NLRB Acting General Counsel Peter Ohr is moving swiftly to put his stamp on national labor policy.   Last week, my partner Andrew MacDonald blogged about Ohr’s withdrawal of a complaint that had challenged the use of a neutrality agreement by an employer and a union.  Ohr also rescinded several General Counsel Memoranda issued by his predecessor that, according to Ohr, were “inconsistent” with national labor policy.   While the none of the withdrawn memoranda were particularly critical to employers’ labor relations prerogatives, the speed with which Ohr moved is notable, as is his pronouncement that national labor policy is “to encourage the practice and procedure of collective bargaining and the protection of workers’ exercise of their full freedom of association, self-organization and designation of representatives of their own choosing for [collective bargaining].”

Moreover, with regard to the withdrawal of certain Memoranda, Ohr’s actions might be seen as putting the interests of unions ahead of employees.   In this regard, Ohr withdrew GC 19-01, in which Ohr’s predecessor had sought a change in Board law to require unions raising a “mere negligence” defense to a “duty of fair representation claim” concerning a union’s grievance handling to establish the existence of established, reasonable procedures or systems in place to track grievances.   In practice, this means that unions who fail to properly handle employee grievances are less likely to be held accountable through the NLRB’s procedures.  Correspondingly, Ohr withdrew GC 19-04, which had urged the Board to require unions to be more transparent and accommodating to employees seeking to withdraw their authorization for union dues payroll deductions and GC 18-06, which was intended to facilitate employee participation in unfair labor practice cases involving union decertification.   Again, none of these decisions are particularly impactful to employers’ rights and prerogatives under the Act, but, collectively they move the needle somewhat in favor of unions.

Likely a harbinger of things to come at the Board . . . .

In his first few days on the job, Acting General Counsel of the NLRB Peter Sung Ohr has withdrawn a complaint that had challenged the use of a neutrality agreement by an employer and union.  This early move by the Acting GC indicates the direction that he will take in attempting to change the course of labor law during the Biden Administration.

In general, a neutrality agreement contains a promise from the employer to remain neutral during a union organizing drive in exchange for the union’s promise not to strike or publicly disparage the employer.  The former NLRB GC who brought the case at issue, Peter Robb, also issued a guidance memorandum that characterized most neutrality agreements as unlawful because they provided illegal assistance to a unions.  (For a more detailed article about that memo, see our previous post here).  Former GC Robb issued the complaint against the employer and the union based on this theory of unlawful union assistance provided by the employer and accepted by the union.

Reversing course, Acting GC Ohr’s ordered the complaint to be withdrawn based on his prosecutorial discretion, stating that, in his view, the neutrality agreement at issue did not violate the law.  Essentially, the Acting GC’s action brings the sometimes murky law on the legal boundaries of neutrality agreements back to the status quo.

This action by the Acting GC demonstrates the power of that office to select the cases that will reach the NLRB and potentially change precedent.  In addition, the withdrawal of the complaint sends a powerful signal to employers and unions that the NLRB will not be policing neutrality agreements outside of the few defined boundaries established in prior precedent.  Unions are likely to be especially receptive to this signal and view it as an early victory in the policy shift on labor issues under the new administration.

Andrew MacDonald is a partner in the firm’s Labor and Employment Department, resident in its Philadelphia office.

