National Labor Relations Board v. Newcor Bay City Division of Newcor, Inc. ( 2007 )

NOT RECOMMENDED FOR FULL-TEXT PUBLICATION
File Name: 07a0127n.06
Filed: February 15, 2007
No. 06-1285
UNITED STATES COURT OF APPEALS
FOR THE SIXTH CIRCUIT
National Labor Relations Board, )
)
Petitioner, )
)
v. ) ON APPLICATION FOR ENFORCEMENT
) OF AN ORDER OF THE NATIONAL
Newcor Bay City Division of Newcor, Inc., ) LABOR RELATIONS BOARD
)
Respondent. )
Before: BATCHELDER, GILMAN, and ROGERS, Circuit Judges.
ROGERS, Circuit Judge. The National Labor Relations Board seeks enforcement of the
Board’s November 8, 2005 Order. Acting on a charge filed by the International Union, United
Automobile, Aerospace and Agricultural Implement Workers of America, ALF-CIO, and Local 496
(“Union”), the Board’s general counsel issued a complaint alleging that Newcor committed unfair
labor practices when it unilaterally implemented its final contract proposal in the absence of a
bargaining impasse and failed to provide information requested by the Union in a timely fashion, in
violation of the National Labor Relations Act, 29 U.S.C. §§ 8(a)(5) and (1) (“the Act”). The ALJ
held that Newcor violated the Act by failing to provide the Union with requested pension
information in a timely fashion and by unilaterally implementing its final contract proposal when a
valid impasse did not exist. The Board affirmed the ALJ’s rulings, findings, and conclusions, and
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adopted the ALJ’s recommended order. Because the Board’s conclusions are supported by
substantial evidence, we grant enforcement of the Board’s order.
I. Background
Newcor designs and manufactures machinery at its Bay City, Michigan, facility. The Union
has been the collective bargaining representative for Newcor’s hourly employees for at least thirty
years and the most recently negotiated collective bargaining agreement (“CBA”) between the Union
and Newcor was set to expire at midnight on June 10, 2004. Five hours prior to the deadline and
after several bargaining sessions between the parties, Newcor representatives presented the Union
with a final proposal and stated that the proposal would be implemented the following day because
the parties had reached an impasse.
A. The Bargaining Sessions
The Union and Newcor met seven times during May and June 2004 to negotiate a new CBA.
The first bargaining session was held on May 11, 2004. At this meeting, Newcor representatives
made it clear to the Union that economic realities necessitated cuts in wages and benefits and
Newcor distributed a proposal to the Union that was, in the words of Scott Wright, Director of
Human Resources at Newcor, “ugly.” Among the concessions and cuts in Newcor’s initial proposal
was a 12% reduction in wages for bargaining unit employees; freezing of the pension plan, meaning
that current employees would get no credit for additional years of service and new employees would
be excluded from the plan; termination of supplemental pension payments, or “bridge money,” to
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retirees; elimination of dental and sickness/accident insurance; a less-generous health insurance plan;
an increase in employee contributions towards health insurance premiums; elimination of the
employer-subsidized “sub fund,” which provided payments to laid-off bargaining unit members; a
reduction in the number of paid holidays; a reduction in the number of vacation days for employees
with fifteen or more years seniority; and a reduction in benefits for sick, injured, and laid-off
employees.
The parties met again on May 20, 2004, and the Union committee presented its proposal.
The Union’s proposal sought increases in benefits, including an increase in wages; an increase in
pension benefits for retirees; a reduction in the penalty for early retirement; an increase in the size
of supplemental pension payments; an increase in dental benefits; an increase in the amount of
weekly accident/sickness payments; the elimination of health insurance co-payments; an increase
in the premium paid for night shift work; an increase in the employer-subsidized “sub fund” for
bargaining unit employees receiving unemployment compensation; additional paid holidays;
additional vacation days for employees with 30 or more years’ seniority; an extension of the
provision of health insurance benefits to laid off employees from two months to four months; and
an increase in the amount of life insurance coverage. A number of non-economic proposals was also
included.
