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Lineback v. Irving Ready-Mix

August 5, 2011

RIK LINEBACK, REGIONAL DIRECTOR OF THE TWENTY-FIFTH REGION OF THE NATIONAL LABOR RELATIONS BOARD, FOR AND ON BEHALF OF THE NATIONAL LABOR RELATIONS BOARD, PETITIONER-APPELLEE,
v.
IRVING READY-MIX, INC., RESPONDENT-APPELLANT.



Appeal from the United States District Court for the Northern District of Indiana, Fort Wayne Division. No. 1:10-cv-00346-JD-RBC--Jon E. DeGuilio, Judge.

The opinion of the court was delivered by: Hamilton, Circuit Judge.

ARGUED JUNE 9, 2011

Before MANION, WOOD, and HAMILTON, Circuit Judges.

The district court issued an injunction under section 10 (j) of the National Labor Relations Act, 29 U.S.C. § 160(j), ordering respondent Irving Ready-Mix, Inc. to stop certain unfair labor practices pending a final administrative decision by the National Labor Relations Board. Irving Ready-Mix has appealed, but we find no error or abuse of discretion by the district judge. We affirm.

I. Factual and Procedural Background

Respondent Irving Ready-Mix, Inc. sells, delivers, and installs ready-mix concrete from its five plants in northern Indiana. For many years, the ready-mix concrete truck drivers employed by Irving Ready-Mix have been represented by the Chauffeurs, Teamsters & Helpers, Local Union No. 414, a local of the International Brotherhood of Teamsters. A collective bargaining agreement was in effect from June 1, 2005 through May 31, 2010.

As the agreement's expiration date neared, the union and management met to negotiate a new agreement. The employer insisted that a new agreement would have to allow it to reduce its total labor costs (wages plus benefits) from approximately $43.00 per hour to about $31.00 per hour. The union refused, management stuck to its position, and the old agreement expired on May 31, 2010 without a replacement. The drivers went on strike on June 1st.

The employer then took the actions at the center of this lawsuit. It announced that it no longer recognized the union as the drivers' collective bargaining representative. Instead, it contacted the drivers directly, offering to employ them individually on new terms consistent with management's last offer. A few drivers resigned from the union and returned to work, including one member of the union's bargaining committee. The strike ended on July 19, 2010, and more drivers returned to work at the lower wage rates and on terms less favorable than those of the old collective bargaining agreement.

The union filed charges of unfair labor practices with the National Labor Relations Board. The charges relevant to this appeal all stem from the employer's refusal to recognize the union after the old collective bargaining agreement expired, despite the absence of evidence that the union had lost support of a majority of the drivers. An administrative law judge heard evidence from the parties on September 29 and 30, 2010. The next week, on October 5, 2010, NLRB regional Director Rik Lineback filed this petition in the district court seeking a section 10(j) injunction pending a final decision by the Board.

Before the district court ruled on the injunction request, the ALJ issued a decision finding that all but one of the unfair labor practice charges had merit. First, the ALJ determined that the employer was subject to the unfair labor practices restrictions of the National Labor Relations Act (NLRA) as a result of the type of collective bargaining agreement it held with the union. Second, the ALJ concluded that the employer violated two of those restrictive provisions. We elaborate briefly on the ALJ's conclusions.

In the first step of his analysis, the ALJ found that the employer's collective bargaining agreement with its employees was made pursuant to section 9(a) of the NLRA, 29 U.S.C. § 159(a). Under this section, a union chosen for purposes of collective bargaining by the majority of employees in a unit is considered the exclusive representative for negotiating conditions of employment. Other provisions of the Act prohibit practices that interfere with this section 9(a) relationship. The relevant provision here is section 8(a), which prohibits unfair practices by the employer. See NLRA § 8(a)-(b), (d); 29 U.S.C. § 158(a)-(b), (d).

To avoid this result, the employer argued that its relationship with the union was governed not by section 9(a) but by section 8(f), under which it would have been excepted from the restrictions of section 8(a). Section 8(f) of the NLRA allows an employer "engaged primarily in the building and construction industry" to enter into a collective bargaining agreement with a union before the union has established majority status.*fn1 See 29 U.S.C. § 158(f). As a result of this special situation, section 8(f) agreements are not subject to the full set of unfair labor practices restrictions like traditional section 9(a) agreements. Under section 8(f), the employer's unilateral termination of recognition after expiration of the collective bargaining agreement would have been permitted. The ALJ rejected the employer's argument, relying on Board precedents that ready-mix concrete employers are not "engaged primarily in the building and construction industry" within the meaning of section 8(f).

The ALJ also noted that the employer's agreement with the union exhibited "no evidence" that it was a section 8(f) agreement. The employer and the union had entered into at least four consecutive five-year contracts. Those contracts allowed new employees thirty days to join the union, rather than the seven days permitted in contracts under section 8(f). Further, the drivers' employment with the employer was stable and longterm, not the sporadic and site-specific work that characterizes many construction jobs for which section 8(f) was designed. Concluding that section 9(a) controlled the parties' relationship, the ALJ then found that the employer violated subsections 8(a)(1) and 8(a)(5) by communicating directly with the drivers during the strike and unilaterally changing the terms of the drivers' employment.

A few weeks later, on January 28, 2011, the district court granted the Director's motion for a preliminary injunction pending a final decision by the Board. The court ordered the employer to recognize the union as the drivers' exclusive collective bargaining representative; to restore wages, benefits, and working conditions to what they had been under the old collective bargaining agreement; and, to stop dealing directly ...


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