General Service v. NLRB

In the

United States Court of Appeals

For the Seventh Circuit

No. 99-2577

General Service Employees Union,

Local No. 73, SEIU, AFL-CIO, CLC,

Petitioner,

v.

National Labor Relations Board,

Respondent.

Petition to Set Aside Decision

of the National Labor Relations Board.

Nos. 13 CA 33078 & 13 CA 33382

Argued February 10, 2000--Decided October 16, 2000

Before Flaum, Chief Judge, and Coffey and Diane P.

Wood, Circuit Judges.

Diane P. Wood, Circuit Judge. The National Labor

Relations Act (the Act) sets forth the general

framework under which employees and management

structure their relationships, whether in a union

context or a non-union context. This case

requires us to decide whether the Board strayed

beyond the permissible boundaries of

interpretation of the Act when it decided that a

prohibition against certification of so-called

mixed unions (including both security guards and

non-guards) really meant that such unions were

for many purposes entirely outside the scope of

the Act. We conclude that the Board pushed

further than the Act permits when it concluded

that a prohibition against certifying certain

types of unions under the terms of section

9(b)(3), 29 U.S.C. sec. 159(b)(3), also meant

that the unions were otherwise unprotected under

the statute. We therefore set aside the Board’s

decision and remand for further proceedings.

Temple Security provides security services for

various clients, through security guards that it

employs. On September 2, 1986, Temple voluntarily

recognized the General Service Employees Union

(Union) as the representative of all of its

employed guards. Temple and the Union entered

into a collective bargaining agreement (CBA), and

for several years they maintained a smooth

relationship, renewing their CBA every two years.

The latest of these CBAs was effective from

October 1, 1992, until December 31, 1994. On

October 4, 1994, the Union, in keeping with the

parties’ usual practice, sent Temple a letter

indicating that it was ready to begin

negotiations for the next two year contract.

Temple abruptly and unilaterally informed the

Union that it planned to discontinue their

relationship at the end of the contract term,

December 31, 1994. Nine days later it recognized

a new union (the Independent Courier Guards

Union, or ICG) as its guards’ representative and

signed a CBA with this new union on January 31,

1995.

The Union filed charges with the National Labor

Relations Board (the Board), claiming that

Temple’s refusal to bargain and its recognition

of a new union violated sections 8(a)(5), (3),

(2), and (1) of the National Labor Relations Act

(the Act). The Board and the parties agreed to

skip the step of going to an Administrative Law

Judge, and on May 28, 1999, the Board issued an

order against the Union. The key fact, in the

Board’s view, was that the Union admitted both

guards and non-guards to its membership, and

hence was a "mixed" union for purposes of section

9(b)(3). That section prohibits the Board from

certifying mixed unions as the representative of

employees in the bargaining unit, but it says

nothing about their status for other purposes

under the Act. Nonetheless, the Board reasoned

from the prohibition on certification that the

Union also had no rights under section 8 that it

could enforce, and it rejected all the Union’s

claims.

We review the Board’s decision deferentially.

See NLRB v. Transport Service Co., 973 F.2d 562,

566 (7th Cir. 1992). The facts below are not

contested; we examine only the Board’s legal

conclusions to determine whether they are

irrational or inconsistent with the Act. See id.

Our review is also constrained by the analysis

set forth in Chevron U.S.A. Inc. v. Natural

Resources Defense Council, Inc., 467 U.S. 837

(1984). The Supreme Court recently summarized the

approach required by Chevron as follows:

. . . [A] reviewing court must first ask whether

Congress has directly spoken to the precise

question at issue. If Congress has done so, the

inquiry is at an end; the court must give effect

to the unambiguously expressed intent of

Congress. But if Congress has not specifically

addressed the question, a reviewing court must

respect the agency’s construction of the statute

so long as it is permissible.

FDA v. Brown & Williamson Tobacco Corp., 120 S.

Ct. 1291, 1300 (2000) (internal quotations and

citations omitted). Brown & Williamson also made

clear that the determination of whether Congress

has specifically addressed a point is a

contextual one, and that "[t]he meaning--or

ambiguity--of certain words or phrases may only

become evident when placed in context." Id. at

1300-01.

The Court has made it clear in a number of

decisions that the NLRB is one of the agencies to

which Chevron deference is owed. See, e.g., Holly

Farms Corp. v. NLRB, 517 U.S. 392, 398-99 (1996);

NLRB v. Town & Country Electric, Inc., 516 U.S.

