United States Court of Appeals
For the First Circuit
No. 01-1577
THOMAS J. HARRINGTON, RICHARD S. NEVILLE,
THOMAS FORDHAM, JOHN A. BIGGINS, MARK J. DURKIN,
Plaintiffs, Appellants,
v.
ELAINE L. CHAO, SECRETARY OF LABOR,
U.S. DEPARTMENT OF LABOR,
Defendants, Appellees.
APPEAL FROM THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MASSACHUSETTS
[Hon. Richard G. Stearns, U.S. District Judge]
Before
Torruella, Lynch, and Lipez, Circuit Judges.
Renee J. Bushey with whom Michael A. Feinberg and Feinberg,
Campbell & Zack, P.C. were on brief for appellants.
Alan Hyde for Association for Union Democracy, Inc., amicus
curiae.
J. Matthew McCracken, Attorney, United States Department of Labor,
with whom James B. Farmer, United States Attorney, and Anita Johnson,
Assistant United States Attorney, were on brief for appellees.
Daniel J. Hall with whom DeCarlo, Connor & Selvo, Aaron D. Krakow
and Krakow, Souris & Birmingham were on brief for United Brotherhood of
Carpenters and Joiners of America and New England Regional Council of
Carpenters, amici curiae.
February 19, 2002
LYNCH, Circuit Judge. This case comes to us under the union-
democracy provisions of the Labor Management Reporting and Disclosure
Act of 1959 ("LMRDA"), 29 U.S.C. §§ 401-531 (1994 & Supp. V 1999).
Thomas Harrington, a member of the United Brotherhood of
Carpenters and Joiners of America ("UBC"), alleges that the functions
and purposes traditionally accorded to local unions in the New England
region of the UBC are now served by the New England Regional Council.
That Council, he says, must be treated as a local union and not as an
intermediary body. Consequently, Harrington argues, the officers of
that Council must be elected in the manner that the LMRDA prescribes
for local unions, that is, by direct election by secret ballot among
the union members rather than by vote of delegates who are elected from
the local unions, as the UBC has chosen to do for the Council. Id. §
481(b),(d) (1994). Harrington filed a complaint with the Secretary of
Labor asking her to require the Council to hold a new election as a
local union. The Secretary declined for reasons stated in a brief
Statement of Reasons.
Harrington sued under the LMRDA. On motion by the Secretary,
the district court dismissed his suit. See Harrington v. Herman, 138
F. Supp. 2d 232 (D. Mass. 2001). Because the Statement of Reasons is
insufficient to permit meaningful judicial review, we reverse the
district court, vacate the Secretary's Statement of Reasons and remand
the case to the district court with instructions to remand to the
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Secretary. We do not now decide whether any refusal by the Secretary
to bring suit as sought by Harrington would be arbitrary or capricious.
I.
A.
The LMRDA, 29 U.S.C. §§ 401-531, was designed "to ensure that
unions would be democratically governed, and responsive to the will of
the union membership as expressed in open, periodic elections."
Finnegan v. Leu, 456 U.S. 431, 441 (1982); see also S. Rep. No. 86-187,
at 20 (1959) ("It needs no argument to demonstrate the importance of
free and democratic union elections."). The LMRDA balances this
purpose with the "countervailing policy recogniz[ing] that unions
should be free to conduct their affairs so far as possible and the
government should not become excessively involved in union politics."
Reich v. Local 89, Laborers' Int'l Union, 36 F.3d 1470, 1476 (9th Cir.
1994).
Title IV of the LMRDA, 29 U.S.C. §§ 481-483 (1994),
establishes minimum standards for the election of union officers. The
LMRDA provides that "[e]very local labor organization shall elect its
officers not less than once every three years by secret ballot among
the members." Id. § 481(b). However, these direct election
requirements do not apply to the selection of officers of "intermediate
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bodies" of labor organizations.1 Id. § 481(d). Instead, the Act
provides:
Officers of intermediate bodies, such as general committees,
system boards, joint boards, or joint councils, shall be
elected not less often than once every four years by secret
ballot among the members in good standing or by labor
organization officers representative of such members who
have been elected by secret ballot.
Id. § 481(d).2 Thus an intermediate body may choose between direct
election or representative election; UBC has chosen the latter.
When a union member wishes to challenge the validity of an
election, he must exhaust remedies available under the labor
organization's rules, and he may then file a complaint with the
1 "Labor organization," for purposes of the LMRDA, means:
a labor organization engaged in an industry affecting
commerce and includes any organization of any kind, any
agency, or employee representation committee, group,
association, or plan so engaged in which employees
participate and which exists for the purpose, in whole
or in part, of dealing with employers concerning
grievances, labor disputes, wages, rates of pay, hours,
or other terms or conditions of employment, and any
conference, general committee, joint or system board,
or joint council so engaged which is subordinate to a
national or international labor organization, other
than a State or local central body.
29 U.S.C. § 402(i).
2 The election of officers of national or international labor
organizations is also governed by Title IV. Under LRMDA § 401, such a
body must "elect its officers not less often than once every five years
either by secret ballot among the members in good standing or at a
convention of delegates chosen by secret ballot." 29 U.S.C. § 481(a).
