May 6, 2024 • 41 mins
Bob is fascinated by the balance between the need for regulation and the vast growth of the administrative state. We are also fascinated by just how much the political winds impact the law...even though we like to believe it is solid and hard to change. Look no further than the 88-year-old National Labor Relations Act, and the National Labor Relations Board (NLRB) which it created. It is now under fire at the Supreme Court.
A product of the New Deal, the NLRB has yet to face such a challenge in the modern era, but major companies like SpaceX, Starbucks, and Trader Joe's have marshaled a constitutional challenge to the legitimacy of its composition and enforcement activities, hoping to eventually find a sympathetic ear before the U.S. Supreme Court, currently controlled by a conservative majority.
These arguments range from challenges to the board's impartiality to issues concerning the separation of powers doctrine, given the inability to remove board members except “for cause,” to violations of due process and deprivation of the right to trial by jury under the Fifth and Seventh Amendments, respectively. And given the Biden NLRB's aggressive policy and enforcement prerogatives, these arguments have begun to become commonplace defenses against its actions.
John Balitis knows the NLRB. He knows what it is like to "walk in" and face an administrative investigation/prosecution/enforcement/judicial and appellate body...ALL IN ONE!
His prediction? Somehow the board...which impacts virtually every workplace...is likely going to be a different animal once the Supreme Court rules. How different? What does it mean for employers? Employees?
Take a listen now!
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Bob Sewell (00:04):
Is that even legal?
It's a question we askourselves on a daily basis.
We ask it about our neighbors,we ask it about our elected
officials, we ask it about ourfamily and sometimes we ask it
to ourselves.
The law is complex and itimpacts everyone all the time,
and that's why we are here.
I'm attorney Bob Sewell andthis is season five of the
(00:26):
Worldwide Podcast that exploresthat one burning question.
Is that even legal?
Let's go.
Today's guest on the show isJohn Blitas.
He's a well-known attorney inArizona.
He practices labor andemployment matters.
He is considered an expert inthe field.
(00:47):
John, welcome to the show,Thanks.
John Balitis (00:50):
Bob, thanks for having me.
Bob Sewell (00:53):
I was wanting to have you on because of your
expertise in labor law, and Irecently came across some
articles about the NationalLabor Relations Board and
National Labor Relations Act andbasically what I'm seeing in
these articles is that somewell-known large employers
Starbucks, tesla, elon Musk,trader Joe's and a few others
(01:19):
are starting to claim that thisact, starting to claim that this
act, this act that's beenaround for nearly 100 years is
unconstitutional.
Have you?
John Balitis (01:33):
heard these things Right.
Oh yeah, it's kind of a bigstory now nationally and it's
focused really more on theNational Labor Relations Board
than the act itself.
I mean people think of the twosort of like together because
they're paired.
When Congress passed theNational Labor Relations Act in
(01:54):
the 30s, as part of the New Dealit created the National Labor
Relations Board as an agencythat is dedicated to enforcing
the act.
And really what is stirring upthe constitutional controversy
now is the structure of theboard itself, not so much the
(02:15):
act, because the act as a law, Ithink, is perfectly fine.
The board, on the other hand,with the way it's composed, is
accounting for constitutionalchallenges.
And I'll add that what'sinteresting about sort of the
current environment and whatwe're seeing in terms of these
challenges is.
this is not the first time it'shappened.
(02:37):
The board is structured in avery unusual way which we'll
probably talk about way whichwe'll probably talk about and
soon after it was created in the30s.
These same constitutionalchallenges were made to the
board's composition back then,and the Supreme Court rejected
(02:59):
them.
But I think what you're seeingnow is like we've seen with, for
example, reproductive rights.
The court in a modern era, witha different political
composition, is now looking tobe right to overturn itself, and
so we have people coming backmaking the same arguments that
they made in the 30s, with thehope that the Supreme Court will
come out differently on them.
Bob Sewell (03:20):
Yeah, let me back up a little bit for our listeners.
Yeah, let me back up a littlebit for our listeners.
Back in 1935, franklin DRoosevelt.
He's president.
He's looking for ways toincrease employees' rights.
He's looking for ways to helpthe common man get back on his
feet.
Congress passes the NationalLabor Relations Act and the
(03:44):
enforcement arm is the NationalLabor Relations Board and
essentially what this act isdoing is it's helping private
sector employees collectivebargain, it's helping them, with
their establishment, maintaintrade unions and it's
(04:06):
essentially just trying to helpthe worker gain power against
the employer.
Now the board is there and asthis enforcement arm and as the
administrative tool to addressthe issues found in the act, do
I got this right?
John Balitis (04:27):
Yeah, no, you're absolutely right, and I think
what's interesting about the actand of course, like you said,
the board is there to design andcreate it, to enforce it Is
that the I think, generallyspeaking, people think of the
National Labor Relations Act asa federal law that governs
unionized workforces, and to alot larger extent it does.
(04:51):
Like you just mentioned, itgives workers the right to
organize, bargain, unionize andso on.
But the act also applies to allprivate sector employees,
whether they're unionized or not, in other respects which a lot
of businesses forget, and theone most important part of it
(05:12):
that I'm talking about is theright embedded in the act for
workers to communicate with oneanother about their wages, hours
and working conditions, even ifthose communications are highly
critical.
And if an employer violates, orallegedly violates, any of
these parts of the act, tries tochill workers' rights to
(05:34):
unionize, organize, bargain, ortries to chill their
communications among one another, that then results in an unfair
labor practice charge whichthen goes before the board to be
adjudicated, and then that'show the board and the act sort
of work together to make up thewhole picture.
Bob Sewell (05:54):
So what is it about the board that's changed?
John Balitis (06:00):
Nothing about the board has changed.
It's the same structure that wehad when it was created back in
the 30s.
I just think what we have nowis, even though we have a
Democrat in the White House,which accounts for a swing back
toward an effort to enhanceworker rights, the Supreme Court
(06:22):
in its current way, it way it'scomposed, was populated by a
Republican, and I thinkRepublicans are, generally
speaking, historically known forwanting to enhance employer
rights.
Business rights changed.
(06:49):
I think the lobby forbusinesses and employers sees an
opening to try and convince thecourt to change its view on
whether the board itself isconstitutional, because we have
a court populated largely byRepublican justices right now
that probably would be keen totaking that up right now.
That probably would be keen totaking that up.
(07:09):
But we can get into it.
It's the structure of the boardthat makes it so unusual, that
makes it susceptible to thesechallenges.
Bob Sewell (07:14):
Tell me about that.
John Balitis (07:17):
Well, you know, the board at the risk of
oversimplifying it is not reallya good place to be.
If you're an employer, you knowif you're facing one of these
unfair labor practice chargesbrought by a worker or a group
of workers, and the reason isthat you have prosecutors,
(07:37):
judges and an appellatestructure all under one roof.
That's what's so unusual aboutthis body structure all under
one roof.
That's what's so unusual aboutthis body.
So when you're embroiled as arepresentative for an employer
at the board, you kind of feellike the deck is stacked against
you because all of thosefunctions are all under a single
(07:58):
umbrella at the board.
And so what that translatesinto from a constitutional
standpoint is you've got aprosecutorial arm, which is
generally thought of as anexecutive function, you've got a
judicial arm, which are theadministrative law judges and
the appellate structure withinthe board.
(08:19):
And then keep in mind that theboard also makes policy and
engages in rulemaking, which isfundamentally a legislative
process.
