Court Opinion

ID: 2970527
Source: CourtListenerOpinion
Date Created: 2015-09-22 16:15:26.102641+00
Date Added: 2024-06-11T09:18:16.935253
License: Public Domain

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    $*5,&8/785$/ ,03/(0(17                                      implemented by a centralized agency. Specifically, the Court
                                                                in New York Telephone Co. stated,
    :25.(56 2) $0(5,&$
    $)/&,2 6800(5¶6 /,9,1*                                      The overriding interest in a uniform, nationwide
                                    
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                                                                   interpretation of the federal statute by the centralized
                      ,QWHUYHQRUV 1                               expert agency created by Congress not only demands that
                                                                   the NLRB’s primary jurisdiction be protected, it also
                                                                   forecloses overlapping state enforcement of the
       2Q3HWLWLRQVIRU5HYLHZDQG&URVV$SSOLFDWLRQIRU           prohibitions in § 8 of the Act [29 U.S.C. § 158] . . . as
                 (QIRUFHPHQWRIDQ2UGHURIWKH                    well as state interference with the exercise of rights
                1DWLRQDO/DERU5HODWLRQV%RDUG                    protected by § 7 of the Act [29 U.S.C. § 157].
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                                                                 Id. at 528 (citations and footnotes omitted). See also NLRB
                     $UJXHG-XO\                      v. Waterman S.S. Corp., 309 U.S. 206, 226 (1940) ("The
                                                                 control of the election proceedings, and the determination of
             'HFLGHGDQG)LOHG2FWREHU                the steps necessary to conduct that election fairly were
                                                                 matters which Congress entrusted to the Board alone.")
      %HIRUH6,/(5&2/(DQG&/$<&LUFXLW-XGJHV            Further, we note that the extension of comity to the MERC-
                                                                 conducted elections involving SLS would appear to be
                     BBBBBBBBBBBBBBBBB                           inconsistent with the Board’s own policy. See Doctor’s
                          &2816(/                                Osteopathic Hosp., 242 NLRB 447, 449 (1979), aff’d 624
                                                                 F.2d 1089 (3d Cir. 1980) (noting that "it is only where the
$5*8('  *UHJRU\ - %DWRU %$725 	 %(5/,1                state agency’s procedure is clearly repugnant to the Act that
%LUPLQJKDP0LFKLJDQIRU3HWLWLRQHUVDQG6XPPHU¶V/LYLQJ        we will refuse comity"). Accordingly, we deny AFSCME’s
6\VWHPV ,QF  5LFKDUG $ &RKHQ 1$7,21$/ /$%25           petition for review.
5(/$7,216 %2$5' 2)),&( 2) 7+( *(1(5$/
&2816(/:DVKLQJWRQ'&IRU5HVSRQGHQW0DUJDUHW$                               CONCLUSION
0F&DQQ :DVKLQJWRQ '& IRU $PHULFDQ )HGHUDWLRQ RI
6WDWH &RXQW\ 	 0XQLFLSDO (PSOR\HHV $)6&0( $)/          For the foregoing reasons, we DENY the petitions for
&,221%5,()*UHJRU\-%DWRU%$725	%(5/,1               review by MCS in Case No. 00-2192 and AFSCME in Case
%LUPLQJKDP$ODEDPDIRU3HWLWLRQHUVDQG6XPPHU¶V/LYLQJ         No. 00-2451, and ENFORCE the Board’s order in Case No.
6\VWHPV ,QF 'DQLHO $ *ZLQQ %$725 	 %(5/,1            00-2440 finding that it is supported by substantial evidence
%LUPLQJKDP0LFKLJDQ5RGJHU:HEE'HWURLW0LFKLJDQIRU        on the record.
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     "Want of jurisdiction of the subject matter cannot be         0DUJDUHW $ 0F&DQQ :DVKLQJWRQ '& IRU $PHULFDQ
  waived; that jurisdiction of the subject matter cannot be        )HGHUDWLRQ RI 6WDWH &RXQW\ 	 0XQLFLSDO (PSOR\HHV
  supplied by the consent of the parties; and that objection       $)6&0($)/&,2&DWKHULQH-7UDIWRQ$662&,$7(
  to lack of such jurisdiction may be interposed or noticed        *(1(5$/&2816(/,17(51$7,21$/81,218$:
  at any stage of the action." 1A Barron and Holtzoff, Fed.        'HWURLW 0LFKLJDQ *HRUJH % :DVKLQJWRQ 6&+()) 	
  Practice and Procedure, § 370b (Wright ed., 1960).               :$6+,1*721 'HWURLW 0LFKLJDQ /DZUHQFH 5 :HEE
                                                                   'HWURLW0LFKLJDQ'DQLHO$*ZLQQ%$725	%(5/,1
353 F.2d 366, 369 (6th Cir. 1965). Thus, the Board was free        %LUPLQJKDP0LFKLJDQIRU,QWHUYHQRUV
to exercise its discretion and assume jurisdiction at any time.
                                                                                       BBBBBBBBBBBBBBBBB
   In this case, the Board, after issuing Management Training,
had exclusive jurisdiction to direct or supervise the elections.                           23,1,21
See Sears, Roebuck & Co. v. Carpenter’s Dist. Council (San                             BBBBBBBBBBBBBBBBB
Diego), 436 U.S. 180, 202 (1978) ("The primary-jurisdiction
rationale unquestionably requires that when the same                  &/$<&LUFXLW-XGJH0LFKLJDQ&RPPXQLW\6HUYLFHV,QF
controversy may be presented to the state court or the NLRB,       DQGWZHQW\HLJKWRWKHUQRQSURILWFRUSRUDWLRQVFROOHFWLYHO\
it must be presented to the Board.") As Intervenor SLS             ³0&6´ ZKLFK DUH OLFHQVHG E\ WKH 6WDWH RI 0LFKLJDQ WR
rightly argues, quoting from San Diego Building Trades             SURYLGHUHVLGHQWLDOFDUHIRUGHYHORSPHQWDOO\GLVDEOHGDGXOWV
Council v. Garmon, 359 U.S. 236, 246 (1959), state                 LQDUHVLGHQWLDOVHWWLQJDSSHDOLQ&DVH1Rfrom the
jurisdiction is displaced if conduct is "arguably within the       final decision and order entered by the National Labor
compass of § 7 or § 8 of the Act." Given that the elections        Relations Board ("the NLRB" or "the Board") in Summer’s
were "arguably within the compass of § 7 or § 8 of the Act,"       Living Systems, Inc., 2000 WL 1460041 (NLRB 2000)
the elections conducted by MERC should be void. See Mass.          (unpublished) in which the NLRB declined to set aside union
Labor Relations Comm’n v. Blue Hill Spring Water Co., 414          representation elections and held that MCS engaged in unfair
N.E.2d 351 (Mass. Ct. App. 1980) (recognizing that                 labor practices under §§ 7 and 8(a)(1) and (5) of the National
proceedings in the Massachusetts Labor Relations Committee         Labor Relations Act, 29 U.S.C. §§ 157, 158(a)(1) and
would be void if the Board had asserted jurisdiction of an         (5) ("the Act") by refusing to bargain collectively with the
unfair labor practice complaint).                                  American Federation of State, County & Municipal
                                                                   Employees, AFL-CIO ("AFSCME"), and the International
  Because MERC did not have jurisdiction to conduct the            Union, United Automobile, Aerospace and Agricultural
elections involving SLS after the issuance of Management           Implement Workers of America, AFL-CIO ("UAW"),
Training, the Board properly refused to extend comity to           (collectively, "the Unions"), after the unions won the
these MERC-conducted elections. As pointed out by SLS,             elections. In Case No. 00-2440, the NLRB has cross-
extending comity in this case would directly violate the intent    petitioned for enforcement of the order; the Unions have
of Congress to vest exclusive jurisdiction with the Board and      intervened in support of the NLRB’s cross-petition. In Case
subvert the goal announced in New York Telephone Co. v.            No. 00-2451, AFSCME seeks review of the NLRB’s decision
New York State Dept. of Labor, 440 U.S. 519 (1979) of              and order in Summer’s Living Systems dismissing unfair labor
promoting a unified nationwide scheme of labor law                 practice allegations against Summer’s Living Systems, Inc.
                                                                   and eight other employers (collectively "SLS") that own
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     HWDOY1/5%                                                                                      HWDOY1/5%

