N.L.R.B. v. Mar-Len Cabinets, Inc.

• Decision Date: 25 November 1981
• Docket Number: No. 79-7453,MAR-LEN,79-7453
• Citation: 659 F.2d 995
• Parties: 108 L.R.R.M. (BNA) 2838, 92 Lab.Cas. P 13,062 NATIONAL LABOR RELATIONS BOARD, Petitioner, v.CABINETS, INC., Respondent.
• Court: U.S. Court of Appeals — Ninth Circuit

Page 995

659 F.2d 995

108 L.R.R.M. (BNA) 2838, 92 Lab.Cas. P 13,062

NATIONAL LABOR RELATIONS BOARD, Petitioner, v. MAR-LEN CABINETS, INC., Respondent.

No. 79-7453.

United States Court of Appeals, Ninth Circuit.

Argued and Submitted Aug. 8, 1980.

Decided Oct. 19, 1981.

Rehearing Denied Nov. 25, 1981.

Ruah Lahey, Washington, D. C., for petitioner.

Stephen J. Schultz, Merrill & Atkinson, San Diego, Cal., for respondent.

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

Before BROWNING, Chief Judge, ALARCON, Circuit Judge, and HAUK, ^* District Judge.

PER CURIAM:

Prior to 1977, respondent Mar-Len Cabinets, Inc. was a non-party signatory to two master collective bargaining agreements between the United Brotherhood of Carpenters and Joiners of America and two employer associations, the first covering employees installing cabinets at various construction jobsites (the "outside agreement"), and the second covering employees manufacturing cabinets at respondent's shop (the "inside agreement").

When the master agreements expired, respondent sought to negotiate separate more favorable agreements with the union. The negotiations broke down. The union brought an unfair labor practice charge alleging respondent had violated § 8(a)(1) & (5) of the National Labor Relations Act, 29 U.S.C. § 158(a)(1) & (5), by instituting unilateral changes in the wages and working conditions of outside employees without first complying with the notice requirements of Section 8(d) of the Act, and by bargaining in bad faith with respect to a new inside agreement.

The National Labor Relations Board found in favor of the union, and now seeks enforcement of its order. We deny enforcement to the extent the order is based on a finding that respondent violated the notice provisions of the Act, but enforce it in other respects.

I. THE OUTSIDE AGREEMENT

The agreement between respondent and the union provided that a party desiring to change or cancel the agreement must give written notice to the other 60 days before the agreement expired. By letter dated March 4, 1977 Respondent informed the Union that it did not wish to continue to be bound by the master outside agreement, due to expire June 15, 1977. No notice was sent to state or Federal mediation services. No negotiations followed.

On March 22, 1977, the union notified the employer association parties to the master outside agreement that it wished to reopen the agreement. Copies of this notice were sent to state and Federal mediation services. A new master agreement was negotiated between the union and the employer associations. Respondent did not participate in these negotiations.

The union subsequently informed respondent that it considered respondent bound by the newly negotiated master agreement. The union took the position that respondent's March 4th notice was ineffective because respondent had not notified the mediation services. Respondent told the union it did not consider itself bound by the new master agreement and sought to initiate negotiations for a separate agreement. The union refused to negotiate.

On August 8, 1977, respondent notified state and Federal mediation services that a labor dispute existed. On August 19, 1977, respondent unilaterally adopted its proposed contract changes, raising the wages of its outside employees and abolishing union security.

The Board found respondent had violated its duty to bargain collectively under Section 8(a)(5), 29 U.S.C. § 158(a)(5), by terminating the agreement without continuing its terms for 60 days after notifying the mediation services of the dispute, as required by Section 8(d), 29 U.S.C. § 158(d). ¹

Respondent challenges the Board's order on four grounds.

1. Respondent contends it was not required to wait 60 days after giving the 8(d)(3) notice before implementing its bargaining proposals because the waiting period is required only before a strike or lockout. Section 8(d)(4) provides that the party desiring to modify the contract continue "in full force and effect ... all the terms and conditions of the existing contract ..." until the waiting period has passed. 29 U.S.C. § 158(d)(4). This wording plainly prohibits a unilateral departure from the terms of the contract whether or not a strike or lockout follows, as the Senate Committee report on § 8(d) confirms: "Should the notice not be given on time ... it becomes an unfair labor practice for an employer to change any of the terms or conditions specified in the contract for 60 days or to lock out his employees. Similarly, it is an unfair labor practice by a union to strike before the expiration of the 60-day period." S.Rep. No. 105, 80th Cong., 1st Sess. 24 (1947) (emphasis added), reprinted in 1 NLRB, Legislative History of the Labor Management Relations Act, 1947, 407, 430 (1948).

