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Parties Involved:
National Labor Relations Board
Petitioner
Tribune Publishing Company
Respondent

Document Text:

United States Court of Appeals

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued November 18, 2008 Decided April 28, 2009

No. 07-1455

TRIBUNE PUBLISHING COMPANY,

PETITIONER

v.

NATIONAL LABOR RELATIONS BOARD,

RESPONDENT

Consolidated with 07-1506

On Petition for Review and Cross-Application for

Enforcement of an Order 

of the National Labor Relations Board

L. Michael Zinser argued the cause and filed the briefs for

petitioner.

Gregory P. Lauro, Attorney, National Labor Relations

Board, argued the cause for respondent. With him on the brief

were Ronald E. Meisburg, General Counsel, John H. Ferguson,

Associate General Counsel, Linda Dreeben, Deputy Associate

General Counsel, and Julie B. Broido, Supervisory Attorney.

Jewel L. Fox, Attorney, entered an appearance.

USCA Case #07-1506 Document #1177901 Filed: 04/28/2009 Page 1 of 10
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Before: SENTELLE, Chief Judge, and GRIFFITH, Circuit

Judge, and RANDOLPH, Senior Circuit Judge.

Opinion for the Court filed by Chief Judge SENTELLE.

SENTELLE, Chief Judge: Tribune Publishing Company

petitions for review of the National Labor Relations Board’s

decision determining that the Company violated the National

Labor Relations Act, 29 U.S.C. §§ 151-169 (2008), by

unilaterally discontinuing the use of the Company’s direct

deposit system to collect union dues. Because the National

Labor Relations Board’s decision is supported by substantial

evidence and is consistent with the law, we deny the petition and

grant the National Labor Relations Board’s cross-application to

enforce its order.

Background

No factual issues appear to be in dispute. Petitioner Tribune

Publishing Company (“Tribune” or “Company”) publishes a

daily newspaper in Columbia, Missouri. Certain press room

employees, including operators of the printing presses, are

represented by the Graphic Communications International Union

(“Union”). In 1997 the Company and the Union entered into a

collective bargaining agreement (“CBA”), which included a

provision for payroll deduction of union dues upon written

request of the employee. (Commonly referred to as “dues

checkoff.”) Approximately 37 employees used this procedure

to have their union dues deducted from their paychecks. The

CBA expired on November 30, 2001. The Company

nevertheless continued dues checkoff until December 19, 2001,

at which time it sent each employee a letter stating that the

Company was exercising its legal right to discontinue payroll

deduction of union dues because the CBA had expired.

Thereafter, the Union’s secretary-treasurer apparently began

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collecting union dues from each individual employee.

During this time period, Company policy provided for the

direct deposit of an employee’s paycheck into a bank account;

direct deposit also allowed the employee to pay loans and

deposit to other accounts such as savings. With this direct

deposit provision in mind, after expiration of the contract and

while the parties were bargaining for a new contract, the Union

secretary-treasurer obtained a direct deposit authorization form,

reproduced it 37 times, filled in some of the information on the

forms and had each employee complete his or her form. He then

took the forms to Tribune’s administrative manager, Mary

Twenter, who had previously been on the negotiating committee

for the expired contract and had oversight responsibility for the

Company’s labor relations and human resources. Twenter told

the Union secretary-treasurer that it was “a good idea” to use

direct deposit for the payment of union dues and, accepted the

direct deposit forms for processing. After a trial run in April,

2002, the Company effectuated the direct deposit of union dues

on May 10, 2002, and provided to the Union an itemized list

containing the names of the depositing employees and the

amount of their dues payments. On May 24, 2002, however,

after only a one-time use of direct deposit for payment of union

dues, administrative manager Twenter sent a letter to each

employee stating that direct deposit of union dues was being

discontinued because dues checkoff had “been previously

discontinued by the Company and the direct deposit transactions

reinstated dues checkoff. Establishing direct deposit for dues

was a mistake.”

On May 30, 2002, the Union filed with the National Labor

Relations Board (“NLRB” or “Board”) an unfair labor practice

charge against the Company. The NLRB investigated the

charge and issued a complaint against the Company alleging,

inter alia, that the Company violated Sections 8(a)(5) and (1) of

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*

The ALJ also found that the unilateral termination by the

Company of direct deposit of union dues violated Section 8(a)(3) of

the Act, but the Board stated that it did not consider this finding as it

would not materially affect the remedy.

the National Labor Relations Act (the “Act”) by unilaterally

discontinuing the direct deposit of union dues. A hearing was

held before an NLRB administrative law judge (“ALJ”), who

determined that direct deposit of payroll deductions constitute

working conditions of the Union employees and are therefore

mandatory subjects of collective bargaining under the Act. He

also determined that the direct deposit of union dues was a

separate procedure unrelated to the CBA. The ALJ

consequently found that the Company violated Sections 8(a)(5)

and (1) of the Act* when it changed the working conditions of its

employees by ceasing to allow direct deposit of union dues

without affording the Union an opportunity to bargain about that

conduct.

