NLRB v. Pan American Grain

448 F.3d 465, 2006 WL 1479782
Court of Appeals for the First Circuit·Decided December 22, 2005·No. 05-1274·Published

Opinion

United States Court of Appeals For the First Circuit

No. 05-1274 NATIONAL LABOR RELATIONS BOARD, Petitioner/Cross-Respondent, v.

PAN AMERICAN GRAIN CO., INC. and PAN AMERICAN GRAIN MANUFACTURING CO., INC.,

Respondent/Cross-Petitioner.

ON APPLICATION FOR ENFORCEMENT AND CROSS-PETITION FOR REVIEW OF AN ORDER OF THE NATIONAL LABOR RELATIONS BOARD

Before

Boudin, Chief Judge,

Selya, Circuit Judge,

and Stahl, Senior Circuit Judge.

Ruperto J. Robles and Rafael J. Lopez on brief for petitioner/cross-respondent.

Arthur F. Rosenfeld, Acting General Counsel, John E. Higgins, Jr., Deputy General Counsel, Margery E. Lieber, Acting Associate General Counsel, Aileen A. Armstrong, Deputy Associate General Counsel, Meredith L. Jason and Christopher W. Young on brief for respondent/cross-petitioner.

December 22, 2005

BOUDIN, Chief Judge. We have before us an application by the National Labor Relations Board ("the Board" or "NLRB") for enforcement of the order it issued against a grain processing company, Pan American.1 Pan American cross-petitions to set aside portions of the Board's order.

Pan American is a Puerto Rican company that manufactures animal feed and processes rice for human consumption. Congresso de Uniones Industriales de Puerto Rico ("the Union") has been the collective-bargaining representative of Pan American's production and maintenance employees for many years, but the last collective- bargaining agreement between the Union and Pan American expired in 2000 for two Pan American facilities (the Amelia and Corujo facilities) and 2002 for the other (the Arroz Rico facility).

From 1996 to 2002, Pan American undertook a long-term project designed to modernize and automate some of its facilities; it initiated this project to help offset the cost of complying with an Environmental Protection Agency consent decree. These upgrades caused the company's staffing needs gradually to decline, and Pan

1 Pan American is two corporate entities, Pan American Grain Co., Inc. and Pan American Grain Mfg. Co., Inc., whose brief states that they are "affiliated business enterprises with common officers, directors, management and supervision, formulating and administering a common policy affecting operations."

American laid off one or two employees each year during the modernization.

In January 2002, employees at the Amelia and Corujo facilities went on strike. The strike caused a decline in sales. The following month, the company president met with two managers and the group decided that, because of the decline in sales and the increased efficiency resulting from the modernization, fifteen employees should be permanently laid off. On February 27, 2002, Pan American told fifteen of the striking employees that their positions had been permanently eliminated. Pan American was later charged with committing various unfair labor practices in violation of the National Labor Relations Act ("the Act" or "NLRA"), 29 U.S.C. §§ 151 et seq. (2000).

In the proceedings that followed, the NLRB found that Pan American had engaged in numerous unfair labor practices, but the only such finding challenged on petition to this court was that Pan American had violated section 8(a)(5) and (1) of the Act, 29 U.S.C. § 158(a)(5), (1), by failing to give the Union notice and an opportunity to bargain as to the layoff decision and its effects before laying off these fifteen employees.2 To remedy this

2 As Pan American did not contest the other findings by the Board, the Board is entitled to summary enforcement of those portions of its order related to these findings. See E.C. Waste, Inc. v. NLRB, 359 F.3d 36, 41 (1st Cir. 2004).

violation, the Board ordered Pan American to reinstate the fifteen employees and compensate them with back pay.

Pan American challenges the Board's finding as to the section 8(a)(5) and (1) violation and the remedy imposed in connection with this violation. It argues first that it was not required to bargain with the dismissed employees regarding the decision to dismiss them, conceding that it was required to bargain regarding the effects of the layoff decision. Second, Pan American asserts that in light of its limited bargaining duty, the remedy of reinstatement and full back pay was improper, and under Board precedent in Transmarine Navigation Corp., 170 N.L.R.B. 389 (1968), only limited back pay could be required.

The Board asserts that Pan American is precluded from making its first argument on this petition because it did not present it to the Board in the proceedings below. As for Pan American's second argument, the Board urges that we should dispose of it by finding that the facts of this case do not warrant the limited remedy Pan American seeks. We conclude that Pan American's arguments are interrelated, were presented to the Board, and cannot be resolved without further explanation by the Board.

To understand both the waiver argument and the merits of the case requires a brief explanation of the background law. Under section 8(a)(5) of the NLRA, 29 U.S.C. § 158(a)(5), an employer's

"refus[al] to bargain collectively with the representatives of his employees" constitutes an "unfair labor practice"; section 8(d) of the Act, id. § 158(d), specifies that the duty "to bargain collectively" includes the obligation to "confer in good faith with respect to wages, hours, and other terms and conditions of employment." Absent contrary provisions in a collective bargaining agreement, there are thus some decisions as to which a unionized employer must bargain with the union (e.g., wages and hours); others as to which it normally need not, "such as choice of advertising and promotion, product type and design, and financing arrangements," which "have only an indirect and attenuated impact on the employment relationship," First Nat'l Maint. Corp. v. NLRB, 452 U.S. 666, 676-77 (1981); and yet others entailing obligations that fall somewhere in between.

The present case may or may not fall in this "in between"

category. In certain situations, a decision to order layoffs may be the prerogative of management but an obligation may still exist to bargain with the union as to "effects" of the layoffs; in other words, management may have to bargain about whether and to what extent to provide severance to the laid-off employees even though it may not have to discuss whether to make the layoffs. Both the

courts (e.g., Providence Hospital)3 and the Board (notably in Transmarine)4 have endorsed such a qualified duty in certain circumstances.

Before the Board, Pan American argued that it did not have to bargain with the Union at all so no relief was proper; but in the alternative it argued that at most its bargaining obligation was limited to the "effects" of the layoffs and therefore back pay for a limited period would be the most that should be awarded. The latter argument depends upon two elements: that only effects bargaining was required in this case, and that where only effects bargaining is required, the limited back pay remedy prescribed in Transmarine is appropriate for a breach of the bargaining duty (because reinstatement would defeat the layoff prerogative).

Pan American made this alternative two-part argument both in its exceptions to the findings of the administrative law judge

3 See Providence Hosp. v. NLRB, 93 F.3d 1012, 1018 (1st Cir.

1996) ("[U]nions generally enjoy the right to bargain over the effects of decisions which are not themselves mandatory subjects of collective bargaining."); NLRB v. New England Newspapers, Inc., 856 F.2d 409, 413 (1st Cir. 1988) ("Although the employer is not obligated to bargain regarding the decision to sell its business, the effects of that sale are . . . a mandatory subject of bargaining . . . .").

Free access — add to your briefcase to read the full text and ask questions with AI

NLRB v. Pan American Grain, 448 F.3d 465, 2006 WL 1479782 (1st Cir. 2005).

448 F.3d 465 (NLRB v. Pan American Grain) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

Related