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Employers Can Discipline Workers Before Bargaining: NLRB (2)

June 23, 2020, 8:11 PMUpdated: June 23, 2020, 9:28 PM

The National Labor Relations Board has overturned agency precedent in a decision that allows employers to impose serious discipline on an employee ahead of reaching a collective bargaining agreement with a newly formed union.

The pre-discipline bargaining obligation conflicts with U.S. Supreme Court interpretations of labor law and “imposed a complicated and burdensome bargaining scheme that was irreconcilable with the general body of law governing” bargaining practices, the NLRB said in a statement Tuesday.

The decision means that management at newly unionized businesses can carry out discipline during the pre-contract phase without having to notify or bargain with the union. Employers weren’t required to reach an agreement with the union before actually taking action under the previous precedent, and could impose discipline unilaterally in certain exigent circumstances.

The board’s decision reinstates a policy “that employers have no statutory obligation to bargain before imposing discretionary discipline that is materially consistent with the employer’s established policy or practice,” the members said.

A Democratic-majority NLRB put in place the previous policy in 2012, but that ruling was overturned after the U.S. Supreme Court held that the appointment of several board members had been constitutionally improper. Another Democratic majority revived the policy in a 3-1 decision in 2016, before the board’s reversal Tuesday.

Some management-side attorneys predicted that a Republican-led NLRB—the board now has three GOP members and two empty seats—would overturn the policy, arguing that the previous Democratic majorities went too far in a pro-union direction and disturbed the balance between employees’ and employers’ interests.

Applies to Pending Cases

The NLRB said the new ruling will apply retroactively to all pending cases.

The Democratic board that put in place the previous policy didn’t apply that ruling retroactively because doing so would have imposed foreseeable difficulties on employers, the board said at the time.

The agency basically determines that issue by balancing the potential negative effects of applying a precedent retroactively, versus those implicated by not doing so, the current NLRB members said.

The board said it doesn’t believe any ill effects will result from retroactivity in this case, and that no party that has relied on the previous precedent will be found to have violated labor laws based on its Tuesday ruling.

Parties “may have engaged in bargaining that our decision today renders unnecessary, but such bargaining is merely rendered superfluous by our decision, not unlawful.”

(Updated with additional reporting. An earlier version corrected the number of board vacancies. )

To contact the reporter on this story: Hassan A. Kanu in Washington at hkanu@bloomberglaw.com

To contact the editors responsible for this story: Martha Mueller Neff at mmuellerneff@bloomberglaw.com; Karl Hardy at khardy@bloomberglaw.com

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