EMILIO M. GARZA, Circuit Judge:
Carey Salt Company ("Carey Salt") petitions for review of a National Labor Relations Board ("Board") decision finding that the company violated Section 8(a)(1), (3), and (5) of the National Labor Relations Act ("the Act"), 29 U.S.C. § 158(a)(1), (3), (5). See Carey Salt Co., 358 NLRB No. 124, 2012 WL 4021866 (Sept. 12, 2012) [hereinafter Board Decision]. The Board cross-petitions for enforcement of its order. Because we conclude that substantial evidence on the record considered as a whole supports findings material to all terms of the order except for the order's mandate that Carey Salt cease and desist from presenting regressive bargaining proposals for the purpose of frustrating negotiations, we enforce the order in part and vacate it in part.
Carey Salt operates a rock salt mine in Cote Blanche, Louisiana. In February of 2010,
The disputes underlying this case arose in March of 2010. Between February 8 and March 19, the parties had met fourteen times to bargain over the terms of a new agreement that would replace the one expiring on March 24. By March 10, Union negotiators had accepted Carey Salt's proposals on benefits and severance, but
On March 18, after an initial confrontational discussion of wages, the Union requested a "final" offer from Carey Salt. According to the Union representative, when making this request, he had explained to Carey Salt representatives that his purpose was merely to obtain membership feedback on the offer's terms ahead of the prior contract's expiration. Moreover, he claims that he explicitly conveyed his intent to return to negotiations in the event of the offer's rejection by the membership vote. Carey Salt representatives claim that they asked for confirmation that the Union wanted a final offer, and deny that they understood the requested offer to be a potential basis for continued talks.
On March 19, Carey Salt negotiators presented their final offer. Featured in the offer were terms consistent with the company's position on its three core issues—new overtime rules, new shift schedules, and the elimination of a letter of understanding restricting cross-assignment. The offer included all items on which tentative agreement had been reached but omitted certain items that, while not yet secured by tentative agreement, Carey Salt had integrated into its own earlier proposals. These omitted items consisted of expanded job classifications eligible for hazard pay and the new shift trial period. On the other hand, the offer included a 2.5 percent year-on-year wage increase, a departure from the company's previous proposal to not increase wages at all.
The Union negotiator confirmed that Carey Salt's omissions were "intentional" and was disappointed that the offer's terms were not as favorable as what earlier talks had seemed to place within reach. A Carey Salt negotiator later conceded that he suspected the omissions would make the offer harder to "sell" to the membership. Indeed, on March 24, the Union membership voted to reject the offer. The Union representative immediately contacted the Carey Salt team and requested to meet; the latter agreed and extended the existing contract to March 31.
On the morning of March 31, the parties met for a short, but consequential, two-and-a-half hours. The Union representative explained membership concerns, which both sides acknowledged surfaced no new issues. Carey Salt negotiators, having confirmed the Union's rejection of the final offer, then declared impasse over Union protest. Company negotiators explained that the Union had asked for a final offer, and then departed from the meeting site by approximately 11:30 A.M., thereby executing the "end game" outlined by Carey Salt's CEO the previous day. In the afternoon, the Union representative tried unsuccessfully by phone and email to bring Carey Salt negotiators back to the table by explaining that he had new proposals that would "move in a meaningful way" toward Carey Salt's positions on shift scheduling and other issues, and that a federal mediator was available. The Union membership, at a special meeting later in the day, reconsidered but again voted to reject the final offer. That night, a Carey Salt negotiator confirmed that the company was
The parties communicated minimally in April. On April 1, in the wake of the March 19 offer's implementation, the company confirmed that, having reached impasse, it would not meet again unless the Union accepted the offer in full. On April 7, the Union, believing the March 31 implementation to be an unfair labor practice, voted to strike. At the Union's request, the parties held an off-the-record meeting on April 20 to allow the Union's director to understand Carey Salt's concerns.
On April 30, the federal mediator's efforts succeeded in bringing the parties back to the negotiating table, and the revived talks produced a "modified final proposal." However, on May 6, the Union membership rejected this offer and continued its strike. On May 25, Carey Salt negotiators presented a revised offer that rolled back prior concessions and increased the number of core issues to seven. This offer included a merit-based system for recalling workers that replaced the expired agreement's seniority-based system.
In June, the parties faced continued stumbling blocks. Carey Salt rejected Union proposals and insisted on acceptance of its seven core issues. On June 15, employees ended their strike, but little progress resulted. The company recalled strikers by merit rather than by seniority, prompting further Union discontent. After more meetings, a failure to agree, and the Union's refusal to vote on a June 23 offer, Carey Salt, claiming impasse, again unilaterally implemented changes in terms and conditions of employment.
The Union brought charges alleging unfair labor practices, and the Board's General Counsel issued a complaint. Administrative Law Judge ("ALJ") Margaret G. Brakebusch found that Carey Salt had violated Section 8(a)(3) and (1) of the Act by failing to reinstate employees engaged in the unfair labor practice strike, and Section 8(a)(5) of the Act by failing to bargain with the Union in April 2010. Additionally, the ALJ found that the company had violated Section 8(a)(5) and (1) of the Act by making unilateral changes in employment terms and conditions in the absence of impasse, conditioning bargaining over mandatory subjects of bargaining on Union concessions, presenting a regressive proposal on or about May 25 that aimed to frustrate agreement, and improperly treating employees who engaged in the unfair labor practice strike beginning on April 7.
