The National Labor Relations Board has issued an order accepting as “the law of the case” a 2009 decision by the 2d U.S. Circuit Court of Appeals in which, drawing a distinction between picketing and striking, that Court held that a New York health clinic unlawfully fired five employees for joining a picket line, even though the picketing itself was an unfair labor practice by the union. Correctional Medical Services, Inc, 356 N.L.R.B. No. 48, December 9, 2010.

Correctional Medical Services (“CMS”) operated a health clinic at a state correctional facility in Albany, NY. In September 2002, five off-duty employees of CMS joined a peaceful union picket line of about 20 individuals that was protesting CMS’ refusal to recognize AFSCME Local 1000 (“the union”) as bargaining agent for all of the clinical workers of CMS. The picketing was peaceful, and lasted for less than an hour, without blocking access to the clinic. CMS issued letters to the five off-duty employees, informing them that the union’s conduct was “illegal” and, therefore, that the five employees would be informed of their employment status after an investigation.

Section 8(g) of the National Labor Relations Act (NLRA) includes a provision that requires a labor organization to provide at least 10 days advance notice before engaging in “any strike, picketing, or other concerted refusal to work” at a healthcare entity. In this case, no such notice was given, and the five CMS employees ultimately were terminated from their employment. CMS also filed a charge against the union under Section 8(g). The union settled the Section 8(g) charge, but filed its own charge, alleging that the termination of the five off-duty employees violated the National Labor Relations Act (“NLRA”).

In 2007, the NLRB said that the employees had acted in violation of the NLRA, and that the termination were appropriate. The union filed a petition, asking the Second Circuit to review the NLRB order, and that petition was granted. On appeal, the Second Circuit ruled that the NLRB improperly construed Section 8 of the NLRA related to healthcare workers.

Under Section 8(a) of the NLRA, an employer commits an unfair labor practice if it interferes with an employee’s right to organize. Picketing is generally considered to be a protected activity under the Act. However, in the 1974 amendments to the NLRA, Congress modified Section 8 of the Act, adding a restriction – Section 8(g), mentioned above – related to picketing or striking against a healthcare entity, and requiring a 10-day notice of such activity by “labor organizations.” That particular sub-section does not state that an individual employee who participates in such activity commits a violation. Under modified Section 8(d), however, an employee who engages in “any strike” at the healthcare entity without the required notice is no longer an “employee” under the NLRA, losing all protection under the Act. This was the language cited by CMS to support its discharge of the five picketers.

However, the Second Circuit pointed out that while Section 8(d) provides that an employee who engages in a strike without proper notice “shall lose his status as an employee of the employer engaged in the particular labor dispute,” Section 8(d) does not include a comparable provision about employees who participate in peaceful picketing conducted by the union in violation of those notice requirements. Therefore, while a “labor organization” is subject to sanctions for either striking or picketing without observing the appropriate notice under Section 8, the Act specifically sanctions only those individuals who participate in a strike against a healthcare entity, and not in picketing of that same employer (unless those individuals are actually “agents” of the union under a separate Section of the NLRA). The Second Circuit then vacated the NLRB’s decision, and remanded the case back to the NLRB for review.

On remand, the Board accepted the Second Circuit’s 2009 decision, and found that CMS violated the NLRA by interfering with the employees’ rights to act collectively. It further found that CMS violated the NLRA by threatening the employees with disciplinary action before the investigation that led to their discharge, and by interrogating the employees about the picketing. Under the Act, CMS’s questioning of the employees was viewed by the Board as “coercive.” Importantly, the test for coercion under the applicable section of the NLRA “does not turn on the employer’s motive.” In other words, an employer’s good-faith belief that its actions are not coercive is not a defense.

This importance of this case to healthcare entities is obvious, in light of current efforts toward unionization of healthcare employees. While the Board’s decision does not bring up this fact, the Second Circuit specifically pointed out in its 2009 opinion that this circumstance involved only “peaceful picketing by off-duty employees that caused no disruption to the operation of the clinic,” but states that it could “conceive of certain circumstances where protected picketing could cause disruption in the ability of a health care facility to deliver health care.” Interestingly, this language is not referenced in the Board’s recent opinion and, therefore, it may be safe to assume that the Board may not be as flexible as the Court in holding differently if the picketing at issue is more disruptive than in this instance.