I’m the owner of a small record store. I have 13 sales clerks and 4 back room employees. Things aren’t great these days – but we get by. Fortunately, while people listen to music on their phones and the internet way more than they do CDs, we’ve refocused ourselves toward vintage record collectors and hardware sales.
I just fired a sales clerk last week for what I thought was pretty obviously unacceptable behavior. He started complaining to me the other day about the way I pay commissions. I pay my sales clerks $10 per hour plus a small commission on certain items in the store. For instance, if they move a record-player, or a set of headphones, or a tube amplifier, they get 2% of the sale in their next check. Because this guy worked on the day shifts, he felt like he did not have as good a shot at selling the big-ticket pieces of equipment, which are often sold in the evening. He pestered me for weeks to reduce the commissions on the hardware, and to give him a commission on the used records that he sells during the day in order to make it more “fair” for him. On Thursday we were working together for most of the day, and he would not stop bringing it up with me. I kept telling him that I preferred not to talk about things like that when customers were around, and that I would talk to him about it later. About ten minutes before his shift ended, he blew up, and in front of a half-dozen customers started shouting, “You f@&%ing jerk! You just want to keep all the big commissions for yourself! I should kick your a@@! Who f@&%ing puts up with this bull$#!t!” Then he threw a box of cds at me, which smashed into the front desk and scattered all over the place. The customers were freaked out. I was furious.
Obviously, I fired him on the spot. The next day, he sent me an email claiming he had been talking to some lawyers (aka doing Google searches), and that what I did was a violation of something called the NLRA. He claims that unless I write him a big check, he’s going to file a lawsuit with the National Labor Relations Board, and “knock your sorry a@$ out of business.”
What on earth is he talking about? There’s no union in my store – why is he talking about the “National Labor Relations Board?” Not to mention, the guy launched into a cuss-word laden tirade at me in front of a bunch of our customers. Surely I can fire him for that, can’t I?
Probably you can, yes. But the answer is more complicated than you think.
It sounds like this young man may have come across the latest entry on the expanding list of overreaching-NLRB-decisions-of-the-month: Plaza Auto Center, 28-CA-022256 (2014). In that case, the National Labor Relations Board (the “Board”) decided that a car dealership broke the law by firing a sales associate who dropped a number of f-bombs during a tirade about the dealerships wage and hour practices. The case is being trumpeted as the death of “insubordination” as a legitimate reason for termination. It’s not. And it’s important to understand why.
The Plaza Auto Center case had two parts, and both of them get at key aspects of the National Labor Relations Act’s (the “NLRA”) protection of employees from being terminated for engaging in “concerted activities” for their “mutual aid and protection.”
The first part involves determining whether the employee’s actions are protected “concerted activity,” and requires you to answer two questions.
The first is: “was the activity ‘concerted?’”
o Generally, this requires two or more employees acting together to improve wages or working conditions.
o The action of a single employee may be considered concerted if he or she involves co-workers before acting, or acts on behalf of others.
The next is “did the person take the action seeking to benefit other employees?”
o Will the improvements that the employee is asking for – higher pay, better hours, improved safety, lowered workload, etc. – benefit more than just the employee taking action?
o Or is the action more along the lines of a personal gripe, which is not protected?
If the answer to both of these questions is “yes,” then you are dealing with protected “concerted activity.” This rule extends to almost every employer in the country, including your business. It does not matter that your employees are not in a union. There are exceptions that I won’t get into here, but your baseline expectation should be that your employees are covered by this act, and are allowed to engage in conduct like this without facing discipline for it.
This first issue was not discussed at lengthin the iteration of the Plaza Auto Sales decision making headlines these days, because it was resolved in a preliminary decision years ago. In that older decision, the Board decided the employee engaged in clear concerted activity: gathering information and concerns from fellow employees about what they viewed as improper and potentially illegal pay practices, and discussing these issues with management on behalf of those other employees who were too nervous about keeping their own jobs to bring it up themselves.
Therefore, the recent Plaza Auto Sales decision dealt only with the second aspect of the “concerted activity” protection: Was the protected conduct carried out in a way that caused it to lose protection? Editorializing about the proclivities of the Obama Board aside, there technically are limits on the way employees may exercise their concerted activity rights. Employees who exercise their “concerted activity” rights in a violent, dangerous, deeply disruptive, or otherwise extremely inappropriate way waive their protection to which they would otherwise be entitled, and can be fired for it without penalty.
The test for determining whether employee conduct waives concerted activity protection is set forth in a case called Atlantic Steel, 245 NLRB 814, 816 (1979), and requires you to balance the following four factors:
(1) the place of the discussion;
(2) the subject matter of the discussion;
(3) the nature of the employee’s outburst; and
(4) whether the outburst was, in any way, provoked by an employer unfair labor practice.
In the Plaza Auto Sales case, the employee and his supervisors met in an office off the sales floor in order to speak with management about a group of employee’s issues with the way the company paid its salespeople. In that meeting, the employee swore at management a number of times and leveled some personal insults against his boss. He also said that the folks in the room would “regret” not listening to his concerns, and got up from his chair in a way that his boss found to be “menacing.”
The Board decided that three of the factors cut against the employer’s argument that the employee waived protection under the act. First, the Board decided that the first factor did not support waiver because the discussion took place off the sales floor, in a back room, and did not disrupt customers or other employees. The Board decided that the second factor cut against waiver as well, because the discussion focused exclusively on the wage-and-hour practices of the business, which are central issues protected by the NLRA.And, the Board decided that the last factor similarly supported the employee, because the employee’s angry reaction came in response to several statements by his employer that made it sound like they were threatening to fire him for engaging in concerted activity – itself an unfair labor practice.
The Board agreed that the third factor supported waiver, and said explicitly that obscenity and personal insults are inappropriate, but decided that factor alone did not outweigh the other three that supported leaving the protection in place.
Your situation is different from Plaza Auto Center in a number of ways. First, it looks like you may have an strong argument that your employee was not engaged in “concerted activity.” He never mentioned to you that he wanted his commissions to improve, but did not create the appearance in any way that he was acting on behalf of others. In fact, his request seemed particularly focused on making things more fair for him, to the exclusion of this other coworkers.
And, even if this was protected conduct, the way your recently-departed salesperson acted probably waived the protection of the NLRA. Your salesperson’s language was just as offensive as the language in Plaza Auto Center, and should receive the same level of disapproval from the Board. However, where the Plaza Auto Center employee blew his lid behind closed doors, your recently-departed salesperson did so on the customer floor in a very disruptive way. Where the Plaza Auto Center employee’s “threatening” behavior involved standing up in an aggressive manner, your employee’s decision to launch a heavy box of plastic across the room almost certainly crosses the line into threatening and dangerous behavior. And, while the employee in Plaza Auto Center was angered by the company’s unfair labor practices, the only thing your employee was reacting to was your preference on how to structure your commission program. It’s unlikely that any Board representative would view that as an unfair labor practice on its own.
At the end of the day, all the Plaza Auto Sales decision stands for is the principle that, when conveying other employees concerns about a company’s payroll practices, it is not a fire-able offense to swear at your boss. Employers should think twice about disciplining employees for the way they talk to the company about the company’s wage and hour practices. But the Board has not taken cussing and swearing in front of customers off the table as a legitimate reason for terminating a salesperson. At least not yet!