The Board's final order requires Carey Salt to cease and desist from its violations of the Act and to affirmatively remedy its violations. Specifically, Carey Salt was ordered to restore terms and conditions of employment to their pre-March 31 status until agreement or valid impasse is reached, make whole employees who suffered losses as a result of the March 31 implementation or the company's failure to reinstate strikers, and post at the mine copies of a notice explaining the company's obligations. Id. at 2-4.
Carey Salt petitions us for review of the order and submits that the Board's findings are not supported by substantial evidence. The Board cross-petitions for enforcement of its order.
Section 10(e) of the Act instructs us to accept the factual determinations of the
Our deference, however, has limits. We must "consider the whole record," and "[t]he substantiality of evidence must take into account whatever in the record fairly detracts from its weight." Universal Camera Corp. v. NLRB, 340 U.S. 474, 488, 71 S.Ct. 456, 95 L.Ed. 456 (1951). Moreover, a decision by the Board that "ignores a portion of the record" cannot survive review under the "substantial evidence" standard. Lord & Taylor v. NLRB, 703 F.2d 163, 169 (5th Cir.1983) (reversing finding of employer's anti-union animus where Board ignored all management testimony and unfavorable testimony by discharged employee).
We review the Board's conclusions on matters of law de novo. NLRB v. Arkema, Inc., 710 F.3d 308, 315 (5th Cir.2013) (citing El Paso Elec., 681 F.3d at 656).
The Board, adopting the ALJ's decision, found that Carey Salt violated Section 8(a)(5) and (1) of the Act on both March 31 and June 27, by unilaterally implementing changes to employment terms during negotiations in the absence of impasse. On appeal, Carey Salt contends that because the parties had bargained to impasse, both implementations were lawful.
Section 8(a)(5) of the Act imposes on employers a duty to bargain collectively with employee representatives. 29 U.S.C. § 158(a)(5). Section 8(a)(1) obligates the employer to refrain from limiting employees' exercise of their rights. Id. § 158(a)(1). Generally, an employer breaches these duties when it unilaterally implements a change in the terms and conditions of employment during contract negotiations. See id. § 158(d) ("[N]o party" to a collective-bargaining contract covered by the Act "shall terminate or modify such contract" absent specified conditions.); Huck Mfg., 693 F.2d at 1186.
We have recognized, however, that when an employer and union bargain to impasse, the employer may unilaterally implement changes in contract terms, so long as the changes were previously offered during negotiations. See Huck Mfg., 693 F.2d at 1186. Impasse is reached when "further discussion [is] futile... in view of all the circumstances of the bargaining." Powell Elec. Mfg., 906 F.2d at 1011. In particular, this futility requires that "neither party ... be willing to compromise." Id. at 1011-12 (quoting Huck Mfg., 693 F.2d at 1186) (emphasis in original).
Good-faith bargaining is a "necessary precondition" to a finding of impasse. Elec. Mach. Co. v. NLRB, 653 F.2d 958, 963 (5th Cir. 1981); see also Raven Servs. Corp. v. NLRB, 315 F.3d 499, 505 (5th Cir.2002) (concluding that failure to supply necessary information constituted bad faith and thereby "preclude[d] a finding of a genuine impasse"). At impasse, "the parties, despite the best of faith, are simply deadlocked." Huck Mfg., 693 F.2d at 1186 (quoting NLRB v. Tex-Tan, Inc., 318 F.2d 472, 482 (5th Cir.1963)) (emphasis added). The precondition of good faith comports with the statutory requirement for good-faith collective bargaining; without good faith, the bargaining itself is unlawful, as is any impasse purportedly reached therein. See 29 U.S.C. § 158(d) (requiring parties to "confer in good faith"). The statute provides explicitly, however, that the duty of good-faith bargaining does not "compel either party to agree to a proposal or require the making of a concession." Id.
We review the Board's findings regarding good faith with heightened deference
The Supreme Court, too, has signaled the importance of good faith by recognizing that parties may "intentionally" bring about impasse, but only as a "device to further, rather than destroy, the bargaining process." Charles D. Bonanno Linen Serv., Inc. v. NLRB, 454 U.S. 404, 412, 102 S.Ct. 720, 70 L.Ed.2d 656 (1982) (quoting Charles D. Bonanno Linen Serv., Inc., 243 NLRB 1093, 1094 (1979)). Moreover, the Court has explained that the duty to bargain in good faith requires more than "the mere meeting" of the parties; negotiations must grow out of a "serious intent to adjust differences and to reach an acceptable common ground." NLRB v. Ins. Agents' Int'l Union, AFL-CIO, 361 U.S. 477, 485, 80 S.Ct. 419, 4 L.Ed.2d 454 (1960).
