Will federal preemption ensnare state "captive audience" measures?

To supporters, it’s the “Worker Freedom Act.” To detractors, an “Employer Gag Bill.” Call it what you will: On June 30, Oregon Governor Ted Kulongoski signed S.B. 519, a bill that prohibits an employer from holding mandatory employee meetings to convey its views on religious and political issues—including union organizing. With its passage, Oregon became the first state in the nation to bar “captive audience” meetings. It’s a win for the AFL-CIO, which had launched a campaign to enact such legislation at the state level. The victory may be short-lived, however, as the Oregon measure will surely face a legal challenge.

Captive audience bills, if enacted in the states, would have a considerable impact on traditional union-organizing campaigns. One federal government survey found employers force workers to attend captive audience meetings in 92 percent of union election campaigns and that employers, on average, held 11 such meetings during every organizing drive. Why? Because they are a particularly effective weapon in the employer’s union avoidance arsenal, and they are difficult for unions, lacking equal access, to counter.

The Oregon statute (like the AFL-CIO’s model legislation) bars employers from compelling employees to attend meetings aimed at communicating the company’s opinions on “religious or political matters.” (Notably, it bars any forced attempt by an employer to convey its views on unionization, not just the captive audience meeting.) While it does not limit the right of employers to hold these meetings or engage in such communications, it provides that attendance must be strictly voluntary; employers may not discharge or discipline employees who refuse to attend or to listen to the employer’s message. Nor may employers retaliate against employees for exercising their rights under the statute. Aggrieved employees can sue for backpay and reinstatement, among other relief. The statute provides a mandatory award of treble damages, attorney fees and costs.

(The Oregon law isn’t just about union organizing, though. Its bar on coercive political and religious speech is meant to grant more expansive protection. The Oregon AFL-CIO cites the example of a worker who was disciplined after walking out of the lunchroom after his employer began to make anti-Catholic statements. And, last year, during the presidential election campaign, Wal-Mart famously required employees to attend meetings in which they were told their jobs could be threatened if Democrats were elected. S.B. 519 would prohibit this conduct as well.)

Federal labor law does not prohibit compulsory meetings, nor does it bar employers from imposing discipline on employees who refuse to attend or leave a meeting held for the purpose of conveying the employer’s opposition to a union. In fact, Sec. 8(c) of the National Labor Relations Act (NLRA) expressly confers employer free-speech protections, so long as the speech is not coercive or threatening. However, although the National Labor Relations Board has upheld mandatory meetings, unions contend they are inherently coercive, in that they force employees to listen to anti-union speech, and that they are meant to intimidate workers. So, organized labor has endeavored to enact protections at the state level that federal law does not provide.

Thus far, such legislation has made few inroads. The Michigan and New Hampshire legislatures have passed Worker Freedom bills. The Colorado legislature passed a bill in 2006 that was ultimately vetoed by the governor. Washington’s state legislature held hearings on a measure earlier this year. The legislation has been introduced in several other states, including Connecticut and West Virginia. (New Jersey enacted the Worker Freedom from Employer Intimidation Act in 2006, a bill that protects employees from being forced to hear employer speech on religious and political matters, but it excludes discussions of labor organizations from its reach.)

The Oregon measure will go into effect on January 1, 2010—if it can withstand inevitable challenges on preemption and constitutional grounds, that is. Opponents of the bill contend that state efforts to regulate employer speech in the union-organizing context are preempted by the NLRA. They cite California’s failed attempt to do so, noting that state’s “union neutrality” law was struck down by the US Supreme Court in its 2008 ruling in Chamber of Commerce of US v Brown. In 2005, the Seventh Circuit held a similar ordinance enacted by a Wisconsin municipality was preempted by the NLRA.

Paul Secunda, a professor of law at Marquette University School of Law (and member of the Wolters Kluwer Labor and Employment Law Editorial Advisory Board), argues that such laws should not be preempted. He notes that, notwithstanding the NLRA, states retain the right to regulate employer property rights and contractual relations between employers and employees.

Will S.B. 519 pass muster? We’ll soon find out, as Oregon employers have already indicated they will challenge the statute. The legislation “saddles employers with the potential for devastating liability by creating a new protected class of employees,” noted J.L. Wilson, of the Association of Oregon Industries, a business group that opposed the measure. “[The bill] would severely inhibit an employer’s ability to communicate with its workers and, most importantly, would diminish the competitiveness of Oregon employers.”