85, 90 (1995); Lechmere, Inc. v. NLRB, 502 U.S.

527, 536 (1992). Nonetheless, that means the

Chevron doctrine in its entirety: both the part

that requires a court to defer when ambiguities

exist, and the part that requires a court to

enforce the plain terms of a statute against the

agency when there is no ambiguity. It is in that

light, therefore, that we approach the question

whether the limitation on certification found in

section 9(b)(3) has the broad implications the

Board attributed to it.

The Act considers guards "employees." See 29

U.S.C. sec.sec. 152, 159. It grants employees

rights to join labor unions and bargain

collectively in section 7. See 29 U.S.C. sec.

157. In section 8(a), it limits employer activity

in order to protect those section 7 rights:

pertinent to our discussion here, section 8(a)(1)

prohibits employers from interfering with,

restraining, or coercing employees in the

exercise of their section 7 rights; section

8(a)(3) forbids employers from discriminating in

regard to hiring or any term or condition of

employment to encourage or discourage employee

membership in a labor union; and section 8(a)(5)

prohibits an employer from refusing to bargain

collectively with a representative union. See 29

U.S.C. sec.sec. 158(a)(1), (3), and (5).

The duty to bargain and to refrain from

instituting unilateral changes in wages and

working conditions under section 8(a)(5) normally

outlives the parties’ CBA. An employer is

required to "maintain the status quo after the

expiration of a collective bargaining agreement

until a new agreement is reached or until the

parties bargain in good faith to impasse." NLRB

v. Emsing’s Supermarket, 872 F.2d 1279, 1285 (7th

Cir. 1989) (internal quotations omitted); see

also Peerless Roofing Co. v. NLRB, 641 F.2d 734,

736 (9th Cir. 1981). This rule is designed to

promote industrial peace by protecting the

stability of long term employer-union

relationships. See Fall River Dyeing & Finishing

Corp. v. NLRB, 482 U.S. 27, 38 (1987). The

enforcement of the status quo ante during

renegotiations helps to ensure that the employer

will not be able to exercise an unfair advantage

by threatening to remove all the concessions for

which the union has previously bargained. See

Peerless Roofing, 641 F.2d at 736.

The twist here is that, as a mixed-guard union,

the Union was not entitled at the outset to be

certified as the representative of its employees.

Nothing in section 9(b)(3), however, forbids an

employer from voluntarily recognizing such a

union. (We note as well that section 9(b)(3)

looks nothing like section 8(a)(2), 29 U.S.C.

sec. 158(a)(2), which absolutely forbids

employer-dominated unions. See NLRB v. Newport

News Shipbuilding & Dry Dock Co., 308 U.S. 241,

251 (1939).) The Board insists that the fact that

certification is forbidden has consequences

beyond the usual benefits that go along with

certification (about which we have more to say

below). It reasons that the prohibition found in

section 8 against employer unilateral action

after a CBA has expired cannot apply to a union

whose role in the workplace began with voluntary

recognition. Instead, it continues, once the term

of a CBA is up, the Act entirely ceases to apply

to the parties. One could imagine policy

arguments both for and against the Board’s

position: proponents would argue that there

should be a way of ending a voluntary

relationship, while opponents would point out

that this position runs counter to the Act’s

policy of attempting to ensure fair and smooth

CBA renegotiations in order to promote stable,

long term employer-union relationships. In our

view, however, the policy arguments are all

beside the point (and thus we have no duty to

defer to the Board’s preferred policy), because

the exception proposed by the Board is simply not

a part of the Act’s plain text.

The Board relies on a Second Circuit decision,

Truck Drivers Local Union No. 807 v. NLRB, 755

F.2d 5 (2d Cir. 1985), which upheld Wells Fargo

Armored Service Corp., 270 NLRB 787 (1984), to

support its position. The Truck Drivers and Wells

Fargo argument proceeds as follows: (1) section

9(b)(3) of the Act states that the Board may not

certify a unit represented by a mixed-guard

union; (2) the purpose of this prohibition is to

prevent potential intra-union conflicts between

guards and non-guards; and (3) (here is the

imaginative leap) requiring maintenance of the

status quo under section 8(b)(5) of the Act after

the term of the CBA has expired is analogous to

requiring certification of the unit; since the

Act prohibits the latter, it must prohibit the

former.

