Secondary Activity Under the NLRA: An Overview for Construction Unions

There Are Important Sections of the NLRA to Know, This is One of Them

Introduction

The National Labor Relations Act (NLRA) of 1935, also known as the Wagner Act, is a cornerstone of U.S. labor law, governing the rights and obligations of employers, employees, and labor organizations in the private sector. For construction unions, understanding the nuances of secondary activity under the NLRA is critical to navigating labor disputes effectively while avoiding legal pitfalls. Secondary activity—actions directed at neutral third parties to pressure an employer with whom a union has a dispute—can be a powerful tactic but is heavily regulated under the NLRA. This article provides a detailed and exhaustive exploration of secondary activity under the NLRA, focusing on what constitutes illegal and permissible conduct, potential penalties and liabilities, other applicable laws, and strategies to avoid crossing into illegal territory, all from the perspective of construction unions.

Understanding Secondary Activity

Secondary activity occurs when a union directs its actions (e.g., picketing, strikes, or boycotts) not at the primary employer with whom it has a labor dispute (the "primary employer") but at a neutral third party (the "secondary employer") to pressure the primary employer indirectly. In the construction industry, this often involves interactions with contractors, subcontractors, suppliers, or other entities working on a job site where the primary employer operates.

The NLRA, specifically Section 8(b)(4), regulates secondary activity to balance unions' rights to engage in concerted activities (protected under Section 7) with the rights of neutral employers to avoid being entangled in labor disputes that do not directly involve them. The key distinction lies in the union's intent and the nature of the activity: actions aimed at pressuring the primary employer directly are generally permissible (primary activity), while actions targeting neutral parties to coerce them into influencing the primary employer are often illegal (secondary activity).

Primary vs. Secondary Activity

• Primary Activity: This involves direct action against the primary employer, such as picketing at the primary employer's job site to protest unfair labor practices or to negotiate better terms in a collective bargaining agreement. Primary activity is generally protected under Section 7 of the NLRA, which grants employees the right to engage in concerted activities for mutual aid or protection.

• Secondary Activity: This involves pressuring a neutral employer or entity to cease doing business with the primary employer or to otherwise influence the primary employer's actions. For example, a construction union picketing a general contractor (a neutral employer) to stop working with a non-union subcontractor (the primary employer) would typically be considered secondary activity.

The distinction hinges on the union's objective. If the goal is to pressure the neutral employer to alter its business relationship with the primary employer, the activity is likely secondary and subject to scrutiny under the NLRA.

Illegal Secondary Activity Under the NLRA

Section 8(b)(4) of the NLRA prohibits unions from engaging in certain secondary activities that have an unlawful objective or use coercive means. Specifically, it prohibits unions from inducing or encouraging employees of a neutral employer to strike or refuse to perform services, or from threatening, coercing, or restraining a neutral employer, with the object of:

1. Forcing a neutral employer to cease doing business with the primary employer (Section 8(b)(4)(i) and (ii)(B)).

2. Forcing any person to join a union or enter into a collective bargaining agreement (Section 8(b)(4)(ii)(A)).

3. Forcing an employer to recognize or bargain with a union that has not been certified by the National Labor Relations Board (NLRB) (Section 8(b)(4)(ii)(C)).

4. Forcing an employer to assign work to one union over another unless permitted by specific NLRB procedures (Section 8(b)(4)(ii)(D)).

Examples of Illegal Secondary Activity in Construction

In the construction industry, secondary activity often arises at multi-employer job sites where union and non-union contractors work side by side. The following are examples of activities that the NLRB has deemed illegal secondary activity:

• Picketing a Neutral Employer: A union pickets a general contractor’s job site to pressure the contractor to stop hiring a non-union subcontractor. If the picketing induces employees of the general contractor (a neutral employer) to stop work, it violates Section 8(b)(4)(i)(B).

• Threatening a Neutral Employer: A union threatens to picket a supplier delivering materials to a job site unless the supplier stops providing materials to a non-union contractor. This violates Section 8(b)(4)(ii)(B).

• Handbilling with Coercive Intent: While handbilling is generally protected (see below), distributing handbills at a neutral employer’s premises with the intent to induce a work stoppage or coerce the neutral employer to cease doing business with the primary employer can be unlawful.

