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INSIGHT: Attempts to Weaponize Ethics Procedures at NLRB—An Apology Is Owed

Jan. 2, 2020, 9:00 AM

Recently the National Labor Relations Board (Board or NLRB) issued its ethics recusal report. The report under NLRB Chairman John Ring’s leadership is an excellent and comprehensive review of ethics and recusal policies utilized by various government entities.

The report also provides a detailed analysis of how the NLRB has historically responded to recusal requests and provides a blueprint for the Board to follow with respect to recusal motions and alleged conflict of interest issues.

Additionally, the report analyzes the decisional process that the Board utilized in 2018 in deciding the controversial Hy-Brand Industrial Contractors Ltd. cases—cases that involved important joint employer issues under the National Labor Relations Act (NLRA), including how the process that was utilized was deeply flawed.

Origin of 2018 Joint Employer Weaponization Efforts

Alleging ethics violations by government officials can be a potentially powerful way to generate media and public attention and a strategy to attempt to prevent government officials to take a particular course of action. Alleging ethics violations also can be utilized in an extremely harmful and misleading way.

A prime example of such improper “weaponization” of ethics procedures was utilized last year by organized labor and their allies on Capitol Hill and directed at the NLRB. The objective of such strategy was to influence the adjudication of cases before the Board regarding the scope of employer liability under the NLRA’s joint employer doctrine.

During the Obama administration, the Democrat majority on the Board successfully overturned years of Board precedent, including issuing an important decision in the Browning-Ferris case that considerably expanded the scope of employer liability under the Board’s joint employer doctrine—one of the most potent doctrines in our nation’s jurisprudence, which holds non-acting parties potentially liable for the acts and omission of others.

After the 2016 presidential election, the Republicans eventually gained a 3-to-2 majority status on the NLRB. Organized labor and their congressional allies realized that such Republican majority status put at risk the precedent reversals obtained during the Obama administration and immediately initiated attacks on the new Republican Board majority to attempt to prevent the Board from issuing major policy decisions.

A central tenet of this strategy was an attempt to have at least one of the new Republican Board members recused from voting on key policy cases, which, if it had succeeded, would have resulted in a 2-to-2 philosophical deadlock at the Board. Central to that strategy was an attempt to weaponize ethics procedures at the Board.

The “thinking” behind such strategy was an attempt to have Ring and Emanuel recused from certain cases, including particularly cases involving the joint employer doctrine under the NLRA.

One of the first post Browning-Ferris joint employer cases to reach the Board was Hy-Brand (Hy-Brand I). In that case, Emanuel sought guidance from the Board’s designated agency ethics official (DAEO) as to whether he should participate in the case. The DAEO cleared him to vote in the Hy-Brand case without reservations.

Thereafter, on a 3-to-2 vote, Emanuel joined with his Republican colleagues to overturn the Browning-Ferris decision. Organized labor and its congressional allies then initiated a public ethics campaign against Emanuel alleging he improperly voted in the Hy-Brand I case. Shortly thereafter, an anonymous complaint was filed with the Board regarding Emanuel’s vote in the Hy-Brand I decision.

NLRB IG’s Response to the Emanuel Complaint

The NLRB inspector general (IG) seized jurisdiction over the complaint filed against Emanuel and began an extremely aggressive investigation. The IG engaged in extensive conversations with Democrat members of Congress and their staffs. He ignored the fact that Emanuel had been cleared by the DAEO to vote in the Hy-Brand I case and issued a decision finding that Emanuel, on a retroactive basis, improperly participated in Hy-Brand I.

In his decision, the IG used particularly strong language criticizing Emanuel, even though the DAEO had cleared him to fully participate in the case. The primary rationale that the IG utilized to reach this conclusion was predicated on an unsupported legal theory that the Browning-Ferris case and the Hy-Brand I case somehow became the same case for Board ethics procedural purposes.

However, the parties in Browning-Ferris and Hy-Brand I were completely different, the underlying facts in the two cases were also completely different, and Emanuel’s prior law firm did not participate in any manner in the Hy-Brand I litigation. The IG ignored these facts.

The IG eventually concluded that Emanuel did not possess 20/20 hindsight, so there was no intention to engage in any conduct that violated the Board’s ethics policies, but the IG has not, to date, rescinded his recusal decision regarding Emanuel.

The DAEO Actions

The DAEO subsequently agreed with the IG and unilaterally made a decision that Emanuel violated the Board’s ethics policies by voting in the Hy-Brand I case, thereby reversing her prior decision that cleared Emanuel from participating.