Jim Nicoson, General Manager of Newcor, expressed his frustration with the Union’s
proposal in light of the need for concessions from the Union. Don Petro, a Union representative, told
the Newcor representatives that the Union committee had listened to Newcor’s proposal and that the
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Newcor representatives should listen to the Union’s proposal because it was merely a “starting point”
for negotiations. Petro suggested that the parties begin the negotiations by considering the
noneconomic issues in order to get the ball rolling on negotiations. By the end of the meeting, the
parties had tentatively agreed on a number of noneconomic issues, and the Union committee agreed
to withdraw some of its noneconomic proposals.
The parties met again on May 26 and June 3. During these bargaining sessions, the parties
discussed issues of health insurance and pension benefits. Although Newcor presented the Union
with information purporting to show the costs associated with wages and benefits, the Union
questioned the figures used by Newcor, especially the figures purporting to show the cost savings
associated with the concessions in Newcor’s proposal. For example, according to Newcor, the
biggest savings would come from the freeze of the pension plan and the elimination of supplemental
pension payments, which would reduce the hourly cost of the pension plan from $12.27 to zero.
When the Union committee questioned the figures, Nicoson responded that the figure of $12.27 “can
be any number we want it to be.”
At the fifth bargaining session on June 7, the Union presented a new proposal. Regarding
pay, the Union proposed a $1 per hour reduction in pay for bargaining unit employees with no
increases for four years, and a $4 per hour reduction in pay for new employees with no increases for
four years. The Union committee believed that the proposal would reduce costs in the near term
given some recent retirements, but Newcor’s representatives responded that such a proposal would
not result in immediate cost savings because a number of employees were still on layoff and had
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recall rights. On the issue of health insurance, the Union agreed to Newcor’s proposal that the old
plan be abandoned and accepted a cap on monthly, per-employee contributions to premiums made
by Newcor, although the caps proposed by the Union were higher than those proposed by Newcor.
The Union also proposed a cut in the period during which accident/sickness payments would be
made and agreed to an elimination of supplemental pension payments after January 1, 2008. The
Union proposed a new 401(k) program for new employees. The Union agreed to the elimination of
dental insurance, to a decrease the number of paid vacation days, and to a number of other
concessions, and eliminated some of its own demands. Nicoson responded that the concessions in
the Union’s proposal were not enough.
At the sixth bargaining session on June 9, 2004, the parties continued to discuss economic
issues and Nicoson told the Union committee that Newcor was not price competitive and that the
company needed the Union to agree to the company’s proposed concessions.
The final meeting of the parties took place on June 10. At the request of the Union
committee, Newcor representatives provided the committee with a document setting forth the
anticipated cost savings resulting from Newcor’s pension plan proposals. However, the information
did not address the Union’s interest in determining the costs associated with keeping the pension
plan in place given that a large number of bargaining unit members had recently retired. In response
to a request that the CBA be extended to accommodate further negotiations, Nicoson stated that the
parties needed to reach an agreement that day, that it would be detrimental for Newcor if customers
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knew that Newcor was operating without an agreement with its union, and that customers might take
their business elsewhere.
The Union committee met in an attempt to put together a new proposal, although the
committee thought that it was hindered by a lack of information from Newcor. At around 2 p.m.,
Nicoson and Wright asked the Union committee for its new proposal. Petro told them that the
committee was frustrated since it was trying to develop a new proposal without information it felt
it needed and Nicoson responded that the committee did not have any information requests
outstanding. Petro asked Wright what Newcor intended to do if the Union was unable to come up
with a new proposal because of a lack of information and Wright responded that Newcor would
implement its last proposal at midnight. This was the first mention of the possibility of impasse and
unilateral implementation.
The Union committee presented the Newcor representatives with a written information
request at this meeting because, according to Petro, the committee needed to document its requests
in light of the threat of unilateral implementation of Newcor’s proposal. The information request
stated that the requested information was needed to enable the Union to evaluate the company’s
proposals and that it would be difficult for the Union to develop proposals without the requested
information. The information request was for a variety of information, some of which had been
requested previously. Newcor representatives stated that they needed time to look over the request
and suggested that the parties take a break for dinner and reconvene at around 7 p.m.
