Heavy Duty Manufacturers Association Two Ways to Access CVOC Virtually CCJ Magazine live stream at wwwccjdigitalcom Twitter feed at CVOC12 Michael Reilly Chairman amp Chief Executive Officer ID: 636765
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Slide1Slide2
Timothy Kraus
President & Chief Operating Officer
Heavy Duty Manufacturers AssociationSlide3Slide4
Two Ways to Access CVOC Virtually
CCJ Magazine live stream at
www.ccjdigital.comTwitter feed at #CVOC12Slide5Slide6Slide7Slide8Slide9Slide10Slide11Slide12Slide13Slide14Slide15Slide16Slide17Slide18Slide19Slide20
Michael Reilly
Chairman
& Chief Executive OfficerRandall-Reilly Business Media & InformationSlide21Slide22
Jeff Mason
Senior Vice President, Trucking Group
Randall-Reilly Business Media & InformationSlide23Slide24
Dan England
Chairman, C.R. England Inc. &
Chairman,
American Trucking AssociationsSlide25Slide26
R. Eugene Goodson (Gene)
Alternative Energy Expert & Former CEO
Oshkosh Truck
CNG / LNG Panel Brief OverviewSlide27
Speakers & Panel Objectives
Dan England
, Chairman, C. R. England
Kennon
Guglielmo
,
President
,
EControls
Robert Carrick
,
Sales Manager
, CNG/LNG Freightliner
ObjectivesSlide28
Some Observations
Liquid petroleum products are still the preferred truck fuel
Where can NG be substituted for non-transport petroleum use now?Transportation prioritiesEmission standards still a challenge
NG fuels offer a cost advantage in certain applications
Use taxes
Crude oil and NG price relationship
Emission standards?Slide29
An Alternative Energy Experience
1977, Rifle, Colorado, Shale oil field
1 mile square trench 300 feet deep by 100 foot wideFracture shale by dynamite, 10% oil in structureHeat square mile by 300 foot structure to release oil at bottom
Refining process expensive – contaminants
Conclusion:
Mining, not usual oil extraction
Shale oil would never be feasible with this process!
Visit with GM peopleSlide30
Other Transportation Energy Sources
Ethanol
MethanolPropane
Coal liquids
ElectricitySlide31Slide32
Kennon Guglielmo, Ph.D.
President
EControls, LLC
Domestic Heavy-Duty Mobile Natural Gas
History, Technology, and OutlookSlide33
A Snapshot of EControls...
EControls Served OEM Applications:
Complete OEM fuel system provider...
Heavy-Duty On-Road
Industrial
Marine
Electronic Control Modules
Fuel Control
Actuators & SensorsSlide34
A Snapshot of EControls...
100,000+ OEM heavy-duty NG systems on the road today
Installed base of 1,000,000+ engine control systems
Engine development and emissions certification
Engine management systems for NG, LPG, Gasoline, Diesel
But for domestic HD NG... we have been
skeptics
for 15 years!Slide35
Early Domestic NG Struggles
Why have domestic HD NG engines failed to achieve critical mass over the last 2 decades ???
Lack of broad-based
refueling infrastructure
Limited space for long-range
fuel storage
High
cost of tankage
relative to diesel
Insufficient
sustained
relative
cost advantage
of NG to diesel
Proof of this assessment is the fact that
transit buses
and
waste trucks
are currently the only domestic HD NG success stories:
No need for broad-based refueling infrastructure
Plenty of room for tankage for all-day operation
Incremental cost of tankage a small percentage of total vehicle costSlide36
Fuel Cost Economics
Historical Oil & NG Fuel Prices
Oil
$/Barrel
Natural Gas
$/MCF
Oil Price in
$/Barrel
Natural Gas
Price in $/MCF
Domestic shale
production hits its strideSlide37
Fuel Cost Economics
Relative Energy Cost of Oil and Natural Gas
Oil /
NG
$/Btu Wellhead Cost Ratio
Sustainable > 2:1 ratio will
drive market build-out
Domestic shale
production hits its stride
Non-sustainable > 2:1 ratio
triggers 1990’s activity
< 2:1 ratio insufficient for critical massSlide38
Fuel Cost Economics
“We’ve heard it all before”...
