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NLRB Restores Precedent on What Triggers Bargaining Obligations with Unions

Signaling another departure from decisions made during the era of former President Barack Obama, the National Labor Relations Board (NLRB) last week restored the ability of unionized employers to implement unilateral changes to employment conditions where there is a clear past practice—the so-called "dynamic status quo doctrine." The Board's ruling increases the discretion of unionized employers in making business decisions.

In Raytheon Company, the board, in a 3-2 decision, held that employers' actions do not constitute a "unilateral change" triggering bargaining obligations if those actions are in line with an established history of similar actions. This decision provides unionized employers with much-needed latitude, particularly regarding the often-contentious issue of health care benefits.

This decision overrules a 2016 Obama-era NLRB case, E.I. du Pont de Nemours, in which a sharply divided Board held that actions consistent with an established practice nevertheless trigger bargaining obligations—and a duty to make no changes pending bargaining—if the past practice was created under a management-rights clause of an expired collective bargaining agreement or involved an exercise of the employer's discretion.

In the strongly worded opinion, the Board in Raytheon rejected the ruling in DuPont, declaring that "the decision improperly departed from fundamental principles governing past practice and the duty to bargain" and ignored the need for "certainty and predictability."

In Raytheon, the Board noted that the changes at issue, involving the company-wide medical plan that covered union and non-union employees alike, had been occurring annually over the last decade and that each year saw increases to premiums and fluctuations in available benefits, medical options, deductibles and co-payments—all changes "one regularly sees from year to year in cafeteria-style benefits plans."

The Board ruled that the disputed changes to health care benefits were consistent with the employer's established practice and did not trigger a duty to bargain simply because some employer discretion was involved. The Board also stressed that the management's duty to bargain with the union on all mandatory matters remained intact, regardless whether a past practice/dynamic status quo was involved.

Copyright © by Ballard Spahr LLP

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Steve Suflas, Ballard Spahr Law Firm, Denver, Labor and Employment Litigation Attorney
Partner

Steven W. Suflas is Managing Partner of the Denver and Boulder offices and a nationally recognized thought leader on labor and employment issues. He represents management in all phases of labor and employment matters — from preventative counseling and strategic guidance to collective bargaining, appearances before regulatory agencies, and litigation before courts and administrative agencies. He works closely with employers — both large and small, national, regional, and local — in responding to the daily challenges of the workplace.

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attorney

Elizabeth McManus advises public and private employers on a wide range of labor and employment matters including employment discrimination, wage and hour issues, harassment, employee benefits plans, layoffs, unfair labor practice proceedings, and reductions in force. She has experience assisting clients with drafting employment agreements and workplace policies and counseling on Fair Labor Standards Act (FLSA) and Family Medical Leave Act (FMLA) compliance. She also has experience drafting arbitration, trial court, and appellate briefs on issues relating to discrimination allegations, ERISA liability, mandatory arbitration, and public and private employer bargaining obligations in both state and federal courts and before administrative agencies.

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Anu Thomas, Ballard Spahr Law Firm, Philadelphia, Labor and Employment Litigation Attorney
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Anu Susan Thomas is an associate in the Litigation Department and a member of the firm’s Labor and Employment Group. While in law school, Ms. Thomas was a summer associate at Ballard Spahr, and a Philadelphia Diversity Law Group summer associate in the Office of University Counsel at Temple University, where she conducted legal research and drafted documents that addressed employee, faculty, and general university issues. She also served as an education and community outreach field officer and project manager at the Profugo Organization in South India, where she...

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