## F I L E D United States Court of Appeals Tenth Circuit 

### JUN 18 2003 

### PATRICK FISHER Clerk 

### PUBLISH UNITED STATES COURT OF APPEALS

TENTH CIRCUIT

NATIONAL LABOR RELATIONS BOARD, Petitioner,

v. OKLAHOMA FIXTURE COMPANY, Respondent. No. 01-9516

ON REHEARING EN BANC FROM AN APPLICATION FOR ENFORCEMENT OF AN ORDER FROM THE NATIONAL LABOR RELATIONS BOARD (Nos. 17-CA-18734 and 17-CA-19036)
Ruth E. Burdick, Attorney, (David Habenstreit, Supe rvisory Attorney, Arthur F. Rosenfeld, General Counsel, John E. Higgins, Jr., D eputy General Counsel, John H. Ferguson, Associate General Counsel, Aileen A. A rmstrong, Deputy Associate General Counsel, with her on the brief) of the Nati onal Labor Relations Board, Washington, D.C., for Petitioner. D. Kevin Ikenberry, (Stephen L. Andrew, with him onthe briefs) of Stephen L. Andrew & Associates, A Professional Corporation, Tu lsa, Oklahoma, for Respondent.

Before TACHA , Chief Judge, SEYMOUR , EBEL , KELLY , HENRY , BRISCOE , LUCERO , MURPHY , HARTZ , O’BRIEN and McCONNELL , Circuit Judges.1 Section 302(a) provides: “It shall be unlawful forany employer . . . to

pay, lend, or deliver, or agree to pay, lend or del iver, any money or other thing of value (1) to any representative of any of his emplo yees . . . or (2) to any labor organization . . . .” 29 U.S.C. § 186(a). Section 302(b) prohibits labor organizations from demanding such payments from emp loyers. Id. § 186(b). -2- SEYMOUR , Circuit Judge.

The National Labor Relations Board (Board) seeks anorder enforcing its determination that Oklahoma Fixture Company did notviolate section 302 of the Labor Management Reporting Act, 29 U.S.C. § 186 1 by deducting permit fees from employee paychecks and remitting them to the u nion, and therefore that the company violated sections 8(a)(5) and (1) of the National Labor Relations Act, 29 U.S.C. §§ 158(a)(5) and (1), by unilaterally discon tinuing that practice. A panel of this court held that the statutory phrase “membe rship dues” at issue in the Board decision is unambiguous, declined to defer to the Board’s construction of section 302, and denied enforcement. NLRB v. Okla. Fixture Co., 295 F.3d 1143 (10th Cir. 2002). We granted the Board’s request f or rehearing en banc and now determine that under governing Supreme Court author ity, the statute is ambiguous, the Board’s interpretation is reasonable , and the Board’s order should be enforced.2 Section 302(c)(4) provides that the section does n ot apply “with respect to

money deducted from the wages of employees in payme nt 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.” 29 U.S.C. § 186(c)(4).

3 We note that whether particular payments may be re quired as membership dues under section 8(a)(3) is an entirely separate issue from whether they are a permissible subject of check-off under section 302( c)(4). See , e.g. , NLRB v. Food (continued...) -3- I Section 302 criminalizes money payments between emp loyers and unions but provides various exceptions for payments relate d to legitimate business between those entities. Under one of these excepti ons, section 302(c)(4), employers may forward to the union payments of “mem bership dues” deducted from employees’ paychecks pursuant to their authori zation cards. 2 The employees in this case are probationary workers in their first ninety days of employment, during which time they are not required by the collective bargaining agreement (CBA) to join the union. Thes e employees nevertheless were required to pay permit fees to the union aftertheir first thirty days of employment. See Oklahoma Fixture Co. , 331 NLRB 1116, 1122 (2000). They made these payments pursuant to a “check-off ” prov ision: in other words, they signed cards authorizing their employer, Oklahoma F ixtures Company, to deduct the amount of the permit fees (or any other fees) f rom their paychecks and forward this amount to the union. 3 Oklahoma Fixtures participated in this check-3 (...continued)