residential care facilities. SLS has intervened in opposition    concerning assertion of that oversight." Pikeville, 109 F.3d at
to AFSCME’s petition.                                            1152 (internal citations and quotation marks omitted).
  In Summer’s Living Systems, the Board issued a decision          In determining whether the Board had jurisdiction, this
and order affirming the decision made by the administrative      Court in Pikeville set forth the following standard: "Under a
law judge ("ALJ") to extend comity to the union                  Management Training Corp. analysis, the jurisdiction of the
representation elections conducted by the Michigan Employee      NLRB over [an employer] is established simply by the
Relations Commission ("MERC") in thirty residential care         minimal showing that the [employer] both "meets the
facilities owned by MCS that took place before Management        definition of ‘employer’ under Section 2(2) of the Act," and
Training Corp., 317 NLRB 1355 (1995) was decided, but not        "meets the applicable monetary jurisdictional standards." Id.
to extend comity to the MERC-conducted elections in the          Under this test, the Board properly had jurisdiction over SLS.
residential care facilities owned by SLS that took place after
Management Training was decided on the ground that MERC            In this regard, there is no merit to AFSCME’s claim that
lacked jurisdiction to conduct those union representation        SLS waived the jurisdictional issue by failing to raise it
elections. In Management Training, the Board, overruling the     before the MERC elections were held or before the Board in
jurisdictional test set forth in 5HV&DUH,QF1/5%    Summer’s Living Systems, Inc. As the Intervenors SLS point
decided that it had MXULVGLFWLRQRYHUDQHPSOR\HUZLWK   out, their failure to contest the jurisdiction of the MERC at the
FORVHWLHVWRDQH[HPSWJRYHUQPHQWDOHQWLW\DVGHILQHGXQGHU    time of the elections does not prevent the Board from
86& Accordingly, the Board upheld the unfair    concluding that the MERC lacked jurisdiction to conduct the
labor practice complaints filed against MCS, but dismissed       elections after Management Training. As this Court noted in
those filed against SLS. For the reasons set forth below, we     NLRB v. Ferraro’s Bakery, Inc.:
DENY the petitions for review by MCS in Case No. 00-2192
and by AFSCME in Case No. 00-2451, and ENFORCE the                 The Board concedes that the question of its statutory
Board’s order in Case No. 00-2440.                                 jurisdiction may be raised at any time despite failure to
                                                                   raise this issue before the Board in a timely fashion.
                     BACKGROUND                                    Failure to file exceptions does not confer jurisdiction on
                                                                   the Board if the order is beyond the scope of its statutory
  The present case concerns a dispute between a group of           authority. As said in N.L.R.B. v. Cheney California
Michigan non-profit corporations operating group homes             Lumber Company, 327 U.S. 385, 388, 66 S. Ct. 533, 554,
providing residential care and services to individuals with        90 L.Ed. 739:
disabilities (collectively "the Employers") and the Unions
representing their employees regarding the employees’ rights           "Since the court is ordering entry of a decree, it
to choose union representation under § 7 of the Act. The             need not render such a decree if the Board has
State of Michigan Department of Mental Health ("MDMH")               patently traveled outside the orbit of its authority so
funds the Employers’ operations through annual contracts that        that there is, legally speaking, no order to enforce."
establish defined limits upon wages and benefits that the
Employers may pay. In 1985, the Unions began organizing            It is elementary that:
efforts at the Employers’ residential care facilities, with
AFSCME filing several election petitions with the Board’s
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     HWDOY1/5%                                                                                      HWDOY1/5%

