Ryan Iron Works, Inc. v. National Labor Relations Board

United States Court of Appeals
For the First Circuit

No. 00-2420

RYAN IRON WORKS, INC.,

Petitioner,

v.

NATIONAL LABOR RELATIONS BOARD,

Respondent.

NATIONAL SHOPMEN PENSION FUND; SHOPMEN’S
LOCAL 501 INTERNATIONAL ASSOCIATION OF BRIDGE,
STRUCTURAL AND ORNAMENTAL IRONWORKERS, AFL-CIO,

Intervenors.

ON PETITION FOR REVIEW AND CROSS-APPLICATION
FOR ENFORCEMENT OF AN ORDER OF THE
NATIONAL LABOR RELATIONS BOARD

Before

Lynch, Circuit Judge,

Coffin, Senior Circuit Judge,

and Schwarzer,* Senior District Judge.

Robert P. Corcoran, for petitioner.

*
Of the Northern District of California, sitting by designation.
 William M. Bernstein, Senior Attorney, with whom Leonard R.
Page, Acting General Counsel, John H. Ferguson, Associate General
Counsel, and Aileen A. Armstrong, Deputy Associate General Counsel,
were on brief, for respondent.
Marc H. Rifkind, with whom Lynn A. Bowers, Marc A. Tenenbaum,
Slevin & Hart, P.C., Mary T. Sullivan and Segal, Roitman & Coleman
were on brief, for intervenor.

_____________

July 16, 2001
____________
 SCHWARZER, Senior District Judge. Ryan Iron Works, Inc.

(Ryan) petitions for review of an order of the National Labor Relations

Board (Board) finding violations of Sections 8(a)(3) and (5) of the

National Labor Relations Act (Act), 29 U.S.C. §§ 158(a)(3) and (5).

The Board has cross-applied for enforcement of its order in which it

found that Ryan had committed a series of unfair labor practices during

negotiations for a new collective bargaining agreement (CBA) with the

bargaining representative of its employees, Shopmen’s Local 501,

International Association of Bridge, Structural and Ornamental

Ironworkers, AFL-CIO (the Union), and that an economic strike of its

employees was converted into an unfair labor practice strike following

an incident of direct dealing between Ryan’s president and one of its

workers. We affirm the Board’s order with respect to the unfair labor

practices but hold that the record lacks substantial support for the

finding that the strike was converted prior to its termination on

December 8, 1995. Accordingly, we grant the Board’s application in

part only.

FACTUAL BACKGROUND

Ryan is a corporation engaged in the fabrication of iron,

steel and metal products at its plant in Raynham, Massachusetts. It

has been party to a series of CBAs with Local 501 for more than twenty-

five years. The most recent CBA between the parties was in effect from

September 11, 1992, to September 10, 1995. The events giving rise to

-3-
this controversy occurred in the course of the negotiations for a

successor CBA.

The parties met in negotiations eight times from August 18

to November 10, 1995. The Union presented a list of demands, including

significant wage and benefits increases, and Ryan, in turn, proposed to

reduce wages and benefits in several areas. At the August 29 session,

Union representative David Mortimer (Mortimer) told Ryan’s negotiating

team that the company’s proposal was “an insult and a piece of garbage”

and that the Union “would not give up one cent” in givebacks or

concessions of any kind. Another Union official made a similar comment

at the August 31 session, where Ryan offered to increase its pension

and health insurance contributions, and reiterated that the Union would

not agree to any givebacks or concessions.

On September 7 the Union filed an unfair labor practice

charge against Ryan for failure to bargain in good faith, a charge that

was ultimately rejected by the Board. On September 8 the employees

voted to reject Ryan’s proposal. Because of the pendency of the

charge, the Union told its members that a strike would be an unfair

labor practice strike as opposed to an economic strike, meaning that

none of them could be permanently replaced.1 The members took a strike

1
Unlike economic strikers, unfair labor practices strikers are
entitled to reinstatement and back pay even if they have been replaced
during the strike. NLRB v. Harding Glass Co., Inc., 80 F.3d 7, 10 n.3
(1st Cir. 1997).

-4-
vote and went out on September 11, the day after the CBA expired. The

parties continued to meet, however, and at the September 18 session the

Union modified its proposal, reducing both its hourly wage and pension

fund contribution demands. Ryan rejected this proposal and on October

2 countered with a proposal which included an increase in vacation time

for certain employees and the shoe allowance but enlarged its right to

subcontract unit work. The Union rejected this proposal but made a

counterproposal for a three-year contract providing for increased wages

and pension contributions.

