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THREE-YEAR REPORT BY WILLIAM B. GOULD IV, CHAIRMAN, NATIONAL LABOR RELATIONS BOARD

NATIONAL LABOR RELATIONS BOARD
WASHINGTON, D.C.   20570

FOR IMMEDIATE RELEASE (R-2202)
Friday, March 7, 1997 202/273-1991

IN 3-YEAR REPORT, NLRB CHAIRMAN GOULD ASSESSES AGENCY DECISIONS, INITIATIVES; SEES PROGRESS IN LABOR RELATIONS ENVIRONMENT

National Labor Relations Board Chairman William B. Gould IV said he believes the decisions the Board has issued and the initiatives it has implemented during the past three years have improved U.S. labor-relations by better balancing the competing interests of labor and management and by streamlining administrative procedures.

In a three-year report released today by Chairman Gould on the third anniversary of his appointment, he said his primary goal has been "to uphold the law impartially, to promote some measure of balance between labor and management, and to bring both sides closer together by fostering a more cooperative environment." Another objective has been to reduce the need for litigation and to simplify and expedite NLRB procedures, he said.

"In the main, the initiatives have been successful - though some aspects of my reforms have met with resistance," Mr. Gould stated. For the remaining 18 months of his term, he said he will continue pursuing his original goals while "reaching for the middle ground -- or vital center, as President Clinton has described it. After all, the NLRB is neither pro-labor, nor pro-employer -- nor should it be."

As an indicator of the Board's impartiality, Chairman Gould pointed out that the Board's decisions during his tenure have been enforced by the U.S. Courts of Appeals in whole or part about 80% of the time, and in the last quarter the enforcement rate was more than 90%.

The NLRB chairman expressed disappointment that the Board's proposed "single unit" rule "became a hostage in the deliberations over our budget" and could not be finalized. He said the proposed rule was intended "to eliminate unnecessary delays and litigation in the traditional case-by-case litigation method" by setting forth the factors it would use in determining the appropriateness of a single location bargaining unit where the employer has more than one facility. A rider prohibiting its implementation was attached to the NLRB's final appropriations bill for FY 1996 and FY 1997.

The report assesses a number of Chairman Gould's initiatives and identifies selected decisions rendered by the Board since March 1994. Among the highlights:

  • While disagreeing with some Board precedent, Chairman Gould stated "my primary focus has been and will continue to be effectively implementing existing law."

  • A "Super Panel" system for processing certain cases has expedited the decisional process. Under this procedure, a panel of three Board Members meets each week to hear cases which involve issues that lend themselves to quick resolution without written analyses by each Board Member's staff.

  • "Speed Teams" are used to reduce the amount of staff time devoted to cases where the Board is adopting recommended decisions of Administrative Law Judges.

  • "Settlement Judges" are assigned in select cases that may lend themselves to quick resolution. Under this procedure, a judge is assigned to a case other than the trial judge to conduct settlement discussions.

  • "Bench Decisions" are permitted in certain cases. The judge notifies the parties early in the process that oral argument will be heard in lieu of briefs. After oral argument, the judge reads the decision into the record and later certifies the transcript that contains the decision.

  • Judges were given time targets for issuing their decisions.

  • The Board increased the use of injunctions under Section 10(j) of the National Labor Relations Act as an effective means of bringing about compliance. Since March 1994, the Board has had a success rate of 88%, including wins and settlements, on a par with or better than the experience of prior Boards.

  • Advisory Panels composed of distinguished labor and management attorneys were formed to provide the Board and General Counsel with practical input from practitioners on a wide range of topics. Six sets of panel meetings have been held to date.

  • The Board was able to reduce its backlog to 397 cases as of the end of FY 1996 - one of the lowest levels in over two decades. By comparison, the backlog in February 1984 was 1,647.

# # #



THREE-YEAR REPORT 1 BY WILLIAM B. GOULD IV, CHAIRMAN, NATIONAL LABOR RELATIONS BOARD

Introduction

Having reached the three-year mark in my term as Chairman of the National Labor Relations Board, I can report considerable progress in carrying out the agency's mission of enforcing the National Labor Relations Act and implementing several new initiatives to make our processes and procedures more efficient.

I. Fostering a More Cooperative Labor-Management Environment

My goals remain the same as when I took the oath of office on March 7, 1994. My primary mission was to uphold the law impartially, to promote some measure of balance between labor and management, to bring both sides closer together by fostering a more cooperative environment -- both through Board procedures and substantive law. I also pledged to workers, union officials and business people that they would be treated with respect, civility and fairness. Finally, I have attempted to reduce the need for litigation and to simplify and expedite NLRB procedures. In the main, these initiatives have been successful -- though some aspects of my reforms have met with resistance.

I stated that I viewed the role of Chairman as most akin to my former role as an impartial arbiter, mediator and fact-finder in both the private and public sector. In both jobs, my role has been to decide cases based upon the facts and relevant law, not to fashion legislation. For over three decades, I arbitrated and mediated more than 200 labor disputes. I would hope that all of my work as an arbitrator -- interpreting collective bargaining agreements, sometimes making recommendations about agreements and sometimes imposing agreements -- has demonstrated a sense of balance and impartiality. And that is what I have tried to bring to bear on my work as Chairman of the NLRB. Though I disagree with some of the Board precedent which emerged in the 1980s and before, my primary focus has been and will continue to be effectively implementing existing law.

II. Enforcement Rate

A reliable baseline indicator of the impartiality of Board decisions is how well they fare upon appeal to the U.S. Courts of Appeals. I am particularly proud that the Board's decisions during my tenure have been enforced by the courts in whole or part about 80% of the time, and in the last quarter the enforcement rate was more than 90%.

Of the 44 court decisions handed down during the period (October - December 1996), the Board prevailed in 93% of contested cases involving review or enforcement of its orders (84% were complete wins, while 9% involved either modification of the Board's order or partial remand). In comparison, the Board's enforcement rate since FY 1990 has averaged 83%. (See Attachment A for a year-by-year breakdown since fiscal year 1990).

III. Supreme Court Review

Similarly, the Supreme Court has accorded deference to NLRB decisions.

The agency argued three cases before the Court during this past Term. In each case the Agency's position was upheld by the Court. In NLRB v. Town & Country, 116 S. Ct. 450 (1995), the Court unanimously held that paid union organizers are "employees" within the meaning of the Act and are, therefore, protected against employer retaliation in the form of discharge or discipline for protected activity. The Court recognized that "the Board often possesses a degree of legal leeway when it interprets its governing statute," but added that "the Board needs very little legal leeway here to convince us of the correctness of its decision." 116 S.Ct. at 453.

In Auciello Iron Works Inc. v. NLRB, 116 S. Ct. 1754 (1996), the Court again unanimously upheld the Board's position and held that an employer may not refuse to bargain with an incumbent union on the ground that it has lost majority status where it has previously entered into a contract with such a union. The Court stated that "the Board's judgment is entitled to prevail. To affirm its rule of decision in this case, indeed, there is no need to invoke the full measure of the 'considerable deference' that the Board is due . . . ." 116 S.Ct. at 1759.

And, third, the Court in Holly Farms Corp. v. NLRB, 116 S. Ct. 1396 (1996), held that some workers involved in chicken processing were "employees" within the meaning of the Act and not excluded by virtue of the agricultural employee exemption contained in the Act. Although Holly Farms was a 5-4 decision -- in contrast to the unanimous holdings of the Court in both Town & Country and Auciello -- the major theme involved in each of these cases is the same. The Court, time and time again, noted the Board's expertise and its policy of granting deference to the expert agency's interpretation of its own statute. See 116 S.Ct. at 1401 and 1406.

In another case during the past Term, Brown, et al. v. Pro Football Inc., 116 S. Ct. 2116 (1996), involving the relationship between antitrust and labor law, the Court sounded the same theme. Here, while concluding that the federal labor law shields football from antitrust liability when the owners act unilaterally subsequent to bargaining to impasse, the Court noted that it could not resolve the ultimate issue of accommodation between the competing statutes until it hears "the detailed views of the Board, to whose 'specialized judgment' Congress 'intended to leave' many of the 'inevitable questions' concerning multi-employer bargaining bound to arise in the future . . . ." 116 S.Ct. at 2127. Again, the Court stressed the central role of the Board and the Court's policy of deference to this agency.

The language employed by the Court, coupled with its holdings, indicate that the Board's credibility with the Court has never been better. And the same is true throughout the entire federal judiciary.

IV. Advisory Panels

One of our first actions after confirmation was to appoint Advisory Panels composed of distinguished labor lawyers -- 26 union labor lawyers and 26 attorneys who represent employers. These panels serve pro bono and meet twice each year to advise the Board and General Counsel on processing and improving agency service to the public. Six sets of advisory panel meetings have been held to date, in June and October 1994, March and November 1995, June 1996 and January 1997. The next meetings are scheduled for October of this year.

My work as a private practitioner representing both management and labor, impartial arbitrator and law professor, has made me sensitive to the importance of providing opinion makers in this field with direct input in devising solutions to the practical problems involved in labor litigation and negotiations. My judgment is that we have been well informed and advised by the individuals on our Advisory Panels who confront day-to-day real life problems in the field. By the same token, these distinguished practitioners have gained insights into the problems that we face as an independent quasi-judicial agency.

