The NLRB’s General Counsel’s office has aggressively taken on arbitration in the past year.   But, in a little-noticed case, the full Board had the opportunity to adopt the GC’s position on post-arbitration deferral and declined to do so.

Some background — about a year ago, the GC’s office announced a change in how it viewed post-arbitration deferral cases.   Under the old standards, the Board would defer to an arbitration award and consider that it resolved both contractual and unfair labor practice issues, so long as the arbitrator was “presented with the facts relevant to resolving the unfair labor practice charge” and the contractual and statutory issues were “factually parallel.”  The Board would  disturb an arbitrator’s award only if it was “palably wrong” — that is, if the arbitrator’s decision is not suspectible to an interpretation consistent with the Act.

The GC wanted a wholesale overhaul of this approach.  In its place, the GC urged a new process whereby the party urging deferral should have the burden of demonstrating that the:

(1) contract had the statutory right incorporated in it or that the parties presented the statutory issue to the arbitrator;

(2) that the arbitrator correctly enunciated the applicable statutory principle and applied it in deciding the issue.

If the party urging deferral makes that showing, the Board would then defer unless the award if “palably wrong.”

Mark Theodore from Labor Relations Update has an excellent summary on why this proposal was more bad news for employers.   In essence, arbitration is supposed to be an easy, low-cost way for employers and unions to resolve their differences.   This change by the GC would have made arbitration much more complicated.  Perhaps even more importantly, it could have given unions two bites at the apple — an initial arbitration hearing, but, then, a possible second chance at a Board proceeding if the employer could not meet the deferral standards.

Which brings us to IAP World Services, 358 NLRB 10 (2012).   This was a classic 8 (a)(3) case where the employee was disciplined for a few different issues, but ultimately terminated because he interrupted a company safety meeting to complain about backpay under the contract.   The employee filed a 8 (a)(3) charge.  The arbitrator considered whether the employee was terminated for “just cause” under the contract as well as the 8 (a)(3) issue and found in favor of the employer.   The GC’s office got involved in the case and specifically urged that its new post-arbitration deferral standard be adopted.  And the NLRB said ….. No.  Sort of anyway.

In footnote 1 to the case, the Board finds that:

The Acting General Counsel requests that the Board adopt a new framework for considering post-arbitration deferral cases. Because, in our view, the proposed framework would not lead to a different result in this case, we decline to consider that request at this time.

So, while the door remains open, the Board did not take the bait on this case.   It’s possible that maybe the Board is just waiting for a better fact pattern — or it’s possible that given the wars that the NLRB is fighting with Congress lately, this was simply one battle the NLRB does not want to pick anymore.   But it’s an important update in the battle over post-arbitration deferral.

As an aside, one wonders how this type of arbitrator decision squares with the Board’s current line of social media cases where it seems employees can say practically anything they want about the terms and conditions of employment and be protected under the NLRA.   In contrast, it seems, the arbitrator here used good judgment in finding that while the employee’s question was “appropriate,” his demeanor  in interrupting the safety meeting was “disruptive,” “disrespectful,” and “argumentative” and ultimately not protected by the Act.