National Labor Relations Board v. Oklahoma Installation Co.

F I L E D
United States Court of Appeals
Tenth Circuit
PUBLISH
JUL 10 2000
UNITED STATES COURT OF APPEALS
PATRICK FISHER
Clerk
TENTH CIRCUIT

NATIONAL LABOR RELATIONS
BOARD,
Petitioner,
v. No. 98-9524
OKLAHOMA INSTALLATION
COMPANY,

Respondent.

ON PETITION TO ENFORCE ORDER OF THE
NATIONAL LABOR RELATIONS BOARD
(Case No. 17-CA-18500)

Robert J. Englehart, Attorney (David A. Fleischer, Senior Attorney; Frederick L.
Feinstein, Acting General Counsel; Linda Sher, Associate General Counsel; and
John D. Burgoyne, Acting Deputy Associate General Counsel, on the brief),
National Labor Relations Board, Washington, D.C., for Petitioner.

Stephen L. Andrew (D. Kevin Ikenberry with him on the briefs) of Stephen L.
Andrew & Associates, Tulsa, Oklahoma, for Respondent.

_________________________

Before HENRY, McKAY, and ANDERSON, Circuit Judges.
_________________________

McKAY, Circuit Judge.
_________________________
 The National Labor Relations Board petitions for enforcement of the

Decision and Order it issued to Respondent Oklahoma Installation Company

[Company] on May 14, 1998, finding that the Company recognized the United

Brotherhood of Carpenters & Joiners Local Union No. 943 [Union] as a 9(a)

representative and “therefore had a continuing obligation to recognize and bargain

with the Union, and to adhere to the terms of the parties’ expired contract.”

Oklahoma Installation Co., 325 N.L.R.B. 741, 741 (1998). The Board ruled that

the Company violated § 8(a)(1) and (5) of the National Labor Relations Act

[NLRA or Act]. See id. at 742. We exercise jurisdiction under 29 U.S.C.

§ 160(e).

I.

Oklahoma Installation Company is a construction industry employer

engaged in commercial remodeling and the installation of retail store fixtures. On

February 26, 1993, the Company signed a Recognition Agreement and Letter of

Assent with the Union. 1 See R., Vol. II, Resp’t Ex. 21. By executing this

1
The Recognition Agreement was the product of a settlement between the
Union and two companies, Oklahoma Installation Company and Oklahoma Fixture
Company. In 1992, after a Board-conducted election, the Union was certified as
the 9(a) representative of a unit of Oklahoma Fixture’s employees. Subsequently,
the Union filed charges against the two companies alleging that they were alter
egos or a single employer. Before that matter came to trial in 1993, Oklahoma
(continued...)

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Recognition Agreement, the Company agreed to be bound to a collective

bargaining agreement between the Union and the Oklahoma Fixture Company,

until the Company terminated the Recognition Agreement “by giving written

notice to the Union . . . at least 150 days prior to the then-current anniversary date

of the [above referenced] collective bargaining agreement.” Id. at 2. The

Recognition Agreement also included a clause stating, “The Union has submitted,

and the Employer is satisfied that the Union represents a majority of its

employees in a unit that is appropriate for collective bargaining.” Id. at 1. The

Company had no employees working within the Union’s jurisdiction when it

entered into this agreement in February 1993. See R., Vol. III, Doc. 1 at 2.

The parties performed according to the Recognition Agreement and the

underlying collective bargaining agreement until the collective bargaining

agreement expired on May 31, 1995. Two months later, in August 1995, the

Company began work on a project within the Union’s jurisdiction but did not

employ carpenters through the Union’s hiring hall. Instead, the Company paid its

carpenters wages lower than the contract rate and stopped making payments to the

Union’s fringe benefits funds. In response to the Company’s actions, the Union

filed unfair labor practice charges and the Board issued a complaint against the

1
(...continued)
Installation agreed to execute the Recognition Agreement, which settled the
parties’ dispute. See R., Vol. III, Doc. 1 at 2.

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Company, alleging that it had failed to maintain the terms and conditions of

employment set forth in the expired agreement between the Union and the

Oklahoma Fixture Company and failed and refused to bargain with and recognize

the Union in violation of § 8(a)(1) and (5) of the Act. The Company denied the

allegations.

The matter was heard before an administrative law judge who determined

that the relationship between the Company and the Union was governed by § 8(f)

of the Act, not § 9(a), because “no election [was] won by the Union among

Respondent’s employees and [there was] no showing of majority support for the

Union among [the same] employees.” Id. at 5. The judge further concluded that

because the underlying collective bargaining agreement had expired the Company

was free to repudiate the 8(f) relationship and withdraw recognition from the

Union, as it did. See id.