And so you look at thisstructure, you know, sort of
like in a simple way, and it'skind of like how can all this
coexist in one place?
Because all of this, accordingto the Constitution, is supposed
(08:40):
to be separate.
So that, I think, is theprimary structural challenge to
the board's composition.
There are other constitutionalarguments that are being made
about it, but from a structuralstandpoint that's really what's
going on.
Bob Sewell (08:55):
Yeah, that's odd, not odd, but it's interesting
that that's the way the board isset up and you could see why.
You know well, the traditionalwisdom is that when we have a
Republican, pro-employer personin charge, a president in charge
, and that the board is morefriendly toward employers, and
(09:21):
when we have a Democrat incharge, and that's a Labor
Democrat, generally consideredto be less friendly towards the
employers.
And you could see that would betrue because you're getting all
of these functions under thesame roof.
Have I got this right?
John Balitis (09:41):
Yeah, yeah, yes, you do, but the thing that's
going on now is no one's goingto the board and saying we would
like you to declare yourselfunconstitutional.
What's happening is SpaceX,starbucks, trader Joe's, amazon
they're all filing lawsuits infederal court, hoping to get up
(10:02):
to the Supreme Court, andthey're making arguments about,
for example, separation ofpowers, which is just what we
just discussed, and they'retaking the position that the
board as a body should no longerexist because it violates
fundamental constitutionalprinciples.
And although we have a Democratin the White House, which is
probably loathing this effort,who is loathing this effort?
(10:26):
We have a court, though, thatis a majority conservative bent
now, which is pro-business, andthe thinking is that if we
approach the court with theconstitutional challenges in
2024 that were first made in the1930s, we may actually have a
run at getting the court toreverse itself and maybe not
(10:49):
dissolving the board, butdismantling pieces of it, and
that's what's going on right now.
I think the employers and theirattorneys are seeing this as an
era where there's an openingbecause of the political
affiliation of the justices onthe court is an opening because
of the political affiliation ofthe justices on the court, and
if they can do that, thenCongress would have to step in.
Bob Sewell (11:11):
They'd have to reorganize the board and
introduce legislation, and in aCongress that is paralyzed it's
not likely to change much, orrather it's not likely to get
going in reorganizing the board.
Is that what they're thinking?
John Balitis (11:29):
Yeah, I think you're hitting the nail on the
head because, frankly, I mean itwould be a mess, you know, if
the challenges succeeded even inpart.
And, like I said, I don't seethis being sort of like an all
nothing proposition, becausewe've got arguments about the
fact that we've got SeventhAmendment arguments, we've got
(11:50):
Article III arguments, we've gotthe separation of powers
argument.
So there's a number and I thinkthis is deliberate.
Let's try as many arguments aswe can make this is from the
standpoint of the employers tosee what we might accomplish
here.
And if you just took one ofthose and convinced the court,
(12:12):
yeah, this creates a problem.
So we're going to have to carvethis out of the board structure
, we're going to have todismantle this aspect of the
board.
It would really be chaotic.
And so I think the, theemployers are thinking you know,
no matter how much of this wecan succeed on, it's going to be
good for business.
Right, and that's the approach.
(12:34):
I think that's the thinking.
Bob Sewell (12:56):
One of the things that bothers the average
American is we want to thinkthat the law is well settled,
that you could point to the lawand one court say no, that's not
constitutional.
Another court that says it'sconstitutional.
How do you respond to that?
John Balitis (13:14):
That's the way it is.
I mean, you could look at it asjust a feature, or maybe as a
vulnerability, of what otherwiseis an extraordinary
constitutionally basedgovernment.
Because you know, people cantalk about the executive branch
and the legislature and all that.
I've always thought and maybeit's because of just my
(13:37):
background in law like yours,that I think the Supreme Court,
those nine people, are probablymore powerful than just about
anybody else, and what you justdescribed is the reality,
because you can.
Roe v Wade is a perfect exampleof it and, like the average
citizen sitting back going, Iwish I could have some permanent
(13:57):
stability in the way laws areinterpreted and enforced.
It just can't happen because wehave two primary political
parties with 180 degreedifferent beliefs about
fundamental issues reproductiverights, gun control, capital
punishment and so on and thefact is that when you put
(14:17):
justices on the Supreme Courtthat are members or affiliates
of one party or the other, thatcan color how decisions are made
right, and that's just.
It's ingrained in our system Idon't know how you'd ever get
away with it, or get away fromit.
Bob Sewell (14:34):
I should say yeah, I've had constitutional law
experts on, we've discussed thisissue and the response is
always well, that's theConstitution.
And just because we believe wehave it right on day one doesn't
mean we have to believe we haveit right on day two and we
could be and should be a dynamicsociety.
(14:56):
And essentially that's theargument.
And if we don't like it, whatthe justices?
John Balitis (15:13):
did.
We can just go back and changethe Constitution or get new
legislation and try new thingsthat may work.
Yeah, I mean that's the escapevalve.
I mean if you don't like whatthe court did, then just muster
it up and then pass somelegislation and then undo the
court.
You know the court's decisionright, but it's also a function.
You know it's not just purelypolitical right, because there
are really two schools ofthought.
When you talk about if you'vehad the constitutional people on
(15:36):
, you probably know this.
I mean, there are some judicialofficers who look at the
constitution and say you have toread this and interpret it and
apply it as a living document,because when it was created no
one could foresee what'shappening today in hundreds of
different ways in modernAmerican society.
(15:57):
Then there are other judicialofficers who say, no, they are
strict constructionists.
You have to read this thing theway it's written and you can't
look at it like a livingdocument.
So you have these two competingjudicial views of how to
interpret the Constitution andthen overlay that with politics,
(16:17):
and it's a kind of a complexproposition, which is why you
see what's happening happening.
Bob Sewell (16:26):
Now I want to get back to the constitutional
issues within the National LaborRelations Board, and if big
employers are successful indismantling portions of the
board or causing the board to,or causing Congress to go back
(16:47):
and redraft, is that bad forlabor?
John Balitis (16:57):
No, it's not bad for labor.
If by labor you mean managementbusiness employers, it's not
bad at all.
Bob Sewell (17:04):
Is it bad?
I guess it's bad for theemployee.
John Balitis (17:08):
Well, I think the answer to that probably is yes,
because the board is a very,very employee-friendly place, at
least in my.
I mean, I can't speak foreveryone, right, but we talked
about how it's unusual to haveprosecutors, judges and an
appellate structure all in oneplace.
You walk in there as anemployee, you're feeling pretty
(17:30):
confident, you walk in there asthe employer and, like I said
before, you get the sense thatthe deck is stacked against you
before you start.
So if parts of the board weredismantled, I think it would
dilute the I won't say it's abias, but it would dilute the
(17:53):
level of comfort I think thatemployees would have in using
that agency to enforce theirrights, because right now it's
kind of like a perfect storm offunctions that all I think are
very helpful to workers.
And I mean, I'm not speaking,like I said, I can't speak for
everyone else, but I thinkthat's pretty commonly thought,
(18:16):
right.
Bob Sewell (18:18):
Yeah, yeah, I mean, you know.
I mean if you've ever been anemployer, been on, you know an
attorney for an employer, whichyou have.
I'm certain a lot of employershave found themselves in the
crosshairs of the boardinadvertently.
(18:42):
Oh yeah, that happens all thetime.
You know, I have family membersthat work for big corporations
and their middle management isconstantly violating the act and
they're like don't go anyonewhat we're you know.