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Secretary. Id. § 482(a). Upon receipt of a union member's complaint,
the Secretary investigates the allegations of that complaint. Id.
§ 482(b). If she determines that there is probable cause to believe
that a violation of Title IV occurred and that the violation probably
infected the outcome of the election, she must bring suit against the
labor organization to set aside the election and to obtain a new
election. Id.; Wirtz v. Local 153, Glass Bottle Blowers Ass'n, 389
U.S. 463, 472 (1968); see also Heckler v. Chaney, 470 U.S. 821, 834
(1985) (noting that § 482(b) "quite clearly withdrew discretion from
the agency and provided guidelines for exercise of its enforcement
power").
B.
In 1996, the UBC, an international union, undertook a
dramatic restructuring which established a new three-tier organization
of dominant and subordinate UBC bodies. The International remained at
the top of the organization. Below the International, the UBC
established a group of strong regional entities, called Regional
Councils. Lastly, the numerous existing UBC locals were placed at the
bottom, subordinate to both the International and the Regional
Councils. It appears that before July 1, 1996, the Regional Councils
did not exist.
The New England Regional Council ("NERC") covers UBC members
and subordinate UBC locals throughout Connecticut, Maine,
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Massachusetts, New Hampshire, Rhode Island, and Vermont. The officers
of NERC are not elected directly by local union members, but rather by
a secret ballot of delegates who are, in turn, elected by the members
of the local unions. The key officer of NERC is the Executive
Secretary-Treasurer; he has exclusive authority to submit grievances to
binding arbitration, hire or terminate NERC employees, chair the
collective bargaining committees, appoint the membership of collective
bargaining committees, and appoint the members of the trial committees
convened to discipline union members.
Although deprived of many of their previous functions, the
UBC locals subordinate to NERC remain independently chartered, have
identifiable memberships, elect their own officers, and have their own
by-laws. Although the locals do not negotiate collective bargaining
agreements, the membership of the locals must vote to ratify the
agreements. The locals hold meetings, have their own budgets and bank
accounts, and collect members' dues (a substantial portion of which are
then passed on to NERC). Each local is permitted to hire one clerical
staff member. Grievances are administered in the early, informal
stages by local stewards, but the locals cannot invoke higher levels of
the grievance process, including arbitration.
Harrington, a UBC member in Massachusetts, filed a complaint
with the Secretary of Labor on September 21, 1999, pursuant to 29
U.S.C. § 482 and 29 C.F.R. § 452.4 (2001), alleging that NERC was
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essentially a "local" labor organization because it had assumed most of
the powers and functions traditionally retained by UBC locals.
Harrington contended that because NERC is a "local," it must elect its
officers by direct vote of the local union members, and not by vote of
delegates from the local unions, in order to comply with the LMRDA.3
After conducting an investigation, the Secretary concluded
in a Statement of Reasons dated April 7, 2000, that NERC is an
"intermediate body," not a "local," and is therefore permitted to elect
its officers either by "secret ballot among the members in good
standing or by labor organization officers representative of such
members who have been elected by secret ballot." 29 U.S.C. § 481(d).
In the Statement of Reasons, the Secretary noted that NERC's
bylaws invested it with some of the powers and functions that the
union's locals previously possessed, but that this was insufficient
ground upon which to regard NERC as a local rather than as an
intermediate body.4 The Secretary stated that there was "no basis in
the statute or legislative history for concluding that if intermediate
bodies possess certain functions and powers," they lose the statutory
3 In an ironic turn of events, we were informed that Harrington
was recently elected Executive Secretary-Treasurer of NERC. This fact
does not affect our disposition of the case.
4 The full text of the Secretary's Statement of Reasons is set
forth in an appendix to this opinion.
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choice of electing officers indirectly and must elect their officers
directly. The Secretary concluded that because the investigation found
no violation of law in the method by which NERC elected its officers,
there was no basis for bringing suit against NERC.
Harrington then filed suit in United States district court
challenging the Secretary's refusal to file an enforcement action. On
April 10, 2001, the district court granted the Secretary's motion to
dismiss, reasoning that the Secretary's decision not to initiate suit
was not arbitrary or capricious. Harrington, 138 F. Supp. 2d at 235-
36. Harrington promptly filed this appeal.
II.
A.
Harrington's principal argument is that the Secretary, in
refusing to sue NERC, has retreated without explanation from her prior
policies regarding the enforcement of direct election standards.
Specifically, Harrington contends that the Secretary's current position
is directly at odds with her established position -- as expressed in
the regulations and case law -- of enforcing the direct election
provisions of 29 U.S.C. § 481(b) against so-called intermediate bodies
that have, in reality, assumed all of the functions of a local union.
Harrington is supported by amicus curiae Association for Union
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Democracy, Inc, while the UBC and NERC, acting as amici curiae, support
the Secretary.5
The Secretary denies any inconsistency and also contends that
her action is justified by the LMRDA's broad purposes, as expressed in
its legislative history. Noting that the government "should be careful
[not] to undermine self-government within the labor movement," S. Rep.