1995); NLRB v. Winco Petroleum Co., 668 F.2d 973, 982 (8th        regional office in Detroit, Michigan, seeking to represent the
Cir. 1982). As stated in Fall River, the appropriate inquiry is   employees of the Employers operating under contracts with
whether any changes have occurred such that "if [the              MDMH. In CK Homes, Inc. v. AFSCME, an unpublished
employees’] legitimate expectations in continued                  decision of the NLRB Seventh Region Director, decided
representation by their union are thwarted, their                 February 14, 1986 (Case No. 7-RM-1275) and Residential
dissatisfaction may lead to labor unrest." Fall River, 482 U.S.   Systems v. UAW, an unpublished decision of the NLRB
at 43-44. Further, as the Board points out, to allow new          Seventh Region Director, decided April 7, 1988 (Case No.
elections in this case would permit MCS "to exploit the           No. 7-RC-18529), the Board, relying primarily upon Res-
heightened insecurities among employees" to the detriment of      Care Inc., 280 NLRB 670 (1980), dismissed AFSCME’s
the Act’s fundamental policy of favoring "industrial peace."      petitions, citing lack of subject-matter jurisdiction under the
In any event, it is well recognized that the employees have the   Act on the basis that the State of Michigan was an exempt
statutorily-protected right of relieving themselves of union      governmental entity.
representation if they so desire. See Auciello Iron Works, Inc.
v. NLRB, 517 U.S. 781, 790 (1996)(observing that the union           Thereafter, on January 28, 1988, AFSCME filed petitions
was "subject to a decertification petition from the workers if    with MERC seeking to represent the employees of the
they want to file one"); Franks Bros. Co. v. NLRB, 321 U.S.       Employers’ separate units, naming MDMH and the group
702, 704-06 (1944). Thus, if the employees are not well-          home providers as joint employers. MDMH opposed the
served by union representation, they can pursue                   petitions naming it as a joint employer, claiming that
decertification petitions.                                        MERC’s jurisdiction over each private employer was
                                                                  preempted as a matter of federal labor policy. After finding
  Accordingly, we find that the Board did not err in              that the named employers were joint employers, MERC
extending comity to the MERC-conducted elections held             asserted jurisdiction over MDMH under the Michigan Public
before the issuance of Management Training. We thus deny          Employment Relations Act ("PERA"), Mich. Comp. Laws
MCS’ petition for review.                                         Ann. §§ 423.201423.216, and over the group home
                                                                  providers under the Michigan Labor Mediation Act
Case No. 00-2451: AFSCME’s Petition                               ("MLMA"), Mich. Comp. Laws Ann. §§ 423.1423.30. In
                                                                  asserting jurisdiction, MERC relied upon the Board’s refusal
  On the other hand, contrary to AFSCME’s claim, the Board        to assert jurisdiction over the group home providers under the
did not err in declining to extend comity to the MERC-            Act and the decision of the Michigan Civil Service
conducted elections after Management Training was decided         Commission not to classify the employees of the group homes
on the basis that MERC lacked jurisdiction to hold these          as state civil service employees. See AFSCME v. La. Homes,
elections. In reviewing this claim, we note that the NLRB         Inc./Mich. Dep’t of Mental Health, MERC Case No. R88 C-
"has discretion whether to exercise jurisdiction." Pikeville,     112, 1989 MERC Lab Op 51, 1990 MERC Lab Op 491, aff’d,
109 F.3d at 1152 (quoting Crestline Memorial Hosp. Ass'n,         AFSCME v. La. Homes, 480 N.W.2d 280 (Mich. Ct. App.
Inc. v. NLRB, 668 F.2d 243, 244 (6th Cir.1982)). "Thus,           1991), appeal denied, 487 N.W.2d 410 (Mich. 1992),
absent a showing that [the Board] acted unfairly and caused       vacated, 503 N.W.2d 442 (Mich. 1992), reaff’d on remand,
substantial prejudice to the affected employer, a reviewing       511 N.W.2d 696 (Mich. Ct. App. 1994), appeal denied, 521
court should not disturb the NLRB’s discretionary decision        N.W.2d 607 (Mich. 1994), cert. denied sub. nom., Mich.
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        HWDOY1/5%                                                                                         HWDOY1/5%