Fair Stores, Inc ., 307 F.2d 3, 12 (3d Cir. 1962); Grajczyk v. Douglas Aircraft Co. , 210 F. Supp. 702, 705-06 (S.D. Cal. 1962) (holding that check-off for agency fees does not violate section 302 but noting “[w]hether or not the agreement by which [check-off for agency fees] was brought about is an unfair labor practice or otherwise unlawful is quite a different question . . .”). The section 8(a)(3) question has not been raised in the case before us. -4- off process for eight years until it was advised bycounsel to cease, which it did without consulting the union. As a result, the uni on filed unfair labor practice charges against the company. The issue in this case is whether Oklahoma Fixtures engaged in criminal conduct as defined under section 302 by forwarding these employees’ permit fees to their union, or whether forwarding such payments constituted non-criminal conduct under the section 302(c)(4) exception for “ membership dues.” The Board determined that the permit fees at issue here are “ membership dues” and therefore excepted from the criminal provision. Okla. Fixture Co. , 331 NLRB 1116, 1120- 22 (2000). The Board observed that the Department of Justice, which is the agency responsible for enforcing section 302, the B oard itself, and numerous courts have consistently interpreted “membership du es” broadly to include initiation fees and other assessments of employees by their unions, as well as agency fees paid by nonmembers. The Board determin ed that the permit fees are analogous to dues, noting that probationary employe es are members of the collective bargaining unit and are therefore legiti mate subjects of service fees for-5-

the union’s representation even though they are notrequired to be union members. On this basis, the Board concluded the permit fees are permissible “membership dues” under section 302. Oklahoma Fixtures appeale d. Sitting en banc, we enforce the Board’s order.
II As the Supreme Court noted in Holly Farms Corp. v. NLRB , 517 U.S. 392 (1996): If a statute’s meaning is plain, the Board and revi ewing courts “must give effect to the unambiguously expressed in tent of Congress.” Chevron U.S.A. Inc. v. Natural Resources Defense Council, Inc. , 467 U.S. 837, 843 (1984). When the legislative prescription is not free from ambiguity, the admini strator must choose between conflicting reasonable interpretatio ns. Courts, in turn, must respect the judgment of the agency empow ered to apply the law “to varying fact patterns,” [ Bayside Enterprises, Inc. v. NLRB , 429 U.S. 298, 304 (1977)], even if the issue “wit h nearly equal reason [might] be resolved one way rather tha n another, id. at 302 (citing [ Farmers Reservoir & Irrigation Co. v. McComb , 337 U.S. 755, 770 (1949)] (Frankfurter, J., concurring) ). Id. at 398-99. Under the Chevron line of cases, therefore, if the statutory phrase in a labor statute is ambiguous, we usually defer t o the Board’s reasonable interpretation of it. We are dealing here with a c riminal provision, however, and it is not entirely clear exactly how the Chevron analysis is affected by the presence of criminal liability in a statute being i nterpreted by an agency. The Supreme Court has held that “some degree of deferen ce” is owed to an agency’s interpretation of a criminal provision, although th e degree of deference may be4 Legal scholarship indicates a split of opinion on deference to an agency’s