No. 86-187 at 5, the Secretary argues that she may not decide the
appropriate allocation of power between local and intermediate bodies
of a labor organization. She contends further that the deference to
the union's allocation of power is consistent with Congress's
recognition of the fact that "in some unions intermediate bodies
exercise responsible governing power." Id. at 20.
Amici the UBC and NERC argue that the Secretary's decision
ultimately may be justified by the evolving nature of labor relations
in the construction industry. According to the union, the construction
industry has undergone increasing regionalization over the past few
decades, with construction work becoming concentrated in fewer and
larger employers, and employers undertaking a greater number of out-of-
state projects.6 The prior UBC organizational structure, which relied
5 The court is appreciative of the assistance ably provided by
all the amici curiae in this case.
6 For example, the UBC says in 1992 the Census Bureau reported
that 2.2 % of construction employers had 50 or more employees and were
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on relatively strong locals, was ill equipped to handle the realities
of employers operating on a regional scale. Thus, the union contends,
the Secretary's decision to allow strong Regional Councils reflects a
sensible response to prevailing market conditions. The UBC and NERC
urge that a contrary result would not only impinge on internal union
affairs,7 but would also handicap their ability to deal with employers.
See S. Rep. No. 86-187, at 7 (noting the committee's belief that the
Act should not "weaken unions in their role as collective-bargaining
agents"); see also Estreicher, Deregulating Union Democracy, 2000
Colum. Bus. L. Rev. 501, 503 (2000) (arguing that excessive regulation
of internal union affairs will impose unnecessary compliance costs and
performing 39.6 % of the dollar value of business. Bureau of the
Census, U.S. Dep't of Commerce, Pub. No. CC92-I-27, 1992 Census of
Construction Industries: Industry Series: United States Summary:
Establishment With and Without Payroll 12 (1995) (percentages from
calculations based on statistics in table 8). By 1997, this
concentration of work had increased to 2.6 % of employers having 50 or
more employees who were performing 42.1 % of the total dollar value of
construction business. U.S. Census Bureau, U.S. Dep't of Commerce,
Pub. No. EC97C23S-IS, 1997 Economic Census: Construction: Subject
Series: Industry Summary 12 (2000) (percentages from calculations based
on statistics in table 5).
7 The UBC also points to practical detriments for those
individuals who wish to run for election of requiring direct election
of council members. Because the electorate would expand from only his
or her own local to the entire 26,000 New England membership, both
mailings and face to face campaigning would be more onerous. It
estimates the cost of a single mailing at $9,000 and posits that
members would be discouraged from running.
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weaken the unions' ability to engage effectively in "economic struggle
with employers").
III.
The Secretary's decision under Title IV of the LMRDA
not to bring an action against a labor organization for
violation of 29 U.S.C. § 481 is subject to only narrow judicial
review. In Dunlop v. Bachowski, 421 U.S. 560 (1975), the
Supreme Court held that the Secretary's decision is subject to
review under the Administrative Procedure Act for whether her
decision is "arbitrary, capricious, an abuse of discretion, or
otherwise not in accordance with law." Id. at 565 (quoting 5
U.S.C. § 706(2)(A) and citing 5 U.S.C. §§ 702, 704). The
Supreme Court said that "[e]xcept in what must be the rare
case, the court's review should be confined to examination of
the 'reasons' statement, and the determination whether the
statement, without more, evinces that the Secretary's decision
is so irrational as to constitute the decision arbitrary and
capricious." Id. at 572-73.
Only the Secretary may bring such a suit for post-
election remedies. Local No. 82, Furniture & Piano Moving v.
Crowley, 467 U.S. 526, 544 (1984). There are two principal
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justifications for this exclusivity: "(1) to protect unions from
frivolous litigation and unnecessary judicial interference with
their elections, and (2) to centralize in a single proceeding
such litigation as might be warranted." Trbovich v. United Mine
Workers, 404 U.S. 528, 532 (1972). Although Congress mandated
that the Secretary bring suit upon a finding that probable cause
exists that a violation took place, the Supreme Court has
implied that the Secretary may decline to bring suit if the
Secretary is not convinced that the "violation . . . probably
infected the challenged election." Bachowski, 421 U.S. at 570
(quotation marks and emphasis omitted); see also Shelley v.
Brock, 793 F.2d 1368, 1373 (D.C. Cir. 1986).
The Statement of Reasons enables a court to determine
whether the Secretary's refusal to act is contrary to law.
Bachowski, 421 U.S. at 568-71. The courts' ability to review
the Secretary's decision, however, is not the only justification
for requiring the Secretary to provide an adequate statement of
reasons. The Supreme Court in Bachowski stated that Congress
intended that the Secretary provide the complaining union member
with a reasoned statement as to why she determined not to
proceed. And the Court noted that Congress intended to compel
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the Secretary in her Statement to "cover the relevant points and
eschew irrelevancies," thereby assuring "careful administrative
consideration." Id. at 572.
