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NLRB Relaxes Standard for Employer Changes to Employees’ Terms and Conditions of Employment

September 13, 2019

This week, the National Labor Relations Board (the Board) made it easier for employers to change the terms and conditions of their workers’ employment without union permission. 

Previously, the Board had held that the relevant collective bargaining agreement had to give the employer “clear and unmistakable” permission to unilaterally change a term or condition of employment. Provena St. Joseph Medical Center, 350 NLRB 808 (2007). Under Provena St. Joseph, absent “clear and unmistakable” permission, employers were required to bargain with the union before changing any bargained-for terms or conditions of employment.

In the MV Transportation ruling published on September 10, 2019 the Board voted 3-1 to adopt the “contract coverage” standard that has been followed by the D.C., First and Seventh Circuits. 368 NLRB No. 66 (2019) . Under this new standard, an employer may unilaterally change a term or condition of employment if the collective bargaining agreement can be said to “cover” the change in dispute. To determine this, “the Board will examine the plain language of the collective bargaining agreement to determine whether action taken by an employer was within the compass or scope of contractual language granting the employer the right to act unilaterally.” Id, at 2. For example, if the collective bargaining agreement contains a provision that broadly grants the employer the ability to implement new rules and policies and revise existing ones, the employer may implement a new attendance or safety rule without first bargaining with the union.

In MV Transportation, the employer, a Las Vegas transit company, attempted to revise five different work policies in a union contract. The union agreed to some of the changes but rejected others, after which the employer unilaterally implemented all of the revised policies. As is the case with most collective bargaining agreements, this one contained language giving the employer the general right to “manage its business.” Explaining further, this collective bargaining agreement stated that “[a]mong these rights, and by no means a wholly inclusive list, is the right to determine staffing size, to decide and assign all schedules, work hours, work shifts…and to adopt and enforce reasonable work rules.” MV Transportation, at 15. Under the clear and unmistakable standard, this language would not have been specific enough to demonstrate that the union had waived its right to bargain over the changes. However, under the contract coverage standard, the Board found that the employer’s changes were within the scope of the bargained-for language in the collective bargaining agreement.

Employers should examine the language in their collective bargaining agreements, or consult with legal counsel, on a case-by-case basis to determine whether they will fall under the contract coverage standard and therefore have the flexibility to unilaterally revise or implement certain rules and policies.

For questions regarding the contract coverage standard or the application of the National Labor Relations Act to your workplace, contact any member of Varnum’s Labor and Employment Team.

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