Rivera-Vega v. ConAgra, Inc.

• Citation: 70 F.3d 153
• Decision Date: 31 July 1995
• Docket Number: No. 95-1266,RIVERA-VEGA,95-1266
• Parties: 150 L.R.R.M. (BNA) 2902, 64 USLW 2384, 131 Lab.Cas. P 11,467 Efrain, et al., Plaintiffs-Appellees, v. CONAGRA, INC., et al., Defendants-Appellants. . Heard
• Court: United States Courts of Appeals. United States Court of Appeals (1st Circuit)

Page 153

70 F.3d 153

150 L.R.R.M. (BNA) 2902, 64 USLW 2384,

131 Lab.Cas. P 11,467

Efrain RIVERA-VEGA, et al., Plaintiffs-Appellees, v. CONAGRA, INC., et al., Defendants-Appellants.

No. 95-1266.

United States Court of Appeals,

First Circuit.

Heard July 31, 1995.

Decided Nov. 21, 1995.

Roger J. Miller, with whom McGrath, North, Mullin & Kratz, P.C., Omaha, NE, Angel Munoz-Noya and Lespier & Munoz-Noya, San Juan, PR, were on brief for appellants.

Robert Tendrich, Attorney, National Labor Relations Board, with whom Frederick L. Feinstein, General Counsel, Mary Joyce Carlson, Deputy General Counsel, Barry J. Kearney, Acting Associate General Counsel, Ellen A. Farrell, Assistant General Counsel, and Corinna L. Metcalf, Deputy Assistant General Counsel, National Labor Relations Board, Washington, DC, were on brief for appellees.

Before TORRUELLA, Chief Judge, BOUDIN and STAHL, Circuit Judges.

TORRUELLA, Chief Judge.

The respondent companies appeal an Order of the district court granting temporary injunctive relief to the Regional Director of the National Labor Relations Board under Sec. 10(j) of the National Labor Relations Act. The district court found reasonable cause to believe that the respondents violated their duty to bargain in good faith by refusing to provide the bargaining representative of its employees with requested financial documents. Based substantially on this violation, the district court issued a preliminary injunction. Finding neither clear error nor abuse of discretion, we affirm.

I. BACKGROUND

Molinos de Puerto Rico, Inc. ("MPR") is a wholly owned subsidiary of ConAgra, Inc. (collectively, the "respondents"). ¹ MPR maintains three production facilities in Puerto Rico where it mills, sells and distributes wheat, corn flour, and animal feed. In June 1993, Congreso de Uniones Industriales de Puerto Rico ("the union") and the respondents began negotiations for a new collective bargaining agreement, covering unit employees at MPR, to replace an existing agreement, which was nearing expiration. The parties soon became involved in a dispute over wages and benefits--respondents wanted to cut them, and the union sought increases. On several occasions, the union requested MPR's audited financial statements for the past five years to evaluate respondent's bargaining position. Respondents repeatedly refused to provide the requested information, and after four months of bargaining and 18 bargaining sessions, declared an impasse on October 28, 1993. On October 29, respondents informed the union that forty employees would be laid off on November 1st. On November 1st, respondents locked out employees reporting to work at MPR. Respondents subsequently hired replacement workers and continued operations. ²

The union filed an unfair labor practice charge with the National Labor Relations Board (the "NLRB"). The NLRB issued an unfair labor practice complaint on March 25, 1994, which charged that the respondents, as joint employers, violated Secs. 8(a)(1), (3) and (5) of the National Labor Relations Act (the "NLRA"), 29 U.S.C. Secs. 158(a)(1), (3), and (5), by, inter alia, failing to bargain in good faith when it refused to provide the union with the requested financial information, unilaterally changing the terms and conditions of employment before impasse was reached, unlawfully laying off 40 employees, and imposing a lockout and replacing employees with temporary employees to compel acceptance of its bargaining position. An administrative law judge ("ALJ") conducted a hearing on the matter from May 9 to 13, 1994. ³ On June 10, 1994, the NLRB petitioned the district court for a temporary injunction pursuant to section 10(j) of the NLRA, 29 U.S.C. Sec. 160(j).

After a hearing, the district court issued a comprehensive and detailed opinion in which it found reasonable cause to believe, inter alia, that: (1) respondents violated Secs. 8(a)(1) and (5) by refusing to provide the requested financial information to the union; (2) the refusal to furnish the financial statements precluded valid impasse; (3) respondents violated Sec. 8(a)(5) by making unilateral changes in the terms and conditions of employment when no valid impasse existed; and (4) respondents violated Secs. 8(a)(3) and (1) by locking out employees, and using replacements, in furtherance of its tainted bargaining position. The court further concluded that the standards for issuance of a preliminary injunction were met, and that such relief was just and proper to preserve the NLRB's ability to provide meaningful relief in the underlying unfair labor practice action. Finally, the court found reasonable cause to believe that MPR and ConAgra, Inc., are The district court issued a temporary injunction, pending a final resolution by the NLRB of the unfair labor practice action, directing the employer, upon request, to: (1) meet and bargain with the union; (2) restore working conditions which existed prior to October 28, 1993, and maintain them until the parties bargain in good faith to an agreement or an impasse on the changes; (3) provide the union with all requested information necessary and relevant for collective bargaining; and (4) reinstate locked out or terminated employees. Respondents' motion for a stay pending appeal was denied by the district court on March 6, 1995, and subsequently by this court on March 20, 1995.

joint employers for the purposes of labor relations.