In an unprecedented action that delighted organized labor but sounded alarm bells for employers, in one of his first acts, President Biden  fired the General Counsel and Deputy General Counsel of the National Labor Relations Board.   On January 25, the White House appointed Peter Sung Ohr to serve as Acting General Counsel.   Mr. Ohr long has served as the Regional Director of the Board’s Chicago office and is perhaps best known for his controversial decision several years ago that scholarship football players at Northwestern University were “employees” who had legal standing to unionize under the National Labor Relations Act.   The abrupt ouster of General Counsel Robb is significant because virtually all private sector employers are covered by the National Labor Relations Act (“NLRA”), regardless of their size or whether their employees are unionized, and the General Counsel has the power to issue complaints against alleged labor law violators and shape the legal theories presented to the Board, which impacts the development of the law.   Relatedly, Acting General Counsel Ohr may withdraw complaints in a number of high profile cases pending against unions, including one involving whether “Scabby the Rat” is subject to the provisions of the Act prohibiting secondary boycotts.  Under the law, Mr. Ohr may serve in an acting capacity for up to forty (40) days, so it is likely that the Administration will present a nominee for consideration by the Senate in the next several weeks.   Moreover, President Biden will be able to appoint two (2) new members to the Board later this year (subject to Senate confirmation) which likely will cement a pro-union majority on the Board for the next four years.  The new Board Members and General Counsel almost certainly will work to bend national labor policy to favor unions at the expense of employers.   During the campaign, President Biden promised to be the most “pro-union President in history,” and these early moves suggest he intends to make good on that promise.

The NLRB’s General Counsel recently issued a memo that demonstrates his hostility toward neutrality agreements.  Generally, neutrality agreements contain a promise from an employer that it will remain neutral in a union organizing campaign.  These agreements often contain other provisions, such as allowing unions access to employer property to address employees and providing unions with employee contact information.  In return, a union often promises employers that employees will not strike.

Initially, it is extremely important to note that the General Counsel’s views are not binding as NLRB precedent.  Only the Board itself can change its precedent, either by way of its decisions in NLRB cases or through rulemaking.  It is also unclear what the composition of the Board will be if/when any cases come before it under the theories set forth in the General Counsel’s Memo.   While the General Counsel cannot change NLRB law, he is in charge of brining cases before the NLRB by way of issuing complaints.  In this regard, the memo signals that he will prosecute cases based on neutrality agreements deemed to be unlawful.

The NLRA prohibits employers from providing assistance to a union seeking to organize its employees.  That said, the NLRB has historically allowed cooperation between employers and unions regarding organizing, but has prohibited certain forms of assistance.  “Cooperation” crosses the line to unlawful “assistance” when it interferes with employees’ free choice in selecting whether a union will represent them or not.

Somewhat surprisingly, the topic of neutrality agreements as tools of unlawful assistance has not frequently come before the Board in the past.  Aside from ruling that an employer and union cannot bargain for a full collective bargaining agreement before the union represents a majority of employees, the Board has generally left unions and employers free to enter into neutrality agreements.

The memo marks an important turn in this area of the law.  The General Counsel provides examples of neutrality agreement provisions that would be considered violations of the NLRA under his proposal.  Some examples include provisions that are common in most, if not all, neutrality agreements.  Examples include:

  1. Allowing union organizers to access employer facilities (even during non-working time).
  2. Allowing union solicitation (by employees or non-employees) during working time.
  3. Providing unions with employee contact information.
  4. Agreeing to some limited CBA terms before certification that a majority of employees support the union, including: (a) interest arbitration to set the terms of a CBA if bargaining fails and (b) no-strike / no lockout provisions (although the union could agree that it would not call for or encourage employees to strike).

If adopted by the Board, the proposals contained in the memo would render common provisions of neutrality agreements unlawful.  Even prior to a Board ruling, however, unions and employers could be subject to unfair labor practice charges from objecting rival unions or employees pursuant to the General Counsel’s memo.  Again, the General Counsel decides which cases to bring before the Board, so the signal contained in this memo strongly indicates that he is prepared to prosecute cases that involve these types of neutrality agreements.

But, what about the election?  Wouldn’t President-Elect Biden replace the General Counsel?  As it turns out, the General Counsel’s five-year term overlaps any change in Presidential administrations.  The current General Counsel will be in his position until 2022, and will have the power to bring neutrality agreement cases before the Board anytime during his tenure.

Andrew MacDonald is a partner in the firm’s Labor and Employment Department, resident in its Philadelphia office.