The Company filed exceptions to the ALJ’s decision, and

the matter was assigned to a three-member panel of the NLRB.

In adopting the ALJ’s conclusion that the Company violated

Sections 8(a)(5) and (1) of the Act, the NLRB panel noted that,

after expiration of the contract and unilateral cessation of the

direct deposit of union dues by the Company, the Union

secretary-treasurer met with Company administrative manager

Twenter, and that during the meeting Twenter agreed with the

Union secretary-treasurer to allow use of the direct deposit

system for the payment of union dues. The panel also noted that

the Company had implemented direct deposit of union dues for

a full pay period. In light of these circumstances, the panel

determined that the deduction and direct deposit of union dues

became a new term and condition of employment. Since direct

deposit of payroll deductions is a mandatory subject of

bargaining, the panel stated, the Company was required to

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bargain with the Union before it could terminate the deductions.

Because it failed to bargain, the panel concluded that the

Company violated Sections 8(a)(5) and (1) of the Act.

The Company now files with this court a petition for

review, seeking reversal of the panel’s conclusion and dismissal

of the charges against it.

Discussion

“We enforce a Board order if the factual findings upon

which it rests are supported by ‘substantial evidence,’ see United

States Testing Co. v. NLRB, 160 F.3d 14, 19 (D.C. Cir. 1998),

and the Board’s interpretation of the Act is reasonable and

consistent with applicable precedent, see Local 702, Int’l Bhd.

of Elec. Workers, AFL-CIO v. NLRB, 215 F.3d 11, 15 (D.C. Cir.

2000).” Fashion Valley Mall, LLC. v. NLRB, 451 F.3d 241, 243

(D.C. Cir. 2006).

Tribune argues that it was error for the NLRB panel to find

that Tribune and the Union entered into a new agreement when

the Company agreed to deduct union dues by way of direct

deposit. Rather, Tribune contends, when it allowed its

employees to directly deposit their union dues after expiration

of the union contract, it was reinstituting the dues checkoff

provision in that expired union contract. The Company, noting

that the expired union contract provided for the withholding of

union dues from employee paychecks, contends that this was in

fact what direct deposit of union dues accomplished.

Consequently, argues Tribune, dues checkoff and direct deposit

of union dues are one and the same and the Company is

privileged to discontinue either in the context of an expired

union contract. Putting it another way, the Company asserts

that, because it had the right to discontinue payroll deduction of

union dues upon expiration of the union contract, when it

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stopped direct deposit of union dues it “[o]nce again . . .

exercised its right, in the context of an expired Collective

Bargaining Agreement, to cease deducting money from the

wages of employees in payment of membership dues to the

union.” Even if an oral agreement was reached, argues Tribune,

if an employer can cease payroll deduction of union dues upon

expiration of a union contract which contained an express

provision for union dues deduction, “then surely the employer

has the same right to cease payroll deduction of union dues

pursuant [to] an informal oral agreement reached during a

contract hiatus.”

The NLRB responds by first noting that pursuant to §§

8(a)(5) and (d) of the Act, it is an unfair labor practice for an

employer “to refuse to bargain collectively with the

representatives of his employees” with respect to “wages, hours,

and other terms and conditions of employment.” The NLRB

asserts that this provision bars an employer from unilaterally

discontinuing terms and conditions of employment that concern

a mandatory subject of bargaining. Here, argues the NLRB,

there is no serious dispute that direct deposit of union dues is a

mandatory subject of bargaining. The NLRB consequently

contends that when the Company agreed to directly deposit

union dues, this was a new agreement concerning terms and

conditions of employment that could not be unilaterally

terminated by the Company. The NLRB argues that, therefore,

the panel reasonably found that Tribune had violated §§ 8(a)(5)

and (d) by unilaterally terminating the new agreement made

with the Union. Although Tribune’s arguments focus on the

dues checkoff clause of the expired union contract, the NLRB

contends, that contract is not relevant here because this case

turns on whether Tribune reached a new agreement to use direct

deposit to remit union dues.

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Pursuant to the NLRA, employees have the right “to bargain

collectively through representatives of their own choosing.” 29

U.S.C. § 157. Furthermore, it is an unfair labor practice for an

employer “to interfere with, restrain, or coerce employees in the

exercise of the rights guaranteed in [§ 157],” and “to refuse to

bargain collectively with the representatives of his employees.”

29 U.S.C. §§ 158(a)(1) and (5). The obligation to bargain

collectively is defined as the meeting of the employer and

representative of the employees to “confer in good faith with

respect to wages, hours, and other terms and conditions of

employment.” 29 U.S.C. § 158(d). Pursuant to Board and court

decisions, dues checkoff is a matter related to “wages, hours,

and other terms and conditions of employment” within the

meaning of the Act and is therefore a mandatory subject for

collective bargaining. See Quality House of Graphics, Inc., 336

N.L.R.B. 497, 511 & n.42 (2001) (citing various cases); see also

Sw. Steel & Supply v. NLRB, 806 F.2d 1111, 1114 (D.C. Cir.

