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ALJ: Dollar General threatened to close store if employees voted for a union

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Dive Brief:

  • Dollar General violated federal labor law when corporate officials threatened to close a Connecticut store if employees voted for a union, illegally surveilled their actions and fired a pro-union employee, an administrative judge for the National Labor Relations Board opined in Dolgen Corp. and United Food and Commercial Workers, Local 371.
  • Per the July 17 ruling, within days of the union filing a petition with the NLRB to represent store employees, four corporate officials — including the chief people officer and the senior director of labor relations — arrived at the store and stayed until the union election. One official allegedly told a worker she could become a store manager but warned that another store closed after employees voted for a union, according to the record. The officials also kept a running list of who favored union representation and fired an employee they allegedly believed was influencing others to support the union, administrative documents indicated. The NLRB’s general counsel charged the company with interfering with, restraining and coercing employees in the exercise of their rights under the National Labor Relations Act.
  • Following a hearing, the judge upheld the charges. “Respondent clearly violated Section 8(a)(1) in sending these individuals to Barkhamsted to observe union activity if it occurred or to inhibit employees from engaging in union activity,” he said. Their actions were part of a corporate-wide policy to deter employees from exercising their NLRA rights and constituted “blatant hallmark unfair labor practices,” the judge concluded. He ordered Dollar General to reinstate the fired employee and compensate him for any loss of earnings and other benefits. The company must also distribute an electronic notice of NLRA rights to all employees in the U.S., post a hard copy of NLRA rights at stores canvased by the union and abide by a broad cease-and-desist order.

Dive Insight:

Employees have the right under Section 7 of the NLRA to unionize, join together to advance their interests as employees and to refrain from such activity, according to an NLRB guidance.

Under the statute, an employer can protect its legal rights in certain ways, the guidance says. For example, it can ask the Board to review a regional director’s decision directing an election. It can also interview employees to prepare for a defense in an unfair labor practice case, under certain conditions.

However, under Section 8(a)(1), employers may not interfere with, restrain or coerce employees who exercise their Section 7 rights, the guidance points out. This includes responding to a union organizing drive by threatening to close the workplace, interrogating or spying on pro-union employees or promising benefits if employees forget about the union.

Shuttering workplaces has become a highly publicized tactic some companies are using to fend off union organizers. In March, an administrative law judge ruled that Starbucks’ attempts to thwart Buffalo-area employees from unionizing — including permanently closing one store — violated the NLRA.

Starbucks also violated Section 8(a) by hiring and temporarily transferring employees to stores with upcoming union votes to dilute union support, temporarily closing some stores and reducing the hours at other stores, the judge found. In an email to HR Dive after the ruling, a Starbucks spokesperson called the decision and remedies “inappropriate” and said the individuals cited in the ruling had been separated from the company.

Amid staffing and budgetary shortages, the NLRB is dealing with a record-breaking surge in union activity and unfair labor practice cases. During the first six months of FY 2023, for example, ULP charges increased 16%, from 8,275 in October 2022 to 9,592 as of March 31, the NLRB announced in April.

Union representation petitions increased 53% in FY 2022, the announcement said. During the first half of FY 2023, they rose 2%. Accounting for the increases in both union petitions and ULP complaints, the NLRB is on track to record the second-largest increase in filings since 1959, it said.

Meanwhile, Dollar General’s legal woes aren’t limited to defending against NLRA complaints. The discount retail giant also faces intensified scrutiny by the Occupational Safety and Health Administration for allowing the same types of safety violations to persist in stores for more than half a decade.

The violations typically relate to backroom storage and merchandise clutter that block aisles, fire extinguishers, emergency exits and electrical panels. 

In addition, the company has been assessed more than $21 million in penalties since 2017; Dollar General told Retail Dive it has paid $4 million. If a business refuses to pay fines, OSHA can file criminal charges against it, an expert said.

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