Kawasaki Motors Mfg. Corp., U.S.A. v. N.L.R.B.

• Decision Date: 22 June 1988
• Docket Number: Nos. 87-7122,87-7177,s. 87-7122
• Citation: 850 F.2d 524
• Parties: 128 L.R.R.M. (BNA) 2913, 109 Lab.Cas. P 10,583 KAWASAKI MOTORS MANUFACTURING CORPORATION, U.S.A., Petitioner, Cross- Respondent, v. NATIONAL LABOR RELATIONS BOARD, Respondent, Cross-Petitioner, International Union, United Automobile, Aerospace and Agriculture Implement Workers of America (UAW), Respondent-Intervenor.
• Court: U.S. Court of Appeals — Ninth Circuit

Page 524

850 F.2d 524

128 L.R.R.M. (BNA) 2913, 109 Lab.Cas. P 10,583

KAWASAKI MOTORS MANUFACTURING CORPORATION, U.S.A. Petitioner, Cross- Respondent, v. NATIONAL LABOR RELATIONS BOARD, Respondent, Cross-Petitioner International Union, United Automobile, Aerospace and Agriculture Implement Workers of America (UAW) Respondent-Intervenor.

Nos. 87-7122, 87-7177.

United States Court of Appeals Ninth Circuit.

Argued and Submitted April 5, 1988.

Decided June 22, 1988.

William B. Stewart, Washington, D.C., for petitioner, cross-respondent.

Charles Sykes, Houston, Tex., for respondent, cross-petitioner.

Stanley Eisenstein, Chicago, Ill., for respondent-intervenor.

On Petition for Review and Cross-Application for Enforcement of an Order of the National Labor Relations Board.

Before TANG, FLETCHER and PREGERSON, Circuit Judges.

PREGERSON, Circuit Judge:

The National Labor Relations Board (NLRB) ordered Kawasaki Motors Manufacturing Corporation, U.S.A. (Kawasaki) to compensate Daniel Bennett (Bennett) for earnings lost because Kawasaki unlawfully fired Bennett. The NLRB's order of November 17, 1986, as corrected by its order of February 3, 1987, specifies the amount of backpay Kawasaki owes Bennett. Kawasaki petitions this court to review and set aside the NLRB's order of November 17, 1986, alleging that the backpay award is not supported by substantial evidence and that the NLRB violated its own rules and regulations in determining the amount of the award. The NLRB asks this court to enforce the NLRB's order. We affirm the NLRB's findings and enforce its November 17, 1986 order, as that order is corrected by the February 3, 1987 order.

I BACKGROUND

On April 10, 1979, Kawasaki unlawfully fired Daniel Bennett in violation of section 8(a)(1), (3) of the National Labor Relations Act, 29 U.S.C. Sec. 158(a)(1), (3) (1982). Before his termination, Daniel Bennett's record of service to Kawasaki was described as "outstanding," "commendable," and "superior." Kawasaki acknowledged the quality of Bennett's work by giving him three raises during the year or so before it fired him.

Daniel Bennett was also a union supporter. When Bennett was fired, Kawasaki's Lincoln, Nebraska facility was in the middle of an increasingly heated union campaign. An election was imminent. Bennett actively promoted the International Union, United Automobile, Aerospace and Agricultural Implement Workers of America (UAW). He wore union T-shirts and buttons, talked to other employees about union representation, and served on the union's organizing committee.

One day close to the election--after working eight hours from 5:00 p.m. to approximately 1:00 a.m.--Bennett sat down to take a break. He found a Reader's The NLRB determined that Kawasaki's reason for firing Bennett was pretextual. While the ALJ found that perusing Reader's Digest on the job arguably could justify a "mild rebuke," he did not see how it could shake Kawasaki's confidence in Bennett. Termination seemed out of proportion to the transgression. The ALJ concluded that "Bennett was subjected to summary, harsh discipline because of a desire by [Kawasaki] to rid itself of [Bennett's] union activism shortly before the election." Kawasaki Motors Corporation, U.S.A., 257 N.L.R.B. 502, 516 (1981), enforced, 691 F.2d 507 (9th Cir.1982), cert. denied, 459 U.S. 1202, 103 S.Ct. 1186, 75 L.Ed.2d 433 (1983).

                Digest and opened it to the section entitled "Laughter--The Best Medicine."    Bennett's supervisor "caught" Bennett reading, and reprimanded him for resting on the job.  Kawasaki fired Bennett the next afternoon on the ground that Bennett's supervisor "could no longer trust him."
                

On August 3, 1981, the NLRB ordered Kawasaki to "make [Bennett] whole for lost earnings" resulting from his unlawful discharge. Id. at 520. We denied Kawasaki's petition for review and enforced the NLRB's order. Kawasaki Motors Corporation, U.S.A. v. NLRB, 691 F.2d 507 (9th Cir.1982), cert. denied, 459 U.S. 1202, 103 S.Ct. 1186, 75 L.Ed.2d 433 (1983).

The parties could not agree on the amount of backpay Kawasaki owed Bennett. Accordingly, the NLRB's Regional Director issued a backpay specification ¹ and a notice of hearing for a backpay proceeding pursuant to 29 C.F.R. Sec. 102.52 (1987). Kawasaki denied all pertinent allegations of the backpay specification and proposed its own backpay formula.

