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Parties Involved:
National Labor Relations Board
Respondent
Titanium Metals Corporation
Petitioner

Document Text:

Notice: This opinion is subject to formal revision before publication in the

Federal Reporter or U.S.App.D.C. Reports. Users are requested to notify

the Clerk of any formal errors in order that corrections may be made

before the bound volumes go to press.

United States Court of Appeals

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued October 15, 2004 Decided November 30, 2004

No. 03-1345

TITANIUM METALS CORPORATION,

PETITIONER

v.

NATIONAL LABOR RELATIONS BOARD,

RESPONDENT

Consolidated with

03-1410

On Petition for Review and Cross-Application

for Enforcement of an Order of the

National Labor Relations Board

George E. Yund argued the cause and filed the briefs for

petitioner Titanium Metals Corporation.

 Bills of costs must be filed within 14 days after entry of judgment.

The court looks with disfavor upon motions to file bills of costs out

of time.

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Kira D. Vol, Attorney, argued the cause for respondent.

With her on the brief were Arthur F. Rosenfeld, General

Counsel, John H. Ferguson, Assistant General Counsel, Aileen A. Armstrong, Deputy Associate General Counsel, and

Robert J. Englehart, Attorney. David A. Fleischer, Senior

Attorney entered an appearance for respondent.

Before: EDWARDS and RANDOLPH, Circuit Judges, and

WILLIAMS, Senior Circuit Judge.

Opinion for the Court filed by Circuit Judge EDWARDS.

EDWARDS, Circuit Judge: In a decision issued on September 30, 2003, the National Labor Relations Board (‘‘Board’’ or

‘‘NLRB’’) held that Titanium Metals Corporation (‘‘TIMET’’)

violated § 8(a)(1) of the National Labor Relations Act

(‘‘NLRA’’ or ‘‘ACT’’), 29 U.S.C. § 158(a)(1) (2000), when the

company first issued a warning, then suspended, and finally

discharged employee David W. Smallwood in May 1999 for

poor work performance, failing to cooperate in a related

investigation, distributing a newsletter, and encouraging other employees at TIMET to call him during working hours.

The Board also found that TIMET violated § 8(a)(1) of the

Act by denying Smallwood’s request for union representation

during an interview regarding his discipline and by maintaining and enforcing an overly broad no-solicitation/nodistribution rule.

The Board’s decision on the disputed disciplinary actions

rests principally on its findings that Smallwood’s publication

and distribution of a newsletter constituted ‘‘protected concerted activity’’ under § 7 of the Act, 29 U.S.C. § 157; that

TIMET was motivated to discipline Smallwood because of his

publication and distribution of the newsletter in 1999; and

that Smallwood’s publications did not lose the protection of

the Act, because the cited articles did not disparage the

employer, advocate violence, recklessly disregard the truth,

or include material that was maliciously false.

In reaching this decision, the Board declined to defer to a

grievance settlement reached by TIMET and the United

Steelworkers of America, Local 4856, AFL-CIO (‘‘Union’’)

USCA Case #03-1345 Document #862613 Filed: 11/30/2004 Page 2 of 16
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under their collective bargaining agreement. The Union had

pursued a grievance to challenge the grounds of the disciplinary actions taken against Smallwood. Following deliberations

between TIMET and Union officials, the parties entered into

a Letter of Understanding in which they agreed that Smallwood was properly dismissed for ‘‘insubordination, inappropriate conduct toward the Company and supervisory employees, ongoing and costly workmanship related infractions,

[and] providing misleading and inaccurate information related

to melting incident investigations,’’ and that Smallwood ‘‘was

not discharged for engaging in protected activities under the

NLRA.’’ The Board specifically refused to accept a finding

by the Administrative Law Judge (‘‘ALJ’’) that the parties’

grievance settlement was ‘‘repugnant to the purposes and

policies of the Act.’’ The Board nonetheless declined to defer

to the parties’ grievance settlement, because, in the Board’s

view, the Letter of Understanding failed to satisfy the applicable standards of fairness and regularity. See Spielberg

Mfg. Co., 112 N.L.R.B. 1080, 1082 (1955); Alpha Beta Co., 273

N.L.R.B. 1546, 1547 (1985), petition for review denied sub

nom. Mahon v. NLRB, 808 F.2d 1342 (9th Cir. 1987).

