Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 1 of 117 No. 17-35693 In the United States Court of Appeals for the Ninth Circuit Dan Clark, et al., Plaintiff-Appellants, v. City of Seattle, et al., Defendants-Appellees. ON APPEAL FROM THE UNITED STATES DISTRICT COURT FOR THE WESTERN DISTRICT OF WASHINGTON DEFENDANTS-APPELLEES’ ANSWERING BRIEF PETER S. HOLMES Seattle City Attorney GREGORY C. NARVER MICHAEL K. RYAN SARA O’CONNOR-KRISS JOSH JOHNSON Assistant City Attorneys Seattle City Attorney’s Office 701 Fifth Avenue, Suite 2050 Seattle, WA 98104 (206) 684-8200 STEPHEN P. BERZON STACEY M. LEYTON PEDER J. THOREEN P. CASEY PITTS Altshuler Berzon LLP 177 Post Street, Suite 300 San Francisco, CA 94108 (415) 421-7151 Attorneys for Defendants-Appellees City of Seattle et al. Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 2 of 117 TABLE OF CONTENTS TABLE OF AUTHORITIES ................................................................................ iii INTRODUCTION ................................................................................................. 1 JURISDICTIONAL STATEMENT ....................................................................... 4 STATUTORY ADDENDUM ................................................................................ 5 STATEMENT OF THE CASE .............................................................................. 5 I. The Ordinance ............................................................................................. 5 II. Litigation history ....................................................................................... 10 SUMMARY OF ARGUMENT ........................................................................... 12 STANDARD OF REVIEW ................................................................................. 14 ARGUMENT....................................................................................................... 16 I. The District Court’s dismissal of Plaintiffs’ NLRA claims should be affirmed ..................................................................................................... 16 A. Sections 8(b)(4) and 8(e) of the NLRA limit the ability of organizations representing NLRA-covered employees to involve neutral third parties in their labor disputes ....................................... 16 B. Plaintiffs’ NLRA claims are not ripe ................................................ 21 C. Plaintiffs’ NLRA claims fail on the merits ....................................... 29 1. The NLRA does not apply to disputes solely involving NLRA-exempt workers and their representatives ................. 31 2. The Ordinance does not require or coerce anyone to cease doing business with anyone else ........................................... 37 3. Advancing drivers’ interests with respect to driver coordinators is not “secondary” activity................................ 44 D. Machinists preemption does not apply ............................................. 49 i Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 3 of 117 II. The District Court’s dismissal of Plaintiffs’ First Amendment claim should be affirmed ..................................................................................... 51 A. Plaintiffs’ First Amendment claim is not ripe................................... 51 B. Plaintiffs’ First Amendment claim fails on the merits ...................... 51 CONCLUSION ................................................................................................... 58 STATEMENT OF RELATED CASES ................................................................ 59 CERTIFICATE OF COMPLIANCE.................................................................... 60 CERTIFICATE OF SERVICE............................................................................. 61 STATUTORY ADDENDUM ............................................................................. A-i ii Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 4 of 117 TABLE OF AUTHORITIES Cases 14 Penn Plaza LLC v. Pyett, 556 U.S. 247 (2009) .........................................................................................56 Abbott Labs. v. Gardner, 387 U.S. 136 (1967) .........................................................................................28 Air Line Pilots Association v. NLRB, 525 F.3d 862 (9th Cir. 2008) .......................................................... 34, 35, 36, 37 Air Transp. Ass’n of Am., Inc. v. NMB, 663 F.3d 476 (D.C. Cir. 2011) ..........................................................................55 American Trucking Associations, Inc. v. City of Los Angeles, 559 F.3d 1046 (9th Cir. 2009) ..........................................................................26 Associated General Contractors of California, Inc. v. NLRB, 514 F.2d 433 (9th Cir. 1975) ............................................................................25 Bell Atl. Corp. v. Twombly, 550 U.S. 544 (2007) ............................................................................. 15, 33, 49 Bhd. Railway Trainmen v. Jacksonville Term. Co., 394 U.S. 369 (1969) ................................................................................... 13, 31 Bierman v. Dayton, 227 F.Supp.3d 1022 (D. Minn. 2017) ......................................................... 52, 56 Bierman v. Dayton, No. 14–3021(MJD/LIB), 2014 WL 4145410 (D. Minn. Aug. 20, 2014) ...........51 Bishop Paiute Tribe v. Inyo County, 863 F.3d 1144 (9th Cir. 2017) ..........................................................................29 Califano v. Sanders, 430 U.S. 99 (1977) ...........................................................................................29 iii Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 5 of 117 Chamber of Commerce v. Seattle, No. C17–0370RSL, __ F.Supp.3d __, 2017 WL 1233181 (W.D. Wash. Apr. 4, 2017) .....................................................................................................10 Chandler v. State Farm Mut. Auto. Ins. Co., 598 F.3d 1115 (9th Cir. 2010) ..........................................................................21 Chipman Freight Services Inc. v. NLRB, 843 F.2d 1224 (9th Cir. 1988) ........................................................ 44, 45, 47, 48 City of Dallas v. Stanglin, 490 U.S. 19 (1989) ...........................................................................................52 Connell Constr. Co. v. Plumbers Local Union No. 100, 421 U.S. 616 (1975) .........................................................................................20 Constr. Bldg. Material, Teamsters, 222 NLRB 423 (1976) ......................................................................................47 Cotter v. Lyft, Inc., 60 F.Supp.3d 1067 (N.D. Cal. 2015) ................................................................38 D’Agostino v. Baker, 812 F.3d 240 (1st Cir. 2016) ................................................................. 52, 56, 57 Davis v. FEC, 554 U.S. 724 (2008) .........................................................................................28 Edward J. DeBartolo Corp. v. Florida Gulf Coast Bldg. & Constr. Trades Council, 485 U.S. 568 (1988) ................................................................................... 18, 22 Gerawan Farming, Inc. v. Agric. Labor Relations Bd., __ P.3d __, 2017 WL 5662395 (Cal. Nov. 27, 2017) ........................................31 Golden State Transit Corp. v. City of Los Angeles, 475 U.S. 608 (1986) .........................................................................................24 Greene v. Dayton, 806 F.3d 1146 (8th Cir. 2016) ..........................................................................50 Harris v. Quinn, 134 S.Ct. 2618 (2014)................................................................................. 57, 58 iv Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 6 of 117 Hawaii Newspaper Agency v. Bronster, 103 F.3d 742 (9th Cir. 1996) ............................................................................. 4 Hicks v. Miranda, 422 U.S. 332 (1975) .........................................................................................53 Hill v. Serv. Employees Int’l Union, Healthcare Ill., 850 F.3d 861 (7th Cir. 2017) ...................................................................... 52, 58 In re Bituminous Coal Wage Agreements, 756 F.2d 284 (3d Cir. 1985) .............................................................................41 In re United Bhd. of Carpenters, Local Union No. 1506, 355 NLRB 797 (2010) ......................................................................................22 Int’l Longshoremen’s Ass’n, AFL-CIO v. Davis, 476 U.S. 380 (1986) .........................................................................................30 Jarvis v. Cuomo, 660 Fed.Appx. 72 (2d Cir. 2016) ......................................................................52 Kingman Reef Atoll Investments, LLC v. United States, 541 F.3d 1189 (9th Cir. 2008) ..........................................................................15 Knight v. Minnesota Cmty. Coll. Faculty Ass’n, 460 U.S. 1048 (1983) ................................................................................passim Local 3, Int'l Bhd. of Electrical Workers, 244 NLRB 357 (1979) ......................................................................................24 Machinists v. Wisconsin Employment Relations Commission, 427 U.S. 132 (1976) ............................................................................. 24, 49, 50 Marine Engineers Beneficial Association v. Interlake Steamship Co., 370 U.S. 173 (1962) ................................................................................... 36, 37 Marriott Corp. v. NLRB, 491 F.2d 367 (9th Cir. 1974) ............................................................................35 Maya v. Centex Corp., 658 F.3d 1060 (9th Cir. 2011) ..........................................................................15 v Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 7 of 117 Mentele v. Inslee, No. C15-5134, 2016 WL 3017713 (W.D. Wash. May 26, 2016) ......................52 Minnesota State Board for Community Colleges v. Knight, 465 U.S. 271 (1984) .........................................................................................51 Mullhall v. UNITE HERE Local 355, 618 F.3d 1279 (11th Cir. 2010)................................................................... 55, 56 Nat’l Woodwork Mfrs. Ass’n v. NLRB, 386 U.S. 612 (1967) ............................................................................. 40, 44, 45 NLRB v. Chauffeurs Local 525, 773 F.2d 921 (7th Cir. 1985) ............................................................................41 NLRB v. Drivers Local Union No. 639, 362 U.S. 274 (1985) .........................................................................................18 NLRB v. Hotel & Rest. Employees Union Local 531, 623 F.2d 61 (9th Cir. 1980) ..............................................................................42 NLRB v. Int’l Bhd. of Teamsters, Local 251, 691 F.3d 49 (1st Cir. 2012) ................................................................... 27, 40, 48 NLRB v. Local 3, Int'l Bhd. of Electrical Workers, 471 F.3d 399 (2d Cir. 2006) .............................................................................19 NLRB v. Nash-Finch Co., 404 U.S. 138 (1971) .........................................................................................50 NLRB v. Retail Store Emp. Union, Local 1001, 447 U.S. 607 (1980) .........................................................................................19 O’Connor v. Uber Tech., Inc., 82 F.Supp.3d 1133 (N.D. Cal. 2015) ................................................................39 Overstreet v. United Bhd. of Carpenters, Local Union No. 1506, 409 F.3d 1199 (9th Cir. 2005) ..........................................................................19 Pac. Maritime Assoc. v. Local 63, Int’l Longshoremen’s Union, 198 F.3d 1078 (9th Cir. 1999) ..........................................................................33 vi Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 8 of 117 Production Workers Union Local 707 v. NLRB, 793 F.2d 323 (D.C. Cir. 1986) .................................................................... 46, 47 Roberts v. United States Jaycees, 468 U.S. 609 (1984) .........................................................................................52 Rumsfeld v. Forum for Academic and Institutional Rights, 547 U.S. 47 (2016) ...........................................................................................53 San Diego Building Trades Council v. Garmon, 359 U.S. 236 (1959) ................................................................................... 29, 49 Savage v. Glendale Union High Sch. Dist. No. 205, 343 F.3d 1036 (9th Cir. 2003) ..........................................................................15 Texas v. United States, 523 U.S. 296 (1998) .........................................................................................21 Thomas v. Anchorage Equal Rights Comm’n, 220 F.3d 1134 (9th Cir. 2000) ..........................................................................21 Unite Here Local 355 v. Mulhall, 134 S.Ct. 594 (2013).........................................................................................56 United Farm Workers, AFL-CIO v. Ariz. Agricultural Emp. Relations Bd., 669 F.2d 1249 (9th Cir. 1982) .................................................................... 31, 50 United States v. Salerno, 481 U.S. 739 (1987) ................................................................................... 15, 29 Univ. of Pa. v. E.E.O.C., 493 U.S. 182 (1990) .........................................................................................56 Virgin Atl. Airways, Ltd. v. NMB, 956 F.2d 1245 (2d Cir. 1992)............................................................................55 Wash. State Grange v. Wash. State Republican Party, 552 U.S. 442 (2008) .........................................................................................15 Willmar Poultry Co. v. Jones, 430 F.Supp. 593 (D. Minn. 1977) .....................................................................50 vii Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 9 of 117 Statutory Authorities 29 U.S.C. §151 .....................................................................................................40 29 U.S.C. §152 .....................................................................................................32 29 U.S.C. §158 ..............................................................................................passim 29 U.S.C. §160 .....................................................................................................43 29 U.S.C. §187 .....................................................................................................43 Seattle, Wash. Municipal Code §6.208.010...........................................................28 Seattle, Wash. Municipal Code §6.310.110............................................................ 7 Seattle, Wash. Municipal Code §6.310.130...........................................................28 Seattle, Wash. Municipal Code §6.310.735....................................................passim Rules and Regulations Fed. R. Civ. P. 12(b) .............................................................................................10 Additional Authorities 2 The Developing Labor Law (7th ed. 2017) ................................................... 17, 19 Frankfurter & Greene, The Labor Injunction (1930) .............................................17 viii Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 10 of 117 INTRODUCTION The Seattle Ordinance at issue in this appeal allows drivers who provide services for for-hire transportation companies like Uber and Lyft to engage in a multi-step process for designating an Exclusive Driver Representative (“EDR”), which, if certified, can negotiate on their behalf with the companies for which they drive about topics such as safe driving, vehicle equipment standards, drivers’ hours and conditions of work, and compensation to drivers. Seattle, Wash. Municipal Code (“SMC”) 6.310.735.H.1. Any resulting agreement can take effect only if approved by a City official, based on a determination that the agreement will “promote[] the provision of safe, reliable, and economical for-hire transportation services and otherwise advance the public policy goals set forth in” the Ordinance. SMC 6.310.735.H.2, I.2. The Ordinance applies only to drivers who are independent contractors excluded from the protections of the National Labor Relations Act, and expressly excludes all NLRA-covered employees from its provisions. Ordinance §6. To date, no EDR has sought certification or been certified as the representative of drivers for any company, and no agreement has been negotiated or implemented under the Ordinance. In this pre-enforcement challenge to the Ordinance, Plaintiffs are a small group of drivers for Uber and Lyft whose primary claim is that the Ordinance is preempted by Sections 8(b)(4) and 8(e) of the NLRA, 29 U.S.C. §158(b)(4), (e). 1 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 11 of 117 Those provisions regulate the tactics that organizations representing NLRA-covered employees may use to gain leverage in their labor disputes, by limiting those organizations’ ability to involve neutral third parties in their disputes. Plaintiffs assert their NLRA preemption claims even though they do not dispute that the Ordinance applies only to independent contractors not covered by the NLRA, to organizations that represent such independent contractors, and to companies that treat their drivers as independent contractors rather than NLRA-covered employees. Thus, Plaintiffs’ claims rest on faulty premise: that the NLRA applies. Plaintiffs separately assert that by permitting drivers to select a single representative to negotiate terms and conditions applicable to all drivers that contract with a particular company, the Ordinance violates the First Amendment associational rights of drivers who choose not to join or support the EDR. As the District Court rightly recognized, Plaintiffs’ claims fail for numerous reasons. As an initial matter, none of Plaintiffs’ claims are ripe, and the courts therefore lack Article III jurisdiction over them. Plaintiffs’ claims would ripen only if—at the very least—an organization were to successfully procure statements of support from thousands of drivers working for Uber or Lyft and be certified by the City as the EDR for those companies’ drivers. That certification has not yet occurred (or even been sought), and may never happen, particularly given the large number of drivers that contract with each company and the unstable and shifting nature of 2 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 12 of 117 the companies’ driver workforces. To the extent Plaintiffs’ claims are predicated on the execution of a future City-approved agreement governing the terms and conditions of Uber or Lyft drivers, their claims are even more remote and uncertain, and the argument that they are ripe is even less plausible. Even if Plaintiffs’ claims were ripe, moreover, they would all fail on their merits. First, because the Ordinance governs only the conduct of independent contractors who are expressly exempted from NLRA coverage, Sections 8(b)(4) and 8(e) have no application here. Indeed, as the District Court recognized, organizations representing independent contractor drivers covered by the Ordinance are excluded from the NLRA’s definition of “labor organizations,” and are not subject to the prohibitions established by Sections 8(b)(4) and 8(e). Second, even if these NLRA prohibitions could apply to the non-NLRAcovered workers and organizations subject to the Ordinance, the Ordinance does not authorize or require any conduct that could even arguably violate these NLRA provisions. Third, even if they applied, Sections 8(b)(4) and 8(e) prohibit only conduct targeting neutral persons or entities who have no involvement in the relevant labor dispute—unlike Uber and Lyft here. 3 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 13 of 117 Finally, Plaintiffs’ theory that exclusive representation in negotiations violates their First Amendment speech and associational rights also fails, and indeed has been squarely rejected by every court to consider it, including the United States Supreme Court. As has been the case for the many decades during which employees have been able to designate an exclusive representative of their workforce in negotiations with management—under the NLRA as well as under state laws governing public employees, agricultural employees, and other NLRA-excluded workers—such a system of exclusive representation does not impinge upon the First Amendment rights of objecting workers. Contrary to Plaintiffs’ contentions, the First Amendment does not guarantee workers the right to negotiate the terms and conditions governing their work on an individual basis. JURISDICTIONAL STATEMENT Defendants-Appellees (hereinafter “the City”) agree with Plaintiffs’ statement regarding the statutory basis for jurisdiction, the finality of the judgment below, and the timeliness of this appeal. As detailed below, however, the District Court lacked Article III jurisdiction over the claims in this case because they are not ripe. See Hawaii Newspaper Agency v. Bronster, 103 F.3d 742, 746 (9th Cir. 1996) (“The ripeness doctrine precludes federal courts from exercising their jurisdiction over an action that is filed before a real dispute exists between the parties.”). Therefore, this Court similarly lacks jurisdiction over this appeal. 4 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 14 of 117 STATUTORY ADDENDUM Pertinent statutes, ordinances, and rules appear in the separate Addendum. STATEMENT OF THE CASE I. The Ordinance On December 14, 2015, the Seattle City Council adopted the Ordinance Relating to Taxicab, Transportation Network Company, and For-Hire Vehicle Drivers, “to ensure safe and reliable for-hire and taxicab transportation service.” Ordinance (“Ord.”) §1.C.1 The Ordinance provides a means for for-hire drivers to collectively address the terms and conditions of their contractual relationships with entities like Uber and Lyft, or taxicab companies, that provide for-hire transportation services to the public. The Ordinance applies only to independent contractors, and expressly excludes from its coverage drivers who are “employees” under the NLRA. Ord. §6. In enacting the Ordinance, the City Council found that such entities (which the Ordinance calls “driver coordinators”) “establish the terms and conditions of their contracts with their drivers unilaterally, and can impose changes … without any prior warning or discussion.” Id. §1.E. In the Council’s judgment, such unilaterally imposed terms “adversely impact the ability of a for-hire driver to 1 The Ordinance is included at pages A-19 to A-22 of the Addendum to this brief. 5 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 15 of 117 provide transportation services in a safe, reliable, stable, cost-effective, and economically viable manner,” including by leading to “driver unrest and transportation service disruptions.” Id. §§1.E, 1.F. The Council determined that providing a means for collective negotiations would improve the safety and reliability of for-hire transportation services by, among other things, reducing turnover, increasing driver commitment and experience, and alleviating the pressure drivers face to provide transportation services in an unsafe manner (such as by working too many hours, operating vehicles at unsafe speeds, or ignoring necessary maintenance). Id. §1.I, J. The Ordinance establishes a multistep process for independent contractor drivers to designate an EDR to negotiate with their driver coordinators. First, nonprofit entities may apply for designation as a “qualified driver representative” (“QDR”). SMC 6.310.735.B, C. If an applying entity satisfies the Ordinance’s requirements and any implementing rules issued by the City’s Director of Finance and Administrative Services (“Director”), it will then be designated as a QDR. After being so designated, a QDR may notify a driver coordinator operating within Seattle that it intends to seek to represent that coordinator’s drivers. SMC 6.310.735.C.2. A driver coordinator receiving such notice must provide the QDR with contact information for all of its “qualifying drivers” after a specified period of time. SMC 6 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 16 of 117 6.310.735.D.2 After receiving a driver coordinator’s list, a QDR has 120 days to submit statements of interest from a majority of qualifying drivers expressing their desire to be represented by the QDR for the purpose of collective negotiations with that driver coordinator. SMC 6.310.735.F.1. At the close of that 120-day period, the Director determines whether the QDR has submitted statements from a majority of such drivers, and if so, certifies the QDR as the EDR for that driver coordinator. SMC 6.310.735.F.2, 3. If an EDR is certified through this process, the Ordinance requires the EDR and driver coordinator to meet and negotiate in good faith regarding certain subjects, including “best practices regarding vehicle equipment standards; safe driving practices; the manner in which the driver coordinator will conduct criminal background checks of all prospective drivers; the nature and amount of payments to be made by, or withheld from, the driver coordinator to or by the drivers; minimum hours of work, conditions of work, and applicable rules.” SMC 6.310.735.H.1. If the parties reach agreement on terms, they must submit their proposed agreement to the Director, who reviews it for compliance with the Ordinance “and 2 Under the Ordinance, the Director establishes the specific conditions that a driver must satisfy to be designated a “qualifying driver.” SMC 6.310.110; see also Director’s Rule FHDR-1 (Director’s rule specifying conditions) (Addendum A-36). 7 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 17 of 117 to ensure the substance of the agreement promotes the provision of safe, reliable, and economical for-hire transportation services and otherwise advance[s] the public policy goals set forth in [the Ordinance].” SMC 6.310.735.H.2. In conducting that review, the Director has the authority to gather evidence, including by holding public hearings or requesting information from the EDR or driver coordinator. Id. If the Director approves the agreement, it becomes final and its terms must be applied to all drivers with whom the driver coordinator contracts. SMC 6.310.735.H.2.a. If the Director does not approve the agreement, the Director must provide the parties with a written explanation of the agreement’s inadequacies, and may offer recommendations for remedying those inadequacies. SMC 6.310.735.H.2.b. The Ordinance specifies that no agreement can take effect until the Director affirmatively determines that it complies with the Ordinance and promotes the City’s policy goals. SMC 6.310.735.H.2.c. If the parties are unable to reach agreement within 90 days of the EDR’s certification, either party may demand interest arbitration, through which a neutral interest arbitrator will consider the parties’ positions and recommend “the most fair and reasonable agreement” concerning the specified subjects of negotiation. SMC 6.310.735.I. An interest arbitrator’s recommendation is subject to the same Director review process as a proposed agreement negotiated by the parties. SMC 6.310.735.I.3. 