In 2023, the NLRB issued its infamous, extremely pro-labor decision in Cemex Construction Materials Pacific, LLC, 372 NLRB No. 130, 2023 WL 5506930. By that edict, the Board was now requiring employers to file an RM petition upon receipt of a union representation demand and claim of majority support.
Of course, the employer had the option simply to recognize the union. Much more importantly, the Cemex Board held that, going forward, an employer committing serious unfair labor practice violations would be ordered to bargain with the union. In the past, the normal order would be to schedule an election or re-run election as the case might be. For the past 50+ years, a bargaining order was to be issued only in the most extreme cases. (See NLRB v. Gissel Packing Co., 395 U.S. 575 (1969))
On March 6, 2026, the US Court of Appeals for the Sixth Circuit had the opportunity to review the Board’s Cemex decision in Brown-Forman Corp. v. NLRB, Nos. 24-2107/25-1060. In that latter case, an NLRB Administrative Law Judge (“ALJ”) determined that Brown-Forman had committed a number of unfair labor practices that interfered with its employees’ efforts to unionize.
Specifically, the ALJ found that Brown-Forman, d/b/a Woodford Reserve Distillery, had unlawfully 1) announced and implemented a $4/hour across-the-board wage increase; 2) announced the modification of employee benefits; and 3) gifted employees a bottle of bourbon. Accordingly, the ALJ recommended a bargaining order based on Cemex and Gissel Packing.
Upon review, the NLRB did issue a bargaining order but relied solely on Cemex. That point was deemed crucial by the Sixth Circuit, giving the Court the first opportunity to determine whether the Board’s new standard could serve as the basis for a bargaining order.
The Court correctly noted that the Board could in effect create new law in either of two separate ways: 1) rulemaking in accordance with the federal Administrative Procedure Act or 2) adjudication. The Court found that the Cemex standard was formulated through an improper use of the Board’s adjudicatory authority and, thus, was invalid. In so doing, the Court noted:
The substance of the Cemex standard reflects a significant shift from the Gissel standard. While the Gissel standard instructs the Board (and reviewing courts) to order an election when a fair one is possible—staying true to the preferred method of effectuating Congress’s ultimate goal of preserving employees’ preferences—the Cemex standard looks only at whether a previous election was not fair. Under Cemex, the Board no longer evaluates whether it could still use an election to measure contemporaneous employee sentiment regarding unionization.
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But we do not reach the substance of the Cemex standard in this case because the Board announced this significant policy change via an adjudication, and it did so without respecting the bounds of its adjudicatory authority.
(Slip op. at 11-12, emphasis supplied).
The Court held that the Board, when adjudicating, could devise a remedy for the case before it, something the Board did not do in the underlying case involving Cemex. Rather, the Board created a “hard and fast” rule going forward—which the Court held could only be done via rulemaking.
Further, the Court opined that “the Board can only articulate through adjudication policies that are crafted to resolve the parties’ particular dispute.” (Slip op. at 17, emphasis supplied). Perhaps most damning, the Court noted that the Cemex Board “made it clear that its new standard was not remedial in nature—contravening the essence of its adjudicatory authority.” (Slip op. at 23, emphasis supplied).
The Court remanded the Brown-Forman case to the Board for further proceedings consistent with the Court’s opinion. The underlying NLRB decision was issued by the Biden Board. On remand, it will be the Trump Board deciding the case. It is quite possible that the new decision will call for a re-run election rather than a bargaining order.
If you have any further questions regarding labor relations and labor law, please contact Philip Mortensen.
Philip S. Mortensen