Denying the Existence of a Bargaining Impasse Doesn’t Make it True, at Least Not in the D.C. Circuit

On June 13, 2025, the D.C. Circuit refused to enforce an “irrational” Board order finding an employer violated its duty to bargain by declaring impasse. By declaring impasse, the employer sought to implement its last, best, and final proposal related to withdrawing from a multiemployer pension fund. The union would not agree to permit withdrawal. Despite having engaged in over 26 bargaining sessions in five years, including a three-year strike over the issue by the unit’s seven members, neither party changed its position. The union admitted – at the bargaining table – that it would not accept a contract that included the employer’s ability to withdraw from the pension fund and the company stated that it would not agree to a contract that included continuing contributions to the pension fund. However, the union denied that impasse existed. The Board agreed with the union. The D.C. Circuit did not. 

The Board had concluded that an “impasse” did not exist because the union: (1) denied impasse; (2) could have “conceivably” changed its position despite not doing so for years beforehand; and (3) had recently issued information requests. Sharply rebuking the Board for a decision that “did not achieve even ‘minimal compliance’” with its duty to act on substantial evidence, the court in Troy Grove. v. National Labor Relations Board, No. 23-1164 (June 13, 2025) rejected the Board’s formalistic and “illogical” factual and legal analysis. 

Concluding that the record established the employer’s statement about impasse and its right to implement its offer were factually and legally accurate, the court did not reach the question of whether a simple threat of implementation of a last, best, and final offer would violate the Act if the parties were not, actually, at impasse.  

Background

The parties were bound by a collective bargaining agreement (CBA) from July 2014 to May 2016 covering seven bargaining unit employees. The CBA required the company to contribute to a multi-employer defined pension plan. When it came time to negotiate a successor agreement, the company discovered that its withdrawal liability from the Pension Fund had increased from $964,000 to $1.35 million over two years. Concerned about the fund’s financial health, the company proposed withdrawing from the pension fund and offered alternative retirement plans. The parties negotiated over the issue but made no progress on this issue, resulting in the employer issuing a last, best, and final offer and the union responding by going on a three-year strike during which the company hired replacement workers. 

When the strike ended in 2021 and negotiations resumed, the parties’ positions regarding the pension fund had not changed. The employer proposed withdrawing from the fund; the union proposed the opposite. Both parties explicitly rejected each other’s positions and stated that they could not agree to a contract that included the other’s proposal The employer then declared that the parties were at an impasse.

Request for Information

The union responded by denying that the parties were at an impasse and issuing an extensive request for information (RFI). The company provided almost 300 pages of documents in response to the RFI, addressing most but not all of the union’s requests, and reiterated its impasse position. 

Threat to Cease Contributions to the Pension Fund

The employer again stated that the parties were at an impasse and that it had the right to withdraw from the Pension Fund, although it did not ultimately do so. The union filed an unfair labor practice charge alleging the employer’s declaration of impasse violated its duty to bargain in good faith pursuant to Section 8(a)(5) of the National Labor Relations Act.

ALJ and Board Decision

A hearing was held before Administrative Law Judge (ALJ) Michael Rosas. The ALJ conceded that the pension fund was a critical issue to bargaining but relied on the union’s denial of impasse to conclude “at no time…did both parties understand themselves to be at impasse.” The ALJ speculated that it was “plausible” the union would have yielded on the pension fund issue in exchange for concessions on other economic issues, had bargaining continued. The ALJ further held that the outstanding items in the RFI prevented a true impasse.

A divided Board affirmed the ALJ’s decision.

The D.C. Circuit Refuses to Enforce the Board’s Order

The employer petitioned the D.C. Circuit for review of the Board’s order. Pursuant to the Administrative Procedure Act, 5 U.S.C. § 706(2)(E), and the National Labor Relations Act, 29 U.S.C. § 160(e), federal circuit courts review Board decisions to assess whether they are supported by “substantial evidence.” While this is generally considered a relatively low bar, the court concluded the Board’s decision not only failed to meet this requirement but was “not supported by any evidence,” and was “arbitrary, capricious, and senseless.” 

Rejecting the idea that no impasse was reached because the union so claimed and because there was a pending information request, the court refused to enforce the Board’s order, observing, “It amounts to the faintly ridiculous proposition that the parties were not at an impasse because they were at an impasse about whether they were at an impasse.” The court further dismissed the ALJ’s finding that the union “might” have become flexible on pension contributions if negotiations continued as “pure speculation, contradicted by five years of bargaining history.”

The court emphasized that accepting the union’s refusal to declare impasse as evidence that impasse does not exist ignores the reality that unions have a distinct incentive not to admit impasse exists – and almost never do – because doing so allows employers to implement their final offers. Instead, the court emphasized, any adjudicator must look at objective evidence to determine if there is true impasse. Here, that evidence consisted of five years of negotiations without agreement, a three-year strike over the pension issue, and, perhaps most importantly, explicit mutual rejections of each side’s pension proposals during the July 2021 bargaining sessions. Given that the parties were at a genuine impasse, the company’s statement about ceasing pension contributions was not an unfair labor practice. The circuit court vacated the Board’s order. 

Takeaway Lessons

This decision is another in a line of recent cases wherein circuit courts throughout the country have pushed back on the Board and shown that the “substantial evidence” standard has teeth. At least in federal court, the existence of impasse is not easily defeated by a union’s refusal to acknowledge its existence or by the presentation of a request for information issued for the purpose of preventing a finding of impasse. 

Key takeaways include:

• Impasse, a term that does not appear in the NLRA, is a deadlock or stalemate in bargaining. One definition of “impasse” endorsed by the court here is “that point at which the parties have exhausted the prospects of concluding an agreement and further discussions would be fruitless.”
• Whether an “impasse” has been reached depends on objective evidence, such as bargaining history, including proposals, representations at the table, the use of economic weapons, etc., and is not dependent upon the parties’ agreement that impasse has been reached.
• An impasse can exist even if the union tries to use RFIs or other tactics to prevent the employer from implementing its last, best, and final offer.
• Even if an RFI is a transparent attempt to avoid impasse, employers should still respond promptly and as completely as practicable. It was important to the court’s analysis that the employer in this case immediately provided extensive information responding to most of the union’s RFI requests.
• If the employer anticipates an impasse may arise, it is critical to have clear documentation and record evidence supporting how that impasse came to be. Here, the employer could present years of bargaining history and clear communications to the union about its position, which proved critical.
• Finally, this case serves as yet another reminder that Article III courts provide an important legal backstop. Despite the relatively low bar set by the “substantial evidence” standard, employers should not expect courts to defer to the Board as a matter of course. However, recall that the Board follows the non-acquiescence doctrine so, outside of the D.C. Circuit, it will continue to follow its own decision issued in this case and not the D.C. Circuit’s opinion.