Opinion ID: 185278
Heading Depth: 2
Heading Rank: 1

Heading: The Profit-Sharing Plan Exclusion

Text: Atlas Air's claim and the district court's judgment arebased on the proposition that the Railway Labor Act imposesno obligation upon carriers to maintain status quo wages,rules or working conditions after the certification of a unionbut before the onset of collective bargaining. RLA Section 2,Seventh, for instance, provides: No carrier, its officers or agents shall change the rates of pay, rules, or working conditions of its employees, as a class as embodied in agreements except in the manner prescribed in such agreements or in section 156 of this title. 45 U.S.C. s 152, Seventh. RLA Section 6 requires thatemployers and employee representatives shall give at leastthirty days' written notice of an intended change in agreements affecting rates of pay, rules, or working conditions.... Id. s 156. By their express terms, these so-called status quo provisions of the Act only prohibit unilateral changes in wages orworking conditions where there is a preexisting collectivebargaining agreement. See Williams v. Jacksonville Terminal Co., 315 U.S. 386, 402-03 (1942) (The prohibitions of s 6against change of wages or conditions pending bargaining andthose of s 2, Seventh, are aimed at preventing changes inconditions previously fixed by collective bargaining agreements.); Detroit & Toledo Shore Line R.R. Co. v. UnitedTransp. Union, 396 U.S. 142, 158 (1969) (status quo changesin working conditions prior to collective bargaining are permissible where there is absolutely no prior history of anycollective bargaining or agreement between the parties onany matter). As this Court recognized in InternationalAss'n of Machinists & Aerospace Workers, AFL-CIO v.Trans World Airlines, no power to enjoin unilateral changesin working conditions by management flows from Section 6 ofthe Act in the absence of pre-existing, in place, collective bargaining agreements. 839 F.2d 809, 814 (D.C. Cir. 1988).1 Other circuits have reached the same conclusion. See Aircraft Mechanics Fraternal Ass'n v. Atlantic Coast Airlines,Inc., 55 F.3d 90, 93 (2d Cir. 1995) (The RLA simply do[es]not impose an obligation on the carrier to maintain the statusquo in the absence of an agreement.); Regional AirlinePilots Ass'n v. Wings West Airlines, Inc., 915 F.2d 1399, 1402(9th Cir. 1990). Cf. International Ass'n of Machinists andAerospace Workers v. Transportes Aereos Mercantiles PanAmericandos, S.A., 924 F.2d 1005, 1007 (11th Cir. 1991) (RLAprecludes status quo changes once collective bargaining hasbegun). But cf. Aircraft Mechanics Fraternal Ass'n v. Atlantic Coast Airlines, Inc., 55 F.3d 90, 92 (2nd Cir. 1995) (Thequestion presented in this lawsuit is whether [certain unilateral changes in conditions of employment] are allowed afterbargaining has commenced ... but before an agreement isreached. We answer the question in the affirmative.). On the basis of these decisions the district court belowruled that the Railway Labor Act imposes no duty to maintain the status quo in a case such as this where a union hasbeen certified, but collective bargaining negotiations have notcommenced and there is no prior agreement between theparties. Atlas, 69 F. Supp. 2d at 164. This is no doubt true. Section 2, Seventh and Section 6 do not require carriers tomaintain status quo working conditions. But, the lack of astatus quo obligation under the RLA does not mean that anychange in the status quo is per se legal. A carrier's actionmay violate other rights or obligations fixed by the RLA.
The lack of an enumerated obligation to maintain the statusquo pending the negotiation of a collective bargaining agreement does not absolve an employer from its obligation torefrain from activities which undermine employees' rights. __________ 1 Other courts have evidenced much less willingness to reviewclaims under ss 152, Third and Fourth in the post-certificationcontext. See, e.g., Wightman v. Springfield Terminal Railway Co.,100 F.3d 228, 235 (1st Cir. 1996). The RLA bars employers from engaging in discriminatoryactions designed to impede or inhibit employees' exercise oftheir right to organize for collective bargaining purposes. For this reason, the real question in this case is whether... the carrier has discriminated against its employees because they have engaged in activities protected by theRLA.... Railway Labor Executives' Ass'n v. Boston &Maine Corp., 808 F.2d 150, 157 (1st Cir. 1986). Section 1a(2) of the Act forbid[s] any limitation uponfreedom of association among employees or any denial, as acondition of employment or otherwise, of the rights of employees to join a labor organization. 