contrasting NLRB v. Katz’s Delicatessen of Houston Street, Inc., 80 F.3d 755, 771 (2d Cir.1996)
How later courts described this case
- contrasting NLRB v. Katz’s Delicatessen of Houston Street, Inc., 80 F.3d 755, 771 (2d Cir.1996)
Written by the judges who cited it.
The opinion
United States Court of Appeals
FOR THE DISTRICT OF COLUMBIA CIRCUIT
Decided May 16, 2006
No. 04-1267
SCEPTER, INC.,
PETITIONER
v.
NATIONAL LABOR RELATIONS BOARD,
RESPONDENT
Consolidated with
04-1362
On Petition for Review and Cross-Application for
Enforcement
of an Order of the
National Labor Relations Board
Ian K. Leavy and Ronald G. Ingham were on the brief for
petitioner Scepter, Inc.
Arthur F. Rosenfeld, General Counsel, John H. Ferguson,
Assistant General Counsel, Aileen A. Armstrong, Associate
General Counsel, Robert J. Englehart and Philip A. Hostak,
2
Attorneys, National Labor Relations Board, were on the brief
for respondent.
Before: GINSBURG, Chief Judge, and ROGERS and
BROWN, Circuit Judges.
Opinion for the Court filed by Chief Judge GINSBURG.
GINSBURG, Chief Judge: Scepter, Inc., petitions the court
for review of a 2004 order of the National Labor Relations
Board in which the Board held it lacked jurisdiction to modify
the 2000 order we had previously enforced against the
Company, see Scepter, Inc. v. NLRB, 280 F.3d 1053 (2002).
Because Scepter failed to raise its current objection to the
earlier order before we enforced it, we deny the Company’s
petition for review and grant the Board’s cross-application for
enforcement.*
I. Background
After failing to reach an agreement with the union that
represented its employees, Scepter unilaterally changed the
employees’ wages and benefits. Id. at 1055. More
specifically, Scepter modified the coverage provided by its
medical insurance plan and made the plan contributory,
requiring that each employee pay a monthly premium of $19
to $24. Scepter Ingot Castings, Inc., 331 N.L.R.B. 1509,
1514 (2000) (hereinafter the 2000 Order). Scepter also
increased each employee’s wages by 45 cents per hour, 15
cents of which it said was “[t]o help offset” the insurance
*
This case was considered upon the record from the National
Labor Relations Board and upon the briefs submitted by parties. See
FED. R. APP. P. 34(a)(2); D.C. CIR. RULE 34(j).
3
premiums. Id. In the 2000 Order, the Board held Scepter
made these unilateral changes in violation of §§ 8(a)(1) and
(5) of the National Labor Relations Act, 29 U.S.C. §§
158(a)(1), (a)(5). 331 N.L.R.B. at 1509, 1516. Accordingly,
the Board ordered Scepter to bargain with the union; to
“rescind either or both of the ... unilateral changes” -- but only
“[i]f requested by the Union”; and to “[m]ake employees
whole for any expenses ensuing” from the Company’s
adoption of the new medical insurance plan. Id. at 1510,
1517.
Scepter petitioned this court for review of the 2000
Order, raising two objections. First, Scepter argued its
unilateral actions were justified because “it possessed a
genuine, reasonable uncertainty ... whether the Union enjoyed
the support of a majority of employees.” Scepter, 280 F.3d at
1056. Second, the Company objected to the imposition of a
bargaining order. We rejected the first argument and held we
could not address the second because the Company’s
objection was not sufficiently specific to preserve the issue for
review. Id. at 1056-57, citing § 10(e) of the NLRA, 29 U.S.C.
§ 160(e) (“No objection that has not been urged before the
Board ... shall be considered by the court”).
Thereafter the union requested rescission of the change in
medical insurance plans but not of the wage increase, and a
controversy arose over the amount of back pay Scepter owed
its employees in these circumstances. The General Counsel
issued a “Compliance Specification” stating that Scepter
should be required to (1) stop charging employees for medical
insurance and (2) pay each “employee ... an amount equal to”
the premiums he or she had theretofore been charged, plus
interest. Scepter objected to the latter provision on the ground
it would give the employees a windfall because they already
4
had been compensated for the premiums they paid by the
concurrent increase in the wages they received. Scepter
therefore requested an “offset” against its “make whole”
liability in the amount of the increased wages it had paid.
