“Labor Peace” Via Executive Decree? New York City Mayor Latest to Issue an Executive Order

  • August 5, 2016

 New York City Mayor Latest to  Issue an Executive Order  labor preace

Here’s another development taking place at the local level that retailers and other service industry employers may want to keep an eye on.  Thanks to Clyde Jacob for raising this issue.

Details from the US Chamber of Commerce:  (full disclosure: CUE Inc. is a member!)

On July 14, 2016, New York City Mayor Bill DeBlasio issued an Executive Order entitled “Labor Peace for Retail Establishments at City Development Projects.”  The EO requires real estate developers which receive at least $1 million in financial assistance from the City to require its current and future tenants who operate “retail or food service establishments” on certain projects to enter into a neutrality agreement (referred to as a “labor peace agreement”) with a union which seeks to represent the tenant’s employees (there are carve outs for employers who employ less than 10 employees and who occupy less than 15,000 square feet).  The City claims that such agreements will help to avoid disruptions and protect its interest in these development projects.  Other elements of the EO include the following:

  • The EO went into effect immediately (July 14), but only applies to projects authorized after the effective date.
  • The developer’s obligation to require tenants to sign “labor peace agreements” lasts for 10 years or for as long as the developer receives financial assistance.
  • The enforcement provisions are vague, as the EO provides that “the Mayor shall designate an official or officials who shall be responsible for monitoring compliance with such requirements…and recommending appropriate remedies for any breach…”

Unfortunately, this EO is the latest version of similar “labor peace” statutes and ordinances passed in other localities.  Some challenges to these laws have been upheld, while others have been unsuccessful – the facts and circumstances of each situation play an important role in the outcome.  For example, the Chamber sued to successfully overturn California’s statute in the 7-2 Supreme Court decision in Chamber of Commerce v. Brown.  Although the law at issue in Brown did not involve a “labor peace” agreement per se, its restrictions on employer speech are perhaps analogous to the EO’s employer neutrality requirement.  We are in the process of reviewing Brown and other relevant caselaw to examine how they may apply to the EO.

Here are some additional resources gleaned from a quick Google search: