Opinion
No. 75-1250.
Argued January 13, 1976.
Decided April 8, 1976. Rehearing Denied May 13, 1976.
Seymour A. Gopman, North Miami Beach, Fla., for petitioner. William T. Coleman, Jr., Miami, Fla., was on the brief for petitioner.
Elliott Moore, Deputy Associate Gen. Counsel, N.L.R.B., Washington, D.C., with whom John C. Miller, Acting Gen. Counsel and John S. Irving, Jr., Deputy Gen. Counsel, N.L.R.B., Washington, D.C., were on the brief for respondent.
Jesse S. Hogg, Coral Gables, Fla., with whom W. Reynolds Allen, Coral Gables, Fla., was on the brief for intervenor.
Petition for Review of an Order of the National Labor Relations Board.
Before BAZELON, Chief Judge, TAMM, Circuit Judge and JUSTICE, United States District Judge for the Eastern District of Texas.
Sitting by designation pursuant 28 U.S.C. § 292(d).
Opinion for the court by Chief Judge BAZELON.
Circuit Judge TAMM dissents from the opinion.
In September, 1966 Teamsters Local Union 769, the petitioner, was certified by the NLRB as the exclusive bargaining representative of the production, maintenance and distribution employees of Peoples Gas System Inc.'s Miami operations. The Union and employer signed a three-year contract in 1967 and, after a strike in February, 1970, signed a second three-year contract that expired on February 6, 1973. Negotiations on a third contract began on January 9, 1973. After six bargaining sessions and several communications by phone and letter, the Company, on April 23, 1973, filed a representation election petition with the Board and thereafter refused to bargain further with the Union.
On May 15, 1973, the Union filed an unfair labor practice charge with the Board, alleging that the employer's refusal to bargain violated § 8(a)(5) of the National Labor Relations Act, 29 U.S.C. § 158(a)(5). The General Counsel issued a complaint, and after conducting hearings, the Administrative Law Judge found the Company guilty of an unfair labor practice. His decision was reversed by a three-member panel of the Board. After the Union's petition for reconsideration was denied, the Union filed this appeal.
I
A threshold question has been raised by the Intervenor-Employer in a motion to dismiss the appeal as moot. In support of this motion Intervenor notes that the record, as supplemented by order of this court in response to an earlier motion by Intervenor, reveals that on the day after its motion for reconsideration was denied, the Union filed a petition for certification of representative with the Board. An election was held on May 30, 1975, which the Union lost by roughly a 3-2 margin. No objections to the election were filed, and on June 10, 1975, the results were certified. Intervenor contends that even if its refusal to bargain were unlawful, the likelihood of repetition is now almost nil, since there currently is no bargaining representative for the unit. Intervenor therefore urges this court to exercise its discretion to decline to adjudicate this case.
NLRB v. Typographical Local 101, 152 U.S.App.D.C. 365, 470 F.2d 1274 (1972).
Implicit in Intervenor's argument is the assumption that even if the Union were to prevail on the merits, the only appropriate remedy after the Union's election defeat would be a cease and desist order aimed against future refusals to bargain. If all that were at issue were the possible issuance of a cease and desist order, Intervenor's argument might be persuasive. But we agree with the position taken by counsel for the Board that the Board's remedial powers are not so limited. At least at this stage of the proceedings, we are not prepared to say that were the Board's decision to be reversed, the Board would be powerless to mandate a new election or even to issue a bargaining order. To be sure, the Board's practice has been not to issue a bargaining order on the basis of pre-election refusals to bargain if a union thereafter loses an election and the results are certified. Nor has the Board entertained challenges to elections based on conduct occurring before the election petitions were filed. But these rules were developed to prevent parties from bypassing the Board, seeking an election, and then, if unsuccessful in a fair election, seeking relief from the Board. Intervenor concedes that this appears to be the first case in which an election was requested and held only after all Board remedies had been exhausted and solely as a means of "bypassing" the courts — that is, of avoiding the delay attendant upon appellate review. We do not believe the Board would lack the power — and will not speculate as to whether it would have the will — to create an exception to its rules in this case. Accordingly, we reach the merits of the petition for review.
