NLRB Rules Construction Contractor Still Signatory to Union Agreement Where It Failed to Timely Terminate Multiemployer Association Relationship

In Carr Finishing Specialist, Inc., 358 NLRB No. 165 (9/28/12), the NLRB ruled that a contractor that was signatory to an Collective Bargaining Agreement with the Iron Workers Union remained bound to a newly-negotiated agreement when the company did not timely revoke the authority it gave to multiemployer bargaining association to negotiate on its behalf.

The contractor signed a membership application with a multiemployer association in 1997 which bound the company to the agreements negotiated between the association and the union, and which required the company to give notice of its resignation from the association at least 90 days before the expiration of any union agreement to which the company became bound. The contractor became signatory through this process to a union agreement that ran from May 1, 2006 to April 30, 2009.   The contractor did not give notice to the association that it was revoking its bargaining authority until February 17, 2009, less than 90 days before contract expiration date.  The NLRB held that this prevented the contractor from timely withdrawing from the association, and that the company was bound to a new agreement negotiated between the union and the association in 2009, regardless of the time limitations contained in the union agreement for effectively termination.

Construction contractors that are signatory to Section 8(f) agreements must pay particular attention to this case.  The decision illustrates the importance of precisely proceeding according to the terms of the applicable collective bargaining agreements and any applicable association agreements for notice of termination to be effective.

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