NLRB Reinstates Decades-Long Precedent Allowing Employers to Discipline Newly Organized Employees Before a First Contract

Seyfarth Synopsis: On June 23, 2020, the National Labor Relations Board reversed precedent and held in Care One at New Milford, 369 NLRB No. 109 (2020), that during negotiations for a first collective bargaining agreement, employers do not have a duty to bargain with a union over discipline for newly organized employees if the discipline is issued consistent with established disciplinary policies or practices. The decision is retroactive to any case currently pending before the NLRB.

For almost 80 years, the National Labor Relations Board had in place a longstanding rule that employers had no obligation to give a union notice of or an opportunity to bargain over discipline before reaching agreement with a newly elected union on a first contract. That all changed, however, when the NLRB held in Total Security Management Illinois 1, LLC, 362 NLRB No. 106 (2016), that an employer, with limited exceptions, was required to provide a union with notice and an opportunity to bargain about discretionary elements of an existing disciplinary policy before imposing serious discipline on any newly represented employees while bargaining for a first contract. Notably, the NLRB had reached a similar conclusion in Alan Ritchey, Inc., 359 NLRB 396 (2012). That decision, however, was invalidated by the U.S. Supreme Court’s holding in NLRB v. Noel Canning, 134 S.Ct. 2550 (2014), because the Board’s composition at the time of Alan Ritchey included two individuals whose appointments violated the United States Constitution.

As is often the case with the NLRB, the pendulum has swung back, with the current NLRB blasting the Total Security decision for going to great lengths to “devise a contorted bargaining scheme at odds with traditional bargaining practices” and having “shredded longstanding principles governing the duty to bargain.” On June 23, 2020, the NLRB overturned Total Security and held in Care One at New Milford, 369 NLRB No. 109 (2020), that employers have no duty to bargain over serious employee discipline imposed before the negotiation of a collective bargaining agreement so long as the employer acts consistent with a pre-existing disciplinary policy.

According to the Board, Total Security had conflicted with prior Board precedent and the Supreme Court’s statements in NLRB v. Weingarten, 420 U.S. 251 (1975), that a labor organization does not have “any particular rights with respect to pre-disciplinary discussion which it otherwise was not able to secure during collective-bargaining negotiations.” Second, the Board found that Total Security misconstrued the general unilateral-change doctrine announced in the Supreme Court’s decision in NLRB v. Katz, 369 U.S. 736 (1962), with respect to what constitutes a material change in working conditions. Finally, the Care One NLRB concluded that Total Security had imposed a complicated and burdensome bargaining scheme that was irreconcilable with the general body of law governing statutory bargaining practices. According to the Board in Care One:

[T]he correct analysis … must focus on whether an employer’s individual disciplinary action is similar in kind and degree to what the employer did in the past within the structure of established policy or practice …. As such, in order to maintain the status quo, an employer must continue to make decisions materially consistent with its established policy or practice, including its use of discretion, after the certification or recognition of a union.

Negotiating with a labor organization for a first contract can be stressful and time-consuming, which makes the Board’s decision a welcome sigh of relief for employers. In fact, it applies retroactively to any case currently pending before the NLRB. That said, employers with new collective bargaining relationships with labor organizations still must be mindful of the obligation to ensure that any pre-contract discipline is imposed in accordance with their existing disciplinary policies or practices.