Monday morning musings for workplace watchers

The Guy Behind the Guy | About those Arbitration Agreements | Opt Out Options

Chris Opfer: Leaders of many of the country’s largest labor unions huddled last week to discuss whether the AFL-CIO should call for Labor Secretary Alex Acosta to resign over his controversial role in hedge fund boss Jeffrey Epstein’s teen sex trafficking prosecution. They also talked about another divisive issue: what to do about Virginia Gov. Ralph Northam (D).

The AFL-CIO’s executive council, which comprises 55 representatives of member unions, voted unanimously in early February to call on the governor to resign after an old yearbook photo surfaced, purportedly showing Northam in black face. But during the Feb. 26 phone conference, some council members questioned whether the group rushed to judgment, sources tell me.

Northam has denied being in the photo, which shows one Virginia medical student in black face and another in Ku Klux Klan garb. He did admit to donning black face at another point in his life as part of a Michael Jackson costume. More importantly, the next two Democrats in line to replace Northam have been shown to have their own closet skeletons. In the days after the photo’s appearance, Lt. Gov. Justin Fairfax was accused of rape and Attorney General Mark Herring admitted that he dressed in black face during college. If all three were to step down over the scandals, that would leave Virginia House Speaker Kirk Cox—a Republican known for opposing efforts to address racial gerrymandering in the state—with the keys to the governor’s mansion.

Cox, who supported an effort to enshrine Virginia’s right-to-work law in the state constitution, is seen as an enemy of organized labor. That’s why at least some unions—not to mention other groups that quickly called for Northam to step down—have since gone mighty quiet.

An AFL-CIO spokesman didn’t respond to my question about whether the governor still needs to go. Doris Crouse-Mays, president of the Virginia AFL-CIO, told me through a spokesperson that Northam has taken steps “to make amends,” but that the state affiliate stands by its call for him to resign.

Perhaps some lingering concern about the Virginia situation also contributed to the AFL-CIO’s decision not to call for Acosta to step down. A federal judge ruled that Acosta broke the law by not telling Epstein’s alleged victims about a plea deal that let him off with what critics called a slap on the wrist.

In deciding to let the court process play out, along with a Justice Department investigation and possibly a congressional inquiry, some union leaders focused specifically on Pat Pizzella, who would take over at DOL if Acosta stepped down. The deputy labor secretary previously worked with disgraced lobbyist Jack Abramoff to oppose labor protections in Northern Marianas sweatshops. Pizzella would likely take a more aggressive, business-friendly approach than Acosta if he were in charge.

Jaclyn chatted with Florida attorney Loren Donnell about the DOL’s new approach to pay rates for tipped workers, in this week’s Punching In podcast.

Jaclyn Diaz: By no means have we heard the last of the Epstein story. In fact, I’ve heard that Acosta was, until recently, debating drafting an op-ed offering his view on the controversy. It’s unclear whether that’s still in the works.

Speaking of sexual misconduct allegations, and how best to resolve them, I wanted to take another look at arbitration agreements.

In case you’ve been under a rock, employers are living for mandatory arbitration these days. Major tech companies found themselves the subject of criticism (if you’re Mark Zuckerberg, kind of the norm these days) for requiring employees to agree in advance to arbitrate any sexual harassment or assault in the workplace claims. In many situations, there’s a confidentiality requirement, too.

Part of arbitration’s popularity with employers stems from the U.S. Supreme Court’s Epic Systems decision, in which the justices gave employers wide range to enforce arbitration agreements with their workers, even if the pacts bar class-action claims.

But an arbitration agreement between a company and its employees isn’t binding on the Labor Department. The DOL has the power to enforce a large group of workers’ wage and hour and other rights in open court, assuming department lawyers choose to exercise that authority.

Labor Solicitor Kate O’Scannlain has been offering mixed signals on what the department will do in cases involving workers who have signed arbitration agreements. We previously reported that O’Scannlain informed regional offices that she wants to know about those cases ahead of time.

So what does that mean? O’Scannlain was asked that question two weeks ago at a Practicing Law Institute event in New York. She said the department hasn’t taken a definitive stance on whether it will pursue lawsuits against companies in cases where the workers have signed arbitration agreements.

“We continue to have the authority to bring our enforcement matters even if an arbitration agreement exists,” she said. “But it’s something I care about knowing because we do have limited enforcement resources and I want to make sure we are using our limited resources in the most efficient and effective way. If there are other avenues for people to pursue, I want to know that.”

CO: National Labor Relations Board General Counsel Peter Robb last week told a group of lawyers in California that he wants the board to force unions to give workers information about the “fair share” fees they will have to pay if they choose not to join. A day later, Robb put out a memo saying he will urge the NLRB to require unions to divulge that info before workers make their decisions about membership.

Robb also used the memo to dip his toe into a related and increasingly important question about just how many hoops unions can make workers jump through to opt out of membership. Some labor organizations have made it harder for workers to opt out, especially in states where right-to-work laws prevent them from charging the fair share administrative fees. Ditto in the public sector, where the Supreme Court last year banned the fees.

Robb said unions can’t require workers to opt out 60-75 days before a collective bargaining contract expires and/or to do it by certified mail. But the general counsel also left the door open to all kinds of other possible restrictions on dropping union membership, as long as workers have the right to do so at least once a year and when the contract expires. That presumably includes shrinking opt-out periods to small annual windows of time.

JD: Before we punch out, I received some news on who will be leading the DOL’s new Office of Compliance Initiatives, a sub-agency first announced in August 2018. Starting today, the office will be led by former Mine Safety and Health Administration official S. Marisela Douglass, who previously worked in the agency’s Office of Program Policy and Evaluation. OCI will be under the purview of the Office of the Assistant Secretary for Policy and is meant to focus on the DOL’s favorite topic these days, compliance assistance.

We’re punching out. Daily Labor Report subscribers can check in during the week for updates. In the meantime, feel free to reach out to us on any and all labor and employment news: copfer@bloomberglaw.com, and jdiaz@bloomberglaw.com or on Twitter: @ChrisOpfer and @JaclynmDiaz.

See you back here next Monday.

Bloomberg Law® helps labor and employment law practitioners provide rapid, accurate, and complete advice to clients, by bringing together trusted, market-leading Bloomberg BNA content like Daily Labor Report® and treatises like Covenants Not to Compete: A State-by-State Survey and The Developing Labor Law, with a fully integrated, innovative legal research platform. Click here to request a free trial.