Hunton Employment & Labor Perspectives

In Johnson Controls, Inc., 368 NLRB No. 20 (July 3, 2019),  the NLRB adopted a new framework for determining a union’s representative status once an employer has made a lawful anticipatory withdrawal of recognition based on disaffection evidence that the union has lost its majority status. Specifically, under Johnson Controls, a union seeking to demonstrate that it has reacquired majority status must do so in a secret ballot election conducted by the Board, rather than in an unfair labor practice proceeding.

In Johnson Controls, the employer had notified the union, a reasonable time before the expiration of the parties’ collective bargaining agreement, that it had received evidence that the union no longer had the support of a majority of the employees in the bargaining unit.  The employer therefore notified the union that at the termination of the agreement, it would withdraw recognition from the union. The union sought evidence to show it had reacquired majority support and filed an unfair labor practice charge claiming that the employer’s withdrawal of recognition constituted a refusal to bargain under Section 8(a)(5) of the NLRA.  The NLRB General Counsel issued a complaint.

An NLRB Administrative Law Judge dismissed the complaint, holding that the employer had evidence (in the form of a petition) that the union had lost majority support.  The ALJ rejected the union’s attempt to show that it had subsequently reacquired majority support through signed authorization cards. Such a showing would necessarily require that some of the signers of the petition had changed their minds and signed cards supporting the union. But the evidence failed to demonstrate that enough such “dual signers” existed to support the union’s claim of reacquiring majority support.

On appeal, the Board affirmed the ALJ, but in doing so, it partially overruled existing precedent under Levitz Furniture Co. of the Pacific, 333 NLRB 717, 725 (2001) Under Levitz, the question whether a union had reacquired majority status was determined by applying a “last in time” rule, which gave controlling effect to the later signature of a “dual signer” who signed both an anti-union petition and subsequently a union authorization card.

The Board observed there were “better ways to settle disputes over a union’s post-contract majority status than by relying on the ‘last in time’ rule” reasoning that the existing framework did not “properly safeguard employee free choice” or “promote labor relations stability.”  Notably, the Board found that under Levitz,  a dual signer’s  “disaffection signature is automatically invalidated by his … subsequent reauthorization signature… ignor[ing] the fact that dual signers have expressed both support and opposition to union representation within a short period of time” and “employees may not understand that signing a union card effectively revokes their prior signature.”

Further, because under the extant precedent, a union is not required to disclose to the employer it has reacquired majority status, unless and until unfair labor proceedings are initiated. This places the employer in an untenable position where, based on its evidence, it “will likely withdraw recognition at the contract expiration only to discover that it violated Section 8(a)(5),” causing an “unwarranted disruption to the bargaining relationship which could have been avoided had the employer known that its disaffection evidence had been superseded.”

The Board overruled this aspect of Levitz, and held that the question whether a union had reacquired a majority support would now be determined not in an unfair labor practice proceeding, but rather, in a secret ballot election conducted by the Board.  This new framework, the Board observed, is “fairer, promotes greater labor relations stability, and better pro­tects Section 7 rights by creating a new opportunity to determine employees’ wishes concerning representation through the preferred means of a secret ballot, Board-conducted election.” If a union wishes to establish that it has reacquired majority status, then it must file its petition for an election to do so within 45 days of the employer’s announcement of its intent to withdraw recognition.

The other change made to the Levitz framework in Johnson Controls was to define what constituted a “reasonable time” before the termination of a collective bargaining agreement, for the purposes of allowing an employer to give anticipatory notice of withdrawal of recognition.  The Board replaced the reasonable time standard with a bright line standard of not more than 90 days prior to the expiration of the agreement.

The Board will apply the new framework to all pending cases.

There are other issues which may impact an employer’s withdrawal of recognition under Johnson Controls, including risk in the timing and nature of any unilateral changes made in employees’ terms and conditions of employment, and the potential for the filing of rival union or employee election petitions and their impact on whether the employer may take advantage of a safe harbor if it withdraws recognition.  For these and other reasons, and employer contemplating such a withdrawal should consult with labor relations counsel to explore all aspects of the situation before taking any action.