As we previously reported in April 2022, the National Labor Relations Board (“NLRB” or “Board”) General Counsel, Jennifer Abruzzo, asked the Board to revive the Joy Silk doctrine (which was rejected in 1969) and require employers to recognize unions without a secret ballot election. 

On August 25, 2023, the Board released its decision in Cemex Construction Materials Pacific, LLC, 372 NLRB No. 130 (2023), which falls short of a complete revival of the Joy Silk doctrine, but overrules existing precedent and establishes an easier way for unions to establish representation.  This decision, which comes on the heels of new final rules issued by the NLRB that paves the way for a much shorter timeframe for representation elections (see our discussion here), puts greater pressure on employers when faced with union organizing. 

Legal Background

Once union representation is established in the United States, the union becomes the exclusive representative of the employees in the bargaining unit. Since its inception, the Board has taken a variety of approaches to how such exclusive representation is established. Must it be by secret ballot election? Can the union meet the requirements by collecting authorization cards from a majority of employees in the unit? The Board recently swung the pendulum back towards the collection of authorization cards being sufficient.

Union demand sufficient unless good faith doubt.  Under the Joy Silk doctrine, once a union asserted majority status based on authorization cards, the burden of proof rested with the employer to demonstrate that it had a “good faith doubt” as to the union’s majority status.  In analyzing an employer’s good-faith doubt, the Board considered “all relevant facts in the case, including any unlawful conduct of the employer, the sequence of events, and the time lapse between the refusal and the unlawful conduct.”  If the employer was unable to satisfy this “good faith doubt” test, the Board would order the employer to recognize and bargain with the union without a secret ballot election.

Serious unfair labor practices can undermine a secret ballot electionTwenty years after Joy Silk, in NLRB v. Gissel Packing Co., the Supreme Court held that a bargaining order without an election is appropriate where a union has achieved majority support and an employer engages in unfair labor practices which “have the tendency to undermine majority strength and impede the election processes.”  In practice, Gissel bargaining orders have been rarely issued.

In Linden Lumber Division, Summer & Co., the Board overruled Joy Silk and abandoned the “good faith doubt” test, ruling that when confronted with authorization cards purportedly signed by a majority of employees, an employer could reject the cards and insist on a Board-conducted election—even without reason to do so—prior to engaging in bargaining. 

Board Develops A New Standard

In Cemex, the Board overruled Linden Lumber, and in its place, established a new standard, as follows:

“an employer violates Section 8(a)(5) and (1) by refusing to recognize, upon request, a union that has been designated as Section 9(a) representative by the majority of employees in an appropriate unit unless the employer promptly files a petition pursuant to Section 9(c)(1)(B) of the Act (an RM petition) to test the union’s majority status or the appropriateness of the unit, assuming that the union has not already filed a petition pursuant to Section 9(c)(1)(A).” 

The Board defined “promptly” as within two (2) weeks of the union’s demand for recognition.  The Board was careful to point out that this new standard does not require an employer to prove “good faith doubt” of majority status prior to filing a petition—rather, employers have the right to file a “RM” petition for an election to be held.    

However, after a petition is filed, if an employer subsequently “commits an unfair labor practice that requires setting aside the election, the petition (whether filed by the employer or the union) will be dismissed, and the employer will be subject to a remedial bargaining order.” 

Employers must now act quickly when faced with a request from a union for voluntary recognition, because the Board also noted in its decision that if the employer neither recognizes the union nor promptly files a petition, the union may file a failure to bargain unfair labor practice charge against the employer.  If the union establishes majority support, and the Board finds the employer violated the NLRA by failing and refusing to recognize and bargain with the union, the Board may issue a remedial bargaining order.

Lastly, the Board held that its new standard will apply retroactively, finding that doing so would not be a manifest injustice.

Applying this standard to the facts of the case, the Board found that the Employer engaged in coercive and intimidating tactics before, during, and after a union representation election. According to the Board, this misconduct warranted setting aside the election where ready-mix cement truck drivers and driver trainers voted against representation. In addition, the Board found that the Employer’s conduct warranted a remedial affirmative bargaining order pursuant to Gissel.

Member Kaplan’s Dissent

In partial dissent, Member Kaplan did not join his colleagues in issuing a bargaining order or in overruling Linden Lumber. In finding a bargaining order inappropriate, Member Kaplan pointed to changed circumstances since the Employer’s unfair labor practices.

Given the facts of the case, Member Kaplan believed that the portion of the decision overruling Linden Lumber was dicta and thus was “devoid of precedential effect.” 

Member Kaplan otherwise disagreed with the standard espoused by the majority, based on numerous reasons, noting that the new standard:

  • Undermines employees’ statutory rights by potentially forcing employees into unionization against their wishes;
  • Conflicts with the Supreme Court’s decision affirming the Board’s holding in Linden Lumber;
  • Does not include a reasoned explanation for step one of its standard, i.e. that affirmative bargaining orders will be issued to employers who decline a request for recognition without promptly filing a petition;
  • Conflicts with NLRB v. Gissel Packing and decades of circuit court precedent applying that decision;
  • Does not include an adequate justification for the second step of the new standard, i.e. that an affirmative bargaining order will be issued to employers who commit an unfair labor practice warranting setting aside an election; and
  • Should not apply retroactively.

