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United States Court of Appeals
FOR THE DISTRICT OF COLUMBIA CIRCUIT
Argued September 16, 2004 Decided October 26, 2004
No. 03-1343
EXXON CHEMICAL COMPANY,
PETITIONER
v.
NATIONAL LABOR RELATIONS BOARD,
RESPONDENT
Consolidated with
No. 03-1413
On Petition for Review and Cross–Application
for Enforcement of an Order of the
National Labor Relations Board
Tony P. Rosenstein argued the cause for petitioner. With
him on the briefs were Kathryn S. Vaughn and Joe Robert
Caldwell, Jr.
Bills of costs must be filed within 14 days after entry of judgment.
The court looks with disfavor upon motions to file bills of costs out
of time.
2
Richard A. Cohen, Senior Attorney, National Labor Rela-
tions Board, argued the cause for respondent. With him on
the brief were Arthur F. Rosenfeld, General Counsel, John
H. Ferguson, Associate General Counsel, Aileen A. Arm-
strong, Deputy Associate General Counsel, and Howard E.
Perlstein, Deputy Assistant General Counsel.
Before: GINSBURG, Chief Judge, and EDWARDS and ROGERS,
Circuit Judges.
Opinion for the Court filed by Circuit Judge ROGERS.
ROGERS, Circuit Judge: After Exxon Chemical Company
ceased operating its Bayway Chemical Plant in Linden, New
Jersey because it formed a joint venture, the union represent-
ing certain Bayway employees filed three grievances alleging
that Exxon had violated the parties’ collective bargaining
agreement (‘‘CBA’’). Exxon refused to arbitrate the griev-
ances. The National Labor Relations Board ruled that the
company had violated section 8(a)(1) and (5) of the National
Labor Relations Act (‘‘the Act’’), 29 U.S.C. § 158(a)(1), (5).
Relying on Velan Valve Corp., 316 N.L.R.B. 1273 (1995),
Exxon petitions for review on the principal ground that its
refusal to arbitrate was not an unfair labor practice as a
matter of law. We deny the petition for review and grant the
Board’s cross-application for enforcement of its Order.
I.
For over thirty years, the International Brotherhood of
Teamsters, Local 887 (‘‘the Union’’) represented the operat-
ing, mechanical, and maintenance employees at Exxon’s Bay-
way Chemical Plant. Exxon’s most recent CBA with the
Union took effect on March 2, 1996, and was scheduled to
expire on June 1, 1999, although it effectively terminated on
December 31, 1998, due to the formation of a joint venture
between Exxon and Shell Chemical Company. The formal
grievance/arbitration procedures outlined in Articles 20 and
21 of the CBA defined ‘‘grievance’’ as ‘‘a claim by an employ-
ee or the Union that the Company has violated an express
provision of this Agreement.’’ These provisions also provided
3
that ‘‘[a]lthough the Company hears a claim as a grievance, it
does not waive its right to take the position that the claim is
not a grievance.’’ The CBA also set time limits for the Union
to act or otherwise forfeit its right to arbitrate a grievance.
It further provided that ‘‘[w]hen an employee is to be laid off
TTT [he/she] will receive six (6) months notice’’ and a sever-
ance allowance. Finally, the CBA stated, in Article 5, that
‘‘[t]his Agreement does not affect the [Company’s] Benefit
Program[, including its] Thrift Plan TTT or the administration
thereof. This provision, however, is not a waiver of such
rights as the Union has to bargain concerning these pro-
grams.’’
In July 1996, Exxon announced to its employees that it was
forming a joint venture, Infineum, to which it intended to sell
its Bayway operation. On October 31, 1996, Exxon notified
the Union that all Bayway employees it represented would be
laid off when the joint venture became operational. Exxon
provided updates about the impending layoffs over the next
two years.
During that two-year period, Exxon and the Union engaged
in ‘‘effects’’ bargaining regarding the joint venture. The
parties principally discussed whether Infineum was bound by
the CBA and the extent to which it would hire the current
workforce, as well as the related issues of whether and when
Exxon would have to escrow or sequester monies to cover
severance payments. The information that the Union re-
ceived during these sessions about Infineum’s formation
caused it to file numerous grievances and unfair labor prac-
tice charges, including alleging that Exxon had improperly
denied severance pay and retirement benefits to employees
after its notice of layoff. The ‘‘effects’’ bargaining resulted in
an agreement on November 24, 1998 (‘‘November Agree-
ment’’). The Union agreed to withdraw its pending griev-
ances and unfair labor practice charges ‘‘relating to the
formation of Infineum’’ and ‘‘not to initiate or reinstitute
these or substantially similar claims against Exxon in any
forum whatsoever.’’ Exxon, in turn, provided job assurances
for nine unit employees and agreed to pay all employees until
December 31, 1998. The agreement also stated that the
4
Union and Infineum would begin meeting with the aim of
reaching a collective bargaining agreement by December 31,
1998, a task they accomplished on December 20, 1998.