Even in Taft Broadcasting Company, good faith was the central factor in the Board's analysis. In that case, the Board enumerated five factors that aid in determining whether an impasse existed, and both parties here urge us to apply them. These factors are (1) the parties' bargaining history; (2) the parties' good faith; (3) the duration of negotiations; (4) the importance of issues generating disagreement; and (5) the parties' contemporaneous understanding of the state of negotiations. Taft Broad. Co., 163 NLRB 475, 478 (1967), enforced sub. nom., Am. Fed'n Television & Radio Artists v. NLRB, 395 F.2d 622 (D.C.Cir.1968). All five factors are probative of impasse, but in the very same section of its decision, the Board explained that impasse is reached "after good-faith negotiations have exhausted the prospects of concluding an agreement." Id. (emphasis added). In applying the factors, the Board emphasized that "no evidence" suggested bad faith had tainted the parties' ultimately unfruitful efforts during twenty-three bargaining sessions. Id. Indeed, the D.C. Circuit, in enforcing the Taft decision, determined that this understanding of impasse "governed" the case and cited the Board's formulation verbatim, including the requirement of good faith. Am. Fed'n
We use the Taft factors to frame our analysis, mindful, however, that under our precedents and Taft itself, substantial evidence of a lack of good faith must preclude an impasse finding.
Carey Salt contends that substantial evidence does not support the Board's conclusion that no impasse existed on March 31, when the company unilaterally implemented its March 19 offer. Specifically, Carey Salt alleges that the Board overlooked evidence that undermines its analysis under each of the Taft factors. We consider each of the alleged errors.
Carey Salt challenges many aspects of the ALJ's findings under the first three Taft factors, emphasizing that it had a right to stand on its final offer and, given the Union's rejection, to seek impasse after many weeks of good-faith negotiations.
The ALJ's decision consolidated its analysis of the first three Taft factors—the bargaining history, length of negotiations, and good faith of the parties—and concluded that the factors collectively favor a no-impasse finding. The ALJ first conceded that, viewed over the long term, the factors suggest impasse. For instance, the parties enjoyed a forty-year history of successful negotiations, and there was no complaint of bad faith in the instant negotiation prior to Carey Salt's March 31 implementation. Board Decision at 11. The ALJ, however, then narrowed her temporal focus to the final days of negotiation and, in particular, Carey Salt's plan to swiftly declare impasse on March 31. The ALJ took issue with "sometimes short" meetings toward the end of the bargaining period, late commencement of negotiation over wages on March 18, Carey Salt's regressive March 19 proposal that "effectively insured that no meaningful negotiations could follow," and Carey Salt's desire to end negotiations using an impasse declaration. Id.
The ALJ concluded that impasse was precluded by the "immediate" bargaining history and Carey Salt's bad-faith conduct. Id. at 12. The Board chose not to rely on the ALJ's finding that the substance of the March 19 proposal eliminated the possibility of future negotiation, and the Board emphasized that regressive proposals were not per se illegal. Id. at 1 n. 5. Nonetheless, the Board concluded that the regressive March 19 proposal was an element of Carey Salt's "overall plan to frustrate agreement," and that therefore no valid impasse existed on March 31.
We must determine whether the Board's and ALJ's analyses under the first three Taft factors point us to substantial evidence on the record considered as a whole supporting the no-impasse finding. We conclude that there is such evidence, based on facts in the record establishing Carey Salt's bad faith, since bad faith precludes any finding of impasse. Elec.
The evidence of Carey Salt's bad faith hinges, we believe, on the Union's explanation, credited by the ALJ and Board, that when it requested the final offer on March 18, it made explicit to Carey Salt negotiators that talks would resume in the event of a membership vote rejecting the offer. If the Union's account were untrue, and both parties in fact understood the final offer to be truly "final" without recourse to further talks, then the Board has no basis for faulting Carey Salt's plan to declare impasse on March 31. If, however, the Union's request for the offer made it clear that the parties would continue negotiations in the event of rejection, then we will need to examine whether Carey Salt's actions are consistent with good-faith bargaining. We begin, then, with the ALJ's discussion of the final offer request.
The facts surrounding the final offer are somewhat murky. The company claims that because the Union had asked explicitly for a "final offer" on March 18, the Union necessarily understood the parties to be at impasse on March 31, when Carey Salt chose to stand on its offer after the Union membership's vote to reject it. A Carey Salt negotiator testified that company representatives had asked for confirmation that the Union was "sure" that it wanted a final offer, and that he never understood that the offer might serve as a basis for continued talks. Tr. at 902-903.
Faced with evidence supporting these conflicting accounts, the ALJ permissibly credited the Union representative's testimony that the parties did not in fact understand
Crucially, Carey Salt never conclusively refuted the Union's account of the March 18 request for a final offer, and we thus have no "compelling reason" to overturn the ALJ's credibility choice. Poly-America, Inc., 260 F.3d at 482. Before the ALJ, Carey Salt representatives never directly contradicted the Union negotiator's account of his request for the final offer. Tr. at 90, 831 (claiming only that Union team suddenly asked for the final offer). Rather, one Carey Salt negotiator testified that he "didn't understand" that the purpose of the request was to seek membership feedback. Tr. at 903. Carey Salt focused its arguments before the ALJ on the meaning of the word "final," but even this linguistic analysis did not fatally undermine the Union's account. While the Union negotiator explained that "final" can have a special meaning and asking for such an offer entails certain risks, Tr. at 460, he also explained that in many contexts, a "final" offer can merely mark the end of an intermediate stage in negotiation, Tr. at 426.