45 U.S.C. s 151a(2). Section 2 of the RLA fleshes out this protection. Section 2,Third provides that employees may select their representatives without interference, influence, or coercion of anykind. Id. s 152, Third. Section 2, Fourth further providesthat: No carrier, its officers or agents, shall deny or in any way question the right of its employees to join, organize, or assist in organizing the labor organization of their choice, and it shall be unlawful for any carrier to interfere in any way with the organization of its employees ... or to influence or coerce employees in an effort to induce them to join or remain or not to join or remain members of any labor organization.... Id. s 152, Fourth. These provisions prohibit employersfrom interfering with, coercing or influencing the representational choices of workers and from interfering with the rightof employees to organize in labor unions. ALPA v. EasternAir Lines, Inc., 863 F.2d 891, 893 (D.C. Cir. 1988). In Eastern, the carrier sought to modify its flight scheduleand furlough over 3,000 employees, the majority of whomwere represented by ALPA or other unions. Eastern AirLines was in substantial financial difficulty at the time, andthe changes would reduce its monthly payroll expenses bynearly $7 million. See id. at 893. The unions challenged thisplan alleging, among other things, that it violated Section 2,Third and Fourth of the RLA. We rejected ALPA's claims because the carrier had legitimate business motivations independent of any effort to discourage employees from exercising their rights under the RLA, stating that [w]orkers'Railway Labor Act rights to unionize are adequately protected so long as management is limited to taking only measuresthat it would have taken in the absence of any anti-unionanimus. Id. at 902. ALPA argues that Eastern is distinguishable from thepresent case because the challenged policy did not impose adifferential impact on union members. Id. at 903. Atlas canmake no such claim about the profit-sharing plan eligibilityrequirements or its decision to terminate plan participationfor flight crewmembers. In addition, ALPA contends, Eastern reaffirms precedent from other circuits that employerscannot make changes in status quo working conditions thatare anti-union in motivation or effect. ALPA argues there is a class of anti-union acts that are'inherently destructive' of important employee interests, sothat 'no proof of anti-union motivation is needed.'  Eastern,863 F.3d at 902 (quoting NLRB v. Great Dane Trailers, Inc.,388 U.S. 26, 34 (1967)). Following the Supreme Court'steaching in Great Dane, the Sixth Circuit found an exclusionary eligibility requirement for a voluntary retirement savingsand profit-sharing plan to be inherently destructive ofemployee rights and per se unlawful under the NationalLabor Relations Act (NLRA). Kroger Co. v. NLRB, 401 F.2d682, 686-89 (6th Cir. 1968). The Sixth Circuit held that thepolicy would naturally have some deterring effect on unionmembership. Id. at 686. As a result, the policy was deemedfacially invalid; the court required no showing of anti-unionanimus. Other courts have reached similar conclusions underthe NLRA. See, e.g., AMF Bowling Co. v. NLRB, 977 F.2d141, 145 (4th Cir. 1992) (termination of a severance-pay planupon an employee becoming a member of a bargaining unitviolates the NLRA); Melville Confections, Inc. v. NLRB, 327F.2d 689, 691-92 (7th Cir. 1964) (exclusion of unionrepresented employees from profit-sharing plan is per seviolation of the NLRA). The National Labor Relations Boardalso follows this interpretation. See, e.g., E & L Plastics Corp., 305 N.L.R.B. 1119, 1119-20 (1992); AMF Bowling Co.,303 N.L.R.B. 167, 170 (1991), enforced in relevant part, 977F.2d 141, 145 (4th Cir. 1992); Niagara Wires, Inc., 240N.L.R.B. 1326, 1327-28 (1979). In Eastern we did not hold the carrier's actions to beinherently destructive because there was no claim that thepolicy impose[d] a differential impact on union members. Eastern, 863 F.2d at 903. The vast majority of acts found'inherently destructive'  have been those, like the actions ofAtlas Air, that discriminate solely on the basis of unionmembership. Id. at 902; see, e.g., NLRB v. FleetwoodTrailer Co., 389 U.S. 375 (1967) (unjustified failure to reinstate ex-strikers held unlawful without reference to employer's intent); NLRB v. Erie Resistor Corp., 373 U.S. 221(1963) (grant of superseniority to strike replacements andworkers coming off the strike held inherently destructive); C.H. Heist Corp. v. NLRB, 657 F.2d 178 (7th Cir. 1981)(disparate treatment of union officials held to be inherentlydestructive); Kroger, 401 F.2d at 602 (action denying unionmembers access to profit-sharing plan held unlawful withoutshowing of anti-union animus). As we noted above, the inherently destructive precedentsall arose under the NLRA, not the RLA. While the two lawsare not equivalent, we have interpreted the respective provisions barring undue employer influence of employees asmeaning pretty much the same thing. US Airways, Inc. v.NMB, 177 F.3d 985, 991 (D.C. Cir. 1999). Despite thestatutory differences, carefully drawn analogies from thefederal common labor law developed under the NLRA may behelpful in deciding cases under the RLA. Trans WorldAirlines, Inc. v. Independent Fed'n of Flight Attendants, 489U.S. 426, 432 (1989); see id. at 432-34 (applying NLRAprecedents to interpret RLA Section 2, Fourth). While ofcourse NLRA precedents may not be casually transferred tothe RLA context given the severe impact of Atlas Air'sactions on its newly unionized employees we see no reasonwhy the latter requires us to cast a more jaundiced eye onefforts to exert economic pressure than the former. Eastern, 863 F.2d at 909. Atlas Air adopted a facially discriminatory policy thatpenalized employees by terminating their participation inprofit sharing for no other reason than their decision tounionize. Prior to the election of ALPA as the crewmembers'bargaining representative, Atlas repeatedly threatened itsemployees with a substantial decrease in compensation thatwould have a real and material impact on the conditions ofemployment. In case there was any confusion about themagnitude of the loss that would result upon certification of aunion, Atlas distributed documents detailing the amount ofincome at