On December 31, 1998, the last day Exxon operated its
Bayway plant, Exxon laid off all unit employees and gave
them their final paychecks, including severance pay. Exxon,
however, did not provide a 6% matching contribution to the
Thrift Fund for the severance pay as it did for regular pay,
and it also decided to transfer the Thrift Fund to Infineum.
On January 29, 1999, the Union orally notified Exxon of three
grievances to be filed; written notification followed the next
day. The grievances complained that Exxon (1) failed to
provide the contractually-required six months’ notice before
layoff, (2) failed to match the employees’ thrift contributions
from severance payments, and (3) unilaterally decided to
transfer the employees’ thrift accounts to the Infineum sav-
ings plan. Exxon did not respond initially in writing to the
grievances.
In a March 26, 1999, letter to William Goodhart, an Exxon
labor relations coordinator, Union trustee Al DeFreece for-
mally requested arbitration on behalf of the Union. Exxon
responded by letter of April 29, 1999, with Goodhart rejecting
the request for arbitration on the grounds that the grievances
were untimely, the November Agreement precluded the no-
tice grievance, and the grievances relating to the thrift ac-
counts were either raised or should have been raised during
‘‘effects’’ bargaining. DeFreece responded by letter of May
12, 1999, requesting arbitration and that Exxon make ar-
rangements to select arbitrators. Upon receiving no re-
sponse from Exxon, the Union’s attorney attempted to obtain
a designation by the American Arbitration Association
(‘‘AAA’’). Goodhart responded by letter of July 2, 1999, that
the grievances were not arbitrable, and Exxon’s attorney
reiterated this position by letters of July 6, July 26, and
August 10, 1999, in response to the Union’s continued attempt
to pursue arbitration through the AAA. When the AAA
declined to proceed with arbitration, the Union filed an unfair
labor practice charge on September 1, 1999, alleging that
5
Exxon refused to abide by the CBA’s grievance/arbitration
process to resolve the grievances.
After an evidentiary hearing, an Administrative Law Judge
(‘‘ALJ’’) found that the charge was timely because the Union
did not have ‘‘clear and unequivocal notice of a violation of the
Act’’ prior to March 1, 1999 (six months before the charge
was filed on September 1), and that the ‘‘grievances are
clearly covered by the grievance-arbitration provisions under
the collective bargaining agreement.’’ The Board agreed the
charge was timely and, over Chairman Battista’s dissent, also
agreed that by refusing to select an arbitrator and to arbi-
trate the grievances, Exxon unilaterally abandoned or repudi-
ated the grievance/arbitration procedure in violation of sec-
tion 8(a)(1) and (5). The Board ordered Exxon to, among
other things, submit the three grievances to arbitration and
participate in the selection of an arbitrator. Exxon now
petitions for review and the Board has filed a cross-
application for enforcement of its Order.
II.
Under section 8(a)(5) of the Act, it is an unfair labor
practice for an employer to refuse to bargain with its employ-
ees’ chosen representative, 29 U.S.C. § 158(a)(5), and an
employer who violates section 8(a)(5) also, derivatively, vio-
lates section 8(a)(1). See NLRB v. Centra, Inc., 954 F.2d 366,
367 n.1 (6th Cir. 1992); NLRB v. Newark Morning Ledger
Co., 120 F.2d 262, 265 & n.1 (3d Cir. 1941); cf. Metro Edison
Co. v. NLRB, 460 U.S. 693, 698 n.4 (1988). The court will
uphold the Board’s decision whether to assert jurisdiction
over an employer’s refusal to arbitrate so long as it is rational
and consistent with the Act, and the Board’s reasoning is
adequate, rational, and not arbitrary. DaimlerChrysler Corp.
v. NLRB, 288 F.3d 434, 444–45 (D.C. Cir. 2002); see also
Carey v. Westinghouse Elec. Corp., 375 U.S. 261, 271 (1964).
While the Board’s interpretation of the scope of the parties’
contractual agreement is subject to de novo review, Litton
Fin. Printing Div. v. NLRB, 501 U.S. 190, 202–03 (1991), its
findings of fact are conclusive if supported by substantial
6
evidence in the record as a whole, Perdue Farms, Inc. v.
NLRB, 144 F.3d 830, 834–35 (D.C. Cir. 1998); see also
Universal Camera Corp. v. NLRB, 340 U.S. 474, 488 (1951).
The court will overturn the Board’s adoption of the ALJ’s
credibility determinations only if they ‘‘are ‘hopelessly incred-
ible,’ ‘self contradictory,’ or ‘patently unsupportable.’ ’’ Cad-
bury Beverages, Inc. v NLRB, 160 F.3d 24, 28 (D.C. Cir.
