Opinion ID: 780954
Heading Depth: 2
Heading Rank: 3

Heading: The Construction Industry Proviso of Section 8(e)

Text: 29 The Petitioners place most, if not all, of their emphasis on the contention that their agreement is not in violation of the Act because it receives the protection of the construction industry proviso to Section 8(e). The proviso states: 30 [N]othing in this subsection shall apply to an agreement between a labor organization and an employer in the construction industry relating to the contracting or subcontracting of work to be done at the site of the construction, alteration, painting, or repair of a building, structure or other work. 31 29 U.S.C. § 158(e). There is a dearth of applicable case law that could help interpret the meaning and scope of the proviso. 32 There are three phrases in the proviso to be considered in this case: The protected agreement must be between a union and (1) an employer in the construction industry; (2) it must relate to work to be done at the site; (3) of the construction, alteration, painting, or repair of building, structure or other work. As to (1) above, the ALJ held that SMG was not an employer in the construction industry, Decision & Order at 10, but the Board, having found that § 8(e) was violated on another basis, did not decide that issue or the subsidiary question whether it possessed relevant control over labor relations. 33 The Petitioners argue that the Board could not reach the construction site issue without first deciding whether SMG was an employer in the construction industry because SMG's counsel explained at oral argument that the employer in the construction industry comes first in the statutory language. Tr. of Oral Argument, Oct. 29, 2002, at 21. We decline to pursue a chicken or the egg first argument. The construction industry proviso is inapplicable if either the employer is not in the construction industry or the site is not a construction site. The ALJ decided both adversely to the Petitioners. The Board chose to limit its focus on the construction site. It was free to do so. 34 Instead, the ALJ found, and the Board agreed, that trade show floors do not constitute construction sites. In challenging this conclusion, the Union focuses on the ALJ's statement that some work of skilled carpenters is needed and performed at the Convention Center, although the amount remains in question. The ALJ further stated that [t]he work at trade shows requires the same sorts of skills, utilizes the same sorts of materials, and involves the same sorts of tools as traditional, recognized construction work. It is the kind of work, with the kind of skills, that, if performed at a construction project and as a component of that construction, might be exempt under the proviso. Decision & Order at 8. 35 Other similarities, noted by the ALJ and emphasized by Petitioners, are that the assignment process is through a hiring hall, the majority of jobs are of short duration, and carpenters who work trade shows are employed by a number of employers. Id. at 8-9. The ALJ noted that there are normally at least two groups of employees working at the Center to set up and break down trade shows, employees represented by the Painters [with whom AES had a contract] and the Carpenters [the Union with which SMG made the agreement]. Id. at 9. 36 Despite the similarities between some trade show work and traditional construction work, the ALJ focused on the requirement in the proviso that the agreement must apply only to work `to be done at the site.' Id. The ALJ stated: The Center would not be referred to as a construction project, in the sense that appears in the legislative history or in the Supreme Court's decision in Woelke & Romero Framing. No occupancy inspections occur and neither construction nor zoning permits are required. Hard hats are not worn, and safety boots are not required. Id. (footnote omitted). The ALJ summarized his discussion by stating that the Center is an exhibition hall typically used to display items for sale. The Center is not the subject of construction or building. Id. 37 Having found that a trade show floor did not qualify as a construction site, the ALJ determined that the agreement did not fit within the proviso. Id. (whatever work is performed by the Carpenters on the floor of the Center is not being performed at `the site of the construction.'). The Board expressly approved, as it too stated that the work covered by the agreement was not performed on a construction site. Id. at 1. The Petitioners argue that the statutory words at the site do not exclude remote job sites. However, in Woelke & Romero Framing, Inc. v. NLRB, 456 U.S. 645, 654-62, 102 S.Ct. 2071, 72 L.Ed.2d 398 (1982), the Supreme Court speaks of the proviso only in terms of a construction site, and there is no basis to extend site beyond the statutory context of the phrase. 38 Most of Petitioners' fire is reserved for the interpretation applied to the third, and inextricably related, requirement, that the site be of the construction, alteration, painting, or repair of a building, structure or other work. The word construction was interpreted by the Board for purposes of § 8(f) of the Act (the provision allowing pre-hire agreements under certain circumstances) in its decision in Carpet, Linoleum and Soft Tile Local Union No. 1247, 156 NLRB 951 (1966) ( Indio Paint ). In that decision, the Board carefully parsed technical, common, and legal definitions of the word construction as found in Construction Review (a 1957 joint publication of the U.S. Departments of Labor and Commerce), the Standard Industrial Classification Manual, and Mechanics Lien Law respectively. Amalgamating the various definitions, the Board defined building and construction as the provision of labor whereby materials and constituent parts may be combined on the building site to form, make or build a structure. Id. at 959. Using this definition, the Board held that the provision of labor and materials for floor covering installations constitutes building and construction work. Id. The Indio Paint definition is significant because the parties agree that the Board uses the same standard for construction in §§ 8(e) and (f) cases. 