“As soon as we commit, NG prices will go up”
“As soon as we commit, oil prices will drop”
Why things are different now
(in the last 4 years):
Domestic (and worldwide)
NG shale plays
Total NG game changer
New fracturing technology allows previously economically inconceivable access to NG
Current production capability massively outstrips demand
Future production will continue to outstrip demand
The U.S. has some of the world’s largest fields
Oil price
escalation is here to stay
Oil prices failed to even keep up with inflation in the 1990’s –
those days are over
China is driving worldwide oil consumption – and will continue to do soSlide39
Critical Fuel System Technologies
Vehicle fuel storage type
CNG = Compressed Natural GasLNG = Liquefied Natural Gas
Engine fuel delivery system
Air / Fuel pre-mix
Direct NG injection
Engine ignition system
Spark
Micro-pilot diesel
Standard diesel
Major Technology AreasSlide40
Vehicle Fuel Storage
CNG = Compressed Natural Gas
(3000+ psi gas)
≈ 5:1 tank dimensions for diesel range (at 3600 psi)
Lower tank price, but more tanks
Least expensive pump delivery price
User-friendly filling
Indefinite fuel storage
LNG = Liquefied Natural Gas
(cryogenic low-pressure liquid)
≈ 2.3:1 tank dimensions for diesel range
Higher tank price, but less tanks
More expensive than CNG at the pump
Filling requires training
Limited time after filling before tank vents (days to weeks)
since tank is essentially a large “thermos” bottleSlide41
Engine Fuel Delivery System
Air / Fuel Pre-Mix
(NG mixed into incoming air stream)Lowest cost and lowest complexity
Low fuel pressures at the engine (similar to gasoline)
Continuous flow possible = high valve durability
Requires throttling = reduced light-load efficiency
Domestic example: Cummins ISLG, ISX12G, ISX15G
Direct NG Injection
(NG delivered in-cylinder like diesel)
Higher cost and higher complexity
High fuel pressures at the engine (cryogenic pumps for LNG)
Must be pulsed injection = finite valve cycle life
No throttling required = increased light-load efficiency
Domestic example: Westport HD 15LSlide42
Engine Ignition System
Spark Ignition
(similar to gasoline engines)
Electronic spark initiates combustion
Lowest cost and lowest complexity
Current systems limited to ≈ 21 bar
bmep
(123
ft-lbs
/liter)
Micro-pilot diesel ignition
(very small common-rail injection)
Small diesel quantity initiates combustion
High cost and high complexity
Ignition system does not limit
bmep
Engine is not true “dual fuel” (i.e. cannot make >10% torque without NG)
Standard diesel ignition
(standard common-rail injection)
Diesel injector initiates combustion
Highest cost and highest complexity
Ignition system does not limit
bmep
– but does pose emissions challenges
Maximum of ≈ ¾ power from NG fuel (remainder from diesel)
True “dual fuel” (i.e. engine can run full power on diesel)Slide43
Truck Cost Considerations
Why are HD NG engines so much more expensive than diesel?
They should be the same or cheaper because...
Spark ignited, pre-mix NG fuel system ≈ diesel fuel system cost
Spark ignited NG engine aftertreatment is much cheaper than Tier4 diesel aftertreatment
But...
Low
volume production by
domestic
manufacturers = higher
cost
Extremely
limited domestic engine competition = higher
cost
Domestic market will currently bear a higher price because NG vehicle buying decisions are driven by fuel cost advantages – not engine cost
What does the fuel storage system cost?
Both CNG and LNG tanks are ≈ $100 / diesel gallon equivalent (DGE) in
high-volume
Mounting brackets and tank to engine plumbing are more expensive than diesel
Fuel heat exchangers usually required on LNG systems, may also be used with CNG
No SCR system required for leading technology spark-ignited systemsSlide44Slide45
Robert Carrick
Sales Manager
Natural Gas
Natural Gas Market and ProductsSlide46
What’s Driving Natural Gas?
