A Management Perspective On the Need for a Uniform Standard

Board decisions over the last year in Graymont PA, Inc., 364 NLRB No. 37 (June 29,2016) (“Graymont”), Minteq International, Inc., 364 NLRB No. 63 (July 29, 2016) (“Minteq”),and E.I. du Pont de Nemours, 364 NLRB No. 113 (August 26, 2016) (“E.I. du Pont”), resurrect an important question for management and labor representatives alike: When operating under a negotiated management rights clause, what standard should the parties apply to determine if a unilateral change is permitted? When an employer wants to provide new uniforms, change its health care plan, revise its absenteeism policy, or require employees to sign a confidentiality agreement, it must consider whether it is required to provide the union with notice and the opportunity to bargain before implementing the change. When analyzing its duty to bargain over changes that arguably fall under a management rights clause, an employer often protests: “we did that already!” If the employer unilaterally implements these changes, it often prompts the union to question whether the change was lawful and whether it should seek recourse.

Under the current state of law, the answer to whether the parties must bargain over a mandatory subject arguably covered by a management rights clause is: it depends on who decides. According to Board decisions, management rights must be specific, and an employer justifying a unilateral change must demonstrate a “clear and unmistakable waiver” of the right to bargain. Dissenting Board members and several circuit courts have routinely disagreed with the application of this standard, finding that the parties have already bargained, and have instead argued for or applied a “contract coverage” standard. The Board takes the position that it does not have to follow circuit court precedent, because it has the responsibility of ensuring a nationally uniform labor policy and achieving orderly administration of the NLRA. Several circuits, on the other hand, take the position that courts – not the Board – must determine the appropriate standard of review. This is so, because under section 301 of the LMRA, parties to a collective bargaining agreement are entitled to bring a dispute about the interpretation of the contract directly to a federal court. These circuits argue that they owe no deference to the Board because it is not an expert in contract interpretation, and that the Board should leave such questions to courts and arbitrators.

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