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International Union v. National Labor Relations Board

decided: April 16, 1984.

INTERNATIONAL UNION, UNITED AUTOMOBILE, AEROSPACE & AGRICULTURAL IMPLEMENT WORKERS OF AMERICA, AND ITS LOCAL NO. 1712, PETITIONER,
v.
NATIONAL LABOR RELATIONS BOARD, RESPONDENT, AND SUN ELECTRIC CORPORATION & PETER DIEDRICH, INTERVENING RESPONDENTS



On Petition for Review of an Order of The National Labor Relations Board.

Pell, Cudahy, and Posner, Circuit Judges.

Author: Cudahy

CUDAHY, Circuit Judge.

On January 19, 1983, the National Labor Relations Board (the "NLRB" or the "Board") affirmed an Administrative Law Judge's dismissal of a complaint against Sun Electric Corporation ("Sun"). Petitioner, International Union, United Automobile, Aerospace & Agricultural Implement Workers of America, and its Local No. 1712 (the "Union") claims that the NLRB's decision is not supported by substantial evidence. The Union also asserts that the NLRB failed to address certain key issues in the case. Finding ample legal and factual support for the NLRB's decision, we deny the petition for review.

I.

The Union claims that Sun refused, in 1980, to bargain in good faith over pension proposals submitted by the Union in 1979, allegedly in violation of § 8(a)(5) of the National Labor Relations Act (the "Act"), 29 U.S.C. § 158(a)(5).*fn1 To understand the events leading up to this dispute we must recount the negotiations over the 1977-80 labor agreement between Sun and the Union.

Sun manufactures auto parts at 65 facilities nationwide, employing approximately 2500 people. At all times material to this case, the Union represented about 300 employees at Sun's Crystal Lake, Illinois, facility. These employees historically were covered by Sun's company-wide pension plan, but during the 1977 contract renewal negotiations, the Union made proposals to improve the pension plan. Sun, for several reasons, was unwilling to consider the Union's 1977 proposals. Sun had, apparently, recently completed a review and a revision of its pension plan to bring it into compliance with the Employee Retirement Income Security Act of 1974, 29 U.S.C. §§ 1001 et seq. Further, Sun feared that if it took the necessary time to review the Union's proposals, it would delay reaching an agreement on the contract as a whole. So, in response to the Union's proposals, Sun proffered the following Side Letter, which was designed to ensured that the parties would have adequate time to bargain over pensions in 1980. The Side Letter also, and very importantly, makes any changes in benefits retroactive to the effect date of the 1977 contract:

The parties agree to consider changes to the Pension Plan at the termination of the Agreement in November 1980. The Union agrees to notify the Company of desired changes twelve (12) months prior to the expiration of the 1980 Contract and Company agree [sic] that any changes negotiated at that time will retroactively affect any employee who retires or first receives benefit payments during the term of this new Agreement.

In July, 1979, the parties once again began corresponding over the Union's desire to improve pension benefits for its members. On July 23, Roy Dahlke, the Union's chief negotiator, wrote to Sun's personnel director, stating that he wanted to meet with management to discuss the pension plan. Peter Shukas, the personnel director, replied on July 25, asked that any pension proposals be directed to him in writing and further stated that these written proposals would be forwarded "to the Sun Pension Committee for study and review." Thereafter, on August 6, 1979, Dahlke submitted, for Sun's study, sixteen proposals which he characterized as "major points that need correction as soon as possible." The August 6 letter specifically reserved "the final right to determine what [the Union's] Pension Proposals might be in the 1980 negotiations." The Union apparently very much concerned with preserving its right to change the proposals because the letter further stressed: "the very clear understanding that this [proposal] does not preclude the Union from any Pension Proposals, it might make in 1980." On September 20, 1979, Dahlke again wrote to Shukas and added one additional pension proposal. Shukas, meanwhile, turned the proposals over to Henry Stark, Sun's chief negotiator. Stark decided to do nothing with the proposals, nor did he have them studied to determine feasibility or cost. Further, he did not inform the Union of the decision to take no action on the proposals.

On September 30, 1980, more than a year after Sun had received the Union's pension proposals, bargaining for a new contract began. The Union submitted a comprehensive written proposal which incorporated the previously made pension proposals. At some time between September 30 and October 13, Stark mentioned to the company Sun had hired to conduct a comprehensive review of its pension program some of the Union's pension proposals. On November 5, Sun submitted a comprehensive contract proposal which effectively rejected all of the Union's proposals and modified the old contract only to the extent that it would have allowed Sun to unilaterally modify the existing pension plan. On November 12, Stark informed the Union that it needed flexibility with regard to pensions because the entire pension plan was under review. Dahlke became angry, apparently because he foresaw a repetition of Sun's 1977 reluctance to bargain over pensions.*fn2 Dahlke reiterated the Union's sixteen point proposal and at this time Sun agreed to six of the points, partially agreed to two more, rejected one and agreed to cost out seven others.

The next negotiating session occurred two days later on November 14. Sun made a new contract proposal which the Union rejected. The Union countered with a proposal for a six-month extension of the existing contract with continued bargaining over four specific issues, including pensions. Sun rejected this offer and offered a new proposal which the Union rejected. The Union then proposed a forty-two month extension of the current contract, which Sun rejected. The contract expired on November 17 and the Union called its members out on strike. Stark testified that at this time actuarial work on the Union's pension proposals was halted because he viewed the Union's offer to extend the existing contract as a withdrawal of the earlier pension proposals. A study of the sixteen points was finally completed on February 11, 1981, after they were resubmitted to Sun's actuaries pursuant to a Union proposal made during the strike.

Meanwhile, in September and October, 1979, Aetna Life Insurance Company, carriers of Sun's pension plan, advised Sun to make certain changes in the plan. Sun agreed to make only those changes that its attorneys found were required by federal law. The amendments were executed on October 30, 1980.

On July 23, 1981, the regional director of the NLRB filed a complaint against Sun, alleging that between September 30, 1980 and a "certain but unknown date in 1981," Sun refused to bargain in good faith by failing to respond to the Union's pension proposals. The complaint was later amended to include allegations that the strike was an unfair labor practice strike and that the failure to reinstate the strikers when the strike ended was an unfair labor practice. The complaint was tried to an Administrative Law Judge ("ALJ") ...


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