TIMET petitions for review of the Board’s decision and the

NLRB cross-applies for enforcement of its order. TIMET

does not challenge the Board’s findings that it violated

§ 8(a)(1) by questioning Smallwood in the absence of a Union

representative and by maintaining and enforcing an overly

broad no-solicitation/no-distribution rule. Instead, TIMET

contends that the Board misapplied established law in refusing to defer to a settlement reached by TIMET officials and

Smallwood’s union representatives, where the settlement was

reached pursuant to the parties’ lawful grievance procedures,

Smallwood had no right under the agreement to approve a

grievance settlement, the Board declined to endorse the

ALJ’s finding that the parties’ settlement was ‘‘palpably

wrong’’ or otherwise ‘‘clearly repugnant’’ to the purposes and

policies of the Act, and there is no claim that the Union

breached its duty of fair representation. We hold that, under

these circumstances, the Board clearly erred in declining to

defer to the settlement agreement between TIMET and the

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Union. In light of this holding, the Board’s holding that

TIMET violated § 8(a)(1) in disciplining Smallwood is vacated

and TIMET’s challenge to that holding is dismissed as moot.

I. BACKGROUND

TIMET, a Delaware corporation, is engaged in the fabrication of titanium metal ingots at its Henderson, Nevada facility. At all times relevant to this case, TIMET and the Union

were parties to a collective bargaining agreement that covered production and maintenance employees. See Titanium

Metals Corp., 340 N.L.R.B. No. 88 (Sept. 30, 2003), slip op. at

1, 4, reprinted in Joint Appendix (‘‘J.A.’’) 355, 355, 358,

available at 2003 WL 22295370. The collective bargaining

agreement provided for a four-step grievance-arbitration procedure. At step one, an aggrieved employee, or Union representatives acting on the employee’s behalf, could discuss the

matter with the employee’s foreman or supervisor. If a

grievance was ‘‘not adjusted to the satisfaction of the Union

in Step 1,’’ the Union had the option of presenting the

grievance in writing to the Human Resources Manager and

attempting to resolve it with the department manager at the

second step of the grievance procedure. Collective Bargaining

Agreement Between Titanium Metals Corporation and United

Steelworkers of America (1996), ¶ 11:19, J.A. 237. If a grievance remained unresolved, the Union had the option of proceeding to step three, which involved a written appeal to the

Human Resources Manager. Under the agreement, a ‘‘representative of the Union shall have the authority to settle or

withdraw any Union grievance in Step 3.’’ Id. ¶ 11:20, J.A.

238. Finally, if a grievance was unresolved after step three,

the Union could appeal the matter to arbitration. Id. ¶ 11:22,

J.A. 238. The agreement did not require the Union to

consult with, or obtain approval from, an aggrieved employee

before settling a grievance or deciding whether to appeal a

matter to arbitration.

Smallwood began working for TIMET in July 1994. Beginning in October 1996, Smallwood was employed as a furnace

operator in the melt department. Titanium Metals, slip op.

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at 4, J.A. 358. From May 1997 through November 1997, and

again in late March and May 1999, Smallwood published a

newsletter, which he distributed to approximately 20 of TIMET’s melt department employees at their homes and to the

Union at its office. The newsletter was widely read and

circulated in the melt department. Id. The Board found

that ‘‘[t]he newsletter was usually about six pages long and

contained articles of general interest as well as those dealing

with wages, hours, and working conditions at the Henderson

facility, many of which were critical of supervisors and [TIMET’s] labor-management policies.’’ Id.

On December 22, 1997, TIMET issued a written warning to

Smallwood for violating the company’s harassment-free workplace policy based on his written and verbal comments. In

response to the warning, Smallwood stopped disseminating

the newsletter until late March 1999, when he published a

new edition. Smallwood received another written warning on

May 25, 1999. The May 25 warning stated that Smallwood

was being disciplined for: (1) poor work performance, including a May 18, 1999 incident in which he allegedly damaged an

ingot, (2) the manner in which he responded to the investigation of that incident, (3) distributing the newsletter, and (4)

encouraging fellow employees to call him during work hours.

See id., slip op. at 5-6, J.A. 359-60.

Smallwood published the final edition of the newsletter at

about the same time when he received the May 25 warning.

On May 26, employee relations supervisor Alan Gines and

another supervisor, Max Frederick, met Smallwood when he

arrived at work and brought him to the office of melt division

supervisor Vinoo Kamdar. There, Gines informed Smallwood

that he was suspended pending termination. By letter dated

June 8, 1999, TIMET converted Smallwood’s suspension to a

discharge effective May 26, 1999. Id., slip op. at 6-7, J.A.