Thereafter, the DAEO—a non-presidential nominee—repeatedly refused to communicate with Emanuel and his personal lawyer regarding the basis for her reasoning. She also failed to apprise Emanuel of his options to appeal her decision to the Office of Government Ethics.

As a result of the DAEO’s advice and counsel to the Board (excluding Emanuel), the initial decision in Hy-Brand I was vacated on a 3-to-0 vote, thus reinstating the interpretation of the Board’s joint employer doctrine set forth in the Browning-Ferris case.

Emanuel was never informed that the Board was reconsidering Hy-Brand I and learned of the Board’s action in Hy-Brand II through public news reports. He was never given an opportunity to respond to the recusal motion filed against him.

Conclusions from the Ethics Report

The report does not endorse the IG’s “case merger” theory and notes that the Board’s DAEO, not the IG, should have been the individual providing interpretations of ethics issues.

Further, nowhere in the report is there any authority cited that would permit an inspector general to recuse a presidential nominee and Senate confirmed officer such as Emanuel from participating in cases before the NLRB— because no such authority exists.

The IG, simply put, acted improperly and displayed an overly aggressive and partisan approach to issues surrounding the Hy-Brand cases.

The report also reveals serious missteps and errors by the Board’s DAEO, including the following:

  • She ignored the fact she had previously cleared, without reservation, Emanuel’s participation in Hy-Brand I;
  • She ignored substantial Board precedent that previously permitted Board members faced with recusal motions to individually determine whether they would participate in the case in question;
  • She convened, or facilitated the convening, of several “secret meetings” to discuss with all Board members except Emanuel on how to proceed regarding the recusal motion directed at him— no doubt Board open meeting reporting procedures were violated by such meetings;
  • She incorrectly advised other Board members that if they permitted Emanuel to participate in the Hy-Brand II case, they would be committing independent violations of the Board’s ethics policies;
  • She erroneously persuaded other Board members that Emanuel should not be permitted to participate in any manner in the Hy-Brand II case that vacated the decisions in Hy-Brand I;
  • She failed to advise Emanuel of his right to appeal her initial ethics decision and that of the IG to the Office of Government Ethics; and
  • She initially refused to provide Emanuel and his personal counsel any written analysis of her “reasoning” from excluding him from the Hy-Brand II decision.

Indeed, these substantial errors in Hy-Brand II raise serious questions as to whether this decision is valid, particularly given Emanuel’s improper exclusion from participating in that case.

Stated alternatively, Hy-Brand II was not properly adjudicated, and therefore is null and void. Convincing arguments could be advanced that given the numerous serious errors made in the manner that Hy-Brand II was decided, Hy-Brand I was not properly overruled. Accordingly, the Board’s previously decided decision in Browning-Ferris has in fact been validly set aside.

Further, the timing of the voting on Hy-Brand II raises questions as it occurred only a few weeks before Ring joined the Board as the new chair. The issues surrounding the adjudication of the Hy-Brand case should have been put on hold to permit the new chairman to make an assessment of the matter.

Whatever the motivation, the weaponization of the Board’s ethics polices prevented Ring from participating in any of the issues involving Hy-Brand I and also prohibited him from reviewing how the recusal motion directed at Emanuel should have been handled.

Emanuel and the NLRB Are Owed an Apology

The Inspector General and DAEO owe Emanuel and the Board, as an institution, an apology for the manner in which the Hy-Brand cases were handled.

Further, the names and/or entities that filed the anonymous complaint against Emanuel should be made public to permit an objective assessment of the motives of those individuals that were attacking the Board and attempting to weaponize its ethics policies.

Additionally, the IG and DAEO’s legal memorandum and related documents concerning the ethics issues discussed in the report should also be made public. Finally, the individuals or entities that filed the complaint against Emanuel should publicly apologize to him and his fellow Board members for their inappropriate attempt to weaponize ethics policies and procedures.

There is a positive ending to this story, however—new ethics and process protocols outlined in the report will be implemented by the Board. The new policies will make it much more difficult in the future for any type of Hy-Brand type of abuses to occur.

All other agencies are encouraged to review the Board’s report and utilize it as a model for how ethical issues should properly be handled to avoid weaponization of ethics procedures in the future.

This column does not necessarily reflect the opinion of The Bureau of National Affairs, Inc. or its owners.

Author Information

G. Roger King has practiced labor and employment law for over 45 years, including being a partner at Jones Day, and presently is senior labor and employment counsel for the HR Policy Association.