Lower fuel costs and less price volatility
than diesel fuel – quick paybackProduction SolutionsDependable spark ignition engine technology
Simple after-treatment –
NO DPF, NO REGENS
No SCR required
Reduced GHG emissions, 20% average
Noise reduction – ten (10)
db
reduction
vs
diesel
Domestic fuel/energy security
AMERICAN jobs
Renewable fuel technology advances
Infrastructure is
finally
improving
CNG
LNG
Diesel
Diesel
CNG
MPG
6.0
5.4
Miles/Year
80,000
80,000
Fuel Price
$4.04
$1.8
0*
Gallons
/Year
13,333
14,815
Fuel
Costs/Yr
$53,867
$26,618
Annual Fuel Savings
Yrs
Payback @ $40,000 Premium
$27,249
1.47Slide47
Customer Success
Paper Transport (WI)
Swift (AZ)
Sysco (CA)
Suffolk County (NY)
Ryder (CA)
National Grid (NY)Slide48
Customer Success
J.B. Hunt (TX)
Frito Lay (CA)
City of Nashua (NH)
LA County (CA)
City of Santa Monica (CA)
Waste Management (TX)Slide49
Hurdles to Natural Gas Market Development
INFRASTRUCTURE – INFRASTRUCTURE – INFRASTRUCTURE
No longer “Chicken and Egg” discussionNow…Chicken and FEED!Limited power train options… NG is not for everyoneComprehensive training and product support
Facility requirements and improvements – NFPA 30A
Secondary Market – Where will we be in five years?Slide50
2013 & Beyond
2013 Full production units with
ISX12 G – 400HP / 1450 TorqueNAT GAS Act will pass
New engine platforms in development for 2015 – 15 liter and 7 liter
Diesel prices will skyrocket again
Continued infrastructure improvement
Natural gas will equal 20% by 2020Slide51Slide52
Dan England
Chairman, C.R. England Inc. &
Chairman,
American Trucking AssociationsSlide53
C.R. England LNG ImplementationSlide54
C.R. England Profile
Privately owned and operated since 1920
Currently in the third and fourth generation of leadership
Largest refrigerated carrier in the nation
Annual Revenue $1.2 billion (2012)
England North America
4,200+ trucks
6,500+ trailers
6,200 employees
England Logistics
Non-asset based subsidiary
Top 40 3PL and top 10 freight broker
Licensed international freight forwarderSlide55
C.R. England Service OfferingsSlide56
LNG Profile
Tractor Count: Five
daycab tractorsMake: Kenworth T800, Cummins / Westport 15L
Fuel Type: Liquefied Natural Gas (LNG) & Diesel (ULS)
Fuel Capacity:
LNG
: 70 diesel gallon equivalents (DGE) &
Diesel
: 45 gallons
Mileage Range: App. 350 miles on LNG
Application: Dedicated fleet
Implementation: October 2011
Miles Per Day: 500 miles per day per tractorSlide57
Additional Information
250-mile length of haul, looped freight$80,000 increase in tractor cost
Full-service lease arrangement$0.11 variable charge (maintenance / spare truck)Significant elevation change – reason for 15L engine
LNG fueling stations at both origin and destination
Southern California (Fleet Star) to Las Vegas (Clean Energy)Slide58
Fuel Results
FuelingSimilar timing to fueling a diesel truck
Face shield and gloves requiredLNG stations have less reliability
Fuel economy results
Miles: 235,750
LNG DGE: 36,044; Diesel Gallons: 4,205
MPG: 5.86Slide59
Maintenance Intervals – LNG vs Diesel
LNG
Diesel
Oil and Filter Change
25,000
50,000
Fuel Filter
25,000
50,000
Coolant Filter
25,000
50,000
Valve Adjustment
60,000
500,000
BIT Inspection
90 days
90 daysSlide60
Maintenance Results
MaintenanceSlower maintenance turnaround time than diesel
Engine-related parts availability has been challengingGreater need to stay in-serviceMaintenance results
19 engine-related breakdowns
Several sensor malfunctions and coolant hose issues
10 LNG fuel-related breakdowns
Fuel leaks and sensor malfunctions
Truck downtime
One truck has had the bulk (>50%) of engine and fuel issues
and has been OOS for two consecutive weeksSlide61
LNG Financial AnalysisSlide62
LNG vs
CNG
Varying perspectives on which is preferableMultiple factors influence the decisionFuel distribution / infrastructure
Application specifics
Length of haul
Weight and cube requirements
