The National Labor Relations Board continues to overrule Obama-Board precedent at a rapid pace.  (See our prior blog posts here, here and here for a few recent examples.)

On June 23, 2020, in 800 River Road Operating Company, LLC d/b/a Care One at New Milford, 369 NLRB No. 109, the Board overturned  Total Security Management Illinois 1, LLC, 364 NLRB No. 106 (2016), which had required employers to provide notice and an opportunity to bargain to a newly-certified union on “serious” disciplinary action against unit employees, even before a collective bargaining agreement is in place.  In doing so, the Board returned to a rule established 80 years ago that had permitted employers to discipline employees without first notifying or bargaining with a newly-certified union, provided that the action taken was consistent with established policy or practice preexisting the certification.

The ALJ’s Application of Total Security      

In 800 River Road, the union was certified by the NLRB as the representative of certain employees at the employer’s facility in 2012.  The employer challenged the certification, which was ultimately upheld by the D.C. Circuit in 2017.  Prior to the execution of an initial CBA with the union, the employer suspended three employees and discharged another pursuant to its then-existing disciplinary policy, without notice to the union.  During contract negotiations months later, the employer informed the union of the discipline.  An unfair labor practice charge was filed alleging that the employer had violated its duty to bargain over the discipline of the four employees.

Applying Total Security, an administrative law judge of the NLRB held that the employer’s actions satisfied the definition of “serious discipline,” and that the failure to provide the union with notice and an opportunity to bargain violated the NLRA.

800 River Road Overturns Total Security

In a unanimous opinion, the Board overturned Total Security, holding that the employer was permitted, without bargaining, to discipline the employees pursuant to its existing disciplinary policy.  The Board’s rationale for overturning Total Security was three-fold:

  • First, Total Security conflicted with 80-years of precedent, which had not required employers to notify or bargain with a newly-certified union concerning the exercise of discretionary discipline imposed pursuant to an existing policy.
  • Second, the Total Security-Board had misinterpreted the Supreme Court’s application of the unilateral-change doctrine enunciated by the Supreme Court in NLRB v. Katz, emphasizing that not every action involving the exercise of employer discretion that results in a change of terms and conditions of employment requires notice to the union and an opportunity to bargain.
  • Third, Total Security imposed confusing and burdensome obligations at odds with general principles of good faith bargaining, as it did not require the parties to negotiate either to agreement or impasse before permitting the employer to impose discipline, leaving it unclear when action could be lawfully taken. Moreover, requiring employers to bargain in advance over serious discipline interfered with their legitimate business needs by causing undue delay.

The ruling in 800 River Road applies retroactively.

Takeaways

This decision is a clear “win” for employers, as the Board relieved management of an onerous and confusing bargaining obligation.  In practice, it had been challenging to say the least for employers to distinguish “serious” discipline from garden–variety action not requiring notice and bargaining.

In addition, Total Security established no bright line as to when the bargaining obligation had been fully discharged, allowing the employer to proceed.  This left employers in a quandary.

800 River Road frees employers engaged in first contract bargaining to act swiftly in addressing serious disciplinary issues, without union involvement, provided that the employer follows its existing practice and procedure in doing so.

Photo of Peter D. Conrad Peter D. Conrad

Peter D. Conrad began his legal career as a trial attorney and hearing officer at the National Labor Relations Board.

He has represented employers in numerous industries (including health care, higher education, financial services, trucking, pharmaceutical, petrochemical, telecommunications, legal services, publishing, retail, broadcasting…

Peter D. Conrad began his legal career as a trial attorney and hearing officer at the National Labor Relations Board.

He has represented employers in numerous industries (including health care, higher education, financial services, trucking, pharmaceutical, petrochemical, telecommunications, legal services, publishing, retail, broadcasting, entertainment, hotel and professional sports) in the full range of unfair labor practice and election proceedings before the NLRB. In the nearly 30 years that Peter has handled matters at the NLRB, he has confronted virtually every issue that a labor lawyer practicing in this area could expect to see, from the straightforward discharge for union activity, to the most complex secondary boycott, successorship and refusal-to-bargain situations, representing some of the firm’s most prestigious clients.