8 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 18 of 117 The implementing rules add as a mandatory subject of negotiations “[w]hether for-hire drivers will be required to become members of or make other payments to an EDR.” Director’s Rule FHDR-4 (Addendum A-44). But the Ordinance specifies that its terms do not “require or preclude a driver coordinator from making an agreement with an EDR to require membership of for-hire drivers,” SMC 6.310.735.H.4, and the rules elaborate that “[w]hether for-hire drivers will be required to become members of or make other payments to an EDR … will not be submitted to interest arbitration unless both the Driver Coordinator and the EDR agree to that submission.” Director’s Rule FHDR-4. Thus, the parties are not required to reach any agreement to include such a provision, and no provision regarding that subject may be imposed through interest arbitration. 3 After an agreement takes effect, any proposed amendments must be submitted for Director approval under the same procedures and standards governing approval of the original proposed agreement. SMC 6.310.735.J. The Director has the authority to withdraw approval of an agreement during its term should he determine that it no longer promotes the policy goals specified in the Ordinance. SMC 6.310.735.J.1. The Ordinance took effect on January 22, 2016. ER 108 (¶23). Teamsters 3 Amicus Pacific Legal Foundation (“PLF”) is therefore wrong in suggesting that the Ordinance “empowers unions to demand mandatory union dues and agency shop fees.” PLF Br. at 21. 9 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 19 of 117 Local 117 (“Local 117”) applied for status as a QDR on February 13, 2017, and was certified as a QDR on March 3, 2017. ER 113 (¶¶43-45). II. Litigation history On March 9, 2017, the Chamber of Commerce of the United States filed a federal court action challenging the Ordinance and sought a preliminary injunction. Chamber of Commerce v. Seattle, No. C17-0370RSL, ECF Dkt. ##1, 2 (W.D. Wash. Mar. 9, 2017). On March 10, 2017, Plaintiffs filed the instant case and their own preliminary injunction motion. See ER 135. Plaintiffs are current or former drivers for Uber and Lyft, two of the companies subject to the Ordinance. ER 105-08 (¶¶919). On April 4, 2017, the District Court granted a preliminary injunction enjoining the Ordinance’s disclosure requirements in the Chamber of Commerce case. Chamber of Commerce v. Seattle, No. C17–0370RSL, __ F.Supp.3d __, 2017 WL 1233181 (W.D. Wash. Apr. 4, 2017).4 As relevant here, the District Court, on a preliminary basis, rejected Plaintiffs’ First Amendment claim as unripe and their NLRA claims as both unripe and lacking merit. Id. at *5-6 & n.6, *8. The City thereafter moved to dismiss Plaintiffs’ claims under Federal Rules of Civil Procedure 12(b)(1) and 12(b)(6), arguing that their claims were not ripe and failed on their merits. On August 24, 2017, the District Court granted the City’s 4 Although the District Court’s order was issued in the Chamber of Commerce case, it addressed the motion for preliminary relief in this case as well. 10 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 20 of 117 motion in all respects. With respect to Section 8(b)(4) of the NLRA, the Court held that the claim would be ripe only if all of the following events occurred: (a) a QDR obtains majority support and is designated as the EDR of for-hire drivers for Uber or Lyft, (b) the EDR attempts to negotiate a contract requiring drivers of that driver coordinator to become members of the EDR, and (c) “such efforts could reasonably be viewed as a threat, coercion, or restraint on the named plaintiffs.” ER 10.5 Plaintiffs’ Section 8(e) claim would ripen only if all of those events occurred, and an agreement was reached whereby Uber or Lyft agreed to cease doing business with a third party, and the agreement was approved by the Director. ER 8. For the same reasons discussed in its earlier preliminary injunction order, the District Court held that, to the extent Plaintiffs’ First Amendment claim is “based on a fear that they will be forced to pay fees to the union and/or to fund speech or political activities,” that claim is similarly contingent on uncertain events and so unripe. ER 11 n.5, 13. With respect to the merits, the District Court held that Plaintiffs’ NLRA claims fail because there are no allegations that any conduct authorized or mandated by the Ordinance involves a “labor organization” as that term is defined by the NLRA, which is a prerequisite to the NLRA’s applicability. ER 9-11. The court also 5 Because Plaintiffs only drive for Uber or Lyft, any efforts by an organization to represent workers for other driver coordinators would not render Plaintiffs’ claims ripe. 11 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 21 of 117 held that Plaintiffs’ facial challenge under Section 8(e) fails as a matter of law because nothing in the Ordinance mandates that any driver coordinator enter into an agreement that would require that entity to cease doing business with anyone else. ER 9. Finally, the court rejected Plaintiffs’ claim that the Ordinance violates their First Amendment associational rights by enabling an EDR to negotiate a generally applicable contract, holding that the claim is foreclosed by longstanding Supreme Court precedent that has recently been reaffirmed by numerous courts. ER 11-13.6 SUMMARY OF ARGUMENT Plaintiffs advance claims under the NLRA and the First Amendment. But none of Plaintiffs’ claims are ripe, as they all depend on future events that may or may not occur: For any of Plaintiffs’ claims to ripen, Local 117 or another QDR would have to obtain statements of interest from a majority of Uber or Lyft’s qualifying drivers and be certified as an EDR. Given the large number of drivers that contract with Uber and Lyft and the frequent turnover among such drivers, it is highly speculative whether any entity will be able to do so. 6 The Court also dismissed Plaintiffs’ claim under the federal Driver’s Privacy Protection Act because the Ordinance does not require the disclosure of personal information protected by that statute. ER 13-14. Plaintiffs do not appeal the dismissal of that claim. 12 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 22 of 117 For purposes of Plaintiffs’ Section 8(b)(4) claim, the EDR would also have to engage in threats, coercion, or restraints intended to pressure Uber or Lyft into no longer doing business with Plaintiffs. Plaintiffs’ Section 8(e) claim would further require an EDR and driver coordinator to successfully negotiate a proposed agreement, and for that agreement (or an agreement recommended by a neutral arbitrator) to be approved by the Director. Plaintiffs’ First Amendment claim would require, at the very least, that an organization be certified as an EDR to represent Plaintiffs in negotiations with Plaintiffs’ driver coordinators. As none of those events has even allegedly occurred, the dismissal of Plaintiffs’ complaint should be affirmed on this basis alone. In any event, Plaintiffs’ claims fail on their merits, for a number of separate and independent reasons. First, the NLRA does not regulate the labor activities of independent contractors, who are expressly exempted from the scope of that statute. See Bhd. Railway Trainmen v. Jacksonville Term. Co., 394 U.S. 369, 391-92 (1969) (holding that, with respect to railway employees similar exempted from the NLRA, “there is absolutely no warrant for [applying] the panoply of detailed law developed by the National Labor Relations Board and courts under §8(b)(4)”). Sections 8(b)(4) and 8(e) prevent NLRA-covered “labor organizations”—i.e., organizations 13 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 23 of 117 representing NLRA-covered employees—from engaging in certain conduct designed to pressure neutral third parties into ceasing their business with a person or entity involved in an NLRA-covered labor dispute. These NLRA provisions do not apply to organizations representing independent contractors excluded from NLRA coverage, like an entity designated as a QDR or EDR under the Ordinance. Second, even if some conduct undertaken by entities subject to the Ordinance could violate Sections 8(b)(4) or 8(e), the Ordinance itself does not require or authorize anyone to engage in such conduct, and so would not itself be facially preempted by the NLRA. Third, even if the NLRA applies, the conduct authorized or mandated by the Ordinance would not violate the NLRA, because it seeks to advance drivers’ interests vis-à-vis their driver coordinator, rather than targeting a neutral party with no connection to that relationship. Finally, Plaintiffs’ First Amendment claim—that merely being represented in economic negotiations by an EDR violates their right of free speech and association—has with good reason been squarely rejected by every court to consider it, including the United States Supreme Court. STANDARD OF REVIEW The City agrees that this Court generally reviews decisions granting motions to dismiss de novo. A Rule 12(b)(1) motion asserting that a district court lacked 14 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 24 of 117 subject matter jurisdiction over plaintiffs’ claims because they are not ripe, however, “can be either facial, confining the inquiry to allegations in the complaint, or factual, permitting the court to look beyond the complaint.” Savage v. Glendale Union High Sch. Dist. No. 205, 343 F.3d 1036, 1039 n.2 (9th Cir. 2003). Here, the City challenged Plaintiffs’ standing both as a facial matter, in which the court must accept as true all material allegations of fact (but need not accept bare legal conclusions), Maya v. Centex Corp., 658 F.3d 1060, 1068 & n.3 (9th Cir. 2011), and as a factual matter, which requires Plaintiffs to present evidence to support those allegations and requires the court to make findings of fact, Kingman Reef Atoll Investments, LLC v. United States, 541 F.3d 1189, 1195 (9th Cir. 2008). The District Court’s analysis of the relevant facts is reviewed for clear error. Id. To withstand a motion to dismiss under Rule 12(b)(6), a complaint must allege facts sufficient “to state a claim to relief that is plausible on its face.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007). In a facial challenge, the plaintiff must establish that the challenged law “is unconstitutional in all of its applications.” Wash. State Grange v. Wash. State Republican Party, 552 U.S. 442, 449 (2008); United States v. Salerno, 481 U.S. 739, 745 (1987) (requiring “that no set of circumstances exists under which the Act would be valid”). 15 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 25 of 117 ARGUMENT I. The District Court’s dismissal of Plaintiffs’ NLRA claims should be affirmed. The District Court dismissed Plaintiffs NLRA claims as both unripe and lacking in merit. Both rulings were correct. A. Sections 8(b)(4) and 8(e) of the NLRA limit the ability of organizations representing NLRA-covered employees to involve neutral third parties in their labor disputes. To understand why Plaintiffs’ NLRA claims are both unripe and meritless, it is important to understand the limited type of conduct regulated by the NLRA provisions at issue here. Plaintiffs’ preemption claims arise under Sections 8(b)(4) and 8(e) of the NLRA. Plaintiffs characterize those statutory provisions as creating a broad prohibition on any conduct or agreement limiting the terms under which private parties may contract with one another. In truth, however, those two provisions impose carefully circumscribed limitations on certain forms of conduct through which labor organizations representing NLRA-covered employees seek to advance their goals in NLRA labor disputes (i.e., disputes involving such employees’ terms and conditions of employment) by exerting pressure on neutral third parties not directly involved in those disputes. In general, such pressure on a neutral entity is known as a “secondary boycott.” As explained by a leading treatise: 16 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 26 of 117 In its simplest form the boycott involves a labor union; a primary employer (the party that acts, by refusal or otherwise, contrary to the desires of the union); a secondary employer (the party that is neutral or at least not actually performing the act the union is contesting); and, frequently, secondary employees (who are encouraged to respond sympathetically to the union’s objectives). A union engaged in a secondary boycott employs economic coercion in an attempt to involve a neutral in the dispute between the union and the primary employer. 2 The Developing Labor Law 22-7–22-8 (7th ed. 2017) (quoting Frankfurter & Greene, The Labor Injunction 43 (1930)) (footnote omitted; emphasis in original). 7 Crucially, only some secondary activity is unlawful. See 2 The Developing Labor Law 22-3 (“Congress has prohibited some, but far from all, forms of secondary strikes and picketing.”). For example, “most peaceful handbilling— whether primary or secondary—is either protected by the [NLRA] … or not prohibited by it.” Id. The two NLRA prohibitions relevant to this case—Sections 8(b)(4) and 8(e), 29 U.S.C. §§158(b)(4), 158(e)—are set forth in the NLRA’s definitions of certain “unfair labor practices” by employers and labor organizations. 8 Section 8(b)(4) 7 Thus, for example, a labor organization representing NLRA-covered employees engages in secondary activity if it tries to convince a paper mill not to sell its product to a newspaper whose staff the labor organization is seeking to organize. In this example, the labor organization is seeking to use the “neutral” or “secondary” employer—the paper mill—to gain leverage in its dispute with the “primary” employer—the newspaper. 8 Plaintiffs’ first and second claims are premised on Sections 8(b)(4) and 8(e), while Plaintiffs’ third claim is based on both statutes’ prohibition of secondary activity. 17 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 27 of 117 makes it an unfair labor practice for a “labor organization” to, inter alia, “threaten, coerce, or restrain” any person engaged in commerce in order to force them to cease doing business with another person or to force them to enter into an agreement prohibited by Section 8(e). 29 U.S.C. §158(b)(4)(ii)(A) & (B). The statutory provision expressly excludes from its prohibitions “any primary strike or primary picketing,” 29 U.S.C.§158(b)(4)(i)(B), thus clarifying that it does not regulate conduct directed at an entity that has an interest in the relevant dispute. The Supreme Court has warned against construing Section 8(b)(4)’s prohibition broadly. The terms “threats, coercion, or restraints,” as used in Section 8(b)(4), “should be interpreted with ‘caution’ and not given a ‘broad sweep,’” Edward J. DeBartolo Corp. v. Florida Gulf Coast Bldg. & Constr. Trades Council, 485 U.S. 568, 578 (1988) (quoting NLRB v. Drivers Local Union No. 639, 362 U.S. 274, 290 (1985)). For example, “mere persuasion” without “intimidation,” id. at 580, does not run afoul of the statute. Section 8(e) makes it an unfair labor practice for a “labor organization” and an “employer” to enter an agreement “whereby such employer ceases or refrains or agrees to cease or refrain from handling, using, selling, transporting or otherwise dealing in any of the products of any other employer, or to cease doing business with Because the statutes only prohibit secondary activity, however, Plaintiffs’ third claim is superfluous. 18 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 28 of 117 any other person ....” 29 U.S.C. §158(e). Section 8(e) was intended to outlaw socalled “hot cargo agreements,” which were “provisions in collective bargaining agreements providing that covered employees need not handle nonunion, unfair, or struck goods of other employers.” 2 The Developing Labor Law 23-2. The two provisions complement each other: Section 8(b)(4) prohibits certain forms of coercive pressure intended to force a neutral employer to cease doing business with a primary employer or to enter into a hot cargo agreement, while Section 8(e) separately prohibits such agreements. Thus, for example, Section 8(b)(4) prohibits a labor organization’s picket of a rental car company in order to force it to cease doing business with an electrical subcontractor with whom the union has a labor dispute. NLRB v. Local 3, Int’l Bhd. of Electrical Workers, 471 F.3d 399, 402-03 (2d Cir. 2006). 9 Similarly, a contract in which an employer agrees to work only with subcontractors that have a current collective bargaining agreement with 9 Picketing may be considered coercive because it “is a mixture of conduct and communication. In the labor context, it is the conduct element rather than the particular idea being expressed that often provides the most persuasive deterrent to third persons about to enter a business establishment.” NLRB v. Retail Store Emp. Union, Local 1001, 447 U.S. 607, 619 (1980) (Stevens, J., concurring); see Overstreet v. United Bhd. of Carpenters, Local Union No. 1506, 409 F.3d 1199, 1210 (9th Cir. 2005) (“The physical conduct of picketing involves patrol of a particular locality and the mere presence of a picket line induces certain actions— namely, refusing to cross that line.”) (quotation marks and citation omitted; emphasis in original). 19 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 29 of 117 the union violates Section 8(e). See, e.g., Connell Constr. Co. v. Plumbers Local Union No. 100, 421 U.S. 616, 619-20 (1975). Plaintiffs contend that the Ordinance is preempted by Sections 8(b)(4) and 8(e) because it enables independent contractor drivers to negotiate collectively through an EDR and to attempt to reach an agreement with a driver coordinator that, if approved by the Director, governs the contracting terms and conditions for all such drivers providing services for that driver coordinator. Through this process, Plaintiffs contend, the Ordinance enables an EDR to pressure driver coordinators to “cease doing business” with drivers who refuse to accept the EDR’s representation, or refuse to work under the negotiated terms. But as explained in section I.B infra, Plaintiffs’ claims are unripe because there is no imminent likelihood that any EDR will be certified, let alone that any EDR will enter into an agreement with a driver coordinator for whom Plaintiffs provide driving services. And, in any event, as explained in Section I.C infra, none of the conduct authorized or mandated by the Ordinance is even arguably prohibited by Sections 8(b)(4) or 8(e), which do not apply to activities undertaken solely by non-NLRA-covered workers and their representatives and do not prohibit conduct or agreements targeting non-neutral “primary” entities like Uber and Lyft. 20 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 30 of 117 B. Plaintiffs’ NLRA claims are not ripe. “[R]ipeness can be characterized as standing on a timeline.” Thomas v. Anchorage Equal Rights Comm’n, 220 F.3d 1134, 1138 (9th Cir. 2000) (en banc). “A claim is not ripe for adjudication if it rests upon contingent future events that may not occur as anticipated, or indeed may not occur at all.” Texas v. United States, 523 U.S. 296, 300 (1998) (internal quotation marks omitted). A plaintiff has the burden to demonstrate standing and ripeness. Chandler v. State Farm Mut. Auto. Ins. Co., 598 F.3d 1115, 1121-22 (9th Cir. 2010). Here, as the District Court recognized, Plaintiffs’ NLRA preemption claims all depend upon events that have not occurred and may well never occur—including a QDR’s success in procuring majority support from Uber or Lyft’s qualifying drivers, the QDR being certified as an EDR, and the subsequent negotiation and City approval of an agreement establishing the contracting terms and conditions for their drivers. ER 8-10; see ER 113 (¶¶44-45) (alleging that a union has been certified as a QDR, which means only that it is authorized to demand a list of qualifying drivers and begin seeking the support necessary to be certified as an EDR). For that reason, the claims are not ripe, and neither the District Court nor this Court may exercise Article III jurisdiction over those claims. The fact that no EDR has been certified as a representative of Uber or Lyft’s drivers (or of any other group of drivers) is fatal to Plaintiffs’ Section 8(b)(4) claim. 21 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 31 of 117 Plaintiffs have not, and cannot, allege that any activity that could be characterized as involving unlawful “threats, coercion, or restraints” has occurred. Plaintiffs’ central argument under Section 8(b)(4) is that, by simply permitting a system allowing for exclusive representation, the Ordinance “coerces” driver coordinators to cease doing business with Plaintiffs and others who do not wish to be represented by the EDR or subject to the terms negotiated by the EDR. But because no EDR has yet been, or may ever be, certified, any 8(b)(4) challenge premised upon that theory is not ripe. In an effort to escape this fundamental problem, Plaintiffs suggest that their Section 8(b)(4) claim is ripe because one QDR’s campaign to organize drivers has already begun. See ER 113 (¶45). But merely attempting to persuade drivers to support a QDR does not involve unlawful “threats, coercion, or restraints” prohibited by Section 8(b)(4). Notably, Plaintiffs do not allege that the QDR has engaged in any other form of threat, coercion, or restraint—let alone that the Ordinance authorizes or mandates such conduct (as it would have to in order to be preempted by Section 8(b)(4)). See In re United Bhd. of Carpenters, Local Union No. 1506, 355 NLRB 797, 800 (2010) (“coerce” and “restrain” require more than “mere persuasion,” and instead include such conduct as “violence, intimidation, blocking ingress and egress, or similar direct disruption of the secondaries’ business”) (quotation marks and citation omitted); Edward J. DeBartolo Corp., 485 U.S. at 578 22 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 32 of 117 (no unlawful threats, coercion or restraints where there was “no violence, picketing, or patrolling”). As the District Court concluded, “[w]hether the Teamsters will be designated as the representative of any group of for-hire drivers, whether it will attempt to negotiate a union shop provision with the driver coordinator, and whether such efforts could reasonably be viewed as a threat, coercion, or restraint on the named plaintiffs have yet to be seen.” ER 10. Notwithstanding the Supreme Court’s admonition to the contrary, see supra at 18, Plaintiffs argue that “coercion” should be construed broadly. Their arguments, however, do not establish that any conduct that could even arguably be characterized as “coercion” within the meaning of Section 8(b)(4) is actually occurring or imminent. Plaintiffs contend, for example, that the Ordinance will effectively enable an (as yet uncertified) EDR to exert coercive force through the City, which it contends is prohibited by Section 8(b)(4). AOB 26-27. But again, that argument depends upon the certification of an EDR, and even under their own theory Plaintiffs cannot cite anything in the Ordinance that requires any driver or driver coordinator to cease doing business with any other entity, or to alter the terms on which they do business, in the absence of EDR certification. 10 10 In arguing that they may premise their Section 8(b)(4) claim on coercion applied by the City, Plaintiffs rely upon the 1959 amendments to the NLRA, see AOB 2627, but those amendments do not support their claims. Before 1959, the NLRA made 23 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 33 of 117 Next, Plaintiffs contend that the Ordinance’s requirement that a driver coordinator apply the terms of any contract with an EDR to all of its drivers constitutes “coercion” within the meaning of Section 8(b)(4). See AOB 21. As explained below, this argument fails on its merits. See Section I.C infra. But yet again, Plaintiffs cannot allege that any EDR has been certified or has entered into a contract with a driver coordinator. Because no such purported “coercion” can exist it an unfair labor practice for a labor organization “to induce or encourage the ‘employees of any employer’ to engage in a strike or certain other concerted activities where an object of such conduct was forcing or requiring any employer or other person to cease doing business with any other person.” Local 3, Int’l Bhd. of Electrical Workers, 244 NLRB 357, 358 (1979) (emphasis added). Because this was construed to apply only to NLRA-covered employees, “unions lawfully could enlist the aid of nonstatutory agricultural, governmental, railroad, or airline employees to carry out secondary boycotts” in support of NLRA-represented employees. Local 3, 244 NLRB at 358. To close this loophole, Congress replaced “employees of any employer” with “any person.” Id. at 359. Thus, after 1959, public employees could no longer lawfully be enlisted to carry out secondary boycotts. But the NLRA’s post1959 prohibition on such secondary boycotts by public employees to affect NLRA labor disputes in no way suggests that a generally applicable law or regulation duly enacted by a local government may constitute unlawful coercion simply because it affects certain business relationships. Far from suggesting that Section 8(b)(4) applies to such government conduct, the Supreme Court has made it clear that the proper question when a local government enacts such a law or regulation is whether Congress meant for the type of conduct at issue to be left to the “free play of economic forces”—a type of preemption that does not apply in cases like this involving only NLRA-exempt workers. Golden State Transit Corp. v. City of Los Angeles, 475 U.S. 608, 613-14 (1986) (quotation omitted) (where city refused to renew taxicab company’s operating franchise unless it settled dispute with union, “the second pre-emption principle, the so-called Machinists pre-emption” provides proper mode of analysis). 