Laurel Bay Health & Rehabilitation Center v. National Labor Relations Board

United States Court of Appeals

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued November 9, 2011 Decided January 20, 2012

No. 10-1340

LAUREL BAY HEALTH & REHABILITATION CENTER,

PETITIONER

v.

NATIONAL LABOR RELATIONS BOARD,

RESPONDENT

Consolidated with 10-1405

On Petition for Review and Cross-Application for

Enforcement of an Order of the National Labor Relations

Board

David F. Jasinski argued the cause for the petitioner.

Zachary R. Henige, Attorney, National Labor Relations

Board, argued the cause for the respondent. John H. Ferguson,

Associate General Counsel, Linda Dreeben, Deputy Associate

General Counsel, Jill A. Griffin, Supervisory Attorney, and

Richard A. Cohen, Attorney, were on brief.

Before: HENDERSON, BROWN and GRIFFITH, Circuit Judges.

Opinion for the Court filed by Circuit Judge HENDERSON.

2

KAREN LECRAFT HENDERSON, Circuit Judge: Petitioner

Laurel Bay Health and Rehabilitation Center (Laurel Bay) seeks

review of a decision of the National Labor Relations Board

(NLRB, Board) affirming the findings of an administrative law

judge (ALJ) that Laurel Bay committed eight unfair labor

practices (ULPs) in violation of section 8(a)(1) and (5) of the

National Labor Relations Act (Act), 29 U.S.C. § 158(a)(1), (5).

See Laurel Bay Health & Rehab. Ctr., 353 N.L.R.B. 232, 232

n.3, 39 (ALJ) (2008) (Laurel Bay I), incorporated by reference

in Laurel Bay Health & Rehab. Ctr., 356 N.L.R.B. No. 3, 2010

WL 4227855 (2010) (Laurel Bay II). The Board filed a cross-

application for enforcement. We grant Laurel Bay’s petition in

part and set aside the Board’s findings that Laurel Bay

committed ULPs when it prematurely declared impasse and

unilaterally implemented a wage increase on September 1, 20051

for the reasons set forth below. We deny the petition and grant

enforcement as to the remaining ULP findings because Laurel

Bay has forfeited any objection thereto.2

1

Unless otherwise noted all dates cited are in 2005.

2

The remaining six ULPs are based on allegations that Laurel Bay

(1) unilaterally terminated a nursing assistant’s “accommodation

schedule” that allowed her to work a non-standard shift one day each

week to attend a class; (2) unilaterally announced the termination of

all accommodation schedules; (3) unilaterally terminated a

transportation service it provided for certain nurses’ aides; (4) refused

to meet for bargaining after October 4, 2005; (5) unilaterally

implemented merit pay raises; and (6) failed to provide information

requested by the SEIU 1199 New Jersey Health Care Union (Union)

on August 31, 2005 and thereafter. Laurel Bay forfeited its objections

to the first two alleged ULPs because it failed to except to them before

the Board. See Laurel Bay I, 353 N.L.R.B. at 232 n.1; 29 U.S.C.

§ 160(e) (“No objection that has not been urged before the Board . . .

shall be considered by the court, unless the failure or neglect to urge

such objection shall be excused because of extraordinary

3

I.

Laurel Bay operates a nursing home and rehabilitation

center in Keansburg, New Jersey. From 1999 until 2005, SEIU

1199 New Jersey Health Care Union (Union) represented 82

Laurel Bay employees in a collective bargaining unit consisting

of full-time and regular part-time licensed practical nurses,

nurses aides, recreational aides, beauticians, housekeeping aides,

circumstances.”). Laurel Bay forfeited the third through fifth

objections because it did not provide any legal argument in its opening

brief to support overturning either the third and fourth ULPs or the

fifth ULP insofar as the Board based the fifth ULP on McClatchy

Newspapers, Inc., 321 N.L.R.B. 1386, 1391 (1996). See Laurel Bay

I, 353 N.L.R.B. at 248 (ALJ) (assuming impasse occurred, Laurel Bay

could not lawfully implement discretionary merit pay plan under

McClatchy because “[a]llowing the employer to implement upon

impasse a clause that reserved the right to unilaterally exert unlimited

managerial discretion over future pay increases [‘]would be so

inherently destructive of the fundamental principles of collective

bargaining that it could not be sanctioned as part of a doctrine created

to break impasse and restore active collective bargaining.’ ” (quoting

McClatchy Newspapers, 321 N.L.R.B. at 391)) (quotation mark

omitted); id. at 232 n.3 (adopting ALJ’s “contested findings of

violations”); Laurel Bay II, 2010 WL 4227855, at *1 (incorporating

Laurel Bay I); Dunkin’ Donuts Mid-Atlantic Distrib. Ctr., Inc. v.