If the final offer was in fact neither explained nor understood as truly final, then the sequence of events "both at and away from the bargaining table" supports the Board's faulting Carey Salt's bad-faith conduct in the last days of negotiations leading up to March 31. Hi-Tech Cable, 128 F.3d at 276. First, as already established, the Union had explicitly informed Carey Salt that it would return to negotiations in the event the membership rejected the "final" offer. On March 24, immediately after the rejection vote, Carey Salt confirmed its willingness to meet again on March 31. Next, the lead Carey Salt negotiator made travels plans that would require her to depart the site of the final meeting after just a few hours. Then, the CEO detailed the "end game," a plan for a swift impasse declaration and unilateral implementation following the anticipated rejection. Board Ex. 10 at 1. Finally, at the March 31 meeting, company negotiators merely confirmed the Union's rejection of the offer before declaring impasse, departing abruptly, and refusing further talks. Board Decision at 11-12; Tr. at 270-72. The ALJ concluded that this sequence of events evinced a lack of desire to reach agreement, Board Decision at 11-12, and the Board adopted the same finding in faulting Carey Salt's "overall plan to frustrate agreement," id. at 1 n. 5.
Bearing in mind our deferential posture in reviewing determinations of bad faith, Big Three Indus., 497 F.2d at 46-47, we are satisfied that the evidence relied upon is substantial enough. Carey Salt deployed impasse not to "further," but to "destroy" the negotiation, at a critical point when the parties had explicitly
We acknowledge that the company had good-faith reasons behind its positions on the core issues, and that the Board may not "sit in judgment on the terms of the agreement." Gulf States Mfrs., 579 F.2d at 1317. Nonetheless, here, the Board was not making a substantive judgment, but calling a procedural foul. Here, the Union had expected continued bargaining, had made that expectation explicit when requesting the final offer, and had come to the table on March 31 prepared to begin a discussion of items on which Carey Salt had expressed tentative openness. Tr. at 275.
Although there is substantial evidence that Carey Salt's conduct fell short of good faith during the week leading up to March 31, we recognize its good-faith efforts throughout most of this negotiation. Nonetheless, good-faith bargaining is a "necessary precondition" to reaching valid impasse. Elec. Mach., 653 F.2d at 963.
However, we do take issue with one component of the Board's reasoning about Carey Salt's bad faith. There is no substantial evidence supporting the Board's finding that the March 19 regressive proposal was part of the company's "overall plan to frustrate agreement." Accordingly, the Board's narrative of bad-faith bargaining should not have encompassed the March 19 offer.
In challenging this finding, Carey Salt directs us to two other findings by the Board that it claims are inconsistent with locating bad faith in the March 19 offer itself. The Board found first that the Union did not complain of any bad-faith conduct before March 31, Board Decision at 11, and, secondly, that the substance of the March 19 offer was not so patently regressive as to foreclose bargaining, id. at 1 n. 5. In our view, these two findings do not alone preclude a linkage between the March 19 offer and the plan to frustrate bargaining detailed above. Nonetheless, no substantial evidence supports such a linkage, and we therefore decline to fault the March 19 offer on this basis.
We first explain why Carey Salt's two contentions fall short. First, as to the lack of a Union complaint about any pre-March 31 conduct, we have held that any findings not based strictly on the complaint still merit enforcement so long as the issues were fully litigated. See Huck Mfg., 693 F.2d at 1187-88. Carey Salt's "end game" did not come to fruition until March 31, when company negotiators declared impasse and refused to engage in further discussion, and the Union's complaint targeted this conduct rather than the March 19 offer itself. However, the issue of Carey Salt's plans to end the March 31 meeting with an impasse declaration was fully litigated before the Board, and the plan's centerpiece was the Union's rejection of the March 19 offer. Board Decision at 11. Therefore, the lack of any specific complaint about the company's conduct prior to the March 31 impasse declaration does not alone preclude the Board's finding that the March 19 offer was a regressive proposal that fit into an "overall plan to frustrate agreement."
The proper question, then, is whether in fact the link between the March 19 offer and Carey Salt's plan to frustrate agreement rests on substantial evidence. We conclude that it does not. The ALJ bases her reasoning solely on the purported admission by a Carey Salt negotiator that "the regressive changes in the March 19, 2010 proposal made it less attractive and harder for the union bargaining committee to present to the membership." Board Decision at 11. In reviewing the Board's finding of bad faith, we are obligated to consider the "totality of the employer's conduct." Hi-Tech Cable, 128 F.3d at 276. While we do not engage in de novo review, "[t]he substantiality of evidence" must withstand "whatever in the record fairly detracts from its weight." Universal Camera, 340 U.S. at 488, 71 S.Ct. 456. Our review of the record does not support the conclusion that the March 19 offer was part of Carey Salt's plan to frustrate agreement.
