McKinney v. Kellogg Co.

33 F. Supp. 3d 937, 2014 WL 3746448, 200 L.R.R.M. (BNA) 3250, 2014 U.S. Dist. LEXIS 104239
CourtDistrict Court, W.D. Tennessee
DecidedJuly 30, 2014
DocketNo. 14-2272
StatusPublished
Cited by1 cases

This text of 33 F. Supp. 3d 937 (McKinney v. Kellogg Co.) is published on Counsel Stack Legal Research, covering District Court, W.D. Tennessee primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
McKinney v. Kellogg Co., 33 F. Supp. 3d 937, 2014 WL 3746448, 200 L.R.R.M. (BNA) 3250, 2014 U.S. Dist. LEXIS 104239 (W.D. Tenn. 2014).

Opinion

ORDER

SAMUEL H. MAYS, JR., District Judge.

Before the Court is the April 15, 2014 Petition for Temporary Injunction under 10(j) of the National Labor Relations Act (the “Act”), brought by the General Counsel of the National Labor Relations Board (the “Board”) through M. Kathleen McKinney, Director of Region 15 of the Board (“Petitioner”). (Corrected Petition, D.E. 5.) The Board seeks temporary relief against Respondent Kellogg Company (“Kellogg”) for forcing impasse over non-mandatory bargaining issues and locking out employees at its Memphis, Tennessee plant in violation of 29 U.S.C. § 158(a)(1), (3), and (5).

On June 23, 2014, the Court denied Kellogg’s motion to dismiss for lack of jurisdiction and granted Petitioner’s motion to consider the Petition based on the administrative record. (D.E. 53; D.E. 54.)

On May 27, 2014, Petitioner filed a copy of the administrative record.1 (Notice, [940]*940D.E. 45.) Petitioner filed a memorandum in support of the Petition on June 13, 2014. (Pet.Mem., D.E. 49.) On the same day, the Bakery, Confectionery, Tobacco Workers and Grain Millers International Union and its Local 252-G (the “Union”) filed an Amicus brief in support of the Petition. (Amicus Brief, D.E. 48.) Kellogg responded on June 30, 2014. (Resp., D.E. 55.) Petitioner and the Union filed replies on July 10, 2014. (Pet. Reply, D.E. 61; Ami-cus Reply, D.E. 62.) Kellogg filed a sur reply on July 17, 2014. (Sur Reply, D.E. 65.) For the reasons that follow, the Petition is GRANTED.

I. Background

This action arises out of a labor dispute between Kellogg and the Union. (Jt. Ex. 5 at 1.) Kellogg and the Union are bound by a mutually consented Master Agreement, which covers four Kellogg plants, including the Memphis plant, and is effective from September 30, 2012, to October 3, 2015. (Id. at 50; Jt. Ex. 1 at 2.) The Union and Kellogg were also parties to a Supplemental Agreement applying only to the Memphis plant, which was effective from October 22, 2010, to October 22, 2013. (See Supp. Agreement, Jt. 1.) Kellogg locked out the employees at its Memphis plant after Kellogg and the Union failed to agree to a new Supplemental Agreement before the existing Agreement expired. (See Letters, Jt. Exs. 12 & 13.)

Kellogg initiated negotiations for a new Supplemental Agreement on September 17, 2013. (Jt. Ex. 5 at 1; Bargaining Agenda, Jt. Ex. 6.) During the first negotiating session, Kellogg informed the Union that the Memphis plant needed to cut costs significantly to remain competitive for work within the Kellogg manufacturing network. (Jt. Ex. 5 at 1; Tr. Hearing Vol. 3 at 334.) Kristie Chorny, Senior Director of Labor Relations for Kellogg, said there was significant excess capacity in Kellogg’s manufacturing network because demand for breakfast cereal had declined. (Trans. Vol. 3 at 334.) To curb costs, Kellogg wanted to change the “concept” of Casual employees (or “Casuals”) and greatly expand their role at the Memphis plant. (Tr. Hearing Vol. 3 at 344.) Chorny told the Union that Kellogg “want[s] to redo the Casual employee to make them the employee of the future.” (Meeting Tr., Jt. Ex. 3(a) at 9.)