NLRB, 363 F.3d 437, 441 (D.C. Cir. 2004) (enforcing rule that

“argument portion of an appellant’s opening brief ‘must contain’ the

‘appellant's contentions and the reasons for them, with citations to the

authorities and parts of the record on which the appellant relies.’ ”

(quoting Fed. R. App. P. 28(a)(9)(A))). Finally, because the “duty to

provide relevant information needed by a labor union for the proper

performance of its duties as the employees’ bargaining representative”

arises from the “duty to bargain collectively,” U.S. Testing Co. v.

NLRB, 160 F.3d 14, 19 (D.C. Cir. 1998) (quotation omitted), we find

the seventh ULP forfeited on the same basis as the fourth. In finding

Laurel Bay forfeited its objections, we express no opinion on the

merits of the alleged ULPs.

4

laundry employees and dietary employees. In early 2005,

Laurel Bay and the Union began negotiating a successor

collective bargaining agreement. Under the previous five-year

agreement, in effect from October 1999 through September

2004, unit members were initially covered under Laurel Bay’s

health insurance plan. In October 2003, however, the parties

entered into an “extension” agreement which extended the

contract through March 2005. In addition, the extension

agreement transferred the unit employees’ health coverage from

Laurel Bay’s employee health insurance plan to the Union’s

SEIU 1199 Greater New York Benefit Fund (Benefit Fund)3 and

required Laurel Bay to contribute a percentage of its gross unit

payroll to the Benefit Fund. The initial contribution was set at

12%, increasing on February 1 to 16% and on April 1 to 18% .4

The parties conducted eight bargaining sessions in 2005 in

an effort to forge a successor collective bargaining agreement.

Laurel Bay was represented primarily by its counsel, David F.

Jasinski, with the assistance of Laurel Bay’s finance director,

David Dennin, and human resources director, Linda Meehan.

The Union was represented by a succession of three individuals:

Uma Pimplaskar, Justin Foley and Larry Alcoff.

Pimplaskar represented the Union at the first two bargaining

sessions. At the first, which took place in February, she

presented Laurel Bay with a contract proposal which, inter alia,

3

The Benefit Fund is managed by a Board of Trustees (Trustees),

half of whom are designated by employers and half by the Union.

Atrium at Princeton, LLC, 353 N.L.R.B. No. 60, 2008 WL 5134010,

at *56 n.10 (2008) (ALJ), adopted by Atrium at Princeton, LLC, 356

N.L.R.B. No. 6, 2010 WL 4318370 (Oct. 22, 2010).

4

The extension agreement also authorized Laurel Bay to hire up

to 25 “no frills” or “per diem” employees, i.e., employees who receive

no benefits under the collective bargaining agreement.

5

provided for increased contributions to the Benefit Fund.5

Under the proposal, beginning May 1, Laurel Bay was to

contribute 21% of gross unit payroll to the Benefit Fund, with

the percentage to be adjusted by the Benefit Fund trustees “as

necessary to maintain the level of benefits currently provided or

as improved by the Trustees during the life of the Agreement”

but “in no event” to exceed 24% of gross unit payroll.6 Resp’t

ex. 1 at 7 (JA 163). According to Jasinski’s uncontradicted

testimony, Pimplaskar told him “there were certain provisions

in their proposals that would not be negotiable, that she would

not even hear any discussions about,” including the Benefit

Fund contribution requirement. Hearing Tr. 436 (JA 120).

Jasinski also testified she told him the Union was then

negotiating 40 to 45 contracts with a group of 20 New Jersey

nursing homes represented by lawyer Morris Tuchman

(Tuchman Group) and any agreement reached with Laurel Bay

would have to be approved by a “master committee” made up of

employees at other facilities. Finally, she requested that Laurel

Bay provide a list of unit employees, their rates of pay, hours

worked and dates of hire.

The parties met for a second session on March 9, at which

time Laurel Bay presented a written counter-proposal addressing

5

The proposal was delivered at least in oral form at the first

session. Jasinski testified he was uncertain whether Pimplaskar

presented the written version at the first or the second session.

6

The proposal also provided that Laurel Bay contribute 2½% of

each unit employee’s gross earnings to the Union’s national pension

fund, ½% to its Training and Education Fund and ½% to the New

Jersey Healthcare Workers Alliance for Quality in Long Term Care.

It also contained provisions addressing non-economic subjects such as

Union activities and communications, seniority, layoff and recall,

transfer and promotion, discipline and discharge and

labor-management committees. It did not include a wage proposal.

