US AIRWAYS V. NATIONAL MEDIATION BOARD: FIRST AMENDMENT RIGHTS AND THE RIGHT OF SELF-ORGANIZATION UNDER THE RLA

US AIRWAYS V. NATIONAL MEDIATION BOARD: FIRST AMENDMENT RIGHTS AND THE RIGHT OF SELF-ORGANIZATION UNDER THE RLA By Robert A. Siegel O Melveny & Myers LLP Railway and Airline Labor Law Committee American Bar Association Mid-Winter Meeting Napa, California March 2000 8 American Bar Association http://www.bna.com/bnabooks/ababna/railway/2000/siegel.pdf

US AIRWAYS V. NATIONAL MEDIATION BOARD: FIRST AMENDMENT RIGHTS AND THE RIGHT OF SELF-ORGANIZATION UNDER THE RLA by Robert A. Siegel O Melveny & Myers LLP This article first discusses US Airways v. National Mediation Board, 1 a recent court of appeals decision involving a carrier s First Amendment rights during a union organizing drive under the Railway Labor Act (the RLA ). 2 The article then examines two arguably inconsistent carrier interference decisions, involving free speech and employee committees, which were issued by the National Mediation Board ( NMB or the Board ) shortly after the US Airways decision. I. D.C. CIRCUIT COURT OF APPEALS VOIDS NMB CERTIFICATION BASED ON FIRST AMENDMENT VIOLATION. In US Airways v. National Mediation Board, the United States Court of Appeals for the District of Columbia Circuit held that the NMB violated the First Amendment when it directed a rerun election among US Airways passenger service employees in June 1997, and certification of the Communication Workers of America ( CWA ) as the result of the rerun election was invalid. This decision marks the first time that a federal court has held that a carrier has a First Amendment right to express its views during a union organizing campaign, and the first that time a federal court has invalidated an NMB certification based on a constitutional violation. The decision also rejects the peek at the merits standard for evaluating constitutional issues and should provide a potent weapon for carriers to challenge the NMB s current approach in carrier interference cases. The NMB s Decision. The court of appeals decision arose out of US Airways, Inc., 3 in which the NMB held that US Airways had interfered with employee free choice during a 1996 election in which the CWA sought to represent US Airways passenger service employees. After CWA had failed to obtain majority support in the 1996 election, it filed a carrier interference charge with the NMB in which CWA alleged that US Airways had improperly expanded the number and scope of its employee roundtable committees during CWA s organizing drive, and that it had improperly told employees that these committees were a preferable alternative to collective bargaining and that selection of a collective bargaining representative would result in their elimination. In its decision, the NMB, in order to guide carriers in future representation campaigns, identified five categories of carrier conduct with regard to employee committees that, it said, 1 177 F.3d 985 (D.C. Cir. 1999). 2 45 U.S.C. 151 et seq. 3 24 N.M.B. 354 (1997). 1

