M.P.C Plating, Inc.

National Labor Relations Board - Board Decisions

Feb 19, 1991

301 N.L.R.B. 785 (N.L.R.B. 1991)

785
301 NLRB No. 115
M.P.C. PLATING, INC.
1 The Applicant has requested oral argument. The request is denied as the
record, exceptions, and briefs adequately present the issues and the positions
of the parties.
2 We note that the judge inadvertently stated that the amended complaint
was reissued in 1988 rather than 1987. Additionally, the Board’s decision in
Tube Craft, 287 NLRB 491, was issued December 16, 1987.
1 295 NLRB 583.
2 I regret any inconvenience the Interim Order may have caused the parties.
However, I am firmly convinced that it is far better to correct rather than per-
petuate an error in judgment.
M.P.C. Plating, Inc. and Local Union No. 507,
International Brotherhood of Teamsters,
Chauffeurs, Warehousemen and Helpers of
America, AFL–CIO. Cases 8–CA–18513(E), 8–
CA–18514(E), and 8–CA–18515(E)
February 19, 1991
DECISION AND ORDER
BY CHAIRMAN STEPHENS AND MEMBERS
CRACRAFT AND DEVANEY
On March 28, 1990, Administrative Law Judge
Arline Pacht issued the attached Supplemental Order.
The Applicant filed exceptions and a supporting brief,
the General Counsel filed an answering brief, and the
Applicant filed a reply brief.
The National Labor Relations Board has delegated
its authority in this proceeding to a three-member
panel.
The Board has considered the Supplemental Order
and the record in light of the exceptions and briefs1
and has decided to affirm the judge’s rulings, find-
ings,2 and conclusions and to adopt the recommended
Order.
ORDER
The recommended Order of the administrative law
judge is adopted and the application of the Applicant,
M.P.C. Plating, Inc., Cleveland, Ohio, for an award
under the Equal Access to Justice Act is denied.
Susan E. Fernandez, Esq., for the General Counsel.
Donald F. Woodcock, Esq. and William L. S. Ross, Esq.
(Calfee, Halter & Griswold), of Cleveland, Ohio, for the
Respondent.
SUPPLEMENTAL ORDER
Equal Access to Justice Act
Procedural Statement of Current Proceedings
ARLINE PACHT, Administrative Law Judge. On June 15,
1989, the National Labor Relations Board issued a Decision
and Order in the case.1 Thereafter, on July 14, 1989, Re-
spondent filed an application for award of fees and other ex-
penses pursuant to the Equal Access to Justice Act (EAJA),
Pub. L. 96–481, 94 Stat. 2325 and Section 102.143 et seq.
of the Board’s Rules and Regulations (Rules). On July 17,
the matter was referred to me for appropriate action. On Sep-
tember 14, counsel for the General Counsel (General Coun-
sel) filed a motion to dismiss which the Respondent an-
swered on November 3.
On January 8, 1990, based on the pleadings before me, I
issued an interim order indicating that the Respondent’s ap-
plication would be granted in part and denied in part, with
detailed findings of fact and conclusions of law to follow in
a final Supplemental Order. Specifically, I stated that the Re-
spondent had prevailed in a portion of the proceeding per-
taining to the allegations set forth in paragraph 17 of the
amended consolidated complaint, and that the General Coun-
sel failed to show that the Government’s position either was
substantially justified or that special circumstances obtained.
At the same time, I found substantial justification for the
General Counsel’s position in litigating the allegations in
paragraphs 20 and 21 of the complaint, which, together with
special circumstances, cause the award of attorney fees for
services performed in connection with that portion of the
case to be unwarranted. Pursuant to this ruling, I directed the
Applicant to submit an amended application, itemizing fees
and expenses related solely to defending against the issue
framed in paragraphs 17 to 19. The General Counsel was
granted leave to submit a response thereto.
In accordance with the Supplemental Interim Order, the
Applicant submitted a revised bill on January 19, 1990.
Thereafter, on February 6, the General Counsel filed a mo-
tion for reconsideration of the supplemental interim order
and memorandum in opposition to Respondent’s itemized fee
statement. Respondent answered on February 16 with a
memorandum in support of its amended itemized fee state-
ment and in opposition to General Counsel’s motion for re-
consideration.