6

non-economic issues, including overtime eligibility, part-time

employee criteria and grievance and arbitration procedures.

According to Jasinski, Pimplaskar informed him then that the

Union’s proposal was the “standard contract”—which Jasinski

interpreted to mean the contract then being negotiated with the

Tuchman Group—and that it was the contract the Union was

“going to negotiate” and was “going to get.” Hearing Tr. 445

(JA 123). On March 21, Alcoff notified Jasinski that Foley was

replacing Pimplaskar as chief Union negotiator.

Foley met with the Laurel Bay representatives for the first

time in mid-May. He testified at the ALJ hearing that, during the

2½ hour meeting, the parties merely reviewed outstanding

information requests and proposals that were already “on the

table.” Hearing Tr. 45 (JA 43).

The next meeting, on June 3, lasted about three hours. The

parties again addressed information requests and they discussed

non-economic contract terms but failed to reach any agreement.

They also signed a “memorandum of agreement”—extending

the existing contract through June 30—and scheduled another

bargaining session.

On June 17, Foley met again with the Laurel Bay

negotiating team and tendered a revised economic proposal on

the Union’s behalf. The proposal, inter alia, set a Benefit Fund

contribution rate of 22.33% of gross unit payroll and annual

wage increases of 4%.7 According to Jasinski, Foley stated the

Union could not “deviate” from or “make any changes” to a

7

In addition, the proposal set contribution rates for the other

Union funds, prohibited hiring new “no frills” employees and

established minimum “parity” pay for lower paid employees—

housekeeping and dietary workers, in particular—intended to bring

their pay up to “industry” levels by the contract’s end date. See Resp’t

Br. 8, 14-15.

7

number of provisions in the Tuchman “Master Contract,”8

including the Benefit Fund contribution requirement, because

the Tuchman Master Contract included a “most favored nations”

clause requiring any concession the Union granted Laurel Bay

it “would have had to give [] to everyone else.” Hearing Tr. 452

(JA 124). Thus, according to Foley, the Union’s hands were

“tied.” Id.9 According to Dennin’s testimony, Foley said the

22.33% Benefit Fund contribution in particular was “set in

stone.” Hearing Tr. 549 (JA 147).

When the negotiators met again on July 8, Jasinski

presented Foley with Laurel Bay’s own economic proposal,

proposing a Benefit Fund contribution of 16% of gross unit

payroll (through the entire contract term), wage increases of 3%

in October 2005 and October 2006 and 2% in April 2007 and

October 2007 and an annual discretionary “merit bonus or merit

8

The Tuchman Master Contract was the final negotiated three-

year contract agreed to by the Union and the 20 facilities in the

Tuchman Group. It took effect on June 15, 2005.

9

The Tuchman Master Contract contained the following relevant

most favored nations language:

In the event the Union enters into any collective bargaining

agreement . . . on or after April 1, 2005 with a proprietary

nursing home in New Jersey which provides for more

favorable economic terms and conditions to the employer

than those contained herein, such more favorable terms and

conditions shall automatically be applicable to the

Employers [signatory to the Tuchman Master Contract] . . . .

Resp’t ex. 23 at 29, art. 35, ¶ 35.2 (JA 251) (agreement between SEIU

1199 New Jersey Health Care Union and Arnold Walter Nursing

Home et al.).

8

pay” plan.10 Foley testified they did reach agreement on some

non-economic issues but not on the key economic points.

According to Dennin, Foley was “adamant” about the 22.33%

Benefit Fund contribution because “that is what he [had] gotten

at other facilities and that is what he w[ould] get at all of his

facilities.” Hearing Tr. 552 (JA 147). According to Dennin,

Jasinski responded: “Laurel Bay is Laurel Bay and he didn’t

care what [Foley] negotiated with other owners at other

facilities.” They scheduled another session for July 16 which

Foley subsequently cancelled because by then he had left the

local Union’s employ. Foley’s notes written after the July 8

meeting indicated Laurel Bay did not “seem to be making any

money” and quoted Jasinski as calling Laurel Bay “broke”

because its resident census was low at only 70%. Resp’t ex. 18

(JA 214).

