Rules and Regulations jbell on DSKJLSW7X2PROD with RULES2 there is no basis for finding that the commenter was precluded from providing meaningful comments merely because the NPRM did not quote the Dana notice in its entirety.192 In addition, one commenter argues that the Board has failed to consider alternatives like shortening the length of the recognition-bar period.193 However, we do not believe that this alternative would be sufficient to achieve the goals that we have discussed herein and in the NPRM. Further, it arguably would detract from the labor-relations stability that so many commenters discuss and that we seek to balance with employee free choice. Accordingly, we reject that proffered alternative. Further, one commenter contends that the NPRM leaves open the possibility of further changes in the law with respect to other discretionary election-bar policies; this highlights both the arbitrary character of the items chosen for resolution here and the Board’s failure to achieve its stated goal of ensuring predictability; and, by creating uncertainty about the status of these related doctrines, the Board undermines the bargaining process in other contexts.194 However, for the reasons stated in Sections III.A. and III.F.2. above, we are not required to make changes to all related doctrines in this current rulemaking. Further, all legal doctrines are subject to change, whether based on evidence indicating that a majority of employees in a described bargaining unit desire its representation; (2) all employees, including those who previously signed cards in support of the recognized union, have the Sec. 7 right to be represented by a union of their choice or by no union at all; (3) within 45 days from the date of the notice, a decertification petition supported by 30 percent or more of the unit employees may be filed with the NLRB for a secret-ballot election to determine whether or not the unit employees wish to be represented by the union, or 30 percent or more of the unit employees can support another union’s filing of a petition to represent them; (4) any properly supported petition filed within the 45day period will be processed according to the Board’s normal procedures; and (5) if no petition is filed within the 45 days from the date of this notice, then the recognized union’s status as the unit employees’ exclusive majority bargaining representative will not be subject to challenge for a reasonable period of time following the expiration of the 45-day window period, to permit the union and the employer an opportunity to negotiate a collective-bargaining agreement. 351 NLRB at 443. 192 We note that, as discussed further below— consistent with recommendations from two commenters—the final rule makes some modifications with respect to required elements in tbe new post-recognition notice that differ from the requirements for a Dana notice. There also is no basis for finding that commenters reasonably could not have known to submit comments regarding what the notices should, or should not, include. In fact, some commenters did exactly that, and we have responded positively to those comments, as discussed below. 193 Comment of UFCW. 194 Id. VerDate Sep<11>2014 19:25 Mar 31, 2020 Jkt 250001 through rulemaking or adjudication, so the mere mention of possible future changes does not create additional uncertainty that undermines the bargaining process. As the Board itself stated in defense of what it described as ‘‘targeted’’ amendments to representation procedures in the 2015 Election Rule: ‘‘Of course, an administrative agency, like a legislative body, is not required to address all procedural or substantive problems at the same time. It need not ‘choose between attacking every aspect of a problem or not attacking the problem at all.’ Dandridge v. Williams, 397 U.S. 471, 487 (1970). Rather, the Board ‘may select one phase of one field and apply a remedy there, neglecting the others.’ FCC v. Beach Commc’ns, 508 U.S. 307, 316 (1993) (quoting Williamson v. Lee Optical of Okla., Inc., 348 U.S. 483, 489 (1955)). ‘[T]he reform may take one step at a time.’ Id.’’ 79 FR at 74318 (footnote omitted). For the above reasons, we find that these comments do not support abandoning the proposed rule.195 7. Comments Suggesting Changes to the Proposed Rule The General Counsel recommends that we extend the notice period from 45 days to 1 year.196 Another commenter supports this recommendation, stating that it would better protect employee free choice because employees, especially those in larger units or units that span multiple locations, need more time to organize to collect a decertification petition; and individual employees often need longer because they do not have ready access to paid organizers or to counsel who can guide them through the Board’s election process and the legal rules for collecting petition signatures.197 In contrast, a different commenter opposes such an extension, claiming that it is draconian; would threaten lawful, voluntary, nascent collective-bargaining relationships by permitting either a minority of employees or a rival union to file a petition during that period; would not promote collective bargaining and industrial peace; would run contrary to congressional intent that 195 In its voluntary-recognition arguments, one commenter refers back to one of its blocking-charge arguments, specifically, that the rule would violate the First and Fourteenth Amendments to, and the Take Care Clause of, the U.S. Constitution, and that it also raises separation-of-powers concerns. See Comment of NNU (citing Thomas v. Collins, 323 U.S. 516). Once again, this commenter does not explain its argument, and the cited decision does not support the commenter’s claim. Thus, we reject this claim as unsupported. 196 Comment of GC Robb. 197 Reply Comment of NRWLDF. PO 00000 Frm 00023 Fmt 4701 Sfmt 4700 18387 elections be conducted only where employers refuse to voluntarily recognize the union; and would thwart the expressed desire of a majority of workers.198 Consistent with certain commenters’ comments, we believe that the 45-day notice period strikes a reasonable balance between employee free choice and other interests—such as laborrelations stability and preserving lawful, voluntary recognitions—and ensures that both employers and unions have the benefit of the recognition bar for a reasonable period of time following the close of the window period when no petition is filed.199 Additionally, a 45day period is consistent with the period established in Johnson Controls for union petitions following notice of anticipatory withdrawal of recognition. See 368 NLRB No. 20. Further, as one commenter states, because employers would be responsible for posting and maintaining the Board-provided notice ‘‘throughout this period,’’ extending the notice period to 1 year would make additional challenges to compliance more likely.200 Accordingly, we decline to adopt the recommended change. The General Counsel also recommends that, at the end of his proposed 1-year period of notice posting, the Board should have discretion to continue to dismiss petitions ‘‘based on the facts and circumstances of the case,’’ or to impose a recognition bar ‘‘if circumstances so warrant.’’ 201 Other commenters disagree with this recommendation.202 As one commenter notes, the General Counsel provides no insight into what ‘‘circumstances [would] warrant insulating the collective-bargaining relationship for a limited period of time.’’ 203 We agree. In addition to the fact that we have rejected the proposal to extend the posting period to 1 year, we also do not believe that there is sufficient clarity as to how this proposed change would apply. Accordingly, we decline to adopt this suggested alternative. Additionally, the General Counsel recommends that we modify the proposed amendment so that agreements entered into after the parties’ first collective-bargaining agreement would enjoy bar status, regardless of whether the suggested 1198 Reply Comment of IBEW. of COLLE; the Chamber; CDW. 200 Reply Comment of AFL–CIO. 201 Comment of GC Robb. 202 Reply Comment of NRWLDF; Reply Comment of AFL–CIO. 203 Reply Comment of AFL–CIO. 199 Comments E:\FR\FM\01APR2.SGM 01APR2 jbell on DSKJLSW7X2PROD with RULES2 18388 Federal Register / Vol. 85, No. 63 / Wednesday, April 1, 2020 / Rules and Regulations year notice was posted.204 We agree. Even if there is no election bar for the first contract executed in the absence of compliance with the notice requirements of the amendment, we do not see the need to continue an unrestricted open period for filing petitions during the term of any successor agreement. In this connection, we note that current contract-bar rules created in adjudication permit the filing of petitions during established periods prior to the end of any contract with a term of 3 years or less. See, e.g., Johnson Controls, Inc., 368 NLRB No. 20, slip op. at 8 fn. 45 (discussing open periods for filing petitions in healthcare and nonhealthcare industries). In addition, there is no election bar after the third year of a contract with a longer effective term, nor is there any bar following contract expiration and prior to the effective date of a successor agreement. Under these circumstances, we believe that extant open-period rules provide a sufficient opportunity for employees and rival unions to file petitions and, thus, that it is unnecessary to require a notice posting and another open period upon execution of any successor collective-bargaining agreement. Accordingly, we clarify the rule to specify that a voluntary recognition entered into on or after the effective date of this rule, and ‘‘the first’’ collectivebargaining agreement entered into on or after the date of such voluntary recognition, will not bar the processing of an election petition if the requirements of the rule are not met. The General Counsel also recommends that the final rule specify the content of the notice and that the text of the notice should include several items. First, the General Counsel asserts that the rule should include all of the applicable items from the Dana notice. Second, the General Counsel contends that the rule should include information regarding how the contract bar operates during and after the window period and, in particular, should notify employees that they may file a petition within the window period even if the employer and union have already reached a collective-bargaining agreement, and that if they do not challenge the union’s status by filing a petition and the parties subsequently reach a collective-bargaining agreement, an election cannot be held for the duration of the collective-bargaining agreement, up to 3 years. Third, the General Counsel argues that the notice should include a more balanced description of employee rights and an affirmation of the Board’s neutrality, as the Dana notice has been criticized as being too one-sided in its description of employee rights, and therefore susceptible to the impression that the Board is urging employees to reconsider their selection of the new union. To give a more complete explanation of employee rights and to reinforce the Board’s neutrality, the General Counsel suggests that the notice should be updated to include the following language: Federal law gives employees the right to form, join, or assist a union and to choose not to engage in these protected activities. An employer may lawfully recognize a union based on evidence indicating that a majority of employees in an appropriate bargaining unit desire its representation. Once an employer recognizes a union as the employees’ exclusive bargaining representative, the employer has an obligation to bargain with the union in good faith in an attempt to reach a collectivebargaining agreement. That obligation is not delayed or otherwise impacted by this notice. The National Labor Relations Board is an agency of the United States Government and does not endorse any choice about whether employees should keep the current union, file a decertification petition, or support or oppose a representation petition filed by another union.205 The AFL–CIO proposes further revisions, specifically, that the following, italicized words be added to the General Counsel’s proposed revisions: An employer may lawfully recognize a union based on evidence (such as signed authorization cards) indicating that a majority of employees in an appropriate unit desire its representation, even absent an election supervised by the National Labor Relations Board. The National Labor Relations Board is an agency of the United States Government and does not endorse any choice about whether employees should keep the current union, file a petition to certify the current union, file a decertification petition, or support or oppose a representation petition filed by another union.206 We agree that the notice should contain the additions suggested by both the General Counsel and the AFL–CIO. As the General Counsel notes, such wording gives employees a more complete picture of their rights and emphasizes the Board’s neutrality in these matters. We also agree that the text of the final rule should include the wording of the notice. We have modified the text of the final rule, § 103.21 accordingly. In addition, consistent with the additions to the notice set forth above, we modify the text of the final rule, § 103.21 to require 205 Comment 204 Comment VerDate Sep<11>2014 of GC Robb. 19:25 Mar 31, 2020 206 Reply Jkt 250001 PO 00000 of GC Robb. Comment of AFL–CIO. Frm 00024 Fmt 4701 Sfmt 4700 employers to post a notice informing employees of their right to file ‘‘a petition’’—not ‘‘a decertification or rival union petition.’’ The General Counsel also argues that, in addition to notice-posting, the Board should require employers to distribute individual notices to employees via a second method of the employers’ choosing,207 and another commenter supports this recommendation.208 We believe that it is appropriate for the final rule to mirror the requirements that apply to petitions for elections. Accordingly, consistent with the 2019 Election Rule that is scheduled to take effect in Spring of 2020,209 the instant final rule specifies that the employer shall post the notice ‘‘in conspicuous places, including all places where notices to employees are customarily posted,’’ and shall also distribute it ‘‘electronically to employees in the petitioned-for unit, if the employer customarily communicates with its employees electronically.’’ G. Final-Rule Amendment Regarding Proof of Majority-Based Recognition in the Construction Industry The Board received numerous comments on the proposal to redefine the evidence required to prove that a construction-industry employer and labor organization have established a majority-based collective-bargaining relationship under Section 9(a) of the Act. We have carefully reviewed and considered these comments, as discussed below. 1. Comments Regarding Board and Court Precedent Many commenters support the requirement that positive evidence is needed to prove that a union demanded recognition as the exclusive bargaining representative and that the employer granted it based on a demonstration of majority support. More specifically, the commenters contend that the rule will restore the protection of employee free choice that Congress intended to ensure when it enacted Section 8(f).210 We agree. The Deklewa Board properly struck a balance between employee free choice and stability in bargaining relationships, consistent with the congressional intent expressed in Section 8(f). As discussed in Section I.B.5. above, Section 8(f) permits construction-industry unions 207 Comment of GC Robb. Comment of NRWLDF. 209 See 84 FR at 69591. 210 Comments of COLLE; Associated General Contractors of America (AGC); GC Robb; NRWLDF; Miller & Long Company, Inc. (M&L); the Chamber; ABC; NFIB. 208 Reply E:\FR\FM\01APR2.SGM 01APR2 jbell on DSKJLSW7X2PROD with RULES2 Federal Register / Vol. 85, No. 63 / Wednesday, April 1, 2020 / Rules and Regulations and employers to enter collectivebargaining relationships absent employee majority support, but such relationships do not bar election petitions. The Deklewa Board adopted a presumption that bargaining relationships in the construction industry are governed by Section 8(f), and it made 8(f) agreements enforceable for their term. Moreover, the Board abolished the flawed conversion doctrine and held that 8(f) relationships could develop into 9(a) relationships only through Board election or voluntary recognition—and, in the latter case, only ‘‘where that recognition is based on a clear showing of majority support among the unit employees.’’ 282 NLRB at 1387 fn. 53. The Board’s current Staunton Fuel standard, which requires only contract language to establish a 9(a) relationship, is contrary to these fundamental principles. See King’s Fire Protection, Inc., 362 NLRB 1056, 1063 fn. 24 (2015) (Member Miscimarra, dissenting in part) (observing that the Staunton Fuel standard ‘‘is even more troubling than the conversion doctrine that the Board abandoned in Deklewa’’ because, ‘‘[u]nder [Staunton Fuel], mere words are sufficient to cause ‘pre-hire’ recognition to convert to Sec[tion] 9(a) status, even where . . . there has been no showing of actual employee majority support’’). By requiring positive evidence of employee majority support to establish a 9(a) relationship, the instant rule will restore the proper balance of interests—employee free choice on one hand, labor-relations stability on the other—intended by Congress and safeguarded in Deklewa. In addition, many commenters note that the D.C. Circuit repeatedly has rejected the Staunton Fuel test, and they urge the Board to adopt the court’s position that contract language alone cannot create a 9(a) bargaining relationship.211 As discussed in Section I.B.5. above, in Nova Plumbing and Colorado Fire Sprinkler, the D.C. Circuit criticized the Board’s reliance solely on contract language, finding it inconsistent with the majoritarian principles set forth by the Supreme Court in Garment Workers. Colorado Fire Sprinkler, 891 F.3d at 1038–1039; Nova Plumbing, 330 F.3d at 536–537. See also M & M Backhoe Serv., Inc. v. NLRB, 469 F.3d 1047, 1050 (D.C. Cir. 2006) (explaining that ‘‘a union seeking to convert its section 8(f) relationship to a section 9(a) relationship may either petition for a representation election or demand recognition from the employer 211 Comments of COLLE; AGC; GC Robb; the Chamber; ABC; CDW. VerDate Sep<11>2014 19:25 Mar 31, 2020 Jkt 250001 by providing proof of majority support,’’ and finding a 9(a) relationship based on signed authorization cards). As the court explained, ‘‘while an employer and a union can get together to create a Section 8(f) pre-hire agreement, only the employees, through majority choice, can confer Section 9(a) status on a union.’’ Colorado Fire Sprinkler, 891 F.3d at 1040 (emphasis in original). Thus, in order ‘‘to rebut the presumption of Section 8(f) status, actual evidence that a majority of employees have thrown their support to the union must exist and, in Board proceedings, that evidence must be reflected in the administrative record.’’ Id. As some commenters note, the court’s rejection of the Board’s reliance solely on contract language is a strong reason to support the instant rule, as every Board decision can be reviewed by the D.C. Circuit. 29 U.S.C. 160(f). On the other hand, other commenters argue that the proposed rule is not appropriate because the NPRM incorrectly interpreted Staunton Fuel and the D.C. Circuit’s decisions.212 Specifically, they argue that the court stated that contract language and intent are relevant factors, so those factors should be determinative where countervailing evidence is weak or nonexistent. Some commenters also rely on the D.C. Circuit’s decision in Allied Mechanical Services, Inc. v. NLRB, 668 F.3d 758 (DC Cir. 2012). Contrary to the commenters, the court has ‘‘held that ‘contract language’ and ‘intent’ of the union and company alone generally cannot overcome the Section 8(f) presumption’’ because allowing them to do so ‘‘runs roughshod over the principles of employee choice established in Supreme Court precedent.’’ Colorado Fire Sprinkler, 891 F.3d at 1039 (internal quotations omitted). Further, although the court has indicated that contract language and intent ‘‘certainly’’ are not determinative factors when ‘‘the record contains strong indications that the parties had only a section 8(f) relationship,’’ id., its decisions do not compel the inverse proposition—i.e., that contract language and intent are determinative where record evidence of 8(f) status is weak. Such a proposition disregards that under Deklewa, bargaining relationships in the construction industry are presumed to be governed by Section 8(f), and therefore no evidence is required to establish 8(f) status. In any event, the court clearly has not 212 Comments of AFL–CIO; Road Sprinkler Fitters Local Union No. 669 (Local 669); IBEW; IUOE; North America’s Building Trades Unions (NABTU); UA. PO 00000 Frm 00025 Fmt 4701 Sfmt 4700 18389 foreclosed requiring positive evidence demonstrating majority support in all cases. And as we have explained, requiring such evidence would effectuate the Act’s purposes by protecting employee free choice, accomplish the congressional intent expressed in Section 8(f), and conform to the majoritarian principles set forth by the Supreme Court in Garment Workers. In addition, Allied Mechanical does not support the commenters’ position. In Allied Mechanical, the court found that a construction-industry union established 9(a) status by requesting recognition based on signed authorization cards and by entering a settlement agreement that contained an affirmative bargaining order predicated on its previous majority support. 668 F.3d at 768–769. Thus, the union did not solely rely on contract language to demonstrate its 9(a) status. Moreover, we also note that, in pre– Staunton Fuel cases, the United States Courts of Appeals for the First and Fourth Circuits also required a contemporaneous showing of majority support to establish a 9(a) relationship. American Automatic Sprinkler Sys., Inc. v. NLRB, 163 F.3d 209, 221–222 (4th Cir. 1998) (‘‘The Board’s willingness to credit the employer’s voluntary recognition absent any contemporaneous showing of majority support would reduce this time-honored alternative to Board-certified election to a hollow form which, though providing the contracting parties stability and repose, would offer scant protection of the employee free choice that is a central aim of the Act.’’), cert. denied 528 U.S. 821 (1999); NLRB v. Goodless Elec. Co., 124 F.3d 322, 324, 330 (1st Cir. 1997) (‘‘Voluntary recognition requires the union’s unequivocal demand for, and the employer’s unequivocal grant of, voluntary recognition as the employees’ collective[-]bargaining representative based on the union’s contemporaneous showing of majority[-]employee support.’’). Further, the United States Court of Appeals for the Eighth Circuit relied on both contract language and additional evidence in finding that a construction-industry union established 9(a) status in NLRB v. American Firestop Solutions, Inc., 673 F.3d 766, 770–771 (8th Cir. 2012). In sum, we find that Board and court precedent fully support requiring positive evidence demonstrating majority-employee union support to establish a 9(a) relationship in the construction industry. E:\FR\FM\01APR2.SGM 01APR2 18390 Federal Register / Vol. 85, No. 63 / Wednesday, April 1, 2020 / Rules and Regulations 2. Comments Regarding Employee Free Choice As many commenters contend, requiring positive evidence of majorityemployee union support will also better effectuate the purposes of the Act.213 The current Staunton Fuel standard undermines employees’ Section 7 rights by effectively reintroducing the conversion doctrine that the Deklewa Board repudiated and by subjecting employees to the contract bar precluding elections for several years, even where there has never been any extrinsic proof that a majority of the employees support the union.214 As the commenters point out, the protection of employees’ Section 7 free-choice rights is a central purpose of the Act, and the rule would protect those rights. Further, as another commenter notes, the rule will also provide greater stability in the construction industry by clarifying the requirements to create 9(a) relationships.215 3. Comments Regarding Collusion jbell on DSKJLSW7X2PROD with RULES2 Several commenters contend that the Board’s current standard turns a blind eye to union and employer collusion in the construction industry, trampling employee free choice.216 We agree. By allowing unions and employers to enter into 9(a) relationships based on contract language alone, employees’ rights can be usurped with a stroke of a pen. Further, as the commenters point out, this is not mere speculation but has been demonstrated in several Board decisions in which parties falsified majority support. See, e.g., Colorado Fire Sprinkler, Inc., 364 NLRB No. 55, slip op. at 5 (Member Miscimarra, dissenting) (noting that parties signed agreement recognizing 9(a) status before single employee hired); King’s Fire Protection, Inc., 362 NLRB at 1059 (Member Miscimarra, dissenting in part) (same); Triple C Maintenance, 327 NLRB 42, 42 fn. 1 (1998) (pre–Staunton Fuel, finding 9(a) relationship based on recognition clause even though no employees when relationship began), enfd. 219 F.3d 1147 (10th Cir. 2000); Oklahoma Installation Co., 325 NLRB 213 Comments of Representatives Foxx and Walberg; CNLP; COLLE; AGC; NRWLDF; the Chamber; ABC; NFIB; CDW. See also Reply Comment of CNLP. 214 We also note that the Staunton Fuel standard gives rise to a post-contract presumption of continuing majority support absent positive evidence that the union has ever enjoyed such support. 215 Comment of Mechanical Contractors Association of America (MCAA). 216 Comments of M&L; GC Robb; NRWLDF; the Chamber. VerDate Sep<11>2014 19:25 Mar 31, 2020 Jkt 250001 741, 741–742, 745 (1998) (same), enf. denied 219 F.3d 1160 (10th Cir. 2000). Thus, Staunton Fuel has effectively permitted construction-industry unions and employers to collude at the expense of employees. For these reasons, we disagree with other commenters’ contention that there is little evidence that the 9(a) process is being abused or that Staunton Fuel has negatively affected employee free choice.217 4. Comments Regarding Definition of Positive Evidence Some commenters request that we define what ‘‘positive evidence’’ is sufficient to demonstrate majorityemployee union support.218 One commenter contends that the Board should permit authorization cards, dues-checkoff cards, membership applications, or any other evidentiary means to establish majority status, consistent with 9(a) recognition in other industries.219 Another commenter notes that the preamble to the NPRM referred to extrinsic evidence in the form of employee signatures on authorization cards or a petition, but the text of the proposed rule did not.220 Although we find it unnecessary to modify the proposed rule’s wording in this regard, we clarify that this rule is not intended to change the current standards regarding the forms of evidence that are acceptable to demonstrate majority support. In Deklewa, the Board stated that it did ‘‘not mean to suggest that the normal presumptions would not flow from voluntary recognition accorded to a union by the employer of a stable work force where that recognition is based on a clear showing of majority support among the unit employees, e g., a valid card majority.’’ 282 NLRB at 1387 fn. 53 (citing Island Construction Co., 135 NLRB 13 (1962)). ‘‘That is,’’ the Board continued, Deklewa was not ‘‘meant to suggest that unions have less favored status with respect to construction[]industry employers than they possess with respect to those outside the construction industry.’’ Id. The instant rule is not intended to change that principle. Accordingly, the same contemporaneous showing of majority support that would suffice to establish that employees wish to be represented by a labor organization in collective bargaining with their employer under Section 9(a) in non-construction industries will also suffice to establish recognition under Section 9(a) in 217 Comments 218 See, of LIUNA MAROC; IUOE; UA. e.g., Comment of Local 669. 219 Id. 220 Comment PO 00000 Frm 00026 of AGC. Fmt 4701 Sfmt 4700 construction-industry bargaining relationships. It is well established that signed authorization cards or petitions from a majority of bargaining-unit employees is adequate proof, as is the result of a private election conducted under the auspices of a neutral party pursuant to a voluntary pre-recognition or neutrality agreement. There is less certainty in Board precedent whether other extrinsic evidence, such as that mentioned by Local 669, would be sufficient to prove majority support.221 Accordingly, we leave any further development of these evidentiary standards to future proceedings. Cf. Mobil Oil Expl. & Producing Se. Inc., 498 U.S. at 231 (‘‘[A]n agency need not solve every problem before it in the same proceeding.’’); Advocates for Highway & Auto Safety, 429 F.3d at 1147 (‘‘Agencies surely may, in appropriate circumstances, address problems incrementally.’’). 5. Comments Regarding Prospective Application Some commenters argue that the Board should apply the rule only to construction-industry bargaining relationships entered into on or after the date the rule goes into effect.222 We agree, and we have modified the regulatory text to specify that the rule applies only prospectively to a voluntary recognition extended on or after the effective date of the rule and to any collective-bargaining agreement entered into on or after the date of voluntary recognition extended on or after the effective date of the rule. Relatedly, two commenters question how the rule will affect successor agreements.223 We clarify that, if the successor agreement is reached by parties that entered into a voluntary 9(a) recognition agreement before the effective date of the rule, then the rule will not apply to that agreement. Further, once parties prove a 9(a) relationship under the rule, they will not be required to reestablish their 9(a) status for successor agreements. 6. Comments Regarding Section 10(b) of the Act Some commenters urge the Board to incorporate a Section 10(b) 6-month limitation for challenging a construction-industry union’s majority status.224 In Casale Industries, the Board held that it would ‘‘not entertain a claim that majority status was lacking at the 221 See discussion of evidentiary factors in Deklewa, 282 NLRB at 1383–1384. 222 Comments of IUOE; LlUNA MAROC. 223 Comments of MCAA; LIUNA MAROC. 224 Comments of NABTU; Local 669. See also Reply Comment of Local 669. E:\FR\FM\01APR2.SGM 01APR2 jbell on DSKJLSW7X2PROD with RULES2 Federal Register / Vol. 85, No. 63 / Wednesday, April 1, 2020 / Rules and Regulations time of recognition’’ where ‘‘a construction[-]industry employer extends 9(a) recognition to a union, and 6 months elapse without a charge or petition.’’ 311 NLRB 951, 953 (1993). The D.C. and Fourth Circuits have expressed doubts regarding that aspect of Casale, while the Tenth and Eleventh Circuits have upheld the Board’s position. Compare Nova Plumbing, 330 F.3d at 539, and American Automatic Sprinkler Systems, 163 F.3d 209, 218 fn. 6 (4th Cir. 1998), with Triple C Maintenance, 219 F.3d 1147, 1156–1159 (10th Cir. 2000), and NLRB v. Triple A Fire Protection, 136 F.3d 727, 736–737 (11th Cir. 1998). Some former Board Members also have disagreed with that aspect of Casale. See King’s Fire Protection, Inc., 362 NLRB at 1062 (Member Miscimarra, dissenting in part); Saylor’s Inc., 338 NLRB 330, 332– 333 fn. 9 (2002) (Member Cowen, dissenting); Triple A Fire Protection, 312 NLRB 1088, 1089 fn. 3 (1993) (Member Devaney, concurring). Cf. Painters (Northern California Drywall Assn.), 326 NLRB 1074, 1074 fn. 1 (1998) (Member Brame finding it unnecessary to pass on validity of Casale). For several reasons, we decline to adopt a Section 10(b) 6-month limitation on challenging a construction-industry union’s majority status by filing a petition for a Board election, and we overrule Casale to the extent that it is inconsistent with the instant rule. Specifically, we overrule Casale’s holding that the Board will not entertain a claim that majority status was lacking at the time of recognition where a construction-industry employer extends 9(a) recognition to a union and 6 months elapse without a petition. As an initial matter, we note that Section 10(b) applies only to unfair labor practices and that this aspect of the rule addresses only representation proceedings—i.e., whether an election petition is barred because a construction-industry employer and union formed a 9(a) rather than an 8(f) collective-bargaining relationship. Further, we agree with the doubts expressed by the D.C. and Fourth Circuits, and by some former Board Members, regarding Section 10(b)’s applicability to challenges to a construction-industry union’s purported 9(a) status. Nova Plumbing, 330 F.3d at 539; American Automatic Sprinkler Sys., 163 F.3d at 218 fn. 6; King’s Fire Protection, Inc., 362 NLRB at 1062 (Member Miscimarra, dissenting in part); Saylor’s, 338 NLRB at 332–333 fn. 9; Triple A Fire Protection, 312 NLRB at 1089 fn. 3. It is not unlawful for a construction-industry employer and VerDate Sep<11>2014 19:25 Mar 31, 2020 Jkt 250001 union to establish an 8(f) relationship without majority-employee union support. Thus, the issue is whether the parties formed an 8(f) or a 9(a) relationship, and only if the parties formed a 9(a) relationship could there be an unfair labor practice that would trigger Section 10(b)’s 6-month limitation. See also Brannan Sand & Gravel Co., 289 NLRB at 982 (predating Casale; nothing ‘‘precludes inquiry into the establishment of construction[]industry bargaining relationships outside the 10(b) period’’ because ‘‘[g]oing back to the beginning of the parties’ relationship . . . simply seeks to determine the majority or nonmajority[]based nature of the current relationship and does not involve a determination that any conduct was unlawful’’). In other words, Casale begs the question by assuming the very 9(a) status that ought to be the object of inquiry. In addition, we find that the Board’s pertinent reasoning in Casale was flawed. See King’s Fire Protection, Inc., 362 NLRB at 1062–1063 (Member Miscimarra, dissenting in part). For decades, the Board had held that in other industries, Section 10(b) barred untimely allegations that an employer unlawfully extended 9(a) recognition to a minority union. North Bros. Ford, Inc., 220 NLRB 1021, 1021–1022 (1975) (citing Machinists Local 1424 (Bryan Mfg.) v. NLRB, 362 U.S. 411 (1960)). In Casale, the Board stated that ‘‘[p]arties in the construction industry are entitled to no less protection.’’ 311 NLRB at 953. However, the Casale Board failed to recognize that employees and rival unions will likely presume that a construction-industry employer and union entered an 8(f) collectivebargaining agreement, which is virtually certain to have a term longer than 6 months. Thus, it is highly unlikely that they will file a petition challenging the union’s status within 6 months of recognition. Finally, and most significantly, we find that Casale’s requirement that an election petition be filed within 6 months to challenge a purported 9(a) recognition in the construction industry improperly discounts the importance of protecting employee free choice as recognized by Congress in enacting Section 8(f) and by the Board and the Supreme Court in deciding Deklewa and Garment Workers, respectively. Garment Workers, 366 U.S. at 737–741; King’s Fire Protection, Inc., 362 NLRB at 1062 (Member Miscimarra, dissenting in part); John Deklewa & Sons, 282 NLRB at 1378. Therefore, we overrule Casale in relevant part and will evaluate a construction-industry union’s purported PO 00000 Frm 00027 Fmt 4701 Sfmt 4700 18391 9(a) recognition at any time that an election petition is filed. 7. Comments Regarding Filing Unfair Labor Practice Charges Some commenters argue that the rule is unnecessary because it is already unlawful for any labor organization to enter into a 9(a) collective-bargaining agreement with any employer absent majority support.225 They correctly point out that an employer violates the Act by granting Section 9(a) recognition to a union that does not enjoy majority status, and that a union similarly violates the Act by accepting such recognition when it does not represent a majority of employees. The remedy in such situations is to order the parties to cease recognition of the union as employees’ collective-bargaining representative and to cease maintaining or giving effect to the collectivebargaining agreement. The commenters fail to recognize that, until there is a Board decision finding merit to such unfair labor practice allegations, any election petition remains barred. Moreover, when a decision issues finding merit in such allegations, the remedy does not include an election. There is no remedy of a Board election in an unfair labor practice case finding that an employer and union entered into a Section 9(a) collective-bargaining agreement when the union did not enjoy majority support. By requiring positive evidence that a construction-industry union demanded 9(a) recognition and that the employer granted such recognition based on a contemporaneous showing of majority-employee support, the rule better protects employee free choice in a representation proceeding.226 8. Comments Regarding Effects on Certain Bargaining Relationships Some commenters argue that the rule will adversely affect older bargaining relationships in the construction industry and/or small constructionindustry unions.227 They argue that the longer a bargaining relationship lasts, the more difficult it will be for a union to produce positive evidence of majority support when the demand for recognition could have occurred years or even decades prior. Therefore, those bargaining relationships would become 225 Comments of NABTU; Professor Kulwiec; Senator Murray; Local 669; Springfield. See also Reply Comments of NABTU; Local 669. 226 We note that the rule applies to the question of whether an election petition is barred in a representation proceeding and does not directly implicate unfair labor practice rules. 227 Comments of NABTU; AFL–CIO; IUOE; CWA; Professor Kulwiec; Local 304; MRCC; AFT. See also Reply Comment of Local 669. E:\FR\FM\01APR2.SGM 01APR2 18392 Federal Register / Vol. 85, No. 63 / Wednesday, April 1, 2020 / Rules and Regulations less stable due to the passage of time. Relatedly, these commenters contend that the rule imposes an onerous new recordkeeping requirement and that small local unions would lack the resources to retain records of employee support. As explained above, the rule will apply only prospectively to an employer’s voluntary recognition extended on or after the effective date of the rule and to any collective-bargaining agreement entered into on or after the date of voluntary recognition extended on or after the effective date of the rule. Thus, the rule will not affect or destabilize longstanding bargaining relationships in the construction industry. Further, although we acknowledge that the rule will incentivize unions to keep a record of majority-employee union support moving forward, we do not consider such a minor administrative inconvenience a sufficient reason to permit employers and unions to circumvent employees’ rights. jbell on DSKJLSW7X2PROD with RULES2 9. Comments Regarding Frequency of Section 9(a) Agreements in the Construction Industry Some commenters argue that the rule is not appropriate because the issue of whether a construction-industry employer recognized or entered into a petition-barring agreement with a union as the 9(a) representative of its employees occurs very infrequently.228 However, what matters here is the statutory right, not how often it is implicated. The Act protects employees’ free choice to select their 9(a) bargaining representative. As one commenter notes, even though the rule may affect a small number of cases, that does not mean that there are not good reasons to adopt it.229 10. Comments Regarding Issues in Representation Proceedings Other commenters raise concerns regarding the Board’s ability to rule on parol evidence in representation-case proceedings, which are non-adversarial and do not allow credibility determinations.230 However, in cases where there are authentication issues, the Board expects that the process will be similar to that followed in an administrative investigation of a showing of interest: the Region will examine the signatures and handwriting comparators to determine whether a majority of unit employees supported the union at the time of recognition. Thus, these concerns are unwarranted. 11. Comments Regarding Contract Law One commenter asserts that contract language alone should be sufficient to demonstrate majority status because principles of contract construction hold parties to their obligations, including contract wording stating that a union has majority support.231 Relatedly, other commenters argue that the instant rule is contrary to the rules of contract law because it would require extrinsic evidence regardless of how clear the contract language is.232 However, construction-industry employers and unions may enter a 9(a) relationship only where a majority of employees support the union. Thus, contract language alone is insufficient where a majority of employees never supported the union. Further, requiring positive evidence of majority support, even where contract language initially appears clear, is necessary to ensure that unions and employers do not collude, thereby protecting employee free choice consistent with the congressional intent expressed in Section 8(f) and with the majoritarian principles discussed by the Supreme Court in Garment Workers, 366 U.S. at 737. 12. Comments Regarding Adequacy of Justification for Rule Several commenters argue that the Board failed to adequately justify the proposed rule, asserting that the Board failed to offer evidence in support, analyze relevant data, or consider contrary arguments.233 We disagree. The Board has fully justified the rule based on available evidence and relevant data, including prior Board precedent in Deklewa and its progeny, negative reception by the D.C. Circuit in Nova Plumbing and Colorado Fire Sprinkler, and the rights protected by the Act, particularly employees’ right of free choice in selecting (or refraining from selecting) a 9(a) representative. Further, we have fully considered and addressed all contrary arguments, as demonstrated by our responses in this rulemaking. 13. Comments Suggesting Modifications to the Rule Some commenters suggest modifications to the rule. First, some commenters propose that the rule should not apply to RM petitions.234 However, it is well of Professor Kulwiec; EPI; IUOE; MRCC; LIUNA MAROC. 229 Comment of NRWLDF. 230 Comments of NABTU; IUOE. See also Reply Comment of NABTU. VerDate Sep<11>2014 19:25 Mar 31, 2020 Jkt 250001 235 Comments of AGC; Senator Murray; IUOE. of M&L. 237 Comment of CNLP. 238 An employer in the construction industry may recognize a union as the 8(f) bargaining representative of employees it has yet to hire. Indeed, an 8(f) agreement is often referred to as a ‘‘pre-hire’’ agreement. 236 Comment 231 Comment 228 Comments established that an 8(f) relationship will not bar an RM petition. See John Deklewa & Sons, 282 NLRB at 1385 fn. 42. Thus, it is appropriate to require the party seeking to establish 9(a) status to present positive evidence of a contemporaneous showing of majority support, and we reject the commenters’ proposal. Second, some commenters contend that the issue of whether contract language alone can establish 9(a) status has implications beyond elections—i.e., to unfair labor practice proceedings— and that the Board should address those contexts.235 However, this request is beyond the scope of the rule, which only addresses representation proceedings. Thus, we deny the request. We will address any unfair labor practice issues as they arise in future, appropriate proceedings. Cf. Mobil Oil Expl. & Producing Se. Inc., 498 U.S. at 231 (‘‘[A]n agency need not solve every problem before it in the same proceeding.’’); Advocates for Highway & Auto Safety, 429 F.3d at 1147 (‘‘Agencies surely may, in appropriate circumstances, address problems incrementally.’’). Third, one commenter proposes to prohibit automatic renewal of 8(f) agreements.236 But our concern here is to remove obstructions to Section 8(f)’s second proviso, and automatic renewal of 8(f) agreements does not obstruct that proviso because employees and rival unions are free to file election petitions at any time an 8(f) agreement is in effect, as the Board made clear in Deklewa. Accordingly, we reject this proposal. Fourth, one commenter proposes that we require a contemporaneous showing of majority support in all industries because collective-bargaining relationships in other industries are also lawful only if the union had majority support at the time of recognition or Board election.237 However, the construction industry is unique in allowing voluntary recognition of unions that are supported by a minority of employees or by no employees at all,238 and this rule is intended to address issues, unique to that industry, that arise when assessing whether a relationship is properly treated as a 9(a), rather than 8(f), relationship. Thus, we reject the commenter’s proposal. Relatedly, the same commenter requests that we specify that 9(a) recognition can of Professor Kulwiec. of Senator Murray; CWA. 233 Comments of AFL–CIO; NABTU; EPI; United Brotherhood of Carpenters and Joiners of America; UA. See also Reply Comment of NABTU. 234 Comments of LIUNA MAROC; NABTU. 232 Comment PO 00000 Frm 00028 Fmt 4701 Sfmt 4700 E:\FR\FM\01APR2.SGM 01APR2 Federal Register / Vol. 85, No. 63 / Wednesday, April 1, 2020 / Rules and Regulations only occur if an employer employs a substantial and representative complement of employees. We note that the final rule does not disturb established precedent on this point. Finally, we reject one commenter’s argument that a 9(a) relationship should be created only through a Board election.239 This argument is contrary to well-established precedent permitting voluntary recognition. It is also at odds with language in the Act itself. See Section 9(a), 29 U.S.C. 159(a) (referring to representatives ‘‘designated or selected’’ for the purposes of collective bargaining); Section 9(c), 29 U.S.C. 159(c) (providing for a Board-conducted election based on a petition stating, in relevant part, that the employer ‘‘declines to recognize’’ a labor organization as employees’ 9(a) representative). jbell on DSKJLSW7X2PROD with RULES2 14. Comments Requesting Clarifications Some commenters seek clarifications regarding the rule. Two commenters question whether employers must review evidence of majority-employee union support at the time of recognition.240 This rule only requires the party seeking to establish 9(a) status to provide evidence demonstrating that a majority of unit employees supported the union at the time of recognition; the rule does not also require parties to show that the employer reviewed the evidence at that time. Another commenter seeks clarification regarding whether 9(a) relationships created before the effective date of the rule will automatically revert to 8(f) relationships.241 As explained, the rule will apply only prospectively to an employer’s voluntary recognition extended on or after the effective date of the rule and to any collective-bargaining agreement entered into on or after the date of voluntary recognition extended on or after the effective date of the rule. Thus, the rule will not disrupt longstanding 9(a) relationships. Two commenters ask whether the new voluntary-recognition window period, discussed in § 103.21(a) of the final rule, will apply to 9(a) bargaining relationships in the construction industry.242 Although we do not believe it is necessary to modify the wording of the final rule in this regard, the answer is yes—the window period applies, along with the other requirements of § 103.21(a). 239 Comment of NFIB. 240 Comments of NABTU; UA. 241 Comment of AGC. 242 Comments of the Chamber; Senator Murray. VerDate Sep<11>2014 19:25 Mar 31, 2020 Jkt 250001 Finally, one commenter questions how the rule will affect multi-employer bargaining units, me-too agreements, jobsite-only agreements, and voter eligibility.243 These questions are fact dependent, and we believe that they are more properly addressed as they arise in future, appropriate proceedings. IV. Justification for the Final Rule For all of the reasons set forth above and in the NPRM, we believe that all of the aspects of the final rule further the Act’s overarching goals of protecting employees’ free, informed choice in designating or selecting their representatives, while also promoting industrial stability and collective bargaining and ensuring that unions claiming Section 9(a) representative status have the requisite majorityemployee support. Accordingly, we find it appropriate to issue this final rule. V. Other Statutory Requirements A. The Regulatory Flexibility Act Final Regulatory Flexibility Analysis The Regulatory Flexibility Act of 1980, as amended by the Small Business Regulatory Enforcement Fairness Act of 1996 (RFA), 5 U.S.C. 601–612, requires an agency promulgating a final rule to prepare a final regulatory flexibility analysis when the regulation will have a significant impact on a substantial number of small entities. An agency is not required to prepare a final regulatory flexibility analysis if the agency head certifies that the rule will not have a significant economic impact on a substantial number of small entities. 5 U.S.C. 605(b). In the NPRM, although the Board believed that this rule would not have a significant economic impact on a substantial number of small entities, the Board issued its Initial Regulatory Flexibility Analysis (IRFA) to provide the public the fullest opportunity to comment on the proposed rule. See 84 FR at 39953. The Board solicited comments from the public that would shed light on potential compliance costs that may result from the rule and that the Board had not identified or anticipated. The RFA does not define either ‘‘significant economic impact’’ or ‘‘substantial number of small entities.’’ 244 Additionally, ‘‘[i]n the absence of statutory specificity, what is ‘significant’ will vary depending on the economics of the industry or sector to be regulated. The agency is in the best 243 Comment 244 5 PO 00000 of MCAA. U.S.C. 601. Frm 00029 Fmt 4701 Sfmt 4700 18393 position to gauge the small entity impacts of its regulations.’’ 245 We anticipate that the rule will impose low costs of compliance on small entities, related to reviewing and understanding the substantive changes to the blocking-charge policy, voluntaryrecognition-bar doctrine, and modified requirements for proof of majority-based voluntary recognition under Section 9(a) in the construction industry. There may also be a low cost for a small entity to prepare, post, and distribute a notice of voluntary recognition under the modified voluntary-recognition bar. In addition, there may be an unknown cost for small entities to participate in elections that might not have occurred but for the final rule and a de minimis cost for small labor unions representing employees in the building and construction trades to retain proof of their majority support. 