Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caDC-07-01479/USCOURTS-caDC-07-01479-0/pdf.json

Parties Involved:
Associated Builders and Contractors, Inc.
Amicus Curiae for Respondent
National Labor Relations Board
Respondent
Oil Capitol Sheet Metal, Inc.
Intervenor for Respondent
Sheet Metal Workers International Association
Petitioner

Document Text:

United States Court of Appeals 

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued February 17, 2009 Decided April 3, 2009 

No. 07-1479 

SHEET METAL WORKERS INTERNATIONAL ASSOCIATION,

LOCAL 270, AFL-CIO, 

PETITIONER

v. 

NATIONAL LABOR RELATIONS BOARD, 

RESPONDENT

OIL CAPITOL SHEET METAL, INC., 

INTERVENOR

No. 08-1009 

CARPENTERS’ DISTRICT COUNCIL OF KANSAS CITY AND 

VICINITY, LOCALS 311 AND 978, AFFILIATED WITH THE UNITED 

BROTHERHOOD OF CARPENTERS AND JOINERS OF AMERICA, 

PETITIONERS

v. 

NATIONAL LABOR RELATIONS BOARD, 

RESPONDENT

EPI CONSTRUCTION COMPANY, 

INTERVENOR

USCA Case #07-1479 Document #1174017 Filed: 04/03/2009 Page 1 of 9
2

Consolidated with 08-1039, 08-1081 

On Petitions for Review and Cross-Application for 

Enforcement of Orders of the 

National Labor Relations Board 

Michael T. Anderson argued the Standing and the Merits 

of the Board’s Oil Capitol Rule for petitioner Sheet Metal 

Workers International Association. With him on the briefs 

were Arlus J. Stephens and Loren Gibson. 

Michael J. Stapp argued the Standing and the Merits of 

the Board’s Oil Capitol Rule for petitioners Carpenters’ 

District Council of Kansas City and Vicinity, Locals 311 and 

978. With him on the briefs was Charles R. Schwartz. 

Jason Walta, Attorney, National Labor Relations Board, 

argued the Standing and the Merits of the Board’s Oil Capitol 

Rule for respondent. With him on the brief were Ronald E. 

Meisburg, General Counsel, John H. Ferguson, Deputy 

General Counsel, Linda Dreeben, Deputy Associate General 

Counsel, and Meredith L. Jason, Supervisory Attorney. 

Maurice Baskin argued the Standing and the Merits of the 

Board’s Oil Capitol Rule for intervenor Oil Capitol Sheet 

Metal, Inc. and amicus curiae Associated Builders and 

Contractors, Inc. in support of respondent. With him on the 

brief was Robert A. Hirsch. 

Donald W. Jones argued the Merits of the Unfair Labor 

Practices and filed the briefs for petitioner EPI Construction 

Company. 

USCA Case #07-1479 Document #1174017 Filed: 04/03/2009 Page 2 of 9
3

Steven Goldstein, Attorney, National Labor Relations 

Board, argued the Merits of the Unfair Labor Practices for 

respondent. With him on the brief were Ronald E. Meisburg, 

General Counsel, John H. Ferguson, Deputy General Counsel, 

Linda Dreeben, Deputy Associate General Counsel, and 

Robert J. Englehart, Supervisory Attorney. 

Michael J. Stapp argued the Merits of the Unfair Labor 

Practices for intervenors Carpenters’ District Council of 

Kansas City and Vicinity Locals 311 and 978. 

Donald W. Jones was on the brief for intervenor EPI 

Construction Company in support of respondent. 

Before: ROGERS, Circuit Judge, and WILLIAMS and 

RANDOLPH, Senior Circuit Judges. 

Opinion for the Court filed by Senior Circuit Judge

WILLIAMS. 

WILLIAMS, Senior Circuit Judge: “Salts” are union 

members, and sometimes union employees, who apply for a 

job with an unorganized employer, seeking either to organize 

the employer’s workforce or to precipitate conditions 

favorable to a future organizational campaign. See Oil 

Capitol Sheet Metal, Inc., 349 NLRB 1348, 1348 n.5 (2007) 

(“Oil Capitol”); NLRB v. Town & Country Elec., Inc., 516 

U.S. 85, 87, 96 (1995). This case is about the National Labor 

Relations Board’s new evidentiary rule for determining 

backpay and instatement liability in cases of unfair labor 

practices committed against salts. In Oil Capitol, the Board 

concluded that “the traditional presumption that the backpay 

period should run from the date of discrimination until the 

[employer] extends a valid offer of reinstatement” did not 

make sense in the salting context, given the limited duration 

of salts’ employment objectives with the targeted employer 

USCA Case #07-1479 Document #1174017 Filed: 04/03/2009 Page 3 of 9
4

(as opposed to those of regular job applicants, who typically 

seek indefinite employment). Oil Capitol, 349 NLRB at 

1349. Instead, the Board announced a new rule that would 

require its General Counsel, “as part of his existing burden of 

proving a reasonable gross backpay amount due, to present 

affirmative evidence that the salt/discriminatee, if hired, 

would have worked for the employer for the backpay period 

claimed in the General Counsel’s compliance specification.” 

