D.C. Circuit Voids 1-Year NLRB Successor Bar in Unionized Acquisitions
Updated
Updated · The National Law Review · Jul 28
D.C. Circuit Voids 1-Year NLRB Successor Bar in Unionized Acquisitions
3 articles · Updated · The National Law Review · Jul 28
Summary
A federal appeals court struck down the NLRB rule that forced buyers of unionized businesses to recognize and bargain with an incumbent union for up to one year after a takeover.
The D.C. Circuit said the rule conflicts with the National Labor Relations Act because it can compel bargaining with a union that no longer has majority employee support, blocking challenges by workers, employers and rival unions.
Hospital Menonita de Guayama triggered the case after acquiring a hospital in 2017, hiring a majority of predecessor employees, then receiving worker-originated evidence within five months that all five bargaining units had rejected the union.
The court granted the hospital's petition and denied enforcement of the NLRB order, giving successor employers stronger grounds to contest union status when employees themselves present reliable evidence of lost majority support.
The ruling has national reach because employers can appeal NLRB losses to the D.C. Circuit, though uncertainty remains if the decision is appealed or the board keeps applying the doctrine elsewhere.