N.L.R.B. v. Harvstone Mfg. Co., O-L
| Decision Date | 06 March 1986 |
| Docket Number | No. 84-3116,O-L,84-3116 |
| Citation | 785 F.2d 570 |
| Parties | 121 L.R.R.M. (BNA) 3371, 104 Lab.Cas. P 11,861 NATIONAL LABOR RELATIONS BOARD, Petitioner, v. HARVSTONE MANUFACTURING CORP., Duray Fluorescent Manufacturing Co., American Fluorescent Corp. and House-ite Corp., Respondents. |
| Court | U.S. Court of Appeals — Seventh Circuit |
J. Elligers, Appellate Court Branch, N.L.R.B., Washington, D.C., for petitioner.
John T. Weise, Seyfarth, Shaw, Fairweather & Geraldson, Robert E. Fitzgerald, Jr., Chicago, Ill., for respondents.
Before WOOD and ESCHBACH, Circuit Judges, and SWYGERT, Senior Circuit Judge.
The National Labor Relations Board (the "Board") petitions this court for enforcement of its order against Harvstone Manufacturing Corp. ("Harvstone"), Duray Fluorescent Manufacturing Co. ("Duray"), American Fluorescent Corp. ("American") and House-O-Lite Corp. ("House-O-Lite") (collectively the "Respondents"). This action arises out of unfair labor practice charges filed against the Respondents by Local 134, International Brotherhood of Electrical Workers (the "Union"). The charges against the four Respondents were consolidated and, after a hearing, the Board ruled 1 that the Respondents had violated section 8(a)(5) and (1) of the National Labor Relations Act (the "Act"), as amended, 29 U.S.C. Sec. 151, et seq., 2 by bargaining in bad faith and by unilaterally changing various terms and conditions of employment prior to reaching a bona fide bargaining impasse. The Board's order was predicated on a finding that the Respondents had made a claim of "inability to pay" and failed, after appropriate Union request, to disclose financial data substantiating their claim. The Board determined that the Respondents' failure to disclose the requested financial records was itself bad faith bargaining that precluded the negotiating parties from reaching a bona fide impasse. By definition, therefore, the Respondents' unilateral changes in wages and other terms of employment were violative of the Act.
The primary issue before us, consequently, is whether there is substantial evidence in the record as a whole to support the Board's finding that the Respondents pleaded inability to pay. A tangential issue we must also decide is whether a cost-of-living adjustment in the collective bargaining agreements between the Union and the Respondents became effective and therefore due to be implemented prior to the expiration of the agreements. The Union argues that the adjustment had already accrued to the employees' benefit before the agreements expired and was therefore a permissive subject of bargaining over which a bargaining impasse could not lawfully be reached.
For the reasons stated below, we deny enforcement of the Board's order as it relates to Respondents Harvstone, American, and House-O-Lite and modify and enforce the order as it applies to Respondent Duray.
The Respondents are all manufacturers of fluorescent lighting fixtures in the Chicago area. Since 1964 the Respondents have recognized, bargained with and individually executed several collective bargaining agreements with the Union. The last of these agreements were three-year pacts that expired on August 31, 1982. The unfair labor practice charges which are the subject of this action arose out of negotiations between the Respondents and the Union beginning in August 1982. During these negotiations, all four Respondents were represented by Ray J. Schoonhoven. Although theoretically each bargaining session was limited to negotiations regarding one particular employer, the parties recognized that the final agreements between the Union and each Respondent would be substantially identical.
The Respondents came to the bargaining table seeking concessions from the Union claiming that they were operating at a competitive disadvantage relative to their counterparts in other portions of the United States. To substantiate their claim, the Respondents prepared a schedule comparing the wages and benefits paid by several of their competitors, also represented by the International Brotherhood of Electrical Workers, with their own labor costs. This schedule, which was given to the Union, purported to show that the costs paid by these competing manufacturers were significantly less than those incurred by the Respondents.
