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NLRB Opens the Door for Contract Workers to Engage in Off-Duty Section 7 Activities Wherever They Work

On December 16, 2022, the National Labor Relations Board (”Board”) issued its decision in Bexar County II, which restricts the right of property owners to deny off-duty contract workers access to the property for the purpose of engaging in activities protected under Section 7 of the National Labor Relations Act (“Act”). In line with the current Board’s efforts to undo Trump-era decisions and reinterpret the Act to dramatically expand employees’ Section 7 rights and weaken property owners’ rights to control their property, the Board overturned its own precedent on contract workers’ off-duty access and reinstated its standard first established in the 2011 decision in New York New York Hotel & Casino . The Board’s decision in Bexar County II makes clear that it prioritizes contract workers’ access to a third-party’s property for Section 7 activities over the property owner’s own interests in their property. [1]

The Previous Bexar County I Framework

In 2019, the Board, comprised of a Trump-appointed Republican majority, heard this matter in Bexar County Performing Arts Center Foundation, known as Bexar County I. [2] At the time, the Board concluded the employer, the Bexar County Performing Arts Center, did not violate the Act by ousting the San Antonio Symphony’s unionized musicians from its property when those individuals were there for the sole purpose of protesting the Bexar County Performing Arts Center’s use of recorded music rather than contracting with these musicians to perform live music. Emphasizing a property owner’s right to prohibit certain activities on its own property, the Board ruled that a property owner may bar contract workers from accessing its property for the purposes of engaging in Section 7 activities unless the workers worked “regularly and exclusively on the property” and the owner could not show that they had a “reasonable non-trespassory alternative” for communicating their message. On appeal, however, the U.S. District Court for the District of Columbia rejected this ruling, characterizing it as “arbitrary and internally inconsistent,” and remanded to the Board.

Impact of the Bexar County II Decision

On remand, in a 3-2 decision now dominated by the Biden-appointed majority, the Board concluded in Bexar County II that the Bexar County Performing Arts Center violated the Act by banning the San Antonio Symphony workers from leafletting on its property. In so ruling, the new Board rejected the previous Board’s standard, criticizing it as “stripp[ing] off-duty contractor employees whose employer does not own the property . . . [of their] right to “protest for reasons completely unconnected to the employer’s interest in protecting its property.”

Instead, prioritizing the workers’ Section 7 rights over the owner’s property rights, the Board reinstated the framework first articulated in the Board’s 2011 decision, New York New York. In New York New York, the Board found that contract workers’ handbilling in public areas of the property owner’s hotel-casino was permissible because it “did not interfere with operations or discipline [nor] adversely affect the ability of customers to enter, leave, or fully use the facility . . .”

Going forward, property owners may exclude contract workers from their property under the new standard announced by the Board only when their Section 7 activities “significantly interfere” with the property’s use or where the owner has “another legitimate business reason” to eject them.  The Board noted that legitimate business reasons include, but are not limited to, the need to maintain production and discipline. Under the employee-friendly New York New York framework, this reinstated standard focuses on the activity’s impact while neglecting property owners’ rights and interests.

To offset the blow to property owners’ rights, the Board provided in its decision that a property owner could negotiate contractual terms with its contractor to require the contractor to quickly intervene if the contractor’s employees engaged in off-duty Section 7 activities on the property. Though the Board also provides that a property owner could direct the contractor’s managers and supervisors to take action and the property owner could exercise its own “managerial interests” to enforce its property rights, property owners should refrain from directing contractor’s employees in this fashion to avoid creating a joint-employer relationship.

Members Kaplan and Ring dissented, criticizing the majority opinion for failing to balance an appropriate accommodation between the competing Section 7 and property rights at stake.

Conclusion

The Bexar County II ruling expands contract workers’ ability to engage in Section 7 activity on a property where they work, even though their actual employer does not own the property. Property owners and/or employers should review their agreements with their contractors to ensure contractors are solely responsible for preventing their employees from causing disruptions at the property owner’s/employer’s location.

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[1] New York New York Hotel & Casino, 356 NLRB 907 (2011), enfd. 676 F.3d 193 (D.C. Cir. 2012), cert. denied 568 U.S. 1244 (2013)

[2] 368 NLRB No. 46 (2019).