An Administrative Law Judge, citing § 10(e), rejected
Scepter’s request on the ground that, the court having
enforced it, the Board “ha[d] no authority to modify” the 2000
Order, which clearly required Scepter, upon the union’s
request, to “rescind either or both” of the unilateral changes.
Scepter Ingot Castings, Inc., 341 N.L.R.B. No. 134, 2004 WL
1174585, at *9 (May 24, 2004) (hereinafter the 2004 Order).
The Board affirmed, id., at *2, Scepter petitioned for review,
and the Board cross-applied for enforcement. We will uphold
the Board’s legal conclusions if they are “reasonably
defensible,” Wackenhut Corp. v. NLRB, 178 F.3d 543, 553
(D.C. Cir. 1999).
II. Analysis
In support of its claim that the Board had jurisdiction in
2004 to modify the 2000 Order, Scepter first argues the Board
has an obligation to ensure the remedy enforced at the
compliance stage of a proceeding is appropriate, regardless
whether the order imposing that remedy has been enforced by
the court of appeals. Scepter next contends its request for an
offset was timely because the 2000 Order was ambiguous
with respect to the precise remedy being imposed;
consequently, at the compliance stage of these proceedings it
sought only clarification of its obligations under, and not a
modification of, the 2000 Order.
Scepter argues the Board had jurisdiction to allow the
requested offset because “[d]etermining and calculating the
5
appropriate and exact remedy amount” are typically “deferred
to the compliance or back pay proceeding of a dispute.”
Citing our decision in Grondorf, Field, Black & Co. v. NLRB,
107 F.3d 882 (1997), Scepter maintains that when “so
directed by a U.S. Court of Appeals, the Board has the
responsibility to allow an employer to demonstrate ... any
necessary remedy [must] be offset or reduced to avoid an
improper windfall to employees.” The Board responds that it
has no authority to modify the remedy specified in a court-
enforced order unless it had in that order reserved for later
consideration a specific question pertaining to that remedy.
The Board is correct. Section 10(e) of the NLRA
provides: “Upon the filing of the record with it the
jurisdiction of the court shall be exclusive and its judgment
and decree shall be final.” 29 U.S.C. § 160(e). The Board
obviously cannot modify an order over which the court has
“exclusive” jurisdiction or that the court has enforced in a
final judgment. Grondorf is not, as Scepter suggests, to the
contrary: The employer there challenged the remedy as a
windfall in its petition for judicial review of the order
imposing the remedy, not in an objection to a post-
enforcement Compliance Specification. 107 F.3d at 883, 888.
Although Scepter is surely correct that a court can order
the Board to modify an unlawful remedy, the court can
provide such relief only to a petitioner that timely seeks it.
The first and only opportunity for doing so is ordinarily in a
petition for review of the Board order imposing the remedy
but, if the Board reserves the issue for later consideration, that
opportunity will necessarily be deferred until the Board
resolves the issue in a subsequent order. See Cobb Mech.
Contractors, Inc. v. NLRB, 295 F.3d 1370, 1377 n.4 (D.C. Cir.
2002); Manhattan Eye Ear & Throat Hosp. v. NLRB, 942 F.2d
6
151, 156 (2d Cir. 1991) (where Board “left open the precise
remedy to be imposed in the ordered backpay proceeding,”
court’s enforcement of order did not constitute “law of the
case” as to that issue).
Scepter seeks to avoid foreclosure under § 10(e) on the
additional ground it is not “attempting to modify the Board’s
original Order” but rather “trying to clarify what the Board
and this Court intended in the original ‘make whole’ remedy.”
Relying upon NLRB v. Katz’s Delicatessen of Houston Street,
Inc., 80 F.3d 755, 771 (2d Cir. 1996), Scepter argues the court
“surely would have found ... premature” any challenge to the
remedy provided in the 2000 Order if the Company had raised
such a challenge in its petition for review of that order.