This case raises two significant questions not directly
addressed in Bachowski. The first is whether the Secretary has
departed from her prior interpretation of the Act, codified at
29 C.F.R. § 452.11 (2001). The second is whether the Secretary,
if she is employing the analysis contained in 29 C.F.R. §
452.11, is doing so in a manner consistent with Donovan v.
National Transient Division, International Brotherhood of
Boilermakers ("Boilermakers"), 736 F.2d 618 (10th Cir. 1984),
and Schultz v. Employees' Federation of the Humble Oil &
Refining Co. ("Humble Oil"), No. 69-C-54, 1970 U.S. Dist. LEXIS
12288 (S.D. Tex. Mar. 31, 1970).
As to the first question, the regulation provides that
The characterization of a particular organizational
unit as a "local," "intermediate," etc., is determined
by its functions and purposes rather than the formal
title by which it is known or how it classifies
itself.
29 C.F.R. § 452.11. Because the LMRDA does not define the terms
"local labor organization" or "intermediate bodies," the
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Secretary has room to supply definitions, as she did in the
regulation.
The Secretary's Statement of Reasons, however, does not
cite to the language of 29 C.F.R. § 452.11. Indeed, it has
language which appears to disavow a functional approach: "There
is no basis in the statute or in the legislative history for
concluding that if intermediate bodies possess certain functions
and powers, they may only elect their officers directly by
secret ballot vote among the members of the intermediate body."
This is seemingly inconsistent with the regulation, which
requires a "functions and purposes" analysis.
As to the second question, other parts of the Statement
then purport to look at the evidence to determine what
"functions" are performed by the two entities, perhaps applying
the test in the regulations. But the Statement does so without
any reference to the Secretary's own precedents, including the
precedents discussed in Boilermakers and Humble Oil.8
8 At oral argument, counsel for the Secretary was asked about
the Statement's failure to cite the applicable regulation or
precedents. Counsel responded that it is the Secretary's policy to
avoid legal terminology in the Statements and to attempt to explain the
reasons in terms that the average union member would understand.
Although this is a valid and admirable interest, it does not excuse the
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In Boilermakers, the Secretary sued to compel the National
Transient Division ("NTD"), a unit of the Boilermakers union, to
conduct elections in accordance with the provisions of the LMRDA
governing "local labor organizations." See 736 F.2d at 619. The Tenth
Circuit held that "[g]iven its structure and functions, we find no
reason to reject the Secretary's characterization of NTD as a local
labor organization." Id. at 623. The court noted first that, because
NTD was subordinate to the International and had no subordinate
organizational units, it had "the relatively simple organizational
structure characteristic of local labor organizations." Id. But the
court reasoned that the "[m]ost important" factor supporting the
Secretary's position was that "NTD performs the functions of a local."
Id. (emphasis added). In so holding, the court relied on the command
of 29 C.F.R. § 452.11 to examine the "functions and purposes" of the
entity in question. Id. at 622 (quoting 29 C.F.R. § 452.11). The
functions of the NTD included the negotiation of collective bargaining
failure to provide an adequate statement for purposes of judicial
review. If regulations and precedents are not explicitly cited, their
relevant language should at least be referenced in a way, albeit in
layperson's terms, that allows a reviewing court to know whether the
Secretary is relying on such precedents, repudiating them, or refining
them.
The Secretary's response is also odd because Harrington's
complaint document itself cited to the applicable regulations in the
Code of Federal Regulations, to Boilermakers, and to the legislative
history of the LMRDA. To suggest that complainants would be led astray
by some discussion of the law insufficiently credits the abilities of
union members. They were, after all, motivated to invoke the statute
and file a complaint.
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agreements, enforcing the agreements, handling grievances, collecting
dues from members, maintaining out-of-work lists, and holding meetings
at which members express their views. Id.9
Similarly to Boilermakers, the Secretary in Humble Oil sued
to force an entity purporting to be an intermediate body to conduct
elections as a "local" labor organization. 1970 U.S. Dist. LEXIS
12288. The district court, accepting the Secretary's construction of
the Act, found that the supposed intermediate body, the Employees'
Federation, was a statutory local because it performed "the basic local
union functions." Id. at *13 (emphasis added). That is, "[i]t
settle[d] grievances; collect[ed] dues and establishe[d] wages,
benefits, and working conditions by contract negotiations with the
employer; and discipline[d] its members and officers." Id. Even
though the Employees' Federation had numerous subordinate local bodies,
the court noted that these were mere "administrative arms" with "no
separate autonomy" that performed no significant collective bargaining
functions. Id. at *11-12.
9 When the union in that case sought certiorari, the Secretary
successfully opposed it. Amicus Association for Uniion Democracy
represents that in the Secretary's opposition to certiorari, the
Secretary argued that the division there was a local union because
"[i]t negotiates terms of employment with contractors, handles
grievances, maintains referral lists, and collects dues." Under this
definition, if it were to govern, NERC might well be a "local"; it
performs three of these four functions.
