N.L.R.B. v. Plainville Ready Mix Concrete Co.

• Decision Date: 26 January 1995
• Docket Number: No. 93-5337,93-5337
• Citation: 44 F.3d 1320
• Parties: 148 L.R.R.M. (BNA) 2348, 129 Lab.Cas. P 11,270 NATIONAL LABOR RELATIONS BOARD, Petitioner, v. PLAINVILLE READY MIX CONCRETE COMPANY, Respondent.
• Court: U.S. Court of Appeals — Sixth Circuit

Page 1320

44 F.3d 1320

148 L.R.R.M. (BNA) 2348, 129 Lab.Cas. P 11,270

NATIONAL LABOR RELATIONS BOARD, Petitioner, v. PLAINVILLE READY MIX CONCRETE COMPANY, Respondent.

No. 93-5337.

United States Court of Appeals Sixth Circuit.

Argued June 13, 1994.

Decided Jan. 26, 1995.

Randy Frye, Director, N.L.R.B., Cincinnati, OH, Aileen A. Armstrong, Dep. Asso. Gen. Counsel, Frederick C. Havard (briefed), Lisa Richardson Shearin (argued and briefed), N.L.R.B., Appellate Court Branch, Washington, DC, for petitioner.

James K.L. Lawrence (argued and briefed), Raymond D. Neusch, Frost & Jacobs, Cincinnati, OH, for respondent.

Before CONTIE, MILBURN, and BATCHELDER, Circuit Judges.

CONTIE, J., delivered the opinion of the court, in which MILBURN, J., joined. BATCHELDER, J. (pp. 1340-1345), delivered a separate dissenting opinion.

CONTIE, Circuit Judge.

Petitioner, the National Labor Relations Board ("NLRB" or "the Board"), petitions for enforcement of an order of the Board finding respondent, Plainville Ready Mix Concrete Co. ("Plainville" or "the Company"), in violation of Sec. 8(a) of the National Labor Relations Act ("NLRA" or "the Act"). For the following reasons, the petition for enforcement of the Board's order is granted.

I.

On April 5, 1990, the Regional Director for Region 9 of the NLRB issued a consolidated complaint, subsequently amended, alleging that following a lawful impasse in bargaining, respondent Plainville Ready Mix Concrete Co. violated sections 8(a)(1) and (5) of the NLRA ¹ by unlawfully implementing certain mandatory subjects of bargaining, which were changes in terms and conditions of employment not encompassed in the Company's prior offers during negotiations with the Truckdrivers, Chauffeurs, and Helpers Local Union No. 100, affiliated with the International Brotherhood of Teamsters, AFL-CIO ("the Union") and were implemented without having afforded the Union an opportunity to bargain on the changes.

On March 5, 1992, a hearing on the consolidated complaint was conducted before an administrative law judge ("the ALJ"). On June 30, 1992, the ALJ issued a decision in which he concluded that on May 1, 1989, the Company violated section 8(a)(5) of the Act by implementing provisions of a wage proposal and a health plan that were inconsistent with its pre-impasse proposals to the Union, which the Union had rejected in negotiations. The ALJ additionally recommended that certain Plainville employees be made whole for any losses they had sustained by virtue of the Company's unlawful implementation of the wage and health plans. On November 27, 1992, the NLRB issued its decision and order in which it affirmed the ALJ's rulings and adopted his recommended order. The NLRB petitioned for enforcement of its decision and order on March 15, 1993, and respondent Plainville filed its answer on March 30, 1993.

The Company manufactures, distributes, and sells ready mix concrete. The Union, which has had a bargaining relationship with the Company since the 1960s, represents approximately forty employees in a unit consisting of ready mix drivers, yard employees, and mechanics at the Company's facilities in Batavia, Ohio, and Wilder, Kentucky. The last collective bargaining agreement ("CBA") between the parties prior to the hearing before the ALJ was effective from July 1, 1985 through January 31, 1988. Prior to the expiration of this agreement on January 31, 1988, the parties met on January 12, 19, 22, and 25, 1988 to negotiate a new agreement. During these negotiation sessions, the Company indicated its desire to decrease unit employees' fixed hourly wage rate, allegedly in order to compete successfully in the market. Under the then-existing collective bargaining agreement, drivers with two or more years of service were paid $10.27 per hour.