In an early May 2020 decision, the Board declared a temporary pause in charged parties (usually an employer) complying with the NLRB’s standard notice posting remedy in response to the ongoing COVID-19 public health crisis. Thereafter, on May 20, 2020, General Counsel Peter B. Robb issued GC Memo 20-06 and made this temporary change applicable to informal settlement agreements (as a notice posting is typical in such arrangements).

A party that is liable for violations of the Act and/or who enters into a settlement agreement will need to post a notice within 14 days of a decision being issued, or execution and approval of an agreement (the notice is usually served by the involved NLRB Regional office). As known to traditional labor practitioners, notices must be physically posted somewhere at the facility where all employees have access to it and remain posted for 60 consecutive days. Additionally, an employer must distribute a notice electronically (e.g., Intranet, email, etc.) if it customarily communicates with employees in such fashion. However, with the closures of businesses around the country due to the Coronavirus, the remedial effect of notice postings has been hindered because there are minimal-to-no employees working at some of the facilities where notices must be put up. As such, a notice posting has proven not to be an effective way of advising employees of violations of the Act and their rights under federal labor law – the purposes of the notice – since employees are not around to read it.

Understanding this reality, the Board and General Counsel announced and implemented the aforementioned temporary delays in relation to remedial notices. For now, Employers (or union charged parties) do not need to post and/or electronically distribute notices “within 14 days” of service . If a facility is currently closed or is open and operating with less than a substantial complement of employees, then the 60 consecutive day notice period for posting will begin when a facility reopens and a substantial complement of employees have returned to work. A “substantial complement” is at least 50% of the total number of employees working before the COVID-19 related closing occurred. That said, an employer who reopens and is required to electronically distribute notices does not need to wait until a substantial number of employees return to work, and must – if appropriate – email the notices as soon as the workplace reopens.

These changes to remedial notices do not apply to charged parties that have remained opened and staffed with a substantial complement of employees during the Coronavirus pandemic. As noted by the Board, a return to the standard timeline for notices will happen when “conditions warrant” but, until then, these directives are applicable. Stay tuned for what happens next.

Summer Associate Kelly McNaughton contributed to this blog post.  

On June 17, 2020, National Labor Relations Board General Counsel Peter Robb issued GC Memo 20-08 (“Memo”), providing Regional offices new directives for taking certain witness testimony and accepting audio/video recording evidence in unfair labor practice (“ULP”) investigations.

First, the Memo instructs Regions allow a charged party – in most cases an employer – to be present and observe the “substantive communications” with a former supervisor or agent if that individual is now testifying against the charged party about a contested action, e.g., terminating an employee for union activity. Regional staff is to “apprise the party or its representative in advance of communicating with the individual about the substance of the matter” and afford the charged party the opportunity “to be present for the taking of any affidavit.” This guidance applies even if jurisdictional skip counsel rules would not prohibit communications with the former supervisor or agent. It does not apply, however, if an individual is only a “fact witness” (an inquiry requiring further communications with the NLRB Ethics Office and Operations). Similarly, if a former supervisor or agent has their own counsel, does not want the charged party’s representative present, and/or where the charged party’s attorney wants to participate as more than an observer, the Region should contact the Ethics Office.

Next, and perhaps most significant, this Memo discusses changes to the Board’s standard in accepting and using recording evidence. The NLRB has historically relied on recording evidence – whether or not surreptitiously and/or unlawfully obtained in violation of federal or state wiretap laws or work policies – to investigate and prosecute ULP charges. This often led to employers being blindsided at trial or during settlement negotiations with evidence that they did not know existed nor been given an opportunity to address. Now, pursuant to the Memo, there will be a level of transparency at the investigative stage of a ULP case that never existed before.

