Hicks v. N.L.R.B., AFL-CI
| Decision Date | 26 May 1992 |
| Docket Number | AFL-CI,I,No. 91-1260,91-1260 |
| Citation | 964 F.2d 11 |
| Parties | 140 L.R.R.M. (BNA) 2384, 296 U.S.App.D.C. 11, 60 USLW 2795, 121 Lab.Cas. P 10,193 Florence H. HICKS, d/b/a Ebon Research Systems, Petitioner, v. NATIONAL LABOR RELATIONS BOARD, Respondent, American Federation of Government Employees, Local 3450,ntervenor. |
| Court | U.S. Court of Appeals — District of Columbia Circuit |
Jeffrey J. Pargament, Washington, D.C., with whom Angela D. Afflick was on the brief, for petitioner.
William M. Bernstein, N.L.R.B., with whom Jerry M. Hunter, General Counsel, and Aileen A. Armstrong, Deputy Associate General Counsel, Washington, D.C., were on the brief, for respondent. Charles P. Donnelly, N.L.R.B., Washington, D.C., also entered an appearance for respondent.
Anne M. Wagner, New York City, for intervenor. Mark D. Roth and Kevin M. Grile, Chicago, Ill., were on the brief, for intervenor.
Before RUTH BADER GINSBURG, BUCKLEY, and D.H. GINSBURG, Circuit Judges.
Opinion for the Court filed by Circuit Judge D.H. GINSBURG.
Pursuant to a contract with the National Institute of Occupational Safety and Health (NIOSH), an agency of the United States Government, petitioner Ebon Research Systems provided the animal care and support services staffs for a research facility located in Morgantown, West Virginia. When the Ebon employees at the NIOSH facility attempted to form a union, Ebon successfully resisted but the NLRB determined that in so doing the company committed various unfair labor practices.
In the proceedings before the NLRB, Ebon maintained that because the wages and benefits it provided its employees were essentially fixed by its contracts with the NIOSH, it could not engage in meaningful collective bargaining. Ebon argued that therefore under established policy the Board could not properly assert jurisdiction over it.
In Hicks v. NLRB (Hicks I), 880 F.2d 1396, 1397 (D.C.Cir.1989), we concluded that "the Board ha[d] offered no intelligible way of reconciling [its jurisdictional] decision with the rule" reflected in Res-Care, Inc., 280 N.L.R.B. 670 (1986), and Long Stretch Youth Home, Inc., 280 N.L.R.B. 678 (1986). We therefore remanded the case to the Board for "further action either consistent with its existing precedents or for generation of a new jurisdictional rule." 880 F.2d at 1400.
On remand, the Board issued a Supplemental Decision and Order in which it found that, with respect to wages, Ebon's contract with the NIOSH created only "potential" controls that the agency never actually exerted. With respect to fringe benefits and the non-economic aspects of its labor relations, the Board found that Ebon had substantial discretion. Upon these two bases, the Board reaffirmed its assertion of jurisdiction over Ebon. Ebon Research Systems, Inc., 302 N.L.R.B. No. 116 (1991).
Ebon has again petitioned for review, claiming that the Board abused its discretion in asserting jurisdiction over it, and the Board has cross-petitioned for enforcement of its order. We now uphold the Board, in light of the flexibility that Ebon retained to adjust employee benefits and the significant control that Ebon exercised over the non-economic aspects of the employment relationship. We further conclude that substantial evidence supports the Board's finding that Ebon discharged an employee for engaging in protected union activity, in violation of § 8(a)(3) of the National Labor Relations Act. 29 U.S.C. § 158(a)(3).
Ebon is an "employer" within the definition given that term in the NLRA. The United States, however, is specifically exempted from that definition, as are various other public sector entities. See 29 U.S.C. § 152(2). Where an employer provides services to such an exempt entity, it is the Board's policy under Res-Care not to assert jurisdiction over the employer if it is "[in]capable of engaging in meaningful collective bargaining" by virtue of "the scope and degree of control exercised by the exempt entity over [its] labor relations." Res-Care, 280 N.L.R.B. at 673.
In Res-Care the Board declined to assert jurisdiction over an employer that ran a Job Corps center pursuant to a contract with the Department of Labor. The DOL required the employer to submit for its approval a schedule of wage ranges for each job classification. In addition, the "DOL ask[ed] the employer to submit [for approval] its personnel policies concerning compensatory time, overtime, severance pay, holidays, vacation, probationary employment, sick leave, cost-of-living increases, incentives, and equal employment opportunity." Id. at 675. The employer could not change the wage schedule or any personnel policy without the DOL's further approval. Moreover, the contract required the employer to submit monthly vouchers to the DOL in order to be reimbursed its labor costs, and the DOL could refuse to reimburse any labor costs incurred without its prior approval. Id. In those circumstances, the Board had no difficulty concluding that the employer was not able to engage in meaningful collective bargaining.