• Secondary Boycotts: A union encourages workers at a neutral employer’s facility (e.g., a concrete supplier) to strike in order to disrupt the primary employer’s operations, violating Section 8(b)(4)(i)(B).

The "Ally Doctrine" Exception

The NLRB recognizes an exception to secondary activity rules under the "ally doctrine." If a neutral employer is deemed an "ally" of the primary employer—meaning they are so closely integrated that they are not truly neutral—the union’s actions against the neutral employer may be treated as primary activity. In construction, this might apply if a neutral contractor and the primary employer share management, facilities, or operational control, such that they function as a single entity. Courts and the NLRB assess factors like common ownership, control, or whether the neutral employer performs "struck work" (work that would have been done by the primary employer’s striking workers).

The "Common Situs" Problem in Construction

Construction sites often involve multiple employers (e.g., general contractors, subcontractors, and suppliers), creating a "common situs" where primary and secondary activity can overlap. The NLRB applies specific rules, such as the Moore Dry Dock standards (from Sailors’ Union of the Pacific (Moore Dry Dock Co.), 92 NLRB 547 (1950)), to determine whether picketing at a common situs is lawful:

1. The picketing is strictly limited to times when the primary employer is present at the site.

2. The picketing is limited to places reasonably close to the primary employer’s operations.

3. The picketing clearly identifies the primary employer as the target of the dispute.

4. The picketing is not intended to induce employees of neutral employers to strike or to coerce neutral employers to cease doing business with the primary employer.

If these standards are not met, the picketing may be deemed an illegal secondary activity.

Permissible Secondary Activity

Not all secondary activity is unlawful. The NLRA permits certain actions, particularly those protected by the First Amendment or specific statutory provisions, as long as they do not involve coercion or unlawful objectives. Permissible activities include:

• Handbilling and Publicity: Under Section 8(b)(4)’s “publicity proviso,” unions may engage in handbilling, advertising, or other forms of publicity to inform the public that a primary employer is non-union or engages in unfair labor practices, as long as the activity does not induce a work stoppage by neutral employees. For example, a union may distribute handbills outside a retailer’s store urging customers not to buy products from a non-union manufacturer, provided the handbilling does not coerce the retailer or its employees to stop dealing with the manufacturer.

• Primary Picketing at a Common Situs: As noted above, picketing at a common situs is permissible if it adheres to the Moore Dry Dock standards and targets only the primary employer.

• Hot Cargo Agreements in Construction: Section 8(e) of the NLRA generally prohibits “hot cargo” agreements, where a union and employer agree that the employer will not handle goods or do business with a non-union entity. However, the construction industry has an exception under Section 8(e)’s “construction industry proviso.” This allows unions and employers to enter agreements prohibiting the employer from subcontracting work to non-union firms, provided the agreement is part of a collective bargaining relationship and relates to work performed at the job site. Such agreements must be carefully drafted to comply with the proviso’s limitations.

• Area Standards Picketing: Unions may picket to protest a primary employer’s failure to meet area standards (e.g., wages and benefits comparable to those in unionized firms in the region), as long as the picketing is directed at the primary employer and does not coerce neutral employers. For example, a union may picket a non-union subcontractor’s job site to inform the public that the subcontractor pays substandard wages, provided the picketing complies with Moore Dry Dock standards.

Penalties and Liabilities for Illegal Secondary Activity

Engaging in illegal secondary activity under the NLRA can result in significant legal and financial consequences for unions. The NLRB and courts have authority to impose remedies, and neutral employers may seek damages for losses caused by unlawful actions. Potential penalties and liabilities include:

1. NLRB Remedies

• Cease-and-Desist Orders: The NLRB may order the union to stop engaging in the unlawful secondary activity. Failure to comply can lead to contempt proceedings in federal court.

• Posting Notices: The union may be required to post notices at job sites or union halls informing members and employees that it will refrain from illegal secondary activity.

• Reinstatement and Back Pay: If the unlawful activity causes employees of a neutral employer to lose work (e.g., due to a coerced work stoppage), the NLRB may order the union to provide back pay or reinstate affected workers.

• Union Discipline: The NLRB may impose internal sanctions, such as requiring the union to revise its practices or policies to prevent future violations.