The remainder of Peter’s time was devoted to the related areas of union avoidance and corporate campaigns (defending employers against organizational activity in its many forms), as well as arbitration, negotiation, and litigation under collective bargaining agreements. Although primarily engaged in a more traditional labor relations practice, Peter also represents companies in employment discrimination cases (before state and federal administrative agencies and in the courts), workers’ compensation and unemployment insurance proceedings, and general client counseling in all areas of labor relations and employment law.

The clients that Peter represented on a regular basis include T-Mobile USA, United Parcel Service, Consolidated Edison Company of New York, Barneys New York, Delaware North Companies, Castle Oil Corporation, and Otis Elevator Company, to name a few.

As a member of the interdepartmental Sports Law Group, Peter also has done work over the years for the National Basketball Association, the National Hockey League, Major League Baseball and the Major Indoor Soccer League, primarily in matters pending at the NLRB, including the 1995 attempted decertification of the National Basketball Players’ Association and the much more recent season-long lockout by the NHL in 2004/2005.

Peter has been a member of the faculty of the Practising Law Institute since 1987, speaking on the labor and employment law aspects of “Acquiring or Selling the Privately Held Company.”

Photo of Joshua Fox Joshua Fox

Joshua S. Fox is a senior counsel in the Labor & Employment Law Department and a member of the Sports, Labor-Management Relations, Class and Collective Actions and Wage and Hour Groups.

As a member of the Sports Law Group, Josh has represented several…

Joshua S. Fox is a senior counsel in the Labor & Employment Law Department and a member of the Sports, Labor-Management Relations, Class and Collective Actions and Wage and Hour Groups.

As a member of the Sports Law Group, Josh has represented several Major League Baseball Clubs in all aspects of the salary arbitration process, including the Miami Marlins, Boston Red Sox, Los Angeles Dodgers, Kansas City Royals, San Francisco Giants, Tampa Bay Rays and Toronto Blue Jays. In particular, Josh successfully represented the Miami Marlins in their case against All-Star Catcher J.T. Realmuto, which was a significant club victory in salary arbitration. Josh also represents Major League Baseball and its clubs in ongoing litigation brought by current and former minor league players who allege minimum wage and overtime violations. Josh participated on the team that successfully defended Major League Baseball in a wage-and-hour lawsuit brought by a former volunteer for the 2013 All-Star FanFest, who alleged minimum wage violations under federal and state law. The lawsuit was dismissed by the federal district court, and was affirmed by the U.S. Court of Appeals for the Second Circuit.

Josh also has extensive experience representing professional sports leagues and teams in grievance arbitration proceedings, including playing a vital role in all aspects of the grievance challenging the suspension for use of performance-enhancing drugs of then-New York Yankees third baseman Alex Rodriguez. Josh also has counseled NHL Clubs and served on the trial teams for grievances alleging violations of the collective bargaining agreement, including cases involving use of performance-enhancing substances, domestic violence issues, and supplementary discipline for on-ice conduct. He has played a key role in representing professional sports leagues in all aspects of their collective bargaining negotiations with players and officials, including the Major League Baseball, National Hockey League, the National Football League, Major League Soccer, the Professional Referee Organization, and the National Basketball Association,.

In addition, Josh has extensive experience representing clients in the performing arts industry, including the New York City Ballet, New York City Opera, Big Apple Circus, among many others, in collective bargaining negotiations with performers and musicians, the administration of their collective bargaining agreements, and in grievance arbitrations.

Josh also represents a diverse range of clients, including real estate developers and contractors, pipe line contractors, hospitals, hotels, manufacturers and public employers, in collective bargaining, counseling on general employment matters and proceedings before the National Labor Relations Board, New York State Public Employment Relations Board and arbitrators.

Josh has also recently served as an adjunct professor at Cornell University’s School of Industrial Labor Relations for the past two years, teaching a course regarding Major League Baseball salary arbitration.

Prior to joining Proskauer, Josh worked for a year and a half at the National Hockey League, where he was involved in all labor and employment matters, including preparations for collective bargaining, grievance arbitration, contract drafting and reviewing and employment counseling. Josh also interned in the labor relations department of Major League Baseball and at Region 2 of the National Labor Relations Board. He was a member of the Brooklyn Law Review and the Appellate Moot Court Honor Society and served as president of the Brooklyn Entertainment and Sports Law Society.