24 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 34 of 117 absent EDR certification, Plaintiffs cannot rely upon that theory of coercion to establish a ripe 8(b)(4) claim. Associated General Contractors of California, Inc. v. NLRB, 514 F.2d 433 (9th Cir. 1975), relied upon by Plaintiffs, AOB 14-17, is not to the contrary. In that case, an existing multiemployer collective bargaining agreement authorized a labor organization to obtain fines against a subcontractor that had been required to install certain nonunion equipment under its agreement with the general contractor. This Court held that enforcing the contract against the subcontractor was “coercive” within the meaning of Section 8(b)(4), because it forced the subcontractor to change its business practices. Id. at 439. Here, by contrast, no EDR has been certified and no contract has been negotiated or approved, so there is no existing violation of the sort at issue in Associated General Contractors.11 If any unlawful coercion or threats do ultimately occur during a QDR’s organizing campaign, Plaintiffs’ complaint will be with the QDR, not the Ordinance, as the implementing rules prohibit QDRs from “interfer[ing] with, restrain[ing], or coerc[ing] drivers in their exercise of their right[s]” under the Ordinance. Director’FHDR-2 (Addendum A-39). 11 Plaintiffs emphasize that Section 8(b)(4) may be violated even where a labor organization has failed to obtain the goals of its unlawfully coercive conduct. But the statute is only violated where there has, in fact, been unlawfully coercive conduct, and Plaintiffs have not alleged any facts that would establish unlawful coercion here. 25 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 35 of 117 Notwithstanding the future contingences upon which their claims depend, Plaintiffs contend that American Trucking Associations, Inc. v. City of Los Angeles, 559 F.3d 1046 (9th Cir. 2009), establishes that their claims are ripe. In American Trucking Associations, however, the members of the plaintiff trucking association were presently subject to a requirement that they either agree to certain terms for conducting their business at two ports or lose access to those ports altogether. See id. at 1051-52, 1058. This Court held that agreeing to those terms would require them to change the “whole nature of [their] business in ways that most likely cannot be compensated with damages alone.” Id. at 1058. Here, Plaintiffs have not and cannot demonstrate that the Ordinance currently presents any Plaintiff with the choice of losing his or her business or irremediably changing the nature of their business. The immediate harm at issue in American Trucking Associations simply does not exist here. Further, Plaintiffs’ Section 8(e) claim is blantantly unripe on its face. As the plain language of the statute indicates, the sine qua non of a Section 8(e) violation is an agreement. See 29 U.S.C. §158(e) (prohibiting a hot cargo “contract or agreement”). Plaintiffs have not and cannot allege that any agreement exists between any EDR and any driver coordinator, much less one with terms that run afoul of the statute. As there is no certified EDR, there certainly cannot be a proposed agreement reached with a driver coordinator or recommended by an interest arbitrator and 26 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 36 of 117 approved by the Director. None of these events has taken place. Given these contingencies, the District Court was appropriately “loath to offer an advisory opinion or to declare rights in a hypothetical case” arising under Section 8(e). ER 8.12 In any event, whether any hypothetical future coercive conduct or agreement would be intended to target a neutral entity (which is all that matters under Sections 8(e) and 8(b)(4), see NLRB v. Int’l Bhd. of Teamsters, Local 251, 691 F.3d 49, 56 (1st Cir. 2012); Section I.C.3 infra) involves a question of fact that plainly cannot be resolved in the absence of any actual pressure, negotiations, or agreement, and so is unripe for resolution at this time. Plaintiffs also assert that they will suffer imminent harm from the disclosure of their personal information. AOB 34. However, Plaintiffs’ legal challenge is to the provisions of the Seattle Municipal Code that provide for exclusive representation and a uniform agreement; Plaintiffs make no argument that the mere requirement that Uber and Lyft disclose of a list would somehow violate or be preempted by 12 Plaintiffs contend that the District Court’s ripeness analysis misapprehended their claim as relying on the consummation of an agreement requiring that all drivers become members of an EDR. AOB 9. As the District Court pointed out, Plaintiffs’ NLRA claims might be ripe if this occurred. But even if Plaintiffs’ Section 8(e) claim does not depend upon the existence of an agreement requiring membership in an EDR, it requires, at a minimum, the existence of an agreement or contract of some kind, and Plaintiffs have failed to allege (and could not allege) that any such agreement or contract has been negotiated or taken effect. 27 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 37 of 117 Sections 8(b)(4) or 8(e). Because a plaintiff “must demonstrate standing,” including ripeness, “for each claim he seeks to press and for each form of relief that is sought,” Davis v. FEC, 554 U.S. 724, 734 (2008) (quotation omitted), Plaintiffs cannot claim that their challenge to the exclusive representation provisions of the Ordinance are ripe based on an injury caused by a different provision of the Ordinance.13 In any event, any privacy injury here is nonexistent, because Plaintiffs have already revealed their status as drivers for Uber and Lyft, as well as whether they are “qualifying drivers,” and all other information that would appear on a list is already publicly accessible.14 Finally, even if Plaintiffs were able to show a constitutional injury, they would fail to satisfy the “prudential” component of ripeness doctrine, which is guided by two overarching considerations: “the fitness of the issues for judicial decision and 13 Davis held that a plaintiff had standing to challenge a disclosure provision of the McCain-Feingold Act, but not to challenge a different provision of the same Act that would not itself have injured him. 554 U.S. at 733-35. Here, similarly, Plaintiffs’ purported privacy injury would result from the operation of SMC 6.310.735.D (requiring production of a list), but their NLRA claims target SMC 6.310.735.F (providing for EDR certification) and 6.310.735.H (requiring negotiations with a certified EDR). 14 Plaintiffs did not file this case as a class action, and so cannot show injury based on disclosure of other drivers’ information. For-hire drivers must obtain business licenses to operate in the City of Seattle. SMC 6.208.010, 6.310.130.F. For-hire driver business licensees can be searched online at http://www.seattle.gov/licenses/find-a-business, to generate the name, address, and phone number or any driver holding a business license. See also D. Ct. Dkt. #31-2 at 3-5, 12-13, 19, 21. 28 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 38 of 117 the hardship to the parties of withholding court consideration.” Abbott Labs. v. Gardner, 387 U.S. 136, 149 (1967), abrogated on other grounds by Califano v. Sanders, 430 U.S. 99 (1977) (holding that constitutionally ripe claim must still satisfy prudential ripeness component); Bishop Paiute Tribe v. Inyo County, 863 F.3d 1144, 1153 (9th Cir. 2017) (same). Here, where it is unknown whether Local 117 or any other QDR will seek statements of interest from a majority of Uber or Lyft’s drivers, whether a QDR will engage in conduct prohibited by Section 8 in doing so, whether any QDR will succeed in obtaining majority support and becoming certified as an EDR, and whether any agreement between an EDR and Uber or Lyft will be reached and approved, the issues are not fit for judicial decision. Nor will delaying resolution of those issues cause plaintiffs hardship, particularly given that there is no real privacy intrusion. See supra at 28 & n.14. Accordingly, the Court should affirm the dismissal of Plaintiffs’ NLRA claims as unripe. C. Plaintiffs’ NLRA claims fail on the merits. Even if Plaintiffs’ NLRA claims were ripe, they would fail on their merits. To succeed in a facial challenge to the Ordinance, Plaintiffs must show that “no set of circumstances exists under which the [Ordinance] would be valid.” Salerno, 481 U.S. at 745. Under San Diego Building Trades Council v. Garmon, 359 U.S. 236 (1959), a plaintiff claiming NLRA preemption must establish that the conduct 29 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 39 of 117 regulated by state or local law is “arguably” protected or prohibited by federal labor law. This “mean[s] that the party claiming pre-emption is required to demonstrate that his case is one that the [National Labor Relations] Board could legally decide in his favor.” Int’l Longshoremen’s Ass’n, AFL-CIO v. Davis, 476 U.S. 380, 394–95 (1986); see also id. at 394 (test for determining whether conduct is “arguably” protected or prohibited “is not without substance”). Thus, to succeed, Plaintiffs must (a) advance an interpretation of the NLRA that is not contrary to its language and has not been rejected by the courts or the National Labor Relations Board (“NLRB”), id.; (b) set forth sufficient factual allegations that, if believed, would “enable the court to find that the Board reasonably could uphold a claim based on such an interpretation,” id.; and (c) establish that those facts are the same with respect to all possible applications of the Ordinance. Plaintiffs fail to meet these requirements for at least three reasons, each of which highlights Plaintiffs’ attempt to shoehorn their challenge to an Ordinance governing only NLRA-exempt independent contractors into federal labor doctrines that regulate tactics by organizations representing NLRA-covered employees in NLRA-covered labor disputes, and that do not apply to such independent contractors. As explained below, Plaintiffs’ claims fail because (a) independent contractors and any QDR or EDR representing them are not subject to the NLRA’s prohibitions, (b) nothing about the Ordinance requires anyone to cease doing business with anyone 30 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 40 of 117 else, and (c) an EDR’s advocacy on behalf of drivers regarding the terms and conditions of their work for a particular driver coordinator would be lawful primary conduct, rather than unlawful secondary conduct. 1. The NLRA does not apply to disputes solely involving NLRA-exempt workers and their representatives. Most fundamentally, Plaintiffs’ NLRA preemption claims fail because the NLRA does not, and was never intended to, regulate the labor activities of independent contractors, who are expressly exempted from the NLRA’s coverage. See Jacksonville Term. Co., 394 U.S. at 391-92 (railway workers exempt from the NLRA not subject to its proscriptions). Thus, for example, states are free to establish their own systems to regulate the labor relations of agricultural workers who, just like independent contractors, are exempt from the NLRA. See, e.g., United Farm Workers, AFL-CIO v. Ariz. Agricultural Emp. Relations Bd., 669 F.2d 1249 (9th Cir. 1982); Gerawan Farming, Inc. v. Agric. Labor Relations Bd., __ P.3d __, 2017 WL 5662395, at *2 (Cal. Nov. 27, 2017) (“In enacting the [Agricultural Labor Relations Act], the [California] Legislature intended to fill a gap in the labor protections afforded by the federal National Labor Relations Act (NLRA), which exempts ‘any individual employed as an agricultural laborer.’”). Just as states are free to create alternative systems governing the labor relations of agricultural workers or public employees that mandate the very same forms of exclusive representation challenged as violating Sections 8(b)(4) and 8(e) 31 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 41 of 117 here, Congress’s decision to exempt independent contractors from the NLRA permits the City to adopt such a system for NLRA-exempt independent contractor drivers in the local for-hire transportation industry without running afoul of those NLRA proscriptions. To be certain, where NLRA-covered participants in an NLRAcovered labor dispute seek to involve neutral independent contractors in their dispute, Sections 8(b)(4) and 8(e) may come into play. See infra at 41-42. But where, as here, the disputes by definition involve only NLRA-exempt independent contractors, the NLRA is simply irrelevant. The plain language of the NLRA bears this out. Sections 8(b)(4) and 8(e) govern only conduct by “labor organizations,” as that term is defined in the NLRA, and that definition does not include QDRs and EDRs certified by the Director under the Ordinance. See ER 9-11. The NLRA defines “labor organizations” as organizations representing NLRA “employees,” a term that expressly excludes independent contractors. 29 U.S.C. §152(5), (3) (“employee” “shall not include … any individual having the status of an independent contractor”). Plaintiffs’ own Complaint asserts that Plaintiffs and other drivers for Uber and Lyft are independent contractors, not employees. See, e.g., ER 110, 116 (¶¶29, 51-52). And the Ordinance by its terms applies only to independent contractor drivers, not to drivers who are “employees” under the NLRA. See Ord. §6. 32 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 42 of 117 Accordingly, in representing independent contractor drivers under the Ordinance, a QDR or EDR is not a “labor organization” subject to Sections 8(e) and 8(b)(4). See Pac. Maritime Assoc. v. Local 63, Int’l Longshoremen’s Union, 198 F.3d 1078, 1081 (9th Cir. 1999) (local union representing public employees excluded from NLRA definition of “employees” was not “labor organization” covered by Section 8(b)(4)). Even if a particular QDR or EDR happens to represent some NLRA-covered employees in other contexts—as Local 117 purportedly does here—that does not mean that QDRs and EDRs are “labor organizations” in all circumstances, as they must be to establish the Ordinance’s facial invalidity under Plaintiffs’ NLRA preemption theory. Recognizing the weakness of their position, Plaintiffs rely upon their Complaint’s bald assertion that QDRs and EDRs are in fact “labor organizations,” ER 110 (¶32), and contend that this Court must accept that allegation as true given the procedural posture of the case, see AOB 37-38. But “labor organization” is a legal term defined in the NLRA, and Plaintiffs’ assertion that QDRs and EDRs are “labor organizations” presents a legal conclusion that can and must be disregarded. See Twombly, 550 U.S. at 555 (“[O]n a motion to dismiss, courts are not bound to accept as true a legal conclusion couched as a factual allegation[.]”) (quotation marks and citation omitted). 33 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 43 of 117 Plaintiffs also offer the tortured argument that QDRs must be “labor organizations” because QDRs and NLRA-covered labor organizations face similar requirements and have similar characteristics, such as that both must be non-profit organizations and both must give members some right of democratic control. AOB 38 & n.11. This argument ignores the fundamental and only relevant difference between the two types of entities—namely, that an NLRA-covered labor organization must represent NLRA-covered employees, while the workers represented by a QDR under the Ordinance are not NLRA-covered employees. It also ignores that a non-profit organization that does not represent NLRA-covered employees in any context may qualify for certification as a QDR. See SMC 6.310.735.B.1; FHDR-2 (Addendum A-39). With respect to Plaintiffs’ purported “as-applied” challenge, which is premised upon Local 117’s certification as a QDR and potential future certification as an EDR, Plaintiffs contend that Local 117 is a “labor organization” because it represents NLRA-covered employees in other contexts. Under this Court’s governing authority, however, where a labor organization represents both NLRAcovered employees and individuals excluded from the NLRA, the NLRA’s prohibition on unlawful secondary activity does not apply to actions taken solely in the organization’s role as representative of the excluded individuals. In Air Line Pilots Association v. NLRB, 525 F.3d 862 (9th Cir. 2008) 34 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 44 of 117 (“ALPA”), this Court held that the applicability of the NLRA’s prohibitions on certain secondary activity depends on the nature of the dispute at issue, and in particular whether the dispute involves NLRA-covered employees. ALPA considered a dispute involving a union that represented NLRA-covered employees as well as employees covered by the Railway Labor Act, and held that the NLRA’s secondary boycott provisions did not apply to the dispute at issue because none of the NLRA employee members were “in any way involved in the … case” and the dispute was “fundamentally a Railway Labor Act dispute.” Id. at 870. Similarly, here, Plaintiffs do not contend that any NLRA-covered employees Local 117 might represent in its separate capacity as an NLRA labor organization have anything to do with the conduct at issue here—Local 117’s organizing and representation of independent contractors under the Ordinance. Under ALPA, Local 117’s representation of NLRA-covered employees in unrelated contexts does not make Section 8 applicable to any conduct it might undertake solely in its role as the representative of NLRA-exempt independent contractors. ER 10 (ALPA holds “that where the NLRA-covered union members are not involved in a particular dispute, the NLRA does not apply”).15 15 Marriott Corp. v. NLRB, 491 F.2d 367 (9th Cir. 1974), relied upon by Plaintiffs, AOB 39, is clearly distinguishable, because the dispute in that case involved an NLRA-covered employer and its employees as well as an NLRA-exempt employer and its employees, and related to employment conditions affecting the NLRA35 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 45 of 117 Plaintiffs attempt to distinguish ALPA and other cases on the ground that the unions were acting under lawful (i.e., non-preempted) federal or state labor statutes. AOB 40. But this is classic circular reasoning. That the EDR is a “labor organization” is a necessary premise for Plaintiffs’ contention that the Ordinance is preempted; otherwise Sections 8(b)(4) and (e) do not apply. Plaintiffs cannot reason from their unfounded conclusion—that the Ordinance is preempted—to obtain that premise. Plaintiffs also suggest that Marine Engineers Beneficial Association v. Interlake Steamship Co., 370 U.S. 173 (1962), held that a union representing some NLRA-covered employees and some non-NLRA-covered employees is a “labor organization” for all purposes. But Marine Engineers did no such thing. To the contrary, the Court expressly declined to decide whether the union there was a “labor organization,” id. at 180, and merely held that where prior NLRB determinations showed that a particular union could reasonably be deemed a “labor organization,” state courts should defer to the NLRB rather than apply state law to enjoin arguably protected conduct, id. at 178. Because it was unclear which of the union members at issue were NLRA-exempt “supervisors” and which, if any, were NLRA-covered covered employees. Id. at 370. No similar interaction with NLRA-covered employees exists here. 36 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 46 of 117 employees, the Court concluded that the Board’s determinations should be given deference. Id. at 182-83 & n.15. No such ambiguities exist in this case, where Plaintiffs concede—and in fact affirmatively allege—that all drivers covered by the Ordinance are NLRA-exempt independent contractors. ER 110 (¶29). Under ALPA, a QDR or EDR that represents such workers is not subject to Section 8 when acting in its capacity as their representative, and there are no ambiguities with respect to the QDR or EDR’s activities that might warrant deference to the NLRB under Marine Engineers. Accordingly, the plain language of the NLRA, as well as this Court’s decision in ALPA, confirm that Sections 8(b)(4) and 8(e) are entirely inapplicable to representational activities solely involving NLRA-exempt workers, such as the independent contractor drivers covered by the Ordinance. 2. The Ordinance does not require or coerce anyone to cease doing business with anyone else. Even if Sections 8(b)(4) and 8(e) were arguably applicable here, Plaintiffs’ NLRA claims would fail for a second, independent reason: nothing in the Ordinance even arguably requires that a driver coordinator cease doing business with any drivers, or threatens, coerces, or restrains anybody to attain such an objective. If an EDR is ever certified for Uber or Lyft drivers, those companies will remain entirely free to do business with any driver of their choosing—they will simply be required to negotiate with the EDR regarding certain contractual terms of their relationships 37 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 47 of 117 with their drivers and to abide by the agreed-upon terms in their contracts with all drivers if those terms are approved by the Director. Once the Director makes the unilateral regulatory decision to approve those terms, they are no different from other conditions imposed by the government on particular working relationships, such as the requirement that employers pay a minimum wage or that contractors require their subcontractors to pay prevailing wages. Such conditions do not result from threats, coercion, or restraints that could even arguably give rise to a claim under Sections 8(b)(4) or 8(e). Thus, the Ordinance does not restrict for-hire drivers’ freedom to do business with any driver coordinator. Drivers remain entirely free to work with the driver coordinator of their choosing, and vice versa. Just as drivers who do not want to work under the terms now established unilaterally by Uber or Lyft may decline to drive for those companies, drivers who do not want to work under the terms approved by the Director can freely elect not to do so. A driver’s willingness to “accept [the] Teamsters’ [or any other QDR’s] representation,” AOB 7, is wholly irrelevant. The Ordinance does not require that drivers become members of, or financially support, an EDR, or that they sign a collective bargaining agreement with any EDR; it merely requires the driver coordinator to apply the same terms to all drivers who drive for its service, while permitting each individual driver to decide whether to accept those terms and work for that coordinator. 38 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 48 of 117 In this respect, the Ordinance does not bring about any change in the current state of affairs. The Ordinance is premised upon the City Council’s understanding that the current practice of for-hire companies like Uber and Lyft is to apply unilaterally established terms and conditions to their drivers who provide a particular kind of ride service. Ord. §1.E; see also, e.g., Cotter v. Lyft, Inc., 60 F.Supp.3d 1067, 1080 (N.D. Cal. 2015) (stating that individual drivers cannot negotiate with Lyft regarding percentage of each fare Lyft retains as administrative fee); O’Connor v. Uber Tech., Inc., 82 F.Supp.3d 1133, 1144 (N.D. Cal. 2015) (noting that price paid by consumer for any given Uber ride “is set by Uber, without negotiation or input from the drivers”). While the Ordinance changes the process through which those terms and conditions are set—by giving drivers a voice—it does not require any driver coordinator to terminate its relationship with any driver. Just as at the present time, each individual driver remains free to accept or reject the driver coordinator’s specified terms. That those terms come from the collective voice of drivers through negotiations with Uber, as opposed to from Uber unilaterally, does not amount to coercion. To the extent Plaintiffs contend that the Ordinance requires conduct that arguably violates Section 8(e) simply because driver coordinators must apply the terms of any Director-approved agreement to all of a driver coordinator’s drivers, and not merely to drivers who choose to become members of the EDR, Plaintiffs’ 39 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 49 of 117 argument fails as a matter of law even if Section 8(e) could apply to such non-NLRA regulated conduct (which it does not, as explained above). Section 8(e) renders unlawful specific contractual terms requiring a person to cease doing business with another, not the mere negotiation of uniform terms and conditions for a particular group of workers represented by a designated exclusive representative. Indeed, bargaining by a designated representative on behalf of all similarly situated employees is the essence of what the NLRA encourages, not what it prohibits. See 29 U.S.C. §151 (declaring it to be the policy of the United States to “encourage[e] the practice and procedure of collective bargaining”). Indeed, the NLRB has long rejected Section 8(b)(4) or 8(e) challenges to “union standards” clauses in collective bargaining agreements, even though such clauses apply uniform terms and conditions to workers outside the represented bargaining unit. Such clauses require an employer to subcontract only with others who agree to abide by union-negotiated wages and benefits. They “remove the incentive for an employer to give bargaining unit work to subcontractors,” and are lawful “[b]ecause the pressure generated by such an agreement is focused upon the primary employer” and intended to benefit the workers represented by the union. Int’l Bhd. of Teamsters, Local 251, 691 F.3d at 57. “The touchstone” of such agreements “is whether the agreement or its maintenance is addressed to the labor relations of the contracting employer vis-à-vis his own employees.” Nat’l Woodwork 40 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 50 of 117 Mfrs. Ass’n v. NLRB, 386 U.S. 612, 645 (1967). Although a subcontractor might forgo work rather than agreeing to comply with a union wage scale, that cease-doingbusiness effect does not render such clauses unlawful under Sections 8(b)(4) or 8(e). Similarly here, even if some drivers might choose not to work for Uber or Lyft because they do not want to be subject to any Director-approved agreement’s terms, that fact does not render the Ordinance (or any agreement under the Ordinance) arguably unlawful under the NLRA. The requirement that negotiated terms apply uniformly is designed to improve the working conditions of the represented drivers, both directly and by preventing driver coordinators from shifting work to unrepresented drivers willing to accept lesser terms and conditions, and is thus comparable to the union standards clauses repeatedly upheld under Section 8(e) and completely consistent with the basic purposes of the NLRA. To be certain, in contrast to such lawful union standards clauses, so-called “union signatory” clauses requiring that an employer work only with subcontractors whose employees join the union are sometimes invalid under Sections 8(b)(4) and 8(e) (where those provisions apply). See In re Bituminous Coal Wage Agreements, 756 F.2d 284, 289-90 (3d Cir. 1985) (contrasting union standards and union signatory clauses). The authorities relied upon by Plaintiffs involve such attempts to pressure a neutral party to require that particular unrepresented individuals or entities join or contract with a union. See, e.g., NLRB v. Chauffeurs Local 525, 773 F.2d 41 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 51 of 117 921, 924 (7th Cir. 1985) (“The clauses at issue here, which require owner-operators to join the Union by requiring them to be carried on the payroll as employees, are union signatory clauses which focus on the union affiliation of, rather than the compensation paid, a subcontractor’s employees.”) (emphasis added); HERE Local 274, 326 NLRB 1058, 1058 (1998) (concluding that agreement “amounts to a unionsignatory clause and is therefore unlawful”); Jt. Council of Teamsters No. 42, 248 NLRB 808, 817 (1980) (“The evidence further shows that Respondent Local 420 … coercively insisted that Irvine cease doing business with independent contractors who were not and would not become members of Local 420.”) (emphasis added); see also NLRB v. Hotel & Rest. Employees Union Local 531, 623 F.2d 61, 67 (9th Cir. 1980) (union threatened to strike to enforce agreement that employer not lease operation to those who refuse to sign union contract).16 No such union-membership requirements are at issue here. While an implementing rule of the Ordinance requires driver coordinators to discuss the possibility of a membership requirement if that issue is raised by an EDR, the 16 In those cases, the pressure was not exerted on behalf of workers represented by the union to advance their interests vis-a-vis the primary employer, but against neutral third parties in order to secure the union membership of the primary employers’ employees. Nothing in the Ordinance challenged here authorizes or mandates such pressure against or agreements with neutral third parties, or requires any driver coordinator to refrain from contracting with drivers who refuse to join an EDR. 42 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 52 of 117 Ordinance and implementing rules make clear that a driver coordinator may not be required to agree to such a provision, and there is no reason to believe that such a provision will be agreed to by the contracting parties or approved by the Director. See SMC 6.310.735.H.4; FHDR-4 (Addendum A-44). And even if an EDR and a driver coordinator were to agree to unlawful contractual terms, the appropriate remedy would be to nullify the offending terms, not the Ordinance itself. See 29 U.S.C. §158(e) (“any contract or agreement entered into heretofore or hereafter containing [an unlawful Section 8(e) provision] shall be to such extent unenforcible”). Indeed, where Sections 8(b)(4) and 8(e) apply, the NLRA provides specific remedies directed at the labor organization itself. See, e.g., 29 U.S.C. §160(a); 29 U.S.C. §160(l) (requiring NLRB regional office to seek preliminary injunctive relief for violations of Sections 8(b)(4) or 8(e)); 29 U.S.C. §187(b) (providing private right of action for damages to persons injured by Section 8(b)(4) violation).17 Plaintiffs’ speculation that parties subject to the Ordinance might engage in such conduct provides no basis for invalidating the Ordinance itself. Nothing prevents an EDR and driver coordinator from agreeing to terms that violate any 17 Plaintiffs point out that under 29 U.S.C. §160(l), the NLRB may seek to enjoin certain unfair labor practices, AOB 35-36, but ignore that such actions target the conduct of NLRA-covered labor organizations or their agents, not duly-enacted municipal ordinances. 