1. Statement of the Need for, and Objectives of, the Rule Detailed descriptions of this final rule, its purpose, objectives, and the legal basis are contained earlier in the SUMMARY and SUPPLEMENTARY INFORMATION sections. In brief, the final rule includes three provisions that are necessary to accomplish the objective of better protecting the statutory rights of employees to express their views regarding representation. First, the final rule modifies the current blockingcharge policy and implements two new procedures to process representation petitions where a party files or has filed an unfair labor practice charge—a voteand-impound procedure or a vote-andcount procedure. Next, the final rule modifies the voluntary-recognition-bar doctrine by providing employees and rival unions with a 45-day window period in which to file an election petition after an employer voluntarily recognizes a union based on demonstrated majority support. Lastly, the final rule modifies the requirements for proof of majority-based voluntary recognition under Section 9(a) in the building and construction industry by eliminating the possibility of establishing Section 9(a) status based solely on contract language drafted by the employer and/or union. Thus, the final rule assists the Board in its fundamental obligation to protect employee free choice and Section 7 rights. 245 Small Business Administration Office of Advocacy, A Guide for Government Agencies: How to Comply with the Regulatory Flexibility Act 18 (Aug. 2018), https://www.sba.gov/sites/default/files/ advocacy/How-to-Comply-with-the-RFA-WEB.pdf (last visited Mar. 23, 2020). E:\FR\FM\01APR2.SGM 01APR2 18394 Federal Register / Vol. 85, No. 63 / Wednesday, April 1, 2020 / Rules and Regulations jbell on DSKJLSW7X2PROD with RULES2 2. Statement of the Significant Issues Raised by the Public Comments in Response to the Initial Regulatory Flexibility Analysis, a Statement of the Assessment of the Agency of Such Issues, and a Statement of any Changes Made in the Proposed Rule as a Result of Such Comments a. Response to Comments Concerning Estimated Compliance Costs of the Rule Several commenters criticized the Board’s quantification of costs associated with each of the three changes. Generally, the AFL–CIO asserts that the Board’s definition of an economic impact is underinclusive, its analysis was limited to easily quantifiable costs, and it failed to attempt to quantify other costs by assessing Board data. Regarding the blocking-charge policymodification, the AFL–CIO accuses the Board of incorrectly professing an inability to quantify the cost of participating in additional elections. It asserts that the Board has awarded such costs as a remedy in unfair labor practice cases and, therefore, could quantify such costs in the IRFA. Further, it claims that the Board could have used the same method used to quantify the cost of learning about the rule to quantify the cost of holding an election, i.e., specifying the personnel that would participate in an election, their wage rate, and a projection of hours spent on an election, or could have used election costs awarded in past arbitrations. Regarding the modification to the voluntary-recognition bar, the International Brotherhood of Electrical Workers asserts that the Board failed to assess the cost of ‘‘delayed bargaining and disruption of bargaining relationships that would be caused by the proposed notice posting requirement.’’ However, no data or further information was provided. Both the AFL–CIO and the International Brotherhood of Electrical Workers generally fault the Board for failing to analyze certain costs associated with the change in the evidence necessary to prove a majoritybased bargaining relationship in the construction industry and to thus block an election petition. According to the International Brotherhood of Electrical Workers, the Board further failed to analyze the cost of the disruption to established collective-bargaining relationships in the construction industry that would occur because of the rule. Respectfully, those commenters do not raise direct economic impacts under the RFA. The RFA does not require a VerDate Sep<11>2014 19:25 Mar 31, 2020 Jkt 250001 regulatory agency to consider speculative and wholly discretionary responses to the rule, or the indirect impact on every stratum of the economy. What the statute requires is that the agency consider the direct burden that compliance with a new regulation will likely impose on small entities. See Mid-Tex Elec. Coop., Inc. v. FERC, 773 F.2d 327, 342 (DC Cir. 1985) (‘‘[I]t is clear that Congress envisioned that the relevant ‘economic impact’ was the impact of compliance with the proposed rule on regulated small entities’’); accord White Eagle Coop. Ass’n v. Conner, 553 F.3d 467, 478 (7th Cir. 2009); Colorado State Banking Bd. v. Resolution Trust Corp., 926 F.2d 931, 948 (10th Cir. 1991). This construction of the RFA, requiring agencies to consider only direct compliance costs, finds support in the text of that Act. Section 603(a) of the RFA states that if an IRFA is required, the IRFA ‘‘shall describe the impact of the proposed rule on small entities.’’ 5 U.S.C. 603(a). Although the term ‘‘impact’’ is undefined, its meaning can be gleaned from Section 603(b), which recites the required elements of an IRFA. One such element is ‘‘a description of the projected reporting, recordkeeping and other compliance requirements of the proposed rule, including an estimate of the classes of small entities which will be subject to the requirement and the type of professional skills necessary for preparation of the report or record.’’ 5 U.S.C. 603(b)(4). Section 604 further corroborates the Board’s conclusion, as it contains an identical list of requirements for a final regulatory flexibility analysis (if one is required). 5 U.S.C. 604(b)(4). Additional support for confining the regulatory analysis to direct compliance costs is found in an authoritative guide published by the Office of Advocacy of the United States Small Business Administration (SBA). In that guide—A Guide for Government Agencies: How to Comply with the Regulatory Flexibility Act (SBA Guide) (Aug. 2018), https://www.sba.gov/sites/ default/files/advocacy/How-to-Complywith-the-RFA-WEB.pdf-the SBA explains that ‘‘other compliance requirements’’ under section 603 include things such as capital costs for equipment, costs of modifying existing processes and procedures, lost sales and profits, changes in market competition, extra costs associated with the payment of taxes or fees, and hiring employees. SBA Guide at 37. These are all direct, compliance-based costs. In the IRFA, we noted that the only identifiable compliance costs imposed by the proposed rule related to PO 00000 Frm 00030 Fmt 4701 Sfmt 4700 reviewing and understanding the substantive changes and the minimal cost associated with the posting of a notice of voluntary recognition. 84 FR at 39956. Otherwise, there will be no ‘‘reporting, recordkeeping and other compliance requirements’’ for small entities. See 5 U.S.C. 603(b)(4) & 604(b)(4). The same is true of the final rule, except to the extent that the final rule requires electronic distribution of notices to employees where an employer customarily communicates with employees electronically—at most, a minimal additional cost. Consistent with these principles, the Board rejects the view that it must analyze the indirect and speculative costs of delayed bargaining or the disruption of bargaining relationships. The D.C. Circuit has firmly rejected the notion that a regulating agency must analyze every indirect and remote economic impact. See Mid-Tex Elec. Coop., Inc., 773 F.2d at 343 (‘‘Congress did not intend to require that every agency consider every indirect effect that any regulation might have on small businesses in any stratum of the national economy.’’). ‘‘[R]equir[ing] an agency to assess the impact on all of the nation’s small businesses possibly affected by a rule would be to convert every rulemaking process into a massive exercise in economic modeling, an approach we have already rejected.’’ Cement Kiln Recycling Coal. v. EPA, 255 F.3d 855, 869 (D.C. Cir. 2001) (citing Mid-Tex Elec. Coop., Inc., 773 F.2d at 343). Notwithstanding the indirect nature of the potential impacts raised by these comments, we also disagree with the notion that the rule will upset existing collective-bargaining relationships. We specifically note that the final rule regarding the requirement of proof to demonstrate majority-based 9(a) status in the construction industry has been clarified to reflect that it will apply only to voluntary recognitions extended on or after the effective date of this rule and to any collective-bargaining agreement entered into on or after the date of voluntary recognition extended on or after the effective date of this rule. Thus, established bargaining relationships will not be disrupted. Further, we believe that the rule will promote employees’ statutory right of free choice on questions concerning representation by removing unnecessary barriers to the fair and expeditious resolution of such questions through the preferred means of a Board-conducted secret-ballot election. Labor-management stability will be promoted when employees’ rights are respected. E:\FR\FM\01APR2.SGM 01APR2 Federal Register / Vol. 85, No. 63 / Wednesday, April 1, 2020 / Rules and Regulations Furthermore, while the Board recognized the possibility that small employers and unions may have to prepare for and participate in elections that may not have occurred but for the rule, such a cost is also speculative. Even if such a cost could be quantified, given how relatively infrequently the issues in this rule arise in Board proceedings, the cost would not affect a substantial number of small entities. As we explain below, the rule would annually impact only 744 out of approximately 6 million small entities. See Section V.A.4. The Board has neither a method to accurately determine the number of elections that may occur as a result of the rule nor a method to quantify the cost of participating in an election. In the cases cited by the AFL–CIO where the Board has awarded elections costs as an extraordinary remedy, the aggrieved party requested costs associated with an election that had already occurred, Texas Super Foods, 303 NLRB 209 (1991), or costs associated with ‘‘a prolonged attempt at organization, requiring extraordinary expenditures,’’ J. P. Stevens & Co., 244 NLRB 407, 458 (1979), but neither decision stated the amount awarded.246 The unknown cost of each of those elections was unique to those particular elections, as are the costs associated with all elections. The commenters do not appear to appreciate the number of variables that may come into play when attempting to quantify the cost of an election, such as the size of the petitioned-for unit, number of facilities, geographic location, or strength of opposition or favorability to union organization. Simply put, any attempt to quantify this cost would be incredibly speculative. jbell on DSKJLSW7X2PROD with RULES2 b. Response to Comments Concerning Economic Impact on Small Labor Unions The International Brotherhood of Electrical Workers and the AFL–CIO criticize the Board’s IRFA analysis for failing to adequately acknowledge and assess the potential impact of the rule on small labor unions, particularly local labor unions. Neither commenter has identified a specific ‘‘impact’’ that the IRFA did not address or that is not addressed in this Section. In reviewing the comments on the IRFA, we find no other compliance costs to small labor 246 The arbitration decision cited by the AFL– CIO, Yale-New Haven Hospital, Arbitration Proceedings Before Margaret M. Kern (Oct. 23, 2007), includes an award of organizing expenses for the union, but there, too, the union calculated and submitted the expenses. Moreover, neither the employer nor the union are within the SBA’s small entity size standard. See fns. 250 & 254. VerDate Sep<11>2014 19:25 Mar 31, 2020 Jkt 250001 unions, other than the very low cost relating to reviewing and understanding the rule (and, in some cases, a de minimis cost to retain records relating to proof of majority status), and no evidence presented shows that any additional indirect cost to small labor unions would constitute a significant impact. c. Response to Comments Concerning Recordkeeping Requirements The Board’s IRFA stated that there may be a recordkeeping cost imposed on small construction-industry labor unions, relating to the retention of positive evidence that they demanded recognition as the majority-supported collective-bargaining representative of employees in the building and construction industries and that the employer granted such recognition. See 84 FR at 39956. One commenter speculates that the rule will create an onerous new recordkeeping requirement under which a union is required to maintain records indicating its majority support in perpetuity.247 Another commenter further speculates that small local labor unions lack the sophisticated record-retention systems that would be necessary under the rule.248 And still another commenter asserts that the rule will require unions to expend funds to retain the evidence of majority support.249 No commenter has identified any such complex or sophisticated recordkeeping requirement. The RFA defines a ‘‘recordkeeping requirement’’ as ‘‘a requirement imposed by an agency on persons to maintain specified records,’’ 5 U.S.C. 601(8), and the rule directly imposes no such requirement but we acknowledge the very high likelihood that small construction industry labor unions will choose to do so. Under this rule, however, there is no reason for a small labor organization to implement a record-retention system that is more sophisticated than their normal-courseof-business records retention. In any event, beyond familiarization costs, the Board finds that the rule imposes only a de minimis additional cost for recordkeeping, and no comment presents empirical evidence to the contrary. d. Response to Comment Concerning Public Outreach The AFL–CIO argues that the Board failed to conduct sufficient outreach to small businesses, including small local 247 Comment of LIUNA MAROC. of Professor Kulwiec. 249 Comment of AFL–CIO. 248 Comment PO 00000 Frm 00031 Fmt 4701 Sfmt 4700 18395 unions, that will be impacted by the rule. Most of the issues addressed by this rule have been the subject of a robust public debate for several years. And in conjunction with the official publication of the NPRM, the Board worked to widely publicize the proposed rule. Upon issuance, the Board published the NPRM and facts sheets on its website. See NLRB, Election Protection Rule, https:// www.nlrb.gov/about-nlrb/what-we-do/ national-labor-relations-boardrulemaking/election-protection-rule (last visited Mar. 23, 2020). On August 9, 2019, the Board issued a press release, which was published on its website and distributed by email to subscribers, notifying the public of the proposed rule. See NLRB Office of Public Affairs, NLRB Proposes Rulemaking to Protect Employee Free Choice (Aug. 9, 2019) https://www.nlrb.gov/news-outreach/ news-story/nlrb-proposes-rulemakingprotect-employee-free-choice (last visited Mar. 23, 2020). The press release was also shared on social media through the Board’s official Twitter and Facebook accounts. The Board Members themselves have also discussed the proposed rule at various public speaking engagements, including the annual meeting of the Labor and Employment Law Section of the American Bar Association. Given the foregoing efforts and the many comments the Board received in response to the NPRM, we believe the public has been well informed, the pros and cons of the rule have been thoroughly examined, and the impact of the rule on the full range of small business entities governed by it have been brought into sharp focus by individuals, businesses, labor unions, and industry trade groups. 3. Response of the Agency to Any Comments Filed by the Chief Counsel for Advocacy of the Small Business Administration in Response to the Proposed Rule, and a Detailed Statement of any Change Made to the Proposed Rule in the Final Rule as a Result of the Comments The Chief Counsel of Advocacy of the Small Business Administration did not file any comments in response to the proposed rule. 4. Description of and an Estimate of the Number of Small Entities to Which the Rule Will Apply To evaluate the impact of the final rule, the Board first identified the universe of small entities that could be impacted by changes to the blockingcharge and voluntary-recognition-bar policies, as well as by elimination of the E:\FR\FM\01APR2.SGM 01APR2 18396 Federal Register / Vol. 85, No. 63 / Wednesday, April 1, 2020 / Rules and Regulations contract language basis for 8(f) to 9(a) conversion in the construction industry. jbell on DSKJLSW7X2PROD with RULES2 employees participate and which exist for the purpose . . . of dealing with employers concerning grievances, labor a. Blocking-Charge and Voluntarydisputes, wages, rates of pay, hours of Recognition-Bar Changes employment, or conditions of work.’’ 253 The changes to the blocking-charge The SBA’s ‘‘small business’’ standard and voluntary-recognition-bar policies for ‘‘Labor Unions and Similar Labor will apply to all entities covered by the Organizations’’ is $8 million in annual National Labor Relations Act (‘‘NLRA’’ receipts.254 In 2012, there were 13,740 or ‘‘the Act’’). According to the United labor unions in the U.S.255 Of these States Census Bureau, there were labor unions, 11,245 had receipts of less 5,954,684 businesses with employees in than $1,000,000; 2,022 labor unions had 2016.250 Of those, 5,934,985 were small receipts between $1,000,000 and businesses with fewer than 500 $4,999,999; and 141 had receipts employees.251 Although this final rule between $5,000,000 and $7,499,999. In would apply only to employers who aggregate, 13,408 labor unions (97.6% of meet the Board’s jurisdictional total) are small businesses according to requirements, the Board does not have SBA standards. the means to calculate the number of The blocking-charge policy change excluded entities (nor was data received will be applied as a matter of law only on this particular issue).252 Accordingly, under certain circumstances in a Board the Board assumes for purposes of this proceeding, namely, when a party to a analysis that the rule could impact the representation proceeding files an unfair great majority of the 5,934,985 small labor practice charge and requests a businesses. delay in the count of ballots or the These two changes will also impact certification of results after an election. all labor unions, as organizations Therefore, the frequency with which the representing or seeking to represent prior blocking-charge policy arose is employees. Labor unions, as defined by indicative of the number of small the NLRA, are entities ‘‘in which entities most directly impacted by the final rule. For example, in Fiscal Year 250 See U.S. Department of Commerce, Bureau of 2018, 1,408 petitions were filed and Census, 2016 Statistics of U.S. Businesses (SUSB) proceeded to an election, and only 4 of Annual Data Tables by Establishment Industry (Dec. those petitions were subject to a 2018), https://www.census.gov/data/tables/2016/ econ/susb/2016-susb-annual.html (from blocking charge. Thus, the current downloaded Excel Table titled ‘‘U.S., 6-digit blocking-charge policy directly NAICS’’). impacted 3.125% of petitions filed in 251 Id. The Census Bureau does not specifically Fiscal Year 2018, parties to which define ‘‘small business’’ but does break down its would only constitute a de minimis data into firms with fewer than 500 employees and those with 500 or more employees. Consequently, number of all small entities under the the 500-employee threshold is commonly used to Board’s jurisdiction. describe the universe of small employers. For Similarly, the number of small defining small businesses among specific entities expected to be most directly industries, the standards are defined by the North American Industry Classification System (NAICS). impacted by the modified voluntary 252 Pursuant to 29 U.S.C. 152(6) and (7), the Board recognition bar doctrine is also low. has statutory jurisdiction over private-sector When the modified voluntary employers whose activity in interstate commerce recognition bar was previously in effect, exceeds a minimal level. NLRB v. Fainblatt, 306 U.S. 601, 606–607 (1939). To this end, the Board the Board tracked the number of has adopted monetary standards for the assertion of requests for Dana notices, which were jurisdiction that are based on the volume and used to inform employees that a character of the business of the employer. In voluntary recognition had taken place general, the Board asserts jurisdiction over employers in the retail business industry if they and of their right to file a petition for an have a gross annual volume of business of $500,000 election. Those notices are similar to the or more. Carolina Supplies & Cement Co., 122 notices that would be required under NLRB 88 (1959). But shopping-center and officethis final rule. From September 29, building retailers have a lower threshold of $100,000 per year. Carol Management Corp., 133 2007, to May 13, 2011, the Board NLRB 1126 (1961). The Board asserts jurisdiction received 1,333 requests for Dana over non-retailers generally where the value of goods and services purchased from entities in other states is at least $50,000. Siemons Mailing Service, 122 NLRB 81 (1959). The following employers are excluded from the NLRB’s jurisdiction by statute: Federal, state and local governments, including public schools, libraries, and parks, Federal Reserve banks, and wholly-owned government corporations. 29 U.S.C. 152(2). Employers that employ only agricultural laborers, those engaged in farming operations that cultivate or harvest agricultural commodities or prepare commodities for delivery. 29 U.S.C. 152 (3). Employers subject to the Railway Labor Act, such as interstate railroads and airlines. 29 U.S.C. 152(2). VerDate Sep<11>2014 19:25 Mar 31, 2020 Jkt 250001 253 29 U.S.C. 152(5). 13 CFR 121.201. 255 The Census Bureau only provides data about receipts in years ending in 2 or 7. The 2017 data have not been published, so the 2012 data are the most recent available information regarding receipts. See U.S. Department of Commerce, Bureau of Census, 2012 SUSB Annual Data Tables by Establishment Industry, https://www2.census.gov/ programs-surveys/susb/tables/2012/us_6digitnaics_ r_2012.xlsx (Classification #813930—Labor Unions and Similar Labor Organizations) (last visited Mar. 23, 2020). 254 See PO 00000 Frm 00032 Fmt 4701 Sfmt 4700 notices, which is an average of 372 requests per year.256 Assuming each request was made by a distinct employer and involved at least one distinct labor organization, approximately 744 entities of various sizes were impacted each year that the modified voluntary-recognition bar was in effect.257 Thus, given our historic filing data, these numbers are very small relative to the number of small employers and unions subject to the NLRA and generally impacted by this change. Throughout the IRFA, the Board requested comments or data that might improve its analysis, 84 FR at 39954, 39957, but no additional data was received regarding the number of small entities and unions to which this change will apply. b. Elimination of Contract Language Basis for Proving Majority-Based Recognition in the Construction Industry The Board believes that the proposed elimination of the contract-language basis for proving majority-supported voluntary recognition is relevant only to construction-industry small employers and labor unions because Section 8(f) of the Act applies solely to such entities engaged in the building and construction industries. These construction-industry employers are classified under the NAICS Sector 23 Construction.258 Of the 640,951 256 Lamons Gasket, 357 NLRB at 742. Corp., 351 NLRB at 441–442 (establishing a 45-day ‘‘window period’’ after voluntary recognition during which employees could file an election petition supported by a 30percent showing of interest seeking decertification or representation by an alternative union). 258 These NAICS construction-industry classifications include the following codes: 236115: New Single-Family Housing Construction (except For-Sale Builders); 236116: New Multifamily Housing Construction (except For-Sale Builders); 236117: New Housing For-Sale Builders; 236118: Residential Remodelers; 236210: Industrial Building Construction; 236220: Commercial and Institutional Building Construction; 237110: Water and Sewer Line and Related Structures Construction; 237120: Oil and Gas Pipeline and Related Structures Construction; 237130: Power and Communication Line and Related Structures Construction; 237210: Land Subdivision; 237310: Highway, Street, and Bridge Construction; 237990: Other Heavy and Civil Engineering Construction; 238110: Poured Concrete Foundation and Structure Contractors; 238120: Structural Steel and Precast Concrete Contractors; 238130: Framing Contractors; 238140: Masonry Contractors; 238150: Glass and Glazing Contractors; 238160: Roofing Contractors; 238170: Siding Contractors; 238190: Other Foundation, Structure, and Building Exterior Contractors; 238210: Electrical Contractors and Other Wiring Installation Contractors; 238220: Plumbing, Heating, and Air-Conditioning Contractors; 238290: Other Building Equipment Contractors; 238310: Drywall and Insulation Contractors; 238320: Painting and Wall Covering Contractors; 238330: Flooring Contractors; 238340: 257 Dana E:\FR\FM\01APR2.SGM 01APR2 Federal Register / Vol. 85, No. 63 / Wednesday, April 1, 2020 / Rules and Regulations jbell on DSKJLSW7X2PROD with RULES2 employers included in those NAICS definitions, 633,135 are small employers that fall under the SBA ‘‘small business’’ standard for classifications in the NAICS Construction sector.259 In the NPRM, the Board identified 3,929 small labor unions primarily operating in the building and construction trades that fall under the SBA ‘‘small business’’ standard for the NAICS classification ‘‘Labor Unions and Similar Labor Organizations’’ of annual receipts of less than $7.5 million.260 In the IRFA, the Board requested comments or data that might improve its analysis regarding the number of construction-industry labor unions affected by the proposed rule, see 84 FR at 39955, but we did not receive any additional data regarding the number of small labor unions to which the rule will apply. It is unknown how many of those small construction-industry employers elect to enter into a 9(a) bargaining relationship with a small labor union based on language in a collectivebargaining agreement. However, again, the number of cases that involve a question of whether a relationship is governed by Section 8(f) or 9(a) is very small relative to the total number of construction-industry employers and unions. For example, only one case was filed in Fiscal Year 2017 where the Board ultimately had to determine whether a collective-bargaining agreement was governed by Section 8(f) or 9(a).261 In Fiscal Year 2016, no cases required the Board to determine whether a collective-bargaining agreement was governed by 8(f) or 9(a). One case was filed in Fiscal Year 2015 that came before the Board with the 8(f) or 9(a) collective-bargaining agreement issue.262 The historic filing data thus suggests that construction-industry employers and labor unions will only be most directly impacted in a small number of Tile and Terrazzo Contractors; 238350: Finish Carpentry Contractors; 238390: Other Building Finishing Contractors; 238910: Site Preparation Contractors; 238990: All Other Specialty Trade Contractors. See U.S. Department of Commerce, Bureau of Census, 2012 SUSB Annual Data Tables by Establishment Industry, https:// www2.census.gov/programs-surveys/susb/tables/ 2012/us_6digitnaics_r_2012.xlsx (last visited Mar. 23, 2020). 259 NAICS codes 236115–237130 and 237310– 237990 have a small-business threshold of $39.5 million in annual receipts; NAICS code 237210 has a threshold of $30 million in annual receipts; and NAICS codes 238110–238990 have a threshold of $16.5 million in annual receipts. See 13 CFR 121.201. 260 See 84 FR at 39955. 261 See AFP Specialties, Inc., Case 07–RD– 187706, 2017 WL 2212112, at *1 fn.1 (May 18, 2017). 262 See Loshaw Thermal Technology, LLC, Case 05–CA–158650, 2018 WL 4357198. VerDate Sep<11>2014 19:25 Mar 31, 2020 Jkt 250001 instances relative to the number of those types of small entities identified above. 5. Description of the Projected Reporting, Recordkeeping, and other Compliance Requirements of the Rule, Including an Estimate of the Classes of Small Entities Which will be Subject to the Requirement and the Type of Professional Skills Necessary for Preparation of the Report or Record The RFA requires agencies to consider the direct burden that compliance with a new regulation will likely impose on small entities.263 Thus, the RFA requires the Board to determine the amount of ‘‘reporting, recordkeeping and other compliance requirements’’ imposed on small entities. In providing its final regulatory flexibility analysis, an agency may provide either a quantifiable or numerical description of the effects of a rule or alternatives to the rule, or ‘‘more general descriptive statements if quantification is not practicable or reliable.’’ 264 We conclude that the final rule imposes no capital costs for equipment needed to meet the regulatory requirements; no lost sales and profits resulting from the proposed rule; no changes in market competition as a result of the proposed rule and its impact on small entities or specific submarkets of small entities; and no costs of hiring employees dedicated to compliance with regulatory requirements. Small entities may incur some costs from reviewing the rule in order to understand the substantive changes. To become generally familiar with the new vote-and-impound or vote-and-count procedures and the modified voluntaryrecognition bar, we estimate that a human-resources specialist at a small employer or labor union may take at most 90 minutes to read the rule. It is also possible that a small employer or labor union may wish to consult with an attorney, which we estimate will require 1 hour. Using the Bureau of Labor Statistics’ estimated wage and benefit costs, the Board has assessed these labor costs to be $164.51.265 The costs 263 See Mid-Tex Elec. Coop., Inc. v. FERC, 773 F.2d at 342 (‘‘[I]t is clear that Congress envisioned that the relevant ‘economic impact’ was the impact of compliance with the proposed rule on regulated small entities.’’). 264 See 5 U.S.C. 603(b)(4), 604(a)(4). 265 For wage figures, see May 2018 National Occupancy Employment and Wage Estimates, found at https://www.bls.gov/oes/current/oes_ nat.htm (last visited Mar. 23, 2020). The Board has been administratively informed that BLS estimates that fringe benefits are approximately equal to 40 percent of hourly wages. Thus, to calculate total average hourly earnings, BLS multiplies average hourly wages by 1.4. In May 2018, average hourly PO 00000 Frm 00033 Fmt 4701 Sfmt 4700 18397 associated with the portion of the rule that eliminates the contract-language basis for establishing voluntary recognition under Section 9(a) are limited to small employers and unions in the construction industry. To become generally familiar with that change, in addition to the first two changes, we estimate that a human-resources specialist at a small employer or union in the construction industry may take at most 2 hours to read the entire rule. Consultation with an attorney may take an additional 15 minutes, or 75 minutes to consult with an attorney regarding the entire rule. Thus, the Board has assessed labor costs for small employers and unions in the construction industry to be $211.25. a. Costs Associated With Establishment of Vote and Impound or Vote-and-Count Procedures Although we do not foresee any additional compliance costs related to eliminating the blocking-charge policy, this policy change would cause some elections to occur sooner, and in some cases would lead to elections that previously would not have occurred. Arguably, the time compression of holding an election under the Board’s typical election timeline may create additional costs for small businesses that do not have in-house legal departments or ready access to outside labor attorneys or consultants, and that consequently need to pay to obtain such assistance. Conversely, because the Board’s current blocking-charge policy appears susceptible to manipulation and abuse, the elimination of that policy may result in fewer unfair labor practice charges filed with the intent to forestall employees from exercising their right to vote. This would reduce some costs for small employers by eliminating the need to hire a labor attorney to defend against such charges. It could also create additional costs for small labor unions that have to prepare for an election that may have otherwise been postponed or that may subsequently be set aside. In the IRFA, the Board requested comments or data that might improve its analysis regarding the estimated cost for preparing and participating in elections, see 84 FR at 39956, but—other than the AFL–CIO’s comment referenced above— we received no additional data regarding the average cost for preparing for or participating in a Board election. wages for a Human Resources Specialist (BLS #13– 1071) were $32.11. The same figure for a lawyer (BLS #23–1011) was $69.34. Accordingly, the Board multiplied each of those wage figures by 1.4 and added them to arrive at its estimate. In the IRFA, we estimated these costs using May 2017 National Occupancy Employment and Wage Estimates. E:\FR\FM\01APR2.SGM 01APR2 18398 Federal Register / Vol. 85, No. 63 / Wednesday, April 1, 2020 / Rules and Regulations The Board believes that any costs from participating in quicker elections or elections that would have not otherwise occurred are limited to very few employers, comparing the limited number of Board proceedings where an unfair labor practice charge has been filed contemporaneously with an election petition with the high number of employers that are subject to the Board’s jurisdiction. jbell on DSKJLSW7X2PROD with RULES2 b. Costs Associated With Modification of the Voluntary-Recognition Bar In a case in which an employer voluntarily recognizes a union, we estimate that the employer will spend an estimated 1 hour and 45 minutes to comply with the rule. This includes: 30 minutes for the employer (or union) to notify the local regional office of the Board in writing of the grant of voluntary recognition by submitting a copy of the recognition agreement; 60 minutes to open the notice sent from the Board, insert certain information specific to the parties to the voluntary recognition, post the notice physically and electronically (depending on where and how the employer customarily posts notices to employees), and distribute it electronically (if the employer customarily communicates with employees electronically); and 15 minutes to complete the certification-ofposting form to be returned to the Region at the close of the notice-posting period. We assume that these activities will be performed by a human-resources specialist for a total cost of about $78.66. The Board’s modified voluntaryrecognition bar will cause elections to be held in a small number of cases in which the election petition previously would have been dismissed, increasing costs for both employers and unions. As stated previously, in the IRFA, the Board requested comments or data that might improve its analysis regarding the estimated cost for preparing for and participating in elections, including those after a grant of voluntary recognition, see 84 FR at 39956, but we received no additional data, other than the AFL–CIO’s comment referenced above. c. Costs Associated With Elimination of Contract-Language Basis for Proving Majority-Based Recognition in the Construction Industry Under current Board law, a construction-industry employer and union can write into their collectivebargaining agreement that the union showed or offered to show evidence of majority support and, in combination with certain other contractual language, VerDate Sep<11>2014 20:02 Mar 31, 2020 Jkt 250001 have the bargaining relationship be governed under Section 9(a) as opposed to a presumed 8(f) bargaining relationship. As described above, the final rule eliminates the contractlanguage basis for establishing a 9(a) bargaining relationship and thereby barring a petition in a representation proceeding. However, the rule continues to allow two other methods to establish a 9(a) bargaining relationship: a Boardcertified election and voluntary recognition based on demonstrated majority support. In the handful of cases where an election petition is filed involving one of the approximately 6 million small entities in the United States, both the construction industry employer and labor union would incur the cost of participating in an election. As noted above, we are unable to quantify the cost of preparing for or participating in a Board election. In cases where a construction-industry employer voluntarily recognizes a union based on demonstrated majority support, the union may incur an additional de minimis cost related to the retention of the evidence of majority support, e.g., signed union authorization cards, for a longer period of time if it can no longer rely on contractual language. No data or comments were received relating to such costs, other than those comments described above. d. Overall Costs We do not find the estimated $164.51 cost to small employers and unions in order to review and understand the petition-processing procedures and the modified voluntary recognition bar, or the estimated $78.66 cost for an employer to comply with the notice requirements of the modified recognition bar, to be significant within the meaning of the RFA. We find the same with regard to the estimated cost of $211.25 for small employers and unions in the construction industry to review and understand the elimination of the contract-language basis for establishing voluntary recognition under Section 9(a), in addition to the first two changes. In making these findings, one important indicator is the cost of compliance in relation to the revenue of the entity or the percentage of profits affected. Other criteria to be considered are the following: —Whether the rule will cause long-term insolvency, i.e., regulatory costs that may reduce the ability of the firm to make future capital investment, thereby severely harming its competitive ability, particularly against larger firms; —Whether the cost of the proposed regulation will (a) eliminate more PO 00000 Frm 00034 Fmt 4701 Sfmt 4700 than 10 percent of the businesses’ profits; (b) exceed one percent of the gross revenues of the entities in a particular sector, or (c) exceed five percent of the labor costs of the entities in the sector. The minimal cost to read and understand the rule, $164.51 or $211.25, will not generate any such significant economic impacts, nor will the minimal cost, $289.91 for employers to comply with the modified recognition-bar notice posting. 6. Description of the Steps the Agency Has Taken To Minimize the Significant Economic Impact on Small Entities Consistent With the Stated Objectives of Applicable Statutes, Including a Statement of the Factual, Policy, and Legal Reasons for Selecting the Alternative Adopted in the Final Rule and Why Each one of the Other Significant Alternatives to the Rule Considered by the Agency Which Affect the Impact on Small Entities was Rejected Pursuant to 5 U.S.C. 604(a)(6), agencies are directed to examine ‘‘why each one of the other significant alternatives to the rule considered by the agency which affect the impact on small entities was rejected.’’ In the IRFA, the Board requested comments identifying any other issues and alternatives that it had not considered. See 84 FR at 39957. Many comments suggested that the Board withdraw the proposed rule and leave in place the current blockingcharge policy, voluntary-recognition bar, and requirement of proof to show majority-based recognition in the construction industry. We considered and rejected these alternatives for the reasons stated above. Consequently, we reject maintaining the status quo. The AFL–CIO suggests several alternatives to the proposed modification to the blocking-charge policy, including expedited investigation of possible blocking charges, periodic review of charges that are blocking an election, instructing regional directors to make fuller use of their existing discretion to not block elections, expanding exceptions in the blocking-charge policy, or limiting the application of the new rule to charges not filed by the petitioner.266 We have discussed, and rejected, these alternatives for the reasons discussed in Section III.E. above. 266 CWA similarly stresses the existing discretion afforded to regional directors as to whether to process a petition and conduct an election if a charge and request to block an election has been filed. E:\FR\FM\01APR2.SGM 01APR2 Federal Register / Vol. 85, No. 63 / Wednesday, April 1, 2020 / Rules and Regulations In the NPRM, the Board considered exempting certain small entities. See 84 FR at 39957. We received no comments on this potential alternative and again reject this exemption as impractical because such a large percentage of employers and unions would be exempt under the SBA definitions, thereby substantially undermining the purpose of the final rule. Additionally, given the very small quantifiable cost of compliance, it is possible that the burden on a small business of determining whether it fell within a particular exempt category might exceed the burden of compliance. Congress gave the Board very broad jurisdiction, with no suggestion that it wanted to limit coverage of any part of the Act to only larger employers. As the Supreme Court has noted, ‘‘[t]he [NLRA] is federal legislation, administered by a national agency, intended to solve a national problem on a national scale.’’ NLRB v. Hearst Publ’ns, 322 U.S. 111, 123 (1944). As such, this alternative is contrary to the objectives of this rulemaking and of the NLRA. None of the alternatives considered would adequately accomplish the primary objective of issuing this rule— protection of employee free choice— while minimizing costs on small businesses. Accordingly, we believe that promulgating this final rule is the best regulatory course of action. B. Paperwork Reduction Act In the NPRM, the Board explained that the proposed rule would not impose any information-collection requirements and accordingly, the proposed rule is not subject to the Paperwork Reduction Act (PRA), 44 U.S.C. 3501 et seq. See 84 FR at 39957. We have not received any substantive comments relevant to the Board’s analysis of its obligations under the PRA. jbell on DSKJLSW7X2PROD with RULES2 C. Congressional Review Act The three provisions of the final rule are substantive, and the Board will submit this rule and required accompanying information to the Senate, the House of Representatives, and the Comptroller General as required by the Small Business Regulatory Enforcement Fairness Act, Subtitle E (the Congressional Review Act or CRA), 5 U.S.C. 801–808. Pursuant to the Congressional Review Act, the Office of Information and Regulatory Affairs designated this rule as a major rule. Accordingly, the rule will become effective June 1, 2020. VerDate Sep<11>2014 19:25 Mar 31, 2020 Jkt 250001 VI. Final Rule For the reasons set forth in the preamble, the National Labor Relations Board amends part 103 of title 29 of the Code of Federal Regulations as follows. List of Subjects in 29 CFR Part 103 Jurisdictional standards, Election procedures, Appropriate bargaining units, Joint Employers, Remedial Orders. PART 103—OTHER RULES 1. The authority citation for part 103 continues to read: ■ Authority: 29 U.S.C. 156, in accordance with the procedure set forth in 5 U.S.C. 553. ■ 2. Revise § 103.20 to read as follows: § 103.20 Election procedures and blocking charges. (a) Whenever any party to a representation proceeding files an unfair labor practice charge together with a request that the charge block the election process, or whenever any party to a representation proceeding requests that its previously filed unfair labor practice charge block the election process, the party shall simultaneously file, but not serve on any other party, a written offer of proof in support of the charge. The offer of proof shall provide the names of the witnesses who will testify in support of the charge and a summary of each witness’s anticipated testimony. The party seeking to block the election process shall also promptly make available to the regional director the witnesses identified in its offer of proof. (b) If charges are filed alleging violations other than those described in paragraph (c) of this section, the ballots will be promptly opened and counted at the conclusion of the election. (c) If charges are filed that allege violations of section 8(a)(1) and 8(a)(2) or section 8(b)(1)(A) of the Act and that challenge the circumstances surrounding the petition or the showing of interest submitted in support of the petition, or a charge is filed that alleges an employer has dominated a union in violation of section 8(a)(2) and seeks to disestablish a bargaining relationship, the regional director shall impound the ballots for up to 60 days from the conclusion of the election if the charge has not been withdrawn or dismissed prior to the conclusion of the election. If a complaint issues with respect to the charge at any point prior to expiration of that 60-day post-election period, then the ballots shall continue to be impounded until there is a final determination regarding the charge and PO 00000 Frm 00035 Fmt 4701 Sfmt 4700 18399 its effect, if any, on the election petition. If the charge is withdrawn or dismissed at any time during that 60-day period, or if the 60-day period ends without a complaint issuing, then the ballots shall be promptly opened and counted. The 60-day period will not be extended, even if more than one unfair labor practice charge is filed serially. (d) For all charges described in paragraphs (b) or (c) of this section, the certification of results (including, where appropriate, a certification of representative) shall not issue until there is a final disposition of the charge and a determination of its effect, if any, on the election petition. ■ 3. Add § 103.21 to read as follows: § 103.21 Processing of petitions filed after voluntary recognition. (a) An employer’s voluntary recognition of a labor organization as exclusive bargaining representative of an appropriate unit of the employer’s employees under section 9(a) of the Act, and the first collective-bargaining agreement executed by the parties on or after the date of such voluntary recognition, will not bar the processing of an election petition unless: (1) The employer and/or the labor organization notifies the Regional Office that recognition has been granted; (2) The employer posts, in conspicuous places, including all places where notices to employees are customarily posted, a notice of recognition (provided by the Regional Office) informing employees that recognition has been granted and that they have a right to file a petition during a 45-day ‘‘window period’’ beginning on the date the notice is posted; (3) The employer distributes the notice described in paragraph (a)(2) of this section electronically to employees in the petitioned-for unit, if the employer customarily communicates with its employees electronically; and (4) 45 days from the posting date pass without a properly supported petition being filed. (5) The notice described in paragraph (a)(2) of this section shall state as follows: Federal law gives employees the right to form, join, or assist a union and to choose not to engage in these protected activities. An employer may lawfully recognize a union based on evidence (such as signed authorization cards) indicating that a majority of employees in an appropriate bargaining unit desire its representation, without an election supervised by the National Labor Relations Board. Once an employer recognizes a union as the employees’ exclusive bargaining representative, the employer has an obligation to bargain with the union in good E:\FR\FM\01APR2.SGM 01APR2 18400 Federal Register / Vol. 85, No. 63 / Wednesday, April 1, 2020 / Rules and Regulations jbell on DSKJLSW7X2PROD with RULES2 faith in an attempt to reach a collectivebargaining agreement, and that obligation is not delayed or otherwise impacted by this notice. The National Labor Relations Board is an agency of the United States Government and does not endorse any choice about whether employees should keep the recognized union, file a petition to certify the recognized union, file a petition to decertify the recognized union, or support or oppose a representation petition filed by another union. [Employer] on [date] recognized [Union] as the employees’ exclusive bargaining representative based on evidence indicating that a majority of employees in [described bargaining unit] desire its representation. All employees, including those who previously signed cards in support of [Union], have the right to be represented by a union of their choice or by no union at all. Within 45 days from the date of this notice, a petition supported by 30 percent or more of the unit employees may be filed with the National Labor Relations Board for a secretballot election to determine whether or not the unit employees wish to be represented by [Union], or 30 percent or more of the unit employees can support another union’s filing of a petition to represent them. Any properly supported petition filed within the 45-day window period will be VerDate Sep<11>2014 19:25 Mar 31, 2020 Jkt 250001 processed according to the National Labor Relations Board’s normal procedures. A petition may be filed within the 45-day window period even if [Employer] and [Union] have already reached a collectivebargaining agreement. If no petition is filed within the 45-day window period, the Union’s status as the unit employees’ exclusive bargaining representative will be insulated from challenge for a reasonable period of time, and if [Employer] and [Union] reach a collectivebargaining agreement during that insulated reasonable period, an election cannot be held for the duration of that collective-bargaining agreement, up to 3 years. (b) This section shall be applicable to an employer’s voluntary recognition on or after the effective date of this rule. ■ 4. Add § 103.22 to read as follows: § 103.22 Proof of majority-based bargaining relationship between employer and labor organization in the construction industry. (a) A voluntary recognition or collective-bargaining agreement between an employer primarily engaged in the building and construction industry and a labor organization will not bar any election petition filed PO 00000 Frm 00036 Fmt 4701 Sfmt 9990 pursuant to section 9(c) or 9(e) of the Act absent positive evidence that the union unequivocally demanded recognition as the section 9(a) exclusive bargaining representative of employees in an appropriate bargaining unit, and that the employer unequivocally accepted it as such, based on a contemporaneous showing of support from a majority of employees in an appropriate unit. Collective-bargaining agreement language, standing alone, will not be sufficient to provide the showing of majority support. (b) This section shall be applicable to an employer’s voluntary recognition extended on or after the effective date of this rule and to any collectivebargaining agreement entered into on or after the date of voluntary recognition extended on or after the effective date of this rule. Dated: March 24, 2020. Roxanne L. Rothschild, Executive Secretary. [FR Doc. 2020–06470 Filed 3–31–20; 8:45 am] BILLING CODE 7545–01–P E:\FR\FM\01APR2.SGM 01APR2