See NLRB v. Raytheon Co., 398 U.S. 25, 27, 90 S.Ct. 1547, 1548, 26 L.Ed.2d 21, 24 (1970).
See, e. g., Fibreboard Paper Products Corp. v. NLRB, 379 U.S. 203, 216, 85 S.Ct. 398, 405, 13 L.Ed.2d 233, 241 (1964); 29 U.S.C. § 160(c) (1970).
Irving Air Chute, 149 NLRB 627 (1964), enforced, 350 F.2d 176 (2d Cir. 1965); see Retail Clerks Local 1401 v. NLRB, 149 U.S.App.D.C. 370, 463 F.2d 316 (1972). See also Bernel Foam Products, 146 NLRB 1277 (1964).
Goodyear Tire Rubber Co., 138 NLRB 453 (1962); Ideal Electric Manufacturing Co., 134 NLRB 1275 (1961).
II
The Board's decision begins with a statement of the well-established principle applicable to withdrawals of recognition from incumbent unions:
Peoples Gas System, Inc., 214 NLRB No. 141 at 2 (1974).
After the certification year has run, an employer may lawfully withdraw recognition from an incumbent union because of an asserted doubt of the union's continued majority, if its withdrawal occurs in a context free of unfair labor practices and is supported by a showing of objective considerations providing reasonable grounds for a belief that a majority of the employees no longer desire union representation.
This formulation is in general conformity with our requirement that serious doubt of the Union's majority be shown, and essentially is not contested on this appeal. What is at issue here is whether there was a sufficient objective basis to give rise to such a doubt.
See, e. g., Industrial Wrkrs. Local 289 v. NLRB, 155 U.S.App.D.C. 112, 476, F.2d 868, 881 (1973) and Machinists Lodges 1746 and 743 v. NLRB, 135 U.S.App.D.C. 53, 416 F.2d 809, 812 (1969), cert. denied, 396 U.S. 1058, 90 S.Ct. 751, 24 L.Ed.2d 752 (1970), quoting Stoner Rubber Co., 123 NLRB 1440, 1445 (1959).
See Bartenders, Hotel, Motel Restaurant Employers Bargaining Ass'n, 213 NLRB No. 74 at 9 (1974) (equating "reasonable doubt" and "serious doubt"). Compare cases cited note 7 supra with Dallas Drivers Local 745 v. NLRB, 163 U.S.App.D.C. 100, 500 F.2d 768, 770 (1974), and Retail Union v. NLRB, 151 U.S.App.D.C. 209, 466 F.2d 380, 393 (1972) (both employing a "reasonable doubt" test).
This court, along with other circuits, see, e. g., NLRB v. Washington Manor Inc., 519 F.2d 750, 751 (6th Cir. 1975); Retired Persons Pharmacy v. NLRB, 519 F.2d 486, 489 (2d Cir. 1975); Orion Corp. v. NLRB, 515 F.2d 81 (7th Cir. 1975), and the Board, see, e. g., Guerdon Industries, 218 NLRB No. 69 (1975); Celanese Corp., 95 NLRB 664 (1951), has repeatedly held that to be a defense, a "reasonable" or "serious" doubt requires both objective facts to support it and good faith in asserting it. Here, however, the Board did not discuss the employer's motivation in withdrawing recognition from the Union. Petitioner does not contend, however. that the Board deviated from its prior decisions in this regard.
The Board relied on a combination of three factors to find an objective basis for a reasonable doubt. First, it noted that from February, 1970, immediately before a strike, to April, 1973, there was a "severe and dramatic" decline in the number of dues-checkoff authorization cards on file with the Company. In 1970, 76% of all members of the unit, and 90% of all nonprobationary members — persons who had been employed for over 90 days and under company policy were eligible for checkoff — had submitted authorizations; in 1973 the comparable figures were 39% and 51%.
During all times relevant to this case, Florida was a right to work state.
