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Glomac Plastics Inc. v. National Labor Relations Board

decided: January 24, 1979.


Petition for review and cross-petition for enforcement of a decision and order of the National Labor Relations Board finding petitioner in violation of Section 8(a)(5) of the National Labor Relations Act, 29 U.S.C. § 158(a)(5) and directing a renewal of the intervenor's certification year in its entirety. Order enforced but entry of judgment withheld in part for sixty days and cause remanded to Board for further consideration.

Before Feinberg and Mulligan, Circuit Judges, and Newman, District Judge.*fn*

Author: Mulligan

Glomac Plastics, Inc. (the Company) has petitioned this court for review of a decision and order of the National Labor Relations Board (the Board) and the Board has made a cross-application for enforcement. The Board's decision and order issued on March 9, 1978 is reported at 234 N.L.R.B. No. 199. The Board found that the Company had bargained with the Amalgamated Clothing and Textile Workers Union of America, AFL-CIO-CLC (the Union) with the intention of avoiding agreement, in violation of Section 8(a)(5) of the National Labor Relations Act, 29 U.S.C. § 151 Et seq. (the Act). The Board held that the finding of bad faith bargaining was supported by the Company's withdrawal of a maintenance-of-membership proposal, and by its refusal to provide the Union with requested information necessary for an intelligent understanding of a merit wage proposal under which the Company would have retained unreviewable control of wage increases.

The Union was certified as the bargaining agent for the production and maintenance employees of the Company on June 23, 1972 following a Board- conducted election. After numerous unsuccessful bargaining sessions the Union filed charges on April 25, 1973 and the Board issued a complaint on June 8, 1973 alleging a refusal to bargain and negotiation in bad faith from January 26, 1973.*fn1 After a hearing on the issues an administrative law judge upheld the refusal to bargain charges in a decision issued September 17, 1973. On March 9, 1978, four and one-half years after the decision of the administrative law judge, the Board issued its decision and order upholding the finding of refusal to bargain in good faith and extending the Union's initial certification year for another full year from the date the Company commences good faith bargaining. On this petition the Company contests the Board's decision on the merits as well as the propriety of its remedy. We withhold for 60 days the entry of judgment enforcing the order and remand the case to the Board for further consideration.*fn2

I The Facts

During the initial certification year the parties held 15 bargaining sessions between August 9, 1972 and May 29, 1973. The ultimate areas of contention involved union security and wages. The Union on August 9, 1972 proposed a standard union security clause which required all employees to become and remain union members in good standing as a condition of employment subject to the sanction of dismissal and disqualification for further employment during the life of the agreement. It also proposed a method for payroll dues deductions. The Company made a counter offer, a voluntary maintenance-of-membership clause which required employees who were present members of the Union or those who thereafter became members, to maintain membership in good standing. In lieu of a dues checkoff, the Company offered to provide a location where a union official might collect dues before or after working hours or during the noon hour.

The Union twice modified its initial proposals at sessions in September and October, 1972 but the Company adhered to its original position. Finally, on February 13, 1973 the Company suggested that there be no union security provision in the contract but that the Company would substitute a "letter of intent" providing for maintenance-of-membership. The Company then incorporated its original maintenance-of-membership proposal of August 9 in a letter of intent which was presented to the Union. The Union representative on March 30, 1973 voiced his own disagreement with the proposal but stated that he would present it to the membership for their decision as to its acceptability. However, on April 4, before the membership could be convened at a meeting to discuss the issue, the Company withdrew its proposed "letter of intent" as well as its initial maintenance-of-membership proposal and instead offered only to provide a place for a union officer to collect dues at the times initially indicated.

At the next bargaining session a federal mediator conferred separately with each party. The Union indicated that it would accept a 6% Across the board increase coupled with the Company's initial maintenance-of-membership proposal. When this settlement was discussed by the mediator with the Company negotiators, the President of the Company became angry and belligerent, left the meeting without making a counter offer, and refused to reinstate its original maintenance-of-membership proposal.

The wage negotiations were equally unproductive. The Union presented its wage demands at a bargaining session on January 26, 1973 and sought the Company's proposal on this matter at two subsequent meetings. The Company, however, made no response until March 30 when it offered a five and one-half percent increase to be distributed on a merit basis. Under the proposal the recipients and amounts of the merit increases would be decided exclusively by the Company pursuant to a "point system" and the Company's merit raise decisions would be unreviewable. Despite repeated requests by the Union negotiators the Company refused to define for the Union any specifics as to how the unreviewable, company-run merit increase system would operate.

