NLRB Restores ‘Clear and Unmistakable’ Waiver Standard

The following article was provided by Berchem Moses PC. It is reposted here with permission.

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The National Labor Relations Board recently limited an employer’s right to change their employees’ working conditions without approval from their union.

In 2019, the NLRB adopted the “contract coverage” test in MV Transportation.

Under this standard, an employer could exercise management rights and take unilateral action without providing a union notice and an opportunity to bargain over mandatory subjects of bargaining that fell within the “compass or scope” of the contract language.

This standard gave employers added flexibility in operating their businesses and permitted the review of management rights clauses using ordinary principles of contract interpretation.

Clear and Unmistakable Waiver Test

This employer-friendly standard was overturned by Endurance Environmental Solutions (decided Dec. 10, 2024), which re-instituted the “clear and unmistakable waiver” test.

Specifically, in Endurance, the management rights clause afforded the employer, a waste management company, the right to “implement changes in equipment.”

The employer informed the union that, according to this language, it intended to install security cameras in its trucks.

The management rights clause afforded the employer, a waste management company, the right to “implement changes in equipment.”

In response, the union filed an unfair labor practice charge, alleging that the employer must first bargain with the union over the installation.

The NLRB agreed with the union and held that the “changes in equipment” language did not refer to surveillance or electrical equipment, and thus, the union had not waived the right to bargain over the cameras.

Moreover, the NLRB stated, “We find that the contract coverage test adopted in 2019 undermines the [NLRA’s] central policy of promoting industrial stability by encouraging the practice and procedure of collective bargaining.”

Outcomes

The Endurance decision illuminates the difficulty in tailoring a management rights clause specific enough to meet the “clear and unmistakable waiver” standard as it often requires showing the parties explicitly discussed the potential change during bargaining, and the union agreed to waive its right to bargain it.

Nevertheless, this union-friendly standard should be familiar to employers as the “clear and unmistakable waiver” test was in place for 70 years from 1949 until 2019.

That being said, please consider that this reversion to the “clear and unmistakable waiver” test may not persist for long.

This union-friendly standard should be familiar to employers as the “clear and unmistakable waiver” test was in place for 70 years.

With the upcoming change of administration, the NLRB may soon re-evaluate the Endurance Environmental decision, along with other Biden-era, union-friendly NLRB rulings.

In the meantime, employers should review their collective bargaining agreements, particularly any broadly worded management rights clauses.

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About the author: Jordan Vazzano is an associate at Berchem Moses PC. His practice focuses primarily on labor and employment law.