After fully considering the foregoing pleadings, particu-
larly, the parties’ latest submissions, and having once again
reviewed relevant portions of the trial record, I find the Gen-
eral Counsel’s motion for reconsideration persuasive. There-
fore, contrary to my initial interim ruling, I have concluded,
for the reasons set forth below, that the Government has
demonstrated that its positions in the above-captioned case
were substantially justified.2
Background: The Unfair Labor Practice Case
A brief summary of the material facts in the underlying
unfair labor proceeding is in order. Respondent employed a
work force of approximately 30 employees in its metal plat-
ing business. Half of this number were permanent employees
on the M.P.C. payroll; the balance was obtained through
Ger-Mar Temps, an employment agency which specialized in
referrals of temporary industrial workers. On July 23, 1985,
just after learning of the employees’ union activities and after
a majority of employees had signed authorization cards, the
Respondent insisted that in order to continue working, the
members of its permanent work force would have to transfer
to the temporary employment agency with a concomitant loss
of benefits. When all but several employees refused to trans-
fer, they were denied entry to the plant. A strike ensued
which was marred by picket line misconduct. Between Au-
gust 5 and 8, the Respondent fired 11 of the strikers.
786 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
3 In addition to agreeing that the Respondent had wrongfully discharged its
permanent work force, the Board affirmed findings that the Respondent had
engaged in unlawful interrogations, directed an employee to engage in surveil-
lance, threatened to close the plant rather than accede to union representation,
and fired an employee suspected of harboring union sympathies.
4 5 U.S.C. § 504 (1988); Board’s Rules and Regulations, Sec. 102.144(a).
5 See Lathers Local 46 (Building Contractors), 289 NLRB 505 (1988), cit-
ing Tyler Business Services v. NLRB, 695 F. 2d 73 (4th Cir. 1982).
6 S. Rep. No. 253, 96th Cong. 1st Sess. 6; H.R. Rep. No. 1418, 96th Cong.
2d Sess. 16 reprinted in 5 U.S. Code Cong. & AD News 4953, 4990 (1980).
7 Board Rules, Sec. 102.144(b).
8 5 U.S. Code Cong. & Ad News 4990.
As alleged in paragraph 16 of the third amended consoli-
dated complaint, I concluded that Respondent constructively
discharged almost all its permanent employees by insisting
that they transfer to the Ger-Mar Temps payroll. Paragraphs
17, 18, and 19 of the complaint further alleged that the 15
Ger-Mar employees who were assigned to M.P.C. on or
about July 23, 1985, were denied an opportunity for full-time
permanent employment. Finding that the evidence was insuf-
ficient to prove which if any of the Ger-Mar employees was
denied an opportunity for full-time employment with the Re-
spondent, I ruled that the pertinent allegations in the com-
plaint should be dismissed.
Paragraphs 20 and 21 of the complaint further alleged that
on or about August 5, 1985, Respondent again discharged l0
of its permanent work crew because of their union activities.
The Respondent answered that the discharges were justified
by the workers’ picket line misconduct. During the course of
the hearing, the General Counsel moved to amend the com-
plaint to concede that the l0 strikers had lost their reinstate-
ment rights, but in a few instances, on dates somewhat later
than those chosen by the Respondent. In agreement with the
Respondent, I concluded that the named employees were dis-
charged for strike misconduct on or shortly after August 5.
In the absence of exceptions by the General Counsel and the
Charging Party, the rulings regarding the denial of permanent
employment and the propriety of the discharges for strike
misconduct became final.
The Board affirmed the decision below with several im-
portant modifications. Based on findings that the Respondent
had committed serious, extensive, and pervasive unfair labor
practices, the Board concluded that a bargaining order was
warranted.3 Further, the Board ordered the Respondent to re-
establish a permanent work force.
The Respondent contends that within the meaning of the
Equal Access to Justice Act, it was the prevailing party with
respect to two discrete parts of the case: (1) the allegations
in paragraphs 17 to 19 that M.P.C. unlawfully denied certain
named Ger-Mar temporary employees an opportunity for
full-time employment, and (2) the allegations in paragraphs
20 and 21 that it discharged 10 permanent employees for dis-
criminatory reasons. The General Counsel maintains that the
Government’s positions were substantially justified. Having
reconsidered the pleadings, I find merit in the General Coun-
sel’s positions.
Substantial Justification: Applicable Legal Principles
The EAJA entitles a private party who prevails against a
Federal agency, in whole or in a significant and discrete sub-
stantive portion of the proceeding, to recover its fees and ex-
penses ‘‘unless the position of the General Counsel over
which the applicant has prevailed was substantially justi-
fied.’’4 In Pierce v. Underwood, 108 S.Ct. 2541, 2550
(1988), the Supreme Court defined the test for substantial
justification to be whether the agency’s position was reason-
able in law and fact at the time the action was commenced.