Don't go out and tell anyonewhat we're paying you now, you
(19:03):
know, labor worker, because wedon't want this to get out right
.
Well, that's not going to gowell with the board, so I could
see this.
John Balitis (19:16):
That's an understatement board.
Bob Sewell (19:22):
So I could see this.
That's an understatement.
I could see this as an employerperspective the frustration
that when you find yourselfbefore the board, you find
yourself being disciplined, youfind yourself paying out or
something to this effect.
And you weren't trying to be anevil employer, you're trying to
be a good employer.
You tried to be a good employer.
Am I getting this right?
Have you seen this happen?
John Balitis (19:43):
Yeah, you're getting it right because you
walk in, like you know,figuratively speaking, and it's
like the person who'sinvestigating the charge against
you and who's going toprosecute it, the prosecutor's
there and who's going toprosecute it?
The prosecutor's there andyou're already in trouble
because otherwise you wouldn'tbe talking to the prosecutor,
because the prosecutor's sittingdown and saying, okay, let's
(20:07):
develop a trial schedule Becauseyou go to trial.
You basically go there and it'slike a trial and in front of an
administrative law judge, andthen so this person, who's the
investigator, the prosecutor,who's a lawyer, is going to
prosecute you and then you go infor your trial and the
administrative law judge is apart of the same agency where
(20:31):
the prosecutor works.
And then you get a result andyou want to appeal it and then
the appellate structure, theboard, is under the same roof as
the prosecutor and theadministrative law judge.
So how are you going to feel asthe employer walking into that
scenario, hypothetical you gaveabout don't tell anybody about
(20:59):
what we're paying you.
That that's like a perfect.
That's one great example of howan employer could trip up and
find themselves with a with acharge, uh, going to trial
because the the act says you,you non-supervisory staff
personnel, workers have theright to talk about wages, hours
and working conditions.
You can't.
You can't tell have the rightto talk about wages, hours and
(21:21):
working conditions.
You can't tell grassrootsworkers not to talk about their
comp.
That's not lawful under the act.
One other area that we saw thisunwitting violation of the act
and tons of employers gettingcharges filed and being brought
up before the board was whensocial media whatever 10, 15
years ago, you know became sopopular that people were really
starting to use it.
(21:41):
The engine, the social mediaengine, was gearing up and
workers were online on Facebookand you know, instagram didn't
exist back then but whateverplatform they were on grousing
and complaining about conditionsat work and in really critical
ways, like calling theirsupervisors profane names and
things of that nature, and theemployers were just getting
(22:03):
incensed by this and just firingpeople.
And none of the employersreally gave thought to the fact
that social media was just adifferent way, a different
platform to communicate.
You can talk face to face, youcan talk over the phone, you
could email and text or youcould be on a social media
platform complaining, but theemployers were so frustrated by
(22:26):
this chatter online that wascritical of them that they sort
of lost sight of what the actrequired or prohibited and there
was a time when we were tellingclients you have to look past
this.
You know you can't disciplinesomebody for complaining about
their job on social media.
(22:47):
And it was another great, greatexample of employers sort of
walking into the buzzsaw and noteven realizing it.
Bob Sewell (22:55):
Oh, yeah, well, and I understand the frustration
from the employer perspective,right, I mean, there's websites
dedicated, dedicated to being a,a, you know, to criticizing
your employment, your employerand or praising them, which
(23:19):
which is less likely to happen,but criticizing and describing
what it's like to work there.
I think a glass door is one ofthem.
But part of me also says, hey,but from the labor perspective,
isn't that a good thing that weshould be able to go out and
(23:39):
talk about our employers andtalk about the conditions of
work?
And this makes the employermore sensitive, because they
have to compete with otheremployers in the same field for
better conditions, bettertreatment.
John Balitis (24:04):
I think, like in a vacuum.
What you just said is a goodobservation and is accurate,
just like if you just took whatyou said and just assessed it
the way you said it.
Here's the problem Despite thebenefits that you have for sort
of having this transparentsystem where people can complain
and then it creates competitionand it creates reasons for
(24:28):
employers to improve, there arecollateral benefits to it.
I think what the employersargue about is where the board
draws the line.
What the employers argue aboutis where the board draws the
line, and what I mean by that ishow profane and critical and
angry can that communication getbefore it loses its protection
(24:49):
under the act?
Because what you said makesperfect sense In an ideal world.
If it was just like oh you know, kind of like a suggestion box,
I think it would be better ifwe, you know, had Starbucks
coffee in the lounge, notgeneric coffee.
Yeah, me too.
I think that coffee is horrible.
Okay, well, you know whatever.
But when you start saying, whenyou start calling your
(25:11):
supervisor names, and when itgets to that point, I think
employers generally look at itand say why is this protected?
And the response from the boardhistorically has been this is
where we're going to draw theline.
If there's a threat of violenceor commentary or remarks in
that communication that wouldpotentially cause harm to
(25:35):
somebody, that's where we willsay the communication loses its
protection.
So you can call your supervisora profane name and criticize
him or her all day long, but ifyou say I think we should go
over to the supervisor's houseand do something, then you've
stepped as the employeecommunicating you've stepped
(25:55):
over the line and I think mostemployers would argue that line
is way too far to one side.
You know, we should pull theline more toward the center and
not allow a lot of thisprofanity and criticism to go on
, because it isn't entirelyconstructive, it's disruptive,
(26:16):
right.
Bob Sewell (26:18):
Now with regard to the structure of the board.
When we have the rulemaking,the enforcement, the police
function right all under oneroof, that's incredibly
efficient.
John Balitis (26:57):
Right and people don't have to walk down the
street or across town to getfrom the prosecutor to the judge
or the appellate body.
Really efficient.
We're all here, we're all inone place.
But on the other hand, itcreates well.
Employers perceive that itcreates problems because the
(27:21):
employers perceive that itcreates a bias and, what's more
important, efficiency.
Or having a truly neutralagency, like if you take the
Equal Employment OpportunityCommission, another federal
agency that was created toinvestigate, that was created to
investigate, not always enforce, but investigate
(27:44):
anti-discrimination laws.
Right, it's not like that overthere.
They investigate charges, theyrender findings and then if
someone, if the worker, isdissatisfied with the finding or
wants to take it a step further, they go down the street to the
(28:04):
courthouse and file a lawsuitin federal court.
Completely separate.
The judicial enforcementmechanism for those laws and the
agency that investigates thealleged violations are
completely separated.
Bob Sewell (28:20):
But that's not how the board operates violations
are completely separated, butthat's not how the board
operates.
So what do you think?
Do you think if you were abetting man and you had to go to
Vegas and you had to make adecision, you got a thousand
bucks?
You must lay a wager.
Are we going to find thatportions of the board are
(28:42):
unconstitutional, and whichportions do you think you'd be
most likely to bet areunconstitutional or
constitutional?
John Balitis (29:02):
choice of the matter, I got to put a wager
down.
I'm going to say, because ofthe current composition of the
court and seeing what happenedwith Roe v Wade, that I think
it's likely that somethingemployer-friendly is going to
come out of this, meaning, ifyou want to translate, that
there's going to be a tweak oran adjustment to the structure
of the board.
That would be my.
It's just a prediction and it'skind of a tough call when you
confront me with a question likethat, but if you want me to
(29:23):
predict, I'll say you know, onbalance, yeah, I think
something's going to happen Interms of which one of these
could potentially fly.
