Court strikes down NLRB’s strongest union bargaining-order tool

When management learned that the Teamsters likely held authorization cards from 50 to 60 percent of employees, internal emails revealed the alarm. Executives moved quickly to put together a compensation package that would blunt the campaign’s momentum. Despite having told workers that no further raises were coming until the next fiscal year, the company reversed course and announced a $4-per-hour across-the-board increase – the first time Woodford Reserve employees had ever received two across-the-board wage increases in the same year. Management also expanded its pay-progression policy to cover newly hired and recently promoted workers, loosened vacation restrictions around the December holidays, and – a week before the vote – handed out bottles of bourbon. 

The strategy worked as intended. Employees who had signed authorization cards began pulling back. One asked for his card back. Another told union representatives the extra money had changed his mind. On election day, the union lost 45 to 14. 

The NLRB found that Brown-Forman had committed unfair labor practices under Section 8(a)(1) and (3) of the National Labor Relations Act by making, announcing, and implementing the wage increases, benefit changes, and bourbon gifts to discourage union membership. The Board set aside the election and ordered the company to recognize and bargain with the Teamsters, relying exclusively on the Cemex standard it had adopted in August 2023. 

The Sixth Circuit agreed that the evidence of unfair labor practices was solid. The court found the timing, the internal emails, and the unprecedented nature of the compensation changes all pointed to a deliberate effort to undermine the organizing campaign. The well-timed benefits, the court observed, amounted to a velvet glove concealing coercion, interference, and discouragement. 

But the court drew the line at the remedy. The Cemex standard had replaced the Gissel framework that had governed bargaining orders for more than 50 years. Under Gissel, the Board had to evaluate whether a fair rerun election was still possible before forcing an employer to bargain. Under Cemex, the Board could skip that analysis and default to a bargaining order whenever it determined that an employer’s misconduct warranted setting aside an election.