Delta Sandblasting Co. v. Nat'l Labor Relations Bd.
| Decision Date | 11 August 2020 |
| Docket Number | No. 18-73097, No. 18-73305,18-73097 |
| Citation | 969 F.3d 957 |
| Parties | DELTA SANDBLASTING COMPANY, INC., Petitioner, v. NATIONAL LABOR RELATIONS BOARD, Respondent, District Council 16 of the International Union of Painters and Allied Trades, Respondent-Intervenor. National Labor Relations Board, Petitioner, International Union of Painters and Allied Trades, District Council 16, Petitioner-Intervenor, v. Delta Sandblasting Company, Inc., Respondent. |
| Court | U.S. Court of Appeals — Ninth Circuit |
Petitioner Delta Sandblasting Company, Inc. (Delta) appeals the National Labor Relations Board's (the Board) order ruling that it committed an unfair labor practice when, in March 2016, it decreased its employees’ hourly pension contribution rate to the Pacific Coast Shipyards Pension Fund (the Pension Fund) without first notifying or bargaining with their union (the Union).1 Specifically, Delta argues that the Board erred in ruling that Section 302(c)(5)(B) (Section 302) of the Labor Management Relations Act (LMRA), 29 U.S.C. § 186(c)(5)(B), did not prohibit Delta from making pension contributions to the Pension Fund according to the rates contained within a schedule (Schedule A) that the Board found was incorporated into the collective bargaining agreement (CBA) between Delta and the Union.2
We deny Delta's petition for review and grant the Board's cross-application for enforcement of its order. The Board properly ruled that Section 302's requirement of a "written agreement" defining pension contributions was satisfied here, and that Delta's failure to notify or bargain with its union over the pension contribution rate decrease was an unfair labor practice under Sections 8(a)(1) and 8(a)(5) of the National Labor Relations Act (NLRA), 29 U.S.C. §§ 158(a)(1), (5).
Delta is a Petaluma, California-based subcontractor that provides marine vessel painting and sandblasting services. During the period under review, Delta was owned and operated by James "Bobby" Sanders, Sr. (Sanders), who negotiated pension issues directly with the Union. José Santana oversees the Union, has been responsible for negotiating with Delta since 2008, and is a trustee of the Pension Fund. The Union and Sanders negotiated in an informal manner, often following the terms of the collective bargaining agreement between the District Council and BAE (a larger company for which Delta acted as a subcontractor). Prior to 2014, Delta paid its employees more than BAE paid its employees, which obviated the need for annual renegotiations between Delta and the Union.
The dispute in this case arose in March 2016, when Delta, without prior notice to the Union, ceased paying pension contributions in accordance with Schedule A, and reduced its monthly contribution rate to $1.95 per hour. In a letter to the Pension Fund explaining its reduced payment, Delta stated, "[w]e do not have the money at this time to pay the mandatory (critical status) amount due."
The Board, the Union, and Delta (the Parties) agree that the CBA between Delta and the Union expired on August 31, 2015, and pursuant to well-established caselaw, continues to govern the relationship between Delta and the Union. See Litton Fin. Printing Div. v. NLRB , 501 U.S. 190, 198, 111 S.Ct. 2215, 115 L.Ed.2d 177 (1991). In addition, the Parties agree that the CBA's Article 18.13 obligates Delta to make pension contributions to the Pension Fund, and that, between December 2014 and through the expiration of the CBA, Delta made those contributions in accordance with the rates contained in Schedule A. Relatedly, the Parties agree that, before 2009, Delta made pension contributions at a rate of $1.95 per hour, pursuant to a wage schedule contained within a previous version of the CBA (the 2008 Schedule A). Finally, the Parties agree that the Pension Fund declared itself in critical status pursuant to the Pension Protection Act of 2006 (PPA), 29 U.S.C. § 1085, and that a rehabilitation plan (the Rehabilitation Plan) for the Pension Fund, with annually updated pension contribution rate schedules, has been in effect since 2008.4
On appeal, Delta argues that the Board erred in rejecting its argument that Section 302, which requires that pension contributions be made pursuant to a "written agreement," prohibited it from paying pension contributions according to Schedule A, and that Delta is only obligated by written agreement to pay the 2008 pension contribution rate of $1.95 per hour. The Board and the Union, in contrast, argue that the CBA, which they contend incorporated Schedule A in 2014, satisfies Section 302's "written agreement" requirement.
In response to the change in Delta's pension contribution rate, the District Council filed a charge against Delta with the NLRB on May 16, 2016, and the NLRB's General Counsel filed a complaint soon after.5 On September 15, 2017, the Administrative Law Judge (ALJ) concluded that Delta's unilateral pension rate reduction, made without giving the Union notice or an opportunity to bargain, constituted an unfair labor practice pursuant to Sections 8(a)(1) and (5) of the NLRA.