I mean, we've talked about theseparation of powers, but we
haven't talked about the SeventhAmendment issue, which is, you
know, a lot of remedies, yeah, alot of the remedies the board
(29:45):
has.
The other thing about the boardis that it has extraordinary
remedy power.
I mean it has, it has the this,this stunning remedy power that
even federal district courtjudges don't have in terms of
what it can do.
You know it.
Just, it can force employers tohire workers back, do it can
force employers to hire workersback.
(30:06):
It can force employers to postthings on their walls, eliminate
policies, create policies,change policies.
It's extraordinary.
And the constitutionalchallengers are saying now, in
today's world, why aren't theseclaims and remedies being heard
and decided in the jury trialprocess?
These really are claims thatthe Constitution guarantees the
(30:31):
litigants or parties, if youwill a right to trial by jury,
and right now they're gettingdecided by administrative law
judges.
So there is something that Ithink is pretty catchy, right.
And then the other.
Then you have the Article IIIargument, which is all these
administrative law judges getappointed.
Okay, that's fine, but theysidestep the Article III process
(30:55):
entirely.
There's no nominationconfirmation process, senate
hearings, votes, right, nothing.
They're federal judicialofficers.
No, they're federal judicialofficers that get appointed and
then they're there.
And so what happens to Article3?
Why aren't these federaljudicial officers subject to the
(31:17):
Article 3 process?
So these the separation ofpowers argument is kind of like
a.
I think there's a ton ofvalidity to it.
The reason I think thatprobably isn't going to be the
one that gets the box ticked offis because that's the one that
could theoretically dismantlethe whole operation.
(31:39):
I think it's more likely thatyou're going to see something
like a Seventh Amendmentargument succeed or an Article
III argument succeed, whichwould not be nearly as
disruptive as succeeding on theseparation of powers argument.
So long answer to a shortquestion, but that's kind of
where I come out.
Bob Sewell (31:58):
And the Seventh Amendment argument would.
It would be that I have a rightto a jury trial.
Of course I have a right to ajury trial that you're deciding
my, you're deciding my, my fate,and it's it's a matter of $20.
Right, I mean, I could see that.
In which case would we have aadministrative law judge
(32:20):
presiding over a jury trial,have an administrative law judge
presiding over?
John Balitis (32:23):
a jury trial.
Well, I guess that's the wayyou could tweak it.
You could tweak it that way andyou could say okay, well, we
won't remove the ALJs, They'llstill be there, but we're going
(32:43):
to impanel juries for a certainnumber of or certain types of
claims that come up throughthese charges.
Or you could just extract allthose administrative law judges
from the whole agency and sayyou know, we can have the board
itself and the prosecutors there, but the charges now are going
to get litigated to federalcourt in front of an Article 3
judge.
You know, there could be, andall I'm saying is that there are
multiple, probably, solutionsto address the issue the Article
(33:04):
3 issue if it passes somemuster with the court.
A lot of times we talk in lawand with developments like this
sort of metaphorically, andthere's a lot of real world
stuff going on here Now.
(33:30):
When President Biden won theelection and we put a Democrat
in the White House, we weretelling clients at the time,
back in 2020, you're going tosee a huge shift in policymaking
and you had a nice four yearsunder the Trump administration
with employer friendlyrulemaking and legislation and
decisions and so on.
It's going to shift.
It might take a couple fewyears to shift, because you
can't change these thingsovernight, but you're going to
see a shift right, and so whatwe're talking about today is a
(33:55):
court that was populated by aRepublican, so you have efforts
to really exploit the Republicanaspect of the court, but in the
current administration, it'sgoing in exactly the opposite
direction.
So this Tuesday, the FederalTrade Commission voted to outlaw
non-compete agreements.
Bob Sewell (34:17):
Yeah.
John Balitis (34:18):
It's just extraordinary.
On Tuesday, the Department ofLabor announced that the salary
threshold for exempt workers isgoing up, so millions of workers
are now going to be entitled toreceive overtime if they don't
meet the salary thresholdrequirement for an exemption
(34:38):
from overtime right.
The board, in 2023, decided toprohibit non-disparagement
provisions and confidentialityprovisions in severance
agreements with workers.
So all of these things are theproduct of political changes and
(35:00):
political biases in the system,and nothing is nothing sort of
is a clear example of thishappening than when you take the
National Labor Relations Board,when you look at one of the
first things that Joe Biden didafter he was inaugurated that
day is he fired Peter Robb, whowas the Trump-appointed general
(35:25):
counsel of the National LaborRelations Board, and he
appointed Jennifer Abruzzo,who's now the general counsel of
the National Labor RelationsBoard.
It's one of the first things hedid after he was sworn in, and
it is a real-time, real-lifeexample of just how pronounced
politics is in terms of howrights the rights of workers and
(35:52):
employers alike are affected bythese developments.
And so that goes beyond thediscussion today.
It goes beyond a discussionjust about the board, but it's
all part of this whole tapestryof what's going on with politics
and the Supreme Court.
It's really interesting, butit's not just a theoretical talk
(36:15):
, it's reality.
Bob Sewell (36:16):
I guess is what I'm saying oh yeah, absolutely, and
people forget that theadministrative side of the
government you know, somethingthat came about primarily during
the great depression era, wherewe started to see the rise of
(36:39):
the administrative state has ahuge effect on our lives and we
haven't explored those issuessince the Great Depression and
whether or not theadministrative state should
(36:59):
stick around.
And during the Great Depressionthere was all sorts of
challenges where we said, hey,you have these wings of the
government that are creatinglaws that aren't the bodies that
we asked to create laws.
We didn't ask, we didn't electanyone at the National Labor
Relations Board.
John Balitis (37:19):
Exactly.
Bob Sewell (37:21):
We elected, you know , joe Schmoe Senator, joe Schmoe
, house of Representativesperson and so it seems we're
approaching 100 years of theadministrative law, the rise of
(37:41):
the administrative sector.
Yeah, I think it's time torelook at these issues and for
America to consider them oncemore.
And the fact that you have aSupreme Court that's willing to
do it.
It's an interesting fact and Ithink it's being overlooked by
mainstream media.
I think it's because mostpeople don't understand the
(38:05):
administrative state.
So, john, yeah, I think that'sa great point, go ahead this has
been incredible.
John Balitis (38:13):
What I was going to say is yeah, just to cap off
on that, I sent around a clientalert on Wednesday about the
FTC's decision aboutnon-competes and the caveat in
the alert was this is going toget challenged in multiple
lawsuits and people are going tobe making the argument that you
(38:34):
just made, which is the FTC isnot the body that legislates for
us.
It's an administrative agencyand you can't let the FTC or
other administrative agenciescreate and enforce the
equivalent of laws.
And that's your point.
I think it's a great point andI think it's going to start
(38:55):
getting a lot more attention.
Bob Sewell (39:03):
Oh right, the these you know you could from a very
that, that that alert you sentout, or regarded the, the and
non-compete clauses in contractswith employers and employees,
the.
From a very Lawyerlyperspective, this was something
that we primarily dealt with ata state level, and every state
(39:26):
had the right to make theirpolicy on non-competes.
And now we have the federalgovernment stepping in and
basically just wiping out ourstate laws and saying, well, we
think this is the best way, ourstate laws and saying, well, we
think this is the best way.
And instead of being able tocompete state to state for
(39:48):
employers, arizona is alwaystrying to say we are the best
state, come, bring yourbusinesses here and make our
population your workforce.
You know we now have thefederal government stepping in
on a really significant piece oflegislation and not even anyone
(40:10):
we elected.
