Using Worker Focus Groups Carries Risks for Employers

For years, management gurus have touted employee focus groups as the answer to improving cooperation and communication between workers and managers on issues ranging from downsizing to designing compensation policies.

But the thought of employee focus groups makes Bill Altman cringe. As a labor lawyer with Bingham Farms, Michigan-based Vercruysse Murray & Calzone, Altman has spent the past 15 years counseling companies on how to avoid federal labor law violations and trying to extricate the unlucky ones from complaints filed by union organizers.

He warns that focus groups, even when set up by managers with the most noble motives, can easily backfire and expose a company to a litigation nightmare.

“It’s OK to get a bunch of engineers together to discuss the best way to design a truck axle,” Altman says. “But as soon as you get away from the product and into work relationships and employee relations, you’re just asking for trouble.”

What companies often don’t realize, Altman says, is that when they select a representative group of employees and ask them to give recommendations that management may act on, federal regulators may decide that the focus group qualifies as a labor organization—the legal equivalent of a union. And that’s a big no-no. Federal law expressly bars companies from setting up or running such labor organizations to prevent them from subverting employees’ rights to collective bargaining. “If you’re an employer, you’re not allowed to create your own company union,” Altman explains.

Daniel O’Meara, a Berwyn, Pennsylvania-based labor lawyer who is a partner in the law firm Montgomery, McCracken, Walker & Rhoads, agrees that employer-organized focus groups can pose potential labor law problems.

But he says a 2001 National Labor Relations Board decision, in which the board found that Crown Cork & Seal Co. did not violate the law by maintaining employee committees at a Texas plant, can provide employers with a “good faith” defense. It’s critical, however, that there is no intent to undermine a union organizing effort.

O’Meara says companies can keep themselves out of trouble by making sure that focus groups don’t evolve into permanent organizations that can appear to be employee-run unions.

“If it’s an ad hoc, one-time event, you’re safer,” he says. O’Meara also advises that companies suspend focus groups the moment a union organizing effort begins and explain the reason to the workforce.

Companies dig themselves into a deeper hole by naively using focus groups to discuss issues such as work rules and compensation. Altman cites the case of a past client that set up a plant council, originally with the vague purpose of discussing various workplace issues. “It evolved into talking about work rules, wages and benefits,” Altman says. “The group’s members were selected by the employees, and they served in the group for a term of one year. And when management met with them, it would take their recommendations and say either yes or no to them.”

The company ran into problems when union organizers tried and failed to organize a segment of the plant that was represented by the council. “When they lost the election, they went straight to the National Labor Relations Board and complained about the council,” Altman says.

Ultimately, the NLRB decided that the council was an illicit, employer-dominated ersatz union and ordered it disbanded. While the company wasn’t hit with a monetary penalty, it suffered the embarrassment of having to post a notice in all of its facilities informing the workforce that it had violated labor laws. “I haven’t met an employer who would want to have a poster like that in their cafeteria,” Altman says.

“There are ways to do focus groups and not run afoul of the law, but you have to be very cautious,” Altman says.

For example, members of such a group should be randomly selected and should not report back to other workers or present proposals on their behalf. Also, it’s important to rotate frequently the membership to discourage the perception that the members are designated representatives of the workforce.

And employers should avoid doing anything that regulators might see as exerting influence upon such a group. Letting the members meet on company time, providing a meeting space for them or even serving them lunch can get a company into trouble.

The safest bet may be to use a simpler method of getting feedback, Altman says. “If you want to poll the workforce, for example, it’s a lot less risky.”

Workforce Management, January 2011, p. 14 — Subscribe Now!