Halkias v. General Dynamics Corp. ( 1994 )

UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT
_____________________
No. 93-1664
_____________________
JOHN HALKIAS, ET AL.,
Plaintiffs,
JOHN HALKIAS and BARRY JACKSON,
Plaintiffs-Appellants,
VERSUS
GENERAL DYNAMICS CORPORATION,
Defendant-Appellee.
____________________________________________________
Appeal from the United States District Court
for the Northern District of Texas
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_____________________
No. 93-1680
_____________________
JOHN ANTHONY CUREINGTON,
Plaintiff-Appellant,
VERSUS
GENERAL DYNAMICS CORPORATION,
Defendant-Appellee.
____________________________________________________
Appeals from the United States District Court
for the Northern District of Texas
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No. 93-8204
_____________________
ALVIN STAUDT, on behalf of himself and
all others similarly situated,
Plaintiff-Appellant,
VERSUS
GLASTRON, INC.,
Defendant-Appellee.
____________________________________________________
Appeal from the United States District Court
for the Western District of Texas
_____________________________________________________
(August 24, 1994)
Before WISDOM, BARKSDALE, and EMILIO M. GARZA, Circuit Judges.
RHESA HAWKINS BARKSDALE, Circuit Judge:
These appeals present an issue of first impression in our
circuit: the limitations period for an action under the Worker
Adjustment and Retraining Notification Act (WARN), 29 U.S.C. §§
2101-2109. Both district courts applied the six-month period
provided by § 10(b) of the National Labor Relations Act (NLRA), 29
U.S.C. § 160(b). We AFFIRM.
I.
Two of the actions (Halkias' and Cureington's) are against
General Dynamics Corporation; one (Staudt's), against Glastron,
Inc. They concern not receiving timely notice in advance of a
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layoff, contrary to WARN, referred to by many as a "plant closing"
law. E.g., 134 Cong. Rec. S8546 (June 24, 1988) (Senator
Grassley); id. at S8665 (June 28, 1988) (Senator Specter).1
WARN requires a business that employs more than 100 workers to
provide at least 60 days' written notice before a "plant closing"
or a "mass layoff". 29 U.S.C. §§ 2101-02; see also id. §
2101(a)(3)-(4) (defining "plant closing" and "mass layoff").
Failure to provide such notice results in the business' liability
to those who suffered an "employment loss" for back pay and
benefits for each day of the violation. Id. § 2104(a)(1); see also
id. § 2101(a)(6) (defining "employment loss" as termination, layoff
exceeding six months, or reduction of hours of work by more than 50
percent for six months). WARN provides for a federal action to
recover these damages, 29 U.S.C. § 2104(a)(5), but does not include
a limitations period.
A.
1.
On January 7, 1991, the Department of Defense cancelled a
contract with General Dynamics, prompting it, one day later, to
institute a "mass layoff" at its facilities in Texas, Oklahoma, and
1
Although WARN is referred to as a "plant closing" law, it is
not addressed solely to the permanent closing of plants. First, it
addresses temporary closings. See 29 U.S.C. §§ 2101(a)(2),
2102(a). Second, and more important, it addresses "mass layoffs"
that result from far less than plant closure. See 29 U.S.C. §§
2101(a)(3), 2102(a); see also infra, note 2. Nevertheless, the
dissent treats WARN as if it governed only plant closings, and this
treatment drives its conclusions. See infra, note 18.
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Missouri.2 Halkias was one of the affected employees at the Fort
Worth, Texas, facility. Almost two years later, on November 24,
1992, he and other General Dynamics employees at the Fort Worth and
Oklahoma (Tulsa) facilities filed a class action in district court,
claiming that they were laid off in violation of WARN.3 In its
final form, the action was on behalf of approximately 2,000 former
salaried, non-union General Dynamics employees at the two
facilities.4
General Dynamics moved for judgment on the pleadings,
asserting that the six-month limitations period applicable to
2
WARN generally defines a "mass layoff" as a reduction in force
that is not the result of a plant closing and results in either an
employment loss at a single site for at least 33 percent of the
employees (provided that at least 50 employees suffer an employment
loss), or 500 employees. See 29 U.S.C. § 2101(a)(3).
3
According to General Dynamics, different plaintiffs commenced
a WARN action in the Eastern District of Missouri within 10 days of
the January 8, 1991, layoff. Halkias attempted to intervene in
that action on May 4, 1992; however, that July, his motion to
intervene was denied as untimely. Although neither the motion nor
the order is part of the record, Halkias does not dispute General
Dynamics' statement. Halkias instituted his action five months
after the denial of his motion to intervene in the Missouri action
(which was filed more than one year after the layoff).
4
The district court certified the class as:
Each person (i) who has been an employee of General
Dynamics Corporation (ii) who, at the time of the
termination of his or her employment for General
Dynamics Corporation, was not represented by a
union, (iii) who, at that time was employed at
either the Fort Worth, Texas, plant or the Tulsa,
Oklahoma, plant of General Dynamics Corporation,
(iv) whose employment was involuntarily terminated
between the dates January 7, 1991, and March 1,
1991, and (v) who did not receive written notice of
his or her termination of employment at least sixty
(60) days prior to such termination.
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unfair labor practice claims under § 10(b) of the NLRA, 29 U.S.C.
§ 160(b), should be borrowed, and if so, Halkias' action was time-
barred. The district court agreed.
2.
Cureington's appeal arises out of the same facts; indeed, the
parties to his action agreed to transfer it to the district court
adjudicating Halkias', because the claim was identical to, and
embraced by, Halkias' class action.5 Although Cureington's action
was never formally consolidated with Halkias', the district court
dismissed Cureington's complaint sua sponte, because he failed to
file within the six-month period.
B.
Staudt's class action against Glastron alleged that it "laid
off" over 250 employees at its New Braunfels, Texas, facility
between October 31 and December 31, 1990; but Staudt did not file
suit until December 17, 1992, approximately two years later.6
Glastron's motion to dismiss, on the basis that the action was
barred by the limitations period that should be borrowed from the
NLRA, was granted.
5
Cureington filed suit in state court on January 4, 1993,
nearly two months after Halkias filed his. General Dynamics
removed the case to district court.
6
Staudt states in his brief that the employees were non-union,
and advances this as one of the reasons for not adopting the NLRA
period. The record, however, is silent on this non-union claim,
but Glastron does not dispute it. As discussed infra, we give no
weight to union status vel non for fixing the appropriate
limitations period.
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II.
As noted, we address an issue of first impression for our
court: the WARN limitations period.7 District courts addressing it
are divided: like the district courts in these cases, some have
applied the NLRA's six-month period;8 others, state limitations
periods.9 The Second and Third Circuits, which are the only other
circuits to have addressed this issue, rejected the NLRA period and
held that a state limitations period was appropriate. United
Steelworkers of Am. v. Crown Cork & Seal Co., Nos. 93-2008 and 93-
7613, 1994 WL 415139, 1994 U.S. App. LEXIS 21132 (3d Cir. Aug. 10,
1994); United Paperworkers Local 340 v. Specialty Paperboard, Inc.,
999 F.2d 51, 57 (2d Cir. 1993). Most reluctantly, we part company
7
At various places in his briefs, Halkias seems to question the
propriety of utilizing Fed. R. Civ. P. 12(c) (allowing entry of a
"judgment on the pleadings") as a vehicle for dismissing his
complaint; however, he never explicitly contends that a dismissal
under Rule 12(c) was inappropriate. Therefore, we do not consider
this issue to have been raised.
8
E.g., Newspaper & Mail Deliverers' Union v. United Magazine
Co., 809 F. Supp. 185, 188-92 (E.D.N.Y. 1992); Thomas v. North Star
Steel Co., 838 F. Supp. 970, 972-75 (M.D. Pa. 1993), rev'd sub nom.
United Steelworkers of Am. v. Crown Cork & Seal Co., Nos. 93-2008
and 93-7613, 1994 WL 415139, 1994 U.S. App. LEXIS 21132 (3d Cir.
Aug. 10, 1994).
9
E.g., United Steelworkers of Am. v. Crown Cork & Seal Co., 833
F. Supp. 467, 467-70 (E.D. Pa. 1993), aff'd, Nos. 93-2008 and 93-
7613, 1994 WL 415139, 1994 U.S. App. LEXIS 21132; Automobile
Mechanics' Local No. 701 v. Santa Fe Terminal Serv., Inc., 830 F.
Supp. 432, 435-37 (N.D. Ill. 1993); Wholesale & Retail Food
Distrib. Local 63 v. Santa Fe Terminal Serv., Inc., 826 F. Supp.
326, 329-31 (C.D. Cal. 1993) (applying California limitations
period after determining that defendants waived limitations defense
pursuant to NLRA); Frymire v. Ampex Corp., 821 F. Supp. 651, 653-55
(D. Colo. 1993); Wallace v. Detroit Coke Corp., 818 F. Supp. 192,
194-97 (E.D. Mich. 1993).
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with our sister circuits, and hold that the NLRA period should be
applied.
A.
Congress' failure to provide a limitations period for WARN "is
often the case in federal civil law". DelCostello v. International
Bhd. of Teamsters, 462 U.S. 151, 158 (1983). In such a case,
we do not ordinarily assume that Congress intended
that there be no time limit on actions at all;
rather, our task is to "borrow" the most suitable
statute or other rule of timeliness from some other
source. We have generally concluded that Congress
intended that the courts apply the most closely
analogous statute of limitations under state law.
Id. (footnote omitted). The task of borrowing an appropriate
limitations period has been accurately characterized as "a matter
of which round peg to stuff in a square hole." Short v. Belleville
Shoe Mfg. Co., 908 F.2d 1385, 1393 (7th Cir. 1990) (Posner, J.,
concurring), cert. denied, 111 S. Ct. 2887 (1991). Due to the many
competing reasons for borrowing various periods, this case is no
exception. Indeed, it is a classic example.
Complicating our task is the need to consider whether a
federal limitations period provides a superior vehicle for WARN's
enforcement. See DelCostello, 462 U.S. at 162 ("state statutes of
limitations can be unsatisfactory vehicles for the enforcement of
federal law"). To be sure, the Court continues to caution that
"resort to state law remains the norm for borrowing of limitations
periods." Id. at 171; accord Lampf, Pleva, Lipkind, Prupis &
Petigrow v. Gilbertson, 111 S. Ct. 2773, 2778 (1991) (plurality)
("It is the usual rule that when Congress has failed to provide a
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statute of limitations for a federal cause of action, a court
``borrows' or ``absorbs' the local time limitation most analogous to
the case at hand.") (citations omitted).10 But, under appropriate
conditions, we may look to federal law to borrow the period.11 The
10
This usual rule has its genesis in the Rules of Decision Act,
28 U.S.C. § 1652, originally enacted in 1789, which provides:
The laws of the several states, except where the
Constitution or treaties of the United States or
Acts of Congress otherwise require or provide,
shall be regarded as rules of decision in civil
actions in the courts of the United States, in
cases where they apply.