interfered with employee free choice. The first three guidelines prohibited a carrier from establishing new employee committees during a union organizing drive, changing the scope of its existing committees, or modifying the terms and conditions of employment through its committees. The last two guidelines, however, directly proscribed carrier speech by prohibiting carrier campaigns which indicate that a pre-existing committee is, or should be a substitute for a collective bargaining representative, or which asserted that election of a collective bargaining representative would result in the elimination of an employee committee. The NMB held that US Airways had violated each of the five initial guidelines during the 1996 election. As a remedy, it directed a rerun election with its standard ballot and mailed a notice to all eligible employees stating that US Airways had interfered with employee free choice during the first election. US Airways Seeks TRO. Immediately following issuance of the NMB decision, US Airways filed a lawsuit in the United States District Court for the District of Columbia seeking a temporary restraining order against implementation of the Board s decision on the ground that the Board s decision punished US Airways protected speech during the first election and proscribed protected speech during the rerun election, and on the alternative ground that the Board s remedies exceeded its authority under Section 2, Ninth of the RLA. 4 The district court declined to issue a TRO, but held that if the court s order were subsequently held to exceed its jurisdiction or violate the Constitution it would invalidate any certification arising from the rerun campaign. In the rerun election a majority of employees voted in favor of representation by CWA, and the Board therefore certified CWA as the representative of US Airways passenger service employees. Following certification, the district court dismissed US Airways lawsuit on the ground that a peek at the merits did not reveal a gross violation of the Railway Labor Act or an infringement of US Airways constitutional rights. On appeal, US Airways raised only the First Amendment issue, arguing that the federal courts had jurisdiction over alleged violations of a carrier s constitutional rights, and that under NLRB v. Gissel Packing Co., 5 an employer had an unfettered constitutional right during a union election campaign to express its opinion regarding unionization, and to make predictions, based on objective fact, as to the effect that selecting a union would have on the employees involved and that the Board s campaign guidelines, on their face, prohibited such speech. In a decision issued on May 28, 1999, Judges Silberman, Williams and Tatel of the D.C. Circuit upheld US Airways arguments, reversing the district court on both grounds, and directed the district court to invalidate the certification of CWA arising from the rerun election because US Airways had been unconstitutionally prohibited from expressing its views from the rerun election. The Appellate Court s Analysis. The court of appeals began its analysis by concluding that the federal courts have authority to consider a claim that the NMB violated a carrier s constitutional rights on the full merits, 4 45 U.S.C. 151 et seq. 5 395 U.S. 575, 617 (1969). 2

rejecting the NMB s argument that the courts could take only a peek at the merits to decide a constitutional issue. Although the D.C. Circuit had first promulgated the peek at the merits standard for reviewing claims that the NMB had violated the RLA, and had, in dicta, applied the standard to constitutional claims in prior decisions, the court concluded that the peek at the merits standard had been applied to constitutional issues and count not sensibly be applied to such arguments. Rather, the court held, all constitution claims had to be addressed on their full merits, without any restriction on the court s jurisdiction to do so. Turning to the merits of US Airways argument that the NMB decision unconstitutionally restricted free speech, the court rejected the NMB s argument that the Gissel decision did not apply to the RLA, and that carriers under the RLA had a lesser right of free speech under the First Amendment than employers subject to the RLA. While the NLRA contains a specific provision protecting an employer s right to express any views, argument, or opinion during an organizational campaign, 29 U.S.C. 158(c), the Gissel court had concluded that the provision merely implemented the First Amendment, and the D.C. Circuit found no basis for not affording RLA employers a similar right. Carrier s Speech Protected. Finally, the court held that the two categories of speech proscribe exactly what the Gissel court protects. 177 F.3d at 992. The first restriction, the court noted, prohibited a pure expression of the carrier s opinion that the use of employee committees was preferable to collective bargaining, while the second was a reasonably phrased prediction based on objective criteria -- the labor laws. Echoing a prior decision by Judge Williams, the court noted that if unions are free to use the rhetoric of Mark Anthony while employers are limited to that of a Federal Reserve Board chairman,... the employer s speech is not free in any practical sense. 6 In reaching the conclusion that the NMB decision violated US Airways First Amendment rights, the court held that it did not have to reach the issue of whether the Board s decision to conduct a rerun election violated the First Amendment because the NMB decision clearly restricted US Airways from exercising its First Amendment rights during the rerun election, and that the certification issued by the NMB therefore could not stand. If it had to consider the former issue, the court noted, it would have evaluated the NMB decision under the standards set forth in the U.S. Supreme Court s decision in NLRB v Virginia Electric & Power Co. 7 That decision allows the NLRB to consider an employer s speech insofar as the speech merges into a course of unlawful conduct, but does not allow the NLRB to base an unfair labor practice ruling principally on the employer s speech. Effect of Court s Decision. The court of appeals decision promises to have a dramatic effect on the Board s consideration of carrier interference cases, and carriers ability to challenge such decisions in 6 177 F.3d at 993. 7 314 U.S. 469 (1941). 3

