Employer Violates NLRA by Attempting to Defeat Union Election by Promise of Improved Benefits

March 24, 2005

In NLRB and Graphic Communication Union v. Curwood, Inc., the employer, Curwood, was alleged to have violated the NLRA when it attempted to counter a union campaign by promising improvements in its pension benefits to employees in the voting unit. As a result of the promised increased benefits, the Union lost their election. It then filed objections and argued that Curwood violated the NLRA and that the election should be set aside. The Administrative Law Judge (ALJ) found that Curwood had committed unfair labor practices by: (1) announcing and promising benefits to discourage union support; (2) blaming the Union for the absence of further benefits; and (3) making an implicate promise of transition pension benefits.
The ALJ’ s decision was appealed to the Seventh Circuit Court of Appeals. The Court found that the NLRA provides employees with certain rights, including the right of self organization and the right to form labor organizations. The Act makes it an unfair labor practice for an employer to interfere with, restrain, or coerce employees in the exercise of their rights. Specifically prohibited under NLRA is conduct immediately favorable to employees, which is untaken with the expressed purpose of infringing upon their freedom of choice for and against unionization. The Court found that not all announcements or promises of benefits are unlawful. Such announcements or grants are unlawful only when done in order to discourage employees support of a union. The Court found in this case that the sole reason Curwood proposed a benefit increase was to discourage its employees from supporting the Union. Therefore, the Court upheld the finding that Curwood had committed an unfair labor practice.
If you have questions regarding the above, please contact any of the attorneys in the Employment, Benefits & Labor Relations Practice Group of Ruder Ware.

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