U.S. Marine Corp. v. N.L.R.B.

• Decision Date: 25 September 1991
• Docket Number: AFL-CIO,Nos. 89-2051,89-2140 and 89-2152,s. 89-2051
• Citation: 944 F.2d 1305
• Parties: 138 L.R.R.M. (BNA) 2361, 120 Lab.Cas. P 10,986 U.S. MARINE CORPORATION and Bayliner Marine Corporation, Petitioners/Cross-Respondents, v. NATIONAL LABOR RELATIONS BOARD, Respondent/Cross-Petitioner, International Union, Allied Industrial Workers of America,, et al., Intervening Respondent. INTERNATIONAL UNION, ALLIED INDUSTRIAL WORKERS OF AMERICA,, et al., Petitioner, v. NATIONAL LABOR RELATIONS BOARD, Respondent.
• Court: U.S. Court of Appeals — Seventh Circuit

Page 1305

944 F.2d 1305

138 L.R.R.M. (BNA) 2361, 120 Lab.Cas. P 10,986

U.S. MARINE CORPORATION and Bayliner Marine Corporation, Petitioners/Cross-Respondents, v. NATIONAL LABOR RELATIONS BOARD, Respondent/Cross-Petitioner,

International Union, Allied Industrial Workers of America,

AFL-CIO, et al., Intervening Respondent.

INTERNATIONAL UNION, ALLIED INDUSTRIAL WORKERS OF AMERICA, AFL-CIO, et al., Petitioner, v. NATIONAL LABOR RELATIONS BOARD, Respondent.

Nos. 89-2051, 89-2140 and 89-2152.

United States Court of Appeals,

Seventh Circuit.

Argued Dec. 5, 1989.

Decided Oct. 18, 1990.

Reheard En Banc June 11, 1991.

Decided Sept. 25, 1991.

Fred G. Groiss, Quarles & Brady, Milwaukee, Wis., James D. Holzhauer (argued), Mayer, Brown & Platt, Chicago, Ill., for petitioners/cross-respondents.

Kenneth R. Loebel (argued), Previant, Goldberg, Uelman, Gratz, Miller & Brueggeman, Milwaukee, Wis., for intervening respondent, petioner.

Steven B. Goldstein, Contempt Litigation Branch, Washington, D.C., Fred G. Groiss, Quarles & Brady, Milwaukee, Wis., Aileen A. Armstrong, Linda J. Dreeben (argued), Appellate Court, Enforcement Litigation, Washington, D.C., Joseph A. Szabo, Director, N.L.R.B., Region 30, Milwaukee, Wis., James D. Holzhauer (argued), Mayer, Brown & Platt, Chicago, Ill., for respondent.

Before BAUER, Chief Judge, and CUMMINGS, WOOD, Jr., CUDAHY, POSNER, COFFEY, FLAUM, EASTERBROOK, RIPPLE, MANION and KANNE, Circuit Judges.

RIPPLE, Circuit Judge.

U.S. Marine Corporation, Bayliner Marine Corporation, and the International Union, Allied Industrial Workers of America, AFL-CIO, seek review of an order of the National Labor Relations Board (the Board); the Board seeks enforcement of that order. For the following reasons, we deny the petitions for review and enforce the order.

I

BACKGROUND

A. The Board's Findings of Fact ¹

This successorship case involves the rights and responsibilities of U.S. Marine Corporation and its parent company, Bayliner Marine Corporation, as a result of their purchase of Chrysler Marine Corporation. The issues presented on appeal require a plenary statement of the facts. To

                facilitate the reader's understanding of the factual background of the case, we shall subdivide our presentation of the facts into three headings:  (1) the purchase by Bayliner;  (2) the hiring process of U.S. Marine;  and (3) the post-purchase labor-management relations of U.S. Marine and the Union.   However, we also forewarn the reader that, at a later point in the analysis, a strict chronological understanding of events, necessarily sacrificed somewhat by the format described, will be necessary
                

1. The purchase by Bayliner

Chrysler Marine Corporation (Chrysler), a subsidiary of the Chrysler Corporation, manufactured marine and industrial engines from 1965 until 1984 at a facility in Hartford, Wisconsin. In 1983, the parent company decided to sell Chrysler and entered into negotiations with Bayliner Marine Corporation (Bayliner) for the sale of the Hartford facility. Chrysler and Bayliner signed a letter of intent, subject to the negotiation of specific terms, on October 20, 1983. In anticipation of the transaction, the stockholders and directors of Bayliner organized U.S. Marine Corporation on December 5, 1983 as a vehicle to purchase Chrysler. ² James W. Hoag, Bayliner's vice-president of administration, was assigned to be general manager and chief operations officer of the Hartford plant once the purchase was completed. He also was responsible for hiring new employees to staff the plant.