Id. In a later case now also before us, the Board similarly 

ordered that the rule should govern determination of the 

remedy. Exceptional Professional, Inc., 350 NLRB 985, 985 

n.5 (2007) (“EPI”). 

The unions involved in the Oil Capitol and EPI orders are 

challenging the Oil Capitol rule as discriminatory against 

salts. Exceptional Professional, Inc., the responding employer 

in the EPI case, also filed a petition, challenging several 

adverse findings of unfair labor practices. The Board in turn 

cross-applied to enforce these findings against Exceptional 

Professional. 

We do not get to the merits of the union petitioners’ 

challenge to the Oil Capitol rule; at this stage, with the 

compliance proceedings still ahead, the challenge is unripe. 

We therefore dismiss the petitions insofar as they attack the 

Oil Capitol rule. As for the claims brought by Exceptional 

Professional on the merits of the EPI order, we deny these 

(and thus grant the Board’s cross-application to enforce the 

order) in an unpublished judgment issued simultaneously with 

this opinion. 

* * * 

First, a few words on the evidentiary standards governing 

backpay calculations and the instatement remedy in unfair 

USCA Case #07-1479 Document #1174017 Filed: 04/03/2009 Page 4 of 9
5

labor practice cases. The Board’s general course of action is 

to “order[] the conventional remedy of reinstatement with 

backpay, leaving until the compliance proceedings more 

specific calculations.” Sure-Tan, Inc. v. NLRB, 467 U.S. 883, 

902 (1984). The point of the compliance proceedings is to 

tailor the remedy to the facts of the violation. Id. 

In all compliance proceedings, the burden of proving the 

amount of backpay due lies with the Board’s General 

Counsel. Oil Capitol, 349 NLRB at 1351. Before the Oil 

Capitol decision, however, the Board applied a rebuttable 

presumption that a discriminatee, salt or not, is entitled to 

backpay from the date of unlawful refusal to hire to the date 

of eventual instatement. See Tualatin Elec., Inc. v. NLRB, 

253 F.3d 714, 718 (D.C. Cir. 2001). Because every 

discriminatee was presumed likely to have remained with the 

wrongdoing employer indefinitely but for the employer’s 

unlawful conduct, the Board also presumed a right of 

instatement. See Dean General Contractors, 285 NLRB 573, 

575 (1987). The burden of overcoming these presumptions 

rested with the responding employer. Of course the employer 

“retain[ed] the correlative right to seek out and to present 

evidence that a salt would not have” continued working for 

the employer, “whether by reason of the union’s policies or of 

its own.” Tualatin, 253 F.3d at 718. Contrary to the union 

petitioners’ insistence, Sheet Metal Br. 18, there was no such 

thing as a right to “immediate and unconditional” instatement 

under the old rule; such a rule would have entailed automatic 

Board orders requiring that the salt be offered a job before the 

completion of compliance proceedings. Instead, instatement 

and backpay issues are left to be resolved “by a factual 

inquiry” in the compliance process. Dean, 285 NLRB at 575. 

The Oil Capitol rule eliminates the rebuttable 

presumption in cases involving union salts. Instead, the rule 

places with the General Counsel the additional “burden of 

USCA Case #07-1479 Document #1174017 Filed: 04/03/2009 Page 5 of 9
6

going forward with the evidence in regard to the length of the 

backpay period” and “the burden of going forward with the 

evidence that the discriminatee would still be employed by the 

[responding employer] if he had not been the victim of 

discrimination.” Oil Capitol, 349 NLRB at 1354. 

Such evidence may include, but is not limited to, the 

salt/discriminatee’s personal circumstances, 

contemporaneous union policies and practices with 

respect to salting campaigns, specific plans for the 

targeted employer, instructions or agreements between 

the salt/discriminatee and union concerning the 

anticipated duration of the assignment, and historical data 

regarding the duration of employment of the 

salt/discriminatee and other salts in similar salting 

campaigns. 

Id. at 1349. And because instatement and backpay are closely 

intertwined (truncation of the latter cuts off the former), the 

right to instatement under the new rule “is subject to 

defeasance . . . if, at the compliance stage, the General 

Counsel fails to carry this burden of persuasion.” Id. at 1354. 

* * * 

The union petitioners are challenging the Oil Capitol rule 

before seeing how it actually plays out in the compliance 

proceedings. This poses a jurisdictional issue—whether the 

challenge is ripe. 

Ripeness depends on “[1] the fitness of the issues for 

judicial decision and [2] the hardship to the parties of 

withholding court consideration.” Fed. Express Corp. v. 

Mineta, 373 F.3d 112, 118 (D.C. Cir. 2004) (quoting Abbott 

Labs. v. Gardner, 387 U.S. 136, 149 (1967)). “In applying 

the ripeness doctrine to agency action we balance the interests 

USCA Case #07-1479 Document #1174017 Filed: 04/03/2009 Page 6 of 9
7

of the court and the agency in delaying review against the 

petitioner’s interest in prompt consideration of allegedly 

unlawful agency action.” Id. (internal quotations omitted). 

