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"Obama Board" Tips The Scale Towards Labor In Long-Awaited Secondary Boycott Decision

MSK Client Alert
September 8, 2010

by Anthony J. Amendola and Jennifer A. Zimbroff

In a decision announced on September 2, 2010, the newly constituted National Labor Relations Board (NLRB or Board), with three new members appointed by President Obama, ruled that a union may display large stationary banners in front of a neutral employer’s business in order to alert the public that the neutral employer is doing business with a non union employer with whom the union has a dispute. This long-awaited decision, the first of significance made by the Obama Board, signals a clear shift in American labor policy.


Section 8(b)(4)(ii)(B) of the National Labor Relations Act (NLRA) makes it unlawful for a union to "threaten, coerce, or restrain" a secondary employer not directly involved in a primary labor dispute with the objective of "forcing or requiring any person to... cease doing business with any other person." Applying this prohibition on secondary boycotts, the NLRB has long considered picketing that encourages consumers to boycott a "secondary" or "neutral" employer to be unlawful. However, passing out handbills with the same goal of encouraging consumers to boycott secondary employers has not been considered unlawful.

The new decision, United Brotherhood of Carpenters and Joiners of America, Local 1506, 355 NLRB No. 159, consolidates three cases in which the carpenters union held fifteen-to twenty-foot-long and three-to four-foot high banners near two medical centers and a restaurant to protest work being done by non union construction contractors doing work for these neutral businesses. It was undisputed that the neutral employers had no collective-bargaining relationship with the union, and the union was not seeking to organize their employees. Rather, the union’s dispute was with the non union construction contractors (the primary employers), which the union asserted were paying wages and benefits below area standards.

At each site, two to four union representatives held the banners but did not patrol with them. At the medical centers, the banners read "Labor Dispute" and "SHAME ON [name of the hospital]," while at the restaurant the banner read "DON’T EAT 'RA’ SUSHI," as well as "Labor Dispute." Significantly, the construction work at issue was not even being performed at each of the sites where the "bannering" took place. In addition, handbills also were distributed simultaneously to interested members of the public, explaining the union’s complaints with these primary employers, the non union construction companies.

The NLRB’s Decision

The question presented was whether the "bannering" of neutral employers more closely resembled unlawful picketing or lawful handbilling. In the 3-2 decision, the NLRB determined that, unlike picketing, the "bannering" was a noncoercive, nonintimidating, nonthreatening activity, analogous to handbilling, and therefore permitted under the NLRA. The Board noted that there was no chanting, yelling, marching, or blockage of traffic or sidewalks. Banners were at a sufficient distance from entrances to avoid confrontation with customers and patients, and the messages were directed at passing traffic. There was no indication, the majority concluded, that anything in the legislative history suggested that Congress intended to prohibit peaceful, stationary display of a banner on a public sidewalk and that such activity was not akin to or subsumed in the more confrontational activity of picketing. It went on to argue that the opposite finding would raise a "serious constitutional" free-speech issue, particularly if there exists no "confrontational" activity like creating an actual or symbolic blocking of entry to the secondary employer’s business.

In a sharply worded dissent, the Republican members of the Board argued that the union’s conduct was indeed coercive and aimed to have the public cease doing business with the neutral hospitals and restaurant:

the [Union] sought to bring about a consumer boycott of the neutrals through the posting of its agents, with massive banners, adjacent to the entrance of the neutrals’ premises. This conduct was the confrontational equivalent of picketing, and thus proscribed by Section 8(b)(4)(ii) within the meaning of the statute, legislative history, and precedent... Customers about to enter the neutral premises encountered union agents, readily identifiable as such, posted by the [Union] and holding large signs, albeit ones stretched between two poles rather than affixed to a single picket, misleadingly claiming the existence of a 'labor dispute’ with the neutral employers.

The dissent also predicted that the decision would incite a "dramatic increase in secondary boycott activity." 

Ask MSK - Q&A Section

Q: Must the bannering of secondary employers occur at the actual site of the construction or other work being done by the primary employer?

A: No. In two of the three cases under discussion, the primary employers were not present at the locations at which the bannering took place. 

Q: What are the crucial parameters of bannering as allowed by this decision?

A: There must be no chanting, yelling, marching, activity considered confrontational, blockage of streets or entryways, threatening activity, or ambulatory picketing.

Q: According to this decision, how is picketing different and, thus, coercive and unlawful?

A: Picketing goes beyond the simple holding of signs, but involves patrolling of picketers back and forth in front of an entrance to a business or work site, creating a physical/verbal interference/confrontation or symbolic confrontation with those entering the worksite. This conduct, according to the NLRB, is what creates the element of confrontation and allows picketing to fall within the prohibitions of Section 8(b)(4)(ii)(B) of the NLRA. This definition differentiates picketing from bannering or handing out of handbills.

Q: What are the implications of the new "Obama Board"?

A: As illustrated by this decision, it is widely believed that there will be a shift in NLRB decisions in favor of organized labor.

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