03/09/2026: Sixth Circuit Rejects Cemex Bargaining Orders
Court ruled that using adjudication to establish Cemex rule was improper.
Brown-Forman Corp. V. NLRB, 25-1060, (Sixth Circuit)
The Sixth Circuit ruled 2-1 in Brown-Forman Corp. v. NLRB (March 6, 2026) that the Board’s Cemex bargaining order standard was invalidly created through adjudication, granting the employer’s petition for review and remanding.
Background and Unfair Labor Practices
When workers at Brown-Forman’s Woodford Reserve distillery in Versailles, Kentucky began organizing with the Teamsters in 2022, the company responded with a $4-per-hour across-the-board raise — the first time it had given employees two across-the-board increases in a single year — along with expanded pay progression benefits and, one week before the election, bottles of bourbon. The union lost 45-14. The Board upheld the ALJ’s finding that these actions violated NLRA Section 8(a)(1) and (3) as coercive benefits timed to undermine organizing, relying in part on NLRB v. Exchange Parts Co., which prohibits “well-timed” benefits conferred with the purpose of chilling union support. The court affirmed those findings under substantial evidence review, also rejecting the employer’s argument that pre-petition conduct was off-limits, since the wage increase was part of a continuing course of coercive conduct that extended into the post-petition period.
The Gissel Framework
The Court majority began by explaining the Gissel Packing framework that Cemex purported to supplement or replace. According to the Court, under Gissel, bargaining orders were treated as a last resort — an extraordinary remedy available only when the Board made an affirmative, case-specific finding that a fair rerun election was unlikely. Gissel identified three categories of employer conduct. Category I involved outrageous and pervasive unfair labor practices so severe that a bargaining order was the only available remedy. Category II — the more commonly invoked category — covered less pervasive practices that nonetheless undermined majority strength and impeded the election process; here, the Board had to find that the possibility of a fair rerun election, “though present, is slight.” Category III covered minor violations with minimal electoral impact, which could never sustain a bargaining order. The defining feature of the Gissel framework, in the majority’s view, was its forward-looking inquiry: the Board was required to evaluate whether a fair election could still be held going forward, not merely whether the prior election had been tainted.
The Cemex Standard and Its Invalidation
In this case, the Board issued a bargaining order based solely on Cemex Construction Materials Pacific, LLC (2023), which the majority described as making a “fundamentally different” analytical move. Rather than asking whether a fair future election remained possible, Cemex asked only whether the prior election should be set aside. If the answer to that backward-looking question was yes, a bargaining order issued automatically — the Board no longer needed to evaluate the prospect of a clean rerun. The majority characterized this as transforming bargaining orders from an exceptional remedy into a default one.
The majority also emphasized a structural feature of the Cemex opinion that it found telling: the Cemex Board had actually applied Gissel to resolve the case before it, concluded that Gissel provided an adequate basis for a bargaining order, and only then — in a separate section of the opinion — announced its new standard. Because the Cemex Board had already resolved the dispute under Gissel, the new standard added nothing to that particular case. The only work it could do was prospective, deterring future employer misconduct in other cases. That, in the majority’s view, exposed Cemex as rulemaking in disguise.
The majority further took issue with Cemex‘s framing of its purpose around general deterrence. Gissel had discussed deterrence in the narrow sense of preventing a specific respondent from continuing or repeating its own violations. The majority read Cemex as having repurposed that rationale into something far broader — a justification for a generally applicable policy designed to discourage future conduct by employers who were not parties to the Cemex adjudication at all. The Board’s adjudicatory authority, the court held, does not extend that far. Deterrence of hypothetical future violations by non-parties is a function of rulemaking under 29 U.S.C. § 156, not adjudication under 29 U.S.C. § 160.
Because the Board relied solely on the now-invalid Cemex standard in this case and provided no independent Gissel analysis, the bargaining order could not stand, and the court remanded for the Board to apply proper standards.
The majority explicitly declined to decide whether Cemex‘s substance was actually inconsistent with Gissel or otherwise exceeded the Board’s statutory authority, reserving that question for another day. The holding was narrow: Cemex fell not because its policy was necessarily wrong, but because the Board used the wrong procedural vehicle to announce it.
The Dissent
Judge Mathis dissented, framing the Cemex-Gissel relationship quite differently. In his reading, Cemex did not replace Gissel so much as refine it. Gissel had authorized bargaining orders when an employer’s conduct undermined election integrity; Cemex simply codified, as a matter of Board policy, that when misconduct is serious enough to void an election, the possibility of a fair rerun is by definition slight — which is precisely what Gissel Category II required the Board to find anyway. The dissent also pushed back on the majority’s rulemaking-through-adjudication theory, arguing that under NLRB v. Bell Aerospace Co., the Board has broad, court-endorsed discretion to choose between rulemaking and adjudication, and that the prospective effect of any adjudicatory holding on future cases is simply how precedent works. He further argued that Cemex bore all the hallmarks of a proper adjudication — it arose from a party’s request, applied the new standard to the employer in the same proceeding, and involved reasoned decisionmaking supported by the Board’s experience administering the NLRA.
Significant Cases Cited
NLRB v. Gissel Packing Co., 395 U.S. 575 (1969): Established the framework under which the Board may issue a bargaining order when employer misconduct makes a fair rerun election unlikely, while affirming the general preference for secret-ballot elections.
SEC v. Chenery Corp., 332 U.S. 194 (1947): Held that an agency exercising adjudicatory authority must base its decision on the particular facts of the case before it, establishing core limits on adjudicative policymaking.