360-61.

Pursuant to the procedures in the collective bargaining

agreement between TIMET and the Union, Smallwood’s discharge was the subject of a grievance that reached step three

on July 22, 1999. Id., slip op. at 7, J.A. 361. Following their

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deliberations over Smallwood’s grievance, TIMET and the

Union finally resolved the matter in a ‘‘Letter of Understanding’’ dated February 15, 2000. The grievance settlement

provided, as follows:

Mr. Smallwood was not discharged for engaging

in protected concerted activities under the NLRA.

The Company recognizes the Union’s rights to communicate with represented employees, to post notices and other related Union materials on plant

bulletin boards as outlined in the collective bargaining agreement, and to engage in all other legally

protected rights and activities, including, but not

necessarily limited to, the NLRATTTT The Company’s reasons for discharging Mr. Smallwood included issues such as insubordination, inappropriate

conduct toward the Company and supervisory employees, ongoing and costly workmanship related infractions, providing misleading and inaccurate information related to melting incident investigations,

etc.

Letter of Understanding of 2/15/00, J.A. 349. On March 8,

2000, the Union sent Smallwood a letter advising him that a

‘‘decision has been made that no further action will be taken,

pertaining to the grievance, filed on your behalf regarding

your discharge from employment at Titanium Metals Corporation.’’ Letter from Jerry Storms to David Smallwood of

3/8/00, J.A. 350. Although Smallwood did not have a copy of

the parties’ settlement agreement, he knew then that his

grievance would not be appealed to arbitration.

While the Union was pursuing Smallwood’s grievance,

Smallwood filed an unfair labor practice charge against TIMET with the NLRB on July 2, 1999. He amended his

charge on August 9, 2000. The Board’s Regional Director

issued a complaint on August 24, 2000. Titanium Metals,

slip op. at 4, J.A. 358. Neither Smallwood’s charge nor the

Board’s complaint claimed that the Union’s representation of

Smallwood during the grievance processing was in any way

suspect or inadequate. Amended Charge, 8/9/00, J.A. 192-93;

Complaint and Notice of Hearing, 8/24/00, J.A. 195-200.

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After trying the case in Las Vegas, Nevada from January

16-19, 2001, the ALJ issued a decision on March 30, 2001.

The ALJ determined that Smallwood’s publication of the

newsletter in 1999 constituted protected concerted activity

under § 7 of the NLRA. The ALJ also concluded that

nothing in the subject matter of the newsletters caused them

to lose their protection under § 7, because the articles did not

disparage TIMET, advocate violence, or involve false statements made maliciously or with reckless disregard for the

truth. Because the ALJ found that TIMET was motivated to

discipline Smallwood because of his publication of a newsletter in 1999, the ALJ held that TIMET committed unfair labor

practices in violation of NLRA § 8(a)(1) by interfering with

Smallwood’s exercise of his § 7 rights. See Titanium Metals,

slip op. at 7-9, J.A. 361-63. The ALJ further ruled that

TIMET violated § 8(a)(1) by questioning Smallwood during

the May 26 discharge meeting in the absence of a Union

representative after Smallwood had requested representation,

and by having promulgated and enforced an overly broad nodistribution/no-solicitation rule. Id., slip op. at 9-10, J.A. 363-

64.

In concluding that TIMET’s discipline of Smallwood violated § 8(a)(1), the ALJ declined to defer to the Letter of

Understanding between TIMET and the Union settling

Smallwood’s grievance. The ALJ purported to rely on Alpha

Beta Co., 273 N.L.R.B. 1546 (1985), petition for review denied

sub nom. Mahon v. NLRB, 808 F.2d 1342 (9th Cir. 1987), in

which the Board extended the deferral principles of Spielberg

Mfg. Co., 112 N.L.R.B. 1080 (1955), to grievance settlements.

