NFIB Proclaims Victory in Union-Walk-Around Dispute

Date: May 02, 2017

Last fall the National Federation of Independent Business (NFIB) filed suit to enjoin the Occupational Health and Safety Administration from enforcing a rule that purported to require small business owners to allow union officials to accompany OSHA inspectors during worksite safety inspections. The so called “Union Walk Around Rule” was controversial from its inception because it opened-up non-unionized businesses to unlawful union invasions—which promised to turn the OSHA inspection process (already stressful enough for employers) into a de facto unionization campaign. Not only was that concerning on a practical level for employers worried about union agitators sowing the seeds of discontent, but it was also troubling, on a philosophical level, to think that the federal government was effectively giving union organizers a platform to proselytize. To put it bluntly, this looked to us like one more example of the Obama Administration placing its hands on the scale in favor of Big Labor.

But even setting aside our substantive objections to the Union Walk Around Rule, we had a fundamental problem with the way OSHA pronounced the Rule. Specifically, the Union Walk Around Rule was unveiled in a simple memorandum that proclaimed new standards for third parties accompanying OSHA inspectors. And as we’ve discussed many times on this forum, NFIB remains deeply troubled with the practice of informal rulemaking—wherein federal bureaucrats institute substantive rules without going through the proper channels.

The, the Administrative Procedure Act requires that rules must go through a process called notice-and-comment—which gives the public an opportunity to raise concerns with a rule before it becomes effective. As detailed more fully in our 2015 white paper, The Fourth Branch and Underground Regulations, rules pronounced outside of the notice-and-comment process are problematic for numerous reasons and enable federal agencies to fly under the radar.

Thankfully, the National Federation of Independent Business lawsuit prompted OSHA to rescind the Union Walk Around Rule. The Obama Administration initially sought to defend the Rule—filing a motion to dismiss our case. But, in February, a federal district court judge ruled that NFIB’s lawsuit could proceed. As outlined in our previous post, that paved the way for what we anticipated would be an imminent courtroom victory.
Yet in the wake of that decision, the Trump Administration decided it was time to reverse course. OSHA issued a new memorandum—killing the Union Walk Around Rule. Accordingly, NFIB voluntarily dismissed its lawsuit and praised the new Administration.

Of course, this leaves unresolved the truly significant procedural issues raised in NFIB’s lawsuit. But rest assured, we will have future opportunities to address these concerns in other cases, whether in this Administration or the next. We will continue to press the federal courts to strictly enforce the APA’s notice-and-comment requirements because ultimately that is a key part of our fight to reign-in federal power. We remain as committed as ever to forever ending the practice of underground regulations.

Special thanks to Damien Schiff and Joshua Thompson of the Pacific Legal Foundation for their assistance NFIB v. OSHA. Thompson offers further commentary here.

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