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NLRB Law Memo 10/12/2007

NLRB Law Memo 10/12/2007
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NLRB - Staff summarized 14 decisions.

Asbestos Workers Local 84 (DST Insulation, Inc.) (8-CB-10424; 351 NLRB No. 3) Bedford, OH Sept. 24, 2007.
http://www.nlrb.gov/shared_files/Board%20Decisions/351/v3513.htm

The Board, adopting the administrative law judge, found that the Respondent did not violate Section 8(b)(3) of the Act by failing to bargain with the Employer. The Board majority of Chairman Battista and Member Liebman found that the Employer adopted by its conduct the terms of a collective-bargaining agreement and, therefore, the Respondent had no duty to bargain over terms of an entirely new contract. The Board majority found that the Employer adopted the contract by engaging in substantial conduct manifesting an intent to be bound, including paying new wage rates under the contract, making fringe benefit contributions, acquiescing to a stipulated judgment in federal court and paying the amounts owed under the agreement, honoring the contractual union-security clause and deducting and remitting union dues, using the Respondent?s exclusive hiring hall to secure employees as a union contractor, and corresponding and meeting with the Respondent in a manner consistent with the status of a union contractor. The Board majority found that, under prevailing precedent, this course of conduct was compelling evidence that the Employer had manifested an intent to be contractually bound.

Member Kirsanow dissented and found that the Respondent violated Section 8(b)(3). Viewing the evidence as a whole, Member Kirsanow found that the Employer did not evince an intent to be bound to the current agreement.  In his view, the Employer did not adopt the contract because the Employer?s president made statements indicating an intent not to be bound and the Respondent did not claim that the Employer adopted the agreement.  In Member Kirsanow?s view, the Employer?s statements put its subsequent adherence to particular terms of the agreement in a different light and supported a finding that there was no binding contract. Accordingly, Member Kirsanow found that the Respondent breached its duty to bargain by declining the Employer?s request to bargain over a new contract.

(Chairman Battista and Members Liebman and Kirsanow participated.)

             Charge filed by DST Insulation, Inc.; complaint alleged violation of Section 8(b)(3).  Hearing at Cleveland on Feb. 14, 2006.  Adm. Law Judge Karl H. Buschmann issued his decision May 24, 2006.

***

Baptist Hospital of East Tennessee (10-CA-33684; 351 NLRB No. 12) Knoxville, TN Sept. 27, 2007.
http://www.nlrb.gov/shared_files/Board%20Decisions/351/v35112.htm

A Board majority of Chairman Battista and Member Schaumber, affirming the administrative law judge, found that the Respondent did not violate Section 8(a)(5) of the Act by unilaterally implementing a change on January 1, 2002, concerning the scheduling of holiday shift work for unit employees assigned to the Respondent?s in-patient radiology unit.

The Board majority determined initially that the General Counsel?s theory of the case involved solely a unilateral-change violation, noting that the General Counsel never clearly asserted an alternative Section 8(d) contract-modification theory.

The Respondent had argued that, through the management-rights clause in the parties? collective-bargaining agreement, the Union waived its right to bargain over the scheduling change. The Board majority agreed with the Respondent and the judge that the evidence showed a clear and unmistakable waiver. They found in particular that the language in the management-rights clause giving the employer the right ?to determine and change starting times, quitting times and shifts,? to ?assign? employees, and to ?change methods and means by which its operations are to be carried on? provided the Respondent with the fundamental right to schedule employees. The Respondent?s unilateral change in scheduling employees for holiday-shift work was consistent with this right. Accordingly, the majority affirmed the judge?s recommended dismissal of the complaint.

In a footnote, Chairman Battista, citing his dissent in Provena St. Joseph Medical Center, 350 NLRB No. 64 (2007), stated that his conclusion that dismissal is appropriate would be the same under a ?contract coverage? test. Member Schaumber agreed, citing his dissenting position in California Offset Printers, 349 NLRB No. 71 (2007).

Member Liebman, dissenting in the present case, would reverse the judge?s dismissal of the complaint. Citing her dissent in Bath Iron Works Corp., 345 NLRB No. 33 (2005), affd. sub nom. Bath Marine Draftsmen?s Assn. v. NLRB, 475 F.3d 14 (1^st. Cir. 2007), she observed that her ?clear and unmistakable waiver? analysis would be the same whether the General Counsel?s theory was ?unilateral change? or ?contract modification? under Section 8(d).  In her view, the management-rights language relied on by her colleagues did not establish a clear and unmistakable waiver, because language in the collective-bargaining agreement separate from the management-rights clause appeared to prohibit the Respondent from making the scheduling change.

