On Petition for Review and Cross-Application for Enforcement of an Order of the National Labor Relations Board
Before: Ginsburg, Chief Judge, and Edwards and Roberts,
The opinion of the court was delivered by: Edwards, Circuit Judge
Argued September 28, 2004
Resort Nursing Home ("Resort") and Kingsbridge Heights Rehabilitation Care Center ("Kingsbridge") petition for review of an order of the National Labor Relations Board ("NLRB" or "Board"), and the Board crossapplies for enforcement. The Board held that Resort and Kingsbridge (collectively, "the Homes") committed unfair labor practices in violation of § 8(a)(1) and (5) and § 8(d) of the National Labor Relations Act ("Act"), 29 U.S.C. § 158(a)(1), (a)(5), (d) (2000), by refusing to execute and failing to abide by a collective bargaining agreement negotiated by New York Health & Human Services Union 1199/SEIU, AFL-CIO ("Union") and the Greater New York Health Care Facilities Association ("Greater New York" or "Association"), a multiemployer association of which the Homes were members. See Resort Nursing Home, 340 N.L.R.B. No. 77 (Sept. 30, 2003) ("Decision"), reprinted in Joint Appendix ("J.A.") at 760, available at 2003 WL 22287369. In reaching this conclusion, the Board found that the Homes were bound by the collective bargaining agreement arrived at through multiemployer bargaining, because their attempted withdrawal from the multi-employer bargaining unit was legally ineffective.
Under Retail Associates, Inc., 120 N.L.R.B. 388 (1958), withdrawal from multi-employer bargaining is not permitted after the commencement of negotiations, "absent unusual circumstances." Id. at 395. In this case, the Association and the Union commenced negotiations on a new agreement, without notice to the Homes, more than eight months before the expiration of the existing contract. The Homes contend that the early commencement of negotiations justified their untimely withdrawal from the multi-employer bargaining unit. Relying on its decision in Chel LaCort, 315 N.L.R.B. 1036 (1994), the Board found no "unusual circumstances" and held that the Homes were bound by the terms of the parties' new agreement.
The Homes now seek review of the Board's decision, challenging the Chel LaCort rule as "misguided and unfair." The Homes also argue that the Board erred in rejecting their claim that the Union and the Association colluded to keep their negotiations secret from the Homes. Finally, the Homes contend that the collective bargaining agreement is not binding on them, because it was never ratified by the Association's members.
We deny the petition for review and grant the Board's cross-application for enforcement. The rule adopted in Chel LaCort is a reasonable effort by the Board to balance the competing statutory interests of voluntariness and stability in collective bargaining relationships, and we thus defer to the Board's judgment. We further hold that substantial evidence supports the Board's rejection of the Homes' claim that the Union and the Association colluded to keep the negotiations secret. Finally, reviewing the collective bargaining agreement de novo, we conclude that ratification by the Association's members was not required.
The facts of this case are fully recounted in the Board's decision, see Decision, slip op. at 1, 2-5, J.A. at 760, 761-64, so we merely summarize the most salient facts here.
Resort and Kingsbridge are nursing homes located, respectively, in Far Rockaway and the Bronx, New York. Although separate corporations, they share common ownership and control. The Union represents the registered nurses, licensed practical nurses, and para-professionals employed by the Homes, as well as those employed by other nursing homes in New York and New Jersey. The Association is a multi-employer association that provides a range of services to its members, including educational seminars, compliance review and education regarding occupational safety and health regulations, market research, legal counsel for labor grievances and arbitrations, and, most relevant for our purposes, collective bargaining.
In 1997, the Association and the Union negotiated a collective bargaining agreement that, by its terms, was to remain in effect until September 30, 2002. At that time, the Homes were members of the Association and had agreed to be bound by multi-employer bargaining between the Association and the Union.
Over time, the Homes increasingly became dissatisfied with the Association's representation. In the summer of 2000, the Homes retained their own labor counsel, Joel Cohen, to handle grievances, arbitrations, and other matters. On September 7, 2000, after the Association filed a grievance against the Union on Kingsbridge's behalf, Cohen advised the parties' permanent arbitrator (by a letter which he copied to Union and Association representatives) that he "represent[ed] Kingsbridge ... in all labor matters" and that the grievance filed by the Association "was sent without my knowledge and without Kingbridge's authorization." Although the Association objected to Cohen's letter, asserting that the Association was authorized to represent Kingsbridge with respect to the grievance, Cohen subsequently handled all of the grievances and arbitrations that arose between the Homes and the Union in 2000 and 2001.
In June and July 2001, the Homes stopped paying membership dues to the Association. On September 7, 2001, the Association demanded payment of the outstanding dues, warning the Homes: "If we do not receive payment from you by the 21st of September all services will be suspended." By December 13, 2001, the Association informed the Homes that it had instructed its staff to suspend all services to them.
Meanwhile, sometime prior to January 9, 2002 ( i.e., more than eight months before the existing collective bargaining agreement was set to expire), the Association and Union commenced bargaining on a new contract. On January 9, the Association sent a letter to the Union "confirm[ing] the intent of the Association ... to enter into an extension of the current collective bargaining agreements." The letter memorialized understandings on the principal terms and conditions for a new contract, including specific wage rates. After formal bargaining sessions on January 23 and February 1, 2002, the Union and Association entered into an agreement renewing the terms of the existing contract through April 30, 2005. The agreement provided for a wage increase to go into effect on May 1, 2002. The terms of the final agreement - including the specific wage rates - were substantially identical to the terms in the January 9 letter of intent. The agreement also listed the members of the Association, including Kingsbridge and Resort.
On January 31, 2002, upon learning of the ongoing negotiations between the Union and the Association, Kingsbridge advised the Union "that at this time Greater New York has discontinued servicing our facility, and as such, will not be negotiating on our behalf." Similarly, on February 11, 2002, Resort wrote to the Union, stating: "I am certain you are aware of the fact that the ... Association has discontinued all services for Resort. I would therefore like to remind you that [the Association] will no longer be negotiating any collective bargaining agreements on our behalf."
The Union, for its part, maintained that the Homes were bound by the terms of the new agreement. On April 24, 2004, the Union filed an unfair labor practice charge against the Homes, alleging that their refusal to ...