First, we clarify precisely what was omitted from the final offer. Carey Salt had removed items proposed by the Union and incorporated into company proposals during previous sessions, but on which tentative agreement had not been reached—specifically, provisions regarding hazard pay terms and the alternate shift trial period. The second deletion was inconsequential, since Carey Salt never completely adopted the trial period, even in its own counter-proposals; debate persisted over the escape clause that could terminate the trial period. See infra Section III.A.2. As for the hazard pay provisions, the parties had not reached tentative agreement, and even the Union negotiator testified that he merely found the offer to be "unsettling." Tr. at 264; see also Tr. at 449 (explaining parties' prior agreement that "nothing was to be deemed final as part of the negotiations until it was a tentative agreement").
Second, the ALJ misconstrues the Carey Salt negotiator's admission. The negotiator conceded on cross-examination only that the omissions "made that part of the contract [to which the omissions pertained] less attractive," and that as a result, it would be harder for the Union negotiator to sell the March 19 proposal to the membership. Tr. at 897-98 (emphasis added). As even Counsel for the Board conceded twice during this questioning, the fact that certain deletions would make the relevant portion of the proposal less attractive was merely "a common sense thing." Tr. at 898. Such inconsequential testimony does not prove that the offer overall was some-how
The Board is correct in contending that Carey Salt's plan to discontinue negotiations and declare impasse on March 31 was predicated on the Union's rejection of the March 19 offer. However, the terms and context of the offer do not establish that it was intentionally crafted as part of this overall plan. Rather, we conclude that substantial evidence supports a far more plausible alternate account: Carey Salt assembled a final offer in good faith, which the Union membership rejected on March 24. This rejection, and not the March 19 offer itself, set in motion Carey Salt's plan to terminate bargaining and declare impasse, which was made and executed in bad faith and contravened contemporaneous indications to the Union that it would return to bargaining. In other words, the facts do not bear out a connection between the impermissible plan to frustrate bargaining and either the substance or formation of the March 19 offer.
In attempting to construct such a relationship, the ALJ erroneously applied the Board's prior decision in Valley Oil Company, 210 NLRB 370 (1974). The ALJ read Valley Oil to stand for the proposition that withdrawal of prior agreed-upon items constitutes bad-faith bargaining. Id. at 384-86. First, Valley Oil is inapposite because the withdrawn provisions here had not even attained "tentative agreement" status, as the ALJ acknowledged. Board Decision at 11. Furthermore, the Board in that case undertook a highly contextual analysis and explained that changes in position "must be based on some development in the negotiations and not merely because the negotiator changes his mind." Id. at 385. The Board found no material "development," and concluded that employer negotiators were merely using fickle tactics to "frustrat[e] arrival at a contract." Id. Here, the Union's request for a final offer to take to the membership did signal a significant "development," and Carey Salt accordingly made holistic adjustments to its prior bargaining position, such as increasing wage growth and decreasing hazard pay. Cf. Chicago Local No. 458-3M, Graphic Commc'ns Int'l Union v. NLRB, 206 F.3d 22, 29-34 (D.C.Cir. 2000) (discussing Driftwood Convalescent Hosp., 312 NLRB 247 (1993), and holding employer withdrawal of agreed-upon terms to be lawful where Union failure to ratify proposal before stated deadline provided good cause).
Having reviewed the record, we conclude that substantial evidence supports the Board's finding that Carey Salt acted in bad faith leading up to its impasse declaration on March 31. Good faith bargaining is a prerequisite to achieving a valid impasse. Elec. Mach., 653 F.2d at 963. Accordingly, we hold that substantial
However, we hold that substantial evidence does not support the Board's finding that the regressive March 19 proposal was "part of [Carey Salt's] overall plan to frustrate agreement." The link to Carey Salt's plan is too conjectural, and no feature of the March 19 offer or its context suggests bad-faith bargaining.
Although the foregoing analysis already shows that substantial evidence supports the Board's no-impasse finding, we turn to the remaining two Taft factors to clarify points of fact and law on which the Board erred. The fourth Taft factor is the importance of the issues giving rise to disagreement. The more important the issues, the more likely that impasse is genuine and not contrived. Carey Salt claims that the Board improperly minimized this factor.
The ALJ began her analysis by acknowledging that the three "core" issues of overtime distribution, alternate shifts, and cross-assignment were of great importance to both the Union and Carey Salt. At stake were significant changes to employees' hours and pay, on the one hand, and long-sought improvements to the company's operational efficiency, on the other. Board Decision at 12. But the ALJ then cited evidence of "movement" on both sides that purportedly belied claims of importance. According to the ALJ, on March 10, just over a week before the final offer was requested, the Union suggested changes to Carey Salt's alternate shift proposal, and company negotiators incorporated the Union's suggestions into their own proposals. Id. at 6, 12.
The ALJ explained that this March 10 exchange signified "movement," which weakened the salience of the core issues' importance, for two reasons. First, the ALJ reasoned that because Carey Salt was willing at one point to compromise, and by implication might continue to display flexibility, the importance of the issues "does not overshadow the other Taft factors in the impasse analysis." Id. at 12. Second, and similarly, the Union's open "concession... on a significant issue" suggested that future compromise was possible, notwithstanding a persistent "wide gap" between bargaining positions. Id. at 12 (quoting Saunders House v. NLRB, 719 F.2d 683, 688 (3d Cir.1983)).