43 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 53 of 117 number of federal statutes (such as a clause that purports to waive members’ right to be free from racial discrimination), but a law is not preempted merely because it does not itself affirmatively prohibit such conduct. 3. Advancing drivers’ interests with respect to driver coordinators is not “secondary” activity. Finally, even if Plaintiffs could establish that the activities of an EDR in acting as a representative of the NLRA-exempt independent contractors are covered by the NLRA, and even if Plaintiffs could establish that the Ordinance’s requirement that Uber and Lyft apply the same contractual terms to all drivers was a “cease doing business” requirement for the purposes of Sections 8(b)(4) or 8(e), Plaintiffs still could not establish that an EDR’s conduct in representing or seeking to represent Uber or Lyft drivers would violate those provisions, because such an objective would not be “secondary” in nature. The EDR would not be using unlawful tactics to pressure a neutral or secondary target in order to influence a different, “primary” target. Instead, the EDR’s conduct would target a “primary” entity—that is, Uber or Lyft, which control the terms and conditions of the contractual relationships of drivers the EDR represents—and thus be permitted under both Sections 8(b)(4) and 8(e). As explained above, Section 8(b)(4) and Section 8(e) were intended to prevent “labor’s use of the boycott to … involv[e] an employer in disputes not his own,” Nat’l Woodwork Mfrs. Ass’n v. NLRB, 386 U.S. 612, 620 (1967) (emphasis added), 44 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 54 of 117 and to “prohibit only pressure brought to bear on a third person who is wholly unconcerned in the disagreement [between the union and the primary employer],” Chipman Freight Services Inc. v. NLRB, 843 F.2d 1224, 1227 (9th Cir. 1988) (quotation marks and citation omitted; emphasis added). Sections 8(e) and 8(b)(4) do not proscribe activities that merely affect an employer’s dealings with third parties but have “the object of pressuring the employer for agreements regulating relations between him and his own employees.” Nat’l Woodwork Mfrs., 386 U.S. at 620. This is precisely the type of conduct that any EDR would engage in here. It would be advancing the interests of its members with respect to their own relationships with the driver coordinator, not pressuring the driver coordinator to engage in conduct aimed at advancing the EDR’s interests elsewhere. This Court held in Chipman Freight Services Inc. v. NLRB that the use of coercive tactics (namely, picketing) to advance independent contractors’ interests with respect to the business entity with which they contract does not violate Section 8(b)(4), because the object of such picketing is to effect changes in their contractual relationship with that entity, not to force a neutral business to cease doing business with another. 843 F.2d at 1227. Chipman expressly rejected Plaintiffs’ argument that conduct that would be permissible on behalf of employees violates Section 8(b)(4) if undertaken on behalf of independent contractors. 843 F.2d at 1226-27. Accordingly, an EDR’s conduct in campaigning and negotiating on behalf of a group 45 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 55 of 117 of independent contractor Uber or Lyft drivers to affect the terms and conditions of their work for those companies—which are plainly not “neutral” in their relationship with their drivers but are in fact the targets of the representational activity—is not subject to challenge under Sections 8(b)(4) and 8(e). See Teamsters Local 70, 288 NLRB 1224, 1225 (1988) (“Primary picketing includes all picketing against nonneutral parties, whether by independent contractors or by anyone else.”). In Production Workers Union Local 707 v. NLRB, 793 F.2d 323 (D.C. Cir. 1986), the D.C. Circuit similarly rejected the argument that picketing on behalf of independent contractor taxicab drivers against the companies with which they contracted was secondary activity. The court held that it was “altogether clear” that Congress intended to permit such activity, because it was not directed against “a third person who is wholly unconcerned in the disagreement.” Id. at 328 (quotation marks and citation omitted); id. at 331 (“[T]he caselaw and legislative history … contain extraordinarily ‘strong indication’ that Congress intended ‘primary activity’ to include all picketing against non-neutral parties, whether by independent contractors or by anyone else ….”); id. at 331-32 (rejecting NLRB’s position that strike by independent contractors could not constitute primary activity); see also Prod. Workers Union Local 707, 283 NLRB 340 (1987) (determining, on remand, that picketing was primary activity, even though workers were independent contractors). 46 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 56 of 117 Production Workers specifically distinguished the independent contractor taxicab driver picketing at issue in that case from the cases relied upon by Plaintiffs, which involved “unionized employees of trucking companies attempt[ing] to force independent owner-operators—neutral third parties in the dispute between employees and employers—to join the union.” 793 F.2d at 330; see AOB 18-20. In such cases, the picketing is not “on behalf of independent contractors but against neutral independent contractors.” Id. at 330 (emphasis in original); see, e.g., Constr. Bldg. Material, Teamsters, 222 NLRB 423, 430 (1976) (picketing unlawful where intended “to compel [company using independent contractor drivers] to recognize the [picketing union] as the bargaining representative of persons employed by [company], including owner-operators, and to sign a contract”). Plaintiffs attempt to distinguish Chipman by arguing that the Ordinance “does not authorize a ‘primary strike or primary picketing’ by union drivers” and instead “empowers a union to impose its representation on drivers who are nonunion, which is a secondary organizing objective.” AOB 26 (emphasis in original). But the driver coordinators subject to the Ordinance are no different from the contracting company in Chipman. The union in Chipman represented some of the relevant independent contractors in picketing to persuade the company to reinstate a particular “subhaul agreement” applicable to its independent contractors. 843 F.2d at 1225. Just like Uber and Lyft here, “Chipman [was] clearly not a neutral third party” to that dispute, 47 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 57 of 117 because “the sole object of the” challenged conduct was the “agreement[] it attempted to impose upon [its] independent [contractors].” Id. at 1227; see also Production Workers, 793 F.2d at 328 (taxi companies picketed by independent contractors were “directly and intimately involved in the underlying dispute”). While such conduct may affect the terms and conditions of independent contractors who choose not to support such picketing or to be represented by a Director-certified EDR, that fact, standing alone, does not transform collective advocacy with respect to the agreements that govern such independent contractors’ working relationships into secondary activity targeting non-members. Indeed, Chipman expressly recognized that the “NLRA [does not] require that the support a union obtains from those it represents be unanimous.” 843 F.3d at 1227.18 Finally, and as an entirely separate matter, Plaintiffs’ argument disregards the fact that whether conduct directed toward an allegedly neutral party is secondary or primary for the purposes of Sections 8(b)(4) and 8(e) depends on the intent of the labor organization. See Int’l Bhd. of Teamsters, Local 251, 691 F.3d at 56 (“[I]t is the intended purpose of an agreement, not its effect, that determines whether the agreement has a permissible primary object.”). Plaintiffs speculate that the alleged 18 Plaintiffs cite Chipman’s admonition that a union “‘may not picket against the other subhaulers’ who are nonunion,” AOB 26 (quoting 843 F.2d at 1227), but Plaintiffs make no allegation that any QDR or EDR is picketing any nonunion drivers, and nothing in the Ordinance requires or condones such activity. 48 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 58 of 117 purpose of an EDR negotiating and entering into an agreement with a driver coordinator might be to unionize nonmember drivers, as opposed to improving the working conditions of the drivers it represents. But this Court need not credit such groundless speculation about the purported motives of entities that might apply to serve as QDRs or EDRs when reviewing the grant of a motion to dismiss. See Twombly, 550 U.S. at 555 (“Factual allegations must be enough to raise a right to relief above the speculative level ….”). In any event, and most importantly, such speculation says nothing about the Ordinance, which does not purport to further such a purpose. To the contrary, its purpose is to improve the safety and reliability of for-hire transportation by providing drivers with the ability to collectively negotiate the terms of their contracts with Uber and Lyft. That an EDR may have some speculative ulterior motive does not mean that the Ordinance being challenged here cannot be lawfully applied in any circumstance. For all of the foregoing reasons, the Ordinance is not preempted by the NLRA under Garmon. D. Machinists preemption does not apply Plaintiffs’ alternative argument—that if the Ordinance is not Garmon preempted it is nevertheless preempted under Machinists v. Wisconsin Employment Relations Commission, 427 U.S. 132 (1976)—is also meritless. 49 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 59 of 117 Machinists preemption is based on the principle that, while protecting and prohibiting certain conduct by NLRA-covered employers, employees, and labor organizations, Congress intentionally left some such conduct “unregulated” to be instead “‘controlled by the free play of economic forces.’” Id. at 140 (quoting NLRB v. Nash-Finch Co., 404 U.S. 138, 144 (1971)); see also id. at 140 n.4 (Machinists preemption prevents state and local governments from upsetting the NLRA’s “balance of protection, prohibition, and laissez-faire in respect to union organization, collective bargaining, and labor disputes”) (emphasis added). Because Machinists preemption is designed to protect this balance of protections, prohibitions, and non-regulation, the labor activities relevant to Machinists doctrine are solely those that involve employees, employers, and labor organizations covered by the NLRA. Where Congress excludes particular working relationships from NLRA coverage without prohibiting state or local regulation of those relationships, as it did here with respect to independent contractors, “the states remain free to legislate as they see fit, and may apply their own views of proper public policy to the collective bargaining process insofar as it is subject to their jurisdiction.” United Farm Workers, 669 F.2d at 1257; see Greene v. Dayton, 806 F.3d 1146, 1149 (8th Cir.), cert. denied, 136 S.Ct. 2014 (2016) (Machinists preemption inapplicable to workers excluded from NLRA); Willmar Poultry Co. v. 50 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 60 of 117 Jones, 430 F.Supp. 593, 576-78 (D. Minn. 1977) (same). Plaintiffs’ Machinists argument entirely ignores this critical distinction, which dooms their claim. II. The District Court’s dismissal of Plaintiffs’ First Amendment claim should be affirmed A. Plaintiffs’ First Amendment claim is not ripe As with their NLRA claims, Plaintiffs’ First Amendment claim is not ripe. Plaintiffs’ claim is predicated on their contention that being represented by an EDR in negotiations impinges on their speech and associational rights because “certification of an [EDR]” will allegedly deprive them of their “right to speak and contract with driver coordinators.” AOB 41. Even if that legal claim were sound (it is not), no QDR has collected the requisite showing of support or been certified as an EDR for Uber or Lyft drivers. It is far from certain that any QDR will ever succeed in procuring the necessary support—the absolute bare minimum required for Plaintiffs to assert such a claim at this point. Bierman v. Dayton, No. 14–3021 (MJD/LIB), 2014 WL 4145410 (D. Minn. Aug. 20, 2014) (First Amendment challenge to exclusive representation not ripe when election to certify representative had not yet taken place). On that basis alone, the dismissal of Plaintiffs’ First Amendment claim should be affirmed. B. Plaintiffs’ First Amendment claim fails on the merits. In any event, Plaintiffs’ claim that a certified EDR’s ability to negotiate terms and conditions that apply to all drivers for a particular company somehow infringes 51 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 61 of 117 on their First Amendment associational rights was rejected by the Supreme Court over 30 years ago in Minnesota State Board for Community Colleges v. Knight, 465 U.S. 271 (1984). And in the last two years alone, this legal theory has also been rejected by the First, Second, and Seventh Circuits, and at least two federal district courts. See D’Agostino v. Baker, 812 F.3d 240 (1st Cir.), cert. denied, 136 S.Ct. 2473 (2016) (Souter, J., sitting by designation); Jarvis v. Cuomo, 660 Fed.Appx. 72 (2d Cir. 2016), cert. denied, 137 S.Ct. 1204 (2017); Hill v. Serv. Employees Int’l Union, Healthcare Ill., 850 F.3d 861 (7th Cir.), cert. denied, __ S.Ct. __, 2017 WL 2559023 (Nov. 13, 2017); Mentele v. Inslee, No. C15-5134, 2016 WL 3017713 (W.D. Wash. May 26, 2016); Bierman v. Dayton, 227 F.Supp.3d 1022 (D. Minn. 2017). The same outcome is required here. The First Amendment protects the right to associate “for the purpose of engaging in those activities protected by the First Amendment.” City of Dallas v. Stanglin, 490 U.S. 19, 23-24 (1989) (quoting Roberts v. United States Jaycees, 468 U.S. 609, 617-18 (1984)). The right not to associate derives from that affirmative right of association, see Roberts, 468 U.S. at 623, and thus applies only where the association at issue involves speech or expression. Plaintiffs’ First Amendment theory is that the Ordinance somehow compels them to “associate” with the expressive activities of the EDR selected by a majority of their driver coordinator’s qualifying drivers. See ER 117, 122 (¶¶54(d), 55(d), 52 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 62 of 117 75). But Plaintiffs effectively ignore the critical distinction between the freedom of expressive association, which the First Amendment protects, and “association” in an economic or colloquial sense, which is all that is at issue here.19 The Supreme Court squarely rejected Plaintiffs’ theory in Knight, which held that systems of exclusive representation do not infringe upon the constitutional rights of individuals within the bargaining unit who do not wish to be represented by the union, even where the negotiations at issue arguably involve not only economic conduct but also expressive activities such as petitioning the government. 465 U.S. at 273, 278-79, 288; Knight v. Minnesota Cmty. Coll. Faculty Ass’n, 460 U.S. 1048 (1983).20 Knight reasoned that the union’s exclusive representation of college 19 In Rumsfeld v. Forum for Academic and Institutional Rights, 547 U.S. 47 (2016), for example, law schools were required to “‘associate’ with military recruiters in the sense that they interact[ed] with them,” but there was no compelled expressive association that triggered heightened First Amendment scrutiny because the law schools were not required to endorse the recruitment efforts and the presence of military recruiters on campus would not lead reasonable people to believe the “law schools agree[d] with any speech by recruiters.” Id. at 65, 69. 20 The full opinion in Knight considered Minnesota’s “meet and confer” process, in which the elected union representative had the exclusive right to meet and discuss certain employment-related policy matters outside the scope of bargaining with campus administrators. 465 U.S. at 274-75. However, the Knight plaintiffs had also challenged the representative’s exclusive right to negotiate represented faculty members’ terms of employment—which is indistinguishable from the authority given to an EDR under the Ordinance. Id. The lower court rejected the challenge to that process, and the Supreme Court summarily affirmed that decision. See Knight v. Minnesota Cmty. Coll. Faculty Ass’n, 460 U.S. 1048 (1983). Plaintiffs fail to cite, much less discuss, that summary affirmance, notwithstanding the fact that it remains binding precedent. Hicks v. Miranda, 422 U.S. 332, 344-45 (1975). 53 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 63 of 117 instructors “in no way restrained [instructors’] freedom to speak on any educationrelated issue or their freedom to associate or not to associate with whom they please, including the exclusive representative.” 465 U.S. at 288. While the “unique status” of exclusive representative may “amplif[y] its voice,” and non-members may “feel some pressure to join the exclusive representative,” this “is no different from the pressure to join a majority party that persons in the minority always feel” and “does not create an unconstitutional inhibition on associational freedom.” Id. at 288-90. The same is true here, where Plaintiffs remain free to speak and associate as they choose, and the Ordinance merely requires Uber and Lyft to apply the uniform terms set forth in any agreement approved by the Director to all drivers with whom it contracts. Plaintiffs seek to distinguish Knight on the ground that it allegedly considered only whether “excluding” certain employees from negotiations violated their First Amendment right “to participate in those sessions.” AOB 45 (emphasis in original). But in Knight, as here, the issue was whether employees had a First Amendment right not to be represented by an exclusive representative in negotiations with their employer. See 465 U.S. at 278 (plaintiffs were “challenging the constitutionality of … exclusive representation of community college faculty in both the ‘meet and negotiate’ and ‘meet and confer’ processes”). 54 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 64 of 117 Plaintiffs further seek to distinguish Knight on the ground that it involved the process through which public employees designate an exclusive representative for negotiations with the state itself, whereas here the Ordinance (much like the NLRA, in the context of NLRA-covered employees, and numerous state laws governing agricultural employees) sets the ground rules for selecting an exclusive representative for negotiations between private-party drivers and driver coordinators. But that distinction makes Plaintiffs’ First Amendment claim weaker, not stronger. The public employee unionization at issue in Knight arguably implicated the right to associate for the First Amendment-protected purpose of petitioning the government, whereas negotiations between an exclusive representative and a private, non-governmental entity (whether under the Ordinance or under the NLRA or the Railway Labor Act) involve no such petitioning activity, and instead involve solely non-expressive commercial conduct. See, e.g., Virgin Atl. Airways, Ltd. v. NMB, 956 F.2d 1245, 1251-52 (2d Cir. 1992) (rejecting comparable First Amendment challenge arising in context of private sector exclusive representation because “the First Amendment [does not] protect individuals from being represented by a group that they do not wish to have represent them”); Air Transp. Ass’n of Am., Inc. v. NMB, 663 F.3d 476, 488 (D.C. Cir. 2011). Contrary to Plaintiffs’ contentions, Mullhall v. UNITE HERE Local 355, 618 F.3d 1279 (11th Cir. 2010), does not support their position, or enable them to evade 55 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 65 of 117 Knight’s clear holding.21 Mullhall addressed only whether the plaintiff had standing to pursue a claim that his employer had violated a provision (not relevant here) of federal labor law, and specifically explained that there is a difference between an “interest” that supports standing and an infringement of First Amendment rights. See id. at 1286, 1287-88; see also D’Agostino, 812 F.3d at 245 (distinguishing Mulhall as “a case on standing that recognized only a First Amendment associational interest, which it distinguished from a right”).22 Because exclusive representation standing alone does not violate the First Amendment associational rights of dissenters, see D’Agostino, 812 F.3d at 244, there is no need to balance any such intrusion against the underlying governmental interest. See Bierman, 227 F.Supp.3d at 1031 (“Because the First Amendment is not violated, the State need not demonstrate any special justification for its law.”) (quotation omitted). 21 Plaintiffs also cite 14 Penn Plaza LLC v. Pyett, 556 U.S. 247 (2009), but that case did not consider the impact of exclusive representation on First Amendment rights. 22 It is not unusual for a plaintiff to have a First Amendment “interest” that is sufficient to support standing even though on the merits there is no First Amendment infringement. See, e.g., Univ. of Pa. v. E.E.O.C., 493 U.S. 182, 201 (1990) (plaintiff had standing to challenge compelled disclosure of peer review reports, but disclosure did not infringe First Amendment rights). Moreover, Mulhall’s holding with respect to standing was seriously questioned when the Supreme Court, having granted certiorari, dismissed the writ as improvidently granted. See Unite Here Local 355 v. Mulhall, 134 S.Ct. 594, 595 (2013) (Breyer, J., dissenting). 56 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 66 of 117 To the extent Plaintiffs rely on case law involving mandatory union membership or fees in support of their First Amendment claim, see ER 122 (¶77), their claim rests on speculation, because whether any driver coordinator and EDR will reach an agreement that requires membership or other financial contributions is entirely uncertain. The Ordinance does not require (or allow the City to require) such an agreement, and even if the execution of such an agreement might support a First Amendment challenge, it would not establish that the Ordinance is unconstitutional in all applications. See ER 13 (“To the extent plaintiffs’ First Amendment claim is based on a fear that they will be forced to pay fees to the union and/or fund speech or political activities with which they disagree, their claim is not ripe for adjudication.”). For that reason, Plaintiffs’ reliance on Harris v. Quinn, 134 S.Ct. 2618 (2014), see AOB 44-45, is misplaced. Harris held that the First Amendment prevented Illinois from requiring state-compensated home care providers to pay service fees to a union representative that they “do not want to join or support.” 