We have discussed a wide range of topics, including proposals put forward in the House of Representatives for indexing the NLRB's jurisdictional standards for inflation and the agency's efforts to reinvent and streamline its operations. With almost complete unanimity, the panels -- both union and management lawyers -- stated their skepticism about the value of indexing the agency's jurisdictional standards to the CPI without the benefit of Congressional hearings and research on the impact of this proposal. Moreover, both labor and management lawyers expressed considerable concern about the inability of either side to have any rights or remedies under an indexing formula if it were to deprive the NLRB of jurisdiction over a substantial number of employers and their employees. Such a consensus on both sides of the bargaining table about policy issues is unusual, indeed.

A third topic was the proposal in the Congress to merge NLRB Administrative Law Judges into a government-wide ALJ corps along with Social Security judges and those of other agencies. The management and union advisory panels both agreed that this would be a mistake because the expertise of NLRB judges in labor law would be diluted and eventually lost. The ALJ corps legislation died in the waning days of the 104th Congress.

The Advisory Panels have provided a valuable sounding board on various policy issues and a link to the labor law bar and our constituents in labor and industry. Other early Board proposals discussed with the panels included proposed Administrative Law Judge reforms which met with initial skepticism from both the union and management panels in 1995 but had gained wide support by the completion of a trial period in 1996.

V. "Super Panel" System

In November l996 the Board implemented an experimental "Super Panel" system for processing certain cases carefully pre-selected by the Executive Secretary. The procedure was recommended by the agency's Joint Labor-Management Partnership.

Under the procedure, a panel of three Board Members meets each week to hear cases which involve issues which lend themselves to quick resolution without written analyses by each Board Member's staff. Most of the cases are resolved unanimously based on straightforward application of settled Board precedent. The occasional case submitted to the Super Panel that presents issues that are not susceptible to resolution by the Super Panel is referred to the regular case procedure for further analysis and briefing by Board and Office of Representation Appeals staffs.

Since the procedure was implemented on November 5, l996, of the 78 cases referred to the Super Panel 67 were resolved unanimously, nine with a dissent, and two were not resolved. This innovative procedure was used to quickly resolve more than one-third of the representation cases, including requests for review, received during the period since it was adopted last November.

The primary advantage of the Super Panel procedure is the speed with which the issues are resolved, sometimes only a few days after an appeal is filed. This avoids delays in conducting representation elections. Also, by providing for direct participation by each Board Member on the Super Panel at the outset of each case, staff time for analysis and writing is saved. Only one staff attorney, rather than one for each Board Member reviews each case, researches the issues, and presents his or her analysis and recommendations orally to the Super Panel. Of course, many cases are more complex and do not lend themselves to the expedited procedure. The success of the Super Panel process, thus, depends on the ability of the Office of Representation Appeals and of the Office of the Executive Secretary to quickly identify the cases that are good candidates for disposition by the Super Panel. Analysis of the cases by each Board Member in advance of the Super Panel meetings also is crucial.

Nearly all of the cases decided by the Super Panel to date have been representation cases. However, on March 3 the Board agreed to use the system for carefully selected unfair labor practice ("C") cases on a trial basis.

VI. Speed Teams

In another initiative to expedite the resolution of cases, in December 1994, the Board adopted a "speed team" case handling process which has reduced the amount of staff time devoted to cases where the Board is adopting recommended decisions of Administrative Law Judges.

In a speed team case, the issues are presented orally to a Board Member and, after discussion, a written decision is prepared within a matter of days so that the Board Member can approve the written decision while the case is still fresh in the Board Member's mind. This procedure eliminates the preparation of duplicative and unnecessary documents in cases which are essentially factual where credibility determinations already have been made -- either by an Administrative Law Judge in an unfair labor practice hearing, or by a Hearing Officer in a dispute arising out of a representation proceeding. The key to the effectiveness of the speed team procedure is direct and active involvement of the participating Board Member.

We have used the speed team case handling method in more than 510 cases (about 30 percent of total cases) with great success in speeding up our decisional process. During FY 1996, 25 percent of all C cases and 48 percent of all R cases were handled through the speed team process. The result has been reflected in our ability to decrease, by approximately 20 percent, the processing time for cases coming to the Board for decision. For fiscal year 1993, for instance, the median time for processing of unfair labor practice (C) cases from assignment to issuance was 104 days, and the corresponding median for representation (R) cases was 106 days. For fiscal year 1996 the comparable medians dropped to 84 days both for C and R cases.

The speed team procedure, and an active meeting schedule, have allowed the Board to move with unprecedented dispatch. From March 1994 through this date we held 80 full Board meetings -- in contrast to 42 meetings held by our predecessors during the same period of time immediately prior to my arrival in Washington, D.C. (This is in addition to nine oral arguments and the 12 Advisory Panel meetings. This activity of the Board is unprecedented in scope and frequency.)

VII. Case Inventory

All of this has enabled the Board to reduce its backlog to 397 cases as of the end of FY 1996 -- one of the lowest levels in over two decades. A range of 400 to 600 cases historically has been considered a normal case inventory. My sense is that we would have an even better record which could rival the records of earlier Boards before 1974, if the shutdowns and the disruption that ensued in their wake had not slowed the processing of cases. In any event, the present and historically low backlog stands in sharp contrast to the high-water mark of 1,647 cases in February 1984.

VIII. New Administrative Law Judge Procedures

We are making progress at simplifying NLRB procedures so that the parties have clear guidance, the expenses entailed by extensive litigation are minimized, and case processing is expedited. On February 1, 1995, the Board announced a one-year trial period to experiment with revised Administrative Law Judge procedures designed to resolve disputes quickly, informally and early in the administrative process to avoid long and costly litigation, hearings and appeals. Favorable results from the new procedures led the Board to make them permanent effective March 1, 1996.

A. Settlement Judges

Under the Board's settlement judge rule, the Chief Administrative Law Judge, or the appropriate Associate Chief Judge, may assign a settlement judge "who shall be other than the trial judge to conduct settlement negotiations," provided that all parties agree to the procedure. The rule provides that, "where feasible, settlement conferences shall be held in person," and settlement negotiations "shall not unduly delay the hearing." The rule also provides that all discussions between the parties and the settlement judge "shall be confidential." Any settlements reached under the auspices of a settlement judge are subject to the approval of the Regional Director prior to the opening of the hearing or of the trial judge after the hearing has opened.

Since the settlement judge rule went into effect in February 1995, we have secured settlements in a little more than two-thirds of our settlement judge efforts. Through December 1996, we assigned settlement judges in 189 cases; settlements were achieved in 129 of those cases, some after a trial judge was assigned and made further settlement efforts. In FY 1996 approximately nine percent of all Administrative Law Judge cases were resolved by settlement judges.

We generally honor requests by parties for the appointment of a settlement judge, assuming that all parties agree, but most settlement judge efforts are at the initiative of one of the chief judges and most are conducted by telephone. We schedule on-site conferences when the proposed settlement case can be linked with regularly scheduled trials or other settlement efforts. We also occasionally schedule a single case for settlement conference when the case is of such magnitude to warrant sending out a judge solely for that purpose. In fiscal 1996, despite budget constraints, we held 26 on-site settlement judge conferences, 12 of which resulted in settlements, including some in cases with trial estimates of two weeks or more.

B. Bench Decisions

In a rule change first implemented on a trial basis in February 1995 and made final on March 1, 1996, Administrative Law Judges were given the authority to issue bench decisions. The judge first notifies the parties "at the opening of the hearing, or as soon thereafter as practicable, that he or she may wish to hear oral argument in lieu of briefs." After oral argument, the judge reads the decision into the record, and, when the transcript is received, issues a written certification of the transcript that contains the decision, along with any additional discussion and any necessary order and notice. The case is transferred to the Board and the time for exceptions begins to run upon service of the written certification on the parties.

From February 1995 through February 1997, ALJs issued 40 bench decisions. (See Attachment B for a breakdown of bench decisions by type of violation.) In fiscal 1996, bench decisions represented about 4.5% of the total decisions issued by judges. Some 20 different judges have issued bench decisions. Most of the cases in which bench decisions were issued were one-day hearings and involved relatively simple credibility issues.

Most of the bench decisions were not appealed and were adopted, in the absence of exceptions, by the Board. Only 13 were appealed. Eight resulted in reported Board decisions, (most were short-form adoptions) and five bench decisions are pending review by the Board.

Board action on bench decisions included one partial remand and one partial reversal. In the latter case, the Board, in a footnote, cautioned that "[a]lthough judges have the authority to issue bench decisions . . . such decisions, like written decisions, must be well-considered and supported." Pacific Maritime Association, 321 NLRB No. 116 (Slip op. p. 2, note 4) (1996).

None of the bench decisions affirmed by the Board have been reviewed in the court of appeals, although an enforcement petition has been filed and is pending in one of the cases. It does not appear that any party has made a serious procedural attack on the bench decision rule in any of the cases thus far decided under the rule.