On August 5, the negotiators convened again after Alcoff

replaced Foley as the Union’s chief negotiator. During the

session, Alcoff and Jasinski reached a tentative agreement on a

number of non-economic issues. In addition, Alcoff presented

a written counter offer of economic proposals, which again set

a Benefit Fund contribution rate of 22.33% but with the

additional proviso that, if 22.33% was insufficient to cover

costs, the parties would meet and either adjust benefits or make

other revisions (with final and binding arbitration in the event

they could not agree). “In no event,” however, could “the

contribution requirement of the Employer exceed 22.33% of

gross payroll . . . except by mutual agreement.” Gen. Counsel

ex. 7, art. 31, ¶ 31.1 (JA 415). The ALJ found the counter

10

Laurel Bay also proposed new criteria for setting new hires’

wages, new hourly rates for no-frills employees and little or no change

in sick/holiday/vacation days.

9

offer’s Benefit Fund provision and certain other terms11 were

“identical” or “virtually” so to those in the Tuchman Master

Contract. Laurel Bay I, 353 N.L.R.B. at 237. According to

Jasinski, Alcoff told him the Union was “going to get the

Tuc[h]man contract” and relied on that contract’s most favored

nations clause to justify the Union’s refusal to consider other

proposals. Hearing Tr. 469 (JA 129); see also id. at 474 (JA

130) (Alcoff “kept on referring to [the Union’s] desires to

negotiate the standard agreement”). Alcoff acknowledged that,

although there were some facility-specific variations in the

Tuchman Master Contract, all 20 of the signatory employers

were required to make a Benefit Fund contribution of 22.33%.

According to Dennin, both he and Jasinski responded that the

proposed rates were “too much” and “too high” because of

Laurel Bay’s “very low” census, with 23 of its 123 beds then

empty. Hearing Tr. 553-54 (JA 148).

The parties held their final bargaining session on August 23.

At that time, Laurel Bay orally modified its July 8 proposal,

moving the October 1, 2005 3% wage increase up to August 14.

Alcoff testified that they had “a back and forth discussion,

briefly, on the health insurance, again” during which Dennin

stated he “didn’t want to pay any more than he was currently

paying for health insurance, and with the raises on the table, 16

percent of a higher gross payroll would equal his current 18

percent of a lower gross payroll pre-raises.” Hearing Tr. 154

(JA 68). Alcoff responded that Dennin’s suggestion was “not

going to be possible” and that there was “no way that they were

going to be able to stay in the [Benefit Fund] at the rate that they

were proposing.” Hearing Tr. 154, 186 (JA 68, 76). Alcoff

stated that he asked Jasinski what he would do if the Benefit

Fund rejected Laurel Bay’s 16% contribution offer and Jasinski

11

These included the proposal’s no-frills employee and wage

increase terms.

10

replied that “that was [Alcoff’s] problem.” Id. at 187 (JA 76).

Alcoff added that if Laurel Bay was unwilling to pay any more

than the amount it offered, the Union “had to look for other

health insurance.” Hearing Tr. 154 (JA 68). According to

Alcoff’s testimony, Alcoff asked Jasinski: “What do you offer

the non-Union employees?” Hearing Tr. 86-87 (JA 76)—and

suggested the negotiators “ought to look at other plans.”

Hearing Tr. 187 (JA 76).

At Alcoff’s suggestion, he and a Laurel Bay unit employee

joined Jasinski and Dennin in Laurel Bay’s caucus room for an

“off-the-record discussion,” which Alcoff characterized as

“very, very unproductive.” Hearing Tr. 155-56 (JA 68). After

Alcoff and the employee returned to the bargaining room,

Jasinski joined them and declared that Laurel Bay’s outstanding

July 8 offer (as orally amended to accelerate the first pay raise)

was Laurel Bay’s “last and best final offer.” Hearing Tr. 476

(JA 130); see also id. at Tr. 157 (JA 69); 353 N.L.R.B. at 239,

241. Alcoff testified he expressed surprise because they had had

“virtually no discussion on economic issues.” Hearing Tr. 158

(JA 69). He then questioned Jasinski at length about Laurel

Bay’s other contract proposals—how they might be applied and

how much money they would save Laurel Bay. In conclusion,

Alcoff testified, he said to Jasinski:

I will tell you that we are not at impasse in this

discussion. There’s wiggle room on the proposal. But,

clearly, we need to know a lot of answers to these

kinds of questions, now that we’re apparently

surprisingly at the end of bargaining, out of the blue.

. . . [W]e would like to schedule another session. We

will need information, because, frankly, we need to

know in real terms what the impact of this will be both

on our members and to the employer, so we can cost it

out against our proposal and make a comprehensive

counter-proposal.

11

Hearing Tr. 169 (JA 72). Jasinski responded he did not have his

calendar with him to schedule another session but would call the

Union local later to do so.

On August 31, Alcoff wrote Jasinski that he was “preparing

a comprehensive counterproposal on the remaining open issues”

and requested information, including the summary plan

descriptions of Laurel Bay’s non-unit employee health plans and

the amounts of their premiums (for employer and employee).