Cost of LNG, CNG, diesel
Technology advances could impact decisionSlide63
General Observations
Environment & fuel dependence drove decisionNatural gas is new and evolving
Each solution is uniqueOptimistic about 12L engineViability depends on fuel price variances
Existing fuel surcharge scales
Multiple parties are involved:
OEM, fuel provider, carrier, and shipper
Risk should be spread between all stakeholdersSlide64Slide65
Avery Vise
Executive Director, Trucking Research & Analysis
Randall-Reilly Business Media & InformationSlide66Slide67
R. Eddie Wayland
Partner
King & Ballow
Employment Law Potholes
in the Road AheadSlide68Slide69
Discrimination OverviewSlide70
Eleven Protected Categories Under Federal Discrimination Laws
Race
ColorSex
Pregnancy
Age (40 and over)
Religion
Disability
Veteran Status
National Origin
Citizenship
Genetic InformationSlide71
Protected Categories
In 2011, there were
99,947 charges filed with the EEOC, the highest number in the agency’s history. Thee EEOC recovered
$364.6 million
in monetary damages. The following categories were included in the indicated percentage of time:*
Statistics
Race – 35.9% (‘10: 35.9
%) Disability
– 25.8% (‘10: 25.2%)
Sex – 28.5% (‘10: 29.1
%) National
Origin – 11.8% (‘10: 11.3%)
Age – 23.5%( ’10: 23.3
%) Religion
– 4.2% (‘10: 3.8
%)
Retaliation
– 31.4% (‘10: 31.0%)
*
Individual charges can and often do include more than one form of discrimination and/or harassment. Slide72
Discrimination
Inconsistent application of policies;
Inadequate documentation of performance problems;
Reasons for discipline / termination are not believable;
Unfair treatment;
Abusive treatment;
Comments related to protected classes; and
Failing to respond to employee complaints/concerns.
Common Causes of Discrimination Claims:Slide73
Expanded Liability
Staub
v. Proctor Hospital (U.S. Sup. Ct. 2011)“Cat’s Paw”
Suit filed for anti-military status discrimination (USERRA)
Employee alleged supervisor’s hostility toward his military obligations influenced his termination
Supreme Court found employer liable for hostile actions of supervisors under USERRA,
even though VP of HR was unaware of hostility
Lower federal district and appellant courts have applied
Staub
in other contexts (Race / Sex / Age / Disability, etc.)
Take Away:
Properly train supervisors/managers
Conduct independent investigations
before
actingSlide74
Age Discrimination
Prohibits discrimination against employees age 40 or olderApplies to employers w/ 20 or more employees
2011 Statistics:EEOC recorded 23,465 charges of age discriminationTotal monetary benefit of $95.2 millionSlide75
Religion
EEOC Charges at
10-year high in 2011Protects not only people who belong to traditional, organized religions, but also others who have
sincerely held
religious, ethical or moral beliefs.
Title VII concerned with “ultimate ideas” about “life, purpose, and death.”
Social, political, or economic philosophies, as well as mere personal preferences, are not “religious” beliefs protected by Title VII.
Religious Issues:
Prayer at work
Efforts to convert at work
Religious items at work
Leaves of absence for religious reasons
Religious holiday or observance time-off
Religious dress / garmentsSlide76
Discrimination
HYPO: Eve works at a large trucking firm. After 10 years of employment, Eve has a glowing reputation. Eve has recently applied for the big promotion she has always wanted, and it looks as though she is going to get it. However, Eve believes she would be able to bring in more clients as a man in her new position. Not letting genetics keep her down, Eve goes ahead and begins presenting herself as a man in the workplace by legally changing her name to Steve, dressing in suits and ties and taking testosterone pills to make her features more manly. When Eve / Steve’s supervisor finds out about these changes, he tells him / her “the position has been filled.”
