Skyline Distributors, a Division of Acme Markets, Inc. v. National Labor Relations Board

99 F.3d 403, 321 U.S. App. D.C. 264, 153 L.R.R.M. (BNA) 2801, 1996 U.S. App. LEXIS 29116, 1996 WL 647595
CourtCourt of Appeals for the D.C. Circuit
DecidedNovember 8, 1996
Docket95-1571
StatusPublished
Cited by33 cases

This text of 99 F.3d 403 (Skyline Distributors, a Division of Acme Markets, Inc. v. National Labor Relations Board) is published on Counsel Stack Legal Research, covering Court of Appeals for the D.C. Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Skyline Distributors, a Division of Acme Markets, Inc. v. National Labor Relations Board, 99 F.3d 403, 321 U.S. App. D.C. 264, 153 L.R.R.M. (BNA) 2801, 1996 U.S. App. LEXIS 29116, 1996 WL 647595 (D.C. Cir. 1996).

Opinions

Opinion for the Court filed by Chief Judge EDWARDS.

Concurring opinion filed by Circuit Judge HENDERSON.

HARRY T. EDWARDS, Chief Judge:

This petition for review, brought by Skyline Distributors (“Skyline” or “petitioner”), a Division of Acme Markets, Inc. (“Acme”), raises the question of whether an employer, who is guilty of no other unfair labor practices (“ULPs”), can be required by the National Labor Relations Board (“Board” or “NLRB”) to recognize and bargain with a union solely on the basis, of having granted economic benefits to employees who first seek and then reject union representation. Underlying this petition is the long debated issue over the impact of economic inducements given by employers during union representation campaigns. Although some studies have suggested that there is no good basis for the belief that a grant of benefits by itself leads employees to infer a threat of reprisal if they opt in favor of unionization, the Supreme Court ruled otherwise in NLRB v. Exchange Parts Co., 375 U.S. 405, 409-10, 84 S.Ct. 457, 459-60, 11 L.Ed.2d 435 (1964) (holding that an employer giving employees economic inducements that are timed to affect employees’ choice for or against unionization constitutes an ULP under Section 8(a)(1) of the National Labor Relations Act, 29 U.S.C. § 158(a)(1)). Nonetheless, even assuming that the grant of benefits may be an ULP, it does not follow that unlawful economic inducements alone justify a bargaining order under NLRB v. Gissel Packing Co., 395 U.S. 575, 89 S.Ct. 1918, 23 L.Ed.2d 547 (1969). That is the question now before this court.

In the instant ease, Skyline first declined to bargain with agents from District Lodge No. 98, International Association of Machinists & Aerospace Workers, AFL-CIO (“IAM”), who sought to represent a small unit of maintenance employees at the company’s otherwise heavily unionized warehouse operation. Company officials then announced to the employees that management had decided to lift a wage freeze and restructure wages, thus, effectively granting a wage increase to the maintenance workers. Although the company’s decision to lift the wage freeze was made before the advent of the union campaign, the Board held that it was ill-timed, found that it constituted an ULP, and ruled that the employer was required to bargain under Gissel. See Skyline Distributors, a Division of Acme Markets and District Lodge No. 98, 319 NLRB No. 44, 1995 WL 610401 (October 16, 1995)(here-inafter Skyline Distributors), reprinted in Appendix (“App.”) 32.

Although we adopt no per se rule, and we do not mean to say that a Gissel bargaining order can never issue solely on the basis of economic inducements, we find no basis for a bargaining order on the record in this case. Under Gissel, absent “outrageous and pervasive ULPs,” of which there are none here, the Board may issue a bargaining order only if it is found that an employer’s ULPs had a tendency to undermine the union’s majority status and impede the election process, and .the Board determines that the possibility of erasing the effects of the unlawful conduct and ensuring a fair election by the use of traditional remedies is slight and would be better protected by a bargaining order. The Board has not come close to satisfying this standard. It is not just that the Board has failed to justify its position; rather, on this record, we find that there is no way that the Board can find substantial evidence justifying a Gissel bargaining order.

We grant the Board’s cross-petition for enforcement of its determination of an appropriate bargaining unit and its findings that Skyline’s economic inducements constituted ULPs. However, we grant Skyline’s petition for review on the Gissel bargaining order, reversing on this point and remanding the case to the Board for further proceedings.

I. BACKGROUND

Skyline, a division of Acme, a large mid-Atlantic based supermarket chain, employs about 200 people in a warehouse in Lancaster, Pennsylvania. The warehouse serves as a distribution center for Acme. Approxi[405]*405mately 90% of Skyline’s employees are affiliated with a union; however, the maintenance and sanitation area, composed of 16 employees — seven maintenance and nine sanitation — is not unionized.

During early 1992, some of Skyline’s maintenance employees expressed displeasure with their pay scale. Members of management were pressed by the employees to restructure wages, on the claim that maintenance employees with significant seniority were being underpaid. The maintenance supervisor was sympathetic to the employees’ plight and forwarded their complaints to senior management. However, these initial complaints drew no response from top management.

Two other issues fueled the employees’ discontent. In January of 1992, Acme announced that employee copayments for health insurance benefits would increase. Subsequently, on February 17, 1992, Skyline management imposed a wage freeze on all salaried employees, and then the Skyline Salary Administration Division mistakenly applied the wage freeze to the maintenance workers and other non-union, hourly-paid employees. The maintenance employees complained about being covered by the wage freeze, but their objections appeared to fall on deaf ears.

In fact, however, company officials were acutely aware of the problem over the mistaken application of the wage freeze. Labor Relations Vice President Bailey testified that

soon after the freeze was announced in February, complaints from hourly paid workers about it quickly came to management’s attention. Facing increasing discontent, Respondent’s president met with the executive committee, including DiBer-nardino, sometime in April, and decided that the wage freeze policy should apply to management, but not to unrepresented, hourly paid workers. By memo dated April 30, the salary administration division was advised that “Non-union Clerical and Maintenance Wage” employees ... “will not be subject to the 1992 management wage freeze.”

Skyline Distributors at 3-4, reprinted in App. 34435. The Board specifically found that “[t]he truth, as Bailey’s testimony and [Skyline’s] exhibit show, is that the decision to correct the wage freeze error came about sometime before April 30.” Id. at 7, reprinted in App. 38. The maintenance employees, however, were initially unaware of management’s decision to lift the wage freeze.

Acting in obvious frustration over management’s apparent failure to lift the wage freeze on non-union, hourly-paid employees, the maintenance employees contacted Clark Ruppert, a business representative of IAM, to inquire about their joining the union. An initial meeting between the employees and the IAM agent was set for May 9, 1992.

Six of the seven maintenance employees attended the May 9 meeting. They voiced their complaints about the wage freeze, the wage scale, increasing health insurance co-payments, and other working conditions. All of the employees present at the meeting then signed union authorization cards, indicating that they wished the union to serve as their collective bargaining representative.

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99 F.3d 403, 321 U.S. App. D.C. 264, 153 L.R.R.M. (BNA) 2801, 1996 U.S. App. LEXIS 29116, 1996 WL 647595, Counsel Stack Legal Research, https://law.counselstack.com/opinion/skyline-distributors-a-division-of-acme-markets-inc-v-national-labor-cadc-1996.