Opinion ID: 3175253
Heading Depth: 2
Heading Rank: 3

Heading: The Board’s Failure to Assess the Confidential

Text: Settlement Agreement and its Incorporation of the 2006 Master Agreement As previously explained, Raymond and the Carpenters executed a Confidential Settlement Agreement on September 12, 2006, providing that, upon expiration of the Painters Agreement, Raymond would apply the 2006 Master Agreement to Raymond’s drywall-finishing employees “to the fullest extent permitted by law.” The Confidential Settlement Agreement took effect on October 1, 2006. The ALJ found that Raymond and the Carpenters had violated Section 8(a)(1) and (3) and Section 8(b)(2) of the Act, respectively, when they applied the 2006 Master Agreement to the drywallfinishing employees on October 1, and had violated Section 8(a)(2) and Section 8(b)(1)(A) of the Act, respectively, when Raymond recognized the Carpenters as the employees’ bargaining representative on that day. The Board declined to address the legality of the 2006 Master Agreement as of October 1 because that agreement was the same agreement that was unlawfully enforced on October 2. The Board thus ordered Raymond and the Carpenters to, inter alia, cease and desist from applying the 2006 Master Agreement to the drywall-finishing employees unless and until the Carpenters were certified by the Board. 20 In a motion for reconsideration submitted to the Board, Raymond, joined by the Carpenters, argued: The Board’s Order is unwarranted if Raymond had a pre-existing 8(f) agreement at the time of the alleged Section 8(a)(2) violations found by the ALJ and adopted by the Board. Extant Board precedent under Zidell Exploration[s], Inc., 175 NLRB 887 (1969) holds that a pre-existing 8(f) agreement is not invalidated by subsequent acts of unlawful assistance. Motion for Reconsideration, reprinted in Joint Appendix 24. In rejecting this claim, the Board said: Raymond also argues that the Board erred in failing to decide whether the “Confidential Settlement Agreement” (CSA) reached between Raymond and the Carpenters 3 weeks before the unlawful assistance constituted a valid 8(f) agreement that was not invalidated by Raymond’s subsequent acts of unlawful assistance. We deny this aspect of the motion, because a finding that the [Confidential Settlement Agreement] constituted a valid 8(f) agreement would not affect our determination that Raymond, on October 2, 2006, unlawfully recognized the Carpenters as the 9(a) representative of its drywall finishing employees. Raymond, 357 N.L.R.B. No. 166, at 2. The Board’s decision is hard to fathom. As the Board noted, Raymond and the Carpenters contended that the Confidential Settlement Agreement and its incorporation of the 2006 Master Agreement on October 1 resulted in a lawful 8(f) agreement covering the drywall-finishing employees on 21 that date. They further contended that the unfair labor practices that were allegedly committed on October 2 could not have vitiated the lawful 8(f) agreement that was effective on October 1. In other words, Raymond and the Carpenters claim that even if their attempt to execute a 9(a) agreement on October 2 failed, this could not have nullified the preexisting 8(f) agreement. We agree that the Board erred in failing to address this issue. There is a long-standing principle that, as a general matter, when a collective bargaining agreement is not a byproduct of unfair labor practices and does not otherwise hinder the policies of the Act, “the Board [is] without authority to require [the parties] to desist from giving effect to the [agreement].” Consol. Edison Co. v. NLRB, 305 U.S. 197, 236-38 (1938); see also NLRB v. Reliance Steel Prods. Co., 322 F.2d 49, 56 (5th Cir. 1963); NLRB v. Kiekhaefer Corp., 292 F.2d 130, 135-37 (7th Cir. 1961); NLRB v. Scullin Steel Co., 161 F.2d 143, 147-48 (8th Cir. 1947). Indeed, the Board applied this principle in Zidell Explorations, Inc., 175 N.L.R.B. 887 (1969), the decision cited by Raymond in its Motion for Reconsideration. In Zidell, after executing lawful 8(f) agreements with a union, the employers involved in that case engaged in unfair labor practices. The ALJ concluded that the 8(f) agreements were “rendered unlawful nunc pro tunc by reason of the postcontract employer unfair labor practices.” Id. at 887-88. The Board rejected this conclusion and explained: [I]t has long been established by Board and court cases that employer acts of unlawful assistance occurring after the execution of a lawful contract, and during the contract term, do not justify a remedial order suspending 22 recognition of the assisted union during the contract term or directing that the contract be set aside. Id. at 888 (citing Reliance Steel Prods., 322 F.2d 49; Scullin Steel, 161 F.2d 143; Arden Furniture Indus., 164 N.L.R.B. 1163 (1967); M. Eskin & Son, 135 N.L.R.B. 666 (1962), enforced sub nom. Confectionery & Tobacco Drivers & Warehousemen’s Union, Local 805 v. NLRB, 312 F.2d 108 (2d Cir. 1963); and Lykes Bros., Inc., 128 N.L.R.B. 606 (1960)). The Board never addressed this line of authority in its decision in this case. Before