134 S.Ct. at 2644. But as the Court made clear, the Harris plaintiffs did not “challenge the authority of [the Union] to serve as the exclusive representative of all the personal assistants in bargaining with the State.” Id. at 2640; see D’Agostino, 812 F.3d at 244 (“Harris did not speak to … the premise assumed and extended in Knight: that exclusive bargaining representation by a democratically selected union does not, without more, 57 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 67 of 117 violate the right of free association on the part of dissenting non-union members of the bargaining unit.”).23 Accordingly, under longstanding Supreme Court precedent, Plaintiffs’ First Amendment challenge to the Ordinance fails. CONCLUSION For these reasons, the District Court’s dismissal of Plaintiffs’ complaint should be affirmed. Respectfully submitted, Dated: December 1, 2017 /s/ Michael K. Ryan Michael K. Ryan Gregory Colin Narver Sara Kate O’Connor-Kriss Josh Johnson SEATTLE CITY ATTORNEY’S OFFICE Stephen P. Berzon Stacey M. Leyton Peder J. Thoreen P. Casey Pitts ALTSHULER BERZON LLP Attorneys for Defendants-Appellees City of Seattle, Seattle Department of Finance and Administrative Services, and Fred Podesta 23 Indeed, after Harris, the Seventh Circuit rejected a challenge to the very same union’s authority to act as the exclusive representative for home care providers. Hill, 850 F.3d 861, cert. denied, __ S.Ct. __, 2017 WL 2559023. 58 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 68 of 117 STATEMENT OF RELATED CASES (Circuit Rule 28-2.6) The Chamber of Commerce of the United States and Rasier, LLC have also challenged the Seattle Ordinance in a separate suit. The District Court dismissed their claims, and an appeal is currently pending in this Court. Chamber of Commerce v. City of Seattle, No. 17-35640. 59 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 69 of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s/Michael K. Ryan ? L OD N OD P D L QD C 8 HQHF @ L Q 12/1/2017 #!P (! N JR P QV N D C L @ K D HP @ B B D N Q@ A JD EM O D JD B QOM L HB @ JJV &EHJD C C M B R K D L QP $ !(- 7 #%&$%$%'" 60 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 70 of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s/Stacey M. Leyton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ase: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 71 of 117 ADDENDUM OF STATUTES, RULES, AND REGULATIONS Table of Contents U.S. Const. art. VI, cl.2 ................................................................................... A-1 29 U.S.C. §158 ............................................................................................... A-1 Seattle, Wash. Municipal Code §6.310.110..................................................... A-8 Seattle, Wash. Municipal Code §6.310.735..................................................... A-9 Seattle, Wash. Ordinance No. 124968 ............................................................A-19 Director’s Rule FHDR-1 ................................................................................A-36 Director’s Rule FHDR-2 ................................................................................A-39 Director’s Rule FHDR-4 ................................................................................A-44 A-i Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 72 of 117 United States Constitution, Article VI, Clause 2. Supreme Law of Land This Constitution, and the Laws of the United States which shall be made in Pursuance thereof; and all Treaties made, or which shall be made, under the Authority of the United States, shall be the supreme Law of the Land; and the Judges in every State shall be bound thereby, any Thing in the Constitution or Laws of any State to the Contrary notwithstanding. 29 U.S.C. §158. Unfair labor practices (a) Unfair labor practices by employer It shall be an unfair labor practice for an employer— (1) to interfere with, restrain, or coerce employees in the exercise of the rights guaranteed in section 157 of this title; (2) to dominate or interfere with the formation or administration of any labor organization or contribute financial or other support to it: Provided, That subject to rules and regulations made and published by the Board pursuant to section 156 of this title, an employer shall not be prohibited from permitting employees to confer with him during working hours without loss of time or pay; (3) by discrimination in regard to hire or tenure of employment or any term or condition of employment to encourage or discourage membership in any labor organization: Provided, That nothing in this subchapter, or in any other statute of the United States, shall preclude an employer from making an agreement with a labor organization (not established, maintained, or assisted by any action defined in this subsection as an unfair labor practice) to require as a condition of employment membership therein on or after the thirtieth day following the beginning of such employment or the effective date of such agreement, whichever is the later, (i) if such labor organization is the representative of the employees as provided in section 159(a) of this title, in the appropriate collective-bargaining unit covered by such agreement when made, and (ii) unless following an election held as provided in section 159(e) of this title within one year preceding the effective date of such agreement, the Board shall have certified that at least a majority of the employees eligible to vote in such election have voted to rescind the authority of such labor organization to make such an agreement: Provided further, That no employer shall justify any discrimination against an employee for nonmembership in a labor organization (A) if he has reasonable grounds for believing that such membership was not available to the employee on the same terms and conditions generally A-1 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 73 of 117 applicable to other members, or (B) if he has reasonable grounds for believing that membership was denied or terminated for reasons other than the failure of the employee to tender the periodic dues and the initiation fees uniformly required as a condition of acquiring or retaining membership; (4) to discharge or otherwise discriminate against an employee because he has filed charges or given testimony under this subchapter; (5) to refuse to bargain collectively with the representatives of his employees, subject to the provisions of section 159(a) of this title. (b) Unfair labor practices by labor organization It shall be an unfair labor practice for a labor organization or its agents-(1) to restrain or coerce (A) employees in the exercise of the rights guaranteed in section 157 of this title: Provided, That this paragraph shall not impair the right of a labor organization to prescribe its own rules with respect to the acquisition or retention of membership therein; or (B) an employer in the selection of his representatives for the purposes of collective bargaining or the adjustment of grievances; (2) to cause or attempt to cause an employer to discriminate against an employee in violation of subsection (a)(3) or to discriminate against an employee with respect to whom membership in such organization has been denied or terminated on some ground other than his failure to tender the periodic dues and the initiation fees uniformly required as a condition of acquiring or retaining membership; (3) to refuse to bargain collectively with an employer, provided it is the representative of his employees subject to the provisions of section 159(a) of this title; (4) (i) to engage in, or to induce or encourage any individual employed by any person engaged in commerce or in an industry affecting commerce to engage in, a strike or a refusal in the course of his employment to use, manufacture, process, transport, or otherwise handle or work on any goods, articles, materials, or commodities or to perform any services; or (ii) to threaten, coerce, or restrain any person engaged in commerce or in an industry affecting commerce, where in either case an object thereof is-- A-2 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 74 of 117 (A) forcing or requiring any employer or self-employed person to join any labor or employer organization or to enter into any agreement which is prohibited by subsection (e); (B) forcing or requiring any person to cease using, selling, handling, transporting, or otherwise dealing in the products of any other producer, processor, or manufacturer, or to cease doing business with any other person, or forcing or requiring any other employer to recognize or bargain with a labor organization as the representative of his employees unless such labor organization has been certified as the representative of such employees under the provisions of section 159 of this title: Provided, That nothing contained in this clause (B) shall be construed to make unlawful, where not otherwise unlawful, any primary strike or primary picketing; (C) forcing or requiring any employer to recognize or bargain with a particular labor organization as the representative of his employees if another labor organization has been certified as the representative of such employees under the provisions of section 159 of this title; (D) forcing or requiring any employer to assign particular work to employees in a particular labor organization or in a particular trade, craft, or class rather than to employees in another labor organization or in another trade, craft, or class, unless such employer is failing to conform to an order or certification of the Board determining the bargaining representative for employees performing such work: Provided, That nothing contained in this subsection shall be construed to make unlawful a refusal by any person to enter upon the premises of any employer (other than his own employer), if the employees of such employer are engaged in a strike ratified or approved by a representative of such employees whom such employer is required to recognize under this subchapter: Provided further, That for the purposes of this paragraph (4) only, nothing contained in such paragraph shall be construed to prohibit publicity, other than picketing, for the purpose of truthfully advising the public, including consumers and members of a labor organization, that a product or products are produced by an employer with whom the labor organization has a primary dispute and are distributed by another employer, as long as such publicity does not have an effect of inducing any individual employed by any person other than the primary employer in the course of his employment to refuse to pick up, deliver, or transport any goods, or not to perform any services, at the establishment of the employer engaged in such distribution; A-3 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 75 of 117 (5) to require of employees covered by an agreement authorized under subsection (a)(3) the payment, as a condition precedent to becoming a member of such organization, of a fee in an amount which the Board finds excessive or discriminatory under all the circumstances. In making such a finding, the Board shall consider, among other relevant factors, the practices and customs of labor organizations in the particular industry, and the wages currently paid to the employees affected; (6) to cause or attempt to cause an employer to pay or deliver or agree to pay or deliver any money or other thing of value, in the nature of an exaction, for services which are not performed or not to be performed; and (7) to picket or cause to be picketed, or threaten to picket or cause to be picketed, any employer where an object thereof is forcing or requiring an employer to recognize or bargain with a labor organization as the representative of his employees, or forcing or requiring the employees of an employer to accept or select such labor organization as their collective bargaining representative, unless such labor organization is currently certified as the representative of such employees: (A) where the employer has lawfully recognized in accordance with this subchapter any other labor organization and a question concerning representation may not appropriately be raised under section 159(c) of this title, (B) where within the preceding twelve months a valid election under section 159(c) of this title has been conducted, or (C) where such picketing has been conducted without a petition under section 159(c) of this title being filed within a reasonable period of time not to exceed thirty days from the commencement of such picketing: Provided, That when such a petition has been filed the Board shall forthwith, without regard to the provisions of section 159(c)(1) of this title or the absence of a showing of a substantial interest on the part of the labor organization, direct an election in such unit as the Board finds to be appropriate and shall certify the results thereof: Provided further, That nothing in this subparagraph (C) shall be construed to prohibit any picketing or other publicity for the purpose of truthfully advising the public (including consumers) that an employer does not employ members of, or have a contract with, a labor organization, unless an effect of such picketing is to induce any individual employed by A-4 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 76 of 117 any other person in the course of his employment, not to pick up, deliver or transport any goods or not to perform any services. Nothing in this paragraph (7) shall be construed to permit any act which would otherwise be an unfair labor practice under this subsection. (c) Expression of views without threat of reprisal or force or promise of benefit The expressing of any views, argument, or opinion, or the dissemination thereof, whether in written, printed, graphic, or visual form, shall not constitute or be evidence of an unfair labor practice under any of the provisions of this subchapter, if such expression contains no threat of reprisal or force or promise of benefit. (d) Obligation to bargain collectively For the purposes of this section, to bargain collectively is the performance of the mutual obligation of the employer and the representative of the employees to meet at reasonable times and confer in good faith with respect to wages, hours, and other terms and conditions of employment, or the negotiation of an agreement, or any question arising thereunder, and the execution of a written contract incorporating any agreement reached if requested by either party, but such obligation does not compel either party to agree to a proposal or require the making of a concession: Provided, That where there is in effect a collectivebargaining contract covering employees in an industry affecting commerce, the duty to bargain collectively shall also mean that no party to such contract shall terminate or modify such contract, unless the party desiring such termination or modification-(1) serves a written notice upon the other party to the contract of the proposed termination or modification sixty days prior to the expiration date thereof, or in the event such contract contains no expiration date, sixty days prior to the time it is proposed to make such termination or modification; (2) offers to meet and confer with the other party for the purpose of negotiating a new contract or a contract containing the proposed modifications; (3) notifies the Federal Mediation and Conciliation Service within thirty days after such notice of the existence of a dispute, and simultaneously therewith notifies any State or Territorial agency established to mediate and conciliate A-5 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 77 of 117 disputes within the State or Territory where the dispute occurred, provided no agreement has been reached by that time; and (4) continues in full force and effect, without resorting to strike or lock-out, all the terms and conditions of the existing contract for a period of sixty days after such notice is given or until the expiration date of such contract, whichever occurs later: The duties imposed upon employers, employees, and labor organizations by paragraphs (2) to (4) of this subsection shall become inapplicable upon an intervening certification of the Board, under which the labor organization or individual, which is a party to the contract, has been superseded as or ceased to be the representative of the employees subject to the provisions of section 159(a) of this title, and the duties so imposed shall not be construed as requiring either party to discuss or agree to any modification of the terms and conditions contained in a contract for a fixed period, if such modification is to become effective before such terms and conditions can be reopened under the provisions of the contract. Any employee who engages in a strike within any notice period specified in this subsection, or who engages in any strike within the appropriate period specified in subsection (g) of this section, shall lose his status as an employee of the employer engaged in the particular labor dispute, for the purposes of sections 158, 159, and 160 of this title, but such loss of status for such employee shall terminate if and when he is reemployed by such employer. Whenever the collective bargaining involves employees of a health care institution, the provisions of this subsection shall be modified as follows: (A) The notice of paragraph (1) of this subsection shall be ninety days; the notice of paragraph (3) of this subsection shall be sixty days; and the contract period of paragraph (4) of this subsection shall be ninety days. (B) Where the bargaining is for an initial agreement following certification or recognition, at least thirty days' notice of the existence of a dispute shall be given by the labor organization to the agencies set forth in paragraph (3) of this subsection. (C) After notice is given to the Federal Mediation and Conciliation Service under either clause (A) or (B) of this sentence, the Service shall promptly communicate with the parties and use its best efforts, by mediation and conciliation, to bring them to agreement. The parties shall participate fully and promptly in such meetings as may be undertaken by the Service for the purpose of aiding in a settlement of the dispute. A-6 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 78 of 117 (e) Enforceability of contract or agreement to boycott any other employer; exception It shall be an unfair labor practice for any labor organization and any employer to enter into any contract or agreement, express or implied, whereby such employer ceases or refrains or agrees to cease or refrain from handling, using, selling, transporting or otherwise dealing in any of the products of any other employer, or to cease doing business with any other person, and any contract or agreement entered into heretofore or hereafter containing such an agreement shall be to such extent unenforcible1 and void: Provided, That nothing in this subsection shall apply to an agreement between a labor organization and an employer in the construction industry relating to the contracting or subcontracting of work to be done at the site of the construction, alteration, painting, or repair of a building, structure, or other work: Provided further, That for the purposes of this subsection and subsection (b)(4)(B) the terms “any employer”, “any person engaged in commerce or an industry affecting commerce”, and “any person” when used in relation to the terms “any other producer, processor, or manufacturer”, “any other employer”, or “any other person” shall not include persons in the relation of a jobber, manufacturer, contractor, or subcontractor working on the goods or premises of the jobber or manufacturer or performing parts of an integrated process of production in the apparel and clothing industry: Provided further, That nothing in this subchapter shall prohibit the enforcement of any agreement which is within the foregoing exception. (f) Agreement covering employees in the building and construction industry It shall not be an unfair labor practice under subsections (a) and (b) of this section for an employer engaged primarily in the building and construction industry to make an agreement covering employees engaged (or who, upon their employment, will be engaged) in the building and construction industry with a labor organization of which building and construction employees are members (not established, maintained, or assisted by any action defined in subsection (a) as an unfair labor practice) because (1) the majority status of such labor organization has not been established under the provisions of section 159 of this title prior to the making of such agreement, or (2) such agreement requires as a condition of employment, membership in such labor organization after the seventh day following the beginning of such employment or the effective date of the agreement, whichever is later, or (3) such agreement requires the employer to notify such labor organization of opportunities for employment with such employer, or gives such labor organization an opportunity to refer qualified applicants for such employment, or (4) such agreement specifies minimum training A-7 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 79 of 117 or experience qualifications for employment or provides for priority in opportunities for employment based upon length of service with such employer, in the industry or in the particular geographical area: Provided, That nothing in this subsection shall set aside the final proviso to subsection (a)(3): Provided further, That any agreement which would be invalid, but for clause (1) of this subsection, shall not be a bar to a petition filed pursuant to section 159(c) or 159(e) of this title. (g) Notification of intention to strike or picket at any health care institution A labor organization before engaging in any strike, picketing, or other concerted refusal to work at any health care institution shall, not less than ten days prior to such action, notify the institution in writing and the Federal Mediation and Conciliation Service of that intention, except that in the case of bargaining for an initial agreement following certification or recognition the notice required by this subsection shall not be given until the expiration of the period specified in clause (B) of the last sentence of subsection (d). The notice shall state the date and time that such action will commence. The notice, once given, may be extended by the written agreement of both parties. Seattle, Wash. Municipal Code §6.310.110 - Definitions For the purposes of this chapter and unless the context plainly requires otherwise, the following definitions apply: … “Driver coordinator” means an entity that hires, contracts with, or partners with for-hire drivers for the purpose of assisting them with, or facilitating them in, providing for-hire services to the public. For the purposes of this definition, “driver coordinator” includes but is not limited to taxicab associations, for-hire vehicle companies, and transportation network companies. … “Exclusive driver representative” (EDR) means a qualified driver representative, certified by the Director to be the sole and exclusive representative of all for-hire drivers operating within the City for a particular driver coordinator, and authorized to negotiate, obtain and enter into a contract that sets forth terms and conditions of work applicable to all of the for-hire drivers employed by that driver coordinator. … A-8 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 80 of 117 “For-hire driver" means any person in physical control of a taxicab, for-hire vehicle, or transportation network company endorsed vehicle who is required to be licensed under this chapter. The term includes a lease driver, owner/operator, or employee, who drives taxicabs, for-hire vehicles, or transportation network company endorsed vehicles. … “Qualifying driver” means a for-hire driver, who drives for a driver coordinator and who satisfies the conditions established by the Director pursuant to Section 6.310.735. In establishing such conditions, the Director shall consider factors such as the length, frequency, total number of trips, and average number of trips per driver completed by all of the drivers who have performed trips in each of the four calendar months immediately preceding the commencement date, for a particular driver coordinator, any other factors that indicate that a driver's work for a driver coordinator is significant enough to affect the safety and reliability of for-hire transportation, and standards established by other jurisdictions for granting persons the right to vote to be represented in negotiations pertaining to the terms and conditions of employment. A for-hire driver may be a qualifying driver for more than one driver coordinator. … “Qualified driver representative” (QDR) means an entity that assists for-hire drivers operating within the City for a particular driver coordinator in reaching consensus on desired terms of work and negotiates those terms on their behalf with driver coordinators. … “Transportation network company” (TNC) means an organization whether a corporation, partnership, sole proprietor, or other form, licensed under this chapter and operating in the City of Seattle that offers prearranged transportation services for compensation using an online-enabled TNC application or platform to connect passengers with drivers using their personal vehicles and that meets the licensing requirements of Section 6.310.130 and any other requirements under this chapter. Seattle, Wash. Municipal Code §6.310.735 - Exclusive driver representatives A. The Director shall promulgate a commencement date no later than January 17, 2017. A-9 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 81 of 117 B. The process of designating a QDR shall be prescribed by Director’s rule. The designation of a QDR shall be based on, but not limited to, consideration of the following factors: 1. Registration with the Washington Secretary of State as a not-for-profit entity; 2. Organizational bylaws that give drivers the right to be members of the organization and participate in the democratic control of the organization; and 3. Experience in and/or a demonstrated commitment to assisting stakeholders in reaching consensus agreements with, or related to, employers and contractors. C. An entity wishing to be considered as a QDR for for-hire drivers operating within the City must submit a request to the Director within 30 days of the commencement date or at a later date as provided in subsection G of this section. Within 14 days of the receipt of such a request, the Director will notify the applicant in writing of the determination. Applicants who dispute the Director’s determination may appeal to the Hearing Examiner within 10 days of receiving the determination. The Director shall provide a list of all QDRs to all driver coordinators. 