Long Island Head Start Child Development Services

National Labor Relations Board - Board Decisions

Sep 25, 2009

354 N.L.R.B. 684 (N.L.R.B. 2009)

354 NLRB No. 82
NOTICE: This opinion is subject to formal revision before publication in the
bound volumes of NLRB decisions. Readers are requested to notify the Ex-
ecutive Secretary, National Labor Relations Board, Washington, D.C.
20570, of any typographical or other formal errors so that corrections can
be included in the bound volumes.
Long Island Head Start Child Development Services,
Inc. and District Council 1707, Local 95, Ameri-
can Federation of State, County and Municipal
Employees, AFL–CIO. Case 29–CA–26343
September 25, 2009
SUPPLEMENTAL DECISION AND ORDER
BY CHAIRMAN LIEBMAN AND MEMBER SCHAUMBER
Background
On September 29, 2005, the Board issued its Decision
and Order in this proceeding.1 The Board held that the
Respondent violated Section 8(a)(1) and (5) of the Act
by unilaterally changing its health insurance carrier and
plan on June 1, 2004. The Board found that, by entering
into negotiations for a successor collective-bargaining
agreement, the parties forestalled the automatic renewal
of their existing agreement, despite the absence of any
manifestation of the contractually-required notice of in-
tent to terminate. Because the management-rights clause,
which entitled the Respondent to make changes in insur-
ance benefits unilaterally, did not survive the expiration
of the contract, the Board found that it did not privilege
the Respondent’s action.
Subsequently, the Respondent filed a petition for re-
view of the Board’s Order with the United States Court
of Appeals for the Second Circuit, and the Board cross-
petitioned for enforcement. On August 9, 2006, the court
remanded the proceeding to the Board. Long Island
Head Start Child Development Services v. NLRB, 460
F.3d 254 (2d Cir. 2006). The court found that the prece-
dent on which the Board relied held only that negotia-
tions forestalled automatic renewal when the contractual
notice was untimely or improper in form.2 The court
held that this precedent did not apply when the required
notice was lacking entirely and that the Board had not
adequately explained a rationale for extending the prece-
dent to such circumstances.
By letter dated March 14, 2007, the Board notified the
parties that it had accepted the remand. On October 14,
2008, the Board issued a notice and invitation to the par-
ties and interested amici to file briefs in this proceeding.

