Tualatin Electric, Inc. v. National Labor Relations Board

United States Court of Appeals

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued March 8, 2001 Decided June 15, 2001

No. 00-1242

Tualatin Electric, Inc.

Petitioner

v.

National Labor Relations Board,

Respondent

International Brotherhood of Electrical

Workers, Local 48,

Intervenor

On Petition for Review and Cross-Application for

Enforcement of a Supplemental Order of the

National Labor Relations Board

Karen O'Kasey argued the cause for petitioner. With her

on the briefs was Thomas M. Triplett.

Steven B. Goldstein, Attorney, National Labor Relations

Board, argued the cause for respondent. With him on the

brief were Leonard R. Page, General Counsel, John H.

Ferguson, Associate General Counsel, Aileen A. Armstrong,

Deputy Associate General Counsel, and Julie B. Broido,

Supervisory Attorney.

Norman D. Malbin argued the cause and filed the brief for

intervenor International Brotherhood of Electrical Workers,

Local 48.

Nora H. Leyland and Victoria L. Bor were on the brief for

amicus curiae International Brotherhood of Electrical Work-

ers, AFL-CIO.

Before: Ginsburg, Sentelle and Rogers, Circuit Judges.

Opinion for the Court filed by Circuit Judge Ginsburg.

Ginsburg, Circuit Judge: Making use of a tactic called

"salting," the International Brotherhood of Electrical Work-

ers, Local No. 48 authorized several of its members to seek

work at Tualatin Electric, a nonunion electrical contractor, in

order to advocate union membership among Tualatin's em-

ployees and to gather information that might assist the Union

in an election campaign. Tualatin discharged one such em-

ployee, or "salt," because of his union activity and refused to

hire four other job applicants because it suspected they were

affiliated with the Union. The National Labor Relations

Board held, in proceedings not here under review, that the

dismissal and the refusals to hire were unfair labor practices

in violation of the ss 8(a)(1) and (3) of the National Labor

Relations Act, 29 U.S.C. ss 158(a)(1), (3). See Tualatin

Electric, Inc., 312 NLRB 129, 135 (1993) ("Tualatin I"), enf'd

sub nom. Tualatin Electric, Inc. v. NLRB, 84 F.3d 1202 (9th

Cir. 1996) (discharge); Tualatin Electric, Inc., 319 NLRB

1237, 1237 (1995) ("Tualatin II") (refusals to hire).

After further proceedings the Board awarded backpay to

the five discriminatees. See Tualatin Electric, Inc., 331

NLRB No. 6, slip op. at 1-2 (2000) ("Decision"). Tualatin

petitions for review of the Decision on the grounds that salts

are not entitled to backpay under the Act and, in the alterna-

tive, that the Board miscalculated the amounts of backpay

due the salts in this case. Because the Board's determina-

tions are based upon reasonable interpretations of the Act

and of the Board's own precedents, we deny Tualatin's peti-

tion and grant the Board's application for enforcement.

I. Background

In 1992 the Union began an effort to organize Tualatin by

salting Project Thunder, a construction site at which Tualatin

was a subcontractor. Under its "salt program," the Union

paid its agents working in non-union shops the amount neces-

sary to bring their wages up to union scale; it also required

salts to terminate their employment at the Union's behest, or

else to face substantial fines. See Decision at 3 n.1; Tualatin

II, 319 NLRB at 1239. The Union's salting campaign against

Tualatin continued until December 20, 1993, when it advised

Tualatin by letter that it no longer sought either "to organize

... [or] to represent Tualatin's employees"; referring to the

discharge and the refusals to hire at issue in this case, the

Union said that instead it "intend[ed] to use picketing to

truthfully advise the public of Tualatin Electric's illegal acts."

Decision at 6.

In July 1992 Edward Campbell, having agreed to salt

Tualatin for the Union, sought and obtained a job as a

journeyman electrician on Tualatin's Project Thunder. Two

weeks later he was cashiered. Tualatin I, 312 NLRB at 131.

In settlement of the resulting unfair labor practice (ULP)

case, Tualatin agreed to reinstate Campbell; when Campbell

reported for work, however, Tualatin assigned him not to

Project Thunder but to its Wal-Mart jobsite, which increased

his round-trip daily commute by at least 60 miles. See

Tualatin I, 312 NLRB at 132; Decision at 6. Campbell,

believing that employment at Wal-Mart did not constitute

"reinstatement," abandoned the job after two days. Tualatin

I, 312 NLRB at 132. The Board concluded that Tualatin

violated the settlement agreement by substituting Wal-Mart

for Project Thunder, and that Tualatin had dismissed Camp-

bell in the first place because of his union activity. Id. at 133,

135. The Board ordered Tualatin to reinstate Campbell and

scheduled further proceedings to determine the amount of

backpay due him. Id. at 129, 135. The Ninth Circuit denied

Tualatin's petition for review of the Board's holding that it

had violated the settlement agreement. See Tualatin Elec-

tric, 84 F.3d at 1205.