The Truck Drivers court, writing before the

Supreme Court had elaborated upon the Chevron

test, first saw this as a case in which it was

obliged to defer to the Board’s interpretation of

the statute. After acknowledging both the

prohibition on certification for mixed unions and

the validity of voluntary recognition of such

unions, it examined in some detail the

legislative history of section 9(b)(3), which it

found was directed toward the risk of divided

loyalties when a guard is called upon to enforce

the employer’s rules against a fellow union

member. Last, the court thought that it was

"reasonable to infer from the statutory language

and the decisions under it that the preclusion of

certification portends more than merely a simple

check on the Board’s power to certify the results

of an election." 755 F.2d at 9-10. In other

words, the court seemed to be saying, it is

reasonable to infer that prohibiting

certification means something more than

prohibiting certification.

With part of this we have no disagreement.

Section 9(b) plainly cabins the power of the

Board to certify appropriate bargaining units.

See 29 U.S.C. sec. 159(b). Section 9(b)(1)

prohibits the Board from deciding that a unit

including professionals and non-professionals is

appropriate unless a majority of the

professionals vote for inclusion. See id. Section

9(b)(3) does two things. First, it prohibits the

Board from deciding that a unit including guards

and non-guards is appropriate. See id. Second, it

explains that "no labor organization shall be

certified as the representative of employees in

a bargaining unit of guards" if that labor

organization is a mixed-guard union. Id.

(emphasis added). Section 9(b)(3), then, does not

prohibit the Board from finding that units made

up solely of guards are appropriate. The only

limitation on the Board’s power vis-a-vis units

including guards is that, under 9(b)(3), the

Board may not certify unions to represent them if

the union also includes non-guards (i.e. it is

"mixed").

We do not agree, however, that there is any

need to look beyond the language of the Act to

understand the scope of the limitation created by

section 9(b)(3). See Air Line Pilots Ass’n,

Intern. v. United Air Lines, Inc., 802 F.2d 886,

914 (7th Cir. 1986). The Act clearly describes

the certification process, and in so doing it

provides the kind of context for understanding

section 9(b)(3) that the Supreme Court called for

in Brown & Williamson. Section 9 lays out a

process by which employees, labor organizations,

and employers may petition the Board to conduct

an election and then to certify the results. See

29 U.S.C. sec. 159. An employer also has a right,

under section 9(c), to petition the Board and

force a union claiming to represent a majority of

employees in an appropriate unit to undergo a

Board-certified election. See 29 U.S.C. sec.

159(c); Exxel/ Atmos, Inc. v. NLRB, 28 F.3d 1243,

1246 (D.C. Cir. 1994). Once a unit has been

certified by the Board, the representative union

is protected from interference with its

representation by other unions, the employer, and

even dissatisfied employees for a period of one

year (a breaking-in period). See 29 U.S.C. sec.

159(c).

This certification process is not the only way

for a union to become a representative under the

Act. An employer may also extend the Act’s

coverage to its relationship with a union

representing a majority of a group of its

employees by voluntarily recognizing the union.

See NLRB v. Gissel Packing Co., 395 U.S. 575, 600

(1969); Lincoln Park Zoological Soc. v. NLRB, 116

F.3d 216, 219 (7th Cir. 1997). Importantly, there

are differences between a certified union and a

voluntarily recognized union. A voluntarily

recognized union is not entitled to the special

privileges afforded to Board-certified unions:

those privileges include the section 9(c)(3) one-

year non-rebuttable presumption of majority

status; the section 8(b)(4)(C) prohibition

against recognitional picketing by rival unions;

and the freedom from work assignments disputes

restrictions in section 8(b)(4)(D) and from

restrictions on recognitional and organizational

picketing in section 8(b)(7). See 29 U.S.C.

sec.sec. 159, 158; Gissel Packing Co., 395 U.S.

at 599 n.14.

On the other hand, voluntarily recognized unions

are entitled to the basic protections of the Act:

"[c]ertification gives an organization which

achieves it additional rights[,] not all its

rights." NLRB v. White Superior Division, White

Motor Corp., 404 F.2d 1100, 1103 n.5 (6th Cir.

