Human Resources News & Insights

$5.3M verdict gives employers blueprint to sue bullying unions

In recent years, courts and the National Labor Relations Board (NLRB) have given unions broad free speech rights. But now, a jury verdict has shown employers they can fight back if a union resorts to harmful bullying tactics in an attempt to organize workers. 

A Harris County, TX, jury verdict is making the Service Employees International Union (SEIU) — which has nearly two million members nationwide — pay the Houston area-based Professional Janitorial Service (PJS) a whopping $5.3 million in damages.

The jury said the union’s organizing tactics went much too far and unjustly maligned the company’s reputation.

Union got dirty

Here’s what happened: SEIU was trying to unionize six janitorial services companies in the Houston area. Five signed neutrality agreements, opening the doors to union organizing.

The sixth, PJS, refused to sign an agreement with SEIU without first giving the workers a chance to vote in an election.

At that point, SEIU decided to play hardball, according to court documents.

Bully tactics

SEIU then recruited PJS workers to file wage-and-hour claims against the company with the DOL. More than two dozen claims were filed, alleging that PJS violated wage and overtime laws.

Only one claim was found to have merit, and PJS paid $1,854 as a result of it. The rest of the claims were thrown out.

SEIU also filed unfair labor charges against PJS, claiming employers had been illegally let go from their jobs due to their union organizing efforts. In total, 19 such charges were filed and, much like with all but one of the wage-and-hour claims, PJS was found to have committed no wrongdoing.

Next came the SEIU attacks on PJS customers. The union directed fliers, emails, newsletters, web posts and letters at area businesses, alleging that PJS was violating wage and labor laws. SEIU also hosted rallies and protests against PJS.

As a result, PJS lost roughly a dozen customers. One PJS customer even said union protesters barged into her building and conference rooms to protest her business relationship with PJS.

Defamation and disparagement

Rather than give in to the union, PJS filed a defamation and disparagement against SEIU in a Texas state court. Nine years later, after a long series of SEIU stall tactics meant to drag out the legal battle, the lawsuit went to trial.

The jury voted 10-2 in favor of PJS and awarded the company $5.3 million in lost business and punitive damages.

First of its kind

According to the law firm Fisher & Phillips LLP, which analyzed the lawsuit, and the Houston Chronicle, this is the first time in American history a union has been found by a jury to be guilty of defamation or disparagement against a business.

As a result, it not only shows that employers can fight union bullying in court and win, but it also lays out a blueprint for how employers can do it.

Specifically, PJS gathered and saved a lot of correspondence — emails, SEIU’s campaign manual and other communications — that showed SEIU specifically intended to cause financial harm to PJS through the union’s unfounded legal accusations and confrontations with PJS customers.

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