Dep’t of Mental Health v. Louisiana Homes, Inc., 513 U.S.                  Here, the Board reasonably rejected as speculative the
1077 (1995) ("Louisiana Homes").                                        claim of MCS that the contracts between MCS and MDMH
                                                                        legally preclude MCS and their employees from bargaining
   MERC then directed and conducted elections involving the             about improved wages, benefits, staffing levels and the like.
joint employers, as authorized by PERA. After elections were            Even though the contracts with MDMH set the wages,
conducted on April 20, 1989, the ballots were impounded, but            benefits and staffing levels for which MCS will be
eventually counted by MERC on June 29, 1990. The Unions                 reimbursed during the contracts’ annual term, these contracts
won each election.$VDFRQVHTXHQFH0(5&FHUWLILHGWKH               do not prevent the employers from agreeing to increase such
EDUJDLQLQJUHSUHVHQWDWLYHVJLYLQJXQLWHPSOR\HHVEDUJDLQLQJ            terms during collective bargaining with their employees.
ULJKWVZLWKUHVSHFWWR0'0+DQGWKHLUSULYDWHHPSOR\HUVDV             Thus, there is no credible evidence that MCS’ employees
MRLQW HPSOR\HUV  0'0+ KRZHYHU UHIXVHG WR KRQRU                would have rejected union representation had they known
0(5&¶V FHUWLILFDWLRQV DQG FKDOOHQJHG WKHP LQ VWDWH FRXUW        that MDMH would not be present at the bargaining table.
VHHNLQJ MXGLFLDO UHYLHZ RI WKH 0(5&¶V DVVHUWLRQ RI
MXULVGLFWLRQE\FODLPLQJWKDWLWZDVQRWDMRLQWHPSOR\HURIWKH           As the Board perceptively points out, the only real change
VXEMHFWXQLW HPSOR\HHV DQG FRQWHQGLQJ WKDW WKH $FW                in the employees’ situation resulting from the Board’s
SUHHPSWHGVWDWHODZ0(5&¶VDVVHUWLRQRIMXULVGLFWLRQZDV              recognition of the MERC-conducted elections held before the
HYHQWXDOO\ XSKHOG RQ DSSHOODWH UHYLHZ LQ WKH /RXLVLDQD           issuance of Management Training is that MCS’ employees
+RPHV litigation. Throughout the appellate proceedings, the             are now authorized to strike. As the Board notes, the
Employers took the same position as AFSCME, that they and               employees were prohibited from striking against an exempt
MDMH were joint employers subject to MERC’s jurisdiction                governmental entity under PERA. However, under the
which was not preempted by the Act. During this time,                   Board’s jurisdiction, the employees are permitted to strike,
however, no bargaining in the certified units took place                thus strengthening their ability to enforce their bargaining
because the Employers were unwilling to participate in                  demands. Given that the employees were given authorization
bargaining if MDMH was also not a participant.                          to strike, the Board correctly reasons that it is unlikely that
                                                                        the changed circumstance occasioned by the Board’s
   After the United States Supreme Court denied MDMH’s                  jurisdiction of this matter would cause the employees to
petition for a writ of certiorari in the Louisiana Homes case           abandon union representation. Because it is not very likely
on January 9, 1995, bargaining eventually commenced, but                that the absence of the MDMH at the bargaining table would
did not last long. In mid-1995, the Board announced a                   have affected employee views and attitudes about union
change in policy in Management Training, overruling the test            representation, there was no support for nullifying the
stated in Res-Care and declaring that it had jurisdiction over          elections upon the basis of a changed circumstance.
private employers under contract with exempt state agencies.
In light of the Board’s decision in Management Training,                  Consequently, MCS cannot repudiate its bargaining
MDMH petitioned the Michigan Court of Appeals to                        obligations. As the Board makes clear, the situation in this
reconsider and reverse its previous decision finding that               case is similar to one in a successorship context in which new
                                                                        owners cannot repudiate an existing bargaining obligation on
                                                                        the ground of changed circumstances. See Fall River Dyeing
    
     $ ZRQ DOO WKH HOHFWLRQV H[FHSW IRU RQH WKDW ZDV ZRQ E\ WKH   & Finishing Corp. v. NLRB, 482 U.S. 27, 38, 47 (1987);
8$:                                                                    ARMCO, Inc. v. NLRB, 832 F.2d 358, 362-63 (6th Cir.
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     HWDOY1/5%                                                                                         HWDOY1/5%

that MERC conducted the elections, it was the case that           MERC’s jurisdiction was not preempted as a matter of federal
MDMH was considered to be a joint employer. However, as           labor policy. Thereafter, on January 26, 1996, the Michigan
Intervenor AFSCME states, "everyone knew, or should have          Court of Appeals, in reliance upon Management Training,
known, that the status of the state as employer under PERA        vacated MERC’s decisions requiring the Employers and
was subject to vigorous litigation." AFSCME Br. at 22.            MDMH to bargain with the Unions in all the adult residential
Thus, contrary to MCS’ unsupported assertion, there is no         care cases before MERC, concluding that MERC’s
indication that the MERC-conducted elections at the time          jurisdiction was preempted as a matter of federal labor policy.
"denied employees a free and fair choice based upon the            AFSCME v. Mental Health Dep’t., 545 N.W.2d 363 (Mich.
truth;" nor is there any basis to believe that "the complexity    Ct. App. 1996).7KXVWKH0LFKLJDQ&RXUWRI$SSHDOVKHOG
of the interrelationships between the State of Michigan           WKDWWKHDGXOWUHVLGHQWLDOFDUHSURYLGHUVWKDWFRQWUDFWHGZLWK
Department of Mental Health, the state judiciary, the MERC,       0'0+ZHUHSURSHUO\XQGHUWKHMXULVGLFWLRQRIWKH%RDUG
the Board, and the parties to the election robbed employees       $VDUHVXOW0'0+DQGWKH(PSOR\HUVZHUHUHOLHYHGRIDQ\
and Employers of a clear understanding as to the impact of        GXW\ WR EDUJDLQ XQGHU VWDWH ODZ  7KHUHDIWHU WKH 0LFKLJDQ
the union elections." MCS Br. at 18. Because there was no         &RXUW RI $SSHDOV LQ DQ RUGHU HQWHUHG RQ 0DUFK  
misrepresentation concerning MDMH’s status as a joint             GHQLHG $)6&0(¶V PRWLRQ IRU UHKHDULQJ EXW JUDQWHG LWV
employer, there is no basis to set aside the elections.           PRWLRQIRUDVWD\
   Nevertheless, MCS’ real complaint is whether the changed         ,QWKHPHDQWLPHDIWHUWKH%RDUG¶VGHFLVLRQLQ0DQDJHPHQW
circumstance of MDMH not being at the bargaining table            7UDLQLQJEXWEHIRUHWKH0LFKLJDQ&RXUWRI$SSHDOVUXOHGRQ
called into question whether the election results reflected the   WKHIHGHUDOSUHHPSWLRQLVVXHLQ$)6&0(Y0HQWDO+HDOWK
desires of their employees to be represented by the Unions.       'HS¶WAFSCME proceeded with elections that previously had
Thus, MCS claims:                                                 been directed by MERC, though not yet conducted.
                                                                  AFSCME won those union representation elections involving
  Had employees known in the present case that the State          the employees of units of Summer’s Living Systems, Inc. and
  of Michigan would ultimately not participate in                 eight other employers ("SLS"). However, following the
  collective bargaining, the result of the election could         Michigan Court of Appeals’ decision in AFSCME v. Mental
  easily have been different.              Without the            Health Dep’t vacating MERC’s certifications on preemption
  misrepresentation regarding the state’s involvement,            grounds, the State of Michigan refused to bargain with the
  employees could have weighed the extraction of union            Unions. When the Unions requested that the Employers
  dues out of modest earnings against the improbability of        continue to bargain under the Act without MDMH’s
  the union securing higher wages or different working            participation, the Employers refused, claiming that the
  conditions.                                                     changed circumstancethe absence of MDMH from the
MCS Br. at 22-23. According to MCS, the elections should
be invalidated because "[i]t is doubtful that employees would         
have voted for a decrease in their wages to finance a union            $IWHU WKH GHFLVLRQ LQ AFSCME v. Mental Health Dep’t, 545 N.W.2d
dues deduction, in light of the improbability of wage             363 (Mich. Ct. App. 1996), WKH 0LFKLJDQ OHJLVODWXUH DPHQGHG 3(5$ DW
                                                                  0LFK &RPS /DZV $QQ  H WR GHILQH HPSOR\HHV ZKR ZRUNHG
increases at the bargaining table." MCS Br. at 27.                IRU D SULYDWH HQWLW\ XQGHU FRQWUDFW ZLWK WKH 6WDWH DV SULYDWH VHFWRU
                                                                  HPSOR\HHV DQG WKHUHIRUH QRW SURWHFWHG E\ 3(5$
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        HWDOY1/5%                                                                                                HWDOY1/5%

