On October 13, 2023, the Regional Director of Region 1 of the National Labor Relations Board (“NLRB” or “Board”) filed a petition in federal court in Massachusetts asking the Court to issue an injunction against a Salem, Massachusetts cannabis employer that had prevailed in a February 2022 election besting the United Food and Commercial Workers Union, Local 1445 (the “Union”) 17 to 11.  The Board’s petition seeks an injunction ordering the employer to do all the following, on an “interim basis pending a final Board order”:

• Recognize and bargain in good faith with the Union;
• To rescind the unlawful discipline issued to multiple employees; and
• To reinstate two employees whose employment had been terminated.

The Petition follows the Regional Director’s conclusion that there is reasonable cause to believe that the employer violated Section 8(a)(1) of the National Labor Relations Act by engaging in coercive pre-election conduct.  According to the Regional Director, the Injunction is necessary “to ameliorate the effects of [the employer’s] unfair labor practices during the pendency of the underlying administrative proceeding.”

A Win Is Not Necessarily a Win at the NLRB

The dispensary faces an ongoing battle at the NLRB, and now in federal court, despite what seemed to be good news – a win for the employer during the NLRB’s February 2022 secret ballot election.  Unfortunately, that win was short-lived, as the Union (as labor unions often do) filed objections to the election alleging that the employer engaged in a wide variety of unfair labor practices. The Union alleged that, after the Union’s demand for recognition, the employer engaged in the following conduct to dissuade employee support for the Union:

• Held mandatory meetings during which upper-level management members delivered their anti-union message;
• Issued written warnings to union sympathizers, including terminating one of them;
• Disciplining and, then terminating, a vocal union supporter for violating a rule that had not previously been enforced.

After being combined with various unfair labor practices, the case was tried to an NLRB administrative law judge (the “ALJ”) over multiple days in February and April, 2023.

The case was pending before the ALJ when the NLRB issued its game-changing decision in Cemex on August 25, 2023. In Cemex, the NLRB abandoned fifty years of precedent and created a new framework for union elections in the U.S. Under this new framework, if a union makes a claim of majority support, the employer must: (1) immediately grant recognition without any NLRB election, or (2) file its own NLRB petition, an RM petition, seeking an election promptly. Additionally, under the Board’s decision in Cemex, nearly any unlawful conduct during the “critical” period leading up to the election will prompt the Board to issue a mandatory “bargaining order” requiring union recognition. This new standard significantly lowers the threshold for a bargaining order.

In issuing his decision on September 21, 2023, the ALJ noted:

Recently, in Cemex Construction, supra, the Board … announced a new framework, which is to be applied retroactively to all pending cases, when an employer unlawfully refuses to recognize and bargain with the designated majority representative…

In applying the new framework, a remedial bargaining order is appropriate when: (1) the employer refuses the Union’s request to bargain; (2) at a time when the Union had in fact been designated as representative by a majority of employees; (3) in an appropriate unit; and then (4) the employer commits unfair labor practices requiring the election to be set aside.  I conclude each factor is met in this case….

I.N.S.A., JD-60-23 (Sept. 21,2023). The ALJ applied the Cemex decision – which was decided nearly 18 months after the underlying election – and ordered the dispensary to bargain with the Union.  Like all ALJ decisions at the Board, it is only a recommended decision that is subject to exceptions to the Board in Washington D.C.  As expected, the dispensary filed exceptions to the Board on October 19, and the matter is likely to be pending before the Board for months, if not years.

The NLRB’s Injunction Seeks Interim Relief

While the NLRB has broad authority to enforce the National Labor Relations Act, it does not have the ability to promptly require employers to take certain action in most circumstances.  In extraordinary circumstances, however, the NLRA empowers the General Counsel to seek injunctive relief in the federal courts. Specifically, Section 10(j) of the NLRA provides:

The Board shall have power, upon issuance of a complaint as provided in subsection (b) [of this section] charging that any person has engaged in or is engaging in an unfair labor practice, to petition any United States district court, within any district wherein the unfair labor practice in question is alleged to have occurred or wherein such person resides or transacts business, for appropriate temporary relief or restraining order. Upon the filing of any such petition the court shall cause notice thereof to be served upon such person, and thereupon shall have jurisdiction to grant to the Board such temporary relief or restraining order as it deems just and proper.

The NLRB must specifically authorize the General Counsel to file a petition for 10(j) relief and the agency typically only files a dozen or so a year.  However, like everything else, that number is steadily increasing and has nearly tripled in the past three years (from 8 petitions filed in 2020 to 21 petitions filed in 22). The Petition is currently before a federal district court judge who will decide whether to grant the Petition and require the employer to bargain with the Union even before the Board issues a final decision in the underlying case.

The Regional Director’s Petition in the I.N.S.A. case not only seeks a bargaining order, but also an order from the Court immediately reinstating those bargaining unit workers who were terminated during the course of the Union campaign.

Conclusion

The NLRB’s increased use of 10(j) injunctions is just the latest example of the Board’s aggressive approach to union organizing.  Not only is Section 10(j) litigation expensive, but it also provides unions with yet another weapon in their efforts to organize.  With increased organizing in industries such as cannabis, it is more critical than ever for employers to take a proactive approach to remaining issue-free. Bianchi and Brandt’s attorneys can help employers stay ahead of these issues.