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Bad News For Labor On Election Night; Unions To Shift Focus To Agencies

November 9, 2010

A big win for the GOP on both the federal and state levels means a bad night not only for unions but also for those who advocate for legislative expansion of individual employee rights through greater protections for new protected classes or broader statutory coverage for amendments to existing legislation, such as the FMLA or ERISA, or the development of new legislation on topics such as workplace "bullying."

Nevertheless, unions especially will turn their efforts now to changes at the administrative agency level in order to further their agenda.

At the federal level, the election results kill any remaining hope unions had for traditional labor law "reform" through initiatives such as the Employee Freedom of Choice Act ("EFCA"). On the state level, where Republicans also did well, for example in Michigan, the public sector unions are likely to face more legislative pressure on topics such as privatization of public services. And at the state level, even Michigan may see consideration of "right to work" legislation which would make labor agreement "union shop" clauses requiring mandatory union dues deductions unlawful. Such legislation, on the books for many years in a number of southern and western states, typically has the effect of weakening unions at the plant and regional level as it results in reduction of dues revenue and local grass roots support for the union.

Also at the federal level, any talk of expanding FMLA rights for employees, introducing mandatory paid leaves, or expanding the protected categories in employment to include categories such as sexual orientation are effectively off the table. With a divided Congress and President Obama maintaining his veto power, however, it is unlikely any repeal or rollback of legislation in this area will happen.

That scenario means that the real action in labor and employment law, especially for unions, is likely to happen at the agency and court level. The Obama Administration still effectively controls the National Labor Relations Board and its prosecuting wing, the General Counsel's office, and will as long as the President remains in office. Through rule making and its decision process on individual cases, the NLRB could continue on the generally pro-union path on which it appears to have already embarked. While subject to appeals of the court system, NLRB rulings in the near future on subjects such as union activist employees' use of company computer and information systems and stiffer penalties like punitive damages on employers found liable for unfair labor practices can result in significant changes in the law in this area.

In Michigan, look for changes in the Michigan Employment Relations Commission in both procedural and substantive areas as new Governor Rick Snyder seeks to "reinvent" the state. Changes in workers' compensation and unemployment compensation procedures and regulations are not likely to be far behind.

Employers should also watch out for court-made changes in case law or statutory interpretations, especially at the federal level. A large number of Clinton and Obama-appointed judges serve at the trial and appellate court levels, and could play an increasingly activist role in interpreting statutes and case law to expand employee and union rights in light of what promises to be a dry season for any type of federal legislative changes.

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