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New Labor-Backed Oregon Legislation Probably Preempted by Federal Law

Organized labor’s primary goal for the 2009 Oregon bi-annual legislative session was to pass a law barring employers from conducting mandatory meetings or otherwise communicating with employees about their views on whether employees should unionize.  This came in the form of Senate Bill 519 (SB 519).  On June 22, 2009, the Oregon House of Representatives passed SB 519 by a 34-24 vote.  Earlier, the Senate had passed the bill by a narrow 16-14 vote.  If signed by Governor Ted Kulongoski, the law would go into effect January 1, 2010. 

The bill prohibits both public and private employers from discharging, disciplining or otherwise penalizing an employee who refuses to attend “an employer-sponsored meeting or communication with the employer . . . if the primary purpose of the meeting or communication is to communicate the opinion of the employer about religious or political matters.” 

“Political matters” are defined to include the decision on whether to join a labor organization.  Although much attention paid to SB 519 has focused on the prohibition against mandatory group meetings, it is also important to note that SB 519 arguably gives employees the unfettered right to reject all “communication” with their employer about union organizing.   

Employees may file civil lawsuits against their employers alleging violations of SB 519.  If successful, employees would be entitled to reinstatement with back pay, liquidated damages equal to triple the amount of lost wages, attorneys’ fees and costs.  Finally, regardless of any alleged violations, all employers would be required to post a notice apprising employees of their right not to communicate with employers about unionization.   

NLRA Preempts Certain Local and State Laws

The NLRA, as a federal enactment intended to occupy the field of labor relations law, is considered to have a preemptive effect on most local and state laws purporting to regulate private sector labor-management relations.  The NLRA has recognized two “preemption” doctrines: Garmon and Machinists.  Garmon preemption, based on the concern that state regulation may interfere with national labor policy, applies when there is an actual or potential conflict between state regulation and federal labor law.  Such a conflict may occur when the state attempts to regulate an activity actually or arguably is regulated by the NLRA.  See San Diego Building Trades Council v. Garmon, 359 U.S. 236 (1959).

Machinists preemption is based on the premise that Congress intended certain activities remain free from all federal and state regulation.  See Lodge 76, Int'l Ass'n of Machinists v. Wisconsin Employment Relations Comm., 472 U.S. 132, 140 (1976).  That is, when an activity is not prohibited or protected by the NLRA, it is assumed that Congress intended for the activity be governed by the free play of economic forces.

Section 8(c) of NLRA

Congress added Section 8(c) to the National Labor Relations Act, the nation’s principal labor relations law, in the early1940’s to guarantee private sector employers the freedom to express “any views, argument, or opinion, or the dissemination thereof, whether in written, printed, graphic, or visual form . . . if such expression contains no threat of reprisal or force or promise of benefit.”  

After the addition of Section 8(c), the National Labor Relations Board permitted employers to hold mandatory meetings, but required them to grant unions an equal opportunity to be heard.  Bonwit-Teller, Inc., 96 NLRB 608 (1951).  Two years later, the NLRB reversed course in the seminal case of Livingston Shirt, 107 NLRB 400 (1953).   It held, “[A]n employer does not commit an unfair labor practice if he makes a preelection speech on company time and premises to his employees and denies the union’s request for an opportunity to reply.” Allowing employers to conduct mandatory meetings to discuss views on union organizing has been a fundamental tenet of federal labor law for more than 50 years.      

 State efforts to limit employer speech so as to aid union organizing appeared to have suffered a costly defeat last year in Chamber of Commerce v. Brown, 128 S.Ct. 2408 (2008).   An array  of prominent employer organizations, including the U.S. Chamber of Commerce, successfully challenged a California law that prohibited private employers from using state funds to discourage union organizing.  Jackson Lewis was proud to represent the employer associations. 

After years of litigation at the California taxpayers’ expense, the U.S. Supreme Court held the state law was preempted under Machinists because it “impose[d] a targeted negative restriction on employer speech about unionization,” which cuts directly against “congressional intent.”  The High Court also made clear that federal labor law has been carefully crafted “to encourage free debate on issues dividing labor and management.”  The Court premised its holding on the recognition that Section 8(c) of the NLRA was added as a manifestation of “congressional intent to encourage free debate on issues dividing labor and management.”  Indeed, it was an “explicit direction” from the Legislative Branch.  Thus, the Supreme Court reaffirmed that federal labor law is premised on employees learning about unions through a free and robust debate.

SB 519 Assaults Federally Protected Employer Communications Rights

Following Brown, state or local attempts to prevent employees from having the benefit of a free and open debate are now clearly subject to challenge.  SB 519 is one such attempt. 

SB 519 is a direct assault on the rights conferred on employers under Section 8(c).  If local and state governments were permitted to enact such legislation, the country’s uniform system of federal labor law could be transformed into a patchwork of state-specific restrictions.  Indeed, if SB 519 is acceptable, laws prohibiting unions from approaching employees at their homes or distributing flyers encouraging employees to support the union also might be acceptable. 

The Supremacy Clause of the U.S. Constitution ensures that federal law is not supplanted by inconsistent local or state requirements.  Should Governor Kulongoski sign SB 519 into law, a judicial challenge likely would follow.  Given the Supreme Court’s recent pronouncement in Brown about the importance of keeping noncoercive employer communication free from state regulation, it seems SB 519 is headed for troubled waters.     

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