Court Opinion

ID: 2995649
Source: CourtListenerOpinion
Date Created: 2015-09-24 19:21:32.262795+00
Date Added: 2024-06-11T11:34:56.603081
License: Public Domain

In the
United States Court of Appeals
For the Seventh Circuit

No. 01-2887

National Labor Relations Board,

Petitioner,

and

International Union of Elevator Constructors,
AFL-CIO,

Intervening-Petitioner,

v.

River City Elevator Company, Inc.,

Respondent.

On Application for Enforcement of an Order
of the National Labor Relations Board.

Argued April 5, 2002--Decided May 13, 2002

  Before Flaum, Chief Judge, and Posner and
Rovner, Circuit Judges.

  Flaum, Chief Judge. The National Labor
Relations Board ("NLRB") seeks the entry
of an enforcement order requiring River
City Elevator Company, Inc. ("River
City") to bargain with the International
Union of Elevator Constructors ("the
Union"). River City argues that, during
the election to determine whether the
Union would represent River City
employees, it sought to influence the
election outcome by promising employees
certain benefits. For the reasons stated
below, we deny the Board’s application to
enforce its order and reverse any finding
by the Board that River City committed an
unfair labor practice.

I.    BACKGROUND

  In October of 1999, the Union filed a
petition with the NLRB seeking
certification as the collective
bargaining representative of River City’s
elevator mechanics and helpers. On
November 18, 1999, an election was
conducted among seven River City
employees to determine whether they
wished to be represented by the Union.
The results of the secret ballot election
were very close--with four out of seven
employees choosing Union representation.

  On November 24, 1999, River City filed
objections to the election. According to
River City, the Union interfered with
election conditions by promising certain
benefits to the voting employees. An NLRB
hearing officer and subsequently the
Board itself denied River City’s
objections. The Union was then certified
as the bargaining representative for
River City’s employees. Shortly after
this certification, the Union sent River
City a request to enter into collective
bargaining./1 River City refused this
request and, as a result, the Union filed
an unfair labor practice charge against
it for its failure to recognize and
negotiate with the Union. Pursuant to the
Union’s complaint, the General Counsel of
the NLRB filed a motion with the Board
requesting that River City be compelled
to enter into negotiations with the
Union. The NLRB granted that motion. This
appeal, on application for the
enforcement of the order compelling River
City to bargain, has ensued.

  The allegations contained in River
City’s objections to the results of the
Union election also form the gravamen of
its appeal. Specifically, River City
contends that, by offering reductions in
initiation fees and union dues, as well
as by giving River City employees
Mechanic’s cards (when those employees
had not completed the requisite course
work and examinations), the Union
intended to interfere with the laboratory
conditions of the election./2

  During the period leading up to the
election, representatives of the Union
met with River City employees. During
these meetings, Union representatives
informed the employees that, normally,
new members were charged an initiation
fee of $440. However, the Union told the
employees that, because of the organizing
drive, it would reduce the initiation
fees that they would be required to pay
to $50./3 The Union’s offer to reduce
initiation fees and dues was made to all
employees and was not conditioned
uponemployee support for the Union at the
ballot box.
  Representatives from the Union also
offered all of the River City employees
Mechanic’s cards, even though they had
not completed the requisite training
programs./4 The National Elevator
Industry Educational Program (NEIEP) was
established in 1967. Pursuant to
collective bargaining entered into
between the Union and the National
Elevator Industry, the NEIEP prescribes
the course of training individuals must
undertake in order to qualify as a
Mechanic. According to the Union’s
Standard Agreement, no individual "may
qualify or be raised to the Capacity of
Mechanic until he has worked for a period
of three (3) years in the elevator
industry, has successfully completed the
required NEIEP courses, and has passed a
Mechanic’s Examination administered by
the NEIEP Director’s Office." IUEC
Standard Agreement, p. 51. In the period
leading up to the election, the Union
promised River City employees Mechanic’s
cards based upon their experience (as
determined by Union representatives)
regardless of whether they had completed
NEIEP requirements.