Intervenor contends that the ALJ and the Board erred in including two employees as being on checkoff, and that without these employees the relevant percentage would be under 50%. We cannot say, however, that the Board's factual finding is without substantial support in the record.
Second, the Board discussed what it termed "a sudden and unexplained change in bargaining posture under circumstances strongly suggestive of a lack of confidence by the Union itself as to the degree of support it had maintained." Specifically the Board noted that the Union, after having insisted throughout the 1973 negotiations that it would strike if no agreement had been reached when the old contract expired, announced on February 2, four days before the expiration date, that the bargaining committee would submit the employer's final but incomplete offer to the membership, but would recommend rejection; that on February 5th the bargaining committee reversed itself and recommended acceptance of the offer; and that after a series of communications, concerning what agreement, if any, had been reached, the Union, on April 11, 1973 and again several times after the Company withdrew recognition, announced its willingness to sign whatever agreement the Company drafted, subject to the Union's right to proceed through the Board to vindicate its claim that agreement already had been reached on certain issues.
Third, the Board noted substantial changes in the composition of the unit since 1970. During the strike, 40% of the work force had been permanently replaced. In September, 1972, the size of the unit increased 17% by the addition of previously non-unionized employees acquired in a merger with a competitor; none of those employees had submitted checkoff authorization cards as of April, 1973 despite an organizational effort beginning in January, 1973. And from September, 1972 to April, 1973, the unit experienced a 36% turnover.
The Board also stated that from 1970 to 1973 the turnover rate was 36%. That statement does not appear to be supported by anything in the record.
Relying on "the totality of these circumstances," the Board found that the employer had an objective basis for doubting the Union's continuing majority.
III
Petitioner contends that the employer could not reasonably have doubted the Union's majority when a majority of the eligible employees had submitted checkoff authorizations. Insofar as petitioner argues for a per se prohibition on employers ever withdrawing recognition from an incumbent union under these circumstances, we cannot agree. Just as an employee's decision not to submit an authorization card does not necessarily mean he opposes the union, so, too, a decision to submit a card — or not to withdraw an already submitted card — does not necessarily mean the employee supports the union. Decisions to submit or not withdraw authorizations may be attributable to confusion, ignorance, peer pressure, and, in cases of failure to withdraw, to procrastination or inertia. for these reasons, the Board has more than once upheld an employer's refusal to bargain with an incumbent union even though a majority of the employees had submitted checkoff authorizations. In an appropriate case, we would agree.
See, e. g., Terrell Machine Co. v. NLRB, 427 F.2d 1088 (4th Cir.), cert. denied, 398 U.S. 929, 90 S.Ct. 1821, 26 L.Ed.2d 91 (1970); NLRB v. Gulfmont Hotel Co., 362 F.2d 588 (5th Cir. 1966); Harpeth Steel Inc., 208 NLRB 545 (1974); Barrington Plaza Tragniew, Inc., 188 NLRB 962 (1970), enforcement denied in part, 470 F.2d 669 (9th Cir. 1972).
This is especially true where, as here, the authorization cards, by their terms, are revocable for only a ten day period each year.
Mitchell Standard Corp., 140 NLRB 496 (1963); Randall Co., 133 NLRB 289 (1961).
But insofar as petitioner is contending that the employer bears a heavy burden in this case, petitioner is clearly correct. The Union can claim the benefit of two well-established presumptions (in addition to the general presumption that an incumbent union has a continuing majority): (1) that all the employees on checkoff — 51% of the nonprobationary employees — supported the Union as their bargaining representative; and (2) that the same proportion of new or probationary employees — 51% — also supported the Union. In light of these presumptions, the employer could reasonably doubt the Union's continuing majority if, but only if, there were an objective basis for believing either that (a) the checkoff cards overstated the Union's support among the nonprobationary employees, or (b) a lesser percentage of the probationary employees supported the Union such that the Union lacked a majority of the total unit. In finding an objectively based reasonable doubt, however, the Board's opinion fails to focus on these narrow issues; indeed, the opinion does not appear to attach any significance to the fact that a majority of the eligible employees were on checkoff. Consequently, we are left at large to speculate as to the relevance of the factors on which the Board did rely.
