Int'l Alliance of Theatrical Stage Emps. v. Nat'l Labor Relations Bd.

• Decision Date: 29 April 2020
• Docket Number: No. 19-70651,19-70651
• Citation: 957 F.3d 1006
• Parties: INTERNATIONAL ALLIANCE OF THEATRICAL STAGE EMPLOYEES, LOCAL 15, Petitioner, v. NATIONAL LABOR RELATIONS BOARD, Respondent.
• Court: U.S. Court of Appeals — Ninth Circuit

957 F.3d 1006

INTERNATIONAL ALLIANCE OF THEATRICAL STAGE EMPLOYEES, LOCAL 15, Petitioner,

v.NATIONAL LABOR RELATIONS BOARD, Respondent.

No. 19-70651

United States Court of Appeals, Ninth Circuit.

Argued and Submitted March 4, 2020 Seattle, Washington

Filed April 29, 2020

Dmitri Iglitzin (argued), Laura Ewan, and Kelly Skahan, Barnard Iglitzin & Lavitt LLP, Seattle, Washington, for Petitioner.

Kellie Isbell (argued) and Gregoire Sauter, Attorneys; Usha Dheenan, Supervisory Attorney; David Habenstreit, Acting Deputy Associate General Counsel; Alice B. Stock, Associate General Counsel; Peter B. Robb, General Counsel; National Labor Relations Board, Washington, D.C.; for Respondent.

On Petition for Review of an Order of the National Labor Relations Board, NLRB Nos. 19-CA-186007, 19-CA-192068

Before: Sandra S. Ikuta, Ryan D. Nelson, and Danielle J. Hunsaker, Circuit Judges.

HUNSAKER, Circuit Judge:

At issue in this collective bargaining case is whether the employer, Audio Visual Services Group d/b/a PSAV Presentation Services ("PSAV"), effectively retracted its claim of inability to pay the union’s wage and benefits proposals, thereby limiting its obligation to produce financial documents to the union, and whether PSAV failed to bargain in good faith. Petitioner International Alliance of Theatrical Stage Employees, Local 15 ("Local 15" or "Union") is the certified collective-bargaining representative for PSAV’s employees. The National Labor Relations Board ("NLRB") found that PSAV did retract its inability-to-pay claim and that PSAV’s conduct both at and away from the bargaining table did not establish that it acted in bad faith in violation of the National Labor Relations Act ("Act"), 29 U.S.C. §§ 151 – 169. Rather, the NLRB concluded that Local 15 "did not sufficiently test [PSAV]’s willingness to bargain prior to filing its bad-faith bargaining charge." Audio Visual Servs. Grp., Inc. , 367 N.L.R.B. No. 103, 2019 WL 1198973, at *10 (Mar. 12, 2019). We hold that substantial evidence supports the NLRB’s findings, and we affirm.

I. BACKGROUND

PSAV provides event technology services to hotels and conference centers nationwide, and it maintains offices in Washington state and Pennsylvania. In December 2015, Local 15 was certified as the exclusive collective-bargaining representative for the riggers and technicians¹ in Washington who provide audio visual support services for PSAV. PSAV challenged the union’s certification and refused to bargain with Local 15 from January 2016 until the NLRB denied PSAV’s request for review in May 2016.² Audio Visual Servs. Grp., Inc. , 365 N.L.R.B. No. 84, 2017 WL 2241025, at *3 (May 19, 2017). A few days after its request for review failed, PSAV acknowledged Local 15 as the collective-bargaining representative and promptly responded to Local 15’s request to begin negotiations.³ From mid-2016 through early 2017, PSAV and Local 15 engaged in the bargaining process and held multiple in-person bargaining sessions, but they did not reach agreement.

The parties’ first in-person bargaining session was in June 2016, and the parties primarily focused on establishing ground rules for their bargaining process. The following month, Local 15 presented its first contract proposal, which sought wages of $33 to $45 per hour, representing a 73- to 120-percent increase depending on job classification. Local 15 also sought, among other things, overtime pay in circumstances where it is not legally required, contributions to Local 15’s pension and health plans, limits on PSAV’s ability to subcontract work, progressive discipline measures and "just cause" limits on termination and discipline, and an arbitration provision. A few weeks later, PSAV presented a counter-proposal to pay wage rates from $15 to $30 per hour depending on job classification. PSAV also proposed, among other things, that current employees would "maintain their current rate of pay and not be subject to a reduction in pay as a result of this Agreement," overtime would be paid as required by law, the same benefits provided to unrepresented employees would be provided to the employees represented by Local 15, discipline would be based on a "reasonable belief" standard, and arbitration proceedings would be final.

