Legal Definitions - lockout

A lockout occurs when an employer temporarily closes a business or withholds work from employees during a labor dispute. This action is typically initiated by management to exert economic pressure on employees or their union, aiming to achieve a more favorable outcome in collective bargaining negotiations for a new contract.

Historically, lockouts were sometimes categorized as "defensive" (taken to prevent imminent harm or protect company assets) or "offensive" (taken to gain a bargaining advantage). However, the legal distinction between these types has largely been removed by the U.S. Supreme Court, which now applies a balancing test to determine the legality of any lockout. It is crucial to understand that a lockout is an action initiated by the employer, distinguishing it from a strike, which is an action initiated by employees.

Here are some examples illustrating how a lockout might occur:

• Example 1: Contract Negotiation Impasse
  A large automotive parts manufacturer and its union have been negotiating a new collective bargaining agreement for months. After reaching an impasse on key issues like wages and benefits, the company believes the union's demands are unsustainable. To pressure the union into accepting its terms, the manufacturer announces a lockout, temporarily closing its factories and preventing all unionized employees from reporting to work until a new agreement is reached.

  Explanation: This scenario demonstrates a lockout as an employer's action to close its business and withhold work from employees during a labor dispute, specifically to gain leverage in contract negotiations.

• Example 2: Preventing Operational Disruption
  A major shipping port is in contentious negotiations with its dockworkers' union. The union has threatened a series of intermittent work stoppages and slowdowns that would severely disrupt global supply chains and cause significant financial losses for the port and its clients. To avoid this unpredictable disruption and to force a resolution, the port authority declares a lockout, temporarily shutting down all loading and unloading operations and preventing dockworkers from accessing the facilities until a new contract is finalized.

  Explanation: Here, the port, as the employer, initiates a lockout by closing operations and withholding work to prevent potential operational chaos and economic harm threatened by the ongoing labor dispute, aiming to bring about a swift resolution.

• Example 3: Response to Unofficial Work Action
  A regional airline is negotiating with its flight attendants' union. Although no formal strike has been called, the flight attendants begin an unofficial "sick-out" campaign, with an unusually high number calling in sick, causing numerous flight cancellations and delays. Facing mounting financial losses and reputational damage, the airline responds by declaring a lockout, grounding a significant portion of its fleet and preventing all flight attendants from working until a new contract is agreed upon.

  Explanation: In this instance, the airline, as the employer, implements a lockout by effectively closing part of its business (grounding flights) and withholding work from employees (flight attendants) in response to an ongoing labor dispute and the disruptive unofficial work action, aiming to compel a resolution.