New Guidance on Recordings Proffered During ULP Investigations:

  • 1) Regional employees – e., Field Examiners and Board attorneys – investigating ULP charges should not receive “recordings they know to have been made without the consent of any participant in the conversation and with an expectation of privacy.”
    • Regions should consult with the Ethics Office when this is in doubt.
  • 2) Regions will alert charged parties, before making merit determinations, that they possess highly relevant recordings, offer to play the recordings for them, and solicit the charged party’s position on the recordings.
    • However, Regions will deny charged party requests for copies of the recordings.
  • 3) Regions will advise the individual or party offering the recording, before receiving the actual recording, about the Region’s potential use of the evidence, e., sharing it with the charged party, and put them on notice about the possible breach of any law or work rule that may have occurred in making the recording.
    • Individuals will be advised concerning prosecution or civil claim possibilities if the recording was made unlawfully or, if made in violation of a workplace policy, potential adverse employment consequences.

Notably, the Memo does not outright prohibit Regions from accepting a recording that may have been made in violation of a statute or employment policy. Regions may continue accepting such evidence, provided they follow the above-referenced framework so that a “person can make an informed choice as to whether or not to provide a recording to the Region” in the first place.

While some argue that this Memo hamstrings NLRB staffers’ ability to investigate ULP charges, provides a level of “discovery” not allowed under the Act, and may lead to deterring whistleblowers from coming forward, Agency leadership correctly disavows of this criticism. The Memo, as described by an NLRB spokesperson to Bloomberg Law, aims to provide “timely relief for individuals whose rights have been violated … by ensuring that Regions candidly disclose appropriate evidence accumulated during the investigation phase.” Further, in terms of advising those parties or individuals proffering recording evidence, the guidance is “intended to protect them, not to intimidate them.”

In sum, management-side practitioners should rejoice at the changes this Memo brings to NLRB cases. Employers will no longer be surprised with recording evidence they never even knew existed (and possibly illegally obtained) and, generally, ULP investigations will take a more even-handed approach moving forward.

On April 29, 2020, the Ninth Circuit Court of Appeals affirmed a National Labor Relations Board decision where an employer was lawfully permitted to refuse a union’s request for financial information because it appropriately clarified its previous “inability to pay” statements and explained that it was only unwilling, not unable, to meet the union’s wage demands. 

Normally, when an employer justifies its bargaining position by claiming an inability to pay a union’s demands, the union may request financial documents sufficient to substantiate the employer’s position. The Supreme Court held in NLRB v. Truitt Mfg. Co., 351 U.S. 149, 153-54 (1956), that a union is entitled to an employer’s financial information when an employer bases its bargaining position on an asserted inability to pay. That said, the NLRB has long held that a union is generally not entitled to this information without an employer claiming an inability to pay across the bargaining table. In this regard, the Ninth Circuit noted that an employer “asserting an unwillingness to pay a union’s demands during negotiations is different than asserting a financial inability to pay” and such an employer “does not have a duty to produce information about its financial viability upon request from the union.”

In the instant case, the employer initially told the union it would be committing “suicide” and put the company “underwater” if it granted the union’s wage demands, statements that the employer conceded constituted an inability to pay position.  Thereafter, however, the employer further explained its bargaining stance and stated how “no employer in this business would pay such a wage to its hourly workforce that was so grossly outside of its business model and if it did so, it would be suicide for the company.” This, the employer clarified, was “not an inability to pay for lack of revenue” but rather “a refusal to pay an hourly rate that would be detrimental to the business.” In affirming the NLRB, the Court held that the employer’s subsequent explanation established a proper disavowal of its previous inability to pay statements, and that the employer had a legal right to do so.

Ultimately, the Court found that the overall weight and substance of the employer’s bargaining position was an unwillingness to pay the union’s wage demands. The Court noted that “[n]ot every financially-motivated decision by an employer establishes … an [in]ability to pay” and, to this end, the employer not referencing “financial nonviability after retracting its inability-to-pay claim” reinforced its finding that the employer was simply unwilling to pay, not unable.