interpretation of a criminal statute. Compare Sanford N. Greenberg, Who Says it’s a Crime?: Chevron Deference to Agency Interpre tations of Regulatory Statutes that Create Criminal Liability , 58 U. P ITT
. L. REV . 1 (1996) (arguing against criminal liability exception to Chevron ) with Mark D. Alexander, Note, Increased Judicial Scrutiny for the Administrative Crime , 77 C ORNELL L. REV
. 612 (1992) (arguing for criminal liability exceptio n to Chevron ); see also Cass R. Sunstein, Law and Administration After Chevron , 90 C OLUM
. L. REV . 2071 (1990) (advocating a more curtailed application of Chevron ); Cynthia R. Farina, Statutory Interpretation and the Balance of Power i n the Administrative State , 89 C OLUM
. L. REV . 452 (1989) (advocating wholesale rejection of Chevron ). -6- dependent upon considerations of the agency’s parti cular expertise and the policies implicated by the criminal statute in ques tion, as well as the extent to which Congress has charged the agency with administ ering the criminal statute. See Babbitt v. Sweet Home Chapter of Cmties. for a Greater Ore. , 515 U.S. 687, 703-04 & n.18 (1995), citing Stephen Breyer, Judicial Review of Questions of Law and Policy , 38 A DMIN
. L. REV
. 363, 372-73 (1986); see also Seneca-Cayuga Tribe of Okla. v. Nat’l Indian Gaming Comm’n , No. 01-5066, 2003 WL 1889944 (April 17, 2003) (determining “no deference” owed t o National Indian Gaming Commission’s construction of Johnson Act because Un ited States Department of Justice, rather than NIGC, is charged with administ ering statute). 4 Here, there is a need for a uniform national unders tanding of the meaning of the statute in question from a labor law standpo int, and the Board has special expertise regarding the labor law implications of t he statute. If we determine the statute is ambiguous, therefore, it is appropriate to afford some deference to the5 It is a general rule of statutory interpretation t hat criminal statutes must be

construed narrowly, and that exceptions to those st atutes must be construed broadly. See United States v. Bass , 404 U.S. 336 (1971).

6 The panel majority relied on the collective bargai ning agreement (CBA) as indicating that permit fees are not “membership dues” within the ambit of the statute. See NLRB v. Okla. Fixtures Co., 295 F.3d 1143, 1145-46 (10th Cir. 2002). However, the contractual meaning of the ter m “membership dues” in the CBA is irrelevant to the statutory interpretation i ssue. The statute itself, rather than the CBA, controls the meaning of the phrase in section 302. -7- Board interpretation as long as it is a reasonable or permissible one, and not in conflict with interpretive norms regarding criminal statutes. 5

III Prior constructions of the phrase “membership dues” by the Supreme Court and other circuits persuade us that the meaning of the phrase as used in section 302 is not plain. 6 For example, the Supreme Court has held in a diff erent context that payments other than those by actual union memb ers can constitute “membership dues” under labor statutes. See NLRB v. General Motors Corp ., 373 U.S. 734 (1963); see also Marquez v. Screen Actors Guild, Inc ., 525 U.S. 33 (1998). These cases considered the treatment of “d ues” under section 8(a)(3) of the National Labor Relations Act, 29 U.S.C. § 158(a ), which makes it unlawful for an employer to pay employees in an attempt to i nfluence their decisions7The term used in section 8(a)(3) is actually “peri odic dues” paid for

“acquiring or maintaining membership” rather than “ membership dues” as used in section 302.

8 While probationary employees do not receive all th e protections of the union contract, they are members of the collective bargaining unit and receive some of the benefits of such membership. Therefore , while they might claim they (continued...) -8- regarding union membership. 7Membership “dues” was interpreted narrowly under section 8(a)(3) because employees can be disc harged for failing to pay union membership dues. Because section 8(a)(3) grants unions coercive power over workers’ employment, the term was interpreted narrowly to limit the scope of that power. See General Motors , 373 U.S. at 740-43. Even so, the Supreme Court has stated on more than one occasion that the “dues” in section 8(a)(3) incorporates more than its literal meaning suggests