With the one possible exception cited above, it appears that judges have chosen wisely those cases that warranted bench decisions. Not only has the bench decision rule saved time on Board review, but the bench decisions are themselves issued, on average, some three or four months earlier than they would have issued after full briefing and a full written exposition.

C. Time Targets

In a separate action, in September 1994, the Board began phasing in time targets for Administrative Law Judges designed to reduce the time used for issuing their decisions. The targets became fully effective in May 1995. The results are encouraging thus far. The median number of days from hearing to decision has dropped from 138 in 1993 to 128 in 1994 to 114 in 1995 and to 111 in 1996. The median time from when briefs are filed to decision decreased from 83 days to 71 to 64 and to 62 days in the same period. We are also finding that the cases that do go to trial and require written decisions are longer and more complex than in the past. The average transcript length in cases in which judges' decisions issued in FY 1996 was 603 pages; in FY 1995 that figure was 519 pages.

D. Increase in Settlements

Overall, our Administrative Law Judges issued 442 decisions and obtained 725 settlements in FY 1996, a 13 percent increase over FY 1995. This significant increase reflects the heightened emphasis the Board has placed on settling cases wherever possible, in order to save the agency and taxpayers a great deal in litigation costs and ensure that the parties themselves avoid the delays and cost inherent in the formal trial process and subsequent consideration by the Board and Courts of Appeals.

E. Number of Judges Declining

All of this has been accomplished with a diminishing number of Administrative Law Judges, which has been reduced to a historic low by retirements and other attrition. In November 1993 the agency employed 78 judges as compared to 62 today. (The high point was 117 in 1981).

IX. Usage of 10(j) Injunctions Increased

During my tenure, the Board's use of l0(j) injunctions has increased as a means of quickly putting a stop to certain violations of the Act by employers or unions and to provide an incentive to voluntary compliance.

In the first full year of the new Board's term, March 1994 to March 1995, 126 injunctions were authorized. This represented a substantial increase over the number of injunctions authorized by our predecessors. For example, in fiscal year 1993, the prior Board authorized 42 injunctions and in fiscal year 1992, only 26 injunctions. Since March 1994, the Board has authorized 237 10(j) injunctions and denied authorization in 12 cases or 5% of all cases. I voted against 10(j) authorization in those 12 cases and two other cases in which I dissented while the Board granted authorization. (See Attachment C for a breakdown of injunction activity since March 1994.) This increase in the use of injunctions has sent a message both to employers and unions that the Board is prepared to take prompt and effective action against violations of the Act in which the passage of time would render Board remedies ineffective. Of the cases pursued to a conclusion by the General Counsel since March 1994, the agency has had a success rate of approximately 88%, including both wins and settlements, on a par with or better than the experience of prior Boards.

One of the highlights of my tenure to date was participating in the Board's March 26, 1995 decision to seek injunctive relief against unfair labor practices by Major League Baseball teams. The agency played a decisive role in saving both the 1995 and 1996 seasons and creating an environment in which a comprehensive collective bargaining agreement could be negotiated in November 1996.

Finally, I would note that in connection with one 10(j) case, I was of the opinion that the Board should permit the parties to present oral argument as the employer had proposed. A majority of the Board, however, voted against the motion.

X. Contempt Actions

The Board has not hesitated to authorize contempt actions against recalcitrant employers and unions absent meaningful settlement discussions. Since March 1994, the Board has authorized the General Counsel to institute contempt proceedings in 31 cases against employers and in two cases against unions.

With respect to the union cases, both cases settled pursuant to consent orders. I voted to authorize contempt in both cases (and to disapprove one of the resulting settlements), as I did in all the employer cases.

Several of the cases against employers had especially good outcomes in that, after the cases were settled, the union and employers reached agreement on collective bargaining contracts and no further difficulties under the Act subsequently have come to the Board's attention.

XI. Mail Postal Ballot Procedures Improved

One of the early procedural improvements addressed by the Board was increasing the use of mail ballots in situations where conditions are such that costs would be lower and/or employee participation would by higher by using this procedure.

The Board also has encouraged greater use of mail ballots through its decisions and, as a result, the agency conducts about twice as many elections by mail ballot as it had under previous administrations. An important ingredient in this process has been the development of better mail ballot procedures.

Of course, the overwhelming number of secret ballot elections are held manually in the workplace of employees as has been the historic practice. There has been no intent to change this time-honored practice, but rather to employ mail ballots in situations where workers would not have the opportunity to cast their ballot and thus participate in the electoral process or where the Agency's pressed financial circumstances would be unduly burdened. Thus, we conduct representation elections by mail ballot only when it is cost effective, practical and consistent with the purpose of the Act. The agency's use of mail ballots has been approved by the courts in several cases.

XII. Single Unit Rule

In September 1995, the Board proposed a rule setting forth the factors it proposed to use in determining the appropriateness of a single location bargaining unit where the employer has more than one facility. The rule is designed to apply to all routine cases in which the issue is whether a petitioned-for unit of unrepresented employees at a single location is an appropriate bargaining unit.

The goal of the single unit rule is to eliminate the unnecessary delays and litigation in the traditional case-by-case litigation method. Under the current procedure, each union election petition for a single unit in a multiple-unit employer may be litigated by the parties with delay and needless cost to all, including the taxpayer, even though the circumstances are substantially identical to ones ruled on by the Board countless times over the years in previous cases.

The proposed rule, which has not been acted on by the Board, would set forth, clearly and simply for the public and labor bar, the factors the Board would find critical in most single location cases.

Because of the propagation of misinformation about it, the single unit rule has been met with opposition from employer groups and in the Congress. The proposed rule -- which was designed not to change the law nor advantage either unions or employers, but to save time and money for the agency and for the parties 2 -- became a hostage in the deliberations over our budget. A rider prohibiting its implementation was attached to the agency's final appropriations bill for FY 1996 and FY 1997.

XIII. Decisional Highlights

The genius of the National Labor Relations Act is that it provides a legal framework for industrial relations designed to keep government out of the workplace, leaving most problems to resolution by the parties who are best equipped to solve them using the kinds of creative means preferred by those most directly affected. This is the antithesis of a "made in Washington, one size fits all" process.

We want the parties to rely upon their own resources using the creativity and spontaneity which the Act itself promotes. This is the overriding view of most of the Board majorities set forth in the cases in which I have participated. It is my commitment to continue to provide -- as I indicated to the Senate Labor and Human Resources Committee at my confirmation hearing -- a presumption in favor of stare decisis until my term expires.

I think that our decisions these past three years reflect a balance and consideration for the competing interests of labor, management, and individuals, as well as a commitment to the practice and procedure of collective bargaining and the promotion of voluntarily negotiated procedures by the parties. After all, this is the fundamental thesis underlying our decisions as well as our use of Section 10(j) preliminary injunctions and the rulemaking process.

(See Attachment D for a discussion of selected decisions rendered since March of 1994.)

XIV. Conclusion

My objective behind the initiatives we have implemented and with the decisions we have issued is to advance more constructive, cooperative, harmonious labor-management relations in the United States. I am hopeful that we will be successful in reaching the middle ground -- or "vital center," as President Clinton has described it. After all, the NLRB is neither pro-labor, nor pro-employer -- nor should it be.

For the remaining 18 months of my term -- and consistent with my approach these past three years (indeed, as it has been over the three decades I have worked in this field) -- I will seek that "vital center" and continue to restore the public's confidence in the NLRB's mission of impartiality and neutrality.

# # #


Attachment A

ENFORCEMENT RATES
FY 1990 Through First Quarter of FY 1997

 

Year Full Enforcement Partial Enforcement Total
1990 78.9 9.9 88.8
1991 76.4 10.1 86.5
1992 73.3 10.6 83.9
1993 78.2 10.6 88.8
1994 62.7 16.2 78.9
1995 60.8 11.7 72.5
1996 65.8 18.1 83.9
1990-96 avg. 71 12 83
1997--1ST QTR 84 9 93

Attachment B

BREAKDOWN OF BENCH DECISIONS
BY TYPE OF VIOLATION

 

Violation Alleged No.
8(a)(1) 5
8(a)(1) and (2) 1
8(a)(1) and (3) 16
8(a)(1), (3), and (4) 0
8(a)(1) and (4) 1
8(a)(1) and (5) 10
8(a)(1), (3) and (5) 2
8(a)(1)(A) 2
8(b)(1)(A) and 8(b)(2) 1
8(b)(2) 0
Backpay/Compliance 1
Other 1

Attachment C

BOARD DISPOSITION OF 10(j) INJUNCTION CASES SINCE MARCH 1994

 

Authorized Less pndg & w/d Win Loss Settled/Adj Success Rate Win Rate
FY 94 MAR-OCT 65 58 23 10 25 83% 70%
FY 95 104 98 39 9 50 91% 81%
FY 96 54 52 20 6 26 88% 77%
FY 97 14 6 2 1 3 83% 67%
Total 237 214 84 26 104 88% 76%

Attachment D

SELECTED CASES ISSUED DURING CHAIRMAN GOULD'S TENURE

Representation Cases and Organizational Activities

In Sunrise Rehabilitation Hospital, 320 NLRB 212 (December 19, 1995), the Board held that monetary payments, that are offered to employees by unions or employers, as a reward for coming to a Board election, and that exceed reimbursement for actual transportation expenses, amount to a benefit "that reasonably tends to influence the election outcome." Accordingly, the Board overruled established precedent.3 It noted that the standard for whether the offer of pay or monetary benefits is objective and not subjective, i.e., ". . . whether the challenged conduct has a reasonable tendency to influence the election outcome." It further stated that it takes into account, ". . . such factors as the size of the benefit in relation to its stated legitimate purpose, the number of employees receiving it, how the employees would reasonably construe the purpose given the context of the offer, and its timing."

