The Big 3’s Layoff Power During Auto Workers Strike: Explained

Layoffs have begun in response to the United Auto Workers’ selective strike at a handful of Big 3 facilities, revealing the intricacies of employer power and labor rights during the high-stakes discussions for new labor deals.

Ford Motor Co. temporarily sent packing about 600 non-striking workers at a plant in Michigan, and General Motors Co. has warned it could lay off 2,000 non-striking workers at a Kansas City, Kan., location. Each company cited internal supply chain issues due to a lack of parts needed for certain assembly workers to do their jobs.

But the legality of the layoffs—and future automaker actions that could sideline union workers— turns on a host of factors, such as which employees are put out of work, how the contracts define employer power, and the companies’ justifications for their moves affecting the workforce.

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Can the companies lay off non-striking workers?

The UAW is striking because it couldn’t reach deals with Ford, GM, and Stellantis NV before their respective collective bargaining agreements expired last week. But almost all the terms of the expired contracts remain in effect while the parties bargain, with a few crucial exceptions, most notably the no-strike clauses.

Ford’s expired deal with the UAW, for example, appears to give the company some authority to lay off workers. But that power could be limited, to the extent that it derives from the contract’s management-rights clause. That kind of provision, which reserves to the employer the right to take unilateral action over certain subjects, is also among the few types of clauses that don’t survive the expiration of the CBA.

But even more critical is the truth of the automakers’ justification for the layoffs. If the strike robbed certain assembly workers of the parts necessary to do their jobs, then the layoffs are probably justified. But if that explanation is just a pretext for a bid to punish workers for the strike, then it would run afoul of federal labor law.

What about federal law on mass layoffs?

The Worker Adjustment and Retraining Notification Act—commonly known as the WARN Act—requires employers to provide at least 60 days’ notice to workers before a plant closure or mass layoff. Employers that violate the law can be liable for back pay, benefits, and a civil penalty of $500 per day.

The closure or layoff, however, must last at least six months to trigger any WARN Act obligations.

The WARN Act exempts striking workers, excusing an employer of its duty to give notice when replacing workers on an economic strike. Workers striking to obtain higher wages or other economic concessions have fewer job protections than those who strike to protest unfair labor practices committed by their employers.

So the automakers can lay off striking workers?

Not exactly, but the automakers can permanently replace workers out on an economic strike, unless the UAW can show they were motivated by an independent unlawful purpose. Those replacements have a right to continue working when the strike ends, while the former strikers would have to wait on a recall list.

But deals to resolve strikes often require the discharge of permanent replacements so the union workers can return to their jobs when the stoppage closes.

National Labor Relations Board General Counsel Jennifer Abruzzo is seeking to overturn the board precedent allowing for permanent strike replacements, but that legal change is unlikely to happen in time to help the UAW, if it happens at all.

What about lockouts?

The UAW’s strategy of selectively striking at certain Big Three plants creates the possibility that the automakers could punch back by locking out union workers at other facilities.

The Supreme Court has ruled that employers can lock out workers to pressure them in support of a legitimate economic position. Although they can’t be permanently replaced, NLRB precedent permits the temporary replacement of locked out workers.

Abruzzo has also targeted precedent on lockout replacements, but as with board law on strike replacements, any action would most likely come too late to impact the UAW-Big Three labor dispute.

To learn more:

• UAW’s Strike Strategy to Benefit From Pro-Worker Labor Board (1)
• Automakers, UAW Spend Strike’s First Day in War of Words (2)
• UAW’s Bid to Upend the Auto World Began With a Snub of Bill Ford (1)
• Hiring Replacements in Lockouts Is NLRB Top Lawyer’s Next Target