The initial backpay hearing was held on November 8-10, 1983. After the hearing, the General Counsel filed an amended backpay specification. The administrative law judge (ALJ) issued a supplemental decision on January 30, 1985. Kawasaki filed exceptions.

In January 1986, the NLRB remanded the case for the ALJ to take additional evidence on two issues: (1) the appropriate formula for computing overtime, and (2) whether Bennett would have received a promotion during the backpay period had he not been discriminatorily discharged for union activities, and, if so, the date of the promotion and the rate of pay he would have received.

Additional ALJ hearings were held in February and March 1986. The General Counsel moved to amend the backpay specification again to reflect its view that Bennett would have been promoted on August 1, 1979. The ALJ issued a second supplemental decision recommending that Bennett be awarded backpay from the date of his discharge to the date of Kawasaki's reinstatement offer. The ALJ found Bennett would have been promoted on August 1, 1979. He also made findings regarding the proper method of calculating overtime backpay.

On November 17, 1986, the NLRB issued a Supplemental Decision and Order substantially affirming the rulings, findings, and conclusions of the ALJ and adopting the ALJ's recommended order with minor modifications. On February 3, 1987, the NLRB clarified its order, indicating that interest would be added to net backpay and that Bennett remains entitled to a promotion. The NLRB stated that the amount of backpay will remain open until Bennett

is actually offered the promotion to which he is entitled.

II DISCUSSION

Kawasaki makes five specific complaints, which we will address in turn. It contends that the NLRB's backpay award should be reduced because: (1) Bennett's search for work was not adequately diligent during a twenty-one week period of unemployment; (2) Bennett incurred a willful loss of earnings by voluntarily terminating interim employment; (3) Bennett concealed interim earnings from the NLRB; (4) the NLRB violated its own rules and regulations by belatedly considering the issue of whether Bennett would have been promoted had Kawasaki not unlawfully terminated him; and (5) Bennett would not have been promoted on August 1, 1979, as the NLRB concluded.

Before addressing Kawasaki's contentions, we note that the NLRB's backpay orders are subject to only limited judicial review. The NLRB has broad discretionary authority to award backpay to remedy unfair labor practices. NLRB v. J. H. Rutter-Rex Mfg. Co., 396 U.S. 258, 262-63, 90 S.Ct. 417, 419-20, 24 L.Ed.2d 405 (1969). We give considerable deference to the NLRB's exercise of its discretion. Sure-Tan, Inc. v. NLRB, 467 U.S. 883, 898-99, 104 S.Ct. 2803, 2812, 81 L.Ed.2d 732 (1984); Alfred M. Lewis, Inc. v. NLRB, 681 F.2d 1154, 1156 (9th Cir.1982). Findings of fact in a backpay proceeding will be upheld as long as they are supported by substantial evidence, considering the record as a whole. NLRB v. United Bhd. of Carpenters & Joiners of America, Local 1913, 531 F.2d 424, 426 (9th Cir.1976).

In a backpay proceeding, the General Counsel's burden is to show only the gross amount of backpay due a claimant. See M Restaurants, Inc. v. NLRB, 621 F.2d 336, 337 (9th Cir.1980). Once that is done, the burden shifts to the employer to establish facts that would reduce that amount. Id. Thus, Kawasaki bore the burden of proving the factual issues warranting a reduction of the gross amount of backpay. This is a difficult burden because doubts must be resolved against the employer who committed the unfair labor practice. NLRB v. Madison Courier, Inc., 472 F.2d 1307, 1321 (D.C.Cir.1972); NLRB v. Miami Coca-Cola Bottling Co., 360 F.2d 569, 572-73 (5th Cir.1966). Cf. Alfred M. Lewis, Inc., 681 F.2d at 1157 ("the employer should not be allowed to benefit from the uncertainty caused by its discrimination").

1. Bennett's Search for Work

Kawasaki first argues that its liability for the gross amount of backpay should be reduced because Bennett's search for work was not sufficiently diligent during the twenty-one week period between July and December 1981. Kawasaki alleges that Bennett applied to only six employers during that period, and that newspaper advertisements and hiring records indicated that many jobs performable by Bennett were available.

A wrongfully discharged employee is required to make only a reasonable effort to obtain interim employment, and is not held to the highest standard of diligence. Iron Workers Local 118 v. NLRB, 804 F.2d 1100, 1102 (9th Cir.1986); NLRB v. Westin Hotel, 758 F.2d 1126, 1130 (6th Cir.1985). Success or failure in securing interim employment is not a measure of the sufficiency of the employee's search; the law requires only an "honest good faith effort." Canova v. NLRB, 708 F.2d 1498, 1506 (9th Cir.1983) (citations omitted). Because the ultimate test of the employee's efforts is whether they are consistent with the inclination to work and to be self-supporting, we approve the NLRB's policy of looking to the backpay period as a whole and not at isolated portions of that period. See, e.g., Sioux Falls Stock Yards Co., 236 N.L.R.B. 543, 551 (1978); Saginaw Aggregates, Inc., 198 N.L.R.B. 598, 598 (1972).

The NLRB found that Bennett's search for jobs from July to December 1981 was sufficiently diligent. Bennett was not found to have "willfully incurred" First, Kawasaki's statement that Bennett applied to only six employers during the twenty-one week period discounts the fact that the ALJ credited...