1 345 NLRB 973 (2005).
2 The Board relied on Ship Shape Maintenance Co., 187 NLRB 289
(1970); Lou’s Produce, Inc., 308 NLRB 1194, 1200 fn. 4 (1992), enfd.
21 F.3d 1114 (9th Cir. 1994); Big Sky Locators, Inc., 344 NLRB 257
(2005); and Drew Div. of Ashland Chemical Co., 336 NLRB 477, 481
(2001).
The notice stated that briefs were to respond to specific
questions pertaining to the issues raised by the court.
These questions addressed the implications, in terms of
policies under the Act and sound collective-bargaining
practices, of a rule that engaging in negotiations consti-
tutes a waiver of the contractual notice requirement and
prevents automatic renewal. Thereafter, the General
Counsel, the Charging Party, and the Respondent filed
briefs on remand.
Positions of the Parties
The General Counsel, in his brief, urges the Board to
affirm its previous conclusion that the Respondent’s uni-
lateral changes were unlawful. Rather than addressing
the questions posed by the Board regarding the effect of
bargaining on the contractual notice requirement, how-
ever, the General Counsel presents a new theory in sup-
port of this result. The General Counsel maintains that
the Board and court premised their analyses on the erro-
neous assumption that the parties’ 1998–2001 collective-
bargaining agreement had automatically renewed for
successive 1-year periods through May 4, 2004. Accord-
ing to the General Counsel, the 1998–2001 agreement
never automatically renewed and instead expired at the
end of its initial term on May 4, 2001. The General
Counsel urges the Board to rely on the parties’ course of
conduct between the contract’s 2001 expiration and the
Respondent’s June 1, 2004 unilateral change, and not
merely on their negotiations, in finding that no collec-
tive-bargaining agreement was in effect to privilege the
Respondent’s action.
The General Counsel maintains that the parties’ con-
duct during 2001–2004 shows a mutual understanding
that the 1998–2001 contract had terminated. The Gen-
eral Counsel asserts that the parties treated the contract as
having expired and that the Respondent had never before
claimed that it remained effective. The General Counsel
further contends that the parties began bargaining for a
successor agreement as early as 2001, continuing until
they reached a Memorandum of Agreement (MOA) on
April 22, 2004. Moreover, he argues that the MOA itself
demonstrates an understanding that the prior agreement
had expired. In the General Counsel’s view, the MOA
created a collective-bargaining agreement retroactive to
2001, which would have been unnecessary if the previ-
ous contract had rolled over since that time.
The General Counsel next argues that the MOA ex-
pressed the parties’ intent that the retroactive contract
terminate on May 4, 2004. In support of this view, the
General Counsel notes that the MOA called for bargain-
ing for a successor agreement to commence “as soon as
practicable,” even though, when the parties signed the
DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD2
MOA, the contractual deadline for notice of termination
had already passed.
Finally, the General Counsel points out that the requi-
site ratification of the MOA by both parties had not oc-
curred at the time of the unilateral change. The Union
notified the Respondent of ratification by the unit em-
ployees on May 18, 2004, and the Respondent’s board of
directors did not ratify it until June 28, 2004. Therefore,
the General Counsel maintains that the prior contract had
expired and the provisions of the MOA had not taken
effect when the Respondent implemented the insurance
plan changes.
Like the General Counsel, the Union declined to re-
spond to the questions posed by the Board in the invita-
tion to file briefs. The Union agrees with the General
Counsel’s contention that the 1998–2001 contract ex-
pired at the end of its initial term, after which the parties
bargained for a successor agreement. Additionally, the
Union argues that the MOA’s provision that the parties
would begin negotiations “as soon as practicable” consti-
tuted an explicit waiver of any notice and that the parties
agreed to this waiver because compliance with the dead-
line for notice was impossible when the parties executed
the MOA. The Union also asserts that the parties’ sub-
sequent negotiations further show that they had notice of
intent to modify the contract and, in fact, did so.
The Respondent, by contrast, cites the court’s finding
that the parties did not dispute that the 1998–2001 con-
tract renewed automatically in 2001, 2002, and 2003.
The Respondent maintains that the contract modifica-
tions implemented by the MOA were retroactive only
from the date of execution until the May 4, 2004 expira-
tion date of the existing contract.3 The Respondent
maintains that, in the absence of notice, the contract re-
newed again on May 4, 2004. Moreover, in the Respon-
dent’s view, by finding that bargaining waives the con-
tractual notice requirement, the Board would improperly
interfere with the parties’ agreement and would dissuade
parties from entering into negotiations after the deadline
for notice had passed. Accordingly, the Respondent
submits that bargaining should have no effect on contract
renewal.
Discussion
We accept the court’s decision as the law of the case,
and we have reviewed the record and briefs on remand in

3 The Respondent also asserts that bargaining for a successor agree-
ment began in 2003 and that no party argues that those negotiations
prevented the renewal of the contract. Although the Board and court
found that negotiations began in 2003, the date on which bargaining
began does not affect our conclusion, in light of the court’s finding that
the contract remained in effect through at least May 4, 2004.
light of that decision.4 For the reasons set forth below,
we reverse our prior decision and find that the Respon-
dent’s unilateral changes of insurance carrier and plan
were lawful under Section 8(a)(1) and (5).
Treating the court’s remand as the law of the case, we
accept its determination that extant Board precedent does
not resolve the question presented in this proceeding.
Therefore, unless we extend the precedent or find on
another basis that the contract terminated, we must con-
clude that the parties’ agreement automatically renewed
for an additional year beginning May 4, 2004, and that
the Respondent’s June 1, 2004 changes were privileged.
Through the invitation to file briefs, the Board pro-
vided the parties and interested amici an opportunity to
address the legal issue of whether we should find con-
tract termination based on bargaining even in the absence
of any contractually required notice. The Respondent
urges the Board not to rely on bargaining by the parties
as a demonstration of intent to terminate. Neither the
General Counsel nor the Union has responded to the
questions posed by the Board. Instead, the General
Counsel proffers, as an alternative rationale for finding
that a collective-bargaining agreement was not in effect
when the Respondent unilaterally changed its health in-
surance carrier and plan, a theory which is substantially
precluded by the court’s decision. The General Counsel
predicates his proposed analysis on the central contention
that the parties’ 1998-2001 contract expired at the end of
its initial term. However, the court found it undisputed
that the agreement renewed automatically and was effec-
tive through at least May 4, 2004. That finding stands as
the law of the case. Therefore, we reject the General
Counsel’s assertions that the contract expired in 2001
and that the parties’ conduct demonstrated their mutual
understanding of that termination.
Furthermore, the General Counsel argues that the par-
ties mutually intended that the contract modifications in