In addition, in order to defeat an award, the General Counsel
must prove that its position was substantially justified with
respect to each readily identifiable stage of the proceeding.5
However, as Congress stressed when enacting EAJA, in
order to meet its burden the Government is not required to
prove that prior to trial its decision to litigate was based on
a substantial probability of prevailing.6
EAJA also provides that fees may be denied where ‘‘spe-
cial circumstances make an award unjust.’’7 Legislative his-
tory contains the following statement regarding the purpose
of this provision:
This ‘‘safety valve’’ helps to insure that the Govern-
ment is not deterred from advancing in good faith the
novel but credible extensions and interpretations of the
law that often underlie vigorous enforcement efforts. It
also gives the court discretion to deny awards where
equitable considerations dictate an award should not be
made.8
The Opportunity for Permanent Employment Issue
Respondent seeks attorney fees with respect to paragraphs
17 to 19 of the complaint which alleged, in substance, that
on or about July 23, 1985, Respondent denied named Ger-
Mar temporary employees, ‘‘the opportunity for full-time
permanent employment . . . because they joined, supported
or assisted the Union.’’
In its posttrial brief to the administrative law judge, the
General Counsel argued that the allegations of ‘‘denial of op-
portunity’’ were closely related to that portion of the case
dealing with Respondent’s attempt to transfer its permanent
work force to Ger-Mar’s payroll. The theory was that by dis-
banding the full-time work force for discriminatory motives,
the Respondent thereby denied the Ger-Mar employees any
opportunity they may have had to become full-time employ-
ees. To establish that permanent employment was a real pos-
sibility, the General Counsel adduced evidence that 8 of the
14 full-time personnel originally came from the temporary
agency. The record also showed that the Ger-Mar agency,
which had supplied industrial workers to M.P.C. since 1984,
did not oppose temporaries accepting full-time employment
after a certain number of weeks had elapsed during which
they recovered expenses.
In deciding this issue, I did not reject the ‘‘denial of op-
portunity theory’’ qua legal theory, for it did not seem unrea-
sonable then or now. Rather, the reasons for my finding that
the Respondent had not violated the Act in this instance were
twofold. First, I found that adding temporary employees to
the payroll was discretionary and depended both on the indi-
vidual employee’s skills and Respondent’s needs. Since no
evidence had been introduced to show whether any of the
Ger-Mar employees were sufficiently skilled, I concluded
that there was a lack of evidence to determine whether any
of them would have been offered permanent employment.
Second, based on unrebutted evidence, I found that Respond-
ent had instituted a hiring freeze in late June, before it
787M.P.C. PLATING, INC.
9 In its opposition to the General Counsel’s motion for reconsideration, the
Respondent did not take issue with the cited cases nor offer any contrary au-
thority.
10 Accord: National Car Rental System, 252 NLRB 159, 164, 174–175
(1980).
11 On reviewing the record, I note that 9 of the 14 Ger-Mar employees as-
signed to M.P.C. as of July 23, 1985, signed Teamsters authorization cards
on July 20 and 22. Some of the nine wrote on the cards that M.P.C. was their
employer. In addition, four or five of the Ger-Mar temporaries actively partici-
pated in strike activity. These facts could be viewed as supporting inferences
that the Ger-Mar temporaries had worked at M.P.C. long enough to feel identi-
fied with the permanent work force, that they were acceptable to the Respond-
ent, and thus, were potentially eligible to be considered for permanent employ-
ment.
12 5 U.S. Code Cong. & Ad News at 4990.
harbored suspicions that its employees were engaged in
union activity.
Regrettably, the General Counsel did not cite a single case
to support a denial of employment opportunity theory in his
posttrial brief and did not appeal my ruling on that issue to
the Board. In fact, the first time the General Counsel cited
any case to support the denial of opportunity argument was
in the instant motion for reconsideration.9 The lessons ex-
tracted from these cases now compel me to conclude that the
General Counsel’s decision to litigate the denial of oppor-
tunity issue was substantially justified in law and fact.
