What Are Hot Cargo Agreements?

Hot-cargo agreements are agreements between an employer and a union where the employer agrees to not handle or work on any freight or product coming from another person with whom the union has a dispute. Section 8(e) of the National Labor Relations Act prohibits unions and employers from entering into any agreement where the employer agrees to refrain from dealing in the products of another employer or to cease doing business with another person.

Exceptions to the above exist in the construction industry for some subcontracting work and for agreements in the garment industry dealing with employers working on goods or on the premises of a manufacturer.

Employers should be mindful that if the object of the suspect clause in a collective bargaining agreement is to benefit union members generally, as distinguished from employees within the bargaining unit, the clause is unlawful. Conversely, if the object is to preserve the work of the bargaining unit or otherwise benefit unit employees, the clause is usually lawful.

For example, an employer did not violate Section 8(e) by including in its collective bargaining agreement a provision stating that employees would not handle pre-fitted doors because the object of this provision was to preserve work customarily performed by the union’s members.

However, the Board found an unlawful clause in a situation where the parties executed a “hazardous work” agreement that provided that if employees were required to make delivers to or pick ups from, or to enter a struck employer’s premises, because of the hazards involved, the contracting employer would provide the employees with additional benefits and protection.

Whether an agreement is lawful often boils down to whether the union’s objective is the preservation of work for the primary employer’s employees or if the agreement is calculated to satisfy the union’s objective elsewhere. And the difference between the two can be very thin.

Matt Austin is a Columbus, Ohio lawyer who owns Austin Legal, LLC, a boutique law firm with offices in central and northeast Ohio that limits its representation to employers dealing with labor, employment, and OSHA matters. Austin Legal’s Concierge Legal Services program is relied upon by companies to remain compliant and competitive. If you have employees, you need Concierge Legal Services. You can call Matt at (614) 285-5342 or email him at Austin@LaborEmploymentOSHA.com.

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