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When the parties returned to the negotiating table at 7 p.m., the Newcor representatives
presented two documents to the Union committee. The first was a letter stating that “the negotiations
have reached the point at which any further bargaining at this time would be futile because the
positions of both Newcor and Local 496 are firm and are not close to agreement.” The letter also
disputed the Union’s claim that it needed more information. The second document was
“Management Final Proposal to UAW, Local 496, June 10, 2004.” Nicoson stated that the parties
were at impasse and that Newcor would implement its final proposal the next day upon expiration
of the existing CBA.
When Nicoson presented the final proposal, he was told by Jeffrey Ryan, a member of the
Union committee, that the parties were not at impasse and that the Union committee was still open
to talking about anything. Several Union committee members testified that they did not think the
parties were at impasse.
B. The Census Data
The Union witnesses testified that, at the June 7 meeting, Petro requested census data for the
pension plan, which includes names, seniority, and dates of birth of employees. According to Petro,
he received some requested pension information at the June 9 meeting, but that the envelope did not
include the census data. Petro stated that he did not tell Wright that the census data was missing
because Petro had not yet had a chance to review the documents.
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Nicoson testified that Petro did not ask for census data, but that Petro requested “5500 forms”
and any related pension information that was available. Wright also testified that Petro did not
specifically request census data and that Wright gave the requested pension information to Petro at
the June 10 meeting.
On June 18, 2004, Petro sent a letter to Nicoson regarding outstanding information requests,
including the census data. In a letter dated July 6, 2004, Wright told Petro that the Union had not
made any information requests prior to June 10, 2004. Finally, on September 29, 2004, Wright sent
Petro a letter and included a printout of the pension information. The letter stated: “Please note the
enclosed pension census information, which I missed copying back in June.”
C. The Complaint and the ALJ’s Decision
The Union filed a charge alleging that Newcor violated the Act by failing and refusing to
bargain in good faith in violation of §§ 8(5) and (1) of the Act. Specifically, the Union alleged that
Newcor violated the Act by: (1) failing to provide information to the Union that was relevant to
bargaining (the census data); and (2) implementing unilaterally Newcor’s final offer when the parties
were not at impasse. The Regional Director for Region 7 of the Board, on behalf of the General
Counsel, thereafter issued a complaint against Newcor for alleged violations of the Act.
The ALJ agreed with the General Counsel that Newcor had failed to provide the requested
census data in violation of the Act because an employer’s duty to bargain in good faith encompasses
the duty to provide information needed by the bargaining representative to assess claims made by
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the employer relevant to contract negotiations. The ALJ also held that Newcor violated the Act by
unilaterally implementing its final proposal without bargaining to impasse. First, the ALJ held that
the evidence showed that the Union was willing to continue negotiations when Newcor declared the
parties at an impasse and implemented Newcor’s final proposal. Alternatively, ALJ held that a valid
impasse was not reached because Newcor failed to provide the census information requested by the
Union and to which the Union was entitled.
The NLRB affirmed the ALJ’s rulings, findings, and conclusions, and adopted the ALJ’s
order. One member of the Board did not rely on the ALJ’s rationale that Newcor’s failure to
provide the census data prevented a valid impasse.
On March 3, 2006, the Board filed its application for enforcement of its order.
II. Analysis
A. Standard of Review
This court reviews the NLRB’s conclusions of law de novo. Pleasantview Nursing Home,
Inc. v. NLRB, 351 F.3d 747, 752 (6th Cir. 2003). The NLRB’s findings of fact must be upheld if
supported by substantial evidence on the record considered as a whole. W.F. Bolin Co. v. NLRB, 70
F.3d 863, 870 (6th Cir. 1995) (citing 29 U.S.C. §§ 160(e), (f) and Universal Camera Corp. v. NLRB,
340 U.S. 474 (1951)). “Evidence is considered substantial if it is adequate, in a reasonable mind,
to uphold the decision.” Turnbull Cone Banking Co. v. NLRB, 778 F.2d 292, 295 (6th Cir. 1985).
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The court must accept the Board’s credibility findings unless they have no rational basis. Fluor
Daniel, Inc. v. NLRB, 332 F.3d 961, 967 (6th Cir. 2003).