Alpha Beta, 273 N.L.R.B. at 1547. As noted by the Board in

this case, under Spielberg and Alpha Beta, the Board will

defer to a grievance settlement when: (1) the grievance

proceedings were fair and regular, (2) all parties agreed to be

bound, and (3) the results of the settlement are not clearly

repugnant to the purposes and policies of the NLRA. See

Titanium Metals, slip op. at 2, J.A. 356 (citing Spielberg, 112

N.L.R.B. at 1082; Alpha Beta, 273 N.L.R.B. at 1546). The

ALJ found that, because Smallwood was dismissed for engaging in protected concerted activity, the Letter of UnderstandUSCA Case #03-1345 Document #862613 Filed: 11/30/2004 Page 7 of 16
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ing was ‘‘palpably wrong’’ and, therefore, the settlement was

‘‘repugnant to the principles and policies of the Act.’’ Id., slip

op. at 10, J.A. 364.

The Board affirmed the ALJ’s findings of § 8(a)(1) violations and also agreed with the ALJ that deferral to the Letter

of Understanding between TIMET and the Union was inappropriate. See id., slip op. at 1, J.A. 355. The Board

assumed that the Letter of Understanding was a settlement

agreement to which it might defer under Alpha Beta. However, the Board refused to endorse the ALJ’s finding that the

settlement agreement was clearly repugnant to the purposes

and policies of the Act. Rather, the Board held that ‘‘the

process that resulted in the ‘Letter of Understanding’ was not

fair and regular and, accordingly, failed to satisfy the standard for deferral.’’ Id., slip op. at 2, J.A. 356.

The Board cited two considerations in reaching its conclusion that the settlement agreement was not fair and regular.

First, the Board noted that the existence of the Letter of

Understanding was not promptly disclosed to Smallwood.

Second, the Board stated that the reasons cited in the Letter

of Understanding in support of Smallwood’s discharge deviated from those given Smallwood when he was terminated.

According to the Board, ‘‘[i]n the absence of any explanation

from [TIMET] or the Union for this deviation, the ‘Letter of

Understanding’ appears to be an attempt to disguise the real

reason for the discharge: Smallwood’s protected, concerted

activity of distributing a newsletter that addressed employment conditions and employment-related matters.’’ Titanium Metals, slip op. at 2, J.A. 356. The Board did not find

that the substantive terms of the settlement were unlawful;

nor did it find that the Union breached its duty of fair

representation to Smallwood.

TIMET filed the present petition for review of the Board’s

decision, and the Board cross-applied for enforcement of its

order. TIMET does not challenge the Board’s findings that

TIMET violated § 8(a)(1) by questioning Smallwood in the

absence of a union representative during the May 26 interview with Gines and by maintaining an overly broad nosolicitation/no-distribution rule. Therefore, the Board is entiUSCA Case #03-1345 Document #862613 Filed: 11/30/2004 Page 8 of 16
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tled to summary enforcement of these findings. See Int’l

Union of Petroleum & Indus. Workers v. NLRB, 980 F.2d

774, 778 n.1 (D.C. Cir. 1992).

II. ANALYSIS

A. Standard of Review

Judicial review of NLRB determinations in unfair labor

practice cases is generally limited, but not so deferential that

the court will merely act as a rubber stamp for the Board’s

conclusions. Pa. State Educ. Ass’n-NEA v. NLRB, 79 F.3d

139, 148 (D.C. Cir. 1996). Board orders will not survive

review when the Board’s decision has no reasonable basis in

law or when the Board has failed to apply the proper legal

standard. See, e.g., NLRB v. McClatchy Newspapers, Inc.,

964 F.2d 1153, 1156 (D.C. Cir. 1992) (Edwards, J., concurring). A Board’s decision will also be set aside when it

departs from established precedent without reasoned justification, see, e.g., Pittsburgh Press Co. v. NLRB, 977 F.2d 652,

655 (D.C. Cir. 1992), or when the Board’s factual determinations are not supported by substantial evidence, see Allentown Mack Sales & Serv., Inc. v. NLRB, 522 U.S. 359, 366

(1998). Finally, if the Board fails to follow or misapplies its

own standards in deciding whether to defer to a grievance

settlement, the Board’s decision will be set aside as an abuse

of discretion. See Plumbers & Pipefitters Local 520 v.

NLRB, 955 F.2d 744, 750 (D.C. Cir.) (setting forth abuse of

discretion standard of review), cert. denied, 506 U.S. 817

(1992). See also Am. Freight Sys., Inc. v. NLRB, 722 F.2d

828, 832 (D.C. Cir. 1983) (‘‘Although the Board has considerable discretion in deciding whether to defer TTT a failure to

follow its own standards of deference is an abuse of that

discretion.’’).

