corpcounsel.com | March 18, 2016

Politics in the : A Primer for the 2016 Elections From the Experts Lindsay B. Burke and Robert D. Lenhard

When most corporate counsel hear “work- place politics” mentioned, they probably do not immediately think of the type of politics that results in people being elected to public . But the U.S. Supreme Court’s decision in Citizens United expanded the rights of corpo- rations to engage in political activity, particu- larly concerning their First Amendment right to express their views to the public. With the coming of the 2016 presidential election, and the increased use of mobile technology for personal political activities, corporate counsel should become acquainted with the fast- changing and conflicting laws that regulate electoral politics in the workplace. Managing the company’s involvement in electoral politics used to be a relatively sim- ple matter of ensuring that the PAC was well run, that personal political activities stayed outside the workplace and that if an executive

wanted to engage in personal fundraising, she adamkaz / iStock or he was clear on how the event was to be organized and paid for. No more. personal political activities can more easily cannot be reimbursed by the company. The The 2012 presidential race saw candidate find their way into the workplace. Even the voluntariness of a contribution can be lost if an Mitt Romney urge members of the National FEC-the federal agency responsible for the employer conditions an employee’s compen- Federation of Independent Business to tell neutral enforcement of our nation’s campaign sation, promotion or discharge on whether she their employees whom to vote for, the U.S. finance laws–was embarrassed to find a staff or he contributes to the PAC. Second, only “ex- Chamber of Commerce encourage member lawyer sending personal tweets soliciting con- ecutive and administrative personnel,” share- companies to include political advertisements tributions for a presidential candidate from holders, and their families can be asked to give. in employees’ pay envelopes and it saw the her workplace at the agency. A may now communicate Federal Election Commission (FEC) deadlock What follows is a basic primer for corporate with all employees about candidates, includ- on whether it was illegal for a company to counsel on the laws that apply to politics in ing encouraging them to vote for or against compel its employees to attend a presidential the workplace. particular candidates. Federal law has long campaign rally. Depending on which side one Involving Employees in a Company’s allowed to communicate with is on, these actions were either hailed as pio- Political Activities senior level staff about politics, including spon- neering or decried as manipulative. But one A corporation may ask its employees to soring candidate appearances, recommending thing is certain: The pressure for businesses contribute to a corporate PAC. The law is well who they vote for and encouraging senior staff to be involved in the 2016 elections–and to settled that a company may ask its executive to contribute to particular candidates. involve their employees in the elections–will and administrative personnel to make vol- Since the Supreme Court’s decision in be even greater. At the same time, expanding untary contributions to the company’s PAC. Citizen United, the corporation’s right to com- access to mobile devices and the growing role Two important principles underlie this rule. municate about all of the above now extends of Internet-based political activism means First, contributions must be voluntary and to all company employees, so long as the March 18, 2016 corporation acts independently of federal coerced contributions to a company’s PAC, acknowledge that employees may engage in candidates or political parties. This means that but is silent on other kinds of coerced political a de minimus amount of political activity at companies can broadly and openly discuss behavior. While other federal statutes prohibit work, so long as they continue to perform a with their employees at every level why they , intimidation or remuneration on the normal level of professional duties. The FEC should vote for particular candidates and basis of who an employee votes for or against, also allows employees engaged in volunteer what certain pieces of legislation may mean or whether they vote at all, it is less clear that activity in support of federal candidates to for their business. However, candidate appear- these statutes bar compulsory political activity make occasional, isolated or incidental use of ances in the workplace and fundraising be- not directly related to voting, such as attend- their employer’s equipment and facilities for yond the PAC are murky areas of the law, as are ing a rally in support of an employer’s preferred their political activity. The agency’s regulations questions about whether electoral communi- candidate. create a “safe harbor” for this standard of one cations trigger FEC disclosure obligations and Threatening security, discipline or hour a week or four hours a month. More ex- how “independent” a company must be of a termination for political activity may pres- tensive use of meeting rooms, food services or candidate or political party when it engages ent significant risk under state law. The two activities that increase a company’s incremen- in independent speech. Corporations should FEC decisions discussed above can give a false tal costs should be cleared in advance with seek legal counsel before moving forward sense of comfort to those who only look to legal counsel. with