See Lampf, 111 S. Ct. at 2778 (plurality) (discussing source of
state borrowing principle); see also DelCostello, 462 U.S. at 159
n.13:
As we recognized in [Auto Workers v.] Hoosier
[Cardinal Corp.], 383 U.S. [696,] 701 [(1966)], the
choice of a limitations period for a federal cause
of action is itself a question of federal law. If
the answer to that question (based on the policies
and requirements of the underlying cause of action)
is that a timeliness rule drawn from elsewhere in
federal law should be applied, then the Rules of
Decision Act is inapplicable by its own terms.
11
The "norm" of borrowing state limitations periods has been
subject to steady erosion. Discussing Lampf, one commentator noted
that "the Court furthered a decade-long drift away from the
traditional practice of ``borrowing' the statute of limitations of
the forum state's most analogous cause of action and moved towards
the adoption of uniform national rules." The Supreme Court, 1990
Term -- Leading Cases, 105 Harv. L. Rev. 177, 400 (1991). In many
respects, this erosion reflects the endorsement of a view once held
only in dissent. See Hoosier Cardinal, 383 U.S. at 709-14 (White,
J., dissenting). For obvious reasons, this movement towards
uniform, national limitations periods for federal causes of action
has much to recommend it. See Leading Cases, supra, at 409 ("The
policies advanced by adopting uniform limitations periods --
certainty, predictability, and minimization of litigation -- would
be promoted by uniform periods for all federal statutes. In an age
of multistate activity largely regulated by federal rather than
state law, the state borrowing rule may be an anachronism.").
The dissent contends that the Leading Cases note "in actuality
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Court has stated that:
when a rule from elsewhere in federal law clearly
provides a closer analogy than available state
statutes, and when the federal policies at stake
and the practicalities of litigation make that rule
a significantly more appropriate vehicle for
interstitial lawmaking, we have not hesitated to
turn away from state law.
DelCostello, 462 U.S. at 172; accord Lampf, 111 S. Ct. at 2778
(plurality).
Consistent with the trend towards utilization of federal
limitations periods, discussed in note 11, supra, our court has
borrowed the NLRA's limitations period in a number of cases since
DelCostello. See, e.g., Landry v. Air Line Pilots Ass'n, 901 F.2d
404, 410-14 (5th Cir.) (applying period to claim for breach of duty
of fair representation under Railway Labor Act), cert. denied, 498
U.S. 895 (1990); Trial v. Atchison, T. & S.F. Ry., 896 F.2d 120,
124-26 (5th Cir. 1990) (same); Aluminum, Brick & Glassworkers Int'l
Union Local 674 v. A.P. Green Refractories, Inc., 895 F.2d 1053,
1054-55 (5th Cir. 1990) (applying period to "pure" § 301 actions
under Labor Management Relations Act); Coyle v. Brotherhood of Ry.,
Airline, & S.S. Clerks, 838 F.2d 1404, 1405-06 (5th Cir. 1988)
(applying period to breach of contract claim against union under §
2 of Railway Labor Act).
supports [its] conclusion". Dissent at 19 n.48. If its conclusion
is that the state borrowing rule is still the usual rule, then we
agree. On the other hand, if it believes that the note supports
the dissent's conclusion that the existence of a "trend away from
the state borrowing rule is pure conjecture", then we disagree.
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The decision to apply a federal, rather than a state, period
is a "delicate" one. See Lampf, 111 S. Ct. at 2778 (plurality).
In DelCostello, the Court selected the NLRA's limitations period
after giving due consideration to whether the state period might
hinder the federal policy at issue, DelCostello, 462 U.S. at 162-
69, and noting the "family resemblance" between the federal statute
at issue and the NLRA. Id. at 170-71. In Agency Holding Corp. v.
Malley-Duff & Assoc., Inc., 483 U.S. 143 (1987), the Court
considered whether a uniform period is desirable, id. at 148-49,
and whether a federal statute provided a "far closer analogy ...
than any state law alternative", paying particular attention to the
"similarities in purpose and structure" between the two federal
statutes. Id. at 150, 152. It also focused on litigation
practicalities, particularly the potential for forum shopping
generated by application of diverse state periods. Id. at 153-54.
In Lampf, a plurality of the Court attempted to promulgate a
three-tier "hierarchical inquiry for ascertaining the appropriate
limitations period". Lampf, 111 S. Ct. at 2778-79 (plurality).
Following this approach, one first decides "whether a uniform
statute of limitations is to be selected", regardless of whether
that uniform period is to be a particular species of state periods
or a single, federal one. Id. at 2779 (plurality). If uniformity
is desirable, one next chooses either a species of state
limitations periods or a federal period, paying particular
attention to "the geographic character of the claim" and forum
shopping concerns. Id. (plurality). Finally, even if such
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considerations counsel in favor of the federal period, one must
still decide that the "federal source truly affords a ``closer fit'
with the cause of action at issue than does any available state-law
source." Id. (plurality).
Although the Lampf hierarchy commanded only a plurality,12 its
structure is consistent with the earlier approach of eight members
of the Court in Agency Holding. On the other hand, the Court has
borrowed a federal period without first explicitly ascertaining the
need for uniformity. See DelCostello, 462 U.S. at 165-71. In
fact, the discussion in Agency Holding of the desirability of a
uniform period for RICO claims may be embraced as a component of
DelCostello's dictate that "litigation practicalities" and policy
implications be considered. See Agency Holding, 483 U.S. at 149-50
("a uniform statute of limitations is required to avoid intolerable
uncertainty and time-consuming litigation") (internal quotations
and citation omitted); DelCostello, 462 U.S. at 172 (identifying
"litigation practicalities" and the effects on federal policy as
factors in choosing a federal limitations period). Accordingly, we
12
The dissent charges that "[t]he language in Lampf pronouncing
the state borrowing rule alive and well did not command ``only a
plurality', as the majority and General Dynamics would have us
believe." Dissent at 3-4 (footnote omitted). That charge is
predicated on a misconstruction; we merely state that "the Lampf
hierarchy commanded only a plurality". At no point do we suggest
that "only a plurality" of the Court believes that state borrowing
rule is anything but the "usual" rule; however, part IIA of the
Lampf opinion was, in fact, joined by only four justices. And,
only those four justices expressly agreed with the "hierarchical
inquiry" distilled in part IIA for determining whether a federal
limitations period should be borrowed; no other justice wrote to
express a similar view. In any event, as discussed infra, we
approach our inquiry through a harmonious reading of DelCostello,
Lampf, and other Supreme Court precedent.
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follow DelCostello's general outline, recognizing that subsequent
cases have elaborated on that theme.
B.
We first examine whether the NLRA limitations period is more
analogous to WARN than available state periods. See DelCostello,
462 U.S. at 172 (requiring that the federal period provide a
"closer analogy than available state statutes"). To undertake this
examination, we first describe the similarities between the NLRA
and WARN, and then compare and contrast those similarities with the
available state period(s).13
13
The dissent takes vigorous exception to the order of our
presentation, believing that Lampf mandates that we first address
the state limitations period. Dissent at 4. As to Lampf's
teachings, we are unable to distill the same meaning from the
Court's words that the dissent does. Nowhere does Lampf state that
federal courts, when confronted with the suggestion that a federal
limitations period is more appropriate than a state period, must
first address the relevant state period. Instead, Lampf, quoting
DelCostello, invites a comparison: federal borrowing is "to be
made only when a rule from elsewhere in federal law clearly
provides a closer analogy ..., and when the federal policies at
stake and the practicalities of litigation make that rule a
significantly more appropriate vehicle for interstitial lawmaking."
Lampf, 111 S. Ct. at 2778 (plurality) (emphasis added; citations
and internal quotation marks omitted). Obviously, this comparison
involves ascertaining the closeness of both the proposed federal
and state periods to the cause of action in issue, and then
comparing their fit. Whether one first looks to the state or to
the federal period, the resulting inquiry is still the same. Of
interest, the Lampf opinion itself did not even consider state law
alternatives, because it found "an express limitations period for
correlative remedies within the same [federal] enactment." Id. at
2782 (majority opinion) (footnote omitted). We do not read this to
mean that "Lampf suggests that the only time a court can go
straight to federal law is ``where Congress has provided an express
limitations period for correlative remedies within the same
enactment.'" Dissent at 5 (footnote omitted). In fact, the
Supreme Court in Agency Holding addressed the similarities between
RICO and the Clayton Act prior to discussing "the lack of any
satisfactory state law analogue to RICO" and rejecting the
application of a state "catchall" limitations period. See Agency
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1.
Agency Holding, which held that the Clayton Act's limitations
period was applicable to RICO claims, noted that those acts shared
"similarities in purpose and structure". Agency Holding, 483 U.S.
at 152. The same can be said of the NLRA and WARN.
WARN "requires some employers -- generally those who are
curtailing or closing an operation -- to provide sixty days notice
to those employees who will be laid off or whose hours will be
substantially reduced." Carpenters Dist. Council v. Dillard Dep't
Stores, Inc., 15 F.3d 1275, 1278 (5th Cir. 1994).14 It imposes this
requirement to provide employees an opportunity to look for other
jobs or seek retraining. See 20 C.F.R. § 639.1(a) (1993).
"[T]he NLRA ... [was] enacted to protect the right of workers
to join together ... and collectively bargain for the terms and
conditions of employment." United Paperworkers, 999 F.2d at 54;
see also 29 U.S.C. § 151. To provide such protection, the NLRA,
among other things, "conferr[ed] certain affirmative rights on
employees and [placed] certain enumerated restrictions on the
activities of employers." American Ship Bldg. Co. v. NLRB, 380
U.S. 300, 316 (1965). For example, § 8(a) of the NLRA proscribes
"unfair labor practices" by employers. See 29 U.S.C. § 158(a).
Unquestionably, WARN and the NLRA share similar structures;
Holding, 483 U.S. at 146-53.
14
In Carpenters, our court disagreed with the Third Circuit on
an aspect of WARN's damages provision. Id. at 1282-86 (disagreeing
with Third Circuit's holding that WARN's remedial provision
requires "back pay" for each calendar day of violation; calculating
damages based only on work days within violation period).
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"the family resemblance is undeniable, and indeed there is a
substantial overlap" between them. See DelCostello, 462 U.S. at
170 (not discussing WARN). In fact, the Department of Labor15
borrowed extensively from the NLRA in promulgating regulations for
WARN. See 20 C.F.R. § 639.3(d) (1993) (defining "representative"
for WARN purposes by explicit reference to §§ 9(a) and 8(b) of the
NLRA); 20 C.F.R. § 639.3(a)(1)(ii) (1993) (defining "reasonable
expectation of recall"); 20 C.F.R. § 639.3(a)(2) (1993) (defining
"independent contractors and subsidiaries" by reference to
"existing legal rules", i.e., case law interpreting the NLRA); see
also 54 Fed. Reg. 16,045 (1989) (explicitly looking to NLRA for
guidance in promulgating 20 C.F.R. § 639.3(a)(2) definition of
"independent contractors and subsidiaries"); 54 Fed. Reg. 16,044-45
(1989) (discussing promulgation of "reasonable expectation of
recall" language in 20 C.F.R. § 639.3(a)(1)(i) by referring to NLRA
case law). After WARN's enactment, the NLRB's General Counsel
"predicted substantial interplay between the new law [(WARN)] ...
and the nation's basic labor law administered by the NLRB." NLRB
General Counsel Outlines Overlap Between Plant Closing Law and
Taft-Hartley, 226 Daily Lab. Rep. (BNA), Nov. 23, 1988, at A-3.16
15
It is significant that the Department of Labor administers
WARN. In holding that a claim under the Employee Protection
Program of the Airline Deregulation Act should be subject to the
NLRA's period, the Third Circuit noted that, "as with the NLRA, the
Department of Labor has had a role in administering the EPP".