bargaining processundermined the efficacy of MERC’s                          1979); accord Lincoln Park Zoological Soc’y v. NLRB, 116
elections as a basis for requiring the Employers to bargain as                F.3d 216, 219-20 (7th Cir. 1997) (extending comity to
a matter of federal labor policy. Thus, all collective                        voluntary recognition of the union where, pursuant to the state
bargaining came to a halt. The Unions contacted the Board                     public employee relations act, the employer has the initial
on March 18, 1996, formally demanding bargaining by the                       chance to refuse to recognize a union and the employees had
Employers.                                                                    a right to decertify the union but failed to exercise it). Thus,
                                                                              based upon the criteria set forth in Standby One Associates,
  Thereafter, the Unions filed unfair labor practice charges                  the Board properly extended comity to the MERC-conducted
with the Board against thirty-eight of the group home                         elections.
providers contracted by MDMH, alleging refusal to bargain
under the Act as the sole employers of employees in the                          There is no merit to MCS’ claim that the MERC-conducted
subject units.Based upon the charges filed by the Unions,                  elections should be set aside based upon the alleged
the Board issued a series of consolidated unfair labor practice               misrepresentation that MDMH was a joint employer in these
complaints alleging that the refusal to bargain violated                      proceedings.        According to MCS, the alleged
§ 8(a)(1) and (5) of the Act, 29 U.S.C. § 158(a)(1) and (5).                  misrepresentation concerning MDMH’s role affected the free
After hearings in Detroit, Michigan on January 29 and 30,                     and fair conduct of the elections. Specifically, MCS contends
1997, the administrative law judge ("ALJ") issued a decision                  that the Board applied the wrong legal standard in evaluating
in which he found it appropriate to extend comity to the                      the facts. In support of their claim of misrepresentation, MCS
elections that MERC had conducted when MERC properly                          relies upon the five-factor test announced in Mitchellace, Inc.
had jurisdiction over the private employers.7KXVWKH$/-                  v. NLRB, 90 F.3d 1150, 1155 (6th Cir. 1996). As this Court
IRXQG WKDW 0&6 violated § 8(a)(1) and (5) of the Act, 29                   stated in NLRB v. Gormac Custom Mfg., Inc., 190 F.3d 742
U.S.C. § 158(a)(1) and (5) by refusing to recognize and                       (6th Cir. 1999): "These factors include: (1) the timing of the
bargain with the Unions.,QVRKROGLQJWKH$/-UHMHFWHGWKH                misrepresentation; (2) whether the employer was aware of the
(PSOR\HUV¶DUJXPHQWWKDWWKHDEVHQFHRI0'0+IURPWKH                         situation and had an opportunity to respond; (3) the extent of
EDUJDLQLQJ WDEOH UHSUHVHQWHG D FKDQJHG FLUFXPVWDQFH WKDW                the misrepresentation; (4) whether the source of the
SUHYHQWHG WKH %RDUG IURP H[WHQGLQJ FRPLW\ WR WKH 0(5&                 misrepresentation was identified; and (5) whether there is
HOHFWLRQVDVDPDWWHURIIHGHUDOODERUSROLF\+RZHYHUZLWK                 evidence that employees ‘actually were affected’ by the
                                                                              misrepresentation." Id. at 747 (citing Mitchellace, 90 F.3d at
                                                                              1155). In Gormac, this Court added that "another factor that
    
