N.L.R.B. v. Auto Fast Freight, Inc.

• Decision Date: 10 July 1986
• Docket Number: No. 84-7829,84-7829
• Citation: 793 F.2d 1126
• Parties: 122 L.R.R.M. (BNA) 3058, 104 Lab.Cas. P 11,893 NATIONAL LABOR RELATIONS BOARD, Petitioner, v. AUTO FAST FREIGHT, INC., Respondent.
• Court: U.S. Court of Appeals — Ninth Circuit

Page 1126

793 F.2d 1126

122 L.R.R.M. (BNA) 3058, 104 Lab.Cas. P 11,893

NATIONAL LABOR RELATIONS BOARD, Petitioner, v. AUTO FAST FREIGHT, INC., Respondent.

No. 84-7829.

United States Court of Appeals, Ninth Circuit.

Argued and Submitted Dec. 3, 1985.

Decided July 10, 1986.

John G. Elligers, Joseph Oertl, N.L.R.B., Washington, D.C., for petitioner.

William J. Brunick, Donald R. Alvarez, Brunick, Pyle & Ludvigsen, San Bernardino, Cal., for respondent.

Application for Enforcement of an Order of the National Labor Relations Board.

Before GOODWIN and BOOCHEVER, Circuit Judges, and SPENCER WILLIAMS, ^* District Judge.

SPENCER WILLIAMS, District Judge:

Respondent, Auto Fast Freight, Inc. ("Auto Fast"), is charged by the petitioner, National Labor Relations Board ("Board") with violating sections 8(a)(1), (3) and (5) of the National Labor Relations Act ("NLRA"), 29 U.S.C. Secs. 158(a)(1), (3) and (5) (1982). The Board found that Auto Fast committed several unfair labor practices, and ordered corresponding relief. 272 N.L.R.B. 561 (1984). The matter is before the court on the Board's application for enforcement of its order. Auto Fast seeks review of the Board's decision and order, on the ground that the Board's decision is

not supported by substantial evidence. Because we find ample support in the record for the Board's findings and factual conclusions, we grant the Board's petition for enforcement, and deny Auto Fast's request for review.

FACTS AND PROCEEDINGS BELOW

Since 1962, Auto Fast has been a signatory to a series of collective bargaining agreements with three union locals, involving a single unit of drivers, driver helpers, dockworkers and mechanics employed at Auto Fast's facilities in Montebello, San Bernardino and San Diego, California. ¹ The most recent collective bargaining agreement was signed in 1979, for a term expiring on March 31, 1982. That contract was a "short form" agreement, adopting the National Master Freight Agreement and the Western Master Area Freight Agreement, as well as all supplements thereto.

Beginning in 1979, Auto Fast began to incur substantial operating losses, due to the effects of inflation and the deregulation of the trucking industry. In January, 1982, Auto Fast's financial advisor recommended immediate action to reduce costs. In the meantime, in November, 1981, Auto Fast and the Western Conference of Teamsters began exchanging letters proposing the commencement of bargaining for a new contract. Both sides indicated a desire to meet, but they failed to reach agreement as to the date and location for such a meeting. 272 N.L.R.B. at 562. The parties did not meet until April 9, 1982, nine days after the collective bargaining agreement expired.

As a result of its deteriorating financial condition and its inability to meet with the union, Auto Fast decided to act on its own to reduce costs. On April 5, 1982, five days after the expiration of the collective bargaining agreement, Auto Fast discontinued its payments to the union's health and welfare fund (substituting a health insurance plan of its own), and reduced the wages of all unit employees by approximately $2.00 an hour. These actions were taken without notification to, or bargaining with, the Western Conference or any local. 272 N.L.R.B. at 562.

In late March, 1982, two members of Local 542, John Sloan and Manuel Garza, were allegedly told by a company manager that Auto Fast was about to "go non-union," and that they would have to discontinue their union membership in order to continue working there. When Sloan and Garza refused to relinquish their membership in the union, they were allegedly forced to resign from their jobs. Auto Fast contends that these employees voluntarily submitted their resignations because of the uncertainty surrounding the expiration of the collective bargaining agreement.

The Board adopted the findings of its administrative law judge, that the company refused to bargain, in violation of sections 8(a)(5) and (1) of the NLRA, by unilaterally discontinuing payments to the union's health and welfare fund, by unilaterally instituting a new medical insurance plan for employees, and by unilaterally decreasing the wages of unit employees. The ALJ and Board also found that the company constructively discharged Sloan and Garza because of their union membership, in violation of sections 8(a)(3) and (1) of the NLRA.

