The National Labor Relations Board (NLRB) recently issued a flurry of decisions prior to the expiration of Member Gwynne Wilcox’s first term at the end of August. These decisions joined the sweeping changes to NLRB representational procedures announced around the same time. This LawFlash details these shifts in the law and provides key takeaways for employers.

For more information on the previous NLRB representation process changes, refer to our LawFlashes New NLRB Rules Favor Mandatory Union Recognition & Limit Employee Voting in Secret-Ballot Elections and National Labor Relations Board Reinstates ‘Quickie’ Election Rules.

LABOR LAW PROTECTIONS EXTEND TO MORE ‘INDIVIDUAL’ EMPLOYEE ACTIVITY, INCLUDING NONEMPLOYEES

Miller Plastic Products Inc. [1]

The NLRB expanded the definition of “concerted activity” by overruling precedent and returning to the ambiguous “totality of the circumstances” test for determining whether an individual’s actions were “concerted.” [2] The decision increases the risk of employers violating federal labor law when responding to individual employee activity that may violate employer policies or harm the workplace.

Takeaway for Employers

Miller Plastic serves as a warning that the NLRB will perform an exacting factual review to identify any evidence that converts individual activity to actual or potential group activity (i.e., “concerted” activity) under the National Labor Relations Act (NLRA). Employers, in turn, should thoroughly analyze all the facts when making disciplinary decisions for individual misconduct that, to the NLRB, can be deemed protected concerted activity under the NLRA.

American Federation for Children Inc. [3]

The NLRB overruled Amnesty International of the USA Inc. [4] and held that an employee’s “advocacy” on behalf of a nonemployee (e.g., independent contractors) constitutes protected concerted activity when it can benefit employees. [5] The NLRB also reaffirmed that:

• job applicants are statutory employees entitled to federal labor law protections, assuming that “there is no question that they genuinely seek employment,” [6] and
• an individual’s immigration status is “immaterial” to his or her status as a statutory employee in most circumstances. [7]

Takeaway for Employers

American Federation for Children cautions employers that concerted employee activity that seeks to support individuals outside of the employee relationship may nevertheless be sufficiently related to improving or protecting employees’ own employment terms, thus rendering it protected by the NLRA.

EMPLOYERS CANNOT RELY ON PAST PRACTICES TO MAKE OPERATIONAL CHANGES WHILE BARGAINING WITH UNIONS

Wendt Corporation [8]

The NLRB overruled Raytheon [9] and held that, regardless of past practices, newly unionized employers may not make unilateral changes to employment terms and conditions based on any employer practice of making such changes that were developed before employees unionized. [10] As a result, newly unionized employers will need to bargain with the union prior to making most employment and operational decisions and with the bargaining process requiring union consent to move forward or reaching an overall agreement or impasse on all bargaining issues except in very limited cases.

Takeaway for Employers

Employers involved with first contract negotiations will face greater difficulty making ordinary business decisions—such as adjusting staffing levels, revising hours and scheduling, and assigning new job duties or requirements—without offering the union notice and opportunity to bargain over the decisions. Even consistency in how the employer approaches these issues—linked to past practices, written policies, and objective factors—may still result in a failure to bargaining violation. At the same time, an employer may still be obligated to extend annual or recurring “positive” changes to employees, such as wage adjustments, given that the Wendt decision carved those out from its restrictive holding.

Additionally, given that labor law generally precludes “piecemeal” bargaining during negotiations, an employer may be effectively blocked from implementing the operational change unless the union agrees, or the employer has finished the entire bargaining process to impasse.

The shift in law will provide unions greater leverage during first contract negotiations and may incentivize employers to bargain faster in the hopes of reaching an agreement that will allow necessary operational changes to be lawfully implemented under a management rights clause.

Tecnocap [11]

The NLRB overruled another aspect of Raytheon in this case involving successor contract negotiations. Where an employer’s past practice of unilateral changes was developed under a management-rights clause in a collective-bargaining agreement, it cannot authorize unilateral changes made after the agreement expires and while bargaining for a new agreement continues. [12]

Similar to Wendt, the employer must provide notice and opportunity to bargain, and then obtain union consent to move forward or reach an overall agreement or impasse on all bargaining issues except in very limited cases.

Takeaway for Employers

Employers that have expired labor contracts should be aware that “business as usual” with making operational changes could result in a failure-to-bargain violation under this new ruling.

Any language in an expired collective bargaining agreement (CBA) that arguably is a “management right” provision, whether labeled as such or not, which authorizes management to make changes, is effectively defunct under the Tecnocap ruling—along with any practices that relate to management’s right to act consistent with past actions or changes under similar circumstances.

Tecnocap encourages employers to propose extra language in their management rights clauses to expressly state that any rights therein will continue in effect beyond CBA expiration to avoid bargaining violations.

[1] Miller Plastic Products Inc., 372 NLRB No. 134 (Aug. 25, 2023)

[2] 372 NLRB No. 134, slip op. at 7 (Aug. 25, 2023); cf. Alstate Maintenance, LLC, 367 NLRB No. 68 (Jan. 11, 2019) (using a factor-based analysis).

[3] American Federation for Children Inc., 372 NLRB No. 137 (Aug. 26, 2023)

[4] 368 NLRB No. 112 (Nov. 12 2019), rev. denied sub nom. Jarrar v. NLRB, 858 F. App’x 374 (D.C. Cir. 2021) (unpublished).

[5] 372 NLRB No. 137, slip op. at 9.

[6] 372 NLRB No. 137, slip op. at 6.

[7] 372 NLRB No. 137, slip op. at 6.

[8] Wendt Corporation, 372 NLRB No. 132 (Aug. 26, 2023)

[9] Raytheon Network Centric Systems, 365 NLRB No. 161 (2017).

[10] 372 NLRB No. 132, slip op. at 17.

[11] Tecnocap LLC, 372 NLRB No. 136 (Aug. 26, 2023)

[12] 372 NLRB No. 136, slip op. at 14.

[View source.]