See, e. g., Machinists Lodges 1746 743, supra note 7, at 812 n. 8; NLRB v. Howe Scale Co., 311 F.2d 502, 505 (7th Cir. 1963); NLRB v. Auto Ventshade, Inc., 276 F.2d 303, 307 (5th Cir. 1960); United Supermarkets, Inc., 214 NLRB No. 142 at 3 (1974); Mitchell Standard Corp., supra note 14, at 500.
See, e.g., Strange Lindsey Beverages, Inc., 219 NLRB No. 190 (1975); Laystrom Manufacturing Co., 151 NLRB 1482 (1965), enforcement denied, 359 F.2d 799 (7th Cir. 1966). See also, e.g., NLRB v. King Radio Corp., 510 F.2d 1154, 1156 (10th Cir.), cert. denied, 423 U.S. 839, 96 S.Ct. 68, 46 L.Ed.2d 58 (1975); Dallas Drivers Local 745 v. NLRB, supra note 8, at 771.
Our difficulty becomes clear when those factors are separately analyzed. The Board first considered the decline in the employees on checkoff. The courts and the Board have recognized the relevance of this consideration when less than a majority of the employees were on checkoff. In those cases the trend of checkoffs strengthened the inference that the low number of checkoff cards reflected a lack of union support. Here, however, the significance of the trend is unclear. Does the decline indicate that persons still on checkoff actually may not support the Union? Does it indicate that persons not yet eligible for checkoff do not support the Union? We do not mean to suggest that the Board could not answer either or both of these questions in the affirmative. The point is that the Board has not provided us with a reasoned basis for doing so.
National Cash Register Co. v. NLRB, 494 F.2d 189, 194-95 (8th Cir. 1974); Ingress-Plastene, Inc. v. NLRB, 430 F.2d 542, 546-47 (7th Cir. 1970); NLRB v. H. P. Wasson Co., 422 F.2d 558, 561 (7th Cir. 1970); Convair Division, 169 NLRB 131 (1965). See also Machinists Lodges 1746 743 v. NLRB, supra note 7, at 812 (relying on decline in checkoff cards but not specifying percentage on checkoff).
Although unstated, the justification appears to be that since the reasons why union supporters would not submit authorization cards remain constant over time, a sharp decrease in the number of cards suggests a decrease in union support (and not an increase in the number of supporters not on checkoff).
Much the same is true when the Board's second factor, changes in composition of the unit, is considered. Again, this factor has been considered relevant in other cases, generally when used to impeach the continuing vitality of an earlier showing of support such as an election. But here the issue is not the significance of some past showing of support, but of a present showing. Thus, the relevance of turnover prior to the present showing of support is attenuated.
See e.g., Taft Broadcasting, 201 NLRB 801 (1973); Lloyd McKee Motors Inc., 170 NLRB 1278 (1968); Stoner Rubber Co., 123 NLRB 1440 (1959). But see, e.g., case cited note 16 supra.
The changes in composition on which the Board relied can be divided into two types. First is the 40% turnover occurring after the 1970 strike, and the 17% accretion resulting from the 1972 merger — changes "under circumstances suggesting a lesser degree" of Union support. But all the persons added as a result of these two events already were, if they were still employed by the Company, nonprobationary employees at the time recognition was withdrawn. Thus, they already were counted as part of the 51% on checkoff or the 49% off. Perhaps the Board intended to conclude that the circumstances under which these employees were added suggests that even those who submitted authorization cards might not have been Union supporters, so that the 51% figure is misleading. Or perhaps the Board thought these circumstances were relevant to the issue of Union support among new employees. But again the Board failed to articulate its reasons for so concluding.