                                                                              plays a part in our analysis is the closeness of the election."
      ,Q WKLV FDVH WKHUH DUH WKLUW\HLJKW JURXS KRPH SURYLGHUV DQG IRUW\     190 F.3d at 747 (citing NLRB v. Hub Plastics, 52 F.3d 608,
XQLWV DW LVVXH 7ZR SURYLGHUV $OWHUQDWLYH 6HUYLFHV DQG &DUVRQ¶V $)&         613 (6th Cir. 1995)).
KHOG HOHFWLRQV ERWK EHIRUH DQG DIWHU -XO\   WKXV DFFRXQWLQJ IRU WKH
GLIIHUHQFH EHWZHHQ WKH QXPEHU RI SURYLGHUV DQG VXEMHFW XQLWV
                                                                                What is wrong with this line of attack is that there was no
                                                                             misrepresentation that supports setting aside the elections.
     7KH $/-¶V GHFLVLRQ LV DWWDFKHG WR    6XPPHU¶V /LYLQJ 6\VWHPV 6HH
 :/  DW 
                                                    Specifically, there was no evidence in the record that MCS’
                                                                              employees were misled by the status of MDMH at the time of
                                                                             the elections, even though MCS had every opportunity to
     ([FHSW IRU RQH LQVWDQFH DOO WKH XQIDLU ODERU SUDFWLFHV LQYROYHG WKH
AFSCME.                                                                       present such evidence during these proceedings. At the time
   0LFK&RPPXQLW\6HUYV         1RV        1RV         0LFK&RPPXQLW\6HUYV        
     HWDOY1/5%                                                                                        HWDOY1/5%

   In this case, the Board, adopting the ALJ’s findings,           UHJDUGWRSLS, the ALJ held that its employees had voted in
properly extended comity to the MERC elections conducted           elections conducted by MERC after the Board’s announced
before the issuance of Management Training. Specifically,          change in policy preempted MERC’s jurisdiction. Thus, the
the Board, citing Standby One Associates, 274 NLRB 952             ALJ dismissed the unfair labor practice allegations as to SLS,
(1985), found that (1) the state-conducted elections reflect[ed]   finding that the principles of comity should not be applied to
the true desires of the affected employees; (2) there was no       the MERC-conducted elections due to MERC’s lack of
showing of election irregularities; and (3) there was no           jurisdiction.
substantial deviation from due process requirements."
Summer’s Living Sys., Inc., 2000 WL 1460041, at *3. First,            In its decision issued on September 25, 2000, the Board
it would appear that the state-conducted elections reflected       affirmed the ALJ’s decision to extend comity to the MERC
the true desires of the affected employees. As pointed out by      elections that took place before Management Training was
Intervenor AFSCME, eighty-five percent of the employees in         decided on July 28, 1995, but not to extend comity to the
the thirty subject units voted in favor of union representation.   MERC elections that took place after Management Training
Moreover, in nine of the units, there were zero votes cast         was decided "when [MERC] did not have jurisdiction."
against union representation. There was also no showing of         Summer’s Living Systems, Inc., 2000 WL 1460041. In its
election irregularities. As Intervenor AFSCME notes, no            decision, the Board, citing Standby One Associates, 274
objections were filed in these elections. Afterwards, there        NLRB 952 (1985), found that the ALJ correctly applied the
was no decertification petition or challenge to the MERC           Board’s comity policy and adopted the findings of the ALJ as
elections. Id.                                                     to MCS that "(1) the state-conducted elections reflect the true
                                                                   desires of the affected employees; (2) there was no showing
   There was also no apparent deviation from due process           of election irregularities; and (3) there was no substantial
requirements. In particular, there was testimony that state-       deviation from due process requirements." Summer’s Living
election procedures are as rigorous as the Board’s. While          Systems, Inc., 2000 WL 1460041, at *3. The Board further
MCS suggests that "[t]he State of Michigan’s extensive             found that "for the reasons stated by the [ALJ] . . . the
involvement in the election process painted the proceedings        removal of joint employer DMH from the bargaining table is
with the authority of state government," MCS Br. at 20, there      not such an unusual circumstance as to relieve [MCS] from
is no credible evidence that the elections did not accord with     their bargaining obligation." Id. Accordingly, the Board,
due process.                                                       with minor modifications not pertinent to the present appeals,
                                                                   upheld the unfair labor practice complaints filed against
   Moreover, the Board properly found that the MERC-               MCS, but dismissed the unfair labor practice complaints
conducted elections were consistent with the policies and          against SLS.
procedures of the Act. As the Board points out, it has been its
longstanding policy to recognize as binding the results of           In its appeal in Case No. 00-2192, MCS contends that the
state-conducted elections "provided that the state proceedings     representation elections should be invalidated because the
reflect the true desires of the affected employees, election       elections were conducted under the misrepresentation that the
irregularities are not involved, and there has been no             State of Michigan was a joint employer. According to MCS,
substantial deviation from due process requirements."              "the post-election departure of the State of Michigan from its
Allegheny Gen. Hosp., 230 NLRB 954, 955 (1977),                    role as co-employer was a material change in circumstances
enforcement denied on other grounds, 608 F.2d 965 (3d Cir.         that so radically affected relationships at the bargaining table
       0LFK&RPPXQLW\6HUYV           1RV        1RV        0LFK&RPPXQLW\6HUYV        
         HWDOY1/5%                                                                                         HWDOY1/5%

