N.L.R.B. v. Mercy Peninsula Ambulance Service, Inc.

• Citation: 589 F.2d 1014
• Decision Date: 18 January 1979
• Docket Number: No. 78-1010,78-1010
• Parties: 100 L.R.R.M. (BNA) 2769, 85 Lab.Cas. P 11,113 NATIONAL LABOR RELATIONS BOARD, Petitioner, v. MERCY PENINSULA AMBULANCE SERVICE, INC., Respondent.
• Court: U.S. Court of Appeals — Ninth Circuit

Page 1014

589 F.2d 1014

100 L.R.R.M. (BNA) 2769, 85 Lab.Cas. P 11,113

NATIONAL LABOR RELATIONS BOARD, Petitioner, v. MERCY PENINSULA AMBULANCE SERVICE, INC., Respondent.

No. 78-1010.

United States Court of Appeals Ninth Circuit.

Jan. 18, 1979.

Ellen Spangler (argued), Washington, D. C., for petitioner.

Harold W. Martin (argued), San Mateo, Cal., for respondent.

Petition to Review a Decision of the National Labor Relations Board.

Before DUNIWAY and CHOY, Circuit Judges, and POOLE ^*, District Judge.

CHOY, Circuit Judge:

The National Labor Relations Board (NLRB or the Board), pursuant to Section 10(e) of the National Labor Relations Act (NLRA or the Act), 29 U.S.C. §§ 151-169, and 29 C.F.R. § 102.52, applies to this court for enforcement of a supplemental order issued against Mercy Peninsula Ambulance Service, Inc. (Mercy). The supplemental order provided, in accordance with the Board's previous finding that Mercy had violated § 8(a)(3) & (1) of the Act, ¹ that discriminatee Douglas Castle was entitled to receive backpay from Mercy in the amount of $7,659.56 plus interest at 7% Per annum. ² We deny enforcement of the Board's supplemental order.

I. Statement of the Case

Douglas Castle was employed by Mercy from October of 1973 to June 19, 1974. While in Mercy's employ, Castle prepared and circulated a petition that listed pay grievances against Mercy and which ultimately was sent to the Employment Standards Administration of the Department of Labor. Castle's activities were discovered by Mercy's president and others. Castle was subsequently discharged. After his discharge, Castle filed charges against Mercy, claiming that Mercy had committed multiple violations of the Act in discharging him.

The Board issued a decision, after a hearing before an Administrative Law Judge (ALJ), that Castle's discharge was discriminatory ³ and ordered that Mercy immediately reinstate Castle and compensate him for the loss of earnings he suffered as a result of his discharge. The issue of the amount of backpay due Castle was reserved for a subsequent hearing. In anticipation of this backpay hearing, Mercy and the NLRB agreed that "(i)n the event judicial proceedings are . . . necessary to enforce or to review the Board's backpay determination, the only issue before the court will be the validity of the backpay computation."

A supplemental backpay proceeding was instituted and the presiding ALJ found "that Castle did not make a reasonable and diligent effort to find work during the period from the date of his discharge to November 15, 1974." He found that Castle was, therefore, not entitled to backpay for that period. Although expressing doubt as to Castle's diligence in mitigating his loss of income from November 15, 1974 to March 31, 1975, ⁴ the ALJ concluded that Mercy had failed to prove that Castle had not made "reasonable and diligent efforts to find employment" and that Castle was thus entitled to backpay for that period. Castle was awarded $3,537.17 with interest at 6% Per annum.

On December 30, 1976, the backpay order issued by the ALJ was reviewed by the NLRB. The Board was in agreement with the ALJ's determination that Castle was entitled to backpay for the period November 16, 1974 to March 31, 1975. However, the Board found that the ALJ erred in rejecting Castle's claim for backpay from June 19, 1974 to November 15, 1974. Contrary to the ALJ's findings, the Board concluded that the evidence presented indicated "Castle's persistent efforts to obtain employment from the date of his discharge through November 15." This persistence, the Board found, "clearly manifest(ed) appropriate diligence to mitigate (Mercy's) financial loss" and that Mercy had not sustained its burden of proving that Castle incurred a wilful loss of earnings. The Board ordered Mercy to pay Castle $7,659.56 net backpay with interest at 7% Per annum. The Board now seeks enforcement of its supplemental decision and order. ⁵

II. Mercy's Backpay Liability

Mercy urges that the supplemental order not be enforced, contending that the Board's determination that Castle exercised reasonable efforts to secure employment for the nine month period following his discharge and that he is entitled to backpay for that period is in error.

Section 10(c) of the NLRA, 29 U.S.C. § 160(c), authorizes the NLRB to require that an employer guilty of unfair labor practices desist from such practices and "take such affirmative action, including reinstatement of employees with or without back pay, as will effectuate the policies of (the Act)." The Supreme Court has stated that the Board's arsenal of reinstatement and backpay

is remedial, not punitive, and is to be exercised in aid of the Board's authority to restrain violations and as a means of removing or avoiding the consequences of violation where those consequences are of a kind to thwart the purposes of the Act.