Takeaways

This decision drastically changes how exclusive representation will attach. While the dissent seems to think the discussion of the new standard was “dicta” and contradicts Supreme Court precedent,employers will ignore it at their peril. Indeed, when confronted with a demand for recognition, employers now will have two weeks to decide whether to (a) accept recognition and bargain with the union or (b) file an RM petition to seek a government-supervised secret ballot election.

The Board did not address how bargaining unit issues will be resolved under the new pathway. It is often the case the unit sought by the union is different than the unit the employer asserts is appropriate. If the union petitions for a smaller unit and the employer in good faith asserts a larger unit is appropriate in its petition, is the risk of having the union imposed diminished? These and other questions will unfold as the case is applied.

Practically speaking, the decision also likely will result in more unfair labor practice charges being filed, given the greater potential likelihood that the Board will impose a bargaining order if the union loses the election. As a result, any conduct engaged in by the employer in communicating its position to its employees on unionization will be subject to scrutiny as the union attempts to bypass the vote in favor of a Board-imposed bargaining obligation.

We will keep you posted as developments occur.

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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.

Photo of Joshua Fox Joshua Fox

Joshua S. Fox is a senior counsel in the Labor & Employment Law Department and a member of the Sports, Labor-Management Relations, Class and Collective Actions and Wage and Hour Groups.

As a member of the Sports Law Group, Josh has represented several…

Joshua S. Fox is a senior counsel in the Labor & Employment Law Department and a member of the Sports, Labor-Management Relations, Class and Collective Actions and Wage and Hour Groups.

As a member of the Sports Law Group, Josh has represented several Major League Baseball Clubs in all aspects of the salary arbitration process, including the Miami Marlins, Boston Red Sox, Los Angeles Dodgers, Kansas City Royals, San Francisco Giants, Tampa Bay Rays and Toronto Blue Jays. In particular, Josh successfully represented the Miami Marlins in their case against All-Star Catcher J.T. Realmuto, which was a significant club victory in salary arbitration. Josh also represents Major League Baseball and its clubs in ongoing litigation brought by current and former minor league players who allege minimum wage and overtime violations. Josh participated on the team that successfully defended Major League Baseball in a wage-and-hour lawsuit brought by a former volunteer for the 2013 All-Star FanFest, who alleged minimum wage violations under federal and state law. The lawsuit was dismissed by the federal district court, and was affirmed by the U.S. Court of Appeals for the Second Circuit.

Josh also has extensive experience representing professional sports leagues and teams in grievance arbitration proceedings, including playing a vital role in all aspects of the grievance challenging the suspension for use of performance-enhancing drugs of then-New York Yankees third baseman Alex Rodriguez. Josh also has counseled NHL Clubs and served on the trial teams for grievances alleging violations of the collective bargaining agreement, including cases involving use of performance-enhancing substances, domestic violence issues, and supplementary discipline for on-ice conduct. He has played a key role in representing professional sports leagues in all aspects of their collective bargaining negotiations with players and officials, including the Major League Baseball, National Hockey League, the National Football League, Major League Soccer, the Professional Referee Organization, and the National Basketball Association,.

In addition, Josh has extensive experience representing clients in the performing arts industry, including the New York City Ballet, New York City Opera, Big Apple Circus, among many others, in collective bargaining negotiations with performers and musicians, the administration of their collective bargaining agreements, and in grievance arbitrations.

Josh also represents a diverse range of clients, including real estate developers and contractors, pipe line contractors, hospitals, hotels, manufacturers and public employers, in collective bargaining, counseling on general employment matters and proceedings before the National Labor Relations Board, New York State Public Employment Relations Board and arbitrators.

Josh has also recently served as an adjunct professor at Cornell University’s School of Industrial Labor Relations for the past two years, teaching a course regarding Major League Baseball salary arbitration.

Prior to joining Proskauer, Josh worked for a year and a half at the National Hockey League, where he was involved in all labor and employment matters, including preparations for collective bargaining, grievance arbitration, contract drafting and reviewing and employment counseling. Josh also interned in the labor relations department of Major League Baseball and at Region 2 of the National Labor Relations Board. He was a member of the Brooklyn Law Review and the Appellate Moot Court Honor Society and served as president of the Brooklyn Entertainment and Sports Law Society.

Photo of Ariel Brotman Ariel Brotman

Ariel Brotman is an associate in the Labor & Employment Department and a member of the Employment Litigation & Arbitration Group. She represents employers in all aspects of employment litigation, including wage and hour, wrongful termination, discrimination, harassment, retaliation, whistleblower, trade secrets, and…

Ariel Brotman is an associate in the Labor & Employment Department and a member of the Employment Litigation & Arbitration Group. She represents employers in all aspects of employment litigation, including wage and hour, wrongful termination, discrimination, harassment, retaliation, whistleblower, trade secrets, and breach of contract litigation, in both the single-plaintiff and class-action context. She also counsels employers on a diverse range of workplace issues.

Ariel earned her J.D. from USC Gould School of Law, where she was a member of the Southern California Interdisciplinary Law Journal. During law school, she was also a clinical student in the University of Southern California Immigration Clinic. In addition, she served as a judicial extern to the Honorable Robert N. Kwan in the United States Bankruptcy Court, Central District of California.