# Opposition Brief — Houston Building Service, Inc. v. National Labor Relations Board > Briefs, arguments, decisions, and more. URL: https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385009_2849%3A3 ## Record - **Collection:** Supreme Court brief - **Document type:** Opposition Brief - **Published:** January 1, 1992 - **Citation:** 502 U.S. 1090 ## Text ~~ ~ St L No. 91-597 | JAN TS 1992 OFFICE GF ThE CLERK Iu the Supreme Court of the United eri Tes OCTOBER TERM, 1991 HOUSTON BUILDING SERVICE, INC., PETITIONER v. NATIONAL LABOR RELATIONS BOARD ON PETITION FOR A WRIT OF CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE FIFTH CIRCUIT BRIEF FOR THE NATIONAL LABOR RELATIONS BOARD IN OPPOSITION KENNETH W. STARR Solicitor General Department of Justice Washington, D.C. 20530 202) 514-2217 JERRY M. HUNTER General Counsel D. RANDALL FRYE Acting Deputy Generai Counsel NORTON J. COME Deputy Associate General Counsel LINDA SHER Assistant General Counsel National Labor Relations Board Washington, D.C. 20570 QUESTION PRESENTED Whether the National Labor Relations Board prop- erly found that petitioner was a successor employer. (1) TABLE OF CONTENTS Page NN En catctceenonresaeeeseveunnudaiuees Lereeoniouneele 1 I et shevaivencnuunassokecabenammentecvectnpnantatt 1 IE <2 Os oecosndacnasiainsodosinnecebuatammrenenencunventiens 2 te ona pebeghcamsownc sos celpivniasnbnnteekaiberiatrahe 6 aE ETI a oo ES RES OO NR OER IER MRD OLN Se 10 TABLE OF AUTHORITIES Cases: California vV. FERC, i110 8. Ct. 2024 (1990) _... os 8 Fall River Dyeing & Finishing Corp. v. NLRB, ee gc adap anconwhicalenaenenenanee 5, 8,9 Golden State Bottling Co. v. NLRB, 414 U.S. 168 ns cisemnanaenens 9 Hilton v. South Carolina Public Railways Comm’n, No. 90-848 (Dec. 16, 1991) .................................... 8 NLRB v. Burns Int'l Security Services, Inc., 406 I a astensdioereneios 5, 6,7 Square D Co. v. Niagara Frontier Traffic Bureau, Se iS | enna eee 8 Universal Camera Corp. Vv. NLRB, 340 U.S. 474 (8 es hn ee RRC Rae Se ital aie enna ee 9 Statutes: National Labor Relations Act, 29 U.S.C. 151 et seq.: TS EN SIRI URI anette yA cae RAB at 5 Deny eae, oe Ue. 1001R) (2)... 8 4,5 § 8(a) (5), 29 U.S.C. 158 (a) (5) .................... aah a (IIT) In the Siaygreme Court of the United States OCTOBER TERM, 1991 No. 91-597 HOUSTON BUILDING SERVICE, INC., PETITIONER wv: NATIONAL LABOR RELATIONS BOARD ON PETITION FOR A WRIT OF CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE FIFTH CIRCUIT BRIEF FOR THE NATIONAL LABOR RELATIONS BOARD IN OPPOSITION OPINIONS BELOW The opinion of the court of appeals (Pet. App. la- 6a) is reported at 936 F.2d 178. The decision and order of the National Labor Relations Board (Pet. App. 7a-48a) is reported at 296 N.L.R.B. No. 101. JURISDICTION The judgment of the court of appeals was entered on July 2, 1991. The petition for a writ of certiorari was filed on September 30, 1991. The jurisdiction of this Court is invoked under 28 U.S.C. 1254(1). (1) 2 STATEMENT 1. In 1980, the Unlicensed Division of District No. 1, MEBA,-NMU, AFL-CIO (Union) became the recognized collective bargaining representative of a unit of approximately 30 custodial services employees working for Nash Janitorial Services, Inc. (Nash). Nash provided janitorial services for the General Services Administration (GSA) at three federal buildings in Austin, Texas. Pet. App. 12a-ld4a. The service contract was periodically rebid. Between 1980 and 1987, five successive employers assumed responsi- bility for providing janitorial services for GSA. Each hired the employees of its predecessor and maintained a collective bargaining relationship with the Union. Id. at 14a-15a. The last contractor prior to petitioner, Housekeepers Maintenance Service and Supply, Inc. (Housekeepers), had a collective bargaining agree- ment with the Union effective August 1986 through October 1989. /d. at 15a. In 1987, GSA solicited bids for the custodial con- tract. Pet. App. 15a. Petitioner was the successful bidder. /d. at 18a. Before winning the bid, a repre- sentative of petitioner solicited and received from the Union the current collective bargaining agreement and an employee seniority list. 7d. at 15a-16a. Peti- tioner’s president, Jason Yoo, also discussed with Eugene Darby, the janitorial services manager for Housekeepers, the possibility of retaining Darby if petitioner were awarded the contract. Jd. at 16a. Yvo mentioned to Darby that he desired to hire new em- ployees. Darby told Yoo that it could take up to a month to obtain the security clearances needed.’ Yoo 1To be employed in the federal buildings in Austin, each employee required a security clearance. Pet. App. 16a n.8. 3 believed that the clearances could be obtained more quickly. /d. at 16a & n.8. Petitioner’s contract obligations commenced on De- cember 1, 1987. On November 25, petitioner made conditional job offers to 18 individuals, not members of the Housekeepers workforce, to work at the federal buildings, contingent on their obtaining the required security clearances. Some of those applicants failed to receive clearances and were never hired by peti- tioner to work at the federal buildings. Pet. App. 17a-18a & n.11. On December 1, when petitioner be- gan performing the janitorial services contract, its entire rank-and-file workforce consisted of the 30 former Housekeepers employees. Darby, as well as two other former Housekeepers supervisors, also were hired by petitioner. /d. at 19a. On December 2 or 3, Darby distributed job applica- tion forms to the former Housekeepers employees, as wel] as union authorization forms. The employees completed and returned the forms. Pet. App. 19a. Petitioner began to add new employees as they re- ceived security clearances. The former Housekeepers employees, however, constituted a majority of its workforce.” Jd. at 30a-31la. On December 9, petitioner refused the Union’s re- quest for recognition and notified GSA that it in- tended to subcontract its custodial work. Pet. App. 2 One new employee and two new supervisors began work- ing on December 3 and 4. During the week of December 6 through 12, petitioner’s maximum employee complement in- cluded the original workforce of 30 employees and 3 holdover supervisors, plus 10 new employees and 2 new supervisors. During the week of December 14 through 19, its employee complement included 16 of the original unit employees, 2 hold- over supervisors, 11 new employees, and 2 new supervisors. Pet. App. 23a-24a, 30a-31a. 4 2la-22a. Thereafter, petitioner unilaterally reduced working hours and terminated all of the night shift employees. /d. at 23a. Petitioner never bargained with the Union and failed to make contributions to employee benefit funds. Jd. at 24a. 2. The Union filed unfair labor practice charges against petitioner. The Board, upholding the decision of the administrative law judge (ALJ), found that petitioner was a successor to Housekeepers and ac- cordingly obligated to recognize and bargain with the Union. Pet. App. 9a, 29a. The ALJ found that there was “substantial continuity” between petitioner and Housekeepers. Jd. at 28a. The ALJ explained that petitioner’s ‘operations and functions” were the same as those of its predecessor. /d. at 29a. On commenc- ing work, the ALJ noted, petitioner ‘utilized the exact same workforce performing the same jobs under the same working conditions and with the same super- visors that had been utilized by [Housekeepers].”’ ld. at 30a. The ALJ also observed that the services performed by the employees continued without inter- ruption. /bid. The ALJ further found that by December 9, when the Union requested recognition, petitioner “employed a full workforce with all job classifications filled.”’ Pet. App. 3la. The ALJ and the Board rejected petitioner’s assertion that the Housekeepers’ employ- ees hired by petitioner were temporary employees. The ALJ and the Board noted that the employees were never told they were temporary. /d. at 8a n.2, 32a. The ALJ further noted that there was ‘no known definite or contemplated date for their termi- nation.” Jd. at 32a. Based on those findings, the Board concluded that petitioner violated Sections 8(a)(5) and (1) of the National Labor Relations Act, 29 U.S.C. 158(a) (5) o and (1), by refusing to recognize and bargain with the Union and by making unilateral changes in work- ing conditions." Pet. App. 9a, 35a. 3. The court of appeals enforced the Board’s or- der. Pet. App. 6a. The court concluded that the Board’s finding that petitioner was a successor to Housekeepers was supported by substantial evidence. Citing Fall River Dyeing & Finishing Corp. v. NLRB, 482 U.S. 27 (1987), and NLRB vy. Burns Int'l Secu- rity Services, Inc., 406 U.S. 272 (1972), the court noted that the Board properly takes into account “the totality of the circumstances” in determining whether there has been “substantial continuity” between the old and new employers. Pet. App. 3a-4a. The court observed that one of the ‘“‘most significant” factors in determining successorship “is the overlap of work- forces between the two entities.” /d. at 4a. The court rejected petitioner’s assertion that, because it ac- quired no assets from Housekeepers, there could be no finding of successorship. The court explained that “{t]ransfer of ownership of assets * * * is only one factor” to be considered in determining whether “the second corporation basically has continued the busi- ness and workforce of the first.” 