(Chairman Battista and Members Liebman and Schaumber participated.)

Charge filed by Professional Employees Local 2001; complaint alleged violations of Section 8(a)(5) and (1).  Hearing held by telephone by agreement of the parties on Jan. 10, 2003.  Adm. Law Judge Lawrence W. Cullen issued his decision Feb. 20, 2003.

***

BE&K Construction Co. (32-CA-9479, et al.; 351 NLRB No. 29) Pittsburg, CA Sept. 29, 2007.
http://www.nlrb.gov/shared_files/Board%20Decisions/351/v35129.htm

The Board, in a 3-2 decision, held that the filing and maintenance of a reasonably based lawsuit does not violate the National Labor Relations Act, regardless of the motive for bringing the suit.

BE&K filed a lawsuit against several unions in federal district court in California. Ultimately, the suit alleged that the unions were engaged in activities violating both the Act and antitrust laws. The district court granted the unions? motions for summary judgment and dismissed the employer?s suit. The United States Court of Appeals for the Ninth Circuit affirmed the district court?s decision.

The unions filed unfair labor practice charges alleging that the lawsuit was unlawful because it was retaliatory, and the General Counsel issued a complaint.  In an earlier decision in this proceeding, the Board found, pursuant to Bill Johnson?s Restaurants, Inc. v. NLRB, 461 U.S. 731 (1983), that the employer?s unsuccessful suit violated Section 8(a)(1) because it was filed to retaliate against the exercise of activities protected by the Act. BE&K Construction Company, 329 NLRB 717 (1999).  The United States Court of Appeals for the Sixth Circuit enforced the Board?s decision. BE&K Construction Co. v. NLRB, 246 F.3d 619 (2001).

            The Supreme Court, however, rejected the Board?s analysis on First Amendment grounds.  BE&K Construction Co. v. NLRB, 536 U.S. 516 (2002).  The Court first evaluated its relevant precedent concerning the First Amendment?s right to petition the government through the courts, most of which had been developed in antitrust cases.  The Court found that the threat of an NLRB adjudication amounted to a burden on such petitioning.  It also found that the Board?s standard for evaluating the lawfulness of completed, unsuccessful lawsuits raised a difficult First Amendment issue.  The Court adopted a limiting construction of Section 8(a)(1) to avoid this constitutional issue, and it invalidated the Board?s legal standard because it did not comport with that limited construction.  The Court remanded the case to the Board for further proceedings consistent with its opinion.

On remand, the Board majority of Chairman Battista and Members Schaumber and Kirsanow noted, first, that in Bill Johnson?s, the Court had held that, in order to protect the First Amendment right to petition, an ongoing, reasonably based lawsuit could not be enjoined as an unfair labor practice even if its motive was to retaliate against the exercise of rights protected by the Act.  In light of the Court?s opinion in BE&K, the Board then found:

   These principles, in our view, are equally applicable to both completed and ongoing lawsuits. ...

   [The] chilling effect on the right to petition exists whether the Board burdens a lawsuit in its initial phase or after its conclusion.  Indeed, the very prospect of liability may deter prospective plaintiffs from filing legitimate claims. Thus, the same weighty First Amendment considerations catalogued by the Court in Bill Johnson?s with respect to ongoing lawsuits apply with equal force to completed lawsuits.  In sum, we see no logical basis for finding that an ongoing, reasonably based lawsuit is protected by the First Amendment right to petition, but that the same lawsuit, once completed, loses that protection solely because the plaintiff failed to ultimately prevail.  Nothing in the Constitution restricts the right to petition to winning litigants.

   ... Accordingly, we find that, just as with an ongoing lawsuit, a completed lawsuit that is reasonably based cannot be found to be an unfair labor practice.  In determining whether a lawsuit is reasonably based, we will apply the same test as that articulated by the Court in the antitrust context: a lawsuit lacks a reasonable basis, or is ?objectively baseless,? if ?no reasonable litigant could realistically expect success on the merits.?  Professional Real Estate Investors, 508 U.S. at 60.

