Just When You Thought You Were All Zippered Up . . .The NLRB Issues a New Decision on Zipper Clauses
If you are gearing up for union negotiations in 2024, do not miss the opportunity to review current and past practices that may not have been incorporated into expiring collective bargaining agreements. Trust me, it will be worth the effort to dig up and review all of the side letters, settlements and memoranda of agreement that the parties have entered into since the last CBA was signed. You should insist that the Union engage in that effort too, especially if you intend to propose or freshen up an integration or zipper clause.
What’s the Difference?
Last week, the National Labor Relations Board issued a decision in Twinbrook OpCo LLC, 373 NLRB No. 6, where it noted that its own General Counsel mislabeled an integration clause a zipper clause. Although the two terms are often used interchangeably, the NLRB explained that an integration clause “’exclud[es] from coverage any external agreements not made an explicit part of the parties’ collective bargaining agreement,’” but a zipper clause states “that the parties have had the opportunity to bargain over all mandatory subjects of bargaining and that they waive their right to bargain over such matters during the term of the agreement.” Id. at n. 4 (citations omitted).
Why does it matter? A brief case study.
Twinbrook OpCo purchased a skilled nursing facility and offered its employees continued employment, at their same rate of pay. Then, Twinbrook OpCo continued the prior owner’s practice of paying bargaining unit employees a shift differential for working second or third shifts. The company even increased the amount of that shift differential, without notifying the union that represented those employees or giving the union an opportunity to bargain over the change. Eventually, Twinbrook OpCo and the union agreed upon terms for their own CBA, which (a) did not include any reference to a shift differential; (b) provided that no employee’s rate would be lowered; and (c) contained an integration clause that provided:
This Agreement represents the entire understanding between the parties’ and there are no agreements, conditions, or understandings, either oral or written, other than as set forth herein. It is further agreed that no amendment, change, modification or addition to this Agreement shall be binding upon either party hereto, unless reduced to writing and signed by both of the parties.
Id. Twinbrook OpCo paid that increased shift differential for the first pay period covered by the new CBA before discontinuing the practice entirely, without notifying the Union.
Then what happened?
The union filed an unfair labor practice charge, asserting that the company violated Section 8(a)(1) and (5) of the National Labor Relations Act when it ceased making the shift differential payments without providing the union with notice and the opportunity to bargain. The NLRB sided with the union, holding that (1) the CBA did not authorize the company to unilaterally eliminate shift differential payments and (2) the union did not waive its right to bargain over the termination of those payments.
In short? The integration clause was not a clear and unmistakable waiver of the Union’s right to bargain over a change in a mandatory subject of bargaining.
So, what should my company do?
If you are on your company’s bargaining team, two things should be at the top of your list when it comes to integration clauses and zipper clauses. First, prepare. Second, establish a clear record of bargaining.
- Get all of those past practices, settlements, side letters and memoranda of understanding out on the table. If both parties agree that a practice should continue, incorporate it into the CBA.
- If the parties do not agree to incorporate a practice or agreement into the new CBA, make it very clear that the practice will cease with the expiration of the old CBA.
- If your CBA does not already have a zipper clause and/or an integration clause, propose them.
- If your CBA does contain these tools, make them a distinct part of the negotiations. Make it clear that the parties are starting the new CBA’s term with a clean slate; that any past practices and agreements are superseded by the terms of the new CBA; and that the parties have waived any right to negotiate over matters contained in the CBA.
Contact Jennifer Will or any member of the McNees Labor & Employment Team for assistance with labor relations or collective bargaining.