B. The Parties Did Not Reach a Valid Impasse
Substantial evidence supports the conclusions that the parties had not bargained to impasse
and that Newcor’s unilateral implementation of its final proposal was in violation of the Act. A valid
impasse exists when “the parties have exhausted the prospects of concluding an agreement and
further discussions would be fruitless.” Laborers Health & Welfare Trust Fund v. Advanced
Lightweight Concrete Co., 484 U.S. 539, 543 n.5 (1988). The burden of establishing impasse is on
the party asserting it. Grinnell Fire Prot. Sys. Co. v. NLRB, 236 F.3d 187, 196 (4th Cir. 2000) (citing
Tom Ryan Distributors, Inc., 314 N.L.R.B. 600, 604 (1994)). The Board’s conclusion regarding
impasse is entitled to deference. NLRB v. H & H Pretzel Co., 831 F.2d 650, 656 (6th Cir. 1987)
(“‘[I]n the whole complex of industrial relations few issues are less suited to appellate judicial
appraisal than evaluation of bargaining processes or better suited to the expert experience of a board
which deals constantly with such problems.’” (quoting Am. Federation of Television and Radio
Artists v. NLRB, 395 F.2d 622, 627 (D.C. Cir. 1968))).
In Taft Broadcasting Co., the NLRB listed a number of factors to be considered in
determining whether negotiating parties have reached impasse, including “bargaining history, the
good faith of the parties in negotiations, the length of the negotiations, the importance of the issue
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or issues as to which there is disagreement, [and] the contemporaneous understanding of the parties
as to the state of negotiations.” Taft Broadcasting Co., 163 N.L.R.B. 475, 478 (1967), aff’d sub
nom. Am. Federation of Television and Radio Artists v. NLRB, 395 F.2d 622 (D.C. Cir. 1968).
Substantial evidence supports the Board’s conclusion that no valid impasse existed. The ALJ
concluded that Newcor’s declaration of impasse was motivated by a June 10 deadline that Nicoson
repeatedly stated was in place. Although Nicoson attempted to explain the June 10 deadline by
asserting that customers would not want to do business with Newcor if they found out that Newcor
was operating without CBA, the ALJ noted that nothing in the record supported Nicoson’s
contention and that the decision to declare impasse assured the result that Newcor was attempting
to avoid—operating in the absence of a negotiated agreement. The conclusion is supported by the
record. Nicoson was adamant about the June 10 deadline despite the fact that the Union’s June 7
proposal reflected substantial movement on important issues, even if the movement was not to the
point that Newcor wanted. See, e.g., Dust-Tex Services, Inc., 214 N.L.R.B. 398, 405 (1974)
(“Matthey’s pronouncement . . . that the parties had reached an impasse was only a self-serving
statement artificially created and motivated by his desire to implement a change to the existing wage
structure immediately upon expiration of the contract.”). Moreover, even if Newcor did bargain in
good faith, the other factors support the ALJ’s conclusion that there was no impasse.
Although the there is no magic number in determining whether negotiations have continued
for a long enough period of time to support a finding of impasse, the length of negotiations is a
relevant consideration. The record supports the ALJ’s conclusion that the length of negotiations was
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not long enough to support a finding of impasse. First, the Union’s revised proposal was not made
until June 7, and Newcor declared an impasse on June 10. The Union’s revised proposal went a long
way toward meeting Newcor’s demands for cuts and concessions. Although the record indicates that
little headway was made at the June 9 meeting, the Union committee was still attempting to develop
a proposal on June 10 when Nicoson ended negotiations and declared the parties at impasse.
Newcor’s position appears to be that, because the parties had been through seven meetings and had
not come to an agreement, they had bargained long enough. However, Newcor was demanding
drastic cuts and concessions and Wright admitted that Newcor’s proposal was “ugly.” Even
assuming both parties would work diligently and in good faith, a potentially protracted negotiation
should have been expected. Rather than counting the number of meetings and thus determining that
the parties were at impasse, an examination of the conduct of the parties at those meetings is
appropriate. On the facts presented, that there had been seven bargaining sessions does not lead to
the conclusion that the parties had negotiated to impasse or that additional negotiations would have
been futile, especially since the Union was continuing its efforts to develop a proposal to meet
Newcor’s concerns.
