NLRB: Can’t Tell Employees To Lump It or Leave It

Employers might be shocked to find how far the federal government will go in using the National Labor Relations Act to reach into the relationship between employee and employer. In a recent case, the National Labor Relations Board pursued a case on behalf of a single employee against a small-time used car dealer. It should be a wake-up call.

The act was originally designed to govern the relationship between unions and large employers. However, the act also provides rights for individual employees to engage in “protected concerted activity.” That is defined as two or more employees taking action for their mutual aid or protection regarding the terms and conditions of employment. Courts have stretched the definition to include a single employee acting on the authority of other employees to bring group complaints to the employer’s attention, trying to induce group action or seeking to prepare for group action.

The scope of an individual employee’s rights under the Act was the subject of  the recent case against Plaza Auto Center in Yuma, Arizona. The case arose out of several conflicts between the used-car dealership and newly-hired salesman Nick Aguirre. On multiple occasions in his two-month employment, Aguirre questioned and complained about the company’s policies on employee breaks and commission-only compensation. He was told several times that if he didn’t like Plaza Auto Center’s policies, he could leave the job and find work elsewhere.

After hearing that Aguirre was complaining, the company’s owner asked to meet with him. In the meeting, Aguirre aired his grievances to the owner and two supervisors about the company’s commission compensation. He was again told, “If he did not trust the company, he need not work there.”

Aguirre lost his temper and began loudly hurling insults and offensive names at the owner. During the outburst, Aguirre stood up, pushed his chair aside and told the owner that he would be sorry if he was fired. Aguirre was fired on the spot.

The NLRB took up Aguirre’s claim and contended that the company’s “work elsewhere if you don’t like it” response to Aguirre’s concerns about breaks and compensation was unlawful under the Act. The federal Court of Appeals for the Ninth Circuit agreed.

The NLRB also found that the company could not lawfully terminate Aguirre because his tirade wasn’t enough to forfeit his legally protected right to complain about his pay and working conditions. The NLRB said Aguirre would have to engage in physically threatening or intimidating conduct in order to lose his protection.

On this point, however, the federal court did not agree. The court noted that the NLRB did not follow its own prior rulings, which did not require a threat of violence. These rulings made clear that an employee can lose the protections through a verbal outburst, regardless of the merit of his complaints.

What employers can learn from this recent case:

• Telling an employee to lump it or leave it in response to a complaint about pay or working conditions can itself be unlawful under the Act.

• Employees who complain about pay or working conditions can lose the protections of the Act, if they engage in offensive tirades. They do not have to make threats of physical violence to lose the protection.

• The NLRB will devote significant resources to pursue an action against a very small employer based upon the borderline conduct of a single employee.

• The NLRB will quickly depart from its own past rulings to achieve a result, a problem that necessitates appeals to the federal courts. While the courts may correct much of the NLRB’s employee-biased exuberance, the cost is very high to the employers impacted by it.