In applying its new standard to the facts of the case, the Board found that it was bound by the Court?s view that the employer?s lawsuit was reasonably based, but it reached the same conclusion based on its own analysis of the suit.  Although the suit ultimately was unsuccessful, it was not shown to lack a reasonable basis.  Accordingly, the Board dismissed the complaint without evaluating the employer?s motive for filing the suit.

In dissent, Members Liebman and Walsh disagreed with the breadth of the majority?s decision.  In their view, the Supreme Court did not hold that all reasonably based suits are constitutionally immune from liability under the Act, and the majority went too far in protecting First Amendment interests at the expense of rights protected by the Act.   The dissent stated:

   What the BE & K decision leaves open is convincingly described by the concurring opinion of Justice Breyer in BE & K, which was joined by Justices Stevens, Souter, and Ginsburg:  The Board may not ?rest its finding of ?retaliatory motive? almost exclusively upon the simple fact that the employer filed a reasonably based but unsuccessful lawsuit and the employer did not like the union.?  536 U.S. at 539.  Left open, in contrast, is the possibility of imposing unfair labor practice liability in ?other circumstances in which the evidence of ?retaliation? or antiunion motive might be stronger or different.?  Id.

   One example, as Justice Breyer?s concurrence observes, is the situation expressly referred to by the Court?s opinion: a case involving ?an employer, indifferent to outcome, who intends the reasonably based but unsuccessful lawsuit simply to impose litigation costs on the union.?  Id.  A second example is the lawsuit brought by an employer ?as part of a broader course of conduct aimed at harming the unions and interfering with employees? exercise of their rights under? the Act.  Id.

In the dissent?s view, Bill Johnson?s requires the Board to balance the need to protect Section 7 rights from incursion by lawsuits against the need to safeguard the constitutional right of access to the courts.  Although the BE&K Court, distanced itself from Bill Johnson?s, the dissent asserts that it did not reject this balancing principle, or preclude the Board from imposing a measured burden on the right to petition in order to protect rights under the Act.

The dissent would have remanded the case for further litigation to evaluate whether the employer?s suit was retaliatory because it was brought to impose litigation costs on the unions or as part of a broader pattern of conduct unlawful under the Act.

(Full Board participated.)

Brown & Root Power and Mfg., Inc., A Subsidiary of Brown and Root, Inc. (15-CA-12752, 12875; 351 NLRB No. 20) Panama City, FL Sept. 28, 2007.
http://www.nlrb.gov/shared_files/Board%20Decisions/351/v35120.htm

The Board, adopting the administrative law judge in part, found unanimously that the Respondent violated Section 8(a)(3) and (1) of the Act by failing to hire, and to consider for hire, applicants at a jobsite who had an intent to organize.  The Board found that the Respondent had plans to hire at the jobsite, that the applicants had experience or training relevant to the positions to be filled, and that antiunion animus contributed to the decision not to hire and consider for hire.  Accordingly, the Board found that the General Counsel had met its burden under FES, 331 NLRB No. 9 (2000).

Although the Board held that the Respondent demonstrated it had a preferential hiring system based on applicants? status as former employees and referral from supervisors and the on-site project operator, the Board found that the Respondent did not show that it maintained an additional preference category pertaining to ?gate hires.?  The Board held that instatement was appropriate for openings within each of the Respondent?s hiring classifications that were discriminatorily filled by nonpreference hires.  

Additionally, the Board found that the Respondent was aware that certain individual applicants had an active union involvement and organizational intent, but found that the applications of certain other applicants did not show an active intent to organize or present union affiliation.     

(Chairman Battista and Members Liebman and Kirsanow participated.)

            Adm. Law Judge J. Pargen Robertson issued his supplemental decision May 10, 2001.

***

Contractor Services, Inc. (10-CA-28856 et al.; 351 NLRB No. 4) Davenport, IA Sept. 27, 2007.
http://www.nlrb.gov/shared_files/Board%20Decisions/351/v3514.htm

Chairman Battista and Members Schaumber and Kirsanow found, contrary to the administrative law judge, that backpay claimant Tracy Landers, a paid union organizer, was not entitled to any backpay.  The backpay claim of discriminatee William Hunt was remanded to the judge for further consideration in light of the Board?s decision in Oil Capitol Sheet Metal, 349 NLRB No. 118 (2007).

