Rieth-Riley: The Sixth Circuit’s Roadmap on Multiemployer Withdrawal, Lockouts, and ULP Strikes

The Sixth Circuit denied Rieth-Riley Construction Co.’s petition for review and enforced the NLRB’s order requiring the Indiana-based contractor to bargain in good faith with Local 324, IUOE — capping a nearly decade-long dispute and producing a useful set of black-letter lessons for any employer facing multiemployer bargaining issues.

The dispute started in 2018 when Local 324 decided to withdraw from a multiemployer bargaining group through the Michigan Infrastructure and Transportation Association. The union wanted to negotiate directly with each employer, including Rieth-Riley. Rieth-Riley refused and pushed back into multiemployer bargaining. The dispute escalated through a lockout, unilateral wage actions, and ultimately a 2019 strike.

The Sixth Circuit affirmed the Board on essentially every point.

1. Union withdrawal from multiemployer bargaining was timely (either side can withdraw before negotiations commence). No real bargaining had begun when the union withdrew, so the withdrawal was lawful.

2. The lockout was unlawful. Locking out workers to compel them back into group bargaining crossed a line. The scope of a bargaining unit is not something either side can force on the other.

3. Unilateral wage actions violated the NLRA. Rieth-Riley granted a $2/hour retroactive raise without notifying the union. When the company later realized it still had to contribute to benefit funds, it clawed back the increase from employee paychecks on four days’ notice. The court rejected the company’s economic-exigency defense. A second 2020 unilateral $1/hour wage increase also violated the Act. The company’s argument that federal prevailing-wage rules required it didn’t excuse the duty to bargain.

4. The 2019 strike was a ULP strike, not an economic strike. The Board found employer misconduct was a “contributing cause” (the Larand Leisurelies standard). Picket signs referenced ULPs, and the General Counsel’s complaint had been distributed at the pre-strike membership meeting. ULP strikers cannot be permanently replaced and are entitled to their jobs back when the strike ends.

For HR teams at unionized employers, the distinctions matter:

* Multiemployer bargaining is a privilege, not a trap. Either side can withdraw before negotiations begin. Forcing the other to stay is a ULP.

* Lockouts must be tied to legitimate bargaining objectives — not the structure of the negotiation.

* Unilateral changes during bargaining is almost always a violation, no matter how compelling the business rationale.

* ULP-strike vs. economic-strike classification drives massive operational consequences — staffing, reinstatement, ability to permanently replace.

Have you ever withdrawn from a multiemployer bargaining group or locked out your employees?