Any employer bargaining with a union must be careful not to make inability-to-pay-type statements during negotiations, or otherwise risk opening up its financial records to a union. This case helps solidify the NLRB’s current position on when employers may lawfully withhold turning over financial information to a union and, specifically, how employers can retract/disavow prior inability to pay claims under certain conditions. The guidance in this case should provide helpful tips for those employers taking an unwillingness – not an inability – to pay stance during contract negotiations.

By announcement on April 1, 2020, the NLRB resumed representation elections beginning on April 6, 2020.  Previously, the NLRB had suspended elections until April 3, 2020.  The details on elections will be decided on a case-by-case basis by the Board’s regional directors.

Board Chairman John F. Ring provided the following reasons for resuming elections:  “Conducting representation elections is core to the NLRB’s mission, and ensuring elections are carried out safely and effectively is one of our primary responsibilities. Two weeks ago, when the Board made the difficult decision to suspend elections, the developing situation made it impossible to ensure the safety of our employees or the public. With many regional offices closed and most employees teleworking, the Board was not confident that any type of election could be run effectively. Based on these concerns, the Board determined that a two-week suspension would provide the General Counsel, who is delegated authority to supervise the regional offices, which conduct elections on the Board’s behalf, the opportunity to fully review the logistics of the election procedures in light of the unprecedented situation. The General Counsel now has advised that appropriate measures are available to permit elections to resume in a safe and effective manner, which will be determined by the Regional Directors. We appreciate the patience and understanding of all NLRB stakeholders during this challenging time.”

Andrew MacDonald is an associate in the firm’s Labor and Employment Department, resident in its Philadelphia office.

Private sector employers with unionized employees and even non-union employees must be especially careful when addressing certain workforce concerns connected with the coronavirus outbreak.  Below, we will address common issues that may arise in union facilities during this crisis. Management & Labor Report - Default Social Share Image

Analyze the Contract Before Making Changes to the Workforce

If there is a current collective bargaining agreement (CBA), it may provide the employer with the authority to make workplace changes, such as reducing schedules or laying off employees, to address the crisis. Even if the agreement does not expressly reference the right to reduce schedules or lay off employees, recent case law from the National Labor Relations Board (NLRB) allows for employer action if the contract generally covers the employer’s ability to take such action. Employers must also be prepared to satisfy any obligations attendant to taking actions such as layoffs, which could include payment of PTO or other benefits. In these situations, it is very important to review the entire collective bargaining agreement to be prepared for the consequences of drastic decisions.

What if the CBA restricts the employer’s ability to reduce schedules or lay off employees? Generally, an employer or union can refuse to even discuss modifications to contract provisions during the term of a CBA. This does not mean that an employer cannot propose changes to the agreement to avoid more drastic consequences such as complete shutdown or closure. Employers should engage with unions to attempt to achieve compromise if the CBA inhibits an employer’s ability to take necessary action.

If There Is no CBA, Changes to the Workforce Are Subject to Bargaining

If there is no CBA in place, or an existing contract does not cover the measures contemplated by the employer, any changes to the workforce would be subject to the duty to bargain. The National Labor Relations Act (NLRA) requires employers and unions to bargain over subjects including wages, hours and other terms and conditions of employment (often referred to as the “mandatory subjects of bargaining”), which would include many actions taken by employers in this crisis. These subjects would include negative measures such as layoffs, and would even include positive measures such as hazard pay for employees. Where the duty to bargain applies, the employer would need to reach agreement or impasse in negotiations with the union before making unilateral changes regarding mandatory subjects of bargaining.

Exigent Circumstances and the Duty to Bargain Over Effects

Government closures or current economic conditions may excuse bargaining due to exigent circumstances, but employers’ duty to participate in effects bargaining duty remains. NLRB case law allows for an exception to the duty to bargain in extreme circumstances where “economic exigencies … compel prompt action.” This exception has been construed extremely narrowly and is limited in duration, but in view of the current events, employers would be well-advised to closely examine whether this exception applies. If the “economic exigency” exception to the duty to bargain applies, an employer would not need to bargain with a union over the decision to close a facility or take some drastic action to comply with government orders or survive economically in these trying times.