Finally, the question of the contemporaneous understanding of the parties supports the
conclusion that the parties had not bargained to impasse. First, Ryan told Nicoson that the Union
was willing to continue negotiating and the Union committee members testified that they did not
consider the parties to be at impasse. This evidence supports the conclusion that the parties were not
at impasse because the Union was willing to continue negotiations. See, e.g., Teamsters Local Union
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No. 639 v. NLRB, 924 F.2d 1078, 1084 (D.C. Cir. 1991) (“These Union protestations manifest that
one party did not view the negotiations as having reached impasse.”); Saunders House v. NLRB, 719
F.2d 683, 688 (3d Cir. 1983) (impasse finding “often depends on the mental state of the parties”);
Huck Mfg. Co. v. NLRB, 693 F.2d 1176, 1186 (5th Cir. 1982) (conclusion that there was no impasse
was supported by the fact that the “Union’s chief negotiator testified that he never felt the parties
were at an impasse”). Although empty protestations will not preclude a finding of impasse, H & H
Pretzel, 831 F.2d at 656, the disagreement expressed by the committee members in response to
Nicoson’s statement that the parties were at impasse supports the conclusion that the Union was
willing to continue negotiating. Newcor argues that the information request made on June 10
contradicted the Union’s statements that it was willing to continue negotiating because, according
to the information request, it would be “difficult or even impossible for the union to put together a
comprehensive proposal until we begin to receive information requests in a timely manner.”
However, the fact that the Union was telling Newcor that negotiating without relevant information
was difficult does not negate the fact that the Union was willing to negotiate on other economic
issues, even if the pension issue could not be settled that very day. The Union committee members
expressly stated that they were willing to discuss anything. Newcor merely maintains that the parties
remained far apart when impasse was declared. Remaining far apart on important issues where one
party has expressed a willingness to bargain does not necessarily result in impasse. See NLRB v.
Webb Furniture Corp., 366 F.2d 314, 316 (4th Cir. 1966) (“When the union tendered some
concessions, the employer might reasonably be required to recognize that negotiating sessions might
produce other or more extended concessions.”).
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Overall, Newcor must establish that continued bargaining would have been futile. Colfor
Inc. v. NLRB, 838 F.2d 164, 167 (6th Cir. 1988). As the ALJ noted, the parties had successfully
narrowed the differences between them and were coming closer to an agreement when Nicoson
pulled the plug on further negotiations. The Union presented a proposal that agreed to a number of
concessions and significantly narrowed the differences between the parties’ positions. Virtually all
of the progress made during negotiations was a result of concessions from the Union. The
conclusion that no impasse existed is supported by substantial evidence. We thus have no need to
address the Board’s alternative holding that impasse was impossible in light of Newcor’s failure to
provide the census data.
B. Failure to Provide Census Information
Newcor has only briefly and in summary fashion addressed the Board’s determination that
Newcor’s failure to provide the requested census data was itself a violation of the Act. “[I]t is a
settled appellate rule that issues adverted to in a perfunctory manner, unaccompanied by some effort
at developed argumentation, are deemed waived.” United States v. Elder, 90 F.3d 1110, 1118 (6th
Cir. 1996) (citation and quotation marks omitted). Furthermore, “[a]n employer’s ‘failure to address
or take issue with the Board’s findings and conclusions with regard to . . . violations [of the Act]
effectively results in abandonment of the right to object to those determinations.’” NLRB v. Talsol
Corp., 155 F.3d 785, 793 (6th Cir. 1998) (quoting NLRB v. Ky. May Coal Co., Inc., 89 F.3d 1235,
1241 (6th Cir. 1996). In cases where the employer does not challenge the NLRB’s findings on
appeal, the court may “summarily enforce the Board’s order with regard to those issues.” Id. Thus,
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we grant enforcement of the Board’s order as it relates to Newcor’s failure to provide the census
data.
III. Conclusion
For the foregoing reasons, we grant enforcement of the Board’s order.
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