these types of activities. federal election law in assessing risk. Many But given the increased use in the work- Requiring employees to participate in commentators believe that the National Labor place of personal mobile devices, employers company-sponsored political activities re- Relations Act’s bar on threatening employ- may be at a loss as to how to police employee mains risky. The FEC’s regulations have long ees to close a plant or facility if they unionize political activity during work time and en- barred employers from threatening employ- can be extrapolated to bar threats of job loss sure that the rules are observed. How many ees with detrimental job action to compel based on the outcome of at-large elections. tweets make up an hour? Is commenting on them to make contributions to or fundraise And many states have a statutory right to a Facebook page a personal political activity? on behalf of federal candidates or political political freedom that could support a claim For some, a ban on all employee volunteer parties. But in two surprising cases, the FEC of wrongful adverse action, were an employer political activities while on duty or using a failed to find an employer guilty of violating to discipline or discharge an employee for company’s facilities or equipment may seem a federal law by coercing its employees to par- his or her off-duty political activities. While clear and risk-free approach. After all, politics ticipate in political activity. One case involved these statutes are most often drafted to bar can be a divisive issue, may distract from the a labor union attorney, who alleged that she discharge in retaliation for an employee’s in- day-to-day needs of the company and may was discharged for refusing to participate in dependent political activity, some, such as result in allegations of unlawful or harass- union-sponsored independent political activ- those in California, Louisiana and Nebraska, ing conduct if political conversations in the ity to re-elect a local congressperson, includ- are more expansive, and bar efforts to “con- workplace devolve into arguments implicat- ing canvassing and waving campaign signs to trol” or “influence” the political activities of em- ing race, sex, religion or national origin. But passing cars on a local road. Three FEC Com- ployees. Others, such as those in New Jersey, state law should be consulted, and consider- missioners noted: “[The Union]’s independent Oregon and Wisconsin, explicitly bar an em- ation given to whether a ban is evenly applied use of its paid workforce to campaign for a ployer from requiring employees to attend to corporate executives, or is implemented federal candidate post-Citizens United was an employer-sponsored meeting on political despite the company itself communicating not contemplated by Congress and, conse- matters. And some jurisdictions, such as the with employees about politics. quently, is not prohibited by either the Act or District of Columbia, have adopted “political The Bottom Line Commission regulations.” affiliation” as a protected activity under their Freedom comes with a price. For corporate The second case involved a coal company anti-discrimination statutes, suggesting that counsel, the price of the freedom corporations alleged to have required employees to attend any adverse action taken for reasons moti- have won with Citizens United and similar legal a pro-coal rally where a presidential candidate vated by an employee’s political activity may rulings is an increasingly complex world of reg- spoke and the employees were given signs be prohibited. These broader protections may ulation, and perhaps a mistaken mood among to wave encouraging voters to “fire Obama.” be brought to bear in circumstance where many companies that this freedom means Because the event was organized with the discipline arises from a refusal to participate that no rules exist. The truth, unfortunately, is candidate, the company could not avail itself in an employer’s preferred political activity far more complicated. of the exemption in Citizens United for “inde- that conflicts with the employee’s personal pendent” political speech. In this context, the views. Unlike federal law, where the FEC and Lindsay B. Burke is vice chair of Covington FEC staff lawyers concluded it would be a vio- the U.S. Department of Justice have exclusive & Burling’s practice group. Robert lation for a company to require its employees jurisdiction to enforce the statute, many state D. Lenhard is a partner in the firm’s election and to attend the candidate’s rally, but found “the law rights are enforced by a private right of ac- political law practice group. size or significance of the apparent violation tion, either present in the statute or through is not sufficient to warrant further pursuit.” the tort of wrongful discharge in violation of The FEC split 3-3 on whether to dismiss the public policy. matter entirely or begin an investigation, and Employees’ Voluntary Participation in ultimately agreed to simply close the case. Workplace Politics Reprinted with permission from the March 18, 2016 edition of This weakness in prosecution flows in part While an employer may choose to ban po- Corporate Counsel © 2015 ALM Media Properties, LLC. from the Federal Election Campaign Act of litical activity in the workplace, interestingly This article appears online only. All rights reserved. Further duplication without permission is prohibited. For information, 1971, as amended, which clearly prohibits federal law does not require it. The FEC’s rules contact 877-257-3382 or [email protected]. # 016-03-16-06