Hicks v. N.L.R.B., AFL-CI
| Decision Date | 28 July 1989 |
| Docket Number | AFL-CI,No. 88-1625,I,88-1625 |
| Citation | 880 F.2d 1396 |
| Parties | 131 L.R.R.M. (BNA) 3201, 279 U.S.App.D.C. 323, 112 Lab.Cas. P 11,380 Florence J. HICKS, d/b/a Ebon Research Systems, Petitioner, v. NATIONAL LABOR RELATIONS BOARD, Respondent, American Federation of Government Employees, Local 3430,ntervenor. |
| Court | U.S. Court of Appeals — District of Columbia Circuit |
Robert L. Ackerly, with whom Claude Roxborough was on the brief, for petitioner.
Scott D. Macdonald, Atty., N.L.R.B., with whom Peter Winkler, Supervisory Atty., Robert E. Allen, Gen. Counsel, and Aileen A. Armstrong, Deputy Associate Gen. Counsel, N.L.R.B., Washington, D.C., were on the brief, for respondents.
Mark D. Roth and Kevin M. Grile, Washington, D.C., were on the brief for intervenor.
Before ROBINSON, BUCKLEY and WILLIAMS, Circuit Judges.
Opinion for the Court filed by Circuit Judge WILLIAMS.
Dr. Florence J. Hicks, doing business as Ebon Research Systems, provides research services to government agencies, including the National Institute of Occupational Safety and Health. In the present case the work was performed at NIOSH's Morgantown, West Virginia facility, with Ebon acting as a subcontractor for the Small Business Administration; the work largely revolved around the management of animals used by NIOSH in its testing efforts. Some of Ebon's Morgantown employees started a unionization campaign, which they pursued with the aid of Local 3430 of the American Federation of Government Employees, an intervenor here. Dr. Hicks opposed the effort, taking steps that an administrative law judge at the National Labor Relations Board found to constitute unfair labor practices, after having concluded that the Board had jurisdiction. On appeal by Hicks, the Board remanded the case to the ALJ for reconsideration of the jurisdictional issue in the light of its intervening decisions in Res-Care, Inc., 280 NLRB 670 (1986), and Long Stretch Youth Home, Inc., 280 NLRB 678 (1986). The ALJ again found jurisdiction, and this time the Board affirmed, limiting its discussion of jurisdiction to a half-page footnote. Hicks v. AFGE Local 3430, 290 NLRB No. 84 (1988). Because the Board has offered no intelligible way of reconciling the present decision with the rule of those cases, we remand the case for reconsideration and a more adequate explanation. We do not rule on the unfair labor practice issues.
In National Transportation Service, 240 NLRB 565 (1979), the Board adopted a new test for jurisdiction: it would not exercise authority over an employer performing services for an exempt entity if the employer's arrangement with the exempt entity so limited the employer's control over its workers' employment conditions (especially wages) that it was unable to bargain collectively with a union representative. The apparent logic of the test, as it ultimately emerged in Res-Care and Long Stretch, was that if the employer, as to wages, acts as little more than a piece of carbon paper through which the exempt entity's wage decisions are transmitted to the employees, then any apparent collective bargaining by the employer would in substance be with the (supposedly) exempt entity.
The employer in Res-Care ran a job corps center under contract to the Department of Labor. Res-Care had a cost-plus-fixed-fee contract, which was derived from a line-item operating budget submitted by the company to the Department. Res-Care was also required to submit schedules setting out its job classifications and salary scales, including minimum and maximum wage rates for each job. Once the Department approved the wage ranges and the budget, the proposed numbers became the contract price; any alterations required Labor Department approval. The employer submitted monthly vouchers claiming reimbursement. If the vouchers reflected wages paid in excess of the maximum allowable rate, the Department was free to reject the excess and deduct it from the reimbursement sought. 280 NLRB at 671, 673. Thus if Res-Care skimped on one set of costs in order to raise wages, the Department of Labor could cut its reimbursement on the skimped areas but decline to raise the reimbursement for wages.
The Board ruled that Res-Care lacked the requisite autonomy: "In every sense, it is DOL, not Res-Care, which retains ultimate discretion for setting wage and benefits levels of the job corps center...." Id. (footnote omitted). In so finding, and despite more sweeping dicta earlier in the opinion, the NLRB noted that "without denigrating the importance of other personnel-related issues, we hold that if an employer does not have the final say on the entire package of employee compensations, i.e., wages and fringe benefits, meaningful bargaining is not possible." Id. at 674. The Board explicitly held that a key factor in the control determination was the "direct limits on employee compensation ... and not the fact that DOL places an effective ceiling on such expenditures by limiting Res-Care's total budget." Id. at 674 n. 22.
In Long Stretch, handed down on the same day as Res-Care, the Board identified at least some limits to Res-Care. Long Stretch provided residential care for children in Maryland under contract with the state. The state scheme required initial licensing by the state, "reevaluation" (evidently annual, see 280 NLRB at 681), and annual submission of a proposed operating budget. For initial licensing and reevaluation Long Stretch submitted proposed salary ranges and benefit levels. The state licensing agency reviewed those with a very light touch, apparently looking only for "grossly unfair" salaries, presumably suggestive of a Dickensian atmosphere. The agency also reviewed benefits, but only to be sure that certain types were supplied, regardless of level. Long Stretch submitted its budget separately, and the agency used it, together with those of the 49 other similar care providers, to propose a budget to the Maryland General Assembly. On the basis of the Assembly's funding, the agency would then select a per child sum for reimbursement. These payments supplied nearly all of Long Stretch's gross income. Id. at 678.
As the Board pointed out in its Long Stretch decision, the state's control over Long Stretch's wages and benefits was far looser and less direct than Labor's control over Res-Care's. Monitoring in the licensing and reevaluation process did not relate to amounts, except for some concern over extreme cases. Id. at 681. Long Stretch's budget submission related only indirectly to its actual reimbursement, as it eventuated, after consideration of 49 others' budgets,...
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