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Given the similarities between this case and Boilermakers and
Humble Oil, the Secretary must provide some explanation distinguishing
these cases. We cannot now say whether the Secretary has changed
her interpretation or departed from the regulation,10 but we can
say with fair assurance that substantial questions have been
raised and the Secretary's statement is inadequate to permit us
to resolve them. In that sense -- the inadequacy of her
statement -- the statement is arbitrary.
The Secretary denies there has been any change in
interpretation or policy, but it is far from evident that this
is so, and the Statement of Reasons does not adequately address
this topic. The Statement of Reasons does not mention the
governing regulation or precedents at all, contains language
inconsistent with the "functions and purposes" approach, 29
C.F.R. § 452.11, and, to the extent it purports to apply a
functions and purposes approach, fails to address or adequately
distinguish the two most pertinent precedents.
10 On the issue of apparent inconsistency, it is the Secretary's
policy which must be the focus; the opinions of our sister courts
affirming decisions by the Secretary to bring suit are most significant
in that they reveal what the Secretary then purported her policy to be,
and that the policy was not arbitrary. Those cases do not dictate to
the Secretary what policy position she should now take.
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The APA provides the applicable standard of review here
and it is commonplace in APA review to require an agency to
accompany a change in position with an explanation. See P.R.
Aqueduct & Sewer Auth. v. EPA, 35 F.3d 600, 607 (1st Cir. 1994).
Predictability as to how the Secretary will handle these cases
is of real value, and if predictability is to be thwarted in
favor of other interests, there should be some explanation. An
agency's decision cannot simply depart from the agency's prior
precedent without explaining its reasons for doing so.
Atchison, Topeka & Santa Fe Ry. Co. v. Wichita Bd. of Trade, 412
U.S. 800, 808 (1973) (plurality); Shaw's Supermarkets, Inc. v.
NLRB, 884 F.2d 34, 36-37 (1st Cir. 1989); JSG Trading Corp. v.
USDA, 176 F.3d 536, 544 (D.C. Cir. 1999). A deviation from prior
interpretations without sufficient explanation may be considered
arbitrary and capricious and therefore subject to judicial reversal.
See INS v. Yueh-Shaio Yang, 519 U.S. 26, 32 (1996); Citizens Awareness
Network, Inc. v. United States Nuclear Regulatory Comm'n, 59 F.3d 284,
291 (1st Cir. 1995); P.R. Sun Oil Co. v. EPA, 8 F.3d 73-77 (1st Cir.
1993). While this case does not involve judicial review of
either an agency adjudicatory proceeding nor of agency
rulemaking, the requirement of adequate explanation is an
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inevitable consequence of applying the APA's arbitrary and
capricious standard to the Secretary's reviewable decision
whether to initiate prosecution. That requirement distinguishes
this case from Heckler v. Chaney and its progeny. Chaney, 470
U.S. at 834 (comparing the presumption of nonreviewability of
other agencies' decisions not to undertake enforcement actions
with the reviewability of the Secretary's decision under the
LMRDA).
The agency's burden of explanation is heavier where an
agency has expressed its statutory interpretation in
regulations, adopted after notice-and-comment rulemaking, and
then seeks to depart from that interpretation. Agencies are
bound by their regulations, and to permit what may be a change
in the regulation without any explanation would undermine the
requirement of notice- and-comment rulemaking.11
Agencies do have leeway to change their interpretations of
laws, as well as of their own regulations, provided they explain the
11 Should the Secretary actually wish to change 29 C.F.R. §
452.11, she must do so in accord with the APA's general rulemaking
provisions. 5 U.S.C. § 553 (2000). See Util. Solid Waste Activities
Group v. EPA, 236 F.3d 749 (D.C. Cir. 2001) (holding that agency must
follow notice-and-comment procedures even to correct technical error in
regulation).
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reasons for such change and provided that those reasons meet the
applicable standard of review. See Bowles v. Seminole Rock & Sand Co.,
325 U.S. 410, 413-14 (1945) (counseling judicial deference to an
agency's interpretation of a rule it promulgates pursuant to statute).
Compare Citizens Awareness Network, 59 F.3d at 291-92 (remanding to
agency because agency altered interpretation of regulation without
providing reasoning or following statutory procedures), with Pub.
Interest Research Group v. FCC, 522 F.2d 1060, 1065 (1st Cir. 1975)
(upholding agency change in policy where agency provided a sufficiently
clear explanation). Judicial deference to agency interpretations and
policy choices is, in part, premised on the notion that agencies have
greater expertise in their area of specialty than do courts, and that
they should have flexibility to deal with changing economic and social
realities. See, e.g., Chevron, U.S.A. Inc. v. Natural Res. Def.
Council, Inc., 467 U.S. 837, 863-66 (1984). It is up to the agency in
the first instance to interpret the statute and apply those
interpretations to the facts.
Based on the Secretary's Statement of Reasons, we are
unable to determine if the Secretary has changed the policy
articulated in 29 C.F.R. § 452.11 or her interpretation of that
policy. We are confronted here with a different problem than
was faced in Bachowski, created by what appears to be an
inconsistency between the Secretary's approach and her
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regulation and prior decisions, which may represent a volte-face
by the Secretary. Her Statement of Reasons fails to explain
whether she is departing from her prior course and, if so, the
reasons for the change.