1968). "Section 9(b)(3) is a limitation not upon

employee rights [(such as those found in sections

7 and 8 of the Act)] but upon Board powers." NLRB

v. Bel-Air Mart, Inc., 497 F.2d 322, 327 (4th

Cir. 1974). Thus, voluntarily recognized unions

and the employees represented by them are still

protected by 8(a)(5)’s duty to bargain. See

Gissel Packing Co., 395 U.S. at 600. The Act does

not hinge employees’ section 7 rights, or their

section 8 protections, on certification; neither

section 7 nor section 8 mentions the term. See 29

U.S.C. sec.sec. 157, 158; Bel-Air Mart, 497 F.2d

at 327. To qualify for section 7 and section 8

protections, a union must simply be a

"representative[ ] of [the] employees." 29 U.S.C.

sec. 158(a)(5). Representatives include all of

those unions "designated or selected for the

purposes of collective bargaining by the majority

of the employees in [an appropriate] unit." 29

U.S.C. sec. 159(a).

In keeping with these principles, courts

normally apply the Act’s protections to

voluntarily recognized unions. For example,

sections 7, 8(b)(3), and 8(b)(1) have been found

to apply to protect guard employees from their

employer’s attempts to discourage their

membership in a mixed-guard union. See White

Superior, 404 F.2d at 1103 (refusing to create an

exception to section 8(b)(3) for uncertified

unions, because Congress did not do so); see also

Bel-Air Mart, Inc., 497 F.2d at 327-28. Section

8(a)(5) has also been found to apply whether or

not certification has occurred. See NLRB v.

Montgomery Ward & Co., 399 F.2d 409, 412-13 (7th

Cir. 1968) (finding that a voluntarily recognized

union representative, just like a certified

representative, must be bargained with, in good

faith, for a reasonable time before a

decertification petition will be allowed). The

Board itself has found that the Act’s contract-

bar rule applies to uncertifiable mixed-guard

union representatives to protect parties to

collective bargaining agreements from outside

petitions. See Stay Security and United Union of

Security Guards, 311 NLRB 252, 252-53 (1993).

We may not attribute more to certification than

Congress has chosen to. Creating an exception to

section 8(a)(5) protections based on

uncertifiability would do just that. The Act

specifically limits mixed-guard unions only with

respect to Board certification. It attaches

particular benefits to certification, and it

refrains from conditioning the benefits of

sections 7 and 8(a) on certification. This has

the effect of establishing a balance between the

right of an employer to protect its property, and

"the importance of stability in collective

bargaining agreements." Stay Security, 311 NLRB

at 252-53. Part of that balance is the Act’s

determination that its concern for an employer’s

property rights "is not undermined when the

employer voluntarily waives its 9(b)(3) rights

and recognizes a guard/nonguard union for a unit

of guards." Id. Contrary to the Board’s

arguments, voluntary recognition does not

permanently lock the parties into their

relationship. An impasse in good-faith

bargaining, or a showing, after a reasonable

time, of minority rather than majority support,

will both allow an employer to end its pairing

with a recognized representative (whether that

recognition began voluntarily or through more

formal processes). We express no opinion at this

juncture on the question whether either of those

exceptions--particularly the majority support

requirement, given the fact that there is now

another union representing these guards--might

defeat the Union’s claim here. Questions like

that are best left to the Board’s consideration

on remand.

Other courts have accepted the Act’s balancing

of section 9(b) interests with the general

policies of the Act, refusing to create

exceptions to section 8(b)(5) based on concerns

dealt with elsewhere in the Act. See, e.g.,

International Tel. & Tel. Corp. v. NLRB, 382 F.2d

366, 369-71 (3d Cir. 1967) (finding that a mixed

unit of professional and non-professional

employees, though frowned upon within section 9

of the Act, was still protected by section

8(a)(5)’s bargaining requirement). We similarly

decline to create an exception to the application

of section 8(b)(5) for mixed unions./1

The Union’s petition to set aside the decision

of the National Labor Relations Board is Granted,

and the case is Remanded for consideration of the

Union’s section 8 claims.

/1 Because our decision disagrees with that of the

Second Circuit in Truck Drivers Local Union No.

807 v. NLRB, 755 F.2d 5 (2d Cir. 1985), this

opinion has been circulated to all judges in

active service under Circuit Rule 40(e). A

majority of the judges voted against hearing this

case en banc; Judge Ripple voted to hear the case

en banc.