            In a 1997 decision subsequently enforced by the 11^th Circuit, the Board held that the Respondent discriminatorily denied employment to Landers and Hunt following their submission of applications for work in 1995.  Contractor Services, 324 NLRB 1254 (1997), enfd. Contractor Services v. NLRB, No. 00-10668 (11th Cir. 2000).  Thereafter, a compliance proceeding was held to determine their entitlement to backpay. 

            Hunt, a volunteer union organizer, was a salt.  Pursuant to Oil Capitol Sheet Metal, the General Counsel therefore had the burden of proving the duration of his backpay period.  The Board remanded the case to the judge for further proceedings on that issue.

            Landers, a paid union organizer, also was a salt.  The Board did not remand his backpay claim, however, because he was entitled to no backpay under established law.  First, the Board held that the General Counsel failed to show that his backpay calculations for Landers were reasonable and not arbitrary.  Those calculations assumed that he would have accepted referrals to any location even those that required significant travel, despite substantial evidence that he would not have accepted referrals to locations outside of the union?s geographic jurisdiction because such work would have interfered with his responsibilities to the union.  Second, the Board held that he failed to mitigate his damages by making an honest, good faith effort to find interim work.  He limited his search to nonunion employers, and did not seek employment on many short duration jobs, or jobs outside the union?s geographic jurisdiction, because they did not offer substantial organizing opportunities.  Moreover, he failed to expand his search when his initial efforts were unsuccessful and only applied to 23 employers during the 46-month backpay period.  Taken as a whole, the Board found these haphazard efforts insufficient especially when contrasted with the success in obtaining employment of Hunt and another discriminatee, who did not similarly limit their search efforts.

(Chairman Battista and Members Schaumber and Kirsanow participated.)

Hearing at Atlanta, GA, Dec. 3 and 4, 2001.  Adm. Law Judge Lawrence W. Cullen issued his decision April 24, 2002. 

***

Dana Corp. and Metaldyne Corp. (6-RD-1518, 1519 and 8-RD-1976; 351 NLRB No. 28) St. Mary?s, PA and Upper Sandusky, OH Sept. 29, 2007.
http://www.nlrb.gov/shared_files/Board%20Decisions/351/v35128.htm

The Board, in a 3-2 decision, modified its recognition-bar doctrine, and held that an employer?s voluntary recognition of a labor organization does not bar a decertification or rival union petition that is filed within 45 days of the notice of recognition.

            In deciding this case the Board considered the positions of the parties and amicus submissions from various companies, organizations, and individuals, as well as Members of the U.S. Senate and U.S. House of Representatives.

            Under its former policy, established in Keller Plastics Eastern, Inc., 157 NLRB 583 (1966), an employer?s voluntary recognition of a union, based on a showing of the union?s majority status, barred a decertification petition filed by employees or a rival union?s petition for a reasonable period of time.  The Board had reasoned that labor-relations stability was promoted by a rule under which a voluntarily recognized union was insulated from challenge to its status while negotiating for a first collective-bargaining agreement. 

In Dana, the Board majority of Chairman Battista and Members Schaumber and Kirsanow concluded that although the basic justifications for providing an insulated period are sound, they do not warrant immediate imposition of an election bar following voluntary recognition.  The Board held that the uncertainty surrounding voluntary recognition based on an authorization card majority, as opposed to union certification after a Board election, justifies delaying the election bar for a brief period during which unit employees can decide whether they prefer a Board-conducted election.  Under the Board?s new policy, an employee or rival union may file a petition during a 45-day period following notice that a union has been voluntarily recognized.  The petition will be processed if, like other petitions, it is supported by 30 percent of the bargaining unit.  The Board will apply this modified procedure prospectively only. 

In dissent, Members Liebman and Walsh stated that nothing in the majority?s decision justifies its radical departure from the longstanding and judicially approved procedure first announced in Keller Plastics.  The dissent maintains that voluntary recognition is a favored element of national labor policy, yet the majority relegates it to disfavored status by allowing a minority of employees, the number needed to file a decertification petition, to disrupt the bargaining process just as it is getting started.  This, the dissent contends, will discourage voluntary recognition altogether.

(Full Board participated.)