Where there is a CBA in place, there may be provisions that address the manner in which employees are treated in terms of pay and benefits when they are put out of work due to a closure. For example, if employees are laid off as a result of the closure, then the CBA’s provisions governing layoffs would dictate the outcome.

But, where there is no CBA in place, or the CBA does not address the relevant issues related to the closure, the duty to bargain continues. The duty to bargain embraces not just decisions made by employers, but the effects of an employer’s actions, even if an employer lawfully made a decision regarding a mandatory subject without bargaining regarding that subject. Therefore, even if “exigent circumstances” would permit an employer to act without bargaining – such as when it is ordered to shut down operations by government authorities – a union could demand to bargain over the effects of that decision, including severance pay, extension of benefits or rights of employees to return to work after the order is lifted.

Be Prepared for Strikes, Refusals to Work, or Other Protected Concerted Activity

The NLRA guarantees all employees, not just employees represented by unions, the right to strike or to collectively refuse to work. However unionized employees are more likely to strike than others.

Most CBAs contain no-strike clauses, which prohibit the employees from striking. Those provisions prevent strikes, unless the conditions at the work location are “abnormally dangerous,” which could arise under the current circumstances, on a case-by-case basis, depending on many factors such as the presence of coronavirus in the workplace and the nature of the workplace (e.g. hospital or office building).

If there is no CBA – or even if employees are not represented by a union – employees could strike, refuse to work or engage in other forms of protected activity to pressure employers to change working conditions during the crisis or to attempt to extract benefits from employers following layoffs or reductions in schedules. In addition, employees may be protected under federal labor law if they refuse to work in a concerted manner due to fear of coronavirus in the workplace.

Employers Are Obligated to Pay Federal Paid Sick Leave

Recently enacted federal laws obligating employers to paid up to 80 hours of paid sick leave and expanded paid Family and Medical Leave Act (FMLA) leave are not negated or affected by existing CBAs. Unionized employers will be required to provide these new benefits in addition to benefits like paid leave that are contained in their union contracts.

Carefully Evaluate When to Act, When to Negotiate, and When to do Both – or Neither

Managing union represented workforce can be challenging at the best of times. The coronavirus and the accompanying economic circumstances do not make it any easier. For employers with union relationships, the best way through this crisis may often, but not always, be to work with unions to try to arrive at a negotiated agreement regarding modified terms which respond to the crisis with an outcome that balances the well-being of the business and the interests of employees in these trying times.

Each employer will need to review the issues we have discussed with a mind to the particular industry in which it operates and the tenor of the relationship with the union at its facilities.

Andrew MacDonald is an associate in the firm’s Labor and Employment Department, resident in its Philadelphia office.

Robert Nagle is a partner in the firm’s Labor and Employment Department, resident in its Blue Bell, PA office.

Robert Castle is a partner in the firm’s Labor and Employment Department, resident in its Minneapolis office.

Employers have been privileged to withdraw recognition of a union when presented with objective evidence that the union has lost majority support of employees, but have faced significant legal risks in doing so under NLRB precedent.  Some of this legal risk has been mitigated by the NLRB’s decision in Johnson Controls, Inc., 368 NLRB No. 20 (July 3, 2019).  This decision not only clarifies some aspects of the law in this area, but also presents a new framework for addressing the issue of “anticipatory withdrawal” of recognition by an employer.Management & Labor Report - A Fox Rothschild Blog

The law surrounding withdrawal of recognition can be highly fact dependent.  One major issue of concern is whether the employees who are expressing discontent against their union are covered by a current collective bargaining agreement (“CBA”).  The law for decades has been that an employer cannot withdraw recognition of a union during the term of a CBA because, while a CBA is in effect, the union enjoys an irrebuttable presumption of majority support.  This means that even if a majority of employees do not actually support the union, their employer cannot cease recognizing the union as their bargaining agent.  While this rule is supported by lofty goal of maintaining stability in economic relations, it can thwart the will of employees who, for various reasons, desire to oust their union.  It also places employers in the precarious position of recognizing a union that may not enjoy the support of a majority of employees.

