Emeryville Research Center, Shell Dev. Co. v. NLRB
| Decision Date | 14 April 1971 |
| Docket Number | No. 23833.,23833. |
| Citation | 441 F.2d 880 |
| Parties | EMERYVILLE RESEARCH CENTER, SHELL DEVELOPMENT COMPANY, a division of Shell Oil Co., Petitioner, v. NATIONAL LABOR RELATIONS BOARD, Respondent. |
| Court | U.S. Court of Appeals — Ninth Circuit |
David M. Heilbron (argued), William W. Schwarzer, of McCutchen, Doyle, Brown & Enersen, San Francisco, Cal., for petitioner.
Ian D. Lanoff (argued), Paul J. Spielberg, Attys., Marcel Mallet-Prevost, Asst. Gen., Counsel, Dominick L. Manoli, Associate Gen. Counsel, Arnold Ordman, Gen. Counsel, N. L. R. B., Washington, D. C., Roy O. Hoffman, Director, N. L. R. B., San Francisco, Cal., Norback & Law, San Mateo, Cal., for respondent.
Before JERTBERG, DUNIWAY and TRASK, Circuit Judges.
Emeryville Research Center (the Company) petitions to review and set aside an order of the National Labor Relations Board. The Board found that the Company's failure to furnish information requested by the Association of Industrial Scientists (the Union) was a "refusal to bargain collectively in good faith" in violation of section 8(a) (5) and (1) of the National Labor Relations Act, 29 U.S.C. § 158(a) (5) and (1). The Board cross-petitions for enforcement of its order. We set the Board's order aside.
The Board ordered the Company to cease and desist from refusing to bargain collectively by refusing to furnish the Union:
The items of information covered by the Board's order are components of the salary administration system which the company uses to determine individual salaries of some 430 professional scientists and engineers in the bargaining unit, who are employed to do scientific research at the Company's Emeryville, California center. According to the collective bargaining agreement, the Company retains the right unilaterally to determine individual merit salaries. The Company's salary system is rather sophisticated. Each employee is assigned a subjective merit rating by his supervisor and an experience credit based in part on his level of education and in part on his work experience in his field of specialization. The guide curves are derived from a salary survey of eleven competitive research companies. There are nine guide curves which define ten merit bands. Projection of the guide curves on paper, with experience credit on the horizontal axis and salary level on the vertical axis, shows the salary range for each employee. Although the Union has never bargained about individal salaries, it has a contractual right to assent to across-the-board general salary increases and has actively bargained for such increases. The bargaining history also reveals that the Company has supplied the Union with a substantial amount of salary data, some of it required by the agreement and some not.
The current dispute arose in contract negotiations in the Fall of 1966. The Union presented a proposal to modify the salary article of the collective bargaining agreement by requiring the Company each year to supply (1) a copy of the salary guide curves to be in effect for the ensuing year and (2) two lists, unidentified by name, showing individual salaries and merit ratings for all employees by experience credit groups as of January 1 and July 1. The second proposal differed from the existing salary article only in the inclusion of merit rating data and the provision for semi-annual lists.
The Union was unable to persuade the Company to accept its proposed modifications, and on January 30, 1967, the agreement was executed with the salary article unchanged. The same day the Union submitted a letter to the Company renewing and broadening its request for information. In addition to the information sought in the modification proposal, the Union requested a written explanation of the guide curves, the curves for the previous five years, and the inclusion of academic degrees in the salary and merit rating lists.
The Company replied on February 13. Enclosed with the letter was the current salary information then required by the agreement. With respect to the additional information requested, the Company expressed its concern over the amount of effort that would be required to compile it and the danger that some of the data requested might tend to reduce the anonymity of the data already being supplied. The Company nonetheless offered to meet with the Union to discuss the relevance of the requested data to the current negotiations.
A meeting was held for that purpose on February 21. Although the record is quite sketchy as to what happened at that meeting, it appears that the Company asked the Union to state specifically why it needed the requested information so that the parties could work together to put the information into a form which would meet the Union's needs and at the same time satisfy the Company's objections. The Union, apparently, did not explain its reasons beyond stating, in substance, that it needed the information in order to bargain intelligently. The meeting yielded no significant progress toward a settlement of the dispute.
One week later, on February 27, the Union presented the Company with a letter that amounted to a demand. The Union restated its insistence that the requested data was reasonably necessary for it to bargain intelligently and advised the Company that unless it produced the data within one week, or within that time set a future date for its production, the Union would proceed before the Board.
The Company replied by letter on March 7. First, the Company pointed out that the Union had already received one written and two oral explanations of the guide curves. Next, the Company explained in detail its objections to providing the remaining requested data. With respect to the merit ratings, the Company noted that supervisors were included in the merit rating system and that to divulge merit ratings for Union employees would necessarily also divulge supervisor merit ratings. Nevertheless, the Company offered to review the possibility of devising a rating system excluding supervisors so that merit rating data could be supplied to the Union without revealing supervisor ratings. With respect to the guide curves, the Company argued that their production would jeopardize the Company's entire salary system. The guide curves are derived from salary information obtained in confidence from eleven competitive research companies. The Company feared that if it could no longer assure the confidentiality of the salary survey data, the companies in the survey would cease to participate and the salary system would be destroyed. With respect to academic degrees the Company objected on two grounds. First, a considerable amount of clerical data would be required to compile it. Second, inclusion of academic degrees along with salaries and experience credit would make it easier to identify the salaries of individual employees and thus reduce the anonymity of the data already being supplied. Finally, the Company did not flatly refuse to furnish the information requested. It repeated its request that the Union specify its needs in the light of the objections raised so that information could be supplied to meet those needs on mutually satisfactory terms. The Union refused to state its needs in any greater detail as requested and filed an unfair labor charge with the Board.
A refusal to supply information relevant to the proper performance of a Union's collective bargaining role will support a Board finding of refusal to bargain in good faith under section 8(a) (5) of the Act. NLRB v. Acme Industrial Co., 1967, 385 U.S. 432, 435-436, 87 S.Ct. 565, 17 L.Ed.2d 495; NLRB v. Truitt Mfg. Co., 1956, 351 U.S. 149, 76 S.Ct. 753, 100 L.Ed. 1027. The first question in such a case is always one of relevance. If the information requested has no relevance to any legitimate union collective bargaining need, a refusal to furnish it could not be an unfair labor practice. In this case the Trial Examiner found, and the Board agreed, that each of the items subject to the Board's order satisfied the relevancy requirement. We assume, without deciding, that each of those findings is supported by substantial evidence on the record as a whole.
The Company argues, however, that even though the requested information be relevant, the Company's failure to furnish it, taking into account all of the circumstances in which it was demanded, is not a refusal to bargain in good faith. We find this argument persuasive. The factual circumstances which we deem important are set out below:
First: the Company stated specific objections to furnishing each of the items requested. There is no suggestion that its reasons were disingenuous or merely a cover-up to delay or frustrate the Union's request. The Trial Examiner credited the Company's fear that disclosure of the guide curves would jeopardize its entire salary system.1 The Trial Examiner also apparently agreed with the Company's objection to furnishing the Union with merit ratings because he ruled that the Union was not entitled to merit ratings for supervisory personnel. With respect to academic degree and type of work data, the Trial Examiner did not question the genuiness of the Company's concern for anonymity with respect to the salaries of its professional employees, but ruled only that the Company was not entitled to claim protection of Union members as a basis...
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