stake. Then, upon learning of ALPA's election,Atlas immediately fulfilled its threat and terminated theprofit-sharing plan before the results had even been certified. It is difficult to view these actions as anything other than thesort of interference, influence, or coercion explicitly barredby the RLA. In reaching this conclusion we need not decide whetherthere is a broad class of inherently destructive acts that areper se illegal under the RLA. That is, even without importing NLRA precedent with full force into the RLA context, wefind instructive the concept that the very nature of actionsagainst unionized labor by an employer can in and of itselfprovide evidence of the animus generating those acts. Whilewe continue to recognize that the employer may alter statusquo working conditions, so long as no collective bargainingagreement exists between the parties, where the challengedmodification to the status quo is far from merely formal, andis in fact the equivalent of a substantial decrease in compensation having a real and material impact on the conditions ofemployment, and is justified on no other grounds than unioncertification, we may presume that the carrier's actions weremotivated by anti-union animus and are in violation of RLASection 2, Third and Fourth. To hold otherwise would allowa carrier, without legal consequence, to slash to subsistencelevels the wages of those employees who elect to unionize. Were we to allow such a result, the RLA provisions prohibit[ing] employers from interfering with, coercing or influencing the representational choices of workers and from interfering with the right of employees to organize in labor unions would no longer be effective. Eastern, 863 F.2d at 893. While carriers retain the right to make unilateral changes instatus quo working conditions, so long as there is no collectivebargaining agreement, they may not make such changeswhich selectively penalize unionized employees so as to interfere with, coerce, or influence their decision to exercise theirrights under the RLA.
Atlas posits that ALPA's claim under the RLA is timebarred and that this provides an alternative ground uponwhich to uphold the district court's grant of summary judgment. The statute of limitations for the RLA, borrowed fromsection 10(b) of the National Labor Relations Act, 29 U.S.C.s 160(b), is six months. See West v. Conrail, 481 U.S. 35(1987). According to Atlas, ALPA's claim accrued eitherupon the initial imposition of the profit-sharing plan, or nolater than January 1998 when ALPA lost its initial representative election. In either case, ALPA's claim would be timebarred. A claim normally accrues when the factual and legalprerequisites for filing a suit are in place. 3M Co. v.Browner, 17 F.3d 1453, 1460 (D.C. Cir. 1994). Were ALPA'sclaim solely based upon the actions taken by Atlas prior tothe 1999 certification election, it would be time-barred. However, under the NLRA, from which the RLA borrows itsstatute of limitations, the maintenance of exclusionary clauses in employee benefit plans has been held to constitute aviolation. See, e.g., Kroger Co., 164 N.L.R.B. 362, 363, 376(1967), enforced in relevant part, 401 F.2d 682 (6th Cir. 1968); Melville Confections, Inc., 142 N.L.R.B. 1334, 1339 (1963),enforced, 327 F.2d 689, 690 (7th Cir. 1964) (The Board foundthat the company violated Section 8(a)(1) of the Act bymaintaining and continuing to maintain a profit-sharingplan ... which required as a condition precedent to participation ... that the employee not be represented by a labororganization for the purposes of collective bargaining. (emphasis added and footnote omitted)); id. at 692 (Nor doesthe fact that the company's violation antedated the Section 10(b) period applicable to the instant charge preclude afinding of a violation which occurred through a continuation ofthe proscribed conduct during and within the six-month period prior to the filing of the charge.). Thus, Atlas Air'scontinued reliance upon its exclusionary eligibility policy, andrepeated threats to enforce this policy should the crewmembers exercise their right to unionize, constitutes a continuingviolation under the applicable case law. Therefore, ALPA's claims are still clearly alive. As theSupreme Court noted interpreting section 10(b) of theNLRA: [W]here occurrences within the six-month limitations period in and of themselves may constitute, as a substantive matter, unfair labor practices.... earlier events may be utilized to shed light on the true character of matters occurring within the limitations period.... Local Lodge No. 1424 v. NLRB, 362 U.S. 411, 416 (1960); seealso id. at 416-17 (distinguishing the above from cases inwhich conduct occurring within the limitations period can becharged to be an unfair labor practice only through relianceon an earlier unfair labor practice); International Union,United Auto., Aerospace and Agric. Implement Workers ofAm. v. NLRB, 363 F.2d 702, 706-07 (D.C. Cir. 1966) (claimnot time-barred where unfair labor practice started morethan six months prior to the charge was carried forward bymore recent actions). In the case at bar, Atlas committedviolations within the limitations period by, among otherthings, repeatedly threatening to terminate profit sharing foremployees that elect to unionize and its immediate severanceof represented unit members from the profit-sharing planupon learning that ALPA won the election. Under LocalLodge No. 1424, this is sufficient to prevent ALPA's claimsfrom being time-barred.