The Board denies there is any ambiguity in the 2000
Order, which it maintains clearly “imposed two distinct
affirmative requirements on the Company”: (1) to “make
employees whole for any expenses” they incurred, and (2) to
“rescind” the wage increase “[i]f [so] requested by the
Union.” The Board argues, therefore, the 2000 Order put
Scepter fully “on notice” of the alleged windfall it now
protests.
We agree with the Board that the 2000 Order was clear
and that it follows Scepter should have challenged the remedy
in its petition for review of that order. Scepter could hardly
have failed to notice the Board both (1) expressly added to the
remedy proposed by the ALJ a provision requiring Scepter to
“[m]ake employees whole for any expenses ensuing from the
Respondent’s unilateral changes in medical insurance
coverage and contributions ... with interest,” 331 N.L.R.B. at
1510, and (2) adopted the ALJ’s proposal that the wage
increase be rescinded only “on request by the Union.” Id. at
7
1511. The Board thus left no ambiguity about remedies in the
2000 Order. Nor, therefore, did it err in the 2004 Order, as
Scepter claims, by relying upon cases in which, as here, the
Board held it did not have jurisdiction to “clarif[y]” a court-
enforced order that was not ambiguous. See, e.g., Grinnell
Fire Prot. Sys. Co., 337 N.L.R.B. 141, 141 (2001).
On the contrary, it is Scepter’s reliance upon Katz’s
Delicatessen that is misplaced. In the present case, the Board
imposed a remedy that, if objectionable at all, was
objectionable on its face. In Katz’s Delicatessen, on the other
hand, the Second Circuit concluded the employer’s challenge
to an order was premature because the Board had “yet to
determine how Katz’s [retroactive payments to union welfare
and pension funds] should be structured” so as to be remedial
for the employees and not a windfall for the union -- a matter
upon which, under Manhattan Eye, 942 F.2d at 159-60, the
validity of the remedy depended. See Katz’s Delicatessen, 80
F.3d at 771.
Scepter argues nonetheless that “[b]ecause the employers
in Grondorf, Manhattan Eye, and Katz’s Delicatessen were
allowed to demonstrate the alternative benefits provided to
employees and obtain offsets, [it] could not have anticipated
that the Board would not similarly calculate the appropriate
offset in calculating its remedy to prevent a double recovery
windfall.” As we have seen, however, those decisions are
inapposite; in each case the employer raised its objection at
the first opportunity. Scepter, in contrast, failed to object
until the 2000 Order had been enforced by this court and the
Board was powerless to amend it.
As the Board points out, the 2000 Order is akin to the
order enforced by the Seventh Circuit in NLRB v. Keystone
8
Steel & Wire, Division of Keystone Consolidated Industries,
Inc., 653 F.2d 304, 306 (7th Cir. 1981), requiring the
employer both to restore the benefits employees would have
received under an unlawfully-revoked medical insurance plan
and to continue offering the benefits they newly received
under the plan the employer had unilaterally substituted. The
court “endorse[d] the Board’s policy” of “order[ing] a return
to the status quo ante with regard to the unfavorable changes,
but ... not penaliz[ing] employees by ordering revocation of
the favorable changes.” Id. at 308. In this case the Board
applied the same policy when, in the 2000 Order, it allowed
Scepter’s employees to keep the wage increase the Company
had unilaterally instituted without losing the benefit of the
non-contributory insurance plan the Company had unilaterally
terminated. Scepter had fair warning, both from the face of
the 2000 Order and from Board precedent, of the “heads they
win, tails you lose” nature of the remedy the Board was
imposing upon it.
III. Conclusion
Because Scepter did not in its petition for review of the
2000 Order challenge the remedy clearly imposed in that
order, it could not do so at the compliance stage of the
proceeding. The Board therefore correctly held in the 2004
Order that it lacked jurisdiction to grant Scepter’s post-
enforcement request for relief from the 2000 Order. Indeed, §
10 of the NLRA requires a party to file a timely exception to
an order of the Board precisely in order to “insure[] against
repetitive appeals to the courts,” Local 900, Int’l Union of
Elec., Radio and Mach. Workers, AFL-CIO v. NLRB, 727
F.2d 1184, 1191 (D.C. Cir. 1984), such as this one.
For the foregoing reasons, we deny Scepter’s petition for
9
review and grant the Board’s cross-application for
enforcement.
So ordered.