January 2nd, 2024
employment
NLRB’S REQUEST TO DROP THE ADVERSE ACTION REQUIREMENT IN SOME CASES MAY EXPAND AN EMPLOYER’S VULNERABILITY TO UNFAIR LABOR CHARGES

Most, if not all, labor and employment statutes require an employee to show some kind of adverse action on behalf of the employer to prevail, especially when seeking monetary compensation. While what constitutes an adverse action can often get murky, the Equal Employment Opportunity Commission has clarified that an “adverse employment action” includes, but is not limited to, hiring, firing, failure to promote, pay reduction and demotion.

Certain federal courts have interpreted Title VII to require the adverse action to result in a “materially adverse consequence.” See, e.g., Ortiz-Diaz v. United States Dep’t of Hous. & Urban Dev., 867 F.3d 70, 74 (D.C. Cir. 2017). This requirement often means that a lateral transfer involving no economic loss would fail to rise to the level to meet this standard, even if done with an ill intent.

In recent news, Starbucks has withheld wage raises and other new benefits from workers at unions stores. The longest tenured baristas at non-union stores are now eligible for five percent raises. Additionally, non-union stores are given a faster timeline for accruing vacation time. Starbucks is not new to such policies, as it denied raises and benefits to union stores in August of 2022, an action described by an Administrative Law Judge (“ALJ”) as a “flagrant, corporate-wide attack on its employees’ right to choose union representation.”  While there have been nearly 30 ALJ decisions that hold against Starbucks, in September of 2023, the ALJ advised of a rare administrative win for the coffee chain in its decision that Starbucks’s refusal to honor a union affiliated barista’s request for transfer was not an adverse action and thus cannot be the basis for an alleged unfair labor practice.

In an attempt to challenge the rare victory, the NLRB General Counsel, Jennifer Abruzzo (“Abruzzo”), has asked the Board to lower the threshold for anti-union discrimination in the context of Sections 8(a)(1) and 8(a)(3) of the Unfair Labor Practices. This was requested in an attempt to prevent cases where an employer does not necessarily take “adverse action” against an employee, but instead interferes with workers’ rights. An example of such would be the promotion of a worker with the intent to remove them from a bargaining unit.

Abruzzo has urged the Board to overrule the ALJ and hold that any employer action driven by anti-union animus be deemed unlawful if it reasonably chills a worker’s exercise of their rights. This action by Abruzzo may make companies who employ both union and non-union workers more vulnerable to unfair labor practice charges in the near future.

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