April 1, 2020 - Coronavirus (COVID-19), NLRB

Avoiding Labor Violations When Responding to the COVID-19 Pandemic

With the onslaught of various state and local shelter-in-place orders, new health and safety guidelines for workplaces, and the ensuing economic downturn, many companies need to act quickly to address the unprecedented challenges due to the COVID-19 pandemic. When responding to these challenges, both unionized or non-union employers should be careful not to run afoul of the National Labor Relations Act (“NLRA” or the “Act”). Below, we provide some practical guidance for employers on how to avoid labor law violations when confronting these issues in their workplace.

PROTECTED CONCERTED ACTIVITY

Section 7 of the NLRA generally applies to all U.S. employers, whether they are unionized or not. Section 7 of the Act guarantees employees (except for management and supervisors), even if they are not part of a union, “the right to … engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection.”

An employee’s right to engage in protected concerted activity under Section 7 has been interpreted broadly. One clear example of concerted activity is when two or more employees complain to their employer about workplace health and safety conditions. An individual who brings a complaint on behalf of a group of employees to the attention of management or seeks to initiate, induce, or prepare his or her coworkers to engage in group action may also be engaging in concerted activity under the Act. Disciplining or discharging the employee for engaging in concerted activity constitutes an unfair labor practice (“ULP”), for which the National Labor Relations Board (“NLRB”) could seek make-whole remedies, including reinstatement and backpay.  

Can an Employee Refuse to Work for COVID-19 Concerns?

Employers need to be cautious when responding to employees refusing to work due to safety concerns. If an employee raises concerns, even if he or she is mistaken about the risk, the employee may be engaging in protected activity under the NLRA. Employers should assess those concerns carefully before taking any adverse action.  

Can an Employee Be Asked to Remove a Negative Post on Social Media About His or Her Employer’s Response to COVID-19? 

Employees can engage in protected concerted activity on social media. If an employee posts comments on social media that could reasonably be viewed as trying to encourage other employees to band together to protest workplace issues, such as workplace safety or an employer’s decision to cut employee wages or furlough employees, it could qualify as protected activity.

COLLECTIVE BARGAINING

Employers who have employees represented by a union are generally prohibited from making unilateral changes to the terms and conditions of employment for those employees without first bargaining with their union. Employers are required to bargain with the union over mandatory subjects of bargaining that “vitally affect” the represented employees’ wages, hours, and working conditions, such as changes to employees’ jobs (e.g., work assignments, pay, schedules, etc.), changes to workplace health and safety standards, and layoffs or furloughs of represented employees. Making unilateral changes without first providing the union notice and a meaningful opportunity to bargain can result in ULP charges or orders requiring the employer to bargain with the union before proceeding with the change.

Given the numerous state shelter-in-place orders, as well as the health, safety, and economic challenges employers are facing from the growing COVID-19 pandemic, many employers need to act swiftly to make changes to their workforce. Some employers may not be able to undertake traditional bargaining with union representatives, particularly if their businesses are being forced to close as nonessential services under shelter-in-place orders. Although employers, in many instances, will still need to adhere to their obligations under their collective bargaining agreements (“CBAs”) and the NLRA, they may have some flexibility when implementing certain changes.

Is Bargaining Required? 

An employer that needs to make changes to wages, hours, or other terms and conditions of employment that are mandatory subjects of bargaining should first review their applicable CBA and memorandums of understanding with the union to determine if those subjects are already covered or if it has discretion to act. A CBA may already address how to handle certain situations or include a protocol for making those changes. For example, if the employer is contemplating layoffs, the CBA may already provide a protocol for layoffs that would work for the employer’s current circumstances. 

If the CBA does not address the needed action or the company needs to change the CBA protocol in order to respond to the current COVID-19 situation, employers should consider options that might allow them to take unilateral action. These options can include:

  • Checking the management rights clause in their CBA to see if they have the right to unilaterally make the contemplated change;
  • Determining whether their CBA has a force majeure clause that would cover the COVID-19 pandemic; or
  • Considering whether there is an applicable exception to bargaining given the exigencies of the current situation.

As a practical matter, even when an employer does not have to bargain, it may want to notify the union in advance of implementing the change to preempt any dispute and determine whether the parties can reach a mutually acceptable agreement. An employer may also have a good relationship with its union, and the union may be willing to provide concessions, particularly in these circumstances where the employer may need to make changes to avoid potential furloughs, layoffs, or shutdowns in the near term. Employers should consider the impact of making unilateral changes on their ongoing relationship with their unions and employees, which may prove critical if the employer needs to ramp up again quickly.

