Communication Workers of America, Local 5008 v. N.L.R.B.

• Decision Date: 03 March 1986
• Docket Number: Nos. 85-1924,85-2225,s. 85-1924
• Parties: 121 L.R.R.M. (BNA) 3078, 54 USLW 2472, 104 Lab.Cas. P 11,765 COMMUNICATION WORKERS OF AMERICA, LOCAL 5008, Petitioner, v. NATIONAL LABOR RELATIONS BOARD, Respondent, Illinois Bell Telephone Co., Intervenor.
• Court: U.S. Court of Appeals — Seventh Circuit

Page 847

784 F.2d 847

121 L.R.R.M. (BNA) 3078, 54 USLW 2472,

104 Lab.Cas. P 11,765

COMMUNICATION WORKERS OF AMERICA, LOCAL 5008, Petitioner, v. NATIONAL LABOR RELATIONS BOARD, Respondent Illinois Bell Telephone Co., Intervenor.

Nos. 85-1924, 85-2225.

United States Court of Appeals Seventh Circuit.

Argued Feb. 10, 1986.

Decided March 3, 1986.

Lincoln V. Janus, Illinois Bell Telephone, Co. Legal Dept., Chicago, Ill., for petitioner.

Judith Dowd, N.L.R.B., James Coppess, AFL-CIO, Legal Dept., Washington, D.C., for respondent.

Before BAUER, FLAUM and EASTERBROOK, Circuit Judges.

EASTERBROOK, Circuit Judge.

Section 7 of the National Labor Relations Act, 29 U.S.C. Sec. 157, requires employers that seek to conduct disciplinary interviews of employees to permit the employees to invite representatives of their union to the interviews. NLRB v. J. Weingarten, Inc., 420 U.S. 251, 95 S.Ct. 959, 43 L.Ed.2d 171 (1975). In 1977 the National Labor Relations Board concluded that it should order employers to reinstate, with back pay, employees fired after interviews from which union representatives had been excluded. Certified Grocers of California, 227 N.L.R.B. 1211, 1215 (1977), enf. denied on other grounds, 587 F.2d 449 (9th Cir.1979); see also Kraft Foods, Inc., 251 N.L.R.B. 598 (1980) (reinstatement should be ordered unless the employer establishes that the discharge was not based even in part on information obtained at the interview).

Courts proved reluctant to enforce orders of reinstatement, reasoning that Sec. 10(c) of the Act, 29 U.S.C. Sec. 160(c), which provides that the Board may not reinstate an employee "discharged for cause", barred reinstatement of employees who would not have been let go but for the misconduct revealed at the interviews. E.g., Pacific Telephone & Telegraph Co. v. NLRB, 711 F.2d 134, 137-38 (9th Cir.1983); Montgomery Ward & Co. v. NLRB, 664 F.2d 1095, 1097 (8th Cir.1981). Cf. NLRB v. Southwestern Bell Telephone Co., 730 F.2d 166, 174 (5th Cir.1984); NLRB v. Kahn's & Co., 694 F.2d 1070, 1071-72 (6th Cir.1982). In December 1984 the Board changed course, announcing in Taracorp Industries, 273 N.L.R.B. No. 54 (1984), that it would no longer order reinstatement and back pay for violations of the principle announced in Weingarten. It gave two reasons: first, that reinstatement would be inconsistent with Sec. 10(c); second, that reinstatement would be bad policy because the prospect of reinstatement had made the investigatory and remedial process in Weingarten cases too adversarial and complex. The Board therefore overruled Kraft Foods and, among other cases, Illinois Bell Telephone Co., 251 N.L.R.B. 932 (1980). See 273 N.L.R.B. No. 54 at 4 n. 6.

Overruling Illinois Bell was not as easy as all that. The employer had sought judicial review, and this court held that Illinois Bell had violated Weingarten when interviewing Cary Ann Hatfield, a telephone operator in Valdalia, Illinois. NLRB v. Illinois Bell Telephone Co., 674 F.2d 618 (7th Cir.1982). Illinois Bell suspected Hatfield of making long distance calls for herself and some prisoners at a nearby state prison without paying the company or billing the prisoners accurately. An investigator of Illinois Bell interviewed Hatfield at a time when no union representative could be found, and Hatfield, who confessed, was fired. We enforced the Board's order to the extent it found a violation of Sec. 7 but remanded the case "for such further proceedings as may be required to determine whether independent evidence sufficiently supported the Company's discharge of Hatfield for cause." 674 F.2d at 623. In other words, we sent the case back to the Board with instructions to apply the Kraft Foods doctrine. Before the Board could do this, it overruled both Kraft Foods and the decision we had remanded.

The administrative law judge concluded in December 1983 that Illinois Bell could not carry its burden under Kraft Foods. The Board decided the case in April 1985. Citing Taracorp, it held that Illinois Bell needed to prove nothing at all. It revoked the portions of its 1980 decision that had ordered Illinois Bell to reinstate Hatfield. 275 N.L.R.B. No. 27 (1985). The new decision orders Illinois Bell to cease and desist from violating the Weingarten rule and to post appropriate notices, but it orders no relief for Hatfield personally. Chairman Dotson and Member Hunter joined this decision. Member Dennis dissented, arguing that the terms of our remand in 1982 required the Board to apply the Kraft Foods doctrine notwithstanding the Board's abrogation of that doctrine in 1984.