Local 60 v. NLRB, 365 U.S. 651, 655, 81 S.Ct. 875, 877, 6 L.Ed.2d 1 (1961), Quoting Consolidated Edison Co. v. NLRB, 305 U.S. 197, 236, 59 S.Ct. 206, 83 L.Ed. 126 (1938); See NLRB v. Seven-Up Co., 344 U.S. 344, 346, 73 S.Ct. 287, 97 L.Ed. 377 (1953); Phelps Dodge Corp. v. NLRB, 313 U.S. 177, 197-98, 61 S.Ct. 845, 85 L.Ed. 1271 (1941); Daylin, "Back Pay Under the National Labor Relations Act," 39 Iowa L.Rev. 104, 104 (1958). A worker who has been the victim of an unfair labor practice is not entitled to simply await reimbursement from his or her employer for wages lost, for "the statute was not intended to encourage idleness." Daylin at 117; See NLRB v. Seven-Up Co., 344 U.S. at 346, 73 S.Ct. 287; Phelps Dodge Corp. v. NLRB, 313 U.S. at 200, 61 S.Ct. 845. To hold otherwise would undermine the "healthy policy" underlying the Act, "promoting production and employment." Phelps Dodge Corp. v. NLRB, 313 U.S. at 200, 61 S.Ct. 845. Where the backpay award does not effectuate the policies of the Act, it should not be enforced. See NLRB v. Dodson's Market, Inc., 553 F.2d 617, 620 (9th Cir. 1977).

Consistent with the policies of the Act, the rule is that once the general counsel of the Board has established the amount of backpay due the discharged employee, the burden is upon the employer to produce evidence to mitigate its liability. Id. at 619; NLRB v. United Brotherhood of Carpenters & Joiners, 531 F.2d 424, 426 (9th Cir. 1976). Mitigation will result not only where the worker has taken in earnings from another source after discharge, but also for "losses willfully incurred" such as when the discriminatee fails to secure comparable employment without excuse. Phelps Dodge Corp. v. NLRB, 313 U.S. at 197-98, 61 S.Ct. 845. A discharged worker is not held to the highest standard of diligence in his or her efforts to secure comparable employment; "reasonable" exertions are sufficient. See Heinrich Motors, Inc. v. NLRB, 403 F.2d 145, 149 (2nd Cir. 1968); NLRB v. Arduini Manufacturing Corp., 394 F.2d 420, 423 (1st Cir. 1968); NLRB v. Miami Coca-Cola Bottling Co., 360 F.2d 569, 575 (5th Cir. 1966); NLRB v. Brown & Root, Inc., 311 F.2d 447, 452 (8th Cir. 1963).

The issue we must now decide is whether the evidence supports the Board's finding that discriminatee Castle in fact discharged the duty incumbent upon him to exercise "reasonable diligence" in seeking comparable employment. The appropriate standard of review dictates that, to the extent the Board's decision rests on findings of fact for which there is "substantial evidence" on the record as a whole, this court must defer to that decision. 29 U.S.C. § 160(e); Universal Camera Corp. v. NLRB, 340 U.S. 474, 488, 71 S.Ct. 456, 95 L.Ed. 456 (1951); NLRB v. Tomco Communications, Inc., 567 F.2d 871, 876 (9th Cir. 1978). On numerous occasions the courts have attempted to articulate the nebulous ingredients of the "substantial evidence" standard. The Supreme Court has stated that "substantial evidence is more than a mere scintilla. It means such relevant evidence as a reasonable mind might accept as adequate to support a conclusion." Consolidated Edison v. NLRB, 305 U.S. at 229, 59 S.Ct. at 217; See NLRB v. Columbian Enameling & Stamping Co., 306 U.S. 292, 299-300, 59 S.Ct. 501, 83 L.Ed. 660 (1939) (imposing a directed verdict standard).

Upon review, the record reveals that Castle made attempts at securing employment an average of only three times a month during each of the nine months that he was in the job market after his discharge. ⁶ We do not believe that it is reasonable to conclude that so few attempts constitute "reasonable diligence." See NLRB v. Arduini Manufacturing Corp., 394 F.2d at 424 (discriminatee not reasonably diligent where he did not apply to company that he knew was hiring in his field of work, visited only four companies in search of employment and merely registered with the Employment Security Office); NLRB v. Armstrong Tire & Rubber Co., 263 F.2d 680, 683 (5th Cir. 1959) (discriminatee not reasonably diligent where he devoted full time efforts for six months to his wife's business and thereafter made infrequent attempts to secure employment elsewhere). ⁷ To hold otherwise would run contrary to the purposes of the backpay remedy, encourage idleness and reward slothfulness.

We conclude that the Board's finding that Castle was reasonably diligent in seeking employment after his discriminatory discharge is not supported by substantial evidence ⁸ and that Mercy has adequately met its burden of proving that Castle breached his duty of mitigating his loss. ⁹

ENFORCEMENT DENIED.

* The Honorable Cecil F. Poole, United States District Judge for the Northern District of California, sitting by designation.

1 The Board's decision finding that Mercy violated § 8(a)(3) and (1) is reported at 217 N.L.R.B. 829 (1975).

2 The Board's supplemental decision and order is reported at 232 N.L.R.B. No. 149.

3 Mercy's requirement that employees sign a statement declaring their allegiance to union membership immediately upon accepting employment was held violative of...