Obama’s Railway Labour Act Rule

Introduction

The Railway Labor Act is the federal law providing a framework for employer-employee relations in the airline and railway industries. The Act seeks to preserve industrial peace by making provisions for immediate resolution of disputes between carriers and employees and protecting the employees’ right to organize and engage in collective bargaining (Elsenrath, 2014). The Railway Labor Act was enacted in 1926 to govern railway unions and was amended in 1934 to create the National Mediation Board and again in 1936 to extend its purview of application to airlines, at a time when the voice of trade unions was growing and collective bargaining had started to gather momentum as a tool for setting wages and aligning other conditions of work with the physical integrity and moral dignity of the workers (Williams and Halcoussis, 2014). Section 2, Ninth of the RLA empowers the National Mediation Board (NMB), where the identities of carrier employees’ (bargaining) representatives are disputed, to investigate and certify the names of the designated individuals or organizations.

The RLA provides for the right of the majority of a craft or category of employees to choose their representative for collective bargaining purposes. The NMB administers elections for union representation elections. For over seven decades, a union was confirmed as the employee representative for purposes of collective bargaining if “a majority of eligible employees in the applicable draft or class voted for the union” (Saibert, 2010). Under the model, employees who failed to vote were considered to have voted against unionization or organized labor, the rationale for this being that a union had to have genuine majority backing to persuasively negotiate. In 2010, the NMB amended the RLA rules to provide that the certification of a union as the representative of a class or craft for purposes of collective bargaining hinges on a majority of the votes that are cast, as opposed to a majority of the eligible employees in the class or craft (National Mediation Board, 2009).

NMB’s authority to amend federal rules governing labor union legislation

The NMB’s new rule was challenged in federal court on the grounds that the NMB, being an oversight agency, lacked the authority to issue the rule, and that it was inconsistent with the provisions of the Administrative Procedure Act (APA) and the Railway Labor Act (RLA). Section 2, Fourth of the Act does not generally provide guidance on representation and decertification procedures. It specifically does not give directions on the determination of a majority. The lack of guidance implies the NMB has authority to use any reasonable method to establish the intent of the voters.

Section 4 of the Administrative Procedure Act requires the publication of a general notice of the proposed rulemaking in the Federal Register. It must contain information on time, place and manner of public rulemaking proceedings. The Act excludes, among other things, interpretative rules and general statements of policy. The Act requires the agency, upon the publication of the notice, to give interested persons a chance to participate in the rulemaking, inter alia, via submission of views or written data. NMB adhered to APA procedures in amending the rule on elections, allowing for sufficient participation and facilitating the approval of the final rule by the courts.

A notice of the proposed rulemaking was published in the Federal Register on 3^rd November, 2009 by the NMB. The note proposed an amendment to the mechanism of vote tallying for union representation elections. The NMB construed section 2, Fourth of the RLA to mean the number of eligible voters not voting represents a “no” vote. The NMB explained that the interpretation had been used for long because to the 1935 Board it made sense administratively (Abraham et al., 2015). Under the proposed rule, the class or craft representative for purposes of collective bargaining would be decided by the majority of valid votes cast.  Abstention, under the new rule, does not translate to an automatic “no” vote. The new rule means union representation elections will be decided by persons who really vote. In their notice, the NMB, as required by the APA, explained the reasons (in two pages of the Register) for the proposed rulemaking. The judicial review outcome was positive. The NMB provided a description of its statutory rulemaking authority and discretion to interpret section 2, Fourth of the RLA. NMB demonstrated its interpretation was reasonable, and that the rule change would not affect the stability of labor in the airline and railway industries.

Impact of NMB’s new rule on RLA’s check and balance

The purpose of the checks and balances between airline management and labor unions is to enhance continuity and stability in the industry through the provision of remedies. The amendment reinforces the check and balance in the RLA by ensuring the rights of employees who desire to be represented are not impinged through unfair voting procedures. Union representation, which the LRA seeks to promote, is an important check and balance in the airline industry. The new election procedures makes it easier for employees to have representatives for purposes of collective bargaining (Kaps et al., 2012).

The NMB’s refusal to adopt National Labor Relations Board (NLRB) decertification rules, however, means employees cannot easily get out of unions should they feel they are not effectively represented. The NMB practice is that once a union is certified, the NMB can only consider requests for representation after a period of two years. The process for decertification of unions is long-drawn-out as compared to the NLRB. The fact that only valid votes are counted under the new rule means a union can be certified even if only a small number of employees in a class or craft actually vote. The lack of clearly defined exit strategies under the NMB process represents an elimination of the RLA’s check and balance.