Agencies

[Federal Register Volume 85, Number 63 (Wednesday, April 1, 2020)]
[Rules and Regulations]
[Pages 18366-18400]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-06470]



[[Page 18365]]

Vol. 85

Wednesday,

No. 63

April 1, 2020

Part III





National Labor Relations Board





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29 CFR Part 103





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Representation--Case Procedures: Election Bars; Proof of Majority 
Support in Construction-Industry Collective-Bargaining Relationships; 
Final Rule

Federal Register / Vol. 85 , No. 63 / Wednesday, April 1, 2020 / 
Rules and Regulations

[[Page 18366]]


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NATIONAL LABOR RELATIONS BOARD

29 CFR Part 103

RIN 3142-AA16


Representation--Case Procedures: Election Bars; Proof of Majority 
Support in Construction-Industry Collective-Bargaining Relationships

AGENCY: National Labor Relations Board.

ACTION: Final rule.

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SUMMARY: As part of ongoing efforts to more effectively administer the 
National Labor Relations Act (the Act or the NLRA) and to further the 
purposes of the Act, the National Labor Relations Board (the Board or 
the NLRB) hereby makes three amendments to its rules and regulations 
governing the filing and processing of petitions for a Board-conducted 
representation election and proof of majority support in construction-
industry collective-bargaining relationships. The amendments effect 
changes in current procedures that have not previously been 
incorporated in the Board's rules. The Board believes that the 
amendments made in this final rule will better protect employees' 
statutory right of free choice on questions concerning representation 
by removing unnecessary barriers to the fair and expeditious resolution 
of such questions through the preferred means of a Board-conducted 
secret-ballot election.

DATES: This rule will be effective on June 1, 2020.

FOR FURTHER INFORMATION CONTACT: Roxanne L. Rothschild, Executive 
Secretary, National Labor Relations Board, 1015 Half Street SE, 
Washington, DC 20570-0001, (202) 273-1940 (this is not a toll-free 
number), 1-866-315-6572 (TTY/TDD).

SUPPLEMENTARY INFORMATION: 

I. Background

A. The Act

    The NLRA sets forth a number of rights and responsibilities that 
apply to employers, employees, and labor organizations representing 
employees, in furtherance of the Act's overarching goals of protecting 
employees' right to designate or select ``representatives of their own 
choosing,'' or to refrain from doing so; \1\ ensuring that, except in 
situations covered by Section 8(f) of the Act, exclusive 
representatives are ``designated or selected for the purposes of 
collective bargaining by the majority of employees'' in an appropriate 
bargaining unit; \2\ and promoting labor-relations stability.\3\ As 
discussed further below, Section 8(f) allows ``an employer engaged 
primarily in the building and construction industry to make an 
agreement covering'' certain employees ``with a labor organization of 
which building and construction employees are members,'' even if it has 
not been established that the labor organization represents a majority 
of the employees that it represents.\4\ In addition, while it is well 
established that the Act permits voluntary recognition of labor 
organizations, the Act also requires the Board--when the necessary 
prerequisites are met--to direct and conduct secret-ballot elections 
and certify the results thereof.\5\
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    \1\ Sec. 7 of the Act, 29 U.S.C. 157.
    \2\ Sec. 9(a) of the Act, 29 U.S.C. 159(a).
    \3\ Sec. 1 of the Act, 29 U.S.C. 151.
    \4\ Sec. 8(f) of the Act, 29 U.S.C. 158(f).
    \5\ Sec. 9(c)(1)(B) of the Act, 29 U.S.C. 159(c)(1)(B); Sec. 
9(e) of the Act, 29 U.S.C. 159(e).
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B. Notice of Proposed Rulemaking (NPRM)

    On August 12, 2019, the Board issued the NPRM. The Board set an 
initial comment period of 60 days, with 14 additional days allotted for 
reply comments. Thereafter, the Board extended these deadlines twice: 
First for 60 days, and then for an additional 30 days. Various aspects 
of the NPRM are summarized below.
1. Summary of the Proposed Rule
    In the NPRM, the Board proposed to make three amendments to its 
current practices. The first amendment, Sec.  103.20, proposed to 
modify the Board's current practices that permit a party to block an 
election based on pending unfair labor practice charges. The proposed 
amendment provided that a blocking charge would not delay the conduct 
of the election and that the ballots would be impounded until there is 
a final determination regarding the charge and its effect, if any, on 
the election petition or the fairness of the election.
    The second amendment, Sec.  103.21(a), proposed to modify the 
Board's existing procedures providing for an immediate election bar 
following an employer's voluntary recognition of a union as the 
majority-supported collective-bargaining representative of the 
employer's employees. The proposed amendment provided for a post-
recognition open period of 45 days within which election petitions 
could be filed and processed.
    The third amendment, Sec.  103.22(b), proposed to redefine the 
evidence required to prove that an employer and a labor organization in 
the construction industry have established a voluntary majority-
supported collective-bargaining relationship that could bar an 
election. Under the Board's current practice, certain contract 
language, standing alone, is sufficient to prove such a relationship. 
The proposed amendment would require positive evidence that the union 
unequivocally demanded recognition as the majority-supported exclusive 
bargaining representative of employees in an appropriate bargaining 
unit, and that the employer unequivocally accepted it as such, based on 
a contemporaneous showing of support from a majority of employees in an 
appropriate unit.
2. Reasons for Rulemaking
    In the NPRM, the Board acknowledged that it historically has made 
most substantive policy determinations through case adjudication, but 
stated that it interpreted section 6 of the Act, 29 U.S.C. 156, as 
authorizing the Board to engage in this informal notice-and-comment 
rulemaking. In addition, the Board found that using such rulemaking in 
this context was desirable because (1) it would enable the Board to 
solicit broad public comment on, and to address in a single proceeding, 
three related election-bar issues that would not likely arise in the 
adjudication of a single case; (2) rulemaking does not depend on the 
participation and argument of parties in a specific case, and it cannot 
be mooted by developments in a pending case; and (3) by establishing 
the new standards in its Rules and Regulations, the Board would enable 
employers, unions, and employees to plan their affairs free from the 
uncertainty that the legal regime may change on a moment's notice (and 
possibly retroactively) through the adjudication process.
3. Reasons for Proposed Changes to Blocking-Charge Policy
    As discussed in greater detail in the NPRM, through adjudication 
the Board created the blocking-charge policy, which permits a party to 
block an election indefinitely by filing unfair labor practice charges 
that allegedly create doubt as to the validity of an election petition 
or the ability of employees to make a free and fair choice concerning 
representation while the charges remain unresolved. This policy can 
preclude holding the petitioned-for election for months or even years, 
if at all. See, e.g., Cablevision Systems Corp., Case 29-RD-138839, 
https://www.nlrb.gov/case/29-RD-138839 (as

[[Page 18367]]

noted by Cablevision Systems Corp., 367 NLRB No. 59 (2018), blocking 
charge followed by regional director's misapplication of settlement-bar 
doctrine delayed processing until December 19, 2018, of valid 
decertification (RD) petition filed on October 16, 2014; employee 
petitioner thereafter withdrew petition).
    As the Board noted, and as discussed further in Section III.E. 
below, courts of appeals have criticized the blocking-charge policy's 
adverse impacts on employee RD petitions, as well as the potential for 
abuse and manipulation of that policy by incumbent unions seeking to 
avoid a challenge to their representative status. See NLRB v. Hart 
Beverage Co., 445 F.2d 415, 420 (8th Cir. 1971); Templeton v. Dixie 
Color Printing Co., 444 F.2d 1064, 1069 (5th Cir. 1971); NLRB v. 
Midtown Serv. Co., 425 F.2d 665, 672 (2d Cir. 1970); NLRB v. Minute 
Maid Corp., 283 F.2d 705, 710 (5th Cir. 1960); Pacemaker Corp. v. NLRB, 
260 F.2d 880, 882 (7th Cir. 1958).
    The potential for delay is the same when employees, instead of 
filing an RD petition, have otherwise expressed to their employer a 
desire to decertify an incumbent union representative. In that 
circumstance, the blocking-charge policy can prevent the employer from 
being able to seek a timely Board-conducted election to resolve the 
question concerning representation raised by evidence of good-faith 
uncertainty as to the union's continuing majority support. Thus, the 
supposed ``safe harbor'' of filing an employer (RM) petition that the 
Board majority referenced in Levitz Furniture Co. of the Pacific, 333 
NLRB 717, 726 (2001), as an alternative to the option of withdrawing 
recognition (which the employer selects at its peril) is often 
illusory.
    Additionally, concerns have been raised about the Board's regional 
directors not applying the blocking-charge policy consistently, thereby 
creating uncertainty and confusion about when, if ever, parties can 
expect an election to occur. See Zev J. Eigen & Sandro Garofalo, Less 
Is More: A Case for Structural Reform of the National Labor Relations 
Board, 98 Minn. L. Rev. 1879, 1896-1897 (2014).
    The Board stated that it was inclined to believe, subject to 
comments, that the blocking-charge policy impedes, rather than 
protects, employee free choice. In a significant number of cases, the 
policy denies employees the right to have their votes, in a Board-
conducted election on questions concerning representation, ``recorded 
accurately, efficiently and speedily.'' NLRB v. A.J. Tower Co., 329 
U.S. 324, 331 (1946). Unnecessary delay robs an election-petition 
effort of momentum, and many of the employees ultimately voting on the 
issue of representation may not even be the same as those who were in 
the workforce when the petition was filed. Additionally, the Board 
stated, the blocking-charge policy rests on a presumption that even an 
unlitigated and unproven allegation of any one of a broad range of 
unfair labor practices justifies indefinite delay because of a 
discretionary administrative determination regarding the potential 
impact of the alleged misconduct on employees' ability to cast a free 
and uncoerced vote on the question of representation. Moreover, the 
current policy of holding petitions in abeyance for certain pre-
petition ``Type I'' blocking charges \6\ ``represents an anomalous 
situation in which some conduct that would not be found to interfere 
with employee free choice if alleged in objections [to an election], 
because it occurs outside the critical election period, would 
nevertheless be the basis for substantially delaying holding any 
election at all.'' Representation--Case Procedures, 79 FR 74308, 74456 
(Dec. 15, 2014) (2015 Election Rule) (Dissenting Views of Members 
Miscimarra and Johnson) (citing Ideal Electric Mfg. Co., 134 NLRB 1275 
(1961)).
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    \6\ Type I blocking charges are charges that allege conduct that 
interferes with employee free choice (but does not call into 
question the validity of the election petition itself). See NLRB 
Casehandling Manual (Part Two) Representation Proceedings Sec. 
11730.2 (Jan. 2017).
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    For these reasons, in the NPRM the Board proposed, subject to 
comments, to eliminate the current blocking-charge policy and to adopt 
a ``vote-and-impound'' procedure. Under that proposed procedure, 
regional directors would continue to process a representation petition 
and would conduct an election even when an unfair labor practice charge 
and blocking request have been filed. If the charge has not been 
resolved prior to the election, the Board proposed, the ballots would 
remain impounded until the Board makes a final determination regarding 
the charge.\7\
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    \7\ We note that nothing in the proposed rule purported to alter 
the existing requirements in 29 CFR 103.20 that only a party to the 
representation proceeding may file the request to block the election 
process; only unfair labor practice charges filed by that party may 
be the subject of a request to block; that party must file a written 
offer of proof as well as the names of witnesses who will testify in 
support of the charge and a summary of each witness's anticipated 
testimony; and that party must promptly make available to the 
regional director the witnesses identified in the offer of proof. As 
noted further below, the final rule also does not affect any of 
those existing requirements.
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4. Reasons for Proposed Changes to Voluntary-Recognition Bar
    As discussed in greater detail in the NPRM, employers may 
voluntarily recognize unions based on a union's showing of majority 
support; a Board election is not required. NLRB v. Gissel Packing Co., 
395 U.S. 575, 595-600 (1969); United Mine Workers of America v. 
Arkansas Oak Flooring Co., 351 U.S. 62, 72 fn. 8 (1956). Over time, the 
Board developed a rule that an employer's voluntary recognition of a 
union would immediately bar the filing of an election petition for a 
reasonable period of time following recognition. See Sound Contractors 
Assn., 162 NLRB 364 (1966). Then, if the parties reached a collective-
bargaining agreement during that reasonable period, the Board's 
contract-bar doctrine would continue to bar election petitions for the 
duration of the agreement, up to a maximum limit of 3 years. See 
General Cable Corp., 139 NLRB 1123, 1125 (1962).
    In Dana Corp., 351 NLRB 434 (2007), a Board majority found that the 
existing immediate voluntary-recognition-bar policy ``should be 
modified to provide greater protection for employees' statutory right 
of free choice and to give proper effect to the court- and Board-
recognized statutory preference for resolving questions concerning 
representation through a Board secret-ballot election.'' Id. at 437. 
Thus, the Dana majority held that voluntary recognition would not bar 
an election unless (a) affected bargaining-unit employees receive 
adequate notice of the recognition and of their opportunity to file a 
Board election petition within 45 days, and (b) 45 days pass from the 
date of notice without the filing of a validly supported petition. Id. 
at 441. The Board further stated that, ``if the notice and window-
period requirements have not been met, any postrecognition contract 
will not bar an election.'' Id.
    Then, in Lamons Gasket Co., 357 NLRB 739 (2011), a new Board 
majority overruled Dana Corp. and reinstated the immediate voluntary-
recognition election bar. Additionally, the Board defined the 
reasonable period of time during which a voluntary recognition would 
bar an election as no less than 6 months after the date of the parties' 
first bargaining session and no more than 1 year after that date. Id. 
at 748.
    As the NPRM noted, ``[a]t least since Lamons Gasket, the imposition 
of the immediate recognition bar, followed by the execution of a 
collective-bargaining agreement, can preclude the possibility of 
conducting a Board election contesting the initial non-electoral 
recognition of a union as a majority-

[[Page 18368]]

supported exclusive bargaining representative for as many as four 
years.'' 84 FR at 39934 (August 12, 2019). In response to a 2017 Board 
Request for Information, some respondents contended that the Board 
should eliminate the voluntary-recognition bar or, in the alternative, 
should reinstate the Dana notice and open-period requirements.
    In the NPRM, the Board proposed, subject to comments, to overrule 
Lamons Gasket and to reinstate the Dana notice and open-period 
procedures following voluntary recognition under Section 9(a). In this 
connection, the Board cited the justifications set forth by the Dana 
Board majority and the dissenting Member in Lamons Gasket. As the Board 
stated, while voluntary recognition is undisputedly lawful, secret-
ballot elections are the preferred method of ascertaining whether a 
union has majority-employee support. See NLRB v. Gissel Packing Co., 
395 U.S. at 602. The Board further noted that, in conjunction with the 
contract bar, an immediate recognition bar could deny employees an 
initial opportunity to vote in a secret-ballot Board election for as 
many as 4 years--or even longer, because the reasonable period for 
bargaining runs from the date of the first bargaining session, which, 
to be lawful, must come after voluntary recognition.
    The Board also stated that the Board election statistics cited in 
Lamons Gasket supported, rather than detracted from, the need for a 
notice and brief open period following voluntary recognition. In this 
connection, quoting the Lamons Gasket dissent, the Board stated that 
the statistics showed that (1) Dana served the intended purpose of 
assuring employee free choice in those cases where the choice made in 
the preferred Board electoral process contradicted the showing on which 
voluntary recognition was granted; (2) in those cases where the 
recognized union's majority status was affirmed in a Dana election, the 
union gained the additional benefits of Section 9(a) certification, 
including a 1-year bar to further electoral challenge; (3) there was no 
substantial evidence that Dana had any discernible impact on the number 
of union voluntary-recognition campaigns, or on the success rate of 
such campaigns; and (4) there was no substantial evidence that Dana had 
any discernible impact on the negotiation of bargaining agreements 
during the open period or on the rate at which agreements were reached 
after voluntary recognition.
    Thus, the Board concluded, subject to comments, that it was 
necessary and appropriate to modify the Board's current recognition-bar 
policy--not currently set forth in the rules and regulations--by 
reestablishing a notice requirement and 45-day open period for filing 
an election petition following an employer's voluntary recognition of a 
labor organization as employees' majority-supported exclusive 
collective-bargaining representative under Section 9(a) of the Act. 
Along with the other changes in this rule, the Board stated that it 
believed, subject to comments, that the immediate imposition of a 
voluntary-recognition bar is an overbroad and inappropriate limitation 
on the employees' ability to exercise their fundamental statutory right 
to the timely resolution of questions concerning representation through 
the preferred means of a Board-conducted election.
5. Reasons for Proposed Changes to Policy Regarding Proof of Majority-
Based Recognition Under Section 9(a) in the Construction Industry
    As discussed in greater detail in the NPRM, based on the unique 
characteristics of the construction industry, Congress created an 
exception to the majoritarian principles that govern collective-
bargaining relationships in other industries. Thus, as noted above, 
Section 8(f) of the Act permits a construction-industry employer and 
labor organization to establish a collective-bargaining relationship in 
the absence of support from a majority of employees. However, unlike 
collective-bargaining relationships governed by Section 9(a), the 
second proviso to Section 8(f) provides that any agreement that is 
lawful only because of 8(f)'s nonmajority exception cannot bar a 
petition for a Board election. Accordingly, there cannot be a contract 
bar or a voluntary-recognition bar to an election among employees 
covered by an 8(f) agreement.
    As recounted in the NPRM, the Board has used various tests over the 
years to determine whether a bargaining relationship or collective-
bargaining agreement in the construction industry is governed by 
Section 9(a) majoritarian principles or by Section 8(f) and its 
exceptions to those principles. Beginning in 1971, the Board adopted a 
``conversion doctrine'' under which a bargaining relationship initially 
established under Section 8(f) could convert into a 9(a) relationship 
by means other than a Board election or a majority-based voluntary 
recognition. See Ruttmann Construction, 191 NLRB 701 (1971); R. J. 
Smith Construction Co., 191 NLRB 693 (1971), enf. denied sub nom. 
Operating Engineers Local 150 v. NLRB, 480 F.2d 1186 (DC Cir. 1973). 
Conversion to a 9(a) relationship and agreement would occur if the 
union could show that it had achieved the support of a majority of 
bargaining-unit employees during a contract term. However, as the Board 
later recognized, ``[t]he achievement of majority support required no 
notice, no simultaneous union claim of majority, and no assent by the 
employer to complete the conversion process''; rather, ``the presence 
of an enforced union-security clause, actual union membership of a 
majority of unit employees, as well as referrals from an exclusive 
hiring hall'' were sufficient proof to trigger conversion. John Deklewa 
& Sons, 282 NLRB 1375, 1378 (1987), enfd. sub nom. Iron Workers Local 3 
v. NLRB, 843 F.2d 770 (3d Cir. 1988), cert. denied 488 U.S. 889 (1988).
    In John Deklewa & Sons, the Board repudiated the conversion 
doctrine as inconsistent with statutory policy and congressional intent 
expressed through Section 8(f)'s second proviso. Id. at 1382. According 
to the Board in Deklewa, conversion of an 8(f) agreement into a 9(a) 
agreement raises ``an absolute bar to employees' efforts to reject or 
to change their collective-bargaining representative,'' contrary to the 
second proviso of Section 8(f). Id. In addition, the Board adopted a 
presumption that construction-industry contracts are governed by 
Section 8(f), so that ``the party asserting the existence of a 9(a) 
relationship'' bears the burden of proving it. Id. at 1385 fn. 41. 
Noting, however, that ``nothing in [its] opinion [was] meant to suggest 
that unions have less favored status with respect to construction[-
]industry employers,'' the Board also affirmed that a union could 
achieve 9(a) status through ``voluntary recognition accorded . . . by 
the employer of a stable workforce where that recognition is based on a 
clear showing of majority support among the unit employees, e.g., a 
valid card majority.'' Id. at 1387 fn. 53.
    Thereafter, the Board repeatedly stated that in order to prove a 
9(a) relationship, a union would have to show its ``express demand for, 
and an employer's voluntary grant of, recognition to the union as 
bargaining representative, based on a showing of support for the union 
among a majority of employees in an appropriate unit.'' Brannan Sand & 
Gravel Co., 289 NLRB 977, 979-980 (1988) (quoting American Thoro-Clean, 
283 NLRB 1107, 1108-1109 (1987)). And in J & R Tile, the Board held 
that, to establish voluntary recognition, there must be ``positive 
evidence'' that ``the union

[[Page 18369]]

unequivocally demanded recognition as the employees' 9(a) 
representative and that the employer unequivocally accepted it as 
such.'' 291 NLRB 1034, 1036 (1988).
    Subsequently, however, the Board held in Staunton Fuel & Material 
that a construction-industry union could prove 9(a) status based on 
contract language alone, without any other ``positive evidence'' of a 
contemporaneous showing of majority support. 335 NLRB 717, 719-720 
(2001). Citing two decisions from the United States Court of Appeals 
for the Tenth Circuit,\8\ the Board explained that contract language 
would be independently sufficient to prove a 9(a) relationship ``where 
the language unequivocally indicates that (1) the union requested 
recognition as the majority or 9(a) representative of the unit 
employees; (2) the employer recognized the union as the majority or 
9(a) bargaining representative; and (3) the employer's recognition was 
based on the union's having shown, or having offered to show, evidence 
of its majority support.'' 335 NLRB at 720. Finding that its contract-
based approach ``properly balance[d] Section 9(a)'s emphasis on 
employee choice with Section 8(f)'s recognition of the practical 
realities of the construction industry,'' the Board stated that its 
test would allow ``[c]onstruction unions and employers . . . to 
establish 9(a) bargaining relationships easily and unmistakably where 
they seek to do so.'' Id. at 719.
---------------------------------------------------------------------------

    \8\ NLRB v. Oklahoma Installation Co., 219 F.3d 1160 (10th Cir. 
2000); NLRB v. Triple C Maint., Inc., 219 F.3d 1147 (10th Cir. 
2000).
---------------------------------------------------------------------------

    However, the United States Court of Appeals for the District of 
Columbia Circuit has sharply disagreed with the Board's holding in 
Staunton Fuel. In Nova Plumbing, Inc. v. NLRB, the D.C. Circuit stated 
that ``[t]he proposition that contract language standing alone can 
establish the existence of a section 9(a) relationship runs roughshod 
over the principles established in [International Ladies' Garment 
Workers' Union v. NLRB, 366 U.S. 731 (1961) (Garment Workers)], for it 
completely fails to account for employee rights under sections 7 and 
8(f).'' 330 F.3d 531, 536-537 (DC Cir. 2003), granting review and 
denying enforcement of Nova Plumbing, Inc., 336 NLRB 633 (2001). 
According to the court, under Garment Workers ``[a]n agreement between 
an employer and union is void and unenforceable . . . if it purports to 
recognize a union that actually lacks majority support as the 
employees' exclusive representative.'' Id. at 537. The court further 
stated that, ``[w]hile section 8(f) creates a limited exception to this 
rule for pre-hire agreements in the construction industry, the statute 
explicitly preserves employee rights to petition for decertification or 
for a change in bargaining representative under such contracts.'' Id. 
``By focusing exclusively on employer and union intent,'' the court 
stated, the Board's test allowed employers and unions to ``collud[e] at 
the expense of employees and rival unions,'' betraying the Board's 
``fundamental obligation to protect employee section 7 rights.'' Id.
    The court returned to this theme in Colorado Fire Sprinkler, Inc. 
v. NLRB, 891 F.3d 1031 (DC Cir. 2018).\9\ There, the court--focusing 
closely on the centrality of employee free choice in determining when a 
Section 9(a) relationship has been established--stated that ``[t]he 
raison d'[ecirc]tre of the . . . Act's protections for union 
representation is to vindicate the employees' right to engage in 
collective activity and to empower employees to freely choose their own 
labor representatives.'' Id. at 1038 (emphasis in original). The court 
observed that Section 8(f) ``is meant not to cede all employee choice 
to the employer or union, but to provide employees in the inconstant 
and fluid construction and building industries some opportunity for 
collective representation . . . . [I]t is not meant to force the 
employees' choices any further than the statutory scheme allows.'' Id. 
at 1038-1039. Accordingly, the court held that ``the Board must 
faithfully police the presumption of Section 8(f) status and the strict 
burden of proof to overcome it'' by ``demand[ing] clear evidence that 
the employees--not the union and not the employer--have independently 
chosen to transition away from a Section 8(f) pre-hire arrangement by 
affirmatively choosing a union as their Section 9(a) representative.'' 
Id. at 1039. Applying this evidentiary standard, the court rejected the 
Board's reliance solely on contract language in finding a 9(a) 
relationship, stating that such reliance ``would reduce the requirement 
of affirmative employee support to a word game controlled entirely by 
the union and employer. Which is precisely what the law forbids.'' Id. 
at 1040.
---------------------------------------------------------------------------

    \9\ Granting review and denying enforcement of Colorado Fire 
Sprinkler, Inc., 364 NLRB No. 55 (2016).
---------------------------------------------------------------------------

    In the interest of restoring protection of employee free choice in 
the construction industry, the NPRM proposed to overrule Staunton Fuel, 
to adopt the D.C. Circuit's position that contract language alone 
cannot create a 9(a) bargaining relationship in that industry, and to 
therefore require positive evidence of majority union employee support 
before a collective-bargaining agreement or voluntary recognition 
between employers and unions would bar a petition to an election. For 
support, the NPRM stated that (1) as the D.C. Circuit recognized, 
Staunton Fuel permits an employer and union to ``paper over'' the 
presumption that construction-industry relationships are governed by 
Section 8(f); (2) under Staunton Fuel, the contract bar would prevent 
employees and rival unions from filing a Board election petition to 
challenge the union's representative status for the duration of the 
contract up to 3 years, even though there was never any extrinsic proof 
that a majority of employees supported the union; (3) the 
``conversion'' permitted under Staunton Fuel is similar to the flawed 
``conversion doctrine'' that the Deklewa Board repudiated; and (4) the 
D.C. Circuit raised a legitimate concern that Staunton Fuel conflicts 
with statutory majoritarian principles and represents an impermissible 
restriction on employee free choice, particularly in light of the 
protections intended by Section 8(f)'s second proviso.

II. Summary of Changes to the Proposed Rule

    In response to the comments received, the final rule changes the 
proposed rule with respect to all three policy areas discussed.

A. Blocking-Charge Policy

    For the reasons discussed in further detail in Section III.E. 
below, the final rule does not retain the proposed rule's vote-and-
impound procedure in all cases. Rather, it requires impoundment only 
for cases where the unfair labor practice charge, filed by the party 
that is requesting to block the election process, alleges (1) 
violations of Section 8(a)(1) and 8(a)(2) or Section 8(b)(1)(A) of the 
Act that challenge the circumstances surrounding the petition or the 
showing of interest submitted in support of the petition; or (2) that 
an employer has dominated a union in violation of Section 8(a)(2) and 
seeks to disestablish a bargaining relationship. For those categories 
of charges, the final rule--unlike the proposed rule--provides that the 
ballots shall be impounded for up to 60 days from the conclusion of the 
election if the charge has not been withdrawn or dismissed, or if a 
complaint has not issued, prior to the conclusion of the election. If a 
complaint issues with respect to the charge at any time prior to 
expiration of that 60-day post-election period, then the ballots shall 
continue to be

[[Page 18370]]

impounded until there is a final determination regarding the charge and 
its effect, if any, on the election petition. If the charge is 
withdrawn or dismissed at any time prior to expiration of that 60-day 
period, or if the 60-day period ends without a complaint issuing, then 
the ballots shall be promptly opened and counted. The final rule 
further provides that the 60-day period will not be extended, even if 
more than one unfair labor practice charge is filed serially.
    For all other types of unfair labor practice charges, the final 
rule--unlike the proposed rule--provides that the ballots will be 
promptly opened and counted at the conclusion of the election, rather 
than temporarily impounded.
    Finally, for all types of charges upon which a blocking-charge 
request is based, the final rule clarifies that the certification of 
results (including, where appropriate, a certification of 
representative) shall not issue until there is a final disposition of 
the charge and a determination of its effect, if any, on the election 
petition.\10\ The final rule also makes some minor, non-substantive 
changes to the title of the proposed rule.
---------------------------------------------------------------------------

    \10\ As noted previously, nothing in the final rule alters the 
existing requirements that only a party to the representation 
proceeding may file the request to block the election process; only 
unfair labor practice charges filed by that party may be the subject 
of a request to block; that party must file a written offer of proof 
as well as the names of witnesses who will testify in support of the 
charge and a summary of each witness's anticipated testimony; and 
that party must promptly make available to the regional director the 
witnesses identified in the offer of proof.
---------------------------------------------------------------------------

    In short, under the final rule, the filing of a blocking-charge 
request will not delay the conduct of an election but may delay the 
vote count or certification of results. The regional director shall 
continue to process the petition and conduct the election.

B. Voluntary-Recognition Bar

    For the reasons discussed in Section III.F. below, upon 
consideration of all of the comments received, we have decided to adopt 
the proposed rule in substantial part. However, in response to certain 
comments, we have modified the rule to clarify that it shall apply only 
to an employer's voluntary recognition on or after the effective date 
of the rule, and to the first collective-bargaining agreement reached 
after such voluntary recognition. Additionally, the final rule 
clarifies that the employer ``and/or'' (rather than ``and'') the labor 
organization must notify the Regional Office that recognition has been 
granted. The final rule also specifies where the notice should be 
posted (``in conspicuous places, including all places where notices to 
employees are customarily posted''); eliminates the proposed rule's 
specific reference to the right to file ``a decertification or rival-
union petition'' and instead refers generally to ``a petition''; adds a 
requirement that an employer distribute the notice to unit employees 
electronically if the employer customarily communicates with its 
employees by such means; and sets forth the wording of the notice. The 
final rule also makes some minor, non-substantive changes to the title 
and other wording of the proposed rule.

C. Proof of Majority-Based Recognition in the Construction Industry

    For clarity purposes, we have removed the amendment regarding proof 
of majority-based voluntary recognition in the construction industry 
from Sec.  103.21 of the proposed rule and have placed it in its own 
section, Final Rule (Rule) Sec.  103.22. In addition, for the reasons 
discussed in Section III.G. below, we have decided upon consideration 
of comments received to adopt the proposed rule with one modification: 
This portion of the final rule shall apply only to voluntary 
recognition extended on or after the effective date of the rule and to 
any collective-bargaining agreement entered into on or after the date 
of voluntary recognition extended on or after the effective date of the 
rule. The final rule also makes some minor, non-substantive changes to 
the wording of the proposed rule.\11\
---------------------------------------------------------------------------

    \11\ In accordance with the discrete character of the matters 
addressed by each of the amendments listed, the Board hereby 
concludes that it would adopt each of these amendments individually, 
or in any combination, regardless of whether any of the other 
amendments were made. For this reason, the amendments are severable.
---------------------------------------------------------------------------

III. Summary of Comments and Responses to Comments

    The Board received more than 80 comments from interested 
organizations, labor unions, members of Congress, academics, and other 
individuals. We have carefully reviewed and considered these comments, 
as discussed below.

A. Propriety of Rulemaking

    One commenter contends that we have failed to adequately justify 
departing from the Board's longstanding practice of proceeding by 
adjudication.\12\ However, Congress has delegated general rulemaking 
authority to the Board. Specifically, Section 6 of the NLRA, 29 U.S.C. 
156, provides that the Board ``shall have authority from time to time 
to make, amend, and rescind, in the manner prescribed by [the 
Administrative Procedure Act (APA)], such rules and regulations as may 
be necessary to carry out the provisions of [the NLRA].'' Although the 
Board historically has made most substantive policy determinations 
through case adjudication, it has, with Supreme Court approval, engaged 
in substantive rulemaking. American Hosp. Ass'n v. NLRB, 499 U.S. 606 
(1991) (upholding Board's rulemaking on appropriate bargaining units in 
the healthcare industry). In this regard, the Supreme Court has 
expressly stated that ``the choice between rulemaking and adjudication 
lies in the first instance within the Board's discretion.'' NLRB v. 
Bell Aerospace Co., 416 U.S. 267, 294 (1974).
---------------------------------------------------------------------------

    \12\ Comment of AFL-CIO.
---------------------------------------------------------------------------

    Further, Section 6 authorizes the final rule as necessary to carry 
out Sections 1, 7, 8, and 9 of the Act, 29 U.S.C. 151, 157, 158, and 
159, respectively, discussed in relevant part in Section I.A. above. 
The Board's election policies implicate each of these provisions of the 
Act, and Section 6 grants the Board the authority to promulgate rules 
that carry out those provisions.
    As discussed in Section I.B.2. above, in the NPRM the Board 
expressed its preliminary belief that rulemaking in this area of the 
law is desirable for several reasons. After carefully considering more 
than 80 comments, we continue to believe that rulemaking, rather than 
adjudication, is the better method to revise and clarify the matters of 
broad application at issue in this rule.
    First, the Board has repeatedly engaged in rulemaking to amend its 
representation-case procedures over the years as part of a continuing 
effort to improve the process and to eliminate unnecessary delays. It 
has only rarely utilized the APA's notice-and-comment rulemaking 
procedures when doing so. Most often, the Board has simply implemented 
procedural changes in a final rule without prior notice or request for 
public comment. It did so most recently in December 2019. See 
Representation-Case Procedures, 84 FR 69524 (Dec. 18, 2019) (2019 
Election Rule). However, a few years earlier, the Board engaged in a 
notice-and-comment rulemaking process that resulted in a final rule 
making widespread revisions in prior representation-case procedures. 
See 79 FR 74307 (December 15, 2014).\13\

[[Page 18371]]

Further, as here, some of the procedures addressed in that rulemaking 
process were originally established in adjudication.
---------------------------------------------------------------------------

    \13\ See also comment of AFL-CIO in support of the Board's 2015 
Election Rule. 79 FR at 74314 (``[T]he American Federation of Labor 
and Congress of Industrial Organizations (AFL-CIO) states that 
`[t]he NLRB has specific and express statutory authority to engage 
in rule-making to regulate its election process.''').
---------------------------------------------------------------------------

    Second, the Board has been well served by public comment on the 
issues presented in response to the NPRM in this proceeding. The Board 
received numerous helpful comments from a wide variety of sources, many 
with considerable legal expertise and/or a great deal of relevant 
experience. Having considered these comments, we have refined the final 
rule in several ways, outlined above in Sections II.A. through II.C. 
and discussed more fully below in Sections III.E. through III.G. It is 
likely that we would not have received as much input had we addressed 
these issues through adjudication rather than rulemaking. Rulemaking 
has given interested persons a way to provide input through the 
convenient comment process, and participation was not limited, as in 
the adjudicatory setting, to legal briefs filed by the parties and 
amici.
    Third, as discussed in the NPRM, rulemaking has allowed us to 
address these issues without depending on the participation and 
argument of parties in a specific case, and without allowing the 
developments of a pending case to ``moot'' the issues. One commenter 
challenges this notion, arguing that the Board can avoid mootness by 
refusing to allow parties to withdraw cases or concede issues in 
adjudication.\14\ That commenter also contends that the existence of 
live controversies involving particular parties demonstrates that an 
issue is important to labor-management relations and merits Board 
resolution via adjudication.\15\
---------------------------------------------------------------------------

    \14\ Comment of AFL-CIO (citing, e.g., 800 River Road Operating 
Co. d/b/a Care One at New Milford, 368 NLRB No. 60 (2019)).
    \15\ Comment of AFL-CIO.
---------------------------------------------------------------------------

    As discussed in greater detail in the NPRM, developments in 
specific cases have mooted some of the very issues covered by this 
rulemaking. See 84 FR at 39937 (citing Loshaw Thermal Technology, LLC, 
Case 05-CA-158650). As the commenter suggests, the Board has the 
discretion to refuse to allow parties to withdraw cases or to concede 
issues in a particular case. However, the existence of live 
controversies in adjudication of an issue does not mean that we lack 
the discretion to choose rulemaking as the means to address that issue. 
In addition, as discussed in the NPRM, this particular rulemaking has 
allowed us to address, in a single proceeding, three related election-
bar issues that have not arisen--and likely would not arise--in the 
adjudication of a single case.
    Fourth, as discussed in the NPRM, establishing the new standards in 
the Board's Rules and Regulations will enable employers, unions, and 
employees to plan their affairs with greater certainty that significant 
changes to these areas of the law will not be made, and retroactively 
applied, in adjudication of a case to which they are not parties and 
about which they may be unaware. NLRB v. Wyman-Gordon Co., 394 U.S. 
759, 777 (1969) (Douglas, J., dissenting) (``The rule-making procedure 
performs important functions. It gives notice to an entire segment of 
society of those controls or regimentation that is forthcoming.''). 
Specifically, rulemaking enables the Board to provide the regulated 
community greater certainty beforehand, as the Supreme Court has 
instructed that we should do. First Nat'l Maint. Corp. v. NLRB, 452 
U.S. 666, 679 (1981).
    The same commenter also claims that the Board's recent increased 
use of rulemaking rather than waiting for actual controversies to arise 
threatens to open the floodgates of policy oscillation. The claim is 
purely speculative, and runs counter to the general perception that 
rulemaking should diminish policy oscillation because it is harder to 
change policy through rulemaking than through adjudication.\16\ The 
commenter also contends that the Board fails to explain why rulemaking 
is appropriate here when the Board is not using it in numerous other 
areas, and that many of the stated reasons for proceeding through 
rulemaking in this context would apply in other contexts as well.\17\ 
However, even if rulemaking is appropriate in other areas, that does 
not require us to use rulemaking in all areas where it would be 
appropriate, let alone all at once. Cf. Mobil Oil Expl. & Producing Se. 
Inc. v. United Distrib. Cos., 498 U.S. 211, 231 (1991) (``[A]n agency 
need not solve every problem before it in the same proceeding.''); 
Advocates for Highway & Auto Safety v. Fed. Motor Carrier Safety 
Admin., 429 F.3d 1136, 1147 (D.C. Cir. 2005) (``Agencies surely may, in 
appropriate circumstances, address problems incrementally.''). And, as 
stated above, ``the choice between rulemaking and adjudication lies in 
the first instance within the Board's discretion.'' NLRB v. Bell 
Aerospace Co., 416 U.S. at 294. Thus, this comment does not demonstrate 
that rulemaking is inappropriate here.
---------------------------------------------------------------------------

    \16\ See, e.g., Samuel Estreicher, Policy Oscillation at the 
Labor Board: A Plea for Rulemaking, 37 Admin. L. Rev. 163 (1985).
    \17\ Comment of AFL-CIO.
---------------------------------------------------------------------------

    In sum, we continue to believe that use of the rulemaking process 
here is an appropriate exercise of the Board's discretion and will be 
beneficial in ways that adjudication cannot be.