Gen. Counsel ex. 8 (JA 417). The next day, September 1, Laurel

Bay implemented a 3% pay raise in accord with its July 8,

economic proposal, as amended on August 23 (accelerating the

date of the raise). Alcoff immediately sent a fax to Jasinski

expressing “shock[]” that Laurel Bay unilaterally implemented

the increase, asking if Laurel Bay had implemented any other

provisions in its proposal and declaring: “We are clearly not at

impasse.” Gen. Counsel ex. 9 (JA 418). The two exchanged

correspondence regarding possible meeting dates until January

2007 but did not meet again. In his final letter, dated January

10, 2007, Alcoff complained that Laurel Bay “unilaterally

implemented a ‘merit bonus’ for bargaining unit employees in

December 2006,” which it apparently had done. Gen. Counsel

ex. 24 at 1 (JA 434).

The Union filed a series of unfair labor practice charges

against Laurel Bay from November 2005 to May 2006. On

February 2, 2007, the Board’s General Counsel filed a Third

Amended Consolidated Complaint alleging Laurel Bay violated

section 8(a)(5) and (1) of the Act by failing to provide the Union

with requested information, refusing to meet for bargaining at

reasonable times and unilaterally implementing changes in terms

of employment without first bargaining to impasse.12 The ALJ

conducted a hearing in February-March 2007.

12

For a list of the unilateral changes other than the wage increase,

see supra p. 2 note 2.

12

In his June 8, 2007 decision, the ALJ concluded Laurel Bay

violated section 8(a)(1) and (5) in all respects alleged based on

two alternate rationales. First, the ALJ concluded that there was

no impasse, relying on Alcoff’s conduct at the final bargaining

session both before Jasinski declared Laurel Bay’s latest offer to

be its “last and best final offer”—when Alcoff mentioned “other

health insurance” and Laurel Bay’s “non-Union employees,”

Hearing Tr. 154, 186-87 (JA 68, 76); and after Jasinski’s

declaration—when Alcoff questioned him about the terms of

Laurel Bay’s offer, denied there was an impasse, claimed there

was “wiggle room on the proposal” and expressed a desire to

schedule another bargaining session so the Union could make

“a comprehensive counter-proposal,” id. at 169 (JA 72). Laurel

Bay I, 353 N.L.R.B. at 245. Alternatively, the ALJ reasoned

that if there was an impasse, it was broken by the discourse

following Jasinski’s declaration, id. at 247. In either event, he

concluded, Laurel Bay violated the Act when it unilaterally

implemented the various changes in the absence of an impasse.

He further concluded Laurel Bay unlawfully refused to supply

requested information after the last session or to meet for further

bargaining.

In a decision filed September 30, 2008, a two-member panel

of the NLRB upheld the ALJ, finding that “the parties had not

reached an impasse in bargaining, and that [Laurel Bay] violated

Section 8(a)(5) when it unilaterally implemented various

changes in the employees’ terms and conditions of

employment.” 353 N.L.R.B. at 233. The Board explained:

Rather than evincing the existence of a bona fide

impasse over health insurance as of August 23, the

record shows that the parties had agreed to meet again,

that the Union would be preparing counterproposals,

and that there was at least professed flexibility on

health insurance alternatives.

13

Id. Laurel Bay petitioned for review. We held the case in

abeyance pending the United States Supreme Court’s decision

in New Process Steel, L.P. v. NLRB, cert. granted, 130 S. Ct.

488 (2009). On June 17, 2010, the Supreme Court issued its

decision in New Process Steel, 130 S. Ct. 2635 (2010), holding

that a two-member panel of the Board lacks statutory authority

to act on the Board’s behalf. Accordingly, on September 20,

2010, we granted the petition for review, vacated the Board’s

decision and “remanded for further proceedings before the

Board.” Laurel Bay Health & Rehab. Ctr. v. NLRB, No. 08-

1337 (D.C. Cir. Sept. 20, 2010).

On remand, a three-member panel of the Board succinctly

decided:

The Board has considered the judge’s decision and

the record in light of the exceptions and brief and has

decided to affirm the judge’s rulings, findings, and

conclusions and to adopt the recommended Order to

the extent and for the reasons stated in the decision

reported at 353 NLRB 232, which is incorporated

herein by reference.

Laurel Bay II, 2010 WL 4227855, at *1 (Oct. 15, 2010). Laurel

Bay filed a timely petition for review and the Board filed a

cross-application for enforcement.

II.

