MESA VERDE CONST. v. N. CAL. DIST. COUNCIL OF LABOR.

Citation598 F. Supp. 1092
Decision Date13 December 1984
Docket NumberNo. C-84-4389-WWS.,C-84-4389-WWS.
PartiesMESA VERDE CONSTRUCTION CO., Plaintiff, v. NORTHERN CALIFORNIA DISTRICT COUNCIL OF LABORERS, Defendant.
CourtUnited States District Courts. 9th Circuit. United States District Courts. 9th Circuit. Northern District of California

Mark R. Thierman, Deborah E.G. Wilder, Thierman, Simpson & Cook, San Francisco, Cal., for plaintiff.

Victor J. Van Bourg, Van Bourg, Weinberg, Roger & Rosenbeld, San Francisco, Cal., for defendant.

ORDER

SCHWARZER, District Judge.

Plaintiff Mesa Verde Construction Company ("Mesa Verde") brings this action against Defendant Northern California District Council of Laborers ("the Union") seeking a declaration that it is not obligated to arbitrate a grievance under the terms of an agreement with the Union. Mesa Verde contends that the agreement was a pre-hire agreement within the meaning of § 8(f) of the National Labor Relations Act (the Act), 29 U.S.C. § 158(f) (1976)1 and was repudiated before the date on which the grievance was filed.

FACTS

Mesa Verde has performed contracting work in California since June 1977. On August 13, 1979, it entered into a memorandum agreement with the Union. The memorandum agreement incorporated an industry master agreement which is not before the Court, and provided that it would remain in effect until June 15, 1980, and continue from year to year thereafter unless either party gave written notice of intention to change or cancel by April 15th. This agreement remained in effect until a second memorandum agreement was signed on June 26, 1980, incorporating by reference all of the terms and conditions of the 1980-83 Master Agreement between the Associated General Contractors of California, Inc. and the Northern California District of Laborers. This memorandum agreement provided that it would remain in full force and effect until June 15, 1983, and continue from year to year thereafter unless either party gave written notice within the time provided in the agreement.

On November 17, 1982, the terms of the June 1980 agreement were modified and extended to June 15, 1986. It is the June 1980 agreement which is the subject of this action.

The Master Agreement defined the scope of covered laborers' work and designated the counties to which it applied. That agreement also contained a union security clause requiring any employee on the job for more than eight days to join the Union.

On May 15, 1984, Mesa Verde's attorney sent a letter to the Union stating that Mesa Verde was abrogating "any and all agreements" with the Union. As of that date, Mesa Verde operated on only one jobsite, the Lucky Hercules Project. Thereafter, in June, 1984, the Union filed a grievance against Mesa Verde with respect to work at a different jobsite at Orland, California, after May 27, 1984.

Mesa Verde brings this action seeking relief in the form of a declaration that it is not obligated to arbitrate this grievance which arose at a new jobsite after its notice of termination. Jurisdiction is premised on § 301 of the Act. On July 16, 1984, this Court stayed arbitration of the grievance pending resolution of Mesa Verde's declaratory relief action. A motion to reconsider that stay was denied on August 31. Mesa Verde now moves for summary judgment. Inasmuch as no material facts are in dispute, disposition by summary judgment is appropriate.

DISCUSSION

Mesa Verde's motion and the Union's opposition raise three issues:

1. Was the agreement repudiated on May 15, 1984, a pre-hire agreement within the meaning of § 8(f)?

2. If the agreement was a pre-hire agreement, is this court a proper forum to determine whether the repudiation was effective?

3. If the court may make that determination, was the letter sent to the Union effective to repudiate the agreement?

I. Was the Agreement a Pre-Hire Agreement?

Mesa Verde asserts that it was free to repudiate the memorandum agreement because that agreement did not become a binding collective bargaining agreement but was only a voidable pre-hire agreement under § 8(f).

Although it is an unfair labor practice for an employer to sign a collective bargaining agreement recognizing a minority union as an exclusive bargaining representative, International Ladies' Garment Workers Union v. NLRB, 366 U.S. 731, 737-39, 81 S.Ct. 1603, 1607-08, 6 L.Ed.2d 762 (1961), to accommodate the fluidity of construction industry employment, § 8(f) allows an employer in that industry to execute a pre-hire agreement before a majority is established. Jim McNeff, Inc. v. Todd, 461 U.S. 260, 103 S.Ct. 1753, 1756-57, 75 L.Ed.2d 830 (1983). While the statute by its terms does not provide for repudiation, the Supreme Court has held that parties may repudiate pre-hire agreements "until and unless such time as the union achieves majority support in the relevant bargaining unit." Jim McNeff, Inc. v. Todd, 103 S.Ct. at 1753-54; NLRB v. Local Union No. 103, International Association of Bridge, Structural and Ornamental Ironworkers, 434 U.S. 335, 345, 98 S.Ct. 651, 657, 54 L.Ed.2d 586 (1978) ("Higdon"). Once a union achieves majority status, "the pre-hire agreement attains the status of a collective bargaining agreement executed by the employer with a union representing a majority of the employees in the unit." Higdon, 434 U.S. at 350, 98 S.Ct. at 660. Majority status thus converts a voidable § 8(f) agreement into a binding collective bargaining agreement under § 9(a).

