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CPS Chemical Co., Inc. v. N.L.R.B.

November 09, 1998

CPS CHEMICAL COMPANY, INC. PETITIONER IN 97-3595
v.
NATIONAL LABOR RELATIONS BOARD, RESPONDENT OIL, CHEMICAL AND ATOMIC WORKERS INTERNATIONAL UNION, AFL-CIO INTERVENOR-RESPONDENT NATIONAL LABOR RELATIONS BOARD PETITIONER IN NO. 97-3659 OIL, CHEMICAL AND ATOMIC WORKERS INTERNATIONAL UNION, AFL-CIO INTERVENOR-PETITIONER
v.
CPS CHEMICAL COMPANY, INC. RESPONDENT



Before: Becker, Chief Judge, Weis and Garth Circuit Judges.

The opinion of the court was delivered by: Becker, Chief Judge.

On Petition for Review of Decision and Order of National Labor Relations Board and Cross-Application by NLRB for Enforcement of Its Order Board No. 22-CA-20769

Argued: September 25, 1998

OPINION OF THE COURT

CPS Chemical Company, Inc. ("CPS") petitions for review of an order of the National Labor Relations Board ("NLRB" or "Board") finding that CPS violated section 8(a)(1) and (5) of the National Labor Relations Act ("NLRA" or "Act") by refusing to recognize and bargain with Local 8-397 of the Oil, Chemical and Atomic Workers International Union ("OCAW" or "International"). The Board has cross-petitioned for enforcement of its bargaining order. CPS does not contest that it failed to recognize and bargain with Local 8-397. Rather, it argues that it was not obligated to do so because the affiliation of the independent union at CPS's Old Bridge, New Jersey, plant with Local 8-397 "resulted in such discontinuity that OCAW could not legitimately claim to represent the employees without a NLRB election to resolve the question concerning representation." Pet'r Br. at 1.

CPS relies heavily on several cases decided by this Court in the 1970s, in which we refused to enforce Board orders similar to the one at issue here. See Sun Oil Co. v. NLRB, 576 F.2d 553 (3d Cir. 1978); NLRB v. Bernard Gloekler N. E. Co., 540 F.2d 197 (3d Cir. 1976); American Bridge Div., U.S. Steel Corp. v. NLRB, 457 F.2d 660 (3d Cir. 1972). Our reasoning in those cases, however, has been undermined in significant respects by an intervening decision of the Supreme Court. See NLRB v. Financial Inst. Employees, Local 1182, 475 U.S. 192 (1986) [Sea-First]. Sea-First created a new standard by which we must evaluate cases such as the present one and prevents us from relying on at least some of the factors we considered persuasive in our earlier cases. More specifically, Sea-First requires the Board (and us) to focus exclusively on employees and their relationship to their union when evaluating whether a "question of representation" exists. Any concern with the effect of internal union changes on the union's relationship with the employer, upon which we focused in our earlier cases, are outside the purview of representation issues under the Act. Further, to the extent that a portion of our analysis in the earlier cases is still valid, wefind this case easily distinguishable on its facts.

In this case, the Board applied its general principles governing union recognition, as well as the specific principles for union affiliations that require the employer to demonstrate that an affiliation has created a substantial change in a union and in the relationship between the employees and their union. The Board found there to be no substantial change. We find that the Board's factual findings and its application of these affiliation principles have substantial support in the record, and that its Conclusions are based on a reasonable interpretation of the Act and the case law in this area. Consequently, we will deny CPS's petition for review and will enforce the Board's order.*fn1

I.

CPS operates a chemical plant in Old Bridge, New Jersey, at which it employs approximately 32 production employees (operators, mechanics, and laborers). From 1984 through 1995, these employees were represented by an independent union, which was not affiliated with any local, regional, or national organization. The independent union handled its own negotiations, electing a committee of workers to bargain with the employer, and processed its grievances without outside assistance. On the rare occasions when grievances were arbitrated, the union hired an attorney to handle those cases. In 1995, leaders of the independent union began exploring the possibility of affiliating with a larger union. At this time, the employer and union were parties to a three-year collective bargaining agreement, effective through January 3, 1996. In April 1995, about half of the CPS employees met with representatives of Local 8-397 of OCAW, a national union with approximately 85,000 members. Following Discussions with OCAW, a special meeting was called by the independent union's leadership for CPS employees to vote on whether or not to affiliate with Local 8-397. Notice of the meeting was sent to all union members on May 1, 1995, and the meeting was held on May 17, 1995.

Fifteen employees attended the May 17 meeting and voted by secret ballot. Seven others mailed in absentee ballots. All twenty-two members of the independent union who voted cast their ballot in favor of affiliation. As a result of the vote, a resolution was adopted changing the name of the independent union and handing over all assets and property of the independent union to Local 8-397. The resolution also indicated that Local 8-397 would become a party to the collective bargaining agreement with CPS, and directed the leadership of the union to take all necessary steps to effect the change in affiliation.

CPS employees make up only a small portion of Local 8-397's membership; employees of approximately 18 different employers are affiliated with the Local, which has about 550 members. All Local 8-397 members employed by the same company make up a "unit group." Each unit group handles its own negotiations and grievances, but a representative of OCAW usually assists in negotiations and arbitrations. The unit groups decide grievance settlements on their own and must approve any collective bargaining agreement to which they are a party. The International also must approve any contracts negotiated by the unit groups, but the International cannot force a unit group to accept a contract that the latter does not itself approve. Local 8-397 dues are equal to two hours pay per month, or about $30 for CPS employees, as compared to the independent union's dues of $12 per month. Unit groups elect a unit vice-president, who leads the unit and sits on Local 8-397's executive board, and grievance/negotiation committeemen.*fn2

Following the affiliation vote, Local 8-397 wrote to CPS informing it of the affiliation. After requesting certain information and noting that it would withhold judgment on the affiliation, CPS notified Local 8-397 on June 7, 1995, that it would not recognize the affiliation and that it would refuse to recognize and bargain with Local 8-397 as the representative of its production employees. Local 8-397 therefore filed an unfair labor practice charge with the NLRB, which issued a complaint against CPS, alleging violations of section 8(a)(1) and (5) of the National Labor Relations Act, 29 U.S.C. § 158(a)(1), (5) (1994). Section 8(a)(5) provides that it is an unfair labor practice for an employer to refuse to bargain with the representative of its employees. Section 8(a)(1) makes it improper to "interfere with, restrain, or coerce employees in the exercise of the rights guaranteed" in section 7 of the Act, including the rights to organize and bargain collectively. Following a hearing, an Administrative Law Judge found that CPS had violated both section 8(a)(1) and (5). The Board affirmed the ALJ's findings and adopted his recommended order. See CPS Chemical Co., 324 N.L.R.B. No. 154, 1997 WL 703038 (Nov. 7, 1997). CPS petitioned this Court for review of the Board's order and the NLRB cross-petitioned for enforcement of the order. We have jurisdiction under section 10(e) and (f) of the Act, 29 U.S.C. § 160(e), (f).

While CPS challenges many of the Board's factual findings, "we must . . . accept the Board's factual determinations and reasonable inferences derived from factual determinations if they are supported by substantial evidence." Stardyne, Inc. v. NLRB, 41 F.3d 141, 151 (3d Cir. 1994). Substantial evidence is "more than a mere scintilla. It means such relevant evidence as a reasonable mind might accept as adequate to support a Conclusion." Universal Camera Corp. v. NLRB, 340 U.S. 474, 477 (1951) (internal quotations omitted). As to the Board's legal analysis of the affiliation issue, our review is plenary, but "[b]ecause of the Board's `special ...


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