N.L.R.B. v. Litton Financial Printing Div., a Div. of Litton Business Systems, Inc., s. 88-7065
| Decision Date | 16 January 1990 |
| Docket Number | 88-7079,Nos. 88-7065,s. 88-7065 |
| Citation | 893 F.2d 1128 |
| Parties | 133 L.R.R.M. (BNA) 2354, 58 USLW 2491, 114 Lab.Cas. P 11,842 NATIONAL LABOR RELATIONS BOARD, Petitioner, Printing Specialties District Council Number 2, as successor to Printing Specialties District Council Number 1, Petitioner-Intervenor, v. LITTON FINANCIAL PRINTING DIVISION, A DIVISION OF LITTON BUSINESS SYSTEMS, INC., Respondent. PRINTING SPECIALTIES DISTRICT COUNCIL NUMBER 2, as successor to Printing Specialties District Council Number 1, Petitioner, v. NATIONAL LABOR RELATIONS BOARD, Respondent. |
| Court | U.S. Court of Appeals — Ninth Circuit |
David A. Fleischer, N.L.R.B., Washington, D.C., for petitioner, respondent.
David A. Rosenfeld, Van Bourg, Weinberg, Roger & Rosenfeld, San Francisco, Cal., for petitioner-intervenor.
M.J. Diederich, Beverly Hills, Cal., for respondent.
Application for Enforcement and Petition for Review of an Order of the National Labor Relations Board.
Before FARRIS, BOOCHEVER and HALL, Circuit Judges.
In No. 88-7065, the National Labor Relations Board ("NLRB" or "the Board") seeks enforcement of an order it issued against employer Litton Financial Printing Division ("Litton") on November 6, 1987. In No. 88-7079, Printing Specialties District Council Number 2 ("the Union"), petitions this court for review of the same Board order. The instant dispute arose in 1980 when Litton decided to close down the "cold-type" printing operation in its Santa Clara, California, plant, to expand its more efficient "hot-type" operation in the same plant, and to lay off ten employees who had worked primarily on "cold-type" equipment. At that time, the last of a series of collective bargaining agreements ("CBAs") had expired and Litton was refusing to recognize or bargain with the Union.
In the proceedings below, the Board found that Litton violated sections 8(a)(5) and 8(a)(1) of the National Labor Relations Act ("NLRA" or "the Act") by refusing to bargain over the layoffs, by directly dealing with the laid-off employees over severance pay, by refusing to accept or process grievances filed to protest the layoffs as violative of seniority rights, and by effectuating a wholesale repudiation of its obligations under the contractual grievance-arbitration provisions. To remedy these unfair labor practices, the Board issued a "cease and desist" and limited backpay order. The Board also ordered Litton to process the layoff grievances through the first two steps of the grievance-arbitration procedure, to bargain over the layoff decision, and to post appropriate notices. The Board declined, however, to order Litton to arbitrate the layoff grievances.
On appeal, Litton argues: (1) that the layoff was not a mandatory subject of bargaining, and that it had fulfilled its statutory obligation to bargain over the "effects" of the layoff decision; (2) that the grievance-arbitration provisions of the CBA expired in October of 1979 along with the contract or, at a minimum, had become ineffective by the time the grievances were filed almost a year later; (3) that the Board erred in finding a wholesale repudiation by Litton of its obligations under the grievance-arbitration process contained in the expired CBA.
In its appeal, the Union argues that the Board erred in its interpretation of section 8(a)(5) by relying on case law under section 301 of the Act, 29 U.S.C. Sec. 185, to hold that the layoff grievances in this case are not encompassed within Litton's duty to arbitrate post-expiration grievances that "arise under" the expired CBA. The Union further maintains that the correct legal framework for analyzing an employer's refusal to process and arbitrate post-expiration or hiatus grievances is under the case law holding that an employer violates section 8(a)(5) by imposing a unilateral change in a term or condition of employment, i.e., a "mandatory subject of bargaining," without bargaining to impasse. Accordingly, the Union seeks reversal of the Board's order insofar as it declined to compel arbitration of the layoff grievances.
