International Union, United Auto., Aerospace & Agr. Implement Workers of America v. Dole, 88-5109

Citation869 F.2d 616
Decision Date10 March 1989
Docket NumberNo. 88-5109,88-5109
Parties130 L.R.R.M. (BNA) 2801, 276 U.S.App.D.C. 178, 57 USLW 2541, 111 Lab.Cas. P 11,008 INTERNATIONAL UNION, UNITED AUTOMOBILE, AEROSPACE & AGRICULTURAL IMPLEMENT WORKERS OF AMERICA, et al., Appellees, v. Elizabeth DOLE, Secretary of Labor, et al., Appellants.
CourtUnited States Courts of Appeals. United States Court of Appeals (District of Columbia)

On Appeal from the United States District Court for the District of columbia.

Bruce G. Forrest, Atty., Dept. of Justice, with whom John R. Bolton, Asst. Atty. Gen., Jay B. Stephens, U.S. Atty., Leonard Schaitman, Atty., Dept. of Justice, George R. Salem, Allen H. Feldman, Steven J. Mandel, and Bette J. Briggs, Attys., Dept. of Labor, were on the brief, for appellants.

Laurence Gold, and Laurence E. Gold, with whom Wendy L. Kahn, Jordan Rossen, and Leonard Page were on the brief, for appellees.

John S. Irving, Yosef J. Riemer, Stephen A. Bokat, Peter G. Nash, Jan Anundson, Robert Lewis, Francis T. Coleman, and Maurice Baskin were on the brief for amicus curiae, the Chamber of Commerce of the U.S., National Ass'n of Mfrs. of the U.S., American Soc. for Personnel Admin., American Retail Federation, Associated Builders and Contractors, Inc., and Master Printers of America, urging reversal of district court's opinion and affirmance of the Secretary's statutory interpretations.

Charles E. Sykes was on the brief for amicus curiae Kawasaki Motors Mfg. Corp., USA, urging reversal of district Before MIKVA, RUTH BADER GINSBURG, Circuit Judges, and HOGAN, District Judge. *

court's decision and affirmance of the Secretary's statutory interpretations.

Opinion for the court filed by Circuit Judge RUTH BADER GINSBURG.

RUTH BADER GINSBURG, Circuit Judge:

The Secretary of Labor (Secretary) seeks our review of a district court decision rejecting two Department of Labor (Department) interpretive rulings concerning the reports required of employers under section 203 of the Labor-Management Reporting and Disclosure Act of 1959 (LMRDA or Act), 29 U.S.C. Sec. 433 (1982). One of the contested rulings concerns payments to consultants to devise for the employer's use personnel policies to discourage unionization. The other concerns anti-union activities engaged in by supervisors, for which the supervisors receive no pay beyond their regular salaries. We conclude that the LMRDA is silent or ambiguous with respect to the issues before us and that the Secretary rationally construed the statute in ruling that reporting is not required in the circumstances she addressed. See Chevron U.S.A. Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837, 842-43, 104 S.Ct. 2778, 2781-82, 81 L.Ed.2d 694 (1984). We therefore reverse the district court's judgment for plaintiffs and remand with instructions to enter judgment for defendants.

I.

This case evolved from a March 1982 complaint filed with the Secretary of Labor by the International Union, United Automobile, Aerospace and Agricultural Implement Workers of America (UAW or Union). The UAW alleged that Kawasaki Motor Corporation and its attorney-consultants had engaged in anti-union conduct that should have been reported under section 203(a), (b) of the LMRDA, 29 U.S.C. Sec. 433(a), (b). In September 1982, the Secretary having declined to take enforcement action, the Union commenced an action in district court for declaratory relief and to compel the Department of Labor to proceed against Kawasaki. Concluding that it lacked authority to review the Department's decision not to take enforcement action, see Heckler v. Chaney, 470 U.S. 821, 105 S.Ct. 1649, 84 L.Ed.2d 714 (1985), the district court dismissed the complaint. International Union, United Automobile, Aerospace & Agricultural Implement Workers v. Donovan, 577 F.Supp. 398 (D.D.C.1983).

We reversed in part. International Union, United Automobile, Aerospace & Agricultural Implement Workers v. Brock, 783 F.2d 237 (D.C.Cir.1986). Acknowledging that the Department's decision not to proceed against Kawasaki and its attorneys was unreviewable in court, we nonetheless declared reviewable the Secretary's announcement of two substantive positions in a January 1983 Statement of Reasons: 1

1) A consultant's activity is properly "characterized as advice [and therefore exempt from reporting under section 203(c) of the LMRDA, 29 U.S.C. Sec. 433(c) ] if it is submitted orally or in written form to the employer for his use, and the employer is free to accept or reject the oral or written material submitted to him."

