Like many areas of federal labor law, there are different rules for construction industry employers. One major difference is in how employers become unionized. Typically, under Section 9(a) of the National Labor Relations Act, a union becomes a collective bargaining agent of employees only after a majority of employees show support for union representation. In other words, the employees chose whether to be represented by a particular union. However, under Section 8(f) of the NLRA, construction industry employers can chose to become union without any showing of majority support by employees. In fact, construction industry employers don’t need to have any employees at all to sign a “8(f) agreement.” Thus, these agreements have become known as pre-hire agreements.
Section 8(f) is said to have arisen to address the unique nature of the construction industry where the size of an employer’s workforce can fluctuate from project to project, where projects can be short term in nature, and where employees migrate to different construction industry employers frequently.
The formation of an 8(f) agreement is but one difference between it and a 9(a) agreement. Another concerns the duty imposed on the employer at the conclusion of the agreement. Under a 9(a) agreement, that is one where the employees have indicated majority support for the union, after the bargaining agreement expires, an employer has a duty to continue to bargain with the union in good faith for a new agreement. However, under a 8(f) bargaining agreement, once the agreement expires the employer has no such duty and is free to become merit shop (non-union) or to enter into an agreement with a different union.
Being able to walk away from an 8(f) agreement at its expiration bestows obvious major benefits on an employer and works to the detriment of the union. Therefore, many Section 8(f) agreements will contain language that attempts to convert them to Section 9(a) agreements by stating that the employer agrees that a majority of its employees support the union.
Last week in Colorado Fire Sprinkler, Inc. v. NLRB, the DC Circuit set forth the parameters of how a Section 8(f) agreement can be converted into a Section 9(a) agreement. In that case the contractor signed a collective bargaining agreement with a local union. The Court noted that the agreement was a standard multi-employer agreement negotiated between the local and a multi-employer association, the National Fire Sprinkler Association, which the Court referred to as “cookie cutter.” As such, the employer did not negotiate any specific terms with the union. The agreement contained language that stated “the Company acknowledged the Union’s status as the exclusive bargaining representative of its employees pursuant to Section 9(a) of the National Labor Relations Act.” The contractor renewed the agreement on several occasions until 2010 when the employer did not renew the agreement. The union then filed unfair labor practice charges against the employer claiming that it had unilaterally changed the terms and conditions of employment and refused to continue contributing to the union’s health and welfare benefit fund.
Both the administrative law Judge and the National Labor Relations Board found that the agreement had been converted into a Section 9(a) agreement. However, on appeal, the DC Circuit reversed. In addition to clarifying the test for when an 8(f) agreement is converted to a 9(a) agreement, the Court also took a very pro-worker view of the National Labor Relations Act.
The Court started its opinion by noted that the NLRA is designed to empower the “employees to freely choose their own labor representatives.” (Its hard for me to write this as I lost a case on appeal in the Third Circuit concerning an 8(f) agreement where I strongly emphasized this point.) The Court noted that Section 8(f) does not change this simply because it permits the employer to chose whether its employees are unionized or not. Accordingly, the Court recognized that an 8(f) agreement is to presumed to be an 8(f) agreement – freely terminable by the employer at its expiration – unless there is clear evidence that the employees have independently chosen to convert it into a Section 9(a) agreement.
The Court then held that “‘contract language’and the ‘intent’ of the union and company alone generally cannot overcome the Section 8(f) presumption, and certainly not when ‘the record contains strong indications that the parties had only a section 8(f) relationship.'” Instead, the record must indicate clear acts by the employees to indicate the desire to convert an agreement, such as signing authorization cards, signing a petition, or informally voting to confirm the union’s majority status.
The Court was clear that the union must present evidence of affirmative employee acts indicating majority support. In doing so, the Court invalidated the Board’s test that required only that the union offer to show evidence of support. In sum, the Court held “while an employer and a union can get together to create a Section 8(f) pre-hire agreement, only the employees, through majority choice, can confer Section 9(a) status on a union. So to rebut the presumption of Section 8(f) status, actual evidence that a majority of employees have thrown their support to the union must exist and, in Board proceedings, that evidence must be reflected in the administrative record.”
Takeaways
- Never sign a Section 8(f) agreement that contains language purporting to claim a majority of employees support the union.
- At the conclusion of an 8(f) agreement, do not merely accept a claim by a union that they have majority support.
- While 8(f) agreement can be terminated by an employer at the expiration of the term, most collective bargaining agreements have some mechanism stating how that must be done. Otherwise, the agreement automatically renews.
Wally Zimolong
Wally represents contractors (and subcontractors) and developers. His clients build and develop residential, commercial, and industrial properties nationwide. Wally enjoys working with the owners of the businesses he represents because they tend to be entrepreneurs and all around interesting people.