Hatfield's union now requests us to order the Board to revive its original decision, under which Hatfield would be reinstated with back pay. The Union maintains that our mandate in 1982 requires no less. If the Board was free to decide the case anew, the Union insists, it still must reinstate Hatfield because Taracorp misunderstood the meaning of Sec. 10(c) of the Act. We have misgivings about the construction of Sec. 10(c) in Taracorp, but we conclude that the Board was entitled to adopt the Taracorp doctrine as an exercise of its discretion over remedies for violations of the Act. Because the Board is entitled to rethink old rules--even after a remand from the court--we enforce its order.

I

If we had held in 1982 that Kraft Foods stated an approach to remedies that the Board was legally required to pursue, then the Board would have been required to apply Kraft Foods here; it could not have changed its mind consistent with the Act. Butler Lime & Cement Co. v. OSHRC, 658 F.2d 544, 549 (7th Cir.1981); Chicago & Northwestern Transportation Co. v. United States, 574 F.2d 926, 930 (7th Cir.1978). We came to no such conclusion, however. Our opinion expressed doubt about the propriety of reinstating Hatfield. 674 F.2d at 623. We did not direct the Board to use the Kraft Foods test because it was the only permissible test; it was simply the one the Board favored at the time.

The Board is free to change course, provided the new course is within its legal power. See American Trucking Ass'ns, Inc. v. Atchison, Topeka & Santa Fe Ry., 387 U.S. 397, 416, 87 S.Ct. 1608, 1618, 18 L.Ed.2d 847 (1967). Weingarten itself was a dramatic change of policy by the Board. For decades the Board had declined to require employers to admit union representatives to disciplinary interviews. See 420 U.S. at 264, 95 S.Ct. at 967. The Court concluded that the new policy was permissible. Id. at 265-67, 95 S.Ct. at 967-68. So there is nothing wrong with new policy. And any change of policy will be reviewed sooner or later, as the Union has asked for review in this case. The question is whether the Board must ask the court's permission before applying the new policy to a case pending on remand from the court.

If the Board had asked us in 1984 for permission to apply the Taracorp policy to this case, we would have had three options: to forbid use of the policy on the ground of law of the case; to review the legal basis of the Taracorp policy on the spot and permit its application only if it was consistent with the Act; and to permit the Board to apply its current policy subject to later review at the behest of any aggrieved party. The first option would have been unthinkable, because our decision in 1982 did not resolve any dispute between the parties about the legal basis of the Kraft Foods policy. The doctrine of law of the case does not prevent an agency from reexamining a policy that was not squarely presented for resolution; indeed, even if this court had sustained the Kraft Foods policy against legal challenge, this would not have prevented the Board from singing a different tune. See FCC v. Pottsville Broadcasting Co., 309 U.S. 134, 144-46, 60 S.Ct. 437, 442-43, 84 L.Ed. 656 (1940). Judicial review of the Board's orders permits correction of legal mistakes, and once any mistake has been exposed further proceedings are in the Board's charge. South Prairie Construction Co. v. Operating Engineers, 425 U.S. 800, 805-06, 96 S.Ct. 1842, 1844-45, 48 L.Ed.2d 382 (1976). Nothing we said in 1982 preempted the Board's reconsideration.

The second option is immediate consideration of the new policy's legal status. Yet examination of the legal basis of Taracorp would have been premature. A court could not tell when the Board asks for leave to apply a new policy whether the difference between old and new policies would change the outcome. If the two policies produce the same result, a discourse on the legality of the new policy would be wasted effort in the service of an advisory opinion. That leaves the third option, to grant leave as of course and to review the new policy, once the Board has entered a final order, if it spells the difference in outcome. See E.I. DuPont de Nemours & Co. v. NLRB, 733 F.2d 296, 297-98 (3d Cir.1984); see also Woodkraft Division, Georgia Kraft Co. v. NLRB, 466 U.S. 901, 104 S.Ct. 1673, 80 L.Ed.2d 149 (1984) (vacating 696 F.2d 931 (11th Cir.1983), and remanding to allow the Board to reconsider a "final" decision, which the Board would not have seen otherwise).

If a request by the Board for leave to apply a new policy on remand would be granted automatically, then there is no point in requiring the Board to seek leave. Gone are the days when courts required useless requests. For example, it used to be necessary to obtain an appellate court's permission before asking the district court to set aside a judgment for fraud, if the judgment had been affirmed. It was thought that the district court could not undo the appellate mandate, even on account of circumstances the appellate court had not known. Such leaves either would be granted automatically or would require the appellate court to hold a hearing, a task for which it is unsuited. Today a district court may inquire into fraud without the leave of the appellate court. Standard Oil Co. of California v. United States, 429 U.S. 17, 97 S.Ct....