Gender Identity and Sex Stereotyping
Does
Eve / Steve
have a claim for
sex / gender
discrimination?Slide77
Discrimination
YES
Macy v. Holder (EEOC – April 20, 2012)Former male police detective
Applied for job as a Male
Sends email informing contractor of gender reassignment
Informed position was eliminated due to budget constraints 5 days later –
given to someone else
EEOC determined that Macy had a claim for discrimination based on sex
Gender Identity and Sex StereotypingSlide78
Criminal Background Checks
April 25, 2012:
EEOC says its unlawful for employers to have a policy or practice of excluding individuals from employment on the basis of conviction records, due to disparate impact on certain protected classesBans the “Yes or No” Box – almost
Defense = “business necessity”
New Factors
Nature and gravity of the offense(s)
Time that has passes since
Nature of the job held or soughtSlide79
Disability IssuesSlide80
Americans with Disabilities Act
Discrimination against qualified individuals with a disability and their associates is prohibited under the ADA.
Applicable to employers with 15 or more employeesImposes a duty to reasonably accommodate Mandates participation in the “interactive process”Slide81
Disability
Individual has a
physical or mental impairment which
substantially limits
one or more
major life activity
“Should not require extensive
analysis”
Includes conditions which are episodic or in remission
Certain conditions will virtually always qualify
Deafness, cancer, cerebral palsy, epilepsy, diabetes, bipolar disorder, post-traumatic stress disorder, HIV, MS, etc.
ADA Amendments Act (ADAAA)
New Focus
“Merits of the case”
i.e., Whether the employer reasonably accommodated the employee
Now, laundry list of activities considered disabledSlide82
Reasonable Accommodation
“Any change or adjustment in the work environment or in the way things are customarily done that would enable a qualified individual with a disability to enjoy equal employment opportunity.”
OngoingInteractive
Employers have a duty to
effectively
remove equal opportunity barriers caused by the disability,
where possibleSlide83
Reasonable Accommodation
Steps:
Meet with the employeeObtain as much information as possible
Discuss available alternatives
Seriously consider employee’s suggestions
Don’t jump to conclusions about undue hardship
Be prepared to revisit if first accommodation is not effective
Document!
Interactive ProcessSlide84
Recent Cases
EEOC v. Celadon Trucking
(S.D. IN filed February 2012)Alleged Celadon policy: subject applicants to medical examinations pre-offer
Failed to hire because of disabilities or perceived disabilities
EEOC: ADA violation – medical examinations only after conditional offer
EEOC v. Old Dominion
(W.D. AR
filed
August 2012)
Employee reported alcohol problem – suspended
Alleged Old Dominion policy: would not return driver to position even up successful rehab
EEOC: Alcohol is a disability; policy is discriminatorySlide85
Medical Exam or Functional Test?
What is a Medical Exam?
Whether the test is: Administered by a health care professionalInterpreted by a health care professional
Designed to reveal an impairment of physical or mental health
Invasive
Measuring an employee’s performance of a task or measuring his or her physiological responses to performing the task
Normally given in a medical setting; and
Used with medical equipment
–
Indergard
v. Georgia-Pacific Corp.
(
9th Cir. 2009)Slide86
Medical Exam and Inquiries: Pre-Offer
Pre-offer testing rules:
Employers should not conduct a medical examination
or make inquiries of a job applicant as to whether he or she has a disability or as to the nature or severity of such a disability
However,
Employers can inquire into the
ability
of an applicant to
perform job-related functionsSlide87
Medical Exam: Post-Offer
Post-offer testing rules:Employers
can conduct a medical examination after an offer of employment has been made and prior to the start of employment duties
Employers can require the passing of a medical examination as a condition of the offer of employment if:
all other similarly situated employees are subjected to the examination, despite having a disability
the medical information obtained is kept confidential and separateSlide88
Medical Exam: Prohibitions
Prohibited examinations and inquiries:
An employer cannot: Require a medical examination; or
Make inquiries of an employee as to whether he or she is an individual with a disability or as to the nature or severity of the disability,
unless such examination or inquiry is shown to be job-related and consistent with business necessitySlide89
Medical Exam: Post-Offer Validation
Is the Employer Responsible for the Validity of the Medical Exam?
Yes, employers have a responsibility to make “due inquiry”If the employer decides to terminate an employee or applicant because of a failed medical exam, then the employer is under
a duty to investigate
the reasoning behind the physician’s issuance of a disqualifying medical certificate
There must be an analysis or basis for disqualifying the driver
–
Gaines v. Western Express, Inc.