During the time that Chrysler owned the Hartford facility, the International Union, Allied Industrial Workers of America, AFL-CIO, and Local 879 (the Union) represented Chrysler's production and maintenance employees. ³ The fate of these employees was a significant issue throughout the course of negotiations between Chrysler and U.S. Marine. Chrysler repeatedly sought assurances that U.S. Marine would hire Chrysler's employees. However, U.S. Marine made it clear to the Union, Chrysler, and Chrysler's employees that it (1) would hire only the most qualified applicants, irrespective of whether they formerly worked for Chrysler, although former Chrysler workers were encouraged to apply, (2) anticipated hiring at least eighty-five per cent of the former Chrysler employees, (3) would not recognize the Union, and (4) planned to hire its employees under its own wage plan and working conditions and therefore would not observe the terms and conditions of employment in effect under Chrysler. James Hoag specifically advised several Union officials at a meeting on December 13, 1983 that he "had no intention of recognizing the union," "wanted no part of the contract [between Chrysler and the Union]," and "was too busy to sit down and meet with the union." Tr. at 691, 692.

The Union reacted to this information by seeking to enjoin the sale of Chrysler to U.S. Marine. The Union sought the injunction on the ground that the sale would violate the Union's collective bargaining agreement, which required Chrysler to give the Union six months notice of the closing of the Hartford facility and negotiate a severance pay plan. See Local 879, Allied Indus. Workers v. Chrysler Marine Corp., 819 F.2d 786, 787 (7th Cir.1987). On December 27, 1983 and in response to the lawsuit, Chrysler's associate general counsel requested J. Orin Edson, who was Bayliner's chairman and U.S. Marine Corporation's president, to testify or file an affidavit that U.S. Marine Corporation would hire a majority of the Chrysler employees. Mr. Edson refused, indicated that the company would not make a commitment regarding hiring, and in fact expected to hire less than fifty per cent of the Chrysler workers. Although Mr. Edson refused to accede to

                Chrysler's request, he authorized Mr. Hoag to file an affidavit.   In his affidavit of December 28, 1983, Mr. Hoag stated that (1) U.S. Marine had begun accepting applications and expected to have a representative complement of employees hired by early January, 1984, (2) applicants would be considered based on their relative qualifications, (3) union membership (or the lack thereof) would not enter into the hiring decision, (4) he believed a number of applicants would be former Chrysler employees and that such prior experience would be advantageous, and (5) applicants would receive an explanation of the terms and conditions of employment prior to being hired.   The district court granted a preliminary injunction, but this court granted a stay on January 9, 1984 and eventually reversed the injunction on May 31, 1984.   After the injunction was lifted, the transfer of the facility was finalized.   On Friday, January 13, 1984, Chrysler completed the sale to U.S. Marine, laid off its entire work force of 262 production and maintenance employees, and closed its doors
                

2. The hiring process of U.S. Marine

From Monday, January 16 through Friday, January 20, the company interviewed some 500 applicants and hired new employees. On January 20, after the first week of hiring was completed, the company's accounting department projected that U.S. Marine would require 396 employees actually on the job by June. This figure was based on information supplied by the company's manufacturing and marketing departments and did not reflect anticipated absentee rates. According to John Lombardo, U.S. Marine's human resources manager, U.S. Marine wanted to reopen the plant as quickly as possible. He further testified that in order to do so, the company required a skilled labor force composed of employees who had experience in the particular operations. Consequently, on Monday, January 23, U.S. Marine reopened the plant with a staff of 219 workers, all of whom were former Chrysler employees.

U.S. Marine continued to hire employees throughout the month of January. By January 25, the company had hired a total of 231 workers, 222 of whom were former Chrysler employees. Between January 25 and January 30, thirty more employees were hired, only one of whom had worked for Chrysler. Thus, on January 30, 1984, the last day a former Chrysler employee was hired, the U.S. Marine work force was composed of 261 production and maintenance employees, 223 of whom had worked previously for Chrysler.

Nearly all of the 262 former Chrysler workers had applied with U.S. Marine; of those who applied, U.S. Marine hired all but thirty-four. ⁴ There was a great deal of testimony concerning the skill level and versatility of the thirty-four former Chrysler employees not hired by U.S. Marine. ⁵ All of these workers had at least ten years seniority with Chrysler, but they never were informed why they had not been hired. After January 30, 1984, U.S. Marine did not hire any of the remaining Chrysler applicants, although its work force increased to as many as 323 employees. In sum, from January 23 to August 31, 1984, U.S. Marine's total employment ranged from 219 to 323 production and maintenance employees. During that time period, the number of former Chrysler employees ranged from 218 to 223.

3. Post-purchase labor-management relations of U.S. Marine and the Union

After it began operating the plant, U.S. Marine refused to discuss grievances with Union representatives during company time. The company also removed Union bulletin boards from the plant. At the On January 25, 1984, two days after the plant began operations under new management, at a time when 222 of the 231 U.S. Marine employees were former Chrysler workers, the Union requested recognition. The Union also asked that U.S. Marine furnish a list of names, addresses, job titles, and wage rates of all U.S. Marine employees and copies of all written manuals and handbooks describing the benefits then provided by U.S. Marine. The company, which was still involved in the hiring process, did not give the Union an immediate response.

                same time, the company established a "Safety and Progress Committee" composed of senior

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