Petitioner has not questioned whether the Board's assumption that replacements for strikers are less likely to support a union than strikers can be reconciled with decisions such as Industrial Wrkrs. Local 289 v. NLRB, supra note 7, at 881, James Whitfield Inc., 220 NLRB No. 64 (1975), or King Radio Corp., 208 NLRB 578 (1974), enforced, 510 F.2d 1154 (10th Cir. 1975), all holding that strikebreakers are not presumptively anti-union.
In its brief, the Board fails to recognize this fact, and thus uses turnover in 1970 and in September of 1972 to support an inference that the new employees — those hired after January, 1973 — did not support the Union in the same ratio as the nonprobationary employees. Brief at 15 n. 12.
The second aspect of the change in composition was the 36% turnover from September, 1972 to April, 1973 — turnover under "neutral" circumstances. The relevance of this turnover is even less clear. Precisely because the circumstances surrounding the turnover were neutral, the high rate — projected to 61% annually — does not appear relevant to establishing doubt as to whether the probationary employees desired to be represented by the Union.
It would seem that, if anything, the new employees should more strongly support the Union than the old employees, since the new employees were not hired under circumstances suggesting a lesser degree of Union support.
The final factor considered by the Board — the Union's "strange" behavior during negotiations — is directly relevant to impeaching the significance of the number of employees on checkoff. But the Board's opinion does not indicate whether it regarded the bargaining events as alone sufficient to support its decisions, yet, as already noted, the Board failed to explain the relevance of the other factors. Accordingly, we return the case to the Board for reconsideration and rearticulation of its decision.
See, e.g., SEC v. Chenery Corp., 318 U.S. 80, 63 S.Ct. 454, 87 L.Ed. 626 (1943); Sheet Metal Local 223 v. NLRB, 162 U.S.App.D.C. 145, 498 F.2d 687 (1974); UAW v. NLRB, 136 U.S.App.D.C. 104, 419 F.2d 686 (1969).
IV
We briefly consider several additional claims of error raised by petitioner, in the hope of shortcircuiting any future litigation after the proceedings on remand. In so doing, we do not decide whether these grounds, either separately or together, would provide an independent basis for reversing the Board.
1. Much of the evidence concerning changes in composition of the unit and the decline in checkoff authorizations was not based on the first-hand knowledge of the witness who supplied it, the counsel to the Company, but on what he was told by personnel in the Company's payroll department. Although petitioner did not object to every hearsay statement, and stipulated to much of the evidence concerning the trend in checkoffs, the hearsay objection was repeatedly advanced. The Administrative Law Judge's ruling is not entirely clear, but it appears that he admitted the testimony solely to establish the Company's motivation for withdrawing recognition, and not to prove an objective basis for action. The ALJ's opinion clearly assigns little weight to the hearsay testimony. The Board, however, treated the testimony as fully probative evidence. Petitioner argues that the Board erred in so doing.
It is unclear whether counsel's testimony regarding turnover after the 1970 strike was based on first hand knowledge. See Tr. at 170. The remainder of his statistical testimony admittedly was hearsay.
See Tr. at 167 (stipulated that 90% of nonprobationary employees on checkoff in 1970); Jt. Exhibit 1 (listing of all nonprobationary employees as of April 23, 1973 with indication of which were on checkoff).
See Tr. at 170, 195-96, 197-98.
Compare Tr. at 195, 196 (testimony admissible only to prove good faith) with id. at 198 (if documents were given to General Counsel, "you can't contradict it unless it's not a fact, and if you think it's significant, present the testimony").
Tr. at 195, 196; cf. Schwarzenbach-Huber Co. v. NLRB, 408 F.2d 236 (2d Cir.), cert. denied, 396 U.S. 960, 90 S.Ct. 436, 24 L.Ed.2d 425 (1969).
Peoples Gas System, Inc., supra note 6, at 17 (" asserted replacement of 40 percent of the strikers"), 21 ("no probative evidence . . . to substantiate these figures" concerning checkoff cards), 24 ("unsubstantiated" evidence regarding turnover "a weak reed . . to sustain a reasonable doubt").
