The National Labor Relations Board (“NLRB” or the “Board”) took significant steps to limit the power of property owners to restrict contractors’ workers access to their property in a 3-2 decision on Friday. In Bexar County II, the Board reverted to the test articulated in New York New York Hotel & Casino, 356 NLRB 907 (2011), concluding that property owners may only restrict access by contractors’ workers when the workers’ activities “significantly interfere” with the use of the property, or where the property owner has “another legitimate business reason” to remove them from their property.

Bexar County I: In Bexar County I, the County (or the property owner) expelled off-duty Symphony (a separate employer) employees from its premises after the contractor employees protested the Ballet’s (another separate entity) use of recorded music rather than live music performed by the Symphony.  The off-duty Symphony employees leafletted patrons in attendance at a ballet performance and filed an unfair labor practice charge after they were expelled from the premises.  In that case, the Board found that property owners were permitted to exclude from their property off-duty contractor employees engaging in union or other protected activities unless (1) the employees work both “regularly” and “exclusively” on the property, and (2) the property owner cannot show that the employees have one or more “reasonable” non-trespassory alternative means to communicate their message.

As our partner Chad Horton wrote in a September 2021 e-lert, the American Federation of Musicians, which represents the Symphony employees, appealed to the U.S. Court of Appeals for the D.C. Circuit.  The D.C. Circuit held that the Bexar County I test was arbitrary and remanded the case to the Board to either refine the test for off duty workers’ access to property or to develop a new one.

Bexar County II:  In rejecting the Bexar County I test, the Board majority agreed with the D.C. Circuit and stated that the property-owner-friendly test undermined contractor employees’ rights to engage in protected union activity by enabling property owners to “severely restrict off-duty contractor employees’ access to its property to engage in Section 7 activity for reasons completely unconnected to the employer’s interest in protecting its property.”  (“Section 7”  of the National Labor Relations Act provides workers the rights to engage – or not – in  protected concerted activities regarding their wages, hours, or other working conditions.) The Board went on to state that its decision in Bexar I could even create an incentive for employers to use contractors rather than hire the employees as workers to avoid complying with workers’ statutory protections.

The Board reasoned that even if contractor employees have a sufficient connection to the property, the Bexar County I test still allowed property owners to deny access if they could demonstrate workers have access to a reasonable alternative non-trespassory channel of communication.  The Board stated that this aspect of the test should not be relevant because the property owner permits (and expects) the same workers to regularly enter its property to work for their contractor-employer.  The Board reasoned that the Bexar County I test ultimately failed to ensure “proper accommodation between the contractor employees’ Section 7 rights and the property owner’s property rights.”

The New (But Also Old) Test:  To ensure the proper accommodation, the Board reinstated the New York New York test, stating that the test placed a “reasonable condition” on the property owner’s right to exclude contractor employees.  According to the Board, the test—which requires property owners to demonstrate that contractor employees’ protected activity would significantly interfere with its use of the property or that the exclusion is justified by another legitimate business reason—ensures that property owners do not have to permit significant interference with their property.  The Board even suggests that property owners should utilize their contractual and working relationship with contractors to protect property rights, including by directing the contractor’s managers and supervisors to take action to protect operational and property interest which may occur when they observe misconduct or to direct the removal of unruly contractor employees from the premises.

While property owners are not wholly prohibited from excluding off-duty contractor employees from their premises, property owners will now bear the burden of demonstrating that the conduct of these workers significantly interferes with the use of the property, or that legitimate business reasons support the exclusion.