4 Effective midnight December 28, 2007, Members Liebman,
Schaumber, Kirsanow, and Walsh delegated to Members Liebman,
Schaumber, and Kirsanow, as a three-member group, all of the Board’s
powers in anticipation of the expiration of the terms of Members Kir-
sanow and Walsh on December 31, 2007. Pursuant to this delegation,
Chairman Liebman and Member Schaumber constitute a quorum of the
three-member group. As a quorum, they have the authority to issue
decisions and orders in unfair labor practice and representation cases.
See Sec. 3(b) of the Act. See Snell Island SNF LLC v. NLRB, 568 F.3d
410 (2d Cir. 2009), petition for cert. filed __U.S.L.W.__ (U.S. Septem-
ber 11, 2009) (No. 09-328); New Process Steel v. NLRB, 564 F.3d 840
(7th Cir. 2009), petition for cert. filed 77 U.S.L.W. 3670 (U.S. May 22,
2009) (No. 08-1457); Northeastern Land Services v. NLRB, 560 F.3d
36 (1st Cir. 2009), petition for cert. filed 78 U.S.L.W. 3098 (U.S. Au-
gust 18, 2009) (No. 09-213). But see Laurel Baye Healthcare of Lake
Lanier, Inc. v. NLRB, 564 F.3d 469 (D.C. Cir. 2009), petitions for re-
hearing denied Nos. 08-1162, 08-1214 (July 1, 2009).
LONG ISLAND HEAD START CHILD DEVELOPMENT SERVICES 3
the April 22, 2004 MOA would expire on May 4, 2004.
In support of that contention, the General Counsel cites
the MOA’s provision that the parties would commence
negotiations for a successor agreement as soon as practi-
cable and the impossibility, even on the date of the
MOA, of providing timely notice of termination. Neither
of these facts is plainly inconsistent with automatic roll-
over under the provisions of the 1998 contract and the
modifications prescribed in the MOA. Contrary to the
General Counsel, we do not find that this scant evidence
warrants an inference that the parties intended to forestall
automatic renewal, so that no contract would exist after
May 4, 2004. Therefore, this argument is also unavail-
ing.
Because the General Counsel and Charging Party have
failed to address, as requested in the invitation to file
briefs, the legal issue of whether bargaining alone should
be sufficient to constitute a waiver of any expression of
the contractually required notice of termination, we de-
cline to resolve that issue in this proceeding.
Conclusion
In view of the court’s determination that Board prece-
dent does not establish that the parties, by engaging in
bargaining, waived entirely the notice requirement for
contract termination, and the General Counsel’s failure to
propose an alternative theory concordant with the law of
the case, we conclude that the parties’ contract, including
the management-rights clause, remained in effect and
that the Respondent acted lawfully by exercising the dis-
cretion provided by the contract. Therefore, we dismiss
the complaint.
ORDER
The complaint is dismissed.
Dated, Washington, D.C. September 25, 2009
Wilma B. Liebman, Chairman
Peter C. Schaumber, Member
(SEAL) NATIONAL LABOR RELATIONS BOARD