On the other hand, in Good Shepherd Home, 321 NLRB No. 56 (May 31, 1996), the Board found that a good faith payment designed to reimburse for transportation expenses is not objectionable. Said the majority: 4 "As long as the reimbursement is clearly related only to actual travel expenses, and the party has made a good faith effort to estimate those expenses, we will conclude that the party has not engaged in objectionable conduct."

In Kalin Construction Company, Inc., 321 NLRB No. 94 (July 8, 1996), the Board adopted a new rule, similar to the anti-captive audience approach endorsed four decades ago prohibiting eleventh-hour captive audience speeches in Peerless Plywood 5 by prohibiting other forms of last minute campaign tactics. In this case employees could only gain access to the voting area by entering through an area where, contrary to past practice, the company handed them their pay envelopes. Here each employee received two checks for the pay period whereas in the past one paycheck per pay period had been issued. One was for the amount the employer claimed the employees would receive under union representation. The other was for the amount the employer claimed would be sent to the union.

In Kalin the Board concluded that because last minute campaign speeches and electioneering and changes in the paycheck process have an unsettling impact on employees and disturbed the laboratory conditions which are a prerequisite for a fair election, a change in the paycheck, paycheck distribution, the location or method of the paycheck distribution would be a basis for setting the election aside. It noted that if a change in the paycheck process was motivated by a "legitimate business reason unrelated to the election" the new rule would not be violated. The Board sounded a theme that is similar to much that they have done elsewhere, i.e., an additional virtue of this approach was that it was both understandable and predictable and, therefore, would be less likely to give rise to ". . . extensive litigation, delay, and rulings that are difficult to reconcile."

Another important issue involving organizational tactics arose in Novotel New York, 321 NLRB No. 93 (July 8, 1996), where a union commenced an organizational drive among hotel workers in the midst of complaints about alleged irregularities involving the payment of overtime wages to the workers. A suit alleging violations of the Fair Labor Standards Act of 1938 was filed in Federal District Court by the union, which was represented by outside counsel. Consent forms were signed and filed. The issue presented was whether the union's litigation was a "benefit" which interfered with the conduct of the election.

In Novotel the Board noted that, historically, unions had undertaken a wide variety of actions and tactics to protect and advance the rights of workers. Assessing a wide variety of subjects with which unions have been concerned, it observed that unions have used training programs, litigation, and the advocacy and monitoring of legislation to advance their goals.

The Board noted the freedom of association cases in which the United States Supreme Court held that First Amendment protection applies to advocacy which sometimes takes place in the context of litigation. It held that constitutional and statutory precedent provided protection for both members and non-members in an organizational campaign and that protection was not removed ". . . the moment the union took the next logical step and sought financially or otherwise to assist non-members in gaining access to the Courts for vindication of their lawful rights." The major employer argument in Novotel was that, notwithstanding the protection afforded employees, the result of litigation by the union was an objectionable grant of benefit which would warrant setting the election aside. Said the Board:

[W]e would be standing the statute on its head if we were to set the election aside on the ground that the legal services [provided by the union to] . . . employees were a 'financial benefit to which they would otherwise not be entitled' . . . . Because the Act protects the Petitioner's conduct, we conclude that the legal services it provided Novotel employees were a benefit to which they were entitled under national labor policy." 6

The Board noted the employees' lack of familiarity with the legal process and remedies, and their lack of financial resources. It observed that resorting to the judicial process might well have been "fruitless" without union assistance. Said the Board: "The Petitioner here did precisely what the Act intended labor organizations to do: it aided employees engaged in concerted activity."

Employees and Community of Interest

In PECO Energy Company, 322 NLRB No. 197 (February 14, 1997), the Board held that the general rule in favor of system wide units of public utilities does not operate as an absolute prohibition of smaller units. In this case, the Board stressed that PECO through its own reorganization had identified the power generation group as a well-defined administrative segment of the organization that could justify a smaller than system-wide unit. The Board found the same to be true of the nuclear generation group.

In Speedrack Products Group Limited, 320 NLRB 627 (December 29, 1995), the employer had an agreement with the Alabama Department of Corrections to employ prison inmates who would participate in a community based work release program that allows "free world" employment in a regular job just before the prisoner completes his sentence and is released on parole. The majority found that such workers could not be included in the same unit with so-called "free world" employees. Chairman Gould wrote a concurring and dissenting opinion. The Chairman concluded that any policy, such as that utilized by the Department of Corrections, which prohibits employees from joining unions is preempted inasmuch as state laws seek to prohibit that which federal law explicitly protects. Accordingly, he found no basis for excluding such employees from a bargaining unit and held that challenges to their ballots cast at a representational election should be overruled.

The supervisory status of charge nurses employed in hospitals and nursing homes has spawned considerable litigation and, indeed, has been the subject of controversy at the Board for years.7 In two lead cases, on the basis of the evidence presented in each case, the Board found that disputed charge nurses were not statutory supervisors within the meaning of the Act. In Providence Hospital, 320 NLRB 717 (January 3, 1996), the Board stated that the record evidence did not establish that charge nurses' assignments of registered nurses was anything more than a routine clerical task and that their direction of employees did not require the use of independent judgment within the meaning of Section 2(11) The Board noted that while the charge nurses exercised considerable judgment in assessing patients' conditions and treatment, this was a part of their professional judgment shared by all staff registered nurses. Similarly, in Ten Broeck Commons, 320 NLRB 806 (February 2, 1996), the Board held that licensed practical nurses serving as charge nurses in a nursing home were not statutory supervisors. Again, in connection with assignment and direction, the question was whether the direction required the use of independent judgment or involved directions which were merely routine.

Procedures in Representation Cases

In Bennett Industries Inc., 313 NLRB 1363 (June 3, 1994), a unanimous Board held that where an employer did not take a position about an issue in dispute in a representation hearing, the Hearing Officer properly refused to allow the employer to introduce evidence as to that issue and, further, that it would be inappropriate to permit relitigation of the same issue to the challenged ballot process. Said the Board:

[I]n order to effectuate the purposes of the Act through expeditiously providing for a representation election, the Board should seek to narrow the issues and limit its investigation to areas in dispute.

In another early decision, North Macon Health Care Facility, 315 NLRB 359 (October 26, 1994), the Board held that the full names of employees and not merely their initials must be provided with the so-called Excelsior list of names and addresses provided for employees within seven days of the Regional Director's order of election. The Board came to this conclusion because of the need to provide the electorate with a better informed and reasonable choice from both the union and the employer.

And in Angelica Healthcare Services Group, Inc., 315 NLRB 1320 (January 18, 1995), a unanimous Board held that a hearing in some form is required prior to the time that the election takes place. From a policy perspective, the Chairman's view is that employees should have ballots in most instances before a hearing so that representation matters may be resolved expeditiously and so that the electorate does not lose faith in the prompt delivery of the protections provided by the Act. But under the statute, a "hearing" is required -- although it was not addressed in Angelica precisely how one would define a hearing.

The Board again considered the proper scope of a representation hearing in Heartshare Human Services, 320 NLRB 1 (December 13, 1995). There, the Board denied review of a Regional Director's refusal to allow the employer to relitigate the appropriateness of a single facility unit, where that same issue was litigated at length only about one month earlier in another proceeding involving a different facility of the employer's. In both proceedings, the employer asserted that only a multi-facility, employer-wide unit was appropriate. The Board agreed with the Regional Director that, in these circumstances, the employer properly was limited to introducing evidence of changed circumstances, and could not introduce evidence that was or could have been produced at the prior hearing.

More recently, in Mariah, Inc., 322 NLRB No. 114 (November 25, 1996), the Board emphasized that the role of a hearing officer in a representation proceeding is to ensure a record that is concise as well as complete. In Mariah, the Board found that the hearing officer correctly exercised her authority to exclude irrelevant evidence and to limit a party to an offer of proof.

Another closely related issued is the challenged ballot procedure which the Board has recently discussed with its Advisory Panel. Traditionally, the Board has followed a practice of resolving disputes about voters through the challenged ballot procedure after the vote is taken where no more than ten percent of employees are affected. This is preferable to having extensive litigation which would delay the ballot. In early 1994, shortly after its confirmation by the Senate, the Board proceeded to a ballot where 33 percent of the voters in one unit, and 22 percent of the voters in a second unit, were in dispute. See North County Humane Society, 21-RC-19324, review denied April 14, 1994. The theory behind this approach is that where the numbers of employees in dispute is manageable, it may be unnecessary to resolve such disputes even after the ballot is taken because the numbers may not affect the outcome of the election. This proved the case in one of its 1994 disputes as well as in Columbia Hospital for Women Medical Center, Inc., Case 5-RC-14033, at a time when the anticipated ratio of challenged ballots was 37.5 percent. Similarly in Baltimore Gas & Electric Company, Case 5-RC-14351, the Board went on to an election when 21 percent of the ballots were in dispute. Since the challenged number was 700, the election would have been delayed some period of time -- and again the numbers in dispute were not determinative.

