Interview With Former NLRB Chairman Marvin Kaplan
Does the NLRA's bargaining process actually work or should it be changed?
Yesterday, the Senate HELP committee had a hearing on the question of labor law reform. One of the major topics of the hearing was whether the bargaining process that occurs under the National Labor Relations Act is working well and, if not, how it should be reformed. The Faster Labor Contracts Act is one piece of legislation that would reform that process by giving unions and employers the right to have an arbitrator establish the terms of a first contract.
Former NLRB Chairman Marvin Kaplan testified at that hearing and I interviewed him about his views on the topic. The audio of the interview, a brief summary of the interview, and a full transcript of the interview is below.
This interview covers the following topics:
NLRB Operations During Quorumless Period
Kaplan discusses how he and David Prouty continued working on cases after the NLRB lost its quorum following Gwen Wilcox’s termination by President Trump.
They prepared materials and drafted opinions (both joint and separate where they disagreed) to expedite case processing once the quorum was restored.
Kaplan expressed concern about whether their work would be utilized by future Board members.
First Contract Bargaining Process
The current system: After union certification, there’s a one-year protection period (certification or recognition bar) during which the union’s status can’t be challenged.
Kaplan notes that approximately 70% of first contract negotiations result in agreements within three years, while 30% don’t.
He argues that bargaining complexity, number of issues, party experience, and bargaining history all affect negotiation timelines.
The Faster Labor Contracts Act
The proposed legislation would create a system where negotiations that don’t reach agreement within 120 days could go to arbitration.
Arbitration would involve each party choosing one arbitrator, with a third chosen jointly or appointed by the Federal Mediation and Conciliation Service (FMCS).
Kaplan expresses concern that third-party arbitrators lack the intimate knowledge needed to create effective collective bargaining agreements.
Debate on Labor Law Reform
Bruenig suggests the Act might only affect the “bad” 30% of cases where employers engage in delay tactics.
Kaplan counters that parties may prematurely resort to arbitration rather than continuing negotiations that might eventually succeed.
They discuss the challenges of setting arbitrary time limits in labor law, with Kaplan questioning whether a 30% “failure” rate justifies restructuring the system.
Alternative Reform Approaches
Bruenig raises the possibility of allowing secondary boycotts during first contract bargaining.
Kaplan expresses hesitation about penalizing third parties uninvolved in the labor dispute.
They briefly discuss the Amazon Staten Island warehouse case, with Kaplan noting it was improperly highlighted during his congressional testimony as it involves election objections, not bargaining issues.
Transcript
Bruenig: So, you were the NRB chair when Gwen Wilcox was terminated by President Trump, which brought the board below a quorum, and you remained the NRB chair without a quorum for months after that. I know there have been some quorumless boards before, but the prior ones, they sort of didn’t know they lacked a quorum or didn’t know that they couldn’t do certain things or at least it was sort of up in the air while they were there. So what I’m wondering is what did you do? What did a work day look like for you?
Kaplan: So David Prouty and I pretty quickly after we lost the quorum had a long conversation about let’s try and keep things going even though we don’t have a quorum. So to do that, what we did was we continued to work on cases as if we had a quorum, trying to get them as close to the finish line as we possibly could. So when we got another member and reconstituted the quorum, they would have all the materials right in front of them ready to look at. And in some cases that was dueling opinions where we couldn’t agree. And in other cases where we could agree, it would be an opinion that the two of us could agree on. And then the hope was if we had a member join while we were still there, we could quickly issue those cases.
Bruenig: I see. Okay. So, there was work to do.
Kaplan: Oh, yes. And I’m praying that someone looks at all the work we did that I did because who knows, right?
Bruenig: Yeah. It could just get lit on fire.
