Hunton Employment & Labor Perspectives

In a recent decision of first impression, the NLRB held that its contract coverage doctrine does not apply to changes to the terms and conditions of employment after the expiration of the parties’ collective bargaining agreement, unless the contract contained explicit language that the relevant provision would survive contract expiration.  Nexstar Broadcasting, Inc. d/b/a KOIN-TV, 369 NLRB No. 61 (2020).

The contract coverage doctrine was adopted by the NLRB in MV Transportation, Inc., 368 NLRB No. 66 (2019). There, the Board held that it would “examine the plain language of the collective bargaining agreement to determine whether action taken by an employer was within the compass or scope of contractual language granting the employer the right to act unilaterally.”  Id.  The contract coverage doctrine dispenses with the requirement that an employer demonstrate that the union clearly and unmistakably waived its right to bargain over changes made based on contractual language.

When a collective-bargaining agreement terminates, it is no longer enforceable as a contract (except where there are still unfulfilled rights and obligations under certain provisions, e.g., unpaid wages).  Under the NLRA, however, the employer is required to maintain the status quo with respect to all mandatory terms and conditions of employment, until the parties reach a new collective bargaining agreement or a legitimate impasse is reached.

In Nexstar, the NLRB grappled with whether the contract coverage doctrine set forth in MV Transportation should also apply to surviving terms and conditions of employment following the termination of a collective bargaining agreement.  The NLRB held that generally it did not.  Specifically, the Board held:  “[P]rovisions in an expired collective-bargaining agreement do not cover post-expiration unilateral changes, unless the agreement contained language explicitly providing that the relevant provision would survive contract expiration.” Id.

This holding seems consistent with the notion that the surviving terms and conditions of employment are not a contract mutually agreed by the parties.  As the Board put it: “After a contract expires, ‘terms and conditions continue in effect by operation of law.  They are no longer agreed-upon terms; they are terms imposed by law.” Id., citing and quoting Litton Financial Printing Division v. NLRB, 501 U.S. 190 (1991).  As such, they are subject to collective bargaining before they can be changed or put into a new collective bargaining agreement.  Extending the right of employer unilateral action into this post-contract period, absent the explicit mutual agreement to do so, would be contrary to the duty to bargain during this time.

The takeaway from the Nexstar decision would appear to be this:  Where there are provisions in a collective bargaining agreement that protect employer unilateral action under the contract coverage clause, and preserving those unilateral rights is key to running the business, then including explicit language that such unilateral action provisions survive the expiration of the agreement may be an important bargaining goal. If that is the case, then it will be important for employers to stay on top of developments in this area as cases come before the NLRB General Counsel and Board.