II. STANDARD OF REVIEW

Section 10(j) of the NLRA authorizes the NLRB to seek, and the United States district courts to grant, interim relief pending the NLRB's resolution of unfair labor practices. See 29 U.S.C. Sec. 160(j). ⁴ In considering a petition for interim relief under Sec. 10(j), a district court must limit its inquiry to (1) whether the NLRB has shown "reasonable cause" to believe that the employer has committed the unfair labor practices alleged, and (2) whether injunctive relief is "just and proper." See Pye on Behalf of N.L.R.B. v. Sullivan Bros. Printers, Inc., 38 F.3d 58, 63 (1st Cir.1994) (collecting cases). In determining whether the NLRB has shown reasonable cause, the district court does not decide whether an unfair labor practice actually occurred; rather, its role is limited to determining only whether the NLRB's position is "fairly supported by the evidence." Id. (quoting Asseo v. Centro Medico Del Turabo, 900 F.2d 445, 450 (1st Cir.1990)). The district court does not resolve contested issues of fact, deferring instead to the NLRB's version of the facts if they are "within the range of rationality." Maram v. Universidad Interamericana de Puerto Rico, Inc., 722 F.2d 953, 958 (1st Cir.1983). We review the district court's conclusion that reasonable cause exists only for clear error, and examine its decision to grant equitable relief only for abuse of discretion. Sullivan Bros., 38 F.3d at 63; Centro Medico Del Turabo, 900 F.2d at 450.

III. DISCUSSION

A. Duty to Disclose Financial Information

Sections 8(a)(5) and (d) of the NLRA make it an unfair labor practice for an employer to refuse to bargain in good faith with its employees' representative. 29 U.S.C. Sec. 158(a)(5), (d). One element of the duty to bargain in good faith is that the employer must, upon request, supply relevant information needed by the union "for the proper performance of its duties as the employees' bargaining representative." Detroit Edison Co. v. NLRB, 440 U.S. 301, 303, 99 S.Ct. 1123, 1125, 59 L.Ed.2d 333 (1979); NLRB v. Acme Indus., 385 U.S. 432, 435-36, 87 S.Ct. 565, 567-68, 17 L.Ed.2d 495 (1967); Soule Glass and Glazing Co. v. NLRB, 652 F.2d 1055, 1092 (1st Cir.1981). The purpose of this rule is to "enable the [union] to understand and intelligently discuss the issues raised in bargaining." Soule Glass, 652 F.2d at 1092 (quoting San Diego Newspaper Guild v. NLRB, 548 F.2d 863, 866 (9th Cir.1977)). Information relating to wages, hours, and other terms and conditions of employment is presumptively relevant and necessary for the union to perform its obligations. Teleprompter Corp. v. NLRB, 570 F.2d 4, 8 (1st Cir.1977); F.A. Bartlett Tree Expert Co., Inc., 1995 WL 238413, * 2 (NLRB).

No such presumption exists with respect to financial data. Because of the Good faith bargaining necessarily requires that claims made by either bargainer should be honest claims. This is true about an asserted inability to pay an increase in wages. If such an argument is important enough to present in the give and take of bargaining, it is important enough to require some sort of proof of its accuracy.

                sensitive nature of a company's financial data, the general rule is that such information need not be disclosed unless the bargaining representative first makes a showing that "it is specially relevant to the bargaining taking place."  Teleprompter Corp., 570 F.2d at 8 (citing Int'l Woodworkers v. NLRB, 263 F.2d 483 (D.C.Cir.1959) (Burger, J.)).  If the employer itself puts profitability into issue by claiming an inability to pay an increase in wages, however, then the financial information is presumptively relevant to the bargaining process, and the employer is required to substantiate its economic condition.  NLRB v. Truitt Mfg. Co., 351 U.S. 149, 152-53, 76 S.Ct. 753, 755-56, 100 L.Ed. 1027 (1956);  Teleprompter Corp., 570 F.2d at 7.   The Supreme Court has explained the rationale for this rule as follows
                

Truitt Mfg., 351 U.S. at 152-53, 76 S.Ct. at 755-56. ⁵

Circuit courts interpreting Truitt have long distinguished between cases in which an employer claims an inability to pay the requested wage increase and those in which the employer maintains that complying with the union's request would place it at a competitive disadvantage, ordering disclosure in the former but denying it in the latter. See, e.g., NLRB v. Harvstone Mfg. Corp., 785 F.2d 570, 575-79 (7th Cir.), cert. denied, 479 U.S. 821, 107 S.Ct. 88, 93 L.Ed.2d 41 (1986); Buffalo Concrete, 276 N.L.R.B. 839, 1985 WL 46320 (1985), enfd...