Employers whose employees want to get rid of their union just received some good news from the National Labor Relations Board. Under prior Board law, employers who had a contract with a union who received a petition indicating employees no longer wanted a union had a dilemma. Most union contracts contain recognition clauses. Board law also provides for a “contract bar” preventing employers from withdrawing recognition while a contract (up to three years long) is in effect. So even if an employer received a valid anti-union petition signed by all of its employees two months before its contract expired, the employer could not withdraw recognition until after the contract expired. The employer could only give notice that it planned to withdraw recognition after the contract expired, also known as an “anticipatory withdrawal.”

This delay created a legal problem for employers. Under Levitz Furniture Co., 333 NLRB 717 (2001), the Board evaluated whether a union lacked majority support at the time of actual withdrawal. So after an employer lawfully announced its plan to withdraw recognition two months later, the union could use the two months to gather evidence of restored majority support before the actual withdrawal. The law did not require the union to provide this evidence to the employer. As a result, an employer could unlawfully withdraw recognition even though it had no idea the union had regained majority support. Even worse, unlawfully withdrawing recognition is a very serious unfair labor practice with significant ramifications if the employer makes changes to terms and conditions of employment without bargaining with the union. Any unilateral changes in that scenario would be unlawful.

In Johnson Controls, Inc., 368 NLRB No. 20 (July 3, 2019), the Board eliminated this dilemma. Under Johnson Controls, an employer who receives, within 90 days of contract expiration, lawfully obtained proof that the union has lost majority support can still discontinue bargaining and notify the union that it plans to withdraw recognition when the contract expires. The Johnson Controls change is this: if the employer gives this notice, the Board will no longer consider whether a union has reacquired majority support at the time of actual withdrawal. If a union wishes to prove it has regained majority support, the union must now petition the Board for a secret-ballot election within 45 days after the employer announces it will withdraw recognition. If the union files a petition, the Board will process it regardless of whether the contract has expired.

During this 45-day period, the employer may choose not to withdraw recognition even if the contract expires during that window and the union has not yet filed an election petition. If the union files an election petition, the employer may also wait to withdraw recognition until after the election. This “safe harbor” allows employers to avoid potentially unlawful withdrawals of recognition.

Johnson Controls also addresses how and when employers can change employees’ terms and conditions of employment after contract expiration. If the union does not file an election petition within 45 days from the date of the employer’s notice, the employer may make unilateral changes after the contract expires. If a union files a petition for an election, the employer acts at its peril if it changes terms and conditions of employment. Changes made after the petition (and after the contract expired) and before the election could be objectionable under the Board’s usual election rules. If the union loses the election and there are challenged ballots or objections, the employer acts at its peril if it makes unilateral changes depending on the outcome of the challenges or objections. If the union wins the election and the employer challenges ballots or files objections, the employer again acts at its peril if it makes unilateral changes depending on the outcome of the challenges or objections.

An employer contemplating withdrawal of recognition should consult with counsel and carefully consider all aspects of the situation before taking any action.