Kaplan: Yes. Exactly. It could just end up in the shredder and I would be like, “Oh, that was a lot of life wasted for nothing.” So, yesterday, and I think that’s the other part, too. I was going to say that the hope is because a lot of that material has been done and put into a form, hopefully it is easily accessible and understood that there’s some cases that can get out the door quickly. Even though I’m not even there anymore, hopefully they’ll be able to look at that stuff and say, “Yeah, Marvin was absolutely right or he was totally crazy or Dave was right or totally crazy, but at the end of the day, there’s materials there to get it out quick because the backlog is growing unfortunately.”
Bruenig: So, you were testifying yesterday about the Faster Labor Contracts Act and I watched some of the hearing and it went in a number of other directions as well. But the Faster Labor Contracts Act, if it were passed, would make changes to the way first contract bargaining works after a new union is established. So could you briefly explain the way that first contract bargaining currently works and then explain how it would work under the rules of the Faster Labor Contracts Act?
Kaplan: So to clarify, I was really there to testify regarding the current system. So I’m happy to go over that in length. With regards to the Faster Labor Contracts Act, I can give you a sort of a general understanding of what it does. But I’m not as versed in it to give you a concrete play-by-play. But the way the current system works is you get certified or recognized. The union gets certified or recognized. They then have the benefit of a bar, a recognition or a certification bar, which protects them from challenges to their majority status for a year. So then it goes to bargaining and the board waits to see if there’s any issues with regards to the bargaining, bad faith bargaining, etc. The board will take unfair labor practice charges concerning bargaining and determine whether the employer or the union has bargained in bad faith and then they will direct them to bargain in good faith, issue bargaining orders which require them to bargain or broader bargaining orders which require them to bargain across multiple units and then the parties bargain. I mean, it really leaves it to the parties to determine what they want. And there’s a debate on what the information says. But in 70% of cases, there’s a collective bargaining agreement in three years. 30% of cases there aren’t.
According to a lot of these studies, that’s a debate on whether that is a failure of the system or not. I look at it a little bit differently in the sense that bargaining is complicated. It covers a lot of issues. The length of time it takes to reach an agreement depends on a lot of things: the number of issues, the complexity of the issues, the experience of the parties, the bargaining history, etc. So things take time. As I said during the hearing, experience suggests that there’s many reasons why you may not be able to get a first contract and certainly there are times that parties don’t make it the first contract that have nothing to do with CBAs. So, I think it needs to be considered in that backdrop. Is 30% really the dire number that we’re suggesting or is it a recognition that the process is working and it’s complicated? The Faster Labor Contracts Act basically creates a system through which if you fail to reach an agreement in about 120 days, it goes to arbitration, and then you can choose the arbitrators. The union chooses one, the employer chooses the other and then the third is agreed upon. But if you can’t agree upon the third, the FMCS assigns a third arbitrator that will at some point set the terms and conditions of employment.
The problem with that is, in contrast to the way it works now under the NLRA is that right now you’re picking your representative. The employees are picking their representative to represent them at the bargaining table. They’re in the best position to receive information from the employees to determine what terms and conditions are important to them. It’s the same thing with the employer. The employer is in the best circumstances to determine what it can agree to and what it can afford and what will work for the business. Right? So in this circumstance where you have a third party making the decisions, I’m not confident that you have that same level of knowledge that is necessary to make a working and effective collective bargaining agreement. So what you end up with is something in between. And that I think is where this becomes complicated. And where I think most have expressed serious concern. I will say there’s been a number of other concerns raised, which is government dictating the terms of a contract being inconsistent with constitutional provisions, including I’ve heard people say the takings clause, if there’s any kind of notice posting requirement, and freedom of speech, if there’s any limitation on employer or employee speech.
