Legal Alerts

11 Feb 2014

Another Gift From The NLRB To Unions: The Proposed New “Double Jeopardy” Arbitration Standard

The National Labor Relations Board (NLRB) has become the gift that keeps on giving…to unions. Another Gift From The NLRB To Unions, the NLRB reintroduced its “ambush election rules.” Now, it has signaled its intention to consider, and probably implement, a new standard for deferral to arbitration awards that, in many cases, will allow a union or individual grievant to litigate their case twice − once before an arbitrator and again before the NLRB.

In the past, the NLRB has deferred to an arbitrator’s award if: (1) The arbitration proceedings were fair and regular; (2) All parties agreed to be bound by the arbitrator’s decision; and (3) The arbitrator’s decision was not “repugnant to the purposes and policies” of the National Labor Relations Act ( Act). The NLRB also required that the arbitrator have considered the unfair labor practice issue alleged in the charge pending before the NLRB. The unfair labor practice issue was deemed to have been adequately considered if: (1) The issue under the collective bargaining agreement (CBA) was factually parallel to the unfair labor practice issue, and (2) The arbitrator was presented generally with the facts relevant to resolving the unfair labor practice issue. In practical application of this standard, the NLRB deferred to the arbitrator’s award in the vast majority of cases reviewed by the NLRB. Thus, the unfair labor practice issue was resolved in most of these cases through the informal dispute resolution mechanism negotiated by the company and union involved.

However, on Feb. 7, 2014 the NLRB issued a Notice and Invitation to File Briefs inviting the public to comment on its proposal to alter the standard for reviewing arbitration awards. Under the new standard, the NLRB would first shift the burden of proof from the party opposing deferral to the award (generally the union) to the party urging deferral to the award (generally the employer). Next, the NLRB would defer to an award only if: (1) The CBA incorporates the statutory right, or the statutory issue was presented to the arbitrator, and (2) The arbitrator correctly enunciated the applicable statutory principles and applied them in deciding the issue. If the standard is met, the NLRB would defer to the award unless it concludes the award is repugnant to the Act.

The NLRB’s proposed new standard would significantly restrict the NLRB’s deferral to arbitrator’s awards. The vast majority of unfair labor practice cases are filed by unions or individuals against employers. As a result, virtually all cases deferred by the NLRB’s Regional Directors to arbitration are filed against employers; and any adverse consequences flowing from the change in the standard would weigh almost exclusively on employers. In many cases, the union or individual grievant would be granted “two bites at the apple.” If the union or grievant lost before an arbitrator, they might still obtain relief through the NLRB. Conversely, the employer would be forced to defend essentially the same claim in two different forums: before an arbitrator, and before the NLRB.

Employers are well-advised to consult with our firm prior to negotiations with a union over terms of a new CBA. In many cases, the language of the CBAs should be revised in order to ensure that the CBA incorporates statutory rights under the NLRA and that the arbitrator is given authority to rule on statutory claims. In addition, we can devise strategies to reduce the risk that the employer will be subjected to “double jeopardy” by having to defend its actions before both an arbitrator and the NLRB. Call us today to arrange a time to meet to discuss how we can put these strategies to work for you and your company. If you have any questions about any labor relations matters, please contact Rob Seigel at rseigel@lowenbaumlaw.com; Corey Franklin at cfranklin@lowenbaumlaw.comMichael Lowenbaum at rml@lowenbaumlaw.com; or Mike Linihan at dml@lowenbaumlaw.com.


This E-Alert is intended as an informal summary of certain recent legislation, cases, rulings and other developments. This E-Alert does not constitute legal advice or a legal opinion and is not an adequate substitute for advice of counsel. This E-Alert is not intended to nor does it create an attorney-client relationship. The choice of a lawyer is an important decision and should not be based solely upon advertisements. If this E-Alert is deemed to be an advertisement please disregard this solicitation if you have already engaged a lawyer in connection with the legal matter referred to in this solicitation. You may wish to consult your lawyer or another lawyer instead of us. The exact nature of your legal situation will depend on many facts not known to us at this time. You should understand that the advice and information in this solicitation is general and that your own situation may vary. This statement is required by rule of the Supreme Court of Missouri.