Right, you're absolutely right,john.
Thank you for coming on.
It's been incredible having you.
You're very well versed inemployment law and labor
relations, and it's it's reallygood to talk to someone and hear
what they have to say.
So thank you.
Thanks for listening to thepodcast.
Is that Even Legal is nowlistened to in 100 countries and
(40:34):
available on virtually allpodcast platforms.
Leave us a review, send us someshow ideas and do so at
producer at evenlegalcom.
Don't forget, as smart as wesound and as lovable as we are,
we are not your lawyers and weare not giving you legal advice.
But if you need some legaladvice, get some.
(40:56):
There are some great lawyersout there and we are always
ready to help.
See you next time.
Is that even legal?
It's a question we askourselves on a daily basis.
We ask it about our neighbors,we ask it about our elected
officials, we ask it about ourfamily and sometimes we ask it
to ourselves.
The law is complex and itimpacts everyone all the time,
and that's why we are here.
I'm attorney Bob Sewell andthis is season five of the
(00:26):
Worldwide Podcast that exploresthat one burning question.
Is that even legal?
Let's go.
Today's guest on the show isJohn Blitas.
He's a well-known attorney inArizona.
He practices labor andemployment matters.
He is considered an expert inthe field.
(00:47):
John, welcome to the show,Thanks.
John Balitis (00:50):
Bob, thanks for having me.
Bob Sewell (00:53):
I was wanting to have you on because of your
expertise in labor law, and Irecently came across some
articles about the NationalLabor Relations Board and
National Labor Relations Act andbasically what I'm seeing in
these articles is that somewell-known large employers
Starbucks, tesla, elon Musk,trader Joe's and a few others
(01:19):
are starting to claim that thisact, starting to claim that this
act, this act that's beenaround for nearly 100 years is
unconstitutional.
Have you?
John Balitis (01:33):
heard these things Right.
Oh yeah, it's kind of a bigstory now nationally and it's
focused really more on theNational Labor Relations Board
than the act itself.
I mean people think of the twosort of like together because
they're paired.
When Congress passed theNational Labor Relations Act in
(01:54):
the 30s, as part of the New Dealit created the National Labor
Relations Board as an agencythat is dedicated to enforcing
the act.
And really what is stirring upthe constitutional controversy
now is the structure of theboard itself, not so much the
(02:15):
act, because the act as a law, Ithink, is perfectly fine.
The board, on the other hand,with the way it's composed, is
accounting for constitutionalchallenges.
And I'll add that what'sinteresting about sort of the
current environment and whatwe're seeing in terms of these
challenges is.
this is not the first time it'shappened.
(02:37):
The board is structured in avery unusual way which we'll
probably talk about way whichwe'll probably talk about and
soon after it was created in the30s.
These same constitutionalchallenges were made to the
board's composition back then,and the Supreme Court rejected
(02:59):
them.
But I think what you're seeingnow is like we've seen with, for
example, reproductive rights.
The court in a modern era, witha different political
composition, is now looking tobe right to overturn itself, and
so we have people coming backmaking the same arguments that
they made in the 30s, with thehope that the Supreme Court will
come out differently on them.
Bob Sewell (03:20):
Yeah, let me back up a little bit for our listeners.
Yeah, let me back up a littlebit for our listeners.
Back in 1935, franklin DRoosevelt.
He's president.
He's looking for ways toincrease employees' rights.
He's looking for ways to helpthe common man get back on his
feet.
Congress passes the NationalLabor Relations Act and the
(03:44):
enforcement arm is the NationalLabor Relations Board and
essentially what this act isdoing is it's helping private
sector employees collectivebargain, it's helping them, with
their establishment, maintaintrade unions and it's
(04:06):
essentially just trying to helpthe worker gain power against
the employer.
Now the board is there and asthis enforcement arm and as the
administrative tool to addressthe issues found in the act, do
I got this right?
John Balitis (04:27):
Yeah, no, you're absolutely right, and I think
what's interesting about the actand of course, like you said,
the board is there to design andcreate it, to enforce it Is
that the I think, generallyspeaking, people think of the
National Labor Relations Act asa federal law that governs
unionized workforces, and to alot larger extent it does.
(04:51):
Like you just mentioned, itgives workers the right to
organize, bargain, unionize andso on.
But the act also applies to allprivate sector employees,
whether they're unionized or not, in other respects which a lot
of businesses forget, and theone most important part of it
(05:12):
that I'm talking about is theright embedded in the act for
workers to communicate with oneanother about their wages, hours
and working conditions, even ifthose communications are highly
critical.
And if an employer violates, orallegedly violates, any of
these parts of the act, tries tochill workers' rights to
(05:34):
unionize, organize, bargain, ortries to chill their
communications among one another, that then results in an unfair
labor practice charge whichthen goes before the board to be
adjudicated, and then that'show the board and the act sort
of work together to make up thewhole picture.
Bob Sewell (05:54):
So what is it about the board that's changed?
John Balitis (06:00):
Nothing about the board has changed.
It's the same structure that wehad when it was created back in
the 30s.
I just think what we have nowis, even though we have a
Democrat in the White House,which accounts for a swing back
toward an effort to enhanceworker rights, the Supreme Court
(06:22):
in its current way, it way it'scomposed, was populated by a
Republican, and I thinkRepublicans are, generally
speaking, historically known forwanting to enhance employer
rights.
Business rights changed.
(06:49):
I think the lobby forbusinesses and employers sees an
opening to try and convince thecourt to change its view on
whether the board itself isconstitutional, because we have
a court populated largely byRepublican justices right now
that probably would be keen totaking that up right now.
That probably would be keen totaking that up.
(07:09):
But we can get into it.
It's the structure of the boardthat makes it so unusual, that
makes it susceptible to thesechallenges.
Bob Sewell (07:14):
Tell me about that.
John Balitis (07:17):
Well, you know, the board at the risk of
oversimplifying it is not reallya good place to be.
If you're an employer, you knowif you're facing one of these
unfair labor practice chargesbrought by a worker or a group
of workers, and the reason isthat you have prosecutors,
(07:37):
judges and an appellatestructure all under one roof.
That's what's so unusual aboutthis body structure all under
one roof.
That's what's so unusual aboutthis body.
So when you're embroiled as arepresentative for an employer
at the board, you kind of feellike the deck is stacked against
you because all of thosefunctions are all under a single
(07:58):
umbrella at the board.
And so what that translatesinto from a constitutional
standpoint is you've got aprosecutorial arm, which is
generally thought of as anexecutive function, you've got a
judicial arm, which are theadministrative law judges and
the appellate structure withinthe board.
(08:19):
And then keep in mind that theboard also makes policy and
engages in rulemaking, which isfundamentally a legislative
process.
And so you look at thisstructure, you know, sort of
like in a simple way, and it'skind of like how can all this
coexist in one place?
Because all of this, accordingto the Constitution, is supposed
(08:40):
to be separate.
So that, I think, is theprimary structural challenge to
the board's composition.
There are other constitutionalarguments that are being made
about it, but from a structuralstandpoint that's really what's
going on.
Bob Sewell (08:55):
Yeah, that's odd, not odd, but it's interesting
that that's the way the board isset up and you could see why.
You know well, the traditionalwisdom is that when we have a
Republican, pro-employer personin charge, a president in charge
, and that the board is morefriendly toward employers, and
(09:21):
when we have a Democrat incharge, and that's a Labor
Democrat, generally consideredto be less friendly towards the
employers.