that the employees lacked any knowledge of the true context                  declares not how a case shall be decided but how it
in which their votes for unionization were cast." MCS Br. at                 may with propriety be decided.
7-8. In Case No. 00-2440, the NRLB cross-petitions for
enforcement of its order. On the other hand, AFSCME in its                    The statement, however, was made in a far different
appeal in Case No. 00-2451 argues that the Board erred in not              context, namely, the extent to which one federal court of
extending comity to the elections that MERC conducted after                appeals should feel itself bound by the decision of
Management Training was decided.                                           another with respect to the validity and scope of a patent.
                                                                           Both courts were governed by the same law and the
                            DISCUSSION                                     statement was made in deprecating the appellant's claim
                                                                           that the second court of appeals had given insufficient
   Before addressing the merits of the Board’s decisions to                weight to "comity". More enlightening for this case,
extend comity to the MERC-conducted elections before the                   although not dispositive, is this court's recent statement
date on which Management Training was decided, but not to                  in NLRB v. St. Luke's Hospital, 551 F.2d 476 (2d Cir.
those conducted after Management Training was issued, it is                1976). There we upheld a finding that an employer had
useful to consider the key decisions culminating in the                    engaged in an unfair labor practice by enforcing the
Board’s change of policy articulated in Management Training                union security clause in a collective bargaining
regarding its jurisdiction over certain private employers with             agreement with a union certified by the SLRB to
contractual relationships with exempt governmental entities.               represent a unit which could not have been approved by
Initially, in National Transportation Service, Inc. v. Truck               the NLRB because of the "professional" proviso in
Drivers & Helpers of America, Local Union 728, 240 NLRB                    § 9(b)(1). Rejecting the employer's claim to comity,
565 (1979), the NLRB set forth a test for determining whether              Chief Judge Kaufman said, id. at 482 (citations omitted):
it would exercise jurisdiction over employers with close ties
to an exempt entity:                                                         Arrangements resulting from state agency
                                                                             proceedings should generally be respected if
  [I]n this and future cases involving a determination                       consistent with federal policies. "Comity" in this
  whether the Board should assert jurisdiction [over an                      sense reflects the desirability of supporting settled
  employer with close ties to an exempt entity], we shall                    relationships in the absence of compelling
  determine whether the employer itself meets the                            countervailing reasons. It is clear, however, that the
  definition of "employer" in [29 U.S.C. 152(2)],DQGLI                   NLRB is not required to defer to state proceedings
                                                                             where federal policy would be undermined.

                                                                            We would strengthen the last sentence to say "is not
      6HFWLRQ  SURYLGHV
                                                                           required or permitted."
      7KH WHUP HPSOR\HU LQFOXGHV DQ\ SHUVRQ DFWLQJ DV DQ DJHQW
     RI DQ HPSOR\HU GLUHFWO\ RU LQGLUHFWO\ EXW VKDOO QRW LQFOXGH WKH   566 F.2d 833, 841-42 (2d Cir. 1977). Thus, as understood by
     8QLWHG 6WDWHV RU DQ\ ZKROO\ RZQHG *RYHUQPHQW FRUSRUDWLRQ RU        the Second Circuit in Long Island College Hospital, "comity"
     DQ\ )HGHUDO 5HVHUYH %DQN RU DQ\ 6WDWH RU SROLWLFDO VXEGLYLVLRQ     refers to a rule of convenience or expediency whereby the
     WKHUHRI RU DQ\ SHUVRQ VXEMHFW WR WKH 5DLOZD\ /DERU $FW >
                                                                         Board sustains settled issues or relationships, so long as
     86&$   HW VHT@ DV DPHQGHG IURP WLPH WR WLPH RU DQ\
     ODERU RUJDQL]DWLRQ RWKHU WKDQ ZKHQ DFWLQJ DV DQ HPSOR\HU RU
                                                                         federal policy is not undermined.
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      HWDOY1/5%                                                                                         HWDOY1/5%

explained by the Supreme Court in Hilton v. Guyot, 159 U.S.         VRGHWHUPLQHZKHWKHUWKHHPSOR\HUKDVVXIILFLHQWFRQWURO
113 (1895),                                                         RYHU WKH HPSOR\PHQW FRQGLWLRQV RI LWV HPSOR\HHV WR
                                                                    HQDEOH LW WR EDUJDLQ ZLWK D ODERU RUJDQL]DWLRQ DV WKHLU
    "Comity" in the legal sense, is neither a matter of             UHSUHVHQWDWLYH
  absolute obligation, on the one hand, nor of mere
  courtesy and good will, upon the other. But it is the             2QFHLWLVGHWHUPLQHGWKDWWKHHPSOR\HUFDQHQJDJH
  recognition which one nation allows within its territory          LQPHDQLQJIXOFROOHFWLYHEDUJDLQLQJZLWKUHSUHVHQWDWLYHV
  to the legislative, executive, or judicial acts of another        RILWVHPSOR\HHVMXULVGLFWLRQZLOOEHHVWDEOLVKHG
  nation, having due regard both to international duty and
  convenience, and to the rights of its own citizens, or of       1DW¶O7UDQVS6HUY,QF1/5%DW7KHUHDIWHULQ&.
  other persons who are under the protection of its laws.         +RPHV ,QF Y $)6&0( DQ XQSXEOLVKHG GHFLVLRQ RI WKH
                                                                  1/5%6HYHQWK5HJLRQ'LUHFWRUGHFLGHG)HEUXDU\
Id. at 163-64. By extension, the rule of comity also applies to   &DVH 1R 50 WKH UHJLRQDO GLUHFWRU KHOG WKDW WKH
the recognition of federal and state courts of their respective   1/5%ZRXOGQRWDVVHUWMXULVGLFWLRQRYHUDQHPSOR\HUZKLFK
judgments in our federal system of governance. See Ruhrgas        ZDV D QRQSURILW 0LFKLJDQ FRUSRUDWLRQ SURYLGHU RI JURXS
AG v. Marathon Oil Co., 526 U.S. 574, 586 (1999)("Most            KRPHV IRU PHQWDOO\ GLVDEOHG SHUVRQV DQG ZKLFK KDG
essentially, federal and state courts are complementary           FRQWUDFWHG ZLWK WKH 0'0+ WR SURYLGH VHUYLFHV WR WKHVH
systems for administering justice in our Nation. Cooperation      SHUVRQV  $SSO\LQJ 1DWLRQDO 7UDQVSRUWDWLRQ WKH GLUHFWRU
and comity, not competition and conflict, are essential to the    IRXQGDVIROORZV
federal design.") However, "comity," in this sense, is not
limited to the recognition of judicial acts. See Calderon v.          7KXV WKH (PSOR\HU PD\ EH FRQVLGHUHG WR EH
Thompson, 523 U.S. 538, 552 (1998) ("Comity is not limited          WDQWDPRXQWWRDQDGPLQLVWUDWLYHDUPRIWKHJRYHUQPHQW
to the judicial branch of a state government.") As used in the      DQGQRWZLWKLQWKHGHILQLWLRQRI>86&@,Q
present context, "comity" refers to the Board’s recognition of      DGGLWLRQ WKH FRQWURO SRVVHVVHG DQG H[HUFLVHG RYHU WKH
state agency proceedings. This use of "comity" was cogently         (PSOR\HU
VRSHUDWLRQVE\WKH6WDWHRI0LFKLJDQPDNHV
explained by the Second Circuit in Long Island College              PHDQLQJIXO FROOHFWLYH EDUJDLQLQJ LPSRVVLEOH   
                                                                    $FFRUGLQJO\DVWKH%RDUGGRHVQRWKDYHMXULVGLFWLRQRYHU
Hospital v. NLRB, as follows:                                       WKHHPSOR\HU,VKDOOGLVPLVVWKHSHWLWLRQ
  "Comity" is a notion of highly uncertain content. The           &.+RPHVDW$-$DWResidential Sys. v. UAW, an
  Board refers us to the statement in Mast, Foos & Co. v.         unpublished decision of the NLRB Seventh Region Director,
  Stover Mfg. Co., 177 U.S. 485, 488-89, 20 S.Ct. 708,            decided April 7, 1988 (Case No. No. 7-RC-18529) (J.A. at
  710, 44 L.Ed. 856 (1900), that                                  274-82).
     Comity is not a rule of law, but one of practice,
     convenience and expediency . . . (which) has a
     substantial value in securing uniformity of decision,            DQ\RQH DFWLQJ LQ WKH FDSDFLW\ RI RIILFHU RU DJHQW RI VXFK ODERU
     and discouraging repeated litigation of the same                 RUJDQL]DWLRQ
     question . . . its obligation is not imperative. . . .
                                                                   86&   HPSKDVLV DGGHG 6HH 3LNHYLOOH   8QLWHG 0HWKRGLVW
     Comity persuades; but it does not command. It                +RVS Y 86:  )G   WK &LU 
   0LFK&RPPXQLW\6HUYV         1RV       1RV                0LFK&RPPXQLW\6HUYV           
     HWDOY1/5%                                                                                              HWDOY1/5%

