In District Hospital Partners, L.P. d/b/a The George Washington University Hospital, et al., v. 1199 Service Employees International Union, the United States Court of Appeals, District of Columbia considered claims of bad-faith against the employer. In its final decision the court upheld the National Labor Relations Board’s prior determination the employer,  District Hospital Partners (“DHP”), had engaged in bad faith surface bargaining.

Over the course of approximately 14 months DHP maintained three main proposals that, in whole, proposed to eliminate most of the benefits of a collectively bargained employment relationship.

First, DHP maintained a management rights proposal that would allow unrestricted reassignment of unit work to others, search of employees without notice, unlimited subcontracting of unit work, discipline without cause, unilateral changes to benefits and ability to define unit work.

Second, months into the bargaining, DHP introduced a no-strike proposal while eliminating any binding arbitration, which the court found to be absent of any balance of rights

Third,  DHP proposed eliminating  binding arbitration and replacing it with non-binding mediation in disputes involving terminations which left no meaningful appeal process to challenge the employer’s disciplinary decisions.

The court found DHP’s proposals “for near total control without offering meaningful concessions” inferred an intent to frustrate agreement. The court found the employer to be in violation of the National Labor Relations Act (“NLRA”) (29 USC section 158(a)(1), (a)(5) which provides in part, that it is an unfair labor practice for employers to interfere, restrain or coerce employees  in the exercise of their rights to organize and collectively bargain, or to refuse to bargain. In reaching its conclusion, the court relied on a “totality of the circumstances” test which considered the cumulative impact on the bargaining process of several employer proposals and the employer’s bargaining practices.

The court found that while the obligation to bargain in good faith does not compel parties to reach an agreement, it does require that parties “approach the bargaining process with a genuine intent to reach agreement.” The court further found the cumulative effect of  DHP’s proposals “left employees with less rights and protections than if there was no contract at all.”

The court held that DHP’s continued maintenance of the proposals in which the employer would “retain near total control” and the union would be required to give up most of its representative functions.  The court found that when viewed cumulatively, the proposals left the union with no meaningful way for protest or enforcement and exhibited an intent to “frustrate the possibility of arriving at an agreement.”

While this case involves application of the NLRA, employers should be mindful of the  principles outlined by the court in distinguishing bad faith from hard bargaining and the requirement for meaningful engagement in the bargaining process. Minnesota public employers should be aware of this decision, as the Minnesota Public Employee Relations Board (“PERB”) may look to the NLRB for guidance on certain unfair labor practice determinations.  If you or your organization need assistance in development and implementation of bargaining practices, contact Wiley Reber Law for legal advice that works.