The Acting General Counsel of the NLRB, Lafe Solomon, continued to shake up the way matters are handled at the agency, by issuing new guidelines for the handling of pre- and post-arbitration cases.  The new policy guidelines will have an immediate impact on cases where the employment action (usually a discharge) has prompted both a grievance (alleging a violation of the collective bargaining agreement) and an unfair labor practice charge (alleging violation of the National Labor Relations Act).  The most important impact of these new guidelines is that it is now much more likely that should an employee not prevail in the grievance, he or she will still be able to seek the same remedies (reinstatement, backpay, etc.) through NLRB processes.

Post Arbitration Deferral – The burden shifts. Up until the new guidelines were issued, the NLRB considered that an arbitration decision fully resolved both contractual (grievance) and statutory (unfair labor practice charge) concerns where the arbitrator “was presented generally with the facts relevant to resolving the unfair labor practice.”  See Olin Corp., 268 NLRB 573, 573-574 (1984).  Under this deferral policy, the employer needed only to try the case one time.  If the arbitrator ruled in favor of the employee, there usually was no need to pursue the unfair labor practice charge.  Likewise, if the employer won the arbitration, the NLRB typically took the position that no further processing of the NLRB charge was necessary, because the arbitrator had considered the same or a similar set of facts.

Concluding that this policy is “distinctly at odds with that which prevails in other areas of employment law,” Solomon issued new guidelines for evaluating post-arbitration deferral issues.  Specifically, the GC Memorandum states that the Board should “no longer defer to an arbitral resolution unless it is shown that the statutory rights have been considered by an arbitrator.”  Further, the guidelines now state that “the party urging deferral should have the burden of showing that the deferral standards articulated above have been met.”

The new guidelines are significant, and likely will prolong the resolution of cases which are the subject of both arbitration and unfair labor practice charge allegations, because:

  • Employers will now have to ensure that the arbitrator specifically considers the NLRA implications of the discharge.
  • Because the Employer has the burden of proof in a discharge grievance, it will now have to prove as part of its case that it did not violate the NLRA.
  • Raising issues concerning the NLRA in a grievance arbitration necessarily will prolong the hearing itself because of the additional proof needed.
  • Raising an NLRA implication will force the Union to present its own evidence to support how the activity of the employee’s activity was protected by the NLRA.
  • It likely will take longer to receive the arbitration award because the arbitrator now has to articulate in the decision how the facts are interpreted under both the NLRA and the parties’ contract.
  • The cost of arbitration will increase, because the possibility of having to re-litigate the same issue in front of the NLRB at a later date will cause more employers to call for a formal transcript of proceedings to memorialize witness testimony.  Arbitrations also could cost more because of the additional hearing and decision-writing time necessary to deal with the NLRA issue.
  • An employer who prevails will now have to submit the arbitration to the NLRB for scrutiny.
  • It is possible the NLRB could conclude the arbitration decision, though rooted in the same facts that led to the unfair labor practice charge, is not sufficient for deferral.  It is also possible the NLRB could conclude the arbitrator’s decision did not sufficiently articulate the rationale concerning the NLRA or, simply, that the arbitrator was wrong.  Under any of these scenarios, the NLRB automatically would proceed to issue complaint on the unfair labor practice allegations, which would then be litigated through NLRB processes.

Pre-Arbitration Deferral.  In his GC Memorandum, Solomon also addresses pre-arbitral deferral.  Before the issuance of the memorandum, deferral of cases involving NLRA allegations was standard if there was agreement between the employer and union.  Noting that “substantial time may pass while the arbitration process proceeds when a case is deferred. . investigation of the alleged unfair labor practices is more difficult.”  In order to prevent such hindrances to investigation, the Region should take affidavits “from the Charging Party, and from all witnesses within the control of the Charging Party,” before deciding whether deferral is appropriate.

Like the new post-arbitration deferral guidelines, this policy can only make resolution of the issue harder, because:

  • A person (or Union) filing an unfair labor practice charge now will have to swear under oath as to the underlying facts; before the new guideline, the Charging Party need only have made allegations.  The requirement to articulate the allegations may only serve to raise the stakes as it provides a formalization (and therefore length) to the process.
  • Once the allegation has been articulated to the NLRB the Union and the employee will pursue it to its fullest extent at the grievance hearing.

Under these new pre- and post-arbitration guidelines, the probability of the process for resolution  of the issue taking longer and costing more seems high.  Employers now have to be very careful in deciding whether it is even worth deferring a case to arbitration, and if it is, how additional scrutiny can be kept to a minimum. If a case is deferred to arbitration, the employer will have to  be much more careful in the selection of arbitrators to ensure that the NLRA implications are fully considered.

The General Counsel Memorandum, issued January 20, 2011 can be found here GC Mem 11 05 012011.pdf


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Photo of Mark Theodore Mark Theodore

Mark Theodore is a partner in the Labor & Employment Law Department. He has devoted his practice almost exclusively to representing management in all aspects of traditional labor law matters throughout the U.S. He is Co-Chair of Proskauer’s Labor-Management and Collective Bargaining Practice…

Mark Theodore is a partner in the Labor & Employment Law Department. He has devoted his practice almost exclusively to representing management in all aspects of traditional labor law matters throughout the U.S. He is Co-Chair of Proskauer’s Labor-Management and Collective Bargaining Practice Group.

Some recent highlights of his career include:

  • Successfully defended client against allegations that it had terminated a union supporter and isolated another. T-Mobile USA, Inc., 365 NLRB No. 15 (2017).
  • Successfully appealed NLRB findings that certain of client’s written policies violated the National Labor Relations Actions Act.  T-Mobile USA, Inc., 363 NLRB No. 171 (2016), enf’d in part, rev’d in part 865 F.3d 265 (5th Cir. 2017).
  • Represented major utility in NLRB proceedings related to organizing of planners.  Secured utility-wide bargaining unit. Bargained on behalf of grocery chain.  After negotiations reached an impasse, guided the company through lawful implementation of five year collective bargaining agreement.
  • Coordinated employer response in numerous strike situations including a work stoppage across 14 western states of the client’s operations.

Mark has extensive experience representing employers in all matters before the NLRB, including representation petitions, jurisdictional disputes and the handling of unfair labor practice charges from the date they are filed through trial and appeal. Mark has acted as lead negotiator for dozens of major companies in a variety of industries, including national, multi-unit, multi-location, multi-employer and multi-union bargaining. Mark has handled lockout and strike situations, coordinating the clients efforts.

In addition, Mark has handled hundreds of arbitrations involving virtually every area of dispute, including contract interest arbitration, contract interpretation, just cause termination/discipline, benefits, pay rates, and hours of work.