federal court. Although the Board is not likely to invoke the specific restrictions at issue in US Airways, during the last decade the Board has issued a number of decisions in which it has directed rerun elections based solely or predominately on carrier speech. For example, in several cases it has premised carrier interference findings on little more than criticisms of the union, 8 or a sustained anti-union posture. 9 The Board has also issued a number of decisions in which it has based carrier interference findings not on the content of carrier communications but on the number of communications. 10 The rationale of these decisions -- that the Congress intended carriers to have a lesser role in organizing campaign under the RLA than under the RLA, and even [an] otherwise protected speech may be prohibited when in the Board s judgment it interferes with employee free choice -- does not withstand analysis under the D.C. Circuit s decision. Thus, if the NMB continues to consider carrier speech in future carrier interference decisions, carriers should be able to challenge those decisions on First Amendment grounds. Perhaps even more significantly, the US Airways decision provides carriers a straightforward basis to challenge the Board s carrier interference rulings insofar as those ruling arguably violate the carrier s constitutional rights. Historically, it has been extremely difficult for carriers to challenge such decisions because the Board has successfully invoked the doctrine that its decisions are not reviewable by the federal courts except in extraordinarily narrow circumstances -- a standard that, in practice, has been virtually impossible to meet. Although the courts have always recognized an exception to this rule for issues of constitutional dimension, no court has ever previously invoked that standard to invalidate a certification. Under US Airways v. NMB, however, the district courts clearly have jurisdiction to evaluate whether the Board s decision was improperly based upon protected communications by the carrier. Because the decision is binding upon all district judges within the District of Columbia, and because the NMB can always be sued within the district, the Board will have difficulty avoiding the direct effect of the court of appeals decision. In should also be emphasized that the court of appeals decision is not limited to First Amendment arguments. In prior cases, several carriers have pursued arguments -- that the Board s decisions violated due process or some other constitutional rights. Under the US Airways decision, the federal courts now clearly have jurisdiction to consider those claims. Moreover, the D.C. Circuit, in the course of its analysis, opened what could be even a larger breach in the NMB s heretofore impenetrable defenses. In the course of its analysis, the court specifically held that the rule of non-reviewability of NMB determinations under Switchmen s Union v. NMB 11, applied only where the RLA had been judicially interpreted to preclude review prior to the enactment of the Administrative Procedures Act, 5 U.S.C. 701 et seq. The practical effect of this ruling should limit Switchmen s Union to the specific question at issue there -- the Board s factual determination as to who are the representatives of such employees under Section 2, Ninth of the RLA. Because the Board s carrier interference jurisdiction was not at issue in Switchmen s Union, and no court has ever ruled that the NMB had authority to engage in 8 17 N.M.B. 79, 100 (1990). 9 US Air 17 N.M.B. 377, 427 (1990). 10 E.g., Federal Express Corp. 11 320 U.S. 297. 4

that process, the Board s entire carrier interference practice may be subject to judicial review under the US Airways decision. II. SUBSEQUENT TO US AIRWAYS, INC. V. NMB, NMB REACHES DIFFERING CONCLUSIONS IN TWO CARRIER INTERFERENCE CASES INVOLVING EMPLOYEE COMMITTEES. Subsequent to the court of appeals decision in US Airways Inc. v. NMB, the NMB issued two decisions last summer highlighting the difficulties that carriers have in predicting the outcome of NMB carrier interference claims. The decisions involved allegations by the Communication Workers of America ( CWA ) that a carrier had interfered with its attempts to organize passenger service employees through the use of employee committees. In US Airways, Inc., 12 the NMB ordered a rerun election where the carrier established a new system wide employee committee, and made minor technical changes to its attendance and swaps policies through its existing employee committees, several months prior to the NMBconducted election. A few weeks later, in American Airlines, Inc, 13 the NMB refused to order a rerun election where the carrier established a seemingly similar system wide employee committee, expanded travel benefits and implemented a previously planned pay increase. A. The NMB s US Airways Decision The NMB s US Airways decision arose directly out of the court case discussed above, US Airways, Inc. v. NMB, 14 in which the D.C. Circuit held that the NMB violated the First Amendment by restricting US Airways speech during a 1997 rerun election, and invalidated the union s certification issued as a result of the 1997 election. Following the court of appeals decision, CWA asked the NMB to conduct an expedited rerun election. US Airways, in turn, argued to the NMB that it should first determine, following full briefing by the parties, whether any rerun election was appropriate in light of the court of appeals ruling that the speech upon which the Board had based its earlier order was constitutionally protected. US Airways also argued that even if another rerun election were appropriate, the NMB should allow sufficient time for the taint of its unconstitutional certification to fade before holding such an election. In a decision issued on June 25, 1999, the NMB decided the merits of US Airways contentions without further briefing, and ordered an expedited rerun election based solely on changes made in working conditions during the critical period in which the Board has repeatedly stated that laboratory conditions must be maintained, 15 without consideration of US Airways speech during that election. The Board stated: [T]he carrier formed a new committee, the System Roundtable, and expanded the 12 26 N.M.B. 323 (1999). 13 26 N.M.B. 412 (1999). 14 177 F.2d 985 (D.C. Cir. 1999). 15 26 N.M.B. at 327. 5