In The Glass Depot, Inc., 318 NLRB 766 (August 25, 1995), a plurality of two members held that whenever a "representative complement" had voted, that acts of nature, such as snowstorms, would not result in a re-run election. Chairman Gould concurred with the result but stated that, as with political elections, the ballot should not be upset because a snowstorm prevented some employees from casting their ballots. An act of nature or a force majeure should be immaterial. Again, the Chairman's concern here and elsewhere is with the uncertainty arising out of the question whether a "representative complement" has voted in every instance of force majeure and the litigation and uncertainty that arises out of such imprecision.

The theme of Chairman Gould's concurring opinion -- and one which is consistent with the handling of representation cases and rulemaking proposals, settlement judge procedures and numerous positions outlined in the Jurisdiction, Voluntary Resolution, and Bargaining Relationships, as well as Employee Participation sections outlined below -- is to promote certainty and avoid wasteful litigation.

In Bishop Mugavero Center, 322 NLRB No. 32 (September 27, 1996), a majority upheld the Regional Director's recommendation that a ballot marked with an "X" in the "No" and a diagonal line in the "Yes" box be considered void and therefore not counted. The majority relied upon "well-established Board precedent" which says that where a voter marks both boxes on a ballot and the voter's intent cannot be ascertained from other markings on the ballot, the ballot is void. Chairman Gould dissented on the ground that the "No" box had a completed mark and that therefore the voter intended to register a "No" vote rather than a "meaningless gesture of indecision."

Postal Ballots

In Shepard Convention Services, Inc., 314 NLRB 689 (August 3, 1994), enf. denied 85 F.3d 671, 152 LRRM 2471 (D.C. Cir. 1996), the Board held that a mail ballot should be provided where it was unlikely that on-call employees would be able to exercise the franchise at the plant facility because of the irregular nature of their work and the fact that they have other employment. The Board held that the Regional Director's failure to provide for a postal ballot was an abuse of discretion.

Again, in early 1994, the Board granted review of a Regional Director's decision which held that postal ballots could not be provided where strikers did not cross the picket line and, indeed, were working out of state -- the Regional Director's decision was based upon the NLRB's Casehandling Manual which does not provide for postal ballots under these circumstances. Lone Star Northwest, Case 36 RD-1434, review granted April 17, 1994.8 Contrary to the Court of Appeals decision in Shepard 9 the Manual is not binding upon the Board -- and it states that it does not constitute a decision of the Board or Board policy. On the other hand, in Willamette Industries, Inc., 322 NLRB No. 151 (January 10, 1997), the Board did not order a mail ballot because "[T]he sole factor cited in favor of a mail ballot, that the employer's facility is approximately 80 miles from the Board's office, alone is insufficient to justify departure from the normal manual election procedure in light of the fact that the unit employees work at a single site." Chairman Gould wrote a concurring opinion because there was nothing in the record from which one could conclude that the ordering of a postal ballot would constitute an efficient use of Board resources. He said: "Presented with the record establishing such a burden, I would conclude that the Acting Regional Director did not abuse his discretion in ordering a postal ballot. But those facts are not presented in this record."

Jurisdiction

In Management Training Corporation, 317 NLRB 131 (July 28, 1995), the Board reversed the so-called ResCare doctrine 10 and established a new test for assertion of jurisdiction over employers who operate pursuant to contracts with government entities. Under the ResCare test, the Board, when confronted with a private sector employer contracting with the public sector which is excluded from the National Labor Relations Act, had examined the control over essential terms and conditions of employment retained by both the private sector employer and government to determine whether the private sector employer was "capable of engaging in meaningful collective bargaining."

In Management Training, the Board found that private employers, whether government contractors or not, are within its jurisdiction. (The statute excludes public employers.) The Board thus rejected the ResCare approach on the ground that it was inconsistent with the statute and that it was both "unworkable and unrealistic" stating that the question of whether there were sufficient matters over which union and employers could bargain was "better left to the parties at the bargaining table and, ultimately, to the employee voters in each case." It noted that the previous doctrine was an oversimplification "of the bargaining process," because it proceeded upon the assumption that economic terms are the most important aspects of the employment relationship even though other matters are negotiated at the bargaining table. Said the Board:

In times of downsizing, recession, low profits, or when economic growth is uncertain or doubtful, economic gains at the bargaining table are minimal at best. Here the focus of negotiations may be upon such matters as job security, job classifications, employer flexibility in assignments, employee involvement or participation and the like. Consequently, in those circumstances, it may be that the parties' primary interest is in the noneconomic area. It was shortsighted, therefore, for the Board to declare that bargaining is meaningless unless it includes the entire range of economic issues.

Similarly, the Board noted that a wide variety of issues such as arbitration, no strike clauses, management rights provisions and issues relating to transfers are often contested between the parties and that to treat them as "inconsequential," as the current Board's predecessors had, "demeans the very bargaining process we are entrusted to protect."

Equally important, the Board noted that such an approach was inconsistent with the so-called "freedom of contract" line of authority of the Supreme Court 11 which has obliged the Board not to regulate, directly or indirectly, the substantive terms that are involved in the collective bargaining process. This is a matter for the parties themselves and not the Board.

In Federal Express Corporation, 317 NLRB 1155 (July 17, 1995), a majority of the Board held that where a party alleges that an employer is excluded from the Board's jurisdiction and covered by the Railway Labor Act, the Board would "continue its practice of referring cases of arguable RLA jurisdiction to the National Mediation Board for an advisory opinion." Chairman Gould dissented and stated that, in his view, the NLRB has an obligation to determine whether a party is within its jurisdiction, and noted that "there is no other instance in which the Board effectively asks another agency to decide the scope of the Board's own jurisdiction." The Chairman also noted that the Board automatically has deferred to decisions of the NMB and thus abdicated its responsibility to another agency to determine the existence of its own jurisdiction. He said that this approach possessed no logical basis and was inconsistent with the exercise of primary jurisdiction articulated by the Court in the landmark case of San Diego Building Trades v. Garmon, 359 U.S. 236, 245 (1959).

In United Parcel Service, Inc., 318 NLRB 778 (August 25, 1995), enfd. 92 F.3d 1221, 153 LRRM 2001 (D.C. Cir. 1996), the Board came to the exact opposite conclusion, grounding its decision to retain jurisdiction on the fact that it historically had exercised jurisdiction over the employer. As the employer in this case noted subsequent to the Board's decision, it made no sense for the Board to abdicate its responsibility in one situation and then, apparently on some basis of a labor law doctrine of hot pursuit, exercise jurisdiction in the other.

Union Access Cases

The Board, in series of 3-2 decisions, has followed the Supreme Court's 1992 decision in Lechmere v. NLRB.12 The Supreme Court's Lechmere decision requires the Board not to make an employer's exclusion of nonemployee organizers where the union is trying to reach the public an unfair labor practice. (In Lechmere they were trying to reach the employees) See Makro Inc. and Renaissance Properties Co., d/b/a Loehmann's Plaza, 316 NLRB 109 (January 25, 1995); Leslie Homes Inc., 316 NLRB 123 (January 25, 1995). Chairman Gould's concurring opinion stressed his disagreement with Lechmere and his obligation to adhere to it as the law of the land and to follow its implications nonetheless. In a series of decisions, however, the Board adhered to Lechmere's retention of the doctrine that discrimination in terms of providing access between different groups serves as a basis for invalidating the employer rule. See, for instance, Riesbeck Food Markets, Inc., 315 NLRB 940 (December 16, 1994); petition for review granted and cross-petitions for enforcement denied, 91 F.3d 132 (4th Cir. 1996); Dow Jones and Company, Inc., 318 NLRB 574 (August 25, 1995). See also Cleveland Real Estate Partners, 316 NLRB 158 (Jan. 27, 1995), enf. denied 95 F.3d 457, 153 LRRM 2338 (6th Cir. 1996), where a Board panel of Members Stephens, Browning and Cohen found that the employer, a privately-owned shopping center, violated 8(a)(1) by preventing non-employee union handbillers from distributing handbills on its property urging customers not to shop at nonunion stores, because the employer knew and permitted other political and charitable groups to solicit and distribute on its property.

Employee Speech

In Caterpillar, Inc., 321 NLRB No. 163 (August 27, 1996), a majority of the Board held, in affirming the Administrative Law Judge, that the employer violated Section 8(a)(1) by prohibiting its employees from displaying various union slogans including a statement, "Permanently Replace Fites" and violated Section 8(a)(3) by enforcing the rule. The Board stated that it agreed with the Administrative Law Judge that the slogan was a response to the employer's stated policy of using permanent replacements rather than an attempt to cause the removal of Fites as the chief executive officer. But, even if they were attempting to remove the chief executive officer, the Board's view was that the conduct was protected.

