Employer Lawfully Withdrew Recognition from Union; NLRB's Findings on Hallmark Violations Were Unsupported: DC Circuit | Practical Law

Employer Lawfully Withdrew Recognition from Union; NLRB's Findings on Hallmark Violations Were Unsupported: DC Circuit | Practical Law

On May 28, 2013, the US Court of Appeals for the District of Columbia Circuit reversed in part the National Labor Relations Board's (NLRB) decision finding an employer committed an unfair labor practice (ULP) when it withdrew recognition of its employees' union. The DC Circuit held that since the employer's ULPs did not meaningfully impact or cause employee disaffection from their labor union, its withdrawal of recognition of the union was permissible.

Employer Lawfully Withdrew Recognition from Union; NLRB's Findings on Hallmark Violations Were Unsupported: DC Circuit

by PLC Labor & Employment
Published on 29 May 2013 • USA (National/Federal)
On May 28, 2013, the US Court of Appeals for the District of Columbia Circuit reversed in part the National Labor Relations Board's (NLRB) decision finding an employer committed an unfair labor practice (ULP) when it withdrew recognition of its employees' union. The DC Circuit held that since the employer's ULPs did not meaningfully impact or cause employee disaffection from their labor union, its withdrawal of recognition of the union was permissible.

Key Litigated Issues

In Tenneco Auto Inc. v. NLRB, the key litigated issue was whether the employer, Tenneco Auto Inc. (Tenneco), committed an unfair labor practice (ULP) when it withdrew recognition of its employees' labor union following the union members' decisions to petition for decertification and later petition the employer to withdraw recognition from the union.

Background

In late 2004, the union, Local 660 of the International Union of Automobile, Aerospace, and Agricultural Implement Workers of America, and Tenneco attempted unsuccessfully to bargain for a new collective bargaining agreement (CBA), which expired on May 12, 2004. The union called a strike on April 26, 2005. However, Tenneco continued operations by hiring replacement workers, retaining employees who abstained from striking and contracting out work.
The union filed ULP charges in February 2006 with the NLRB alleging that the employer, among other things, unlawfully:
  • Directed employees not to say or do anything that could "evoke a response" from other employees.
  • Disciplined an employee for pro-union activities.
  • Refused to provide the union with information relating to the possible installation of video cameras in the workplace and information about replacement workers.
  • Created a rule requiring supervisory approval before posting printed material at the company's facility.
Also in February, bargaining unit employees filed a petition with the NLRB for an election to decertify the union as their representative. Because of the pending ULP charges, the NLRB held the decertification petition in abeyance until the ULP charges were resolved.
On December 4, 2006, a substantial majority of the bargaining unit employees (24 of 31) presented a petition to Tenneco asking that it no longer recognize the union as their collective bargaining representative. Tenneco withdrew recognition from the union. The union filed an additional ULP charge alleging that the employer unlawfully withdrew recognition from the union.
An NLRB Administrative Law Judge (ALJ) rejected many of the alleged ULPs while holding the employer liable for others. Most importantly, the ALJ concluded the employees' disaffection with the union was not attributable to Tenneco's ULPs and that Tenneco lawfully withdrew recognition from the union.
After the NLRB's General Counsel and the union filed exceptions to the ALJ's findings, the panel heading the NLRB's judicial functions (Board), in a 2-1 split decision (Member Hayes dissented in part), held Tenneco liable for all of the alleged ULPs. Significantly, the Board majority held that:
  • Certain ULPs by Tenneco tainted the employees' disaffection petition.
  • Tenneco's withdrawal of recognition was unlawful.
  • It was appropriate to order Tenneco to resume collective bargaining with the union.
Tenneco petitioned for review of the Board's decision.

Outcome

On May 28, 2013, the US Court of Appeals for the District of Columbia Circuit issued an opinion in Tenneco Auto. Inc. v. NLRB, affirming in part and reversing in part the NLRB's decision. The court affirmed most of the ULP findings, but held that Tenneco lawfully withdrew recognition from the union and could not be required to engage in collective bargaining.
The DC Circuit applied the four-factor test from Master Slack, considering:
  • The length of time between the ULPs and the employee's December 2006 disaffection petition.
  • The nature of the ULPs, including whether they are of a nature that would cause a detrimental or lasting effect on the employees.
  • The tendency of the ULPs to cause employee disaffection from the union.
  • The effect of the unlawful conduct on the employees' morale, organizational activities and membership in the union.
Applying the four-factor test, the DC Circuit held that Tenneco lawfully withdrew recognition because:
  • Ten months passed between the last ULP charge and the submission of the employees' petition for decertification. The DC Circuit held that a lapse of several months typically weighs against a finding of close temporal proximity between ULPs and employee dissatisfaction with a union.
  • The violations of the NLRA were not hallmark violations that were highly coercive like discharge or the withholding of benefits. The violations in this case, a new rule regarding the posting of materials in the workplace and a warning to one employee to avoid potentially hostile discussions, did not risk having a detrimental effect on employees.
  • The Board failed to establish by substantial evidence that the alleged ULPs actually prevented communications between the replacement employees and the union.
While applying the Master Slack analysis to reach the inferences above, the DC Circuit found that:
  • The Board's factual findings:
    • were not supported by the record; and
    • ignored the ALJ's factual findings and credibility determinations on relevant facts.
  • There was no substantial evidence that Tenneco's ULPs significantly contributed to the employees' petition for decertification (Williams Enters., Inc. v. NLRB).

Practical Implications

The DC Circuit's analysis provides guidance about when an employer's ULPs may be construed as significantly contributing to its employees' disaffection from their union. The DC Circuit makes clear that for ULPs to be considered significant factors in employees disaffection from their union, they must demonstrably cause lasting and detrimental effects, and not just be numerous. The court will not simply rubber-stamp a bargaining order because the Board has found ULPs and labelled them hallmark violations. The DC Circuit also makes clear that a period of ten or more months between the last ULP and the employees' disaffection from a union negates any implication that the ULP caused a change in the majority of employees' opinions about the union.
Chairman Liebman and Members Pearce and Hayes issued this decision, with Member Hayes dissenting in substantial part. Each of these members were formally appointed to the Board at the time, so none of the recess appointment issues raised in Noel Canning v. NLRB bore on this Board panel's authority to issue the decision (see Legal Update, DC Circuit Rules NLRB Recess Appointments Were Unconstitutional; Enforceability of All Recess Appointees' Decisions in Doubt).

Court Documents