Section 8(a)(5) makes it an ULP for an employer “to refuse

to bargain collectively with the representatives of his

employees.” 29 U.S.C. § 158(a)(5). “An employer violates this

duty to bargain if, absent a final agreement or a bargaining

impasse, he unilaterally imposes changes in the terms and

conditions of employment.” TruServ Corp. v. NLRB, 254 F.3d

1105, 1113 (D.C. Cir. 2001). In this case, we believe the Board

erred in upholding the ALJ’s finding that the parties were not at

impasse when Jasinski presented Laurel Bay’s “last and best

14

final offer” on August 23. Further, we conclude the Board also

erred in finding Laurel Bay committed an ULP when it

subsequently implemented its proposed 3% pay raise on

September 1.

“A bargaining impasse—which justifies an employer’s

unilateral implementation of new terms and conditions of

employment—occurs when ‘good faith negotiations have

exhausted the prospects of concluding an agreement’ leading

both parties to believe that they are ‘at the end of their rope.’ ”

Id. at 1114 (quoting Taft Broad. Co., 163 N.L.R.B. 475, 478

(1967); PRC Recording Co., 280 N.L.R.B. 615, 635 (1986)).

“Among the factors that the Board considers in evaluating the

existence of an impasse are ‘the bargaining history, the good

faith of the parties in negotiations, the length of the negotiations,

the importance of the issue or issues as to which there is

disagreement, [and] the contemporaneous understanding of the

parties as to the state of negotiations.’ ” Id. (quoting Taft, 163

N.L.R.B. at 478). “After weighing these factors, the Board will

find an impasse if there is ‘no realistic possibility that

continuation of discussions . . . would have been fruitful.’ ” Id.

(quoting Am. Fed’n of Television & Radio Artists v. NLRB, 395

F.2d 622, 628 (D.C. Cir. 1968)). Such is the case here.

From start to finish, the parties were at loggerheads over the

amount of Laurel Bay’s contribution to the Benefit Fund. As the

ALJ found, their “course of bargaining demonstrates that the

Union never proposed a Benefit Fund increase which was lower

than the raise ultimately agreed to in the Tuchman

agreement—22.33%, and [Laurel Bay] consistently insisted that

it would not agree to a higher rate than its offer of 16%.” 353

N.L.R.B. at 245 (footnote omitted). Thus, as the ALJ

acknowledged, when the parties entered the final bargaining

session on August 23, “all the elements of a genuine impasse in

bargaining were in place.” Id. at 246. And so it played out.

Dennin and Jasinski repeated their insistence on a contribution

15

rate of 16% and Alcoff responded it was “not going to be

possible” and there was “no way” Laurel Bay could remain in

the Union’s Benefit Fund at that rate. Hearing Tr. 154, 186 (JA

68, 76). And neither party budged before Jasinski, upon his

return from the caucus room, unequivocally declared Laurel

Bay’s existing proposal—including the 16% contribution

rate—to be its last, best and final offer. At this point, the seeds

of impasse had come to fruition.

On review, the NLRB acknowledged that “[i]mpasse over

a single issue may create an overall bargaining impasse that

privileges unilateral action if the issue is ‘of such overriding

importance’ that it frustrates the progress of further

negotiations” and that “the Benefit Fund contributions clearly

constituted such an issue.” 353 N.L.R.B. at 232-33 (quoting

CalMat Co., 331 N.L.R.B. 1084, 1097 (2000)). The Board

further recognized that “throughout most of the negotiation

sessions, the parties remained steadfastly fixed in their

respective positions: the Union adhering to the Tuchman

agreement terms, and the Respondent refusing to contribute

more than 16 percent of payroll” and that “[h]ad that status quo

persisted, an overall impasse might well have been achieved.”

Id. at 233. But the Board found that the status quo “did not

persist,” id.—a finding we cannot uphold because it is not

supported by substantial evidence. See TruServ, 254 F.3d at

1115 (“court ordinarily defers to the Board’s fact-finding as to

the existence of a bargaining impasse,” but “court must be

satisfied that the Board’s findings are supported by substantial

evidence on the record considered as a whole”).

In TruServ, the employer too made a “last, best and final

offer” but the Board concluded “the parties had not bargained to

impasse before the [employer] unilaterally implemented changes

in the unit employees’ terms and conditions of employment”

because “until the [employer] abruptly claimed that its ‘last, best

and final offer’ was on the table and would be implemented

16

unilaterally if not accepted, both the [employer] and the Union

had demonstrated considerable flexibility and willingness to

compromise their positions.” 254 F.3d at 1114 (quotation marks

omitted). The employer petitioned the court for review and we

granted the petition as to the impasse finding. We concluded

that “nothing in the record negate[d] [the employer’s]

classification of its [] proposal as its ‘last, best, and final

offer.’ ” Id. at 1115. Similarly here—after six months of

negotiation—the parties in August 2005 remained as far apart on

the Benefit Fund contribution issue as they were when talks

began in February.

