Grinnell Fire Protection Systems v. Nat'l Labor Relations Bd.

• Citation: 236 F.3d 187
• Decision Date: 08 June 2000
• Docket Number: No. 99-1900,AFL-CIO,P,No. 99-2212,I,No. 99-1754,AFL-CI,R,99-1754,99-1900,99-2212
• Parties: (4th Cir. 2000) GRINNELL FIRE PROTECTION SYSTEMS COMPANY, Petitioner, v. NATIONAL LABOR RELATIONS BOARD, Respondent, SPRINKLER FITTERS LOCAL UNION 669, United Association of Journeymen and Apprentices of the Plumbing and Pipefitting Industry of the United States and Canada,; UNITED ASSOCIATIONOF JOURNEYMENAND APPRENTICESOF THE PLUMBINGAND PIPEFITTING INDUSTRYOF THE UNITED STATESAND CANADA,, Intervenors. SPRINKLER FITTERS LOCAL UNION 669, United Association of Journeymen and Apprentices of the Plumbing and Pipefitting Industry of the United States and Canada,; UNITED ASSOCIATION OF JOURNEYMEN AND APPRENTICESOF THE PLUMBINGAND PIPEFITTING INDUSTRYOF THE UNITED STATES AND CANADA,, Petitioners, v. NATIONAL LABOR RELATIONS BOARD, Respondent, GRINNELL FIRE PROTECTION SYSTEMS COMPANY, Intervenor. NATIONAL LABOR RELATIONS BOARD, Petitioner, v. GRINNELL FIRE PROTECTION SYSTEMS COMPANY, SPRINKLER FITTERS LOCAL UNION 669, United Association of Journeymen and Apprentices of the Plumbing and Pipefitting Industry of the United States and Canada,; UNITED ASSOCIATIONOF JOURNEY MEN AND APPRENTICES OF THE PLUMBINGAND PIPEFITTING INDUSTRY OF THE UNITED STATES AND CANADA,, Respondents. . Argued:
• Court: United States Courts of Appeals. United States Court of Appeals (4th Circuit)

Page 187

236 F.3d 187 (4th Cir. 2000)

GRINNELL FIRE PROTECTION SYSTEMS COMPANY, Petitioner, v. NATIONAL LABOR RELATIONS BOARD, Respondent, SPRINKLER FITTERS LOCAL UNION 669, United Association of Journeymen and Apprentices of the Plumbing and Pipefitting Industry of the United States and Canada, AFL-CIO; UNITED ASSOCIATIONOF JOURNEYMENAND APPRENTICESOF THE PLUMBINGAND PIPEFITTING INDUSTRYOF THE UNITED STATESAND CANADA, AFL-CIO, Intervenors.

SPRINKLER FITTERS LOCAL UNION 669, United Association of Journeymen and Apprentices of the Plumbing and Pipefitting Industry of the United States and Canada, AFL-CIO; UNITED ASSOCIATION OF JOURNEYMEN AND APPRENTICESOF THE PLUMBINGAND PIPEFITTING INDUSTRYOF THE UNITED STATES AND CANADA, AFL-CIO, Petitioners, v. NATIONAL LABOR RELATIONS BOARD, Respondent, GRINNELL FIRE PROTECTION SYSTEMS COMPANY, Intervenor.

NATIONAL LABOR RELATIONS BOARD, Petitioner, v. GRINNELL FIRE PROTECTION SYSTEMS COMPANY, SPRINKLER FITTERS LOCAL UNION 669, United Association of Journeymen and Apprentices of the Plumbing and Pipefitting Industry of the United States and Canada, AFL-CIO; UNITED ASSOCIATIONOF JOURNEY MEN AND APPRENTICES OF THE PLUMBINGAND PIPEFITTING INDUSTRY OF THE UNITED STATES AND CANADA, AFL-CIO, Respondents.

No. 99-1754 No. 99-1900 No. 99-2212.

