Employer's Unilateral Move to Shrink Unit Violates NLRA

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By Kevin McGowan

Feb. 25 — An electrical utility in Louisiana that unilaterally reclassified two categories of bargaining unit employees as supervisors during the union contract term violated the National Labor Relations Act regardless of whether the employees could properly be deemed supervisors, the U.S. Court of Appeals for the Fifth Circuit ruled Feb. 25.

Enforcing a National Labor Relations Board order, the court said Dixie Electric Membership Corp. committed an unfair labor practice by eliminating two systems operator job categories mid-contract and giving those employees new jobs outside the bargaining unit.

Consistent with NLRB precedent, the court's ruling protects unions and the employees they represent from employer attempts to unilaterally shrink bargaining units during the life of a contract.

Dixie argued the employees, control room dispatchers who mostly assign field utility workers to address power outages, properly are classified as supervisors.

But the court said the employees' possible supervisory status is beside the point.

Rather, Dixie's unilateral move to modify the bargaining unit's scope during the contract term, without the NLRB's approval or the consent of an International Brotherhood of Electrical Workers local, violated the National Labor Relations Act.

“It is clear, based on the facts, law and arguments properly before us, that the bargaining unit covered in the contract included systems operators,” Judge Leslie H. Southwick wrote. “By unilaterally removing those classifications of employees from the bargaining unit during the term of the contract, Dixie Electric violated the NLRA.”

Two Board Decisions

For more than 40 years, IBEW Local 767 has represented employees at Dixie's Baton Rouge facility, the court said. The parties' 2007-2011 collective bargaining agreement included systems operators among the bargaining unit employees.

But in August 2010, Dixie decided to adjust systems operators' duties and to classify them as supervisors. Dixie's chief executive met with Local 767's business agent in November 2010 to discuss the decision. Although the union objected and said it would file NLRB charges, Dixie effectuated its plan Dec. 1, moving the reclassified employees out of the bargaining unit.

In February 2011, Dixie and the union agreed on a new four-year contract, but the union reserved its objection to reclassification of the systems operators. The union filed NLRB charges in March 2011, arguing Dixie violated the NLRA by unilaterally removing those employees from the bargaining unit.

In 2012, the NLRB approved an administrative law judge's ruling that Dixie had violated the act. That decision was vacated after NLRB v. Noel Canning, 134 S.Ct. 2550, 199 LRRM 3685 (2014), which found that President Barack Obama's January 2012 recess appointments to the NLRB were unconstitutional, but a new NLRB panel again upheld the ALJ. 

Unit Remains Fixed During Contract

Denying Dixie's appeal and enforcing the board's order, the Fifth Circuit said the scope of a bargaining unit covered in a union contract is a “permissive subject of bargaining,” meaning an employer can't bargain to impasse over the “construction of an appropriate unit so as to exclude certain members.”

“The rationale underlying this principle is that the parties cannot bargain meaningfully about mandatory subjects, like terms and conditions of employment, ‘unless they know the unit of bargaining,' ” the court said. “For the same reasons, the Board has also long held that the scope of a unit, once established, cannot be unilaterally modified while a contract is in effect.”

Other federal appeals courts have said if an employer “could vary unit descriptions at will,” the employer would be able to “sever the link between a recognizable group of employees and its union” as the collective bargaining representative, “which would render a contract meaningless,” the Fifth Circuit said.

“We agree and hold that an employer who unilaterally removes a job title from a bargaining unit mid-contract violates the NLRA,” the court said.

It was undisputed that Dixie unilaterally modified the unit's scope, that the contract included systems operators, and that Dixie did so during the contract term without the NLRB's approval and “with the union's express disapproval,” the court said.

“We agree with the [NLRB] such action is an unfair labor practice,” Southwick wrote.

Dixie “implies” that because supervisors lack NLRA rights, it could remove systems operators from the bargaining unit regardless of the contract, the court said.

But the Fifth Circuit said it needn't address Dixie's argument based on alleged supervisory status because “it was unaccompanied by any legal support on appeal.”

Judges Patrick E. Higginbotham and Stephen A. Higginson joined in the decision.

Taylor Porter Brooks & Phillips LLP represented Dixie Electric. Attorneys from the NLRB and the Justice Department represented the board.

To contact the reporter on this story: Kevin McGowan in Washington at kmcgowan@bna.com

To contact the editor responsible for this story: Susan J. McGolrick at smcgolrick@bna.com