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D.C. Circuit rules that NLRB failed to adhere to its own precedent in unilateral change case

Posted in Labor

Due to the nature of the political appointment process for NLRB members, Board law often changes as the political makeup of the Board shifts. Although the Board is free to change its interpretation and application of its prior decisions, it cannot do so without explaining why the prior precedent should no longer be applied, as the United States Court of Appeals for the  D.C. Circuit reminded the Board in E.I. Du Pont De Nemours and Company v. NLRB.

In that case, the employer sought review of the Board’s decision that it violated the Act by unilaterally implementing changes in its employee benefits program after its collective bargaining agreement with the union expired, but before a new agreement was reached. Du Pont argued that it had a past practice of making changes to its benefits programs each year for union and non-union employees, and that, under prior Board decisions such as Courier-Journal, if an employer can show a past practice of making changes to employee benefits (in that case, health insurance premiums), it does not need to bargain with the union when it acts consistent with that practice by making similar changes during negotiations.

In its decision, the Board distinguished Courier-Journal, pointing to the fact that, although Du Pont had shown a past practice of making changes to benefits during the term of the parties’ contract, it had not shown a past practice of making such changes between contracts. The D.C. Circuit criticized this false distinction, stating that “we see no reason why it should matter whether that past practice first arose under a CBA that has since expired.” The court concluded that the Board had departed from its own precedent with providing a “reasoned justification” for doing so. The court remanded the case to the Board to “either conform to its [existing] precedent… or explain its return to the rule it followed in its earlier decisions.” We will monitor this case and report when the Board issues a new decision following the remand.