Chairman Gould concurred in a separate opinion expressing his dissatisfaction with Board and court precedent with respect to employee activity which seeks to influence management policy and its protected status. He said:

[T]he level of managerial policy or hierarchy protested by the union or employees should have little if anything to do with whether such employee activity is protected. Quite obviously, the level at which managerial representatives are involved in employment conditions will vary from company to company. While I am of the view that concerted activity for the purpose of influencing management policy, which is unrelated to employment conditions, is not protected under the Act, the fact of the matter is that the presence or absence of a particular corporate hierarchical structure or internal organization does not provide the appropriate answer to the question of whether employee activity is protected under Section 7 of the Act.

Recognition Disputes

In Caterair International, 322 NLRB No. 11 (August 27, 1996), the Board, subsequent to a remand from the United States Court of Appeals for the District of Columbia,13 reaffirmed its long-standing policy that an affirmative bargaining order is the standard appropriate remedy for the restoration of the status quo after an employer's unlawful withdrawal of recognition from an incumbent union and a subsequent refusal to bargain. The Board held that such an affirmative bargaining order was necessary in order to protect free choice of representation and to avoid a referendum on collective bargaining in the ". . . immediate wake of . . . [the] employer's unlawful refusal to bargain and subsequent, often protracted, litigation resulting from this misconduct."

In Lee Lumber and Building Material Corp., 322 NLRB No. 14 (September 6, 1996), the Board held that some unfair labor practices taint evidence of union's subsequent loss of majority support. Said the Board in Lee Lumber: "[I]n cases involving unfair labor practices other than a general refusal to recognize and bargain, there must be specific proof of a causal relationship between the unfair labor practice and the ensuing events indicating a loss of support. In cases involving an 8(a)(5) refusal to recognize and bargain with an incumbent union, however, the causal relationship between unlawful conduct and subsequent loss of majority support may be presumed."

The Promotion of Voluntary Resolution of Disputes and Diminution of Litigation

In Smith's Food & Drug Centers, Inc., 320 NLRB No. 67 (February 13, 1996), the Board held that an employer's voluntary recognition of one union, the Intervenor, would bar a subsequent petition filed by a union which was not supported by a 30 percent showing of interest at the time of the recognition. A majority of the Board, (Members Browning and Cohen) held that the union may file a valid petition for representation where it has obtained, prior to recognition of the other union, a sufficient number of cards to support the petition, i.e., 30 percent. Chairman Gould concurred with the result, but stated that the Board should refrain whenever possible from involving itself in representation disputes because, "[T]he establishment of a successful collective bargaining relationship is best accomplished by the parties themselves -- the employer, the union, and the unit employees." The Chairman is of the view that clarity, as well as the expeditious resolution of such disputes, is best facilitated by permitting the parties to undertake bargaining without fear of a later challenge by another union. If, of course, the relationship is less than arm's-length and involves unlawful company assistance, the excluded union or disgruntled employees may avail themselves of the Board's unfair labor practice proceedings under Section 8(a)(2). He also expressed the view that the Board was undermining the stability of voluntary recognition and would generate reluctance by employers to do so -- especially when the Board facilitates that objective in unfair labor practice litigation where a union files a Section 8(a)(2) charge based upon such voluntary recognition.

In Douglas-Randall, Inc., 320 NLRB 431 (December 22, 1995), a majority of the Board agreed with the theme that Chairman Gould articulated in Smith's Food & Drug Centers and sustained the dismissal of a decertification petition when a settlement agreement subsequently entered into provided a bargaining provision with the incumbent union. Thus, it facilitated the promotion of both settlements and the collective bargaining process -- the objective that Chairman Gould sought in Smith's Food & Drug Centers.

Bargaining Relationships

In Goodyear Tire & Rubber Company, 322 NLRB No. 183 (January 31, 1997), a majority of the Board, although finding the superseniority clause lawful, adhered to the Dairylea 14 doctrine which declares presumptively unlawful employment status superseniority for union stewards. In a separate concurring opinion, Chairman Gould expressed the view that the rationale of Dairylea should not extend to elected officials. He said, "The prospective steward, . . . is beholden to the employees for their selection, [not the union hierarchy] and thus is encouraged to represent the employees in a manner acceptable to them."

In James Luterbach Construction Co., Inc., 315 NLRB 976 (1994), the Board considered the question of whether the Retail Associates rule applies to the construction industry and Section 8(f) agreements which do not require majority status under the Deklewa decision.15 Chairman Gould agreed with the majority, which included Members Stephens and Cohen, that Retail Associates applies here, and he agreed with the view that in an 8(f) context an affirmative showing is required to bind an individual employer to a multiemployer successor contract. However, the Chairman parted company with them in their requirement that a "distinct affirmative action" to "recommit" to the union was required. He said that the following test comported with the expectations of the parties:

To strike a proper balance between an individual employer's Deklewa rights and the promotion of stability of multiemployer bargaining in the construction industry, I would require an affirmative expression from the association to the union at the beginning of negotiations specifying the individual employers on whose behalf it was negotiating. From that point forward, I would find that the union is entitled to rely on the association's representation, and the individual employer is bound by the results of the multiemployer negotiations.

In Canteen Company, 317 NLRB 1052 (June 30, 1995), enforcement granted, 103 F.3d 1355 (7th Cir. 1997), Chairman Gould joined Members Browning and Truesdale to form a majority, but fashioned a separate concurring opinion positing that, in a successorship situation, an employer may unilaterally set wage rates that were different from those paid by its predecessor under the collective bargaining agreement. The majority agreed that the wage rates were imposed unlawfully without first consulting with the union pursuant to the "perfectly clear" exception in NLRB v. Burns Security Services.16 In his concurring opinion, the Chairman expressed the view that the Board's decision in Spruce Up Corp.17 established an "[u]nduly restrictive reading of the Supreme Court's definition of circumstances in which a successor employer must bargain about initial terms and conditions of employment."

Spruce Up requires that the perfectly clear obligation to notify and bargain with the union relates only to situations where the employer has misled employees about the wages, hours, or conditions of employment or where the employer has failed to clearly announce its intent to establish a new set of conditions prior to inviting former employees to accept employment. In the Chairman's view, Spruce Up grafted an additional requirement not contained in Burns itself. Under Burns the only requirement is that the new employer plans to retain all the employees in the unit. The Chairman pointed out that the employer's obligation was not to adhere to the predecessor agreement, but rather to simply negotiate about changes. In Canteen he said:

To eliminate instances [from the duty to negotiate] . . . where employers express an intent to provide changed employment conditions from the obligation to negotiate under the "perfectly clear" standard announced in Burns would both render the holding on this point meaningless and also disregard the careful balance between competing interests articulated by the Court in both Burns and Fall River Dyeing.18

Chairman Gould noted that where an employer announced his intent to adhere to the predecessor's agreement -- the one situation where the Board seemed to impose an obligation to negotiate -- there was little or nothing to bargain about. And finally, the Chairman noted that any kind of disincentive to hire the predecessor's employees -- the result that would flow from his position according to his critics -- already existed under established federal labor law.

In Lexington Fire Protection Group, Inc., 318 NLRB 347 (August 15, 1995), a 3-2 majority of the Board held that, where past practice supported the procedure employed, an employer could withdraw from a multiemployer association on the basis of a list which had been presented to the union at the commencement of multiemployer negotiations.

The union -- as well as the two dissenting members of the Board -- took the position that the list was a lengthy one and cumbersome and that therefore the union did not have adequate notice of withdrawal. But they noted that this was the practice historically followed and, in a separate concurrence, Chairman Gould pursued the theme that he had set forth in both Randall and Smith's Food & Drug Centers and said the following:

The fact that it may not be the most efficient or best in the view of this Agency or other third parties is irrelevant. It is the process devised by the parties, which they have bargained for, that supports our decision today and not our own view about what is best for them.

In Chel LaCort, 315 NLRB 1036 (December 16, 1994), the Board reconsidered its Retail Associates rule which precludes withdrawal by an employer from an established multiemployer bargaining unit "[e]xcept upon adequate written notice given prior to the date set by the contract for modification, or to the agreed-upon date to begin the multiemployer negotiations."

The United States has never engaged in multiemployer bargaining to an extent comparable to Europe -- and the process has declined in this country in recent years. But the Board found no reason to modify the Retail Associates rule and stated that "unusual circumstances" did not apply to situations where the multiemployer association failed, either deliberately or otherwise, to inform its employer-members of the start of the negotiations. The Board held that the imposition of an "unusual circumstances" exception where the multiemployer association failed to notify its members would "[e]ffectively be imposing a notice requirement on the multiemployer association and inserting ourselves into the association/member relationship unnecessarily and with uncertain consequences." This adherence to the parties' own autonomous structures and procedures is, in Chairman Gould's view, consistent with the approach undertaken in Lexington Fire Protection.

Failure to Negotiate

In Daily News of Los Angeles v. NLRB, 315 NLRB 1236 (December 30, 1994), enforcement granted and cert. denied U.S. Sup. Ct, No 96-576 (January 21, 1997), the Board held that a unilateral change resulting in discontinuance of merit raises violated the Act. They held that the employer could not unilaterally withhold a wage increase from employees where it constituted a change in terms of conditions of employment. The remedy, i.e., backpay which would reflect the merit increases that the employees would have been awarded, as well as the violations were affirmed by the Court of Appeals for the District of Columbia.

