In Douglas Autotech Corp., 357 NLRB No. 111 (Nov. 18, 2011), a 2-1 majority of the National Labor Relations Board (“Board”) opined that a company “reemployed” illegal strikers who attempted to return to work, when the company informed these illegal strikers they were “locked out.” In Douglas Autotech Corp., the United Auto Workers Local 822 (“UAW”) represented a bargaining unit of 146 employees at Douglas Autotech’s Bronson, Michigan facility. The day after the collective bargaining agreement between the UAW and Douglas Autotech expired (after the UAW previously served its Section 8(d) notice to terminate on Douglas Autotech), the UAW members struck—without first filing any notice of dispute with the Federal Mediation and Conciliation Services (“FMCS”) and any pertinent state mediation agency (the UAW could not legally strike until it first filed the FMCS notice, at least thirty days in advance of the expiration of the collective bargaining agreement).

Significantly, according to Section 8(d) of the National Labor Relations Act (“NLRA”):

Any employee who engages in a strike within any notice period specified in this subsection…[the thirty-day waiting period, referenced above] shall lose his status as an employee of the employer…but such loss of status for such employee shall terminate if and when he is reemployed by such employer.

After the UAW realized its error (neglecting to file the required notice of dispute)—and that its strike was illegal—it instructed bargaining unit members to immediately approach Douglas Autotech with unconditional offers to return to work. In response, Douglas Autotech elected to “lock out” these strikers—to afford it an opportunity to confirm that the UAW’s strike was indeed illegal (which it later did confirm). Three months later, after negotiations for a new settlement failed, Douglas Autotech declared all 146 bargaining unit members discharged as a consequence of the illegal strike.

Divided along partisan lines, the Board majority concluded that Douglas Autotech, by “locking out” the strikers without expressly reserving the right to designate their employment as forfeited, “reemployed” them; according to the Board majority, only employees can be locked out. Member Hayes, the lone dissenter, opined that because the strikers engaged in an illegal strike, they became unemployed until Douglas Autotech decided to return them to active status or committed in an agreement to rehire them—neither of which Douglas Autotech did in this case.

Take Away

An employer must ensure that the party who initiates the contract reopener (expressing its intent to terminate or modify the collective bargaining agreement) pursuant to Section 8(d) of the NLRA (either the union or employer is responsible for notifying the FMCS and pertinent state agency—whichever party initiates the reopener) provides proper notice of dispute to the FMCS and pertinent state agency. As this case illustrates, when a union initiates the contract reopener but fails to properly notify the FMCS, and strikes illegally, its bargaining unit members become unemployed and an employer may discharge these illegal strikers. However, this case also illustrates that absent a regime change within the Board, “lock outs” of illegal strikers—at least where an employer fails to expressly reserve its right to designate the strikers’ employment status as forfeited—likely renders the strikers “reemployed” and protected by the provisions of the NLRA.

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