United States: Employer Did Not Violate Duty To Bargain Over Change To Christmas Gift Policy, NLRB Rules

What would the holiday season be without a Christmas gift case? A perennial problem for labor relations personnel is whether the yearly Christmas turkey given to employees is something that an employer must bargain over before (bah humbug) discontinuing. See, e.g., Q-1 Motor Express, Inc., 323 NLRB 767, 775 (1997).

In a decision issued shortly before Christmas, the NLRB held that an employer's change of an existing Christmas gift policy did not violate its duty to bargain because the employer had followed the procedure for changing the policy set forth in the collective bargaining agreement. In Howard Industries, Inc., 365 NLRB No. 4 (December 21, 2016), the employer, a unionized manufacturer of electronic transformers, had a "Christmas Gifts" policy that covered "employees and retired employees" whereby employees would be eligible for a "Christmas gift of a ham if the company deems so on a year to year basis." The employer always included in the definition of "employee" those who were out on medical leave or workers compensation as eligible to receive the Christmas ham.

The collective bargaining agreement of the parties contained what is commonly known as a zipper clause which stated:

The parties acknowledge that during the negotiations which resulted in this Agreement, each had an unlimited right to make demands and proposals with respect to any subject or matter not removed by law from the area of collective bargaining. Except as provided below, they may therefore each voluntarily and unqualifiedly waive the right for the life of this Agreement to bargain collectively with respect to any matter referred to or covered in this Agreement or with respect to any subject or matter not specifically referred to or covered by this Agreement.

Such language has long been held to act as a bar to further negotiations (it "zips up" the agreement) if either party does not wish to talk about a matter. This particular clause continued as follows:

However, if the Company wishes to change an existing policy, create a new policy, or modify job performance standards that affect the bargaining unit, advance written notice will be provided to the Union via email. If the Union wishes to negotiate over the changes it will notify the Company in writing within ten (10) calendar days of the receipt of the notification. If the Union does not serve written notification of a desire to negotiate over the policy or policy change, the Company may implement the change and the Union waives any arbitration or other legal remedies concerning the creation or modification of the policy.

The employer's Human Resources manager sent an email to the union representative attaching a proposed "Christmas Gifts" policy which defined changed the definition of employees to "active employees" and would necessarily mean that employees on leave would not receive the Christmas ham. The email incorrectly listed the date of the policy in effect. The union did not respond or otherwise engage the employer and the employer implemented the new policy. After employees who did not receive the Christmas gift complained to the union the union requested bargaining. The employer refused citing the zipper clause. The union filed charges and the NLRB issued complaint.

The Administrative Law Judge noted a case concerning a change would "normally require an analysis of issues such as whether the employer made a unilateral change regarding a mandatory subject of bargaining, and if so, whether the union clearly and unmistakably waived its right to bargain." The ALJ stated such an analysis was unnecessary because, "the parties created and agreed to a specific procedure that applies when [the employer] wishes to change an existing policy. . ." The NLRB General Counsel did not contend the waiver contained in the zipper clause was invalid. Under these circumstances the ALJ ruled, "the issue in this case, then, is whether [employer's decision] to implement its [new] gifts policy. . is protected by the collective bargaining agreement. I agree with [the employer] that it is."

Both the union and the General Counsel argued that the error in the employer's email that incorrectly listed the date of the policy somehow excused the union from requesting bargaining. The ALJ disagreed "that the incorrect date of the old policy invalidates [the employer's] notice to the Union. Even with the incorrect date of the old policy, the Union was still on notice under the procedures set forth in the collective-bargaining agreement." Indeed, the ALJ found that "[t]o the extent that the incorrect date of the old policy prompted questions, that should have provided the Union with even more reason to notify [the employer] that it wished to negotiate."

A unanimous three member panel of the Board upheld the ALJ's decision without comment.

One wonders why this case even made it to complaint. The union failed to request bargaining within the agreed upon timeframe and then immediately filed charges when it did not get its way. Arguably, the union violated its duty to bargain in good faith by filing Board charges despite the fact the language of the agreement said it waived "any legal remedies."

This case is a good example of very clear contractual language setting forth the procedure for changing policy. The employer followed the policy and the union didn't, and despite the language of the zipper clause saying the union had waived all remedial rights by failing to respond to the email notice the General Counsel still pursued a case through trial and appeal.

This case is yet another example of how inconsistent the NLRB can be when it comes to evaluating waivers of bargaining. The case demonstrates that even with crystal clear language regarding notice and opportunity to bargain, and the consequences for failing to respond, the NLRB may still insist that such language really doesn't mean what it says.

Employer Did Not Violate Duty To Bargain Over Change To Christmas Gift Policy, NLRB Rules

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