In McClatchy Newspapers, Inc., 321 NLRB No. 174 (August 27, 1996), a Board majority held that an employer could not unilaterally implement merit pay proposals even when bargaining had taken place to the point of impasse. The Board said that if the employer was given carte blanche authority over wage increases without regard to time, standards, criteria it would be ". . . so inherently destructive of the fundamental principles of collective bargaining that it cold not be sanctioned as part of a doctrine created to break impasse and restore active collective bargaining." They went on to say: "[W]e are preserving an employer's right to bargain to impasse over proposals to retain management discretion over merit pay while, at the same time, maintaining the Guild's opportunity to negotiate terms and conditions of employment."

Employee Participation

In 1995, the Board issued six decisions which address the issue of under what circumstances employee participation committees violate a section of the National Labor Relations Act that prohibits employer-dominated labor organizations. In deciding these cases the Board relied, in part, on its 1992 Electromation decision, which held that an employee participation committee is illegal if it is a "labor organization" under the Act and if the employer dominates or interferes with the formation or administration of the committee, or contributes to it financial or other assistance.

In Keeler Brass Automotive Group, 317 NLRB 1110 (July 14, 1995), the Board found that the Keeler Brass Grievance Committee is a "labor organization" as defined by Section 2(5) of the Act, and that the respondent violated Section 8(a)(2) by dominating the reformation of the committee and interfering with its administration. Chairman Gould, in a concurring opinion, agreed with the view expressed in the Board's decisions in the 1970s that such entities were not labor organizations within the meaning of the Act and that therefore Section 8(a)(2) was not implicated where decisionmaking responsibilities had been delegated to the council, committee or entity in question. The Chairman expressed agreement with the position taken by the U.S. Court of Appeals for the Seventh Circuit in Chicago Rawhide Mfg. Co. v. NLRB 19 that the employee group found lawful there need not originate with the employees but could be proposed by the employer. He said a number of considerations were important. He spoke approvingly of decisions which are

[C]onsistent with the movement toward cooperation and democracy in the workplace which I have long supported. This movement is a major advance in labor relations because, in its best form, it attempts nothing less than to transform the relationship between employer and employees from one of adversaries locked in unalterable opposition to one of partners with different but mutual interests who can cooperate with one another. Such a transformation is necessary for the achievement of true democracy in the workplace. However, it does pose a potential conflict with the National Labor Relations Act, enacted in 1935 at a time when the adversarial struggle between management and labor was at its height.

The Chairman also said that he thought that the following factors were critical in determining lawful employee-employer programs:

First, there is the question of how the employee group came into being. The court in Chicago Rawhide stressed that the idea for an employee group began with the employees. Does this mean that any employee group which does not originate with employees is subject to unlawful employer domination? I think not. Much of the initiative for cooperative efforts in the workplace has come from employers, particularly in the nonunion sector. I do not think these efforts are unlawful simply because the employer initiated them. The focus should, instead, be on whether the organization allows for independent employee action and choice. If, for example, the employer did nothing more than tell employees that it wanted their participation, I would find no domination provided employees controlled the structure and function of the committee and their participation was voluntary.

Second, the circumstances surrounding the creation of an employee committee are material to a determination of whether there is unlawful domination of the committee. If the employer created an employee participation organization in response to a union organizing campaign, I would draw the inference that the organization was designed to thwart employee independence and free choice.

The following five decisions issued on December 18, 1995:

In Vons Grocery Company, 320 NLRB 53, the Board, upholding the administrative law judge, found that a California company's quality circle group (QCG) was not a labor organization and did not violate the Act. The Board stated: "For nearly three years, the QCG existed lawfully in the Respondent's unionized work force as a group devoted to operational matters. Then, on one and only one occasion, the QCG developed proposals on matters involving conditions of work such as a dress code and an accident point policy." Concluding that this one incident did not "transform a lawful employee participation group into a statutory labor organization" and did not "pose[] the dangers of employer domination of labor organizations that Section 8(a)(2) was designed to prevent," the Board determined that the QCG did not have "a pattern or practice of dealing with the Respondent concerning grievances, labor disputes, wages, rates of pay, hours of employment, or conditions of work."

In Webcor Packaging, Inc., 319 NLRB 1203, the Board affirmed the administrative law judge's finding that a Michigan-based company's Plant Council was an illegal labor organization because it existed for the purpose, at least in part, of making proposals regarding proposed changes in working conditions which management would then consider and either accept or reject. The Board further agreed that Webcor unlawfully dominated the formation and administration of the Plant Council because Webcor determined the Council's function, defined the subject matters to be addressed, and chose employee and management representatives to serve on the Council. The Board stated that "the impetus behind the formation of the Plant Council emanated from the Respondent" and that "the Plant Council had no effective existence independent of the Respondent's active involvement and approval."

In Stoody Co., 320 NLRB 18, the Board reversed the administrative law judge and concluded that an employee "Handbook Committee" created and financially supported by the company, a Kentucky manufacturer, did not engage in a pattern of "dealing with" the company on employment conditions. Accordingly, the committee was not a labor organization and the employer did not violate the Act. The Board pointed out: "The Committee had the brief lifespan of 1 hour. Clearly, a 1-hour meeting in itself shows no pattern or practice of any kind. Further, the Board believes, contrary to the judge, that the evidence supports the inference that if additional meetings of the committee had been held, the meetings would not have resulted in proposals to management on working conditions." The Board held further:

Drawing the line between a lawful employee participation program and a statutory labor organization may not be a simple matter because it may be difficult to separate such issues as operations and efficiency from those concerning the subjects listed in the statutory definition of labor organizations. If parties are burdened with the prospect that any deviation, however temporary, isolated, or unintended, from the discussion of a certain subject, will change a lawful employee participation committee into an unlawfully dominated labor organization, they may reasonably be reluctant to engage in employee participation programs. We support an interpretation of the Act which would not discourage such programs.

In Dillon Stores, 319 NLRB 1245, the Board, agreeing with the administrative law judge, found that the company's Associates' Committees, comprised of hourly employees elected by their co-workers who met quarterly with management to discuss a variety of work-related issues, was a "labor organization under the Act and that the company violated the Act by dominating and interfering with and contributing support to committees at two of its retail stores in Kansas. The Board concurred with the judge who stated that the committees' functions "involved the receipt of proposals and grievances, seemingly on every possible aspect of the employment relationship; and that the communications involved, 'by word or by deed,' acceptance or rejection of those grievances and proposals. This is precisely the bilateral mechanism held to have constituted a labor organization in Electromation."

In Reno Hilton, 319 NLRB 1154, the Board found, as the administrative law judge did, that the Reno Hilton's quality action teams (QATs) were labor organizations and that the teams made recommendations on numerous work-related matters including safety hazards, staffing levels, work times, paid sick days and the wage structure. The Board acknowledged that although most of the team meetings did not involve wages, hours, or other terms and conditions of employment, "that fact alone does not mean that the QATs are not labor organizations," noting that management developed the QATs, determined their agendas, and paid employees for attending the meetings during worktime. "Although the employees volunteered for membership on the QATs and were not selected by management, it is clear that the Respondent thoroughly dominated and interfered with the formation and administration of the QATs," the Board said.

Permanent Replacements

In International Paper Co., 319 NLRB 1253 (December 18, 1995), the Board held that an employer cannot permanently replace employees who have been lawfully locked out where the work has been permanently subcontracted to a non-union firm in order to bring bargaining pressure in support of the employer's bargaining position.

Beck Dues

The Board's decisions in California Saw & Knife, 320 NLRB 224 (December 20, 1995), and Paperworkers Local 1033 (Weyerhaeuser Paper Co.), 320 NLRB 349 (December 20, 1995), are the first cases in which it decided questions arising from the Supreme Court's ruling in Communications Workers v. Beck. In Beck, the Supreme Court held that a union was not permitted, "over the objections of dues-paying nonmember employees," to expend funds on activities not related to collective bargaining, contract administration or grievance adjustment. The court concluded that such expenditures violated the union's duty of fair representation.

In California Saw, the Board ruled, among other things, that a union must inform each nonmember employee, at the same time or before it seeks to obligate the employee to pay dues and fees under a union-security clause, that he has the legal right to remain a nonmember and the right under Beck to object to paying more than "representational" expenses. The Board held that notice could be provided through a monthly magazine available to nonmembers as well as members. The Board said:

[T]he union should inform the employee that he has the right to be or remain a nonmember and that nonmembers have the right (1) to object to paying for union activities not germane to the union's duties as bargaining agent and to obtain a reduction in fees for such activities not germane to the union's duties as bargaining agent and to obtain a reduction in fees for such activities; (2) to be given sufficient information to enable the employee to intelligently decide whether to object; and (3) to be apprised of any internal union procedures for filing objections. If the employee chooses to object, he must be apprised of the percentage of the reduction, the basis for the calculation, and the right to challenge these figures.