***

Fluor Daniel, Inc. (26-CA-13842; 351 NLRB No. 14) Greenville, SC Sept. 28, 2007.
http://www.nlrb.gov/shared_files/Board%20Decisions/351/v35114.htm

This case involved compliance proceedings concerning the portion of the Board?s original decision in 311 NLRB 498 (1993) that the United States Court of Appeals for the Sixth Circuit had upheld in 161 F.3d 953 (6^th Cir. 1998).  (The court had remanded a separate portion of the case for further findings; the Board resolved exceptions to that portion of the case in Fluor Daniel, Inc., 350 NLRB No. 66 (2007).)  The compliance proceedings involved one discharged employee (employee Bolen) and two union salt-applicants (the Coons brothers) whom the Respondent had discriminatorily refused to hire.

            With respect to employee Bolen, a Board majority (Members Schaumber and Kirsanow) assumed, without deciding, that the presumption of continued employment set forth in Dean General Contractors, 285 NLRB 573 (1987), did not apply, but found that the General Counsel nevertheless provided sufficient affirmative evidence that Bolen would have been employed throughout the backpay period because Bolen would have been subject to the Respondent?s preference for hiring former employees and because Bolen worked continuously throughout the backpay period.  The Board also rejected the Respondent?s claim that Bolen was obligated to, but failed, to reapply, and found that the Respondent failed to demonstrate that it lacked available positions that were substantially equivalent to Bolen?s former position.  In addition, the Board rejected the Respondent?s claim that the judge erred by allowing the General Counsel to exclude lower-level ?helper? positions in calculating Bolen?s backpay, noting the compliance officer?s testimony that Bolen would not have accepted such a position.  The Board also affirmed the judge?s approval of the General Counsel?s use, in calculating gross backpay, of the top 10 percent of employees in terms of number of hours worked in each individual year of the backpay period, because Bolen had been consistently employed, and the Respondent had jobs available for which Bolen was qualified, throughout that entire period.  The Board rejected, as unsupported by pertinent evidence, the Respondent?s claim that a ?seasonal? variation should have applied in calculating Bolen?s backpay.  Finally, a Board majority (Members Liebman and Kirsanow) found that the judge did not err by beginning Bolen?s backpay period on May 3, 1990, as that had been the date on which the initial judge?s decision had found that Bolen had been ?effectively discharged,? the Board and the court had not disturbed that holding, and the Respondent had not established facts that would have warranted altering the date.

            With respect to the Coons brothers, the majority (Members Schaumber and Kirsanow) remanded the portion of the case concerning them for further findings in light of the Board?s decision in Oil Capitol Sheet Metal, Inc., 349 NLRB No. 118 (2007).  In doing so, the majority noted that on remand, the judge would be foreclosed from revisiting the Board?s previous order of instatement, as the Order had been enforced by the court.  However, the majority found that the judge would not be precluded from applying Oil Capitol in determining the duration of the backpay periods.

            Member Liebman dissented in part, stating that she would find that the law of the case required the application of Dean General to Bolen and the Coons brothers.

            Member Schaumber also dissented in part, stating that the record did not support beginning Bolen?s backpay period on May 3, as Bolen had indicated that he would not return to work until picketing ended, and the court had assumed that picketing had continued beyond that date.

(Members Liebman, Schaumber, and Kirsanow participated.)

***

Goya Foods of Florida (12-CA-21464, et al.; 351 NLRB No. 13) Miami, FL Sept. 28, 2007.
http://www.nlrb.gov/shared_files/Board%20Decisions/351/v35113.htm

In the third of recent decisions involving the same parties, the Board adopted the administrative law judge?s findings that the Respondent violated Section 8(a)(5) and (1) of the Act by unilaterally changing bargaining unit drivers? routes, wages, and hours when implementing a new Roadnet software routing program.  The Board reversed the judge to find that the Respondent also violated Section 8(a)(5) and (1) by unilaterally implementing a new inspection procedure for drivers returning to the Respondent?s warehouse with goods refused by customers, and by unilaterally reassigning stores on the delivery route of a discharged driver to other drivers.

The Respondent contended that all changes took place after it lawfully withdrew recognition from the Union as the previously certified bargaining representative of employees in two bargaining units.  However, in Goya Foods of Florida, 347 NLRB No. 103 (2006)(Goya I), the Board found that the withdrawal of recognition was unlawful and ordered the Respondent to recognize and bargain with the Union as the continuing majority representative of unit employees.  The Board relied on Goya I in rejecting the Respondent?s argument in the present case that it had no general statutory obligation to bargain.