Bruenig: Okay. Let me offer an alternative analysis and then get your response. So let’s start with the idea that 70% of the first contract bargainings go well. Obviously many will contest that and say three years is way too long to be considered success, but let’s say it’s 70% are good and then 30% are bad. And the way the bad ones go is the employer will delay, delay, delay, bad faith bargain, surface bargain, reach for impasse, try to get to the decertification, that’s the usual path there. Okay, so we got the good bucket and the bad bucket. And under the Faster Labor Contracts Act, no one has to go to arbitration or mediation. It’s a choice, right? It’s an option of either party after the 120 days. So if things are going well, if you’re in that 70% bucket, presumably they’ll just keep hashing it out. Just as you pointed out, they’ll say we don’t want some stranger who doesn’t even know our situation, our business, our work – we don’t want them imposing on us and our negotiations are going well. So, we just won’t, we won’t use that option. But then for the 30% that are going badly, now they have an option. And so, really, we should almost kind of ignore all the good bargaining that occurs, that’s unaffected, and only ask ourselves whether the bad bargaining would be better with this time limit and the threat of arbitration looming.
Kaplan: I think where your premise fails is that you’re suggesting that you have perfect knowledge on both sides about bargaining. So your suggestion is that you know for a fact that you’re not going to get to an agreement rather than try and come to an agreement through additional offers. If it was an impasse situation, I would agree with you. Every party now knows that they’re not going to reach an agreement and the employer is going to implement their last best final offer. But I would say the nuance in bargaining is harder to discern and less clear. So it might be that agreements are made later, or neither party has a clear understanding of what’s going to move the other one. And the unfortunate part would be if you maybe would have come to an agreement two years later, but instead, because of whatever factors, you’ve decided that it would just be easier to go to interest arbitration. And then that frustrates the possibility of coming to an agreement perhaps because you want it in one year rather than waiting two years or three years even for an agreement that you could have reached. So it’s not as simple as just, well, yes, when it works, it works so they wouldn’t do it then. It works when it works, but you don’t know it’s going to work until it actually works, and there’s incentive to perhaps go to arbitration prematurely, rather than letting the current process work its way out.
Bruenig: Sure. So, there’s an error rate would be one way to view it, right? But it seems like we have a lot of hard time limits in the law where we know obviously it’s an arbitrary line and it introduces certain errors, right?
Kaplan: So what hard dates would you suggest?
Bruenig: Well, just to give examples in other cases: we have a 6-month time limit for filing ULP charges.
Kaplan: Yeah, but that’s to make sure that the board gets the information and can deal with the unfair labor practice. It’s not an understanding that 6 months is the appropriate amount of time to determine whether a ULP has occurred or not. I mean you file the charge and then it can take years to investigate it.
Bruenig: Even things like the contract bar, certification bar, recognition bar.
Kaplan: Okay. So, contract bar is a board creation and has been an issue of debate. I upheld the contract bar but not everyone agrees the contract bar is a good thing. Certification bar, that’s a recognition of and as I said yesterday, that was raised as well when one of the questions was, well, if we change a certification bar, what would be the right amount of time? And I will say similarly to what we’re talking about now, my response was I don’t know that it’s as simple as a one-size-fits-all. When the Board created the certification bar, clearly they thought one year was probably sufficient for labor stability after an election, but that might not be the case anymore, nor is it clear that that’s the only or the right amount of time. So I guess I would say I’m not sure. I guess I would disagree with the premise.
Bruenig: So let’s use the certification bar because I think a lot of the points you’re raising about it are the same points you might raise over the Faster Labor Contracts Act, right? Where one-size-fits-all on the certification bar is kind of arbitrary, right? Why 12 months? Why not 11 months, 10 months, 13? It could be whatever. But there’s value in saying, look, I know wherever I draw this line, on the other side of it, there’s going to be mistakes there, that we should have let it go longer or it should have been shorter, whatever, but let’s have a hard line. So, the way you would apply that argument for the Faster Labor Contracts Act is you would say, look, if you give people an option at 120 days to go to arbitration, some people are going to use that option incorrectly. They’re going to make a mistake. They should have waited, and 30 days later, they would have had their own CBA. It would have been better than what the arbitrator came up with. So there’s an error rate, but we tolerate the error rate because maybe the benefits of having a clear line outweigh the costs, and maybe it puts pressure on everyone to participate in a good faith way because people want to avoid the arbitration. So I guess what I am asking is that just because there is an error rate, does that necessarily mean that those errors outweigh the good that potentially comes from having that kind of line?