We cannot agree with either reason. Regarding the first, the ALJ's determination is based on a flawed reading of the record. As Carey Salt explains on appeal, the company never made any "movement" because it never adopted the Union's trial period proposal in full. Rather, the company had incorporated the general concept of a trial period into its own proposal, with a note that the escape clause was an outstanding point of dispute, and had consistently rejected the Union's escape clause option to revert to the original shifts.
On appeal, neither the Union nor the Board contests Carey Salt's detailed treatment of the record, and the Board asserts that the ALJ correctly found that the company adopted the Union's trial period proposal in full. After reviewing the record, we agree with Carey Salt that its receptiveness to the Union's general suggestion of a trial period does not constitute "movement," given the absence of agreement over the critical escape clause. Thus, the ALJ's flawed factual findings regarding the company's "movement" do not provide substantial evidence in support of the Board's no-impasse finding.
The ALJ's second path of reasoning rests upon a conclusion of law, which we review de novo. Arkema, 710 F.3d at 315. The ALJ invoked a sweeping proposition, purportedly extracted from the Third Circuit's opinion in Saunders House v. NLRB, that a party's un-withdrawn concession, however slight, on any single important issue precludes a finding of overall impasse. See Board Decision at 12 (citing Saunders House, 719 F.2d at 688). Even if we were to accept the persuasive value of Saunders House, the ALJ misstated the holding of that case.
In Saunders House, the Third Circuit addressed the narrow question of whether a union's on-the-record concession regarding wage increases constituted sufficient movement to preclude impasse, when the employer had not directly rejected the concession, but had previously rejected the same offer communicated in an off-the-record exchange. The court held that while the on-the-record offer was a "significant" concession given its departure from earlier on-the-record offers, it was not "sufficient" to avert an impasse finding. Saunders House, 719 F.2d at 687-88. In explaining its decision, the court reasoned that a concession on an important issue could preclude impasse despite "a wide gap between the parties," but that such a concession "must be one that should encourage the parties to believe that further negotiations would not be futile." Id. at 688. The move from off- to on-the-record did not clear the sufficiency hurdle, given the employer's prior knowledge of the union's position. Furthermore, in the same case, the court accepted that impasse existed on the equally critical issue of union security despite a significant union concession because, as the court explained, the employer had flatly rejected that "attempted compromise." Id.
Here, like the union security concession in Saunders House, the Union's proposed trial period with reversion to the original shifts had been roundly rejected by Carey Salt when its March 10 counter-proposal did not incorporate the Union's escape clause. Board Ex. 5 at 18; see also Tr. at 468. Even accepting arguendo that there was no explicit rejection, the Union's trial
The Board thus erred as a matter of law in reasoning that any kind of extended concession, despite rejection and remote chances of fueling future talks, precludes impasse. Such a broad rule would stifle open, exploratory negotiations on the most critical issues, for fear that even brainstorming would later be deemed "movement" undermining a legitimate claim of impasse. Accordingly, the Board's explication of the importance of the issues presents no substantial evidence to support its no-impasse determination.
We come to the fifth and final Taft factor—the contemporaneous understanding of the parties. The Board determined that the parties had no shared belief that negotiations had, in fact, reached impasse. Carey Salt contends on appeal that no substantial evidence under this factor supports the overall no-impasse finding.
As explained above, Carey Salt submits that the Union's request for a "final" offer was ample evidence of the Union's belief on March 31 that further talks were futile, but we determined that the ALJ made a proper credibility determination, and that therefore, neither party in fact understood the "final" offer request to signal the end of negotiations.
The ALJ first explains that the Union's surprise and repeated denials of impasse on March 31 suggest that no impasse existed. Board Decision at 12-13. Initial surprise, however, is irrelevant to the question of whether the Union ultimately believed that no further negotiation was possible. Cf. TruServ, 254 F.3d at 1118 (reasoning that Board's "focus on abruptness of the Company's Final Offer [and] on the Union's surprise upon receiving it ... misses the mark"). The Union's denials of impasse, while relevant, are likewise not substantial evidence of its beliefs about the state of negotiations, because as the ALJ herself reasoned, terms such as "impasse" and "deadlock" are non-binding legal conclusions. Board Decision at 12; see also TruServ, 254 F.3d at 1117 (concluding that union's "bald statement of disagreement" was insufficient to defeat impasse, without "conduct demonstrating a willingness to compromise further").
The ALJ then cites the Union's conduct as evidence of its genuine belief that negotiations were ongoing. Engaging a federal mediator and taking time to explain the membership's objections would have made no sense, explains the ALJ, had the Union
Nonetheless, because there was substantial evidence of Carey Salt's bad faith leading up to the impasse declaration, we hold that the Board's conclusion that no impasse existed as of the March 31 implementation is supported by substantial evidence on the record considered as a whole. See supra Section III.A.1; cf. Teamsters Local Union No. 639 v. NLRB, 924 F.2d 1078, 1083-84 (D.C.Cir.1991) (declining to review contested finding of bad faith determination and concluding that substantial evidence of short negotiations and lack of contemporaneous understanding sufficed to support Board's no-impasse finding); Colfor Inc. v. NLRB, 838 F.2d 164, 167 (6th Cir.1988) (declining to review four contested Taft factors and concluding that substantial evidence of lack of contemporaneous understanding alone supported Board's no-impasse finding).