And you could see that would betrue because you're getting all
of these functions under thesame roof.
Have I got this right?
John Balitis (09:41):
Yeah, yeah, yes, you do, but the thing that's
going on now is no one's goingto the board and saying we would
like you to declare yourselfunconstitutional.
What's happening is SpaceX,starbucks, trader Joe's, amazon
they're all filing lawsuits infederal court, hoping to get up
(10:02):
to the Supreme Court, andthey're making arguments about,
for example, separation ofpowers, which is just what we
just discussed, and they'retaking the position that the
board as a body should no longerexist because it violates
fundamental constitutionalprinciples.
And although we have a Democratin the White House, which is
probably loathing this effort,who is loathing this effort?
(10:26):
We have a court, though, thatis a majority conservative bent
now, which is pro-business, andthe thinking is that if we
approach the court with theconstitutional challenges in
2024 that were first made in the1930s, we may actually have a
run at getting the court toreverse itself and maybe not
(10:49):
dissolving the board, butdismantling pieces of it, and
that's what's going on right now.
I think the employers and theirattorneys are seeing this as an
era where there's an openingbecause of the political
affiliation of the justices onthe court is an opening because
of the political affiliation ofthe justices on the court, and
if they can do that, thenCongress would have to step in.
Bob Sewell (11:11):
They'd have to reorganize the board and
introduce legislation, and in aCongress that is paralyzed it's
not likely to change much, orrather it's not likely to get
going in reorganizing the board.
Is that what they're thinking?
John Balitis (11:29):
Yeah, I think you're hitting the nail on the
head because, frankly, I mean itwould be a mess, you know, if
the challenges succeeded even inpart.
And, like I said, I don't seethis being sort of like an all
nothing proposition, becausewe've got arguments about the
fact that we've got SeventhAmendment arguments, we've got
(11:50):
Article III arguments, we've gotthe separation of powers
argument.
So there's a number and I thinkthis is deliberate.
Let's try as many arguments aswe can make this is from the
standpoint of the employers tosee what we might accomplish
here.
And if you just took one ofthose and convinced the court,
(12:12):
yeah, this creates a problem.
So we're going to have to carvethis out of the board structure
, we're going to have todismantle this aspect of the
board.
It would really be chaotic.
And so I think the, theemployers are thinking you know,
no matter how much of this wecan succeed on, it's going to be
good for business.
Right, and that's the approach.
(12:34):
I think that's the thinking.
Bob Sewell (12:56):
One of the things that bothers the average
American is we want to thinkthat the law is well settled,
that you could point to the lawand one court say no, that's not
constitutional.
Another court that says it'sconstitutional.
How do you respond to that?
John Balitis (13:14):
That's the way it is.
I mean, you could look at it asjust a feature, or maybe as a
vulnerability, of what otherwiseis an extraordinary
constitutionally basedgovernment.
Because you know, people cantalk about the executive branch
and the legislature and all that.
I've always thought and maybeit's because of just my
(13:37):
background in law like yours,that I think the Supreme Court,
those nine people, are probablymore powerful than just about
anybody else, and what you justdescribed is the reality,
because you can.
Roe v Wade is a perfect exampleof it and, like the average
citizen sitting back going, Iwish I could have some permanent
(13:57):
stability in the way laws areinterpreted and enforced.
It just can't happen because wehave two primary political
parties with 180 degreedifferent beliefs about
fundamental issues reproductiverights, gun control, capital
punishment and so on and thefact is that when you put
(14:17):
justices on the Supreme Courtthat are members or affiliates
of one party or the other, thatcan color how decisions are made
right, and that's just.
It's ingrained in our system Idon't know how you'd ever get
away with it, or get away fromit.
Bob Sewell (14:34):
I should say yeah, I've had constitutional law
experts on, we've discussed thisissue and the response is
always well, that's theConstitution.
And just because we believe wehave it right on day one doesn't
mean we have to believe we haveit right on day two and we
could be and should be a dynamicsociety.
(14:56):
And essentially that's theargument.
And if we don't like it, whatthe justices?
John Balitis (15:13):
did.
We can just go back and changethe Constitution or get new
legislation and try new thingsthat may work.
Yeah, I mean that's the escapevalve.
I mean if you don't like whatthe court did, then just muster
it up and then pass somelegislation and then undo the
court.
You know the court's decisionright, but it's also a function.
You know it's not just purelypolitical right, because there
are really two schools ofthought.
When you talk about if you'vehad the constitutional people on
(15:36):
, you probably know this.
I mean, there are some judicialofficers who look at the
constitution and say you have toread this and interpret it and
apply it as a living document,because when it was created no
one could foresee what'shappening today in hundreds of
different ways in modernAmerican society.
(15:57):
Then there are other judicialofficers who say, no, they are
strict constructionists.
You have to read this thing theway it's written and you can't
look at it like a livingdocument.
So you have these two competingjudicial views of how to
interpret the Constitution andthen overlay that with politics,
(16:17):
and it's a kind of a complexproposition, which is why you
see what's happening happening.
Bob Sewell (16:26):
Now I want to get back to the constitutional
issues within the National LaborRelations Board, and if big
employers are successful indismantling portions of the
board or causing the board to,or causing Congress to go back
(16:47):
and redraft, is that bad forlabor?
John Balitis (16:57):
No, it's not bad for labor.
If by labor you mean managementbusiness employers, it's not
bad at all.
Bob Sewell (17:04):
Is it bad?
I guess it's bad for theemployee.
John Balitis (17:08):
Well, I think the answer to that probably is yes,
because the board is a very,very employee-friendly place, at
least in my.
I mean, I can't speak foreveryone, right, but we talked
about how it's unusual to haveprosecutors, judges and an
appellate structure all in oneplace.
You walk in there as anemployee, you're feeling pretty
(17:30):
confident, you walk in there asthe employer and, like I said
before, you get the sense thatthe deck is stacked against you
before you start.
So if parts of the board weredismantled, I think it would
dilute the I won't say it's abias, but it would dilute the
(17:53):
level of comfort I think thatemployees would have in using
that agency to enforce theirrights, because right now it's
kind of like a perfect storm offunctions that all I think are
very helpful to workers.
And I mean, I'm not speaking,like I said, I can't speak for
everyone else, but I thinkthat's pretty commonly thought,
(18:16):
right.
Bob Sewell (18:18):
Yeah, yeah, I mean, you know.
I mean if you've ever been anemployer, been on, you know an
attorney for an employer, whichyou have.
I'm certain a lot of employershave found themselves in the
crosshairs of the boardinadvertently.
(18:42):
Oh yeah, that happens all thetime.
You know, I have family membersthat work for big corporations
and their middle management isconstantly violating the act and
they're like don't go anyonewhat we're you know.
Don't go out and tell anyonewhat we're paying you now, you
(19:03):
know, labor worker, because wedon't want this to get out right
.
Well, that's not going to gowell with the board, so I could
see this.
John Balitis (19:16):
That's an understatement board.
Bob Sewell (19:22):
So I could see this.
That's an understatement.
I could see this as an employerperspective the frustration
that when you find yourselfbefore the board, you find
yourself being disciplined, youfind yourself paying out or
something to this effect.
And you weren't trying to be anevil employer, you're trying to
be a good employer.
You tried to be a good employer.
Am I getting this right?
Have you seen this happen?