2. Civil Lawsuits and Damages

Under Section 303 of the Labor Management Relations Act (LMRA), neutral employers harmed by illegal secondary activity can sue the union in federal court for compensatory damages. These may include:

• Lost Profits: A neutral employer (e.g., a general contractor) may recover profits lost due to project delays or disruptions caused by the union’s actions.

• Additional Costs: Costs incurred to mitigate the effects of the secondary activity, such as hiring replacement workers or expediting deliveries, may be recoverable.

• Punitive Damages: While rare, courts may award punitive damages if the union’s conduct is deemed particularly egregious.

• Attorneys’ Fees and Costs: Neutral employers may recover legal fees and costs associated with pursuing a Section 303 lawsuit.

3. Criminal Penalties

In extreme cases, secondary activity involving violence, threats, or property damage may trigger criminal liability under federal or state laws. For example, picketing that involves physical intimidation or vandalism could lead to charges under statutes like the Hobbs Act (18 U.S.C. § 1951), which prohibits extortion affecting interstate commerce.

4. Reputational and Operational Impacts

Beyond legal penalties, illegal secondary activity can damage a union’s reputation, strain relationships with contractors and other unions, and lead to loss of bargaining leverage. In the construction industry, where relationships with general contractors and developers are critical, such actions can have long-term consequences for securing future work.

Other Applicable Laws

In addition to the NLRA, several other federal and state laws may apply to secondary activity in the construction industry, particularly when the activity involves coercive or disruptive tactics.

1. Labor Management Relations Act (LMRA)

• Section 303: As noted above, this provision allows neutral employers to sue unions for damages caused by illegal secondary activity. It is a key tool for neutral employers seeking redress outside the NLRB process.

• Section 301: This section allows employers to sue unions for breaches of collective bargaining agreements, which may intersect with secondary activity if a union violates a no-strike or no-picketing clause.

2. Racketeer Influenced and Corrupt Organizations Act (RICO)

If secondary activity involves a pattern of illegal conduct, such as extortion or threats, a union or its leaders could face civil or criminal liability under RICO (18 U.S.C. §§ 1961–1968). For example, repeated threats against neutral employers to cease doing business with a primary employer could be construed as a racketeering activity.

3. State Laws

• Tort Laws: Neutral employers may sue unions under state tort laws for interference with contractual relations, trespass, or property damage caused by secondary activity. For example, picketing that blocks access to a job site could lead to a tortious interference claim.

• Anti-Picketing Statutes: Some states have laws regulating picketing, particularly when it involves violence or public safety concerns. Construction unions must ensure compliance with these laws to avoid state-level penalties.

• Right-to-Work Laws: In states with right-to-work laws, certain secondary activities, such as pressuring employers to enter union agreements, may face additional restrictions.

4. Federal Anti-Trust Laws

Secondary boycotts that restrain trade or commerce may violate federal antitrust laws, such as the Sherman Act (15 U.S.C. §§ 1–7). While unions are generally exempt from antitrust liability for legitimate labor activities (under the Clayton Act and Norris-LaGuardia Act), secondary activity that goes beyond protected labor disputes and harms competition could trigger scrutiny.

5. Occupational Safety and Health Act (OSHA)

If secondary activity, such as picketing, creates unsafe conditions at a construction site (e.g., blocking access to safety equipment), it could lead to OSHA violations, particularly if the union’s actions contribute to workplace hazards.

Avoiding Illegal Secondary Activity

Construction unions can take proactive steps to ensure their actions remain within the bounds of the NLRA and other applicable laws. The following strategies can help avoid crossing the line into illegal secondary activity:

1. Clearly Identify the Primary Employer

When picketing or engaging in other activities at a common situs, ensure all signs, handbills, and communications explicitly name the primary employer as the target of the dispute. Avoid vague or ambiguous messaging that could be interpreted as targeting neutral employers.

2. Adhere to Moore Dry Dock Standards

For common situs picketing, strictly follow the Moore Dry Dock standards:

• Limit picketing to times when the primary employer is present.

• Confine picketing to areas near the primary employer’s operations.

• Use signs and materials that clearly identify the primary employer.

