The Obligation to Bargain During the Coronavirus Emergency

On March 27, 2020, Peter B. Robb, General Counsel of the National Labor Relations Board (the Board or NLRB), published GC Memorandum 20-04 which summarizes the leading NLRB cases addressing the duty to collectively bargain during emergency situations like the novel coronavirus pandemic. While the memo does not serve as an advisory opinion of how the Board will treat Section 8(a)(5) failure to bargain allegations related to COVID-19 issues, it highlights cases which demonstrate how the Board has treated the bargaining obligation during other emergency situations like hurricanes, ice storms, and 9/11.

In sum, the cases cited by the General Counsel in GC 20-04 articulate the same underlying principle. Under Board law, an employer will be excused from taking unilateral action without bargaining with its employees’ collective bargaining representative if an extraordinary and unforeseen event creates a major economic effect on the employer which “compels” an employer to take swift and immediate unilateral action. While the Board may excuse an employer’s unilateral action based on “economic exigencies” as they are called, economic exigencies do not absolve an employer of its responsibility to provide notice to the union of its unilateral action and an opportunity to bargain over the effects of its unilateral action, even if effects bargaining cannot occur until sometime after an employer’s unilateral action.

In the wake of the COVID-19 pandemic, the cases highlighted by the General Counsel will prove useful to those employers with unionized workforces who contemplate a reduction in force, layoff, business closure or other drastic action in response to the COVID-19 pandemic.

In determining whether an employer is entitled to take unilateral action, employers who have collective bargaining agreements in effect should first determine whether there is language in the agreement which grants them the authority to act on their own initiative. Certain management rights clauses and zipper clauses, when read under the Board’s current contract coverage standard, may demonstrate that a union has waived its right to bargain over certain issues and therefore provides an employer with a contractual basis to make decisions unilaterally.

If contract language does not support an employer’s unilateral action, an employer should next assess whether it has a duty to bargain concerning the unilateral action it seeks to take. While matters such as layoffs and reductions in force are mandatory subjects of bargaining, an employer’s decision to close operations is not a mandatory subject of bargaining when the decision is not based on labor costs and bargaining with the union would be futile.

If the unilateral action is not a mandatory subject of bargaining, then the employer’s inquiry may stop there.  However, if an employer has determined that its unilateral action may only be excused based on the economic exigencies exception set forth in Port Printing & Specialties, 351 NLRB 1269 (2007), then the employer must assess whether the COVID-19 pandemic is necessarily compelling an employer to take swift immediate unilateral action. While the pandemic is no doubt an unforeseen event, an employer’s ability to be excused from engaging in unilateral action because of the pandemic rests on the employer’s ability to show that the pandemic compelled the unilateral action.