Several months after Campbell's botched reinstatement,

Tualatin denied the employment applications of four other

union salts, including Gary Mangel. The Board found that

Tualatin had unlawfully refused to hire the four because it

knew or suspected they were connected with the Union. The

Board ordered that they be hired and that further proceed-

ings be conducted to determine the amount of backpay due

each. Tualatin II, 319 NLRB at 1241-42. Tualatin agreed

not to contest the "findings of fact and conclusions of law

underlying" Tualatin II except insofar as they concerned

"the amount of backpay due"; the Board then consolidated

the backpay proceedings arising from Tualatin I and Tuala-

tin II. Decision at 3.

In those proceedings the ALJ rejected Tualatin's argument

that salts are not entitled to backpay under the Act. He also

held that the salts' backpay remedies should be calculated

under the rubric of Dean General Contractors, 285 NLRB

573 (1987), whereby the Board presumes, subject to rebuttal

by the employer, that an unlawfully discharged employee in

the construction industry would have been reassigned to a

new project upon the termination of the project at which he

had been working. The ALJ further held, contrary to Tuala-

tin's position, that (1) backpay was available for the period

after the Union's letter announcing the termination of its

organizing effort; and (2) seeking employment exclusively at

union shops did not breach the salts' duty to mitigate, for

which "a discriminatee need only follow his regular method

for obtaining work." Id. at 5.

The ALJ also resolved several issues regarding mitigation

in favor of particular discriminatees. He concluded that the

period for which Campbell was due backpay was not tolled by

his departure from the Wal-Mart project; "inasmuch as the

Ninth Circuit and the Board had concluded that his reinstate-

ment was invalid, Campbell was not required to have accept-

ed it under any circumstances." Id. at 6. Nor was backpay

tolled when Campbell resigned a salting job with another

nonunion contractor at the direction of the Union; avoiding

union discipline, ruled the ALJ, is "good cause" for quitting a

nonunion job. Id. Finally, the ALJ held that backpay for

Gary Mangel was not tolled when he refused several short-

term jobs so that he would not lose his eligibility for a long-

term job under the rules of the Union's hiring hall. Id. at 9.

The Board upheld the decisions of the ALJ in all respects,

id. at 1-2, Member Hurtgen dissenting in part. Tualatin now

petitions for review of the Board's decision, and the Union

intervenes on behalf of the Board.

II. Analysis

Tualatin challenges several of the legal principles the

Board applied in calculating the amount of backpay due the

discriminatees. We uphold the Board's legal determinations

so long as they are neither arbitrary nor inconsistent with

established law. See, e.g., Lee Lumber & Bldg. Material

Corp. v. NLRB, 117 F.3d 1454, 1460 (D.C. Cir. 1997) (NLRB

"to be given a great deal of deference in developing the rules

that it will apply to particular situations").

First, Tualatin argues that salts are necessarily ineligible

for a backpay remedy, which "must be sufficiently tailored to

expunge only the actual, and not merely speculative, conse-

quences of" an ULP. Sure-Tan, Inc. v. NLRB, 467 U.S. 883,

900 (1984) (emphases omitted). The employer contends that

a damages due a salt are invariably speculative because a

salt's job tenure depends not only upon his employer but also

upon his union. Contrary to the Board's claims, Tualatin is

not estopped from making this argument by its agreement

not to contest the findings and conclusions reached in Tuala-

tin II: the argument addresses "the amount of backpay due,"

which Tualatin expressly reserved the right to challenge.

Nor is the argument precluded by Tualatin Electric v.

NLRB, which decided only that Campbell's assignment to the

Wal-Mart project did not amount to reinstatement, and en-

forced a Board order that by its terms requires further

proceedings to determine Tualatin's backpay liability. 84

F.3d at 1205-06.

On the merits, however, we agree with the Board that

Tualatin's argument is incompatible with the Supreme

Court's holding that, although he "serv[es] two masters," a

salt is an "employee" within the meaning of the National

Labor Relations Act, 29 U.S.C. s 152(3). NLRB v. Town &

Country Elec., Inc., 516 U.S. 85, 94-95 (1995). In light of the

Court's holding that salts "do not forfeit their 'employee'

status or their statutory protection from unlawful discrimina-

tion," the Board properly reasoned that neither "do [salts]

forfeit their eligibility for backpay ... to remedy the discrim-

ination." Decision at 1 (citing Town & Country, 516 U.S. at

95).