John Balitis (19:43):
Yeah, you're getting it right because you
walk in, like you know,figuratively speaking, and it's
like the person who'sinvestigating the charge against
you and who's going toprosecute it, the prosecutor's
there and who's going toprosecute it?
The prosecutor's there andyou're already in trouble
because otherwise you wouldn'tbe talking to the prosecutor,
because the prosecutor's sittingdown and saying, okay, let's
(20:07):
develop a trial schedule Becauseyou go to trial.
You basically go there and it'slike a trial and in front of an
administrative law judge, andthen so this person, who's the
investigator, the prosecutor,who's a lawyer, is going to
prosecute you and then you go infor your trial and the
administrative law judge is apart of the same agency where
(20:31):
the prosecutor works.
And then you get a result andyou want to appeal it and then
the appellate structure, theboard, is under the same roof as
the prosecutor and theadministrative law judge.
So how are you going to feel asthe employer walking into that
scenario, hypothetical you gaveabout don't tell anybody about
(20:59):
what we're paying you.
That that's like a perfect.
That's one great example of howan employer could trip up and
find themselves with a with acharge, uh, going to trial
because the the act says you,you non-supervisory staff
personnel, workers have theright to talk about wages, hours
and working conditions.
You can't.
You can't tell have the rightto talk about wages, hours and
(21:21):
working conditions.
You can't tell grassrootsworkers not to talk about their
comp.
That's not lawful under the act.
One other area that we saw thisunwitting violation of the act
and tons of employers gettingcharges filed and being brought
up before the board was whensocial media whatever 10, 15
years ago, you know became sopopular that people were really
starting to use it.
(21:41):
The engine, the social mediaengine, was gearing up and
workers were online on Facebookand you know, instagram didn't
exist back then but whateverplatform they were on grousing
and complaining about conditionsat work and in really critical
ways, like calling theirsupervisors profane names and
things of that nature, and theemployers were just getting
(22:03):
incensed by this and just firingpeople.
And none of the employersreally gave thought to the fact
that social media was just adifferent way, a different
platform to communicate.
You can talk face to face, youcan talk over the phone, you
could email and text or youcould be on a social media
platform complaining, but theemployers were so frustrated by
(22:26):
this chatter online that wascritical of them that they sort
of lost sight of what the actrequired or prohibited and there
was a time when we were tellingclients you have to look past
this.
You know you can't disciplinesomebody for complaining about
their job on social media.
(22:47):
And it was another great, greatexample of employers sort of
walking into the buzzsaw and noteven realizing it.
Bob Sewell (22:55):
Oh, yeah, well, and I understand the frustration
from the employer perspective,right, I mean, there's websites
dedicated, dedicated to being a,a, you know, to criticizing
your employment, your employerand or praising them, which
(23:19):
which is less likely to happen,but criticizing and describing
what it's like to work there.
I think a glass door is one ofthem.
But part of me also says, hey,but from the labor perspective,
isn't that a good thing that weshould be able to go out and
(23:39):
talk about our employers andtalk about the conditions of
work?
And this makes the employermore sensitive, because they
have to compete with otheremployers in the same field for
better conditions, bettertreatment.
John Balitis (24:04):
I think, like in a vacuum.
What you just said is a goodobservation and is accurate,
just like if you just took whatyou said and just assessed it
the way you said it.
Here's the problem Despite thebenefits that you have for sort
of having this transparentsystem where people can complain
and then it creates competitionand it creates reasons for
(24:28):
employers to improve, there arecollateral benefits to it.
I think what the employersargue about is where the board
draws the line.
What the employers argue aboutis where the board draws the
line, and what I mean by that ishow profane and critical and
angry can that communication getbefore it loses its protection
(24:49):
under the act?
Because what you said makesperfect sense In an ideal world.
If it was just like oh you know, kind of like a suggestion box,
I think it would be better ifwe, you know, had Starbucks
coffee in the lounge, notgeneric coffee.
Yeah, me too.
I think that coffee is horrible.
Okay, well, you know whatever.
But when you start saying, whenyou start calling your
(25:11):
supervisor names, and when itgets to that point, I think
employers generally look at itand say why is this protected?
And the response from the boardhistorically has been this is
where we're going to draw theline.
If there's a threat of violenceor commentary or remarks in
that communication that wouldpotentially cause harm to
(25:35):
somebody, that's where we willsay the communication loses its
protection.
So you can call your supervisora profane name and criticize
him or her all day long, but ifyou say I think we should go
over to the supervisor's houseand do something, then you've
stepped as the employeecommunicating you've stepped
(25:55):
over the line and I think mostemployers would argue that line
is way too far to one side.
You know, we should pull theline more toward the center and
not allow a lot of thisprofanity and criticism to go on
, because it isn't entirelyconstructive, it's disruptive,
(26:16):
right.
Bob Sewell (26:18):
Now with regard to the structure of the board.
When we have the rulemaking,the enforcement, the police
function right all under oneroof, that's incredibly
efficient.
John Balitis (26:57):
Right and people don't have to walk down the
street or across town to getfrom the prosecutor to the judge
or the appellate body.
Really efficient.
We're all here, we're all inone place.
But on the other hand, itcreates well.
Employers perceive that itcreates problems because the
(27:21):
employers perceive that itcreates a bias and, what's more
important, efficiency.
Or having a truly neutralagency, like if you take the
Equal Employment OpportunityCommission, another federal
agency that was created toinvestigate, that was created to
investigate, not always enforce, but investigate
(27:44):
anti-discrimination laws.
Right, it's not like that overthere.
They investigate charges, theyrender findings and then if
someone, if the worker, isdissatisfied with the finding or
wants to take it a step further, they go down the street to the
(28:04):
courthouse and file a lawsuitin federal court.
Completely separate.
The judicial enforcementmechanism for those laws and the
agency that investigates thealleged violations are
completely separated.
Bob Sewell (28:20):
But that's not how the board operates violations
are completely separated, butthat's not how the board
operates.
So what do you think?
Do you think if you were abetting man and you had to go to
Vegas and you had to make adecision, you got a thousand
bucks?
You must lay a wager.
Are we going to find thatportions of the board are
(28:42):
unconstitutional, and whichportions do you think you'd be
most likely to bet areunconstitutional or
constitutional?
John Balitis (29:02):
choice of the matter, I got to put a wager
down.
I'm going to say, because ofthe current composition of the
court and seeing what happenedwith Roe v Wade, that I think
it's likely that somethingemployer-friendly is going to
come out of this, meaning, ifyou want to translate, that
there's going to be a tweak oran adjustment to the structure
of the board.
That would be my.
It's just a prediction and it'skind of a tough call when you
confront me with a question likethat, but if you want me to
(29:23):
predict, I'll say you know, onbalance, yeah, I think
something's going to happen Interms of which one of these
could potentially fly.
I mean, we've talked about theseparation of powers, but we
haven't talked about the SeventhAmendment issue, which is, you
know, a lot of remedies, yeah, alot of the remedies the board
(29:45):
has.
The other thing about the boardis that it has extraordinary
remedy power.
I mean it has, it has the this,this stunning remedy power that
even federal district courtjudges don't have in terms of
what it can do.
You know it.
Just, it can force employers tohire workers back, do it can
force employers to hire workersback.
(30:06):
It can force employers to postthings on their walls, eliminate
policies, create policies,change policies.
It's extraordinary.
And the constitutionalchallengers are saying now, in
today's world, why aren't theseclaims and remedies being heard
and decided in the jury trialprocess?