Decisions about the proper meaning of LMRDA statutory terms,
and the proper application of the Act's mandate, are for the Secretary
to make, so long as they do not contravene the Act. These decisions
are not up to the courts; thus, it is more appropriate for us to
refrain from taking any judicial view at this point on the underlying
interpretive issues in this case. Respect for her authority requires
a remand, rather than final court resolution of the issue now.
Moreover, a finding that the Secretary has acted arbitrarily and
capriciously as to the ultimate issue would be premature, as it is not
clear on this record that the Secretary is in fact repudiating her
prior interpretations here.
The paucity of explanation hinders judicial review, requiring
a remand to the Secretary to reopen, thereby providing the Secretary an
opportunity to better explain her position. Bachowski, 421 U.S. at 574;
Maine v. Civil Aeronautics Bd., 520 F.2d 1240, 1245 (1st Cir. 1975)
(remanding for further proceedings because "[t]here are internal
inconsistencies and a failure to clearly articulate the standard being
applied" in agency decision); see also Doyle v. Brock, 821 F.2d 778,
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781 (D.C. Cir. 1987); DeVito v. Schultz, 300 F. Supp. 381 (D.D.C.
1969). As the Supreme Court long ago said:
[The] basis [for an administrative action] must be set forth
with such clarity as to be understandable. It will not do
for a court to be compelled to guess at the theory
underlying the agency's action; nor can a court be expected
to chisel that which must be precise from what the agency
has left vague and indecisive. In other words, [w]e must
know what a decision means before the duty becomes ours to
say whether it is right or wrong.
SEC v. Chenery Corp., 332 U.S. 194, 196-97 (1947) (internal quotation
marks omitted); see Allentown Mack Sales & Serv., Inc. v. NLRB,
522 U.S. 359, 375 (1998) ("The evil of a decision that applies
a standard other than the one it enunciates spreads in both
directions, preventing both consistent application of the law by
subordinate agency personnel . . . and effective review of the
law by courts.") The Secretary is already committed by statute to
expending resources in this area and has presumably reviewed all the
pertinent factual materials presented. It is not a significant burden
on her resources to ask her to explain her decision in a more reasoned
fashion.12 Nor do we disrupt anything by vacating her decision;
12 As Judge Patricia Wald has said:
Th[e] need to communicate should be on regulators'
minds from the first moment they take up a problem, and
they should constantly remind themselves that one day
they will be defending their actions, no matter how
specialized or partaking of expertise, before a panel
of three generalists. It will not be enough that the
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vacation is a proper remedy when an agency fails to explain its
reasoning adequately. See Edward S. Quirk Co. v. NLRB, 241 F.3d 41
(1st Cir. 2001) (vacating and remanding for further proceedings in
absence of reasoned explanation from the Board); Gailius v. INS, 147
F.3d 34, 48 (1st Cir. 1998) (vacation and remand appropriate
where agency failed to give adequate explanation for
conclusions); see generally Prestes, Remanding Without Vacating Agency
Action, 32 Seton Hall L. Rev. 108 (forthcoming 2001), working paper
available at http://papers.ssrn.com (criticizing the practice of
remanding without vacating).
Should she again decide not to initiate suit, the Secretary
must file a sufficient Statement of Reasons, which addresses both the
application of the functions and purposes test of 29 C.F.R. § 452.11,
and whether her decision is consistent with her precedents. If there
has been a change, she should also explain whether changing labor
market economics justify a modification of prior interpretation or a
building construction trades exception to it, or what the other reasons
agency's lawyers then talk a good line; it will be
necessary that the agency itself has described in its
own decision what it is doing and why, in a way that
will be clear to the judicial reviewers.
Wald, Judicial Review in Midpassage: The Uneasy Partnership Between
Courts and Agencies Plays On, 32 Tulsa L.J. 221, 235 (1996).
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for the change are. See Yeuh-Shaio Yang, 519 U.S. at 31-32 (agency may
carve out exceptions to general policy).
We are mindful of the Supreme Court's admonition that
"endless litigation concerning the sufficiency of the written
statement is inconsistent with the statute's goal of expeditious
resolution of post-election disputes." Bachowski, 421 U.S. at
575; see also Eskridge, Note, Dunlop v. Bachowski and the Limits
of Judicial Review under Title IV of the LMRDA: A Proposal for
Administrative Reform, 86 Yale L.J. 885, 890-96 (1977) (arguing
that protracted judicial review impairs enforcement scheme).
Nonetheless, a remand is the appropriate remedy here. A serious
question has been raised about the Secretary's adherence to her
own articulated policies. Any delay and uncertainty occasioned
by remand is justified by the need for clarity, both in this
case and more generally, as to her present interpretation of her
statutory obligations. Pension Benefit Guar. Corp. v. LTV
Corp., 496 U.S. 633, 254 (1990).