Haggerty v. USAir, Inc., 952 F.2d 781, 787 (3d Cir. 1992).
16
Although the comments by NLRB General Counsel were far-
ranging, the following is illustrative:
I think the two statutes are intended by Congress
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Given the linguistic overlap between WARN and the NLRA, it is
not surprising that, like the Department of Labor, federal courts
have turned to NLRA case law in interpreting WARN. For example, in
Damron v. Rob Fork Mining Corp., 739 F. Supp. 341 (E.D. Ky. 1990),
aff'd, 945 F.2d 121 (6th Cir. 1991), the district court was
required to resolve "the extent to which laid off persons are to be
included in the calculation of ``employees' for purposes of the WARN
Act." Id. at 342. Its resolution of that issue followed the lead
of the Department of Labor and looked to the NLRA:
The specific WARN Act analysis requires a
determination of whether an employee would
"reasonably experience an employment loss". Rather
than await case law development of this phrase, the
Secretary [of Labor] adopted a substantially
similar analysis formulated under the National
Labor Relations Act by the National Labor Relations
Board's [NLRB] use of the "reasonable expectation
of recall" test. The NLRB case law interpretation
of that term, used in determining voter eligibility
for representation elections, could then be
utilized for the WARN Act. 54 Fed. Reg. 16,044.
The parties appear to agree with this
suggestion by the Secretary and it, likewise,
appears to this court to be an equally applicable
phrase in determining those persons to be counted
for WARN Act purposes.
Id. at 344. The Sixth Circuit affirmed, once again employing "the
NLRB analogy". See Damron, 945 F.2d at 124-25.
to operate essentially separately, but I think
because of the borrowing of concepts, one from the
other, and because of the impact on existing and
future collective bargaining relationships that
this statute requires ... it is inevitable that
there will be a fair amount of interplay between
the [two laws].
Id. (ellipses and brackets in original).
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The NLRA is more than just analogous to WARN; in fact, WARN
may be thought of as an outgrowth of the NLRA, because §§ 8(a)(1)
and 8(a)(5) of the NLRA, 29 U.S.C. § 158(a)(1), (5), have been
interpreted to require an employer to notify a union of its
decision to close a plant.
In order to meet its obligation to bargain
over the effects on employees of a decision to
close, an employer must conduct bargaining in a
meaningful manner and at a meaningful time. A
concomitant element of meaningful bargaining is
timely notice to the union of the decision to
close, so that good faith bargaining does not
become futile or impossible.
Penntech Papers, Inc. v. NLRB, 706 F.2d 18, 26 (1st Cir.)
(citations and internal quotations omitted), cert. denied, 464 U.S.
892 (1983); see also Metropolitan Teletronics Corp., 279 N.L.R.B.
957, 958-59 & n.14 (1986) (finding NLRA § 8(a)(5) violation because
of company's failure to notify union of decision to close and
relocate plant), enforced, 819 F.2d 1130 (2d Cir. 1987). In a
sense, WARN amends the NLRA by setting a specific time period for
notice, in addition to expanding coverage to all employees,
regardless of union status.
Furthermore, as noted, collective bargaining agreements
frequently require notice of layoffs, shutdowns, and the like. See
First Nat'l Maintenance Corp. v. NLRB, 452 U.S. 666, 684 (1981)
(describing that such provisions are "prevalent"); see also Dubuque
Packing Co., 303 N.L.R.B. 386, 394 n.23 (1991) (recognizing
collective bargaining agreement that required "6 months' notice be
given prior to closing"). Viewed from this perspective, WARN
merely codifies a frequent practice facilitated by the NLRA. In
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fact, the regulations implementing WARN provide:
The provisions of WARN do not supersede any laws or
collective bargaining agreements that provide for
additional notice or additional rights and
remedies. If such law or agreement provides for a
longer notice period, WARN notice shall run
concurrently with that additional notice period.
Collective bargaining agreements may be used to
clarify or amplify the terms and conditions of
WARN, but may not reduce WARN rights.
20 C.F.R. § 639.1(g) (1993). Thus, the Department of Labor's
regulation injects WARN into collective bargaining agreements, both
by providing that the WARN notice period automatically increases if
provided for by the agreement, and by allowing WARN's "terms and
conditions" to be clarified or amplified by the agreement.
These similarities notwithstanding, the Second Circuit held
that "the NLRA is not sufficiently analogous to override the
traditional assumption that a state limitations period should be
applied." United Paperworkers, 999 F.2d at 55. In comparing the
acts' purposes, it stated:
The purpose of WARN, unlike that of the NLRA, is
not to ensure labor peace but to alleviate the
distress associated with job loss for both the
workers and the community in which they live. This
is demonstrated by the provision in the statute of
causes of action for local governments as well as
for individual workers and unions. When a union
brings an action, it thus serves only as the
representative of the class of employees that has
been harmed. The NLRA, in contrast, does not
protect community interests in avoiding job loss.
Id. at 54; see also United Steelworkers, 1994 WL 415139, at *4,
1994 U.S. App. LEXIS 21132, at *15 (Third Circuit statement that
"WARN serves very broad societal goals -- to protect workers, their
families and their communities in the wake of potentially harmful
- 17 -
employment decisions."). Its rejection of the NLRA limitations
period hinged on one essential perceived difference between WARN
and the NLRA: the NLRA "specifically regulate[s] the collective
bargaining relationship", while WARN "remain[s] peripheral to that
concern." United Paperworkers, 999 F.2d at 55. It found that
"WARN, therefore, neither ``encourages nor discourages' collective
bargaining, thus differing in purpose from the NLRA." Id.; see
also United Steelworkers, 1994 WL 415139, at *4, 1994 U.S. App.
LEXIS 21132, at *14 (Third Circuit stating, at best, WARN has a
"tangential" effect on collective bargaining).
As noted, we disagree. A strict identity of purposes is not
a requisite for borrowing a limitations period from one federal
statute for use in another. To the contrary, a federal statute's
limitations period is to be borrowed if, among other things, it
"provides a closer analogy than available state statutes".
DelCostello, 462 F.2d at 171-72 (emphasis added); accord Lampf, 111
S. Ct. at 2779 (plurality) ("affords a ``closer fit' with the cause
of action at issue than does any available state-law source");
Agency Holding, 483 U.S. at 152 (relying, in part, on "similarities
in purpose and structure"). If an identity of purposes were
required, it would seem that the Court would not have borrowed the
Clayton Act's limitations period in establishing a uniform period
for RICO. See Agency Holding, 483 U.S. at 156.
The purposes of the NLRA are similar to those of WARN. Both
regulate labor-management relations: WARN, by requiring notice of
impending layoffs and terminations; the NLRA, by facilitating
- 18 -
concerted action by employees and governing collective bargaining
procedures. Both do so to achieve similar objectives. WARN's
broad purpose is to protect "workers, their families and
communities" by providing notice so that workers who will be
terminated may seek other jobs or retraining. 20 C.F.R. § 639.1(a)
(1993). The NLRA's stated purpose, though broader, embraces
similar objectives by "encouraging the practice and procedure of
collective bargaining ... for the purposes of negotiating the terms
and conditions of [workers'] employment or other mutual aid or
protection." 29 U.S.C. § 151. As discussed supra, this purpose is
achieved, in part, by the proscription of "unfair labor practices"
by employers. WARN's purpose may be seen as a subset of the
NLRA's: WARN provides a specific protection for workers by
requiring that employers render advance notice of terminations or
mass layoffs, while the NLRA generally defines and regulates the
relationship between employers and employees to promote peaceful
labor relations.17
In sum, WARN and the NLRA share similar language; they
undoubtedly overlap. In addition, they share similar, though by no
means identical, purposes. The "fit" is reasonably close.18
17
The dissent finds this comparison of purposes "weak". Dissent
at 12 n.32. We think this discussion, along with the other points
made in this section (several of which the dissent does not
address), to be far "more convincing than the fact that both were
passed by Congress." Id. at 12-13 n.32. This becomes all the more
apparent when one considers, as discussed, that the NLRA proscribes
conduct almost identical to that proscribed by WARN.
18
The dissent dismisses the relationship between the NLRA and
WARN, and does so for essentially one reason: its disagreement
with our "shaky premise that the policy favoring the rapid
- 19 -
2.
The question remains, however, whether a state period provides
as close or closer "fit" to WARN than does the NLRA. Several Texas
limitations periods19 have been suggested by appellants and amici
curiae20 as proper analogies to WARN: Tex. Civ. Prac. & Rem. Code
resolution of labor disputes (presumably so that everyone can get
back to business) applies to a situation where the company has
closed a plant (and there will be no more business)." Dissent at
7. The dissent returns to this point again and again; a
particularly colorful reprise follows: "Once a plant has closed
... there can be no resolution of a labor dispute. The plant is
gone, workers are without jobs, the community is left reeling."
Dissent at 17-18.
There are several reasons why the policies of WARN would be
better served by application of the NLRA's six-month limitations
period, and these reasons are discussed infra, part II.C. For now,
four points will suffice. First, as noted, WARN is not merely a
plant closing law; it also governs "mass layoffs". Second, to the
extent WARN concerns itself with layoffs (in which there is an
ongoing business and the possibility that the affected employee may
be re-employed), the NLRA's six-month limitations period is
consistent with federal law's preference for rapidity in resolving
labor disputes -- even those having nothing at all to do with the
collective bargaining relationship. See infra, note 34 (discussing
Age Discrimination in Employment Act and Title VII claims). Third,
to the extent that WARN does concern itself with plant closings,
the need for promptness in asserting claims becomes even more
intense, as is discussed later. Fourth, the six-month NLRA period
does apply to any unfair practice claim under the NLRA which might
arise from a plant closing without notice; Congress did not create
a special limitations period for unfair labor practices connected
with a plant closing.
19
Although Halkias' action includes Oklahoma plaintiffs from
General Dynamics' Tulsa facility, no party suggests borrowing an
Oklahoma period. This lends credence to our concern, discussed
infra, that in a choice of law situation involving borrowing a
state limitations period, a district court will look to that of the
forum state.
20
A brief was filed on behalf of appellants by the following
amici curiae: Texas AFL-CIO, Oil Chemical and Atomic Workers,
United Mineworkers of America, Automobile Mechanics' Local No. 701,
NLG/Sugar Law Center for Economic and Social Justice, and the UAW.
