Recently,
the U.S. Court of Appeals in Chicago enforced a decision by the National Labor
Relations Board (NLRB) which had found AutoNation, Inc. unlawfully laid off some
of its unionized technicians in Florida.
What made the company’s actions unlawful (besides the fact that the
employees had recently joined a union) was that the layoffs were done without
first bargaining with the employees’ union. The company claimed that dire
economic circumstances during the Great Recession, made the layoffs inevitable
and, thus, negotiating with the union would have been a waste of time. The NLRB disagreed, finding that AutoNation
was required to negotiate with the International Association of Machinists
(IAM) before it could lay off any employees. Because the layoffs were found to
be unlawful and the court has now enforced the Board’s findings, the next step
will be for the NLRB to fashion a standard “make whole” remedy for the laid off
workers. Ultimately, back pay for the employees may be huge since the case is
many years old due to the fact that prior rulings of the NLRB were invalidated
as a result of the Supreme Court’s ruling in Noel Canning, which found that
President Obama’s interim appointments were unlawful.
This
case serves as a reminder to employers with unions: negotiating a contract, or “collective
bargaining agreement” (CBA) may not be the only occasion where union negotiations
are mandated by federal labor law. This may be so even where management has
reserved decision-making authority in a CBA (e.g. a well written management’s
rights clause providing that management has discretion to decide layoffs, etc.). Depending on the circumstances, there still
may be an obligation to negotiate “effects” of some decisions if not the
decisions themselves. The stakes can be
quite high. Failing to negotiate with a
union where required by law, can result in an employer being ordered to pay
back pay or in some instances, to reopen a closed facility.
For
guidance on issues of “effects bargaining,” “decision bargaining,” and other
union negotiation issues, contact Attorney James Sherman at (952) 746-1700 or
email jasherman@wesselssherman.com.
