Spectrum Health—kent Cmty. Campus v. Nat'l Labor Relations Bd.

• Decision Date: 05 August 2011
• Docket Number: Nos. 10–1260,10–1270.,s. 10–1260
• Citation: 191 L.R.R.M. (BNA) 2225,647 F.3d 341
• Parties: SPECTRUM HEALTH—KENT COMMUNITY CAMPUS, Petitionerv.NATIONAL LABOR RELATIONS BOARD, Respondent.
• Court: U.S. Court of Appeals — District of Columbia Circuit

647 F.3d 341

191 L.R.R.M. (BNA) 2225

SPECTRUM HEALTH—KENT COMMUNITY CAMPUS, Petitioner

v.NATIONAL LABOR RELATIONS BOARD, Respondent.

Nos. 10–1260

10–1270.

United States Court of Appeals, District of Columbia Circuit.

Argued April 18, 2011.Decided Aug. 5, 2011.

On Petition for Review and Cross–Application for Enforcement of An Order of the National Labor Relations Board.Peter J. Kok argued the cause for petitioner. With him on the briefs were Nathan D. Plantinga and Gregory P. Ripple.Richard A. Cohen, Senior Attorney, National Labor Relations Board, argued the cause for respondent. With him on the brief were John H. Ferguson, Associate General Counsel, Linda Dreeben, Deputy Associate General Counsel, and Fred B. Jacob, Deputy Assistant General Counsel.Before: HENDERSON, GARLAND, and GRIFFITH, Circuit Judges.Opinion for the Court filed by Circuit Judge GARLAND.GARLAND, Circuit Judge:

Spectrum Health—Kent Community Campus withdrew recognition from its employees' union after receiving a petition indicating that the union no longer had majority support. The National Labor Relations Board found this action unlawful because it occurred within the first three years of the parties' collective bargaining agreement, during which time a union enjoys a conclusive presumption of majority support. Spectrum argues that the term of the collective bargaining agreement began more than three years before it withdrew recognition, and that the conclusive presumption had therefore lapsed. Spectrum also objects to the Board's imposition of an affirmative bargaining order.

We conclude that the Board properly interpreted the term of the collective bargaining agreement, and that Spectrum waived its objections to the bargaining order by failing to raise them in a timely manner before the Board. Accordingly, we deny Spectrum's petition for review and grant the Board's cross-application for enforcement.

I

Spectrum operates a hospital in Grand Rapids, Michigan. In late 1999, the International Union, United Automobile, Aerospace, and Agricultural Implement Workers of America (UAW), and its Local 2600, became the exclusive bargaining representative for a sizeable unit of Spectrum's employees. In November 2004, Spectrum and the union began to negotiate a successor to a 2002 collective bargaining agreement set to expire on December 31, 2004. During the course of negotiations, the parties extended the 2002 agreement to January 15, 2005, but did not agree on a second extension. As a consequence, the agreement expired on that date. It was not until late March 2005 that the parties reached a tentative agreement on a new collective bargaining agreement. The union's members ratified that agreement on April 13, and it was executed two days later, on April 15, 2005.

The following statement was written at the bottom of the cover of the 2005 agreement: “DATE OF AGREEMENT: JANUARY 1, 2005 THROUGH MARCH 31, 2008.” Agreement Between Spectrum & Local 2600, UAW (J.A. 272) [hereinafter CBA]. However, the first paragraph of the document, under the heading “AGREEMENT,” stated: “This is an Agreement by and between [Spectrum and the union], effective April 13, 2005.” CBA para. 1. The final section of the contract, under the heading “TERMINATION,” stated: “This Agreement shall remain in force until 12:01 a.m., April 1, 2008.” Id. § 77. Among other provisions, the agreement provided for annual wage increases for both “future hires” and “incumbent employees.” Future hires, defined as those hired on or after April 13, 2005, were to receive wage reclassifications “[e]ffective with the first payroll periods beginning after April 13, 2005, April 13, 2006, and April 13, 2007.” Id. § 69(a)(i). Incumbent employees, defined as those hired on or prior to April 12, 2005, were to receive an initial 4.5 percent raise “[d]uring the first year of the contract, ... retroactive to January 1, 2005,” and additional raises “[a]t the beginning of the second and third contract years.” Id. § 69(a)(ii). The agreement contained two other provisions, relating to changes in Spectrum's retirement and health plans, that were also specifically made retroactive to January 1, 2005.¹

On January 7, 2008, Spectrum withdrew recognition from the union based upon its receipt of a petition, signed by a majority of the bargaining unit employees, stating that they no longer wanted to be represented by the union. The next day, Spectrum announced to employees that the UAW contract was no longer in effect. Top Spectrum officials began a series of meetings with employees in which they announced that recognition of the union had been withdrawn due to a loss of majority support and that the company was considering annual spring wage and benefit adjustments. In late February, Spectrum posted a notice of “Town Hall Meetings” to be held on March 3 and March 7, promising “Exciting News for Former UAW Staff.” At those meetings and in subsequent mailings to employees, the company announced a series of wage and benefit improvements, effective March 2, and suggested that further wage adjustments would occur in October 2008. The company also denied a grievance filed under the collective bargaining agreement, taking the position that grievances would instead be handled under Spectrum's non-bargained “fair treatment” policy.