1. An entity that has been designated as a QDR shall be required to establish annually that it continues to satisfy the requirements for designation as a QDR. 2. An entity that has been designated as a QDR and that seeks to represent the drivers of a driver coordinator shall notify the driver coordinator of its intent to represent those drivers within 14 days of its designation as a QDR. That notice may be provided by any means reasonably calculated to reach the driver coordinator, including by written notice mailed or delivered to a transportation network company or taxicab association representative at the mailing address listed with the City. D. Driver coordinators who have hired, contracted with, partnered with, or maintained a contractual relationship or partnership with, 50 or more for-hire drivers in the 30 days prior to the commencement date, other than in the context of an employer-employee relationship, must, within 75 days of the commencement date, provide all QDRs that have given the notice specified in subsection 6.310.735.C.2 the names, addresses, email addresses (if available), A-10 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 82 of 117 and phone number (if available) of all qualifying drivers they hire, contract with, or partner with. E. QDRs shall use driver contact information for the sole purpose of contacting drivers to solicit their interest in being represented by the QDR. The QDR may not sell, publish, or otherwise disseminate the driver contact information outside the entity/organization. F. The Director shall certify a QDR as the EDR for all drivers contracted with a particular driver coordinator, according to the following: 1. Within 120 days of receiving the driver contact information, a QDR will submit statements of interest to the Director from a majority of qualifying drivers from the list described in subsection 6.310.735.D. Each statement of interest shall be signed, dated, and clearly state that the driver wants to be represented by the QDR for the purpose of negotiations with the driver coordinator. A qualifying driver’s signature may be provided by electronic signature or other electronic means. The Director shall determine by rule the standards and procedures for submitting and verifying statements of interest by qualifying drivers choosing an EDR. a. The methods for submitting and verifying statements of interest by qualifying drivers choosing an EDR may include, but not be limited to: signature verification, unique personal identification number verification, statistical methods, or third party verification. 2. Within 30 days of receiving such statements of interest, the Director shall determine if they are sufficient to designate the QDR as the EDR for all drivers for that particular driver coordinator, and if so, shall so designate the QDR to be the EDR, except that, if more than one QDR establishes that a majority of qualifying drivers have expressed interest in being represented by that QDR, the Director shall designate the QDR that received the largest number of verified affirmative statements of interest to be the EDR. 3. Within 30 days of receiving submissions from all QDRs for a particular driver coordinator, the Director shall either certify one to be the EDR or announce that no QDR met the majority threshold for certification. G. If no EDR is certified for a driver coordinator, the Director shall, upon the written request from a designated QDR or from an entity that seeks to be designated as a QDR, promulgate a new commencement date applicable to that driver coordinator that is no later than 90 days after the request, provided that no A-11 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 83 of 117 driver coordinator shall be subject to the requirements of Section 6.310.735 more than once in any 12-month period. The QDR, any other entity that seeks to be designated as a QDR, and the driver coordinator shall then repeat the processes in subsections 6.310.735.C, 6.310.735.D, and 6.310.735.F. H. 1. Upon certification of the EDR by the Director, the driver coordinator and the EDR shall meet and negotiate in good faith certain subjects to be specified in rules or regulations promulgated by the Director, including, but not limited to, best practices regarding vehicle equipment standards; safe driving practices; the manner in which the driver coordinator will conduct criminal background checks of all prospective drivers; the nature and amount of payments to be made by, or withheld from, the driver coordinator to or by the drivers; minimum hours of work, conditions of work, and applicable rules. If the driver coordinator and the EDR reach agreement on terms, their agreement shall be reduced to a written agreement. The term of such an agreement shall be agreed upon by the EDR and the driver coordinator, but in no case shall the term of such an agreement exceed four years. 2. After reaching agreement, the parties shall transmit the written agreement to the Director. The Director shall review the agreement for compliance with the provisions of this Chapter 6.310, and to ensure that the substance of the agreement promotes the provision of safe, reliable, and economical for-hire transportation services and otherwise advance the public policy goals set forth in Chapter 6.310 and in the Preamble to and Section 1 of the ordinance introduced as C.B. 118499. In conducting that review, the record shall not be limited to the submissions of the EDR and driver coordinator nor to the terms of the proposed agreement. The Director shall have the right to gather and consider any necessary additional evidence, including by conducting public hearings and requesting additional information from the EDR and driver coordinator. Following this review, the Director shall notify the parties of the determination in writing, and shall include in the notification a written explanation of all conclusions. Absent good cause, the Director shall issue the determination of compliance within 60 days of the receipt of an agreement. a. If the Director finds the agreement compliant, the agreement is final and binding on all parties. b. If the Director finds it fails to comply, the Director shall remand it to the parties with a written explanation of the failure(s) and, at the Director’s discretion, recommendations to remedy the failure(s). A-12 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 84 of 117 c. The agreement shall not go into effect until the Director affirmatively determines its adherence to the provisions of this Chapter 6.310 and that the agreement furthers the provision of safe, reliable, and economical for-hire transportation services and the public policy goals set forth in the Preamble to and Section 1 of the ordinance introduced as C.B. 118499. 3. Unless the EDR has been decertified pursuant to subsection 6.310.735.L or has lost its designation as a QDR, the EDR and the driver coordinator shall, at least 90 days before the expiration of an existing agreement approved pursuant to subsections 6.310.735.H.2.c or 6.310.735.I.4.c, meet to negotiate a successor agreement. Any such agreement shall be subject to approval by the Director pursuant to subsection 6.310.735.H.2. If the parties are unable to reach agreement on a successor agreement within 90 days after the expiration of an existing agreement, either party must submit to interest arbitration upon the request of the other pursuant to subsection 6.310.735.I, and the interest arbitrator’s proposed successor agreement shall be subject to review by the Director pursuant to subsections 6.310.735.I.3 and 6.310.735.I.4. 4. Nothing in this section 6.310.735 shall require or preclude a driver coordinator from making an agreement with an EDR to require membership of for-hire drivers in the EDR’s entity/organization within 14 days of being hired, contracted with, or partnered with by the driver coordinator to provide for-hire transportation services to the public. I. If a driver coordinator and the EDR fail to reach an agreement within 90 days of the certification of the EDR by the Director, either party must submit to interest arbitration upon the request of the other. 1. The interest arbitrator may be selected by mutual agreement of the parties. If the parties cannot agree, then the arbitrator shall be determined as follows: from a list of seven arbitrators with experience in labor disputes and/or interest arbitration designated by the American Arbitration Association, the party requesting arbitration shall strike a name. Thereafter the other party shall strike a name. The process will continue until one name remains, who shall be the arbitrator. The cost of the interest arbitration shall be divided equally between the parties. 2. The interest arbitrator shall propose the most fair and reasonable agreement concerning subjects specified in rules or regulations promulgated by the A-13 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 85 of 117 Director as set forth in subsection 6.310.735.H.1 that furthers the provision of safe, reliable, and economical for-hire transportation services and the public policy goals set forth in the Preamble to and Section 1 of the ordinance introduced as C.B. 118499. The term of any agreement proposed by the interest arbitrator shall not exceed two years. In proposing that agreement, the interest arbitrator shall consider the following criteria: a. Any stipulations of the parties; b. The cost of expenses incurred by drivers (e.g., fuel, wear and tear on vehicles, and insurance); c. Comparison of the amount and/or proportion of revenue received from customers by the driver coordinators and the income provided to or retained by the drivers; d. The wages, hours, and conditions of employment of other persons, whether employees or independent contractors, employed as for-hire or taxicab drivers in Seattle and its environs, as well as other comparably sized urban areas; e. If raised by the driver coordinator, the driver coordinator’s financial condition and need to ensure a reasonable return on investment and/or profit; f. Any other factors that are normally or traditionally taken into consideration in the determination of wages, hours, and conditions of employment; and g. The City’s interest in promoting the provision of safe, reliable, and economical for-hire transportation services and otherwise advancing the public policy goals set forth in Chapter 6.310 and in the Preamble to and Section 1 of the ordinance introduced as C.B. 118499. 3. The arbitrator shall transmit the proposed agreement to the Director for review in accordance with the procedures and standards set forth in subsection 6.310.735.H.2. With the proposed agreement, the arbitrator shall transmit a report that sets forth the basis for the arbitrator’s resolution of any disputed issues. The Director shall review the agreement as provided in subsection 6.310.735.H.2. 4. In addition to the review provided for in subsection 6.310.735.I.3, a driver coordinator or EDR may challenge the proposed agreement on the following A-14 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 86 of 117 grounds: that the interest arbitrator was biased, that the interest arbitrator exceeded the authority granted by subsection 6.310.735.H and this subsection 6.310.735.I, and/or that a provision of the proposed agreement is arbitrary and capricious. In the event of such a challenge, the Director will provide notice to the driver coordinator and the EDR, allow the driver coordinator and the EDR the opportunity to be heard, and make a determination as to whether any of the challenges asserted should be sustained. a. If the Director finds the agreement fulfills the requirements of subsection 6.310.735.H.2, and that no challenges raised under this subsection 6.310.735.I.4 should be sustained, the Director will provide written notice of that finding to the parties and the agreement will be deemed final and binding on all parties. b. If the Director finds that the agreement fails to fulfill the requirements of subsection 6.310.735.H.2, or that any challenge asserted under this subsection 6.310.735.I.4 should be sustained, the Director shall remand the agreement to the interest arbitrator with a written explanation of the failure(s) and, at the Director’s discretion, recommendations to remedy the failure(s). c. The agreement shall not go into effect until the Director affirmatively deems the agreement final and binding pursuant to subsections 6.310.735.I.3 and 6.310.735.I.4.a. d. A driver coordinator or EDR may obtain judicial review of the Director’s final determination rendered pursuant to this subsection 6.310.735.I.4 by applying for a Writ of Review in the King County Superior Court within 14 days from the date of the Director’s determination, in accordance with the procedure set forth in Chapter 7.16 RCW, other applicable law, and court rules. The Director’s final determination shall not be stayed pending judicial review unless a stay is ordered by the court. If review is not sought in compliance with this subsection 6.310.735.I.4.d, the determination of the Director shall be final and conclusive. 5. If either party refuses to enter interest arbitration, upon the request of the other, either party may pursue all available judicial remedies. J. During the term of an agreement approved by the Director under subsection 6.310.735.H or 6.310.735.I, the parties may discuss additional terms and, if agreement on any amendments to the agreement are reached, shall submit A-15 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 87 of 117 proposed amendments to the Director, who shall consider the proposed amendment in accordance with the procedures and standards in subsection 6.310.735.H.2. Any proposed amendment shall not go into effect until the Director affirmatively determines its adherence to the provisions of this Chapter 6.310 and that it furthers the provision of safe, reliable and economical for-hire transportation services and the public policy goals set forth in the Preamble to and Section 1 of the ordinance introduced as C.B. 118499. 1. During the term of an agreement approved by the Director under subsection 6.310.735.H or 6.310.735.I, the Director shall have the authority to withdraw approval of the agreement if the Director determines that the agreement no longer adheres to the provisions of this Chapter 6.310 or that it no longer promotes the provision of safe, reliable, and economical for-hire transportation services and the public policy goals set forth in the Preamble to and Section 1 of the ordinance introduced as C.B. 118499. The Director shall withdraw such approval only after providing the parties with written notice of the proposed withdrawal of approval and the grounds therefor and an opportunity to be heard regarding the proposed withdrawal. The Director’s withdrawal of approval shall be effective only upon the issuance of a written explanation of the reasons why the agreement on longer adheres to the provisions of this Chapter 6.310 or no longer furthers the provision of safe, reliable, and economical for-hire transportation services or the public policy goals set forth in the Preamble to and Section 1 of the ordinance introduced as C.B. 118499. 2. The Director shall have the authority to gather and consider any necessary evidence in exercising the authority provided by this subsection 6.310.735.J. 3. A driver coordinator shall not make changes to subjects set forth in subsection 6.310.735.H or specified in rules or regulations promulgated by the Director without meeting and discussing those changes in good faith with the EDR, even if the driver coordinator and EDR have not included terms concerning such subjects in their agreement. K. A driver coordinator shall not retaliate against any for-hire driver for exercising the right to participate in the representative process provided by this section 6.310.735, or provide or offer to provide money or anything of value to any forhire driver with the intent of encouraging the for-hire driver to exercise, or to refrain from exercising, that right. It shall be a violation for a driver coordinator or its agent, designee, employee, or any person or group of persons acting A-16 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 88 of 117 directly or indirectly in the interest of the driver coordinator in relation to the for-hire driver to: 1. Interfere with, restrain, or deny the exercise of, or the attempt to exercise, any right protected under this section 6.310.735; or 2. Take adverse action, including but not limited to threatening, harassing, penalizing, or in any other manner discriminating or retaliating against a driver, because the driver has exercised the rights protected under this section 6.310.735. L. Decertification. An Exclusive Driver Representative may be decertified according to the following: 1. The Director receives a petition to decertify an EDR no more than 30 days before the expiration of an agreement reached pursuant to this section 6.310.735 or no less than three years after the agreement’s effective date, whichever is earlier. a. A decertification petition must be signed by ten or more qualifying drivers. The Director shall determine by rule the standards and procedures for submitting the decertification petition. 2. Once a petition has been accepted by the Director, the Director shall issue notice to the driver coordinator and the EDR of the decertification petition and promulgate a decertification date. 3. The driver coordinator shall have 14 days from the decertification date to transmit the list of qualifying drivers to the petitioners and the EDR. 4. Within 120 days of receiving the driver contact information, petitioners for a decertification will submit to the Director statements of interest from a majority of qualifying drivers from the list described in subsection 6.310.735.K.3. The statements of interest shall be signed and dated and shall clearly indicate that the driver no longer wants to be represented by the EDR for the purpose of collective bargaining with the driver coordinator. The Director shall determine by rule the standards and procedures for submitting and verifying the statements of interest of qualifying drivers. 5. Within 30 days of receiving such statements of interest, the Director shall determine if they are sufficient to decertify the EDR for that particular driver coordinator. The Director shall either decertify the EDR, or declare that the decertification petition did not meet the majority threshold and reaffirm that A-17 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 89 of 117 the EDR shall continue representing all drivers for that particular driver coordinator. a. If an EDR is decertified for a particular driver coordinator, the process of selecting a new EDR may start according to the process outlined in subsection 6.310.735.G. M. Enforcement 1. Powers and duties of Director a. The Director is authorized to enforce and administer this section 6.310.735. The Director shall exercise all responsibilities under this section 6.310.735 pursuant to rules and regulations developed under Chapter 3.02. The Director is authorized to promulgate, revise, or rescind rules and regulations deemed necessary, appropriate, or convenient to administer the provisions of this section 6.310.735, providing affected entities with due process of law and in conformity with the intent and purpose of this section 6.310.735. b. The Director shall investigate alleged violations of subsections 6.310.735.D and 6.310.735.H.1, and if the Director determines that a violation has occurred, the Director shall issue a written notice of the violation. The Director may investigate alleged violations of other subsections of this section 6.310.735, and if the Director determines that a violation has occurred, the Director shall issue a written notice of the violation. The notice shall: 1) Require the person or entity in violation to comply with the requirement; 2) Include notice that the person or entity in violation is entitled to a hearing before the Hearing Examiner to respond to the notice and introduce any evidence to refute or mitigate the violation, in accordance with Chapter 3.02; and 3) Inform the person or entity in violation that a daily penalty of up to $10,000 for every day the violator fails to cure the violation will accrue if the violation is uncontested or found committed. c. The person or entity named on the notice of violation must file with the Hearing Examiner’s Office the request for a hearing within ten calendar A-18 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 90 of 117 days after the date of the notice of violation. The Hearing Examiner may affirm, modify, or reverse the Director’s notice of violation. d. If the person or entity named on the notice of violation fails to timely request a hearing, the notice of violation shall be final and the daily penalty of up to $10,000 will accrue until the violation is cured. e. Nothing in this section 6.310.735 shall be construed as creating liability or imposing liability on the City for any non-compliance with this section 6.310.735. 2. Judicial review. After receipt of the decision of the Hearing Examiner, an aggrieved party may pursue all available judicial remedies. 3. Private right of action. Subsections 6.310.735.D, 6.310.735.E, 6.310.735.H, and 6.310.735.K may be enforced through a private right of action. Any aggrieved party, including but not limited to an EDR, may bring an action in court, and shall be entitled to all remedies available at law or in equity appropriate to remedy any violation of this section 6.310.735. A plaintiff who prevails in any action against a private party to enforce this section 6.310.735 may be awarded reasonable attorney’s fees and costs. 4. Contractual remedies. Nothing in this section shall be construed as preventing the parties to an agreement approved by the Director from pursuing otherwise available remedies for violation of such agreement. (Ord. 125132 , § 2, 2016; Ord. 124968 , § 3, 2015.) Seattle, Wash. Ordinance No. 124968 AN ORDINANCE relating to taxicab, transportation network company, and for-hire vehicle drivers; amending Section 6.310.110 of the Seattle Municipal Code; adding a new Section 6.310.735 to the Seattle Municipal Code; and authorizing the election of driver representatives. WHEREAS, the state of Washington, in Revised Code of Washington 46.72.001 and 81.72.200, has authorized political subdivisions of the state to regulate for-hire drivers and for-hire transportation services without facing liability under federal antitrust laws; and WHEREAS, allowing taxicab, transportation network company, and for-hire vehicle drivers (“for-hire drivers”) to modify specific agreements A-19 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 91 of 117 collectively with the entities that hire, direct, arrange, or manage their work will better ensure that they can perform their services in a safe, reliable, stable, cost-effective, and economically viable manner and thereby promote the welfare of the people; and WHEREAS, the new responsibilities for the Department of Finance and Administrative Services (FAS) contemplated in this legislation will require additional resources; and WHEREAS, the Director of FAS has authority to adjust fees to cover the cost of the regulatory functions FAS performs on behalf of the public; and WHEREAS, should this legislation go into effect, the Director may exercise that authority to raise additional revenue through fees to cover the additional costs; NOW, THEREFORE, BE IT ORDAINED BY THE CITY OF SEATTLE AS FOLLOWS: Section 1. Findings A. In order to protect the public health, safety and welfare, The City of Seattle is granted express authority to regulate for-hire and taxicab transportation services pursuant to Chapters 46.72 and 81.72 RCW. This authority includes regulating entry, requiring a license, controlling rates, establishing safety requirements, and any other requirement to ensure safe and reliable transportation services. B. Seattle Municipal Code (SMC) Chapter 6.310 is an exercise of The City of Seattle’s power to regulate the for-hire and taxicab transportation industry. SMC Chapter 6.310, in subsection 6.310.100.A, states: “Some of its regulatory purposes are to increase the safety, reliability, cost-effectiveness, and the economic viability and stability of privately-operated for-hire vehicle and taxicab services within The City of Seattle.” C. The purpose of this ordinance is to ensure safe and reliable for-hire and taxicab transportation service pursuant to RCW 46.72.160 and RCW 81.72.210, respectively, and to exercise the City’s authority to regulate for-hire transportation pursuant to RCW 46.72.001, which states: “The legislature finds and declares that privately operated for hire transportation service is a vital part of the transportation system within the state. Consequently, the safety, reliability, and stability of privately operated for hire transportation services are matters of statewide A-20 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 92 of 117 importance. The regulation of privately operated for hire transportation services is thus an essential governmental function. Therefore, it is the intent of the legislature to permit political subdivisions of the state to regulate for hire transportation services without liability under federal antitrust laws.” RCW 81.72.200, governing taxicab transportation, has a similar statement of legislative intent. D. As the City is acting under specific state statutory authority, it is immune from liability under antitrust laws. E. At present, entities that hire, contract with, or partner with for-hire drivers for the purpose of assisting them with, or facilitating them in, providing for-hire transportation services to the public establish the terms and conditions of their contracts with their drivers unilaterally, and may impose changes in driver compensation rates or deactivate drivers from dispatch services without prior warning or discussion. Terms and conditions that are imposed without meaningful driver input, as well as sudden and/or unilateral contract changes, may adversely impact the ability of a for-hire driver to provide transportation services in a safe, reliable, stable, cost-effective, and economically viable manner. F. Unilateral terms and working conditions established and imposed without driver input by entities that hire, contract with, or partner with for-hire drivers, as well as sudden and/or unilateral changes in those terms and conditions, have resulted in driver unrest and transportation service disruptions around the country. G. There is currently no effective mechanism for for-hire drivers to meaningfully address the terms and conditions of their contractual relationship with the entity that hires, contracts with, or partners with them. For-hire drivers lack the power to negotiate these issues effectively on an individual basis. H. Business models wherein companies control aspects of their drivers’ work, but rely on the drivers being classified as independent contractors, render for-hire drivers exempt from minimum labor requirements established by federal, state, and local law. I. Establishing a process through which for-hire drivers and the entities that control many aspects of their working conditions collectively negotiate the terms of the drivers’ contractual relationships with those entities will enable more stable working conditions and better ensure that drivers can perform their services in a safe, reliable, stable, cost-effective, and economically viable manner, and thereby A-21 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 93 of 117 promote the welfare of the people who rely on safe and reliable for-hire transportation to meet their transportation needs. 