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Advance Cast Stone v. Local Union 1, 03-3090 (2004)

Court: Court of Appeals for the Seventh Circuit Number: 03-3090 Visitors: 14
Judges: Per Curiam
Filed: Jul. 22, 2004
Latest Update: Mar. 02, 2020
Summary: In the United States Court of Appeals For the Seventh Circuit _ Nos. 03-3090 & 03-3104 ADVANCE CAST STONE COMPANY, Plaintiff-Appellee, v. BRIDGE, STRUCTURAL AND REINFORCING IRON WORKERS, LOCAL UNION NO. 1, Defendant-Appellant. _ Appeals from the United States District Court for the Northern District of Illinois, Eastern Division. Nos. 01 C 2748 & 01 C 3892—Rebecca R. Pallmeyer, Judge. _ ARGUED FEBRUARY 24, 2004—DECIDED JULY 22, 2004 _ Before POSNER, RIPPLE and EVANS, Circuit Judges. RIPPLE, Circ
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                             In the
 United States Court of Appeals
               For the Seventh Circuit
                         ____________

Nos. 03-3090 & 03-3104
ADVANCE CAST STONE COMPANY,
                                                 Plaintiff-Appellee,
                                v.


BRIDGE, STRUCTURAL AND REINFORCING
IRON WORKERS, LOCAL UNION NO. 1,
                                             Defendant-Appellant.

                         ____________
          Appeals from the United States District Court for
          the Northern District of Illinois, Eastern Division.
      Nos. 01 C 2748 & 01 C 3892—Rebecca R. Pallmeyer, Judge.
                         ____________
     ARGUED FEBRUARY 24, 2004—DECIDED JULY 22, 2004
                         ____________



  Before POSNER, RIPPLE and EVANS, Circuit Judges.
   RIPPLE, Circuit Judge. On April 18, 2001, Advance Cast
Stone Company (“ACS”) filed a complaint seeking to vacate
an arbitration award issued against it and in favor of Bridge,
Structural and Reinforcing Iron Workers, Local Union No.
1 (“Iron Workers Local No. 1” or “the Iron Workers”). See 29
U.S.C. § 185. On September 30, 2002, the district court
entered a judgment affirming the arbitration award. On
2                                   Nos. 03-3090 & 03-3104

October 11, 2002, ACS filed a motion to alter or amend the
judgment. See Fed. R. Civ. P. 59(e). On July 8, 2003, the
district court granted ACS’ motion, reversed its earlier
affirmance of the arbitration award and entered a judgment
in favor of ACS. The Iron Workers timely appealed. For the
reasons set forth in the following opinion, we affirm the
judgment of the district court.


                             I
                     BACKGROUND
A. Facts
             1. Collective bargaining history
  ACS engages in the manufacture, delivery and installation
of architectural precast concrete and other products used in
construction. ACS has worked with two unions that are
relevant to this appeal. The principal union that performs
work for ACS is the Mason Contractors Association of
Greater Chicago and Illinois District Council No. 1 of the
International Union of Bricklayers and Allied Craftsmen
(“Bricklayers”). ACS has been bound by a series of collective
bargaining agreements with the Bricklayers since the late
1970s.
  ACS also has had occasion to engage members of the Iron
Workers Local No. 1 to work on its projects. Iron Workers
Local No. 1 bargains with the Associated Steel Erectors of
Chicago, Illinois (“Association”) for employees performing
iron work in certain counties. The Iron Workers entered into
a series of collective bargaining agreements with the
Association, commonly known as the “Principal Agreement.”
ACS is not a member of the Association; however, in 1982,
ACS signed identical compliance agreements with the Iron
Nos. 03-3090 & 03-3104                                      3

