D.C. Circuit: Valid Pre-hire Agreement Requirement is Not Anti-Union Motive for Terminations
All Employers with Employees in Washington, D.C.
March 7, 2023
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In International Brotherhood of Boilermakers v. NLRB, the D.C. Circuit Court of Appeals said employers can terminate employees under a pre-hire agreement when it expires without committing an unfair labor practice. Here, under a decades-old policy, Hawaiian Dredging employed workers only when it had a pre-hire agreement with a union. Pre-hire agreements are collective bargaining agreements that permit a construction company to contract with a union before it hires any union workers. Once a pre-hire agreement expires, either party can walk away and there is no requirement to continue to bargain in good faith. Hawaiian Dredging’s pre-hire agreement with multiple unions expired but they continued to hire Boilermakers welders while attempting to negotiate a new agreement. When it became clear that the relationship between the parties had ended, Hawaiian Dredging terminated 13 Boilermakers welders. The Boilermakers union, unsatisfied with the termination of its welders, took the case before the National Labor Relations Board (NLRB) and alleged unfair labor practices under the National Labor Relations Act (NLRA). After two reviews, the NLRB found that Hawaiian Dredging’s practice of employing workers only when it had a pre-hire agreement in place was a legitimate business practice. The Boilermakers union appealed to the D.C. Circuit Court of Appeals.
The Circuit Court ultimately agreed with the NLRB and deferred to their finding that Hawaiian Dredging did not commit an unfair labor practice when it terminated the Boilermakers welders. The policy of not hiring welders unless a pre-hire agreement with a union is in place was a neutral, non-discriminatory policy. When an employee protected by the NLRA is terminated, the NLRB can use two tests to decide whether the termination was a violation of the NLRA. The first test is whether an anti-union motive was the cause of the termination. Under the second test, an anti-union motive can be inferred when an employer’s action “is so inherently destructive of employee interests” that there is no need for proof of an underlying improper motive. Employers can show a legitimate and substantial business justification for its action to rebut the charge of an anti-union motive. Under the two tests, the court found conditioning work on a pre-hire agreement was a legitimate and substantial business justification for termination. The termination was a result of the requirement of having a valid pre-hire agreement in place and was not discriminatory. Since pre-hire agreements are unique to the construction industry, employers with collective bargaining agreements should consult with legal counsel prior to terminations to ensure the terms and conditions of the agreement are followed.
- Review employment terminations covered by collective bargaining agreements with legal counsel.
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