Does a Management Rights Provision in a CBA Relieve an Employer from Bargaining?

Many CBAs contain a management rights clause that reserves the employer’s right to decide certain workplace issues during the term of a CBA. Some management rights clauses will expressly allow employers to take unilateral action to determine various issues for the workforce, such as schedules, work rules, staffing size, and other critical issues.

The Board recently adopted the more lenient “contract coverage” standard to determine whether the management rights clause in a CBA allows employers to act unilaterally.[1] Under the “contract coverage” standard, the Board reviews the plain language in the CBA to determine whether the change is permissible. If the unilateral actions are “within the compass or scope” of the CBA, the change will not violate the NLRA. However, if the unilateral action is not “within the compass or scope” of the CBA, the employer will violate the NLRA unless it can show that the union “clearly and unmistakably waived its right to bargain” the change or that unilateral action was privileged for some reason.

Applying that standard to current COVID-19 context, a broad management rights’ provision in the CBA that grants the employer the right to implement new rules and policies and to revise existing ones could allow the employer to unilaterally implement new attendance or safety rules without violating the Act. Some management rights provisions also allow employers to layoff employees without bargaining.

Will the Force Majeure Clause in the CBA Allow Unilateral Changes?

A force majeure clause is a contractual provision that excuses a party’s performance of its obligations under the contract if performance because impossible or impracticable. For example, following the September 11, 2001 attacks, Northwest Airlines Corp. invoked the force majeure clause in its CBAs to layoff a substantial number of its employees, in response to which one of the unions filed a grievance.[2]

Many CBAs do not have a force majeure clause. Even if the applicable CBA contains such a clause, whether the current COVID-19 situation triggers the force majeure clause will vary by employer, depending on the exact language of the contract provision and the effect that the COVID-19 situation is having on the business.

Is There an Exception to an Employer’s Bargaining Obligations Under the NLRA?

The Board has held that an employer is authorized to make unilateral changes when “economic exigencies” compel prompt action. An underlying reason for not requiring bargaining when there is an economic exigency is that “an unforeseen occurrence, having a major economic effect, is about to take place that requires the company to take immediate action.”[3]

Economic exigency requires a “compelling business justification,” and an employer that attempts to prove economic exigency carries a “heavy burden.” A mere business necessity or inconvenience does not equate to an economic exigency that excuses bargaining. For example, “loss of an account representing 14 percent of revenue” was found not to qualify as an economic exigency.[4] 

Whether the COVID-19 situation triggers the economic exigency, exception will depend on the employer’s particular circumstances. The NLRB’s General Counsel recently issued a memo on March 27, 2020 providing examples of circumstances where employers experienced economic exigencies that allowed them to avoid decision bargaining. Although the memo does not provide specific guidance on bargaining obligations relating to COVID-19, some of the cases referenced indicate that a number of employer actions directly due to the COVID-19 situation could qualify for the economic exigencies exception. For example, in Port Printing & Specialties,[5] where the parties did not have an existing CBA, the Board held that an impending hurricane and the mandatory citywide evacuation that was ordered in anticipation of the hurricane were uniquely exigent circumstances that privileged the employer to layoff employees without bargaining it decision with the union. The Board, however, found that the employer violated the NLRA by not offering to bargain the effects of the layoff. 

While this guidance is helpful, an employer that plans to justify a unilateral change based on the economic exigency exception needs to be prepared to show that the change was compelled by the exigency and that the exigency was caused by external events, was beyond the employer control, or was not reasonably foreseeable.  

Must an Employer Still Bargain the Effects of Its Change?

The legal grounds that justify an employer’s unilateral change may not necessarily relieve the employer of its notice and bargaining obligations with the union, at least with respect to the effects of the change. For example, an employer’s decision to partially close one of its facilities may trigger the employer’s obligation to bargain over the effects of the closing on its unionized employees. Bargaining over the effects of such a decision “must be conducted in a meaningful manner and at a meaningful time, and the Board may impose sanctions to insure its adequacy.”[6] Even if an employer feels legally comfortable moving forward with a unilateral change, it should be prepared to engage in good faith negotiations over the effects of that change.

If Bargaining Is Required, How Can It Be Done in Light of Imminent Need to Act and Social Distancing Challenges?