2) "[E]mployers are not required to report regular wages paid to regular supervisors and other employees."

783 F.2d at 243 (quoting Statement of Reasons at 3, 5). Holding that the Union "may challenge the announced statutory interpretations as arbitrary, capricious, or contrary to law," we "remand[ed] the case to the district court to consider those challenges." 783 F.2d at 252. From the district court's

decision declaring the Secretary's constructions impermissible and accordingly granting summary judgment to the UAW, International Union v. Secretary of Labor, 678 F.Supp. 4 (D.D.C.1988), the Secretary pursues this appeal.

II.

We consider first the Secretary's announcement that a consultant law firm does not engage in reportable activity under the LMRDA when it devises personnel policies to discourage unionization, so long as the work product, whether written or oral, "is submitted ... to the employer for his use, and the employer is free to accept or reject [the submission]." Statement of Reasons at 3. The Secretary contrasted activity that would not constitute advice: "where the attorney-consultant has direct contact with employees or he himself engages in the persuader activity alleged." Id.

Underlying the Secretary's ruling and the district court's opposing view is a tension between the coverage provisions of the LMRDA, and the Act's exemption for advice. Section 203, the section at issue, initially instructs, in subsections (a)(4) and (b), reporting by employers and consultants of any arrangements for activities that have as "an object" the direct or indirect persuasion of employees with respect to the exercise or non-exercise of their organizational and bargaining rights. 29 U.S.C. Sec. 433(a)(4), (b). But the next prescription, set out in subsection (c), directs: "Nothing in this section [i.e., section 203] shall be construed to require any employer or other person to file a report covering the services of such person by reason of his giving or agreeing to give advice...." 29 U.S.C. Sec. 433(c).

The district court acknowledged that "Congress intended to grant broad scope to the term 'advice.' " 678 F.Supp. at 6 (citing H.R. CONF. REP. No. 1147, 86th Cong., 1st Sess. 33 (1959), reprinted in 1 National Labor Relations Board, Legislative History of the Labor-Management Reporting and Disclosure Act 937, 1959 U.S. CODE CONG. & ADMIN. NEWS 2503, 2505). 2 Nonetheless, that court also stressed the legislature's intention to cover comprehensively employer-consultant endeavors (direct or indirect) to persuade employees regarding labor organization. In the overlap area, the district court indicated, where the activity might be characterized both as advice to the employer and as persuasion of employees, the coverage section controls: "[W]hatever may be the scope of the term 'advice,' it does not exempt from the reporting requirement activities that amount to persuasion." 678 F.Supp. at 6. A "persuasion" of employees objective, the district court concluded, renders the "advice" exemption "inapplicable." Id. at 7. Advising employers (including supervisors) how to persuade employees against unionization, the district court therefore held, could not qualify for exemption.

The Secretary reconciles section 203's coverage and exemption prescriptions differently. If the arrangement is one solely for advice to the employer and his supervisor representatives, then it matters not, according to the Secretary, that the advice has as "an object" employee persuasion. The very purpose of section 203's exemption prescription, the Secretary maintains, is to remove from the section's coverage certain activity that otherwise would have been reportable. In the overlap area, the Secretary thus concludes, the exemption direction, not the coverage provision, generally must control. 3

Given the tension Congress created, and the deference due the Secretary's reconciliation, we cannot call arbitrary her view that if an activity is properly characterized as "advice," reporting generally is not required. We therefore proceed to inquire whether the Secretary has reasonably delineated what constitutes advice within the meaning of section 203(c), 29 U.S.C. Sec. 433(c). The statute itself, always the starting point, nowhere attempts a definition of the term. See Memorandum from Charles Donahue, Solicitor of Labor, to John L. Holcombe, Commissioner, Bureau of Labor-Management Reports, at 1 (Feb. 19, 1962) [hereafter Donahue Memo].

In a 1962 effort to describe the "advice" exemption, LMRDA Interpretative Manual Entry Sec. 265.005 (Jan. 19, 1962) (Scope of the "Advice" Exemption) [hereafter Manual], the Department contrasted 1) material a consultant delivers directly to employees to persuade them regarding organizational rights, with 2) material the employer drafts, then refers to a consultant for review or revision. The first category falls outside, and the second, inside, the advice exemption. There is no dispute over either of these rankings.

The "more difficult" to classify cases, the Department has acknowledged, involve presentations for and to the employer prepared entirely by the consultant, e.g., a fully scripted speech for supervisors to deliver. 4 In such cases, it has been the Department's policy that

where the employer is free to accept or reject the written material prepared for him and there is no indication that the middleman is operating under a...

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