That the Board has some discretion to admit evidence that would be inadmissible in a court of law cannot be denied. Nor can its power to overrule an ALJ's ruling on evidentiary issues be questioned. But the Board at least should address the evidentiary questions, and articulate its reasons for reversing the ALJ. In this case the Board failed to do so.
29 U.S.C. § 160(b) (1970) states that "so far as practicable," Board hearings "[shall] be conducted in accordance with the rules of evidence . . . ." The courts have read this section liberally. See, e.g., NLRB v. Addison Shoe Corp., 450 F.2d 115 (8th Cir. 1971); NLRB v. Capitol Fish Co., 294 F.2d 868 (5th Cir. 1961); NLRB v. W.B. Jones Lumber Co., 245 F.2d 388 (9th Cir. 1957); NLRB v. Hod Carriers Local 210, 228 F.2d 589 (2d Cir. 1955).
Cf. Universal Camera Corp. v. NLRB, 340 U.S. 474, 71 S.Ct. 456, 95 L.Ed. 456 (1951); Local 4-243, Oil Wrkrs. v. NLRB, 124 U.S.App.D.C. 113, 362 F.2d 943 (1966).
See, e.g., Local 4-243, supra note 31, at 946; F. W. Means Co. v. NLRB, 377 F.2d 683 (7th Cir. 1967). See also cases cited note 23 supra.
2. Petitioner points to a number of areas in which it alleges the Board decision is inconsistent with prior or subsequent Board decisions. The Board cannot be expected, on pain of reversal, to anticipate and distinguish every marginally relevant case that a litigant might uncover in preparing a petition for review. But the Rule of Law requires that agencies apply the same basic standard of conduct to all parties appearing before them. Thus, "if an agency glosses over or swerves from prior precedents without discussion it may cross the line from the tolerably terse to the intolerably mute."
Greater Boston TV Corp. v. FCC, 143 U.S.App.D.C. 383, 444 F.2d 841, 852 (1970), cert. denied, 403 U.S. 923, 91 S.Ct. 2229, 2233, 29 L.Ed.2d 701 (1971); see, e.g., Teamsters Local 814 v. NLRB, 167 U.S.App.D.C. 387, 512 F.2d 564, 567 (1975); id., at 571-72 cases cited n. 15 (Bazelon, C. J., dissenting in part).
Some of the cases to which petitioner points are so palpably distinguishable that there was no need for the Board to address them. But in at least two respects, petitioner's argument has some merit. First, in drawing an inference from the decision of the employees added by merger not to submit checkoff cards, the Board appears to have ignored its decisions holding that such a decision does not mean the employees oppose representation by the Union. Second, the Board recited events that occurred after the employer withdrew recognition from the Union, suggesting that it was relying on such events in contravention of several Board decisions. We do not mean to imply that the Board necessarily was precluded from relying on these facts. It was, however, required to justify its decision to do so.
For example, petitioner complains that in considering its "strange" bargaining behavior, the Board ignored Kentucky News, 165 NLRB 777 (1967), holding that the failure to implement a strike threat was "no basis for the conclusion . . . [of] lack of employee support." But there the Union's decision not to strike was an isolated event whereas here the Board considered the decision in the context of a series of events culminating in what the Board regarded as "capitulation" by the Union. Similarly, petitioner contends that Barrington Plaza Tragniew, supra note 12, precluded the Board from considering the turnover after the 1970 strike because it was too remote in time. But Tragniew, by its terms, is limited to cases in which an employer defends against an 8(a)(5) charge by contending that at the time of a prior contract the union lacked majority support.
See cases cited note 12 supra.
See, e.g., Bartenders, Hotel, Motel Restaurant Employers Bargaining Ass'n, supra note 8; Orion Corp., 210 NLRB 633 (1974), enforced, 515 F.2d 81 (7th Cir. 1975).
We do not consider intervenor-employer's contentions that the ALJ improperly excluded some of its evidence establishing an objective basis for the employer's doubt. On remand the Board can reopen the hearings to consider this evidence if it finds the evidence already in the record insufficient to support the employer's claim, and further finds that the ALJ erred in excluding the additional evidence.
Reversed.