1986). 

Under Board precedent, the expiration of a collective

bargaining agreement that created payroll deduction of union

dues results in the expiration of the employer’s obligation to

continue that deduction. See Bethlehem Steel Co., 136 N.L.R.B.

1500, 1502 (1962). But after expiration of the agreement a

company may, if it wishes, continue payroll deduction of union

dues until such time it elects to cease making that deduction.

See Lowell Corrugated Container Corp., 177 N.L.R.B. 169, 173

(1969), enf’d on other grounds, 431 F.2d 1196 (1st Cir. 1970);

cf. Redway Carriers, 274 N.L.R.B. 1359, 1377 (1985) (noting

employer’s continuation of dues checkoff notwithstanding

expiration of contract between parties). The Company therefore

claims, and the Union does not dispute, that after expiration of

the contract the Company was at liberty to continue payroll

deduction of union dues even though it could lawfully terminate

the deduction.

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The Company’s primary argument is that the direct deposit

of union dues was merely the “reinstitution” of dues checkoff

under the CBA; the Company is claiming, in other words, that

when the direct deposit of union dues was implemented it was

as if the Company had never discontinued dues checkoff. That

is, the Company effectively was still operating under the

conditions of an expired CBA, i.e., that the Company was

entitled to cease dues checkoff at its discretion. We disagree.

When the Company discontinued dues checkoff, it unilaterally

terminated the practice. Because it is undisputed that dues

checkoff is a term or condition of employment, it could not be

“reinstituted” under the expired CBA. See NLRB v. Katz, 369

U.S. 736, 743 (1962) (holding “that an employer’s unilateral

change in conditions of employment under negotiation is . . . a

violation of s 8(a)(5)”). The practice could only be instituted

again under a new agreement.

The Company argues that even if its argument that dues

checkoff and direct deposit of union dues are identical is

rejected, the use of direct deposit is nevertheless unauthorized

under Section 302 of the Labor Management Relations Act

(“LMRA”), 29 U.S.C. §§ 141-144, 171-183, 185-187 (1998).

Section 302 states that it is 

unlawful for any employer . . . to pay, lend, or deliver,

or agree to pay, lend, or deliver, any money or other

thing of value . . . to any labor organization . . . which

represents . . . any of the employees of such employer

[except] with respect to money deducted from the

wages of employees in payment of membership dues in

a labor organization: Provided, That the employer has

received from each employee, on whose account such

deductions are made, a written assignment which shall

not be irrevocable for a period of more than one year,

or beyond the termination date of the applicable

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collective agreement, whichever occurs sooner.

29 U.S.C. §§ 186(a), (a)(2), (c). The Company claims that the

new agreement is not in accordance with Section 302 because

union dues can be deducted from an employee’s paycheck only

if there is in existence a signed collective bargaining agreement

that contains a provision authorizing payroll deduction of union

dues. The Company suggests that no such agreement was

created at the time direct deposit of union dues took place. The

NLRB, in turn, claims that Tribune errs when it argues that

under Section 302 the direct deposit agreement could not be

enforced because there was no signed, existing union contract.

Taking issue with Tribune’s argument that Section 302 requires

that any agreement for payroll deduction of union dues must be

in writing in a signed union contract, the NLRB asserts that

Tribune cites no cases to support that claim. Noting that

Section 302 provides for deduction of union dues if employees

have given written consent and that their consent is revocable

after a year or, if sooner, the expiration of the union contract, the

NLRB states that there is no dispute that the direct deposit

authorizations at issue here were revocable at will.

The Company suggests that even if it is determined that it

made a new agreement to use direct deposit to deduct union

dues, the agreement is void because Section 302 of the LMRA

requires that any such agreement be reduced to writing in a

signed CBA. But the Company, as the NLRB points out, cites

no authority for this claim. Section 302 does not require a

written collective bargaining agreement. In order for payroll

deduction of union dues to be lawful, Section 302 requires

merely that employees give written consent that is revocable

after a year. Here, as even the Company describes it, the direct

deposit of union dues was “a written assignment, and . . .

nothing but dues deduction in an altered form.” Presumably

most of the time payroll deductions of union dues will in fact be

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made pursuant to a CBA provision. But such procedure is not

the only one available; as the ALJ noted, employees might

choose the Company’s direct deposit procedure over any

collective bargaining agreed upon dues deduction procedure.

We have considered the Company’s remaining arguments

and find them to be without merit. In sum, we conclude that the

NLRB’s decision has substantial evidentiary support and is

consistent with the law.

Conclusion

For the reasons set forth above, we deny the Company’s

petition for review and grant the NLRB’s cross-application to

enforce its order.

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