Wednesday, May 4, 2016

Insubordination or Protected Concerted Activity: Know the Difference or Pay the Price

Too often, employers think of “protected, concerted activity” as conduct that, in some way, directly relates to union activity.  In other words, conduct engaged in by union workers in such a way that it cannot be mistaken such as picketing, conducting union organizing campaigns or meeting to discuss collective bargaining strategies and issues.  In Staffing Network Holdings, LLC, the United States Court of Appeals For the Seventh Circuit was quick to remind employers that this is not necessarily the case.

In Staffing Network Holdings, LLC the National Labor Relations Board held that non-union employees who were engaged in protected concerted activities are also protected by the National Labor Relations Act.  While this is not new, both the NLRB findings and the court’s affirmation of those findings are instructive.  

In Staffing Network Holdings, LLC, the employee conduct in question was subtle.  The employees worked for Staffing Network Holdings, LLC, which provided labor for a company called ReaderLink.  The employees were responsible for filling book orders for ReaderLink.  One employee was asked to speed up on the production line.  The employee’s response to his supervisor was that he was not going to speed up for $8.25 an hour.  The employee’s response resulted in the employee’s immediate termination.

Subsequently, other employees came to the aid of the terminated employee, arguing that he was being treated unfairly.  In addition, one of the other employees, Ms. Barrera, actually stated that the supervisor’s conduct was “against the law” and that the employees need to “stand up against all the injustice” committed against them.  Barrera’s employment was terminated as well.  She filed an unfair labor practice charge with the NLRB alleging that the employer threatened termination and did in fact terminate her for engaging in protected concerted activity.

The employer argued to the NLRB that the decision to terminate Barrera was based upon insubordination or that she was not terminated because the staffing company could have placed her somewhere other than ReaderLink.  The administrative law judge found these arguments disingenuous and contradictory.  Because of these contradictions, the ALJ and subsequently the court found that the employer lacked credibility.  The NLRB ordered the employer to reinstate the employee and make her whole for lost wages and the court affirmed the decision.

The main lesson in this case is that when employees appear to complain about how they are being “treated,” prior to finding the complaints insubordinate and terminating the employee, the employer should “cool off” and analyze the conduct and the statements to be certain that they do not amount to protected concerted activity.  In the instant case, one employee made a smart comment about the wage rate.  He was quickly terminated.  Other employees questioned the fairness of the decision.  One of them was summarily terminated.  In short order, the employer bought itself a very expensive case because it reacted emotionally.  Remember, if employee speech sounds like it is related to wages, hours or terms and conditions of employment, with today’s NLRB, it probably is, and employer’s need to be careful.  A cautious and analytical approach to such situations can save an employer the costs of litigation as well as back pay and the embarrassment of reinstating a wrongfully terminated employee.