- 20 -
§§ 16.003 (two-year tort statute), 16.004 (four-year breach of
contract statute), and 16.051 (four-year residual statute).
Conspicuously absent from these suggestions are persuasive
discussions of why any of these statutes contain appropriate
limitations periods for WARN. Halkias contends only that "[i]t is
clear that the applicable state statute of limitation should be
either" from the tort or contract statute. Likewise, Staudt
asserts (in his brief) that either the tort or contract limitations
period should be applied, although evidencing a preference for the
former, on the basis that the failure to give a WARN notice
"constitute[s] a taking or conversion of the employee's right to
continued employment."21 And, the amici avoid the issue altogether,
suggesting that all three periods are suitable candidates, but
requesting a remand for the district court to select the closest
one.22
a.
21
But, at oral argument, when asked which Texas period should be
applied, Staudt's counsel replied that he was "afraid you were
going to ask that". Although Staudt urged the tort period in his
brief, by oral argument, he evidently had changed his mind, stating
a preference for the residuary period, and expressly disavowing a
preference for the contracts period (the period selected by the
Second Circuit). Given the difficulty in identifying a single
Texas limitations period that is most analogous, we concur with a
sentiment expressed by the Third Circuit in its decision to apply
the NLRA's limitations period to actions under the Employee
Protection Program of the Airline Deregulation Act: "[I]t is not
easy to find a state limitations period that is an appropriate
analogy." Haggerty, 952 F.2d at 786.
22
We decline to do so. We review freely, and rule on, legal
issues such as this; there is no reason to remand to district
courts that have already held that the NLRA presents a closer
analogy to WARN than any Texas period.
- 21 -
As for the tort period, we disagree with Staudt's assertion
that a WARN claim more closely resembles a claim for "conversion of
an employee's right to continued employment" than it does an action
under the NLRA. Texas is an employment at will State. E.g., Pease
v. Pakhoed Corp., 980 F.2d 995, 1000 (5th Cir. 1993). But, even
assuming that this is a tort in Texas, it presents a poor analogy
to a WARN claim. WARN has nothing to do with a right to continued
employment; it concerns only advance notice of an "employment
loss". Regardless of whether notice is given, the employer is free
to terminate or lay off the employee, or reduce his or her hours of
work. Likewise, WARN's resemblance, if any, to any other
traditional tort claim is nowhere near as obvious as its
resemblance to the NLRA.23
b.
The request that we apply Texas' residual statute, § 16.051,
may be quickly dismissed. As a general matter, the borrowing of a
"catchall" period is not favored. See Agency Holding, 483 U.S. at
152-53; Wilson v. Garcia, 471 U.S. 261, 278 (1985). More
specifically, it can hardly be said that § 16.051, which applies to
a tremendous diversity of claims, see Tex. Civ. Prac. & Rem. Code
Ann. § 16.051, Notes of Decisions (Vernon 1986), is as analogous,
or more analogous, to WARN than the NLRA is. See also Haggerty,
23
Tort claims exist to compensate an individual for an injury
proximately caused by the defendant. But, even if a terminated
worker in a WARN situation gets a higher paying job the day after
his termination, and therefore arguably has no "injury", WARN still
seems to provide for two months pay if the requisite notice was not
given. See 29 U.S.C. § 2104(a)(1-2), (7).
- 22 -
952 F.2d at 786 (finding that a state's residual limitations period
"offers no analogy [to the federal cause of action at issue], it is
simply a fallback position").
c.
Finally, the breach of contract limitations period, § 16.004,
likewise fails to provide as close an analogy to WARN as does the
NLRA.24 As noted, Texas is an employment at will State. After all,
as discussed, no contractual right to continued employment is
implicated by WARN.
In sum, canvassing the possible Texas periods reveals none as
analogous to WARN as the NLRA.25 None seeks to accommodate the
24
The breach of contract period may come closer than any other
Texas period. And, if nothing else, utilizing it would create some
semblance of uniformity, given the Second Circuit's borrowing a
state contract limitations period. But, the rationale utilized by
the Second Circuit in choosing this period does not necessarily
dictate the same result when Texas law supplies the period. The
Second Circuit reasoned that the contract period should govern
because it is the period for workers' compensation claims and
"wrongful discharge" claims in Vermont. United Paperworkers, 999
F.2d at 57. In Texas, however, a workers' compensation claim must
be submitted to the Texas Workers' Compensation Commission within
one year. Tex. Lab. Code. Ann. § 409.003 (West 1994). Texas'
traditional cause of action for wrongful discharge for asserting a
workers' compensation claim was subject to the two-year tort
limitations period. See Almazan v. United Services Auto. Ass'n,
840 S.W.2d 776, 779-80 (Tex. Ct. App. 1992) (discussing wrongful
discharge action under Tex. Rev. Civ. Stat. Ann. art. 8307(c) (West
1994) (repealed 1993)), error denied (March 3, 1993). Thus,
following the Second Circuit's reasoning may produce a very
different result in Texas than it did in Vermont, underscoring the
need for uniformity provided by borrowing the limitations period
from a federal statute.
25
The Third Circuit recognized that state law provided less than
a "perfect analogy". But, because the actions were timely under
any of the four potential state periods, it left unanswered which
of the four, ranging from two years to six years, is more analogous
to WARN than the NLRA. United Steelworkers, 1994 WL 415139, at *7
& n.5, 1994 U.S. App. LEXIS 21132, at *25-26 & n.5.
- 23 -
same, or very similar, interests as WARN, much less govern an
action that will frequently overlap with WARN.26 And, needless to
say, none embraces causes of action that share common language with
WARN.27
C.
Borrowing the NLRA period is supported by litigation
practicalities and policy considerations. See DelCostello, 462
U.S. at 172 (counseling use of more analogous federal limitations
period "when the federal policies at stake and the practicalities
of litigation make that rule a significantly more appropriate
vehicle for interstitial lawmaking").
1.
The first litigation practicality we consider is forum
shopping. See Lampf, 111 S. Ct. at 2779 (plurality); Agency
Holding, 483 U.S. at 154 ("the use of state statutes would present
the danger of forum shopping"). Raising this concern is the
breadth of WARN's venue provision, which permits an action to be
brought not only in "any district in which the violation is alleged
to have occurred", but also, in any district "in which the employer
transacts business". 29 U.S.C. § 2104(a)(5) (emphasis added). The
Second and Third Circuits were not as troubled as we by this
26
Recall, as discussed supra, that the NLRA has been interpreted
to require WARN-like notice.
27
General Dynamics suggests that if a Texas period is to apply,
it should be the six-month period under the Texas Pay Statute. See
Tex. Rev. Civ. Code Ann. art. 5155, § 5(a). This provision may be
more similar to WARN than those offered by appellants and amici;
however, it does not provide as close an analogy as does the NLRA.
WARN does not compensate for past services rendered.
- 24 -
generous venue provision, and the concomitant possibility that a
party could manipulate it through forum shopping. The Second
Circuit began its analysis of this issue by quoting the United
Paperworkers district court:
The term "plant closing" as defined by the Act is
limited to single sites of employment, and venue is
limited to the district where the violation is
alleged to have occurred or where the employer does
business; unless a single plant site straddles the
boundary between two states, it is unlikely
prospective plaintiffs will have a broad choice of
fora in which to bring their claims or that doubt
will arise as to in which state triggering events
occurred. Therefore, geographic considerations do
not counsel for the application of a uniform
federal limitations period for WARN Act claims.
United Paperworkers, 999 F.2d at 56 (citing and quoting district
court); see also United Steelworkers, 1994 WL 415139, at *6, 1994
U.S. App. LEXIS 21132, at *22 (Third Circuit relying upon the above
United Paperworkers quote to dismiss forum shopping concerns).
After endorsing the assertion that plaintiffs would not have "a
broad choice of fora" -- a conclusion somewhat at odds, it seems,
with the judicially-noticeable fact that many businesses with 100
or more employees28 "transact business" in more than one state --
the Second Circuit then quoted another district court for the
proposition that
choice of law rules would likely point to borrowing
the law of the site since that would be the place
of the injury, and probably the place of the
unlawful action as well. Therefore, it is unlikely
that a WARN plaintiff would be able to forum shop
28
WARN only applies to employers with "100 or more employees,
excluding part-time employees" or "100 or more employees who in the
aggregate work at least 4,000 hours per week". 29 U.S.C. §
2101(a)(1)(A-B).
- 25 -
for a locale with the most advantageous state of
limitations; the law of the site of the layoff
would likely be chosen no matter where the suit
happened to be filed.
United Paperworkers, 999 F.2d at 56 n.9 (citation omitted; emphasis
added). Choice of law rules appear, however, to pose greater
problems than this.
A WARN action is, of course, a federal question case. The
choice of laws issue that would be presented to a forum that does
not include the site of the WARN violation would be which state's
limitations period should be borrowed, and the outcome of that
inquiry seems by no means certain. A district court's choice of
law principles in a federal question case are derived from federal
common law, as the Second and Third Circuits have recognized.
Corporacion Venezolona de Fomento v. Vintero Sales Corp., 629 F.2d
786, 795 (2d Cir. 1980) ("This is a federal question case ... and
it is appropriate that we apply a federal common law choice of law
rule ..."), cert. denied, 449 U.S. 1080 (1981); see Gluck v. Unisys
Corp., 960 F.2d 1168, 1179 n.8 (3d Cir. 1992) ("A state court or
legislature does not necessarily seek to further or even consider
federal laws when it develops its choice of law provisions. A
federal choice of law rule would address those concerns."). If the
district court follows the forum state's choice of law principles
as a surrogate for federal common law, statutes of limitations are
viewed by many jurisdictions as "procedural"; and thus a forum will
follow its own period, regardless of the period that would apply in
the state in which the cause of action arose. See generally Eugene
F. Scoles & Peter Hay, Conflict of Laws §§ 3.9(b), 3.10, 3.11 at
- 26 -
58-64 (2d ed. 1992).29 This result, of course, would be completely
different from that suggested by the Second Circuit.30
Moreover, examining borrowing cases involving a conflict over which
state's limitation period should apply, we find a consistent
preference for borrowing the forum state's. See Wang Lab., Inc. v.
Kagan, 990 F.2d 1126, 1128 (9th Cir. 1993) ("In an ERISA case, we
ordinarily borrow the forum state's statute of limitations ....")
(emphasis added); Gluck, 960 F.2d at 1179-80 (after reviewing a
conflict regarding which state's statute of limitations should be
borrowed for an ERISA claim, court decides to "follow the general
rule and borrow a limitations period applicable to the forum state
claim most analogous to the ERISA claim ...") (emphasis added);
Champion Intern. Corp. v. United Paperworkers, 779 F.2d 328, 332-33
(6th Cir. 1985) (refusing to apply forum state's borrowing statute;
applying forum state's limitations period to federal cause of
action).
29
Texas courts generally describe statutes of limitations as
procedural and apply their own. See, e.g., Hollander v. Capon, 853
S.W.2d 723, 727 (Tex. Ct. App. 1993) ("The statute of limitations
is a procedural issue. If the action is barred by the statute of
limitations of the forum court in which the lawsuit is pending, no
action may be maintained even if the action is not barred in the
state where the cause of action arose.").