1998) (quoting Capital Cleaning Contractors, Inc. v. NLRB,
147 F.3d 999, 1004 (D.C. Cir. 1998)).
We address at the outset Exxon’s contention that the unfair
labor practice charge was barred by the six-month limitations
period in section 10(b) of the Act, 29 U.S.C. § 160(b). The
statute begins to run when the unfair labor practice occurs.
Leach v. NLRB, 54 F.3d 802, 806–07 (D.C. Cir. 1995); Team-
sters Local Union No. 42 v. NLRB, 825 F.2d 608, 614–16 (1st
Cir. 1987); NLRB v. Al Bryant, Inc., 711 F.2d 543, 547 (3rd
Cir. 1983). Here, the unfair labor practice is Exxon’s refusal
to arbitrate. As the record makes clear, the Union did not
request, and the employer therefore could not have refused,
arbitration until March 26, 1999, which was less than six
months before the Union filed the charge. Therefore, the
unfair labor practice charge is timely.
As to the merits of the unfair labor practice, Exxon first
contends that the Board erred as a matter of law in focusing
on whether the three grievances were potentially covered by
the CBA, when the question is whether the employer engaged
in a wholesale repudiation of the contract. In its view, the
three grievances represented, ‘‘at most,’’ Petitioner’s Br. at
12, a ‘‘narrow class’’ under Velan Valve.
The Board has long had a policy of deferring its unfair
labor practice jurisdiction prospectively to an agreed upon
arbitration procedure, where, for example, the dispute turns
on an application of a CBA’s terms. See Hammontree v.
NLRB, 925 F.2d 1486, 1490–91 (D.C. Cir. 1991) (en banc)
(citing Collyer Insulated Wire, 192 N.L.R.B. 837, 842 (1971));
cf. Util. Workers Union v. NLRB, 39 F.3d 1210, 1213 (D.C.
Cir. 1994) (citing Spielberg Mfg. Co., 112 N.L.R.B. 1080
(1955)). Velan Valve is an example of when the Board will
7
conclude that the interests favoring collective bargaining as
an essentially private process are best served by the Board’s
nonintervention, leaving the aggrieved party to seek specific
performance of the duty to arbitrate through the courts
under section 301 of the Labor Management Relations Act, 29
U.S.C. § 185. In that case, the Board found no section
8(a)(5) violation where an employer had a good faith belief
that a single grievance was not timely under a five-day
limitations period in the parties’ CBA. Velan Valve, 316
N.L.R.B. at 1273–74. The union had filed a subcontracting
grievance more than thirty days after the employer had
advised it about the subcontracting of janitorial work. Id. at
1273. The employer, though citing its long standing policy
and intent to resolve grievances by arbitration, declined to do
so in this instance because the subcontracting grievance was
untimely under the parties’ agreement and, in any event,
lacked merit. Id. The Board, with one member dissenting,
concluded that under these circumstances the employer’s
‘‘refusal involves precisely that type of narrow, fact-bound,
contractual dispute that more properly should be handled by
the parties through the contract-dispute mechanism, and not
by recourse to the Board.’’ Id. at 1274. The employer had
not announced a broad policy of refusing to arbitrate griev-
ances generally, had participated at each step of the griev-
ance proceeding, and had reassured the union that it re-
mained committed to processing grievances under the parties’
contract, including arbitration. Id.
Exxon would have the Velan Valve analysis apply on the
grounds that the three grievances were simultaneously filed
and are a ‘‘narrow class’’ relating to the transition of employ-
ees to Infineum. However, in its Decision, the Board ade-
quately distinguished Velan Valve:
[T]he Board [in Velan Valve] emphasized that the
employer, at the time of its refusal to arbitrate
grievances, reassured the union of its commitment to
the collective-bargaining agreement and to good-
faith dealing with the union. [Exxon] here provided
no such assurances. Rather, it repeatedly ignored
8
the Union’s request to respond to the Union’s arbi-
tration requests.
Exxon Chemical Co., 340 N.L.R.B. No. 51, at 3 (Sept. 29,
2003).
The Board noted that the three grievances, unlike the
single grievance in Velan Valve, ‘‘implicated a range of con-
tractual issues, [are] not a narrow class of issues, and consti-
tuted the totality of collective-bargaining issues pending be-
tween the parties.’’ Id. While Exxon adopts the position of
the dissenting member that there was only a breach of
contract claim remediable under section 301, that conduct
may constitute a breach remediable in the courts does not
mean that the Board may not proscribe it as an unfair labor
practice. NLRB v. Strong Roofing & Insulating Co., 393
U.S. 357, 361 (1969). The Board quite reasonably found it
significant that the parties were in an end-game situation.