• Avoid actions that encourage neutral employees to stop work or coerce neutral employers to alter business relationships.

3. Use Non-Coercive Tactics

Focus on non-coercive methods, such as handbilling or public outreach, to inform the public about the dispute without inducing work stoppages or pressuring neutral employers. Ensure handbills comply with the publicity proviso by avoiding coercive language or intent.

4. Train Union Members and Organizers

Educate union members, organizers, and picket captains about the legal boundaries of secondary activity. Provide training on NLRA requirements, Moore Dry Dock standards, and the risks of coercive tactics. Clear guidelines can prevent unintentional violations.

5. Draft Compliant Hot Cargo Agreements

When negotiating hot cargo agreements under the construction industry proviso, ensure they are limited to subcontracting work at the job site and are part of a valid collective bargaining relationship. Consult legal counsel to draft agreements that comply with Section 8(e).

6. Avoid Threats or Intimidation

Steer clear of any actions that could be perceived as threatening or coercive, such as verbal threats, physical intimidation, or property damage. Even implied threats can lead to NLRB charges or civil lawsuits.

7. Consult Legal Counsel

Before engaging in any activity that could be construed as secondary, consult experienced labor counsel to review the planned actions. Legal advice can help identify potential risks and ensure compliance with the NLRA and other laws.

8. Document Intent

Maintain clear records of the union’s objectives and actions, such as meeting minutes or written communications, to demonstrate that the activity was aimed at the primary employer and not intended to coerce neutral parties.

9. Monitor Neutral Employer Relationships

Carefully assess whether a neutral employer might be considered an “ally” under the ally doctrine. If there is uncertainty, treat the employer as neutral to avoid legal challenges.

10. Stay Informed on NLRB Precedents

The NLRB’s interpretation of secondary activity evolves through case law. Stay updated on recent decisions and consult with legal counsel to understand how current precedents may affect planned actions.

Additional Considerations

1. First Amendment Protections

While the NLRA regulates coercive secondary activity, certain forms of expression, such as peaceful handbilling or public protests, may be protected by the First Amendment. However, these protections are not absolute, and courts will scrutinize whether the activity crosses into coercion or violates NLRA provisions. For example, in DeBartolo Corp. v. Florida Gulf Coast Building Trades Council (1988), the Supreme Court held that peaceful handbilling urging a consumer boycott was protected speech, but picketing with coercive intent would not be.

2. Jurisdictional Disputes

Secondary activity prohibitions under Section 8(b)(4)(D) often arise in jurisdictional disputes, where two unions claim the same work. Construction unions must follow NLRB procedures (e.g., a 10(k) hearing) to resolve such disputes rather than resorting to picketing or strikes against neutral employers.

3. Political and Community Advocacy

Unions may engage in political or community advocacy to pressure employers indirectly (e.g., lobbying for local ordinances favoring union labor). These activities are generally permissible unless they involve coercive tactics or violate specific laws.

4. Technology and Social Media

In the digital age, secondary activity can extend to online platforms. For example, a union’s social media campaign urging a boycott of a neutral employer’s services could be scrutinized as secondary activity if it has a coercive objective. Ensure that online communications comply with NLRA restrictions and focus on permissible publicity.

5. Interaction with Other Labor Laws

Construction unions must also consider how secondary activity intersects with other labor laws, such as the Davis-Bacon Act (prevailing wage requirements) or the Employee Retirement Income Security Act (ERISA) for benefit fund disputes. Actions that appear to be secondary but are tied to enforcing these laws may require careful legal analysis.

Conclusion

For construction unions, navigating the complexities of secondary activity under the NLRA requires a deep understanding of legal boundaries, strategic planning, and vigilance to avoid unlawful conduct. While the NLRA protects unions’ rights to engage in primary activity and certain forms of publicity, illegal secondary activity can lead to severe penalties, including NLRB remedies, civil lawsuits, and reputational harm. By adhering to Moore Dry Dock standards, using non-coercive tactics, and seeking legal guidance, unions can advocate effectively for their members while staying within the law. Additionally, awareness of other applicable laws, such as the LMRA, RICO, and state tort laws, is essential to avoid unintended liability. Through careful planning and education, construction unions can harness their collective power responsibly and effectively in the complex landscape of labor relations.