Uforma/Shelby Business Forms, Inc. v. N.L.R.B.

• Decision Date: 23 April 1997
• Docket Number: Nos. 96-5170,96-5350,s. 96-5170
• Parties: 155 L.R.R.M. (BNA) 2001, 133 Lab.Cas. P 11,802, 46 Fed. R. Evid. Serv. 1498 UFORMA/SHELBY BUSINESS FORMS, INC., d/b/a Miami Systems Corporation, Shelby Division, and CC Direct, a single integrated enterprise, Petitioner/Cross-Respondent, v. NATIONAL LABOR RELATIONS BOARD, Respondent/Cross-Petitioner.
• Court: U.S. Court of Appeals — Sixth Circuit

Page 1284

111 F.3d 1284

155 L.R.R.M. (BNA) 2001, 133 Lab.Cas. P 11,802,

46 Fed. R. Evid. Serv. 1498

UFORMA/SHELBY BUSINESS FORMS, INC., d/b/a Miami Systems Corporation, Shelby Division, and CC Direct, a single integrated enterprise Petitioner/Cross-Respondent, v. NATIONAL LABOR RELATIONS BOARD, Respondent/Cross-Petitioner.

Nos. 96-5170, 96-5350.

United States Court of Appeals Sixth Circuit.

Argued March 20, 1997.

Decided April 23, 1997.

David K. Montgomery (argued), Paul D. Dorger (briefed), Keating, Muething & Klekamp, Cincinnati, OH, for Uforma/Shelby Business Forms, Inc., Shelby Division and CC Direct.

Joseph Oertel (argued and briefed), National Labor Relations Board, Office of the General Counsel, Washington, DC, Aileen A. Armstrong, Dep. Asso. Gen. Counsel, Charles P. Donnelly (briefed), National Labor Relations Board, Appellate Court Branch, Washington, DC, for National Labor Relations Board.

Before: KENNEDY, KRUPANSKY, and NORRIS, Circuit Judges.

KENNEDY, Circuit Judge.

Petitioner Uforma/Shelby Business Forms, Inc. appeals the decision of the National Labor Relations Board ("Board"), which affirmed the decision by the Administrative Law Judge ("ALJ") that petitioner violated the National Labor Relations Act, 29 U.S.C. §§ 151 et seq. ("NLRA"). For the following reasons, we REVERSE the ruling that petitioner violated §§ 158(a)(1), (a)(5) by not providing prior notice or opportunity to bargain before eliminating employees, REMAND for further proceedings consistent with this opinion claims under §§ 158(a)(1), (a)(3) that petitioner threatened to eliminate, and later eliminated, employees in retaliation for protected union activity, and AFFIRM the ruling that petitioner violated § 158(a)(1) by threatening adverse action for attempts at unionization.

I.

Petitioner, a corporation which produces printed business forms, maintains a facility in Shelby, Ohio. A local chapter of Graphic Communications International Union, AFL-CIO ("the union") represents a unit of production and maintenance employees at the Shelby facility. During the time period relevant to this lawsuit, the union and petitioner maintained a collective bargaining agreement which was effective from June 1, 1992 to June 1, 1994.

On August 31, 1993, the General Counsel for the Board ("General Counsel") filed an amended complaint consolidating prior unfair labor practice charges filed against petitioner by the union. The General Counsel alleged that petitioner had violated the NLRA, 29 U.S.C. §§ 158(a)(1),(a)(3),(a)(5), by threatening the union, retaliating for protected union activity, and bargaining in bad faith. On January 31 and February 1, 1994, the ALJ held a hearing on the charges, at which the following evidence emerged:

In 1992, petitioner began to assign salaried employees who were not members of the union to perform work as the assistant foreman for the third shift at the Shelby plant. On July 20, 1992, the union filed a grievance alleging that the collective bargaining agreement required petitioner to assign a union employee to the position. Petitioner denied the grievance at the first and second steps.

On October 20, 1992, union representatives Dan Reese and Mike Lybarger met with Beulah Pifer, the manager of human resources for petitioner, to discuss the grievance. Reese and Lybarger testified that Pifer told them that William O'Bryan, the general manager for petitioner, "blew up" when she had mentioned the grievance and informed Pifer that he would "eliminate the problem" if she could not "take care" of the grievance. When Lybarger asked her if this meant that petitioner would eliminate the third shift if the union pursued the grievance, Pifer responded that it was a possibility.

On October 27, 1992, Reese and Lybarger and union president Virgil Porter again discussed the grievance with Pifer and plant manager Eric Vail. Lybarger and Reese testified that Vail stated that if the union pursued the grievance, O'Bryan could relocate some union work to other plants, thereby providing a justification for later eliminating the third shift. Vail also stated that when union members voted on whether to pursue the grievance regarding the third shift to arbitration, union officers should inform them about the importance of the issue and advise them on how to vote.