On October 23, Ryan’s president, Howard Shea (Shea), invited

Wallace Penniman (Penniman), who was walking the picket line with

twenty to thirty other striking employees, to take a ride to inspect

one of Ryan’s construction jobs. Penniman agreed and the two men drove

off. The parties dispute much of the content of the conversation

during that car trip. According to Penniman, Shea stated “that it was

the Union’s fault [that negotiations were going poorly] because they

weren’t negotiating with the Company” and asked what exactly the men

wanted. Penniman told Shea that the employees’ main concern was

seniority, and Shea responded that Ryan’s proposal on seniority was

merely a bargaining tool or a smokescreen to gain concessions. Shea

told Penniman “that [Ryan] was going to need another three-year pay

freeze to be competitive with the non-union shops.” The two men then

discussed the possible pay freeze, as well as vacations, holidays, work

-5-
boot allowances, subcontracting, pensions, health insurance and

arbitration. According to Penniman, the discussion was extensive,

lasting the entire drive to Waltham and back, a trip of about three

hours. Before dropping him off, Shea told Penniman that this was the

type of negotiating he was hoping for from the Union and said that

there were only a few items on Ryan’s list that it needed. As Penniman

got out of the car at the picket line, Shea told him “not to worry

about it, that it was going to be resolved.”

In his testimony, Shea admitted that he told Penniman that

the Union had refused to respond to any of the company’s proposals but

denied that there was any substantive discussion of Ryan’s bargaining

proposals. According to Shea, when Penniman asked him about the

negotiations, Shea told him they should not discuss them.

The Administrative Law Judge (ALJ) accepted Penniman’s

version of the conversation and found that Shea had dealt directly with

an individual employee concerning the negotiations, thereby unlawfully

bypassing and undermining the Union.

Penniman testified that the conversation led him to feel

optimistic about the possibility of a quick resolution and that he

shared it with the other picketers who saw him leave and return with

Shea. Later that day he told Union representative Mortimer about the

conversation and Mortimer arranged for another negotiating session on

October 25. The parties dispute whether the Union brought up the

-6-
Shea/Penniman conversation at that session. Ryan argues that there was

no mention of the incident and Mortimer testified as much, but Union

negotiator James Devlin testified that when he raised the question of

the differences between the positions taken by Ryan at the table and

those taken away from the table he was referring in part to the

Shea/Penniman incident. In any case, Ryan did not change its position.

When Union officials reported this to the employees, the employees

reacted with disappointment and anger. Having been led to believe that

an early resolution was in the offing, some blamed the Union for the

lack of progress.

On November 6 Ryan unilaterally altered the terms of

employment by implementing the changes in the CBA set out in its

October 2 proposal. On November 10 it also discontinued contributions

to the National Shopmen Pension Fund (Fund) required under the expired

CBA. At the final negotiating session on that same day, the Union

modified its earlier proposal and accepted some of Ryan’s proposals.

Ryan rejected the Union proposal and stood on its October 2 proposal.

On November 16 the Union withdrew its previous proposal and offered a

three-year extension of the expired contract with several wage freeze

concessions. On November 21 Ryan rejected that proposal but told the

Union that it was willing to meet to “discuss the significant

differences between them.”

On December 7 Ryan received a petition signed by fifty-five

-7-
employees stating that they no longer wished to be represented by the

Union and it notified the Union that it was therefore withdrawing

recognition from the Union. On December 8 the Union voted to end the

strike and faxed Ryan a letter offering the return of all striking

workers to their jobs by December 11. When the workers showed up they

were met by Shea, who told them there were no jobs for them.

STANDARD OF REVIEW

We grant the Board “deference with regard to its

interpretation of the Act as long as its interpretation is rational and

consistent with the statute.” NLRB v. Beverly Enters.-Mass., Inc., 174

F.3d 13, 22 (1st Cir. 1999). “The Board’s findings of fact are

conclusive if supported by substantial evidence on the record

considered as a whole.” Id. at 21. Substantial evidence is “such

relevant evidence as a reasonable mind might accept as adequate to

support a conclusion.” Universal Camera Corp. v. NLRB, 340 U.S. 474,

477 (1951) (citation omitted). The ultimate question is “