Federal court backs engineers' union, orders Macy's to reinstate and compensate locked-out workers
A federal appeals court ruled Macy’s violated labor law by locking out union engineers after failed contract talks, underscoring HR’s responsibilities in labor disputes.
On October 20, 2025, the United States Court of Appeals for the Ninth Circuit upheld a National Labor Relations Board (NLRB) order against Macy’s Inc., concluding the company violated the National Labor Relations Act when it locked out members of the International Union of Operating Engineers, Stationary Engineers, Local 39. The dispute arose after Macy’s and the union, which represents building engineers and craftsmen at Macy’s stores in Northern California and Reno, Nevada, failed to reach a new collective bargaining agreement in 2020.
The conflict began as the COVID-19 pandemic forced Macy’s to close stores and furlough employees in early 2020. By mid-August, Macy’s recalled some union engineers as stores reopened. The existing collective bargaining agreement was set to expire on August 31, 2020. After nearly a dozen bargaining sessions, Macy’s presented its final offer regarding wages and pensions. On September 2, 2020, union members overwhelmingly rejected the offer and began a strike on September 4, picketing daily at Macy’s Union Square store in San Francisco.
After three months, on December 4, 2020, the union made an unconditional offer to return to work. Macy’s responded that it was not ready to have the engineers return, citing administrative, logistical, and economic issues. On December 7, some union engineers reported for work but were turned away. Macy’s told the union it would not reinstate employees until a new agreement was reached.
The union filed a charge with the NLRB, alleging Macy’s had committed an unfair labor practice by locking out employees without providing a timely, clear, and complete offer outlining the conditions needed to avoid the lockout. After a six-day hearing, an administrative law judge found that Macy’s violated the NLRA and ordered the company to reinstate the locked-out engineers and compensate them for lost pay and benefits.
Macy’s appealed, but the NLRB affirmed the judge’s findings and modified the order to require Macy’s to compensate employees for any direct or foreseeable financial harm resulting from the lockout, including reasonable job search and interim employment expenses.
The case proceeded to the Ninth Circuit, which, in its October 20, 2025 decision, upheld the NLRB’s order. The court found that Macy’s failed to meet its obligations under the NLRA by not clearly informing employees of the conditions for reinstatement and by locking them out without a legitimate and substantial business justification. The court enforced the Board’s order for reinstatement and make-whole relief but denied the union’s request for additional extraordinary remedies.
This outcome highlights for HR professionals the importance of clear communication and compliance with labor law during collective bargaining and labor disputes, especially when managing unionized workforces and potential lockouts.
