NLRB Keeps Contract Bar Rule—For Now

Sherman & Howard L.L.C.

Sherman & Howard L.L.C.

Over the past year, the viability of the “Contract Bar” rule has been far from certain. After considering whether to (1) rescind the doctrine, (2) retain it in its current form, or (3) modify it, the National Labor Relations Board (the “Board”) unexpectedly decided to retain the Contract Bar rule in its current form.

The Contract Bar rule prohibits union decertification or any other petition challenging a union’s representative status while a Collective Bargaining Agreement (“CBA”) is in effect. This bar, however, is limited to three years in duration. The rule usually has the effect of limiting the filing of decertification and other petitions to a narrow window of time towards the end of the CBA’s duration. While the Board previously indicated its willingness to reconsider the Contract Bar rule, in Mountaire Farms, N.L.R.B., Case 05-RD-256888, Decision 4/21/21, the Board ultimately decided to retain the Contract Bar.

Mountaire Farms concerned the Regional Director’s refusal to apply the Contract Bar to a decertification because he determined the CBA contained an unlawful union security clause. The Union requested review and the Board invited public briefing on the issue of whether the Contract Bar rule should be rescinded, retained, or modified. While the decision was pending Board review, a mail-in ballot election was held, and the ballots were impounded—their fate to be determined by the Board’s ruling.

After considering the briefs submitted by the parties and other stakeholders, the Board concluded “a sufficiently compelling case has not been made for any particular proposed modification” to the Contract Bar rule. On appeal, the Board found the union security clause lawful and applied the Contract Bar to prohibit the decertification election, ordering the impounded decertification votes destroyed. While the Board determined this particular case would not result in a modification or elimination of the Contract Bar rule, the Board indicated it found persuasive arguments that the Contract Bar window is confusing, and employees are unable to determine when the period opens and closes.

Given the impending change in the make-up of the Board, it is unlikely that the Contract Bar will be at risk during the Biden Administration. Employers who had hoped this impediment to elections would be removed are likely out of luck as a more labor-friendly NLRB will be sure to preserve the Contract Bar.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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