Workers. According to the compliance agreements, ACS
agreed to be bound to the Principal Agreement.
  On November 25, 1996, ACS submitted to the Iron
Workers written notice of termination, and, effective 1997,
the compliance agreements were terminated. After that time,
ACS was no longer bound to the terms of the Principal
Agreement, nor did ACS enter any other agreement with the
Iron Workers. ACS’ President, Matt Garni, testified that he
preferred to use Bricklayers because they are better able to
handle the work and because the Iron Workers’ wage and
benefits costs are higher than the Bricklayers’ costs.
  After the Principal Agreement was terminated in 1997,
ACS began to do a number of projects in the Chicago area,
the Iron Workers’ territory. In July or August of 1998, ACS
began working on the “Block 120” Project. Originally, ACS’
crew consisted only of Bricklayers; however, after some Iron
Workers working for other subcontractors threatened to walk
off the job, ACS entered into a “Short Form Agreement”
with the Iron Workers. In this agreement, dated August 6,
1998, ACS agreed, among other matters, to make certain
payments to the Iron Workers’ trust funds. The Short Form
Agreement, unlike the previous compliance agreements, did
not refer specifically to or incorporate the Principal Agree-
ment. After the Short Form Agreement was executed, ACS
completed the Block 120 Project with a composite crew of
Bricklayers and Iron Workers. ACS subsequently agreed to
apply the Short Form Agreement to two other pro-
jects—“Cathedral Place” and “Rush Garage”—in late 1998
and early 1999.
  Between August 1998 and the end of 1999, ACS worked
on ten additional projects within the Iron Workers’ territory;
in nine of the ten projects, a Bricklayers-only crew was used
without protest from the Iron Workers.
4                                         Nos. 03-3090 & 03-3104

      2. The Goodman Theatre Project and the Joint
               Arbitration Board Award
  In 2000, ACS worked on a number of other projects in the
Iron Workers’ territory with Bricklayers-only crews; the Iron
Workers did not protest. In August or September of 2000,
however, ACS began working on the “Goodman Theatre”
Project. It began the job with an all-Bricklayers crew, but the
Iron Workers threatened to picket in protest. This action
prompted ACS to file an unfair labor practice charge with
the National Labor Relations Board (“NLRB”). ACS con-
tended that the Iron Workers’ picketing threat violated
§ 8(b)(4)(D) of the National Labor Relations Act (“NLRA”),
29 U.S.C. § 158(b)(4)(D), and it sought a hearing under
                                  1
§ 10(k) of the NLRA, 
id. § 160(k).
However, the Iron Workers
notified the NLRB that it was disclaiming interest in the
work, and, accordingly, the NLRB dismissed the unfair
labor practice charge.
  Despite disclaiming this work, on or about November 21,
2000, the Iron Workers submitted a Grievance Dispute/
Demand for Arbitration with the Joint Arbitration Board
(“JAB”), an arbitration body created under the Iron Workers’
Principal Agreement to resolve disputes. The Iron Workers’
Grievance alleged: (1) ACS’ course of conduct bound it to
                          2
the Principal Agreement, and (2) ACS violated the Principal


1
  “A § 10(k) proceeding is a hearing conducted by the NLRB sub-
sequent to a § 8(b)(4)(ii)(D) claim to determine which union has
the superior claim to ‘work in dispute.’ ” Miron Constr. Co., Inc. v.
Int’l Union of Operating Eng’rs, Local 139, 
44 F.3d 558
, 561 n.11 (7th
Cir. 1995).
2
   “It is ‘well established that a collective bargaining agreement
is not dependent on the reduction to writing of the parties’ in-
tention to be bound,’ Capitol-Husting Co., Inc. v. NLRB, 671 F.2d
                                                      (continued...)
Nos. 03-3090 & 03-3104                                            5

