By:  Michael Rybicki, Esq.

A Board Majority has used Pressroom Cleaners, 361 NLRB No. 57 (September 30, 2014) to overrule Planned Building Services, 347 NLRB 670 (2006), a decision that had responded to the criticism of various Courts with respect to the remedies imposed by the Board in successorship cases. Members Miscimarra and Johnson filed a lengthy and well-reasoned dissent.

In Pressroom Cleaners the employer was found to have committed certain unfair labor practices and to be the successor to the bargaining relationship of its predecessor, a conclusion that was supported by the evidence. The Administrative Law Judge, applying Planned Building Services, directed that the employer have the opportunity in the compliance stage of the proceeding to limit its liability by showing that even in the absence of its unfair labor practices, it would not have agreed to the monetary provisions of the predecessor’s contract with the Union.

The Majority overruled Planned Building Services, which it dismissed as a “well-meaning” but “fundamentally flawed” attempt to balance two competing principles: placing the burden of uncertainty on the wrongdoer and avoiding a potentially punitive remedy. Coming down squarely in favor of potentially punitive remedies, the Majority issued a “make whole remedy” ordering “restoration of the predecessor’s terms and conditions until the parties bargain in good faith to agreement or impasse,” slip op. at p. 6.

While Members Miscimarra and Johnson concurred with the findings of successorship and unlawful discriminatory hiring practices, they dissented from the remedy imposed by the Majority as violating two of the cardinal principles embodied in the National Labor Relations Act, those being that the Board’s authority is remedial, not punitive, and that the Board may not impose any term of an agreement on the parties in a collective-bargaining relationship. The Dissent noted further that in Planned Building Services “the Board did not adopt the more extreme stand [the Ninth and D.C. Circuits] proposed of limiting the duration of the backpay period to a reasonable period of bargaining [but] instead … adopted the more modest approach articulated by the Sixth Circuit [permitting a successor] an opportunity to prove when any required bargaining would have resulted in impasse or an agreement on different terms than those set forth in the predecessor’s collective-bargaining agreement,” id at p. 12.

Coming on the heels of numerous other controversial decisions, see e.g., FedEx Home Delivery, 361 NLRB No. 55 (September 30, 2014) and CNN America, Inc., 361 NLRB No. 47 (September 15, 2014), we expect a lot of activity in the Courts of Appeal as employers challenge the current Board’s efforts to fundamentally re-write the law.