Boeing and the NLRB

October 3, 2011 

— Recently, Boeing decided to locate a new, non-union, manufacturing line in South Carolina, rather than at its unionized facility in Washington State. In the aftermath of that decision, elected officials have publicly castigated a federal agency, challenged that agency's independence and even threatened one agency official with contempt of Congress. Unfortunately, these actions have largely been based on inaccuracies about the case.

The agency involved is the National Labor Relations Board, which enforces the central private-sector labor law in this country, the National Labor Relations Act. Following a charge filed by the machinists union representing Boeing's Washington employees, the NLRB's general counsel investigated, unsuccessfully sought to settle the dispute and ultimately filed a complaint alleging that Boeing violated the NLRA. Boeing and its supporters argue that the NLRB is asserting an unprecedented power to stop companies from deciding where to operate. Reality, however, falls far short of this claim.

Most significantly, the NLRB has not said anything about the legality of Boeing's actions. Members of the NLRB - which consists of up to five presidential appointees, two of whom are traditionally nominated by the party not in control of the White House - act like judges in cases brought against unions and employers alleged to have violated the NLRA. But the Boeing matter has not reached the NLRB.

Thus far, the only thing that has happened is that the NLRB's general counsel - a separate appointee whose office investigates and litigates cases - has found enough evidence to support the filing of a complaint against Boeing, which will be litigated before an administrative law judge. Neither that judge, nor the NLRB, has made findings on the facts or law of the case.

Moreover, contrary to the claims of Boeing's supporters, the general counsel has not sought to close down the South Carolina facility and move those jobs to Washington. It is true that the general counsel will request that Boeing give the Washington employees any work that was moved illegally to South Carolina. But Boeing would remain free to give its South Carolina facility as much work as it wants, as long as it does so for valid reasons.

What constitutes a valid reason leads to a central question: why did the general counsel bring a case against Boeing?

It is not in an attempt to assist a union or prevent employers from making decisions based on economics. Indeed, employers usually have free rein to decide where and how to operate. However, one exception is that an employer cannot punish employees in an attempt to encourage or discourage union activity.

The reason is that if employers could retaliate against employees for exercising their labor rights, those rights would not be worth much. It is this principle that is motivating the general counsel, who is arguing that statements by Boeing officials show that its decision to operate in South Carolina was based not on labor costs, but was an attempt to retaliate against Washington employees' past use of their right to strike.

The difficulty is that it is hard to determine an employer's intent. That is why an administrative law judge is holding a hearing to evaluate the parties' documents and witness testimony. Without this evidence, no one can know what will happen once the hearing is completed. For instance, the judge or, later, the NLRB could decide that Boeing did not intend to discourage union activity and reject the complaint.

The real scandal in this case is not the general counsel's complaint against Boeing, but the attempt to interfere with an independent agency's adjudication process.

U.S. Rep. Darryl Issa, chair of the House Committee on Government Oversight and Reform, as well as numerous other elected officials, has engaged in a campaign to influence the NLRB's decision. And now, after holding a hearing on the case and repeatedly castigating the NLRB in the press, the committee has issued a grossly overbroad subpoena and threatened the general counsel with contempt of Congress if he refuses to comply.

Not to be left out, South Carolina Gov. Nikki Haley urged the Republican member of the NLRB to resign so that the agency could no longer fulfill its duty to enforce the law.

One can only imagine what these officials' reaction would be if a similar effort were made to stop one of the many cases that the NLRB brings against unions.

Using half-truths and bullying to interfere with an ongoing case serve only to undermine the concept of justice. Let's wait and see what the evidence looks like and how the NLRB interprets it. Then we can have a useful discussion about whether the agency is properly enforcing the NLRA and whether that law should be amended.

Jeffrey Hirsch, who was an NLRB attorney from 2000 to 2004, is a professor at the UNC School of Law specializing in labor and employment law.

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