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Impact Industries Inc. v. National Labor Relations Board

decided: May 18, 1988.


On a Petition to Review and Set Aside a Decision of the National Labor Relations Board and Cross Petition for Enforcement. Nos. 33-CA-4847, 5177 and 5186 and 33RC-2608.

Bauer, Chief Judge, Cummings, and Kanne, Circuit Judges.

Author: Kanne

KANNE, Circuit Judge.

Petitioner, Impact Industries, Inc. ("Impact") requests this court to review and set aside an order by the National Labor Relations Board (the "Board") upholding findings that Impact engaged in unfair labor practices and ordering Impact to reinstate certain employees and to bargain with the UAW. The NLRB has cross-petitioned for enforcement of the bargaining order. Although we choose not to disturb the Board's factual findings that Impact committed unfair labor practices in violation of the National Labor Relations Act ("NLRA"), we decline to enforce the Board's bargaining order and remand the case to the Board for further consideration in light of substantial changes occurring in the intervening years affecting both Impact's management and its work force.

A condensed version of the facts are that the UAW began an organizational drive at Impact's plant in Sandwich, Illinois in 1980. As a result of the UAW's efforts, 106 of the 118 plant employees signed valid authorization cards indicating a desire to bargain with the UAW. The UAW then requested that Impact management meet and bargain with the union. Eventually, because Impact refused to bargain on the basis of the authorization cards, the union filed a petition to conduct a representation election in May, 1980.

In the two months before the scheduled election, Impact's management conducted a vigorous anti-union campaign which included threats of a plant closure, threats of discharge, termination of benefits, the institution of new benefits by Impact, and close supervision of union activities.

On May 16, 1980, the union lost the election by a narrow vote of 59 to 49. The union then filed unfair labor practice charges against Impact alleging Impact's anti-union/pro-company campaign violated several provisions of the NLRA.

Even after the charges were filed, Impact continued to violate the NLRA by firing some of the employees who had been instrumental in the union drive. Impact claimed the firings were based on the employees' questionable alien status. These actions resulted in additional charges by the union against Impact.

All the union's charges were eventually heard by an administrative law judge ("ALJ") in February, 1981. On March 25, 1982, nearing a year after the extensive administrative hearing was concluded, the ALJ determined that Impact had committed a number of egregious unfair labor practices. The ALJ then entered a Gissel bargaining order*fn1 whereby Impact was required to bargain with the union without either a second representation election or a rerun election. The ALJ reasoned that Impact's violations could not be rectified by traditional remedies and that Impact's practices in 1980 had so tainted the work place that a bargaining order was the only viable remedy.

The company appealed to the National Labor Relations Board, challenging both the ALJ's factual findings and the imposition of the bargaining order. The Board, for reasons known only to itself, did not rule on the appeal for nearly five and one-half years. When the Board did issue its decision on July 30, 1987 (amended on September 3, 1987), it modified the ALJ's factual findings only slightly. The Board also enforced the Gissel bargaining order but clarified that this was a Gissel II order; that is, an order based on less egregious, but nevertheless numerous violations of the NLRA.

During the course of the entire administrative proceeding, Impact attempted to submit additional evidence three times, twice by filing motions with the ALJ, and once on August 21, 1987, by filing a post-decision Motion to Reopen and Reconsider with the Board. In all its motions, Impact pointed out that its work force had experienced almost a 90% turnover and that totally new management (unrelated to the original owners) had taken over. Impact argued that as a consequence of these changes which had occurred over the intervening seven and one-half years since the election, the outcome of a second representation election was no longer predictable and a Gissel bargaining order was unnecessary.

Both the ALJ and the Board refused to consider Impact's newly submitted evidence. The ALJ found the evidence to be immaterial and on September 30, 1987, the Board denied Impact's motion to reconsider simply refusing to consider the proffered evidence.

On appeal, we are constrained to accept the ALJ's factual findings, which include his credibility determinations, and the Board's adoption of those findings unless "exceptional circumstances" warrant a reversal. NLRB v. Berger Storage & Transfer Co., 678 F.2d 679, 687 (7th Cir. 1978). In Berger we explained:

Credibility determinations, including assessments of demeanor, are to be made by the ALJ and the Board . . . to the extent that the ALJ's decision rests explicitly on his evaluation of demeanor, the Board and a reviewing court are required to 'weigh those particular findings more heavily.' [Kopack v. NLRB, 668 F.2d 946, 954 (7th Cir. 1982)]. Moreover, explicit credibility findings are unnecessary when the ALJ implicitly resolves conflicts ...

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