N.L.R.B. v. Max Factor and Co.

• Citation: 640 F.2d 197
• Decision Date: 18 May 1981
• Docket Number: No. 79-7118,79-7118
• Parties: 105 L.R.R.M. (BNA) 2765, 89 Lab.Cas. P 12,232 NATIONAL LABOR RELATIONS BOARD, Petitioner, v. MAX FACTOR AND COMPANY, Respondent, v. Luisa GRATZ, Intervenor.
• Court: United States Courts of Appeals. United States Court of Appeals (9th Circuit)

Page 197

640 F.2d 197

105 L.R.R.M. (BNA) 2765, 89 Lab.Cas. P 12,232

NATIONAL LABOR RELATIONS BOARD, Petitioner, v. MAX FACTOR AND COMPANY, Respondent, v. Luisa GRATZ, Intervenor.

No. 79-7118.

United States Court of Appeals, Ninth Circuit.

Argued and Submitted June 2, 1980.

Decided Sept. 9, 1980.

Rehearing Denied Oct. 24, 1980.

Certiorari Denied May 18, 1981.

See 101 S.Ct. 2314.

Sandra K. Williams, Washington, D. C., argued, Elliott Moore, Washington, D. C., on brief, for petitioner.

Elizabeth B. Spector, for intervenor and appellant.

Stuart R. Korshak, Los Angeles, Cal., argued and on brief, for respondent.

Petition to Enforce Order of National Labor Relations Board.

Before GOODWIN and PREGERSON, Circuit Judges, and SCHWARZER, ^* District Judge.

WILLIAM W SCHWARZER, District Judge:

The National Labor Relations Board and Intervenor Luisa Gratz petition under 29 U.S.C. Section 160(e) for enforcement of the Board's order against Max Factor and Co. ("Factor"). The controversy arose out of Factor's discharge of Gratz, who then filed unfair labor practice charges under Sections 8(a)(1) and (3) of the National Labor Relations Act ("the Act"), 29 U.S.C. § 158(a) (1) and (3). Shortly thereafter the union grieved the discharge under the collective bargaining agreement and took it to arbitration. After a hearing on the unfair labor practice charges, an administrative law judge ("ALJ") found that Factor had violated the Act and ordered reinstatement. While the ALJ's decision was pending before the Board on exceptions, the arbitrator, after hearing, issued his decision sustaining the discharge as having been for good cause. Factor's subsequent request to the Board to defer to the arbitrator's decision was rejected by the Board which adopted the ALJ's decision. ¹ We grant enforcement.

I. Facts

Gratz was chief union steward at Factor's Los Angeles plant until February 3, 1977. In course of efforts to process a large backlog of grievances, an unsatisfactory relationship developed between Gratz and Factor's director of industrial relations, Bill Piercy, and personnel manager, James Bryant. Gratz was given disciplinary warnings on December 9 and 27, 1976, suspended on December 27, and discharged February 3, 1977. The ALJ found that during October or November, 1976, Bryant and Piercy called Gratz into Bryant's office to tell her they felt she was spending too much time on union business and not enough time on production work. He accepted Gratz's testimony that during the conversation they suggested that she consider taking a management position with Factor or returning to law school at Factor's expense and giving up her job as chief steward. He concluded that this was an offer of economic benefits for giving up a union office, a violation of Section 8(a)(1). The ALJ also found that Factor's disciplinary warnings to Gratz on December 9 and 27, 1976, ostensibly for spending too little time on production work, were motivated by Gratz's devotion and energy on behalf of the union as chief steward. When Bryant gave her the December 27 warning, Gratz responded angrily, accusing him of "kissing the ass" of a Factor vice president and calling Bryant "a big phoney" and "a little twerp." Factor then suspended her for the stated reason that she had violated plant rules by using profane and abusive language. The ALJ found that Gratz's conduct occurred in the course of her duties as chief steward and in response to an unlawful disciplinary warning, and was not so flagrant, violent, or serious as to forfeit the protection of Sections 8(a)(3) and (1) of the Act. He concluded that Gratz's subsequent discharge on February 3, 1977, following another incident with Bryant was motivated by her pursuit of protected activities as chief steward, and rejected as pretextual the reasons offered by Factor: insufficient production work, use of abusive language, and insubordination.

The ALJ made specific findings of fact to support his conclusion that Factor's actions were motivated by a purpose forbidden by Sections 8(a)(1) and (3). The most significant findings were that Factor's management was concerned about the large backlog of pending employee grievances and disapproved of Gratz's manner of handling the grievances as chief steward. He found that Piercy felt Gratz had failed to compromise pending grievances or to discourage the filing of unfounded and duplicative grievances, and that Bryant had repeatedly complained that Gratz was too "pushy" and "aggressive" and had a "bad attitude" and that he twice said he would "get" her for actions she took as chief steward. The ALJ supported his finding that Factor's reliance on Gratz's low production work hours was pretextual by findings that other chief stewards had not been subject to the same demands. Inasmuch as the deferral issue was not raised before the ALJ, he made no findings on it.

