New General Counsel Memo Highlights Key NLRB Priorities, Areas For Employer Caution

• Published date: 19 August 2021
• Subject Matter: Employment and HR, Employment Litigation/ Tribunals, Employee Rights/ Labour Relations
• Law Firm: Akin Gump Strauss Hauer & Feld LLP
• Author: Mr Robert G. Lian Jr. and James C. Crowley

Key Points

• On August 12, 2021, the National Labor Relations Board's (NLRB) recently appointed General Counsel issued a memorandum requiring reexamination of labor law doctrine in several key areas.
• The memorandum is important because it signals a new direction for the NLRB in the Biden-Harris administration. A change in the legal landscape could expand the circumstances in which businesses risk union organizing and litigation for unfair labor practices under the National Labor Relations Act (NLRA).
• The memorandum has significant implications not just for employers with unionized workforces, but for nonunionized employers, including companies that use independent contractors franchisors and private equity firms in regard to their relationships with portfolio companies.

On August 12, 2021, the NLRB's newly-confirmed General Counsel issued a memorandum flagging several workplace issues for reexamination. The memorandum requires the NLRB's Regional Directors to submit these issues to the "Advice Branch" to determine whether to prosecute employers that may otherwise be in compliance with existing law. Prosecutions over these issues could shift precedents and expand application of the NLRA, affecting both union and non-union employers.

By way of background, the NLRA gives employees the right to join together to bargain collectively with their employers. It also seeks to secure for employees the liberty to join unions'and not to join unions. In seeking to balance these sometimes competing objectives, Congress provided the NLRB an enforcement regime to police employers and unions so that they may not restrain or coerce employees into engaging in protected activities.

Unlike most federal agencies that announce and implement new rules through the notice-and-comment rulemaking process, the NLRB has historically issued new rules through the adjudication of individual cases. ¹

While the law can change in unanticipated ways, the NLRB General Counsel enforcement priorities often foretell a change in direction. The August 12, 2021 General Counsel memorandum signals the potential for changes in the following critical areas:

• Employees and independent contractors: Companies often face challenges in answering what might seem like a basic question'is a worker the employee of that company? In many industries, the answer turns on whether a worker is properly classified as an independent contractor. The legal standard used by the NLRB has significant implications for...