7d. at 6a n.2. On the facts of this case, the court of appeals observed that, when the Union made its bargaining demand, all of petitioner’s employees “were former House- keepers workers who were performing identical work to that which they had done under Housekeepers. The 3 Section 8(a) (5), 29 U.S.C. 158(a) (5). makes it an unfair labor practice for an employer “to refuse to bargain collec- tively with the representatives of his employees.” Section 8(a) (1), 29 U.S.C. 158 (a) (1), makes it unfair labor practice for ar employer to “restrain, coerce, or interfere with” the exercise of rights protected by Section 7 of the Act, 29 U.S.C. 157. 6 working conditions, production process, and custom- ers remained unchanged.” Jd. at 5a. The court of appeals rejected petitioner’s assertion that under the Board’s ruling, petitioner was pre- cluded from hiring its own permanent workforce. The court explained that, if petitioner had C-sired to hire its own employees and to treat the original unit employees as a temporary workforce, it could have simply told those employees that their status was temporary. Instead, the court noted, petitioner gave the employees job applications and union cards, thus misleading the employees into believing that their status was permanent. Petitioner “did nothing to combat the impression that any reasonable employee would have in these circumstances that the ‘new’ job merely was a continuation of the old.” Jd. at 5a-6a. ARGUMENT 1. Petitioner contends (Pet. 7-8) that the Board misapplied the successorship doctrine in this case by finding that petitioner was a successor firm even though it did not acquire the assets of its predecessor. That contention is foreclosed by NLRB v. Burns Int'l Security Services, Inc., 406 U.S. 272 (1972). In Burns, the Court sustained the Board’s determi- nation that Burns, as the successful bidder to a con- tract previously performed by Wackenhut Corpora- tion to furnish guard services, was required to bar- gain with the union that had represented Wacken- hut’s employees. 406 U.S. at 277-281." The Court ‘The Court rejected the Board’s position that the successor was required to assume the predecessor’s collective agreement. 406 U.S. at 291. The Court held instead that a successor who retains the predecessor’s workforce is required to consult with the collective bargaining representative of those em- 7 concluded that imposing a bargaining obligation is appropriate when the new employer maintains sub- stantial continuity in the operation of its predeces- sor’s business so that “the bargaining unit remains unchanged” and “a majority of employees after the change of ownership or management were employed by the preceding employer.” J/d. at 279, 281. The dissent in Burns argued that the successorship doc- trine should not apply since there had been no trans- fer of assets. 406 U.S. at 296-310 (Rehnquist, J., dissenting). The Court, however, refused to accept that principle. Instead the Court quoted with ap- proval the court of &peals’ finding that “[a]l! of the important factors which the Board has used and the courts have approved are present in the instant case: ‘continuation of the same types of product lines, de- partmental organization, employee identity and job functions.’ ”’ Jd. at 280 n.4.° Petitioner does not dispute that, under the Court’s decision in Burns, a finding of successorship is war- ranted in this case; it simply urges (Pet. 8-9) adop- tion of the dissenters’ view in Burns that the suc- cessorship doctrine should not apply in the absence of some transfer of assets. Petitioner, however, has advanced no reason why the Court should depart from the doctrine of stare decisis. Burns has been settled ployees before changing their terms and conditions of employ- ment. Jd. at 294-295. 5 The Court added that the Board had found that both Burns and Wackenhut “performed the identical services at the same facility; although Burns used its own supervisors, their func- tions and responsibilities were similar to those performed by their predecessors; and finally * * ~ Burns commenced per- formance of the contract with 27 former Wackenhut employ- ees out of its total complement of 42.” 406 U.S. at 280 n.4. 