Carey Salt further contends that the Board's finding of an unlawful implementation on June 27 in the absence of impasse is not supported by substantial evidence.
The ALJ explained that the Taft factors reveal an even clearer lack of impasse at the late June unilateral implementation, as compared to the March implementation. The ALJ noted the shorter bargaining period
Carey Salt's claims on appeal are limited. It asserts that under the Taft rubric, the parties reached a good-faith impasse after the Union refused to accept the company's seven core issues—three issues that had persisted since the start of negotiations, and four more demands made in May. But the company essentially concedes that the Board may rely on findings of the company's past bad faith if such findings are upheld on appeal.
Carey Salt's claims regarding the June 27 implementation are without merit. As noted above, the Board pointed to a shorter negotiations period and the Union's willingness to continue bargaining on open issues. Furthermore, the Board's uncontested reliance on Carey Salt's earlier bad faith was permissible. As the Board noted, previous bad-faith conduct does not automatically preclude a later finding of good-faith impasse, but in certain cases, unilateral changes can "move the baseline for negotiations" and "alter the parties' expectations about what they can achieve," thereby frustrating the bargaining process. Id. at 24 (quoting Alwin Mfg. Co., Inc. v. NLRB, 192 F.3d 133, 139 (D.C.Cir. 1999)). In this case, such spillover effects are evident in the record, found in the Union negotiator's direct references to the March 31 unlawful implementation in his protestations of Carey Salt's new assertions of impasse. Id. at 25. Finally, Carey Salt does not challenge the Board's findings that certain implemented terms were never offered in negotiations, and such findings are based directly on the Union negotiator's testimony on this matter. See Tr. at 407-411.
Accordingly, we hold that substantial evidence on the record considered as a whole supports the Board's no-impasse determination regarding the June 27 implementation, and we enforce the relevant portions of the order.
The Board, adopting the ALJ's conclusions, found that on three occasions, Carey Salt failed to bargain in good faith as required by Section 8(d) of the Act. 29 U.S.C. § 158(d). The Board found that Carey Salt (1) failed to bargain and conditioned mandatory bargaining upon Union concessions between March 31 and April 30; (2) presented a regressive proposal on May 25 that aimed to frustrate agreement; and (3) conditioned mandatory bargaining on acceptance of certain terms from June 3 to June 22. On appeal, Carey Salt challenges each finding.
Section 8(d) of the Act defines the act of collective bargaining as a mutual duty "to meet at reasonable times and confer in good faith with respect to wages, hours, and other terms and conditions of employment...." Id. § 158(d). The statute provides explicitly, however, that such a duty does not "compel either party to agree to a proposal or require the making of a concession." Id. We need not review again our and other courts' interpretations of the duty to bargain in good faith. See supra Section III. We note only one additional principle that guides our analysis below: The Board has held previously that the duty to bargain in good faith is suspended, though not terminated, during impasse. McClatchy Newspapers, Inc., 321 NLRB 1386, 1389 (1996), enforced, 131 F.3d 1026 (D.C.Cir.1997), cert. denied, 524 U.S. 937, 118 S.Ct. 2341, 141 L.Ed.2d 712 (1998).
Carey Salt first challenges the Board's two findings regarding the period from March 31 to April 30—that the company refused to bargain in good faith and that it conditioned bargaining over mandatory subjects of bargaining on Union concessions. The facts are sparse but largely undisputed. Just prior to the March 31 implementation, Carey Salt negotiators refused to bargain further, absent the Union's total acceptance of its final offer. An April 1 email exchange confirmed the company's stance. Board Decision at 15. Representatives from both parties met on April 20 for a less formal discussion to inform the Union's director of the company's views, at which "no bargaining" occurred by the Union's request, though Carey Salt contests this characterization. Id. at 16. The parties did not meet again until April 30. Id. at 15.
The ALJ's reasoning is supported by substantial evidence: Carey Salt refused to bargain and required the Union to agree to its final proposal before having further meetings, thereby violating its statutory duty to bargain in good faith in the absence of valid impasse. See 29 U.S.C. § 158(a)(5), (d). In the April 1 email exchange that froze discussion for weeks, the lead Carey Salt negotiator explicitly premised her refusal to meet on the earlier impasse declaration.
Carey Salt's submissions on appeal are unpersuasive. According to Carey Salt, the Union concedes that the company never refused to meet after April 7 and even agreed to the April 20 meeting in Houston. But we see nothing in the circumstances of the Houston meeting to support either the Board's or Carey Salt's positions because the parties had agreed at the time that the meeting was not a negotiation session.
We conclude that the Board's finding of Carey Salt's failure to bargain in good faith in April is supported by substantial evidence of the aforementioned lack of impasse and of the company's refusal to negotiate throughout April. We accordingly enforce the relevant parts of the order.
Carey Salt challenges the Board's finding that its "regressive" May 25 proposal also constituted a failure to bargain in good faith. The ALJ emphasized the May 25 offer's role in an "entire pattern of conduct" to prolong the strike and "to avoid an agreement rather than reach one." Board Decision at 19-20 (citing Cent. Mo. Elec. Coop., 222 NLRB 1037, 1042 (1976)).