Agreement by refusing to employ members of Iron Workers
Local No. 1 at the Goodman Theatre Project. The “course of
conduct” to which the grievance referred included actions
taken by ACS after signing the Short Form Agreement that
were consistent with the Principal Agreement but not speci-
fically required by the Short Form Agreement. For example,
the Iron Workers alleged that, since the execution of the
Short Form Agreement, ACS had provided certificates of
insurance, did not cancel a wage and fringe benefit bond
until February 12, 2001, and had complied with union audits.
All these actions were in compliance with, and pursuant to,
the terms of the Principal Agreement.
  On January 18, 2001, the JAB held a hearing. ACS argued
that the JAB lacked jurisdiction over ACS because ACS was
not a signatory to or otherwise bound by the Principal
Agreement. The JAB disagreed and concluded that, since
August 6, 1998 (when ACS signed the Short Form Agreement),
ACS had been bound by the Iron Workers’ Principal
Agreement. Accordingly, held the JAB, it had jurisdiction
over the dispute. The JAB also found that ACS had violated
the Principal Agreement by refusing to hire Iron Workers at
the Goodman Theatre site and other unspecified job sites. As
a remedy, the JAB ordered ACS to submit to a payroll audit
under the terms of the Principal Agreement and to pay wages
and benefits due for any work that should have been assigned
to Iron Workers since August 6, 1998.
  On April 18, 2001, ACS filed an action in district court that
sought vacation of that award. ACS again took the position


2
  (...continued)
237, 243 (7th Cir. 1982), rather ‘[a]ll that is required is conduct
manifesting an intention to abide and be bound by the terms of
an agreement.’ Id.” Gariup v. Birchler Ceiling & Interior Co., Inc.,
777 F.2d 370
, 373 (7th Cir. 1985).
6                                       Nos. 03-3090 & 03-3104

that it was not bound by the Principal Agreement, and,
accordingly, that the JAB lacked jurisdiction. As will be
described more fully below, the district court rendered its
first decision on September 30, 2002, in which it confirmed the
arbitration award. However, at the time it rendered that
decision, the district court was unaware that the same parties
were litigating the issue in a § 10(k) proceeding before the
NLRB, and, indeed, that the NLRB had handed down its
§ 10(k) determination just days earlier. The action that
prompted the proceeding, and the NLRB’s determination
therein, are described below.


     3. The Deerfield Project and the NLRB’s § 10(k)
                     Determination
  Around May of 2001, ACS began working on the “Nine
Parkway” or “Deerfield” Project with a Bricklayers-only
crew. The Iron Workers picketed. Its members carried signs
claiming “Breach of Contract.” On May 8, 2001, ACS filed
an unfair labor practice charge against Iron Workers Local
No. 1, alleging that it was violating § 8(b)(4)(D) of the
NLRA, 29 U.S.C. § 158(b)(4)(D), by engaging in proscribed
activity with an object of forcing ACS to assign the work at
the Deerfield Project to it rather than to Bricklayers. ACS’
claim under § 8(b)(4)(D) triggered a § 10(k) investigation
                                                        3
and ultimately a § 10(k) proceeding before the NLRB. On
September 26, 2002, just four days before the district court
entered its decision affirming the JAB’s award, the NLRB


3
  See 29 C.F.R. § 101.31 (“The investigation of a jurisdictional
dispute under section 10(k) is initiated by the filing of a charge,
as described in § 101.2, by any person alleging a violation of
paragraph (4)(D) of section 8(b).”); 
id. § 101.35
(explaining the
procedures for a § 10(k) hearing before the NLRB).
Nos. 03-3090 & 03-3104                                      7