II.   DISCUSSION

  Because River City refused to enter into
collective bargaining with the Union, the
issue presented in this appeal is whether
the Board acted reasonably in certifying
the Union as the employees’
representative. If we determine that the
Board’s action was reasonable, the Board
is entitled to the enforcement of its
order compelling River City to enter into
collective bargaining. See National By-
Products, Inc. v. NLRB, 931 F.2d 445, 448
(7th Cir. 1991).

  In reviewing the factual findings of the
NLRB, we examine them to see if there is
substantial evidence in the record as a
whole to support the Board’s conclusions.
Universal Camera Corp. v. NLRB, 340 U.S.
474, 488 (1951); Overnite Transp. Co. v.
NLRB, 104 F.3d 109, 112 (7th Cir. 1997).
When an objecting party disputes the
result of a Board supervised election,
there is a formidable burden upon the
objecting party to prove that it was not
valid. NLRB v. Service American Corp.,
841 F.2d 191, 195 (7th Cir. 1988).
Indeed, the objecting party must
demonstrate that misconduct occurred and
that such misconduct "damaged the
fairness of the election." Clearwater
Transport, Inc. v. NLRB, 133 F.3d 1004,
1010 (7th Cir. 1998). When we examine the
tactics leading up to the election in the
instant case, we find that Union
misconduct occurred "to such an extent
that [it] materially affected the results
of the election." Overnite Transp. Co.,
104 F.3d at 113.

  The seminal case in assessing whether a
Union has improperly furnished benefits
to influence the outcome of an election
is NLRB v. Savair Mfg. Co., 414 U.S. 270
(1973). In Savair, the Supreme Court held
that a union’s offer to waive initiation
fees, conditioned upon employees joining
the union prior to an election, was
improper conduct that allowed the union
to effectively "buy endorsements and
paint a false portrait of employee
support during its election campaign."
Id. at 277. The Court in Savair did not,
however, categorically prohibit unions
from waiving initiation fees. Rather,
Savair has been interpreted to hold that
a union’s waiver of initiation fees is
permissible in an election campaign, when
the waiver is available to all employees
and is not conditioned upon a
demonstration of pre-election support for
the union. See, e.g., NLRB v. WFMT, 997
F.2d 269, 277 (7th Cir. 1993); Deming
Division, Crane Co., 225 N.L.R.B. 657,
659 (1976). Under such circumstances, a
union may waive fees "because employees
otherwise sympathetic to the union might
well have been reluctant to pay out money
before the union had done anything for
them. Waiver of the [fees] would remove
this artificial obstacle to their
endorsement of the union." Savair, 414
U.S. at 273 n.4. (internal citations
omitted).

  A.   Initiation Fees and Union Dues

  In the instant case, we find that the
Union’s offer to reduce initiation fees
and dues for River City employees does
not offend the principles set forth by
Savair. The Union’s offer was extended to
all employees unconditionally "without
distinction between [employees] joining
the union before or after the election."
Deming Division, Crane Co., 225 N.L.R.B.
at 659. Furthermore, the reduction of
union fees and dues operated as a removal
of an artificial obstacle to River City
employees joining the Union, rather than
as an affirmative attempt to influence
voting (e.g., providing cash or in-kind
items to employees during an election
campaign). See, e.g., Owens-Illinois,
Inc., 271 N.L.R.B. 1235 (1984) (union’s
gift of jackets to employees, between
voting sessions on election day, amounted
to objectionable conduct which could have
appeared as a reward or an inducement to
vote for the union).