B. Board Members' Alleged Closed-Mindedness and Motives

    Some commenters allege that the current Board Members have not 
shown an open mind and willingness to revise the wording proposed in 
the NPRM in light of public input because each Member previously has 
expressed a desire to revise the policies under consideration.\18\ For 
the reasons that follow, we reject these contentions. We assure the 
public that each participating

[[Page 18372]]

Board Member has approached this rulemaking with an open mind.
---------------------------------------------------------------------------

    \18\ Comment of AFL-CIO (citing Pinnacle Foods Group, LLC., Case 
14-RD-226626, 2019 WL 656304, at *1 fn. 1 (Feb. 4, 2019) (Chairman 
Ring and Member Kaplan); United Food & Commercial Workers, Local No. 
951, Case 07-RD-228723, 2019 WL 1879483, at *1 fn.1 (April 25, 2019) 
(Chairman Ring and Member Emanuel); Heavy Materials, LLC., Case 12-
RM-231582, 2019 WL 2353690, at *1 fn.1 (May 30, 2019) (Members 
Kaplan and Emanuel); G.F. Paterson Foods, LLC, Case 22-RD-210352, 
2018 WL 509465, at *1 fn.1 (Jan. 19, 2018) (Members Kaplan and 
Emanuel); Leggett & Platt, Inc., Case 09-RD-200329, 2018 WL 509463, 
at *1 fn.1 (Jan. 19, 2018) (Member Kaplan); Calportland Arizona 
Materials Division, Case 28-RD-206696, 2018 WL 571496, at *1 fn.1 
(Jan. 24, 2018) (Members Kaplan and Emanuel); Covanta Essex Co., 
Case 22-RD-199469, 2018 WL 654848, at *1 fn.1 (Jan. 30, 2018) 
(Members Kaplan and Emanuel); Wismettac Asian Foods, Inc., Case 21-
RC-204759, 2018 WL 774103, at *1 n.1 (Feb. 6, 2018) (Member Kaplan); 
Apple Bus Co., Case 19-RD-216636, 2018 WL 3703490, at *1 fn.1 (May 
9, 2018) (Members Kaplan and Emanuel); Kloeckner Metals Corp., Case 
15-RD-217981, 2018 WL 2287088, at *1 fn.1 (May 17, 2018) (Members 
Kaplan and Emanuel); Bemis N.A., Case 18-RD-209021, 2018 WL 2440794, 
at *1 fn.1 (May 29, 2018) (Member Emanuel); Janus Youth Programs, 
Inc., Case 19-RM-216426, 2018 WL 2461411, at *1 fn.1 (May 31, 2018); 
Arh Mary Breckinridge Health Services, Inc., Case 09-RD-217672, 2018 
WL 3238969, at *1 fn.1 (June 29, 2018) (Chairman Ring and Member 
Kaplan); American Medical Response, Case 10-RC-208221, 2018 WL 
3456223, at *1 fn.1 (July 17, 2018) (Chairman Ring and Member 
Emanuel); Apple Bus Co., Case 19-RD-216636, 2018 WL 3703490, at *1 
fn.1 (Aug. 2, 2018) (Chairman Ring and Member Kaplan); Columbia 
Sussex, Case 19-RD-223516, 2018 WL 4382911, at *1 fn.1 (Sept. 12, 
2018) (Chairman Ring and Member Kaplan); Westrock Services, Inc., 
Case 10-RD-195447, 2017 WL 4925475, at *1 fn.1 (Oct. 27, 2017) 
(Members Kaplan and Emanuel); ADT Security Services, Case 18-RD-
206831, 2017 WL 6554381, at *1 fn.1 (Dec. 20, 2017) (Members Kaplan 
and Emanuel). See also Comment of United Food and Commercial Workers 
International Union, AFL-CIO (UFCW) (citing L&L Fabrication, Case 
16-RD-232491, 2019 WL 1800677, at *1 fn. 1 (April 22, 2019) 
(Chairman Ring and Member Emanuel); Embassy Suites by Hilton, 
Seattle Downtown Pioneer Square, Case 19-RD-223236, 2019 WL 656277, 
at *1 fn. 1 (Jan. 15, 2019) (Chairman Ring and Member Kaplan); Heavy 
Materials, LLC, supra; Pinnacle Foods Group, LLC, supra; Loshaw 
Thermal Technology, LLC, Case 05-CA-158650, 2018 WL 4357198 
(soliciting briefs addressing proposed changes to the Sec. 8(f)-to-
9(a) conversion doctrine)).
---------------------------------------------------------------------------

    ``[A]n individual should be disqualified from rulemaking only when 
there has been a clear and convincing showing'' that the official ``has 
an unalterably closed mind on matters critical to the disposition of 
the proceeding.'' Air Transp. Ass'n of America, Inc. v. NMB, 663 F.3d 
476, 487 (D.C. Cir. 2011) (quoting C & W Fish Co. v. Fox, 931 F.2d 
1556, 1564 (D.C. Cir. 1991)). Moreover, ``[a]n administrative official 
is presumed to be objective and `capable of judging a particular 
controversy fairly on the basis of its own circumstances.' '' 
Steelworkers v. Marshall, 647 F.2d 1189, 1208 (D.C. Cir. 1980) (quoting 
United States v. Morgan, 313 U.S. 409, 421 (1941)). Further, 
``[w]hether the official is engaged in adjudication or rulemaking,'' 
the fact that he or she ``has taken a public position, or has expressed 
strong views, or holds an underlying philosophy with respect to an 
issue in dispute cannot overcome that presumption.'' Id. That 
presumption also is not overcome ``when the official's alleged 
predisposition derives from [his or] her participation in earlier 
proceedings on the same issue.'' Id. at 1209. Expanding on the latter 
point, the D.C. Circuit has explained that ``[t]o disqualify 
administrators because of opinions they expressed or developed in 
earlier proceedings would mean that `experience acquired from their 
work . . . would be a handicap instead of an advantage.' '' Id. 
(quoting FTC v. Cement Inst., 333 U.S. 683, 702 (1948)). More recently, 
the D.C. Circuit has similarly emphasized that it would ``eviscerate 
the proper evolution of policymaking were we to disqualify every 
administrator who has opinions on the correct course of his agency's 
future actions.'' Air Transp. Ass'n of America, Inc., 663 F.3d at 488 
(quoting C & W Fish Co., 931 F.2d at 1565).
    Accordingly, the fact that the Board Members previously have 
expressed views on the subjects of this rulemaking is insufficient to 
demonstrate that they have engaged in this rulemaking with unalterably 
closed minds. See Air Transp. Ass'n of America, Inc., 663 F.3d at 487-
488; Steelworkers, 647 F.2d at 1208-1209. Indeed, after considering all 
of the submitted comments, we have revised the proposed rule in various 
respects. This in itself demonstrates that the Members did not engage 
in this endeavor with unalterably closed minds.
    One commenter contends that although the Board's stated goal is to 
protect employees' rights, in many recent cases the Board has sought to 
destabilize bargaining relationships and to allow employers to 
undermine unions, often under the guise of protecting employee 
choice.\19\ We do not agree that either this rule or the cited, recent 
cases demonstrate an intention to destabilize bargaining relationships 
or to allow employers to undermine unions. Nor do we believe that 
either this rule or the cited cases are likely to have those effects. 
Accordingly, we disagree with this comment.
---------------------------------------------------------------------------

    \19\ Comment of UFCW (citing Mike-Sell's Potato Chip Co., 368 
NLRB No. 145 (2019); Valley Hospital Medical Center, Inc. d/b/a 
Valley Hospital Medical Center, 368 NLRB No. 139 (2019); MV 
Transportation, Inc., 368 NLRB No. 66 (2019); Johnson Controls, 
Inc., 368 NLRB No. 20 (2019); Metalcraft of Mayville, Inc., 367 NLRB 
No. 116 (2019); Raytheon Network Centric Systems, Inc., 365 NLRB No. 
161 (2017)).
---------------------------------------------------------------------------

    Other commenters contend that here and in other areas, the Board is 
using rulemaking simply to reverse precedent that it does not like.\20\ 
However, like case adjudication, rulemaking involves reasoned decision-
making, conducted within the constraints of the APA and subject to 
judicial review. As demonstrated here and below, we have carefully 
considered all comments with an open mind, and we believe that the 
final rule we have formulated represents our reasoned determination 
regarding the appropriate standards for furthering the various policies 
discussed herein, including--and especially--protecting employee free 
choice.
---------------------------------------------------------------------------

    \20\ Comments of AFL-CIO; UFCW.
---------------------------------------------------------------------------

C. Alleged Procedural Errors

    One commenter claims that the Board committed procedural errors in 
two ways. First, the commenter claims that the Board majority did not 
provide the dissenting Member adequate time to prepare her dissent, 
citing her statement that she had not been given sufficient time to 
review all of the relevant data in the appendices to the NPRM.\21\ 
Second, the commenter claims that the Board did not provide interested 
parties adequate time to prepare their comments on the proposed 
rule.\22\ Specifically, the commenter notes that the Board denied its 
third motion for an additional 30 days to file comments, despite the 
fact that the commenter still had six Freedom of Information Act (FOIA) 
requests pending before the Board.\23\ According to the commenter, the 
documents that it has sought are essential to evaluate both the 
empirical foundation of the proposed rule and the integrity of the 
rulemaking process.\24\
---------------------------------------------------------------------------

    \21\ Comment of AFL-CIO (citing 84 FR at 39947 fn. 74). See also 
Comment of Senator Patty Murray.
    \22\ Comment of AFL-CIO.
    \23\ Comment of AFL-CIO. As the commenter acknowledges, the 
Board provided responsive documents to its other FOIA requests 
before the extended comment period closed.
    \24\ Comment of AFL-CIO.
---------------------------------------------------------------------------

    As an initial matter, we reject the unsubstantiated claim of the 
dissenting Member that she lacked adequate time to prepare her 
dissent.\25\ Moreover, the Board has previously stated that it ``does 
not believe that it is required, either by law or agency practice, to 
delay the adoption and publication of a final rule in order to 
accommodate a dissenting Member. Nothing in the APA compels that course 
of action, nor does the National Labor Relations Act demand it. Neither 
do the Board's rules, statements of procedure, internal operating 
procedures, or traditional practices, which do not address the internal 
process of rulemaking, compel such action.'' Representation--Case 
Procedure, 76 FR 80138, 80146 (Dec. 22, 2011) (footnotes omitted). 
There is no reason that this observation should not apply with equal 
force to issuance of an NPRM. In any event, however, we assure the 
public that Member McFerran was provided sufficient time to prepare her 
dissent.
---------------------------------------------------------------------------

    \25\ Accord Air Trans. Ass'n of America, Inc. v. NMB, 663 F.3d 
at 487-488 (court denied challenge to National Mediation Board's 
rule based on majority's action providing dissenter only 24 hours to 
consider and prepare dissent, which she did).
---------------------------------------------------------------------------

    Further, the evidence that Member McFerran stated she lacked 
sufficient time to address was the supplemental Board data cited in 
reference to a prior non-Board study and expressions of concern by two 
respected academics about the adverse impact of the blocking-charge 
policy. See 84 FR at 39933, 39947. Some of the same data is at issue in 
the cited items sought in the commenter's FOIA request.\26\ As 
discussed in Section III.E. below, even accepting that some of the data 
that the NPRM cited is flawed, we continue to believe that the record 
supports finding a systemic problem of unacceptable election delays 
resulting from the

[[Page 18373]]

blocking-charge policy.\27\ We also note that Member McFerran was able 
to prepare a comprehensive ``preliminary'' review of blocking-charge 
information for Fiscal Years 2016 and 2017 independent of the data 
relied on by the majority or provided to the public in the past. 84 FR 
at 39943-39944. Likewise, during the comment period, Professor John-
Paul Ferguson prepared an extensive review of data provided to the AFL-
CIO that was appended to its comment. Yet another review critical of 
the Board majority's analysis in the NPRM was prepared by Bloomberg Law 
and cited by commenters in opposition to the proposed blocking-charge 
rule.\28\ Consequently, there is no basis for finding that the 
dissenting Board Member was prejudiced by the alleged lack of time to 
review the data originally cited or that, with respect to its FOIA 
requests 2, 5, or 13, the commenter was prejudiced by the denial of its 
request for an extension of time.\29\
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    \26\ The commenter's Request #2 seeks ``[a]ny document that 
contains or evidences any analysis of the impact of the adoption of 
29 CFR 103.20 on the number of blocking charges, the time needed to 
process blocking charges, the delay caused by blocking charges, or 
any other case processing outcomes.'' AFL-CIO's Aug. 29, 2019 FOIA 
Request at 2. The commenter's Request #5 seeks ``[a]ny document 
containing or evidencing any explanation of any decision to 
aggregate multiple blocking periods (even when they ran or are 
running concurrently) in producing the table in Appendix A [sic] to 
the NPRM.'' Id. And the commenter's Request #13 seeks ``[a]ny 
documents containing or evidencing a comparison of the disposition 
of unfair labor practice charges filed by unions accompanied by or 
followed by requests to block an election and the disposition of 
unfair labor practice charges filed by unions not accompanied or 
followed by such a request.'' Id. at 3.
    \27\ As the AFL-CIO concedes: ``Blocking elections delays 
elections. That is undeniably true and requires no `statistical 
evidence' to demonstrate.'' Comment of AFL-CIO at 5.
    \28\ See Alex Ebert and Hassan A. Kanu, Federal Labor Board Used 
Flawed Data to Back Union Election Rule, Bloomberg Law (Dec. 5, 
2019), https://news.bloomberglaw.com/daily-labor-report/federal-labor-board-used-flawed-data-to-back-union-election-rule-1.
    \29\ We emphasize that our response to this comment only 
addresses the argument that the failure to provide remaining 
requested documents was prejudicial to the commenter's ability to 
evaluate the rulemaking process. We express no opinion concerning 
whether any of the requested information is disclosable under FOIA.
---------------------------------------------------------------------------

    The commenter also requested ``[a]ny analysis of the effect or 
impact of Dana Corp., 351 NLRB 434 (2007), other than those contained 
in the opinions in Lamons Gasket, 357 NLRB 739 (2011).'' AFL-CIO's Aug. 
29, 2019 FOIA Request at 3 (Request #19). However, in issuing the 
final-rule amendment regarding the voluntary-recognition bar, we do not 
rely on any data, or analysis of data, other than that discussed in 
Dana and in Lamons Gasket, which we have fully considered. In these 
circumstances, we find no basis for concluding that the commenter was 
prejudiced by the denial of its request for an extension of time with 
regard to this FOIA request.
    Further, the commenter requested ``[a]ny documents containing or 
evidencing any statement by any Board member concerning the validity, 
wisdom or soundness of the Board's blocking[-]charge policy; Lamons 
Gasket Co., 357 NLRB 739 (2011); Dana Corp., 351 NLRB 434 (2007); or 
conversion of 8(f) to 9(a) relationships.'' AFL-CIO's Aug. 29, 2019 
FOIA Request at 4 (Request #22). According to the commenter, the 
requested documents are relevant to the Board Members' alleged 
``predisposition and bias'' and their ability ``to fairly evaluate 
comments as required by the APA.'' \30\ As discussed in Section III.B. 
above, however, the mere fact that Board Members previously have 
expressed opinions regarding these matters does not provide a basis for 
concluding that they have approached these issues with closed minds. 
That would be the case under applicable precedent even if we were 
issuing a final rule identical to the proposed rule, but it is even 
more clearly the case given that we have modified the proposed rule in 
response to comments. Therefore, there is no basis for finding that the 
commenter was prejudiced by not receiving this requested information 
before the end of the comment period.
---------------------------------------------------------------------------

    \30\ Comment of AFL-CIO.
---------------------------------------------------------------------------

    Finally, one of the commenter's FOIA requests was for ``[a]ny 
document containing or evidencing any limitations of the time allowed 
Member McFerran to prepare her dissent to the NPRM, any limitations on 
the access allowed Member McFerran to case processing information or 
data she deemed necessary to prepare her dissent, or any limitations on 
access to NLRB or General Counsel staff she deemed necessary to prepare 
her dissent.'' AFL-CIO's Aug. 29, 2019 FOIA Request at 3 (Request #21). 
As discussed above, however, we reject any suggestion that Member 
McFerran had inadequate time to prepare her dissent. We likewise reject 
the unfounded suggestion that there was any limitation on her ability 
to access necessary resources to prepare that dissent.
    Inasmuch as there is neither statutory authority nor binding Board 
practice requiring that a dissenting member has the right to any amount 
of time to prepare a dissent, the material question here is simply 
whether the commenters have had sufficient time to provide their 
comments. Preliminarily, the APA provides no minimum comment period, 
and many agencies, including the Board in past rulemaking proceedings, 
have afforded comment periods of only 30 days. Agencies have discretion 
to provide still shorter periods and are simply ``encouraged to provide 
an appropriate explanation for doing so.'' Admin. Conference of the 
U.S., Recommendation 2011-2, Rulemaking Comments, 76 FR 48791 (Aug. 9, 
2011).
    As noted previously, the NPRM, which issued on August 12, 2019, set 
an initial comment period of 60 days, with 14 additional days allotted 
for reply comments. Although the APA does not require a reply period, 
the Board provided it to give itself the best opportunity to gain all 
information necessary to make an informed decision. Then, the Board 
extended the comment and reply periods twice, for 90 additional days. 
In sum, the Board has accepted comments on 3 proposed amendments to its 
representation-case procedures for a total of 164 days.\31\ We believe 
that the more than 80 comments submitted and the depth of analysis that 
many of them provide, including the comment and reply from the AFL-CIO, 
are a testament to the adequacy of the comment period. As such, we do 
not believe that this commenter was prejudiced by the fact that, at the 
closing of the extended comment period, the Board had not yet provided 
all documents responsive to its broad FOIA request.
---------------------------------------------------------------------------

    \31\ We note that in a prior rulemaking of far greater scope, 
involving 25 proposed amendments to a wide range of representation-
case procedures, the Board found that acceptance of comments on 
these proposals for a total of 141 days, and 4 days of public 
hearings, was adequate. See 79 FR at 74311.
---------------------------------------------------------------------------

    Accordingly, we reject the commenter's claims regarding alleged 
procedural errors.

D. Matters Outside the Scope of This Rulemaking

    Several commenters propose that we take various other actions,\32\ 
but because those actions are outside the scope of this rulemaking, we 
decline to take them.\33\
---------------------------------------------------------------------------

    \32\ See Comments of Center on National Labor Policy, Inc. 
(CNLP) (suggesting raising the Board's jurisdictional standards); 
Anonymous (suggesting that the Board address the unfair labor 
practice investigation process); National Federation of Independent 
Business (NFIB) (suggesting proposing particular legislation to 
Congress); Coalition for a Democratic Workplace (CDW) (suggesting 
rulemaking to rescind and revise the Board's 2015 Election Rule).
    \33\ However, with regard to the recommendation to rescind and 
revise the Board's 2015 Election Rule, we note that we already have 
revised that Rule in certain respects. See 2019 Election Rule, 84 FR 
69524.
---------------------------------------------------------------------------

E. Final-Rule Amendment Regarding Blocking-Charge Policy

    The Board received numerous comments on the amendment concerning 
the blocking-charge policy. We have carefully reviewed and considered 
these comments, as discussed below.
1. Comments in Favor of, and Comments Opposed to, Changing the 
Blocking-Charge Policy by Eliminating the Practice of Delaying 
Elections
    As stated above, the NPRM proposed that the current blocking-charge 
policy be revised to provide that a request to block would no longer 
delay the processing of an otherwise valid

[[Page 18374]]

petition and the timely conduct of an election. Under the proposed 
rule, if the blocking charge is still pending upon conclusion of the 
election, ballots would be impounded and not counted until there is a 
final determination regarding the charge and its effect, if any, on the 
election petition or fairness of the election.
    Not surprisingly, the commenters on the blocking-charge policy tend 
to fall into two sharply divided groups. Commenters in the first group 
support the proposed modification and urge the Board to require regions 
to process representation petitions despite a request to block based on 
a pending unfair labor practice charge. One commenter cites the mandate 
in Section 9(c) of the Act that, ``[i]f the Board finds . . . that . . 
. a question of representation exists, it shall direct an election by 
secret ballot and shall certify the results thereof.'' \34\ According 
to this commenter, the blocking-charge policy is an administrative 
fiction that the Board has used to evade its statutory 
responsibility.\35\ A second commenter suggests that the blocking-
charge policy is contrary to Section 8(a)(2) of the Act, 29 U.S.C. 
158(a)(2), because it permits unions to serve as employees' 
representative where a majority of the employees do not support union 
representation.\36\ And another commenter notes that, under the Act, 
the Board may not defer representation proceedings to the General 
Counsel, which is allegedly what occurs when the processing of 
elections depends on whether the General Counsel issues a 
complaint.\37\
---------------------------------------------------------------------------

    \34\ Comment of CNLP (quoting 29 U.S.C. 159(c)).
    \35\ Id.
    \36\ Comment of CDW.
    \37\ Comment of CNLP.
---------------------------------------------------------------------------

    Several commenters cite the adverse impact on employees when they 
are forced to wait indefinitely to vote in a representation 
election.\38\ In this regard, commenters assert that delaying the 
election punishes employees for the misconduct alleged in an unfair 
labor practice charge, even if they had no role in that alleged 
misconduct.\39\ Commenters also contend that an indefinite delay in an 
election affects employees' vote when the election is finally held. For 
instance, it causes some employees to perceive the Board and its 
processes as futile.\40\ Further, the election's delay denies employees 
the opportunity to vote while the issues surrounding the petition 
effort for an election are fresh in their minds.\41\ Commenters also 
echo the concern expressed in the NPRM about turnover in the workforce 
during the delay caused by a blocking charge, with the result that 
employees who supported the petition may not be the ones who vote on 
the representation issue when the election is finally held.\42\ One 
commenter notes the adverse effect of blocking-charge delays on 
construction-industry employees working under a Section 8(f) 
agreement--a majority of whom may never have supported the union 
representative--who seek to decertify the union through a Board 
election.\43\ One employee commenter notes his own frustration that, 
for years, he was unable to vote in an election to remove an incumbent 
union as his bargaining representative because the union filed unfair 
labor practice charges.\44\ Meanwhile, a union local commenter 
expresses support for modifying the blocking-charge policy because of 
how important it is for employees to express their choice on union 
representation without delays to create a more level playing field in 
the organizing process.\45\
---------------------------------------------------------------------------

    \38\ Comments of Council on Labor Law Equality (COLLE); 
Representatives Virginia Foxx and Tim Walberg; General Counsel Peter 
Robb (GC Robb); CNLP; CDW; Chamber of Commerce (the Chamber).
    \39\ Comments of Associated Builders and Contractors (ABC); 
National Right to Work Legal Defense Foundation, Inc. (NRWLDF).
    \40\ Comments of CDW; COLLE.
    \41\ Comment of GC Robb.
    \42\ Comment of COLLE; CDW.
    \43\ Comment of CNLP.
    \44\ Comment of Donald Johnson.
    \45\ Comment of International Brotherhood of Electrical Workers 
Local 304 (Local 304).
---------------------------------------------------------------------------

    Some commenters argue that employers, too, are harmed when 
meritless unfair labor practice charges block an election. One 
commenter notes that, as the Board acknowledged in the NPRM, blocking 
charges can deprive employers of the supposed ``safe harbor'' in filing 
an RM election petition that the Board majority referenced in Levitz 
Furniture Co. of the Pacific, 333 NLRB at 726, as an alternative to the 
option of withdrawing recognition (which the employer selects at its 
peril).\46\ Another commenter notes the adverse effect on an employer 
signatory to a construction-industry collective-bargaining agreement 
negotiated under Section 8(f) by a union without majority support. 
Although an election petition can be filed at any time during the 
contract term, a blocking charge can indefinitely postpone an election 
that could result in decertification of the union and voiding the 
contract.\47\ One commenter also states that when meritless unfair 
labor charges are filed to delay an election, the Board must needlessly 
waste its resources in conducting a pointless investigation, and 
employers are forced to expend limited funds in defending against such 
allegations.\48\
---------------------------------------------------------------------------

    \46\ Comment of CDW.
    \47\ Comment of CNLP.
    \48\ Comment of NRWLDF.
---------------------------------------------------------------------------

    Several commenters assert the current blocking-charge policy is too 
often used as an attempt to rig the rules.\49\ One commenter notes that 
blocking charges overwhelmingly affect decertification elections, and 
that those elections are delayed the longest.\50\ Another commenter 
compares the current policy to an incumbent U.S. officeholder being 
able to decide when and under what circumstances to submit to a future 
election.\51\ According to some commenters, this is because a union, 
aware of a lack of employee support, may simply choose to file an 
unfair labor practice charge to forestall an election, potentially for 
as long as necessary until it believes it can prevail.\52\ In addition 
to receiving a temporary delay, the union may hope that, by chance, a 
regional director's investigation may discover evidence of other 
conduct that becomes the basis for issuing a complaint that delays the 
election even longer.\53\ One commenter claims that the passage of 
time, employee turnover, and other changed circumstances may give the 
union the chance of hanging on as employees, exasperated by their 
inability to obtain an election, decide to leave.\54\ Additionally, one 
commenter contends, the union continues to represent the employees 
indefinitely and may use that time to pressure them into voting for it, 
if an election ever does occur.\55\ According to one commenter, 
employee free choice eventually turns into employees having no choice 
at all because the union effectively gets to decide whether an election 
is held--and the union will always pick its own survival over the 
preference of unit employees.\56\ Thus, one commenter notes, the 
current policy leads to an undemocratic charade that forces employees 
to endure a prolonged, if not futile, wait before being able to 
exercise their right to express their free choice as to whether to be 
represented.\57\
---------------------------------------------------------------------------

    \49\ Comments of GC Robb; NRWLDF; the Chamber.
    \50\ Comment of CDW.
    \51\ Comment of COLLE.
    \52\ Comments of COLLE; Representatives Foxx and Walberg; 
NRWLDF.
    \53\ Comment of NRWLDF.
    \54\ Comment of CDW.
    \55\ Comment of the Chamber.
    \56\ Comment of NRWLDF.
    \57\ Comment of Representatives Foxx and Walberg.
---------------------------------------------------------------------------

    The group of commenters opposed to change in the current blocking-
charge

[[Page 18375]]

policy focus on situations where an allegedly meritorious unfair labor 
practice charge taints a representation petition or otherwise spoils 
laboratory conditions for conducting an election, thereby preventing 
employees from making a truly free choice as to union representation. 
Some of those commenters argue that it would be inconsistent with 
Section 9(c) of the Act for a regional director to process a 
representation petition in those circumstances because the regional 
director would not have ``reasonable cause to believe'' that a question 
of representation exists--a prerequisite to an election under Section 
9(c).\58\ One commenter claims that a meritorious unfair labor practice 
charge alleging that an employer unlawfully instigated or supported a 
petition to displace an incumbent union precludes a question of 
representation because, in those circumstances, the employer has 
improperly circumvented Congress's intent--set forth in Section 
9(c)(1)--to allow employers to file only RM petitions.\59\ That same 
commenter also states that a meritorious unfair labor practice charge 
alleging that an employer violated Section 8(a)(5) by ceasing to 
recognize and bargain with the incumbent union precludes a question of 
representation because displacing the union through an election would 
be inconsistent with the Board's obligation to remediate the Section 
8(a)(5) violation with a bargaining order.\60\ Finally, the commenter 
states that a meritorious unfair labor practice charge against an 
employer that caused the union's loss of majority support precludes a 
question of representation because the required showing of interest 
would be supported by coerced evidence.\61\ Relatedly, another 
commenter states that, where certain unlawful conduct has been 
committed, conducting elections would be a betrayal of the Board's 
statutory responsibility.\62\
---------------------------------------------------------------------------

    \58\ Comments of AFL-CIO; Workers United, SEIU; Communication 
Workers of America, AFL-CIO (CWA).
    \59\ Comment of Workers United.
    \60\ Id.
    \61\ Id.
    \62\ Comment of Economic Policy Institute (EPI). Another 
commenter contends that processing a representation petition where 
there is an unfair labor practice allegation that previously would 
have blocked an election would violate the First and Fourteenth 
Amendments to, and the Take Care Clause of, the U.S. Constitution, 
and that it also raises separation-of-powers concerns. See Comment 
of National Nurses United (NNU) (citing Thomas v. Collins, 323 U.S. 
516 (1945)). This commenter does not explain its argument, and the 
cited decision does not support the commenter's claim. Thus, we 
reject this claim as unsupported.
---------------------------------------------------------------------------

    Several commenters assert various ways in which holding an election 
in spite of a blocking-charge request would harm employees voting in 
the election. In this connection, commenters contend that, after 
employees have been coerced to vote against the union in an initial 
election that has been set aside based on conduct subject to the 
blocking charge, the union will be forced to convince them to change 
their minds in a rerun election.\63\ One commenter states generally 
that pollsters and statisticians who study cognitive biases have shown 
the long-term effect of coercive behavior.\64\ Another commenter 
asserts that it is unfair to hold an election while employees do not 
know whether the unfair labor practice charge has merit.\65\ 
Additionally, several commenters express concerns that having employees 
vote in elections that are set aside will engender a belief that 
exercising rights under the Act is futile, or that Board elections are 
somehow fixed.\66\ Other commenters contend that holding an election 
while the unfair labor practice charge is pending creates an impression 
that the charge necessarily lacks merit, based on the belief that the 
Board would not spend the time, money, and other resources on an 
initial election if it believes that it might need to hold a rerun 
election.\67\ Another commenter states that the Supreme Court 
recognized in NLRB v. Gissel Packing Co., 395 U.S. at 575, that 
employees cannot ``freely determine whether they desire a 
representative'' where the employer has committed unfair labor 
practices that undermined the union's support and impeded the holding 
of a free and fair election.\68\ Some commenters complain that the 
proposed rule provides for holding an election even if an employer has 
engaged in egregious misconduct, such as threatening to shoot any 
employee voting for union representation.\69\
---------------------------------------------------------------------------

    \63\ Comments of SEIU; AFL-CIO; Kimberly Holdiman; NNU; United 
Association of Journeymen and Apprentices of the Plumbing and Pipe 
Fitting Industry of the United States and Canada, AFL-CIO (UA); 
American Federation of Teachers, AFL-CIO (AFT); CWA; Utility Workers 
of America, AFL-CIO (UWUA).
    \64\ Comment of International Union of Operating Engineers 
(IUOE).
    \65\ Comment of Jay Youngdahl.
    \66\ Comments of SEIU; UFCW; UA; LIUNA Mid-Atlantic Regional 
Organizing Coalition (LIUNA MAROC).
    \67\ Comments of CWA; Senator Murray.
    \68\ Comment of International Brotherhood of Electrical Workers, 
AFL-CIO, CLC (IBEW).
    \69\ Comments of SEIU; IUOE; Michigan Regional Council of 
Engineers and Millwrights (MRCC); Senator Murray.
---------------------------------------------------------------------------

    Commenters also assert that it would be an arbitrary waste of 
agency and party resources to conduct elections that will have to be 
invalidated, such as where the employer indisputably assisted with or 
actually solicited petition signatures.\70\ And other commenters argue 
that conducting an election will not serve any purpose because a union 
would not be certified or decertified any sooner. Votes will remain 
impounded until resolution of the pending blocking-charge 
allegations.\71\
---------------------------------------------------------------------------

    \70\ Comments of AFL-CIO; NNU; UFCW; UA; IBEW; AFT; Senator 
Murray; American Federation of State, County and Municipal Employees 
(AFSCME); EPI.
    \71\ Comments of AFL-CIO; Youngdahl; LIUNA MAROC.
---------------------------------------------------------------------------

    Several commenters also assert that the proposed modification of 
blocking-charge policy is not supported by empirical data under the 
current policy that would be relevant to a determination of how many 
blocking charges were meritorious.\72\ Commenters also criticize 
inaccuracies in statistics cited by the Board majority in the NPRM with 
respect to the number of cases where petitions have been blocked and 
the length of time they were blocked under the current policy.\73\ Some 
commenters state that the Board has failed to consider statistics 
showing that evidentiary requirements implemented in the 2015 Election 
Rule have sufficiently addressed any concerns about the current 
blocking-charge policy.\74\ Finally, some commenters contend that the 
Board's concern about election delay resulting from the blocking-charge 
policy is inconsistent with the election delays that will result when 
the 2019 Election Rule takes effect.\75\
---------------------------------------------------------------------------

    \72\ Comments of AFL-CIO; IUOE; LIUNA MAROC; Senator Murray; 
SEIU; UA; UFCW.
    \73\ Comments of AFL-CIO; AFT; IBEW; MRCC; SEIU; UA; UFCW.
    \74\ Comments of AFSCME; AFL-CIO; CWA; IBEW; Youngdahl; UFCW; 
Professor Alexia Kulwiec.
    \75\ Comments of AFT; EPI; SEIU, Local 32BJ (Local 32BJ); UFCW; 
UWUA; Professor Kulwiec.
---------------------------------------------------------------------------

    Having thoroughly considered the foregoing comments, we agree with 
those who contend that the current blocking-charge policy must be 
modified to provide for the timely processing of an otherwise valid 
petition, at least to the point of conducting an election. We remain of 
the view expressed in the NPRM that this approach ``best satisfies the 
goal of protecting employee free choice . . . by assuring that 
petitions will be processed to an election in the same timely manner as 
in unblocked[-]petition cases.'' 84 FR at 39938. Accordingly, the 
final-rule amendment provides that a blocking-charge request will no 
longer delay the conduct of an election in any case. As discussed in 
the following

[[Page 18376]]

section, however, we also agree with comments suggesting that the vote-
and-impound procedure proposed in the NPRM need only apply to a limited 
class of charges and that in all other cases votes should be counted 
upon conclusion of the voting.
    Initially, we disagree with the contention, advanced by several 
commenters opposing the proposed rule, that the Board lacks the 
statutory authority to direct elections in the face of some, or even 
all, blocking charges. Section 9(c)(1) provides that the Board ``shall 
direct an election'' if it finds that ``a question of representation 
exists.'' It makes no reference to the effect of a pending unfair labor 
practice charge on an otherwise valid election petition. Similarly, the 
Board's current election rules, implemented in 2015, state that ``[a] 
question of representation exists if a proper petition has been filed 
concerning a unit in which an individual or labor organization has been 
certified or is being currently recognized by the employer as the 
bargaining representative.'' 29 CFR 102.64(a).\76\ Consistent with this 
definition, the existence of a question concerning representation is 
not per se affected by the pendency of a charge alleging conduct that, 
if proven, would interfere with employee free choice in the election. 
If it were, then the Board would lack the discretion to direct an 
election if such charges were pending, regardless of whether a request 
to block has been made--a position wholly at odds with the Board's 
longstanding procedures, which allow elections to take place despite 
the pendency of charges in certain circumstances, even Type II 
charges.\77\ Indeed, longstanding Board procedures permit the 
processing of a petition and conduct of an election at the discretion 
of the charging party who files an unfair labor practice charge or at 
the discretion of the regional director upon consideration of whether 
circumstances permit an election in spite of pending charges.\78\
---------------------------------------------------------------------------

    \76\ The Board's 2019 Election Rule revisions to its existing 
election rules relevantly state: ``A question of representation 
exists if a proper petition has been filed concerning a unit 
appropriate for the purpose of collective bargaining or concerning a 
unit in which an individual or labor organization has been certified 
or is being currently recognized by the employer as the bargaining 
representative.'' 84 FR 69524, at 69593 (December 18, 2019) (to be 
codified at 29 CFR 102.64(a)). The minor differences between the 
2015 and 2019 rules do not affect our analysis of the issues 
presented here.
    \77\ Type II Blocking Charges are charges that affect the 
petition or showing of interest, that condition or preclude a 
question concerning representation, or that taint an incumbent 
union's subsequent loss of majority support. NLRB Casehandling 
Manual (Part 2) Representation Proceedings Sec. 11730.3 (Jan. 2017).
    \78\ See NLRB Casehandling Manual (Part 2) Representation 
Proceedings Sec. 11731.2, .5, and .6. We note that our final-rule 
amendment of blocking-charge policy does not alter current law 
requiring that allegations that the individual filing a 
decertification petition is a supervisor raise jurisdictional issues 
that must be resolved in the representation case before an election 
may be directed. See Modern Hard Chrome Service Co., 124 NLRB 1235, 
1236-1237 (1959).
---------------------------------------------------------------------------

    Turning to the fundamental issue whether any of the unproven unfair 
labor practice charges currently described as Type I and II charges in 
the Board's Casehandling Manual (Part 2) Representation Proceedings 
should be allowed to block the immediate processing of a petition and 
conduct of an election, we agree with the commenters who contend that, 
in some cases, meritless unfair labor practice charges are filed to 
prevent employees from exercising their right to vote. As some 
commenters note, ending the policy of blocking elections reduces the 
incentives for filing meritless unfair labor practice charges and the 
uncertainty as to whether employees would ever have the opportunity to 
vote.\79\ At the very least, as one commenter noted, it would prompt 
unions to think twice before filing meritless unfair labor practice 
charges because they would not be able to unnecessarily deprive 
employees of their right to express their free choice.\80\
---------------------------------------------------------------------------

