NLRB
Removes “Salt” From Employers’ Wounds
On
May 31, 2007, by a vote of 3-2, the National Labor Relations Board
("Board"), reversed its traditional practice of applying a rebuttable
presumption of employment for an “indefinite period” for purposes of computing
backpay damage awards in unfair labor practice cases involving union “salts.” In so doing, it acknowledged what many employers
claimed was an inherent disparity between the union’s/salt’s intentions of employment
for only a limited period and the indefinite penalty imposed on employers in
such cases. Oil Capital Sheet Metal,
Inc., 349 NLRB No. 118 (2007).
The practice of “salting” is not a
new tactic in union organizing. The
general concept of salting is that the union sends out one or more union
organizers (sometimes paid, sometimes not) to a targeted employer’s premises to
apply for employment. Sometimes these
applicants approach employment and the concept of organizing from a “covert”
perspective, meaning that they actually want to gain employment with the
employer so they can then work to organize the employer from the inside –
working cheek to jowl with the other employees and using the access that their
employment position affords. However, in
“overt” salting cases applicants often wear union insignia to the interview or indicate
that they are a “paid union organizer” or signify other union affiliation on
the application or during the interview process. The union’s objective in such instances is
not always truly organizational in nature, but rather is often “to precipitate
the commission of unfair labor practices by startled employers,” or in other
words, to “result in heavy backpay costs to the employer and weaken his ability
to fight future organizing efforts (since his freedom of action will be limited
by the cease and desist order that the Board will enter).” In either case, the union and the salt may
not intend the employment relationship to last indefinitely, but rather “only
until the union’s defined objectives are achieved or abandoned.”
Traditionally, once the Board has
found that an employer unlawfully refused to hire, or terminated a union salt,
it applied a rebuttable presumption that the backpay period “should extend
indefinitely from the date of the discriminatory discharge or refusal to hire
until the [employer] extends a valid job offer to the discriminatee.” This is the same method of determining
backpay damages used in all other failure to hire or termination cases such as
where a long-standing employee was fired for union activity. In the construction industry, the Board also
applied a presumption that the salt would have been transferred to other
jobsites when the job for which he was hired came to an end. The burden of disproving the
indefinite period of employment rested entirely with the employer. In Board cases that can often last for months
or even years, the backpay amount is frequently significant and is compounded
when several salts are involved.[1]
In the case at hand, Oil Capital
Sheet Metal, Inc. had placed an ad for employees in a local paper. A union organizer appeared on May 5, 1998, and
applied for employment. He was wearing a
union t-shirt and indicated his union experience on his application.[2] He was not hired. The Board upheld its administrative law
judge's decision that the employer knew he was a salt and that it had
unlawfully failed or refused to hire him.
As such, the Board affirmed that the employer had violated the NLRA and held, consistent with its previous decisions, that
the salt was eligible for backpay as a remedy for the unfair labor practice.
However, the Board stated that it’s “traditional presumption
with respect to the duration of the backpay period is suspect in the
case of a union salt, and we will no longer apply it.” (emphasis added). With regard to transfers to a
construction-industry employer’s other jobsites, the Board added that, “even if
the employer’s practice was to [make transfers], the issue of whether the
employee would, in fact, have transferred may ultimately depend on whether the
union wished to organize the new site, which is a matter peculiarly within the
union’s knowledge.” And thus, the
decision illuminated one of the major bases for this change in precedent –
namely, that “union salts, unlike other applicants, do not typically seek
employment for an indefinite duration,” and the traditional presumption “can
result in backpay awards spanning several years, [which] strains common sense .
. . .” The Board also specifically noted
the potential punitive nature of such a remedy, which in this case “would
presumptively cover more than eight years.”
The Board illustrated this point with reference to a previous decision
where it had ordered lost earnings in a salting case for a full five-year
backpay period because the employer had failed to prove that such a
period was “unreasonable.”
The Board also seized on the fact that the employer
generally does not have in its possession the evidence necessary to rebut the indefinite
duration presumption; but, rather “evidence about the likely duration of a
salt’s employment is in the possession of the union, as the campaign’s
progenitor and director, and of the salt participant in the campaign.” As such, the Board held that it was therefore
“appropriate to place the burden on the union and the salt/discriminatee.” Such evidence could include the salt’s
“personal circumstances, contemporaneous union policies and practices with
respect to salting campaigns, specific plans for the targeted employer,
instructions or agreements between the salt/discriminatee
and the union concerning the anticipated duration of the assignment, and
historical data regarding the duration of employment of the salt/discrminatee and other salts in similar salting
campaigns.” Regardless of the method of
proof employed, the decision makes it clear that it is now the union’s burden,
through the General Counsel, to prove damages.
The Oil Capital decision is a striking departure from
previous Board authority. An appeal to
the federal courts is likely. In the
meantime, however, the Board and its various regional offices will be bound to
apply the new remedy in all pending proceedings. Whether or not one agrees with underlying
reasoning of the decision, it will – at least for the time being – have a very
practical and tangible effect on unions and employers trying to figure backpay
remedies in these cases. Unions will
bear an evidentiary burden of establishing the probable duration of employment,
which could mean introducing discussions about and plans of organizing tactics,
which they may be reluctant to do. For
Employers actually facing a salting backpay remedy, however, the decision's
practical effect is not just the shift of the burden of proof but the removal of
some, but not all, of the “salt” from their wounds.
Ryan Poor and Michael Boldt
are partners in the Firm's Labor and Employment Practice Group. If you have questions regarding
"salting" or other labor employment issues, you can contact Ryan at ryan.poor@icemiller.com or Michael at michael.boldt@icemiller.com.
This publication is intended for general information purposes only and
does not and is not intended to constitute legal advice. The reader must
consult with legal counsel to determine how laws or decisions discussed herein
apply to the reader's specific circumstances.