These really are claims thatthe Constitution guarantees the
(30:31):
litigants or parties, if youwill a right to trial by jury,
and right now they're gettingdecided by administrative law
judges.
So there is something that Ithink is pretty catchy, right.
And then the other.
Then you have the Article IIIargument, which is all these
administrative law judges getappointed.
Okay, that's fine, but theysidestep the Article III process
(30:55):
entirely.
There's no nominationconfirmation process, senate
hearings, votes, right, nothing.
They're federal judicialofficers.
No, they're federal judicialofficers that get appointed and
then they're there.
And so what happens to Article3?
Why aren't these federaljudicial officers subject to the
(31:17):
Article 3 process?
So these the separation ofpowers argument is kind of like
a.
I think there's a ton ofvalidity to it.
The reason I think thatprobably isn't going to be the
one that gets the box ticked offis because that's the one that
could theoretically dismantlethe whole operation.
(31:39):
I think it's more likely thatyou're going to see something
like a Seventh Amendmentargument succeed or an Article
III argument succeed, whichwould not be nearly as
disruptive as succeeding on theseparation of powers argument.
So long answer to a shortquestion, but that's kind of
where I come out.
Bob Sewell (31:58):
And the Seventh Amendment argument would.
It would be that I have a rightto a jury trial.
Of course I have a right to ajury trial that you're deciding
my, you're deciding my, my fate,and it's it's a matter of $20.
Right, I mean, I could see that.
In which case would we have aadministrative law judge
(32:20):
presiding over a jury trial,have an administrative law judge
presiding over?
John Balitis (32:23):
a jury trial.
Well, I guess that's the wayyou could tweak it.
You could tweak it that way andyou could say okay, well, we
won't remove the ALJs, They'llstill be there, but we're going
(32:43):
to impanel juries for a certainnumber of or certain types of
claims that come up throughthese charges.
Or you could just extract allthose administrative law judges
from the whole agency and sayyou know, we can have the board
itself and the prosecutors there, but the charges now are going
to get litigated to federalcourt in front of an Article 3
judge.
You know, there could be, andall I'm saying is that there are
multiple, probably, solutionsto address the issue the Article
(33:04):
3 issue if it passes somemuster with the court.
A lot of times we talk in lawand with developments like this
sort of metaphorically, andthere's a lot of real world
stuff going on here Now.
(33:30):
When President Biden won theelection and we put a Democrat
in the White House, we weretelling clients at the time,
back in 2020, you're going tosee a huge shift in policymaking
and you had a nice four yearsunder the Trump administration
with employer friendlyrulemaking and legislation and
decisions and so on.
It's going to shift.
It might take a couple fewyears to shift, because you
can't change these thingsovernight, but you're going to
see a shift right, and so whatwe're talking about today is a
(33:55):
court that was populated by aRepublican, so you have efforts
to really exploit the Republicanaspect of the court, but in the
current administration, it'sgoing in exactly the opposite
direction.
So this Tuesday, the FederalTrade Commission voted to outlaw
non-compete agreements.
Bob Sewell (34:17):
Yeah.
John Balitis (34:18):
It's just extraordinary.
On Tuesday, the Department ofLabor announced that the salary
threshold for exempt workers isgoing up, so millions of workers
are now going to be entitled toreceive overtime if they don't
meet the salary thresholdrequirement for an exemption
(34:38):
from overtime right.
The board, in 2023, decided toprohibit non-disparagement
provisions and confidentialityprovisions in severance
agreements with workers.
So all of these things are theproduct of political changes and
(35:00):
political biases in the system,and nothing is nothing sort of
is a clear example of thishappening than when you take the
National Labor Relations Board,when you look at one of the
first things that Joe Biden didafter he was inaugurated that
day is he fired Peter Robb, whowas the Trump-appointed general
(35:25):
counsel of the National LaborRelations Board, and he
appointed Jennifer Abruzzo,who's now the general counsel of
the National Labor RelationsBoard.
It's one of the first things hedid after he was sworn in, and
it is a real-time, real-lifeexample of just how pronounced
politics is in terms of howrights the rights of workers and
(35:52):
employers alike are affected bythese developments.
And so that goes beyond thediscussion today.
It goes beyond a discussionjust about the board, but it's
all part of this whole tapestryof what's going on with politics
and the Supreme Court.
It's really interesting, butit's not just a theoretical talk
(36:15):
, it's reality.
Bob Sewell (36:16):
I guess is what I'm saying oh yeah, absolutely, and
people forget that theadministrative side of the
government you know, somethingthat came about primarily during
the great depression era, wherewe started to see the rise of
(36:39):
the administrative state has ahuge effect on our lives and we
haven't explored those issuessince the Great Depression and
whether or not theadministrative state should
(36:59):
stick around.
And during the Great Depressionthere was all sorts of
challenges where we said, hey,you have these wings of the
government that are creatinglaws that aren't the bodies that
we asked to create laws.
We didn't ask, we didn't electanyone at the National Labor
Relations Board.
John Balitis (37:19):
Exactly.
Bob Sewell (37:21):
We elected, you know , joe Schmoe Senator, joe Schmoe
, house of Representativesperson and so it seems we're
approaching 100 years of theadministrative law, the rise of
(37:41):
the administrative sector.
Yeah, I think it's time torelook at these issues and for
America to consider them oncemore.
And the fact that you have aSupreme Court that's willing to
do it.
It's an interesting fact and Ithink it's being overlooked by
mainstream media.
I think it's because mostpeople don't understand the
(38:05):
administrative state.
So, john, yeah, I think that'sa great point, go ahead this has
been incredible.
John Balitis (38:13):
What I was going to say is yeah, just to cap off
on that, I sent around a clientalert on Wednesday about the
FTC's decision aboutnon-competes and the caveat in
the alert was this is going toget challenged in multiple
lawsuits and people are going tobe making the argument that you
(38:34):
just made, which is the FTC isnot the body that legislates for
us.
It's an administrative agencyand you can't let the FTC or
other administrative agenciescreate and enforce the
equivalent of laws.
And that's your point.
I think it's a great point andI think it's going to start
(38:55):
getting a lot more attention.
Bob Sewell (39:03):
Oh right, the these you know you could from a very
that, that that alert you sentout, or regarded the, the and
non-compete clauses in contractswith employers and employees,
the.
From a very Lawyerlyperspective, this was something
that we primarily dealt with ata state level, and every state
(39:26):
had the right to make theirpolicy on non-competes.
And now we have the federalgovernment stepping in and
basically just wiping out ourstate laws and saying, well, we
think this is the best way, ourstate laws and saying, well, we
think this is the best way.
And instead of being able tocompete state to state for
(39:48):
employers, arizona is alwaystrying to say we are the best
state, come, bring yourbusinesses here and make our
population your workforce.
You know we now have thefederal government stepping in
on a really significant piece oflegislation and not even anyone
(40:10):
we elected.
Right, you're absolutely right,john.
Thank you for coming on.
It's been incredible having you.
You're very well versed inemployment law and labor
relations, and it's it's reallygood to talk to someone and hear
what they have to say.
So thank you.
Thanks for listening to thepodcast.
Is that Even Legal is nowlistened to in 100 countries and
(40:34):
available on virtually allpodcast platforms.
Leave us a review, send us someshow ideas and do so at
producer at evenlegalcom.
Don't forget, as smart as wesound and as lovable as we are,
we are not your lawyers and weare not giving you legal advice.
But if you need some legaladvice, get some.
(40:56):
There are some great lawyersout there and we are always
ready to help.
See you next time.
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