B. The Board’s Deferral Policy and Its Application to

this Case

1. The Parties’ Letter of Understanding was a Settlement

Agreement Subject to Alpha Beta

This case requires us to examine whether the Board abused

its discretion in declining to defer to the Letter of UnderUSCA Case #03-1345 Document #862613 Filed: 11/30/2004 Page 9 of 16
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standing between TIMET and the Union. Before reaching

this question, however, we must first address whether the

Letter of Understanding constituted a settlement agreement

subject to analysis under Alpha Beta. The Board merely

assumed this without deciding the matter. This is of no

moment, however, because we accord no deference to the

Board’s interpretations of labor contracts. BP Amoco Corp.

v. NLRB, 217 F.3d 869, 873 (D.C. Cir. 2000).

We have reviewed the Letter of Understanding and conclude that it is a valid settlement agreement. Therefore

Alpha Beta applies. The Board refused with good reason to

adopt the ALJ’s finding that the settlement agreement was

repugnant to the Act, for there is nothing legally impermissible in the terms of the agreement. The record is also clear

that the agreement was properly executed by TIMET and

Union officials pursuant to the terms of their lawful collective

bargaining agreement. And both parties received consideration under the settlement agreement: TIMET secured disciplinary action against Smallwood and, as Board counsel conceded, ‘‘[t]he Union got a reaffirmation of its rights.’’ Br. for

NLRB at 39. Therefore, we conclude that the Letter of

Understanding constitutes a settlement agreement between

TIMET and the Union to which the Board must apply the

deferral standards of Alpha Beta.

2. The Alpha Beta Deferral Policy

As noted above, the Board declared in Alpha Beta that it

will defer to grievance settlements when: (1) the proceedings

appear to have been fair and regular; (2) all parties agree to

be bound; and (3) the agreement is not palpably wrong –

meaning it is not clearly repugnant to the purposes and

policies of the NLRA. See Alpha Beta, 273 N.L.R.B. at 1547.

The Board noted a fourth consideration in United States

Postal Serv., 300 N.L.R.B. 196, 198 (1990), namely, whether

the parties to a grievance settlement considered the unfair

labor practice issue in reaching their agreement. This fourth

consideration is not at issue here, as there is no dispute that

the parties’ Letter of Understanding meets this prong of the

Board’s deferral test.

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The Alpha Beta deferral policy was upheld by this court in

Plumbers, 955 F.2d at 751-52. The Plumbers decision noted

that,

[b]y recognizing the validity and finality of [prearbitration grievance] settlements, the Board promotes the integrity of the collective bargaining process, thereby effectuating a primary goal of the

national labor policy.

Id. at 752. Fostering the integrity of the collective bargaining process clearly advances the purposes of the NLRA, and

the Labor Management Relations Act, 29 U.S.C. §§ 141-144,

171-187 (2000), because these laws ‘‘are designed to protect

both individual and collective rights, and have as their paramount goal the promotion of labor peace through the collective efforts of labor and management.’’ Hammontree v.

NLRB, 925 F.2d 1486, 1502 (D.C. Cir. 1991) (en banc) (Edwards, J., concurring).

In short, the Board’s policy of deferring to grievance

settlements is supported by two simple and related policy

determinations: First, ‘‘[t]he Board found that the application

of deferral principles to such settlements would further the

policy favoring private resolution of labor disputes.’’ Postal

Serv., 300 N.L.R.B. at 197. Second, when contract grievance

disputes implicate statutory rights that are ‘‘waiveable’’ pursuant to collective bargaining, it is appropriate to accede to

arrangements reached by the bargaining parties. See Metro.

Edison Co. v. NLRB, 460 U.S. 693, 705 (1983) (‘‘This Court

long has recognized that a union may waive a member’s

statutorily protected rightsTTTT’’); id. at 707 n.11 (‘‘the National Labor Relations Act contemplates that individual rights

may be waived by the union so long as the union does not

breach its duty of good-faith representation’’); Energy Coop.,

Inc., 290 N.L.R.B. 635, 636 (1988) (relying on Metropolitan

Edison for the proposition that a union may waive a member’s statutorily protected rights).

There is no doubt that employee discipline of the sort

implicated in this case falls within the compass of waiveable

rights that are subject to collective bargaining and grievance

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settlements. See Fournelle v. NLRB, 670 F.2d 331, 335 (D.C.