Service Operations Systems, 272 NLRB 1033 (1984), one
of the principal cases cited by the General Counsel, sets forth
the Board’s approach where an employer has unlawfully re-
fused to consider hiring certain employees. In that case, a
successor employer successfully bid on a janitorial services
contract but, for union-related reasons, refused to consider
any of the incumbents for employment, although they invari-
ably had been employed by predecessor contractors. Under
normal circumstances, the number and identity of incumbents
who the successor might have hired was uncertain. However,
given the employer’s discrimination, the Board concluded
that such uncertainties should be resolved against the wrong-
doer. Accordingly, the Board ordered that the respondent was
required to offer employment to all former incumbent em-
ployees by seniority, discharging other employees hired since
the date of the unlawful conduct. If insufficient positions
were available for all interested incumbents, they were to be
placed on a preferential hiring list. Id. at fn. 1.10 The Board
also agreed that, consistent with remedies in other refusal-to-
consider cases, ‘‘[f]inal determination of job availability and
possible backpay liability will be properly left to compli-
ance.’’ Ibid.
Similarly, in Alexander’s Restaurant & Lounge, 228
NLRB 165 (1977), a precedent relied on in Service Oper-
ations Systems, the Board found that the employer unlawfully
interrogated job applicants about their union attitudes and
systematically rejected anyone who appeared to harbor union
sympathies. In holding that the employer’s discriminatory
hiring practices violated Section 8(a)(3), the administrative
law judge distinguished between the wrongful act, that is, the
failure to consider an applicant for employment in a non-
discriminatory manner from the remedy for such misconduct:
Under the Act an employer must consider a request
for employment in a lawful, nondiscriminatory man-
ner, and the question whether an application has
been given such consideration does not depend on
the availability of a job at the time an application for
employment is made. [Quoting Shawnee Industries,
140 NLRB 1451, 1452–1453 (1963), enf. denied on
other grounds 333 F. 2d 221 (10th Cir. 1964).]
Therefore, ‘‘final determination of job availability and
possible backpay liability will be properly left to com-
pliance.’’ Apex Ventilating Co., Inc., 186 NLRB 534,
fn. l (1970). [Id. at 179.]
See also Dean General Contractors, 285 NLRB 573 (1987)
(determination of whether an unlawfully discharged construc-
tion worker would have been transferred to another of the re-
spondent’s sites since current project was completed, should
be resolved at compliance proceeding).
Of course, the circumstances in the present case differ
from those in the above-cited precedents. Among other
things, in the foregoing cases, the employer discriminated di-
rectly against specific, eligible individuals or a group of
workers, by failing to consider them for further employment
whereas the Ger-Mar employees, whose interest in and suit-
ability for full-time employment was unknown, could be con-
sidered indirect victims of Respondent’s discrimination
against its permanent work force. Apart from these dif-
ferences, which do not seem critical, the above-cited cases
offer reasonably close authority for the General Counsel’s
position in the underlying unfair labor practice proceeding.
They support the argument that a denial of opportunity for
permanent employment, like a failure to be considered for
employment, under the proper circumstances, may constitute
a violation of the Act. They also suggest that the General
Counsel’s failure to adduce evidence as to whether any of
the Ger-Mar temporaries could reasonably expect permanent
employment was not necessarily fatal to granting relief, since
doubts in this regard could have been resolved against the
wrongdoer. Thus, in keeping with consistent precedent, ques-
tions about which Ger-Mar employee might have been hired
absent Respondent’s discriminatory conduct, could have been
addressed at a compliance proceeding.11
The General Counsel could not anticipate what weight I
would attach to his denial of opportunity theory or Respond-
ent’s evidence concerning a June hiring freeze. Suffice to say
that reasonable minds could differ about whether the Govern-
ment proved a violation here. Moreover, in light of cases
such as Service Operations Systems, supra, the Government
surely could go one step further and reason that when the
Respondent attempted to uproot its permanent work force,
more than one-half of whom originally were referred by Ger-
Mar, it thereby foreclosed permanent employment opportuni-
ties to the temporaries then assigned to M.P.C. In these cir-
cumstances, the Government should not be ‘‘deterred from
advancing in good faith the novel but credible extension and
interpretations of the law that often underlie vigorous en-
forcement efforts.’’12 The fact that the Government did not
prevail at trial does not mean that its decision to litigate the
denial of opportunity issue was unjustified either in law or
fact.
The Strike Misconduct Issue
Paragraphs 20 and 21 of the complaint allege that on or
about August 5, 1985, the Respondent discharged 10 em-
ployees because of their union activity. The Applicant now
788 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
13 Several employees listed in par. 20 were engaged in abusive or threat-
ening conduct at various times during the strike which even under Clear Pine
Mouldings, could have provided grounds for immediate discharge. However,
in most instances, determinations of culpability turned on an assessment of
witnesses’ credibility which is the function of the administrative law judge.
