By: Colleen McMullen[*]
Published: April 14, 2023
I. INTRODUCTION
The history of organized labor in the United States spans over 150 years.[1] The National Labor Relations Act (NLRA), enacted in 1935, remains the controlling law on collective bargaining in the United States.[2] The NLRA defines collective bargaining as “the performance of the mutual obligation of the employer and the representative of the employees to . . . confer in good faith with respect to wages, hours, and other terms and conditions of employment.”[3] In other words, parties must collectively bargain in good faith.[4]
However, the “good faith” requirement of collective bargaining remains vague and without clear case law defining the term.[5] The Protecting the Right to Organize Act (“PRO Act”), passed by the United States House of Representatives in 2021, amends parts of the NLRA.[6] Some of these amendments clarify certain ambiguities in the collective bargaining process; nevertheless, the PRO Act still falls short in providing a statutory definition of good faith.[7]
II. BACKGROUND
The first organized labor group in the United States was the National Labor Union, founded in 1866.[8] The National Labor Union was the first organization to lobby Congress for an eight-hour workday and, although the organization ended in 1873 before such a goal could be achieved, it laid the foundation for future labor movements in the United States.[9]
The next major advance in the United States labor movement occurred in 1926, when the Railway Labor Act was passed.[10] The purpose of the Railway Labor Act was to further the government’s goal of preventing labor strikes and solving labor disputes within the railway industry.[11] The Act required employers and employees to negotiate pay and working conditions, and prevented employers from changing these aspects of employment without following the Act’s procedures.[12] The Railway Labor Act’s significance rests in its statutory provisions outlining detailed procedures that both employees and employers had to follow to resolve labor disputes before a strike could be considered lawful.[13]
Following the Railway Labor Act, the Great Depression caused a major shift from pro-labor to pro-industry policy, which led to the passage of the National Industrial Recovery Act in 1933.[14] The National Industrial Recovery Act attempted to lift the economy during the Great Depression.[15] To achieve this goal, it appointed prominent heads of industry to write industrial codes that would become law throughout the country.[16] These codes maximized profits while lessening companies’ responsibility to employees, which led to criticism from both antitrust and labor activists.[17] The National Industrial Recovery Act sought to maximize production efficiency and lift previous restrictions that were thought to be stifling industrial progress.[18] However, the National Industrial Recovery Act was short-lived: two years after its passage, the Supreme Court deemed it unconstitutional when it decided A.L.A. Schechter Poultry Corporation v. United States.[19]
Schechter Poultry Corporation led to the passage of one of the most significant advancements in the United States labor movement, the Wagner Act.[20] First enacted in 1935, the Wagner Act is now known as the National Labor Relations Act.[21] The NLRA created the National Labor Relations Board (NLRB),[22] which gave employees in the United States the right to organize, form unions, and collectively bargain.[23] Today, the NLRA continues to regulate the collective bargaining process between employees and employers.[24] The Act requires parties to “bargain collectively” and “confer in good faith with respect to wages, hours, and other terms and conditions of employment.”[25] Furthermore, the NLRA stipulates that it is an unfair labor practice for an employer “to refuse to bargain collectively with the representatives of his employees.”[26]
Nevertheless, while the NLRA and the NLRB are integral parts of United States labor law, the NLRA is not without its shortcomings.[27] First among these is that the NLRA does not define the term “good faith,” which leaves great room for interpreting whether parties are truly making an honest effort to reach a resolution in collective bargaining.[28] However, the Act does state that the NLRB will examine “objective criteria” to determine if a party is bargaining in good faith, “such as . . . willing[ness] to meet at reasonable times” and “whether the party is represented by someone who has the authority to make decisions at the table.”[29] Still, this criteria remains rather vague, without much guiding language in the Act itself.[30] This lack of guidance is further complicated by the NLRA’s statement that “parties are not compelled to reach agreement or make concessions.”[31] The requirement that parties collectively bargain in good faith, combined with the lack of specific directions on what good faith bargaining actually means, leaves holes in the collective bargaining process that can be taken advantage of.[32]