In its Supplemental Decision in this case, the Board found that the fringe benefit provisions of Ebon's contracts were significantly more flexible than those in the Res-Care contract. With respect to the non-economic conditions of employment, the Board concluded that Ebon "retained and exercised far greater control than the ... contractor in Res-Care." Ebon, 302 N.L.R.B. No. 116, slip op. at 12. The Board then pointed out that it had determined in Community Transit Services, Inc., 290 N.L.R.B. 1167 (1988), that jurisdiction may properly be asserted upon these grounds alone. Ebon, 302 N.L.R.B. No. 116, slip op. at 12 n. 14.
Turning to Ebon's control over wages, the Board found that the wage provisions of Ebon's contracts with the NIOSH created only "potential" control that the agency never actually exerted. In light of Ebon's flexibility in setting fringe benefits and determining the non-economic conditions of employment, it concluded that the NIOSH did not in practice exercise "such a high degree of control" over wages as to preclude Ebon from engaging in meaningful collective bargaining. Id. at 12.
In addition, the Board determined that the NIOSH was quite "pliable" in approving increased labor costs. Moreover, even if the NIOSH were uncharacteristically to reject a collectively bargained mid-term increase in its labor costs, the Board reasoned that the Service Contract Act, 41 U.S.C. 351 et seq., would require the NIOSH to recognize that labor cost increase in its "next service contract" with Ebon, and that in any event Ebon "could bargain for language in a collective-bargaining agreement to protect it from the consequences" if the NIOSH were to refuse to reimburse it for such an increase. Ebon, 302 N.L.R.B. No. 116, slip op. at 13-14.
Ebon argues that the Board's Supplemental Decision asserting jurisdiction over it is inconsistent with the Board's prior decision in Res-Care and that it constitutes impermissibly "retroactive decisionmaking." We approach the jurisdictional aspect of this case mindful of the following precepts:
[We] will not disturb the Board's discretionary decision to assert its jurisdiction absent a showing that the Board acted unfairly and caused substantial prejudice to the affected employer. The Board nevertheless is bound by its own rules until it changes them, including the rules that it has adopted in order to channel what would otherwise be an essentially unreviewable discretion in the deployment of its prosecutorial resources.
Human Development Assoc. v. NLRB (HDA), 937 F.2d 657, 661 (D.C.Cir.1991) (citations omitted).
The parties have focused their attention upon Ebon's series of cost-plus-fixed-fee contracts for animal care services, and therefore so shall we. First, Ebon insists that under the terms of those contracts it did not retain sufficient flexibility, especially regarding wages, to engage in meaningful bargaining. In this connection Ebon asserts that of the three elements in an employment relationship--(1) wages, (2) benefits, and (3) non-economic terms of employment--control over wages is the "most important factor in determining whether an employer can bargain meaningfully." Second, Ebon claims that the Board's focus upon Ebon's flexibility with respect to benefits and the non-economic terms of employment was neither consistent with Res-Care nor, in any event, supported by substantial evidence.
Wages. Ebon asserts that the wage provisions of its contracts were more restrictive than those of the contract in Res-Care because Ebon's contracts specified "precise compensation rates" whereas the Res-Care contract merely "set wage ranges." We agree that with respect to wages Ebon had if anything less flexibility than did the employer in Res-Care. Indeed, if control over wages were a necessary condition, we would doubt that Ebon was in a position to bargain meaningfully.
We disagree, however, with Ebon's premise that the Res-Care doctrine elevates control over wages to a paramount position in the analysis of whether an employer can engage in meaningful collective bargaining. In HDA we described Board practice, of which we approved, as follows: "Rather than applying any single-factor test, the Board determines whether ... an exempt entity controls the economic terms and conditions of the labor relationship so as to preclude meaningful collective bargaining." 937 F.2d at 662. We also noted that at least since Community Transit, 290 N.L.R.B. 1167, an "employer's lesser authority over the economic terms and conditions of employment [may be] offset by its extensive control over non-economic terms." HDA, 937 F.2d at 663. Thus, even if the Board in Res-Care itself made control over wages a fundamental condition of meaningful collective bargaining, that approach has been superseded by...
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