Human Resources News & Insights

Workers complaining about pay? What you can’t say to them now

There are three phrases you and your managers must be careful NOT to say to employees who walk off the job complaining about pay or scheduling. 

They are:

  • “You’re fired.”
  • “You’re terminated.”
  • “You’re discharged.”

And you can’t use those phrases even if the employees are at-will.

It’s the law

This is something a lot of managers (especially those in at-will states) don’t realize: Terminating a group of employees for essentially “striking” over pay and/or scheduling disputes amounts to a violation of workers’ rights under the National Labor Relations Act (NLRA).

Yes, the NLRA mostly pertains to labor organization efforts and unions, but may of its protections cover non-unionized employees as well.

This particular protection was center stage during a legal proceeding that involved Tri-State Wholesale Building Supplies, a Cincinnati-based window and door manufacturer, and 11 of its employees.

Tri-State, which has zero union employees, was ordered by a federal appeals court to reinstate the workers with back pay after it terminated them for walking off the job over a pay dispute.

What went wrong?

Here’s what happened: Tri-State had a holiday pay policy that said employees would be paid for the week between Christmas and New Year’s Day, despite the company being closed during that period. New Year’s Day, however, wasn’t specifically listed as a paid holiday.

So the production manager asked the company president if employees would be paid for New Year’s Day. After the conversation, the production manager was under the impression that employees would be paid for New Year’s Day if they worked the Friday following New Year’s Day (employees normally didn’t work on Fridays). So the production manager told employees they’d be paid for working on the Friday after New Year’s.

Numerous employees showed up to work on that Friday. The following week, the company president realized Tri-State didn’t normally pay employees for New Year’s Day and said employees wouldn’t be paid for that day after all.

Upon hearing the news, 11 employees walked out after their afternoon break. Most of them didn’t report to work the next day, and Tri-State began hiring replacement workers to keep operations going.

Tri-State then sent the striking workers a letter informing them they’d been “replaced” and that their employment was “terminated.”

The letter also said the workers may be eligible for rehire if one of the replacements left and a position opened up.

What’s wrong with that?

Here’s why Tri-State got into hot water for its actions: The NLRA says it’s illegal for an employer to interfere with or restrain employees from engaging in “concerted activities for the purpose of … mutual aid or protection.”

Translation: Actions by a group of employees to improve working conditions — like pay — are protected from punishment and/or discipline.

In addition, the law says employees striking for economic concessions — like higher wages, shorter hours or better working conditions — cannot be “discharged.” However, the law says employers can “replace” those individuals.

What’s the difference?

“Discharged” means terminated. Period.

“Replaced” is different. It means permanent replacements can be given the strikers’ jobs, so long as the strikers can get their jobs back when openings occur. That caveat in the NLRA allows employers like Tri-State to continue operations when employees strike, while still providing striking workers with some employment protections.

Labor charge filed

After receiving Tri-State’s letter, one of the workers filed a complaint with the National Labor Relations Board, which ruled the company violated the NLRA by terminating the strikers.

Tri-State appealed the ruling, saying it actually “replaced” rather than terminated the striking workers.

But a federal appeals court disagreed. It said the workers could draw “reasonable inferences” from the letter’s language — specifically the phrase “… your position has been filled and your employment terminated” — that led them to believe they’d been terminated.

As a result, the court ruled Tri-State illegally punished workers for engaging in protected concerted activities, and it ordered Tri-State to pay the workers back wages and reinstate them.

What employers can do

There is a silver lining here for employers: The ruling provides a blueprint for what to do when employees “strike” or walk off the job as a result of a dispute over pay, scheduling or working conditions.

Bottom line: Don’t tell them they’ve been “terminated,” “fired,” “discharged” or anything of the sort.

Instead, it’s better to say, “permanently replaced.” You also want to state the business need to keep operations going.

What you want to be careful NOT to do is give the impression workers were punished for striking or complaining about pay, hours, conditions, etc.

Cite: Tri-State Wholesale Building Supplies Inc. v. NLRB

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