NLRB Overturns 40 Year-Old Precedent Regarding What Employers May Permissibly Say to Employees During Union Campaigns Regarding the Effects of Potential Unionization
Kathryn Bennett, Law Clerk
On November 8, 2024, the National Labor Relations Board (the “Board”) ruled in Siren Retail Corp. d/b/a Starbucks Corp. that the prior test governing the lawfulness of statements made by employers concerning the effects of unionization on the employer/employee relationship was wrongly decided, and defined a new test that considers whether the employer’s statements are factually supported and reasonably justified. This pro-labor decision is one of the last that may be issued by the Board under its current Democratic majority, prior to the inauguration of President-elect Trump and the personnel changes expected to accompany his return.
Overruling Tri-Cast, Inc.
In Siren Retail Corp. d/b/a Starbucks Corp.,[1] the Board issued a decision to overrule Tri-Cast, Inc.[2], a nearly forty-year-old decision that provided the test for determining the permissibility of employer statements related to the potential impacts unionization may have on the relationship between workers and management. Under Tri-Cast, employer communications setting forth the employer’s opinions about how unionization might impact the labor-management dynamic (such as, for example, statements about how unionization might create impediments to direct communications between employees and employers to resolve work-related issues) were not considered either implicit or explicit threats under the NLRA. Consequently, since Tri-Cast, most employer statements related to the possible effects of unionization on the labor-management dynamic have been considered lawful.
In the Siren decision, the Board agreed with administrative law judge that Starbucks managers’ statements to employees that they would not be able to directly communicate with management after unionization did not violate Section 8(a)(1) of the Act according to Tri-Cast, but nonetheless took the opportunity to revisit and overrule the Tri-Cast decision. Tri-Cast, the Board explained, erred in offering categorical protection for statements concerning an employee’s ability to address issues directly with the employer. Under certain circumstances, such statements could be construed as threats by a reasonable employee, the Board explained, and therefore must be assessed on a case-by-case basis.
The Now-Current, Heightened Standard for Employer Statements On Unionization
By overruling Tri-Cast, the Board reverted to a pre-Tri-Cast standard which provides that while employers may make statements and predictions about the potential negative effects of unionization, any such predictive statements must be grounded in some factual basis and “convey an employer’s belief as to demonstrably probable consequences beyond his control” in order to be lawful.[3] Thus, if an employer’s predictive statements are not based on objective fact, or if they predict consequences that would result from the employer’s own actions, then such statements may constitute threats of retaliation per the Board. For example, a statement to the effect that unionization would require collective bargaining, and that the employer cannot predict what changes will occur (either good or bad) as a result of collective bargaining, would likely be lawful even under the revised standard, whereas a statement to the effect of “we think things will only get worse if the union is elected” would likely be unlawful.
Employer Considerations About Future NLRB Actions
The Siren decision comes at the end of Lauren McFerran’s term as chairperson to the Board, which has held a Democratic majority throughout McFerran’s tenure. Each of the five Board Member positions are filled by Executive appointment and confirmed in the Senate. Currently, McFerran’s nomination to a third term is pending Senate approval. If the Senate confirms her for another term, the five-member Board will retain a Democratic majority until the next opportunity for change arises when Republican Board Member David Prouty’s term expires in August 2026.
Regardless of McFerran’s confirmation, President-elect Donald Trump is expected to replace the NLRB’s general counsel as early as Inauguration Day, meaning an immediate and seismic shift in the NLRB’s objectives is likely soon to come. Under Jennifer Abruzzo, (a Biden appointee), the NLRB through its regional offices sought injunctive relief more frequently; refused to settle plaintiffs’ claims for less than full or expansive remedies; and helped make it easier for workers to unionize without an election. Trump’s choice of replacement is likely to discontinue many of these pro-labor policies and reorient the agency toward employer interests.
Campbell Litigation remains available to answer your questions concerning these and other legal changes affecting labor and employment
[1] Siren Retail Corp. d/b/a Starbucks Corp., No. 19—CA—290905, (Nov. 8, 2024).
[2] Tri-Cast, Inc., 274 NLRB 377 (1985).
[3] NLRB v. Gissel Packing Co., 395 U.S. 575, 618 (1969).