Local 259, United Automobile, Aerospace and Agricultural Implement Workers of America v. National Labor Relations Board

IRVING R. KAUFMAN, Circuit Judge

(dissenting):

Professor Llewellyn has noted that “even an appellate court officially concerned with rules alone has been known repeatedly to strain itself and to strain the rules that it laid down in order to produce what seemed a just result in the case at hand.” K. Llewellyn, The Bramble Bush 39 (1960). The majority opinion articulates the factual basis for its conclusion. A struggling employer acted in good faith and made a fair offer, but the Union “was of another mind.” Ergo, the majority concludes the employer should not be punished. In reaching this result, however, my colleagues ignore firmly established tenets of labor law. Accordingly, I respectfully dissent.

In NLRB v. Crompton-Highland Mills, Inc., 337 U.S. 217, 225 , 69 S.Ct. 960, 964 , 93 L.Ed. 1320 (1949), the Supreme Court held it an unfair labor practice for an employer unilaterally to offer terms “substantially different from, or greater than” those offered in negotiations with the authorized representative. The Court subsequently strengthened this rule by making any disparate offer a per se violation of § 8(a)(5), regardless of the employer’s good faith. NLRB v. Katz, 369 U.S. 736, 742-43 , 82 S.Ct. 1107, 1111 , 8 L.Ed.2d 230 (1962).

As the administrative law judge found, it takes a “leap of faith” to view the offer given to the replacement workers as comprehended within Brady-Stannard’s highest final offer to its own employees. The hourly wage of $9.75 was an increase of 4.2%, and the guarantee constituted a substantial gain of 10.2%. Moreover, the Union might have agreed to eliminate the Chilton Book in exchange for the higher rate and guarantee. Administrative Law Judge Pacht found without contravention that the parties bargained over the guarantee as a separate item. Admittedly, however, the Union’s response must be left to the realm of conjecture, for the employer never presented this package at the bargaining table.

To prove the replacement terms were less attractive than those contained in the current contract, the majority now proffers a pat mathematical calculation. Because the earnings could “vary significantly,” the Board specifically declined to predicate its decision on the terms of “the formula used for determining wages.” Rather, the Board expressly adopted the employer’s post hoc standard. The replacements’ compensation, reasoned the Board, was comprehended within the final offer because the new workers in fact earned less over a six month period. Local 259, of course, would have compared the surface attractiveness of the new compensation scheme with the loss of the Chilton Book benefits. Blessed with the clarity of hindsight, the Board has seen fit to override the administrative law judge and to declare the unilateral terms less attractive.

After-the-fact approbation cannot be squared with judicial enforcement of a duty to bargain in good faith. The mandate of § 8(a)(5) was never intended to obtain just results or blunt the economic weapons of the parties, but to insure the recognition of the authorized representative. See Cox, *30 The Duty to Bargain in Good Faith, 71 Harv.L.Rev. 1401 (1958). All that was required of the employer was that it submit its latest offer to the bargaining agent. If rejected, Brady-Stannard would have been free to implement it unilaterally. By allowing the employer to juggle the various elements of compensation, however, the Board in effect authorizes an employer to bypass the Union. The Board’s decision therefore condones management behavior akin to the “take-it-or-leave-it” approach eschewed by this Court in NLRB v. General Electric Co., 418 F.2d 736 (2d Cir.1969), cert. denied, 397 U.S. 965 , 90 S.Ct. 995 , 25 L.Ed.2d 257 (1970).

Post hoc justification metamorphosizes the stringent legal standard of Katz into a nebulous factual determination. Although I do not question Brady-Stannard’s good faith, this approach will inevitably benefit unscrupulous employers determined to shunt aside the authorized representative. However alluring the terms offered to new workers, employers can now hope the Board will, for whatever reason, later find them acceptable, even in the face of an adverse ruling by the administrative law judge. Indeed, the possible dangers are clear in this case. The Board concluded the replacement workers earned less “because the number of hours paid was no longer calculated on the Chilton Book.” (emphasis added) This conclusion is highly suspect. As the administrative law judge noted, numerous other factors could have accounted for the decrease, such as a dip in business and the unfamiliarity of the new workers with the shop. Nonétheless, the Board’s determination is protected by the stringent standards of review accorded its decisions.

The true ratio decidendi of this case is relegated to the footnote. Rather than bestow on the strikers the perceived windfall of backpay and reinstatement, my colleagues deny an unfair labor practice occurred at all. Like Administrative Law Judge Pacht and dissenting Board Member Dennis, I believe the resulting rule of decision is antithetical to enforcement of a duty to bargain. We must all subordinate our personal views on labor relations if we are to maintain the importance the law attaches to the bargaining process. Accordingly, I would grant Local 259’s petition.