issued its § 10(k) determination. The NLRB noted that, in
order for it to be able to proceed with a determination of a
dispute under § 10(k), it had to find, inter alia, “that the
parties ha[d] not agreed on a method for voluntary adjust-
ment of the dispute.” R.12, Attachment at 3. On this issue,
the NLRB held:
    [W]e find there is no agreed-upon voluntary mechanism
    for resolving this dispute. Thus, the Employer is not a
    signatory to the Iron Workers’ Principal Agreement or
    to any agreement containing such a mechanism. The
    project-only agreement the Employer signed with respect
    to Block 120 [the Short Form Agreement] makes no ref-
    erence to the Principal Agreement and neither do the
    Employer’s letters consenting to use of composite crews
    at the Cathedral Place and Rush Garage Construction
    sites. The Employer is not a signatory to any agreement
    between the Iron Workers International and the
    Bricklayers International Unions, and clearly not to an
    agreement that requires the use of composite bricklayer
    and iron worker crews for the work in issue or the
    submission of disputes to the joint boards. Therefore,
    none of the agreements cited by the Iron Workers are
    binding on the Employer. Moreover, the project-only
    agreements that the Employer operated under in the face
    of picketing, threats to picket, or joint board decisions
    are devoid of reference to mechanisms for the resolution
    of jurisdictional disputes, and therefore, cannot bind the
    Employer to JCB or JAB processes.
Id. at 4
(citation omitted). In a footnote, the NLRB further
noted:
    The Iron Workers argues that the Employer is bound by
    the Principal Agreement under the JAB’s award. We
    find no merit in that contention. The award fails to state
    the basis for the JAB’s finding that the Employer is
8                                      Nos. 03-3090 & 03-3104

    bound to the Principal Agreement even though it is not
    signatory to that agreement or to any other agreement
    implicating it. See, e.g., Operating Eng’rs Local 318
    (Kenneth F. Foesie Masonry), 
322 N.L.R.B. 709
, 714 (1996)
    (declining to give weight to arbitrator’s decision lacking
    rationale).
Id. at 3
n.8.
  On the merits of the § 10(k) jurisdictional dispute, the
NLRB concluded that the Bricklayers were entitled to per-
form the work in dispute. The NLRB explained that,
    [a]lthough various Iron Workers documents arguably
    cover work of the type in issue, the Employer terminated
    its collective-bargaining agreement with Iron Workers
    effective May 31, 1997. With the exception of the project-
    only agreements discussed above, which do not obligate
    the Employer at any other sites, the Employer is not sig-
    natory to or bound by any collective bargaining agreement
    with the Iron Workers.
Id. at 4
(emphasis added). Finally, the NLRB noted that,
although it usually limits the scope of its award to the
matter that gave rise to the § 10(k) controversy, because of
the history of disputes between the parties and the likeli-
hood of disputes in the future, it was appropriate to issue a
blanket, prospective order. In this order, the NLRB held that
the work at issue (the Deerfield Dispute) and all of ACS’
work within the Iron Workers’ jurisdiction belonged to
Bricklayers.


B. District Court Proceedings
                1. September 30, 2002 Decision
  After a bench trial, the district court issued its first opinion
on September 30, 2002. The district court began by noting
Nos. 03-3090 & 03-3104                                         9

that “[t]he central question in this case is whether Advance
Cast Stone was bound to the Principal Agreement at any time
after August 6, 1998,” the date the Short Form Agreement
was executed. R.23 at 10. If it was, then, under the Principal
Agreement, the dispute regarding the Goodman Theatre
Project was properly before the JAB, and the JAB’s award
                          4
would not be vacated. The district court explained that,
under this circuit’s case law, an employer may adopt a
collective bargaining agreement by its actions or a course of
conduct that demonstrates an intent to be bound, even if the
employer has not signed that agreement. The court held
that, although the evidence was close, ACS did bind itself to
the Principal Agreement “and therefore rendered it suscep-
tible to the jurisdiction of the JAB on January 18, 2001.” 
Id. at 14.

                  2. July 8, 2003 Decision
  On October 11, 2002, ACS filed a motion to alter or amend
the judgment pursuant to Federal Rule of Civil Procedure
59(e). In its motion, ACS argued that the NLRB’s ruling of
September 26, 2002, undermined the decision of the JAB and
therefore required the district court to reconsider its deci-
sion affirming the JAB’s award. The district court agreed,
and, on July 8, 2003, it entered judgment in favor of ACS.
  In its July 8, 2003 decision, the court began with the
settled proposition in this circuit that “an NLRB decision
issued pursuant to a § 10(k) proceeding overrides a conflict-