Second, Tualatin objects to the Board's presumption that

the discriminatees' employment would not have ended with

Project Thunder, which the Board based upon a line of cases

originating with Dean, 285 NLRB at 575. See Decision at 1;

see also Casey Elec. Inc., 313 NLRB 774, 774 (1994). An

employer may rebut the Dean presumption by showing that

under its "established policies," the employee would not have

been reassigned. Decision at 1. Tualatin does not claim to

have rebutted the presumption; instead it argues that Dean

should be overruled or, in the alternative, not applied to cases

involving salts. Again we reject the Board's objection to an

argument being raised but agree with the Board on the

merits.

The Board contends that its reliance upon Dean in Tuala-

tin I and II precludes Tualatin from relitigating here the

applicability of that case; in fact, however, the two earlier

proceedings leave open the question whether Dean should be

applied when calculating backpay for salts. In Tualatin I the

only reference to Dean is "for the proposition that the

question of whether backpay is due a discriminatee ... is

appropriately resolved during the compliance process." Tua-

latin I, 312 NLRB at 129 n.1. Although the Board said in

Tualatin II that "reinstatement and backpay recommenda-

tions are subject to the procedures discussed in Dean," 319

NLRB at 1242, here the employer, as we noted above,

reserved the right to challenge those aspects of Tualatin II

relevant to the calculation of "the amount of backpay due."

On the merits, Tualatin first suggests generally that the

Dean rule is unduly complicated and prejudicial to employers

in the construction industry, who in staffing an ever-changing

roster of projects will often have lawful reasons for not

transferring a particular employee. That is no basis, howev-

er, for concluding that Dean's allocation of the burden of

production is arbitrary or contrary to law.

The employer then claims that Dean should not be applied

to salts. Dean places upon the employer the burden of

showing that an employee would not have been transferred in

part because the relevant "[e]vidence ... would tend primari-

ly to be in the possession of the respondent employer which

controls the decision whether to transfer or reassign." Dean,

285 NLRB at 574-75. Tualatin argues that because a salt's

ability to "transfer or reassign" depends upon the union's

approval, in salting cases it is the union that "tend[s] primari-

ly" to have the relevant evidence. To continue imposing the

evidentiary burden upon the employer when the evidence is in

the hands of the union would, according to Tualatin, be a

"terrible injustice."

Tualatin overstates the degree to which the Dean presump-

tion is based upon the employer's superior access to evidence;

that is but one of several reasons underpinning Dean. At

least as important, per the Board, is the judgment that the

policies of the Act make it undesirable "to apply a presump-

tion in favor of an adjudicated wrongdoer while seeking to

remedy the underlying unfair labor practice committed

against the aggrieved employee." Dean, 285 NLRB at 574;

see also Ferguson Elec. Co., Inc., 330 NLRB No. 75, slip op.

at 3 (2000), enf'd, 242 F.3d 426 (2d Cir. 2001) ("The Board

resolves compliance-related uncertainties or ambiguities

against the wrongdoer"). The principle that the party who

has acted unlawfully should bear the burden of producing

evidence for the purpose of limiting its damages has as much

force in a case involving salts as in any other. We therefore

hold that the Board may apply the Dean presumption when

calculating the backpay due to salts. The employer, of

course, retains the correlative right to seek out and to present

evidence that a salt would not have been transferred at the

conclusion of the project on which he last worked, whether by

reason of the union's policies or of its own.

Third, Tualatin objects to the Board's determination that

the salts "satisf[ied] their obligation to mitigate damages

because they followed their normal pattern of seeking em-

ployment through the Union's hiring hall." Decision at 1.

The employer claims first that the agency precedents the

Board cites in support of this conclusion are distinguishable

and inapposite. That is of no moment, for the Board is

entitled to elaborate upon its previous decisions in any way

that it reasonably believes will advance the purposes of the

Act. The Board did not unreasonably extend its precedents

in applying here its rule that an employee's normal job-

seeking efforts fulfill the duty to mitigate. See Ferguson

Elec., 330 NLRB No. 75, slip op. at 6 ("In seeking interim

employment, a discriminatee need only follow his regular

method for obtaining work"); cf. Big Three Indus. Gas, 263

NLRB 1189, 1217 (1982), overruled on other grounds, Ameri-

can Navigation Co., 268 NLRB 426, 427 (1983) (reasonable

for employee searching for work in mitigation to hew to

jobseeking patterns "tradition[al] in the trade").