39 Upon examining the proviso's legislative history, the Supreme Court determined that Congress wished to `preserve the status quo' regarding agreements between unions and contractors in the construction industry. Woelke & Romero Framing, 456 U.S. at 657, 102 S.Ct. 2071 (quoting National Woodwork, 386 U.S. at 637, 87 S.Ct. 1250). According to the Board, that preservation applies to the status quo in the industry as of 1959, the year Congress enacted § 8(e). Alessio Construction, 310 NLRB 1023, 1027 (1993). For this reason, there is a historical basis for the focus by the General Counsel of the Board on permanency, as the Departments of Labor and Commerce's 1957 Construction Review defines buildings or structures for construction purposes as work built into or affixed to the land. Br. of Bd. at 32. 40 In his brief for the Board, the General Counsel argues that structure is the critical word in the Board's standard enunciated in Indio Paint and that such structure excludes trade show exhibits. Br. of Bd. at 27. He notes that the Board has never treated as a construction site a location where the work provided did not involve building or affixing to the land. 4 Trade show exhibits, certainly the ones in question, are not built into or affixed to the land; the only building associated with this dispute is the Convention Center. Thus, the Board's brief argues that because the Center is not being constructed or altered, it is not a construction site. 41 In an analysis that Petitioners vigorously attack, the ALJ distinguished the earlier Board decisions that held that the construction of a retail store fell within § 8(e)'s proviso on the ground that the employer in those cases was involved in the construction of a building, something tangible and permanent, even installing carpeting. Decision & Order at 8. The Petitioners complain that in interpreting the language of the proviso to require some permanence to the structure, the ALJ and the Board have added a requirement Congress never intended. We do not agree. The contemporary references cited by the ALJ define construction in terms of structures being built into or affixed to the land, which necessarily excludes temporary trade show work. Decision & Order at 9. 42 The Petitioners suggest that there is no statutory basis for the Board's requirement for a structure. They criticize the Board for ignoring the words other work in the proviso while focusing on site of construction. Br. of Union at 39. However, the Petitioners provide no decisions in which the Board or any court discusses other work. In such a situation, the General Counsel is not unreasonable in referring to the maxim that a word is known by the company it keeps. Br. of Bd. at 31. 43 The Union supports its position by reference to what some courts have deemed to be the legislative intent behind the proviso, which is minimizing jobsite tension within the construction industry. Br. of Union at 37 (citing Milwaukee & Southeast Wis. Dist. Council of Carpenters v. Rowley-Schlimgen, 2 F.3d 765, 767 (7th Cir.1993)). The Union then states that because having different groups at the Center causes friction, it would be arbitrary not to conclude that the Convention Center is a requisite location for application of the proviso. Br. of Union at 38. However, as the Supreme Court said in Woelke & Romero Framing, the proviso was only partly concerned with jobsite friction. 456 U.S. at 662, 102 S.Ct. 2071. Instead, the Woelke Court found that Congress was more concerned with preserving the status quo in the construction industry. Id. at 657, 102 S.Ct. 2071. The Board has concluded that under established principles of statutory construction, the construction industry proviso should not be given an expansive reading but should protect only `those subjects expressly exempted by the proviso.' Local 520 Operating Engineers (Massman Construction), 327 NLRB 1257, 1257-58 (1999) (quoting Alessio Construction, 310 NLRB 1023, 1029 (1993)). The Board's interpretation of the proviso as limited to more traditional notions of construction appears to be consistent with that principle and Congress' purpose. 44 We are presented with two vastly different interpretations of the construction industry proviso. Under the ALJ's and Board's interpretation of the proviso, the proviso covers, and is limited to, traditional construction sites, such as building homes, offices, and similar relatively permanent structures. Under the interpretation of construction site proffered by the Petitioners, any location where installing, assembling and disassembling occurs feasibly could fit within the construction industry proviso, ranging from construction of intricate movie sets to platforms at malls for performers and the appearance of Santa Claus. Petitioners have produced no evidence that Congress envisioned that movie set builders and the like would fall within the construction industry proviso. 45 Under the circumstances, where the United States Supreme Court, this court, and no other federal appellate court has addressed the issue of the application of the construction industry proviso to the installing and dismantling of trade show exhibits, we believe it is appropriate to defer to the reasonable statutory interpretation of the Board, the agency primarily charged with the Act's implementation and administration. See Meyer v. Holley, 123 S.Ct. 824, No. 01-1120, slip op. at 7 (U.S. Jan. 22, 2003); Chevron U.S.A. Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837, 842-45, 104 S.Ct. 2778, 81 L.Ed.2d 694 (1984). 5 We will therefore deny the Petition for Review and grant the Board's cross-application for enforcement.