30
The dissent does not attempt rigorous analysis of what the
effect of choice of law rules would be; it merely states that the
"threat of forum shopping ... is stemmed by choice of law rules
which dictate that the law of the site of the layoff ... would be
chosen no matter where the suit was filed." Dissent at 16-17. To
support this conclusion, the dissent relies on the district court
opinion in Automobile Mechanics'. But, that opinion contains no
citation of authority for its sweeping statement that "choice of
law rules would likely point to borrowing the law of the site".
Automobile Mechanics', 830 F. Supp. at 436.
- 27 -
Augmenting the dangers that forum shopping may occur, and
highlighting the complexity of a federal court's decision as to
which limitations period should be borrowed, WARN claims could
involve several different states by virtue of the maintenance of a
class action. For instance, the district court certified Halkias'
class action, allowing him to press WARN claims from facilities in
both Texas and Oklahoma. Moreover, as discussed supra, there was
another potential forum, Missouri.31 Given the possibility for
multistate WARN litigation, the issue of which state's limitations
period should control might become an issue of time-consuming
litigation. And, it goes without saying, courts do not have time
to waste.
Considering, collectively, the likelihood of forum shopping,
and the possibility for multistate WARN class actions, the question
arises: Should federal courts even address themselves to the
vexatious question of which state's period should govern a WARN
claim, when the NLRA provides a uniform period? We think not. If
nothing else, valuable time and resources should not be consumed
litigating such issues. See Short, 908 F.2d at 1389 (discussing
pre-Lampf limitations period for securities fraud actions).32
31
Without deciding the issue, because it is not before us, a
class action for several different sites, each of which satisfies
WARN's "single site" requirement, appears to be appropriate when
the decision to close each site was simultaneous and arose out of
the same exigency. See 29 U.S.C. § 2101(a)(2) ("single site"
requirement); see also Fed. R. Civ. P. 23(a-b) (class action
requirements).
32
Short's discussion merits reiteration:
From the perspective of practitioners litigating
- 28 -
Accordingly, we conclude that a uniform, single limitations period
is desirable for WARN claims, a conclusion militating in favor of
applying the NLRA's.
2.
This conclusion is buttressed by resort to an examination of
WARN's policies, and the likely effect on those policies of
applying diverse, and often quite long, limitations periods. See
DelCostello, 462 U.S. at 172 (urging use of more analogous federal
limitations period "when the federal policies at stake ... make
that rule a significantly more appropriate vehicle for interstitial
lawmaking").
First, we recognize that federal labor policy has long favored
the rapid settlement of disputes between an employer and an
employee. In applying the NLRA's period to § 301 of the Labor
Management Relations Act, 29 U.S.C. § 185 (1988), the Seventh
Circuit reasoned that "[t]he six-month limitation period will
encourage prompt resolution of labor disputes." Hofmeister, 950
F.2d at 1348. Appellants urge that this rationale is inapplicable
cases originating in many states (especially class
actions), the situation is a nightmare. Lawyers
and courts alike devote untold hours to identifying
proper state analogies and applying multiple
(conflicting or cumulative) tolling doctrines.
"This uncertainty and lack of uniformity promote
forum shopping by plaintiffs and result in wholly
unjustified disparities in the rights of different
parties litigating identical claims in different
states. Neither plaintiffs nor defendants can
determine their rights with any certainty. Vast
amounts of judicial time and attorneys' fees are
wasted."
Short, 908 F.2d at 1389 (citation omitted).
- 29 -
to WARN, contending that although promptness is of unique concern
to the collective bargaining process, it is not applicable to
WARN's notice requirement.
We disagree. As the Seventh Circuit explained in rejecting a
similar argument against the application of the NLRA's period to
"``pure' section 301 actions":33 "The six-month limitations period
in section 10(b) was adopted in order to ``bar litigation over past
events "after records have been destroyed, witnesses have gone
elsewhere, and recollection of the events in question have become
dim and confused."'" Johnson v. Graphic Communications Int'l Union
Local 303, 930 F.2d 1178, 1182 (7th Cir.) (citing, inter alia,
Local Lodge No. 1424 v. NLRB, 362 U.S. 411, 419 (1960)), cert.
denied, 112 S. Ct. 184 (1991).34 This concern is no less present
in a WARN claim; indeed, given that WARN is often triggered by
plant closings or relocations, the need for prompt litigation is
even greater. Allowing a party several years in which to bring a
WARN claim could create untold problems concerning availability of
evidence.35
33
Referring to § 301 of the Labor-Management Act of 1947, 29
U.S.C. § 185.
34
In fact, federal law's preference for rapidity in labor
dispute resolution explicitly extends to areas that have nothing to
do with the collective bargaining process. See 29 U.S.C. §
626(d)(1) (180-day filing period before EEOC for claims under Age
Discrimination in Employment Act); 42 U.S.C. § 2000e-5(e)(1) (180-
day filing period with EEOC for Title VII claims).
35
Appellants protest that WARN claims are too difficult to
prepare within six months. We disagree; moreover, many WARN
plaintiffs have brought their claims within six months after the
accrual of their cause of action. See, e.g., Local 217, Hotel &
Restaurant Employees Union v. MHM, Inc., 976 F.2d 805, 807 (2d Cir.
- 30 -
1992) (within approximately five months of closing of hotel by
employer); Local 397, Int'l Union of Electronic, Electrical,
Salaried Mach. & Furniture Workers v. Midwest Fasteners, Inc., 763
F. Supp. 78, 80-81 (D.N.J. 1990) (within three months of plant
closing). Indeed, General Dynamics states that the Missouri action
was filed within 10 days of the layoffs at that facility. See
supra, note 3.
Likewise, we reject the suggestion that utilization of a six-
month period is incompatible with WARN's requirement that a
workload reduction or temporary layoff last more than six months
before becoming actionable. See 29 U.S.C. § 2101(a)(6) (defining
"employment loss" as termination, layoff exceeding six months, or
reduction in hours of work exceeding six months). The parties'
pleadings are less than clear on exactly what sort of "employment
loss" they suffered. If predicated on termination, their claims
accrued upon termination, see Automobile Mechanics', 830 F. Supp.
at 434; 29 U.S.C. § 2101(a)(6)(A), and a six-month limitations
period is not incompatible with such a situation. Because the
issue is not before us, we leave for another day when a WARN claim
accrues, particularly in the diminished workload or layoff
situation. Assuming, without deciding, that a layoff or reduced
workload must persist for six months before becoming actionable,
the limitations period would not begin to run until after that
period expired. See Automobile Mechanics', 830 F. Supp. at 434
(noting differences in time of accrual if claim is predicated on
termination or layoff; and, while accrual issue not clear from
pleadings, finding action would be timely whether claim arose from
layoff or termination). In any event, whether the appellants
suffered a layoff or a termination, their claims are untimely, in
light of the six-month limitations period we adopt. The question
that Halkias presents, "When does the layoff action accrue?", is
one that exists regardless of the length of the limitations period.
We also reject the suggestion that a six-month period is
unworkable because, unlike the NLRA, WARN does not provide a
"complex administrative structure" for pursuit of claims. See
United Paperworkers, 999 F.2d at 55. The Supreme Court has applied
the NLRA limitations period to actions brought by an employee
against his employer for breach of the collective bargaining
agreement and against his union (under § 301 of the Labor
Management Relations Act) for breach of the duty of fair
representation, see DelCostello, 462 U.S. at 154-55, 170-72; see
also Coyle, 838 F.2d at 1405 (discussing DelCostello; describing
action in DelCostello as a "hybrid action ... under § 301"), a
cause of action that requires some effort to bring because "the
employee will often be unsophisticated in collective-bargaining
matters .... He is called upon, within the limitations period, to
evaluate the adequacy of the union's representation, to retain
counsel, to investigate substantial matters ..., and to frame his
- 31 -
Moreover, as discussed supra, failure to give WARN notice
often may create a concurrent claim under the NLRA. When a claim
under one federal statute is also an "unfair labor practice under
the NLRA, it seems particularly appropriate to borrow the NLRA
limitations period." Hofmeister, 950 F.2d at 1348.
Finally, and most important, application of expansive
limitations periods would disserve WARN's most specific objective:
the provision of a cushion of time for employees to explore other
job opportunities and, if necessary, seek retraining. See 20
suit". DelCostello, 462 U.S. at 166. By contrast, a WARN
plaintiff need only know that he was terminated or laid off without
notice; provided his situation comports with the requisites of
WARN, he can sue. Indeed, the absence of a "complex administrative
structure" may be emblematic of the simplicity of a WARN claim,
rather than a justification for a lengthy limitations period.
The dissent emphasizes that the plaintiffs in these cases are
not represented by unions, and thus are deprived of "union legal
representation". As discussed supra, an employee bringing hybrid
§ 301 actions against his union for breach of the duty of fair
representation (and against his employer for breach of the
collective bargaining agreement) is, after DelCostello, required to
bring his claim within the NLRA's six-month limitations period.
And, as discussed, he faces obstacles at least as great as those
faced by one seeking to assert a simple WARN claim. Yet he, too,
will lack union legal representation.
The dissent similarly opines that we "hold[] the plaintiffs to
a deal they did not make: They suffer the six-month requirement
but benefit from no corresponding protection of their rights."
Dissent at 9 (footnote omitted). Of course, WARN confers specific
rights on workers, and provides remedies for their violation. It
is not as if workers after the enactment of WARN -- even with the
application of a six-month limitations period -- "benefit from no
corresponding protection of their rights."
The dissent prompts a question: Can anyone imagine that, with
"thousands of workers" in "distress" after a termination or layoff
without WARN notice, see dissent at 9, 12, a lawyer (or lawyers)
will not be far behind? This seems especially probable given
WARN's provision of attorneys' fees for prevailing parties. See 29
U.S.C. § 2104(a)(6).
- 32 -
C.F.R. § 639.1(a) (1993) ("Advance notice provides workers ... some
transition time to adjust to the prospective loss of employment, to
seek and obtain alternative jobs and, if necessary, to enter skill
training or retraining ...."). Obviously, providing funds to
workers several years after their termination does not serve that
objective. Cf. Lloyd v. Department of Labor, 637 F.2d 1267, 1270
(9th Cir. 1980) ("In order to serve the [Trade] Act's purposes of
retraining, adjustment, and relocation, it was important that
workers claim and receive benefits promptly after discharge. There
were also other advantages -- such as freshness of records and
other evidence -- to be gained by promptness.") (citations
omitted).36
36
Of course, prompt filing does not necessarily mean prompt
resolution. That will depend on numerous factors, including
discovery and the district court's caseload. But, obviously, the
sooner suit is filed, the sooner the resolution from the date of
the employment loss.