Most of the facts relevant to decision of this appeal are undisputed or were found by an administrative law judge ("ALJ") in a hearing held on March 19, 1981. The employer in this case, Litton Financial Printing Division, is a division of Litton Business Systems, Inc., in the business of printing bank checks. Printing Specialties District Council Number 2 is the successor to the exclusive bargaining representative for the production and maintenance employees at Litton's plant in Santa Clara, California, the only one of six Litton printing facilities involved in this case. Beginning in 1974, Litton and the Union were parties to successive CBAs. The last such contract expired on October 5, 1979. 1
Prior to August 1980, Litton used both cold-type and hot-type printing processes at its Santa Clara plant; its other five plants used only the hot-type process. In July 1980, Litton decided to convert the Santa Clara facility to an entirely hot-type operation after one of its major customers, Wells Fargo Bank, canceled 30 per cent of its cold-type print orders. A Litton representative testified that this decision was based on four factors: (1) the loss of the Wells Fargo and other customer orders; (2) the greater economy of the hot-type process by which more checks could be printed on a single sheet of paper; (3) the increased flexibility to have other Litton plants take over the Santa Clara plant's work in emergencies; (4) the reduction in training, research and development, and equipment costs. To accomplish the planned conversion, Litton transferred some of its cold-type work to other plants, sold some of its cold-type equipment, and acquired additional hot-type equipment.
The instant dispute arose on August 29 and September 2, 1980, when Litton laid off ten of the 42 workers in the Santa Clara plant bargaining unit. Seven of the laid-off employees had worked exclusively on cold-type equipment; the other three had worked primarily, but not exclusively, on cold-type equipment. The layoffs were uncontrovertedly effectuated without notice to the Union, and were not in accordance with seniority. In fact, six of the eleven most senior employees in the Santa Clara bargaining unit were among those laid off. Litton dealt directly with the individual laid-off employees to give them severance pay without giving notice to or bargaining with the Union over that issue. 2
The affected employees notified the Union of the layoffs; the Union, in turn, filed separate but identical grievances for each one alleging "unjust layoff ... out of seniority." By letter dated September 24, 1980, the Union's business agent notified Litton that the grievances had been filed by the shop steward, and requested that the employer meet with Union representatives to discuss the layoff and its impact on the senior employees who were dismissed. The Union also requested that the laid-off employees be reinstated pending resolution of the grievances. In a letter dated November 10, 1980, the Union reiterated its demands to utilize the grievance-arbitration procedures and bargain about "both the decision to layoff the workers and the effects upon those employees," and requested relevant information.
Litton refused to process the layoff grievances, maintaining that it had no obligation to do so because the CBA containing the grievance and arbitration procedures had expired. Although it expressed a willingness to bargain over the "effects" of the layoffs, Litton has consistently refused to bargain over the "decision" to lay off the ten employees.
On these facts, a majority of the Board panel found, in agreement with the ALJ, that Litton was obligated to continue processing grievances during the hiatus period under its expired agreement. The Board also ruled that Litton's refusal to do so constituted a wholesale repudiation of its contractual obligations under the grievance and arbitration provisions of the expired contract and was, therefore, a violation of sections 8(a)(5) and 8(a)(1) of the Act.
The Board also decided, contrary to the ALJ, that Litton's obligation to bargain about the effects on unit employees of its decision to convert its Santa Clara operation from cold-type to hot-type processes included a duty to bargain about its decision to lay off the ten employees. The Board, therefore, concluded that Litton's refusal to bargain upon demand by the Union over these mandatory subjects of bargaining was a further violation of sections 8(a)(5) and 8(a)(1) of the Act.
In its order, the NLRB required Litton to cease and desist from engaging in the unfair labor practices found. The Board also ordered Litton, upon the Union's request, to: (1) process the layoff grievances under the first two steps of the grievance procedure found in the expired CBA; (2) bargain with the Union over the layoffs as effects of its decision to convert to a hot-type operation; (3) pay backpay to the ten laid-off employees in accordance with Transmarine Navigation Corp., 170 N.L.R.B. 389 (1968), on remand from 380 F.2d 933 (9th Cir.1967); and (4) post appropriate notices. The Board and the Union jointly seek enforcement of the Board's order as heretofore described.
In the portion of its order challenged by the Union, the Board declined to order Litton to arbitrate the layoff grievances. The Board asserted that these grievances, which were based on conduct occurring after the CBA expired, did not "arise under" the contract and that Litton, therefore, had no legal or contractual obligation to arbitrate them.
In general, an order of the National Labor Relations Board must be enforced if the Board correctly applied the law, and if the Board's findings of fact are supported by substantial evidence on the record viewed as a whole. Oil, Chemical & Atomic Workers Int'l Union, Local 1-547 v. NLRB, ...
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