scope of existing committees after the Carrier knew of CWA s organizational activity. The restructured employee committees were used to make improvements in certain significant working conditions, such as the swap and attendance policies. Three adjustments to the swap policy, involving the issues of notice and trades, were made in July 1996, three months after CWA s application was filed. A month later the attendance policy was revised. Also, during the critical period, new task forces were created to study other changes in employee policies. In addition, a change in the scope of a task force recommendation was made as the result of the PDO (paid days off) Task Force. As previously found by the Board, the investigating mediator s interview of employees who were a part of the roundtable process and who had participated in the pre-existing roundtables, it is evident that changes and improvements to working conditions, made during the critical period, improperly interfered with the freedom of choice of the employees participating in the election. 16 Board Fails to Explain Inconsistencies In reaching this conclusion, the NMB failed to explain several inconsistencies between this conclusion and its 1997 decision in US Airways, Inc. 17 First, the 1997 decision by its express terms relied heavily upon US Airways campaign speech as part of the totality of circumstances that lead the Board to conclude that the laboratory conditions required for a fair election were tainted. Fully half of the NMB s 39-page decision was devoted to a discussion of the carrier s speech, and the decision concludes that, [i]n summary, the Board finds that the overall effect of the carrier s campaign was sufficient to overwhelm the employees ability to choose a representative freely. 18 The Board s assertion some two years later that it would have reached exactly the same result without consideration of the carrier s campaign speech should have merited more than the one sentence explanation that the Board gave it. Second, in its earlier decision the NMB had addressed US Airways reliance on Continental Airlines, 19 in which the Board found no interference despite the carrier s implementation of substantially more significant wage and benefit increases, by stating that the distinguishing factor between the instant case and Continental, supra, is that in the earlier case the carrier did not focus on the employee committees in its campaign. 20 In light of this statement, logic would dictate that if the NMB did not consider US Airways speech focus[ing] on the employee committees in its campaign, the NMB would have found no basis for a rerun election. The NMB s decision, however, fails to address this point, leaving carriers to speculate on what factors, if any, distinguished the two cases. Third, the factual basis cited by the Board for its finding that US Airways conduct alone was sufficient to interfere with laboratory conditions that is, the interviews conducted by the 16 26 N.M.B. at 327-28. 17 24 N.M.B. 354 (1997). 18 24 N.M.B. at 391. 19 21 N.M.B. 229 (1994). 20 24 N.M.B. at 391. 6