Armed with these figures, the Respondents met with Union representatives during pre-negotiation sessions during the spring and summer of 1982, and commenced actual negotiations toward new collective bargaining agreements on August 11 of that year. During these sessions, the Respondents proposed a reduction in wages, insurance and pension benefits, and the elimination of cost-of-living adjustment clauses. The Union, on the other hand, stated that it would make no concessions and, in fact, initially proposed a wage increase. Additionally, in response to the claims of competitive disadvantage, the Union sought the Respondents' financial records claiming that if the employers were predicating their bargaining stance on economic problems, they were required to produce substantiating data. The Respondents' only response was that they were not pleading inability to pay.
In total, the parties met eight times during August 1982, with the final session taking place on August 31, the day the collective bargaining agreements between the parties expired. Throughout these eight sessions, apart from the concessions the Respondents were seeking, another bone of contention was a cost-of-living adjustment which the Union claims accrued to the employees' benefit on August 30, 1982. The Respondents contend that the cost-of-living adjustment was not part of the expired collective bargaining agreements. During the life of the agreements, cost-of-living adjustments became effective each March 1 and September 1. The adjustments were based on reviews of the Bureau of Labor Statistics Consumer Price Index (the "CPI"). These reviews were to take place during each January and July immediately preceding the March 1 or September 1 effective dates. The Respondents contend that no adjustment was due on September 1, 1982, since the collective bargaining agreements expired prior to the time the adjustment was to become effective.
The parties were unable to resolve their differences, especially with respect to the cost-of-living adjustment issue, and after the August 31 meeting the parties did not meet again until November 8, 1982. The parties met several more times during November and December but failed to reach an accord. Although several negotiating sessions did take place after August 31, the parties do not contest the fact that, if we find the Respondents to have bargained in accordance with the Act, a bona fide impasse was reached on that date.
Following the expiration of the collective bargaining agreements, the Respondents instituted several unilateral changes including alteration of vacation schedules and elimination of paid five-minute wash-up periods, certain Christmas bonuses, gifts and parties, and group insurance benefits for the dependents of employees. In addition, the Respondents never implemented the cost-of-living adjustment that the Union claims was due and payable. In December 1982, the Union filed unfair labor practice charges against the four Respondents individually. The four charges were consolidated and a hearing was held before an administrative law judge (the "ALJ") on June 28-30, 1983.
The ALJ ruled that the Respondents violated section 8(a)(5) and (1) of the Act by unlawfully making unilateral changes in wages and other terms and conditions of employment before a bona fide impasse had been reached and by, after pleading inability to pay, refusing to supply financial data requested by the Union. The ALJ determined that the cost-of-living adjustment had in fact accrued prior to the expiration of the collective bargaining agreements and that the adjustment was therefore a permissive subject of bargaining over which the Respondents could not lawfully bargain to an impasse. The ALJ also ruled that no bona fide impasse had been reached since the Respondents' bad faith refusal to supply financial information precluded their right to pronounce such an impasse.
The Board summarily affirmed the decision of the ALJ. Notably, however, the Board did not rely on the ALJ's conclusion with respect to the cost-of-living adjustment. Rather, the Board based its decision solely on the finding that the Respondents failed to bargain in good faith by refusing to disclose financial data after pleading inability to pay.
The Board ordered the Respondents, among other things, to cease and desist from the unfair labor practices found, to reinstate the terms of employment unilaterally changed by the Respondents (including the cost-of-living adjustment), 3 to compensate the employees for losses sustained as a result of the unilateral changes, to make the Respondents' financial records available to the Union and to bargain in good faith with the Union upon its request. The Board now petitions this court for enforcement of its order. The Union has intervened in these proceedings contending that the Board should have also affirmed the ALJ's finding that the cost-of-living adjustment was a permissive subject of bargaining over which the parties could not lawfully bargain to impasse.
We acknowledge the maxim that a decision of the Board should not be set aside if it is supported by substantial evidence. Universal Camera Corp. v. NLRB, 340 U.S. 474, 487, 71 S.Ct. 456, 463, 95 L.Ed. 456 (1951); NLRB v. Lewis University, 765 F.2d 616, 620 (7th Cir.1985); 29 U.S.C. Sec. 160(f). Review of a Board decision requires that the court examine the entire record, "including the evidence opposed to the Board's view from which conflicting inferences reasonably could be drawn." NLRB v. Adam and Eve Cosmetics, Inc., 567 F.2d 723, 727 (7th...
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