In 1962, the Supreme Court offered some guidance on the good faith requirement in collective bargaining when it decided NLRB v. Katz, where it concluded that the NLRB had the power to order parties to cease behavior that “is in effect a refusal to negotiate” or “reflects a cast of mind against reaching agreement.”[33] Katz determined that the NLRB had the power to find an employer’s unilateral change in their employee’s working conditions to be an act of bad faith, even if the employer did not act in “over-all subjective bad faith.”[34] However, while this holding led to a slightly more refined construction of what bad faith bargaining may look like, Katz also failed to provide an objective standard of what good faith bargaining looks like.[35] The Court did admit that there may be cases in which an employer’s unilateral action may be acceptable, but did not explain what such instances may be.[36] In 1967, the Court slightly expanded the NLRB’s power in NLRB v C & C Plywood Corporation, holding that the Board had the power to interpret a collective bargaining agreement and determine if an unfair labor practice had occurred.[37] But the Court once again refrained from defining good faith for purposes of collective bargaining.[38]
While Katz determined that a unilateral change in working conditions can be bad faith bargaining,[39] and C & C Plywood determined that the NLRB has the power to interpret collective bargaining agreements to potentially find an unfair labor practice,[40] there remains the question of what precisely the standard for good faith bargaining is.[41] Congress recently attempted to answer that question when it passed the PRO Act; and yet, nearly 90 years after the NLRA’s passage, the issue still remains unresolved.[42]
III. ANALYSIS
In hopes of addressing lingering ambiguities in the collective bargaining process, the House of Representatives passed the PRO Act in 2021.[43] Though the bill has not been officially signed into law yet,[44] the PRO Act amends the NLRA to include a timeline of when parties must sit at the negotiation table with one another to collectively bargain.[45] If signed into law, the PRO Act would amend existing law to require parties to begin collectively bargaining “[n]ot later than [ten] days after receiving a written request for collective bargaining . . . .”[46] The PRO Act also gives parties a timeline of when they may seek intervention if collective bargaining is not leading to an agreement.[47] Parties generally have 90 days to reach an agreement before either party may request the Federal Mediation and Conciliation Service to mediate.[48] The Federal Mediation and Conciliation Service then has an additional 30 days to “bring the parties to agreement by conciliation.”[49] If the Service is unable to do so, then a “tripartite arbitration panel” comprised of “one member selected by the labor organization, one member selected by the employer, and one neutral member mutually agreed to by the parties” will have another 120 days to resolve the dispute.[50]
The PRO Act would improve collective bargaining by prescribing a set timeline that parties must adhere to when attempting to reach an agreement.[51] However, beyond this timeline to use as a rubric, the PRO Act fails to define good faith in collective bargaining.[52] This lack of clarity renders the prescribed timeline of the PRO Act little more than a mechanism that parties may use to settle disputes where a party may be delaying the bargaining process.[53] Even with the PRO Act, the good faith requirement of collective bargaining continues to be ambiguous and without statutory definition.[54] In short, while the PRO Act improves the collective bargaining process by setting timelines to reach an agreement, it fails to address the question that courts and parties alike continue to grapple with—what is the definition of good faith in collective bargaining?[55]
IV. CONCLUSION
For almost 90 years, the National Labor Relations Act has required parties to collectively bargain in good faith.[56] The “good faith” requirement has been slightly refined by Katz and C & C Plywood, yet the Supreme Court remains more focused on defining acts of bad faith than providing an objective standard for determining good faith.[57] The PRO Act’s proposed NLRA amendments provide a more definite timeline for the collective bargaining process; but at the same time, the Act still falls short of providing an objective statutory standard for the concept of good faith in collective bargaining.[58]
Footnotes
[1] See Ellen Terrell, Founding of the National Labor Union and the 1st National Call for a 8-Hour Work Day, Libr. of Cong. (Nov. 24, 2020), https://bit.ly/3njXjxM.
[2] See National Labor Relations Act (1935), Nat’l Archives, https://bit.ly/40iMFWt (last updated Nov. 22, 2021).
[3] 29 U.S.C. § 158(d).
[4] See id.
[5] See 25 Am. Jur. 2d Good Faith in Collective Bargaining § 2 (1981).
[6] See generally Protecting the Right to Organize Act of 2021, H.R. 842, 117th Cong. (2021) (proposing several amendments to the NLRA).
[7] See id. §§ 101, 104(4)(K).
[8] See Terrell, supra note 1.
[9] See id.