Board s mediator with US Airways employees during 1997 appears to be inconsistent with the Board s description of those interviews in its 1997 decision. The implication of the Board s reference to the employee interviews is that the conduct cited by the Board (three changes in employment policy made or considered by US Airways employee committees) caused the employees to believe that they would be better off without a union. However, in its 1997 decision, which is the only available factual description of the employee interviews because they were conducted by the Board s representatives in confidence, the Board described the interviews as follows: Despite the fact that employees were told not changes could be made until the representation dispute was concluded, a reasonable person would perceive that his or her benefits were enhanced, and would continue to be enhanced through the roundtable process. This finding was verified by the testimony of the employees interviewed by the mediator who are a part of the roundtable process and who have participated in the preexisting roundtables. Although the employee witnesses attribute the changes and improvements to the new management, it is clear that these changes have had an influential effect on the employees during the election period. 21 If the employees attributed the changes and improvements to new management and not to the CWA organizing drive, it is difficult to understand the basis for the Board s conclusion that those changes tainted laboratory conditions. B. The NMB s American Airlines Decision The American Airlines decision was issued on August 11, 1999 some six weeks after the US Airways decision, although the American case had been fully briefed several months earlier. In American, CWA launched a broad attack on American s conduct during an unsuccessful effort by CWA to organize American s passenger service employees during 1997, including (1) barraging employees with anti-union propaganda, (2) interrogating and engaging in surveillance of known union supporters; (3) discriminatorily enforcing a no-solicitation rules; (4) refusing to discipline a supervisor who allegedly assaulted an union supporter; (5) establishing new employee committees; and (6) granting pay increases during the status quo period. Many of the union s allegations were dismissed by the Board for lack of evidentiary support, and therefore do not shed much light on how the NMB might deal with similar allegations in future cases. As a result, the most important aspects of the decision are the NMB s discussion of the First Amendment issues, and its analysis of American s wage increases and employee committees. NMB s First Amendment Analysis Remarkably, in discussing a carrier s right to communicate with its employees, the NMB in American makes no mention of the court of appeals decision in US Airways v. NMB. Instead, the NMB invoked the same First Amendment analysis that it had reiterated in earlier decision, 21 24 N.M.B. at 389. 7

including the 1996 US Airways decision that the Court of Appeals held to be unconstitutional. In American, the NMB begins by stating the general principle that [c]arriers have a right to communicate their views during election campaigns. 22 The Board immediately adds the caveat, however, that such right is not without limits, and even conduct with its otherwise lawful may justify remedial actions when it interferes with a representation election. 23 Moving to the facts of the case before it, the NMB held that a review of the record establishes that American did not attempt to overwhelm employee free choice with an overabundance of written campaign materials. The flaw in the NMB s reasoning, of course, is that under the First Amendment analysis adopted by the Court of Appeals, the volume of communications could never make otherwise protected speech unprotected. By holding that American did not employ an overabundance of campaign materials, the NMB clearly implies that it may, in a future decision, find interference based on the number of carrier communications. NMB Disclaims Restrictions on Pure Speech Although the NMB did not expressly refer to the US Airways litigation, in closing its First Amendment analysis the NMB makes an unmistakable, if enigmatic, reference to the case: In this case, as with all cases, the Board s evaluation of allegations regarding campaign communications does not focus on pure speech, but on whether the speech in the context of the totality of the circumstances impermissibly interferes with employee free choice. 24 While this reference clearly anticipates, and attempts to avoid, any argument that the Board has restricted constitutionally protected speech, it does not do the job. If adding the phrase totality of the circumstances to the end of an NMB decision immunized the Board against a First Amendment challenge, the constitutional protection would be meaningless. While it is obvious that speech may merge into a course of coercive conduct, and that the First Amendment does not bar the NMB from remedying the conduct, the NMB s refusal to acknowledge that speech, as such, is constitutionally protected unless it amounts to a promise of benefit or threat of retaliation, indicates that the Board may continue to face First Amendment litigation. NMB s Discussion of Employee Committees Another noteworthy aspect of the American decision is its treatment of CWA s allegations that American improperly modified its employees committees, which the NMB analyzed the issue solely as a matter of timing. Because the Board concluded that American was, or should have been, aware of CWA s organizational campaign its late October 1997, but announced the planned changes to its employee committee structure in early October 1997, the changes did not interfere with laboratory conditions, the Board held, even though they were implemented later. 22 26 N.M.B. at 447. 23 26 N.N.B. at 447 (quoting America West Airlines, 17 N.M.B. 226 (1990). 24 26 N.M.B. at 448. 8

