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The National Labor Relations Act (NLRA) of 1935 was enacted to balance the bargaining power between workers and employers, especially in response to poor working conditions during the Great Depression. The NLRA applies to most private sector employers but excludes agricultural workers, domestic workers, government employees, and independent contractors. The National Labor Relations Board (NLRB) enforces the NLRA and protects employees’ rights to organize and bargain collectively.

Collective bargaining allows employee representatives and management to negotiate employment terms; subjects fall into mandatory, permissive, or illegal categories. Mandatory bargaining subjects include disability pay, employer-provided health insurance, paid time off, and pension or retirement plans. Employers cannot unilaterally change agreed-upon benefits under a collective bargaining agreement without committing an unfair labor practice. Permissive bargaining subjects (not required for negotiation) include benefits fund administration, retiree medical insurance, and some aspects of workers’ compensation.

Illegal bargaining subjects include topics that violate federal or state laws, such as ERISA standards on funding, participation, vesting, and survivor benefits. Unions also advocate for job security during layoffs and plant closures, sometimes accepting reduced pay and benefits in exchange. The WARN Act, supported by unions, requires employers to give 60 days' notice before mass layoffs or closures, or pay employees for the notice period if they fail to do so.