The NLRA requires employers to give “adequate” notice and bargain in good faith with the union until it either reaches a deal or reaches impasse. Impasse typically occurs when, after exhaustive good faith negotiations, the parties are no longer willing to make concessions. How quickly impasse can be reached depends on the circumstances.

Employers needing to act quickly to respond to the COVID-19 epidemic can likely give the union expedited notice of the change and request the parties bargain quickly given that time is of the essence. If it is a single issue, the notice and meaningful opportunity to bargain needed to reach impasse can be done quickly. Depending on the circumstances, an employer may be able to reach impasse with the union on a single issue within a few days.

In some situations, the employer may need to postpone bargaining sessions, such as a situation where the employer is currently bargaining a new CBA. In those instances, employers may want to ask the union if it will agree to temporarily postpone bargaining (e.g., 30-60 days) until the COVID-19 situation appears to be receding. If a union is unwilling to postpone bargaining and the employer cannot meet, the employer should communicate the business and operational reasons for needing to delay bargaining. The key is proactive and timely communication with the union.

The various state shelter-in-place orders and need for social distancing may cause practical challenges for bargaining too. Usually good-faith bargaining requires face-to-face meetings at regular times. However, because the current situation is not business as usual and a union cannot compel the employer’s bargaining team to meet in person, particularly in violation of governmental orders, employers and unions can bargain by video conference or phone and exchange proposals by email. The Federal Mediation and Conciliation Service even offers certain technology to assist parties with bargaining in light of the pandemic.

How Does the Current Pandemic Impact Obligations for Responding to Information Requests? 

Under the Act, the employer has a duty to supply the union with information that is “relevant and necessary” to allow the union to bargain intelligently and effectively with respect to wages, hours, and other conditions of employment. For example, if the union asks the employer for the employer’s business plan in response to the COVID-19 situation, the employer may need to provide that information. 

The employer should try to provide its response by the deadline requested by the union and if it is unable to meet the union’s deadline, still stay engaged with the union and inform the union of the delay. Once the employer has gathered the relevant information or has otherwise determined that the requested information does not exist or is impossible to gather, the employer should respond in writing to the union. If the information requested is particularly sensitive and contains confidential information, the employer may wish to contact the union to see if an accommodation can be reached, such as limiting the use of the information through a confidentiality agreement. 

UNION ELECTIONS

On March 19, 2020, the Board announced that it was suspending all representation elections effective immediately through and including April 3, 2020. Although an employer has a free speech right to communicate with its employees, if the employer is facing a pending election, it should still be cautious in its communications with its employees as to avoid any accusation that it improperly tainted the union election. For example, the employer should not say anything to its employees that could be deemed a threat for voting for the union or a promise for certain benefits in exchange for voting against the union. 

UNION STRIKES

Most CBAs contain a provision prohibiting employees from striking during the term of the CBA. This provision would preclude employees from striking if an employer refused to modify the CBA mid-term, such as employees striking because the employer refused to changes hours or other working conditions to respond to issues related to COVID-19. 

Employers, however, should be mindful that even if the applicable CBA contains a no-strike provision, under the Act, refusal to work because of “abnormally dangerous conditions” is not a strike in violation of a no-strike clause.  For example, certain employees may argue that they are not being provided sufficient protective equipment, such as masks or gloves, while interacting in person with hundreds of potentially contagious customers per day. The employees’ decision to walkout of the job based on a good faith and objective belief that their working conditions are “abnormally dangerous” may not be violating the CBA.

The answer to many of the issues discussed above is heavily fact-based, and we may see new developments arise in the traditional labor area in response to the COVID-19 situation. We are closely monitoring various developments related to the COVID-19 situation and regularly updating our Coronavirus (COVID-19) Resource Center with advice on the myriad issues that continue to develop.



[1] MV Transportation, Inc., 368 NLRB No. 66 (Sept. 10, 2019).

[2] Newsome v. Northwest Airlines Corp., 225 F. Supp. 2d 822 (W.D. Tenn. 2002). This case was decided under the Railway Labor Act, which applies to airlines, railroads, and related companies. It is not binding precedent under the NLRA.

[3] Pleasantview Nursing Home, Inc. v. NLRB, 351 F.3d 747, 755-56 (6th Cir. 2003).

[4] Angelica Healthcare Servs. Grp., 284 NLRB 844, 853 (1987).

[5] 351 NLRB 1269 (2007). 

[6] First Nat’l Maint. Corp. v. NLRB, 452 U.S. 666, 681-82 (1981).