    \79\ Comments of CDW; the Chamber.
    \80\ Comment of the Chamber.
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    Further, as discussed in the NPRM, several federal appellate courts 
have expressed concerns about the impact of meritless unfair labor 
practice charges blocking elections. See NLRB v. Hart Beverage Co., 445 
F.2d at 420 (``[I]t appears clearly inferable to us that one of the 
purposes of the [u]nion in filing the unfair practices charge was to 
abort [r]espondent's petition for an election, if indeed, that was not 
its only purpose.''); Templeton v. Dixie Color Printing Co., 444 F.2d 
at 1069 (``The short of the matter is that the Board has refused to 
take any notice of the petition filed by appellees and by interposing 
an arbitrary blocking[-]charge practice, applicable generally to 
employers, has held it in abeyance for over 3 years. As a consequence, 
the appellees have been deprived during all this time of their 
statutory right to a representative `of their own choosing' to bargain 
collectively for them, 29 U.S.C. 157, despite the fact that the 
employees have not been charged with any wrongdoing. Such practice and 
result are intolerable under the Act and cannot be countenanced.''); 
NLRB v. Midtown Service Co., 425 F.2d at 672 (``If . . . the charges 
were filed by the union, adherence to the [blocking-charge] policy in 
the present case would permit the union, as the beneficiary of the 
[e]mployer's misconduct, merely by filing charges to achieve an 
indefinite stalemate designed to perpetuate the union in power. If, on 
the other hand, the charges were filed by others claiming improper 
conduct on the part of the [e]mployer, we believe that the risk of 
another election (which might be required if the union prevailed but 
the charges against the [e]mployer were later upheld) is preferable to 
a three-year delay.''); NLRB v. Minute Maid Corp., 283 F.2d at 710 
(``Nor is the Board relieved of its duty to consider and act upon an 
application for decertification for the sole reason that an unproved 
charge of an unfair practice has been made against the employer. To 
hold otherwise would put the union in a position where it could 
effectively thwart the statutory provisions permitting a 
decertification when a majority is no longer represented.''); Pacemaker 
Corp v. NLRB, 260 F.2d at 882 (``The practice adopted by the Board is 
subject to abuse as is shown in the instant case. After due notice both 
parties proceeded with the representation hearing. Possibly for some 
reasons of strategy near the close of the hearing, the [u]nion asked 
for an adjournment. Thereafter it filed a second amended charge of 
unfair labor practice. By such strategy the [u]nion was able to and did 
stall and postpone indefinitely the representation hearing.'').
    We believe that it would be inappropriate for the Board to continue 
to disregard these valid concerns that the current blocking-charge 
policy encourages such gamesmanship, allowing unions to dictate the 
timing of an election for maximum advantage in all elections presenting 
a test of representative status.\81\ The Board has long been aware of 
the potential--and actuality--of such gamesmanship and has taken 
certain measures to discourage it. Section 11730 of the Board's current 
Casehandling Manual for representation proceedings states that ``it 
should be recognized that the policy is not intended to be misused by a 
party as a tactic to delay the resolution of a question concerning 
representation raised by a petition.'' Further, while declining to 
modify the blocking-charge

[[Page 18377]]

policy in the 2015 Election Rule, the Board did state that it was 
``sensitive to the allegation that at times, incumbent unions may abuse 
the policy by filing meritless charges in order to delay 
decertification elections,'' \82\ and it sought to address that issue 
by including a provision in Sec.  103.20 of the Board's Rules and 
Regulations requiring that a charging party that files a blocking 
request must simultaneously provide an offer of proof with names of 
witnesses and a summary of their anticipated testimony.
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    \81\ As comments make clear, the discretionary ability of a 
union to affect the timing of an election through a blocking charge 
exists not only for decertification election (RD) and 
deauthorization (UD) petitions filed by individual employees, but 
also for representation-election petitions filed by a union (RC) or 
employer (RM).
    \82\ 79 FR at 74419.
---------------------------------------------------------------------------

    We agree that this new evidentiary requirement would likely 
facilitate the quick elimination of obviously meritless charges and 
blocking requests based on them, and thereby permit processing of some 
petitions with minimal delay. We also accept as plausible the 
contention by some commenters that the requirement may be partly 
responsible for a decline in blocked petitions since implementation of 
the 2015 Election Rule.\83\ But even assuming the decline is, to some 
extent, attributable to the offer-of-proof requirement, we nevertheless 
find that this decline alone does not justify adherence to the current 
blocking-charge policy. A regional director typically acts on a 
blocking-charge request soon after the request is made, if not on the 
same day, and a charge that appears facially sufficient based on an 
offer of proof may yet be dismissed as meritless after full 
investigation or may ultimately be withdrawn. Meanwhile, under the 
current policy, an election is delayed until that happens.
---------------------------------------------------------------------------

    \83\ The statistical summary from Professor John-Paul Ferguson 
appended to the Comment of AFL-CIO shows a decline but proves no 
certain basis for inferring the cause of decline.
---------------------------------------------------------------------------

    Further, our concerns and those expressed by commenters about the 
current policy extend to meritorious charges as well. Proponents of the 
current policy take a broad view of what constitutes a meritorious 
blocking charge. They would include any charge under investigation by 
the regional director that is not facially meritless and alleges 
conduct that could reasonably affect the election results or the 
validity of the election petition. Necessarily, then, they would 
include any charge on which a regional director decides to issue a 
complaint, regardless of whether a violation of the Act would 
ultimately be proven. Based on comments supportive of the dissent's 
statistical survey in the NPRM, they would also define as meritorious 
any blocking charge that resulted in a settlement, without inquiry into 
the terms of the settlement agreement.\84\ In other words, they view 
any charge of conduct potentially affecting the validity of a petition 
or the outcome of an election as presumptively meritorious, for 
purposes of blocking an election, until it is dismissed or withdrawn. 
This view stands in sharp contrast to the Board's, for which a charge 
is not meritorious unless admitted or so found in litigation. Thus, 
from the Board's perspective, the current blocking-charge practice 
denies employees supporting a petition the right to have a timely 
election based on charges the merits of which remain to be seen, and 
many of which will turn out to have been meritless. Moreover, even 
assuming that some commenters are correct that for every meritless 
charge there are two ``meritorious'' charges that have appropriately 
blocked an election,\85\ this does not justify the very real 
consequences that employees experience when unfair labor practice 
charges indefinitely delay their ability to vote.
---------------------------------------------------------------------------

    \84\ See List of FY 2016 and FY 2017 Petitions Blocked Pursuant 
to Blocking Charge Policy in Dissent Appendix, https://www.nlrb.gov/sites/default/files/attachments/basic-page/node-7583/member-mcferran-dissent-appendix.pdf (last visited Mar. 23, 2020).
    \85\ Comments of Workers United; AFL-CIO; IUOE; UFCW; Senator 
Murray.
---------------------------------------------------------------------------

    We also acknowledge the claims in the dissent to the NPRM and by 
some commenters that there were errors in some of the data that the 
NPRM majority cited to support the proposed rule and that these errors 
led to exaggeration both of the number of cases delayed and the length 
of delay involved.\86\ Even accepting those claims as accurate, the 
remaining undisputed statistics substantiate the continuing existence 
of a systemic delay that supports our policy choice to modify the 
current blocking-charge procedure that does not, and need not, depend 
on statistical analysis. As the AFL-CIO candidly acknowledges, 
``[b]locking elections delays elections. That is undeniably true and 
requires no `statistical evidence' to demonstrate.'' We agree. 
Furthermore, anecdotal evidence of lengthy blocking-charge delays in 
some cases, and judicial expressions of concern about this, remain 
among the several persuasive reasons supporting a change that will 
assure the timely conduct of elections without sacrificing protections 
against election interference.
---------------------------------------------------------------------------

    \86\ Comments of Workers United; AFL-CIO; IBEW; AFT; UA; UFCW; 
MRCC.
---------------------------------------------------------------------------

    For instance, in Cablevision Systems Corp., 367 NLRB No. 59, 
employees were forced to wait years for a regional director to process 
a decertification petition because of a blocking charge--so long, in 
fact, that the employee who filed the petition ultimately withdrew it 
and the employees were denied the right to vote. That case was by no 
means an anomaly. In ADT Security Services, No. 18-RD-206831, 2017 WL 
6554381 (Dec. 20, 2017), the petitioner filed a decertification 
petition after personally gathering the required showing of interest. 
The union filed a blocking charge falsely alleging employer 
involvement. Although the union eventually withdrew its frivolous 
charge, it succeeded in blocking an election for several months.\87\ 
Likewise, in Arizona Public Service Co., No. 28-RD-194724, 2017 WL 
2794208 (June 27, 2017), the petitioner filed a decertification 
petition with the required showing of interest. The union filed a 
blocking charge alleging employer involvement. The union eventually 
withdrew the charge and lost the subsequent election but was successful 
in delaying its ouster for nearly 3 months.\88\ Additionally, in 
Pinnacle Foods Group, LLC, No. 14-RD-226626, 2019 WL 656304 (Feb. 2, 
2019), the petitioner filed a decertification petition supported by the 
requisite showing of interest. The union filed a charge alleging 
employer involvement and the employer's failure to meet its bargaining 
obligations. The region immediately blocked the petition without 
seeking any input from the employer or the petitioner. Although the 
region eventually issued a complaint on relatively minor violations of 
the Act, it dismissed the allegations of employer involvement in 
soliciting support for the decertification petition. Under the 
blocking-charge policy, the regional director declined to process the 
decertification petition, even though it was filed 18 months after the 
union's certification and 12 months after the parties began 
bargaining--but only days after the decertification petition was filed, 
suggesting that its primary purpose was merely to forestall the 
decertification election.\89\ Then, one commenter asserts, there is the 
case of the employees at Apple Bus Co. in Soldotna, Alaska, who were 
forced to wait years for a decertification election because of blocking 
charges until the union ultimately disclaimed interest in continuing 
representation.\90\
---------------------------------------------------------------------------

    \87\ See Comment of NRWLDF.
    \88\ See id.
    \89\ Id.
    \90\ Id. (citing Apple Bus Co., Case 19-RD-216636, 2019 WL 
7584368 (Nov. 18, 2019)).
---------------------------------------------------------------------------

    Cases such as these demonstrate how a blocking charge can postpone 
an election, even for years, seriously

[[Page 18378]]

harming the interests of employees who wanted it. Although some 
commenters assert that blocking charges are not to blame for the 
unacceptably lengthy delay of elections in certain cases,\91\ it is 
undisputed that blocking charges delay elections. In this regard, it 
takes time for the General Counsel to investigate a charge and, on 
occasion, to litigate a complaint based on the charge.\92\ We believe 
that it is our obligation to prevent this needless delay of employees' 
exercise of their right to express their free choice regarding union 
representation in a timely held election.
---------------------------------------------------------------------------

    \91\ Comments of AFL-CIO; UA.
    \92\ Comment of CDW.
---------------------------------------------------------------------------

    Additionally, we believe that the concerns raised about the harm 
that employees would suffer by voting in an election that is later set 
aside are overstated and can be addressed by the prophylactic post-
election procedures of certification stays and, in some cases, 
impounding ballots, set forth in the final rule. We also note that from 
the Board's earliest years, it has set aside the results of elections 
based on meritorious objections and has ordered second elections. See, 
e.g., Paragon Rubber Co., 7 NLRB 965, 966 (1938). In many of those 
cases, the objectionable conduct was an unfair labor practice. Based on 
our extensive experience in handling election objections, we reject the 
notion that employee free choice in a second election will invariably 
be affected by a prior election loss set aside based on unfair labor 
practices. That has not been the case in many rerun elections where 
employees vote for union representation in a second or even third 
election. In fact, contrary to the suggestion of some commenters, we 
believe that when the Board orders a second election based on unfair 
labor practices committed during the critical pre-election period, that 
sends a positive signal to employees that the Board will protect their 
free choice when the results of an actual election require doing so. In 
addition, the Board holds rerun elections only at an appropriate time 
after the original election is set aside--i.e., after the effects of 
the unlawful or objectionable conduct have dissipated.\93\ We also note 
that nothing in the Supreme Court's Gissel decision suggests the 
inevitability of lingering effects preventing a fair rerun election, 
much less that an election should be delayed or preempted prior to any 
finding in adjudication that unfair labor practices have actually been 
committed. To the contrary, that decision makes clear the Court's 
implicit view that typically, fair elections can be held after an 
employer has undisputedly committed unfair labor practices. A rerun 
election remains the norm after a first election has been set aside 
based on such misconduct. The extraordinary alternative of imposing an 
affirmative bargaining order is warranted only when standard remedies 
stand no or only a slight chance of ameliorating the lingering effects 
of adjudicated serious unfair labor practices.\94\
---------------------------------------------------------------------------

    \93\ One commenter's claim that a federal district court in 
Amirault v. Shaughnessy, No. H-84-113, 1984 WL 49161, at *4 (D. 
Conn. Feb. 8, 1984), issued a temporary restraining order to halt a 
union-affiliation election under the Labor Management Reporting and 
Disclosure Act (LMRDA) because of what it speculated would be the 
harmful effect of that election on any subsequent election has no 
bearing on the issue here. That case not only is inapposite based on 
its facts--which involved the effect of union-affiliation opponents 
being denied the opportunity under the LMRDA to present their views 
before the holding of a special convention vote--but it also was 
reversed by the court of appeals, reported at 794 F.2d 676 (2d Cir. 
1984) (table). See Reply Comment of AFL-CIO.
    \94\ See NLRB v. Gissel Packing Co., supra, 395 U.S. at 610-616.
---------------------------------------------------------------------------

    One commenter notes that, if an election is held but votes are 
impounded, the workforce may change by the time the election results 
are certified.\95\ As discussed below, our final-rule amendment retains 
the proposed vote-and-impound procedure for only a limited category of 
cases, but certification will in any event be postponed for some period 
of time if a blocking charge is still pending when an election 
concludes. In any event, the commenter's observation misses the 
critical point that our concern is with the harmful effects on employee 
free choice of election delay, rather than with any post-election delay 
until a certification of results or representative issues. For various 
reasons previously stated, blocking charges should neither prevent the 
timely processing of an otherwise valid petition nor preclude those 
employees who support it from participating in a timely-conducted 
election. Considering these factors, we disagree with one commenter's 
argument that we should maintain the status quo--and its attendant, 
unnecessary delay in employees' exercise of free choice--because that 
delay ``is a small price to pay.'' \96\ We find instead that it is far 
too great a price for employees to pay.
---------------------------------------------------------------------------

    \95\ Comment of AFSCME.
    \96\ Comment of Youngdahl.
---------------------------------------------------------------------------

    As stated above, several commenters allege that our expressed 
concern about election delay resulting from the current blocking-charge 
policy is inconsistent with the 2019 Election Rule.\97\ They claim that 
we cannot seriously be concerned about preventing unnecessary delays in 
the election process because we provided in that rulemaking for pre-
election review of unit-scope and voter-eligibility issues. Implicit in 
this argument is an assumption that the changes made by that final rule 
institutionalized ``unnecessary'' delays. We could not disagree more. 
As stated in response to the dissent to that rule, the amendments made 
there were based on the belief that ``the expedited processes 
implemented in 2014 at every step of the election process . . . 
unnecessarily sacrificed prior elements of Board election procedure 
that better assured a final electoral result that is fundamentally 
fairer and still provides for the conduct of an election within a 
reasonable period of time from the filing of a petition.'' 84 FR at 
69577. In contrast, the changes that the final rule here makes in the 
blocking-charge policy do address unnecessary delay in the conduct of 
an election without sacrificing safeguards against unfair labor 
practice charges that might affect the election results. Further, in at 
least some cases, the delay involved in blocking an election has been 
months or years, far exceeding the additional days or weeks added to 
the election processing timeframe by the 2019 Election Rule.
---------------------------------------------------------------------------

    \97\ Comments of SEIU; EPI; Local 32BJ.
---------------------------------------------------------------------------

    Some commenters assert that eliminating the policy of blocking 
elections based on pending charges may force the Board to expend 
additional resources in holding second elections that would not be 
necessary if initial elections are delayed. We do not consider this to 
be a waste by any means, and any consequential costs are worth the 
benefits secured. Preliminarily, it is clearly not the case that unfair 
labor practices alleged in a charge, even if meritorious, will 
invariably result in a vote against union representation. If the union 
prevails despite those unfair labor practices, there will be no second 
election. In any event, one of the principal duties of the Board is to 
resolve questions of representation by holding elections, and that duty 
is not discharged where the Board does not process a representation 
petition, especially where there is no legitimate basis for delaying an 
election.\98\ As the General Counsel has stated, ``any burden on the 
Regions in conducting elections where the ballots may never be counted 
is outweighed by the critical benefit of ensuring employee free 
choice.''\99\
---------------------------------------------------------------------------

    \98\ Comment of CDW.
    \99\ Comment of GC Robb.

---------------------------------------------------------------------------

[[Page 18379]]

    For the foregoing reasons (and those discussed in the NPRM), we 
continue to believe that revising the blocking-charge policy to end the 
practice of delaying an election represents a more appropriately 
balanced approach to the issue of how to treat election petitions when 
relevant unfair labor practice charges are pending. It ensures that 
employees are able to express their preference for or against union 
representation in a timely held Board election, while maintaining 
effective means for addressing election interference. This is an 
outcome that we believe we can, and should, guarantee for every 
employee covered under the Act, while at the same time imposing minimal 
burden on the parties to an election and, just as importantly, the 
employees who vote in those elections.
2. Comments Regarding Other Alternatives
    Several commenters contend that there are adequate existing 
alternatives that make it unnecessary to abolish the blocking-charge 
policy.
    Some commenters observe that regional directors already have 
discretion to decide to process a petition despite a pending unfair 
labor practice charge.\100\ One commenter states that variation in the 
exercise of such discretion is to be expected as a consequence of what 
the commenter characterizes as a law-enforcement context of a 
prosecutorial determination of merit in the blocking charge.\101\ 
Commenters suggest that, as an alternative to proceeding to an election 
but impounding the ballots (or delaying the certification), the Board 
could grant greater discretion to regional directors.\102\
---------------------------------------------------------------------------

    \100\ Comments of SEIU; Professor Kulwiec.
    \101\ Comment of IUOE.
    \102\ See, e.g., Comments of IUOE; CWA.
---------------------------------------------------------------------------

    However, one commenter contends that currently, some regional 
directors reflexively block elections in cases where unfair labor 
practice charges are filed, even when the underlying offer of proof is 
weak and the charges are patently frivolous, minor, and/or false.\103\ 
And one commenter asserts that regional directors act arbitrarily in 
determining which types of charges should block an election by, for 
instance, largely ignoring the election-related effects of unfair labor 
practices committed by unions.\104\ Further, one commenter notes the 
substantial inconsistency that already exists across regions, and 
argues that the opportunity to vote in a timely-conducted election 
should not depend on employees' geographic locations.\105\
---------------------------------------------------------------------------

    \103\ Comment of NRWLDF.
    \104\ Id.
    \105\ Comment of CDW.
---------------------------------------------------------------------------

    As reflected in these comments, and as discussed in the NPRM, 
concerns have been raised about regional directors not applying the 
current blocking-charge policy consistently, thereby creating 
uncertainty and confusion about when, if ever, parties can expect an 
election to occur. See Zev J. Eigen & Sandro Garofalo, Less Is More: A 
Case for Structural Reform of the National Labor Relations Board, 98 
Minn. L. Rev. 1879 at 1896-1897 (``Regional directors have wide 
discretion in allowing elections to be blocked, and this sometimes 
results in the delay of an election for months and in some cases for 
years--especially when the union resorts to the tactic of filing 
consecutive unmeritorious charges over a long period of time. This is 
contrary to the central policy of the Act, which is to allow employees 
to freely choose their bargaining representative, or to choose not to 
be represented at all.'').
    We do not believe that granting broader discretion to regional 
directors is a preferable alternative to eliminating altogether the 
policy of blocking an election based on an unfair labor practice 
charge. As one commenter notes, the Board is entrusted with setting 
national labor policy, and it would better fulfill that duty by 
creating a uniform election schedule, notwithstanding any pending 
unfair labor practice charges, than by giving regional directors even 
more discretion to decide whether employees should have a timely 
opportunity to vote in an election.\106\ As another commenter states, 
the more that employees are left in the dark as to when--much less 
whether--they will be able to vote, the further deprived they are of 
laboratory conditions.\107\
---------------------------------------------------------------------------

    \106\ Comment of the Chamber.
    \107\ Comment of COLLE.
---------------------------------------------------------------------------

    It is because of this need for uniformity that we also decline to 
create an exception, as proposed by one of the commenters, to continue 
to allow an election to be blocked when it is the petitioner who files 
the unfair labor practice charge.\108\ Doing so would preserve the 
opportunity for a petitioner to manipulate the timing of the election 
for maximum advantage. If a petition is filed presenting a question of 
representation, we believe the election should proceed regardless of 
who files the petition, although certification may be delayed while the 
unfair labor practice charge is resolved.
---------------------------------------------------------------------------

    \108\ Comment of AFL-CIO.
---------------------------------------------------------------------------

    Other commenters suggest that the expedited evidentiary requirement 
for blocking charge requests adopted in the 2015 Election Rule is a 
sufficient alternative to the proposed change. In this connection, some 
commenters claim that the Board has not fully studied the effects of 
that Rule, or that we should maintain the status quo for an indefinite 
length of time because of that Rule.\109\ We reject those claims. As 
one commenter suggests, at least some meritless unfair labor practice 
charges are still being filed, notwithstanding the 2015 Election Rule's 
requirement of a submission of a perfunctory offer of proof.\110\ In 
any event, as previously discussed, the offer-of-proof requirement is 
likely to result in prompt dismissal or withdrawal of only the most 
obviously meritless charges. Beyond that, as also discussed, we find 
that the better policy protective of employee free choice is to 
eliminate blocking elections based on any pending unfair labor practice 
charges, even those that may ultimately be found to have merit. 
However, the final rule preserves the evidentiary requirements created 
by the 2015 Election Rule.
---------------------------------------------------------------------------

    \109\ Comments of SEIU; Professor Kulwiec; AFL-CIO; CWA; AFSCME; 
IBEW.
    \110\ Comment of CDW.
---------------------------------------------------------------------------

    Finally, to the extent that the Board's recent decision in Johnson 
Controls, Inc., 368 NLRB No. 20 (2019), addresses our concern about the 
post-contract presumption of union majority support in the face of 
contrary evidence, as one commenter suggests,\111\ that decision is not 
a sufficient alternative to ending the blocking-charge policy. Even 
under Johnson Controls, anticipatory withdrawals based upon evidence of 
employee disaffection could still be as ineffective as the RM-petition 
``safe harbor'' because a union could still file a charge blocking 
employees from getting to vote in an election, while the employer may 
feel compelled to retain the employees' existing terms and conditions 
of employment out of concern that it may otherwise be engaging in 
objectionable conduct.
---------------------------------------------------------------------------

    \111\ Comment of UFCW.
---------------------------------------------------------------------------

3. Modifications to the Proposed Rule and Arguments Regarding 
Settlements
    Some commenters argue that a vote-and-impound procedure for all 
unfair labor practice charges, as proposed in the NPRM, would not 
provide the expected salutary effect that would come from a charging 
party--fully aware of the results of the election--knowing that it was 
acting either with

[[Page 18380]]

the support of or in the teeth of employees' wishes.\112\ In 
particular, as one commenter notes, impoundment of ballots does not 
fully ameliorate the problems with the current blocking-charge policy 
because impoundment fails to decrease a union's incentive to delay its 
decertification by filing meritless blocking charges; makes it more 
difficult for parties to settle blocking charges, as they would not 
know the results of the election during their settlement discussions; 
and further frustrates and confuses employees waiting, possibly for an 
extended post-election period, to learn the results of the 
election.\113\
---------------------------------------------------------------------------

    \112\ Comments of ABC; NRWLDF.
    \113\ Comment of NRWLDF.
---------------------------------------------------------------------------

    After considering those arguments, we agree with commenters who 
state that it would be preferable for ballots to be counted immediately 
after the conclusion of the election, but holding the certification of 
the election results in abeyance pending the resolution of the unfair 
labor practice charge.\114\ Accordingly, the final rule makes that 
change with regard to most categories of unfair labor practice charges.
---------------------------------------------------------------------------

    \114\ Comment of the Chamber.
---------------------------------------------------------------------------

    At the same time, however, some types of unfair labor practice 
charges speak to the very legitimacy of the election process in such a 
way that warrants different treatment--specifically, those that allege 
violations of Section 8(a)(1) and 8(a)(2) or Section 8(b)(1)(A) of the 
Act and that challenge the circumstances surrounding the petition or 
the showing of interest submitted in support of the petition, and those 
that allege that an employer has dominated a union in violation of 
Section 8(a)(2) and that seek to disestablish a bargaining 
relationship. We believe that in cases involving those types of 
charges, it is more appropriate to impound the ballots than to promptly 
count them. Nevertheless, in order to avoid a situation where employees 
are unaware of the election results indefinitely, we believe it is 
appropriate to set an outer limit on how long ballots will be 
impounded. Accordingly, the final rule provides that the impoundment 
will last for only up to 60 days from the conclusion of the election if 
the charge has not been withdrawn or dismissed prior to the conclusion 
of the election, in order to give the General Counsel time to make a 
merit determination regarding the unfair labor practice charge.\115\ We 
believe that this 60-day period will reasonably provide sufficient time 
for the General Counsel to investigate the charge and assess its merits 
without substantially affecting employees' interests in knowing the 
electoral outcome.\116\ Additionally, the final rule specifies that, if 
a complaint issues with respect to the charge during the 60-day period, 
then the ballots shall continue to be impounded until there is a final 
determination regarding the charge and its effects, if any, on the 
election petition. If the charge is found to have merit in a final 
Board determination, we will set aside the election and either order a 
second election or issue an affirmative bargaining order, depending on 
the nature of the violation or violations found to have been committed. 
If the charge is withdrawn or dismissed at any time during the 60-day 
impoundment period, or if the 60-day period ends without a complaint 
issuing, then the ballots shall be promptly opened and counted. The 
final rule also specifies that, if unfair labor practice charges are 
filed serially, the 60-day period will not be extended.
---------------------------------------------------------------------------

    \115\ To the extent that some commenters suggest that we could 
impose an outer limit on the duration of the General Counsel's 
unfair labor practice investigation, we reject those suggestions as 
beyond our authority. The Board retains the authority to determine 
the timing of a representation election and disclosure of the 
results of that election during the investigation of an unfair labor 
practice charge, but the General Counsel has independent authority 
under Sec. 3(d) of the Act to investigate the charge, without any 
limitation on the length of that investigation. See Comments of AFL-
CIO; CWA.
    \116\ We note that the NLRB's 2019 Performance and 
Accountability Report states that in fiscal year 2019, the Agency's 
regional offices processed unfair labor practice charges from filing 
to disposition in a median of 74 days. NLRB, FY 2019 Performance and 
Accountability Report 7, https://www.nlrb.gov/sites/default/files/attachments/basic-page/node-1674/nlrb-par-2019-design-508.pdf (last 
visited Mar. 23, 2020). Moreover, we would expect that 
investigations of charges triggering the vote-and-impound procedure 
could be given priority and conducted expeditiously. These 
considerations further support our conclusion that a 60-day limit on 
the duration of ballot impoundment represents a reasonable 
limitation on employees' interest in learning the outcome of the 
vote.
---------------------------------------------------------------------------

    In our view, these two different procedures--a vote-and-count 
procedure for most categories of charges, and a vote-and-impound 
procedure for some limited categories of charges--best accommodate the 
various concerns that the commenters have raised while protecting the 
rights that we are obligated to safeguard. For that reason, we reject 
the assertion of some commenters that we have not attempted to balance, 
or even quantify, the burden and the benefit in adopting these revised 
procedures.\117\
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    \117\ Comments of AFL-CIO; UFCW.
---------------------------------------------------------------------------

    Finally, we note that we received some comments regarding the 
proposed rule's effects on settlements.\118\ However, the NPRM 
expressly stated that the Board does not intend this rulemaking to 
address other election-bar policies, including the settlement bar. 84 
FR at 39931 fn. 3. Thus, the rule, by its terms, applies to requests to 
block an election with an unfair labor practice charge, and it does not 
apply where a party seeks to interpose a settlement agreement as a bar 
to an election. Further, the types of settlements, and the 
circumstances in which they can be reached, are myriad. For all of 
these reasons, this rule does not address the effect of settlements or 
disturb the Board's case law addressing the effects of various types of 
settlements. Any possible changes in the law on those issues are left 
for other proceedings. Cf. Mobil Oil Expl. & Producing Se. Inc., 498 
U.S. at 231 (``[A]n agency need not solve every problem before it in 
the same proceeding.''); Advocates for Highway & Auto Safety, 429 F.3d 
at 1147 (``Agencies surely may, in appropriate circumstances, address 
problems incrementally.''). We note that, under existing procedures 
that this rule does not disturb, a party that files a request for 
review of a decision and direction of election prior to the election 
may request extraordinary relief in the form of, among other things, 
impoundment of some or all of the ballots. See 29 CFR 102.67(j). Thus, 
there is an existing mechanism that allows a request to keep the 
ballots impounded in appropriate circumstances.
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    \118\ Comments of SEIU; AFL-CIO; Local 32BJ.
---------------------------------------------------------------------------

F. Final-Rule Amendment Regarding Voluntary-Recognition Election Bar

    The Board also received numerous comments on the proposed amendment 
concerning the current immediate voluntary-recognition bar. We have 
carefully reviewed and considered these comments, as discussed below.
1. Comments About Voluntary Recognition Relative to Board Elections
    Two commenters state that voluntary recognition is ``favored,'' 
quoting NLRB v. Broadmoor Lumber Co., 578 F.2d 238, 241 (9th Cir. 
1978).\119\ In addition, one commenter asserts that the Act does not 
create separate bargaining obligations or ``different systems of 
private ordering'' for unions based on whether they achieved their 
status through voluntary recognition or certification.\120\ Further, 
several commenters note that voluntary recognition predated the Act, 
and that the Act created the election process only as a means of 
resolving questions of

[[Page 18381]]

representation when the parties could not resolve them privately.\121\
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    \119\ Comments of Local 32BJ; AFSCME.
    \120\ Comment of UFCW.
    \121\ Comments of IUOE; AFL-CIO; EPI; IBEW; St. Louis-Kansas 
City Carpenters Regional Council.
---------------------------------------------------------------------------

    It is well established that voluntary recognition and voluntary-
recognition agreements are lawful. NLRB v. Gissel Packing Co., 395 U.S. 
at 595-600; United Mine Workers of America v. Arkansas Oak Flooring 
Co., 351 U.S. at 72 fn. 8. However, as several commenters note,\122\ it 
also is well established that Board elections are the Act's preferred 
method for resolving questions of representation.
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    \122\ Comments of GC Robb; CDW; Representatives Foxx and 
Walberg; NRWLDF; CNLP.
---------------------------------------------------------------------------

    As an initial matter, the Act itself implicitly supports this 
principle. As some commenters note, unlike the election bar, the 
voluntary-recognition bar is not in the Act; it is a Board-created 
doctrine.\123\ Further, the 1947 Taft-Hartley amendments to Section 9 
of the Act limited Board certification of exclusive collective-
bargaining representatives--and the benefits that result from 
certification \124\--to unions that prevail in a Board election. While 
the Act's text does not state an explicit preference for Board 
elections, the election-year bar and the greater statutory protections 
accorded to a Board-certified bargaining representative implicitly 
reflect congressional intent to encourage the use of Board elections as 
the preferred means for resolving questions concerning representation.
---------------------------------------------------------------------------

    \123\ Comments of NRWLDF; COLLE; CDW.
    \124\ Those benefits include a 12-month bar to election 
petitions under Sec. 9(c)(3) as well as to withdrawal of 
recognition; protection against recognitional picketing by rival 
unions under Sec. 8(b)(4)(C); the right to engage in certain 
secondary and recognitional activity under Sec. 8(b)(4)(B) and 7(A); 
and, in certain circumstances, a defense to allegations of unlawful 
jurisdictional picketing under Sec. 8(b)(4)(D).
---------------------------------------------------------------------------

    Additionally, both the Board and the courts have long recognized 
that secret-ballot elections are better than voluntary recognition at 
protecting employees' Section 7 freedom to choose, or not choose, a 
bargaining representative. See, e.g., Linden Lumber Div. v. NLRB, 419 
U.S. 301, 304 (1974); NLRB v. Gissel Packing Co., 395 U.S. at 602; 
Transp. Mgmt. Servs. v. NLRB, 275 F.3d 112, 114 (D.C. Cir. 2002); NLRB 
v. Cayuga Crushed Stone, Inc., 474 F.2d 1380, 1383 (2d Cir. 1973); 
Levitz Furniture Co. of the Pacific, 333 NLRB at 727; Underground 
Service Alert, 315 NLRB 958, 960 (1994). As the United States Supreme 
Court has stated, ``secret elections are generally the most 
satisfactory--indeed the preferred--method of ascertaining whether a 
union has majority support.'' NLRB v. Gissel Packing Co., 395 U.S. at 
602. Although voluntary recognition is a valid method of obtaining 
recognition, authorization cards used in a card-check recognition 
process are ``admittedly inferior to the election process.'' Id. at 
603.
    As several commenters note, the Board takes prophylactic measures 
to ensure a free and fair ballot in elections that it conducts (e.g., 
requiring posting election notices at least 3 days beforehand).\125\ 
Further, as some commenters note, because the Board does not supervise 
voluntary recognitions, it generally cannot know whether an employer-
recognized union has the uncoerced support of a majority of 
employees.\126\ Unlike votes cast in private during Board-conducted 
secret-ballot elections, card signings are public actions, susceptible 
to group pressure exerted at the moment of choice. Even if such 
pressure is not unlawfully coercive, it warrants consideration in 
determining the reliability of an employee's choice. As several 
commenters note, employees may sign cards because they are susceptible 
to peer pressure or do not want to appear nonconformist or 
antagonistic.\127\ See, e.g., NLRB v. Village IX, Inc., 723 F.2d 1360, 
1371 (7th Cir. 1983) (``Workers sometimes sign union authorization 
cards not because they intend to vote for the union in the election but 
to avoid offending the person who asks them to sign, often a fellow 
worker, or simply to get the person off their back, since signing 
commits the worker to nothing (except that if enough workers sign, the 
employer may decide to recognize the union without an election).''). Of 
course, as several commenters also note, signatures on authorization 
cards may be the result not merely of peer pressure, but of threats, 
intimidation, coercion, harassment, or other conduct that falls far 
short of the ``laboratory conditions'' the Board seeks to ensure during 
elections.\128\ Absent an electoral option, the only way for an 
employee to address this conduct would be to file an unfair labor 
practice charge, with the prospect of an extended investigation and 
litigation period to follow, during which the challenged bargaining 
relationship would continue.
---------------------------------------------------------------------------

    \125\ E.g., Comment of COLLE.
    \126\ E.g., Comments of NRWLDF; CDW.
    \127\ Comments of COLLE; CDW; GC Robb; the Chamber.
    \128\ Comments of NRWLDF; GC Robb; Representatives Foxx and 
Walberg; the Chamber. See also Reply Comment of CNLP.
---------------------------------------------------------------------------

    Further, as some commenters note, employees often sign cards due to 
misunderstandings, misrepresentations, or lack of information about the 
consequences of unionization.\129\ Moreover, as one commenter notes, a 
card check often is accompanied by formal or informal employer 
neutrality, which may effectively deprive employees of any exposure to 
information or argument that might cause them to decline 
representation.\130\
---------------------------------------------------------------------------

    \129\ Comments of NRWLDF; the Chamber.
    \130\ Comment of CDW.
---------------------------------------------------------------------------

    Some commenters claim that there is no evidence to support these 
contentions.\131\ Relatedly, one commenter claims that workers do not 
obtain more accurate information during Board election campaigns than 
they do during voluntary-recognition efforts.\132\ However, the 
``uninhibited, robust, and wide-open debate'' characteristic of a 
Board-conducted election better fulfills the national labor policy that 
Congress has established. See Chamber of Commerce of U.S. v. Brown, 554 
U.S. 60, 68 (2008) (NLRA preempted state law restricting use of state 
funds to assist, promote, or deter union organizing).
---------------------------------------------------------------------------

    \131\ Comments of IUOE; Local 32BJ.
    \132\ Comment of Local 32BJ.
---------------------------------------------------------------------------

    Another advantage of a Board election is that it presents a clear 
picture of employee voter preference at a single moment. As some 
commenters note,\133\ elections provide a ``snapshot in time'' while 
card signings may take place over a period of time, during which 
employee sentiment can change. See, e.g., Johnson Controls, Inc., 368 
NLRB No. 20 (six employees signed union authorization cards shortly 
after signing decertification petition); Alliant Food Service, 335 NLRB 
695 (2001) (16 employees who signed cards for 1 union subsequently 
signed cards for another union).
---------------------------------------------------------------------------

    \133\ Comments of CDW; GC Robb.
---------------------------------------------------------------------------

    According to one commenter, the fact that an election takes place 
at a single moment disenfranchises employees who are absent on the day 
of an election.\134\ But, as the General Counsel notes, some employees 
may be completely unaware of an organizing effort prior to a voluntary 
recognition because a union needs signatures from only a majority of 
the unit.\135\ It is not unreasonable to conclude that if a union knows 
or suspects which employees may be inclined to support it, the union 
may target those employees to sign cards while avoiding employees 
perceived to be less sympathetic to the union's efforts. In contrast, 
all unit employees receive advance notice of the opportunity to vote in 
a Board-conducted representation election. In

[[Page 18382]]

agreement with the General Counsel, we believe that employees who would 
otherwise be left in the dark regarding a voluntary-recognition drive 
should have the opportunity to campaign and vote against representation 
or in favor of a different union \136\--even if that means that 
employees who are absent on the day of the election (for which they 
receive advance notice) are unable to vote.\137\
---------------------------------------------------------------------------

    \134\ Comment of Local 32BJ.
    \135\ Comment of GC Robb.
    \136\ Id.
    \137\ Moreover, as noted in NLRB Casehandling Manual (Part 2) 
Representation Proceedings Sec. 11302 (Jan. 2017), election-
scheduling details ``are ordinarily based upon the parties' 
voluntary meeting of the minds (with the regional director's 
approval), as reflected in an election agreement.'' In the event the 
regional director has to determine this matter, the manual provides 
that ``[w]here there is a choice, the regional director should avoid 
scheduling the election on dates on which all or part of the 
facility will be closed, on which past experience indicates that the 
rate of absenteeism will be high, or on days that many persons will 
be away from the facility on company business or on vacation.'' In 
either event, the procedures aim to minimize as much as possible the 
disenfranchisement of employees because they are absent on election 
day.
---------------------------------------------------------------------------

    Some commenters contend that laboratory conditions are sometimes 
destroyed during election campaigns \138\ and that pressure from 
employers or other employees can occur during such campaigns.\139\ We 
agree. However, the Board's election process provides for post-election 
review of unlawful and other objectionable conduct, and such review may 
result in the invalidation of the election results and the conduct of a 
rerun election. There are no guarantees of comparable safeguards in the 
voluntary-recognition process. This is a meaningful distinction that 
supports previous court and Board decisions that Board-conducted 
elections are preferable to voluntary recognition.
---------------------------------------------------------------------------

    \138\ Reply Comment of IBEW.
    \139\ Comments of Local 32BJ; UA.
---------------------------------------------------------------------------

    One commenter states that the proposed changes to the blocking-
charge policy are inconsistent with the rationale stated here--i.e., 
that conditions attendant to Board elections make such elections 
preferable to voluntary recognition.\140\ We disagree. As previously 
stated, our revision of the blocking-charge policy is intended to 
protect the right of employees to a timely election. The outcome of 
that election may still be invalidated by the ultimate resolution of 
the merits of the blocking charge and its effects on employee free 
choice, but the timely conduct of the election is entirely consistent 
with the concept that a secret-ballot Board election is the preferred 
method for determining whether a union has majority support. Further, 
nothing in our final-rule amendments precludes the filing of a blocking 
charge with respect to an election petition filed after voluntary 
recognition. The same ``laboratory conditions'' standard will apply to 
the conduct of that election, and the same consequences will ensue if 
the blocking charge is ultimately found to have merit.
---------------------------------------------------------------------------

    \140\ Comment of SEIU.
---------------------------------------------------------------------------