this court, Board counsel argued that Zidell is inapposite because it is factually distinguishable. Counsel pointed out that, “[i]n Zidell, unlike here, the ‘employer alone’ was responsible for the unlawful conduct that occurred subsequent to the creation of a Section 8(f) contract.” Br. for Respondent at 49. Thus, according to counsel, Zidell should be limited to situations in which the unlawfully assisted union was not “found to have participated in, had any control over, or even been aware of [the unlawful] conduct.” Id. (alteration in original) (citation omitted). We decline to consider this argument because it is merely a post-hoc rationalization offered by Board counsel, not the Board. The Board never addressed Zidell in denying the Motion for Reconsideration filed by Raymond. Furthermore, even if we were to consider this argument, the authorities cited by Zidell certainly do not endorse the limitation suggested by Board counsel. See Zidell, 175 N.L.R.B. at 888 n.2. In M. Eskin & Son, both the employer and the union committed unfair labor practices after executing a lawful agreement. 135 N.L.R.B. at 666, 670. Nevertheless, the Board there refused to invalidate the preexisting contract, explaining: 23 As all the unfair labor practices . . . occurred during the term of the Respondents’ collective bargaining contract, the execution and maintenance of which are not under attack, we do not believe that an order requiring the parties to suspend their bargaining relationship pending an election is necessary to effectuate the policies of the Act. Accordingly, as there is no basis for a finding that the contract between the parties was a consequence of the unfair labor practices found, or that the contract thwarts any policy of the Act, we reject the [ALJ’s] recommendation for the issuance of a cease-recognition order. Id. at 671 (footnote omitted) (citing Scullin Steel, 161 F.2d at 147); see also Lykes Bros., 128 N.L.R.B. at 609-11 (same). There is nothing in the Zidell decision to indicate that the Board meant to disavow the holdings in M. Eskin & Son or Lykes Brothers, nor is there anything to suggest the Board meant to disregard or limit the principle endorsed in Consolidated Edison Co. and its progeny. If, as they contend, Raymond and the Carpenters executed a lawful 8(f) agreement on October 1, then their subsequent unfair labor practices that were committed when they attempted to execute a 9(a) agreement on October 2 would appear to be irrelevant to the question of whether there was a lawful 8(f) agreement in effect on October 1. Even if, as the Board found, Raymond unlawfully recognized the Carpenters on October 2, 2006, as the 9(a) representative of its drywall-finishing employees, why would this nullify a lawful, pre-existing 8(f) agreement? The Board inexcusably failed to address this issue. We will therefore remand the case for further consideration. 24 D. The Petition for Review Filed by the Painters Union The Painters Union has petitioned for review for the limited purpose of challenging the Board’s sanctions against Raymond and the Carpenters Union. In particular, the Painters Union contends that the Board abused its discretion in declining to require Raymond to provide alternate benefits coverage equivalent to the coverage possessed under the 2006 Master Agreement, choosing instead to allow Raymond to maintain the benefits already in place. See Raymond, 357 N.L.R.B. No. 166, at 1. The Painters Union also contends that the Board erred in not precluding Raymond and the Carpenters from entering an 8(f) agreement in the future. See id. at 1 n.5. In assessing the Painters’ claims, we want to make it clear that nothing in our decision is meant to question the Board’s determination that Raymond and the Carpenters were free to enter into an 8(f) arrangement after October 2. The Board did not err in reaching this conclusion and it need not reconsider this matter on remand. We decline to consider the Painters’ principal claim – i.e., that the Board abused its discretion in declining to require Raymond to provide alternate benefits coverage – because our decision to remand on the remedy issue may render the claim moot. Genesis Healthcare Corp. v. Symczyk, 133 S. Ct. 1523, 1528 (2013) (“If an intervening circumstance deprives the plaintiff of a ‘personal stake in the outcome of the lawsuit,’ at any point during litigation, the action can no longer proceed and must be dismissed as moot.” (quoting Lewis v. Continental Bank Corp., 494 U.S. 472, 477–78 (1990))). If the Board concludes on remand that Raymond and the Carpenters entered into a valid section 8(f) agreement on October 1 that endured despite the subsequent unfair labor 25 practices, the Painters Union can raise no viable challenge to the Board’s decision to allow Raymond to maintain the benefits in place since the entire agreement would remain in place. If the Board finds that Raymond and the Carpenters did not enter into a valid section 8(f) agreement on October 1, then it will be up to the Board in the first instance to determine whether any adjustment in its remedial order is required.