4
  ACS did not and does not dispute that, if it was bound by the
Principal Agreement, it violated the Principal Agreement by fail-
ing to give work to Iron Workers on the Goodman Theatre Project
and the other projects within the Iron Workers’ territory.
10                                     Nos. 03-3090 & 03-3104

ing decision by an arbitrator.” R.31 at 6. The court then
explained that the JAB’s award and the NLRB’s § 10(k)
determination conflicted. See 
id. at 9
(“[T]he JAB found that
ACS was bound to the Principal Agreement; the NLRB
found that it was not, and specifically noted that the JAB
had no jurisdiction over ACS. Although the JAB did not
directly address the Deerfield Project, the NLRB’s order makes
clear that ACS was not bound by the Principal Agreement
to use Iron Workers at that site, either.”). Because the court
found the JAB’s award in conflict with the NLRB’s § 10(k)
determination, and because the law compels that, in this
situation, the NLRB’s determination takes precedence, the
district court reversed its prior decision and held that the
JAB was without jurisdiction and its award must be vacated.


                               II
                        DISCUSSION
  “When an arbitration award is in conflict with the deci-
sion of the NLRB in a § 10(k) proceeding, the NLRB decision
takes precedence.” Miron Constr. Co., Inc. v. Int’l Union of
Operating Eng’rs, Local 139, 
44 F.3d 558
, 564 (7th Cir. 1995);
see also Chauffers & Helpers Local Union No. 50 v. McCartin-
McAuliffe Mech. Contractor, Inc., 
708 F.2d 313
, 315 (7th Cir.
1983) (“[A] Board decision pursuant to a Section 10(k)
hearing takes precedence over an inconsistent arbitral
decision.”). This principle flows from Carey v. Westinghouse
Electric Corp., 
375 U.S. 261
, 272 (1964) (“Should the Board
disagree with the arbiter . . . the Board’s ruling would, of
course, take precedence; and if the employer’s action had
been in accord with that ruling, it would not be liable for
damages under § 301.”), and has been adopted by other
circuits, see, e.g., J.F. White Contracting Co. v. Local 103 Int’l
Nos. 03-3090 & 03-3104                                        11

Bhd. of Elec. Workers, 
890 F.2d 528
, 529 (1st Cir. 1989)
(“[C]ourts are not to enforce an arbitration award that con-
flicts with a § 10(k) determination.”).
  The Iron Workers do not dispute this settled principle but
attempt to explain why it should not control the outcome of
this case. The Iron Workers’ arguments are legal ones, and
we therefore review them de novo. See Slaney v. The Int’l
Amateur Athletic Fed’n, 
244 F.3d 580
, 592 (7th Cir. 2001)
(explaining that, in reviewing a district court’s affirmation
or vacation of an arbitrator’s award, this court reviews legal
questions de novo and factual questions for abuse of
discretion). After considering the Iron Workers’ submis-
sions, we must agree with the district court that the princi-
ple controls the outcome of this case: The § 10(k) determina-
tion is in conflict with the arbitration award and, therefore,
trumps that award. Therefore, we affirm the district court’s
July 8, 2003 decision vacating the arbitrator’s award.
  First, the Iron Workers detail at great length that, both
before and after the NLRB’s § 10(k) decision, the district
court had jurisdiction over the vacation action under § 301
of the Labor Management Relations Act (“LMRA”), 29 U.S.C.
§ 185. This proposition is unquestionable, but it does not
advance the Iron Workers’ cause. When “a case involves
both the interpretation of a collective bargaining agreement
under Section 301 of the [LMRA] and allegations of viola-
tions of the NLRA, the federal district court and NLRB have
concurrent jurisdiction.” Mkt. Serv. Ass’n v. Produce, Fresh &
Frozen Fruits, & Vegetables, Fish, Butter, Eggs, Cheese, Poultry,
Florist, Nursery Landscape & Allied Employees Union, Local 703,
875 F. Supp. 474
, 477 (N.D. Ill. 1994). The district court had
“jurisdiction”—the statutory authority to determine
whether ACS was bound by the Principal Agreement (and
the implications that flow from that determination). What
we must resolve is how, in exercising that jurisdiction, the
12                                        Nos. 03-3090 & 03-3104

court should have factored the conflicting § 10(k) determi-
                                         5
nation into its decision-making process.
  The Iron Workers next argue that the JAB’s determination
is not in conflict with the NLRB’s § 10(k) determination;
thus, the principle that “courts are not to enforce an arbi-
tration award that conflicts with a § 10(k) determination” is
not triggered. J.F. White 
Contracting, 890 F.2d at 529
. The
Iron Workers note that the decisions technically involved