. See Marquez , 525 U.S. at 46; General Motors , 373 U.S. at 742. Thus, in construing section 8(a )(3) in General
Motors the Court held that agency fees, which are payment s by non-members as service fees to the union for the benefits of repre sentation, constitute “membership dues.” General Motors , 373 U.S. at 741-42. While both section 8(a)(3) and section 302 are labo r statutes and both contain the term “dues,” the prescriptions, purpose , and previous interpretations of “dues” in each differ. Section 8 is aimed at pr otecting employees from union and employer coercion. Section 8(a)(3) prohibits c ompulsory unionism but does permit CBAs to require employees to compensate unio ns for representation. 8 The8 (...continued)

should pay lower dues based on receiving fewer bene fits than more senior workers, it arguably does not violate section 8(a)( 3) to require probationary employees to pay dues generally as long as they are not required to do so in the first thirty days of employment. See 29 U.S.C. § 158(a)(3) (“[N]othing in this sub-chapter . . . shall preclude an employer from m aking an agreement with a labor organization . . . to require as a condition of employment membership therein on or after the thirtieth day . . .”). -9- purpose of section 302, on the other hand, is to pr event corruption between unions and employers, not to cabin any coercive power of t he union over employees. Unlike compulsory dues permitted under section 8(a) (3), section 302(c)(4) authorizes the company to deduct the permit fees atissue in this case only after employees submit authorization cards to this effect

. Section 302(c)(4) must be interpreted broadly becau se it concerns an exception to a criminal statute. See NLRB v. Food Fair Stores, Inc. , 307 F.2d 3, 12 (3d Cir. 1962) (“The broad construction granted in the administration of section 302 by the Department of Justice is consist ent with the criminal character of the sanctions it embodies.”). See also Int’l Union of Mine Mill & Smelter Workers, Local 515 v. American Zinc, Lead & Smelter Co. , 311 F.2d 656, 659 (9th Cir. 1963) (hereinafter “American Zinc ”); Grajczyk v. Douglas Aircraft Co. , 210 F. Supp. 702, 704-06 (S.D. Cal. 1962). Consequ ently, it is highly unlikely that “dues” in section 8(a)(3) would encompass non- obvious interpretations and refinement but “dues” in section 302 would not. In other words, since periodic or-10-

membership dues have been construed more narrowly i n section 8(a)(3) than in section 302(c)(4), the fact that the term comprehen ds more than the literal meaning in section 8(a)(3) leads to the conclusion that it does so in section 302(c)(4) as well. The fact that the term “dues” i s construed differently in the two statutes in itself strongly suggests that the m eaning of “dues” is ambiguous rather than plain. Indeed, the Ninth Circuit has e xpressly held that the term “membership dues” in section 302(c)(4) is ambiguous

. American Zinc , 311 F.2d
at 660. If the meaning of “membership dues” were plain, we would be required to accept its literal meaning. The literal meaning, h owever, would exclude agency fees which the Supreme Court has held are covered u nder section 8(a)(3), General
Motors , 373 U.S. 734, and which undoubtedly fall within t he section 302(c)(4) exception as well, see Grajczyk, 210 F. Supp. at 705-06. Oklahoma Fixture’s argument that agency fees are in factmembership dues, rather than included in “dues” as a matter of statutory construction, is no t convincing. Employees who opt not to join the union but instead pay agency fe es in lieu of membership dues are not members of the union. They specifically pay agency fees so they will not have to become union members to maintain employment . The Supreme Court made this clear in General Motors , where its holding that agency fees are “membership dues” under section 8(a)(3) was based o n two conclusions: the-11-

statute “made significant alterations in the meanin g of ‘membership’ for the purposes of union-security contracts,” and this meaning incorporated the clear intent of Congress to permit union security agreeme nts under that statute. General Motors , 373 U.S. at 742. In light of all of these considerations, we conclud e that the meaning of “membership dues” in section 302 is ambiguous.