A divided Board rejected the conclusions of the administrative law judge.

Chairman Gould and Member Fox held that the language of the Recognition

Agreement sufficiently demonstrated that the Company recognized the Union as

the exclusive representative of the Company’s employees under § 9(a). See

Oklahoma Installation, 325 N.L.R.B. at 741-42. Therefore, the majority

concluded, the Company’s withdrawal from the Union, its refusal to bargain with

the Union, and its unilateral actions changing the terms and conditions of

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employment violated § 8(a)(1) and (5) of the Act. See id. at 742.

Member Hurtgen, however, dissented and would have dismissed the

complaint because he did not agree that the Union was a 9(a) representative of the

Company’s employees. Relying on the fact that “there was no contemporaneous

showing of majority support . . . [and that] the language of the contract [did] not

clearly state that there was such a showing,” id. at 744, Member Hurtgen

concluded that the Recognition Agreement did not unambiguously indicate that

the employer extended § 9(a) recognition to the Union. See id. Because the

persons who might attack § 9(a) recognition “were not on clear notice that a

Section 9 relationship was intended,” id., he also concluded that § 10(b) of the

Act, which applies a six-month bar to attacks on majority status, did not apply in

this case.

In reviewing the Board’s decision, we are guided by the substantial

evidence standard. According to § 10(e) of the Act, 29 U.S.C. § 160(e), the

Board’s findings of fact should be upheld if they are supported by substantial

evidence in the record as a whole. See Universal Camera Corp. v. NLRB, 340

U.S. 474, 488 (1951); NLRB v. American Can Co., 658 F.2d 746, 753 (10th Cir.

1981). “If the Board adopts a rule that is rational and consistent with the Act,

then the rule is entitled to deference from the courts.” Fall River Dyeing &

Finishing Corp. v. NLRB, 482 U.S. 27, 42 (1987) (citation omitted); see, e.g.,

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NLRB v. Curtin Matheson Scientific, Inc., 494 U.S. 775, 786-87 (1990).

However, the Board’s interpretation of contract language is not entitled to any

deference. See Litton Fin. Printing Div. v. NLRB, 501 U.S. 190, 202-03 (1991).

II.

The issues in this case are identical to those raised in a companion case,

NLRB v. Triple C Maintenance, Inc., F.3d (10th Cir. 2000). They are

(1) whether the relationship between the union and the employer was governed by

§ 8(f) or § 9(a) of the Act, and (2) whether § 10(b) precludes the employer from

attacking the formation of a 9(a) relationship. In Triple C Maintenance, we

decided that the correct approach to answering these questions would be as

follows: First, “because the party asserting the existence of a 9(a) relationship

has the burden to prove its existence,” we must “examine whether the bargaining

agreement, on its face, demonstrates that the parties intended to form a 9(a)

relationship as opposed to one governed by § 8(f).” Id., Op. at 6. Only when we

determine that the agreement unambiguously shows that

a 9(a) relationship was intended, which means that the parties had
sufficient notice that § 9(a) governs their agreement, [do] we
examine whether a challenge to the 9(a) status, and its presumption
of majority support, is reasonably restricted by a period of limitations
under § 10(b) or otherwise.

Id. at 7. Conversely, if we determine that the parties did not have clear notice

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that a 9(a) relationship was intended, then the presumption in favor of § 8(f) was

never rebutted and it is not necessary to consider the applicability of a time bar.

Board precedent mandates that the party asserting the existence of a 9(a)

relationship has the burden to prove it because a contract formed between a union

and a construction industry employer is presumed to be governed by § 8(f). See

Casale Indus., Inc., 311 N.L.R.B. 951, 952 (1993); John Deklewa & Sons, Inc.,

282 N.L.R.B. 1375, 1385 n.41 (1987), enforced sub nom. International Ass’n of

Bridge, Structural & Ornamental Iron Workers v. NLRB, 843 F.2d 770 (3d Cir.

1988). This burden may be met in two ways. The party either may conduct a

Board-certified election or it may obtain the employer’s voluntary recognition of

the union as the employees’ exclusive majority bargaining agent. See Deklewa,

282 N.L.R.B. at 1387 n.53; accord NLRB v. Goodless Elec. Co., 124 F.3d 322,

328 (1st Cir. 1997). When attempting to prove a 9(a) relationship through the

latter method, a party must show three things: (1) the union’s unequivocal

demand for recognition as a 9(a) representative; (2) the employer’s unequivocal

and voluntary grant of such recognition; and (3) a contemporaneous showing of

majority support. See Goodless Elec. Co., 321 N.L.R.B. 64, 65-66 (1996); rev’d

on other grounds, 124 F.3d at 328; Golden West Elec., 307 N.L.R.B. 1494, 1495

(1992); J & R Tile, Inc., 291 N.L.R.B. 1034, 1036 & n.11 (1988).