    Relatedly, some commenters argue that Johnson Controls, supra, 
undercuts the rationale that a Board election is the preferred means of 
determining majority support, insofar as ``the non-electoral showing of 
lack of majority support there is no more reliable than the non-
electoral showing of majority support addressed in'' the rule 
here.\141\ We disagree. In Johnson Controls, the Board held that proof 
of an incumbent union's actual loss of majority support, if received by 
an employer within 90 days prior to contract expiration, conclusively 
rebuts the union's presumptive continuing majority status when the 
contract expires. 368 NLRB No. 20, slip op. at 2. However, the Board 
also held that, in those circumstances, the union may attempt to 
reestablish that status by filing a Board election petition within 45 
days from the date the employer gives notice of an anticipatory 
withdrawal of recognition. Id. Consequently, Johnson Controls 
established a process parallel to the one we adopt here in the final-
rule amendment. That is, after a bargaining relationship has been 
established or repudiated on the basis of a non-Board showing of 
majority-employee support for this action, employees will still have an 
immediate limited opportunity for a referendum on that action in a 
Board-supervised private-ballot election. For that matter, our final 
amendment of the voluntary-recognition bar provides greater protection 
to a continuing bargaining relationship than Johnson Controls does for 
majority-based withdrawal of recognition. If no petition is filed 
within the post-recognition period permitted under the rule, the 
recognition and contract-bar rules will take effect, potentially 
postponing any electoral challenge for years. In contrast, even if no 
petition is filed during the Johnson Controls open period following 
anticipatory repudiation, a petition can be filed at any time after 
expiration of the parties' final contract.
---------------------------------------------------------------------------

    \141\ Comments of SEIU; NNU.
---------------------------------------------------------------------------

    One commenter contends that the purported preference for Board 
elections conflicts with the Board's December 14, 2017 Request for 
Information (RFI) on the 2015 Election Rule, 82 FR 58783, inasmuch as 
the RFI was allegedly an attempt to weaken the 2015 Election Rule, 
which made it possible for employees to vote in a ``timelier 
manner.\142\ We disagree with this comment. Nothing in the RFI, which 
had no effect on the validity of procedures established by the 2015 
Election Rule, or in the amendments to those procedures set forth in 
the Board's 2019 Election Rule, which were founded on independent 
reasons stated therein, undercut the statutory, judicial, and agency 
preference for Board elections.
---------------------------------------------------------------------------

    \142\ Comment of EPI.
---------------------------------------------------------------------------

    Additionally, some commenters contend that the rule discriminates 
against voluntary recognition, contrary to various provisions of 
Section 1 of the Act (``encouraging practices fundamental to the 
friendly adjustment of industrial disputes''; protecting ``exercise by 
workers of full freedom of association, self-organization, and 
designation of representatives of their own choosing, for the purpose 
of negotiating the terms and conditions of their employment or other 
mutual aid or protection''; preventing ``industrial strife or unrest''; 
and ``encouraging the practice and procedure of collective 
bargaining'').\143\ One commenter also asserts that the rule is 
contrary to Section 8(a)(5) and Section 9(a) of the Act insofar as it 
``would place bargaining relationships formed by voluntary recognition 
at a disadvantage from their inception.'' \144\
---------------------------------------------------------------------------

    \143\ Comments of AFL-CIO; EPI; UFCW.
    \144\ Comment of UFCW.
---------------------------------------------------------------------------

    On the contrary, the final-rule amendment here does not 
discriminate against or in any way restrict the lawful voluntary 
establishment of majority-supported bargaining relationships, nor does 
it limit the immediate statutory rights and responsibilities that ensue 
upon commencement of those relationships. The amendment simply provides 
for a limited post-recognition opportunity for employees to exercise 
their statutory right of free choice through the preferred means of a 
Board election as to whether that relationship should continue without 
the possibility of further challenge for a substantial period of time. 
In this regard, several commenters correctly note that, currently, the 
immediate voluntary-recognition bar and the contract bar, together, can 
block employees' right to an election for 4 years (assuming a 3-year 
contract)--or even longer if the parties do not begin bargaining right 
away, as the voluntary-recognition bar period begins not at 
recognition, but when the parties start bargaining.\145\ Given this 
fact, we believe that the immediate post-recognition imposition

[[Page 18383]]

of an election bar does not sufficiently protect affected employees' 
statutory right to exercise their choice on collective-bargaining 
representation through the preferred method of a Board-conducted 
election. This consideration provides considerable support for the 
proposed rule.
---------------------------------------------------------------------------

    \145\ Comments of NRWLDF; CDW; GC Robb.
---------------------------------------------------------------------------

    Further, several commenters contend that voluntary recognition is 
arguably more democratic than a Board election because it requires a 
majority of all eligible employees, not just a majority of those who 
vote in an election.\146\ We do not dispute that voluntary recognition 
must always be based on an absolute majority of bargaining-unit 
employees, while the result of a Board election will be based on the 
choice of a majority of unit employees who actually vote. We disagree, 
however, that this makes voluntary recognition more democratic than a 
Board election. The conditions under which a choice is expressed, and 
the safeguards surrounding it, are as much as part of the democratic 
process as the number of those who register a choice. A secret-ballot 
election, overseen by a neutral federal agency with the power to 
prevent or remedy any objectionable conduct affecting the election, 
provides a far greater assurance of a truly democratic outcome than 
does the voluntary-recognition process.
---------------------------------------------------------------------------

    \146\ Comments of AFT; SEIU; UFCW; St. Louis-Kansas City 
Carpenters Regional Council; Professor Kulwiec.
---------------------------------------------------------------------------

2. Comments Alleging That the Rule is Arbitrary
    Some commenters assert that requiring notices only in the context 
of voluntary recognition is arbitrary: Notices are not required when an 
employer withdraws recognition from a certified union, or when a one-
year election bar expires; non-union employers are not required to post 
notices to employees about how to obtain Board recognition of a union; 
and in no other context does the Board require that employees be given 
notice of their right to change their minds about a recent exercise of 
statutory rights.\147\
---------------------------------------------------------------------------

    \147\ Comments of UA; IBEW; AFSCME; SEIU; AFL-CIO; NNU.
---------------------------------------------------------------------------

    It may or may not be true that notices should be required in some 
of these other contexts. But the rule is not arbitrary merely because 
it does not address those other contexts. Cf. Mobil Oil Expl. & 
Producing Se. Inc., 498 U.S. at 231 (``[A]n agency need not solve every 
problem before it in the same proceeding.''); Advocates for Highway & 
Auto Safety, 429 F.3d at 1147 (``Agencies surely may, in appropriate 
circumstances, address problems incrementally.''). And we decline to 
decide, in the context of this rulemaking, that postings should be 
required in contexts outside the scope of this rule. Accordingly, we 
reject these comments.
    Relatedly, one commenter states that there is no window period for 
reconsideration and an election petition when an employer lawfully 
withdraws recognition based on a showing of actual loss of majority 
support, or after a union loses an election and wants a re-vote just in 
case employees have changed their minds.\148\ We disagree. As stated 
above, when an employer lawfully withdraws recognition based on a 
petition or cards showing an actual lack of majority support, employees 
do have an opportunity for reconsideration and an election: They can 
immediately file an election petition if they can garner the supporting 
30 percent showing of interest for one. And after a union loses an 
election, the Act itself bars another election for 1 year precisely 
because employees have already voted in a Board election. This does not 
mean that the Board should decline to allow employees, in a voluntary-
recognition situation where employees have not voted in a Board 
election, to have a limited period of time to petition for an election 
where they can express their views by secret ballot.
---------------------------------------------------------------------------

    \148\ Comment of AFSCME.
---------------------------------------------------------------------------

3. Comments Regarding Post-Dana Experience
    Several commenters assert that data from the post-Dana period do 
not support the proposed rule because they show that workers requested 
an election in only a small percentage of cases, and workers voted 
against the incumbent union in only a fraction of those cases.\149\ As 
discussed in Lamons Gasket, as of May 13, 2011, the Board had received 
1,333 requests for Dana notices. 357 NLRB at 742. In those cases, 102 
election petitions were subsequently filed, and 62 elections were held. 
Id. In 17 of those elections, the employees voted against continued 
representation by the voluntarily recognized union, including 2 
instances in which a petitioning union was selected over the recognized 
union and 1 instance in which the petition was withdrawn after 
objections were filed. Id. Thus, only 7.65 percent of Dana notice 
requests resulted in election petitions, only 4.65 percent of Dana 
notices resulted in actual elections, and employees decertified the 
voluntarily recognized union in only 1.2 percent of the total cases in 
which Dana notices were requested.
---------------------------------------------------------------------------

    \149\ Comments of Workers United; IUOE; AFL-CIO; NNU; EPI; UFCW; 
UA; IBEW; Local 32BJ; AFSCME; St. Louis-Kansas City Carpenters 
Regional Council.
---------------------------------------------------------------------------

    On the other hand, in the elections that were held under Dana, 
employees voted against continued representation by the voluntarily 
recognized union approximately 25 percent of the time. Id. at 751 
(Member Hayes, dissenting). According to one commenter, this reversal 
rate shows that voluntary recognition is not a reliable indicator of 
majority-employee support.\150\
---------------------------------------------------------------------------

    \150\ Comment of NRWLDF.
---------------------------------------------------------------------------

    In our view, the fact that only a small percentage of all Dana 
notices resulted in ending continued representation by the voluntarily 
recognized union does not mean that the post-recognition open period 
procedure was unnecessary and should not be restored. The fact that in 
about 1 out of every 4 Dana elections a majority of employees voted to 
reject continued representation by a voluntarily recognized union is 
far from meaningless. Neither is the fact that Dana elections were held 
in only a small percentage of cases where the required notice of 
voluntary recognition and the right to petition for an election was 
given. In our view, Dana served its intended purpose of assuring 
employee free choice in all of those cases at the outset of a 
bargaining relationship based on voluntary recognition, rather than 1 
to 4 years or more later. Some commenters speculate that we could 
expect to see the same percentage of reversed outcomes after Board-
conducted elections if the statutory election bar did not exist to 
temporarily bar second elections,\151\ or that the reversal rate could 
represent something like ``buyer's remorse'' rather than the 
unreliability of authorization cards.\152\ Even were there evidence to 
support such speculation, we nonetheless believe that giving employees 
an opportunity to exercise free choice in a Board-supervised election 
without having to wait years to do so is still solidly based on and 
justified by the policy grounds already stated.
---------------------------------------------------------------------------

    \151\ Comments of Local 32BJ; AFL-CIO.
    \152\ Comment of Local 32BJ.
---------------------------------------------------------------------------

    Further, as for the 1231 cases in which Dana notices were requested 
but no petitions were filed, we know nothing about the reasons for that 
outcome. Specifically, we know nothing about the reliability of the 
proof of majority support that underlay recognition in each of these 
cases, nor do we know why no petition was filed. What we do know is 
that the employers and unions who voluntarily entered into bargaining 
relationships during Dana's effective period complied with the

[[Page 18384]]

notice requirement in impressive numbers and, as a consequence, we can 
be confident that affected employees were adequately informed of their 
opportunity to file for an election. In sum, Dana imposed no apparent 
material hardship and provided the intended benefits of notice and 
opportunity to exercise important statutory rights.
    One commenter asserts that between Fiscal Year 2012 and Fiscal Year 
2019, unlawful-recognition charges made up only about 1.6 percent of 
total unfair labor practice charges, and the commenter claims that the 
percentage should have been higher if the Board's animating concerns 
were founded.\153\ Relatedly, another commenter asserts that post-
Lamons Gasket, only a small percentage of unlawful-recognition charges 
resulted in a Board order, and that, if the overruling of Dana had 
truly undermined free choice, there should have been an increase in 
such charges.\154\ However, the breakdown of unfair labor practice 
charges and the reasons for not issuing a Board order can reflect any 
number of factors, and they do not necessarily indicate that a majority 
of employees actually support voluntary recognition. These comments are 
founded on the mistaken premise that the Dana procedure and its 
proposed reinstatement in this rulemaking are primarily intended to 
address unlawful voluntary recognition. To the contrary, the provision 
for notice and limited opportunity to petition for a Board election are 
intended to protect the preferred electoral mechanism from immediate 
and prolonged foreclosure by any voluntary recognition, lawful or 
otherwise. Ensuring employee free choice is a central purpose of the 
Act, and that purpose is furthered by the Dana procedure regardless of 
whether employees ultimately choose to continue their existing 
representation.
---------------------------------------------------------------------------

    \153\ Comment of UFCW.
    \154\ Comment of SEIU.
---------------------------------------------------------------------------

4. Comments Predicting That the Rule Will Have Negative Effects
    Some commenters claim that the rule will discourage voluntary 
recognition.\155\ However, employers and unions agree to voluntary 
recognition for any number of reasons, economic and otherwise, that the 
rule will not affect. See James J. Brudney, Neutrality Agreements and 
Card Check Recognition: Prospects for Changing Paradigms, 90 Iowa L. 
Rev. 819, 832-841 (2005) (setting forth various reasons for neutrality 
and card-check agreements). Further, there is no evidence that, under 
Dana, voluntary recognition was less frequent. In fact, as discussed 
above, only 7.65 percent of Dana notice requests resulted in election 
petitions--and approximately three-quarters of those resulted in a 
continuation of the bargaining relationship, with the additional 
benefits of Board certification. As one commenter notes,\156\ this 
includes a protected 1-year period for negotiation of a collective-
bargaining agreement,\157\ as opposed to the reasonable period of time 
for bargaining after voluntary recognition, a period that could be as 
little as 6 months.
---------------------------------------------------------------------------

    \155\ Comments of LIUNA MAROC; Local 304; SEIU.
    \156\ Comment of COLLE.
    \157\ See Brooks v. NLRB, 348 U.S. 96 (1954).
---------------------------------------------------------------------------

    Other commenters argue that the rule will discourage or delay 
collective bargaining. In this regard, one commenter asserts that the 
rule ``invites'' employees to file election petitions and that this 
will delay collective bargaining and representation.\158\ Other 
commenters assert that parties, especially smaller entities, will be 
less likely to waste limited resources engaging in bargaining that 
could be for naught.\159\ Further, according to several commenters, 
because a collective-bargaining agreement reached within 45 days would 
not bar a petition, parties will be more likely to delay bargaining, or 
at least ``serious'' bargaining--thereby undermining the policies 
behind both the voluntary-recognition bar (enabling parties to begin 
bargaining without interruption) and the contract bar (achieving a 
reasonable balance between industrial stability and employee choice of 
representative).\160\ Moreover, several commenters argue that the delay 
in full representation will frustrate the exercise of Section 7 rights 
and send employees a message of futility or cause them to be 
disillusioned with the union's representation, particularly given that 
the delay would occur when employees have not yet realized the benefits 
of collective bargaining.\161\
---------------------------------------------------------------------------

    \158\ Comment of IBEW.
    \159\ Comments of IBEW; SEIU.
    \160\ Comments of AFSCME; Local 32BJ; UWUA; Senator Murray; 
IUOE; AFL-CIO; UFCW.
    \161\ Comments of IBEW; Local 32BJ; SEIU; Professor Kulwiec; 
AFL-CIO; NNU; UFCW; CWA; AFSCME; St. Louis-Kansas City Carpenters 
Regional Council.
---------------------------------------------------------------------------

    As an initial matter, the final rule does not affect established 
precedent holding that an employer's obligation to bargain with the 
union attaches immediately upon voluntary recognition. During the 45-
day notice-posting period, the union can begin representing employees, 
processing their grievances, and bargaining on their behalf for a first 
contract. Even if a decertification or rival union petition is filed 
during the 45-day window period, that will not require or permit the 
employer to withdraw from bargaining or to refrain from executing a 
contract with the incumbent union. See Dresser Industries, Inc., 264 
NLRB 1088, 1089 (1982); RCA del Caribe, Inc., 262 NLRB 963, 965 (1982). 
If the union is decertified after a contract has been signed, the 
contract would lose effect. Wayne County Neighborhood Legal Services, 
333 NLRB 146, 148 fn.10 (2001); RCA del Caribe, 262 NLRB at 966; 
Consolidated Fiberglass Products, 242 NLRB 10 (1979). On the other 
hand, as noted above, if the union prevails in a post-recognition 
election, it will have the benefit of an extended one-year period for 
contract negotiations, during which, absent unusual circumstances, its 
majority status cannot be challenged.
    We also do not agree that the rule ``invites'' employees to file 
petitions for elections. The rule does not encourage, much less 
guarantee, the filing of a petition. An employer and a union are both 
free during the window period to express their views about the 
perceived benefits of a collective-bargaining relationship. If an 
employer believes that voluntary recognition is advantageous, it would 
not necessarily decline to recognize a union simply because there is 
some risk that a petition will be filed. Similarly, if a union has 
obtained a solid card majority and has been voluntarily recognized on 
that basis, it should not be deterred from promptly engaging in 
meaningful bargaining simply because of the risk of losing that 
majority in an election. For that matter, in many voluntary-recognition 
situations, recognition and the execution of a first collective-
bargaining agreement occur simultaneously. Although some commenters 
cite anecdotal evidence that Dana procedures occasionally delayed 
bargaining,\162\ there is no evidence in the record for this rulemaking 
that Dana had any meaningful impact on the negotiation of bargaining 
agreements during the open period or on the rate at which agreements 
were reached after voluntary recognition.
---------------------------------------------------------------------------

    \162\ Comments of AFL-CIO; Local 32BJ.
---------------------------------------------------------------------------

    Some commenters claim that the existence of a pending election 
petition will cause unions to spend more time campaigning or working on 
election-related matters rather than doing substantive work on behalf 
of employees.\163\ This may be true in some

[[Page 18385]]

situations. However, we believe that this is a reasonable trade-off for 
protecting employees' ability to express their views in a secret-ballot 
election. Moreover, we fail to see the bargaining disadvantage to a 
recognized union that can solidify, and perhaps expand, its base of 
support during the post-recognition open period.
---------------------------------------------------------------------------

    \163\ Comments of Local 32BJ; CWA.
---------------------------------------------------------------------------

    One commenter notes that the rule does not contain any mechanism 
that requires employers to post the notice, raising the possibility 
that an employer will willfully fail to post the notice and that an 
agreement reached could later be upended.\164\ According to this 
commenter, this may cause employers, in negotiations, to leverage their 
compliance with the notice-posting requirement against the union in an 
attempt to extract more generous substantive contract terms.\165\ While 
this scenario is possible, we have no basis to believe that it will 
occur, or if it does, that it would not be subject to a unfair labor 
practice allegation.
---------------------------------------------------------------------------

    \164\ Comment of Senator Murray.
    \165\ Id.
---------------------------------------------------------------------------

    One commenter contends that the rule would interfere in collective 
bargaining in another way. Specifically, this commenter claims, 
management often asks unions to agree not to discuss the details of 
ongoing negotiations or share drafts of either party's proposals with 
workers who are not involved in negotiations.\166\ According to this 
commenter, unions will therefore often face a dilemma if 
decertification efforts gain support based upon rumors about the 
negotiating process--specifically, should they allow the rumors to go 
unchallenged, or respond to them and risk compromising the 
negotiations? \167\ Whatever the likelihood that this would occur, we 
do not see why a lawfully recognized union would be bound to comply 
with any nondisclosure request that would interfere with its 
obligations to represent the unit employees during a post-recognition 
election campaign.
---------------------------------------------------------------------------

    \166\ Comment of Local 32BJ.
    \167\ Id.
---------------------------------------------------------------------------

    Several commenters argue that the rule will undercut industrial 
stability. For example, some commenters assert that the rule will 
disrupt longstanding and/or stable collective-bargaining relationships 
by encouraging election campaigns, which can involve heated 
rhetoric.\168\ Another commenter states that the rule will require 
unions to jump through procedural hoops before they can achieve 
industrial stability, ``without basically any concomitant benefit to 
employees.'' \169\ First, the final rule here does not apply to 
longstanding collective-bargaining relationships. At most, in the 
absence of compliance with notice requirements after initial voluntary 
recognition, it applies to a post-recognition period extending no 
longer than the first collective-bargaining agreement. Second, we think 
it is unlikely that parties who have voluntarily entered into a 
mutually advantageous collective-bargaining relationship will engage in 
heated rhetoric in an ensuing election campaign, but if that does 
happen it is part of the free exchange of views that the Act protects. 
Third, data from the post-Dana period indicates that recognized unions 
will not often have to jump through the procedural ``hoop'' of an 
election, and those that do will far more often emerge with a 
reaffirmation of their majority support and the greater protection of a 
Board certification. The benefit to employees, as frequently stated 
here, is the assurance of their statutory right of free choice by 
providing them the limited opportunity to test a recognized union's 
majority support through the preferred means of a Board election.
---------------------------------------------------------------------------

    \168\ Comments of IBEW; AFSCME.
    \169\ Comment of Plumbers and Pipe Fitters.
---------------------------------------------------------------------------

    One commenter asserts that, when a company acquires another 
business, voluntary-recognition agreements help employers and workers 
by not creating extra concerns during this period of transition; in 
essence, these agreements help ensure workplace stability at a critical 
time.\170\ But, as discussed above, we do not believe that the rule 
will materially discourage voluntary-recognition agreements. The final 
rule also does not disturb existing legal principles governing the 
obligations of a successor employer.
---------------------------------------------------------------------------

    \170\ Comment of CWA.
---------------------------------------------------------------------------

    In addition, one commenter contends that the rule will invite local 
managers to reverse a national decision to grant voluntary recognition 
by unlawfully assisting a Dana petition, and further contends that this 
did happen once.\171\ There is no basis in the record for finding that 
this would occur on more than rare occasions, let alone for believing 
that it would escape detection through the Board's unfair labor 
practice processes if and when it does occur. It is always the case 
that bad actors may seek to subvert the Board's representation 
procedures through unlawful or otherwise objectionable conduct. 
Remedies exist to address such misconduct, and the bad acts of a few 
are no reason not to make those procedures more widely available.
---------------------------------------------------------------------------

    \171\ Comment of Local 32BJ.
---------------------------------------------------------------------------

    One commenter claims that the concomitant change to the immediate 
contract-bar rule will disturb parties' settled understandings of their 
rights and invalidate the private bargaining process that the Act is 
intended to promote.\172\ We believe that the modification is a 
necessary part of the voluntary-recognition-bar modification, with both 
modifications striking a more appropriate balance between labor-
relations stability and employee free choice. Further, the contract-bar 
modification should incentivize parties to post a notice in order to 
avoid having the results of their negotiations subsequently 
invalidated.
---------------------------------------------------------------------------

    \172\ Comment of UFCW.
---------------------------------------------------------------------------

5. Comments Regarding Availability of Other Alternatives
    Several commenters argue that there are other alternatives and that 
their availability undercuts the need for the proposed rule, or that 
other alternatives are superior to the proposed rule. In particular, 
some commenters assert that employees may file unfair labor practice 
charges if they believe that voluntary recognition is not based on 
majority support or is based on coerced support, while non-petitioner 
employees may not file election-related challenges and objections to 
Board elections.\173\ Further, several commenters note that employees 
have 6 months to file unfair labor practice charges, while parties have 
only 7 days to file objections after an election.\174\ We do not 
believe that the availability of unfair labor practice proceedings to 
challenge the validity of voluntary recognition undercuts the rule. As 
one commenter notes, unfair labor practice proceedings generally take 
longer than representation proceedings,\175\ and the General Counsel 
has unlimited discretion to decline to issue a complaint--and can 
settle the matter with the parties, without Board or court review--thus 
making it possible that the Board would never adjudicate employees' 
claims.\176\ In any event, the commenters' entire premise is misguided. 
The Board's unfair labor practice processes are not an alternative to 
the final-rule amendment. The former, as relevant here, provide a means 
to challenge the legal validity of a voluntary recognition. As 
previously indicated, the purpose of the final-rule amendment is not to 
provide a means to challenge the legal validity of voluntary 
recognition. It is to provide a limited window of time for a referendum 
on that recognition through the preferred

[[Page 18386]]

means and with the numerous advantages of a Board-supervised private-
ballot election. Thus, the existing availability of the unfair labor 
practice process is not a substitute for the rule.
---------------------------------------------------------------------------

    \173\ Comments of AFL-CIO; IBEW; Local 32BJ; SEIU; IUOE; St. 
Louis-Kansas City Carpenters Regional Council.
    \174\ Comments of AFL-CIO; Local 32BJ; St. Louis-Kansas City 
Carpenters Regional Council.
    \175\ Comment of CNLP.
    \176\ Id.
---------------------------------------------------------------------------

    Further, one commenter asserts that the rule is overbroad because 
it encompasses voluntary recognition based on non-Board secret-ballot 
elections.\177\ According to that commenter, private agencies such as 
the American Arbitration Association can ensure the integrity of 
elections, and private election agreements often provide for post-
election procedures that parallel the Board's.\178\ Another commenter 
contends that for successful voluntary recognitions, employers and 
unions have agreed to a process and a set of rules, and have met the 
voluntary-recognition requirements in a format that a third party or 
neutral can confirm and verify--and that it would be federal-government 
overreach for the Board to interfere with these arrangements.\179\
---------------------------------------------------------------------------

    \177\ Comment of AFL-CIO.
    \178\ Id.
    \179\ Comment of James T. Springfield.
---------------------------------------------------------------------------

    However, another commenter contends that arbitrators merely count 
cards against a list of employees and do not know how the cards were 
obtained.\180\ In any event, regardless of what agreements employers 
and unions reach on these types of matters, we believe that there is 
significant value in allowing employees an opportunity to petition for 
a Board-conducted election. If they do not choose that option or do not 
garner sufficient support for an election petition, then nothing in 
this rule would interfere with the parties' alternative arrangements. 
Alternatively, if their petition does achieve the necessary support, 
the resulting Board election is at worst merely duplicative of the 
parties' private arrangements, and it offers a prevailing union all the 
advantages of Board certification.
---------------------------------------------------------------------------

    \180\ Comment of NRWLDF.
---------------------------------------------------------------------------

    Another commenter notes that employees have the option to petition 
for an election during an open period between contracts.\181\ However, 
as discussed previously, the recognition bar and the contract bar, 
together, can last up to 4 years--longer, if there is a gap between 
recognition and bargaining. In our view, that is an unacceptable burden 
on employees' ability to file an election petition following voluntary 
recognition.
---------------------------------------------------------------------------

    \181\ Comment of IBEW.
---------------------------------------------------------------------------

    One commenter notes that cards signed as a result of deliberate 
misrepresentations regarding the purpose of the card are invalid for 
purposes of proving the union's majority status.\182\ But the 
possibility of cards being invalidated would necessarily involve unfair 
labor practice litigation challenging majority status. This does not 
constitute a sufficient alternative to a secret-ballot election.
---------------------------------------------------------------------------

    \182\ Comment of Local 32BJ.
---------------------------------------------------------------------------

    Moreover, one commenter contends that the NPRM failed to explain 
why the benefits of certification are insufficient to satisfy the 
Board's expressed preference for elections.\183\ This comment assumes 
that employees are aware of the electoral option and that their vote 
for union representation would confer certain additional benefits on 
the representative and the bargaining relationship thus established, 
but they nevertheless consent to the alternative establishment of a 
bargaining relationship based on voluntary recognition. We question 
whether employees are aware of the benefits of certification and have 
consciously elected to forego them in favor of the voluntary-
recognition process. Even if this is so, it does not persuade us that 
this majority choice should immediately foreclose the possibility of a 
limited post-recognition opportunity for employees to test or confirm 
the recognized union's majority status by the preferred means of a 
Board election.
---------------------------------------------------------------------------

    \183\ Comment of AFL-CIO.
---------------------------------------------------------------------------

6. Comments Providing General Critiques of the Proposed Rule
    Some commenters assert that the proposed notice-posting policy is 
contrary to the Board's role as a neutral.\184\ We disagree. The rule 
is merely an attempt to provide for greater protection of employee free 
choice in selection of a representative; it has no effect on what that 
choice will be. Moreover, as discussed further in Section III.F.7. 
below, we have modified the text of the proposed rule, to provide that 
the Dana notice will more neutrally reflect the different options that 
are available to employees.
---------------------------------------------------------------------------

    \184\ Comments of IBEW; Senator Murray; NNU; St. Louis-Kansas 
City Carpenters Regional Council.
---------------------------------------------------------------------------

    Another commenter contends that the rule presumes that freely 
entered, arms-length contracts are innately suspect, contrary to 
longstanding jurisprudence.\185\ The rule does not rest on this 
presumption; it merely gives employees a chance, for a limited period, 
to file a petition for an election to confirm whether such contracts 
were validly entered.
---------------------------------------------------------------------------

    \185\ Comment of Joel Dillard.
---------------------------------------------------------------------------

    Additionally, several commenters assert that, because only 30 
percent of employees are needed to support a showing of interest, the 
rule gives employers and a minority of employees the chance to marshal 
support for ousting the union.\186\ According to some commenters, the 
many (albeit ultimately unsuccessful) petitions filed under Dana show 
that even in cases where a majority of voting employees ultimately 
favor representation, an anti-union minority is encouraged to keep 
resisting the majority's will.\187\ According to one commenter, just as 
the Act does not contemplate an election rerun absent objectionable 
conduct, it also does not contemplate a ``do-over'' organizing period 
simply because a minority of employees are unhappy.\188\
---------------------------------------------------------------------------

    \186\ Comments of SEIU; EPI; IUOE; UFCW; AFSCME.
    \187\ Comment of Local 32BJ.
    \188\ Comment of IUOE.
---------------------------------------------------------------------------

    However, as discussed previously, under Dana the Board received 
only 102 election petitions relative to 1,333 requests for notices over 
a period of several years. We do not believe that this indicates that a 
minority of employees repeatedly resist the majority's will by filing 
petitions. And in any event, we believe that it is important to give 
all employees an opportunity--a narrow and limited opportunity--to 
express their free choice by petitioning for an election.
    Further, some commenters contend that the rule will waste 
government and party resources by requiring unnecessary elections.\189\ 
As an initial matter, as noted previously, the data under Dana show 
that, over a period of several years, only 62 elections were held--not 
a tremendously high number. In any event, we do not consider the 
elections ``unnecessary,'' regardless of whether they confirm continued 
representation. We believe that securing employee free choice is worth 
the commitment of resources. And we note again that in approximately 25 
percent of those elections, employees voted to oust the recognized 
union.
---------------------------------------------------------------------------

    \189\ Comments of AFSCME; NNU; UFCW; CWA.
---------------------------------------------------------------------------

    One commenter contends that the NPRM failed to comply with the APA 
because it did not contain the text of the contemplated notice to 
employees--and that, without that text, it is impossible to provide 
meaningful comments.\190\ However, in the NPRM, the Board explicitly 
proposed ``to reinstate the Dana notice.'' 84 FR at 39938. The key 
contents of the Dana notice were well established in that 
decision,\191\ and

[[Page 18387]]

there is no basis for finding that the commenter was precluded from 
providing meaningful comments merely because the NPRM did not quote the 
Dana notice in its entirety.\192\
---------------------------------------------------------------------------

    \190\ Comment of IBEW.
    \191\ Specifically, in Dana, the Board held that the notice 
should clearly state that (1) the employer (on a specified date) 
recognized the union as the employees' exclusive bargaining 
representative based on evidence indicating that a majority of 
employees in a described bargaining unit desire its representation; 
(2) all employees, including those who previously signed cards in 
support of the recognized union, have the Sec. 7 right to be 
represented by a union of their choice or by no union at all; (3) 
within 45 days from the date of the notice, a decertification 
petition supported by 30 percent or more of the unit employees may 
be filed with the NLRB for a secret-ballot election to determine 
whether or not the unit employees wish to be represented by the 
union, or 30 percent or more of the unit employees can support 
another union's filing of a petition to represent them; (4) any 
properly supported petition filed within the 45-day period will be 
processed according to the Board's normal procedures; and (5) if no 
petition is filed within the 45 days from the date of this notice, 
then the recognized union's status as the unit employees' exclusive 
majority bargaining representative will not be subject to challenge 
for a reasonable period of time following the expiration of the 45-
day window period, to permit the union and the employer an 
opportunity to negotiate a collective-bargaining agreement. 351 NLRB 
at 443.
    \192\ We note that, as discussed further below--consistent with 
recommendations from two commenters--the final rule makes some 
modifications with respect to required elements in tbe new post-
recognition notice that differ from the requirements for a Dana 
notice. There also is no basis for finding that commenters 
reasonably could not have known to submit comments regarding what 
the notices should, or should not, include. In fact, some commenters 
did exactly that, and we have responded positively to those 
comments, as discussed below.
---------------------------------------------------------------------------

    In addition, one commenter argues that the Board has failed to 
consider alternatives like shortening the length of the recognition-bar 
period.\193\ However, we do not believe that this alternative would be 
sufficient to achieve the goals that we have discussed herein and in 
the NPRM. Further, it arguably would detract from the labor-relations 
stability that so many commenters discuss and that we seek to balance 
with employee free choice. Accordingly, we reject that proffered 
alternative.
---------------------------------------------------------------------------

    \193\ Comment of UFCW.
---------------------------------------------------------------------------

    Further, one commenter contends that the NPRM leaves open the 
possibility of further changes in the law with respect to other 
discretionary election-bar policies; this highlights both the arbitrary 
character of the items chosen for resolution here and the Board's 
failure to achieve its stated goal of ensuring predictability; and, by 
creating uncertainty about the status of these related doctrines, the 
Board undermines the bargaining process in other contexts.\194\ 
However, for the reasons stated in Sections III.A. and III.F.2. above, 
we are not required to make changes to all related doctrines in this 
current rulemaking. Further, all legal doctrines are subject to change, 
whether through rulemaking or adjudication, so the mere mention of 
possible future changes does not create additional uncertainty that 
undermines the bargaining process. As the Board itself stated in 
defense of what it described as ``targeted'' amendments to 
representation procedures in the 2015 Election Rule: ``Of course, an 
administrative agency, like a legislative body, is not required to 
address all procedural or substantive problems at the same time. It 
need not `choose between attacking every aspect of a problem or not 
attacking the problem at all.' Dandridge v. Williams, 397 U.S. 471, 487 
(1970). Rather, the Board `may select one phase of one field and apply 
a remedy there, neglecting the others.' FCC v. Beach Commc'ns, 508 U.S. 
307, 316 (1993) (quoting Williamson v. Lee Optical of Okla., Inc., 348 
U.S. 483, 489 (1955)). `[T]he reform may take one step at a time.' 
Id.'' 79 FR at 74318 (footnote omitted).
---------------------------------------------------------------------------

    \194\ Id.
---------------------------------------------------------------------------

    For the above reasons, we find that these comments do not support 
abandoning the proposed rule.\195\
---------------------------------------------------------------------------

    \195\ In its voluntary-recognition arguments, one commenter 
refers back to one of its blocking-charge arguments, specifically, 
that the rule would violate the First and Fourteenth Amendments to, 
and the Take Care Clause of, the U.S. Constitution, and that it also 
raises separation-of-powers concerns. See Comment of NNU (citing 
Thomas v. Collins, 323 U.S. 516). Once again, this commenter does 
not explain its argument, and the cited decision does not support 
the commenter's claim. Thus, we reject this claim as unsupported.
---------------------------------------------------------------------------

7. Comments Suggesting Changes to the Proposed Rule
    The General Counsel recommends that we extend the notice period 
from 45 days to 1 year.\196\ Another commenter supports this 
recommendation, stating that it would better protect employee free 
choice because employees, especially those in larger units or units 
that span multiple locations, need more time to organize to collect a 
decertification petition; and individual employees often need longer 
because they do not have ready access to paid organizers or to counsel 
who can guide them through the Board's election process and the legal 
rules for collecting petition signatures.\197\ In contrast, a different 
commenter opposes such an extension, claiming that it is draconian; 
would threaten lawful, voluntary, nascent collective-bargaining 
relationships by permitting either a minority of employees or a rival 
union to file a petition during that period; would not promote 
collective bargaining and industrial peace; would run contrary to 
congressional intent that elections be conducted only where employers 
refuse to voluntarily recognize the union; and would thwart the 
expressed desire of a majority of workers.\198\
---------------------------------------------------------------------------

    \196\ Comment of GC Robb.
    \197\ Reply Comment of NRWLDF.
    \198\ Reply Comment of IBEW.
---------------------------------------------------------------------------

    Consistent with certain commenters' comments, we believe that the 
45-day notice period strikes a reasonable balance between employee free 
choice and other interests--such as labor-relations stability and 
preserving lawful, voluntary recognitions--and ensures that both 
employers and unions have the benefit of the recognition bar for a 
reasonable period of time following the close of the window period when 
no petition is filed.\199\ Additionally, a 45-day period is consistent 
with the period established in Johnson Controls for union petitions 
following notice of anticipatory withdrawal of recognition. See 368 
NLRB No. 20. Further, as one commenter states, because employers would 
be responsible for posting and maintaining the Board-provided notice 
``throughout this period,'' extending the notice period to 1 year would 
make additional challenges to compliance more likely.\200\ Accordingly, 
we decline to adopt the recommended change.
---------------------------------------------------------------------------

    \199\ Comments of COLLE; the Chamber; CDW.
    \200\ Reply Comment of AFL-CIO.
---------------------------------------------------------------------------

    The General Counsel also recommends that, at the end of his 
proposed 1-year period of notice posting, the Board should have 
discretion to continue to dismiss petitions ``based on the facts and 
circumstances of the case,'' or to impose a recognition bar ``if 
circumstances so warrant.'' \201\ Other commenters disagree with this 
recommendation.\202\ As one commenter notes, the General Counsel 
provides no insight into what ``circumstances [would] warrant 
insulating the collective-bargaining relationship for a limited period 
of time.'' \203\ We agree. In addition to the fact that we have 
rejected the proposal to extend the posting period to 1 year, we also 
do not believe that there is sufficient clarity as to how this proposed 
change would apply. Accordingly, we decline to adopt this suggested 
alternative.
---------------------------------------------------------------------------

    \201\ Comment of GC Robb.
    \202\ Reply Comment of NRWLDF; Reply Comment of AFL-CIO.
    \203\ Reply Comment of AFL-CIO.
---------------------------------------------------------------------------

    Additionally, the General Counsel recommends that we modify the 
proposed amendment so that agreements entered into after the parties' 
first collective-bargaining agreement would enjoy bar status, 
regardless of whether the suggested 1-

[[Page 18388]]

year notice was posted.\204\ We agree. Even if there is no election bar 
for the first contract executed in the absence of compliance with the 
notice requirements of the amendment, we do not see the need to 
continue an unrestricted open period for filing petitions during the 
term of any successor agreement. In this connection, we note that 
current contract-bar rules created in adjudication permit the filing of 
petitions during established periods prior to the end of any contract 
with a term of 3 years or less. See, e.g., Johnson Controls, Inc., 368 
NLRB No. 20, slip op. at 8 fn. 45 (discussing open periods for filing 
petitions in healthcare and nonhealthcare industries). In addition, 
there is no election bar after the third year of a contract with a 
longer effective term, nor is there any bar following contract 
expiration and prior to the effective date of a successor agreement. 
Under these circumstances, we believe that extant open-period rules 
provide a sufficient opportunity for employees and rival unions to file 
petitions and, thus, that it is unnecessary to require a notice posting 
and another open period upon execution of any successor collective-
bargaining agreement. Accordingly, we clarify the rule to specify that 
a voluntary recognition entered into on or after the effective date of 
this rule, and ``the first'' collective-bargaining agreement entered 
into on or after the date of such voluntary recognition, will not bar 
the processing of an election petition if the requirements of the rule 
are not met.
---------------------------------------------------------------------------

    \204\ Comment of GC Robb.
---------------------------------------------------------------------------

    The General Counsel also recommends that the final rule specify the 
content of the notice and that the text of the notice should include 
several items. First, the General Counsel asserts that the rule should 
include all of the applicable items from the Dana notice. Second, the 
General Counsel contends that the rule should include information 
regarding how the contract bar operates during and after the window 
period and, in particular, should notify employees that they may file a 
petition within the window period even if the employer and union have 
already reached a collective-bargaining agreement, and that if they do 
not challenge the union's status by filing a petition and the parties 
subsequently reach a collective-bargaining agreement, an election 
cannot be held for the duration of the collective-bargaining agreement, 
up to 3 years. Third, the General Counsel argues that the notice should 
include a more balanced description of employee rights and an 
affirmation of the Board's neutrality, as the Dana notice has been 
criticized as being too one-sided in its description of employee 
rights, and therefore susceptible to the impression that the Board is 
urging employees to reconsider their selection of the new union. To 
give a more complete explanation of employee rights and to reinforce 
the Board's neutrality, the General Counsel suggests that the notice 
should be updated to include the following language:

    Federal law gives employees the right to form, join, or assist a 
union and to choose not to engage in these protected activities.
    An employer may lawfully recognize a union based on evidence 
indicating that a majority of employees in an appropriate bargaining 
unit desire its representation.
    Once an employer recognizes a union as the employees' exclusive 
bargaining representative, the employer has an obligation to bargain 
with the union in good faith in an attempt to reach a collective-
bargaining agreement. That obligation is not delayed or otherwise 
impacted by this notice.
    The National Labor Relations Board is an agency of the United 
States Government and does not endorse any choice about whether 
employees should keep the current union, file a decertification 
petition, or support or oppose a representation petition filed by 
another union.\205\
---------------------------------------------------------------------------

    \205\ Comment of GC Robb.