The tension between stable economic relationships and majority will of employees was eased to some extent by the NLRB’s “anticipatory withdrawal” doctrine.  This rule allows an employer to announce, near the time of contract expiration, that it would withdraw recognition at the end of an existing CBA if it received objective evidence, usually in the form of a petition from employees, that they no longer supported the union.  Before the decision in Johnson Controls, Inc., anticipatory withdrawal allowed the employer to continue to recognize the union and honor the CBA until the term ran out, while making it clear that it will no longer do so after the CBA expired, therefore supporting the twin goals of stability and employee majority will.

The “anticipatory withdrawal” doctrine, however, had its faults.  One major fault was that, after employees presented the employer with evidence of lack of majority support, the union could “re-organize” the employees and regain the support of a majority of employees.  Once the union regained a majority, which was often done without employer knowledge, the employer would be facing legal risk by carrying out its plan to withdraw recognition.  For example, if there was an employee petition expressing lack of majority support, those who had signed the petition given to the employer could, in secret, sign a new union authorization card and renege on their expression of lack of union support.  The NLRB had held that the “last in time” rule governed this process, so that the employer acted at its peril in withdrawing recognition from the union without specific knowledge that some employees may have changed their minds.

Johnson Controls remedies the “last in time” problem by allowing an employer to anticipatorily withdraw recognition based on objective evidence that the union has lost majority support of employees without worrying about whether the union will reacquire majority support.  Once the employer anticipatorily withdraws, the union must file an election petition to formally regain authorization from the employees.  The ruling sets a 45-day deadline for the union to file the election petition, which begins on the date on which the employer announces anticipatory withdrawal of recognition.

Johnson Controls also clarified the rule by defining the “reasonable” time period to announce anticipatory withdrawal.  Prior to this ruling, NLRB precedent allowed for anticipatory withdrawal if the employer received evidence of loss of majority support within a “reasonable time” before the expiration of a CBA.  The decision expressly marks the timeline as 90 days before expiration.  The NLRB noted that this timeline aligns with the usual time period for filing decertification and rival union election petition between 90 and 60 days prior to contract expiration.

Finally, the NLRB provided several clear explanations for some implications of its ruling.  First, it reiterated, based on precedent, that the employer’s anticipatory withdrawal must be based on objective and untainted (no employer support) evidence that actually demonstrates loss of majority support.  If the union did not actually lose majority support, the employer cannot rely on a reasonable or good faith belief that the union lost the support of employees.  Johnson Controls does not change this rule.  Second, the NLRB warned employers that making unilateral changes to working conditions following anticipatory withdrawal and contract expiration may have consequences, depending on the circumstances.  Essentially, unilateral changes may constitute objectionable conduct for purpose of an election, if the union files a petition to regain support within 45 days of the anticipatory withdrawal, or could constitute unlawful unilateral changes if the union prevails in such an election.  If the union does prevail in the election, then the changes would only be unlawful from the date of “re-certification” on the election date, but not for any time between the proper withdrawal upon expiration of the agreement and the date of the election.

As should be apparent from these warnings from the Board, anticipatory withdrawal, or withdrawal of recognition of any kind for that matter, presents certain legal risk, regardless of the note of clarity struck by the Johnson Controls decision.  Employer’s must, therefore, think critically, and carefully evaluate the risks when considering anticipatory withdrawal.  Consultation with experienced labor Counsel is recommended to fully appreciate all relevant concerns.

George J. “Jerry” Oliver is a partner in the firm’s Labor and Employment Department, resident in its Raleigh office.

Andrew MacDonald is an associate in the firm’s Labor and Employment Department, resident in its Philadelphia office.