A. Jurisdiction

The Union contends that before majority status can be ascertained, a determination of the appropriate bargaining unit must be made. The Union argues that the court is without jurisdiction to determine the appropriate bargaining unit and therefore cannot reach the question of majority status. It is true that "bargaining unit determination is a representational question reserved in the first instance to the Board ... and a district court does not have jurisdiction to address this question in a section 301 suit." Carpenters Local Union No. 1478 v. Stevens, 743 F.2d 1271, at 1278 (9th Cir.1984). The primary jurisdiction rule, however, does not apply where the party raising the issue has no standing to raise it before the National Labor Relations Board. Laborers Health & Welfare Trust Fund v. Kaufman & Broad of Northern California, Inc., 707 F.2d 412, 415-16 (9th Cir.1983). This rationale was recently extended to defenses which cannot be presented to the Board. Operating Engineers Pension Trust v. Beck Engineering & Surveying Co., 746 F.2d 557, at 565 (9th Cir.1984).

The Union's argument is premised on the notion that effective repudiation of a pre-hire agreement can only follow a determination of the appropriate bargaining unit in connection with a representation election. The case before this Court, however, involves a repudiation as to future jobsites for which no laborers have yet been hired. No bargaining unit determination could be made with respect to non-existent jobs nor could an election be held. The Union's argument is therefore irrelevant.

B. Majority Status

Majority status sufficient to convert a voidable § 8(f) agreement into a binding § 9(a) agreement may be established in one of two ways:

If the agreement covers a permanent and stable unit of employees, the contract is converted into a binding agreement covering all employees from the time the union establishes majority support. Once a majority of the company employees belong to the union, a rebuttable presumption of the union's majority status is created.
If an employer has no stable workforce and hires on a job-to-job basis, "the employer's duty to bargain and honor the contract is contingent on the union's attaining majority support at the various construction sites." Higdon, 434 U.S. at 345 98 S.Ct. at 657. "The union must demonstrate its majority status at each new jobsite in order to invoke the provisions of section 8(a)(5) of the Act." Construction Erectors, Inc. v. N.L.R.B., 661 F.2d 801, 804 (9th Cir.1981) (citing Hageman Underground Construction, 253 N.L.R.B. 60 (1980)).
N.L.R.B. v. Pacific Erectors, Inc., 718 F.2d 1459, 1463 (9th Cir.1983).

The Union makes three arguments. First, the Union argues that because it first entered into an agreement with Mesa Verde in 1979, the subsequent June 26, 1980, agreement was a part of an existing bargaining relationship and therefore could not be a pre-hire agreement. The National Labor Relations Board has held that the concept of a pre-hire agreement applies only to the initial § 8(f) agreement and not to succeeding contracts. See e.g. Custom Sheet Metal and Service Co., 243 N.L.R.B. 1102 (1979); Williams Enterprise, Inc., 212 N.L.R.B. 880 (1974), enforced 89 LRRM 2190 (4th Cir.1975); Dallas Building & Construction Trades Council, 164 N.L.R.B. 938 (1967), enforced 396 F.2d 677 (D.C.Cir.1968); Bricklayers & Masons Local 3, 162 N.L.R.B. 476 (1966), enforced 405 F.2d 469 (9th Cir.1968). Thus in Bricklayers & Mason Local 3, the Board enforced a collective bargaining agreement whose origin was a pre-hire agreement. The Board found this origin to be irrelevant in light of the subsequent dealings between the parties:

It is apparent from the foregoing that the bargaining between the AGC and the Union presents the situation of a continuing bargaining relationship; a situation quite different from that which Congress had in mind when enacting Section 8(f)(1), to wit, an initial attempt by a union and an employer in the construction industry to commence such a relationship. Thus, the entire legislative history of Section 8(f)(1) is couched in terms of "prehire agreement," a reference which can have no meaning is the situation where, as here, the parties are continuing an existing bargaining relationship under which employees have previously been hired. 162 NLRB at 478

These cases, however, in which the Board determined that successive agreements could not be characterized as § 8(f) agreements, involved what Pacific Erectors described as a permanent and stable workforce. But when an employer hires on a...

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