Kaplan: That’s the decision that the lawmakers are going to have to make. Is 30% sufficient to justify a restructuring of the system? And I think 30% is far below in my opinion what is sufficient to suggest that the system doesn’t work or the existing system doesn’t work.
Bruenig: What would you think about going maybe the other way with it? How could we change up first contract bargaining that doesn’t involve a third party? I can see where people would say that is categorically bothersome to me. What about freedom of contract? Etc. So, What if we made it to where some of the rules about what unions could do and maybe employers as well, though I haven’t really thought about on the employer side, we change them up during the first contract bargaining session? So, the one I think about would be secondary boycotts or solidarity strikes? What if we said, look, during first contract bargaining, if someone wants to do a secondary boycott to assist you with that, that won’t be illegal anymore? I don’t know if we make it protected or whatever, but you couldn’t take action against that. What would you think about that?
Kaplan: Well, if you didn’t take action against it, it would be protected theoretically. I don’t know. I’d have to think about that. I think that I would remind you the problem, the concern with those secondary activities is that they hurt parties that are not a party to this process, right? And who really have no ability to change anything, right? They have no control over the terms and conditions or anything like that. So I’d have to think about that. I don’t know. I know a lot of people have thrown out changes and remedies, and things like that. And I do think it’s a good idea to be thinking about this beyond just what has been offered, if there’s a better way to do this. But I’m just not sure. I’d have to think about that a little bit more.This comes from me, a former chairman, worked at the board a very long time, my experience is that the system works as it exists now. More than that, I’d have to spend a lot of time thinking about what kind of remedies would make sense and what are consistent with public policy especially in a neutral type situation.
Bruenig: I wonder what is your theory about why the bill was introduced? Presumably, the labor movement—some people obviously think it doesn’t work. So much so that they got a bill introduced. A Republican introduced it. That’s unusual.
Kaplan: Well, I suspect it’s a number of factors. I suspect certainly the 30% that aren’t getting their contract in 3 years are probably frustrated. And I suspect that some people are frustrated with the speed it takes with the board to issue a decision and to order people back to bargain in the event that there is a ULP. And I think both are probably reasonable responses, but frustration on anecdotal concerns is not a reason to change policy. And bad facts, we say this all the time in law, bad facts don’t make good law. And again, I would say yesterday there was a very strange focus on a case that Amazon had in Staten Island with regards to their warehouse workers, and I was on that case. That’s not even a bargaining issue case. That is a question as to the conduct of the union during the election and what Amazon is challenging there is the conduct of the election that led to the certification. They haven’t even been certified. There’s still a question about whether the election was appropriate. They haven’t even gotten to the point where bargaining would be going on, and frankly Amazon can’t bargain or it loses its ability to challenge the election. So it was the focus of the hearing on multiple fronts. But that’s not even the right case. So, if that’s the one you choose to highlight, you’ve missed the mark. I mean, to your point about, well, some people are frustrated. Yes. And they’re frustrated in highlighting a case that actually isn’t particularly relevant to the discussion at hand.
Bruenig: That’s fair enough. But the use of election objections to maybe delay and draw things out is a thing that happens. I mean, I’m a practitioner, so I’ll say I had a recent case where the union won 37 to zero and we got a Harborside election objection, and there was no way that would succeed. We won the case, but we lost 3 months winning that.
Kaplan: But you did win.
Bruenig: We did win.
Kaplan: Yeah, and that would be the point I would make is that you won, right? And now you’re bargaining. And I guess that’s my point: yes, there are delays. There are delays inherent anytime you seek a government’s intervention in these things. But again, the question is, are they so egregious? And I would say this, the lack of a quorum, if they really want to get this working, put a quorum in place and then your cases will move again.