IV Having determined that the statutory language is no t plain, we now turn, under Chevron and Sweet Home Chapter , to analysis of whether the Board’s interpretation is reasonable. The Board’s construc tion of “membership dues” is supported by a convincing rationale and easily meet s the “reasonableness” standard we apply to Board interpretations of laborlegislation. See Holly Farms Corp. , 517 U.S. at 409. The Board’s rationale is supported by those cases upholding broad interpretations of the exceptions t o section 302. The Second Circuit held that a tax imposed over and above dues falls within section 302(c)(4). See Schwartz v. Assoc. Musicians of Greater NY , 340 F.2d 228, 233-34 (2d Cir. 1964). In doing so, the court reasoned that a narrow construction of the section is not consistent with the limited purpose of the statute, the taxes are similar to dues, it is irrel evant that the taxes were not-12-

required as a condition of employment, and there is no other logical or practical reason the taxes should not be permitted under sect ion 302. Id. In American
Zinc , the Ninth Circuit held strike assessments to be apermissible subject of check-off under section 302. It noted the consiste nt positions of the Department of Justice and the Board on the meaning of “dues,” which excludes “assessments” from section 8(a)(3) but not from section 302, and further noted that interpreting dues in section 302(c)(4) more broadly than in sect ion 8(a)(3) is consistent with the different provisions and purposes of those two statutes. American Zinc , 311 F.2d at 659-60. Similarly, in Food Fair Stores , the Third Circuit upheld the Board’s consistent position that strike assessments are “dues” under section 302 but not under section 8(a)(3) because the position is “not contrary to any clearly expressed legislative intent and [is] totally reaso nable.” Food Fair Stores, 307 F.2d at 16. Finally, in holding agency fees legal under section 302(c)(4) even though they do not fall within the literal interpre tation of “membership dues,” the court in Grajczyk

reasoned that the prohibitions of the statute are directed at the relationship between the employer and the union, pe rmitting agency fees is “thoroughly consistent” with the purpose of the statute, and there is no practical difference between agency fees and members’ dues. Grajczyk, 210 F. Supp. at 705-06. The reasoning of these cases supports the conclusion that the permit fees at issue here fall under section 302(c)(4). They a re not related to union-employer-13-

corruption, they resemble dues paid by actual membe rs, and it is consistent with the Board’s long-standing position to so hold. See Holly Farms Corp ., 517 U.S.
at 405-09. Furthermore, case law instructs us that not only is the purpose of a particular payment relevant to determining whether it constitutes “dues,” a “union security” purpose is a particularly relevant indication. The Supreme Court has noted with approval the Board’s consideration of th e purpose of payments made by members in determining whether those payments co nstitute “periodic dues” in section 8(a)(3). Communications Workers of America v. Beck, 487 U.S. 735, 752 n. 7 (1988); see also Master Insulators v. Int’l Ass’n of Heat & Frost Insulators , 925 F.2d 1118, 1122-23 (8th Cir. 1991); Assoc. Builders & Contractors v. Carpenters Vacation and Holiday Trust Fund for N. Cal. , 700 F.2d 1269, 1275 (9th Cir. 1983). The Court in Beck placed great importance specifically on a “union security” purpose in determining whether pay ments qualify as “dues,” indicating that “union security” is the core legiti mate purpose of dues themselves. There, the Court addressed whether unions could spe nd required agency fees on anything other than representation activities for t he direct benefit of employees in the bargaining unit. While the Court decided that unions could not require employees they represent to pay for activities such as political organizing, the Court affirmed that dues unquestionably includes fe es whose purpose is to9 Under the CBA, while the probationary employees do not obtain all of the

benefits of the CBA, notably seniority rights and a ccess to the grievance process, many of their work conditions are nevertheless prod ucts of the collective bargaining process, such as their rate of pay and o n-the-job health and safety rules. Whether the permit fee is the appropriate a mount in light of the partial benefits probationary employees receive is a questi on of fair representation that is (continued...) -14- support union security. Beck, 487 U.S. at 747-54. The Court made it clear that “dues” has always included at least payments by emp loyees who might otherwise be free riders – payments to compensate the union f or its representation. Id. General Motors reflects a similar rationale. The Court interpret ed “dues” in section 8(a)(3) to include agency fees by construin g “dues” to reflect Congress’ intent to preserve union security agreements even t hough the term does not literally encompass agency fees. General Motors , 373 U.S. at 740-44. Here, probationary employees are a legitimate subje ct of union security because they are members of the bargaining unit and are covered by the CBA. As noted above, unions are legally obligated to repres ent all employees in the bargaining unit, not just those who are union membe rs. Union security agreements allow unions to obtain “service fees,” o r dues-like compensation, from employees they are obligated to represent but who opt not to join the union. The probationary employees are similarly a legitimate subject of union security because they are members of the bargaining unit, ar e covered by the CBA, and are owed a duty of fair representation like other membe rs of the bargaining unit. 99 (...continued)