5
  The Iron Workers also contend that the NLRB’s § 10(k) decision
is not binding or controlling in this case because a § 10(k)
proceeding is not “final.” The Iron Workers’ argument emphasizes
that a § 10(k) proceeding is not the final resolution of whether
a union violated § 8(b)(4)(D). A final determination that the stat-
ute has been violated is reached only after the aggrieved union
refuses to abide by the § 10(k) decision and then fails to prevail
in the resulting unfair labor practice proceeding. See NLRB v.
Plasterers’ Local Union 79, 
404 U.S. 116
, 122 n.10 (1972); see also 29
C.F.R. § 101.36.
   Although a § 10(k) decision is not a final determination that the
union violated § 8(b)(4)(D), it certainly is controlling for purposes
of deciding its effect on and relationship to an arbitrator’s award,
at least when the aggrieved union—here, the Iron Workers— agrees
to comply with the § 10(k) determination. See, e.g., UAW Local
1519 v. Rockwell Int’l Corp., 
619 F.2d 580
, 584 (6th Cir. 1980)
(explaining that a § 10(k) decision should be treated as “final”
and controlling because a contrary conclusion would lead to the
“anomalous result of allowing the losing party in the 10(k) pro-
ceeding to prevent the employer from reaping the full benefit of
that proceeding, since review of the 10(k) decision can be had
only if the losing union commits an unfair labor practice, an event
entirely within the control of the losing union”); Int’l Ass’n of
Bridge, Structural & Ornamental Iron Workers Local No. 395 v. Lake
County, Ind. Council of the United Bhd. of Carpenters, 
347 F. Supp. 1377
, 1378 (N.D. Ind. 1972) (“Thus, the § 10(k) decision became a
final decision as a result of plaintiff’s compliance with it.”).
Nos. 03-3090 & 03-3104                                      13

different work. The JAB was presented with the Goodman
Theatre Project and, by virtue of its damages award, ad-
dressed projects between August 6, 1998 (when the Short
Form Agreement was signed), and January 18, 2001 (when
the JAB issued its award). The NLRB’s order addressed the
Nine Parkway or Deerfield Project, which took place in May
2001, and, by virtue of its area-wide prospective order, future
work. Therefore, the Iron Workers Local No. 1 argues, there
is no conflict and no reason why it should be precluded from
seeking redress through its § 301 contractual remedy.
  We believe that the district court was on solid ground in
not taking such a limited view of the NLRB’s § 10(k) deter-
mination. The NLRB’s § 10(k) decision addressed the entire
dispute, including the projects encompassed in the JAB’s
award. The NLRB discussed the history of the parties’ dis-
pute, including the Goodman Theatre Project, and, in the
end, issued an area-wide order that ACS was not bound to
employ members of the Iron Workers. In issuing such a
broad ruling, the NLRB explicitly departed from its normal
path of considering only the “particular controversy that
gave rise to the 10(k) proceeding.” R.12, Attachment at 6. It
took this unusual step because “work of the kind in dispute
has been a continuous source of controversy” and because
the Iron Workers had a “history of [engaging in] conduct
that arguably violates Section 8(b)(4).” 
Id. In so
holding, the
§ 10(k) determination clearly contemplated that, throughout
the years of dispute among ACS, the Iron Workers
and Bricklayers, ACS was not bound by the Principal
Agreement. See also R.12, Attachment at 4 (“Although
various Iron Workers documents arguably cover work of
the type in issue, the Employer terminated its collective-
bargaining agreement with Iron Workers effective May 31,
1997. With the exception of the project-only agreements
discussed above, which do not obligate the Employer at any
other sites, the Employer is not signatory to or bound by any
14                                     Nos. 03-3090 & 03-3104

