Tuesday, September 27, 2016

Work Stoppage in the 21st Century

What do the NFL, the cereal brand Kellogg’s, and Long Island University Brooklyn Campus (LIU-Brooklyn) have in common? They all have dealt with employee lockouts in the last five years. Given the September 14th end to the LIU-Brooklyn faculty lockout, in this issue of Astronology® we discuss lockouts and work stoppage in general.

Strike vs. Lockout…what’s the difference?
Both lockouts and strikes are forms of work stoppage. However, the ways they develop are different. Strikes occur when employees decide as a group to stop working during a labor dispute. In some cases, striking can be illegal. For instance, certain labor contracts, as well as certain public service employees, are not allowed to strike. An exception to this rule could be if the job has hazardous work conditions. Oftentimes, the National Labor Relations Board (NLRB) determines whether a strike is lawful.

Strikers fall under two categories. The objectives of “economic strikers” are better wages, hours, and/or working conditions. The objectives of “unfair labor practice strikers” involve rectifying unfair labor practice(s) allegedly committed by the employer.

Lockouts occur when management decides that employees should stop working during a labor dispute. In some instances, employers will hire replacement workers, even though locked out employees are entitled to their jobs after the lockout ends. The NLRB lists a number of things employers can do with respect to lockouts and strikes, including the following:
  • Lock out employees defensively – provided it is not to interfere with or defeat union activity.
  • Lock out employees defensively – in response to a “whipsaw” strike.
  • Lock out employees offensively – if the sole purpose is to “bring economic pressure to bear in support of a legitimate bargaining position.”
  • Hire temporary replacements to continue operations during a strike or lawful lockout.
  • Hire permanent replacements to continue operations during an economic strike.
How often do work stoppages occur? According to the Bureau of Labor Statistics (BLS), there were only 12 major strikes and lockouts in 2015. These stoppages idled 47,000 workers. The lowest annual report was a total of five major strikes and lockouts back in 2009.

Lockouts in the Education Field

In the case of LIU-Brooklyn, the faculty lockout was an unprecedented move in the higher education field. SHRM mentioned in an online article that these lockouts rarely occur for a number of reasons. For instance, it is speculated that the current NLRB is more prone than prior boards to rule against employers. Publicized lockouts also can give the employer a negative label in the eyes of the public. In the case of the higher education sector, where the needs of the student are directly linked to the quality of the staff, if the staff isn’t happy, students aren’t either. For the business and advertising aspects of higher education, this is bad publicity, and bad for business.

LIU-Brooklyn initiated its faculty lockout in order to avoid a strike, since previous negotiations have resulted in strike votes. The faculty lockout, which started September 2nd, lasted until September 14, 2016. The solution reached? LIU administration extended the faculty members’ previous contracts until May 2017, and will reimburse healthcare costs incurred during the time period of the lockout for the affected 400 professors.

What of the other companies mentioned in the beginning of this article? Back in May 2015, Kellogg’s was found guilty of unlawfully locking out 200 employees for nine months at its Memphis, Tennessee cereal plant. Kellogg’s had to bargain with the union, offer to reinstate any locked out workers who had not returned to work, and give back pay and benefits lost during the lockout. For the NFL, in 2011 the 18 week, four day lockout ended with NFL owners approving a 10 year bargaining collective agreement that was later ratified by NFL players.

Has your organization ever faced a form of work stoppage? How was it handled? Share your thoughts with Astronology® and we may feature your response in a future article!

Tuesday, September 13, 2016

Requiring Noncompetes:Are You Overdoing It?

By guest author: pmphrblog for Portnoy, Messinger, Pearl & Associates, Inc. Tri-State area human resources and labor relations consulting firm.

Does your business require all new hires to sign a noncompete agreement? Are those agreements enforceable? The practice of requiring all employees -- including low-level staff -- to sign noncompetes has come under fire recently, with federal and state both targeting the issue.

The New York Attorney General’s office recently settled cases it had brought against Law 360, a legal news service, and the sandwich chain Jimmy John’s. Both Law 360 and Jimmy John’s Sandwiches have had a practice of requiring low-level employees to sign noncompetes. At Law 360, these employees included journalists fresh out of college; at Jimmy Johns they included sandwich makers. The Attorney General has stated, “Unless an individual has highly unique skills or access to trade secrets, non-compete clauses have no place in a worker’s employment contract.”

Furthermore, in May the White House issued a report on the use of noncompetes. The report asserts that noncompetes can depress wages and reduce workers’ mobility. The report also notes that employees are often asked to sign a noncompete only after they have already accepted the job and declined other offers, at which point they have little leverage. Further, the report expressed concern over the increasing number of lawsuits brought by employers to enforce noncompetes in recent years.

Notwithstanding these concerns, there are circumstances where noncompetes are indeed necessary for protecting an employer’s proprietary assets. In New York and many other states, noncompetes are enforceable, if reasonable in time and geographic scope, where necessary to prevent disclosure of trade secrets or confidential customer information, or where the employee’s services are deemed special or unique.

Accordingly, when considering requiring an employee to sign a noncompete, employers should ask themselves: If this employee were to leave and joins a competitor, in what ways might our business be harmed? Are we concerned she would use our proprietary information for the benefit of the competitor? Or is our primary concern that she might take our clients with her, or recruit our other employees to join her? Or is it simply that we don’t want to lose her as an employee, period?

If the employee will have no real access to trade secrets, business strategies, plans, or similar proprietary information, then there is probably no need for a noncompete. If the main concern is that he/she will poach clients or other employees, this can be addressed more efficiently with a nonsolicitation agreement. If the employer is simply using noncompetes as a retention device---i.e., trying to discourage employees from leaving by limiting their ability to find new jobs---it would be well-advised to consider other, more effective methods of employee retention.

There is no doubt that noncompetes have a place in the business world. But they should be used thoughtfully, and when actually needed. Requiring everyone from the CEO to the mail room clerk to sign a noncompete is neither necessary nor a good business practice. For guidance on the use of noncompetes, please contract an HR professional at Portnoy, Messinger & Pearl.

This article is intended for general information only and should not be construed as legal advice.

For more information on labor relations please visit us at: 

http://www.pmphr.com/ or email: info@pmpHR.com.

About Portnoy, Messinger, Pearl and Associates:
Portnoy, Messinger, Pearl and Associates, Inc. (PMP), the oldest labor relations consulting firm representing management on Long Island, was founded in 1964 by former union organizer and worker’s rights advocate, Murray W. Portnoy. Initially, Murray offered human resource consulting and union contract negotiating services to a handful of clients. Today PMP has a full staff of experienced and talented human resources and labor relations consultants, labor and employment attorneys, and administrative personnel. Murray Portnoy’s values and vision remain at the core of PMP’s mission and principles.

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