The Respondent also contended that it had no obligation to bargain about changes in route and store assignments because such changes were consistent with an alleged past practice of maintaining a dynamic status quo in which the stores assigned to sales employees and drivers varied daily.  The Board rejected the same argument in Goya I, finding that the Respondent relied on ?an historic right to act unilaterally, as distinct from an established practice of doing so . . . . [T]hat right to exercise sole discretion changed once the Union became the certified representative.?  347 NLRB No. 103, slip op. at 3.  The Board relied on this rationale in finding similar unilateral change violations in Goya Foods of Florida, 350 NLRB No. 74 (2007)(Goya II) and did so again in the present case in finding that changes in routes, wages, and hours resulting from implementation of the Roadnet program and the reassignment of stores on a discharged driver?s route violated Section 8(a)(5).  Reversing the judge in finding the latter violation, the Board stated that the judge mischaracterized the issue as involving an employer?s right to take action as a temporary expedient to meet the next day?s delivery demands.  Instead, the Board found that the issue involved the permanent or long-term reassignment of stores on the discharged driver?s route and, as in similar reassignment situations litigated in Goya I, the Respondent failed to meet its obligation to bargain before making those changes.

In reversing the judge?s recommended dismissal of the allegation that the Respondent?s implementation of a new inspection procedure for refused goods, the Board disagreed with the judge that the change had a de minimus effect on bargaining unit drivers.  The Board emphasized that the Respondent?s new requirement that drivers sign to verify the accuracy of the refused goods inspection formalized drivers? responsibility and created the potential of discipline for failing to follow the new procedure.  As such, the change was substantial and material, triggering the Respondent?s obligation to bargain with the Union prior to imposing the new inspection procedure.

The Board ordered the Respondent to rescind the unlawfully implemented inspection procedure.  In light of the fact that the decision to implement the new Roadnet program companywide preceded the Union?s certification, the Board agreed with the judge that the Respondent should not be ordered to rescind its use of that program, although the Respondent will have to bargain about its effects on bargaining unit drivers.  However, the Board disagreed with the judge that no remedial backpay remedy was warranted for the Roadnet violation.  It ordered the Respondent to make whole the drivers for any losses resulting from the implementation of Roadnet.

As in Goya II, the Board rejected the Respondent?s contentions the General Counsel engaged in impermissible relitigation or piecemeal litigation of various allegations in this proceeding and that the judge erred by issuing a decision before the Board issued its decision in Goya I.

(Members Liebman, Schaumber, and Kirsanow participated.)

            Charges filed by UNITE HERE; complaint alleged violation of Section 8(a)(1), (3), and (5).  Hearing at Miami, Nov. 8, 9, and 13, 2001.  Adm. Law Judge Raymond P. Green issued his decision July 2, 2004.

***

Hacienda Hotel, Inc. Gaming Corp., d/b/a Hacienda Resort Hotel & Casino (28-CA-13274, 13275; 351 NLRB No. 32 ) Las Vegas, NV Sept. 29, 2007.
http://www.nlrb.gov/shared_files/Board%20Decisions/351/v35132.htm

The Board accepted the remand of the U.S. Court of Appeals for the Ninth Circuit (Local Joint Executive Board of Las Vegas, Culinary Workers Union Local 226 v. NLRB, 309 F.3d 578 (9^th Cir. 2002)), as the law of the case in concluding that the Respondents did not violate Section 8(a)(5) and (1) of the Act by unilaterally ceasing dues checkoff after the parties' collective-bargaining agreements expired.  The Board based its finding on the particular circumstances of this case, in which the dues-checkoff clauses in the parties' collective-bargaining agreements contained explicit language limiting the Respondents' dues-checkoff obligation to the duration of the agreements.

In its initial decision, 331 NLRB 665, issued on July 7, 2000, the Board affirmed the administrative law judge?s decision that the Respondents had not violated the Act by unilaterally ceasing dues checkoff.  The judge reasoned that the dues-checkoff provisions contained explicit language, which limited the Respondents? dues-checkoff obligation to the duration of the agreements.  The Board, however, relied on a different rationale based on "well-established precedent that an employer's obligation to continue a dues-checkoff arrangement expires with the contract that created the obligation," citing Bethlehem Steel Co., 136 NLRB 1500, 1502 (1962), remanded on other grounds sub nom. Marine & Shipbuilding Workers v. NLRB, 320 F.2d 615 (3d Cir. 1963), cert. denied 375 U.S. 984 (1964), and its progeny.