Shrinking union membership in the U.S. as the reason for NMB’s rulemaking

The unionization of American workers has been steadily declining since 1945. For instance, unionization dropped from 25% in 1977 to 14% in 1997. As of 2016, unionization has dropped 24% since 1945 (Mitchell, 2011). Generally, unions have been commended for their role in the development of child labor laws, overtime and minimum wage policies. Some of the main reasons for the declining unionization in the United States include the unprecedented growth in classes of labor that less encouraging of unionization, declining pro-union outlooks among American workers, and the generally growing  resistance to unionization by employers. The increasing bargaining power of employers has seen a corresponding decline in employee bargaining power. Employers are now offering gigs as opposed to jobs, so saving has become harder. The amendment to the voting procedures by the NMB, which is meant to increase union membership, is fuelled, inter alia, by the need to evening out the employer-employee bargaining power in the airline industry, and the realization that unions provide critical support to the government in measures such as Medicare for the benefit of all Americans.

NMB’s plan to stack the deck for organized labor in union elections

The NMB has the authority to adopt a reasonable interpretation of a majority of a class or craft and adopt a procedure for union representation elections. Under the 75-year voting rule, a union only won elections if a majority of a class or craft voted in favor of representation. Abstention represented a “no” vote. If, say, a class had 120 members and only 59 voted for representation, the union would not win as the remaining 61 members who did not vote would be deemed to have voted against representation. This rule made it very difficult for airline workers to be unionized, which worked just fine for airline companies. The new rule, much like the regular elections conducted by the NLRB for union representation in industries other than airline and railway, introduces a “No” option at the ballot. This means where 59 members out of 120 vote, a union would win if it gets a simple majority of the valid votes cast.

Under the new rule, it is easier for unions to organize workers. The amendment to the election procedures is made in furtherance of the statutory objectives of the Railway Labor Act, among other things, to provide a more consistent pointer of employee response in disputes relating to union representation and give employees strong options for effective representation (Compart, 2011). The NMB has stacked the deck as airline at the moment and railroad workers can now vote for union representation under the same criteria workers in other industries.

Possibility of re-visiting NMB’s new labor rule

The rule could be re-visited in future by a Republican president (like Donald Trump) or Congress owing, among other things, to the political compromise in 2012, and the opposition by some airline companies such as Delta Airlines. Hot on the heels of NMB’s promulgation of the new union representation rule, the Air Transport Association of America (now Airlines of America) filed suit, inter alia, claiming the rule making was predetermined as the two Obama appointees ignored input by the Bush-appointed chairwoman and failed to involve all interested parties. The then-ATA also claimed that the Obama appointees even attempted to hide their actions by begging their Bush-appointed colleague to not make reference to their behavior in her dissent. Even though the litigation failed, the rule continues to face opposition because it is not clear on decertification. The Senate relied on the Congressional Review Act (CRA) to try to overrule NMB’s Obama-appointees, and has maintained the NMB, being an oversight agency, does not have the authority to amend federal rules governing labor union legislation. The Congress has powers under the CRA to overrule regulations made by government agencies. They could use this window.

Conclusion

The amendment makes it easier for unions to organize airline and railroad employees. A win only requires a majority of eligible voters who actually vote. The amendment, however, goes against NMB’s earlier declaration that only Congress has the powers to drop the RLA’s rule that no voting means voting for non-representation. Under the new rule, a minority voters who are pro-union can choose a representative, a violation of the right of a majority of a class or craft to determine the result of an election.

References

Abraham, S.E., Schur, L.A., & Voos, P.B. (2015). Changing union representation election regimes: What can we learn? In D. &. Lewin, Advances in industrial labor relations (Advances in industrial labor relations, volume 21) (pp. 1-28). Emerald Group Publishing Limited.

Burke, K. (2010). The National Mediation Board’s rule proposal for representation elections: If it ain’t broke… Journal of Air Law and Commerce, 75, 699-703. Retrieved from http://scholar.smu.edu/jalc/vol75/iss3/6

Compart, A. (2011). Reality wins, maybe. Aviation Week & Space Technology, 173(34), 24-24. Retrieved from http://ezproxy.library.und.edu/login?url=http://search.ebscohost.com/login.aspx?direct=true&db=aph&AN=66714555&site=ehost-live&scope=site

Elsenrath, M. (2014). Effect of NMB voting change on airline unionization. Journal of Aviation/Aerospace Education & Research, 23(2), 41-57. Retrieved from http://commons.erau.edu/jaaer/vol23/iss2/2

Kaps, R., Hamilton, S., & Bliss, T. (2012). Labor relations in the aviation and aerospace industries. Southern Illinois University Press.

Mitchell, J. (2011, March 30). U.S. news: Airlines, unions at odds over proposal in FAA bill. Wall Street Journal. Retrieved from http://search.proquest.com.ezproxy.library.und.edu/docview/859042239?accountid=28267

National Mediation Board. (2009). Representation election procedure. Federal Register 74(211).

Saibert, F. (2010). National Mediation Board rule change draws fire. Chicago Daily Law Bulletin, 156(116).

Williams, M.S., & Halcoussis, D.A. (2014). Unions and democracy: When do nonmembers have voting rights? Journal of Business & Technology Law, 9(2), 213-228. Retrieved from http://digitalcommons.law.umaryland.edu/jbtl/vol9/iss2/4