1. Drivers working under terms that they have negotiated through a collective negotiation process are more likely to remain in their positions over time, and to devote more time to their work as for-hire drivers, because the terms are more likely to be satisfactory and responsive to the drivers’ needs and concerns. Such drivers accumulate experience that will improve the safety and reliability of the for-hire transportation services provided by the driver coordinator and reduce the safety and reliability problems created by frequent turnover in the for-hire transportation services industry. 2. Establishing the drivers’ contractual terms through a collective negotiation process will also help ensure that the compensation drivers receive for their services is sufficient to alleviate undue financial pressure to provide transportation in an unsafe manner (such as by working longer hours than is safe, skipping needed breaks, or operating vehicles at unsafe speeds in order to maximize the number of trips completed) or to ignore maintenance necessary to the safe and reliable operation of their vehicles. Enabling driver participation in the formulation of vehicle equipment standards and safe driving practices will help. ensure that those standards and practices are responsive to driver needs, including changing conditions, and that drivers will agree with and follow those standards and practices. J. Collective negotiation processes in other industries have achieved public health and safety outcomes for the general public and improved the reliability and stability of the industries at issue including, but not limited to, job security provisions, scheduling predictability, job training, methods of communicating health and safety information and enforcing health and safety standards, processes for resolving disputes with minimal rancor or conflict, and reductions in industrial accidents, vehicular accidents, and inoperative or malfunctioning equipment. In other parts of the transportation industry, for example, collective negotiation processes have reduced accidents and improved driver and vehicle safety performance. Section 2. Section 6.310.110 of the Seattle Municipal Code, last amended by Ordinance 124524, is amended as follows: 6.310.110 Definitions A-22 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 94 of 117 *** “Commencement date” means a calendar date set by the Director after the effective date of the ordinance introduced as Council Bill 118499 for the purpose of initiating certain processes pursuant to Section 6.310.735 and establishing timelines and deadlines associated with them. *** “Director” means the Director of Finance and Administrative Services or the director of any successor department and the Director’s authorized designee. “Driver coordinator” means an entity that hires, contracts with, or partners with for-hire drivers for the purpose of assisting them with, or facilitating them in, providing for-hire services to the public. For the purposes of this definition, “driver coordinator” includes but is not limited to taxicab associations, for-hire vehicle companies, and transportation network companies. “Exclusive driver representative” (EDR) means a qualified driver representative, certified by the Director to be the sole and exclusive representative of all for-hire drivers operating within the City for a particular driver coordinator, and authorized to negotiate, obtain and enter into a contract that sets forth terms and conditions of work applicable to all of the for-hire drivers employed by that driver coordinator. *** “Personal vehicle” means a vehicle that is not a taxicab or for-hire vehicle licensed under this ((chapter)) Chapter 6.310. A personal vehicle that is used to provide trips via a transportation network company application dispatch system is subject to regulation under this ((chapter)) Chapter 6.310. “Qualifying driver” means a for-hire driver, who drives for a driver coordinator and who satisfies the conditions established by the Director pursuant to Section 6.310.735. In establishing such conditions, the Director shall consider factors such as the length, frequency, total number of trips, and average number of trips per driver completed by all of the drivers who have performed trips in each of the four calendar months immediately preceding the commencement date, for a particular driver coordinator, and any other factors that indicate that a driver’s work for a driver coordinator is significant enough to affect the safety and A-23 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 95 of 117 reliability of for-hire transportation. A for-hire driver may be a qualifying driver for more than one driver coordinator. “Qualified driver representative” (QDR) means an entity that assists for-hire drivers operating within the City for a particular driver coordinator in reaching consensus on desired terms of work and negotiates those terms on their behalf with driver coordinators. *** Section 3. A new Section 6.310.735 is added to the Seattle Municipal Code as follows: 6.310.735 Exclusive driver representatives A. The Director shall promulgate a commencement date that is no earlier than 180 days and no later than 240 days from the effective date of the ordinance introduced as Council Bill 118499. B. The process of designating a QDR shall be prescribed by Director’s rule. The designation of a QDR shall be based on, but not limited to, consideration of the following factors: 1. Registration with the Washington Secretary of State as a not-for-profit entity; 2. Organizational bylaws that give drivers the right to be members of the organization and participate in the democratic control of the organization; and 3. Experience in and/or a demonstrated commitment to assisting stakeholders in reaching consensus agreements with, or related to, employers and contractors. C. An entity wishing to be considered as a QDR for for-hire drivers operating within the City must submit a request to the Director within 30 days of the commencement date or at a later date as provided in subsection G of this section. Within 14 days of the receipt of such a request, the Director will notify the applicant in writing of the determination. Applicants who dispute the Director’s determination may appeal to the Hearing Examiner within 10 days of receiving the A-24 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 96 of 117 determination. The Director shall provide a list of all QDRs to all driver coordinators. 1. An entity that has been designated as a QDR shall be required to establish annually that it continues to satisfy the requirements for designation as a QDR. 2. An entity that has been designated as a QDR and that seeks to represent the drivers of a driver coordinator shall notify the driver coordinator of its intent to represent those drivers within 14 days of its designation as a QDR. That notice may be provided by any means reasonably calculated to reach the driver coordinator, including by written notice mailed or delivered to a transportation network company or taxicab association representative at the mailing address listed with the City. D. Driver coordinators who have hired, contracted with, partnered with, or maintained a contractual relationship or partnership with, 50 or more for-hire drivers in the 30 days prior to the commencement date, other than in the context of an employer-employee relationship, must, within 75 days of the commencement date, provide all QDRs that have given the notice specified in subsection 6.310.735.C.2 the names, addresses, email addresses (if available), and phone number (if available) of all qualifying drivers they hire, contract with, or partner with. E. QDRs shall use driver contact information for the sole purpose of contacting drivers to solicit their interest in being represented by the QDR. The QDR may not sell, publish, or otherwise disseminate the driver contact information outside the entity/organization. F. The Director shall certify a QDR as the EDR for all drivers contracted with a particular driver coordinator, according to the following: 1. Within 120 days of receiving the driver contact information, a QDR will submit statements of interest to the Director from a majority of qualifying drivers from the list described in subsection 6.310.735.D. Each statement of interest shall be signed, dated, and clearly state that the driver wants to be represented by the QDR for the purpose of negotiations with the driver coordinator. A qualifying driver’s signature may be provided by electronic signature or other electronic means. The A-25 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 97 of 117 Director shall determine by rule the standards and procedures for submitting and verifying statements of interest by qualifying drivers choosing an EDR. a. The methods for submitting and verifying statements of interest by qualifying drivers choosing an EDR may include, but not be limited to: signature verification, unique personal identification number verification, statistical methods, or third party verification. 2. Within 30 days of receiving such statements of interest, the Director shall determine if they are sufficient to designate the QDR as the EDR for all drivers for that particular driver coordinator, and if so, shall so designate the QDR to be the EDR, except that, if more than one QDR establishes that a majority of qualifying drivers have expressed interest in being represented by that QDR, the Director shall designate the QDR that received the largest number of verified affirmative statements of interest to be the EDR. 3. Within 30 days of receiving submissions from all QDRs for a particular driver coordinator, the Director shall either certify one to be the EDR or announce that no QDR met the majority threshold for certification. G. If no EDR is certified for a driver coordinator, the Director shall, upon the written request from a designated QDR or from an entity that seeks to be designated as a QDR, promulgate a new commencement date applicable to that driver coordinator that is no later than 90 days after the request, provided that no driver coordinator shall be subject to the requirements of Section 6.310.735 more than once in any 12-month period. The QDR, any other entity that seeks to be designated as a QDR, and the driver coordinator shall then repeat the processes in subsections 6.310.735.C, 6.310.735.D, and 6.310.735.F. H. 1. Upon certification of the EDR by the Director, the driver coordinator and the EDR shall meet and negotiate in good faith certain subjects to be specified in rules or regulations promulgated by the Director, including, but not limited to, best practices regarding vehicle equipment standards; safe driving practices; the manner in which the driver coordinator will conduct criminal background checks of all prospective drivers; the nature and amount of payments to be made by, or withheld from, the driver coordinator to or by the drivers; minimum hours of work, conditions of A-26 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 98 of 117 work, and applicable rules. If the driver coordinator and the EDR reach agreement on terms, their agreement shall be reduced to a written agreement. The term of such an agreement shall be agreed upon by the EDR and the driver coordinator, but in no case shall the term of such an agreement exceed four years. 2. After reaching agreement, the parties shall transmit the written agreement to the Director. The Director shall review the agreement for compliance with the provisions of this Chapter 6.310, and to ensure that the substance of the agreement promotes the provision of safe, reliable, and economical for-hire transportation services and otherwise advance the public policy goals set forth in Chapter 6.310 and in the Preamble to and Section 1 of the ordinance introduced as C.B. 118499. In conducting that review, the record shall not be limited to the submissions of the EDR and driver coordinator nor to the terms of the proposed agreement. The Director shall have the right to gather and consider any necessary additional evidence, including by conducting public hearings and requesting additional information from the EDR and driver coordinator. Following this review, the Director shall notify the parties of the determination in writing, and shall include in the notification a written explanation of all conclusions. Absent good cause, the Director shall issue the determination of compliance within 60 days of the receipt of an agreement. a. If the Director finds the agreement compliant, the agreement is final and binding on all parties. b. If the Director finds it fails to comply, the Director shall remand it to the parties with a written explanation of the failure(s) and, at the Director’s discretion, recommendations to remedy the failure(s). c. The agreement shall not go into effect until the Director affirmatively determines its adherence to the provisions of this Chapter 6.310 and that the agreement furthers the provision of safe, reliable, and economical for-hire transportation services and the public policy goals set forth in the Preamble to and Section 1 of the ordinance introduced as C.B. 118499. 3. Unless the EDR has been decertified pursuant to subsection 6.310.735.L or has lost its designation as a QDR, the EDR and the driver A-27 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 99 of 117 coordinator shall, at least 90 days before the expiration of an existing agreement approved pursuant to subsections 6.310.735.H.2.c or 6.310.735.I.4.c, meet to negotiate a successor agreement. Any such agreement shall be subject to approval by the Director pursuant to subsection 6.310.735.H.2. If the parties are unable to reach agreement on a successor agreement within 90 days after the expiration of an existing agreement, either party must submit to interest arbitration upon the request of the other pursuant to subsection 6.310.735.1, and the interest arbitrator’s proposed successor agreement shall be subject to review by the Director pursuant to subsections 6.310.735.1.3 and 6.310.735.1.4. 4. Nothing in this section 6.310.735 shall require or preclude a driver coordinator from making an agreement with an EDR to require membership of for-hire drivers in the EDR’s entity/organization within 14 days of being hired, contracted with, or partnered with by the driver coordinator to provide for-hire transportation services to the public. I. If a driver coordinator and the EDR fail to reach an agreement within 90 days of the certification of the EDR by the Director, either party must submit to interest arbitration upon the request of the other. 1. The interest arbitrator may be selected by mutual agreement of the parties. If the parties cannot agree, then the arbitrator shall be determined as follows: from a list of seven arbitrators with experience in labor disputes and/or interest arbitration designated by the American Arbitration Association, the party requesting arbitration shall strike a name. Thereafter the other party shall strike a name. The process will continue until one name remains, who shall be the arbitrator. The cost of the interest arbitration shall be divided equally between the parties. 2. The interest arbitrator shall propose the most fair and reasonable agreement concerning subjects specified in rules or regulations promulgated by the Director as set forth in subsection 6.310.735.H.1 that furthers the provision of safe, reliable, and economical for-hire transportation services and the public policy goals set forth in the Preamble to and Section 1 of the ordinance introduced as C.B. 118499. The term of any agreement proposed by the interest arbitrator shall not exceed two years. In proposing that agreement, the interest arbitrator shall consider the following criteria: A-28 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 100 of 117 a. Any stipulations of the parties; b. The cost of expenses incurred by drivers (e.g., fuel, wear and tear on vehicles, and insurance); c. Comparison of the amount and/or proportion of revenue received from customers by the driver coordinators and the income provided to or retained by the drivers; d. The wages, hours, and conditions of employment of other persons, whether employees or independent contractors, employed as for-hire or taxicab drivers in Seattle and its environs, as well as other comparably sized urban areas; e. If raised by the driver coordinator, the driver coordinator’s financial condition and need to ensure a reasonable return on investment and/or profit; f. Any other factors that are normally or traditionally taken into consideration in the determination of wages, hours, and conditions of employment; and g. The City’s interest in promoting the provision of safe, reliable, and economical for-hire transportation services and otherwise advancing the public policy goals set forth in Chapter 6.310 and in the Preamble to and Section 1 of the ordinance introduced as C.B. 118499. 3. The arbitrator shall transmit the proposed agreement to the Director for review in accordance with the procedures and standards set forth in subsection 6.310.735.H.2. With the proposed agreement, the arbitrator shall transmit a report that sets forth the basis for the arbitrator’s resolution of any disputed issues. The Director shall review the agreement as provided in subsection 6.310.735.H.2. 4. In addition to the review provided for in subsection 6.310.735.1.3, a driver coordinator or EDR may challenge the proposed agreement on the following grounds: that the interest arbitrator was biased, that the interest arbitrator exceeded the authority granted by subsection 6.310.735.H and this subsection 6.310.735.1, and/or that a provision of the proposed agreement is arbitrary and capricious. In the event of such a challenge, A-29 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 101 of 117 the Director will provide notice to the driver coordinator and the EDR, allow the driver coordinator and the EDR the opportunity to be heard, and make a determination as to whether any of the challenges asserted should be sustained. a. If the Director finds the agreement fulfills the requirements of subsection 6.310.735.H.2, and that no challenges raised under this subsection 6.310.735.1.4 should be sustained, the Director will provide written notice of that finding to the parties and the agreement will be deemed final and binding on all parties. b. If the Director finds that the agreement fails to fulfill the requirements of subsection 6.310.735.H.2, or that any challenge asserted under this subsection 6.310.735.1.4 should be sustained, the Director shall remand the agreement to the interest arbitrator with a written explanation of the failure(s) and, at the Director’s discretion, recommendations to remedy the failure(s). c. The agreement shall not go into effect until the Director affirmatively deems the agreement final and binding pursuant to subsections 6.310.735.1.3 and 6.310.735.1.4.a. d. A driver coordinator or EDR may obtain judicial review of the Director’s final determination rendered pursuant to this subsection 6.310.735.1.4 by applying for a Writ of Review in the King County Superior Court within 14 days from the date of the Director’s determination, in accordance with the procedure set forth in Chapter 7.16 RCW, other applicable law, and court rules. The Director’s final determination shall not be stayed pending judicial review unless a stay is ordered by the court. If review is not sought in compliance with this subsection 6.310.735.1.4.d, the determination of the Director shall be final and conclusive. 5. If either party refuses to enter interest arbitration, upon the request of the other, either party may pursue all available judicial remedies. J. During the term of an agreement approved by the Director under subsection 6.310.735.H or 6.310.735.1, the parties may discuss additional terms and, if agreement on any amendments to the agreement are reached, shall submit proposed amendments to the Director, who shall consider the proposed amendment A-30 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 102 of 117 in accordance with the procedures and standards in subsection 6.310.735.H.2. Any proposed amendment shall not go into effect until the Director affirmatively determines its adherence to the provisions of this Chapter 6.310 and that it furthers the provision of safe, reliable and economical for-hire transportation services and the public policy goals set forth in the Preamble to and Section 1 of the ordinance introduced as C.B. 118499. 1. During the term of an agreement approved by the Director under subsection 6.310.735.H or 6.310.735.1, the Director shall have the authority to withdraw approval of the agreement if the Director determines that the agreement no longer adheres to the provisions of this Chapter 6.310 or that it no longer promotes the provision of safe, reliable, and economical for-hire transportation services and the public policy goals set forth in the Preamble to and Section 1 of the ordinance introduced as C.B. 118499. The Director shall withdraw such approval only after providing the parties with written notice of the proposed withdrawal of approval and the grounds therefor and an opportunity to be heard regarding the proposed withdrawal. The Director’s withdrawal of approval shall be effective only upon the issuance of a written explanation of the reasons why the agreement on longer adheres to the provisions of this Chapter 6.310 or no longer furthers the provision of safe, reliable, and economical for-hire transportation services or the public policy goals set forth in the Preamble to and Section 1 of the ordinance introduced as C.B. 118499. 2. The Director shall have the authority to gather and consider any necessary evidence in exercising the authority provided by this subsection 6.310.735.J. 3. A driver coordinator shall not make changes to subjects set forth in subsection 6.310.735.H or specified in rules or regulations promulgated by the Director without meeting and discussing those changes in good faith with the EDR, even if the driver coordinator and EDR have not included terms concerning such subjects in their agreement. K. A driver coordinator shall not retaliate against any for-hire driver for exercising the right to participate in the representative process provided by this section 6.310.735, or provide or offer to provide money or anything of value to any for-hire driver with the intent of encouraging the for-hire driver to exercise, or to refrain from exercising, that right. It shall be a violation for a driver coordinator or A-31 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 103 of 117 its agent, designee, employee, or any person or group of persons acting directly or indirectly in the interest of the driver coordinator in relation to the for-hire driver to: 1. Interfere with, restrain, or deny the exercise of, or the attempt to exercise, any right protected under this section 6.310.735; or 2. Take adverse action, including but not limited to threatening, harassing, penalizing, or in any other manner discriminating or retaliating against a driver, because the driver has exercised the rights protected under this section 6.310.735. L. Decertification. An Exclusive Driver Representative may be decertified according to the following: 1. The Director receives a petition to decertify an EDR no more than 30 days before the expiration of an agreement reached pursuant to this section 6.310.735 or no less than three years after the agreement’s effective date, whichever is earlier. a. A decertification petition must be signed by ten or more qualifying drivers. The Director shall determine by rule the standards and procedures for submitting the decertification petition. 2. Once a petition has been accepted by the Director, the Director shall issue notice to the driver coordinator and the EDR of the decertification petition and promulgate a decertification date. 3. The driver coordinator shall have 14 days from the decertification date to transmit the list of qualifying drivers to the petitioners and the EDR. 4. Within 120 days of receiving the driver contact information, petitioners for a decertification will submit to the Director statements of interest from a majority of qualifying drivers from the list described in subsection 6.310.735.K.3. The statements of interest shall be signed and dated and shall clearly indicate that the driver no longer wants to be represented by the EDR for the purpose of collective bargaining with the driver coordinator. The Director shall determine by rule the standards and procedures for submitting and verifying the statements of interest of qualifying drivers. A-32 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 104 of 117 5. Within 30 days of receiving such statements of interest, the Director shall determine if they are sufficient to decertify the EDR for that particular driver coordinator. The Director shall either decertify the EDR, or declare that the decertification petition did not meet the majority threshold and reaffirm that the EDR shall continue representing all drivers for that particular driver coordinator. a. If an EDR is decertified for a particular driver coordinator, the process of selecting a new EDR may start according to the process outlined in subsection 6.310.735.G. M. Enforcement 1. Powers and duties of Director a. The Director is authorized to enforce and administer this section 6.310.735. The Director shall exercise all responsibilities under this section 6.310.735 pursuant to rules and regulations developed under Chapter 3.02. The Director is authorized to promulgate, revise, or rescind rules and regulations deemed necessary, appropriate, or convenient to administer the provisions of this section 6.310.735, providing affected entities with due process of law and in conformity with the intent and purpose of this section 6.310.735. b. The Director shall investigate alleged violations of subsections 6.310.735.D and 6.310.735.H.1, and if the Director determines that a violation has occurred, the Director shall issue a written notice of the violation. The Director may investigate alleged violations of other subsections of this section 6.310.735, and if the Director determines that a violation has occurred, the Director shall issue a written notice of the violation. The notice shall: 1) Require the person or entity in violation to comply with the requirement; 2) Include notice that the person or entity in violation is entitled to a hearing before the Hearing Examiner to respond to the notice and introduce any evidence to refute or mitigate the violation, in accordance with Chapter 3.02; and A-33 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 105 of 117 3) Inform the person or entity in violation that a daily penalty of up to $10,000 for every day the violator fails to cure the violation will accrue if the violation is uncontested or found committed. c. The person or entity named on the notice of violation must file with the Hearing Examiner’s Office the request for a hearing within ten calendar days after the date of the notice of violation. The Hearing Examiner may affirm, modify, or reverse the Director’s notice of violation. d. If the person or entity named on the notice of violation fails to timely request a hearing, the notice of violation shall be final and the daily penalty of up to $10,000 will accrue until the violation is cured. e. Nothing in this section 6.310.735 shall be construed as creating liability or imposing liability on the City for any non-compliance with this section 6.310.735. 