Cir. 1982) (‘‘An employee’s section 7 rights to engage in

concerted activities TTT are neither unqualified nor absoluteTTTT [C]ertain rights granted by section 7 may be

waived pursuant to collective bargaining.’’); Postal Serv., 300

N.L.R.B. at 197 (in cases involving employee discipline, ‘‘a

union can waive employees’ statutory rights’’ and employees

are bound by the terms of settlement agreements negotiated

by their bargaining representative). The Board does not

suggest otherwise. Therefore, the only issue here is whether

the Board abused its discretion in declining to defer in this

case, where the disputed settlement was reached pursuant to

the parties’ lawful grievance procedures, Smallwood had no

right under the agreement to approve a grievance settlement,

the Board specifically refused to endorse the ALJ’s finding

that the parties’ settlement was ‘‘palpably wrong’’ or otherwise ‘‘clearly repugnant’’ to the purposes and policies of the

Act, and there is no claim that the Union breached its duty of

representation. For the reasons indicated below, we hold

that, in these circumstances, the Board clearly erred in

declining to defer to the settlement agreement between TIMET and the Union.

3. Application of the Board’s Deferral Policy in this Case

As noted above, the Board rested its decision solely on the

‘‘fair and regular’’ prong of Alpha Beta. The Board offered

two reasons to justify its conclusion that the settlement

agreement between TIMET and the Union was not fair and

regular. First, the Board noted that ‘‘the existence of the

[settlement] agreement was never disclosed to [Smallwood]

by the Union or the [employer].’’ Titanium Metals, slip op.

at 2, J.A. 356. Second, the Board found that, ‘‘although the

‘Letter of Understanding’ recites several reasons for Smallwood’s discharge – including ‘insubordination, inappropriate

conduct toward the company TTT [and] providing misleading

and inaccurate information TTT’ – these reasons were not the

explanation given to Smallwood when he was discharged.’’

Id. Neither explanation justifies the Board’s conclusion that

the parties’ settlement agreement failed the ‘‘fair and regular’’ prong of Spielberg and Alpha Beta.

USCA Case #03-1345 Document #862613 Filed: 11/30/2004 Page 12 of 16
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The Board first stresses that the Letter of Understanding

was never disclosed to Smallwood. This is perplexing, for, in

the context of this case, this fact is utterly innocuous. Smallwood knew he had been terminated; he knew that the Union

did not settle the grievance on terms that were favorable to

him; and he knew that the Union did not appeal the case to

arbitration. In other words, he was clearly on notice of the

fact that TIMET and the Union had resolved his grievance

without providing him any of the remedies he had requested.

He was free to ask his Union agent about the terms upon

which his grievance was settled, but he did not do this. And

the Board does not suggest that the Union withheld any

materials related to Smallwood’s grievance to which he was

entitled under the collective bargaining agreement.

More importantly, it is legally irrelevant that Smallwood

was not notified that the Union and TIMET had executed a

Letter of Understanding with regard to his claims. Absent

specified rights under a collective bargaining agreement, bargaining unit employees have no right to participate in contract grievance proceedings. See Plumbers, 955 F.2d at 753-

54. Indeed, recognizing that a union is the collectivebargaining agent of individual employees, the Board has

made it clear that it will defer to grievance settlements even

when a grievant objects to the settlement. See Postal Serv.,

300 N.L.R.B. at 197. The Board acknowledges that a union

can settle an employee’s grievance over his objection, but

argues that this case should be treated differently, because

Smallwood was not informed of the precise terms of the

settlement agreement between the Union and TIMET. Titanium Metals, slip op. at 2, J.A. 356; Br. for NLRB at 37-38.

This is a specious argument. Even if Smallwood had been

notified of the precise details of the settlement, he could have

done nothing to change it. The employer and union are the

parties to the collective bargaining agreement and only they –

not individual employees – determine how to interpret and

enforce the agreement. In short, as we stated in Plumbers:

‘‘Absent a breach of the duty of fair representation, the [union

is] empowered to bind [the individual employee] to the result

obtained through the grievance process.’’ 955 F.2d at 753.

