United States Court of Appeals, District of Columbia Circuit
February 10, 2017
Petition for Review and Cross-Application for Enforcement of
an Order of the National Labor Relations Board
W. Marr argued the cause for petitioner. With him on the
briefs was Megumi Sakae.
Casserly, Attorney, National Labor Relations Board, argued
the cause for respondent. On the brief were Richard F.
Griffin, Jr., General Counsel, John H. Ferguson, Associate
General Counsel, Linda Dreeben, Deputy Associate General
Counsel, Usha Dheenan, Supervisory Attorney, and Marci J.
A. Rosenfeld argued the cause and filed the brief for
intervenor International Brotherhood of Boilermakers Local
627 in support of respondent. Caren P. Sencer entered an
Before: Rogers and Millett, Circuit Judges, and Sentelle,
Senior Circuit Judge.
ROGERS, CIRCUIT JUDGE
8(f) of the National Labor Relations Act, 29 U.S.C. §
158(f), allows employers in the construction industry to
enter into pre-hire agreements with unions without a showing
that a majority of their employees support the union.
M&M Backhoe Serv., Inc. v. NLRB, 469 F.3d 1047,
1048 (D.C. Cir. 2006); Nova Plumbing, Inc. v. NLRB,
330 F.3d 531, 534 (D.C. Cir. 2003). Absent the usual
statutory obligation of the parties to maintain the
status quo upon expiration of their collective
bargaining agreement, until impasse or a new agreement is
reached, the Board had to determine whether the Hawaiian
Dredging Construction Company's discharge of its welders,
after their Section 8(f) agreement had expired, was motivated
by an intent to discriminate in violation of the
employees' statutory rights, or reflected the
company's long-standing business practice to rely on
union hiring halls under Section 8(f) agreements for craft
employees. The Board ruled the company violated Sections
8(a)(3) and (1) of the Act by terminating the welders because
of their union membership. The company petitions for review,
contending that the Board's analysis under its own
precedent is flawed and unsupported by substantial evidence.
Because the Board failed to adequately address record
evidence regarding the company's understanding of its
twenty-year practice and appears to have strayed from its
precedent, we grant the petition for review, deny the
Board's cross-application for enforcement of its Order,
and remand the case to the Board.
1959, Congress amended the National Labor Relations Act, to
address specific needs of the construction industry. The Act
had been "developed without reference to the
construction industry, " NLRB v. Local Union No.
103, Int'l Ass'n of Bridge, Structural and Ornamental
Iron Workers, AFL-CIO, 434 U.S. 335, 348 (1978) (quoting
H.R. Rep. No. 741, 86th Cong.,
1stSess., at 19 (1959)), and yet
"[r]epresentation elections in a large segment of the
industry [were] not feasible to demonstrate . . . majority
status due to the short periods of actual employment by
specific employers." Id. at 349 (quoting S.
Rep. No. 187, 86thCong., 1st Sess., at
55 (1959)). In order to allow an employer primarily engaged
in construction work to "know his labor costs before
making the estimate upon which his bid [for a project] will
be based, " and to ensure employers in the construction
industry "have available a supply of skilled craftsmen
ready for quick referral, " id. at 348 (quoting
H.R. Rep. 741 at 19), Congress provided, subject to
exceptions not at issue here:
It shall not be an unfair labor practice . . . for an
employer engaged primarily in the building and construction
industry to make an agreement covering employees engaged . .
. in the building and construction industry with a labor
organization of which building and construction employees are
members . . . because (1) the majority status of such labor
organization has not been established . . . or (2) such
agreement requires as a condition of employment, membership
in such labor organization . . . or (3) such agreement
requires the employer to notify such labor organization of
opportunities for employment with such employer, or gives
such labor organization an opportunity to refer qualified
applicants for such employment, or (4) such agreement
specifies minimum training or experience qualifications for
29 U.S.C. § 158(f). By contrast, under typical
collective bargaining agreements, the parties have an
obligation, upon expiration of their agreement, to bargain in
good faith and to maintain the status quo as to all
mandatory subjects of bargaining until they reach a new
agreement or an impasse. See Oak Harbor Freight Lines,
Inc. v. NLRB, No. 14-1226, 2017 WL 1556126, at *1 (D.C.
Cir. May 2, 2017) (citing, inter alia, NLRB v.
Katz, 369 U.S. 736, 743 (1962)); see also M&M
Backhoe Serv., 469 F.3d at 1048.
Dredging is the largest general contractor in the State of
Hawaii, employing around 375 craft labor employees to work on
renovation, foundation, power, and industrial projects. As a
member of the Association of Boilermakers Employers of
Hawaii, the company has performed its craft work pursuant to
Section 8(f) pre-hire collective bargaining agreements. As of
2010, such agreements had existed for at least twenty years
with the International Brotherhood of Boilermakers, Iron Ship
Builders, Blacksmiths, Forgers, and Helpers, Local 627
("Boilermakers"). The parties' latest agreement
expired on September 30, 2010.
October 1, the Boilermakers notified the company of
availability to continue negotiation, attaching a letter from
counsel that because the parties' Section 8(f) agreement
had expired its members were free to cease working without
notice. Some members of the Boilermakers refused to work that
day, but resumed work on Monday, October 4. On October 8, the
parties reached an interim agreement to extend the terms of
the expired agreement through October 29 and to make the new
collective bargaining agreement retroactive to September 30,
2010. Negotiations for a new collective bargaining agreement
continued after October 29, however, with the parties
disagreeing over inclusion of certain benefits. On November
1, 2010, the Boilermakers sent the company the terms of a ...