The dissent asserts that the application of a six-month period
would "stymie WARN's true objective". Dissent at 18. The reason
proffered for this assertion is that "companies can relax a bit and
rest assured that they may ``make redundant' many legally
unsophisticated and unsuspecting workers" with a six-month period,
while a longer period would deter violations of WARN. Obviously,
the rationale presupposes that an employer chooses not to comply
with WARN coldly and rationally. It is quite questionable that a
company would intentionally violate WARN in reliance on the
possibility that a worker would not sue. In fact, if just one
worker approaches a lawyer, then the possibility of a class action
becomes very real. In these circumstances, a decision to violate
WARN on the basis assumed by the dissent would be illogical.
Moreover, if this premise of the dissent has merit, one would
suspect that employers would "just relax a bit" regarding the
sexual harassment of, or age discrimination against, their "legally
unsophisticated and unsuspecting workers" because of the short
limitations periods attaching to Title VII or the Age
Discrimination in Employment Act. See supra note 34. Current
events suggest otherwise.
- 33 -
D.
Halkias and the amici urge that if we apply a federal
limitations period, it should be the four-year federal residual
period, 28 U.S.C. § 1658. But, by its terms, it applies only to "a
civil action arising under an Act of Congress enacted after the
date of the enactment of this section". Id. Section 1658 was
enacted on December 1, 1990, well after WARN's enactment. Compare
Pub. L. No. 101-650, 104 Stat. 5089, 5114-15 (1990) (§ 1658
enactment) with Pub. L. No. 100-379, 102 Stat. 890 (1988) (WARN
enacted on August 4, 1988).37
Despite § 1658's plain language, amici urge that we borrow it,
if we are to borrow federal law. Specifically, they contend that
§ 1658's legislative history indicates that Congress refused to
give it retroactive effect only because doing so would undermine
the settled expectations of parties in those instances where the
courts have already settled the limitations period issue.
Reasoning that WARN's limitations period has not been so settled,
they contend that we should borrow § 1658 despite its plain
language to the contrary.
In addition, the dissent invites a false choice. While the
borrowing of state limitations periods may in several states result
in long periods (so long that their application to a plant closing
or mass layoff seems inappropriate), a state limitations period
could be as short as the NLRA's, e.g., the six-month period of the
Texas pay statute, see supra note 27, dissent at 14 n.36, or
perhaps even shorter.
37
The enactment of § 1658 reflected concern by both Congress and
the Federal Courts Study Committee that the process of borrowing
limitations periods for federal causes of action was, to say the
least, problematic. See H.R. Rep. No. 734, 101st Cong., 2d Sess.
24 (1990), reprinted in 1990 U.S.C.C.A.N. 6860, 6870.
- 34 -
We refuse to reject that plain language. Moreover, we cannot
see how the federal residual statue presents a closer analogy to a
WARN claim than does the NLRA's six-month period. Also, the
application of § 1658 would undermine WARN's central purpose, by
discouraging the prompt resolution of WARN claims. For these
reasons, traditional borrowing principles do not favor application
of § 1658 to WARN claims.
E.
Halkias' last contention is that Congress violated the Fifth
Amendment by failing "to prescribe a limitation period for a WARN
Act violation", thereby requiring a plaintiff to "``guess' at which
statute the federal courts will ``borrow'".38 We assume Halkias does
not wish to invalidate WARN itself, inasmuch as that statute
provides the basis for his requested relief. Rather, we assume
that he wants to be excepted from the application of an unforeseen
limitations period. We see no need for such an exception.
Generally, Fifth Amendment due process is not affected by the
traditional practice of borrowing limitation periods. Cf. Agency
Holding, 483 U.S. at 157-65 (Scalia, J., concurring in judgment)
(tracing history of "borrowing" limitations periods). Indeed, the
borrowing of limitations periods is a normal component of statutory
interpretation, see DelCostello, 403 U.S. at 158-62; and a borrowed
federal limitations period has been applied by the Supreme Court to
the litigants before it. See Lampf, 111 S. Ct. at 2782; see also
38
He also contends that Congress likewise violated the
Fourteenth Amendment, which, by its terms, applies only to the
States.
- 35 -
Lampf, 111 S. Ct. at 2786 (O'Connor, J., dissenting) (objecting to
Court's application of newly-announced limitation period to "the
very case in which it announced the new rule").
This is not to say that we do not sympathize with Halkias'
underlying concern; we do. Indeed, the rationale of this
contention illustrates the necessity for a uniform limitations
period for WARN claims, a result we herald by adopting the NLRA's
six-month period.
III.
For the foregoing reasons, the judgments of the district
courts are
AFFIRMED.
WISDOM, Circuit Judge, dissenting.
This is a difficult case. Reasonable minds can disagree on
the proper outcome. To my mind, however, the United States Supreme
Court has provided a framework whose strictures dictate the result.
Because I find the majority's diligent attempt to escape that
outcome unconvincing, I respectfully dissent.
I.
The issue presented, as correctly framed by the majority, is
whether the district court erred in applying the six-month statute
of limitations from § 10(b) of the National Labor Relations Act
(NLRA)39 to the plaintiffs' claims under the Worker Adjustment and
Retraining Notification Act (WARN)40. This is not only a question
39
29 U.S.C. § 160(b).
40
29 U.S.C. §§ 2101-2109.
- 36 -
of first impression in this Circuit, we are the only Court of
Appeals to consider applying the NLRA's statute of limitations to
non-unionized WARN plaintiffs.41 The majority reluctantly parts
ways with the Second and Third Circuits on this question and holds
that the NLRA six-month limitations applies to WARN.42 I believe
that our sister circuits got it right.
I agree with the majority that this case presents a "classic
example" of "which round peg to stuff in a square hole". All three
consolidated appeals focus on the same task: We must fill in a
blank left by Congress, namely, what statute of limitations applies
to cases brought under the WARN? Whenever courts are left to a
task of this nature, they become part sleuth, part improvisor. The
truth is, we do not know what Congress would have preferred and,
so, are left with our best guess as to what would most closely
approach congressional intent -- if it had an intent on the
subject.
II.
The starting point in resolving the present issue is the
recent Supreme Court decision in Lampf, Pleva, Lipkind, Prupis &
Petigrow v. Gilbertson43. In that case, the Court held that, when
Congress creates a federal cause of action but does not include a
41
The certified class represented by John Halkias and Barry Jackson
consists of about two thousand non-unionized former employees of
General Dynamics's Fort Worth and Tulsa operations.
42
See United Paperworkers Local 340 v. Specialty Paperboard, Inc.,
999 F.2d 51, 53 (2nd Cir. 1993); United Steelworkers of Am. v.
Crown Cork & Seal Co., Nos. 93-2008 and 93-7613, 1994 WL 415139 (3d
Cir. Aug. 10, 1994).
43
501 U.S. __, 115 L. Ed. 2d 321, reh'g denied, 501 U.S. __, 115 L.
Ed. 2d 1109 (1991).
statute of limitations, the courts are to presume that Congress
intended for the analogous state statute of limitations to apply.44
The Supreme Court summarized this general rule as follows:
It is the usual rule that when Congress has failed to
provide a statute of limitations for a federal cause of
action, a court "borrows" or "absorbs" the local time
limitation most analogous to the case at hand. . . .
This rule is founded on the Rules of Decision Act which "has
enjoyed sufficient longevity that we may assume that, in enacting
remedial legislation, Congress ordinarily intends by its silence
that we borrow state law."45
This general rule is subject to a limited exception. If a
state statute of limitations would be "at odds with the purpose or
operation of federal substantive law", the courts should ignore the
state limitations period and instead borrow the most analogous
federal limitations period.46 This exception, however, remains
that; it is "a closely circumscribed exception" to the general rule
that state, not federal, limitations periods apply when Congress
fails to specify a limitations period for a federal cause of
action.47
Moreover, it is important to underscore that this exception
44
Id. at __, 115 L.Ed.2d at 331 (citations omitted).
45
Id.
46
DelCostello v. International Bd. of Teamsters, 462 U.S. 151, 161
(1983).
47
Lampf, 501 U.S. at __, 115 L.Ed.2d at 331-32 (quoting Reed v.
United Transportation Union, 488 U.S. 319, 324, 102 L. Ed. 2d 665
(1989)). See also, United Paperworkers, 999 F.2d at 53 ("[The]
Supreme Court has set forth limited circumstances under which it
might be preferable to borrow a federal limitations period").
- 38 -
applies only when the state statute of limitations would
"frustrate" the policies of WARN.48 This approach to the exception
makes sense for, as the DelCostello Court explained, it would be
"inappropriate to conclude that Congress would choose to adopt
state rules at odds with the purpose or operation of federal
substantive law".49 Unfortunately, the majority's decision deviates
dramatically from this established framework.
The language in Lampf pronouncing the state borrowing rule
alive and well did not command "only a plurality", as the majority
and General Dynamics would have us believe.50 In fact, a simple
head count proves the opposite. Four Justices joined in part II.A
of the Court's opinion from which the quoted rule comes. The
remaining Justices took positions even more hostile to General
Dynamics's position than Justice Blackmun's plurality opinion.51
48
Lampf, 501 U.S. __, 115 L.Ed.2d at 331.
49
DelCostello, 462 U.S. at 161.
50
Slip op. at 11.
51
Justice Scalia did not join part II.A of Justice Blackmun's
plurality opinion. In his concurring opinion, Justice Scalia said:
"In my view, absent a congressionally created limitations period
state periods govern, or if they are inconsistent with the purposes
of the federal act, no limitations period exists". Lampf, 501 U.S.
at ___, 115 L. Ed. 2d at 337 (Scalia, J., concurring) (emphasis
added). Justices Stevens and Souter dissented. Justice Stevens's
dissent explicitly disagrees with "[t]he Court's rejection of the
traditional rule of applying a state limitations period when the
federal statute is silent . . ." Id. at __, 115 L. Ed. 2d at 339
(Stevens, J., dissenting) (emphasis added). Finally, Justices
O'Connor and Kennedy dissented from the Court's refusal to make its
decision prospective only. Even they agreed, however, with the
view that the plaintiffs's "claims were governed by the state
statute of limitations for the most analogous state cause of
action". Id. at __, 115 L. Ed. 2d at 340 (O'Connor, J.,
dissenting) (emphasis in original).
- 39 -
The Court actually was unanimous in Lampf in expressing the view
that state statutes of limitation generally govern if Congress
attaches no limitations period to a federal cause of action.
III.
Lampf and DelCostello create a flow chart inquiry. We always
look to the state statute of limitations first to see if an
analogous state law exists.52 The majority's explanation of the
Lampf "hierarchy," however, places the choice between a federal and
state statute on par with one another, both subject to the criteria
of which provides the best fit in the light of forum shopping
concerns and the geographic character of the claim.
That is not Lampf's teaching. The hierarchy is vertical;
Lampf is clear that state statutes of limitations are the rule,
federal rules the exception. Courts do not make a simple choice
between the federal and state rules. If an analogous state statute
of limitations is found, it should be used, provided it is not at
odds with the federal substantive law.53 This approach embodies the
52
At oral argument a member of the panel asked counsel for General
Dynamics if it was true that the Court had to look to state law
first, before considering federal law. Counsel conceded the point.
The following exchange took place.
Judge: "When we write this, we have to go through the
state statutes first before we get to the federal
statutes".