In Triple C Maintenance, Op. at 15, we decided that the third element

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requiring a contemporaneous showing of majority support may be satisfied by

language in a bargaining agreement where that language “unequivocally

demonstrates that the parties intended to be governed by § 9(a).” We held that the

contractual language met this standard by showing that the Union wanted to be

recognized as a 9(a) representative, reciting that the employer “‘recognize[s] [the

Union] as the sole and exclusive agent for . . . a unit [of employees] appropriate

for bargaining within the meaning of Section 9(a),’” and stating that the

employer’s recognition is based on its acknowledgment or acceptance of some

proof or “‘clear showing of majority support.’” Id., Op. at 15 (citation omitted).

In short, the language of the recognition clause itself was evidence that a 9(a)

relationship was contemplated by the parties and that a showing of majority proof

had been actually made or offered. As a result, we ruled that the contract

language was sufficient to satisfy the requirement of a contemporaneous showing

of majority support and therefore establish a 9(a) relationship. See id., Op. at 17.

The critical question, then, is whether the Recognition Agreement in this

case unequivocally and unambiguously illustrates that the parties intended to be

governed by § 9(a) rather than by § 8(f). The Recognition Agreement contained

one paragraph stating that “[t]he Union has submitted, and the Employer is

satisfied that the Union represents a majority of its employees in a unit that is

appropriate for collective bargaining.” R., Vol. II, Resp’t Ex. 21 at 1. The

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Recognition Agreement also states, “The Employer recognizes the Union as the

exclusive collective bargaining agent for its employees who perform carpentry

and construction work within the jurisdiction of the Union on all present and

future job sites.” Id. Unlike the contractual language in Triple C Maintenance,

the language here falls short of the requisite standard–it does not “‘conclusively

give[] notice that a 9(a) relationship is intended’” for several reasons. Triple C

Maintenance, Op. at 16 (quoting Sheet Metal Workers’ Internat’l Ass’n Local 19

v. Herre Bros., Inc., 201 F.3d 231, 242 (3d Cir. 1999)).

First, although the document at issue is titled “Recognition Agreement and

Letter of Assent,” nowhere does it state that the Company extends recognition to

the Union as a 9(a) representative. It is not sufficient to state that an employer

“recognizes” a union as an exclusive collective bargaining agent without other

language showing that the recognition is based on § 9(a). The collective

bargaining agreements that have been found to establish a 9(a) relationship by the

terms of their language have all utilized language which, beyond merely reciting

key words such as “recognize” and “acknowledge and confirm,” conclusively

shows that the recognition was based on § 9(a). See, e.g., id., Op. at 15 (“[The

employer] ‘recognize[s] [the Union] as the sole and exclusive bargaining

agent . . . pursuant to Section 9(a) . . . .’” (citation omitted)); Sheet Metal

Workers’, 201 F.3d at 242 (concluding that contract language establishes a 9(a)

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relationship in part because language states that “‘the Employer recognizes the

Union as the exclusive Collective Bargaining Unit . . . unless and until such time

as the Union loses its status as the employees exclusive representative as a result

of an N.L.R.B. election requested by the employees’” and because union’s

presumed majority status coupled with employee-requested election is part of

structure of § 9(a) agreements (citation omitted)); MFP Fire Protection, Inc., 318

N.L.R.B. 840, 841 (1995) (“The Employer therefore unconditionally

acknowledges and confirms that [the Union] is the exclusive bargaining

representative . . . pursuant to Section 9(a) of the [Act].”), enforced on other

grounds, 101 F.3d 1341, 1343 (10th Cir. 1996); Decorative Floors, Inc., 315

N.L.R.B. 188, 188 (1994) (“[T]he Employer recognizes, pursuant to Section

[9(a)] . . . , the Union as the sole and exclusive bargaining representative . . . .”);

Triple A Fire Protection, Inc., 312 N.L.R.B. 1088, 1088 (1993) (“The Employer

therefore unconditionally acknowledges and confirms that [the Union] is the

exclusive bargaining representative . . . pursuant to Section 9(a) of the [Act].”),

enforced 136 F.3d 727 (11th Cir. 1998), cert. denied, 525 U.S. 1067 (1999); cf. J

& R Tile, 291 N.L.R.B. at 1037 (determining that relationship was not governed

by § 9(a) primarily because there was no evidence that the union sought and the

employer granted recognition as a 9(a) representative). The Recognition

Agreement in this case does not show either by reference to § 9(a) or by other

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language that the Company unequivocally granted § 9(a) recognition to the Union.

