National Labor Relations Board’s General Counsel Issues Memorandum Regarding an Employer’s Duty to Bargain in Emergencies

March 30, 2020

On March 27, 2020, in light of the many issues employers are facing during the COVID-19 pandemic, the National Labor Relations Board’s (the “Board”) General Counsel, Peter B. Robb, issued Memorandum GC 20-04 ( the “Memorandum”) on a unionized employer’s duty to bargain in emergency situations. Although the Memorandum does not provide specific advice, the Memorandum contains summaries of decisions in which the Board considered an employer’s duty to bargain in emergencies, including public emergencies and emergencies unique to a particular employer. 

Under the National Labor Relations Act (“NLRA”), an employer is required to bargain with its employees’ union representatives concerning mandatory subjects of collective bargaining such as wages, hours of work, and layoffs.  Specifically, employers cannot take unilateral action regarding mandatory subjects of collective bargaining without first reaching agreement with the employees’ union representatives or reaching an impasse in negotiations.  

Exceptions to an Employer’s Duty to Bargain

The decisions cited in the Memorandum reiterate the Board’s standard in Bottom Line Enterprises, 302 NLRB 373, 374 (1991),  that an exception to the duty to bargain exists where the employer can demonstrate that economic exigencies compelled prompt action and such exception is limited to extraordinary events that are an unforeseen occurrence having a major economic impact requiring the employer to take immediate action. 

Although the determination is fact specific, the Board held that employers did not have a duty to bargain with respect to their unilateral decisions to layoff employees during certain public emergencies, such as a mandatory city evacuation in a hurricane or in the aftermath of 9/11. Similarly, the Board found exceptions to the duty to bargain with respect to emergencies unique to the employer where the situation was unforeseen and had a major economic effect, such as an employer’s credit line being discontinued. However, in several cases the Board found that an employer had a duty to bargain where the decision was not based on an unforeseen occurrence, including chronic problems of which the employer was aware. 

Regardless of the type of emergency and whether the decision constitutes an exception to the duty to bargain under the NLRA, the employer is still required to bargain over the effects of its decision. 

Takeaway for Employers

Employers with unionized workforces that are faced with the prospect of taking unilateral actions in response to the COVID-19 pandemic, such actions that are normally subject to bargaining, should carefully review whether these actions are the result of economic exigencies that are unforeseen and need to be implemented immediately. If employers take such actions without consulting with the union, employers should immediately notify the union of the actions taken and offer to bargain with the union regarding the effects of these actions.

These materials were prepared by Putney, Twombly, Hall & Hirson LLP prior to their combination with Bond, Schoeneck & King for informational purposes only and are not intended as legal advice or advertisement of legal services. Transmission of the information is not confidential and is not intended to create an attorney-client relationship or an attorney-client privileged communication. You should not act upon any of the information contained in these materials without seeking the advice of your own professional legal counsel.