United States Court of Appeals, District of Columbia Circuit
March 19, 2018
Petition for Review and Cross-Application for Enforcement of
an Order of the National Labor Relations Board
S. Remar argued the cause for the Petitioner. Eleanor Morton
and Emily M. Maglio were with him on brief.
Ginn, Attorney, National Labor Relations Board, argued the
cause for the Respondent. Richard F. Griffin, Jr., General
Counsel at the time the brief was filed, John H. Ferguson,
Associate General Counsel, Linda Dreeben, Deputy Associate
General Counsel, and Usha Dheenan, Supervisory Attorney, were
with her on the brief.
A. Rosenfeld was on the brief for Intervenors International
Association of Machinists and Aerospace Workers, et al., in
support of the Respondent and Cross-Petitioner.
Before: Henderson, Kavanaugh and Katsas, Circuit Judges.
LeCraft Henderson, Circuit Judge
post-World War II growth in international maritime shipping
has spawned a history of labor disputes along the West Coast
of the United States between the Petitioner, the
International Longshore and Warehouse Union (ILWU), and the
Intervenor, the International Association of Machinists and
Aerospace Workers, AFL-CIO (IAM). The battles between the two
unions have played out in federal court, see Int'l
Ass'n of Machinists & Aerospace Workers v. NLRB,
253 Fed.Appx. 625 (9th Cir. 2007), and before the National
Labor Relations Board (NLRB or Board), see Pac. Mar.
Ass'n, 256 NLRB 769, 772 (1981). This case adds a
chapter to the unions' protracted disputes.
2002, the Pacific Crane Maintenance Company (PCMC) began
using a subsidiary,  the Pacific Marine Maintenance Company
(PMMC) (together, Employer or PCMC/PMMC), to provide loading
and unloading services to Maersk, a large shipping company,
at three West Coast ports: Oakland and Long Beach, California
and Tacoma, Washington. PCMC created PMMC to perform the
Maersk contract because Maersk had purchased the terminal
operations from a company named Sealand, which, as a
condition of sale, required Maersk to recognize IAM
as the union representative for the employees performing
maintenance and repair (M&R) work at the three ports.
Because PCMC was already bound by a collective bargaining
agreement (CBA) with ILWU, it could not recognize IAM itself.
Thus, from 2002 to 2006, PCMC continued to recognize ILWU
while its subsidiary, PMMC, recognized IAM as the
representative of the M&R employees at the Oakland and
2004, in an effort to drive down costs, Maersk requested bids
from both PCMC and PMMC for M&R work at the Oakland and
Tacoma ports. PCMC responded with the lower bid and Maersk
accepted it. As a result of losing the Oakland and Tacoma
M&R work, on March 30, 2005, PMMC terminated its 100
M&R employees and shut down its operations completely.
The next day, PCMC hired 76 of the former PMMC mechanics to
do the same M&R work and hired six additional former PMMC
mechanics shortly thereafter. As a result of the change,
however, PCMC ceased recognizing IAM and began recognizing
ILWU as the former PMMC M&R employees' union. IAM
responded with claims of unfair labor practices and the NLRB
General Counsel brought charges against ILWU, PMMC and PCMC
under the National Labor Relations Act, 29 U.S.C.
§§ 151-169 (NLRA or Act). With a few exceptions no
longer at issue, the administrative law judge (ALJ)
recommended dismissing the charges. The Board disagreed,
concluding that the Employer was obligated to bargain with
IAM over the termination of PMMC's unit employees and
that the Employer's recognition of ILWU was unlawful.
Ultimately, PCMC and PMMC settled the claims, leaving ILWU as
the sole Petitioner.
raises three challenges to the Board's Decision and
Order. First, it contends that the Board erred in concluding
that the Employer was obligated to bargain with IAM over its
decision to shut down PMMC and terminate its workforce.
Second, it argues that the Board improperly excluded evidence
that the M&R employees merged by accretion into the ILWU
West Coast-wide employee bargaining unit. Third, it disputes
the propriety of the Board remedy. For the following reasons,
we deny ILWU's petition and grant the Board's
cross-application for enforcement.
and companies like it, transport goods around the world in
large container ships packed with 20-foot metal containers.