In Federal Express—a case dealing with the recovery of 

losses that commercial airlines incurred as a result of post9/11 grounding orders—we held that petitioners’ challenge to 

rebuttable accounting presumptions was not fit for review 

before the agency made the calculations. First, we said, the 

case dealt with rebuttable presumptions, leading to 

“uncertain[ty] whether they will ever have the effect of 

depriving any of the Carriers of any compensation.” Id. at 

119 (declining “to anticipate a wrong when none may ever 

arise” (internal quotation omitted)). And second, we reasoned 

that “if and when [an actual wrong] does come to pass, 

judicial review of the issue ‘is likely to stand on a much surer 

footing in the context of a specific application of this 

regulation than could be the case in the framework of the 

generalized challenge made here.’” Id. (quoting Toilet Goods 

Ass’n, Inc. v. Gardner, 387 U.S. 158, 164 (1967)). 

These reasons apply with equal force in our case. First, 

the compliance proceedings have not yet taken place, and so 

at this point we do not know what effect, if any, the new 

evidentiary rule will have on backpay and instatement 

remedies. All that the Oil Capitol rule did was to remove a 

rebuttable presumption, forcing the Board’s General Counsel 

to present affirmative evidence that a discriminatee would 

have remained with the employer up to the time of the 

compliance decision. In Federal Express, challengers 

attacked a rebuttable presumption; here they attack its 

removal. The implication is the same—we do not know 

whether the new rule will have any impact on the ultimate 

remedy. 

USCA Case #07-1479 Document #1174017 Filed: 04/03/2009 Page 7 of 9
8

Second, if and when the compliance proceedings do 

result in an actual injury, the union petitioners’ challenge will 

come to us in a concrete factual context, shedding light on 

how the new rule operates in practice. The unions’ claims 

here make details of the rule’s operation particularly vital. 

They say the new rule will force them to turn over to the 

General Counsel documents revealing their organizing 

strategies, which they argue are the “equivalent of trade 

secrets.” Sheet Metal Br. 13. These documents, the argument 

goes, will then end up in the hands of “the very employer who 

has already violated the Act to suppress organizing.” Id. 

As the Board responds, however, we do not yet know 

whether sensitive documents will be at issue, or whether the 

risk of their exposure will be any greater than under the prior 

rule. The General Counsel may choose to rely solely on the 

discriminatees’ personal circumstances, obviating the need to 

put union organizing strategies into evidence during the 

compliance stage. NLRB Sheet Metal Br. 25. Alternatively, 

if the unions believe the General Counsel’s subpoenas intrude 

unduly into internal matters, they may resist, thus putting the 

Board to a choice between petitioning for enforcement in the 

district court, or proceeding without the information. See 29 

C.F.R. § 102.31(b), (d). Even assuming the union’s 

organizing plans will be introduced into evidence, and further 

assuming they are in fact the equivalent of trade secrets—a 

point the NLRB does not concede—the Board may be able to 

shield the information from being disclosed to the employer. 

“The Board is well equipped to ensure that a party’s sensitive 

information is protected, whether through the use of protective 

orders, in camera review, filing exhibits under seal, or 

otherwise.” NLRB Sheet Metal Br. 27. The union petitioners 

are contesting the existence and efficacy of these measures, 

but the basic point remains true—we do not yet have enough 

information to know. Further, as we said in Tualatin, the 

employer was entitled under the old rule “to seek out and to 

USCA Case #07-1479 Document #1174017 Filed: 04/03/2009 Page 8 of 9
9

present evidence,” 253 F.3d at 718, so it is quite unclear 

whether there will be any increased scrutiny of union plans. 

Delaying judicial review can eliminate guesswork in this area. 

Lastly, we do not perceive any hardship to the union 

petitioners from withholding our review at this point. The 

petitioners fear losing the opportunity to challenge the Oil 

Capitol rule if they wait until the compliance proceedings, but 

they need not fear. While failure to object to a remedial rule 

enunciated in a Board merits decision may forfeit an attack 

when the remedial rule is objectionable on its face, see 

Scepter, Inc. v. NLRB, 448 F.3d 388, 391–92 (D.C. Cir. 2006) 

(contrasting NLRB v. Katz’s Delicatessen of Houston Street, 

Inc., 80 F.3d 755, 771 (2d Cir. 1996)), the remedial rule here 

is not objectionable on its face (for the reasons just 

developed), and in any event the unions have (obviously) 

raised their objections. See also Tualatin, 253 F.3d at 717–18 

(allowing employer, after compliance proceeding, to 

challenge the Dean presumption that preceded the Oil Capitol

rule). For now, therefore, the issue is unripe. And the same 

goes for the Carpenters’ argument against applying the Oil 

Capitol rule to events transpiring before its announcement. 

* * * 

The unions’ petitions for review are therefore 

Dismissed. 

USCA Case #07-1479 Document #1174017 Filed: 04/03/2009 Page 9 of 9