United States: NLRB Majority Stuns Nation By Ruling Employer Has Management Right, Chairman Dissents

Last Updated: November 22 2016
Article by Mark Theodore

In another example of the inconsistency of the current state of Board law, a 2-1 majority of the NLRB ruled that an employer not only had a management right but it wasn't necessary that this right be expressly set forth in the parties' contract. This is certainly odd because the NLRB went out of its way during the Summer to declare a pretty specific management rights clause was insufficient. What makes the recent decision an even greater oddity is that the Board majority did not include Chairman Pearce, who dissented to the finding.

In Weavexx, LLC, 364 NLRB No. 141 (November 2, 2016) the Board was confronted with a situation where the parent of the employer was trying to standardize payroll practices across its subsidiaries by insisting on bi-weekly payroll. The employer, Weavexx, a manufacturer of felt used in paper products, had a unionized facility in Mississippi. Weavexx had paid its employees on a weekly basis since 2002. Heeding the call of the parent, the employer informed the employees that it would be moving to a bi-weekly payroll, changing the practice of payment from every Thursday to every other Friday. There is no dispute the employer did not give notice to the union nor did it offer to bargain over the change.

The union filed grievances over the change. The employer denied the grievances, citing its management rights clause, which stated:

The Employer retains all authority not specifically abridged, delegated or modified by the Agreement, including, but not limited to, the right to make and enforce work and safety rules, and the right to subcontract work so long as the Employer is motivated to do so because of economic reasons and not to displace regular employees. . .During the term of this agreement, the Company will not implement new work rules or policies relating to terms and conditions of employment without notice to the Union and the opportunity for the Union to raise concerns and to grieve any change it deems unreasonable.

The union pursued the grievances to arbitration but also filed charges with the NLRB alleging a refusal to bargain. The Regional Director deferred the charges pending the outcome of the arbitration.

The arbitrator denied the grievance. Although the arbitrator cited to the management rights clause, ultimately he decided that the change to a bi-weekly pay period was a proper use of "management discretion" and should not be seen as a violation of "a binding past practice." Upon reading the arbitrator's decision, the Regional Director revoked the deferral and sent the case to trial concluding that the arbitrator's decision was "repugnant to the Act."

After an unfair labor practice hearing, the Administrative Law Judge ruled that the arbitrator did not properly consider the issues and the employer violated its duty to bargain with the union by not bargaining over the pay practices in violation of Section 8(a)(5). The employer appealed.

In a 2-1 decision (Miscimarra and McFerran), reversed the ALJ's decision and found no violation of the Act. The Board majority, citing Spielberg Mfg. Co., 112 NLRB 1080, 1082 (1955) noted that the Board will defer to an arbitrator's award "when the proceedings appear to have been fair and regular, all parties have agreed to be bound, and the decision of the arbitrator is not clearly repugnant to the purposes and policies of the Act." The Board held that it had deferred to an arbitrator's decision "where a reasonable interpretation of the decision was the employer was privileged to implement unilateral changes based on the management-rights clause contained in the parties' collective bargaining agreement." The Board relied on its prior decision in Smurfit-Stone Container Corp., 344 NLRB 658, 659-661 (2005) where the Board held deferral to an arbitration award was appropriate because

(1) the [employer] argued to the arbitrator that the management-rights clause privileged it to unilaterally implement the new attendance control policy; (2) the arbitrator referred to the [employer's] argument; (3) the arbitrator prominently quoted the management-rights clause; and (4) the arbitrator immediately followed his quotation of the management-rights clause with the assertion that the [employer] had the right to make rules.

In running through these factors the Board majority noted the employer argued the management-rights clause privileged its action, and the arbitrator quoted the management rights clause in his decision. Finally, "the arbitrator ultimately concluded that the 'Company's use of managerial discretion was proper and should not be seen as a violation of a binding past practice.'"

The Board majority acknowledged that the arbitrator discussed the employer's "noncontractual inherent management prerogatives" but concluded that the "arbitrator's decision is not dependent on that theory but contains sufficient textual evidence to establish that it is susceptible to the interpretation that [the arbitrator] relied on the management-rights clause." The Board majority thus concluded the arbitrator's decision was not repugnant to the Act and dismissed the complaint.

Chairman Pearce dissented, writing that he would find the arbitrator's decision was "inappropriate" because:

The arbitrator failed to make any finding whatsoever on the key contractual issue of whether the management-rights clause in a collective-bargaining agreement privileged the [employer's] unilateral changes. To the contrary, the arbitrator explicitly framed his inquiry around past practice and, as found by the administrative law judge, concentrated his analysis on the extra-contractual considerations pertinent to that inquiry.

In other words, the Chairman asserted there was no evidence the text of the management-rights clause relied upon by the employer did not reference the changes to the payroll practices. Because the parties' agreed upon management rights did not authorize the change, the arbitrator's decision was not defensible.

It would be very difficult to square this decision with other recent decisions of the Board. This is especially so because the make-up of the Board majority included Member Miscimarra, who up until now pretty much exclusively found himself in the dissent.

Management-rights makes strange bedfellows. While it is pure speculation, it does appear that the Board majority was swayed by the fact that the parties had submitted the matter to binding arbitration and that the arbitrator had considered the central defense of the employer that it was privileged by management-rights to make the unilateral change. Still, the fact that the management-rights clause was silent on the issue of payroll practices certainly makes this decision hard to fit within the recent pattern of management-rights related cases.

NLRB Majority Stuns Nation By Ruling Employer Has Management Right, Chairman Dissents

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

In association with
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement

Mondaq.com (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of www.mondaq.com

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about Mondaq.com’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to unsubscribe@mondaq.com with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to webmaster@mondaq.com.

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to EditorialAdvisor@mondaq.com.

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at enquiries@mondaq.com.

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at problems@mondaq.com and we will use commercially reasonable efforts to determine and correct the problem promptly.