Mid-sized businesses (defined as 500 to 10,000 employees) impacted by the Coronavirus may be able to obtain relief loans under the COVID-19 stimulus law, the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”), but only if non-union employers agree not to oppose the unionization of their workforce for the term of the loan, and if unionized employers agree not to “abrogate” existing collective bargaining agreements for the term of the loan and 2 years following loan repayment.

First, for the entire term of a Treasury Department loan, an employer must agree to “remain neutral in any union organizing effort.”  In other words, if a union comes knocking, those businesses cannot oppose unionization.  The bill does not define or elaborate on the concept of employer neutrality or how such obligations would be enforced (although future regulations may provide more detail).  Importantly, it does not require “card check” agreement – allowing an employer to insist on a secret ballot election at the National Labor Relations Board.

Second, for the entire term of the loan and 2 years following loan repayment, businesses must certify that they “will not abrogate existing collective bargaining agreements.”  The word “abrogate” is not defined in the statute, there has been no regulatory guidance to date as to its scope (or how it will be enforced) and it is not clear whether the statute imposes additional obligations beyond those that are imposed under the National Labor Relations Act.

For more information on the Coronavirus, visit our Coronavirus Resource Center for guidance on risk management measures, practical steps businesses can take and resources to help manage ongoing operations.

Photo of Joseph Baumgarten Joseph Baumgarten

Joseph Baumgarten is co-chair of the Labor & Employment Law Department, which was named by The American Lawyer as one of the top three U.S. practices, ranked Band 1 Nationwide by Chambers USA 2014 and was a recipient of the Chambers USA 2012…

Joseph Baumgarten is co-chair of the Labor & Employment Law Department, which was named by The American Lawyer as one of the top three U.S. practices, ranked Band 1 Nationwide by Chambers USA 2014 and was a recipient of the Chambers USA 2012 Award for Excellence. Joe has been widely recognized as a leading labor and employment lawyer by Chambers, US Legal 500, HR Executive Law Dragon and Best Lawyers. He was also named one of the 2013 BTI Client Service All-Stars, an elite group of attorneys nominated solely by clients as the very best in client service.

Joe represents publicly held and privately owned employers in virtually all areas of labor and employment law, including claims under the National Labor Relations Act, Title VII, the ADEA, ADA, FLSA, WARN and Sarbanes-Oxley, as well as breach of contract claims arising out of executive compensation disputes.

Photo of Michael Lebowich Michael Lebowich

Michael J. Lebowich is a partner in the Labor & Employment Law Department and co-head of the Labor-Management Relations Group. He represents and counsels employers on a wide range of labor and employment matters, with a particular interest in the field of traditional…

Michael J. Lebowich is a partner in the Labor & Employment Law Department and co-head of the Labor-Management Relations Group. He represents and counsels employers on a wide range of labor and employment matters, with a particular interest in the field of traditional labor law.

Michael acts as the primary spokesperson in collective bargaining negotiations, regularly handles grievance arbitrations, assists clients in the labor implications of corporate transactions, and counsels clients on union organizing issues, strike preparation and day-to-day contract administration issues. He also has significant experience in representation and unfair labor practice matters before the National Labor Relations Board.

Photo of Joshua Fox Joshua Fox

Joshua S. Fox is a senior counsel in the Labor & Employment Law Department and a member of the Sports, Labor-Management Relations, Class and Collective Actions and Wage and Hour Groups.

As a member of the Sports Law Group, Josh has represented several…

Joshua S. Fox is a senior counsel in the Labor & Employment Law Department and a member of the Sports, Labor-Management Relations, Class and Collective Actions and Wage and Hour Groups.

As a member of the Sports Law Group, Josh has represented several Major League Baseball Clubs in all aspects of the salary arbitration process, including the Miami Marlins, Boston Red Sox, Los Angeles Dodgers, Kansas City Royals, San Francisco Giants, Tampa Bay Rays and Toronto Blue Jays. In particular, Josh successfully represented the Miami Marlins in their case against All-Star Catcher J.T. Realmuto, which was a significant club victory in salary arbitration. Josh also represents Major League Baseball and its clubs in ongoing litigation brought by current and former minor league players who allege minimum wage and overtime violations. Josh participated on the team that successfully defended Major League Baseball in a wage-and-hour lawsuit brought by a former volunteer for the 2013 All-Star FanFest, who alleged minimum wage violations under federal and state law. The lawsuit was dismissed by the federal district court, and was affirmed by the U.S. Court of Appeals for the Second Circuit.

Josh also has extensive experience representing professional sports leagues and teams in grievance arbitration proceedings, including playing a vital role in all aspects of the grievance challenging the suspension for use of performance-enhancing drugs of then-New York Yankees third baseman Alex Rodriguez. Josh also has counseled NHL Clubs and served on the trial teams for grievances alleging violations of the collective bargaining agreement, including cases involving use of performance-enhancing substances, domestic violence issues, and supplementary discipline for on-ice conduct. He has played a key role in representing professional sports leagues in all aspects of their collective bargaining negotiations with players and officials, including the Major League Baseball, National Hockey League, the National Football League, Major League Soccer, the Professional Referee Organization, and the National Basketball Association,.

In addition, Josh has extensive experience representing clients in the performing arts industry, including the New York City Ballet, New York City Opera, Big Apple Circus, among many others, in collective bargaining negotiations with performers and musicians, the administration of their collective bargaining agreements, and in grievance arbitrations.

Josh also represents a diverse range of clients, including real estate developers and contractors, pipe line contractors, hospitals, hotels, manufacturers and public employers, in collective bargaining, counseling on general employment matters and proceedings before the National Labor Relations Board, New York State Public Employment Relations Board and arbitrators.

Josh has also recently served as an adjunct professor at Cornell University’s School of Industrial Labor Relations for the past two years, teaching a course regarding Major League Baseball salary arbitration.

Prior to joining Proskauer, Josh worked for a year and a half at the National Hockey League, where he was involved in all labor and employment matters, including preparations for collective bargaining, grievance arbitration, contract drafting and reviewing and employment counseling. Josh also interned in the labor relations department of Major League Baseball and at Region 2 of the National Labor Relations Board. He was a member of the Brooklyn Law Review and the Appellate Moot Court Honor Society and served as president of the Brooklyn Entertainment and Sports Law Society.