The close of 2012 brought a flurry of activity by the National Labor Relations Board and the Board has not slowed down in the New Year.  Several of the Board’s recent decisions mark significant departures from decades of well-settled precedent and many others have ramifications for non-unionized employers.

Each individual decision does not have a direct impact on many of our clients, especially our non-unionized employers. Collectively, however, they represent a considerable change in the direction of the Board that is significant for both our unionized and non-unionized clients.  The Board has no intention of fading into the sunset, even as union membership continues to decline.

In Part 1 of a 2 part Alert series, we summarize the recent Board decisions in which the Board overturned long established precedent. In part 2, we address cases where the Board has acted in non-unionized settings.

1.) Employers Required to Disclose Witness Statements to the Union (Piedmont Gardens, overruling 34 year old precedent)

Since 1978, the Board has employed a bright-line rule holding that employers are not required to honor union requests for witness statements obtained during an employer’s investigation of employee misconduct.  In Piedmont Gardens, decided in December, the Board abandoned this bright line rule and will now apply a “balancing test”, weighing the union’s need for the requested statements against any legitimate and substantial confidentiality interests established by the employer.

For example, if the union asks for witness statements because it claims it needs to review them in order to determine whether to process a grievance, the employer would have to articulate a good reason why it does not want to turn over the statements.  The Board stated general concerns over witness intimidation will be insufficient.  Employers must have specific reasons for the refusal.  Even if the employer can establish legitimate and substantial confidentiality interests, it may have to propose some sort of accommodation, such as providing summaries of the witness statements without employee identification that may satisfy the union’s claimed need for the information.

Employers have good reasons to want to preserve the confidentiality of witnesses who participate in workplace investigations but employers can no longer count on the bright-line test. 

2.) Obligation to Continue Dues Check-off after Contract Expiration (WKYC-TV, Gannet Co., Inc., overruling 50 year old precedent)

In another complete departure from decades-old precedent, the Board expressly overruled 51 years of precedent and held that an employer’s obligation to continue to check off union dues continues after expiration of a collective bargaining agreement that establishes such an arrangement.

When a collective bargaining agreement expires, most provisions of the agreement that relate to “terms and conditions of employment” survive as the “status quo” and an employer cannot unilaterally change them without first bargaining to impasse with the union.  There are some terms of the agreement, however, that the Board has long held do not survive after the expiration of a collective bargaining agreement, among them no-strike clauses, arbitration provisions, and management rights clauses.  Since 1962 dues check-off provisions have been among the short list of terms that expire with the contract.  The initial reasoning behind this now overturned rule was that dues check-off provisions are often a complement to “union security” provisions (requiring employees to join the union) which expire with the contract.

In mid-December, the Board rejected this reasoning noting that some collective bargaining agreements provide for dues check-off even when there is no corresponding union security clause.  The bottom line is that employers who agree to check off union dues will have to continue to do so after contract expiration unless they bargain to impasse with the union over the decision to cease dues check-off.

3.) Duty to Bargain over Discretionary Discipline after Union Certification (Alan Ritchey, Inc., departing from 77 years of precedent)

Another significant change for employers is the Board’s recent decision that employers have a duty to bargain with a union before imposition of discipline, if there is not yet a collective bargaining agreement between the employer and a newly-certified union.  Although the Board had not previously directly addressed this issue, employers have been imposing discipline without bargaining over the discipline during this post election/ pre-certification window since the Board was created in 1935.

It is well-settled that the “status quo” governs after a union has been certified, but before the union and employer have agreed upon the terms of the first collective bargaining agreement.  That means that during this period the employer can continue to operate in the same manner it has in the past but cannot unilaterally make discretionary changes to that “status quo” without first bargaining to impasse with the union.

The Board’s decision in Alan Ritchey is a significant reinterpretation of what amounts to a departure from the “status quo.”  The employer in this case had operated for years under a progressive discipline system that gave it discretion, within guidelines, in determining appropriate discipline.  After its employees organized and certified a union as their representative, the employer continued to operate under this discipline system while negotiating the terms of a collective bargaining agreement.  The Board ruled that although the progressive discipline system in a broad sense was the “status quo” and could continue until the execution of the collective bargaining agreement, the employer could not impose discretionary discipline within the confines of that system without bargaining with the union.  If the discretionary discipline to be imposed is a suspension, demotion, discharge or another analogous sanction, the employer must bargain with the union over whether to impose that discipline before the discipline is imposed.  If the discipline is of a lesser sanction, the employer can bargain after the discipline.

Although this new rule is only relevant in the window of time between the certification of the union and the execution of the first collective bargaining agreement, it is significant because it operates to tie employers’ hands in the imposition of discipline – even when the discipline is taken pursuant to an established progressive discipline system.  The decision of whether and how to discipline an employee almost always involves at least some measure of discretion.

4.) “Gross-up” and New Administrative Requirements For Taxes on Back Pay  (Latino Express, overruling 28 year-old precedent)

On a more technical note – and hopefully not something most employers will have to deal with – the Board issued a decision holding that employers who violate the National Labor Relations Act and are ordered to pay back pay to employees must submit the appropriate documentation to the Social Security Administration so that back pay is allocated to appropriate calendar quarters rather than treated as a lump sum payment.  Further, employers must reimburse the employee for any additional Federal and State income taxes that are a consequence of receiving a lump-sum back pay award.  This decision applies to all pending cases and to all cases going forward and again directly overturns long standing prior Board decisions and practice.


These dramatic changes to the legal landscape are a reminder that the current Board is an active one.  We are monitoring these and other changes and will continue to update employers about the consequences of the Board’s decisions. 

Stay tuned for Part 2 of this Alert series in which we discuss the Board’s renewed emphasis on non-unionized employers.