not before us, but the fact that they receive some benefits under the CBA means they do receive representation from the union. -15- See , e.g. , Hodges v. Atchison, Topeka & Santa Fe Ry. Co. , 728 F.2d 414, 417 (10th Cir. 1984). Thus, the permit fees compensate the union for its representation of the probationary employees. In e ffect, membership dues are defined to cover all members of the bargaining unitrather than just members of the union. This is a rational way to interpret mem bership dues under section 302 because it is consistent with the inclusion of agen cy fees and, more generally, encompasses exactly those members of the unit to wh om a union owes a duty of fair representation and from whom a union may legit imately collect service fees. In conclusion, we hold that the term “membership du es” in section 302(c)(4) is ambiguous and that the Board’s interpr etation of that language to include the permit fees in this case is reasonable. Accordingly, we ENFORCE the Board’s order.1 These factors, in my view, arguably distinguish t his case from Babitt v.

Sweet Home Chapter of Cmties. for a Greater Ore. , 515 U.S. 687 (1995), which involved the Secretary of Interior’s interpretation of a statute, the Endangered Species Act of 1973 (ESA), that carried both civil and criminal penalties. Because the Secretary of Interior had enforcement a uthority over the civil penalty provisions of the ESA, it is understandable why som e deference was owed to the Secretary’s interpretation of that statute. No. 01-9516, NLRB v. Oklahoma Fixture Co. BRISCOE , Circuit Judge, concurring, with whom HENRY , Circuit Judge, joins:
I concur in the result reached by the majority. I write separately because I am not persuaded that any deference is owed to the Board’s interpretation of the phrase “membership dues,” as used in section 302(c) (4) of the National Labor Relations Act, 29 U.S.C. § 186(c)(4). Section 302, although generally part of the Act, is a criminal statute. Its enforcement thus lies not with the Board, but presu mably with the Department of Justice (DOJ). Indeed, in its order in this case, the Board noted that the DOJ was “the agency responsible for the enforcement of” sec tion 302, and had “issued an influential opinion in 1948 construing the term ‘me mbership dues’ in” section 302(c)(4). NLRB Op. at 6. Further, the Board defe rred to the DOJ’s interpretation of section 302 in reaching its decis ion in this case. 1 Nor are we obligated to defer to the DOJ’s interpre tation of section 302(c)(4). See Crandon v. United States , 494 U.S. 152, 177 (1990) (Scalia, J., concurring) (“[W]e have never thought that the inte rpretation of those charged-2-

with prosecuting criminal statutes is entitled to d eference.”). That leaves us to interpret section 302(c)(4) de novo, applying the applicable rules of statutory construction. I agree with the majority that the term “membership dues,” as used in section 302(c)(4), is ambiguous. Given that conclu sion, I would look to the legislative history of section 302 for guidance. S ee generallyGarcia v. United
States , 469 U.S. 70, 76 n.3 (1984) (noting that “‘[r]esort to legislative history’” is warranted “‘where the face of the [statute] is ines capably ambiguous’”) (quoting Schwegmann Bros. v. Calvert Distillers Corp. , 341 U.S. 384, 395-96 (1951)). Senator Taft, one of the authors of section 302, explained that the general prohibition set forth in section 302(a) was intende d to apply to “a case of extortion or a case where the union representative is shaking down the employer.” 93 Cong. Rec. 4746 (1947). As for the exception se t forth in section 302(c)(4), Taft explained that it “simply prohibit[s] a check- off made without any consent whatever by the employees.” Id. In light of these statements, it appears that a broad construction of the section 302(c)(4) excepti on is warranted. In addition, the rule of lenity arguably comes into play here since we are dealing with an ambiguous term in a criminal statut e. See Staples v. United
States , 511 U.S. 600, 619 n.17 (1994) (noting rule of len ity requires that “ambiguous criminal statute[s] . . . be construed i n favor of the accused”). Under-3-