At oral argument, the Board’s counsel argued at length that

the “context” of the final August 23 meeting—i.e., the entire

course of the parties’ bargaining—reinforced that the parties

were not at impasse. This argument runs contrary to both the

ALJ’s and the Board’s characterizations of the parties’ consistent

adherence to their respective positions on the Benefit Fund

contribution up to the August 23 session, when, as both the ALJ

and the Board acknowledged, the parties were poised for

impasse. See 353 N.L.R.B. at 233 (Board); id. at 245 (ALJ). In

finding no impasse, the Board largely ignored the parties’

bargaining history and focused instead on their post-impasse

conduct—what the Union did and what Laurel Bay did not.13 On

13

The Board largely ignored the four Taft factors, supra p. 14,

relying on only one—the contemporaneous understanding of the

parties—and that only briefly. See 353 N.L.R.B. at 245-46. Yet

Jasinski’s declaration of Laurel Bay’s last, best and final offer and

Alcoff’s rejection of the offer show that their contemporaneous

understanding practically shouted impasse. TruServ, 254 F.3d at 1117.

Nor does Alcoff’s denial of impasse belie such an understanding. See

id. (“[A] bald statement of disagreement by one party to the

negotiations is insufficient to defeat an impasse. A contrary result

would render the ‘contemporaneous understanding’ Taft factor

meaningless.”).

17

the Union’s part, the Board pointed to Alcoff’s statements that

“the Union was prepared to consider alternative medical

insurance proposals, including the health care plan covering

[Laurel Bay]’s nonunion employees” and that “the Union would

be preparing a counterproposal.” 353 N.L.R.B. at 233. To the

extent a proposal may be inferred from Alcoff’s vague comments

before Jasinski declared Laurel Bay’s “last and best final offer,”

—suggesting the parties might have to “look for other health

insurance” and asking about health plans offered “non-Union

employees,” Hearing Tr. 154, 186-87 (JA 68, 76)—it was

emphatically rejected by Jasinski’s declaration. And his post-

declaration statements simply came too late, after impasse had

already been reached.14 In any event, “ ‘[t]he Board itself has

indicated that a party’s “bare assertions of flexibility on open

issues and its generalized promises of new proposals [do not

clearly establish] any change, much less a substantial change” in

that party’s negotiation position.’ ” TruServ, 254 F.3d at 1117

(quoting Serramonte Oldsmobile, Inc. v. NLRB, 86 F.3d 227, 233

(D.C. Cir. 1996) (quoting Civic Motor Inns, 300 N.L.R.B. 774,

776 (1990))) (brackets in TruServ). Here, Alcoff’s twelfth-hour

protestations and posturing did nothing to negate the culmination

in impasse of 6 months’ fruitless bargaining. See id.

(“Furthermore, the Union’s ‘conduct’ on which the Board

relies—the Union’s self-serving statement . . . that the parties

were not at impasse and the Union’s vacuous request . . . for

14

Although the ALJ found that if there was an impasse, it was

subsequently broken by Alcoff’s near-soliloquy, Laurel Bay I, 353

N.L.R.B. at 245, the Board appears not to have adopted the finding.

See id. at 232 (“For the reasons set forth below, we agree with the

judge that [Laurel Bay] violated Section 8(a)(5) and (1) of the Act by

prematurely declaring impasse and unilaterally implementing certain

changes to its employees’ terms and conditions of employment.”

(emphasis added)). In any event, the Board does not rely on the

broken impasse rationale now.

18

additional meetings—is insufficient to demonstrate the Union’s

desire to pursue further negotiations.”). They did not “actually

commit[] the Union to a new position or contain[] any specific

proposals.” Serramonte, 86 F.3d at 233. In total, they “offer

about as much as a handful of air” to support the Board’s finding

of no impasse. Id. There is no suggestion in the record that

Laurel Bay was willing to retreat from its consistent insistence

on a 16% contribution rate or that the Union would move toward

it. See TruServ, 254 F.3d at 1116 (“In short, the parties remain

in control of their negotiations, and each party, not the Board,

determines at what point it ceases to be willing to

compromise.”). There was no movement at all here—merely the

persisting status quo.15

As for Laurel Bay, the Board faults it for failing to “test the

Union’s stated willingness to move, consider a union

counterproposal, or follow through with an additional negotiation

session” and the “sincerity” of its “professed flexibility on health

insurance alternatives.” 353 N.L.R.B. at 233. We rejected just

such a requirement, however, in Serramonte. There, the ALJ

“placed the burden on [the employer] to ‘contemplate whether

the Union was reconsidering’ ” by “probing [its] frankness.” 86

F.3d at 233 (quoting Serramonte Oldsmobile, Inc., 318 N.L.R.B.