Counsel: "I completely agree with that. That is the proper
analysis, there is no doubt."
53
The Court in Lampf cited both the DelCostello case and Agency
Holding Corp. v. Malley-Duff & Associates, Inc., 483 U.S. 143, 97
L. Ed. 2d 121 (1987) -- both of which the majority cites extensively
in support of its position -- for the proposition that federal law
may supply the suitable period "when the operation of a state
- 40 -
"presumption of state borrowing".54 In fact, Lampf suggests that
the only time a court can go straight to federal law is "where
Congress has provided an express limitations period for correlative
remedies within the same enactment."55 While that was precisely the
case in Lampf, it has nothing to do with the case at hand.
The majority's inverted approach is evidenced by its starting
point: "We first examine whether the NLRA limitations period is
more analogous to WARN than available state periods."56 That is not
the proper first step and dangerously misplaces the proper
emphasis. Instead, Lampf requires that we first select the most
analogous state period and determine whether it is at odds with the
federal substantive law. Hence, the majority's next statement that
it will "describe the similarities between the NLRA and WARN, and
then compare and contrast those similarities with the available
state period(s)" is a task improperly undertaken.57
limitations period would frustrate the policies embraced by the
federal enactment" (here, WARN). Id. at __, 115 L.Ed.2d at 331.
54
Id. at __, 115 L.Ed.2d at 332.
55
See Id. at __, 115 L.Ed.2d at 335-36. See also United Parcel
Service v. Mitchell, 451 U.S. 56, 68 n.4, 67 L. Ed. 2d 732, 744 n.4
(1981) (Stewart J., concurring) (state borrowing rule is more
appropriate when applied to a congressionally created cause of
action as opposed to an implied one).
56
Slip op. at 12.
57
Id. at 12. This mistake is repeated throughout the majority's
opinion. For example, after detailing its perceived similarities
in purpose and structure between WARN and the NLRA, the majority
then states: "The question remains, however, whether a state period
provides as close or closer 'fit' to WARN than does the NLRA." Id.
at 20. Again, the majority has the flow chart running in the wrong
direction. We first look to state law and, if it fits and is not
at odds with the federal statute, we use it.
- 41 -
IV.
Even taken on its own terms, however, the majority's opinion
cannot stand. The district courts relied on the mistaken
impression that WARN causes of action are analogous to lawsuits
brought under the NLRA and, accordingly, within the exception laid
down in DelCostello. The majority reiterates that assertion by
painting the NLRA and WARN as statutes with similar purposes and
structures. I disagree.
This case boils down to the length of time in which a
plaintiff may file suit. The main policy reason advanced by the
district courts for the restrictive six-month limit was the
national interest in the quick resolution of labor disputes.58
Unlike the NLRA, however, nothing in the cause of action created by
WARN requires or counsels in favor of an accelerated resolution.
Without explanation, the majority adopts the shaky premise that the
policy favoring the rapid resolution of labor disputes (presumably
so that everyone can get back to business) applies to a situation
where the company has closed a plant (and there will be no more
58
Judge McBryde's opinion quoted the following passage from Judge
Garcia's:
[T]he court concurs with the conclusion that "the federal
policy warranting rapid resolution of [labor and
employment] disputes favors the NLRA's shorter
limitations period; and that a standardized limitations
period would promote uniformity in enforcing the WARN
act."
Halkias v. General Dynamics Corp., 825 F. Supp. 123, 125 (N.D. Tex.
1993).
- 42 -
business).59
This is where the majority's statement that the statutes bear
a "family resemblance" breaks down. Even a cursory analysis
reveals the purposes of these statutes to be markedly different.
The reason for preferring rapid resolution of an ordinary labor
dispute is that when the dispute is resolved, employees will go
back to work, production will resume, the employer's sales will
increase, and the positive effects of the business on the overall
economy will return. Because strikes disrupt the status quo and
hurt the economy, it is important to minimize the economic damage
to the company and the community by ending them swiftly.
Understandably, the NLRA sets a comparatively short limitations
period (six months) as a means of doing achieving these goals.
Those considerations, unfortunately, have no place in a
scenario where WARN comes into play. When a WARN dispute is
resolved, the plant stays closed. Employees fired en masse stay
fired. Production does not resume. The economy does not return to
the status quo ante. Plant closings hurt the economy, but once the
closing occurs, the damage is done. Resolution of any resulting
WARN Act claims will not remedy that harm. In sum, there is no
59
The majority criticizes my dissent for failing to appreciate that
WARN governs not only plant closings, but mass layoffs and
temporary closings. See Slip op. at 3 n.1, 20 n.18. The severance
of the employment relationship and the repercussions that follow
are the same for the victim of a mass layoff as for one who loses
his job through a plant closing. That is true even if, in the case
of a layoff, the possibility of reuniting the fired employee and
the employer exists. Hence, my discussion of the different
purposes of WARN and the NLRA applies with equal force to all of
the job loss scenarios contemplated by WARN's provisions.
- 43 -
reason to require that they be rushed to resolution within six
months or not at all.
The Second Circuit recognized this fundamental distinction:
"The purpose of WARN, unlike that of the NLRA, is not to ensure
labor peace but to alleviate the distress associated with job loss
for both the workers and the community in which they live".60 No
reason to expedite those claims beyond what the state prescribes
for the most analogous state limitations period exists. It is
important to understand that this alleviation of distress comes
from the advance notice of the plant closing, not from the backpay
award that comes when a company fails to comply with WARN's
provisions.61 Moreover, we must remember that a plaintiff is not
paid the day he files suit. If he wins at trial and upon appeal,
his backpay award could be years away. The majority's decision
will compound -- not dissipate -- the distress that thousands of
workers experience annually.
The most severe aspect of the majority's holding is its
decision to subject the non-unionized employees in this case to the
60
See also, Crown Cork & Seal, 1994 WL 415139, at *4 (WARN'S
"broader purpose" is to "protect workers, their families and their
communities in the wake of potentially harmful employment
decisions".).
61
I make this distinction in response to General Dynamics's
assertion that the rapid resolution of disputes will better
alleviate the distress of job loss by ensuring that the statute's
remedies are promptly pursued. The statute presumably was passed
with the belief that proper advance notice would be given,
rendering the remedial provisions unnecessary in those cases.
- 44 -
strictures of the NLRA, the act governing collective bargaining.62
Returning to the round peg, square hole metaphor, this truly
baffles the laws of geometry. The NLRA protects the right to
bargain collectively but exacts as a price for that protection that
disputed cases be filed within six months. Yet, in this case, the
majority holds the plaintiffs to a deal they did not make: They
suffer the six-month requirement but benefit from no corresponding
protection of their rights.63
The Supreme Court has drawn an important distinction between
statutes that involve the collective bargaining process and those
that do not.64 For example, in DelCostello, the Supreme Court
stated that it would borrow a federal limitations period because of
the national concern for "stable bargaining relationships and
62
It bears emphasizing that the plaintiffs in both cases are not
represented by labor unions.
63
In this way, the present case is drastically different from the
statute at issue in Lampf. In Lampf, the Court held that a federal
statute of limitations applied to actions brought pursuant to Rule
10(b) of the Securities Exchange Act of 1934, 15 U.S.C. § 78j(b),
and Securities and Exchange Commission Rule 10(b)(5). The Court
looked to the contemporaneously enacted remedial provisions that
did supply a limitations period. See Lampf, 501 U.S. at __, 115
L.Ed.2d at 333-34. Hence, the Court had the benefit of the balance
struck by the Congress in limiting similar provisions of the same
act. Unfortunately, we are not presented with those circumstances.
64
The Second Circuit appreciated this distinction. In criticizing
the district court's Staudt decision now before us, the court in
United Paperworkers stated:
Those courts which have deemed the NLRA period most
applicable to WARN actions have failed to grasp this
crucial distinction between statutes which specifically
regulate the collective bargaining relationship and those
which remain peripheral to that concern.
United Paperworkers, 999 F.2d at 55.
- 45 -
finality of private settlements".65 The Reed case is equally
illustrative. The statute at issue there did not directly touch on
collective bargaining concerns and so the Court applied the usual
state limitations period.66 This distinction is well-founded, for
a plant closing law "provides protection to individual union and
non-union workers alike, and thus neither encourages nor
discourages the collective bargaining processes that are the
subject of the NLRA".67
The unfairness of applying the NLRA's limitations period to
non-unionized workers is magnified by the practical obstacles that
WARN plaintiffs face. Unionized plaintiffs presumably enjoy the
benefit of union protection and, probably, union legal
representation. The union will be well-versed in the applicable
statute of limitations for claims of that sort and the plaintiffs
will be advised accordingly. In other words, unionized WARN
plaintiffs can rest assured that the union "will handle it".
Non-unionized WARN plaintiffs, on the other hand, are unlikely
to have sufficient information to be able to bring suit within six
months.68 Whereas unions are readily able to determine whether a
65
DelCostello, 462 U.S. at 171 (citation omitted); United
Paperworkers, 999 F.2d at 53.
66
Reed, 488 U.S. at 394; United Paperworkers, 999 F.2d at 53-54.
67
Fort Halifax Packing Co., Inc. v. Coyne, 482 U.S. 1, 20-21, 96
L. Ed. 2d 1 (1987) (internal quotations omitted) (evaluating Maine
plant closing law).
68
WARN defines a "mass layoff" sufficient to invoke its terms as a
reduction in work force of (1) at least 33 percent of the employees
(excluding any part-time employees) and (2) at least 50 employees
(excluding any part-time employees); or at least 500 employees
- 46 -
sufficient number of their members had lost their jobs to invoke
WARN's remedies, non-union employees must learn about the scope of
a layoff by talking to co-workers and gradually compiling a list of
those affected. This will be a time-consuming laborious
undertaking.69
But workers will hardly be able to direct the energy and
attention necessary to that task -- they will be out hunting for
work. NLRA plaintiffs are preoccupied with going back to their
jobs with their company; WARN plaintiffs are preoccupied with
finding a new job to replace the one they just lost. The strain
they are under will be intense as they will be competing with the
perhaps thousands of others similarly situated for any scarce
employment opportunities. In spite of this all-too-real scenario,
the decision of the Court today requires that they file suit within
six months to get the backpay to which they are entitled, knowing
that the ultimate award if they win will be far away and
ineffective to help with their present needs.
Although the equities seem to me plain, this distinction goes
beyond a question of fairness, it is the core of our analysis. For
when the purpose of the NLRA is at odds with the purpose of WARN,
there is no way that the NLRA can provide a "closer fit" than an
(excluding any part-time employees). 29 U.S.C. § 2101(a)(3)(B).
69
The majority's response to the practical problems that the six-
month limitations period will cause is a statement that "many WARN
plaintiffs have brought their claims within six months. . . ."
Slip op. at 31 n.35. It is telling, however, that the cases the
majority cites for evidence of that proposition had unions for
plaintiffs. The majority never addresses the additional burdens
that non-unionized potential WARN plaintiffs face.
- 47 -
analogous state statute of limitations.
