Daily Labor Report®

Trump Labor Board Chief Rejects Democrats’ Ethics Concerns (1)

Nov. 8, 2019, 9:00 PMUpdated: Nov. 8, 2019, 9:24 PM

The federal labor board’s top official Nov. 8 shot back at Democrats on Capitol Hill who have accused the board of using new regulations to sidestep ethical concerns about Republican members’ conflicts of interest.

“I categorically reject any suggestion that there are ethics problems at the NLRB or that the Board has undertaken rulemaking to enable individual members to avoid compliance with their ethical obligations,” National Labor Relations Board Chairman John Ring (R) said in a letter to Sen. Patty Murray (D-Wash.) “These are baseless claims, which I have already addressed, and the partisan press reports cited in your letter, based as they are on incomplete information, do not make them any more valid.”

The letter, responding to an earlier missive from Murray, marks the latest chapter in an ethics controversy that has dogged the Republican-controlled board since shortly after President Donald Trump was inaugurated. The debate has centered on whether Ring and other members are required to sit out certain cases because of ties to the management-side law firms where they worked before joining the board.

The board will soon release the results of a comprehensive ethics review that Ring ordered early in his tenure.

Board members on both sides of the political spectrum have long been faced with recusal questions, often stemming from their previous work as lawyers for unions or businesses. Those questions came under a microscope in 2017, when the board decided to scrap a precedent-setting decision in a case involving Hy-Brand Industrial Contractors. The move came after the NRLB’s inspector general said member William Emanuel (R) should’ve sat out the case because the board used it to overturn an Obama-era decision involving one of Emanuel’s former clients, which was still on appeal at the time.

McDonald’s Decision Looms

The Hy-Brand case would have overhauled the board’s approach to “joint-employer” liability, or shared responsibility for collective bargaining and unfair labor practices by businesses in staffing, franchise, and other contract arrangements. The NLRB is finalizing a regulation that would cement an approach similar to that the board had planned to establish in the Hy-Brand decision.

Democrats have slammed the regulation as an end-around, designed to skirt ethics rules that otherwise would require Emanuel to sit out any case to overhaul the joint employer standard.

“As my colleagues and I have expressed to you before, there are serious concerns that the NLRB is using rulemaking in some cases to avoid compliance with NLRB members’ individual ethics obligations,” Murray said in an Oct. 24 letter to Ring.

Ring and Emanuel have yet to decide on requests that they recuse themselves from a closely watched case involving McDonald’s. Lawyers for workers at McDonald’s franchise restaurants claiming they were retaliated against for participating in Fight for $15 demonstrations say Ring and Emanuel should sit the case out because their former firms—Morgan Lewis and Littler Mendelson—advised the company on how to respond to the demonstrations.

“As you know, the Board has conducted a comprehensive internal review of its ethics and recusal processes, the final report of which will issue in the coming weeks,” Ring told Murray. “The review, which included benchmarking against the standards and practices of other federal agencies, confirmed that the Board’s internal ethics and recusal safeguards are strong. We also identified particular areas for improvement.”

NLRB member Marvin Kaplan (R) said in a separate letter to Murray that he has been cleared by the agency’s designated ethics officer to participate in a new rule that would ban student employees from unionizing on college campuses.

Murray previously called on Kaplan to sit out the regulation which would overturn an Obama board decision in a case involving student workers at Columbia University. Although Kaplan’s wife works as a doctor at the school’s medical center, he said the ethics officer determined concerns that the new regulation would impact his financial interests were “too speculative.”

(Updated to include information from Kaplan letter.)

To contact the reporter on this story: Chris Opfer in New York at copfer@bloomberglaw.com

To contact the editor responsible for this story: Martha Mueller Neff at mmuellerneff@bloomberglaw.com

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