At port terminals, the shipping containers are unloaded by
cranes and transported to off-site locations where they are
"stripped" and distributed to their final
destinations. The inverse process includes
"stuffing" containers off-site and eventually
loading them onto the cargo ships for export at the
terminals. See Joint Appendix (JA) 693, 1218-19. The
machinery and the containers used in this process
periodically need maintenance and repair. Port-terminal
contract repair companies, like the Employer, employ M&R
mechanics to ensure the process runs smoothly.
Board has previously chronicled the history of ILWU and IAM.
See, e.g., Shipowners' Ass'n of the Pac.
Coast, 7 NLRB 1002 (1938); Pac. Mar. Ass'n,
256 NLRB 769, 772 (1981). We note, however, that the two
unions have different organizational models. In the
port-terminal context, IAM represents only M&R mechanics
and it usually does so on a local level, dividing its
bargaining units either by terminal or by company. This was
the case from the 1960s to the early 2000s, when IAM operated
as the exclusive union representative for the
single-employer, multi-terminal bargaining unit of M&R
mechanics at Long Beach, Oakland and Tacoma.
more inclusive. Its bargaining unit is composed of a West
Coast-wide group of longshoremen, stevedores, marine clerks,
planners and longshore mechanics. A single CBA, the Pacific
Coast Longshore and Clerks Agreement (PCL&CA),
binds ILWU, on one side, and the Pacific Maritime Association
(PMA), a collection of approximately 70 maritime employers
along the Pacific Coast (including PCMC), on the other.
Pursuant to the PCL&CA, ILWU and
have established an employment dispatch system that is in
effect along the Pacific Coast. The system operates through a
series of "halls" that match employees to employers
on a flexible basis so that labor can flow to the terminals
that need it most. The Employer describes this system as its
"lean staffing model." JA 412.
chapter of the unions' story began in 1999, when Maersk
purchased the Oakland, Tacoma and Long Beach port
operations from Sealand. As a condition of the sale,
Sealand required Maersk to recognize IAM as the M&R
mechanics' union in all three locations.
time, PCMC was performing M&R work for Maersk in Los
Angeles and it was interested in expanding its work to the
three newly acquired Maersk terminals. Because PCMC was
bound by the PCL&CA to recognize ILWU, however,
Sealand's IAM-recognition requirement prevented PCMC from
performing the work. In order to get around this obstacle,
PCMC created PMMC. PMMC then bid on, and won, the Maersk
contract. Thereafter, PMMC recognized IAM and began
performing the M&R work at the former Sealand terminals.
March 31, 2002, the IAM-Sealand (now IAM-PMMC) CBA was set to
expire. Around the same time, Maersk consolidated its
Southern California operations by merging its M&R
workforce into a single terminal (Pier 400) in the Port of
Los Angeles. As a result of the consolidation, Maersk no
longer needed PMMC's services at the Long Beach terminal
and instead contracted with PCMC to do its M&R work at
the new consolidated Los Angeles terminal. As for the Oakland
and Tacoma terminals, PMMC and IAM agreed to a CBA extension
from April 1, 2002 to March 31, 2005 but did so only after
more than a dozen bargaining sessions and a strike vote of
2004, with the March 31, 2005 CBA expiration date looming,
Maersk solicited bids from both PCMC and PMMC for work at the
Oakland and Tacoma terminals. PCMC submitted a bid of $64.46
per hour and PMMC submitted a bid of $72.88 per hour. At the
ALJ hearing, PCMC and PMMC representatives explained the
difference in price. PCMC representative Joseph Gregorio
testified that the discussion regarding the different bid
prices "always was focused upon the concept that there
was differences [sic] in labor costs, " including
"benefits and pensions." JA 92. Similarly, PMMC
informed Maersk that its higher bid resulted from a
"collection of [employee] benefits." JA 172.
selected PCMC to do the work. Accordingly, on January 25,
2005, Maersk terminated its maintenance contract with PMMC,
effective March 31, 2005. On January 26, PMMC notified IAM,
informing it and its unit employees that PMMC intended to
terminate its operations on April 1. PMMC also explained how
the unit employees could apply for employment with PCMC to
continue working the same jobs. In early February, IAM
requested that PMMC bargain over its decision to terminate
work at the Oakland and Tacoma terminals. PMMC agreed to
bargain over the effects of the terminations but asserted