Sixth Circuit Rejects NLRB Bargaining Order Standard, Shaking Up Union Campaigns

The first federal appeals court to squarely reject the NLRB's 2023 Cemex bargaining-order framework delivered its ruling on March 6, vacating a bargaining order against Brown-Forman Corporation, the Kentucky distiller operating Woodford Reserve Distillery, and sending shockwaves through union organizing strategy nationwide.

The Sixth Circuit granted Brown-Forman's petition for review, denied the NLRB's cross-application for enforcement, and remanded the case to the board to determine whether a bargaining order could survive under the older Gissel standard or whether a rerun election is the appropriate path forward. The court accepted the NLRB's underlying unfair labor practice findings, which included Brown-Forman granting wages, benefits, and gifts during the organizing campaign in ways that reasonably tended to interfere with employee free choice. What the court would not accept was the remedy the board chose to impose.

The Cemex framework, established by the NLRB through a 2023 case decision involving Cemex Construction Materials Pacific LLC, had expanded the circumstances under which the board could issue bargaining orders, including in situations where a union had not won an election. For restaurant operators and other employers who had been watching union campaigns intensify across the service industry, Cemex represented one of the board's sharpest enforcement tools.

The Sixth Circuit's objection was procedural as much as substantive. The board, the court held, had used an adjudicatory decision to create a sweeping rule of general applicability, bypassing the statutory rulemaking process. As the court characterized the problem, the NLRB "created a new standard for issuing future bargaining orders that was neither derived from the case-specific facts nor in furtherance of fashioning a remedy that resolved the parties' dispute." That kind of broad policy shift, the court concluded, cannot be announced through a single case decision.

The ruling restores the traditional Gissel standard as the operative framework within the Sixth Circuit's jurisdiction. Under Gissel, a bargaining order is an extraordinary remedy, available only when employer misconduct is so severe that conducting a fair election would be unlikely. That is a considerably higher bar than what Cemex had introduced.

The immediate geographic consequence is significant: the Sixth Circuit covers Tennessee, Kentucky, Ohio, and Michigan. Within those four states, Cemex remedies are now unenforceable in federal court. Employers facing organizing campaigns in that footprint can no longer have Cemex-based bargaining orders enforced against them by the circuit court.

Outside that jurisdiction, the legal landscape is murkier. Cemex remains binding board precedent nationally. The NLRB can still apply it in decisions and pursue it in other circuits unless the Supreme Court weighs in or the board itself reverses course. Attorneys at Franczek P.C., writing in the days after the ruling, advised that even employers in the Sixth Circuit should continue to exercise caution during organizing campaigns, given the board's continued authority to issue Cemex-based decisions even if those orders face resistance on appeal.

For the restaurant industry, where union campaigns have gained momentum at chains and independent operators alike, the ruling narrows one avenue the NLRB could use to compel recognition without an election victory. Whether other circuit courts follow the Sixth Circuit's reasoning remains the central open question, and the answer will define how aggressively the board can pursue bargaining orders in the years ahead.