The Board also held that a union is not obligated on the basis of existing precedent to calculate its dues reductions on a unit-by-unit basis. They held that a dissident cannot object to litigation expenses incurred in a bargaining unit different from the objector's bargaining unit. The Board said:

[T]hat some litigation may be of value to employees even when the lawsuit at issue arises out of the contract or circumstances of employees in a different unit.

In Weyerhaeuser, supra, the Board held that a union must inform all employees in the bargaining unit, not just nonmembers, of the rights of nonmembers under Beck if they were not informed of those rights prior to assuming obligations under a union-security clause. In addition, the Board held that a union also must inform all such employees that they have a right under the Supreme Court's ruling in NLRB v. General Motors, to become nonmembers of the union in order to be eligible to exercise Beck rights.

Thus, for the first time, these decisions of the Board impose an affirmative duty on unions to disclose the precise obligations that workers have under union security agreements and the fact that "membership does not mean full membership to which employees may be contractually obligated." Therefore, the Board applied the principles set forth in California Saw and Weyerhaeuser and found violations of the Act based on union failures to provide employees notice of the Beck rights. See I.U.E. Local 444 (Paramax Systems), 322 NLRB No. 1 (August 27, 1996); Production Workers Local 707 (Mavo Leasing), 322 NLRB No. 9 (August 27, 1996); Laborers Local 265 (Fred A. Newman), 322 NLRB No. 47 (September 30, 1996); Carpenters Local 943 (Oklahoma Fixture), 322 NLRB No. 142 (January 10, 1997); and IATSE Local 219 (Hughes-Avicom), 322 NLRB No. 195 (February 14, 1997).

Oklahoma Fixture is noteworthy in that the Board obligated the union to provide the mandated accounting of expenditures, notwithstanding the fact the union contended it offered the objecting employee a reasonable accommodation by informing him that he could pay the equivalent of full dues to a mutually agreed-upon charity. Although the Board found Beck notice violations in the above cases, it dismissed an allegation in Paramax that the union violated Section 8(b)(1)(A) by failing to have its chargeable expenses verified by an independent auditor. And in Fred Newman, the Board found that because the union had waived an objector's obligation to pay dues, the union did not act unlawfully by not providing him Beck financial information.

Unlawful Union Conduct

In Laborers Union Local No. 324, Laborers International Union of North America, 318 NLRB 589 (August 25, 1995), enforcement denied, 154 LRRM 2417 (9th Cir. 1997), Chairman Gould joined the majority of Members Stephens and Cohen in upholding the administrative law judge's finding that the union violated Section 8(b)(1)(A) of the Act by adopting and maintaining an no-solicitation, no-distribution rule designed to preclude the distribution of dissident union material by threatening to have the dissident candidate for union office arrested and removed from the hiring hall and by threatening to have him arrested if he continued to disseminate such material outside the hiring hall. The Board held that this kind of conduct was a violation of the statute, notwithstanding the fact that it had not been enshrined into a formal rule, a requirement which dissenting Members Browning and Truesdale regarded as appropriate.

Illegal Secondary Conduct

In Painters and Allied Trades District Council No. 51 (Manganaro Corporation), 321 NLRB No. 31 (May 10, 1996), Chairman Gould and Member Browning, with Member Cohen dissenting, held that the anti-dual-shop clause sought by the union had a primary objective and thus did not violate Section 8(b)(4)(B) of the Act. The majority agreed with the judge's finding that the clause was a primary work-preservation clause and that the clause was not unlawful on its face.

Remedies

In Fieldcrest Cannon, Inc., 318 NLRB 470 (1995), enfd. in part 97 F.3d 65, 153 LRRM 2617 (4th Cir. 1996), petition for rehearing denied February 10, 1997, the Board (Chairman Gould and Member Browning; Member Stephens concurring and dissenting in part) found that the respondent employer's unfair labor practices were so numerous, pervasive and outrageous that special notice and access remedies were necessary to dissipate fully the coercive effect of the violations.

In NLRB v. Unbelievable, Inc., 71 F.3d 1434, 150 LRRM 3002 (9th Cir. 1995), the Board and union sought sanctions against the respondent employer for filing a frivolous appeal from the Board's decision in the case (309 NLRB 761 (1992)). The court granted the requests and ordered the respondent employer and its original counsel, jointly and severally, to pay the Board and union attorneys fees and double costs.

In A.P.R.A. Fuel Oil Buyers Group, Inc., 320 NLRB 408 (December 21, 1995), Chairman Gould joined a Board majority which interpreted the Supreme Court's Sure-Tan decision, which had concluded in 1984 that undocumented workers are employees within the meaning of the National Labor Relations Act. The question in A.P.R.A Fuel was whether such workers are entitled to backpay and the Board answered this question in the affirmative. The Chairman, along with Member Truesdale, rejected the view of Member Browning that the employer could be ordered to hire applicants referred by the union in the event that dismissed workers were not eligible for reinstatement. The Chairman explicitly stated that the Board does not have the authority to grant such a remedy.

The A.P.R.A. Fuel case has triggered legislative initiatives by the Congress, specifically, in the form of a bill put forward by Congressman Tom Campbell. Congressman Campbell in legislation initially offered in 1996 would substitute a fine for the backpay ordered by A.P.R.A. so as to eliminate the incentive for illegal behavior without compensating employees who are not lawfully in the United States.

In Temp-Rite Air Condition, 322 NLRB No. 134 (December 27, 1996), Chairman Gould joined with Member Higgins, over Member Browning's dissent, to hold that a deduction from backpay may be made where an employee sold the employer's property and did not reimburse the employer.

In one of the salting cases that has emerged as a result of the Supreme Court's unanimous affirmance of the Board's view that paid union organizers are employees within the meaning of the Act, Chairman Gould dissented from the holding of Members Browning and Cohen in Eldeco, Inc., 321 NLRB No. 121 (July 29, 1996), that an employee who was not capable or qualified to perform the work could nonetheless receive reinstatement and have backpay adjudicated in compliance. Chairman Gould expressed the view that "reinstatement" and other traditional remedies are not to be awarded automatically.

Similarly, in Paper Mart, 319 NLRB 9 (September 20, 1995), Chairman Gould expressed the view that he would find unlawful discrimination in any case in which the General Counsel establishes that an employer's adverse action against an employee is based in whole or in part on anti-union animus. Chairman Gould would find that an employer's showing that the adverse action would have occurred in any event goes only to the remedy issued against the employer.

# # #


* * * FOOTNOTES * * *

1 The views herein are those of the Chairman. They do not necessarily reflect those of the entire Board.

2 This follows the recommendation of the Subcommittee on Separation of Powers of the Senate Committee on the Judiciary chaired by Senator Sam J. Ervin, Jr., of North Carolina, Congressional Oversight of Administrative Agencies (National Labor Relations Board) Report of the Committee on the Judiciary, United States Senate by its Subcommittee on Separation of Powers Together with Individual and Additional Views, 91st Cong., 1st Sess. (1970) (U.S. Government Printing Office). The Subcommittee stated the following:

Rulemaking would permit all interested parties to submit their learning and their views on such issues and broaden the informational and adversary base from which Board decisions are made. It would also ensure that the policy formulated is not skewed because it is adopted in the context of the facts of a particular case. It would, moreover, stop the practice of making individual parties the victims of delay, retroactivity and perhaps decisions unrelated to the facts of the particular case because the Board has chosen it at random to be the vehicle for a major policy pronouncement. And, finally, it would lessen the litigation which excessive reliance on case-by-case adjudication necessarily encourages.

Failure to use the rulemaking procedures also has undoubtedly contributed to the ever-increasing caseload which threatens a breakdown of the law's administration. It has already cost it much more, however, in the quality of its decisions.

3 Young Men's Christian Association, 286 NLRB 1052 (1987).

4 Member Cohen dissented in this case as well as Sunrise Rehabilitation.

5 107 NLRB 427 (1953).

6 Novotel New York, 321 NLRB No. 93 at page 13.

7 See NLRB v. Health Care & Retirement Corp., 114 S.Ct. 1778 (1994); Northcrest Nursing Home, 313 NLRB 491 (1993); and cases cited therein.

8 Subsequently, the Employer filed a motion for reconsideration in which it agreed to stipulate to a mail ballot for the eligible strikers. On that basis, the Board remanded the case to the Regional Director to conduct the election.

9 85 F.3d 671 (DC Cir. 1996)

10 ResCare, Inc., 280 NLRB 670 (1986).

11 NLRB v. American Insurance, 343 U.S. 395 (1952); NLRB v. Insurance Agents' Union, 361 U.S. 477 (1960), and American Ship Building v. NLRB, 380 U.S. 300 (1965).

12 112 S. Ct. 841 (1992).

13 22 F.3d 1114, cert. denied 115 S.Ct. 575 (1994).

14 219 NLRB 656 (1975), enfd. 531 F.2d 1162 (2d Cir. 1976).

15 282 NLRB 1375 (1987).

16 406 U.S. 292, 294-295 (1972).

17 209 NLRB 194 (1974), enfd. on other grounds 529 F.2d 516 (4th Cir. 1975).

18 482 U.S. 27 (1987).

19 221 F.2d 165 (7th Cir. 1995).

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