Peters v. N.L.R.B.
| Decision Date | 10 August 1998 |
| Docket Number | U,No. 459,96-6179 and 96-6184,Nos. 96-6049,459,s. 96-6049 |
| Parties | 158 L.R.R.M. (BNA) 3037, 135 Lab.Cas. P 10,216 Samuel L. PETERS, Receiver, and Specialty Envelope, Incorporated, Petitioners/Cross-Respondents, v. NATIONAL LABOR RELATIONS BOARD, Respondent/Cross Petitioner, United Paperworkers International Union, Localnited Paperworkers International Union, Intervenors. NATIONAL LABOR RELATIONS BOARD, Petitioner, v. WESTERN PAPER PRODUCTS, Incorporated, d/b/a Specialty Envelope Company, Respondent, United Paperworkers International Union, Localnited Paperworkers International Union, Intervenors. |
| Court | U.S. Court of Appeals — Sixth Circuit |
David K. Montgomery (argued and briefed), Paul D. Dorger, Keating, Muething & Klekamp, Cincinnati, Ohio, for Petitioners/Cross-Respondents.
Aileen A. Armstrong (briefed), Deputy Associate General Counsel, Julie B. Broido (argued and briefed), Margaret Ann Gaines Neigus (briefed), National Labor Relations Board, Appellate Court Branch, Washington, DC, for Respondent/Cross-Petitioner.
Peter M. Fox (briefed), Kircher, Robinson, Newman & Welch, Cincinnati, Ohio, for Intervenors.
Before: KENNEDY and SILER, Circuit Judges; COHN, District Judge. *
SILER, J., delivered the opinion of the opinion of the court, in which COHN, D.J., joined. KENNEDY, J. (p. 302), delivered a separate opinion concurring in part and dissenting in part.
Petitioners/cross-respondents, Samuel L. Peters and Specialty Envelope, Inc. ("New Specialty"), appeal the National Labor Relations Board's decision in favor of the respondent/cross-petitioner, National Labor Relations Board ("NLRB" or "the Board"), for various violations of the National Labor Relations Act ("NLRA" or "the Act"). The Board has cross petitioned for enforcement of the order. For the reasons set forth below, we ENFORCE in part, DENY in part, and REMAND for further proceedings consistent with this opinion.
In December 1990, Western Paper Products, Inc. ("Western"), doing business as Specialty Envelope Co., entered into a collective bargaining agreement with the representative of its employees, United Paper Workers International Union, AFL-CIO, Local 459 ("Union"). The agreement was to remain effective through November 20, 1993. In November 1991, however, Western, which had been financially troubled for quite some time, stopped making required contributions to various employee benefits plans.
By January 9, 1992, Western's financial problems had become so acute that its primary lender, Central Trust Company, called in its loan. This action forced Western to cease operations and lay off all bargaining unit employees. Western sent its employees home at midday on January, 9, 1992, with the warning that it could not even guarantee their paychecks. Central Trust also asked the Hamilton County, Ohio, Court of Common Pleas to appoint a receiver to manage Western's assets. On Monday, January, 13, 1992, the court appointed Central Trust's recommended receiver, Samuel Peters, and issued an order delineating his authority. Peters stipulated that he "assumed the responsibility of Receiver with the intention of attempting to purchase the Assets" of Western. Peters hired Samuel Venanzio as his general manager and set about his task of overseeing the day-to-day operation of Western. Neither Peters nor Venanzio had any prior association with Western.
That same day, Peters recalled the laid-off employees to Western's plant. He spoke directly to at least the first two shifts of employees. He did not speak to the third shift employees. He explained to the first shift that he would operate the company while it was in receivership, that he would deliver paychecks for their prior work, and that "the only thing that he was guaranteeing [each of them] at this point in time was a job." At his meeting with the second shift, Peters explained that the Union contract would be "null and void during the receivership." Knowledge of Peters's statement spread among the third shift the next day. Soon after Peters took over as receiver, he addressed the employees and described the benefits package they could expect if and when he purchased Western's assets. It is uncontested that Peters refused to honor the contract which the Union had with Western.
On June 19, 1992, the Court of Common Pleas approved the sale of Western's assets to New Specialty, a recently incorporated Ohio entity of which Peters was the sole shareholder. Shortly after the sale was approved, New Specialty solicited employment from the employees then working for Peters. On June 25, 1992, those employees who wished to seek employment received an application packet listing the terms for their new employment contracts. New Specialty gave no indication of whether it would hire any of the employees until after they had reviewed the packet. On September 8, 1992 New Specialty finalized its purchase of Western's assets from Peters, as receiver.
