On November 8, 2024, the National Labor Relations Board (“NLRB”) issued a landmark decision in Siren Retail Corp. d/b/a Starbucks, overturning an almost 40-year-old precedent that allowed employers to tell employees how unionization could affect their working relationship. The NLRB’s new standard will apply to all cases filed after November 8, 2024.
The Previous Standard
In 1985, the NLRB ruled in “Tri-Cast, Inc.” that employers were lawfully permitted to inform employees that their relationship with the employer would change if they unionized. Specifically, employers could explain that once a union is involved, individual grievances would no longer be addressed directly by the employer. This decision established a broad rule allowing employers to communicate the negative consequences of unionization as long as the statements were truthful, which became the prevailing standard for decades.
The Starbucks Case
In the “Siren Retail Corp.” decision, the NLRB criticized the Tri-Cast rule, noting that it “categorically immunized nearly any employer statement to employees touching on the impact that unionization would have on the relationship between individual employees and their employer,” even if such statements “could have a reasonable tendency to coerce employees.” Although the Board applied the Tri-Cast standard in the Starbucks case to avoid an unfair outcome, it made clear that the rule would no longer apply in future cases. The NLRB overruled Tri-Cast prospectively, stating that this shift would take effect for all cases filed after November 8, 2024.
The “New” Standard
The NLRB’s ruling in “Siren Retail Corp.” effectively replaces the Tri-Cast framework with an older standard from NLRB v. Gissel Packing Co., a 1969 decision by the U.S. Supreme Court. Under the Gissel rule, employer statements regarding the impact of unionization are assessed on a case-by-case basis. Employers must “carefully phrase” these statements, ensuring they are based on “objective fact” and reflect the employer’s belief about the “demonstrably probable consequences” of unionization that are beyond the employer’s control. If, however, the statement suggests that the employer will act “solely on his own initiative for reasons unrelated to economic necessities,” it will be considered an unlawful threat.
What Should Employers Do Now?
With the new standard in place, employers are required to ensure that any statements they make about unionization are not only fact-based but also carefully worded to avoid any potential for coercion. Since the analysis is now conducted on a case-by-case basis, employers face uncertainty regarding the legality of their communications. Our DC employment lawyers recommend employees protect their rights and seek proper legal counsel.