The Union unanimously rejected the Company's wage offer on April 8 and the following week asked for a 6% Across the board wage increase. The Company refused the demand and also refused to submit the issues to binding arbitration. Thereafter the Union conducted one-day strikes on April 23, May 1, and May 7. Despite the further intervention of the federal mediator, the Company made no other counter offers. Negotiations ended on May 29.

II The Merits

The statutory duty to bargain in good faith does not mandate that an employer submit to every union demand or forego shrewd or tough bargaining positions. N. L. R. B. v. American National Insurance Co., 343 U.S. 395, 404, 72 S. Ct. 824, 96 L. Ed. 1027 (1952). It simply requires that the parties to the negotiations demonstrate a " "serious intent to adjust differences and to reach an acceptable common ground.' " Continental Insurance Co. v. N. L. R. B., 495 F.2d 44, 48 (2d Cir. 1974). Conduct tantamount to a refusal to negotiate in fact constitutes a Per se violation of the duty to bargain in good faith. N. L. R. B. v. Katz, 369 U.S. 736, 743, 82 S. Ct. 1107, 8 L. Ed. 2d 230 (1962). Far more often, however, as in the instant case the Board finds no conduct which on its face is violative of section 8(a)(5). The Board must then evaluate the totality of a party's conduct to establish whether negotiations were merely a charade concealing a desire to frustrate agreement. Continental Insurance Co. v. N. L. R. B., supra. In arriving at this determination the Board may rely on surrounding events and comments as indicia of the subjective intent motivating conduct at the bargaining table. N. L. R. B. v. Patent Trader, Inc., 415 F.2d 190, 197 (2d Cir. 1969), aff'd as modified, 426 F.2d 791 (1970) (en banc). Moreover, we will not lightly disregard the Board's expertise in assessing whether the party's conduct evidences a sincere desire to reach agreement. N. L. R. B. v. Insurance Agents' International Union, AFL-CIO, 361 U.S. 477, 498-99, 80 S. Ct. 419, 4 L. Ed. 2d 454 (1960); International Union, United Automobile, Aerospace and Agricultural Implement Workers v. N. L. R. B., 147 U.S.App.D.C. 289, 296-97, 455 F.2d 1357, 1364-65 (1971). On this appeal our function is to determine only whether substantial evidence on the record as a whole supports the Board's conclusion that the Company was intent upon avoiding an agreement with the Union. E. g., Universal Camera Corp. v. N. L. R. B., 340 U.S. 474, 71 S. Ct. 456, 95 L. Ed. 456 (1951); N. L. R. B. v. Windham Community Memorial Hospital, 577 F.2d 805, 809 (2d Cir. 1978). We hold that there is such evidence.

As the administrative law judge found, the Company's rejection of a union security clause and its insistence instead on a maintenance-of-membership proposal was lawful so long as the Company's position on this issue was not taken in order to thwart agreement. Caroline Farms Division of Textron, Inc. v. N. L. R. B., 401 F.2d 205, 210-11 (4th Cir. 1968). The subsequent withdrawal by the Company of the maintenance-of-membership offer and the refusal to reinstate that proposal did not constitute a Per se violation of section 8(a)(5) since the parties had agreed at the outset of negotiations that tentative agreements on specific issues were not to be considered binding until accord had been reached on the entire bargaining agreement. In the circumstances of this case, however, the withdrawal could properly have been viewed as evidencing the Company's bad faith. See, e. g., Texas Coca-Cola Bottling Co., 146 N.L.R.B. 420, 430 (1964), enf'd, 365 F.2d 321 (5th Cir. 1966).

It has been held that "(patently) improbable justifications for a bargaining position will support an inference that the position is not being maintained in good faith." Queen Mary Restaurants Corp. v. N. L. R. B., 560 F.2d 403, 409 (9th Cir. 1977); see also N. L. R. B. v. Milco, Inc., 388 F.2d 133, 138-39 (2d Cir. 1968). Here the Company advanced highly implausible grounds for the withdrawal of the maintenance-of-membership proposal. At the hearing, Company president MacKessy testified that he withdrew the offer due to his good faith doubt that the Union continued to command the loyalty of a majority of its employees.*fn3 MacKessy claimed that his doubt as to continuing majority status rested largely on the lack of employee support for ...

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