While we acknowledge that the differences between this case and Triple C

Maintenance are narrow, one of the patent differences is that the recognition

clause in Triple C Maintenance utilized precise language, including reference to

§ 9(a), to demonstrate unequivocally that governance by § 9(a) was intended. See

Triple C Maintenance, Op. at 16. Though the lack of a specific reference to

§ 9(a) is not fatal if the rest of the agreement conclusively notifies the parties that

a 9(a) relationship is intended, see id., Op. at 16 n.3, in this case the absence of

any reference to § 9(a) compounds the ambiguity of the recognition clause. Its

absence indeed illustrates the jeopardy in which the proponent of the 9(a)

relationship (i.e., the Union in this case) places itself, and we cannot ascertain

from the face of the agreement precisely what the parties intended.

Also in contrast to the language in Triple C Maintenance, the agreement

here does not recite that the Union submitted proof of majority status or that the

employer acknowledged the proof of majority support as the basis for its § 9(a)

recognition of the Union. See id., Op. at 15 (referring to language where the

employer “‘agree[d] that [its] recognition is predicated on a clear showing of

majority support for [the Union] indicated by [the] bargaining unit employees’”

(citation omitted)); see also Sheet Metal Workers’, 201 F.3d at 242 (relying on

language stating that “‘the Union has submitted proof and the Employer is

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satisfied that the Union represents a majority of its employees’” (citation

omitted)); Decorative Floors, 315 N.L.R.B. at 188 (finding a 9(a) relationship

from language stating that the union offered to show the employer its employees’

authorization cards and that the employer was satisfied that the union represented

a majority of its employees within the meaning of § 9(a)). The requirement of a

contemporaneous showing of majority support is not satisfied by the contractual

language in the Recognition Agreement.

Finally, the Board appears to argue that the use of the word “submitted”

means that the Union in fact submitted proof of majority support. Another logical

reading of that word within the sentence in which it was used is simply that the

Union asserted that it represents a majority of the employer’s employees. Thus,

the use of the word “submitted” is not determinative but, to the contrary,

demonstrates another measure of the ambiguity of the language in the Recognition

Agreement. In fact, because § 8(f) agreements may also contain language

indicating that a union exclusively represents a majority of the employees, see J &

R Tile, 291 N.L.R.B. at 1036 & n.11, it is impossible to tell from the face of the

Recognition Agreement whether the parties intended to apply § 8(f) or § 9(a). Cf.

American Automatic Sprinkler Sys., Inc. v. NLRB, 163 F.3d 209, 222 (4th Cir.

1998) (warning that if the Board or a court were to credit § 9(a) recognition

absent a contemporaneous showing or a description of a contemporaneous

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showing of majority support, voluntary recognition would be reduced “to a hollow

form”), cert. denied, U.S. , 120 S. Ct. 65 (1999).

We conclude that the majority Board’s construction of the language in the

Recognition Agreement, which is entitled to no deference, is not supported by the

substantial evidence in the record as a whole and is therefore erroneous. Because

it is not evident from the face of the Recognition Agreement that the Company

satisfied the requirements of voluntary § 9(a) recognition of the Union, the

presumption in favor of § 8(f) was not rebutted. 2 Accordingly, we hold that the

relationship between the Company and the Union was governed by § 8(f). The

Company therefore permissibly repudiated the relationship after the underlying

contract expired on May 31, 1995. As a result of our determination that the

contractual language in this case was not sufficient to rebut the presumption of an

8(f) relationship and establish a 9(a) relationship, we do not address whether

§ 10(b) or a similar period of limitations bars an employer from defending itself

against the Union’s claim of a 9(a) relationship. 3 This case makes clear that a

union cannot claim that a 9(a) relationship was formed and rely on § 9(a)’s

presumption of majority status if the purported recognition language does not

2
We note that, contrary to Member Hurtgen’s analysis, it is not necessary or
proper to examine the facts at the time the parties entered into the Recognition
Agreement. It is sufficient that the Union did not overcome the 8(f) presumption.
3
For our resolution of this issue in a companion case, see our recent
decision in Triple C Maintenance, Op. at 23-26.

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satisfy the three requirements of voluntary recognition and thereby give the

employer clear and unambiguous notice of the nature of its relationship with the

union.

We deny the Board’s petition for enforcement of its order, and we reverse

and remand for a remedial order consistent with this opinion.

DENIED, REVERSED AND REMANDED.

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