In response to these actions, the union filed an unfair labor practice charge against Spectrum, and the General Counsel of the National Labor Relations Board (NLRB) subsequently issued a complaint. On September 4, 2008, an Administrative Law Judge (ALJ) found that Spectrum had violated sections 8(a)(1) and 8(a)(5) of the National Labor Relations Act (NLRA).²

As Spectrum acknowledges, under longstanding NLRB precedent a union enjoys “a conclusive presumption of majority status during the term of any collective-bargaining agreement, up to three years.” Auciello Iron Works, Inc. v. NLRB, 517 U.S. 781, 786, 116 S.Ct. 1754, 135 L.Ed.2d 64 (1996); see Raymond F. Kravis Ctr. for the Performing Arts, Inc. v. NLRB, 550 F.3d 1183, 1188 (D.C.Cir.2008); Shaw's Supermarkets, 350 N.L.R.B. 585, 587–88 (2007); Spectrum Br. 13, 15. “This conclusive presumption ... arises not from an absolute certainty that the union continues to enjoy majority status, but from the National Labor Relations Act's purpose of fostering industrial peace by promoting stable collective bargaining relationships.” McDonald Partners, Inc. v. NLRB, 331 F.3d 1002, 1005–06 (D.C.Cir.2003) (citing Auciello, 517 U.S. at 785–90, 116 S.Ct. 1754). The Board has clarified that this irrebuttable presumption becomes rebuttable after the agreement expires or after the third year of an agreement of longer duration. Shaw's Supermarkets, 350 N.L.R.B. at 587–88. At that point, an employer may withdraw recognition if it has untainted evidence of a union's actual loss of majority support. Id.; see Raymond F. Kravis, 550 F.3d at 1189 n. 1.

It is undisputed that the petition Spectrum received would have constituted sufficient evidence to rebut the presumption if the three-year period had passed. Thus, as the ALJ recognized and Spectrum agreed, Spectrum's liability depends entirely on whether the term of the 2005 agreement began more or less than three years before January 7, 2008, the date of the employer's withdrawal. See Spectrum Health—Kent Community Campus, 353 N.L.R.B. No. 99, at 5 (Feb. 26, 2009) (ALJ Op.); Spectrum Br. 13, 15. Spectrum argued that the term began on January 1, 2005, the date inscribed on the cover of the agreement. The General Counsel maintained that it began on April 13, 2005, the effective date listed in the agreement's first paragraph.

The ALJ concluded that the agreement itself was “at best ... ambiguous as to its term,” but that parol evidence—specifically, the bargaining history of the agreement—confirmed that the parties intended it to begin on April 13, 2005. ALJ Op. at 6. Having thus found that the term of the agreement began “no earlier than April 2005,” the ALJ concluded that Spectrum's January 2008 withdrawal of recognition and repudiation of the agreement, its refusal to recognize and bargain with the union thereafter, its ensuing unilateral changes in the terms and conditions of employment, and its promise of future benefits, were all unlawful. Id. at 7, 10–11.³ The ALJ ordered Spectrum to cease and desist from the unfair labor practices the judge had found and to bargain with the union. Id. at 11–12.

On February 26, 2009, a two-member panel of the Board adopted the findings and recommendations of the ALJ.⁴ The Board also explained its decision to adopt the ALJ's affirmative bargaining order. 353 N.L.R.B. No. 99, at 1–2 (Board Op.). Spectrum filed a motion for reconsideration, which the Board denied on April 21, 2009. On August 17, 2010, the Board vacated its February 2009 decision after the Supreme Court held, in New Process Steel, L.P. v. NLRB, ––– U.S. ––––, 130 S.Ct. 2635, 177 L.Ed.2d 162 (2010), that two-member panels of the Board were without authority to decide cases under the NLRA. Shortly thereafter, a three-member panel of the Board adopted the February 2009 decision by reference. Spectrum Health—Kent Community Campus, 355 N.L.R.B. No. 101 (Aug. 23, 2010).

Spectrum has now petitioned for review by this court, and the Board has filed a cross-application for enforcement. The company contends that the term of the 2005 bargaining agreement began on January 1, 2005, and that the conclusive presumption of majority support had therefore lapsed by the time it withdrew recognition from the union on January 7, 2008. Our review is de novo because “[t]his court owes no deference to the Board's interpretation of a disputed collective bargaining agreement.” Commonwealth Commc'ns, Inc. v. NLRB, 312 F.3d 465, 468 (D.C.Cir.2002); see Litton Fin. Printing Div. v. NLRB, 501 U.S. 190, 202–03, 111 S.Ct. 2215, 115 L.Ed.2d 177 (1991). The company also objects to the Board's imposition of an affirmative bargaining...