15

Nor is the Board’s finding of no impasse supported, as it claims,

by “evidence at the hearing establish[ing] that the Union, in fact,

agreed to contracts with six other nursing homes in New Jersey that

did not include the Benefit Fund as the insurance plan for unit

employees.” Laurel Bay I, 353 N.L.R.B. at 233; see, e.g., Resp’t ex.

23 at 67 (JA 289) (arbitral award in New Vista Nursing & Rehab.

Ctr.). Such post hoc evidence sheds no light on the

“ ‘contemporaneous understanding of the parties as to the state of

negotiations’ ” at the August 23, 2005 bargaining session. Taft, 163

N.L.R.B. at 478 (emphasis added). Moreover, the parties here never

agreed to consider other plans nor was there any movement on the

contribution rate.

19

80, 97 (1995)). We found the Board’s approach “reflect[ed] a

clear misunderstanding of the relevant inquiry” because “there

is absolutely no basis for requiring a negotiating party to probe

the sincerity of another party’s contentless statements after an

impasse has already been reached.” Id. Yet this is exactly the

burden the Board once again imposed in this case. And just as

wrongly. Once Jasinski made his declaration and impasse was

reached, the burden lay on the Union to show “changed

circumstances.” See id. at 233 (“[I]t is incumbent on the party

asserting that the impasse has been broken to point to the

changed circumstances that would justify such a finding.”). The

Union did not meet its burden when it failed to produce

substantial evidence of such a change.16

16

In a post-argument letter submitted pursuant to District of

Columbia Circuit Rule 28(j), the Board asserts its impasse finding is

supported by the court’s recent decision in Wayneview Care Center v.

NLRB, Nos. 10-1398 et seq. (D.C. Cir. Dec. 23, 2011). The Board

contends that here, as in Wayneview, “the Union . . . let go of its

demand that the employer[] participate in the Union’s health insurance

plan” and the court should therefore uphold the Board’s finding that,

like the employers in Wayneview, Laurel Bay “did not bargain to a

good-faith impasse.” Rule 28(j) letter at 1 (filed Dec. 28, 2011). The

parties’ bargaining posture in Wayneview, however, was manifestly

different. At the time of the alleged impasse in Wayneview, the union

had made “major concessions” on what the employers asserted were

the “two principal stumbling blocks in the way of a collective

bargaining agreement”: the union’s proposal to reduce the number of

“no-frills” employees and its insistence on a 22.33% contribution to

the Benefit Fund. Wayneview, slip op. at 10, 3. The union had, as we

observed, “softened its position on the specific items that [the

employers] had identified as the major obstacles to an agreement.” Id.

at 4. The employers had likewise made “significant concessions”

before they abruptly, with no explanation, presented “a regressive

proposal—which they later claimed to be their ‘last best offer.’ ” Id.

Under these facts, we upheld the Board’s determination that “[t]he

parties’ contemporaneous understanding of the negotiations was that

20

For the foregoing reasons, we conclude the record

establishes the parties reached an impasse during the August 23,

2005 bargaining session. Accordingly, we grant Laurel Bay’s

petition for review regarding the Board’s findings that Laurel

Bay committed unfair labor practices in violation of section

8(a)(1) and (5) of the National Labor Relations Act when it

declared impasse and when it subsequently implemented the

proposed wage increase; accordingly, we vacate the Board’s

order insofar as it found Laurel Bay’s implementation of the pay

raise constituted an unfair labor practice. In all other respects,

the petition is denied and the cross-application for enforcement

is granted.17

So ordered.

further bargaining would be fruitful” and that the employers therefore

“ ‘failed to prove that the parties reached impasse.’ ” Id. at 10

(quoting Wayneview Care Ctr., 352 N.L.R.B. 1089, 1089 (2008)).

Here, by contrast, when Jasinski declared on August 23 that Laurel

Bay’s outstanding July 8 offer was its “last and best final offer,” the

parties had not once come even close to accord on the major sticking

point—the contribution rate—nor did Laurel Bay renege on any of the

agreed upon terms much less make a regressive offer. The parties’

“contemporaneous understanding” was, in short, one of impasse. See

supra p. 16 note 13.

17

See supra p. 2 note 2.