collective bargaining agreement.”). Because the NLRB’s
determination disagreed with the JAB on the question of
whether ACS was bound to the Principal Agreement, it also
necessarily disagreed with the JAB on whether the JAB had
jurisdiction (because the JAB had jurisdiction only through
the Principal Agreement), whether the Iron Workers or
Bricklayers were entitled to the disputed work covered by
the JAB award (because Iron Workers were entitled to the
work only under the Principal Agreement), and, thus,
whether ACS should be liable for damages for refusing to
assign that work to Iron Workers.
  The Iron Workers also urge that, based on our case
law, the awards should not be considered irreconcilable.
They point to our decisions in Hutter Construction Co. v.
International Union of Operating Engineers, Local 139, 
862 F.2d 641
(7th Cir. 1988), and Miron Construction Co., Inc. v.
International Union of Operating Engineers, Local 139, 
44 F.3d 558
(7th Cir. 1995), as examples of cases in which we held
that an arbitration award to one union under a subcontract-
ing clause was not inconsistent with a § 10(k) determination
by the NLRB to award work to a different union.
   We believe Hutter and Miron are distinguishable from the
present case. First, as noted above, both Hutter and Miron
were premised on the unique subcontracting context in which
they arose. See, e.g., Miron 
Constr., 44 F.3d at 567
(“An arbitra-
tor’s award of backpay to one union in a subcontracting dispute
is not inconsistent with the NLRB’s prior award of the work
to a different union in a § 10(k) proceeding.” (emphasis
added)). Additionally, in Miron, we explicitly distinguished
situations—such as we face here—in which “[t]he employer . . .
was responsible both for the work assignment and for the
breach of certain terms of the union’s collective bargaining
agreement.” 
Id. at 566.
Nos. 03-3090 & 03-3104                                       15

   Second, those cases—because they arose in the context of
subcontracting disputes—did not involve a direct conflict
between the arbitrator’s and the NLRB’s awards and thus
did not implicate the general principle that the NLRB’s
§ 10(k) determination takes precedence over an arbitrator’s
award. For example, we explained in Hutter that “[t]he cri-
tical issue [wa]s whether the arbitrator, by awarding back-
pay to Operators, necessarily determined that they had the
superior claim to forklift work”—the determination made
by the NLRB. Hutter 
Constr., 862 F.2d at 645
(emphasis
added). We held the arbitration award did not reach that
ultimate issue because the arbitrator’s award was limited to
interpreting contractual terms whereas the NLRB’s award
was based on extra-contractual considerations. See 
id. at 646;
accord Miron 
Constr., 44 F.3d at 565
. In this case, by contrast,
there simply is no way to reconcile the JAB’s and NLRB’s
decisions: The JAB determined that ACS was bound by the
Principal Agreement to assign work to the Iron Workers; the
NLRB determined that ACS was not at any time relevant to
this appeal bound by the Principal Agreement, and, accord-
ingly, all work present and future belongs to the Bricklayers.
In this context, we believe that the principle that an arbitra-
tor’s award must give way to a conflicting § 10(k) determi-
nation by the NLRB is fully operative.
  The Iron Workers finally argue that the NLRB’s § 10(k)
decision was not in conflict with the JAB’s or district court’s
decision because the NLRB’s reasoning “focused only” on
whether ACS was a signatory to the Iron Workers’ Principal
Agreement (or another Iron Workers’ agreement) and did
not focus on whether ACS was bound by its course of
conduct. Appellant’s Br. at 25. The § 10(k) determination,
however, explained that, “[w]ith the exception of the project-
only agreements discussed above, which do not obligate the
Employer at any other sites, the Employer is not signatory
to or bound by any collective bargaining agreement with the
16                                     Nos. 03-3090 & 03-3104

