D.C. Circuit Strikes Down NLRB 'Successor Bar' Doctrine After Loper Bright
Acquiring employers and M&A counsel can now present evidence that an incumbent union lacks majority support, ending the NLRB's automatic one-year recognition bar.
The D.C. Circuit, on remand from the Supreme Court in light of Loper Bright, ruled 2-1 in Hospital Menonita de Guayama, Inc. v. NLRB that the Board's 'successor bar' doctrine is inconsistent with the National Labor Relations Act. The doctrine had required successor employers to recognize and bargain with an incumbent union for up to one year, irrebuttably presuming continued majority status. The majority (Rao and Walker) held that the bar impermissibly suspends Section 7 employee-freedom guarantees and majority-rule principles, and that the Board lacks statutory authority to impose it. The decision signals broader judicial willingness to scrutinize NLRB presumptions and doctrines not grounded in the Act's text. Acquiring employers should reassess diligence on union representation, document employee sentiment, and evaluate options to withdraw recognition where objective evidence shows loss of majority support. The ruling also foreshadows challenges to other Board-created bars and presumptions across labor law.