HR Legalist

NLRB Makes it Harder for Employers to Make Changes without First Negotiating with the Union

In December, the National Labor Relations Board (“NLRB” or “Board”) announced a return to a stricter standard to determine whether employers can lawfully make unilateral changes to working terms and conditions without bargaining with the union.  On December 10, 2024, in Endurance Environmental Solutions, LLC, 373 NLRB No. 141 (2024), the Board reversed MV Transportation, Inc., 368 NLRB No. 66 (2019), which held that employers have license to make unilateral changes to working conditions if the subject matter of the change came within the “compass or scope” of the parties’ collective bargaining agreement, or the so-called “contract coverage” test. Now, employers must show that the union “contractually surrendered” the right to bargain through a “clear and unmistakable” waiver, which is a return to the standard applied by the Board pre-2019.

In Endurance Environmental, the employer attempted to unilaterally install cameras that monitored employees in their trucks without bargaining with the union and in response, the union filed an 368 NLRB No. 66 (2019), charge. The employer argued that its actions were covered by the management rights language in its collective bargaining agreement, which specifically permitted it to “implement changes in equipment” without the union’s consent. The administrative law judge (“ALJ”) applied the “contract coverage” test and dismissed the charge. However, on appeal the Board reversed the ALJ and announced the returned to the “clear and unmistakable” waiver standard. Under this standard, employers must show that the union “unequivocally and specifically express[ed] their mutual intention to permit unilateral employer action with respect to a particular employment term.”

Going forward, employers should make sure that their collective bargaining agreements are well documented and have clear and explicit management rights clauses to avoid any potential conflicts. If a contract does not specifically cover an employer’s action, the Board will apply the “clear and unmistakable” waiver test to determine whether some combination of contract language, bargaining history, and past practice, establishes that the union waived the right to bargain over a change. This will undoubtedly be an uphill battle for employers.

Of course, this shift in policy is likely to be short-lived.  President Donald Trump is expected to appoint two Republicans to the Board.  It is unclear exactly when the Board will return to a Republican-controlled majority, but when it does, the new majority will likely once again seek opportunities to revert to the more employer-friendly rulings, including a return to the “contract coverage” standard. 

In the meantime, employers should be sure to negotiate detailed and comprehensive management rights clauses during bargaining to avoid future conflicts and maintain the ability to make unilateral changes. A review of existing collective bargaining agreements may be necessary to determine where there are weaknesses. Employers in need of specific guidance should contact an Obermayer attorney.

The information contained in this publication should not be construed as legal advice, is not a substitute for legal counsel, and should not be relied on as such. For legal advice or answers to specific questions, please contact one of our attorneys.