  B.   Mechanic’s Cards

  We find that, unlike the Union’s
unconditional reduction of initiation
fees and dues, its offer of Mechanic’s
cards to River City employees, when
several (if not all) of those employees
had not completed the requisite courses
or exams, violated the dictates of Savair
and effectively bought employee
endorsements during its election
campaign. 414 U.S. at 277. The Union’s
Standard Agreement is unambiguous. In
order to become a fully qualified
Mechanic (and receive a Mechanic’s Card),
an individual must have "successfully
completed the required NEIEP courses, and
[have] passed a Mechanic’s Examination
administered by the NEIEP Director’s
Office." IUEC Standard Agreement, p. 51.

  While it is difficult to quantify the
value of receiving a Mechanic’s card
without having to attend classes or take
an exam, we ask "[a]re the articles
sufficiently valuable and desirable in
the eyes of the person to whom they are
offered, to have the potential to
influence that person’s vote?" Nestle Ice
Cream Co. v. NLRB, 46 F.3d 578, 583 (6th
Cir. 1995). The NLRB has refused to
certify elections where, during the
course of an election campaign, the
benefit offered to employees appeared to
be of far less value. See, e.g., Owens-
Illinois, Inc., 271 N.L.R.B. 1235, 1236-
37 (gift of union jackets); Wagner Elec.
Corp., 167 N.L.R.B. 532, 533 (1967)
(union’s "gift of life insurance coverage
is a tangible economic benefit and is
most ’unusual’"); Mailing Services, Inc.,
293 N.L.R.B. 565 (1989) (free medical
screenings given by union to employees
during the election campaign found to be
impermissible).
  In this case, the NLRB hearing officer,
whose findings were subsequently adopted
by the Board, determined that no election
violation had occurred because the
benefits the Union extended to River City
employees were not conditioned upon their
support of the Union. This finding fails
to consider the fact that the "gift" in
this case was far different from removing
a barrier to employees joining the Union.
By granting the River City employees the
immediate privileges attendant upon a
Mechanic’s card (i.e., ability to work as
a full Mechanic in practically any IUEC
controlled site), the Union opened up an
entire class of jobs to these
individuals. In this sense, the extension
of Mechanic’s cards, without the
obligation to fulfill training and
examination requirements, moves beyond
the reduction of initiation fees or dues.
River City employees were affirmatively
given access to more lucrative jobs at a
far lesser cost. At the very least, this
gift, in the context of a hotly contested
election campaign, "smacked of a
’purchase’ of votes because the Union[ ]
had no responsibility to provide" these
Mechanic’s cards. Nestle Ice Cream Co.,
46 F.3d at 584. Furthermore, it appears
that River City employees could have
perceived (quite rightly) that "they were
receiving ’something for nothing,’ and
[that] the ’something’ was quite
valuable." Id. (internal citations
omitted).

  The Board has consistently stated that,
during an election to determine
representation, voting is to occur in a
"laboratory in which an experiment may be
conducted, under conditions as nearly
ideal as possible, to determine the
uninhibited desires of employees." In re
General Shoe Corp., 77 N.L.R.B. 124, 127
(1948). In the instant case, where
representation was decided by one vote
and gifts of substantial value were
offered by the Union as part of its
campaign, we find that laboratory
conditions did not exist. In light of the
above, we conclude that the NLRB did not
act reasonably in certifying the Union as
the bargaining agent of River City’s
employees. Furthermore, we find that the
Board’s factual findings that the Union
did not interfere with employees’ free
choice in the election by improperly
offering gifts is not supported by
substantial evidence in the record as a
whole.

III.   CONCLUSION

  For the foregoing reasons, we DENY the
Board’s application to enforce its
bargaining order and REVERSE any finding
by the Board that River City committed an
unfair labor practice.

FOOTNOTES

/1 In addition, the Union requested certain informa-
tion related to its proposed collective bargain-
ing solicitation.

/2 A Mechanic’s card enables an individual to work
as a full Mechanic in the elevator industry.
/3 In addition, the Union offered to reduce monthly
dues to $20 a month, until the employees began
working under covered employment conditions.

/4 From the record, it appears that all seven of the
River City employees had worked for considerable
time in the elevator industry.