Kellogg had proposed similar across-the-board cuts to wages and benefits for new employees during negotiations for the Master Agreement. (See 2005 Master Agreement Negotiations Company Proposals, GC Ex. 3; Hearing Tr. Vol. 1 at 107-108.) During the 2005 negotiations for the Master Agreement, Kellogg proposed a two-tiered wage structure with a lower-paid “qualified Casual workforce” to be used regularly in its manufacturing facilities. (GC Ex. 3 at 2.) Kellogg made similar proposals during discussions preceding the parties’ 2009 and 2012 negotiations of the Master Agreement, but the parties never agreed to implement a two-tiered pay structure as part of the Master Agreement. (See Hearing Tr. Vol. 1 at 112-116, 119-120.)

The Master Agreement provides that Casual employees must make $6.00 an hour less than Regular employees (or “Regulars”), but does not define Casuals, the scope of their employment, or provide for benefits. .(Master Agreement, Jt. Ex. 2 at 67.) The Supplemental Agreement provides that Casuals are employed “to [941]*941provide regular employees with relief from extended work schedules[.]” (Supp. Ag., Jt. Ex. 1 at 8.) There is no provision altering Casuals’ pay or providing them benefits. Among other restrictions, “Casual employees will be limited to 30% of the total number of Regular employees.” (Id.) Under Kellogg’s 2013 proposal, there would be no cap on Casuals and no limits on their work within the Memphis plant. (See Chorny Test., Tr. Hearing Vol. 3 at 388.) The “only distinction going forward between a regular and a casual employee” would be their wages and benefits. (Id.)

At the first meeting, the Union balked at Kellogg’s proposed concept for Casuals, and the parties made no progress afterward. Kellogg’s written agenda for the second negotiating session, held on September 18, 2013, stated that the Union had “flatly rejected Kellogg’s proposal to expand the casual concept in Memphis [the previous day], and indicated it would not be providing a counter proposal.” (Jt. Ex. 6 at 1.) During a negotiating session on September 26, 2013, Chorny said that Kellogg’s proposal would change a Casual employee to “basically what a new hire is today.” (Meeting Tr., Jt. Ex. 3(e) at 17.) Union representative Kevin Bradshaw (“Bradshaw”) responded that Kellogg’s proposal should be “negotiated at the Master level,” that Kellogg was trying to “force” the proposal on the Union, and that the Union would not negotiate over its details. (Id. at 18-19.)

In a negotiating session on October 9, 2013, Chorny continued to press the Union to agree to Kellogg’s proposal or to propose amendments. She said, “I think you need to understand the Casual of today is no longer what we are talking about.” (Jt. Ex. 3(j) at 2.) “The Casual of tomorrow will be different, they will have seniority rights, a probationary period, job bidding like a Regular employee [and] will be at the negotiated [wage] rate for a Casual allowed for in the master.” (Id.) Bradshaw responded that the Union “would like to get away from the Casual [concept] and just call them employees. You are double talking, they are just employees.” (Id.) Chorny replied that Kellogg had “to classify them somehow and they do not have the same benefits and wage[s] as a Regular. Casual is already established and in place.” (Id.) Chorny said that, under Kellogg’s new concept of Casuals, a 30% cap was unacceptable. (Id. at 13.)

When questioned about the details, Chorny conceded to Bradshaw that a Regular employee could be laid off for business reasons and brought back as a Casual, to which Bradshaw replied:

[T]he answer is hell no, you need to jerk that off the table. Hell no.... I have had companies pull this crap out there and then say we are going to lay them off for a while and then bring them back at new pay.”

(Id. at 16.) The Union never provided a written counter offer to Kellogg’s new Casual-employee concept.

On October 16, 2013, Kellogg provided the Union its “Last/Best Offer,” informing it that Kellogg would lock out the employees if the Union did not agree to the offer by October 22, 2013. (Last/Best Offer, Jt. Ex.

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33 F. Supp. 3d 937, 2014 WL 3746448, 200 L.R.R.M. (BNA) 3250, 2014 U.S. Dist. LEXIS 104239, Counsel Stack Legal Research, https://law.counselstack.com/opinion/mckinney-v-kellogg-co-tnwd-2014.