    The AFL-CIO proposes further revisions, specifically, that the 
following, italicized words be added to the General Counsel's proposed 
---------------------------------------------------------------------------
revisions:

    An employer may lawfully recognize a union based on evidence 
(such as signed authorization cards) indicating that a majority of 
employees in an appropriate unit desire its representation, even 
absent an election supervised by the National Labor Relations Board.
    The National Labor Relations Board is an agency of the United 
States Government and does not endorse any choice about whether 
employees should keep the current union, file a petition to certify 
the current union, file a decertification petition, or support or 
oppose a representation petition filed by another union.\206\
---------------------------------------------------------------------------

    \206\ Reply Comment of AFL-CIO.

We agree that the notice should contain the additions suggested by both 
the General Counsel and the AFL-CIO. As the General Counsel notes, such 
wording gives employees a more complete picture of their rights and 
emphasizes the Board's neutrality in these matters. We also agree that 
the text of the final rule should include the wording of the notice. We 
have modified the text of the final rule, Sec.  103.21 accordingly. In 
addition, consistent with the additions to the notice set forth above, 
we modify the text of the final rule, Sec.  103.21 to require employers 
to post a notice informing employees of their right to file ``a 
petition''--not ``a decertification or rival union petition.''
    The General Counsel also argues that, in addition to notice-
posting, the Board should require employers to distribute individual 
notices to employees via a second method of the employers' 
choosing,\207\ and another commenter supports this recommendation.\208\ 
We believe that it is appropriate for the final rule to mirror the 
requirements that apply to petitions for elections. Accordingly, 
consistent with the 2019 Election Rule that is scheduled to take effect 
in Spring of 2020,\209\ the instant final rule specifies that the 
employer shall post the notice ``in conspicuous places, including all 
places where notices to employees are customarily posted,'' and shall 
also distribute it ``electronically to employees in the petitioned-for 
unit, if the employer customarily communicates with its employees 
electronically.''
---------------------------------------------------------------------------

    \207\ Comment of GC Robb.
    \208\ Reply Comment of NRWLDF.
    \209\ See 84 FR at 69591.
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G. Final-Rule Amendment Regarding Proof of Majority-Based Recognition 
in the Construction Industry

    The Board received numerous comments on the proposal to redefine 
the evidence required to prove that a construction-industry employer 
and labor organization have established a majority-based collective-
bargaining relationship under Section 9(a) of the Act. We have 
carefully reviewed and considered these comments, as discussed below.
1. Comments Regarding Board and Court Precedent
    Many commenters support the requirement that positive evidence is 
needed to prove that a union demanded recognition as the exclusive 
bargaining representative and that the employer granted it based on a 
demonstration of majority support. More specifically, the commenters 
contend that the rule will restore the protection of employee free 
choice that Congress intended to ensure when it enacted Section 
8(f).\210\ We agree.
---------------------------------------------------------------------------

    \210\ Comments of COLLE; Associated General Contractors of 
America (AGC); GC Robb; NRWLDF; Miller & Long Company, Inc. (M&L); 
the Chamber; ABC; NFIB.
---------------------------------------------------------------------------

    The Deklewa Board properly struck a balance between employee free 
choice and stability in bargaining relationships, consistent with the 
congressional intent expressed in Section 8(f). As discussed in Section 
I.B.5. above, Section 8(f) permits construction-industry unions

[[Page 18389]]

and employers to enter collective-bargaining relationships absent 
employee majority support, but such relationships do not bar election 
petitions. The Deklewa Board adopted a presumption that bargaining 
relationships in the construction industry are governed by Section 
8(f), and it made 8(f) agreements enforceable for their term. Moreover, 
the Board abolished the flawed conversion doctrine and held that 8(f) 
relationships could develop into 9(a) relationships only through Board 
election or voluntary recognition--and, in the latter case, only 
``where that recognition is based on a clear showing of majority 
support among the unit employees.'' 282 NLRB at 1387 fn. 53.
    The Board's current Staunton Fuel standard, which requires only 
contract language to establish a 9(a) relationship, is contrary to 
these fundamental principles. See King's Fire Protection, Inc., 362 
NLRB 1056, 1063 fn. 24 (2015) (Member Miscimarra, dissenting in part) 
(observing that the Staunton Fuel standard ``is even more troubling 
than the conversion doctrine that the Board abandoned in Deklewa'' 
because, ``[u]nder [Staunton Fuel], mere words are sufficient to cause 
`pre-hire' recognition to convert to Sec[tion] 9(a) status, even where 
. . . there has been no showing of actual employee majority support''). 
By requiring positive evidence of employee majority support to 
establish a 9(a) relationship, the instant rule will restore the proper 
balance of interests--employee free choice on one hand, labor-relations 
stability on the other--intended by Congress and safeguarded in 
Deklewa.
    In addition, many commenters note that the D.C. Circuit repeatedly 
has rejected the Staunton Fuel test, and they urge the Board to adopt 
the court's position that contract language alone cannot create a 9(a) 
bargaining relationship.\211\ As discussed in Section I.B.5. above, in 
Nova Plumbing and Colorado Fire Sprinkler, the D.C. Circuit criticized 
the Board's reliance solely on contract language, finding it 
inconsistent with the majoritarian principles set forth by the Supreme 
Court in Garment Workers. Colorado Fire Sprinkler, 891 F.3d at 1038-
1039; Nova Plumbing, 330 F.3d at 536-537. See also M & M Backhoe Serv., 
Inc. v. NLRB, 469 F.3d 1047, 1050 (D.C. Cir. 2006) (explaining that ``a 
union seeking to convert its section 8(f) relationship to a section 
9(a) relationship may either petition for a representation election or 
demand recognition from the employer by providing proof of majority 
support,'' and finding a 9(a) relationship based on signed 
authorization cards).
---------------------------------------------------------------------------

    \211\ Comments of COLLE; AGC; GC Robb; the Chamber; ABC; CDW.
---------------------------------------------------------------------------

    As the court explained, ``while an employer and a union can get 
together to create a Section 8(f) pre-hire agreement, only the 
employees, through majority choice, can confer Section 9(a) status on a 
union.'' Colorado Fire Sprinkler, 891 F.3d at 1040 (emphasis in 
original). Thus, in order ``to rebut the presumption of Section 8(f) 
status, actual evidence that a majority of employees have thrown their 
support to the union must exist and, in Board proceedings, that 
evidence must be reflected in the administrative record.'' Id. As some 
commenters note, the court's rejection of the Board's reliance solely 
on contract language is a strong reason to support the instant rule, as 
every Board decision can be reviewed by the D.C. Circuit. 29 U.S.C. 
160(f).
    On the other hand, other commenters argue that the proposed rule is 
not appropriate because the NPRM incorrectly interpreted Staunton Fuel 
and the D.C. Circuit's decisions.\212\ Specifically, they argue that 
the court stated that contract language and intent are relevant 
factors, so those factors should be determinative where countervailing 
evidence is weak or nonexistent. Some commenters also rely on the D.C. 
Circuit's decision in Allied Mechanical Services, Inc. v. NLRB, 668 
F.3d 758 (DC Cir. 2012).
---------------------------------------------------------------------------

    \212\ Comments of AFL-CIO; Road Sprinkler Fitters Local Union 
No. 669 (Local 669); IBEW; IUOE; North America's Building Trades 
Unions (NABTU); UA.
---------------------------------------------------------------------------

    Contrary to the commenters, the court has ``held that `contract 
language' and `intent' of the union and company alone generally cannot 
overcome the Section 8(f) presumption'' because allowing them to do so 
``runs roughshod over the principles of employee choice established in 
Supreme Court precedent.'' Colorado Fire Sprinkler, 891 F.3d at 1039 
(internal quotations omitted). Further, although the court has 
indicated that contract language and intent ``certainly'' are not 
determinative factors when ``the record contains strong indications 
that the parties had only a section 8(f) relationship,'' id., its 
decisions do not compel the inverse proposition--i.e., that contract 
language and intent are determinative where record evidence of 8(f) 
status is weak. Such a proposition disregards that under Deklewa, 
bargaining relationships in the construction industry are presumed to 
be governed by Section 8(f), and therefore no evidence is required to 
establish 8(f) status. In any event, the court clearly has not 
foreclosed requiring positive evidence demonstrating majority support 
in all cases. And as we have explained, requiring such evidence would 
effectuate the Act's purposes by protecting employee free choice, 
accomplish the congressional intent expressed in Section 8(f), and 
conform to the majoritarian principles set forth by the Supreme Court 
in Garment Workers. In addition, Allied Mechanical does not support the 
commenters' position. In Allied Mechanical, the court found that a 
construction-industry union established 9(a) status by requesting 
recognition based on signed authorization cards and by entering a 
settlement agreement that contained an affirmative bargaining order 
predicated on its previous majority support. 668 F.3d at 768-769. Thus, 
the union did not solely rely on contract language to demonstrate its 
9(a) status.
    Moreover, we also note that, in pre-Staunton Fuel cases, the United 
States Courts of Appeals for the First and Fourth Circuits also 
required a contemporaneous showing of majority support to establish a 
9(a) relationship. American Automatic Sprinkler Sys., Inc. v. NLRB, 163 
F.3d 209, 221-222 (4th Cir. 1998) (``The Board's willingness to credit 
the employer's voluntary recognition absent any contemporaneous showing 
of majority support would reduce this time-honored alternative to 
Board-certified election to a hollow form which, though providing the 
contracting parties stability and repose, would offer scant protection 
of the employee free choice that is a central aim of the Act.''), cert. 
denied 528 U.S. 821 (1999); NLRB v. Goodless Elec. Co., 124 F.3d 322, 
324, 330 (1st Cir. 1997) (``Voluntary recognition requires the union's 
unequivocal demand for, and the employer's unequivocal grant of, 
voluntary recognition as the employees' collective[-]bargaining 
representative based on the union's contemporaneous showing of 
majority[-]employee support.''). Further, the United States Court of 
Appeals for the Eighth Circuit relied on both contract language and 
additional evidence in finding that a construction-industry union 
established 9(a) status in NLRB v. American Firestop Solutions, Inc., 
673 F.3d 766, 770-771 (8th Cir. 2012).
    In sum, we find that Board and court precedent fully support 
requiring positive evidence demonstrating majority-employee union 
support to establish a 9(a) relationship in the construction industry.

[[Page 18390]]

2. Comments Regarding Employee Free Choice
    As many commenters contend, requiring positive evidence of 
majority-employee union support will also better effectuate the 
purposes of the Act.\213\ The current Staunton Fuel standard undermines 
employees' Section 7 rights by effectively reintroducing the conversion 
doctrine that the Deklewa Board repudiated and by subjecting employees 
to the contract bar precluding elections for several years, even where 
there has never been any extrinsic proof that a majority of the 
employees support the union.\214\ As the commenters point out, the 
protection of employees' Section 7 free-choice rights is a central 
purpose of the Act, and the rule would protect those rights. Further, 
as another commenter notes, the rule will also provide greater 
stability in the construction industry by clarifying the requirements 
to create 9(a) relationships.\215\
---------------------------------------------------------------------------

    \213\ Comments of Representatives Foxx and Walberg; CNLP; COLLE; 
AGC; NRWLDF; the Chamber; ABC; NFIB; CDW. See also Reply Comment of 
CNLP.
    \214\ We also note that the Staunton Fuel standard gives rise to 
a post-contract presumption of continuing majority support absent 
positive evidence that the union has ever enjoyed such support.
    \215\ Comment of Mechanical Contractors Association of America 
(MCAA).
---------------------------------------------------------------------------

3. Comments Regarding Collusion
    Several commenters contend that the Board's current standard turns 
a blind eye to union and employer collusion in the construction 
industry, trampling employee free choice.\216\ We agree. By allowing 
unions and employers to enter into 9(a) relationships based on contract 
language alone, employees' rights can be usurped with a stroke of a 
pen. Further, as the commenters point out, this is not mere speculation 
but has been demonstrated in several Board decisions in which parties 
falsified majority support. See, e.g., Colorado Fire Sprinkler, Inc., 
364 NLRB No. 55, slip op. at 5 (Member Miscimarra, dissenting) (noting 
that parties signed agreement recognizing 9(a) status before single 
employee hired); King's Fire Protection, Inc., 362 NLRB at 1059 (Member 
Miscimarra, dissenting in part) (same); Triple C Maintenance, 327 NLRB 
42, 42 fn. 1 (1998) (pre-Staunton Fuel, finding 9(a) relationship based 
on recognition clause even though no employees when relationship 
began), enfd. 219 F.3d 1147 (10th Cir. 2000); Oklahoma Installation 
Co., 325 NLRB 741, 741-742, 745 (1998) (same), enf. denied 219 F.3d 
1160 (10th Cir. 2000).
---------------------------------------------------------------------------

    \216\ Comments of M&L; GC Robb; NRWLDF; the Chamber.
---------------------------------------------------------------------------

    Thus, Staunton Fuel has effectively permitted construction-industry 
unions and employers to collude at the expense of employees. For these 
reasons, we disagree with other commenters' contention that there is 
little evidence that the 9(a) process is being abused or that Staunton 
Fuel has negatively affected employee free choice.\217\
---------------------------------------------------------------------------

    \217\ Comments of LIUNA MAROC; IUOE; UA.
---------------------------------------------------------------------------

4. Comments Regarding Definition of Positive Evidence
    Some commenters request that we define what ``positive evidence'' 
is sufficient to demonstrate majority-employee union support.\218\ One 
commenter contends that the Board should permit authorization cards, 
dues-checkoff cards, membership applications, or any other evidentiary 
means to establish majority status, consistent with 9(a) recognition in 
other industries.\219\ Another commenter notes that the preamble to the 
NPRM referred to extrinsic evidence in the form of employee signatures 
on authorization cards or a petition, but the text of the proposed rule 
did not.\220\
---------------------------------------------------------------------------

    \218\ See, e.g., Comment of Local 669.
    \219\ Id.
    \220\ Comment of AGC.
---------------------------------------------------------------------------

    Although we find it unnecessary to modify the proposed rule's 
wording in this regard, we clarify that this rule is not intended to 
change the current standards regarding the forms of evidence that are 
acceptable to demonstrate majority support. In Deklewa, the Board 
stated that it did ``not mean to suggest that the normal presumptions 
would not flow from voluntary recognition accorded to a union by the 
employer of a stable work force where that recognition is based on a 
clear showing of majority support among the unit employees, e g., a 
valid card majority.'' 282 NLRB at 1387 fn. 53 (citing Island 
Construction Co., 135 NLRB 13 (1962)). ``That is,'' the Board 
continued, Deklewa was not ``meant to suggest that unions have less 
favored status with respect to construction[-]industry employers than 
they possess with respect to those outside the construction industry.'' 
Id. The instant rule is not intended to change that principle. 
Accordingly, the same contemporaneous showing of majority support that 
would suffice to establish that employees wish to be represented by a 
labor organization in collective bargaining with their employer under 
Section 9(a) in non-construction industries will also suffice to 
establish recognition under Section 9(a) in construction-industry 
bargaining relationships. It is well established that signed 
authorization cards or petitions from a majority of bargaining-unit 
employees is adequate proof, as is the result of a private election 
conducted under the auspices of a neutral party pursuant to a voluntary 
pre-recognition or neutrality agreement. There is less certainty in 
Board precedent whether other extrinsic evidence, such as that 
mentioned by Local 669, would be sufficient to prove majority 
support.\221\ Accordingly, we leave any further development of these 
evidentiary standards to future proceedings. Cf. Mobil Oil Expl. & 
Producing Se. Inc., 498 U.S. at 231 (``[A]n agency need not solve every 
problem before it in the same proceeding.''); Advocates for Highway & 
Auto Safety, 429 F.3d at 1147 (``Agencies surely may, in appropriate 
circumstances, address problems incrementally.'').
---------------------------------------------------------------------------

    \221\ See discussion of evidentiary factors in Deklewa, 282 NLRB 
at 1383-1384.
---------------------------------------------------------------------------

5. Comments Regarding Prospective Application
    Some commenters argue that the Board should apply the rule only to 
construction-industry bargaining relationships entered into on or after 
the date the rule goes into effect.\222\ We agree, and we have modified 
the regulatory text to specify that the rule applies only prospectively 
to a voluntary recognition extended on or after the effective date of 
the rule and to any collective-bargaining agreement entered into on or 
after the date of voluntary recognition extended on or after the 
effective date of the rule. Relatedly, two commenters question how the 
rule will affect successor agreements.\223\ We clarify that, if the 
successor agreement is reached by parties that entered into a voluntary 
9(a) recognition agreement before the effective date of the rule, then 
the rule will not apply to that agreement. Further, once parties prove 
a 9(a) relationship under the rule, they will not be required to 
reestablish their 9(a) status for successor agreements.
---------------------------------------------------------------------------

    \222\ Comments of IUOE; LlUNA MAROC.
    \223\ Comments of MCAA; LIUNA MAROC.
---------------------------------------------------------------------------

6. Comments Regarding Section 10(b) of the Act
    Some commenters urge the Board to incorporate a Section 10(b) 6-
month limitation for challenging a construction-industry union's 
majority status.\224\ In Casale Industries, the Board held that it 
would ``not entertain a claim that majority status was lacking at the

[[Page 18391]]

time of recognition'' where ``a construction[-]industry employer 
extends 9(a) recognition to a union, and 6 months elapse without a 
charge or petition.'' 311 NLRB 951, 953 (1993). The D.C. and Fourth 
Circuits have expressed doubts regarding that aspect of Casale, while 
the Tenth and Eleventh Circuits have upheld the Board's position. 
Compare Nova Plumbing, 330 F.3d at 539, and American Automatic 
Sprinkler Systems, 163 F.3d 209, 218 fn. 6 (4th Cir. 1998), with Triple 
C Maintenance, 219 F.3d 1147, 1156-1159 (10th Cir. 2000), and NLRB v. 
Triple A Fire Protection, 136 F.3d 727, 736-737 (11th Cir. 1998). Some 
former Board Members also have disagreed with that aspect of Casale. 
See King's Fire Protection, Inc., 362 NLRB at 1062 (Member Miscimarra, 
dissenting in part); Saylor's Inc., 338 NLRB 330, 332-333 fn. 9 (2002) 
(Member Cowen, dissenting); Triple A Fire Protection, 312 NLRB 1088, 
1089 fn. 3 (1993) (Member Devaney, concurring). Cf. Painters (Northern 
California Drywall Assn.), 326 NLRB 1074, 1074 fn. 1 (1998) (Member 
Brame finding it unnecessary to pass on validity of Casale).
---------------------------------------------------------------------------

    \224\ Comments of NABTU; Local 669. See also Reply Comment of 
Local 669.
---------------------------------------------------------------------------

    For several reasons, we decline to adopt a Section 10(b) 6-month 
limitation on challenging a construction-industry union's majority 
status by filing a petition for a Board election, and we overrule 
Casale to the extent that it is inconsistent with the instant rule. 
Specifically, we overrule Casale's holding that the Board will not 
entertain a claim that majority status was lacking at the time of 
recognition where a construction-industry employer extends 9(a) 
recognition to a union and 6 months elapse without a petition.
    As an initial matter, we note that Section 10(b) applies only to 
unfair labor practices and that this aspect of the rule addresses only 
representation proceedings--i.e., whether an election petition is 
barred because a construction-industry employer and union formed a 9(a) 
rather than an 8(f) collective-bargaining relationship.
    Further, we agree with the doubts expressed by the D.C. and Fourth 
Circuits, and by some former Board Members, regarding Section 10(b)'s 
applicability to challenges to a construction-industry union's 
purported 9(a) status. Nova Plumbing, 330 F.3d at 539; American 
Automatic Sprinkler Sys., 163 F.3d at 218 fn. 6; King's Fire 
Protection, Inc., 362 NLRB at 1062 (Member Miscimarra, dissenting in 
part); Saylor's, 338 NLRB at 332-333 fn. 9; Triple A Fire Protection, 
312 NLRB at 1089 fn. 3. It is not unlawful for a construction-industry 
employer and union to establish an 8(f) relationship without majority-
employee union support. Thus, the issue is whether the parties formed 
an 8(f) or a 9(a) relationship, and only if the parties formed a 9(a) 
relationship could there be an unfair labor practice that would trigger 
Section 10(b)'s 6-month limitation. See also Brannan Sand & Gravel Co., 
289 NLRB at 982 (predating Casale; nothing ``precludes inquiry into the 
establishment of construction[-]industry bargaining relationships 
outside the 10(b) period'' because ``[g]oing back to the beginning of 
the parties' relationship . . . simply seeks to determine the majority 
or nonmajority[-]based nature of the current relationship and does not 
involve a determination that any conduct was unlawful''). In other 
words, Casale begs the question by assuming the very 9(a) status that 
ought to be the object of inquiry.
    In addition, we find that the Board's pertinent reasoning in Casale 
was flawed. See King's Fire Protection, Inc., 362 NLRB at 1062-1063 
(Member Miscimarra, dissenting in part). For decades, the Board had 
held that in other industries, Section 10(b) barred untimely 
allegations that an employer unlawfully extended 9(a) recognition to a 
minority union. North Bros. Ford, Inc., 220 NLRB 1021, 1021-1022 (1975) 
(citing Machinists Local 1424 (Bryan Mfg.) v. NLRB, 362 U.S. 411 
(1960)). In Casale, the Board stated that ``[p]arties in the 
construction industry are entitled to no less protection.'' 311 NLRB at 
953. However, the Casale Board failed to recognize that employees and 
rival unions will likely presume that a construction-industry employer 
and union entered an 8(f) collective-bargaining agreement, which is 
virtually certain to have a term longer than 6 months. Thus, it is 
highly unlikely that they will file a petition challenging the union's 
status within 6 months of recognition.
    Finally, and most significantly, we find that Casale's requirement 
that an election petition be filed within 6 months to challenge a 
purported 9(a) recognition in the construction industry improperly 
discounts the importance of protecting employee free choice as 
recognized by Congress in enacting Section 8(f) and by the Board and 
the Supreme Court in deciding Deklewa and Garment Workers, 
respectively. Garment Workers, 366 U.S. at 737-741; King's Fire 
Protection, Inc., 362 NLRB at 1062 (Member Miscimarra, dissenting in 
part); John Deklewa & Sons, 282 NLRB at 1378.
    Therefore, we overrule Casale in relevant part and will evaluate a 
construction-industry union's purported 9(a) recognition at any time 
that an election petition is filed.
7. Comments Regarding Filing Unfair Labor Practice Charges
    Some commenters argue that the rule is unnecessary because it is 
already unlawful for any labor organization to enter into a 9(a) 
collective-bargaining agreement with any employer absent majority 
support.\225\ They correctly point out that an employer violates the 
Act by granting Section 9(a) recognition to a union that does not enjoy 
majority status, and that a union similarly violates the Act by 
accepting such recognition when it does not represent a majority of 
employees. The remedy in such situations is to order the parties to 
cease recognition of the union as employees' collective-bargaining 
representative and to cease maintaining or giving effect to the 
collective-bargaining agreement.
---------------------------------------------------------------------------

    \225\ Comments of NABTU; Professor Kulwiec; Senator Murray; 
Local 669; Springfield. See also Reply Comments of NABTU; Local 669.
---------------------------------------------------------------------------

    The commenters fail to recognize that, until there is a Board 
decision finding merit to such unfair labor practice allegations, any 
election petition remains barred. Moreover, when a decision issues 
finding merit in such allegations, the remedy does not include an 
election. There is no remedy of a Board election in an unfair labor 
practice case finding that an employer and union entered into a Section 
9(a) collective-bargaining agreement when the union did not enjoy 
majority support. By requiring positive evidence that a construction-
industry union demanded 9(a) recognition and that the employer granted 
such recognition based on a contemporaneous showing of majority-
employee support, the rule better protects employee free choice in a 
representation proceeding.\226\
---------------------------------------------------------------------------

    \226\ We note that the rule applies to the question of whether 
an election petition is barred in a representation proceeding and 
does not directly implicate unfair labor practice rules.
---------------------------------------------------------------------------

8. Comments Regarding Effects on Certain Bargaining Relationships
    Some commenters argue that the rule will adversely affect older 
bargaining relationships in the construction industry and/or small 
construction-industry unions.\227\ They argue that the longer a 
bargaining relationship lasts, the more difficult it will be for a 
union to produce positive evidence of majority support when the demand 
for recognition could have occurred years or even decades prior. 
Therefore, those bargaining relationships would become

[[Page 18392]]

less stable due to the passage of time. Relatedly, these commenters 
contend that the rule imposes an onerous new recordkeeping requirement 
and that small local unions would lack the resources to retain records 
of employee support.
---------------------------------------------------------------------------

    \227\ Comments of NABTU; AFL-CIO; IUOE; CWA; Professor Kulwiec; 
Local 304; MRCC; AFT. See also Reply Comment of Local 669.
---------------------------------------------------------------------------

    As explained above, the rule will apply only prospectively to an 
employer's voluntary recognition extended on or after the effective 
date of the rule and to any collective-bargaining agreement entered 
into on or after the date of voluntary recognition extended on or after 
the effective date of the rule. Thus, the rule will not affect or 
destabilize longstanding bargaining relationships in the construction 
industry. Further, although we acknowledge that the rule will 
incentivize unions to keep a record of majority-employee union support 
moving forward, we do not consider such a minor administrative 
inconvenience a sufficient reason to permit employers and unions to 
circumvent employees' rights.
9. Comments Regarding Frequency of Section 9(a) Agreements in the 
Construction Industry
    Some commenters argue that the rule is not appropriate because the 
issue of whether a construction-industry employer recognized or entered 
into a petition-barring agreement with a union as the 9(a) 
representative of its employees occurs very infrequently.\228\ However, 
what matters here is the statutory right, not how often it is 
implicated. The Act protects employees' free choice to select their 
9(a) bargaining representative. As one commenter notes, even though the 
rule may affect a small number of cases, that does not mean that there 
are not good reasons to adopt it.\229\
---------------------------------------------------------------------------

    \228\ Comments of Professor Kulwiec; EPI; IUOE; MRCC; LIUNA 
MAROC.
    \229\ Comment of NRWLDF.
---------------------------------------------------------------------------

10. Comments Regarding Issues in Representation Proceedings
    Other commenters raise concerns regarding the Board's ability to 
rule on parol evidence in representation-case proceedings, which are 
non-adversarial and do not allow credibility determinations.\230\ 
However, in cases where there are authentication issues, the Board 
expects that the process will be similar to that followed in an 
administrative investigation of a showing of interest: the Region will 
examine the signatures and handwriting comparators to determine whether 
a majority of unit employees supported the union at the time of 
recognition. Thus, these concerns are unwarranted.
---------------------------------------------------------------------------

    \230\ Comments of NABTU; IUOE. See also Reply Comment of NABTU.
---------------------------------------------------------------------------

11. Comments Regarding Contract Law
    One commenter asserts that contract language alone should be 
sufficient to demonstrate majority status because principles of 
contract construction hold parties to their obligations, including 
contract wording stating that a union has majority support.\231\ 
Relatedly, other commenters argue that the instant rule is contrary to 
the rules of contract law because it would require extrinsic evidence 
regardless of how clear the contract language is.\232\ However, 
construction-industry employers and unions may enter a 9(a) 
relationship only where a majority of employees support the union. 
Thus, contract language alone is insufficient where a majority of 
employees never supported the union. Further, requiring positive 
evidence of majority support, even where contract language initially 
appears clear, is necessary to ensure that unions and employers do not 
collude, thereby protecting employee free choice consistent with the 
congressional intent expressed in Section 8(f) and with the 
majoritarian principles discussed by the Supreme Court in Garment 
Workers, 366 U.S. at 737.
---------------------------------------------------------------------------

    \231\ Comment of Professor Kulwiec.
    \232\ Comment of Senator Murray; CWA.
---------------------------------------------------------------------------

12. Comments Regarding Adequacy of Justification for Rule
    Several commenters argue that the Board failed to adequately 
justify the proposed rule, asserting that the Board failed to offer 
evidence in support, analyze relevant data, or consider contrary 
arguments.\233\ We disagree. The Board has fully justified the rule 
based on available evidence and relevant data, including prior Board 
precedent in Deklewa and its progeny, negative reception by the D.C. 
Circuit in Nova Plumbing and Colorado Fire Sprinkler, and the rights 
protected by the Act, particularly employees' right of free choice in 
selecting (or refraining from selecting) a 9(a) representative. 
Further, we have fully considered and addressed all contrary arguments, 
as demonstrated by our responses in this rulemaking.
---------------------------------------------------------------------------

    \233\ Comments of AFL-CIO; NABTU; EPI; United Brotherhood of 
Carpenters and Joiners of America; UA. See also Reply Comment of 
NABTU.
---------------------------------------------------------------------------

13. Comments Suggesting Modifications to the Rule
    Some commenters suggest modifications to the rule.
    First, some commenters propose that the rule should not apply to RM 
petitions.\234\ However, it is well established that an 8(f) 
relationship will not bar an RM petition. See John Deklewa & Sons, 282 
NLRB at 1385 fn. 42. Thus, it is appropriate to require the party 
seeking to establish 9(a) status to present positive evidence of a 
contemporaneous showing of majority support, and we reject the 
commenters' proposal.
---------------------------------------------------------------------------

    \234\ Comments of LIUNA MAROC; NABTU.
---------------------------------------------------------------------------

    Second, some commenters contend that the issue of whether contract 
language alone can establish 9(a) status has implications beyond 
elections--i.e., to unfair labor practice proceedings--and that the 
Board should address those contexts.\235\ However, this request is 
beyond the scope of the rule, which only addresses representation 
proceedings. Thus, we deny the request. We will address any unfair 
labor practice issues as they arise in future, appropriate proceedings. 
Cf. Mobil Oil Expl. & Producing Se. Inc., 498 U.S. at 231 (``[A]n 
agency need not solve every problem before it in the same 
proceeding.''); Advocates for Highway & Auto Safety, 429 F.3d at 1147 
(``Agencies surely may, in appropriate circumstances, address problems 
incrementally.'').
---------------------------------------------------------------------------

    \235\ Comments of AGC; Senator Murray; IUOE.
---------------------------------------------------------------------------

    Third, one commenter proposes to prohibit automatic renewal of 8(f) 
agreements.\236\ But our concern here is to remove obstructions to 
Section 8(f)'s second proviso, and automatic renewal of 8(f) agreements 
does not obstruct that proviso because employees and rival unions are 
free to file election petitions at any time an 8(f) agreement is in 
effect, as the Board made clear in Deklewa. Accordingly, we reject this 
proposal.
---------------------------------------------------------------------------

    \236\ Comment of M&L.
---------------------------------------------------------------------------

    Fourth, one commenter proposes that we require a contemporaneous 
showing of majority support in all industries because collective-
bargaining relationships in other industries are also lawful only if 
the union had majority support at the time of recognition or Board 
election.\237\ However, the construction industry is unique in allowing 
voluntary recognition of unions that are supported by a minority of 
employees or by no employees at all,\238\ and this rule is intended to 
address issues, unique to that industry, that arise when assessing 
whether a relationship is properly treated as a 9(a), rather than 8(f), 
relationship. Thus, we reject the commenter's proposal. Relatedly, the 
same commenter requests that we specify that 9(a) recognition can

[[Page 18393]]

only occur if an employer employs a substantial and representative 
complement of employees. We note that the final rule does not disturb 
established precedent on this point.
---------------------------------------------------------------------------

    \237\ Comment of CNLP.
    \238\ An employer in the construction industry may recognize a 
union as the 8(f) bargaining representative of employees it has yet 
to hire. Indeed, an 8(f) agreement is often referred to as a ``pre-
hire'' agreement.
---------------------------------------------------------------------------

    Finally, we reject one commenter's argument that a 9(a) 
relationship should be created only through a Board election.\239\ This 
argument is contrary to well-established precedent permitting voluntary 
recognition. It is also at odds with language in the Act itself. See 
Section 9(a), 29 U.S.C. 159(a) (referring to representatives 
``designated or selected'' for the purposes of collective bargaining); 
Section 9(c), 29 U.S.C. 159(c) (providing for a Board-conducted 
election based on a petition stating, in relevant part, that the 
employer ``declines to recognize'' a labor organization as employees' 
9(a) representative).
---------------------------------------------------------------------------

    \239\ Comment of NFIB.
---------------------------------------------------------------------------

14. Comments Requesting Clarifications
    Some commenters seek clarifications regarding the rule.
    Two commenters question whether employers must review evidence of 
majority-employee union support at the time of recognition.\240\ This 
rule only requires the party seeking to establish 9(a) status to 
provide evidence demonstrating that a majority of unit employees 
supported the union at the time of recognition; the rule does not also 
require parties to show that the employer reviewed the evidence at that 
time.
---------------------------------------------------------------------------

    \240\ Comments of NABTU; UA.
---------------------------------------------------------------------------

    Another commenter seeks clarification regarding whether 9(a) 
relationships created before the effective date of the rule will 
automatically revert to 8(f) relationships.\241\ As explained, the rule 
will apply only prospectively to an employer's voluntary recognition 
extended on or after the effective date of the rule and to any 
collective-bargaining agreement entered into on or after the date of 
voluntary recognition extended on or after the effective date of the 
rule. Thus, the rule will not disrupt longstanding 9(a) relationships.
---------------------------------------------------------------------------

    \241\ Comment of AGC.
---------------------------------------------------------------------------

    Two commenters ask whether the new voluntary-recognition window 
period, discussed in Sec.  103.21(a) of the final rule, will apply to 
9(a) bargaining relationships in the construction industry.\242\ 
Although we do not believe it is necessary to modify the wording of the 
final rule in this regard, the answer is yes--the window period 
applies, along with the other requirements of Sec.  103.21(a).
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    \242\ Comments of the Chamber; Senator Murray.
---------------------------------------------------------------------------

    Finally, one commenter questions how the rule will affect multi-
employer bargaining units, me-too agreements, jobsite-only agreements, 
and voter eligibility.\243\ These questions are fact dependent, and we 
believe that they are more properly addressed as they arise in future, 
appropriate proceedings.
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    \243\ Comment of MCAA.
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IV. Justification for the Final Rule

    For all of the reasons set forth above and in the NPRM, we believe 
that all of the aspects of the final rule further the Act's overarching 
goals of protecting employees' free, informed choice in designating or 
selecting their representatives, while also promoting industrial 
stability and collective bargaining and ensuring that unions claiming 
Section 9(a) representative status have the requisite majority-employee 
support. Accordingly, we find it appropriate to issue this final rule.

V. Other Statutory Requirements

A. The Regulatory Flexibility Act

Final Regulatory Flexibility Analysis
    The Regulatory Flexibility Act of 1980, as amended by the Small 
Business Regulatory Enforcement Fairness Act of 1996 (RFA), 5 U.S.C. 
601-612, requires an agency promulgating a final rule to prepare a 
final regulatory flexibility analysis when the regulation will have a 
significant impact on a substantial number of small entities. An agency 
is not required to prepare a final regulatory flexibility analysis if 
the agency head certifies that the rule will not have a significant 
economic impact on a substantial number of small entities. 5 U.S.C. 
605(b). In the NPRM, although the Board believed that this rule would 
not have a significant economic impact on a substantial number of small 
entities, the Board issued its Initial Regulatory Flexibility Analysis 
(IRFA) to provide the public the fullest opportunity to comment on the 
proposed rule. See 84 FR at 39953. The Board solicited comments from 
the public that would shed light on potential compliance costs that may 
result from the rule and that the Board had not identified or 
anticipated.
    The RFA does not define either ``significant economic impact'' or 
``substantial number of small entities.'' \244\[thinsp]Additionally, 
``[i]n the absence of statutory specificity, what is `significant' will 
vary depending on the economics of the industry or sector to be 
regulated. The agency is in the best position to gauge the small entity 
impacts of its regulations.'' \245\
---------------------------------------------------------------------------

    \244\ 5 U.S.C. 601.
    \245\ Small Business Administration Office of Advocacy, A Guide 
for Government Agencies: How to Comply with the Regulatory 
Flexibility Act 18 (Aug. 2018), https://www.sba.gov/sites/default/files/advocacy/How-to-Comply-with-the-RFA-WEB.pdf (last visited Mar. 
23, 2020).
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    We anticipate that the rule will impose low costs of compliance on 
small entities, related to reviewing and understanding the substantive 
changes to the blocking-charge policy, voluntary-recognition-bar 
doctrine, and modified requirements for proof of majority-based 
voluntary recognition under Section 9(a) in the construction industry. 
There may also be a low cost for a small entity to prepare, post, and 
distribute a notice of voluntary recognition under the modified 
voluntary-recognition bar. In addition, there may be an unknown cost 
for small entities to participate in elections that might not have 
occurred but for the final rule and a de minimis cost for small labor 
unions representing employees in the building and construction trades 
to retain proof of their majority support.
1. Statement of the Need for, and Objectives of, the Rule
    Detailed descriptions of this final rule, its purpose, objectives, 
and the legal basis are contained earlier in the summary and 
supplementary information sections. In brief, the final rule includes 
three provisions that are necessary to accomplish the objective of 
better protecting the statutory rights of employees to express their 
views regarding representation. First, the final rule modifies the 
current blocking-charge policy and implements two new procedures to 
process representation petitions where a party files or has filed an 
unfair labor practice charge--a vote-and-impound procedure or a vote-
and-count procedure. Next, the final rule modifies the voluntary-
recognition-bar doctrine by providing employees and rival unions with a 
45-day window period in which to file an election petition after an 
employer voluntarily recognizes a union based on demonstrated majority 
support. Lastly, the final rule modifies the requirements for proof of 
majority-based voluntary recognition under Section 9(a) in the building 
and construction industry by eliminating the possibility of 
establishing Section 9(a) status based solely on contract language 
drafted by the employer and/or union. Thus, the final rule assists the 
Board in its fundamental obligation to protect employee free choice and 
Section 7 rights.

