Labor & Employment Law Daily NLRB: Under ‘contract coverage’ standard, ADT’s unilateral implementation of six-day workweek lawful
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Tuesday, March 3, 2020

NLRB: Under ‘contract coverage’ standard, ADT’s unilateral implementation of six-day workweek lawful

By Ronald Miller, J.D.

Applying the “contract coverage” standard, the Board found that the employer’s implementation of a six-day workweek was within the compass or scope of language in the CBAs granting it the right to take that action unilaterally.

An employer did not violate Section 8(a)(5) and (1) of the NLRA by unilaterally implementing a six-day workweek for service and installation technicians at two of its facilities, ruled a three-member panel of the NLRB. The Board also reversed an administrative law judge’s finding that the employer acted unlawfully by unreasonably delaying in providing a union with requested information. According to the Board, the employer had no duty to bargain over the change and the union communicated to the employer that it was requesting information solely about the purpose of bargaining about the change. However, the Board agreed with the ALJ that the employer violated Section 8(a)(5) by bypassing the union and dealing directly with an employee when it granted him an exemption from the mandatory six-day workweek (ADT, LLC dba ADT Security Services, February 27, 2020).

Since 1968, the employer has had collective bargaining agreements with the union covering its service and installation technicians at two facilities. The CBA defined a “normal work schedule as a shift of eight and one-half hours with a 30-minute lunch period, five days per week. But it also provided that customer needs may periodically make it necessary to add an additional shift. The company first seeks qualified volunteers for such work. If there are no qualified volunteers then the less senior qualified person will be assigned to the work.

Mandatory six-day workweek. Typically, service and installation technicians’ regular schedule was a 40-hour, five-day workweek. However, on September 7, 2016, the employer emailed technicians and the union president, announcing that it would be implementing a mandatory six-day workweek at its Albany facility and a mandatory bi-weekly six-day workweek at its Syracuse facility in order to meet new “customer service targets” following the acquisition and integration of another company.

The union protested the employer’s decision, demanded that it rescind it, and asserted that the employer’s failure to bargain over the change was an unfair labor practice. Nevertheless, the employer implemented the decision, and maintained the six-day workweek at its Syracuse facility for approximately one month and until December 2016 or January 2017 at its Albany facility.

Refusal to bargain charge. The General Counsel alleged that the employer violated Section 8(a)(5) and (1) by failing and refusing to bargain with the union regarding implementing the six-day workweek. Alternatively, the General Counsel also alleged that the employer acted unlawfully under a different theory when it implemented the six-day workweek. According to the General Counsel, the employer modified the agreements without the union’s consent and thereby failed to continue in effect all the terms of the CBAs as required by Section 8(d), in violation of Section 8(a)(5) and (1).

For its part, the employer argued that the CBAs granted it the authority to determine the amount of work needed to conduct its business, to modify technicians’ schedules, and to assign technicians to work on scheduled days off at time-and-a-half pay.

Contract coverage standard. The Board rejected both of the General Counsel’s theories. The Board recently announced in MV Transportation, Inc., that it would apply the “contract coverage” standard to evaluate the merits of an employer’s defense that contractual language privileged it to make a disputed unilateral change without further bargaining with the union. Under the contract coverage standard, the Board examines “the plain language of the CBA to determine whether action taken by an employer was within the compass or scope of contractual language granting the employer the right to act unilaterally.”

The Board found that the employer’s implementation of a six-day workweek was within the compass or scope of language in the CBAs granting it the right to take that action unilaterally. The CBA provided for the payment of overtime wages for worked performed weekly in excess of 40 hours or scheduled days off. It also vested the employer the exclusive right “to determine the reasonable amount of work needed.” Read together, these provisions authorized the employer to determine the amount of work it needed the technicians to perform and to require them to work in excess of 40 hours a week or on scheduled days off to accomplish that work. Accordingly, the Board found that the agreements covered the employer’s decision to implement, temporarily, a six-day workweek, and it did not violate Section 8(a)(5) and (1) by doing so.

Contract modification. To determine whether an employer has unlawfully modified a contract by failing to adhere to its terms, the Board applies the “sound arguable basis” standard. Under that standard, if “an employer has a sound arguable basis for its interpretation of a contract and is not motivated by union animus or acting in bad faith,” the Board ordinarily will not find a violation.

Here, the Board found that the employer had a sound arguable basis for interpreting the CBAs as giving it the right to implement a six-day workweek for its service and installation technicians. There was no contention that the employer implemented the six-day workweek for anything other than legitimate business reasons. Further, the Board found that its interpretation of the contract language was reasonable, where a reading of relevant contractual provisions gave the employer the right to modify technicians’ regular work schedules.

The Board pointed out that the employer was in an “all hands on deck” situation, in which it needed every available employee to perform overtime work to meet customer order targets, so that it would have been nothing more than a formality for the employer to seek volunteers, whether they would have volunteered or not. Accordingly, the Board found that the employer adhered to the CBAs when it implemented the six-day workweek, and therefore dismissed allegations that it violated Section 8(a)(5) and (1).

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