At the January 22nd bargaining session, in its first economic proposal, the Company proposed to reduce the fixed hourly wage rate of drivers with two or more years of service from $10.27 per hour to $9.00 per hour in the first year of a new three-year contract, in conjunction with implementing gain sharing ² and incentive pay plans, ³ which were offered along with the proposed reduction in the fixed hourly wage rate as a way for employees to recoup the loss in wages due to this reduction. ⁴ The proposed gain sharing and incentive pay plans were not terms of the existing collective bargaining agreement and were presented as an amendment to it. The proposed reduction in the fixed hourly wage rate was offered in conjunction with the gain sharing and incentive pay plans as a "total package deal" for the remuneration of unit employees. The Company advised the Union that although the wage proposal reduced the fixed hourly wage rate, the total wage package could equal or exceed employees' current earnings because of the supplemental wages earned through gain sharing and incentive pay. James Lawrence, the Company's chief negotiator, using a blackboard with figures, explained that employees earning $10.27 per hour under the current fixed hourly wage rate might be able to earn as much as $10.67 or $10.70 per hour under the new wage plan, because in addition to the proposed fixed hourly rate of $9.00 per hour, a supplemental amount would be earned under the new gain sharing and incentive pay plans, which would constitute an additional variable rate per hour depending on how much an employee earned under these plans. The Union objected to the Company's proposal, stating that it wanted a higher fixed hourly rate than the proposed $9.00 per hour instead of the gain sharing and incentive pay plans in case a recession caused building activity to slacken, which would result in employees working for no more than the reduced rate of $9.00 per hour, which was a $1.27 per hour reduction from the current wage rate of $10.27 per hour under the CBA that was going to expire on January 31, 1988.

On February 10, 1988, in its final pre-impasse proposal, the Company proposed to reduce the current fixed hourly wage rate of $10.27 per hour to $9.50 per hour (instead of the $9.00 per hour offered in prior proposals) in conjunction with implementing the gain sharing and incentive pay plans and a retirement savings plan. The Company also proposed a Company-sponsored health insurance plan, which was a change from the Choice Care plan provided under the expired agreement. The Union rejected this final offer, and impasse was reached on February 10, 1988. On March 7, 1988, the Company implemented its final offer and notified the employees of this by memorandum. The fixed hourly wage rate was reduced from $10.27 per hour under the expired agreement to $9.50 per hour and the new gain sharing and incentive pay plans were implemented as the Company had proposed in its final pre-impasse offer on February 10, 1988. The Choice Care Health Plan was terminated and the Company implemented the proposed Company-sponsored health plan.

The parties met on two additional occasions in 1988 in an effort to reach a collective bargaining agreement at which times the Company offered to agree to additional benefits consisting of improvements in the medical insurance plan, the institution of a prescription drug card, and improvements in holiday pay. The Union rejected all of these proposals.

Approximately a year after the previous negotiations, on April 21, 1989, the parties met for further negotiations. The Union members expressed dissatisfaction with the wage plan which had been implemented on March 7, 1988 (i.e., the reduced fixed hourly wage rate of $9.50 per hour in conjunction with gain sharing and incentive pay), indicating that they preferred a higher fixed hourly wage rate, because Union members preferred to know exactly what their earnings would be under a higher fixed hourly rate rather than the variable amount of total wages that resulted from the reduced rate of $9.50 per hour supplemented with variable earnings from gain sharing and incentive pay.

At the meeting of April 21, 1989, the Company made a final offer proposing to increase the then-existing hourly wage rate of $9.50 per hour, which had been implemented in conjunction with the gain sharing and incentive pay plans on March 7, 1988 after bargaining to impasse the year before. The proposed increase for drivers with more than two years of service was from $9.50 to $9.75 per hour effective May 1, 1989, increasing to $10.00 per hour effective September 1, 1989, and to $10.25 per hour effective January 1, 1990.

The Company proposed to increase the existing fixed hourly wage rate "in lieu of" the gain sharing and incentive pay plans, which it proposed to drop on April 30, 1989. The increase in the fixed hourly wage rate was offered by the Company in conjunction with the proposal to eliminate the gain sharing and incentive pay plans, which had first been implemented on March 7, 1988 to compensate for the loss in wages due to the reduction in the fixed hourly rate from $10.27 to $9.50 per hour. The Union inquired whether the Company would pay the accumulated gain sharing on a pro-rata basis on April 30, 1989. ⁵

At the April 21, 1989 meeting, the Company also proposed additional employee costs and plan limitations in its self-insured health care plan detrimental to the employees. In addition, the Company offered numerous improvements to the health plan beneficial to the employees. The Union insisted on the adoption of the Teamster health plan, but the Company rejected that proposal and insisted on continuing a self-administered plan.

The Union rejected the Company's final offer given at the April 21, 1989 meeting and impasse was reached. On April 24, 1989, the Company distributed a memorandum to its employees, informing them of the terms of its April 21, 1989 final offer. It stated that the Union's "primary concerns" were "a fixed wage increase in lieu of gain sharing and incentive pay" (emphasis added). The memorandum stated that the Company's final offer...