(
M.D. Tenn. Aug. 22, 2011)Slide90
Medical Exam: Consistency
Merritt v. Old Dominion Freight Line, Inc.
(4th Cir. 2010)The medical exam, functional capacity test, or inquiry must be consistently applied to all similarly situated applicants and employees
Inconsistency in the method of implementing the test and who gets the test may result in employer liabilitySlide91
Garza v. Swift Transportation Company
CLASS ACTION:
TRUCK DRIVER WAGESSlide92
Pay Per Mile and Issues With Pay
Leonel Garza used his truck to haul freight for Swift as an owner-operator and independent contractor
Signed a standard agreement and was entitled to $.82 per dispatched mile loaded and emptyNo one identified what a dispatched mile meant or how it was to be calculated in the contract
Mile calculated using the Rand McNally Household Movers Guide (HMG) – 6.5% less than the actual miles driven on any given trip
Shorted 10-15% more miles than the mileage paid to him by Swift and suedSlide93
Drivers Involved
Three Types of Drivers are Involved in the Case:
Owner-operator drivers paid per mile based on the HMG; Owner-operator drivers paid on a “per mile” basis; and
Employee drivers, who drove as at-will employees and were paid per mile
The Lawsuit
: Involves claims for all three types of drivers:
Breach of Contract
: for failure to pay actual miles driven. Applies to all employee drivers and those with contracts that do not include reference to HMG
Breach of the Covenant of Good Faith and Fair Dealing
: for using and not disclosing that HMG shorts actual mileage, which applies to all driversSlide94
Court Ruling & Takeaways
Who Gets to Be a Part of the Lawsuit?
The courts determined that all three types of drivers could be certifiedTakeaways
Make sure your contracts clearly indicate how your drivers will be compensated
Use a payment system that accurately calculates the language used in your driver contracts
If you pay your drivers according to a particular system, such as the HMG method of payment, ensure that your contract includes exactly how your driver’s will be paid to avoid disputes over “dispatched miles” vs. “actual miles.”Slide95
Independent Contractor Update
Ruiz v. Affinity Logistics Corp.
, (9th Cir. 2012)Contractually agreed drivers were “independent contractors”Agreed to be bound as Georgia law in determining their contract status
9th Circuit applies California law
Factors assessed by Court:
Contrary to fundamental policy; and
Materially greater interestSlide96
NLRB UpdateSlide97
Unionization in America
2011:
16.3 million wage and salary workers in America were represented
by Unions.
14.8 million
actual members of a Union
=
11.8%
of the wage and
salary workforce.
Public Sector unionized workers:
37.0 %
Private Sector unionized workers:
6.9 %Slide98
Unionization by State
Chart 1. Union membership rates by state, 2011 annual averagesSlide99
Unionization on the Downslide?
Employees Represented by Unions
Source:
U.S
. Department of
Labor Bureau
of
Labor Statistics
2011
Number of Employees, in MillionsSlide100
Top Unionized Industries
Private Sector:
Utilities: 25.7%Transportation: 22.1%Telecommunications: 16.4%
Educational Services: 15.5%
Construction: 14.9%Slide101
Transportation
Employees Represented by Unions
*Source: US
Dept
of Labor Bureau of Labor Statistics
+
Source:
unionfacts.com
Number of Employees, in Millions
Transportation*
Teamsters
+Slide102
Union Representation Elections
Source: U.S.
Dept
of
Labor Bureau
of Labor
Statistics
Number of Employees, in Millions
57.2%
59.5%
59.9%
58.9%
64.7%
66.3%
67.6%Slide103
Collective Bargaining: Micro-Units
Old Rule:
Park Manor Care Center (1991): whether the interests of the group sought to be included are “sufficiently distinct from those of other employees” in order to exclude the other individuals
Specialty Healthcare & Rehab Ctr.