On January 3, 1978, 23 days after the ALJ's decision, the arbitrator issued his opinion and award. There is no indication that evidence regarding the October or November, 1976 meeting was presented to him, but he discussed the events of December, 1976, through February, 1977, at length. He found that the suspension and discharge were for just cause and accepted Factor's stated reasons as valid. He found that Gratz spent much less than 50 percent of her time on production work. Based on the testimony of other chief stewards that they spent more than 50 percent of their time on production work, the arbitrator rejected the union's defense that the production work requirement was not "fair." The arbitrator's opinion does not discuss this "defense" in terms of statutory rights, but notes only that unfair labor practice charges were filed with the Board. No statutory provisions, court cases, or Board decisions are cited. The arbitrator also sustained Factor's other stated reasons for suspending and discharging Gratz. He found that the various instances of conflict between Gratz and Bryant were caused by her unwarranted attitude that as chief steward she was "equal to or above the management people she had to deal with." (R 94-95, 97-98, 100, 103). Regarding Gratz's abusive language toward Bryant, the arbitrator found that such conduct was not "incidental to the carrying out of the official duties of a Union representative" and created just cause for disciplinary action. (R 97, 104).

II. Deferral to Arbitration

This case again confronts the court with the troublesome issue of whether, and under what circumstances, the Board's refusal to defer to an arbitrator's decision should be upheld. Resolution of that issue requires accommodation of two important policies which are in tension: the policy favoring the exercise of jurisdiction by the Board to prevent unfair labor practices ² and the policy favoring the "settling of labor disputes by arbitration." United Steelworkers of America v. Enterprise, Wheel & Car Corp., 363 U.S. 593, 596, 80 S.Ct. 1358, 1360, 4 L.Ed.2d 1424 (1960); United Steelworkers of America v. Warrior & Gulf Navigation Co., 363 U.S. 574, 578, 80 S.Ct. 1347, 1350, 4 L.Ed.2d 1409 (1960); Gateway Goal Co. v. United Mine Workers of America, 414 U.S. 368, 377-79, 94 S.Ct. 629, 636-637, 38 L.Ed.2d 583 (1974). ³

The task of making that accommodation in any particular case is, in the first instance, the Board's, and to that end it has wide discretion to decide whether to defer. Hawaiian Hauling Service, Ltd. v. NLRB, 545 F.2d 674, 676 (9th Cir. 1976), cert. denied, 431 U.S. 965, 97 S.Ct. 2921, 53 L.Ed.2d 1061 (1977). In that case we said that:

The Board has established criteria to guide its decision and to this extent self-imposed restraints limit its discretion. In reviewing the Board, we must insure that it adheres to its own standards until they are properly changed by the Board. We will not deny enforcement unless the Board clearly departs from its own standards or its standards are themselves invalid. (Id.)

See also Stephenson v. NLRB, 550 F.2d 535, 537 (9th Cir. 1977); Alfred M. Lewis, Inc. v. NLRB, 587 F.2d 403, 407 (9th Cir. 1978); NLRB v. Pincus Brothers, Inc.-Maxwell, 620 F.2d 367 (3rd Cir. 1980); Local 700, Int. Assn. Mach. & Aero Workers v. NLRB, 525 F.2d 237, 239 (2nd Cir. 1975); cf. Carey v. Westinghouse Corp., 375 U.S. 261, 270-71, 84 S.Ct. 401, 408, 11 L.Ed.2d 320 (1964); William E. Arnold Co. v. Carpenters District Council, 417 U.S. 12, 16-17, 94 S.Ct. 2069, 2072, 40 L.Ed.2d 620 (1974).

The fountainhead of the deferral policy is Spielberg Manufacturing Co., 112 NLRB 1080 (1955), in which the Board announced that it would defer to an existing arbitration award (upholding employee discharges) and dismiss an unfair labor practice charge where (1) the arbitration proceeding appeared to have been fair and regular, (2) all parties agreed to be bound, and (3) the arbitrator's decision was not "clearly repugnant to the purposes and policies of the Act." See also, International Harvester Co., 138 NLRB 923 enforced sub nom., Ramsey v. NLRB, 327 F.2d 784 (7th Cir.), cert. denied, 377 U.S. 1003, 84 S.Ct. 1938, 12 L.Ed.2d 1052 (also a discharge case).

Subsequently the Board extended that policy to cases involving disputes subject to arbitration under a collective bargaining agreement but not yet submitted to arbitration. Collyer Insulated Wire, 192 NLRB 837 (1971). See, e. g., NLRB v. Safeway Stores, 622 F.2d 425 (9th Cir., 1980). Although a majority of the Board has rejected the Collyer policy of deferral to prospective arbitration, at least as applied to individual rights cases under Sections 8(a)(1) and (3), see General American Transportation Company, 228 NLRB 808 (1977), the Spielberg policy appears to remain in effect. ⁴

The Board here gave three reasons for its decision not to defer to the arbitrator's award:

(1) "that deferral to the arbitration award herein would engender a result repugnant to the purposes and policies of the Act";

(2) that, because "(t)he arbitrator did not pass on...