Union Poster Rule Overturned: “Victory for Small Businesses”

right-to-unionize-workers

A federal appeals court has overturned a decision that would have required small business owners to display “right to unionize” posters in the workplace. The posters would have been extremely detailed. The consequences of not displaying posters could have been severe.

The National Association of Manufacturers, the National Federation of Independent Businesses (NFIB) and others including two small business owners, had appealed a lower court ruling requiring the posters.

On appeal, the U.S. Court of Appeals determined the National Labor Relations Board (NLRB) could not require this new rule.  The Court essentially said that (1) the compulsory posters violated the employer’s free speech rights, and (2) the NLRB’s proposed enforcement action exceeded its rule-making authority.

The right to unionize poster

Under the rule, small business owners would have been required to hang an 11-by-17 inch poster in the workplace. Posting also would have been required on a company’s intranet. The proposed posters would have had very detailed language (see embedded court decision below, pages 31 to 34, for the text).

The small businesses and groups that filed the challenge noted that the posters were one-sided.  Among other things, the posters did not notify employees of their rights to decertify a union, to refuse to pay dues to a union in a right-to-work state, and to object to paying excess union dues.

The rule also attempted to require small business owners in right-to-work states to comply with the NLRB mandate.

Penalties for failing to post

The posters themselves weren’t the only issue, though.  It was the serious consequences of not posting them that had the two small businesses and their advocates up in arms.

Had small business owners not put up the poster,  they could have been charged with unfair labor practices. On top of that, they could have been opened up to investigations and other broad actions on unrelated claims.  The rule went beyond established labor law and regulations in existence today.

The NFIB, a non-profit that advocates on behalf of small businesses, spoke also about the concern of accidental  violations.  The NFIB noted, ”small businesses are particularly vulnerable to accidental violations because the regulatory compliance burden most often falls on the small business owner and because small businesses do not have dedicated compliance staff.”

The National Association of Manufacturers noted on its Shop Floor Blog:

“During oral argument before the Court of Appeals, one judge asked the attorney representing the Board a basic question. What, if any, limits are there on the NLRB’s authority? The attorney quickly — and shockingly — responded that in the Board’s view there are no limits to their power. Yesterday, the Court issued a strong rebuke to that line of thinking and highlighted the shaky ground the NLRB is on with regard to its agenda.”

The NFIB hailed the decision s a victory for small businesses. “Today’s decision is a monumental victory for small business owners across this country who have been subject to the illegal actions of a labor board that has consistently failed to act as a neutral arbiter, as the law contemplates,” NFIB’s executive director of its Small Business Legal Center Karen Harned said in a statement.

The National Association of Manufacturers represents 11,000 manufacturers in the United States. It was founded in 1895 and is based in Washington, D.C.

The NFIB is a Nashville, Tennessee based organization founded in 1943. It represents 350,000 small-business owners. Membership is made up of small businesses, 60% of which have 5 or fewer employees, and 55% of which have gross sales of $350,000 or less.

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4 Comments ▼

Anita Campbell - CEO


Anita Campbell Anita Campbell is the Founder and Publisher of Small Business Trends and has been following trends in small businesses since 2003. She is the owner of BizSugar, a social media site for small businesses, and also serves as CEO of TweakYourBiz.com.

4 Reactions

  1. Thank heavens. That would have been a highly intrusive requirement for SMBs. If employees aren’t educated enough (or can’t do the research in the internet age) to know they can unionize it’s their own fault.

    • Anita Campbell

      Hi Robert — I think it’s an example of overreach by the NLRB. Notifying of rights is one thing — but this stepped way over the line because it would have created penalties that far exceed what the law has traditionally allowed.

      It’s not like labor law isn’t well established. Why it needs to be expanded in such an onerous way is something I don’t understand.

  2. Kip Marlow

    Thanks so much for writing this. The ruling by the NLRB, even when overturned by the court, still is a concern. What does the NLRB have ups its sleeve for the future? We need to be constantly vigilant when any agency could continue to be so anti-business.

  3. great! Who has room on their walls for another poster – already have too many of them that you should not need; low minimum wage law, workers compensation, fair labor practice, maternity leave, OSHA stuff, MSDS, business license.

    There should be a poster that says “If you have to hang up this sign you most likely are doing business in an unfair state or Country”.

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