: August 26, 2011
Shifts the burden to employers to prove
that the excluded employees share an
“overwhelming community interest”
with the petitioned-for employees
Will
promote smaller bargaining units
that can
more easily be organized
by unionsSlide104
Micro-Units: Impact on the Trucking Industry
May permits Unions to customize the bargaining unit:
Drivers, mechanics, other small groups could all form their own bargaining unitsDifferent bargaining units / unions at different terminals
Employer would have to negotiate different collective bargaining agreements with separate micro / small units
Since Specialty…
Odwalla
:
December 9, 2011
DTG Operations, Inc.:
December 30, 2011
Bergdorf Goodman:
May 5, 2012Slide105
National Labor Relations Act: Section 7
“Employees shall have the right to self-organization, to form, join, or assist labor organizations, to bargain collectively through representatives of their own choosing, and to engage in
other concerted activities
for the purpose of collective bargaining or other
mutual aid or protection
, and shall also have the
right to refrain from any or all such activities
...”Slide106
NLRB Expanding Its Interpretation
Banner Health System
(July 30, 2012)Employee disciplined for not following company policy due to safety reasons
Human Resources instructed employee not to discuss investigation into his safety concerns
Employer: prohibition to protect the integrity of its investigation
NLRB: “to justify a prohibition on employee discussion of ongoing investigation, an employer must show that it has a
legitimate business justification
that outweighs employees’ Section 7 rights.”
Legitimate Business Justification
:
Witnesses need protection
Evidence is in danger of being destroyed
Testimony in danger of being fabricated
There is a need to prevent a cover-upSlide107
Social Media: Concerted Activity
NLRB General Counsel Report: August 18, 2011
Post Likely Protected If: The employee discusses the terms and conditions of their employment in a manner that is meant to induce or further group action
Post Not Likely Protected If:
It is best characterized as an individual complaint about working condition specific to the employee, and is not directed to co-workers or meant to induce group action
The comments are “maliciously false”
The comments are offensive or inappropriate about an employer’s clientsSlide108
Social Media: Concerted Activity
Hispanics United Buffalo
: September 2, 2011:Individual action is concerted so long as it is engaged in with the object of initiating or inducing group action; the object of inducing group action need not be express
Knauz
BMW
: September 28, 2011
Post was “logical outgrowth” of prior, concerted activity
Protected content does not shield an employee from discipline based on the unprotected contentSlide109
Social Media: Policy
NLRB General Counsel’s 2nd Report: January 24, 2012
Reviewed 14 recent social medial NLRB decisionsWork-related issues need to be the primary subject of the employee
post / conversation in order to be protected.
Cannot have blanket prohibitions against negative postings and comments about the employer.
Test: could an employee reasonably construe the rule / policy to apply to their communications regarding working conditions?Slide110
Social Media: Policy
NLRB General Counsel’s 3nd Report: May 30, 2012
Reviewed 7 company policies governing social media. 6 violated the NLRA What not to write: “… be sure that your posts are completely accurate and not misleading and that they do not reveal non-public company information on any public site.”
“Offensive, demeaning, abusive or inappropriate remakes are as out of place online as they are offline….”
“Get permission before reusing others’ content or images.”
“[This] Social Media Policy will be administered in compliance with applicable laws and regulations (including Section 7 of the National Labor Relations Act).”Slide111
Access to Social Media Accounts
Maryland Department of Public Safety and Correctional Services
2010: Policy to provide Facebook login and password for applicants and employee recertification for use in background checks
MD Legislative Response
: Approved May 2, 2012: “Labor and Employment – Username and Password Privacy Protection and Exclusions”
Other
state legislation pending
:
California – Minnesota – South Carolina
Delaware – New Jersey – Texas
Illinois – New York – Washington State
Michigan – Pennsylvania
Password Protection Act of 2012
Social Networking Online Protection ActSlide112
Questions & AnswersSlide113Slide114
Linda Longton
Senior Vice President, Editorial & Research
Randall-Reilly Business Media & InformationSlide115Slide116
Dr. Frank Luntz
Pollster & Communications ProfessionalSlide117Slide118
Alan Sims
Vice President & Executive Director, Events Division
Randall-Reilly Business Media & InformationSlide119Slide120Slide121Slide122Slide123Slide124Slide125Slide126Slide127Slide128Slide129Slide130Slide131Slide132Slide133Slide134