The effect of the Board s analysis is to place extraordinary importance on when the carrier becomes aware of the union s organizing campaign. In prior cases, while the Board consistently stated that the laboratory conditions period began when the carrier became aware of the organizing effort, in applying that rule the Board appeared to draw a distinction between events that occurred early during the card collection process, events that occurred after the union had filed its representation application, and events that occurred at the time the Board was mailing ballots giving the carrier much more latitude to make changes in employment conditions early in the process. 25 The Possibility of Perpetual Organizing This bright line test imposes an extraordinary burden on carriers. As the first CWA campaign at US Airways demonstrated, an organizing campaign can last a year or more, and the NMB can take six to ninth months to resolve eligibility issues and conduct an election among a large employee group, thus freezing employment conditions for up to two years. Moreover, the union is free to announce a new organizing campaign immediately after the first election effectively imposing a perpetual obligation. Although the Board held in Petroleum Helicopters, Inc., 26 that the carrier may make changes required by clear and convincing evidence of a compelling business justification, there is no way for a carrier to predict with certainty when the NMB will find its business justifications sufficiently compelling. The NMB s test also raises questions about the NMB s authority to regulate preapplication conduct. It is well established that the NMB has no authority to enforce the employee rights created by Section 2, Fourth of the RLA, and thus no general authority to regulate a carrier s conduct. Rather, its only authority arises from its obligation under Section 2, Ninth to investigate representation disputes. The D.C. Circuit, however, held in Railway Labor Executives Ass n v. NMB, 27 that the NMB has authority to act under Section 2, Ninth only where the carrier s employees have triggered the NMB s authority by filing a representation application. If the NMB has authority under Section 2, Ninth only after the carrier s employees have invoked its jurisdiction, there is a question as to whether the NMB has any authority to regulate preapplication conduct. NMB s Treatment of Pay Increases The final aspect of the American decision worth discussion is the NMB s treatment of allegations that American had improperly made modified employee policies during the CWA s 25 E.g., Federal Express Corp., 20 N.M.B. 7, 48 (1992) ( the Board is disturbed by the timing of the formation of the committee, in the middle of the election period ); Metroflight, 18 N.M.B. 532, 552 (1991) ( many of the action in the present case tainted the laboratory conditions necessary for a fair election because they occurred during a time when they would have the most impact, during the election period, November and December of 1990 ). 26 25 N.M.B. 197 (1998). 27 29 F.3d 655 (D.C. Cir. 1994), cert. denied 115 S.Ct. 1392 (1995). 9

organizing campaign. In both the 1997 and 1999 US Airways cases, the NMB appeared to apply a per se rule that a carrier could not modify employment policies during an organizational campaign, asserting that "the continuation of existing benefits is a prerequisite of a fair election. 28 In American, however, the NMB showed considerably more flexibility, holding that granting or withholding pay or benefit increases was permitted if the changes were pre-planned, or if there were compelling business justifications for the carrier s conduct under the Petroleum Helicopters standard. 29 The NMB also appeared to alter its approach to obtaining employee input on potential policy changes even if no changes were implemented. In US Airways, the NMB specifically cited as evidence of the carrier s interference the creation of several employee task forces to discuss potential changes to the carrier s policy. In American, on the other hand, the NMB rejected CWA s argument that the carrier had improperly used its employee committees in a similar manner, holding that the employee committees were not used to change the open relief bidding process, but only to assess employee opinion. 30 The NMB does not explain why assessing employee opinion was permissible in American but constituted interference in US Airways. C. Summary In summary, although the NMB expressly disclaimed that its US Airways decision was based on the carrier s speech, the factual similarities between the US Airways and American cases, and the dramatic difference in results, raises the question of whether the NMB was truly ignoring the carrier s speech in assessing the permissibility of its conduct. III. CONCLUSION The discussion above demonstrates that the law with respect to First Amendment rights during organizing campaigns under the RLA is evolving. The D.C. Circuit s opinion in US Airways v. National Mediation Board is a significant development which calls into question a number of NMB precedents. Depending on how the NMB reacts to this development, it is possible that there will continue to be litigation over these issues. 28 24 N.M.B. at 386. 29 26 N.M.B. at 454. 30 26 N.M.B. at 454. 10