14 See A.P.A. Warehouses, 291 NLRB 627, 629 (1988).
15 If no exceptions are filed as provided by Sec. 102.46 of the Board’s Rules
and Regulations, the findings, conclusions, and recommended Order shall, as
provided in Sec. 102.48 of the Rules, be adopted by the Board and all objec-
tions to them shall be deemed waived for all purposes.
seeks attorney fees for successfully proving that Respondent
discharged the strikers for picket line misconduct. Here, too,
the General Counsel moves to dismiss the request for an
award, contending that the unfair labor practice allegations
were substantially justified. I find merit in the General Coun-
sel’s contentions.
At the time the amended complaint was reissued in 1988,
Clear Pine Mouldings, 268 NLRB 1044 (1984), enfd. 765
F.2d 148 (9th Cir. 1985), was the leading case dealing with
picket line misconduct. The question in that case was wheth-
er verbal threats of physical violence and gestures intending
to instill fear of bodily harm made to a number of non-
striking employees would be sufficient to disqualify the of-
fending pickets for reinstatement. Recognizing that any pick-
eting may have a coercive aspect, the Board nevertheless de-
cided that an employer need not countenance conduct that
amounts to intimidation and threats of bodily harm. Id. at
1046. The Board announced that henceforth it would apply
the following objective test for determining whether verbal
threats by strikers justify an employer’s refusal to reinstate-
ment: ‘‘Whether the misconduct is such that, under the cir-
cumstances existing, it may reasonably tend to coerce or in-
timidate employees in the exercise of rights protected under
the Act.’’ Ibid.
Then, in Tube Craft, 287 NLRB 491 (1987), the Board
had occasion to apply the Clear Pine Mouldings standard to
picket line conduct marked by successive acts of blocking,
the principal form of strike activity in which most of the
M.P.C. employees participated. In Tube Craft, the Board
found that strikers who had blocked access to a facility over
a span of 4 days for varying periods of time ‘‘had evidenced
a strategy of refusing to limit the picketing to peaceful ap-
peals’’ and, hence, were lawfully discharged for their mis-
conduct. Id. at 493.
In concluding that the employees listed in paragraphs 20
and 21 of the complaint also were lawfully discharged for
engaging in successive acts of blocking, I relied heavily on
Tube Craft. However, the General Counsel did not have the
benefit of Tube Craft at the time the complaint was reissued
in August 1987. Under the then-prevailing Clear Pine
Mouldings standard, which dealt specifically with threats and
acts of violence, the General Counsel could fairly litigate this
issue in good faith and with a reasonable belief that episodes
of blocking were not conduct which ‘‘may reasonably tend
to coerce or intimidate employees in the exercise of rights
protected under the Act.’’13 In the absence of more definitive
authority, the General Counsel had no bright line standard by
which he could distinguish with certainty reasonable from
unreasonable conduct. The facts must be judged on a case-
by-case basis and in all but the most blatant situations, a
judgment call by the trier of fact will be appropriate.
Even after Tube Craft issued, a valid question remained as
to whether the strikers’ conduct was offset by the severity of
the Respondent’s unfair labor practices. In NLRB v. Thayer
Co., 213 F.2d 748 (1st Cir. 1954), cert. denied 348 U.S. 883
(1955), the court agreed that the Board could balance a strik-
er’s misconduct against an employer’s unfair labor practices
which provoked the strike in determining whether reinstate-
ment was appropriate. In the instant case, where the employ-
ees were enagaged in an unfair labor practice strike to protest
the Respondent’s efforts to convert them to the status of tem-
poraries with a significant loss of benefits, and where they
were locked out when they refused to transfer, and where the
Respondent had committeed numerous other unfair labor
practices, the General Counsel had cause to distrust the em-
ployer’s claim that it discharged the employees for bona fide
reasons.
Before the trial concluded, the General Counsel conceded
that most of the 10 employees listed in paragraph 20 were
validly discharged by no later than August 8, 1985. Never-
theless, counsel argued in its trial brief, that under the Thayer
doctrine, it was for the Board to decide whether under the
circumstances, reinstatement of these employees would effec-
tuate the policies of the Act. Although I did not rely on
Thayer in concluding that the listed strikers were discharged
for cause, Thayer was and continues to be good law.14 Con-
sequently, the General Counsel was substantially justified in
both fact and law in testing the propriety of the strikers’ dis-
charges.
On these findings of fact and conclusions of law and on
the entire record, I issue the following recommended15
ORDER
The General Counsel’s motion to dismiss application for
an award of fees and expenses and motion for reconsider-
ation of the supplemental interim order is granted and re-
spondent’s application for award of fees and expenses pursu-
ant to the Equal Access to Justice Act is denied.