2. Judicial review. After receipt of the decision of the Hearing Examiner, an aggrieved party may pursue all available judicial remedies. 3. Private right of action. Subsections 6.310.735.D, 6.310.735.E, 6.310.735.H, and 6.310.735.K may be enforced through a private right of action. Any aggrieved party, including but not limited to an EDR, may bring an action in court, and shall be entitled to all remedies available at law or in equity appropriate to remedy any violation of this section 6.310.735. A plaintiff who prevails in any action against a private party to enforce this section 6.310.735 may be awarded reasonable attorney’s fees and costs. 4. Contractual remedies. Nothing in this section shall be construed as preventing the parties to an agreement approved by the Director from pursuing otherwise available remedies for violation of such agreement. Section 4. The provisions of this ordinance are declared to be separate and severable. The invalidity of any clause, sentence, paragraph, subdivision, section, or portion of this ordinance, or the invalidity of its application to any person or circumstance, does not affect the validity of the remainder of this ordinance, or the validity of its application to other persons or circumstances. A-34 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 106 of 117 Section 5. Sections 2 and 3 of this ordinance shall take effect and be in force 150 days after the effective date of the ordinance introduced as Council Bill 118499. Section 6. No provision of this ordinance shall be construed as a providing any determination regarding the legal status of taxicab, transportation network company, and for-hire vehicle drivers as employees or independent contractors. The provisions of this ordinance do not apply to drivers who are employees under 29 U.S.C. § 152(3). Section 7. Should a court of competent jurisdiction, all appeals having been exhausted or all appeal periods having run, determine that any provision of this ordinance is preempted by federal law, any and all such provisions shall be deemed null and void. Section 8. This ordinance shall take effect and be in force 30 days after its approval by the Mayor, but if not approved and returned by the Mayor within ten days after presentation, it shall take effect as provided by Seattle Municipal Code Section 1.04.020. Passed by the City Council the 14th day of December, 2015, and signed by me in open session in authentication of its passage this 14 th day of December, 2015. s/ Tim Burgess President of the City Council Approved by me this day of , 2015. Edward B. Murray, Mayor Filed by me this 23rd day of December, 2015. s/ Monica M. Simmons Monica Martinez Simmons, City Clerk A-35 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 107 of 117 Director’s Rule FHDR-1, Qualifying Driver and Lists of Qualifying Drivers * (SMC 6.310.110, .735.D and .735.E) Introduction The following Rule establishes the conditions that define a Qualifying Driver as authorized by the Seattle Municipal Code (SMC). In adopting the Rule, the Director has considered the available data regarding trips by for-hire drivers, discussions with and survey responses from drivers, standards established by other jurisdictions for granting persons the right to vote and to be represented in negotiations pertaining to the terms and conditions of employment and the factors set forth in the SMC, and has established conditions that indicate that a driver’s work for a Driver Coordinator is significant enough to affect the safety and reliability of for-hire transportation in that the driver has a sufficient stake in and knowledge of conditions that affect the safety and reliability of that Driver Coordinator’s for-hire transportation services. Qualifying Driver A qualifying driver is a for-hire driver licensed under the SMC who meets the following conditions: Was hired by or began contracting with, partnering with or maintaining a contractual relationship with a particular Driver Coordinator at least 90 days prior to the commencement date;1 and Drove at least 52 trips originating or ending within the Seattle city limits for a particular Driver Coordinator during any three-month period in the 12 months preceding the commencement date. A trip is defined as transporting a passenger from one place to another for compensation. * Director’s Rules FHDR-1 and FHDR-7 as produced here are the versions in effect as of Friday, May 26, 2017. The original versions of these rules can be found at ER 128 (FHDR-1) and ER 160 (FHDR-7). 1 The initial commencement date is January 17, 2017. Ninety days prior to the initial commencement date is October 19, 2016 and 12 months prior is January 17, 2016. Subsequent commencement dates will be promulgated by the Director pursuant to the SMC. A-36 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 108 of 117 o Any driver who is an active member of the U.S. military and could not provide trips because he/she was deployed on a military assignment outside of the greater Seattle area will qualify if he/she drove at least 52 trips originating or ending within the Seattle city limits for a particular Driver Coordinator during any three-month period in the 24 months preceding the commencement date. A trip is defined as transporting a passenger from one place to another for compensation. The driver must provide documentation corroborating the deployment and trips driven to the Director for inspection and to confirm qualification. The City recognizes that a driver may drive for multiple Driver Coordinators and may be a qualifying driver for more than one Driver Coordinator. For purposes of determining whether a driver is a “qualifying driver” under the provisions of the SMC, a Driver Coordinator should count only the trips driven by the driver for that particular Driver Coordinator. Nothing in this Rule or in the SMC will be construed to require or authorize a Driver Coordinator to ask drivers to identify themselves as driving for another Driver Coordinator. Lists of Qualifying Drivers Created by Driver Coordinators Within 14 calendar days of its designation as a Qualified Driver Representative (QDR), or within 58 days of the commencement date if the QDR has previously been designated, a QDR will notify a Driver Coordinator of its intent to represent those drivers.2 Driver Coordinators that hire, contract with or partner with 50 or more non-employee for-hire drivers for the purpose of assisting them with, or facilitating them in, providing for-hire services to the public (which may include taxicab associations, for-hire vehicle companies, TNCs or other entities) will then create qualifying driver lists (driver list) based on the conditions established by this 2 Per the SMC, a Driver Coordinator will not be subject to the requirements of a driver representation effort associated with a specified commencement date more than once in any 12-month period. The 12-month period begins on the date a Driver Coordinator transmits a list of its qualifying drivers to any QDR. However, if the FAS Director determines that a Driver Coordinator has willfully delayed transmittal of the list in violation of the SMC, then the FAS Director has discretion to specify that the 12-month period begins on the date that the list was due. For any specified commencement date, however, more than one QDR may attempt to organize the drivers of the same Driver Coordinator. A-37 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 109 of 117 Rule. The accuracy of a driver list’s content is the responsibility of the Driver Coordinator creating it, not the City’s responsibility. A driver list will include all drivers who satisfy the specified conditions above. After a QDR gives a Driver Coordinator notice as specified in the SMC, a Driver Coordinator will produce and transmit the list of qualifying drivers to the QDR within 75 calendar days of the commencement date. That same list will later be used to ascertain whether a QDR has obtained statements of interest from a majority of qualifying drivers. A Driver Coordinator will notify the City by e-mail (DriverRepresentation@seattle.gov) of the date the driver list was transmitted to a QDR. A QDR will notify the City by e-mail (DriverRepresentation@seattle.gov) of the date the driver list was received from a Driver Coordinator. The notifications will not include a copy of the driver list. At a minimum, a driver list will include the following information for all nonemployee qualifying drivers working for a Driver Coordinator: 1. Name (last name, first name and middle initial) 2. Mailing address 3. E-mail address (if available) 4. Phone number (if available) 5. Valid for-hire driver license/permit number (issued by King County/City of Seattle)3 A Driver Coordinator will make a driver list available in an electronic format such as an Excel spreadsheet that allows a QDR to read, sort and organize the driver information/data supplied. A scanned document presented in the Portable Document Format (PDF), for example, does not meet the standard under this Rule. A Driver Coordinator will devise and employ a way to securely transfer driver lists to a QDR and to secure, through password protection or other means, access to those lists. 3 For purposes of creating a list of qualifying drivers, a driver must possess a valid (i.e., unexpired or, if expired, expired for no more than 60 days) for-hire driver license/permit on the date the list is created. Sixty days is given as a grace period while an expired license/permit goes through the renewal process. A-38 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 110 of 117 Per the SMC, a QDR will use driver lists solely for the purpose of contacting drivers to solicit their interest in being represented by the QDR. A QDR may not sell, publish or otherwise disseminate driver contact information outside the QDR, the QDR’s employees and the QDR’s agents. A QDR must take all reasonable steps to ensure that another party does not misuse the list. A QDR will be held responsible if another party misuses the list provided by a Driver Coordinator to that QDR. Violations of this provision by a QDR and/or another party will be addressed through the enforcement processes specified in the SMC. Director’s Rule FHDR-2, Application Process for Designating a Qualified Driver Representative (SMC 6.310.110 and .735.C) The following Rule establishes the application process to designate a Qualified Driver Representative (QDR) as authorized by the Seattle Municipal Code. The QDR renewal process and associated deadlines will appear in a separate rule. Application Any organization wishing to apply to be designated a QDR must meet all of the following qualifications: 1. Be registered with the Washington Secretary of State as a nonprofit corporation. 2. Have organizational bylaws that give for-hire drivers the right to be members of the organization and participate in the democratic control of the organization. 3. Have experience in and/or a demonstrated commitment to assisting stakeholders in reaching consensus agreements with, or related to, employers and contractors. 4. Does not interfere with, restrain or coerce4 drivers in the exercise of their right to decide whether to authorize the QDR to represent them, their right to become members of or refrain from membership in the QDR or any other right protected 4 The Director will rely primarily on Washington State Public Employment Relations Commission (PERC) cases and secondarily upon federal National Labor Relations Board authority to interpret the terms “interfere with, restrain or coerce” and “dominate or control.” A-39 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 111 of 117 in the SMC. This will not impair the right of a QDR or EDR to prescribe its own rules with respect to the acquisition or retention of membership therein. 5. Is not dominated or controlled by any current Driver Coordinator and does not receive any financial support from a Driver Coordinator. Domination or control will mean that the Driver Coordinator has assisted and supported the QDR’s operation and activities to such an extent that it must be looked at as the Driver Coordinator’s creation. An organization seeking such designation must submit information on a City supplied application form with following sections: Section 1 Organization’s name and contact information (mailing address, phone number and email address) Section 2 Designated representative, which includes the name of and contact information (mailing address, phone and e-mail address) for the person representing the organization and certifying the application on the organization’s behalf; the person must be vested with authority to manage or direct the affairs of the organization or to bind the organization in dealings with third parties Section 3 Proof of nonprofit status, which includes either a Unified Business Identifier (UBI) number or a certificate of formation from the Washington Secretary of State Section 4 Current bylaws a. The bylaws will need to include language allowing for-hire drivers to be members of the organization and to participate in democratic control of the organization b. The organization will highlight relevant language in a copy of the bylaws provided to the City Section 5 Statement of experience and/or commitment A-40 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 112 of 117 a. The statement will highlight commitment to and/or experience with, including any specific and relevant examples, assisting stakeholders in reaching consensus agreements with, or related to, employers and contractors b. The statement will be 1,500 words or less and include three references for the organization itself (name and contact information for each reference) Section 6 Disclosures a. Answers to questions and, if applicable, explanations of those answers provided as attachments to the application form. Questions will cover: i. Financial indebtedness, if any, and funding sources, ii. Financial support received from any current Driver Coordinator, iii. Involvement by current and former City employees, iv. Compliance/criminal background and v. Any parent or affiliated organization. Section 7 Certification a. An original signature and date from the organization’s representative At the Director’s discretion, the City may require an organization to submit additional information to assist decision-making on the QDR designation. Within 14 calendar days of receipt of the application, or, if requested by the Director, receipt of additional information from the applicant, the City will notify applying entities by e-mail whether they have been designated a QDR. To facilitate communication between a QDR and Driver Coordinator, the City will make available on a City website the names and contact information for all designated QDRs and all known Driver Coordinators. An organization’s designation as a QDR by the City does not guarantee that the QDR will be designated as an EDR. A QDR must continuously meet the qualifications described in this Rule to maintain its QDR designation. If at any time the Director determines that an entity no longer meets the QDR qualifications A-41 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 113 of 117 described in this Rule, the Director will withdraw the entity’s QDR status. The Director’s decision can be appealed to the Hearing Examiner per the SMC. Director’s Review and Determination Upon receipt of an application, the Director will perform an initial screen of all application materials for completeness. If the application has a material omission or misstatement, then the Director will deny it outright. For sections 3 and 4 of the application, the Director will assign either a pass or a fail. To determine whether an organization has sufficient experience in or commitment to reaching consensus agreements (section 5), the Director will consider factors including, but not limited to, the organization’s bylaws, constitution, or other evidence of its purposes and functions; the length of time the organization and/or the person or persons vested with authority to manage or direct the affairs of the organization has assisted stakeholders in reaching consensus agreements with, or related to, employers and contractors; the number of consensus agreements reached; the number of persons covered by the consensus agreements; and the nature and number of activities/campaigns demonstrating a commitment to reaching consensus agreements and the outcome of those activities/campaigns. For the various disclosures covered under section 6, the Director has the discretion to consider any affirmative response and its supporting explanation to reasonably determine whether the organization can or cannot fulfill the QDR responsibilities and requirements set forth in the SMC. The Director also has the discretion to consider any allegations that an entity seeking QDR designation is dominated or controlled by, or receives any financial support from, any current Driver Coordinator. Timeline The City will open the QDR application period in connection with the initial commencement date as well as any subsequent commencement dates established. A prospective QDR’s application materials, including disclosures, will be made publicly available via a City website. An organization applying to be designated as a QDR will observe the following key dates: Initial commencement date: January 17, 2017 15 calendar days before commencement date: City makes applications publicly available A-42 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 114 of 117 Commencement date: first day applications accepted by the City 30 calendar days after commencement date: last day applications accepted by the City Various dates: the City will notify the organization, by e-mail, of its determination within 14 calendar days of receipt of application or additional information, if requested by the Director Various dates: an applicant may appeal the City’s determination to the Office of Hearing Examiner within 10 calendar days of receiving the determination Various dates: a QDR that has been designated as a QDR by the City following a commencement date and seeks to represent a particular Driver Coordinator’s drivers will notify that Driver Coordinator within 14 calendar days of being designated as a QDR.5 A QDR that has been designated prior to a commencement date will notify a Driver Coordinator of intent to represent its drivers within 58 calendar days6 of any subsequent commencement date. The QDR must reasonably plan its notification to ensure it reaches the Driver Coordinator. Notice sent by U.S. mail, personal delivery or e-mail to a Driver Coordinator using contact information available from the City will be deemed to comply with this obligation. Appeals: in the event of an appeal of the Director’s determination by a QDR applicant, all applicable deadlines may be suspended at the Director’s discretion; 5 Per the SMC, a Driver Coordinator will not be subject to the requirements of a driver representation effort associated with a specified commencement date more than once in any 12-month period. The 12-month period begins on the date a Driver Coordinator transmits a list of its qualifying drivers to any QDR. However, if the FAS Director determines that a Driver Coordinator has willfully delayed transmittal of the list in violation of the SMC, then the FAS Director has discretion to specify that the 12-month period begins on the date that the list was due. For any specified commencement date, however, more than one QDR may attempt to organize the drivers of the same Driver Coordinator. 6 The 58 calendar days is the sum of the time that an applicant obtaining designation as a QDR following a commencement date would have to give such notice: 30 calendar days (for a prospective QDR to apply for City designation), 14 days (for the City to make a determination on the prospective QDR’s application) and 14 days (for a designated QDR to inform a Driver Coordinator of its intent to represent drivers). A-43 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 115 of 117 in that event, after the appeal is decided, the deadlines will resume per the schedule specified by the SMC. Director’s Rule FHDR-4, Subjects of Bargaining between a Driver Coordinator and an Exclusive Driver Representative (SMC 6.310.735.H.1) Introduction This Rule establishes the subjects of bargaining between a Driver Coordinator and an Exclusive Driver Representative (EDR) and associated business processes as they pertain to for-hire drivers and as authorized by the Seattle Municipal Code (SMC). Mandatory Subjects of Bargaining For purposes of this Rule, the City defines mandatory subjects of bargaining as those that directly affect whether for-hire drivers can perform their services in a safe, reliable and economically viable manner. The following subjects, as outlined in the SMC, will be mandatory subjects of bargaining during negotiations between a Driver Coordinator and an EDR: 1. Best practices regarding vehicle equipment standards 2. Safe driving training and/or practices 3. The manner in which the driver coordinator will conduct criminal background checks of all prospective drivers 4. The nature and amount of payments to be made by, or withheld from, the driver coordinator to or by the drivers 5. Minimum hours of work 6. Drivers’ conditions of work 7. Rules that apply to drivers including discipline, termination or deactivation In addition, whether for-hire drivers will be required to become members of or make other payments to an EDR will be a mandatory subject. Other than contract provisions that would be illegal or unenforceable or not in compliance with the SMC, the City defines all other subjects not listed in this Rule as permissive subjects. A-44 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 116 of 117 Parties may not refuse to reach an agreement within 90 calendar days of certification of an EDR based on disagreement about a permissive subject; nor will a permissive subject be submitted to interest arbitration unless both the Driver Coordinator and the EDR agree that the matter should be resolved by interest arbitration. Whether for-hire drivers will be required to become members of or make other payments to an EDR also will not be submitted to interest arbitration unless both the Driver Coordinator and the EDR agree to that submission. Good Faith Negotiations Per the SMC, a Driver Coordinator and an EDR will meet and negotiate, in good faith, the mandatory subjects of bargaining. Permissive subjects may be negotiated if both the Driver Coordinator and the EDR agree to such negotiations. Good faith negotiations generally mean each party has an obligation to make individuals with decision-making authority available at mutually agreed-upon dates and times and to actively participate in negotiations in a manner that indicates a sincere desire and effort to reach common ground. The City will hold both a Driver Coordinator and an EDR to this standard. Complaint Process Allegations that a Driver Coordinator or EDR has violated an obligation in relation to the 90-day negotiation process, including alleged failure to negotiate in good faith, may be submitted to the Director in writing by U.S. mail, personal delivery or e-mail within 10 calendar days of the alleged occurrence. The party making the complaint will include specific circumstances of the allegations of bad faith and any documentation to corroborate the allegations. If such an allegation is filed, as part of its investigation, the Director will notify the party that is the subject of the allegation of the nature of the allegation and copies of all materials submitted as part of the complaint and the opportunity to respond. Written responses, including any documentation to refute the allegations, must be submitted to the Director by U.S. mail, personal delivery or e-mail within 10 calendar days of such notice. Based on a preponderance of the evidence submitted, the Director will issue a written ruling on any objections within 14 calendar days of the deadline for filing written responses. If deemed necessary to a full and fair investigation, the Director has discretion to request additional evidence or materials from either party and to extend the deadline for issuing a written ruling. A-45 Case: 17-35693, 12/01/2017, ID: 10675522, DktEntry: 25, Page 117 of 117 If the Director concludes that the Driver Coordinator or EDR did not negotiate in good faith or otherwise violated the SMC, the Director will then will issue a notice of violation, require compliance and inform the violator of daily penalties of up to $10,000 for failure to cure, and is additionally authorized to establish a new deadline after which either party may submit a request for interest arbitration if that remedy is requested by the party making the allegation. The party found in violation may exercise hearing rights before the Hearing Examiner and all available judicial remedies as provided for in the SMC. Post-Agreement Negotiations Per the procedures and standards set forth in the SMC, the Director may withdraw approval of an agreement between an EDR and a Driver Coordinator. If that occurs, the EDR and Driver Coordinator will meet and negotiate in good faith with the purpose of reaching a new agreement, and the SMC provisions that apply to negotiations of successor agreements will apply. Aside from that situation, an EDR and Driver Coordinator may elect to discuss additional terms and, if agreement is reached, will submit proposed amendments to the agreement to the Director for review and approval. Either the EDR or Driver Coordinator may decline to reopen the agreement to discuss the additional terms. A-46