The ALJ did not rule whether Delta's pension contributions before March 2016 violated Section 302's "written agreement" requirement. Instead, relying upon the Board's ruling in Quality House of Graphics, Inc. , 336 N.L.R.B. 497, 498–99 (2001), the ALJ held that, irrespective of the legality of the pension contribution rates pursuant to Section 302, Delta's failure to notify and bargain with the Union before decreasing its contribution rates was an unfair labor practice. The ALJ ordered Delta to make "all such delinquent contributions" that had not been made to the Pension Fund since April 2016 and to continue making them until it bargained with the Union in good faith to a contrary agreement or a bona fide impasse. The ALJ allowed Delta to "prove at compliance that resuming its surcharge contributions would violate Section 302."
The Union and Delta each filed exceptions to the ALJ's ruling.6 On October 16, 2018, a three-member panel of the Board (Chairman Ring, and Members McFerran and Kaplan) adopted the ALJ's "rulings, findings, and conclusions as modified [in the Board's decision and order]," and agreed with the ALJ's conclusion that Delta's unilateral pension contribution rate reduction was an unfair labor practice. In contrast to the ALJ, the Board considered and rejected Delta's defense that payment of pension contributions according to Schedule A was unlawful pursuant to Section 302.7 The Board found that Schedule A was incorporated into the CBA. Finally, the Board found that, at the time of its expiration, the CBA obligated Delta to make pension contributions at a rate of $9.78 per hour, and left undecided whether Delta was required to pay rates higher than that after the expiration of the CBA.
Delta timely petitioned for review of the Board's order pursuant to Section 10(f) of the NLRA.8 The NLRB General Counsel filed an application for enforcement of the Board's order on December 7, 2018. On December 31, 2018, the District Council intervened in support of the General Counsel. Delta's petition and the NLRB General Counsel's application were consolidated on January 10, 2019.
The Board had jurisdiction over the underlying unfair labor practice proceeding pursuant to 29 U.S.C. § 160(a). We have jurisdiction over Delta's petition for review and the Board's cross-application for enforcement, both timely, pursuant to 29 U.S.C. § 160(e) and (f).
The Board rejected Delta's Section 302 defense, concluding that the CBA, which it found incorporated Schedule A, met Section 302's "written agreement" requirement. On appeal, Delta argues that the Board's finding that the CBA incorporated Schedule A was not based upon substantial evidence. Instead, Delta argues, the 2008 Schedule A, which provides a rate of $1.95 per hour, was the last-agreed pension contribution schedule. Moreover, Delta argues that, even if we were to consider Schedule A as part of the CBA, it does not satisfy Section 302.
Below, we analyze the Board's factual finding that Schedule A was incorporated into the CBA using the substantial evidence standard of review. We then review de novo the Board's legal conclusion that the CBA, incorporating Schedule A, satisfied Section 302.
The NLRA authorizes the Board to make findings of fact and conclusions from the record, 29 U.S.C. § 160(c), and to review the ALJ's findings of fact de novo, see Penasquitos Vill., Inc. v. NLRB , 565 F.2d 1074, 1076 (9th Cir. 1977) (citing Universal Camera Corp. v. NLRB , 340 U.S. 474, 496, 71 S.Ct. 456, 95 L.Ed. 456 (1951) ). While the Board is empowered to review an ALJ's credibility findings de novo, according to Board policy it avoids doing so unless the "clear preponderance of all the relevant evidence" convinces the Board the findings are incorrect. Anja Eng'g Corp. v. NLRB , 685 F.2d 292, 295 n.8 (9th Cir. 1982) (emphasis added) (citing Standard Dry Wall Prods. , 91 N.L.R.B. 544, 544–45 (1950), enforced , 188 F.2d 362 (3d Cir. 1951) ), overruled on other grounds by Raley's, Inc. v. NLRB , 725 F.2d 1204, 1206 (9th Cir. 1984).
In contrast, we uphold the Board's factual findings if they are supported by substantial evidence. Glendale Assocs., Ltd. v. NLRB , 347 F.3d 1145, 1151 (9th Cir. 2003). " ‘Substantial evidence’ is ‘more than a mere scintilla, but less than a preponderance.’ " NLRB v. Int'l Bhd. of Elec. Workers, Local 48 , 345 F.3d 1049, 1053–54 (9th Cir. 2003) (quoting Mayes v. Massanari , 276 F.3d 453, 459 (9th Cir. 2001) ). Concerning factual findings, "[a] reviewing court may not displace the NLRB's choice between two fairly conflicting views, even though the court would justifiably have made a different...
To continue reading
Request your trial
-
Bd. of Trs. of Auto. Machinists Pension Tr. v. Peninsula Truck Lines Inc., C21-64 MJP
...Tr. Fund v F.W. Honerkamp Co. Inc., 692 F.3d 127, 132 (2d Cir. 2012)); see also Delta Sandblasting Co., Inc. v. Nat'l Labor Relations Bd., 969 F.3d 957, 968 (9th Cir. 2020) (upholding an order compelling an employer to bargain over a rehabilitation plan rate). As a result, Peninsula's oblig......