the rule of lenity, the exception set forth in sect ion 302(c)(4) should be construed broadly to eliminate possible bases of criminal lia bility that do not violate the intent and purpose of the statute. For these reasons, as well as those outlined in the majority opinion, I conclude the most reasonable construction of the te rm “membership dues” is the broad one long utilized by the Board and the DOJ. Under that construction, it is permissible for respondent to deduct “permit fees” from the wages of probationary employees and forward them to the Unio n if the probationary employees have authorized the procedure. As noted by the Board in its decision, the “permit fee” falls within the broad constructio n of the term “membership dues” because it (a) is “equal in amount to the mon thly dues the Union charges its members,” (b) resembles an initiation fee “because it represents an amount the [probationary] employee must pay the Union prior to becoming a member,” and (c) “can reasonably be viewed as a charge to financ e the cost of [the Union] representing the probationary employees, just as th e Union charges dues to finance the cost of representing the regular employ ees.” NLRB Order at 7.01-9516 - NLRB v. Oklahoma Fixture Company

HARTZ , Circuit Judge, concurring:
I concur in the opinion on the understanding that t he permit fee was mandatory (although the fee could be checked off on ly with the employee’s consent). This was the NLRB’s view; its opinion be low stated:

1. “The Union has established a ‘permit fee’ to be paid by new employees in the ‘inside’ unit during the second an d third months of their employment.” 331 NLRB 1116, 1120. 2. “[T]he permit fee resembles [an initiation] fee because it represents an amount the employee must paythe Union prior to becoming a member.” Id . at 1122 (emphasis added).1 The permit fees are not required by the collectiv e bargaining agreement

(“CBA”), but the NLRB determined that the employer’ s past practice of deducting the permit fees became an implied term of the CBA a nd that the probationary employees voluntarily executed authorizations for d eductions of amounts equal to union dues. Oklahoma Fixture Co. , 331 NLRB 1116, 1120-21 (2000). In discussing why the permit fee resembled an initiati on fee, the NLRB relied upon a prior case involving a document given to new employ ees describing the Union’s “dues and permit structure.” Id. at 1122 n.29 (quoting Oklahoma Fixture Co. , 305 NLRB 1077, 1078 (1992)). We usually decide cases b ased upon the record, not upon the record in some other case, although we hav e held that evidence outside the record may be considered in an unfair labor pra ctice proceeding. Beth Israel Hosp. & Geriatric Ctr. v. NLRB , 688 F.2d 697, 699 (10th Cir. 1982) (en banc). This record lacks definitive evidence as to the sou rce of authority for imposing the permit fees, as well as their mandatory charact er. No. 01-9516, National Labor Relations Board v. Okla homa Fixture Co.
KELLY , Circuit Judge, dissenting.
No one, not the National Labor Relations Board (“Bo ard”), not the parties and not even the court, posits that the “permit fee s” in this case are membership dues. Counsel for the Board candidly admitted at o ral argument that this was a first, particularly when the source of the authority for these fees is not contained in the record. 1 The court concludes that “membership dues” is amb iguous because “agency fees” have been included within the term, as well as initiation fees and other union assessments. Finding ambiguity, the court defers to the NLRB interpretation as reasonable, in no small partbecause that interpretation enhances union security, a conclusion that is unadd ressed by the record but in any event could not override the statute. As the court s are charged with administering criminal statutes, not the Board, Chevrondeference seems inappropriate. See-2-