The parties held their second bargaining session a week later, on August 17–18, 2016.⁴ Local 15 relayed the employees’ disappointment with PSAV’s wage proposal. PSAV’s attorney, David Shankman, responded that Local 15 was "delusional" and misleading employees and that agreeing to the Union’s proposed wage increase would be "suicide" for PSAV and put it "underwater." Audio Visual Servs. Grp. , Inc., 2019 WL 1198973, at *2. Shankman asserted that PSAV pays 50-percent commissions to Seattle-area hotels and convention centers, its contracts with those properties are nonexclusive and precarious, and the Seattle market would not support event rates necessary to cover the union’s proposed wage rates. Local 15 explained that its wage proposal was partially based on PSAV’s union contracts in California markets, but PSAV disputed the relevance of those contracts because they relate to "as-needed" employees who have "no expectation of regular hours" unlike PSAV’s in-house Washington technicians who "work regardless of specific shows or events and often work when no billable opportunity is presented." During this second bargaining session, Local 15 reduced its requested wage rates by $2 per hour (still a 64- to 106-percent increase) and adjusted its overtime and discipline proposals. The parties did not reach agreement on these issues but reached tentative agreements on other contract terms.

After the second bargaining session, Local 15 requested financial information supporting PSAV’s assertion that the Union’s wage proposal would put PSAV "underwater" and would be "suicide" for the company. Specifically, Local 15 requested:

[1] Documents sufficient to substantiate PSAV’s claim of its inability to pay the requested wages; particularly, we request that the company provide documents that demonstrate the company’s gross revenues, expenses, and profits for 2015 and 2016 to date;

[2] PSAV’s current contracts with any and all of its hotel clients in Seattle, SeaTac, Bellevue, Tukwila, and Tacoma;

[3] If the contracts requested in above don’t expressly establish the commission rates and sums PSAV has paid to such property owners between January 1, 2015 and the present, documents that demonstrate that information;

and,

[4] Documents sufficient to show the rates charged to all event clients to whom PSAV has provided service in the cities listed above within the past year (September 1, 2015 to present).

Id. at *3. Shankman rebuffed these requests, stating "[t]his is not an inability to pay for lack of revenue. It’s a refusal to pay an hourly rate that would be detrimental to the business." He further explained that "no employer in this business would pay such a wage to its hourly workforce that was so grossly outside of its business model and if it did so, it would be suicide for the company." Local 15 did not respond to PSAV’s clarification that it was unwilling , rather than unable , to pay the Union’s requested wages.

In mid-September, the parties exchanged additional counterproposals in anticipation of their third in-person bargaining session on September 19, 2016, but neither party changed their position on wages, benefits, or discipline. During their third bargaining session the parties reached tentative agreements on several terms but not on any of their key points of disagreement.

Less than one month later, in early October 2016, Local 15 filed an NLRB charge against PSAV, asserting: "Within the past six (6) months [PSAV] has violated the [the Act] by failing and refusing to provide information to IATSE Local 15 that is relevant to its role and duties as employees’ collective bargaining representative." Two days later, Shankman sent a letter to Local 15 and the entire bargaining unit defending PSAV’s wage proposal and explaining that the Union’s wage proposal was based on contracts from California markets where union employees are hired as-needed with no expectation of regular hours. Shankman’s letter stated: "We heard your proposal for a nearly 100% pay increase for some positions. We just don’t agree with it, and we don’t accept it."

The parties cancelled bargaining sessions planned for November and December but continued to exchange contract proposals. In late January 2017, Local 15 emailed PSAV a partial contract proposal with modified discipline, grievance, and arbitration provisions. Local 15 stated: "We look forward to the parties’ return [to] the table and hope that the time away brings a renewed sense of purpose to the parties’ talks and an eye towards real progress." The parties held their fourth in-person bargaining session on January 26, 2017, and reached tentative agreements on some additional terms. The next day, however, Local 15 filed another NLRB charge alleging that PSAV was bargaining in bad faith. After filing this charge, Local 15 cancelled the parties’ bargaining session scheduled in March 2017 and declined PSAV’s requests to continue negotiations.

After Local 15 filed its second NLRB charge, PSAV’s CEO, Mike McIlwain, attended a meeting of the company’s Philadelphia employees the day before the employees were scheduled to vote on unionization and stated that negotiations in Seattle were at a stalemate and the same impasse could happen in Philadelphia. A slide from McIlwain’s presentation also asserted: "Collective bargaining does not always result in agreement .... PSAV will not enter into an agreement that would negatively impact our business model." He also stated that, while PSAV had to bargain in good faith, it was not obligated to agree on any specific terms.

The NLRB General Counsel issued a complaint against PSAV in May 2017 based on Local 15’s October 2016 and January 2017 charges. After briefing and a two-day hearing, the ALJ...