San Francisco Web Pressmen and Platemakers' Union No. 4 v. National Labor Relations Board, Michael Tenorio and Gil Fowler, Charging Parties

794 F.2d 420

• Court: Court of Appeals for the Ninth Circuit
• Decided: July 22, 1986
• Docket: 83-7701, 83-7822
• Status: Published

Opinions

FERGUSON, Circuit Judge:

San Francisco Web Pressmen and Plate-makers’ Union No. 4 (“Union”) petitions for review of the National Labor Relations Board (“Board”) Second Supplemental Decision and Order dated October 24, 1984; the Board applies for enforcement. That decision orders the Union to arbitrate a wrongful termination grievance, permits the employees involved to hire outside counsel at the union’s expense, and orders the Union to pay back wages if the grievance cannot be arbitrated. We grant enforcement of those parts of the order compelling arbitration and permitting outside counsel, and deny enforcement of that part of the order making the Union potentially liable for backpay.

I.

Michael Tenorio and Gil Fowler (“Employees”), members of the Union since 1977, became involved in a barroom fight in August 1978 with another Union member. On learning of the incident, the Union Executive Board contacted the Employees and requested that they explain their conduct. The Employees considered the incident of no concern to the Union, and on August 23, 1978, told Paul Trimble, a member of the Executive Board, over the telephone that they would not appear. They visited Trim-ble at work that same day and, in a loud voice, Fowler asked to speak with him. Trimble agreed, but Fowler replied that he wanted to see him outside. Fowler asked when Trimble got off work, and promised to see Trimble then. Trimble felt threatened and asked security personnel to accompany him to his bus stop after work. Trimble reported the story to the Employer, who discharged Tenorio and Fowler the following day.¹

The Union filed a grievance on the Employees’ behalf. Union investigators interviewed Trimble and two eyewitnesses, but neither Tenorio nor Fowler. On August 29, 1978, the Joint Standing Committee, composed of two Employer and two Union representatives, upheld the discharges for cause. The Union declined to arbitrate the grievance.

On September 1, 1978, the Employees filed unfair labor practice charges with the National Labor Relations Board against the Employer and the Union. The General Counsel to the Board determined that the Employees were discharged “for cause,” and issued no complaint against the Employer. He did, however, issue a complaint against the Union, charging it with breach of its duty of fair representation in processing Employees’ grievance. After a hearing, an administrative law judge (AU) found a breach by the Union. The Board reversed on April 25, 1980, but this court reversed the Board and remanded, holding that the Union had breached its duty by failing to interview the Employees. Teno-rio, 680 F.2d at 602.

On remand the Board issued a Supplemental Decision and Order. The Union timely petitioned this court for review of the decision. The Board applied for enforcement. The Board issued a Second Supplemental Decision clarifying a portion of its prior order.²

The Board ordered, in part, that the Union:

(1) Request the Employer to reinstate Tenorio and Fowler, and pursue the remaining stages of the grievance procedure, including arbitration, if necessary.

(2) Permit Employees to retain their own counsel during the grievance process and pay reasonable legal fees of such representation.

(3) Pay Employees back wages from the date they first requested the Union to redress their grievance until they obtained substantially equivalent employment (less net earnings, plus interest) in the event that it is not possible to finally process the Employees’ grievance.

Thereafter, the Board amended its application for enforcement, and the Union amended its petition for review.

II.

The Union challenges the propriety of the arbitration order, the permission to hire outside counsel at the Union’s expense, and the backpay order. We discuss each issue in turn.

First, the Union contends that the Board improperly ordered the Union to pursue the grievance if the Employer refuses to reinstate the Employees. The Union argues that it effectively complied with the order by seeking reinstatement and arbitration after the AU’s decision, and by referring the Employees to the Employer for hire.³ We disagree. These efforts do not constitute full compliance with the order. For example, the Union has not attempted to compel arbitration through a section 301 suit.⁴

Second, the Union challenges the Board’s order permitting the Employees to hire outside counsel for the remainder of the grievance procedure at the Union's expense. The Union argues that arbitration is impossible and therefore this portion of the order is “meaningless.” We disagree.