2. Respondent asserts the union's absolute refusal to bargain on the outside agreement relieved respondent of any obligation to bargain collectively, including any duty to notify the mediation services.

Respondent relies upon the dictum in Times Publishing Co., 72 NLRB 676, 683 (1947) that "a union's refusal to bargain in good faith may remove the possibility of negotiation and thus preclude the existence of a situation in which the employer's own good faith can be tested." The notice provision is not concerned with "good faith;" it is designed to give the mediation services time to intervene before disruptive economic action is taken by one of the parties. Amax Coal Co. v. NLRB, 614 F.2d 872, 889 (3d Cir. 1980). This purpose would be hindered, not served, if the duty to give notice disappeared when the non-initiating party refused to bargain. It is in just such a case that the need for mediation may be most pressing.

3. Respondent contends that by rejecting its cancellation notice the union became the "initiating party," and thus bore the burden of giving notice. Section 8(d) provides that "no party to (a collective-bargaining) contract shall terminate or modify such contract, unless the party desiring such termination or modification ... (3) notifies the Federal Mediation and Conciliation Service ...." 29 U.S.C. § 158(d) & (d)(3). This language places the burden of notifying the agencies on the first party seeking to terminate or modify the contractual arrangement. United Furniture Workers of America v. NLRB, 336 F.2d 738, 741 (D.C.Cir.1964). The union's refusal to agree to the modification desired by respondent did not affect this obligation. Respondent's contention, like the argument rejected in United Furniture Workers, is to the:

effect that the burden shifts in accordance with the twistings and turnings of the bargaining negotiations. Such a construction seems to us, however, to be fraught in the highest degree with the peril that the public interest in the emollient intervention of the mediation services will fall between the two stools of contending parties wholly intent upon the uncertain and frequently fluctuating fortunes of their negotiating positions. It is a peril which can be avoided by assigning a fixed and definite responsibility for notifying the public agencies. Congress has made that assignment and, not surprisingly, it is to the party who starts the process.

4. Finally, respondent argues it was relieved of its duty to notify the services because the union had already notified them. The Board's response is that the initiating party's duty to mail the required notices is absolute and can not be shifted.

The cases cited by the Board are not in point. They hold only that the initiating party must bear the adverse consequences if no notice is given, or the notice given is untimely. No court has held that the initiating party must send a second notice when the non-initiating party has already notified the mediation agencies.

Congress' principle concern in enacting Section 8(d) was to give the mediation services time to intervene in an effective manner. This goal would not be advanced by requiring the initiating party to give notice after the other party had done so.

The initiating party remains at risk, however, if the notice sent by the other party was ineffective to apprise the mediation services of the particular dispute. Amax Coal Co. v. NLRB, supra, 614 F.2d at 889. The Board did not reach this issue because it concluded that respondent's duty to notify could not be affected by any union notification. Therefore we will remand the case to the Board so it can rule on the effectiveness of the notification given to the mediation services by the union.

II. THE INSIDE AGREEMENT

A. Withdrawal of Recognition.

The Board found respondent violated Section 8(a)(5) and (1) by unlawfully withdrawing recognition from the union and thereafter refusing to bargain with the union.

The union enjoyed a rebuttable presumption of majority support, NLRB v. Tahoe Nugget, Inc., 584 F.2d 293, 297 (9th Cir. 1978), and respondent's withdrawal of recognition established a prima facie case of unlawful refusal to bargain. NLRB v. Top Manufacturing Co., 594 F.2d 223, 224 (9th Cir. 1979). Respondent could rebut this presumption by showing either that the union had in fact lost its majority status or that its withdrawal of recognition was based upon a good faith doubt of the union's continued majority status. Ibid. The Board found respondent did not meet its burden.

Respondent points out that none of the employees joined in the picket line established by the union and that four of the six inside employees resigned from the union and returned to work. In addition, some employees expressed dissatisfaction with the union's failure to report bargaining developments and to respond to questions about the consequences of working behind the picket line. However, there was sufficient evidence supporting the Board's conclusions that the employees resigned from the union to avoid potential fines, not to oust the union as a bargaining representative, and that they crossed the...