NLRB Rules CVS' "Market Adjustment" Wage Increase During Union Campaign Was Unlawful

The NLRB' s CVS ruling serves as a good reminder for employers to address wage discrepancies before organizing activity begins.

As the old adage goes: ‘If you wait, it may be too late.’

QUICK FACTS:

• Following the COVID-19 lockdowns, and amid a labor shortage crisis, many companies found the wages they paid workers to be inadequate.

• Following the filing of an election petition with the National Labor Relations Board (NLRB) in August 2021 for a store in Orange, CA, CVS Pharmacy announced and granted “market adjustment” wage increases at a number of its Southern California non-union locations, including the Orange, California location.

• Upon losing the election in September 2021, the UFCW filed election objections, including the allegation that “both announced and granted wage increases during the critical period prior to the election” at the Orange, CA location.

• Last week, NLRB agreed with the union and has ordered a rerun election.

DETAILS:

CVS Pharmacy will be facing a second National Labor Relations Board (NLRB) election at a store in Orange, California due to, in part, the granting of "market adjustment” wage increases during the midst of a union organizing campaign.

Earlier this month, the NLRB decided that, by “informing employees of and granting wage increases for employees” CVS violated Section 8(a)(1) of the Act.

In the election, which was held in September 2021, the United Food and Commercial Workers (UFCW), Local 324 lost by only one vote and filed objections to the election. Among the objections filed was the allegation CVS “both announced and granted wage increases during the critical period prior to the election.”

The Timeline & Summary:

Background. In May and June 2021, the UFCW began a union organizing campaign at a number of CVS stores in Southern California.

The following is a summary and timeline of the UFCW campaign, with individual names withheld, based upon the National Labor Relations Board’s decision’s “findings of fact.”¹