Hunton Employment & Labor Perspectives

In one of the largest back pay awards in the agency's history, the National Labor Relations Board (NLRB) concluded a settlement with five Michigan beer distributors that required the companies to pay $41 million in back pay to employees and the Teamsters. Findings from an ALJ, supported by the NLRB and the 6th Circuit Court of Appeals, concluded that the five companies colluded to systematically oust the union by separately engaging in bad faith bargaining, unlawfully declaring impasse, and then implementing their respective labor contracts with substantially lower wages and benefits.

A settlement of this magnitude in a case that did not involve strike misconduct, plant closure, or wholesale discharges reflects the Board's clear intent to put real teeth into its enforcement process, particularly with regard to the obligation to bargain for contracts in good faith.  This settlement may be raised by opponents of the Employee Free Choice Act as evidence that the Board already has sufficient ability under existing law (the National Labor Relations Act) to aggressively enforce collective bargaining obligations, which obviates any need for remedies such as mandatory arbitration.