NLRB v. Wyman-Gordon Co., 394 U.S. 759 (1969): Held that the Board improperly used adjudication to create a generally applicable rule not derived from the case’s specific facts, distinguishing permissible case-by-case policymaking from rulemaking through adjudication.
NLRB v. Bell Aerospace Co., 416 U.S. 267 (1974): Affirmed the Board’s discretion to choose between rulemaking and adjudication while acknowledging that reliance on adjudication could constitute an abuse of discretion in some circumstances.
NLRB v. Exchange Parts Co., 375 U.S. 405 (1964): Held that an employer violates the NLRA by conferring economic benefits on employees timed to discourage union support, even where the benefits are otherwise favorable to employees.
Woodward Inc., 13-RM-374508 (Regional Election Decision)
Woodward, Inc., a manufacturer of aerospace products, filed an RM petition seeking a new representation election after its longtime bargaining representative — the Woodward MPC Employees Representative Union (”MPC”), a small independent union certified since 1967 — voted to affiliate with the UAW in September 2025. Woodward argued that the cumulative changes accompanying the affiliation were so significant that MPC had been replaced by a materially different organization, destroying the presumption of continued majority support. Regional Director Angie Cowan Hamada dismissed the petition, finding substantial continuity between the pre- and post-affiliation union.
Legal Framework
Once a union is certified, it enjoys a presumption of continuing majority support. Affiliation with a national or international organization does not, standing alone, disturb that presumption. A question concerning representation arises in the affiliation context only if organizational changes are “sufficiently dramatic to alter the union’s identity,” effectively substituting a new organization for the previously chosen representative. Under Raymond F. Kravis Center for the Performing Arts, the Board applies a single continuity-focused standard, abandoning the former two-pronged test that also assessed the adequacy of internal voting procedures. The employer bears the burden of proving discontinuity.
To assess substantial continuity, the Board examines four factors drawn from Service America Corp.: (1) continuation of leadership; (2) perpetuation of membership rights and duties; (3) continuation of contract negotiations, administration, and grievance processing; and (4) preservation of physical facilities, books, and assets. The analysis is qualitative, not mechanical, and gives paramount effect to employees’ desires.
Leadership
The Regional Director found substantial continuity of leadership. MPC’s elected President and Vice President retained their positions post-affiliation, and the majority of the steward body continued to serve. Only the Chief Steward stepped down. While the executive board expanded from five to nine positions, vacancies are to be filled through democratic elections limited to Local members — not outsiders. The Director rejected Woodward’s argument that the Local President’s authority was diminished, citing Central Washington Hospital and RCN Corp. for the proposition that the Board evaluates actual practice, not theoretical authority. Reserved or “paper” authority held by the UAW International — including oversight of finances and strike sanctioning — does not establish discontinuity absent evidence of regular exercise.
Membership Rights and Dues
All current MPC members transferred into UAW Local __ without initiation fees. Although new members will be subject to initiation fees, the Board treats fees applicable only to future members as immaterial. The dues structure will shift from a flat $2 weekly rate to a graduated system eventually reaching 2.5 hours of wages per month — a change the Director characterized as a foreseeable and ordinary consequence of affiliation. The Director rejected Woodward’s argument that other UAW constitutional provisions (governing membership eligibility and internal governance) materially altered members’ rights, finding no evidence those provisions had been enforced against current members.
Contract Negotiations, Grievance Processing, and Strike Authorization
Local President Tapia continued to serve as chief spokesperson in bargaining, and the composition of the bargaining committee was unchanged. UAW Representative Joe Morel attended sessions post-affiliation but in a limited, supportive role. The Director found no evidence the International had exercised reserved contract-approval authority or directed bargaining strategy. Grievances continued to be initiated and processed by Local officers and stewards as before. The International’s reserved right to approve strikes likewise did not establish discontinuity, as the Local membership retains the right to vote on strike authorization and no evidence showed the International had exercised that authority.
Physical Facilities and Assets
The Local continues to use the same facilities, bank accounts, and records as before affiliation. The Director distinguished the facts from Western Commercial Transport, where assets had been placed entirely beyond local membership control, finding no comparable evidence here. The diversion of a portion of dues to the International was characterized as a normal consequence of affiliation.
Waiver
The Union separately argued that Woodward waived its right to challenge the affiliation by continuing to bargain after learning of the vote. The Director declined to find waiver, noting that only a few weeks had elapsed between the affiliation vote and the filing of the RM petition, and that the Union had not demonstrated detrimental reliance. Waiver under Ventura County Star-Free Press requires evidence of prolonged acquiescence and detrimental reliance — neither of which was present here.
Significant Cases Cited
Raymond F. Kravis Center for the Performing Arts, 351 NLRB 143 (2007): Established the current single-prong substantial continuity standard for post-affiliation representation questions, abandoning inquiry into internal voting procedures.
NLRB v. Financial Institution Employees of America, Local 1182 (Seattle-First National Bank), 475 U.S. 192 (1986): Supreme Court case recognizing that union affiliations are natural and foreseeable aspects of collective bargaining relationships that should not unnecessarily disrupt industrial stability.
CPS Chemical Co., 324 NLRB 1018 (1997): Applied the substantial continuity factors and held that differences in size, bylaws, dues, and internal procedures resulting from affiliation do not establish discontinuity.
Sullivan Bros. Printers, Inc., 317 NLRB 561 (1995): Affirmed that the substantial continuity inquiry is qualitative rather than quantitative and emphasized that the Board intervenes in internal union affairs only in the most limited circumstances.
Minn-Dak Farmers Cooperative, 311 NLRB 942 (1993): Held that affiliation with a national organization does not alone affect a union’s representative status and that the Board’s policy strongly favors stability in bargaining relationships.