In vacating the Board?s earlier Decision and Order, the court concluded that it was ?unable to discern the Board?s rationale for excluding dues-checkoff from the unilateral change doctrine in the absence of union security,? and, therefore, the court did ?not reach the question whether such a rule would be ?rational and consistent? with the Act and therefore entitled to deference.?  Therefore, the court remanded the case to the Board with instructions to articulate a reasoned explanation for its decision, whether the Board decides to reaffirm its earlier decision or adopt a different rule.

Chairman Battista concurred in the Board?s newly articulated rationale, agreeing with his colleagues and the judge that the language of the dues checkoff clause specifically made clear that its duration was coterminous with that of the collective-bargaining agreement.  He noted his view that this rationale is further supported by the alternate rationale in the Third?s Circuit?s opinion enforcing the Board?s decision in Bethlehem Steel Co., supra.  Chairman Battista wrote separately to convey his view that even if the parties, unlike here, fail to express this intention in their collective-bargaining agreement, he would include dues checkoff among the class of mandatory subjects that are excluded from the unilateral change doctrine under Katz, i.e., which do not survive contract expiration.  He reasoned that dues checkoff is a form of economic weaponry, albeit milder than a lockout, whereby the Respondent cuts off the automatic flow of funds in order to persuade the Union to agree with the Respondent on outstanding contract issues.

Members Liebman and Walsh dissented, rejecting the majority?s position for the reasons stated in the original dissent.  They found that as a general matter, dues check-off survives contract expiration, and the Respondent violated Section 8(a)(5) and (1) by unilaterally ceasing to honor employees? dues-checkoff authorizations following expiration of the collective-bargaining agreements, notwithstanding the contract language relied on by the majority.  The dissent rejected the majority?s approach, stating that it ?would effectively drain the Katz doctrine of any force.?  The dissent also rejected Chairman Battista?s economic weapon theory, stating that ?rather than justifying a principled exception to Katz, his logic would vitiate the policy altogether.?  Chairman Battista countered the dissent, stating ?That fear is unfounded.  The rationale of Indiana & Michigan Electric, on which I rely to exclude dues checkoff from the Katz doctrine, would be applicable to very few other terms and conditions of employment.?

(Full Board participated.)

***

Jones Plastic & Engineering Co. (26-CA-20861; 351 NLRB No. 11) Camden, TN Sept. 27, 2007.
http://www.nlrb.gov/shared_files/Board%20Decisions/351/v35111.htm

The Board announced that at-will employment status does not detract from an employer?s otherwise valid showing that it has permanently replaced striking employees.  The Board overruled Target Rock, 324 NLRB 373, 374 (1997), enfd. 172 F.3d 921 (D.C. Cir. 1998), to the extent it is inconsistent with that principle.

            An economic striker who unconditionally offers to return to work is entitled to immediate reinstatement unless the employer has hired a permanent replacement for the striker in order to continue its business operations during the strike. Mackay Radio & Telegraph Co. v. NLRB, 304 U.S. 333, 345-346 (1938).  Thus, at the conclusion of a strike, an employer is not bound to discharge those hired permanently to fill the places of economic strikers, but permanent replacement status is an affirmative defense, with the burden on the employer to show a mutual understanding with the replacements that they are permanent.

Many employers hire employees on an ?at-will? basis, meaning that they can be discharged at any time, with or without cause.  In Target Rock, the Board opined that statements advising replacement employees of their at-will status ?obviously do not support the [r]espondent?s position that the striker replacements were permanent.?  In Jones Plastic, the General Counsel asserted that because Target Rock could be read to deprive at-will replacement employees of permanent status, the law should be changed to make clear that at-will employment does not foreclose a finding of permanent replacement status.

A Board majority (Chairman Battista and Members Schaumber and Kirsanow) concluded that at-will employment status does not detract from permanent replacement status, stating that

we view as untenable any implication in Target Rock that conditions on hiring other than those enumerated in Belknap detract from a finding of permanent replacement status.  Instead, we find that the status of the replacements hired by the Respondent in this case is indistinguishable from the status of probationary employees found to be permanent replacements in Kansas Milling, [97 NLRB 219, 225-226 (1951)], and its progeny.  In those cases, the probationary employees were subject to discharge without cause, and their post-probation employment was subject to their satisfaction

Full post as published by NLRB Law Memo on October 12, 2007 (boomark / email).

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