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The second factor the Board relied on in declining to defer

in this case was that the reasons recited in the Letter of

Understanding for Smallwood’s discharge differed from the

explanation given Smallwood when he was discharged. Assuming this is true, it does not support the Board’s conclusion

that the settlement agreement was not fair and regular. The

Union and TIMET were well within their rights to negotiate

over Smallwood’s grievance under the contract grievance

procedures and decide whether, and on what terms, Smallwood should be terminated. See Collective Bargaining

Agreement, ¶¶ 11:19, 11:20, J.A. 237-38. Indeed, Board counsel acknowledged at oral argument that, if an arbitrator had

upheld the termination of Smallwood for the same reasons

relied upon in the Letter of Understanding, the Board probably would not have concluded that the arbitration process was

unfair or irregular. Recording of Oral Argument at 21:20-:45.

There is nothing in the record to suggest that the grounds

recited in the Letter of Understanding supporting Smallwood’s discharge – i.e., insubordination, inappropriate conduct, workmanship related infractions, and making misleading

statements during the investigation of workplace accidents –

were factually unsupportable. See, e.g., Tr. of ALJ Hearing

at 589-90, J.A. 184-85 (testimony that Smallwood was responsible for a workplace overmelt and that Smallwood lied about

what happened). And, as noted above, the Board does not

assert that the Union breached its duty of fair representation

to Smallwood in reaching the settlement. Therefore, the fact

that the explanation for Smallwood’s termination in the Letter of Understanding differed from the reasons given Smallwood when he was discharged did not make the settlement

agreement unfair or irregular. The Letter or Understanding

was the lawful product of collective bargaining between company and union representatives.

At oral argument before the court, in an effort to defend

the Board’s decision, Board counsel suggested that this case

‘‘didn’t smell right.’’ Recording of Oral Argument at 28:36.

But when counsel was pressed to explain what smelled bad

about the case, she could identify nothing that provides a

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legal justification for the Board’s refusal to defer to the

settlement agreement. As we noted in Plumbers, ‘‘since a

union has broad discretion to alter or modify employees’

‘waiveable’ rights through collective bargaining, see Metropolitan Edison Co., 460 U.S. at 705-07, 103 S.Ct. at 1475-77, we

see no basis upon which the Board legitimately could intervene merely because the settlement reached by the union and

the employer was not to the Board’s liking.’’ Plumbers, 955

F.2d at 757.

What is clear here is that Board does not have discretion to

abandon its established deferral policies and act on whim. As

we said in American Freight,

[a]llowing the Board to disregard its own deference

policy, which has been reinforced by long-standing

and consistent case precedent, would undermine the

careful development of the Spielberg standards of

deference, discourage parties from relying on their

own bargaining agreements and procedures, and

‘‘significantly undermin[e] the value and efficacy of

arbitration as an alternative to the judicial or administrative resolution of labor disputes.’’

Am. Freight, 722 F.2d at 833 (quoting Liquor Salesmen’s

Union Local 2 v. NLRB, 664 F.2d 318, 327 (2d Cir. 1981)

(alteration in Am. Freight)). The same analysis holds true

here.

There is no basis under established law justifying the

Board’s conclusion that the disputed Letter of Understanding

violated the first prong of the Spielberg/Alpha Beta deferral

doctrine. What is ‘‘fair and regular’’ under the first prong of

Alpha Beta must be measured by reference to the parties’

collective bargaining agreement, not by reference to the

Board’s abstract sense of what is right. It is clear in this

case that the parties acted pursuant to a lawful grievance

procedure and faithfully adhered to the terms of their collective bargaining agreement in processing Smallwood’s grievance; the resulting settlement agreement was not repugnant

to the Act; and the Union did not violate its duty of fair

representation. It defies reason to hold that a grievance

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settlement reached in these circumstances is unfair or irregular. The Board’s contrary conclusion was an abuse of discretion.

III. CONCLUSION

TIMET’s petition for review of the Board’s order is granted in part and denied in part. The Board’s cross-application

for enforcement of its order is granted in part and denied in

part. For the reasons stated above: (1) the Board’s order is

enforced insofar as it finds that TIMET violated § 8(a)(1) by

questioning Smallwood in the absence of a Union representative and by maintaining and enforcing an overly broad nosolicitation/no-distribution rule; (2) TIMET’s petition challenging the Board’s decision declining to defer to the Letter

of Understanding between TIMET and the Union is hereby

granted; and (3) the Board’s holding that TIMET violated

§ 8(a)(1) in disciplining Smallwood is vacated, TIMET’s challenge to that holding is dismissed as moot, and the Board’s

cross-application for enforcement of the order relating to

these § 8(a)(1) charges is denied.

So ordered.

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