Not only is there no strict identity of purposes as the
majority reminds us is unnecessary, these are fundamentally
different statutes, enacted for very different reasons, creating
very different causes of action.70 The purpose of WARN is to give
employees advance notice of plant closings and a cause of action
when the employer fails to comply. The imposition of the NLRA
statute of limitations is at odds with that purpose in that it
unduly burdens potential WARN plaintiffs by making them pursue
those actions within a very tight time frame.
Comparing these statutes to the securities law at issue in
Lampf, where the Court did adopt a uniform federal limitations
period, is instructive. In Lampf, the Court was able to borrow the
federal limitations period from the remedial provisions passed by
the same Congress for the same purpose. Hence, the Court's task
was, in many ways, easier. Both the borrowed period and Rule 10(b)
were "to protect investors against manipulation of stock prices
through regulation of transactions upon securities exchanges. . .
." In Lampf, the Court's borrowed period had a near-identity of
purpose with Rule 10(b); we do not.
The majority opinion is no more convincing as to structure.
70
The majority's weak comparison of the statutes's purposes
implicitly concedes this. WARN's purpose is to protect workers and
their families by requiring notice, 20 C.F.R. § 639.1(a) (1993),
whereas the NLRA's purpose is to facilitate the process of
collective bargaining. 29 U.S.C. § 151. The majority's statement
that they are similar in that both "regulate labor-management
relations," slip op. at 19, is only slightly more convincing than
the fact that both were passed by Congress.
- 48 -
The majority incants the WARN regulations that the Department of
Labor borrowed from the NLRA, but fails to explain the significance
of that comparison. The borrowing of concepts is understandable:
both laws operate within the larger context of employer-employee
relations. The Department of Labor is the natural oversight agency
for both and the case law applicable to the interpretation of one
will likely be useful in construing the other. Still, that they
were born into the same extended family does not mean that they
bear a family resemblance.71
In conclusion, I would join the other Courts of Appeals to
have considered this issue -- the Second Circuit in United
Paperworkers and the Third Circuit in Crown Cork & Seal -- and hold
that WARN lawsuits should be governed by state limitations periods,
as suggested by a harmonious reading of Lampf and DelCostello.72
I, like those courts, believe that "[a] WARN cause of action does
not fit the limited circumstances under which a federal statute of
limitation should be applied".73
V.
The next step is to decide which state limitations period
ought to be borrowed. Although several Texas statutes have been
suggested, it is my feeling that the Texas statute of limitations
71
Cf. Crown Cork & Seal, 1994 WL 415139, *3 ("the mere fact that a
statute touches upon issues of labor law does not mean that the
Court must resort to the statute of limitations contained in §
10(b) of the NLRA").
72
United Paperworkers, 999 F.2d at 53-54.
73
Id. at 54.
- 49 -
for contract claims provides the best analogy.74 Under Tex. Civ.
Prac. & Rem. Code Ann. § 16.004, then, WARN plaintiffs would have
four years in which to institute their actions.
As all seem to agree, the fit will never be perfect; that is
why it is a question of which round peg to stuff in a square hole.
The Texas limitations period for contract claims works in that it
is the most analogous state statute.75 I view an action under WARN
as
essentially an action for damages caused by an alleged
breach of an employer's obligation. . . . Such an action
74
The other good candidates are:
(1) The two-year Texas limitations period for personal
injury, wrongful discharge, and employment discrimination
claims, Tex. Civ. Prac. & Rem. Code Ann. § 16.003;
(2) The four-year Texas residual statute of limitations, Id.
§ 16.051;
(3) The six-month limitations period of the Texas Pay
Statute, Tex. Rev. Civ. Stat. Ann. art. 5155; and
(4) The four-year federal residual statute of limitations
Congress recently enacted for all federal causes of
action that do not include their own limitations period,
28 U.S.C. § 1658.
At first glance, number (4) appears to cover exactly the
instant case. Unfortunately, as the majority correctly indicated,
§ 1658 by its terms applies only to "civil action[s] arising under
an Act of Congress enacted after the date of the enactment of this
section." Because WARN was enacted before § 1658, § 1658 does not
directly control in WARN cases. Several federal district courts
have recognized that § 1658 supersedes the Supreme Court's Lampf
analysis for causes of action filed after § 1658 took effect, but
because WARN preceded § 1658, the Supreme Court's Lampf analysis
governs this case.
75
See DelCostello, 462 U.S. at 171 ("[A]s the courts have often
discovered, there is not always an obvious state-law choice for
application to a given federal cause of action; yet resort to state
law remains the norm for borrowing of limitations periods.").
- 50 -
closely resembles an action for breach of contract
cognizable at common law.76
The Second Circuit in United Paperworkers agreed and applied
Vermont's six-year residual limitations period for all contract
claims.77 Even acknowledging that Texas is an employment-at-will
state, the backpay provisions of WARN resemble damages for a breach
of implied contract. Simply put, I perceive no evidence that the
Texas contract claim limitations period is at odds with WARN's
substantive provisions.78
VI.
Following the proper framework, we look last to whether
litigation practicalities and policy considerations make the use of
the NLRA limitations period "a significantly more appropriate
vehicle for interstitial lawmaking".79 The majority, raising the
specter of endless forum shopping among WARN litigants, concludes
that they do. I come out the other way.
To start, the forum shopping concerns raised by the majority
76
Auto Workers v. Hoosier Cardinal Corp., 383 U.S. 696, 705 n.7.
See also, Frymire v. Ampex Corp., 821 F. Supp. 651, 655 (D. Colo.
1993) (applying state contract statute of limitations to WARN
claim); Wallace v. Detroit Coke Corp., 818 F. Supp. 192, 196 (E.D.
Mich. 1993) (same).
77
United Paperworkers, 999 F.2d at 53, 57.
78
See Reed, 488 U.S. at 327; Frymire, 821 F. Supp. at 655. I note,
however, that I would have assented to a remand order to the
district court to find which state limitations period was most
appropriate.
79
DelCostello, 462 U.S. at 172. Though I do not wish to beat a dead
horse, I reiterate that studying the litigation practicalities and
policy considerations is our last task -- we reach it only if we
have found a state statute that is at odds with the operation of
WARN. That is not the case here.
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could be raised in reference to almost any federal law for which we
were considering borrowing a state limitations period. If
anything, WARN diminishes the threat of forum shopping.80 Any
threat of forum shopping that results from the right to file suit
wherever the employer does business is stemmed by choice of law
rules which dictate that the law of the site of the layoff (and,
thus, injury and violation) would be chosen no matter where the
suit was filed.81
We also examine the policy considerations to determine whether
WARN calls for a particular degree of uniformity. To me, they do
not. The Supreme Court in Auto Workers v. Hoosier Cardinal Corp.82
instructed that the value of uniformity is far greater under the
NLRA than under non-collective bargaining statutes. Even if we
concede that the subject matter of WARN is "peculiarly one that
calls for uniform law," national uniformity is less important
because WARN does not involve
those consensual processes that federal labor law is
chiefly designed to promote -- the formation of the
collective agreement and the private settlement of
disputes under it.83
WARN is decidedly not about collective bargaining. It is about
80
See United Paperworkers, 999 F.2d at 56 (forum shopping concerns
are not great because "plant closing" is limited to a single site
of employment and WARN actions will be filed where the injury took
place or the employer does business).
81
Auto Mechanics Local 701 v. Santa Fe Term. Serv., 830 F. Supp.
432, 436 (N.D. Ill. 1993).
82
383 U.S. 696, 701 (1966).
83
Id. at 702 (internal quotations omitted); DelCostello, 462 U.S.
at 162.
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what happens when there will be no more employer-employee
relationship and, thus, nothing left to bargain for.
The majority's other policy considerations are undercut by
experience and common sense. For example, the majority states that
the prompt resolution of labor disputes militates in favor of a
six-month limitations period. Once a plant has closed, however,
whether notice has been given or not, there can be no resolution of
a labor dispute. The plant is gone, workers are without jobs, the
community is left reeling. Although the majority is appropriately
concerned with the availability of witnesses and evidence down the
road,84 the state legislatures measure those concerns against other
public policy considerations when they enact their statutes of
limitations.
The majority also asserts that an expansive limitations period
would disserve WARN's objective of providing a time cushion in
which to seek other employment options. The majority states that
providing funds to workers several years later does not serve that
objective.85 The majority has confused time cushions.
The time in which to file suit is not the time cushion
Congress sought to give workers; the time cushion is the advance
notice that the workers would be losing their jobs. The workers
could then prepare for the coming changes while still collecting
their paychecks. Congress hoped that notice would be given (the
time cushion) and that these causes of action would never accrue.
84
Slip op. at 30.
85
Slip op. at 33.
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Once they have accrued, however, the restrictive six-month
limitations period serves to take away any remedial cushion that
workers might get in compensation for their injury.
Worse, the six-month time frame will actually serve to stymie
WARN's true objective of giving workers and communities advance
notice of impending hard times. By severely limiting the time
frame in which potential WARN plaintiffs may file suit, companies
can relax a bit and rest assured that they may "make redundant"
many legally unsophisticated and unsuspecting workers --
particularly non-unionized workers -- without suffering the
community backlash that will follow an announcement and, better,
without the threat of future litigation. An extended limitations
period, on the other hand, would function as a deterrent and, thus,
an enforcement mechanism.
VII.
The majority gives a detailed explication of the trend away
from borrowing state statutes of limitations in favor of uniform
national rules. Even if that trend does exist -- and I do not
concede that it does -- Lampf explicitly instructs that borrowing
state limitations period is still the law. I do not doubt that
uniform federal limitations periods might promote certainty,
predictability, and minimization, but Congress is well aware of
those values and yet frequently (as in this case) chooses to ignore
them and leave the question open. Hence, if the state borrowing
rule is truly becoming an anachronism, I will look to Congress, not
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to a law review, for evidence of its decline.86
86
At the risk of overkill, I note that the Harvard Law Review note
upon which the majority relies as support for this trend in
actuality supports my conclusion: "Writing for a plurality, Justice
Blackmun acknowledged the continuing validity of the state
borrowing rule." The Supreme Court, 1990 Term -- Leading Cases,
105 Harv. L. Rev. 177, 400 (1991). The article details that the
exception to this accepted rule is just as I have stated: when the
federal period "clearly provides a closer analogy" and when federal
policies at stake make the federal rule a "significantly more
appropriate vehicle" than the state rule. Id. Any reliance, then,
on some perceived trend away from the state borrowing rule is pure
conjecture, particularly in the face of the clean rule announced in
Lampf.
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VIII.
The plaintiffs, among countless others, have suffered the
indignity of losing their employment without notice -- in violation
of federal law.87 In seeking the redress to which Congress has made
them entitled, this Court has closed the gate on them one last
time, on a legal principle so tenuous in foundation, it appears as
but an academic exercise. Unfortunately for John Halkias, John
Cureington, and Alvin Straudt and thousands of other workers
similarly situated, it is anything but that.
Because I believe that the Court's decision today promotes
expediency and uniformity at the expense of the rights of workers,
I dissent.
87
WARN has no cruelty provision and, so, Glastron fired three
hundred employees on Christmas Eve.
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