Good Faith Bargaining and Zipper Clauses Under the LMRA

Introduction: Unilateral Implementation and the Duty to Bargain

The company's unilateral implementation of two new work rules without providing the union with prior notice or an opportunity to bargain constituted a violation of the duty to bargain in good faith under the Labor Management Relations Act (LMRA), as amended. At least one of the two new rules — that regarding bonus pay for perfect attendance — was a mandatory subject of bargaining (Fecteau). Management attempted to circumvent the LMRA by applying a zipper clause whose language is neither clear nor unmistakable in terms of waiving all bargaining rights. The union could sue by claiming that the zipper clause pertains only to matters already stated in the contract and not to new additions.

The Role and Limits of Zipper Clauses

The purpose of a zipper clause is to effectively put an end to all bargaining between the union and the company (Nakamura). Essentially, it relieves both parties from engaging in further negotiations over mandatory bargaining subjects that may be included in or added to the contract during its term. Companies will apply a zipper clause when they anticipate wanting to add rules later that they do not wish to negotiate with the union. The clause can be used to allow this, but its language must be very precise and must clearly acknowledge that both the union and the company waive the right to bargain.

Typically, such clauses do not appear in contracts because unions rarely agree to them. Instead, when a zipper clause does appear, it tends to be less precise, and the union does not waive its bargaining rights merely by acknowledging it (Nakamura). In this case, the zipper clause fails to meet the standard of clarity required to extinguish the union's right to negotiate over new mandatory subjects.

Mandatory Subjects of Bargaining: Bonuses and Testing

The right to bargain in this case involves the mandatory subject of bonuses, but it could also be argued to involve the testing of employees. There is a potential case for either, though the argument is clearest with respect to the issuance of bonuses. The National Labor Relations Board (NLRB) clearly identifies "bonus programs" and "merit increases" as mandatory subjects of bargaining. The company's rule regarding bonuses for perfect attendance is plainly a bonus program and a merit-based incentive increase (Schwartz 97).

However, "physical examinations," "health rules," and "drug/alcohol testing" are also clearly listed among the NLRB's mandatory bargaining subjects (Schwartz 97). Thus, the union could additionally argue that the testing-related rule is one over which it has the right to negotiate.

The new rule dictating that employees receive an extra dollar per hour for a week of perfect attendance and an extra dollar and a half per hour for a month of perfect attendance is an obvious attempt to institute a new bonus program — it cannot reasonably be characterized otherwise. Why, then, does the company claim it is not a mandatory subject for bargaining? The answer is plain: management does not want to negotiate these terms. Management attempts to circumvent the union's right to bargain by claiming that the "current contract language gave management the right to unilaterally implement the two rule changes... even if they were" mandatory subjects. Management thus first argues that the subjects are not mandatory, and then falls back on the position that, even if they are, the contract's zipper clause and other provisions support the company's right to add new rules unilaterally. The union disagrees — and has every right to do so, as management is clearly attempting to avoid its obligations by invoking the Management Rights clause, the Wages section, and the zipper clause in combination.

Management Rights Clause and the Provena Hospitals Precedent

This is, of course, only one interpretation of the case, and history has shown that legal interpretations frequently differ in their application. For example, in the case of Provena Hospitals, the employer asserted its right to implement a bonus pay change based on a Management Rights clause stipulating that management had the right to "change... and/or introduce new and improved" rules ("Implementing Work Rules During the Term of a Collective Bargaining Agreement"). The NLRB upheld the hospital's right to alter the contract without entering into bargaining because of this clause. A similar clause exists in the company's contract in the present case: management retains the "right... to issue, enforce and change Company rules."

Thus, while management's unilateral implementation of the two new rules without prior notice or a chance to bargain can be characterized as a violation of good-faith bargaining duties, it may also be argued that the Management Rights clause in Section 3 functions as a more effective mechanism than the zipper clause — providing management with a reserved right to alter the contract as it sees fit. This interpretation is not guaranteed, however, and it is quite possible that the NLRB would not reach the same conclusion in this case as it did in Provena. The language, context, and scope of the clauses differ, and outcomes in labor law are rarely certain.

Conclusion

While the company did attempt to implement new rules that were clear subjects of mandatory bargaining, and its zipper clause was less precise than required with regard to adding new rules to the contract, the Management Rights clause did state that management could "change" the contract. Whether this would be upheld by the Board remains uncertain. In terms of right and wrong, legal interpretation is always subject to debate — and in terms of employee-management-union relations, the best course of action is often compromise through collective bargaining in order to demonstrate the good faith that is positive and supportive of the overall goodwill any company wishes to cultivate.

References

Fecteau, Michelle. "Legal Boundaries of Collective Bargaining." Clas.Wayne.Edu. Web.

"Implementing Work Rules During the Term of a Collective Bargaining Agreement." Faegre Baker Daniels. 27 Sept. 2007. Web.

Nakamura, Lilybell. "How Zipper Clauses Work and Why They are Important." Calpelra.Org. 30 Sept. 2011. Web.

Schwartz, Bob. The Legal Rights of Union Stewards. MA: Work Rights Press, 2015. Print.