UNITED STATES COURT OF APPEALS, FOR THE FOURTH CIRCUIT.

Argued: June 8, 2000.

Decided: December 29, 2000.

On Petitions for Review and Cross-application of Orders of the National Labor Relations Board. (5-CA-24521, 5-CA-25227, 5-CA-25406)

[Copyrighted Material Omitted]

COUNSEL ARGUED: Joel Harvey Kaplan, SEYFARTH, SHAW, FAIR-WEATHER & GERALDSON, Chicago, Illinois, for Grinnell. David Arthur Fleisher, Senior Attorney, NATIONAL LABOR RELATIONS BOARD, Washington, D.C., for Board. William Walter Osborne, Jr., OSBORNE LAW OFFICES, P.C., Washington, D.C., for Local 669, et al. ON BRIEF: Christopher A. Weals, Charles F. Walters, SEY-FARTH, SHAW, FAIRWEATHER & GERALDSON, Washington, D.C., for Grinnell. Leonard R. Page, General Counsel, Linda Sher, Associate General Counsel, Aileen A. Armstrong, Deputy Associate General Counsel, NATIONAL LABOR RELATIONS BOARD, Washington, D.C., for Board. Robert Matisoff, Nicholas Femia, O'DONOGHUE & O'DONOGHUE, Washington, D.C., for Local 669, et al.

Before NIEMEYER and KING, Circuit Judges, and Irene M. KEELEY, United States District Judge for the Northern District of West Virginia, sitting by designation.

Petitions for review denied and cross-application for enforcement granted by published opinion. Judge King wrote the opinion, in which Judge Keeley concurred. Judge Niemeyer wrote a concurring and dissenting opinion.

OPINION

KING, Circuit Judge:

Grinnell Fire Protection Systems Company ("Grinnell") petitions this Court, pursuant to 29 U.S.C. § 160(f), to review the decision of the National Labor Relations Board (the "Board") that Grinnell engaged in unfair labor practices, in violation of the National Labor Relations Act ("the Act"). The Board, by its May 28, 1999 Decision and Order ("Order"),¹ upheld the decision of its Administrative Law Judge ("ALJ").² The Order determined that Grinnell's implementation of its final contract offer, after failing to reach a collective bargaining agreement ("agreement") with the representative of its employees, constituted an unfair labor practice because "there was no impasse in bargaining."

Grinnell's employees are represented by Local 669 ("Local 669") of the United Association of Journeymen and Apprentices of the Plumbing and Pipe Fitting Industry (collectively"the Union"). The Union also petitions for our review of the Order insofar as the Board concluded that Grinnell did not engage in unfair labor practices prior to the company's implementation of its final contract offer. For the reasons explained below, we deny the petitions for review filed by Grinnell and the Union, and we grant the Board's cross-application for enforcement of its Order.

I.

After its unsuccessful attempt to negotiate a new agreement with the Union, Grinnell, on April 14, 1994, declared an impasse and implemented its final contract offer. Immediately thereafter, the Union filed unfair labor practice charges against Grinnell with the Board. Our summary of the relevant facts underlying this dispute, recounted below, is largely drawn from the ALJ's decision of January 16, 1997.

A. BACKGROUND

Grinnell, a subsidiary of Tyco International Ltd. ("Tyco"), is engaged in the design, fabrication, sale, and installation of fire sprin- kler systems. For many years, Grinnell had been represented in its collective bargaining with the Union by a multiemployer bargaining group known as the National Fire Sprinkler Association (NFSA), a trade association of over 150 fire sprinkler contractors. In 1992, the Union had instituted a program known as "targeting" to assist signa- tory contractors, including Grinnell, in competing with lower-cost non-union contractors. Under the Union's targeting program, the par- ties were sometimes able to negotiate concessionary wage rates, which permitted a NFSA member to pay lower wages or other bene- fits to journeyman fitters on a project-by-project basis in certain geo- graphical areas. Jobs that included targeting of wages were referred to as "targeted" jobs. Under the program, the Union retained final authority to grant an employer's request to target a project with a reduced rate.