Iron Workers.” R.12, Attachment at 4 (emphasis added). The
NLRB is obviously aware that an employer can commit
itself to an agreement by its course of conduct, see Bi-County
Wholesale Beverage Distribs. Labor Ass’n, 
291 N.L.R.B. 466
, 469
(1988) (finding course of conduct bound parties to agree-
ment); its decision, fairly read, simply did not find such a
course of conduct here. In any event, the correctness of the
NLRB’s methodology in its § 10(k) determination and of its
underlying rationale are not properly before us. See J.F.
White 
Contracting, 890 F.2d at 529
-30 (refusing to consider
two arguments “that, in effect, attack the validity of the
Board’s § 10(k) decision” because “it is well established that
N.L.R.B. determinations under section 10(k) are not directly
reviewable in this or any other court” (internal quotation
marks and citations omitted)). For our present purposes, the
only question is whether the NLRB’s ultimate decision
conflicts with the arbitrator’s award. As we have demon-
strated, there is such a conflict and, therefore, the arbitra-
tor’s award may not be enforced by the district court. 
Id. at 529
(“It is well-established law that courts are not to enforce
an arbitration award that conflicts with a § 10(k) determina-
         6
tion.”).


6
  The Iron Workers also claim that the § 10(k) determination is
not binding because the NLRB conducted its determination of
whether ACS was bound by the Principal Agreement under less
stringent standards. The Iron Workers submit that the NLRB’s
decision on the inapplicability of the Principal Agreement was
arrived at in its preliminary findings on the applicability of the
statute, and not in its decision on the merits of the dispute. On
the basis of our own scrutiny of the NLRB’s opinion, we cannot
accept this submission. See R.12, Attachment at 4 (noting in the
merits analysis that “the Employer is not signatory to or bound
                                                    (continued...)
Nos. 03-3090 & 03-3104                                            17

                           Conclusion
  For the foregoing reasons, we affirm the district court’s
decision to vacate the JAB’s award.
                                                         AFFIRMED
A true Copy:


6
  (...continued)
by any collective bargaining agreement”).
  In any event, the Iron Workers’ argument is without merit. To
determine whether the statute is applicable and thus whether a
dispute for work is properly before it, the NLRB must find: “[1]
there are competing claims for work, [2] that there is reasonable
cause to believe that § 8(b)(4)(D) has been violated, and [3] that
the parties have not agreed on a method for voluntary adjust-
ment of the dispute.” 
Id. at 3
; see also Miron 
Constr., 44 F.3d at 561
n.11. In Miron, this court refused to give weight to a finding “de-
signed to meet the Board’s decidedly low threshold requirement
that it find reasonable cause to believe that § 8(b)(4)(D) has been
violated.” Miron 
Constr., 44 F.3d at 564-65
. The Iron Workers
suggest that the NLRB also operates under an “decidedly low
threshold” in determining “[3] that the parties have not agreed on
a method for voluntary adjustment of the dispute”; therefore, as
in Miron, a court is not bound to give that finding preference if it
conflicts with an arbitrator’s award. Miron, however, addressed
a different prong of the test to determine whether § 10(k) applies:
whether there is “reasonable cause to believe § 8(b)(4)(D) has been
violated.” The difference is significant. The NLRB does not
attempt to decide whether there is “reasonable cause to believe the
parties have not agreed upon a method for voluntary adjustment
of the dispute,” but whether the parties have, in fact, made such
an agreement. This inquiry requires the NLRB to consider in
plenary fashion whether the parties bound themselves to an agree-
ment that contains a voluntary dispute mechanism. Accordingly,
the Iron Workers’ argument is unavailing.
18                             Nos. 03-3090 & 03-3104

     Teste:

                    _____________________________
                     Clerk of the United States Court of
                       Appeals for the Seventh Circuit




              USCA-02-C-0072—7-22-04

Source:  CourtListener

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