Chevron U.S.A. Inc. v. Natural Res. Def. Council, I nc. , 467 U.S. 837, 842, 844 (1984) (deference appropriate to “an executive depa rtment’s construction of a statutory scheme it is entrusted to administer”); C randon v. United States , 494 U.S. 152, 177 (1990) (Scalia, J., concurring in th e judgment) (Chevrondeference is inapplicable to criminal statutes because those statutes are enforced by courts); Seneca-Cayuga Tribe of Okla. v. Nat’l Indian Gaming Comm’n , 327 F.3d 1019, ____ (10th Cir. 2003) (“Because the Johnson Act is a federal criminal statute enforced by the United States Department of Justice , we owe no deference to the NIGC’s construction.”); United States v. McGoff , 831 F.2d 1071, 1080 n.17 (D.C. Cir. 1987). Even were some degree of deference app ropriate as suggested by the court, no deference should be accorded an interpret ation of the statute that disconnects the term “membership dues” from union m embership or its practical equivalent. The Board’s interpretation is flawed b ecause it fails to distinguish between cases involving employer payments of assess ments against current union members (permissible) and payments of assessments a gainst non-union members (impermissible). In NLRB v. General Motors Corp. , 373 U.S. 734 (1963), the Supreme Court determined that union membership may be a condition of employment only when “whittled down to its financial core,” and so under stood, agency fees are “the practical equivalent” of union membership. Id. at 742-43. Unlike agency fees,2 The court faults the panel opinion for consulting the CBA in determining

that permit fees are not membership dues. As the c ourt observes, however, the purpose of a given payment is particularly instruct ive in determining whether such payment falls within the ambit of “membership dues” under § 302(c)(4). Maj. Op. § IV. The CBA is a reasonable source to which to look for the purpose of the permit fees. We do, after all, apply statutes to f acts, and the CBA provides a factual foundation for the Union’s purpose, or lackthereof, in collecting the permit fees. The lack of any discernible purpose i s exactly what led the Board to use such expressions as “resembles,” and “similar t o” in attempting to locate a post hoc justification for the permit fees. -3- the permit fees in this case are not reflective of the type of “membership” that consists of having the present ability to join the union, but merely paying one’s union dues and assessments. See Marquez v. Screen Actors Guild, Inc. , 525 U.S. 33, 37 (1998) (noting the term “membership” for purposes of § 8(a)(3) is satisfied “merely by paying to the union an amount equal to t he union’s initiation fees and dues”). The CBA makes it clear that the core finan cial obligation of union membership does not arise for probationary employee s until the 91st day of employment. 2 The permit fees in this case simply are not agency fees, initiation fees, service fees or assessments, or the practical equiv alent. The probationary employees are not union members under the CBA, and there is no provision in the CBA for an agency fee; after all, we are dealing wi th a union shop. The probationary employees are excluded from certain be nefits of union membership, including seniority status, resort to grievance pro cedures and paid holidays.-4-

When they become union members, they still are requ ired to pay an initiation fee. They have not consented to the withholding of anyth ing akin to union dues; instead, desirous of employment, they are compelled to have the employer remit permit fees to the union prior to union membership. The fact that such payments may enhance union security (a test that would evisc erate any prohibition on payments by the employer to the union) has never be en held to override at least some connection between “membership dues” and unionmembership. With the exception of membership dues withheld purs uant to a written assignment, Congress generally has made it unlawful for any employer to pay any money to any labor organization. 29 U.S.C. § 186(a ), (c)(4). Though the statute does not define “membership dues,” the term has thu s far, and ought to be, construed “as connoting a payment related to member ship of some kind .” NLRB v. Okla. Fixture Co. , 295 F.3d 1143, 1146 (10th Cir. 2002). Congress c ould amend the Labor Management Relations Act to sever t his link, but it has not done so. That must be the source of any change, for “[w ]e do not sit as a ‘superlegislature’ to second-guess these policy cho ices.” Ewing v. California , – U.S. – , 123 S.Ct. 1179, 1189 (2003). For these re asons, and those contained in the panel opinion, Okla. Fixture Co. , 295 F.3d at 1144-47, I respectfully dissent.