The district court's dismissal of the petition for review is
reversed, the Statement of Reasons is vacated, and the matter is
remanded to the district court with instructions to remand to the
Secretary for proceedings consistent with this opinion.
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So ordered.
-- Concurrence Follows --
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TORRUELLA, Circuit Judge (Concurring). My colleagues in the
majority conclude that they are presently unable to determine whether
the Secretary's actions in this case were unlawful, and that only
further clarification from the Secretary will permit proper review.
Given this holding, as I understand it, the Secretary now has three
options following remand: 1) she may initiate suit; 2) she may decline
to initiate suit, acknowledge that she is adopting a new enforcement
policy and interpretation of the Act, and provide her reasons for
altering her prior policy; or 3) she may decline to initiate suit and
attempt to clarify for the court why she believes her decision is
consistent with the governing regulations and established past
practice.
I fully agree that the Secretary is entitled to pursue either
of the first two options. I write separately to express my view that
it would be futile for the Secretary to exercise the third option. We
need no additional information to correctly conclude that the
Secretary's decision in this case does not square with her established
policies and practices. Since the Secretary has provided no reasoned
basis for the inconsistency, we should set aside her decision as
"arbitrary and capricious" in violation of 5 U.S.C. § 706(2)(A). See
Honeywell Int'l, Inc. v. NLRB, 259 F.3d 119, 123 (D.C. Cir. 2001)
("Without more, the [agency's] departure from precedent without a
reasoned analysis renders its decision arbitrary and capricious.").
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In 1973, the Secretary enacted a regulation directly
governing determinations of whether a labor organization is a "local"
or "intermediate" body for purposes of § 401 of the LMRDA. See 38 Fed.
Reg. 18,324, 18,326 (July 7, 1973). That regulation, which remains in
effect, provides that "[t]he characterization of a particular
organizational unit as a 'local,' 'intermediate,' etc., is determined
by its functions and purposes rather than the formal title by which it
is known or how it classifies itself." 29 C.F.R. § 452.11 (emphases
supplied). The Secretary's past commitment to the regulation's
"functional" -- as opposed to merely "structural" -- approach is borne
out in the only reported decisions addressing the question of whether
a union entity is a "local" or "intermediate" body for purposes of
Title IV's election provisions. See Donovan v. Nat'l Transient Div.,
Int'l Bhd. of Boilermakers, 736 F.2d 618 (10th Cir. 1984); Shultz v.
Employees' Fed'n of Humble Oil & Ref. Co., No. 69-C-54, 1970 U.S. Dist.
LEXIS 12288 (S.D. Tex. Mar. 31, 1970).
By contrast, the Secretary's Statement of Reasons in the
present case declares that "[t]here is no basis in the statute or in
the legislative history for concluding that if intermediate bodies
possess certain functions and powers, they may only elect their
officers directly by secret ballot vote among the members of the
intermediate body" (emphases added). Taking this statement as a
guiding principle, the Secretary then proceeds to analyze only the
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structure of the labor organization in question, concluding that the
UBC locals "satisfy the definition of 'local' in the ordinary sense" in
that they are "are clearly subordinate to NERC, which in turn is
subordinate to the International."
I fail to see how further clarification will reconcile the
Secretary's present position (that there is "no basis" for conducting
an inquiry of the entity's "functions and powers") with the governing
regulation (which mandates an inquiry of the "functions and purposes"
of the challenged entity).1 The Secretary has had every opportunity in
this litigation to characterize her decision as consistent with past
practice, and I presume that she did not hold back her best arguments.
Nevertheless, the Secretary's extended analysis of the case law is
1 One might argue that the Secretary's present statement can be
reconciled with the regulation because it purports only to find no
basis for a functional inquiry in the statute and legislative history,
while not, specifically, saying that no such basis exists in the
regulations. An argument of this sort would, however, be disingenuous.
Any valid administrative regulation must have some basis in the
language of a statute. That is, a valid regulation must, at the very
least, provide a reasonable interpretation of an otherwise ambiguous
statutory provision. Becker v. Fed. Election Comm'n, 230 F.3d 381, 390
(1st Cir. 2000), cert. denied, --- U.S. ---, 121 S. Ct. 1733 (2001).
If it is accurate that there is truly no basis in the Act for
conducting a functional inquiry, as the Secretary contends, we likely
would be compelled to hold the regulation mandating such an inquiry
invalid. See id. ("Agency regulations in accord with [Congress']
unambiguously expressed intent are upheld; those that contravene that
intent are invalid."). Thus, the inconsistency remains. Any statement
by an agency that is tantamount to a declaration that its own governing
regulation is invalid would, surely, require acknowledgment and
explanation.
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unpersuasive, and she makes no attempt to harmonize her decision with
29 C.F.R. § 452.11. If we are not yet convinced that the Secretary has
pursued a consistent approach, what more will she reveal in a
supplemental statement that is likely to sway us?