A union has no duty to process a frivolous grievance. Dutrisac v. Caterpillar Tractor Co., 749 F.2d 1270, 1275 (9th Cir.1983). However, a union may be liable for the expense of outside representation if it has failed to process a nonfrivolous grievance fairly. Id. at 1275-76.⁵ Though the court in Tenorio made no explicit assessment of the merits of the Employees’ grievance, we read Tenorio to hold that the grievance was not frivolous, because it found a breach of duty by the Union. Tenorio, 680 F.2d at 602. Therefore, the assessment of attorney’s fees is within the Board’s broad discretion. Dutrisac, 749 at 1275-76.

Third, the Union argues, and we agree, that because no tribunal has yet concluded that the Employees were discharged in breach of their contract, the Employees are not entitled to a backpay award. We hold that the Employees must show both a wrongful discharge by the Employer and a breach of duty by the Union to collect backpay from the Union.⁶

The Board has broad discretion in fashioning a backpay remedy, and the remedy should stand unless it is an attempt to achieve ends not within the policies of the NLRA. NLRB v. International Association of Bridge, Structural and Ornamental Iron Workers Local 433, 600 F.2d 770, 777-78 (9th Cir.1979) (citing J.H. Rutter-Rex Manufacturing Co., 396 U.S. 258, 263, 90 SCt. 417, 420, 24 L.Ed.2d 405 (1969)), cert. denied, 445 U.S. 915, 100 S.Ct. 1275, 63 L.Ed.2d 599 (1980). However, we enforce an order only if “the Board correctly applied the law.” Clear Pine Mouldings, Inc. v. NLRB, 632 F.2d 721, 724 (9th Cir.1980), cert. denied, 451 U.S. 984, 101 S.Ct. 2317, 68 L.Ed.2d 841 (1981). We find that the Board incorrectly applied the law.

An employer and a union are jointly and proportionately liable for back-pay when the employer has caused damage by wrongfully discharging the employee and the union has increased that damage by breaching its duty of fair representation. E.g., Bowen v. United States Postal Service, 459 U.S. 212, 223, 103 S.Ct. 588, 595, 74 L.Ed.2d 402 (1983); Hines v. Anchor Motor Freight, Inc., 424 U.S. 554, 566, 96 S.Ct. 1048, 1057, 47 L.Ed.2d 231 (1976).⁷ The employer and union each are liable for the portion of damages that it caused: the employer for back pay from the date of the wrongful termination to the date the employee would have been reinstated had the union not breached its duty, and the union for backpay thereafter. Id.

“[Breach of contract and fair representation] claims are inextricably interdependent. ‘To prevail against either the company or the Union, ... [the employees] must not only show that their discharge was contrary to the contract but must also carry the burden of demonstrating a breach of duty by the Union.’ ”... The employee may, if he chooses, sue one defendant and not the other, but the case he must prove is the same whether he sues one, the other, or both.

DelCostello v. International Brotherhood of Teamsters, 462 U.S. 151, 164-65, 103 S.Ct. 2281, 2290-91, 76 L.Ed.2d 476 (1983) (quoting United Parcel Service, Inc. v. Mitchell, 451 U.S. 56, 66-67,101 S.Ct. 1559, 1565-66, 67 L.Ed.2d 732 (1981) (citation omitted)).⁸

The Employees argue that the Supreme Court cases require an employee to show both wrongful discharge and breach of duty to prove employer liability, not union liability. They argue that they therefore should not have to show a wrongful discharge for the Union to be liable. We disagree. The language and reasoning of the cases refer to union liability for back-pay as well. In addition, our circuits, other circuits, and the Board have required a showing that the employer breached the collective bargaining agreement before holding the union liable for backpay.⁹

In NLRB v. Pacific Coast Utilities Service, Inc., 638 F.2d 73 (9th Cir.1980), we enforced a Board order granting backpay against both the employer and the union when substantial evidence in the record supported the Board’s findings of both wrongful discharge and breach of duty of fair representation. We treated the wrongful discharge finding as a prerequisite to the employer and union’s backpay liability: “Given the determination that discharge was wrongful, it follows that the failure of the union to represent the employee was damaging to him and a contributing factor to his loss of pay.” Id. at 74 (citing Newport News Shipbuilding & Dry Dock Co., 236 NLRB No. 197 (1978)).