Between January and November 1992, the Union filed a series of unfair labor practices charges against Western, Peters, and New Specialty. Among other things, these charges asserted that the parties had violated sections 8(a)(5) & (1) of the Act, 29 U.S.C. §§ 158(a)(5) & (1), by refusing to recognize and bargain with the Union and refusing to furnish the Union with information that it had requested. The Board's Regional Director consolidated the charges and issued a fourth, and final, consolidated complaint on December 22, 1992. This complaint alleged that Western was the employer until June 25, 1992, and that Peters, as receiver, was Western's agent during that period. It also alleged that New Specialty purchased the assets of Western during the period of June 19, 1992, to September 8, 1992, but operated the business of Western "since about June 25, 1992."
In February 1993, the Board sought a preliminary injunction ordering New Specialty to bargain with the Union. The district court denied relief, but this court reversed on appeal and held that temporary injunctive relief was appropriate. See Frye v. Specialty Envelope, Inc., 10 F.3d 1221 (6th Cir.1993). Meanwhile, the complaint itself was being heard before an Administrative Law Judge ("ALJ"). At a March 1, 1993, hearing, the General Counsel moved to amend his fourth consolidated complaint to include allegations that Peters acted not only as the agent of Western, but "as an employer in his own right." The ALJ denied the General Counsel's motion.
The ALJ issued his first decision on June 22, 1993. All parties but Western filed exceptions. On November 23, 1993, the Board reversed the ALJ's denial of the General Counsel's motion to amend the complaint and remanded the case to the ALJ for further proceedings. The ALJ issued another decision on July 29, 1994, to which the Union, Peters, and New Specialty filed exceptions.
On July 26, 1996, the Board issued its Decision and Order, finding: (1) that the ALJ correctly found that Western violated § 8(a)(5) of the Act by failing to make contractually required payments to various employee benefits funds; (2) that Peters, acting as receiver, was an employer under § 2(2) of the Act; (3) that Peters was a successor to Western and, therefore, violated § 8(a)(5) by refusing to bargain with the Union; (4) that the ALJ correctly found that Peters was required to bargain with the Union before making changes to the terms of employment; (5) that Peters's unlawful conduct precluded him from relying on a February 1992 decertification petition to assert a good-faith doubt of the Union's majority status; (6) that the ALJ incorrectly decided that Peters was jointly and severally liable for remedying the unfair labor practices of Western; (7) that the receivership did not end until September 8, 1992 and that Peters's liability for unfair labor practices did not terminate until that date; (8) that New Specialty was a successor employer obligated to bargain with the Union; (9) that New Specialty, in contrast to Peters, was entitled to set unilaterally the initial terms of employment; (10) that New Specialty violated its duty to bargain with the Union when it unilaterally changed a disciplinary policy on July 21, 1992, and refused to furnish the Union with information it requested on July 31, 1992; and (11) that New Specialty was jointly and severally liable for remedying the unfair labor practices committed by Western and Peters.
The Board ordered New Specialty to: (1) recognize and bargain with the Union before making any changes to the terms of employment; (2) furnish the Union with information necessary and relevant to its role as collective-bargaining representative, including the information requested on July 31, 1992; and (3) on request of the Union, rescind the new disciplinary policy that it had implemented on July 21, 1992, until it had bargained in good faith with the Union.
Furthermore, New Specialty was ordered to reimburse its employees for costs associated with the violations. Specifically, New Specialty was to: (1) recall laid-off employees, restore the employees' health, disability and life insurance; (2) reimburse all delinquent contributions to the pension funds and (3) reimburse the employees for any expenses that they might have incurred as a result of the unlawful conduct of Western, Peters, or New Specialty. 1
Peters and New Specialty have petitioned this court for review of the Board's Decision and Order and the Board has filed a cross-petition for enforcement. Western has not petitioned this court for review.
This court reviews factual determinations of the NLRB under a "substantial evidence" standard. 29 U.S.C. § 160(f). See also NLRB v. Fluor Daniel, Inc., 102 F.3d 818, 836-37 (6th Cir.1996). That is, if the record viewed as a whole provides sufficient evidence for a reasonable factfinder to reach the conclusions...
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