From the inception of the targeting program, Grinnell, the largest fire sprinkler manufacturer and installer in the United States, had been its primary user. However, in May 1993, the Union added a new requirement to its targeting program: in order to participate in target- ing after June 1, 1993, a company was obliged to commit to remain part of the NFSA multiemployer bargaining group through negotiation of the next agreement (or, in the alternative, consent to be bound by the agreement negotiated between the Union and NFSA effective April 1, 1994).

Grinnell declined to accept this new condition; as a result, the Union withdrew Grinnell's participation from the targeting program. Grinnell responded with a letter, dated September 22, 1993, in which it revoked NFSA's bargaining authority, provided notice of termination of the existing agreement between the parties (due to expire March 31, 1994), and requested immediate negotiations with the Union for a new agreement.

B. THE NEGOTIATIONS

1. The Early Negotiations

On January 28, 1994, Grinnell provided the Union with a proposal for a new agreement, its first proposal following Grinnell's revocation of NFSA's bargaining authority. This proposal contained significant changes to the existing agreement in the areas of wages, job classifi- cations, benefits, and pension plans.³

Grinnell and the Union thereafter entered into contract negotia- tions, with the first session being conducted on March 17, 1994, in Bethesda, Maryland. At this first session, Grinnell's counsel, Peter Chatilovicz, acted as its chief negotiator. Chatilovicz explained Grin- nell's reasons for withdrawing bargaining authority from NFSA, and he expressed the company's desire that, by bargaining independently with the Union, it would be able to reach an agreement that would resolve its major competitive problems. Grinnell then presented a new proposal to the Union, revised somewhat from its January 28, 1994 proposal.

Under its revised proposal of March 17, Grinnell would possess the option to apply targeting to any project where there was non-union competition. The fixed targeting rate would be tied to the journeyman wage rate in the particular state, but it would be no lower than 65% of that rate. Chatilovicz made clear to the Union that Grinnell's goal was to control targeting, rather than leave the matter to the Union's discretion. Grinnell also proposed replacing the existing benefits plan with one common to Tyco employees. While the parties engaged in no other significant discussions, they reached consensus that any new agreement would be for a term of three years. The Union requested an overnight recess so that it could study Grinnell's revised proposal.

The parties met again the next day, March 18, to discuss Grinnell's revised proposal. During this meeting, Grinnell offered to increase the minimum targeting rate to 75% of the journeyman wage rate, up from the prior offer of 65%. The applicability of these rates would not to be subject to grievance procedures, but would be within Grinnell's sole discretion to impose -- immune from all review by the Union absent allegations that the company had misused its targeting author- ity. The Union did not then indicate whether it could accept Grinnell's targeting terms, but it did present a counter wage proposal calling for incremental annual increases in the journeyman hourly rate and a $.25 increase in the differential for foremen. The parties agreed to meet again in ten days, on March 28, 1994.

Shortly thereafter, an important change of circumstances occurred. On March 22, 1994, the Union issued to its members a strike notice directed at Grinnell and NFSA. Upon receiving the notice, Grinnell sought a five-day renewable extension of the existing agreement, which the Union denied. By letter dated March 24, 1994, Grinnell informed its employees that, in the event of a strike, it would hire per- manent replacement workers. Ensuing controversy within the Union caused its president to place Local 669 in trusteeship, and the negoti- ating session scheduled for March 28, 1994, was cancelled.

Effective March 28, 1994, Tommy Preuett, a former president and business manager of Local 669, was appointed as the Union's trustee. As trustee, Preuett was empowered to manage the Union's affairs, including the negotiation of new agreements with NFSA, Grinnell, and other independent contractors.

2. Preuett Begins to Bargain⁴

On March 30, 1994, the first bargaining session between Grinnell and the Preuett-led Union took place in New...