8 law for nearly twenty years, and its reasoning was recently reaffirmed and applied by this Court in Fall River Dyeing & Finishing Corp. v. NLRB, 482 U.S. 27, 36-41 (1987). There is no justification for re- visiting that statutory issue. See Hilton y. South Carolina Public Railways Comm’n, No. 90-848 (Dee. 16, 1991), slip op. 4 (“Time and again, this Court has recognized that ‘the doctrine of stare decisis is of fundamental importance to the rule of law.’ * * . Adherence to precedent promotes stability, predict- ability, and respect for the judicial authority.’’) ; California v. FERC, 110 S. Ct. 2024 (1990) ; Square D Co. y. Niagara Frontier Traffic Bureau, Inc., 476 U.S. 409 (1986). 29 Nor is there merit to petitioner’s suggestion (Pet. 11) that Fall River requires the Board to ‘focus on whether the new company has ‘acquired substan- tial assets of its predecessor and continued, without interruption or substantial changes, the predecessor's business operations.’”’ On the contrary; the Court in Fall River reiterated that, “[i]f the new employer makes a conscious decision to maintain generally the same business and to hire a majority of its employees from the predecessor, then the bargaining obligation of [Section] 8(a) (5) is activated.” 482 U.S. at 41. The Court went on to state that Burns had approved “the approach taken by the Board and accepted by courts with respect to determining whether a new company was indeed the successor to the old,” and that this approach “is primarily factual in nature and is based upon the totality of the circumstances of a given situation.” Jd. at 45. “Under this ap- proach, the Board examines a number of factors,” such as “whether the business of both employers is essentially the same” and “whether the employees of the new company are doing the same jobs in the same 9 working conditions under the same supervisors.” Ibid. While the Court in Fall River noted that the Board will also examine “whether the new company has ‘acquired substantial assets of its predecessor,’ ” 452 U.S. at 43, quoting Golden State Bottling Co. v. NLRB, 414 U.S. 168, 184 (1973), it was not suggest- ing that this factor is essential to a finding of suc- eessorship. Rather, the statement merely reflects the fact that the acquisition of assets, which occurred in Fall River and Golden State, is a factor to be con- sidered in determining whether there is “substantia! continuity” between the old company and the new one. Fall River stated, however, that the essential question is whether “those employees who have been retained will understandably view their job situations as es- sentially unaltered.” 482 U.S. at 43. Here, as in Burns, while there was no assets ac- quisition, the other indica of continuity were sufficient to justify the Board in concluding that the employees would “view their job situations as essentially un- altered.” As the court of appeals noted, petitioner “chose to rehire a workforce that had grown accus- tomed to new owners adopting the collective bargain- ing arrangements of former employers”; petitioner “not only rehired those same workers, but did so in a manner which would indicate that the same prac- tice was continuing”; and the “operations * *. > Te main[ed] essentially the same after the transfer of ownership.” Pet. App. 6a. The court of appeals’ de- termination that the Board’s order is supported by substantial evidence warrants no review here. Uni- versal Camera Corp. v. NLRB, 340 U.S. 474, 491 (1951).° 6 Petitioner’s statement of the questions presented (Pet. i) appears to raise the issue of whether successorship can be 10 CONCLUSION The petition for a writ of certiorari should be denied. Respectfully submitted. KENNETH W. STARR Solicitor General JERRY M. HUNTER General Counsel D. RANDALL FRYE Acting Deputy General Counsel NORTON J. COME Deputy Associate General Counsel LINDA SHER Assistant General Counsel National Labor Relations Board JANUARY 1992 found when employment of the predecessor’s employees is “forced” and “temporary” as a result of the government’s failure to grant security clearances quickly. Petitioner does not argue that point in the body of the petition, and it raises at most a fact specific issue that does not warrant this Court’s review. In any event, the Board, upheld by the court of appeals, found that petitioner never told the predecessor’s employees that their employment was temporary, but instead treated them as permanent employees. Pet. App. 5a-6a. Accordingly, this case does not present any issue of forced temporary hiring. WU. S. GOVERNMENT PRINTING OFFICE; 1992 312324 45258 --- Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385009_2849%3A3. Public record. Not legal advice.