Tualatin also echoes an argument raised by Member Hurt-

gen in dissent: because salts were authorized to work on

some nonunion jobs at the time they were dismissed or not

hired, they should be required to seek nonunion work in

mitigation. As Member Hurtgen put it, that the Union might

not approve of such employment "cannot be a justification for

a failure to mitigate." Decision at 3. Although that position

is certainly reasonable, it is not unreasonable for the Board to

limit the duty to mitigate so as not to require a salt to accept

employment that would subject him to union discipline or

require him to abandon full union membership. We therefore

uphold the Board in this respect as well.

Fourth, Tualatin challenges the Board's decision that back-

pay continued to accrue after the Union announced the end of

its salting campaign. According to Tualatin this is inappro-

priate because the end of the Union's organizing effort also

would have marked the end of the salts' employment. As the

Board points out, however, what Tualatin ignores is that "the

Union continued to authorize its members to work for the

Respondent after [the end of the campaign] in order to obtain

information in support of its area standards picketing." Deci-

sion at 1 n.1. We therefore reject Tualatin's argument.

Fifth, Tualatin contends that its backpay obligation to

Campbell ended when he quit two days after Tualatin had

"reinstated" him at the Wal-Mart Project. Because "Project

Thunder was coming to a conclusion" while the Wal-Mart

project "promised substantial additional work into the indefi-

nite future," Tualatin maintains that Campbell at least should

have been required to keep working while he asked the Board

for relief. "[P]ublic policy reasons," says Tualatin, "strongly

support the work and grieve concept." The Board, however,

unanimously adopted the conclusion of the ALJ that Camp-

bell's quitting was not a breach of his duty to mitigate

because, "as the Ninth Circuit and the Board had concluded

that his reinstatement was invalid, Campbell was not required

to have accepted it under any circumstances." Decision at 6.

The Board also noted that the Wal-Mart project was signifi-

cantly further from Campbell's home than was Project Thun-

der, making the two positions not "substantially equivalent."

Id. Tualatin nowhere explains why its policy judgment

should outweigh the deference owed to the Board's contrary

judgment.

Alternatively, Tualatin claims the Board should have tolled

Campbell's backpay as of his acceptance, with Union approv-

al, of employment as a salt at another nonunion contractor.

Campbell worked at that job for two weeks before quitting at

the behest of the Union. See Decision at 2. The Board held

that Campbell could, without reducing his entitlement to

backpay, resign rather than having to stay on that job and

"subject himself to internal union discipline." Id. Tualatin

argues that the precedent cited by the Board, Local 90

Operative Plasterers v. Cement Masons' Int'l Ass'n, 252

NLRB 750, 754 (1980), is not controlling; that is irrelevant

because the Board never suggested its holding was compelled

by that case. See Decision at 2. Tualatin argues further

that it is "[in]appropriate," "ironic[ ]," and contrary to both

"[c]ommon sense" and "[c]ommon decency" to hold a salt's

employer liable for backpay when "the Union, for its own

reasons, elects to require its employee/members to terminate

[their mitigating] employment with a third party." The

Board, however, is of the view that it would be "inappropri-

ate" to require an employee acting to mitigate the injury

caused by an employer's ULP to subject himself to union

sanctions that he would not have incurred had the employer

not acted unlawfully. Mere disagreement with this policy

view -- and that is all Tualatin offers -- is not a basis upon

which this court may reverse a decision of the Board. See,

e.g., Pacific Micronesia Corp. v. NLRB, 219 F.3d 661, 665

(D.C. Cir. 2000).

Finally, Tualatin objects to the Board's holding that Man-

gel did not breach his duty to mitigate by declining offers of

short-term work so he could remain eligible, under the rules

of the Union's hiring hall, for a long-term assignment. See

Decision at 9. The Board endorsed the ALJ's determination

that "[a] discriminatee may legitimately refuse a referral if he

can reasonably expect to obtain employment in the future

which would clearly be a better opportunity." Id. (quoting

Plumbers Local 305, 297 NLRB 57, 60 (1989)). Yet again,

Tualatin's argument that the ALJ's decision is not compelled

by the cited precedent is unavailing. Tualatin also argues

that it would be more sensible to require an employee to

accept any job offered because one can never be sure how

long a purportedly longer job will actually last. In the view

of the Board, however, an employee does not violate his duty

to make a "diligent or reasonable search" for work when he

rejects a short-term assignment based upon a "reasonable

expectation" -- which necessarily falls short of a certainty --

that doing so will enhance his chances to secure a long-term

job. See Decision at 9. This position, being neither unrea-

sonable nor contrary to precedent, commands the deference

of the court.

III. Conclusion

Because the Board's Decision is reasonable and consistent

with applicable law, we deny Tualatin's petition for review

and grant the Board's application for enforcement.

So ordered.