  Subsequently, in Res-Care, Inc., 280 NLRB 670 (1986), the         U.S.C. 152(2) ] of the Act, and whether such employer
NLRB reaffirmed the basic test set forth in National                meets the applicable monetary jurisdictional standards.
Transportation, but clarified the latter prong of that test:
                                                                  0JPW7UDLQLQJ317 NLRB at 1358. See Pikeville United
  In applying [the National Transportation] test, however,        Methodist Hosp. v. USW, 109 F.3d 1146 (6th Cir. 1997)
  we will examine closely not only the control over               (holding that, under Management Training, the NLRB’s
  essential terms and conditions of employment retained by        jurisdiction was established over a hospital by showing that
  the employer, but also the scope and degree of control          the hospital was an "employer" as defined by the NLRA, even
  exercised by the exempt entity over the employer's labor        though the hospital was subject to some local governmental
  relations, to determine whether the employer in issue is        control); Aramack Corp. v. NLRB, 179 F.3d 872 (10th Cir.
  capable of engaging in meaningful collective bargaining.        1999).
Res-Care, 280 NLRB at 672. On July 28, 1995, the NLRB             Case No. 00-2192: MCS’ Petition
issued its decision in Management Training, overruling the
Res-Care test and expanding its jurisdiction to include certain      In this case, we review de novo the Board’s legal
private employers who have close ties to exempt                   conclusions regarding whether comity should be extended to
governmental entities:                                            the MERC-conducted elections held before and after the
                                                                  issuance of Management Training, and its findings of fact
  In Res-Care, the Board held that, in deciding whether it        under the substantial evidence standard. Harborside
  would assert jurisdiction over an employer with close ties      Healthcare, Inc. v. NLRB, 230 F.3d 206, 208-09 (6th Cir.
  to an exempt government entity, it would examine the            2000); United Parcel Serv., Inc. v. NLRB, 228 F.3d 772, 774-
  control over essential terms and conditions of                  75 (6th Cir. 2000).
  employment retained by both the employer and the
  exempt entity to determine whether the employer in issue           As a legal doctrine, comity originally emerged in the
  is capable of engaging in meaningful collective                 context of international law to reflect the recognition by one
  bargaining. 280 NLRB at 672. After careful                      state or nation of the laws, policies and judicial acts of
  consideration of Res-Care and its progeny and for the           another. See BLACK’S LAW DICTIONARY, 261-62 (7th ed.
  reasons set forth below, we have decided that the test set      1999) ("The comity principle is most accurately characterized
  forth in Res-Care is unworkable and unrealistic. Rather,        as a golden rule among nationsthat each must give the
  we think that whether there are sufficient employment           respect to the laws, policies and interests of others that it
  matters over which unions and employers can bargain is          would have others give to its own in the same or similar
  a question better left to the parties at the bargaining table   circumstances.")(quoting Thomas Buergenthal & Harold G.
  and, ultimately, to the employee voters in each case.           Maier, Public Int’l Law in a Nutshell 178 (2d ed. 1990)). As
                             ***
  [I]n determining whether the Board should assert                      
  jurisdiction, the Board will only consider whether the                  $V SRLQWHG RXW LQ   0DQDJHPHQW 7UDLQLQJ   ³6HF  H[FOXGHV IURP
                                                                  WKH   WHUP µHPSOR\HU¶ ERWK )HGHUDO DQG VWDWH JRYHUQPHQWDO HQWLWLHV DV ZHOO
  employer meets the definition of "employer" under [29           DV µSROLWLFDO VXEGLYLVLRQV WKHUHRI¶´  1/5% DW  Q