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NLRB case could have implications on union agreements with painting contractors

2 July, 2024

5

The AFL-CIO has released a position statement on a case that could have implications for painting contractors everywhere.

The case involves a painting contractor who wanted to back out of the Greater Cincinnati Painting Contractors Association before a contract was signed with the union.

The Painting Contractor LLC argued that it shouldn’t have to honor the association’s agreement with the International Union of Painters & Allied Trades District Council 6 because the company withdrew from the association before union members ratified the deal.

The painting contractor dropped their affiliation with the association in late May. A short time later on June 5, the union ratified the contract with the GCPCA.

However, the labor board found that there was a tentative agreement on May 28, when the painting contractor was still a member of the association. The labor board ruled that the painting contractor was bound to the agreement, regardless of ratification.

“Ratification by the unit employees was neither a condition explicitly agreed to by the association and union nor an express term of the third tentative agreement,” wrote the labor board. “Thus, despite the ‘tentative agreement’ terminology used by the association and union, a contract binding on the association’s member employers was formed on May 28.”

The painting company appealed to the Sixth Court. In January 2023, the Sixth Court remanded the decision to the National Labor Relations Board for a decision.

The argument for The Painting Contractor LLC is that the association had a pattern of returning to the bargaining table after the union rejected an offer.

“These facts suggest that the ratification requirement had greater legal significance than the board accorded it,” the Sixth Court wrote in the decision forwarding the appeal to the NLRB.

That brings us to June 2024. In a position statement filed last week, the AFL-CIO ruled that the contract between the association and the union didn’t need to be ratified to be valid.

“The Sixth Circuit remanded for the board to address certain facts that could be seen as inconsistent with the board’s prior finding that contractor ratification was not a condition precedent to forming a contract,” the AFL-CIO wrote in the position statement. “But, as will be shown, the facts highlighted by the Sixth Circuit are entirely consistent with the finding that the contract ratification was not a condition precedent to contract formation.”

That may sound like a bunch of legalese, but it says that the union believes companies must honor agreements even if they withdraw from the professional association before the contract is made official. Not exactly a surprise from the AFL-CIO.

The implications for your business are that you could be locked into a contract with your local painter's union even if you try to back out at the last minute.

It sounds like the painting contractor would have been within their right had they pulled out earlier before a mutual agreement was struck.

In this case, “Better late than never” doesn’t apply. For now, at least, the early bird gets out of the contract.
 

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