New union election rules create an expedited timeline for dispensary operators

Missouri Greenway
December 22, 2023 Publications

The National Labor Relations Board (“NLRB” or the “Board”) has issued new quick election rules that will take effect on December 26, 2023.

Previously, union organizing campaigns typically followed a predictable process. First, the union would obtain “authorization cards “signed by employees, authorizing the union to act as their representative.   After a majority of the employees in the particular group seeking to be organized (the “bargaining unit”) sign authorization cards, the union would ask (or demand) that the company “recognize” that the union represented a majority of its employees.  In response, the company had three choices: (1) voluntarily recognizing the union; (2) asking a neutral third party to verify the validity of submitted authorization cards; or (3) refusing to recognize the union based on doubt that they actually represented a majority of employees.  This third alternative would force the union to petition the NLRB, which would then conduct a secret ballot election.

The previous NLRB union organizing rules allowed at least three weeks after a petition was filed for both the union and the company to campaign before a secret ballot election would be held.   In some cases, legal disputes arose concerning the election, such as the composition of the bargaining unit or whether certain individuals should be eligible to vote.  At times, the resolution of such disputes would delay elections by several months or more.

Now, all stages of the election process are subject to truncated deadlines and limited briefing.  Highlights of the most impactful changes include the following:

  • Pre-election hearings must now be scheduled within eight business days following a petition for an election, which is about ten days earlier than before.
  • Regional Directors now have limited discretion to extend deadlines, and generally may only do so for “special” or “extraordinary” circumstances.
  • Challenges to employees’ eligibility to vote or to their inclusion in a bargaining unit are now held after the election, rather than before.
  • Regional Directors are not required to accept post-hearing briefs.
  • The mandatory twenty business day waiting period that occurred after the NLRB issued a decision and direction for election is eliminated and elections must now be scheduled “as soon as practicable.”

Under the new rules, an employer presented with authorization cards signed by a majority of employees in an appropriate bargaining unit a company must either:

  1. recognize the union as majority representative based on the presented authorization cards; or
  2. must promptly file a petition for election with the NLRB.

However, if the employer commits an unfair labor practice that previously would have warranted a re-run election, now as a remedy for the unfair labor practice the NLRB will require the company to recognize and bargain with the union as the employee’s representative.  The anticipated result of this change is a substantial number of unions installed without a secret ballot election, increasing overall union representation.

The new representation rule is made more challenging for companies by the NLRB’s significant, precedent-changing decisions issued in 2023.

For example, certain company policies and practices including, for example, confidentiality agreements, non-disparagement clauses, social media policies, civility codes, restrictions on the use of company email systems, and distribution of literature in the workplace, among others, were lawful in 2022 but are no longer so.

The mere maintenance of now-unlawful employment policies may form the basis for an unfair labor practice charge, which the NLRB may remedy by requiring the company to recognize and bargain with the union without a secret ballot election.

While the elimination of unwarranted delay is a laudable goal, serious questions are raised by the new NLRB approach.  Authorization cards, which are sometimes signed under pressure by co-workers, are poor substitutes for a secret ballot election if the goal is discovering whether, in fact, a majority of employees choose to be represented by the union.  Towards that goal, employees would benefit from hearing both the pros and cons of unionization before making their choice, especially given the fact that once recognized, the union cannot be decertified, or removed by employees, for at least one year.

Companies operating in the cannabis space should be proactive in addressing the challenges presented by the new rule and the changes in law.  Companies should immediately identify and train those individuals who would be deemed supervisors by the NLRB because their actions and statements are binding on the company. They must be able to talk candidly with employees about the union and respond factually to their questions within legal restrictions. Handbooks and employment policies or agreements should be reviewed for compliance with the new NLRB standards.

It is only a matter of time before most cannabis businesses in Missouri face unionization efforts.  Given the new NLRB election rule and the change in applicable NLRB law, proactive preparation should be a business priority.


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