Other circuits have followed this rule. See United Steelworkers of America v. NLRB, 692 F.2d 1052 (7th Cir.1982) (denying enforcement of Board order awarding backpay against union for breach of duty because grievance not shown to have merit); NLRB v. Eldorado Manufacturing Corp., 660 F.2d 1207, 1215 (7th Cir.1981) (Board should impose backpay liability against employer and union “only if the discharges were contrary to the collective bargaining contract and if the Union breached its duty of fair representation”); NLRB v. Local 485, International Union of Electrical, Radio and Machine Workers, 454 F.2d 17, 23 (2d Cir.1972) (denying enforcement of Board order awarding backpay against union for breach of duty because grievance not shown to have merit).¹⁰

The Board itself has used this rule. In Glass Bottle Blowers Association, 240 NLRB 324 (1979), the Board affirmed the ALJ’s order to process a wrongful discharge grievance and to reimburse the employees for outside counsel at those proceedings, but rejected a backpay request. Id. at 325. The Board reasoned that, without a resolution of the underlying griev-anee against the employer, such an award would be punitive. M¹¹

III.

We grant enforcement of that part of the Board’s order compelling the Union to pursue the Employees’ grievance and to hire outside counsel at the Union’s expense. We deny enforcement of that part of the order awarding backpay in the event arbitration is impossible.

1 . The events surrounding the Employees’ discharge and the Union’s failure to process their grievance properly are recounted in Tenorio v. NLRB, 680 F.2d 598, 600-01 (9th Cir.1982).

2 . The first supplemental decision ordered the Union to pay back wages in the event that the grievance could not be processed "due to considerations of timeliness.” The second supplemental decision more fully explained the rationale of the backpay award and ordered the Union to pay back wages if the grievance was prohibited “for any procedural or substantive reason.”

3 . Tenorio was eventually hired through the referral.

4 . We recognize that the four-year statute of limitations may bar a section 301 suit. However, federal interests such as the parties’ attempt to resolve the case through the Board, see Retail Clerks Union Local 648 v. Hub Pharmacy, Inc., 707 F.2d 1030, 1033-37 (9th Cir.1983), may toll the statute, or the statute may be equitably tolled under California law, id. at 1033.

5 . Exclusive representation by the Union is the rule, and privately retained counsel the exception. Castelli v. Douglas Aircraft Co., 752 F.2d 1480, 1484-85 (9th Cir.1985). Given the Union’s breach of duty, the Board’s order is within the exception.

6 . Tenorio and Fowler have established that the Union breached its duty of fair representation. Tenorio, 680 F.2d at 601-02.

7 . The Supreme Court cases involve section 301 suits. This case involves an unfair labor practice charge brought before the Board under section 10(c) of the NLRA. However, we may use the same analysis for fair representation claims brought before either tribunal. NLRB v. Eldorado Manufacturing Corp., 660 F.2d 1207, 1215 (7th Cir.1981); NLRB v. Local 485, International Union of Electrical Radio and Machine Workers, 454 F.2d 17, 22 (2d Cir.1972).

8 . Section 301 suits are hybrid actions against the employer and the union, and normally an employee sues both. However, the reasoning and language of DelCostello apply to each defendant.

9 . The dissent erroneously assumed that, to establish the wrongfulness of a discharge, an employee must litigate directly against the employer. We impose no such requirement. An employee may use traditional discovery tools to obtain information from the employer. Thus, the Employees need not preserve their rights to sue the Employer, as the dissent states.

10 . The courts rely on various reasons to support this conclusion. In United Steelworkers of America, 692 F.2d at 1058, and Local 485, 454 F.2d at 23, they concluded that a lack of a judicial or administrative finding of wrongful discharge rendered backpay speculative and punitive, and therefore outside the scope of the Board’s remedial powers. Additionally, the court in United Steelworkers of America, 692 F.2d at 1058, observed that if the grievance is not meritorious, the employee would be rewarded for misconduct.

11 . A useful analogy with a requirement to show both a breach of duty and a harm caused or increased by that breach is attorney malpractice liability. See, e.g., Weitzel v. Oil Chemical and Atomic Workers International Union, Local 1-5, 667 F.2d 785, 787 (9th Cir.1982) (‘‘[T]he standard in a malpractice suit should not be whether the NLRB attorney exercised ordinary skill and care, but whether the case could have been won____”) A client is not entitled to recover from the attorney just by showing a breach of duty alone.