The ALJ's finding a violation in the May 25 offer is based on a contextual analysis. Here, according to the ALJ, Carey Salt's regressive offer effected a concerted plan to lengthen the strike and to enable the hiring of more replacement workers in the interim. In particular, the ALJ reasoned that Carey Salt not only withdrew concessions, but "knowingly added more demands" that company negotiators knew would be rejected. Id. at 19. The ALJ accepted that no per se rule outlaws regressive proposals and that Carey Salt enjoyed greater leverage after surviving the initial weeks of the strike. Notwithstanding these considerations, the ALJ concluded that Carey Salt failed to fulfill its legal duty of good-faith bargaining.
Having examined the record, we conclude that there is no substantial evidence that Carey Salt transgressed the bounds of good faith. The ALJ first recalls Carey Salt's uncontested violation of threatening on April 30 to step up hiring of replacement workers in the absence of agreement. Tr. at 1089. However, this pressure tactic, while unlawful, aimed to expedite negotiations, not delay or avoid agreement. The Board's reliance on an email progress update to the CEO regarding the late May meetings is similarly misplaced. The text of the email update, rather than expressing a desire to delay agreement, in fact conveys precisely the opposite intent. Negotiators wanted to bolster their arguments for "implementing [absence control and safety policies] ASAP," to "move [the Union] along a little quicker [sic]" when they sensed the pace of talks was slackening, and to "try[] aggressively to overcome potential stalling tactics." Board Ex. 10 at 11.
The Board's strongest evidence is another internal email, in which the lead Carey Salt negotiator explains to the CEO that her proposing a meeting date for the following week should "forestall the union calling off the strike before then."
We pause to distinguish the permissible May 25 offer from Carey Salt's plans for late March, which the Board properly found to be aimed at frustrating agreement. In late March, Carey Salt seized upon the Union's use of the words "final offer" to terminate a meeting prematurely, swiftly implemented a planned impasse, and refused to bargain further, despite the Union's previously stated expectation of continuing talks in the event of the offer's rejection. As we have discussed, under those facts, substantial evidence of bad faith supports the Board's no-impasse conclusion. By contrast, in late May, company negotiators engaged their Union counterparts in two full-day sessions, had a plan of action in case the Union did agree, and expressed no intention to abandon talks.
In light of the foregoing, we hold that substantial evidence does not support the Board's finding that, on May 25, Carey Salt failed to bargain in good faith by presenting a regressive proposal aiming to frustrate agreement. We have already made the same determination with respect to the March 19 offer. See supra Section III.A.1. Accordingly, we vacate Part 1(f) of the order, which requires Carey Salt to cease and desist from "[p]resenting the Union with regressive bargaining proposals for the purpose of frustrating the negotiation of a collective-bargaining agreement."
Carey Salt challenges the Board's finding that from June 3 to June 22, it conditioned further mandatory bargaining on the Union's acceptance of certain terms.
Carey Salt claims that the ALJ misinterpreted the company's position. It directs us to the Union negotiator's notes explaining that company negotiators sought alignment on core issues not as a condition for further bargaining, but as a
Substantial evidence thus supports the ALJ's finding that Carey Salt unlawfully conditioned mandatory bargaining on first obtaining concessions. We enforce the relevant parts of the order.
The Board, adopting the ALJ's findings, determined that Carey Salt's various actions toward strikers violated Section 8(a)(1), (3), and (5) of the Act. 29 U.S.C. § 158(a)(1), (3), (5). Specifically, the Board found that Carey Salt (1) threatened to replace strikers; (2) failed to reinstate strikers; (3) failed to use seniority in recalling strikers; (4) continued to honor job offers to replacement workers; and (5) changed the time period for strikers to accept re-employment offers. Carey Salt does not contest the first and last findings. As to the second and fourth, Carey Salt's only line of defense is that because the
Carey Salt's only remaining claim on appeal regarding its treatment of strikers is that because it had no pre-existing duty to recall strikers by seniority, its merit-based recall was lawful. Under Section 8(a)(5) and 8(d) of the Act, employers must preserve the "status quo" during negotiations until the parties reach agreement or impasse, and this status quo can be defined by an expired collective-bargaining agreement. See Litton Fin. Printing Div. v. NLRB, 501 U.S. 190, 206-207, 111 S.Ct. 2215, 115 L.Ed.2d 177 (1991) (holding that expired contract terms remain "imposed by law" during negotiations). Carey Salt contends that the post-strike recall presented an entirely new scenario for the company, to which no prior "status quo" agreement applied.
This contention is unpersuasive. Carey Salt's own mine manager conceded that the expired contract's seniority-based recall procedures would have applied in the post-strike context as well. Board Decision at 28; Tr. at 155-56. This conclusion comports with our own reading of the expired agreement, which does not exempt post-strike recalls. Board Ex. 3(b); see In re Liljeberg Enters., Inc., 304 F.3d 410, 439 (5th Cir.2002) (contract interpretation is a question of law). Thus, given the absence of either impasse or any superseding agreement when the strike ended on June 15, Carey Salt had no power to effect a new merit-based recall procedure. Substantial evidence thus supports the Board's finding that Carey Salt unlawfully failed to recall striking employees by seniority. We accordingly enforce the relevant portion of the order.
Accordingly, the Board's order is ENFORCED in part and VACATED in part.