Exxon had sold the facility, ended its relationship with unit
employees, and walked away from what was left of the CBA
during a time when unit employees and the Union were most
vulnerable. Cf. Fall River Dyeing & Finishing Corp. v.
NLRB, 482 U.S. 27, 39–40 (1987).
Second, Exxon contends that ‘‘good faith,’’ not arbitrability,
is the relevant issue. Although good faith may be a relevant
consideration, the standard for determining whether a partic-
ular refusal to arbitrate violates section 8(a)(5) remains
whether the employer’s conduct is ‘‘tantamount to a wholesale
repudiation,’’ Velan Valve, 316 N.L.R.B. at 1274, or consti-
tutes a ‘‘unilateral modification’’ of the collective bargaining
agreement ‘‘by imposing a noncontractual condition that [the
employer] would arbitrate only those grievances that it decid-
ed should go to arbitration.’’ 3 State Contractors, Inc., 306
N.L.R.B. 711, 715 (1992). This is the standard that the Board
applied. Exxon’s contention that it was misled by Velan
Valve as to the standards for Board intervention for refusals
to arbitrate is unpersuasive because, as the Board discussed,
Exxon’s refusal to arbitrate three grievances on a variety of
grounds in an end-game situation is quite different than the
employer’s decision in Velan Valve not to arbitrate a single
9
grievance on a single procedural ground. Amalgamated
Clothing Workers v. NLRB, 343 F.2d 329 (D.C. Cir. 1965),
cited by Exxon, did not involve an abandonment of the
arbitration provisions of the CBA, but instead the employer,
based on erroneous legal advice, refused to arbitrate a single
grievance unless the union dropped parallel unfair labor
practice charges. Exxon’s reliance on Microimage Display v.
NLRB, 924 F.2d 245 (D.C. Cir. 1991), is equally unavailing
because the Board found that the employer never refused to
arbitrate the particular grievance. See id. at 250.
Third, Exxon contends that the disputed grievances were
not arbitrable under the CBA. Although Exxon correctly
states that ‘‘a party cannot be forced to arbitrate the arbitra-
bility question,’’ Litton Fin., 503 U.S. at 208–09, courts con-
strue arbitration clauses broadly, resolving doubts in favor of
coverage. United Steelworkers v. Warrior & Gulf Naviga-
tion Co., 363 U.S. 574, 582–83 (1960). Exxon invokes Article
5 of the CBA and the waiver of claims provision in the
November Agreement to maintain that the grievances were
not substantively arbitrable. Neither provision, however, is a
clear statement excluding any of the subjects raised by the
three grievances from arbitration, see AT&T Technologies,
Inc. v. Communications Workers, 475 U.S. 643, 650 (1986),
and Exxon presented no evidence that the language in Article
5 was intended to give it the unfettered right to convert
employee accounts to a different company without bargaining.
Moreover, ‘‘[o]nce it is determined TTT that the parties are
obligated to submit the subject matter of a dispute to arbitra-
tion, ‘procedural’ questions that grow out of the dispute and
bear on its final disposition should be left to the arbitrator.’’
John Wiley & Sons v. Livingston, 376 U.S. 543, 557 (1964);
see also Howsam v. Dean Witter Reynolds, Inc., 537 U.S. 79,
84 (2002). Therefore, as the Board ruled, Exxon’s objections
that the three grievances were untimely under the contract,
and its claims of waiver and estoppel based on the November
Agreement, are properly for the arbitrator to revolve. Exx-
on’s assertion that the grievances concerned matters that on
their face are of no consequence, and therefore were brought
10
in bad faith, requires no response. See AT&T Technologies,
475 U.S. at 649–50.
Finally, Exxon contends that it did not receive a fair
hearing for two reasons, neither of which has merit. To the
extent Exxon claims the ALJ excluded evidence of its good
faith, Exxon has not met its burden of demonstrating preju-
dice, see Desert Hospital v. NLRB, 91 F.3d 187, 190 (D.C.
Cir. 1996). The ALJ made clear at the hearing that he would
rule based solely upon the parties’ written correspondence
after the grievances were filed. In limiting the period during
which Exxon’s good faith was relevant, the ALJ reasonably
exercised his discretion to exclude Exxon’s evidence that
related to its claims of waiver and estoppel, which, as dis-
cussed, are for the arbitrator to resolve. See Food Stores
Employees Union, Local 347 v. NLRB, 422 F.2d 685, 692
(D.C. Cir. 1969). Exxon’s other objection, that the ALJ
prohibited it from adequately testing DeFreece’s credibility,
is belied by the record, for the ALJ allowed Exxon to test
DeFreece’s credibility on the only issue as to which it was
relevant, the section 10(b) claim.
Accordingly, we deny the petition for review and grant the
Board’s cross-application for enforcement of its Order.