STANDARD OF REVIEW

On review in this court, the NLRB's findings of fact "if supported by substantial evidence on the record considered as a whole shall be conclusive." 29 U.S.C. Sec. 160(e). See Walla Walla Union-Bulletin, Inc. v. NLRB, 631 F.2d 609, 612 (9th Cir.1980). A court reviewing the Board's factual findings "may not 'displace the

                Board's choice between two fairly conflicting views, even though the court would justifiably have made a different choice had the matter been before it de novo.' "    NLRB v. Walton Manufacturing Co., 369 U.S. 404, 405, 82 S.Ct. 853, 854, 7 L.Ed.2d 829 (1962) (quoting Universal Camera Corp. v. NLRB, 340 U.S. 474, 488, 71 S.Ct. 456, 465, 95 L.Ed. 456 (1951))
                

ANALYSIS

I. Unilateral Change of a Term or Condition of Employment

Section 8(a)(5) of the NLRA makes it an unfair labor practice for an employer "to refuse to bargain collectively with the representatives of his employees...." Collective bargaining is defined in Sec. 8(d) as requiring an employer and union "to meet at reasonable times and confer in good faith with respect to wages, hours, and other terms and conditions of employment." See Fibreboard Paper Products Corp. v. NLRB, 379 U.S. 203, 210, 85 S.Ct. 398, 402, 13 L.Ed.2d 233 (1964). There is no dispute that subjects such as wages, health care plans and insurance plans are within Sec. 8(d)'s definition of mandatory subjects of bargaining. Unless and until the parties to a collective bargaining agreement "bargain to impasse" on a mandatory subject of bargaining, an employer's unilateral action with respect to such a matter will constitute a refusal to bargain. NLRB v. Katz, 369 U.S. 736, 743, 82 S.Ct. 1107, 1111, 8 L.Ed.2d 230 (1962). Even after the collective bargaining agreement has expired, the employer is prohibited from taking unilateral action until the parties have bargained to impasse. "The employer is required to maintain [the] status quo following the expiration of the collective bargaining agreement until the parties negotiate a new agreement or bargain in good faith to impasse." NLRB v. Carilli, 648 F.2d 1206, 1214 (9th Cir.1981). See also Clear Pine Mouldings, Inc. v. NLRB, 632 F.2d 721, 729 (9th Cir.1980), cert. denied, 451 U.S. 984, 101 S.Ct. 2317, 68 L.Ed.2d 841 (1981).

There exists a narrow exception to the bargain to impasse rule: where, upon expiration of a collective bargaining agreement, the union has avoided or delayed bargaining, and the employer has given notice to the union of the specific proposals the employer intends to implement, the employer may unilaterally implement the proposals without first bargaining to impasse. Stone Boat Yard v. NLRB, 715 F.2d 441, 444 (9th Cir.1983), cert. denied, 466 U.S. 937, 104 S.Ct. 1910, 80 L.Ed.2d 459 (1984). Accord, M & M Building & Electrical Contractors, Inc., 262 N.L.R.B. 1472, 1476-77 (1982).

Auto Fast acknowledges that it acted unilaterally, without first bargaining to impasse. Auto Fast contends, however, that its dire financial condition and the union's unwillingness to meet justified its unilateral action. Although there is some evidence in the record that would support Auto Fast's position, the Board rejected Auto Fast's interpretation of the facts. The question on this appeal, then, is whether substantial evidence existed for the Board to reach its conclusion.

As to Auto Fast's argument that its precarious financial position made immediate action imperative, the Board, noting that the company had been aware of its severe economic problems at least since January, 1982, found that "there was no reasonable basis for taking such action so soon after expiration of the contract" on March 31, 1982. 272 N.L.R.B. at 563. Although Auto Fast protests that the evidence it presented to the ALJ showed a high degree of urgency, the Board's resolution of this factual dispute is fully supported by substantial evidence. The Board had before it evidence of the company's mounting losses beginning in 1979 and the increasing financial pressure on the company in January and February of 1982. The Board could reasonably conclude from this evidence that Auto Fast's financial difficulties did not, on April 5, 1982, suddenly rise to the level of urgency that would justify taking unilateral action.

As to Auto Fast's contention that the union was avoiding the bargaining table the Board concluded that "there is nothing in the record to show that the Unions intentionally were ducking Respondent.... It does appear that the Unions were not well coordinated, and possibly were uncertain of their administrative responsibilities, but those facts do not justify Respondent's unilateral actions." Id. Again, substantial evidence supports this conclusion. In the exchange of letters between the parties beginning in November, 1981, both sides clearly indicated a desire to meet, and each proposed dates and locations; however, no meeting occurred until April 9, 1982. 272 N.L.R.B. at 562. On the record before the Board, it would have been possible to place the blame for the failure to meet on either or both of the parties. Although the letters written by Auto Fast's attorney could lead to an opposite conclusion, the Board's determination of this matter is based on substantial evidence.

Auto Fast contends in addition that its unilateral action was justified by its confusion over which branch of the union to bargain with. Auto Fast argues that it was notified by the Western Conference of Teamsters that only the Teamsters National Freight Industry Negotiating Committee was authorized to represent the union,...