[10] See James Albert House Jr., Labor Law—Railway Labor Act—Federal-State Conflict Over Union Shop, 33 N.C. L. Rev. 626, 628 (1955).
[11] See Dennis Alan Arouca, Damages for Unlawful Strikes Under the Railway Labor Act, 32 Hastings L.J. 779, 779–80 (1981).
[12] See id. at 780.
[13] See Joshua Akbar, Comment, Chaos in the Airline Industry: Picking up Where Association of Flight Attendants v. Alaska Left off, 4 U. Pa. J. Lab. & Emp. L. 571, 593 (2002) (citation omitted).
[14] See National Industrial Recovery Act (1933), Nat’l Archives, https://bit.ly/40xfNsQ (last updated Feb. 8, 2022).
[15] See id.
[16] See id.
[17] See id.
[18] See Forrest Revere Black, National Industrial Recovery Act and the Delegation of Legislative Power to the President, 19 Cornell L. Rev. 389, 396 (1934).
[19] See A.L.A. Schechter Poultry Corp. v. United States, 295 U.S. 495, 551 (1935).
[20] See Valerie A. Sanchez, A New Look at ADR in New Deal Labor Law Enforcement: The Emergence of a Dispute Processing Continuum Under the Wagner Act, 20 Ohio St. J. on Disp. Resol. 621, 646 (2005).
[21] See Theodore J. St. Antoine, How the Wagner Act Came to Be: A Prospectus, 96 Mich. L. Rev. 2201, 2201 (1998).
[22] See 1935 Passage of the Wagner Act, Nat’l Lab. Rels. Bd., https://bit.ly/3ZgbXmS (last visited Feb. 26, 2022).
[23] See National Labor Relations Act, supra note 2.
[24] See id.
[25] 29 U.S.C. § 158(d).
[26] Id. § 158(a)(5).
[27] See Robert P. Duvin, The Duty to Bargain: Law in Search of Policy, 64 Colum. L. Rev. 248, 286 (1964).
[28] See id.
[29] Employer/Union Rights and Obligations, Nat’l Lab. Rels. Bd., https://bit.ly/42IsZNe (last visited Feb. 26, 2023).
[30] See Duvin, supra note 27, at 286.
[31] Employer/Union Rights and Obligations, supra note 29.
[32] See Duvin, supra note 27, at 249–50.
[33] See NLRB v. Katz, 369 U.S. 736, 747 (1962).
[34] See id.
[35] See id.
[36] See id. at 748.
[37] See NLRB v. C & C Plywood Corp., 385 U.S. 421, 430–31 (1967).
[38] See id.
[39] See Katz, 369 U.S. at 748.
[40] See C & C Plywood Corp., 385 U.S. at 430–31.
[41] See Duvin, supra note 27, at 286.
[42] See infra Part III.
[43] See Don Gonyea, House Democrats Pass Bill That Would Protect Worker Organizing Efforts, NPR (March 9, 2021, 9:18 PM ET), https://n.pr/3JNLhUN.
[44] See id.
[45] See Protecting the Right to Organize Act of 2021, H.R. 842, 117th Cong. § 104(4)(K) (2021).
[46] Id.
[47] See id.
[48] See id.
[49] See id.
[50] Id.
[51] See id.
[52] See id. § 101 (amending several definitions in the NLRA, but not providing a definition of “good faith”).
[53] See id. § 104(4)(k).
[54] See Duvin, supra note 27, at 286.
[55] See H.R. 842 §§ 101, 104(4)(K); see also Duvin, supra note 27, at 286.
[56] See supra Part II.
[57] See supra Part II.
[58] See supra Part III.
About the Author
Colleen McMullen is a first-year J.D. candidate at Penn State Law. Originally from Rochester, NY, Colleen graduated summa cum laude from SUNY Geneseo with a B.A. in International Relations. Before enrolling at Penn State Law, Colleen worked as a barista and contributed to the now-national Starbucks union campaign. Colleen accepted a position with the Monroe County Supreme Court for this summer.
Suggested Citation: Colleen McMullen, Good Faith in Collective Bargaining: A Term Without Concrete Meaning, Penn St. L. Rev.: F. Blog (Apr. 14, 2023), https://www.pennstatelawreview.org/the-forum/good-faith-in-collective-bargaining-a-term-without-concrete-meaning/.