[[Page 18394]]

2. Statement of the Significant Issues Raised by the Public Comments in 
Response to the Initial Regulatory Flexibility Analysis, a Statement of 
the Assessment of the Agency of Such Issues, and a Statement of any 
Changes Made in the Proposed Rule as a Result of Such Comments
a. Response to Comments Concerning Estimated Compliance Costs of the 
Rule
    Several commenters criticized the Board's quantification of costs 
associated with each of the three changes. Generally, the AFL-CIO 
asserts that the Board's definition of an economic impact is 
underinclusive, its analysis was limited to easily quantifiable costs, 
and it failed to attempt to quantify other costs by assessing Board 
data.
    Regarding the blocking-charge policy-modification, the AFL-CIO 
accuses the Board of incorrectly professing an inability to quantify 
the cost of participating in additional elections. It asserts that the 
Board has awarded such costs as a remedy in unfair labor practice cases 
and, therefore, could quantify such costs in the IRFA. Further, it 
claims that the Board could have used the same method used to quantify 
the cost of learning about the rule to quantify the cost of holding an 
election, i.e., specifying the personnel that would participate in an 
election, their wage rate, and a projection of hours spent on an 
election, or could have used election costs awarded in past 
arbitrations.
    Regarding the modification to the voluntary-recognition bar, the 
International Brotherhood of Electrical Workers asserts that the Board 
failed to assess the cost of ``delayed bargaining and disruption of 
bargaining relationships that would be caused by the proposed notice 
posting requirement.'' However, no data or further information was 
provided.
    Both the AFL-CIO and the International Brotherhood of Electrical 
Workers generally fault the Board for failing to analyze certain costs 
associated with the change in the evidence necessary to prove a 
majority-based bargaining relationship in the construction industry and 
to thus block an election petition. According to the International 
Brotherhood of Electrical Workers, the Board further failed to analyze 
the cost of the disruption to established collective-bargaining 
relationships in the construction industry that would occur because of 
the rule.
    Respectfully, those commenters do not raise direct economic impacts 
under the RFA. The RFA does not require a regulatory agency to consider 
speculative and wholly discretionary responses to the rule, or the 
indirect impact on every stratum of the economy. What the statute 
requires is that the agency consider the direct burden that compliance 
with a new regulation will likely impose on small entities. See Mid-Tex 
Elec. Coop., Inc. v. FERC, 773 F.2d 327, 342 (DC Cir. 1985) (``[I]t is 
clear that Congress envisioned that the relevant `economic impact' was 
the impact of compliance with the proposed rule on regulated small 
entities''); accord White Eagle Coop. Ass'n v. Conner, 553 F.3d 467, 
478 (7th Cir. 2009); Colorado State Banking Bd. v. Resolution Trust 
Corp., 926 F.2d 931, 948 (10th Cir. 1991).
    This construction of the RFA, requiring agencies to consider only 
direct compliance costs, finds support in the text of that Act. Section 
603(a) of the RFA states that if an IRFA is required, the IRFA ``shall 
describe the impact of the proposed rule on small entities.'' 5 U.S.C. 
603(a). Although the term ``impact'' is undefined, its meaning can be 
gleaned from Section 603(b), which recites the required elements of an 
IRFA. One such element is ``a description of the projected reporting, 
recordkeeping and other compliance requirements of the proposed rule, 
including an estimate of the classes of small entities which will be 
subject to the requirement and the type of professional skills 
necessary for preparation of the report or record.'' 5 U.S.C. 
603(b)(4). Section 604 further corroborates the Board's conclusion, as 
it contains an identical list of requirements for a final regulatory 
flexibility analysis (if one is required). 5 U.S.C. 604(b)(4). 
Additional support for confining the regulatory analysis to direct 
compliance costs is found in an authoritative guide published by the 
Office of Advocacy of the United States Small Business Administration 
(SBA). In that guide--A Guide for Government Agencies: How to Comply 
with the Regulatory Flexibility Act (SBA Guide) (Aug. 2018), https://www.sba.gov/sites/default/files/advocacy/How-to-Comply-with-the-RFA-WEB.pdf-the SBA explains that ``other compliance requirements'' under 
section 603 include things such as capital costs for equipment, costs 
of modifying existing processes and procedures, lost sales and profits, 
changes in market competition, extra costs associated with the payment 
of taxes or fees, and hiring employees. SBA Guide at 37. These are all 
direct, compliance-based costs.
    In the IRFA, we noted that the only identifiable compliance costs 
imposed by the proposed rule related to reviewing and understanding the 
substantive changes and the minimal cost associated with the posting of 
a notice of voluntary recognition. 84 FR at 39956. Otherwise, there 
will be no ``reporting, recordkeeping and other compliance 
requirements'' for small entities. See 5 U.S.C. 603(b)(4) & 604(b)(4). 
The same is true of the final rule, except to the extent that the final 
rule requires electronic distribution of notices to employees where an 
employer customarily communicates with employees electronically--at 
most, a minimal additional cost.
    Consistent with these principles, the Board rejects the view that 
it must analyze the indirect and speculative costs of delayed 
bargaining or the disruption of bargaining relationships. The D.C. 
Circuit has firmly rejected the notion that a regulating agency must 
analyze every indirect and remote economic impact. See Mid-Tex Elec. 
Coop., Inc., 773 F.2d at 343 (``Congress did not intend to require that 
every agency consider every indirect effect that any regulation might 
have on small businesses in any stratum of the national economy.''). 
``[R]equir[ing] an agency to assess the impact on all of the nation's 
small businesses possibly affected by a rule would be to convert every 
rulemaking process into a massive exercise in economic modeling, an 
approach we have already rejected.'' Cement Kiln Recycling Coal. v. 
EPA, 255 F.3d 855, 869 (D.C. Cir. 2001) (citing Mid-Tex Elec. Coop., 
Inc., 773 F.2d at 343).
    Notwithstanding the indirect nature of the potential impacts raised 
by these comments, we also disagree with the notion that the rule will 
upset existing collective-bargaining relationships. We specifically 
note that the final rule regarding the requirement of proof to 
demonstrate majority-based 9(a) status in the construction industry has 
been clarified to reflect that it will apply only to voluntary 
recognitions extended on or after the effective date of this rule and 
to any collective-bargaining agreement entered into on or after the 
date of voluntary recognition extended on or after the effective date 
of this rule. Thus, established bargaining relationships will not be 
disrupted. Further, we believe that the rule will promote employees' 
statutory right of free choice on questions concerning representation 
by removing unnecessary barriers to the fair and expeditious resolution 
of such questions through the preferred means of a Board-conducted 
secret-ballot election. Labor-management stability will be promoted 
when employees' rights are respected.

[[Page 18395]]

    Furthermore, while the Board recognized the possibility that small 
employers and unions may have to prepare for and participate in 
elections that may not have occurred but for the rule, such a cost is 
also speculative. Even if such a cost could be quantified, given how 
relatively infrequently the issues in this rule arise in Board 
proceedings, the cost would not affect a substantial number of small 
entities. As we explain below, the rule would annually impact only 744 
out of approximately 6 million small entities. See Section V.A.4. The 
Board has neither a method to accurately determine the number of 
elections that may occur as a result of the rule nor a method to 
quantify the cost of participating in an election. In the cases cited 
by the AFL-CIO where the Board has awarded elections costs as an 
extraordinary remedy, the aggrieved party requested costs associated 
with an election that had already occurred, Texas Super Foods, 303 NLRB 
209 (1991), or costs associated with ``a prolonged attempt at 
organization, requiring extraordinary expenditures,'' J. P. Stevens & 
Co., 244 NLRB 407, 458 (1979), but neither decision stated the amount 
awarded.\246\ The unknown cost of each of those elections was unique to 
those particular elections, as are the costs associated with all 
elections. The commenters do not appear to appreciate the number of 
variables that may come into play when attempting to quantify the cost 
of an election, such as the size of the petitioned-for unit, number of 
facilities, geographic location, or strength of opposition or 
favorability to union organization. Simply put, any attempt to quantify 
this cost would be incredibly speculative.
---------------------------------------------------------------------------

    \246\ The arbitration decision cited by the AFL-CIO, Yale-New 
Haven Hospital, Arbitration Proceedings Before Margaret M. Kern 
(Oct. 23, 2007), includes an award of organizing expenses for the 
union, but there, too, the union calculated and submitted the 
expenses. Moreover, neither the employer nor the union are within 
the SBA's small entity size standard. See fns. 250 & 254.
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b. Response to Comments Concerning Economic Impact on Small Labor 
Unions
    The International Brotherhood of Electrical Workers and the AFL-CIO 
criticize the Board's IRFA analysis for failing to adequately 
acknowledge and assess the potential impact of the rule on small labor 
unions, particularly local labor unions. Neither commenter has 
identified a specific ``impact'' that the IRFA did not address or that 
is not addressed in this Section. In reviewing the comments on the 
IRFA, we find no other compliance costs to small labor unions, other 
than the very low cost relating to reviewing and understanding the rule 
(and, in some cases, a de minimis cost to retain records relating to 
proof of majority status), and no evidence presented shows that any 
additional indirect cost to small labor unions would constitute a 
significant impact.
c. Response to Comments Concerning Recordkeeping Requirements
    The Board's IRFA stated that there may be a recordkeeping cost 
imposed on small construction-industry labor unions, relating to the 
retention of positive evidence that they demanded recognition as the 
majority-supported collective-bargaining representative of employees in 
the building and construction industries and that the employer granted 
such recognition. See 84 FR at 39956. One commenter speculates that the 
rule will create an onerous new recordkeeping requirement under which a 
union is required to maintain records indicating its majority support 
in perpetuity.\247\ Another commenter further speculates that small 
local labor unions lack the sophisticated record-retention systems that 
would be necessary under the rule.\248\ And still another commenter 
asserts that the rule will require unions to expend funds to retain the 
evidence of majority support.\249\ No commenter has identified any such 
complex or sophisticated recordkeeping requirement.
---------------------------------------------------------------------------

    \247\ Comment of LIUNA MAROC.
    \248\ Comment of Professor Kulwiec.
    \249\ Comment of AFL-CIO.
---------------------------------------------------------------------------

    The RFA defines a ``recordkeeping requirement'' as ``a requirement 
imposed by an agency on persons to maintain specified records,'' 5 
U.S.C. 601(8), and the rule directly imposes no such requirement but we 
acknowledge the very high likelihood that small construction industry 
labor unions will choose to do so. Under this rule, however, there is 
no reason for a small labor organization to implement a record-
retention system that is more sophisticated than their normal-course-
of-business records retention. In any event, beyond familiarization 
costs, the Board finds that the rule imposes only a de minimis 
additional cost for recordkeeping, and no comment presents empirical 
evidence to the contrary.
d. Response to Comment Concerning Public Outreach
    The AFL-CIO argues that the Board failed to conduct sufficient 
outreach to small businesses, including small local unions, that will 
be impacted by the rule. Most of the issues addressed by this rule have 
been the subject of a robust public debate for several years. And in 
conjunction with the official publication of the NPRM, the Board worked 
to widely publicize the proposed rule. Upon issuance, the Board 
published the NPRM and facts sheets on its website. See NLRB, Election 
Protection Rule, https://www.nlrb.gov/about-nlrb/what-we-do/national-labor-relations-board-rulemaking/election-protection-rule (last visited 
Mar. 23, 2020). On August 9, 2019, the Board issued a press release, 
which was published on its website and distributed by email to 
subscribers, notifying the public of the proposed rule. See NLRB Office 
of Public Affairs, NLRB Proposes Rulemaking to Protect Employee Free 
Choice (Aug. 9, 2019) https://www.nlrb.gov/news-outreach/news-story/nlrb-proposes-rulemaking-protect-employee-free-choice (last visited 
Mar. 23, 2020). The press release was also shared on social media 
through the Board's official Twitter and Facebook accounts. The Board 
Members themselves have also discussed the proposed rule at various 
public speaking engagements, including the annual meeting of the Labor 
and Employment Law Section of the American Bar Association. Given the 
foregoing efforts and the many comments the Board received in response 
to the NPRM, we believe the public has been well informed, the pros and 
cons of the rule have been thoroughly examined, and the impact of the 
rule on the full range of small business entities governed by it have 
been brought into sharp focus by individuals, businesses, labor unions, 
and industry trade groups.
3. Response of the Agency to Any Comments Filed by the Chief Counsel 
for Advocacy of the Small Business Administration in Response to the 
Proposed Rule, and a Detailed Statement of any Change Made to the 
Proposed Rule in the Final Rule as a Result of the Comments
    The Chief Counsel of Advocacy of the Small Business Administration 
did not file any comments in response to the proposed rule.
4. Description of and an Estimate of the Number of Small Entities to 
Which the Rule Will Apply
    To evaluate the impact of the final rule, the Board first 
identified the universe of small entities that could be impacted by 
changes to the blocking-charge and voluntary-recognition-bar policies, 
as well as by elimination of the

[[Page 18396]]

contract language basis for 8(f) to 9(a) conversion in the construction 
industry.
a. Blocking-Charge and Voluntary-Recognition-Bar Changes
    The changes to the blocking-charge and voluntary-recognition-bar 
policies will apply to all entities covered by the National Labor 
Relations Act (``NLRA'' or ``the Act''). According to the United States 
Census Bureau, there were 5,954,684 businesses with employees in 
2016.\250\ Of those, 5,934,985 were small businesses with fewer than 
500 employees.\251\ Although this final rule would apply only to 
employers who meet the Board's jurisdictional requirements, the Board 
does not have the means to calculate the number of excluded entities 
(nor was data received on this particular issue).\252\ Accordingly, the 
Board assumes for purposes of this analysis that the rule could impact 
the great majority of the 5,934,985 small businesses.
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    \250\ See U.S. Department of Commerce, Bureau of Census, 2016 
Statistics of U.S. Businesses (SUSB) Annual Data Tables by 
Establishment Industry (Dec. 2018), https://www.census.gov/data/tables/2016/econ/susb/2016-susb-annual.html (from downloaded Excel 
Table titled ``U.S., 6-digit NAICS'').
    \251\ Id. The Census Bureau does not specifically define ``small 
business'' but does break down its data into firms with fewer than 
500 employees and those with 500 or more employees. Consequently, 
the 500-employee threshold is commonly used to describe the universe 
of small employers. For defining small businesses among specific 
industries, the standards are defined by the North American Industry 
Classification System (NAICS).
    \252\ Pursuant to 29 U.S.C. 152(6) and (7), the Board has 
statutory jurisdiction over private-sector employers whose activity 
in interstate commerce exceeds a minimal level. NLRB v. Fainblatt, 
306 U.S. 601, 606-607 (1939). To this end, the Board has adopted 
monetary standards for the assertion of jurisdiction that are based 
on the volume and character of the business of the employer. In 
general, the Board asserts jurisdiction over employers in the retail 
business industry if they have a gross annual volume of business of 
$500,000 or more. Carolina Supplies & Cement Co., 122 NLRB 88 
(1959). But shopping-center and office-building retailers have a 
lower threshold of $100,000 per year. Carol Management Corp., 133 
NLRB 1126 (1961). The Board asserts jurisdiction over non-retailers 
generally where the value of goods and services purchased from 
entities in other states is at least $50,000. Siemons Mailing 
Service, 122 NLRB 81 (1959). The following employers are excluded 
from the NLRB's jurisdiction by statute:
    Federal, state and local governments, including public schools, 
libraries, and parks, Federal Reserve banks, and wholly-owned 
government corporations. 29 U.S.C. 152(2).
    Employers that employ only agricultural laborers, those engaged 
in farming operations that cultivate or harvest agricultural 
commodities or prepare commodities for delivery. 29 U.S.C. 152 (3).
    Employers subject to the Railway Labor Act, such as interstate 
railroads and airlines. 29 U.S.C. 152(2).
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    These two changes will also impact all labor unions, as 
organizations representing or seeking to represent employees. Labor 
unions, as defined by the NLRA, are entities ``in which employees 
participate and which exist for the purpose . . . of dealing with 
employers concerning grievances, labor disputes, wages, rates of pay, 
hours of employment, or conditions of work.'' \253\ The SBA's ``small 
business'' standard for ``Labor Unions and Similar Labor 
Organizations'' is $8 million in annual receipts.\254\ In 2012, there 
were 13,740 labor unions in the U.S.\255\ Of these labor unions, 11,245 
had receipts of less than $1,000,000; 2,022 labor unions had receipts 
between $1,000,000 and $4,999,999; and 141 had receipts between 
$5,000,000 and $7,499,999. In aggregate, 13,408 labor unions (97.6% of 
total) are small businesses according to SBA standards.
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    \253\ 29 U.S.C. 152(5).
    \254\ See 13 CFR 121.201.
    \255\ The Census Bureau only provides data about receipts in 
years ending in 2 or 7. The 2017 data have not been published, so 
the 2012 data are the most recent available information regarding 
receipts. See U.S. Department of Commerce, Bureau of Census, 2012 
SUSB Annual Data Tables by Establishment Industry, https://www2.census.gov/programs-surveys/susb/tables/2012/us_6digitnaics_r_2012.xlsx (Classification #813930--Labor Unions and 
Similar Labor Organizations) (last visited Mar. 23, 2020).
---------------------------------------------------------------------------

    The blocking-charge policy change will be applied as a matter of 
law only under certain circumstances in a Board proceeding, namely, 
when a party to a representation proceeding files an unfair labor 
practice charge and requests a delay in the count of ballots or the 
certification of results after an election. Therefore, the frequency 
with which the prior blocking-charge policy arose is indicative of the 
number of small entities most directly impacted by the final rule. For 
example, in Fiscal Year 2018, 1,408 petitions were filed and proceeded 
to an election, and only 4 of those petitions were subject to a 
blocking charge. Thus, the current blocking-charge policy directly 
impacted 3.125% of petitions filed in Fiscal Year 2018, parties to 
which would only constitute a de minimis number of all small entities 
under the Board's jurisdiction.
    Similarly, the number of small entities expected to be most 
directly impacted by the modified voluntary recognition bar doctrine is 
also low. When the modified voluntary recognition bar was previously in 
effect, the Board tracked the number of requests for Dana notices, 
which were used to inform employees that a voluntary recognition had 
taken place and of their right to file a petition for an election. 
Those notices are similar to the notices that would be required under 
this final rule. From September 29, 2007, to May 13, 2011, the Board 
received 1,333 requests for Dana notices, which is an average of 372 
requests per year.\256\ Assuming each request was made by a distinct 
employer and involved at least one distinct labor organization, 
approximately 744 entities of various sizes were impacted each year 
that the modified voluntary-recognition bar was in effect.\257\ Thus, 
given our historic filing data, these numbers are very small relative 
to the number of small employers and unions subject to the NLRA and 
generally impacted by this change.
---------------------------------------------------------------------------

    \256\ Lamons Gasket, 357 NLRB at 742.
    \257\ Dana Corp., 351 NLRB at 441-442 (establishing a 45-day 
``window period'' after voluntary recognition during which employees 
could file an election petition supported by a 30-percent showing of 
interest seeking decertification or representation by an alternative 
union).
---------------------------------------------------------------------------

    Throughout the IRFA, the Board requested comments or data that 
might improve its analysis, 84 FR at 39954, 39957, but no additional 
data was received regarding the number of small entities and unions to 
which this change will apply.
b. Elimination of Contract Language Basis for Proving Majority-Based 
Recognition in the Construction Industry
    The Board believes that the proposed elimination of the contract-
language basis for proving majority-supported voluntary recognition is 
relevant only to construction-industry small employers and labor unions 
because Section 8(f) of the Act applies solely to such entities engaged 
in the building and construction industries. These construction-
industry employers are classified under the NAICS Sector 23 
Construction.\258\ Of the 640,951

[[Page 18397]]

employers included in those NAICS definitions, 633,135 are small 
employers that fall under the SBA ``small business'' standard for 
classifications in the NAICS Construction sector.\259\ In the NPRM, the 
Board identified 3,929 small labor unions primarily operating in the 
building and construction trades that fall under the SBA ``small 
business'' standard for the NAICS classification ``Labor Unions and 
Similar Labor Organizations'' of annual receipts of less than $7.5 
million.\260\ In the IRFA, the Board requested comments or data that 
might improve its analysis regarding the number of construction-
industry labor unions affected by the proposed rule, see 84 FR at 
39955, but we did not receive any additional data regarding the number 
of small labor unions to which the rule will apply.
---------------------------------------------------------------------------

    \258\ These NAICS construction-industry classifications include 
the following codes: 236115: New Single-Family Housing Construction 
(except For-Sale Builders); 236116: New Multifamily Housing 
Construction (except For-Sale Builders); 236117: New Housing For-
Sale Builders; 236118: Residential Remodelers; 236210: Industrial 
Building Construction; 236220: Commercial and Institutional Building 
Construction; 237110: Water and Sewer Line and Related Structures 
Construction; 237120: Oil and Gas Pipeline and Related Structures 
Construction; 237130: Power and Communication Line and Related 
Structures Construction; 237210: Land Subdivision; 237310: Highway, 
Street, and Bridge Construction; 237990: Other Heavy and Civil 
Engineering Construction; 238110: Poured Concrete Foundation and 
Structure Contractors; 238120: Structural Steel and Precast Concrete 
Contractors; 238130: Framing Contractors; 238140: Masonry 
Contractors; 238150: Glass and Glazing Contractors; 238160: Roofing 
Contractors; 238170: Siding Contractors; 238190: Other Foundation, 
Structure, and Building Exterior Contractors; 238210: Electrical 
Contractors and Other Wiring Installation Contractors; 238220: 
Plumbing, Heating, and Air-Conditioning Contractors; 238290: Other 
Building Equipment Contractors; 238310: Drywall and Insulation 
Contractors; 238320: Painting and Wall Covering Contractors; 238330: 
Flooring Contractors; 238340: Tile and Terrazzo Contractors; 238350: 
Finish Carpentry Contractors; 238390: Other Building Finishing 
Contractors; 238910: Site Preparation Contractors; 238990: All Other 
Specialty Trade Contractors. See U.S. Department of Commerce, Bureau 
of Census, 2012 SUSB Annual Data Tables by Establishment Industry, 
https://www2.census.gov/programs-surveys/susb/tables/2012/us_6digitnaics_r_2012.xlsx (last visited Mar. 23, 2020).
    \259\ NAICS codes 236115-237130 and 237310-237990 have a small-
business threshold of $39.5 million in annual receipts; NAICS code 
237210 has a threshold of $30 million in annual receipts; and NAICS 
codes 238110-238990 have a threshold of $16.5 million in annual 
receipts. See 13 CFR 121.201.
    \260\ See 84 FR at 39955.
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    It is unknown how many of those small construction-industry 
employers elect to enter into a 9(a) bargaining relationship with a 
small labor union based on language in a collective-bargaining 
agreement. However, again, the number of cases that involve a question 
of whether a relationship is governed by Section 8(f) or 9(a) is very 
small relative to the total number of construction-industry employers 
and unions. For example, only one case was filed in Fiscal Year 2017 
where the Board ultimately had to determine whether a collective-
bargaining agreement was governed by Section 8(f) or 9(a).\261\ In 
Fiscal Year 2016, no cases required the Board to determine whether a 
collective-bargaining agreement was governed by 8(f) or 9(a). One case 
was filed in Fiscal Year 2015 that came before the Board with the 8(f) 
or 9(a) collective-bargaining agreement issue.\262\
---------------------------------------------------------------------------

    \261\ See AFP Specialties, Inc., Case 07-RD-187706, 2017 WL 
2212112, at *1 fn.1 (May 18, 2017).
    \262\ See Loshaw Thermal Technology, LLC, Case 05-CA-158650, 
2018 WL 4357198.
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    The historic filing data thus suggests that construction-industry 
employers and labor unions will only be most directly impacted in a 
small number of instances relative to the number of those types of 
small entities identified above.
5. Description of the Projected Reporting, Recordkeeping, and other 
Compliance Requirements of the Rule, Including an Estimate of the 
Classes of Small Entities Which will be Subject to the Requirement and 
the Type of Professional Skills Necessary for Preparation of the Report 
or Record
    The RFA requires agencies to consider the direct burden that 
compliance with a new regulation will likely impose on small 
entities.\263\ Thus, the RFA requires the Board to determine the amount 
of ``reporting, recordkeeping and other compliance requirements'' 
imposed on small entities. In providing its final regulatory 
flexibility analysis, an agency may provide either a quantifiable or 
numerical description of the effects of a rule or alternatives to the 
rule, or ``more general descriptive statements if quantification is not 
practicable or reliable.'' \264\
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    \263\ See Mid-Tex Elec. Coop., Inc. v. FERC, 773 F.2d at 342 
(``[I]t is clear that Congress envisioned that the relevant 
`economic impact' was the impact of compliance with the proposed 
rule on regulated small entities.'').
    \264\ See 5 U.S.C. 603(b)(4), 604(a)(4).
---------------------------------------------------------------------------

    We conclude that the final rule imposes no capital costs for 
equipment needed to meet the regulatory requirements; no lost sales and 
profits resulting from the proposed rule; no changes in market 
competition as a result of the proposed rule and its impact on small 
entities or specific submarkets of small entities; and no costs of 
hiring employees dedicated to compliance with regulatory requirements.
    Small entities may incur some costs from reviewing the rule in 
order to understand the substantive changes. To become generally 
familiar with the new vote-and-impound or vote-and-count procedures and 
the modified voluntary-recognition bar, we estimate that a human-
resources specialist at a small employer or labor union may take at 
most 90 minutes to read the rule. It is also possible that a small 
employer or labor union may wish to consult with an attorney, which we 
estimate will require 1 hour. Using the Bureau of Labor Statistics' 
estimated wage and benefit costs, the Board has assessed these labor 
costs to be $164.51.\265\ The costs associated with the portion of the 
rule that eliminates the contract-language basis for establishing 
voluntary recognition under Section 9(a) are limited to small employers 
and unions in the construction industry. To become generally familiar 
with that change, in addition to the first two changes, we estimate 
that a human-resources specialist at a small employer or union in the 
construction industry may take at most 2 hours to read the entire rule. 
Consultation with an attorney may take an additional 15 minutes, or 75 
minutes to consult with an attorney regarding the entire rule. Thus, 
the Board has assessed labor costs for small employers and unions in 
the construction industry to be $211.25.
---------------------------------------------------------------------------

    \265\ For wage figures, see May 2018 National Occupancy 
Employment and Wage Estimates, found at https://www.bls.gov/oes/current/oes_nat.htm (last visited Mar. 23, 2020). The Board has been 
administratively informed that BLS estimates that fringe benefits 
are approximately equal to 40 percent of hourly wages. Thus, to 
calculate total average hourly earnings, BLS multiplies average 
hourly wages by 1.4. In May 2018, average hourly wages for a Human 
Resources Specialist (BLS #13-1071) were $32.11. The same figure for 
a lawyer (BLS #23-1011) was $69.34. Accordingly, the Board 
multiplied each of those wage figures by 1.4 and added them to 
arrive at its estimate. In the IRFA, we estimated these costs using 
May 2017 National Occupancy Employment and Wage Estimates.
---------------------------------------------------------------------------

a. Costs Associated With Establishment of Vote and Impound or Vote-and-
Count Procedures
    Although we do not foresee any additional compliance costs related 
to eliminating the blocking-charge policy, this policy change would 
cause some elections to occur sooner, and in some cases would lead to 
elections that previously would not have occurred. Arguably, the time 
compression of holding an election under the Board's typical election 
timeline may create additional costs for small businesses that do not 
have in-house legal departments or ready access to outside labor 
attorneys or consultants, and that consequently need to pay to obtain 
such assistance. Conversely, because the Board's current blocking-
charge policy appears susceptible to manipulation and abuse, the 
elimination of that policy may result in fewer unfair labor practice 
charges filed with the intent to forestall employees from exercising 
their right to vote. This would reduce some costs for small employers 
by eliminating the need to hire a labor attorney to defend against such 
charges. It could also create additional costs for small labor unions 
that have to prepare for an election that may have otherwise been 
postponed or that may subsequently be set aside. In the IRFA, the Board 
requested comments or data that might improve its analysis regarding 
the estimated cost for preparing and participating in elections, see 84 
FR at 39956, but--other than the AFL-CIO's comment referenced above--we 
received no additional data regarding the average cost for preparing 
for or participating in a Board election.

[[Page 18398]]

    The Board believes that any costs from participating in quicker 
elections or elections that would have not otherwise occurred are 
limited to very few employers, comparing the limited number of Board 
proceedings where an unfair labor practice charge has been filed 
contemporaneously with an election petition with the high number of 
employers that are subject to the Board's jurisdiction.
b. Costs Associated With Modification of the Voluntary-Recognition Bar
    In a case in which an employer voluntarily recognizes a union, we 
estimate that the employer will spend an estimated 1 hour and 45 
minutes to comply with the rule. This includes: 30 minutes for the 
employer (or union) to notify the local regional office of the Board in 
writing of the grant of voluntary recognition by submitting a copy of 
the recognition agreement; 60 minutes to open the notice sent from the 
Board, insert certain information specific to the parties to the 
voluntary recognition, post the notice physically and electronically 
(depending on where and how the employer customarily posts notices to 
employees), and distribute it electronically (if the employer 
customarily communicates with employees electronically); and 15 minutes 
to complete the certification-of-posting form to be returned to the 
Region at the close of the notice-posting period. We assume that these 
activities will be performed by a human-resources specialist for a 
total cost of about $78.66.
    The Board's modified voluntary-recognition bar will cause elections 
to be held in a small number of cases in which the election petition 
previously would have been dismissed, increasing costs for both 
employers and unions. As stated previously, in the IRFA, the Board 
requested comments or data that might improve its analysis regarding 
the estimated cost for preparing for and participating in elections, 
including those after a grant of voluntary recognition, see 84 FR at 
39956, but we received no additional data, other than the AFL-CIO's 
comment referenced above.
c. Costs Associated With Elimination of Contract-Language Basis for 
Proving Majority-Based Recognition in the Construction Industry
    Under current Board law, a construction-industry employer and union 
can write into their collective-bargaining agreement that the union 
showed or offered to show evidence of majority support and, in 
combination with certain other contractual language, have the 
bargaining relationship be governed under Section 9(a) as opposed to a 
presumed 8(f) bargaining relationship. As described above, the final 
rule eliminates the contract-language basis for establishing a 9(a) 
bargaining relationship and thereby barring a petition in a 
representation proceeding. However, the rule continues to allow two 
other methods to establish a 9(a) bargaining relationship: a Board-
certified election and voluntary recognition based on demonstrated 
majority support. In the handful of cases where an election petition is 
filed involving one of the approximately 6 million small entities in 
the United States, both the construction industry employer and labor 
union would incur the cost of participating in an election. As noted 
above, we are unable to quantify the cost of preparing for or 
participating in a Board election. In cases where a construction-
industry employer voluntarily recognizes a union based on demonstrated 
majority support, the union may incur an additional de minimis cost 
related to the retention of the evidence of majority support, e.g., 
signed union authorization cards, for a longer period of time if it can 
no longer rely on contractual language. No data or comments were 
received relating to such costs, other than those comments described 
above.
d. Overall Costs
    We do not find the estimated $164.51 cost to small employers and 
unions in order to review and understand the petition-processing 
procedures and the modified voluntary recognition bar, or the estimated 
$78.66 cost for an employer to comply with the notice requirements of 
the modified recognition bar, to be significant within the meaning of 
the RFA. We find the same with regard to the estimated cost of $211.25 
for small employers and unions in the construction industry to review 
and understand the elimination of the contract-language basis for 
establishing voluntary recognition under Section 9(a), in addition to 
the first two changes. In making these findings, one important 
indicator is the cost of compliance in relation to the revenue of the 
entity or the percentage of profits affected. Other criteria to be 
considered are the following:
--Whether the rule will cause long-term insolvency, i.e., regulatory 
costs that may reduce the ability of the firm to make future capital 
investment, thereby severely harming its competitive ability, 
particularly against larger firms;
--Whether the cost of the proposed regulation will (a) eliminate more 
than 10 percent of the businesses' profits; (b) exceed one percent of 
the gross revenues of the entities in a particular sector, or (c) 
exceed five percent of the labor costs of the entities in the sector.
    The minimal cost to read and understand the rule, $164.51 or 
$211.25, will not generate any such significant economic impacts, nor 
will the minimal cost, $289.91 for employers to comply with the 
modified recognition-bar notice posting.
6. Description of the Steps the Agency Has Taken To Minimize the 
Significant Economic Impact on Small Entities Consistent With the 
Stated Objectives of Applicable Statutes, Including a Statement of the 
Factual, Policy, and Legal Reasons for Selecting the Alternative 
Adopted in the Final Rule and Why Each one of the Other Significant 
Alternatives to the Rule Considered by the Agency Which Affect the 
Impact on Small Entities was Rejected
    Pursuant to 5 U.S.C. 604(a)(6), agencies are directed to examine 
``why each one of the other significant alternatives to the rule 
considered by the agency which affect the impact on small entities was 
rejected.'' In the IRFA, the Board requested comments identifying any 
other issues and alternatives that it had not considered. See 84 FR at 
39957.
    Many comments suggested that the Board withdraw the proposed rule 
and leave in place the current blocking-charge policy, voluntary-
recognition bar, and requirement of proof to show majority-based 
recognition in the construction industry. We considered and rejected 
these alternatives for the reasons stated above. Consequently, we 
reject maintaining the status quo.
    The AFL-CIO suggests several alternatives to the proposed 
modification to the blocking-charge policy, including expedited 
investigation of possible blocking charges, periodic review of charges 
that are blocking an election, instructing regional directors to make 
fuller use of their existing discretion to not block elections, 
expanding exceptions in the blocking-charge policy, or limiting the 
application of the new rule to charges not filed by the 
petitioner.\266\ We have discussed, and rejected, these alternatives 
for the reasons discussed in Section III.E. above.
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    \266\ CWA similarly stresses the existing discretion afforded to 
regional directors as to whether to process a petition and conduct 
an election if a charge and request to block an election has been 
filed.

---------------------------------------------------------------------------

[[Page 18399]]

    In the NPRM, the Board considered exempting certain small entities. 
See 84 FR at 39957. We received no comments on this potential 
alternative and again reject this exemption as impractical because such 
a large percentage of employers and unions would be exempt under the 
SBA definitions, thereby substantially undermining the purpose of the 
final rule. Additionally, given the very small quantifiable cost of 
compliance, it is possible that the burden on a small business of 
determining whether it fell within a particular exempt category might 
exceed the burden of compliance. Congress gave the Board very broad 
jurisdiction, with no suggestion that it wanted to limit coverage of 
any part of the Act to only larger employers. As the Supreme Court has 
noted, ``[t]he [NLRA] is federal legislation, administered by a 
national agency, intended to solve a national problem on a national 
scale.'' NLRB v. Hearst Publ'ns, 322 U.S. 111, 123 (1944). As such, 
this alternative is contrary to the objectives of this rulemaking and 
of the NLRA.
    None of the alternatives considered would adequately accomplish the 
primary objective of issuing this rule--protection of employee free 
choice--while minimizing costs on small businesses. Accordingly, we 
believe that promulgating this final rule is the best regulatory course 
of action.

B. Paperwork Reduction Act

    In the NPRM, the Board explained that the proposed rule would not 
impose any information-collection requirements and accordingly, the 
proposed rule is not subject to the Paperwork Reduction Act (PRA), 44 
U.S.C. 3501 et seq. See 84 FR at 39957. We have not received any 
substantive comments relevant to the Board's analysis of its 
obligations under the PRA.

C. Congressional Review Act

    The three provisions of the final rule are substantive, and the 
Board will submit this rule and required accompanying information to 
the Senate, the House of Representatives, and the Comptroller General 
as required by the Small Business Regulatory Enforcement Fairness Act, 
Subtitle E (the Congressional Review Act or CRA), 5 U.S.C. 801-808. 
Pursuant to the Congressional Review Act, the Office of Information and 
Regulatory Affairs designated this rule as a major rule. Accordingly, 
the rule will become effective June 1, 2020.

VI. Final Rule

    For the reasons set forth in the preamble, the National Labor 
Relations Board amends part 103 of title 29 of the Code of Federal 
Regulations as follows.

List of Subjects in 29 CFR Part 103

    Jurisdictional standards, Election procedures, Appropriate 
bargaining units, Joint Employers, Remedial Orders.

PART 103--OTHER RULES

0
1. The authority citation for part 103 continues to read:

    Authority:  29 U.S.C. 156, in accordance with the procedure set 
forth in 5 U.S.C. 553.


0
2. Revise Sec.  103.20 to read as follows:


Sec.  103.20   Election procedures and blocking charges.

    (a) Whenever any party to a representation proceeding files an 
unfair labor practice charge together with a request that the charge 
block the election process, or whenever any party to a representation 
proceeding requests that its previously filed unfair labor practice 
charge block the election process, the party shall simultaneously file, 
but not serve on any other party, a written offer of proof in support 
of the charge. The offer of proof shall provide the names of the 
witnesses who will testify in support of the charge and a summary of 
each witness's anticipated testimony. The party seeking to block the 
election process shall also promptly make available to the regional 
director the witnesses identified in its offer of proof.
    (b) If charges are filed alleging violations other than those 
described in paragraph (c) of this section, the ballots will be 
promptly opened and counted at the conclusion of the election.
    (c) If charges are filed that allege violations of section 8(a)(1) 
and 8(a)(2) or section 8(b)(1)(A) of the Act and that challenge the 
circumstances surrounding the petition or the showing of interest 
submitted in support of the petition, or a charge is filed that alleges 
an employer has dominated a union in violation of section 8(a)(2) and 
seeks to disestablish a bargaining relationship, the regional director 
shall impound the ballots for up to 60 days from the conclusion of the 
election if the charge has not been withdrawn or dismissed prior to the 
conclusion of the election. If a complaint issues with respect to the 
charge at any point prior to expiration of that 60-day post-election 
period, then the ballots shall continue to be impounded until there is 
a final determination regarding the charge and its effect, if any, on 
the election petition. If the charge is withdrawn or dismissed at any 
time during that 60-day period, or if the 60-day period ends without a 
complaint issuing, then the ballots shall be promptly opened and 
counted. The 60-day period will not be extended, even if more than one 
unfair labor practice charge is filed serially.
    (d) For all charges described in paragraphs (b) or (c) of this 
section, the certification of results (including, where appropriate, a 
certification of representative) shall not issue until there is a final 
disposition of the charge and a determination of its effect, if any, on 
the election petition.

0
3. Add Sec.  103.21 to read as follows:


Sec.  103.21   Processing of petitions filed after voluntary 
recognition.

    (a) An employer's voluntary recognition of a labor organization as 
exclusive bargaining representative of an appropriate unit of the 
employer's employees under section 9(a) of the Act, and the first 
collective-bargaining agreement executed by the parties on or after the 
date of such voluntary recognition, will not bar the processing of an 
election petition unless:
    (1) The employer and/or the labor organization notifies the 
Regional Office that recognition has been granted;
    (2) The employer posts, in conspicuous places, including all places 
where notices to employees are customarily posted, a notice of 
recognition (provided by the Regional Office) informing employees that 
recognition has been granted and that they have a right to file a 
petition during a 45-day ``window period'' beginning on the date the 
notice is posted;
    (3) The employer distributes the notice described in paragraph 
(a)(2) of this section electronically to employees in the petitioned-
for unit, if the employer customarily communicates with its employees 
electronically; and
    (4) 45 days from the posting date pass without a properly supported 
petition being filed.
    (5) The notice described in paragraph (a)(2) of this section shall 
state as follows:

    Federal law gives employees the right to form, join, or assist a 
union and to choose not to engage in these protected activities.
    An employer may lawfully recognize a union based on evidence 
(such as signed authorization cards) indicating that a majority of 
employees in an appropriate bargaining unit desire its 
representation, without an election supervised by the National Labor 
Relations Board.
    Once an employer recognizes a union as the employees' exclusive 
bargaining representative, the employer has an obligation to bargain 
with the union in good

[[Page 18400]]

faith in an attempt to reach a collective-bargaining agreement, and 
that obligation is not delayed or otherwise impacted by this notice.
    The National Labor Relations Board is an agency of the United 
States Government and does not endorse any choice about whether 
employees should keep the recognized union, file a petition to 
certify the recognized union, file a petition to decertify the 
recognized union, or support or oppose a representation petition 
filed by another union.
    [Employer] on [date] recognized [Union] as the employees' 
exclusive bargaining representative based on evidence indicating 
that a majority of employees in [described bargaining unit] desire 
its representation.
    All employees, including those who previously signed cards in 
support of [Union], have the right to be represented by a union of 
their choice or by no union at all.
    Within 45 days from the date of this notice, a petition 
supported by 30 percent or more of the unit employees may be filed 
with the National Labor Relations Board for a secret-ballot election 
to determine whether or not the unit employees wish to be 
represented by [Union], or 30 percent or more of the unit employees 
can support another union's filing of a petition to represent them.
    Any properly supported petition filed within the 45-day window 
period will be processed according to the National Labor Relations 
Board's normal procedures.
    A petition may be filed within the 45-day window period even if 
[Employer] and [Union] have already reached a collective-bargaining 
agreement.
    If no petition is filed within the 45-day window period, the 
Union's status as the unit employees' exclusive bargaining 
representative will be insulated from challenge for a reasonable 
period of time, and if [Employer] and [Union] reach a collective-
bargaining agreement during that insulated reasonable period, an 
election cannot be held for the duration of that collective-
bargaining agreement, up to 3 years.

    (b) This section shall be applicable to an employer's voluntary 
recognition on or after the effective date of this rule.

0
4. Add Sec.  103.22 to read as follows:


Sec.  103.22   Proof of majority-based bargaining relationship between 
employer and labor organization in the construction industry.

    (a) A voluntary recognition or collective-bargaining agreement 
between an employer primarily engaged in the building and construction 
industry and a labor organization will not bar any election petition 
filed pursuant to section 9(c) or 9(e) of the Act absent positive 
evidence that the union unequivocally demanded recognition as the 
section 9(a) exclusive bargaining representative of employees in an 
appropriate bargaining unit, and that the employer unequivocally 
accepted it as such, based on a contemporaneous showing of support from 
a majority of employees in an appropriate unit. Collective-bargaining 
agreement language, standing alone, will not be sufficient to provide 
the showing of majority support.
    (b) This section shall be applicable to an employer's voluntary 
recognition extended on or after the effective date of this rule and to 
any collective-bargaining agreement entered into on or after the date 
of voluntary recognition extended on or after the effective date of 
this rule.

    Dated: March 24, 2020.
Roxanne L. Rothschild,
Executive Secretary.
[FR Doc. 2020-06470 Filed 3-31-20; 8:45 am]
 BILLING CODE 7545-01-P