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St. George Warehouse, Inc. v. National Labor Relations Board

August 23, 2005

ST. GEORGE WAREHOUSE, INC., PETITIONER IN NO. 04-2893
v.
NATIONAL LABOR RELATIONS BOARD, PETITIONER IN NO. 04-3363



On Application for Review and Cross-Application for Enforcement of an Order of the National Labor Relations Board Entered May 12, 2004, in Case 22-CA-24902

The opinion of the court was delivered by: Pollak, District Judge.

PRECEDENTIAL

Argued May 9, 2005

Before: SLOVITER and FISHER, Circuit Judges, and POLLAK,*fn1 District Judge.

OPINION OF THE COURT

St. George Warehouse, Inc. ("St. George"), a company that warehouses shipping containers, petitions for review of an order of the National Labor Relations Board ("NLRB" and "Board") finding that it violated section 8(a)(5) and 8(a)(1) of the NLRA, 29 U.S.C. § 158(a)(1) and (5),*fn2 by unilaterally transferring unit work to temporary agency employees, who are not union members. To remedy these violations, the Board ordered St. George to restore the ratio of direct hires to temporary agency employees to the status quo that existed just prior to the union election. St. George contests the Board's order, arguing that the union's complaint was time-barred, that the hiring practices complained of were consistent with the NLRA, and that the restoration remedy is "repugnant" to the purposes and policies undergirding the NLRA. The Board has cross-petitioned, seeking enforcement of its order. For the reasons which follow, we will deny the petition for review and enforce the order of the Board.

I.

St. George is a corporation with an office and place of business in South Kearny, New Jersey, that warehouses containers from ships. On March 8, 1999, Local 641 of the International Brotherhood of Teamsters ("IBT") petitioned the NLRB for a representation election of St. George's warehouse employees. According to Local 641, the unit was to include "[a]ll full-time and regular part-time warehouse employees employed by [St. George] at its South Kearny, New Jersey facility, but excluding all temporary agency employees, office clerical employees, professional employees, guards and supervisors as defined in the Act." J.A. at 11 (emphasis added).*fn3

On April 14, 1999, a secret ballot election was held at St. George. The union won the election and, on October 27, 2000, the union was certified. On December 19, 2000, the union requested that St. George meet with it to begin the collective bargaining process. St. George refused, and Local 641 filed an unfair labor practice charge. On April 10, 2001, the Board ruled in favor of the union on summary judgment and, on August 7, 2001, the Third Circuit enforced the Board's order directing St. George to bargain collectively with the union. St. George Warehouse, Inc. v. NLRB, 261 F.3d 493 (3d Cir. 2001).

In 2002, the union filed a second unfair practice charge with the NLRB. That charge alleged that St. George had decided, some time after the union election, to stop making direct hires, and to replace terminated or departed workers exclusively with agency (i.e., non-unit) employees. As a result of this practice, the unit decreased from 42 employees at the time of the election to 8 employees by July 2002, when the union and St. George appeared before an ALJ for a hearing inquiring into St. George's hiring practices. It is undisputed that the decision to replace departing direct hires with temporary agency workers was made unilaterally, without notice to the union or an opportunity for it to bargain.

The ALJ found that St. George had altered the status quo that existed before the union election. More specifically, the ALJ determined that prior to the union's election, which was held in April 1999, St. George did not have a policy or practice of hiring agency warehousemen to replace direct hires who left St. George's employ. The ALJ concluded that St. George's unilateral transfer of unit work to temporary agency employees without giving the union notice and the opportunity to bargain violated section 8(a)(5) and (1) of the NLRA, 29 U.S.C. §158(a)(5) and (1).*fn4

In reviewing the ALJ's decision, the Board agreed with the ALJ's finding that St. George had violated section 8(a)(5) and (1) by unilaterally transferring work to agency employees. The Board disagreed with the ALJ's proposed remedy for the section 8(a)(5) and (1) violations, however. The ALJ had recommended that St. George immediately restore and maintain the ratio of direct hires to agency employees that existed at the time of the union election, which the ALJ found to be 7:1. The Board determined that the 7:1 ratio was not entirely appropriate because, prior to the union election, the total number of agency employees used by St. George fluctuated from week to week, as did the total number of direct hires. The ALJ's 7:1 ratio did not account for this fluctuation. Thus, the Board decided to leave to the compliance stage the determination of the proportion of direct hires and agency employees that St. George must maintain in order for the unit to be properly restored.*fn5

St. George has petitioned for review, and the Board has cross-petitioned for ...


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