On November 12, 1992, the union executive board debated whether to arbitrate the grievance. Although Reese and Lybarger told them that petitioner might eliminate the third shift if the union pursued the grievance, the board issued a recommendation to employees to vote to proceed to arbitration. On November 15, 1992, twenty to thirty union members voted. Although Lybarger warned them about the possible consequences, the members voted to proceed.

Because only a third of unit members had voted, however, and because some members expressed concern about pursuing arbitration, Reese and Lybarger told Vail and Pifer that the union would like to hold another vote, and requested that petitioner not take any action until after the second vote. Lybarger testified that Vail responded that, because Reese and Lybarger were union officers, they "could persuade the vote and try to take care of the problem."

On December 13, 1992, the union membership again voted to pursue the grievance. The next day, Vail told Reese and Lybarger that petitioner was eliminating the third shift immediately. Petitioner acted without providing prior notice or opportunity to bargain collectively. Petitioner moved twelve of the third-shift employees to the other two shifts and terminated the remaining five workers. The elimination of the third shift also resulted in the termination of Reese as other employees exercised their seniority rights, although he had not been part of that shift.

Petitioner introduced evidence at the hearing that, shortly before the lay offs, it had lost 1.2 million dollars in annual revenue because it had lost two lucrative contracts with J.C. Penney and the State of Ohio. It also introduced evidence that it had begun to consider eliminating the third shift for economic reasons in April, 1992, and that it had laid off other employees in November and December of 1992 to reduce labor and overhead costs.

Vail testified that he did not threaten to eliminate the third shift if the union pursued its grievance. He also stated that petitioner previously had eliminated the third shift without incident, and that closing the shift reduced labor costs and did not increase overtime hours significantly. Finally, he asserted that petitioner had attempted to respond to declining business by withdrawing several bids in late 1992 in order to save costs.

In 1993, petitioner purchased CC Direct, a company in Pennsylvania, and moved the operation, including twelve employees, to the Shelby facility. Reese and Lybarger met with Pifer in March, 1993 to discuss the desire of the union to organize the twelve new employees. Lybarger and Reese testified that Pifer told them that the union should not attempt to organize the new workers because petitioner might respond by removing the CC Direct work from the Shelby plant. Although the union later attempted to represent the new employees, petitioner did not remove the work.

The ALJ determined that petitioner had violated the NLRA by (1) threatening to eliminate the third shift if the union pursued its grievance; (2) eliminating the third shift in retaliation for having pursued the grievance (3) terminating Dan Reese for similar reasons; (4) failing to provide notice and an opportunity to bargain before eliminating the third shift; and (5) threatening to relocate work from the plant if the union attempted to organize the employees acquired from CC Direct. The ALJ rejected the assertions by petitioner that it eliminated the shift for business reasons, that the collective bargaining agreement allowed it to eliminate the shift without prior notice or bargaining, and that the statements of Pifer during the March, 1993 meeting were too ambiguous to constitute threats. The ALJ also rejected the argument by petitioner that statements by Vail and Pifer during their discussions with Reese and Lybarger were inadmissible as settlement discussions.

Petitioner appealed to the Board, which largely affirmed the findings and conclusions of the ALJ and adopted without discussion most of the opinion issued by the ALJ. The Board did note that the ALJ had made certain factual errors when assessing the evidence provided by petitioner in support of its claim that it eliminated the third shift for economic reasons. The Board nonetheless upheld the credibility findings and ultimate conclusions of the ALJ on the basis of the other evidence. The Board further declined to review whether the lay off of Reese represented an independent violation of the NLRA because it determined that his lay off was linked inextricably with the illegal elimination of the third shift.

Petitioner has filed a timely appeal of the rulings by the Board, and respondent has filed a cross-appeal seeking to enforce them. We have jurisdiction pursuant to 29 U.S.C. § 160(f).

II.

A.

Before petitioner eliminated the third shift, it neither provided notice to, nor attempted to bargain with, the union. Petitioner claims that the terms of its collective bargaining agreement with the union allowed it to take such unilateral action.

A union has the statutory right to bargain over "wages, hours, and other terms and conditions of employment," see 29 U.S.C. § 158(d), and an employer may not alter unilaterally a condition of employment which is the subject of mandatory bargaining. See id. at §§ 158(a)(1),(a)(5); see also First Nat'l Maintenance Corp. v. NLRB, 452 U.S. 666, 674-75, 101 S.Ct. 2573, 2578-79, 69 L.Ed.2d 318 (1981); Litton Microwave Cooking Prods. Div., Litton Sys., Inc. v. NLRB, 868 F.2d 854, 857 (6th Cir.1989). Although a union can waive its statutory right to bargain, such a waiver must be "clear and...