To be sure, one can conceive of a Statement of Reasons that
is so elliptical or opaque that a reviewing court simply cannot discern
the Secretary's position or rationale. And in such cases, I fully
agree that further explanation from the Secretary is warranted. See,
e.g., Donovan v. Local 6, Wash. Teachers' Union, 747 F.2d 711, 719
(D.C. Cir. 1984) (mandating a supplemental statement of reasons where
the Secretary's reasons for finding no violation of the Act were
"perfunctory and cryptic"). However, this is not such a case. The
Secretary has stated her present interpretation of the Act with
reasonable clarity, and her present interpretation obviously does not
gibe with the readily discernible past policy and practice. 2
2 I also believe that, in a laudable effort to accord deference
to an administrative agency, the majority opinion unintentionally
threatens to impose a heightened and wholly unnecessary administrative
burden on the Department. As the Statement of Reasons in the Appendix
should indicate, these are relatively informal documents. While they
are intended to aid courts in reviewing agency action, they are also
intended to be read and understood by the complaining union members.
Dunlop v. Bachowski, 421 U.S. 560, 572 (1975). For this reason, we are
entitled only to a simple statement that "inform[s] the court and the
complaining union member of both the grounds of decision and the
essential facts upon which the Secretary's inferences are based." Id.
at 573-74. If we require the Secretary to provide a Statement of
Reasons that goes beyond even the appellate-caliber briefing that we
already have, the likely result will be that the Secretary's responses
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Accordingly, we should conclude that her decision must be set aside as
arbitrary and capricious. If, following remand, the Secretary decides
not to initiate suit, she should be required to provide a Statement of
Reasons that acknowledges her departure from precedent. She should
also have to explain her rationale for the decision and explain whether
the decision is consistent with both the LMRDA and any governing
regulations currently in effect.
Since my view does not command a majority of this panel, I
must await, with morbid curiosity, a persuasive clarification of the
reasons for the Secretary's decision that could not be articulated in
the original Statement of Reasons, the Secretary's thirty-one page
brief, or the fifteen page submission of the amicus union.
become less accessible to the lay complainant. Worse yet, the
administrative resources necessary to generate such an extensive legal
analysis for each decision not to sue will likely distract the
Department from processing the complaints of union members in a timely
fashion.
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APPENDIX
STATEMENT OF REASONS OF THE SECRETARY OF LABOR
The complainant, Thomas Harrington, a member in good standing
of New England Regional Council of Carpenters [Regional Council],
United Brotherhood of Carpenters and Joiners, AFL-CIO, filed a timely
complaint alleging that the Regional Council fails to elect its
officers in compliance with Title IV of the Labor Management Reporting
and Disclosure Act of 1959, 29 U.S.C. §§ 482, et seq. (the "Act"). For
the following reasons, the complaint is dismissed.
The complainant alleges that since the Regional Council
assumed functions traditionally performed by the locals of the
Carpenters, The Regional Council is now acting as a "local" labor
organization and must therefore directly elect its officers to remain
in compliance with section 401(b) of the Act, 29 U.S.C. § 481(b).
Section 401(b) of the Act states, "Every local labor organization shall
elect its officers not less often than once every three years by secret
ballot among the members in good standing." The Regional Council
considers itself an intermediate body, and elects its officers via
delegates elected by the members of locals pursuant to section 401(d)
of the Act, 29 U.S.C. § 481(d). Section 401(d) states that, "Officers
of intermediate bodies, such as general committees, system boards,
joint boards, or joint councils, shall be elected not less often than
once every four years by secret ballot among the members in good
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standing or by labor organization officers representative of such
members who have been elected by secret ballot."
The Regional Council was created by the United Brotherhood
of Carpenters and Joiners International on July 1, 1996. The bylaws
of the Regional Council do appear to invest it with some of the powers
and functions the locals traditionally possessed. However, the
Department is unable to conclude that for this reason the Regional
Council is no longer an intermediate body entitled to elect its
officers in accordance with either of the two choices prescribed by
Congress for intermediate bodies in section 401(d) of the Act.
Congress' purpose in ordering unions to conduct free and fair
periodic elections was "to insure that the officials who wield [power]
are responsive to the desires of the men and women whom they
represent". S. Rep. No. 187, 86th Cong., 1st Sess. 19-20. In section
401(d) of the Act, Congress indicated that with respect to intermediate
bodies the above purpose could be achieved either directly by a secret
ballot vote among all of the members of the intermediate body or
indirectly by delegates who themselves were elected directly by secret
ballot vote among all the members they represent. Furthermore, that
same report indicates that Congress recognized that intermediate bodies
had varying degrees of governing power. It states, "The bill
recognizes that in some unions intermediate bodies exercise responsible
governing power and specifies that the members of such bodies as
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systems boards in the railroad industry be elected by secret ballot of
the members of the union or union officers elected by the members by a
secret ballot." Id. (emphasis added). Thus, Congress understood that
intermediate bodies could exercise "governing power" and still be
permitted to elect officers via delegate as long as these delegates
were selected by secret ballot. There is no basis in the statute or
in the legislative history for concluding that if intermediate bodies
possess certain functions and powers, they may only elect their
officers directly by secret ballot vote among the members of the
intermediate body.
Further, the Department's investigation disclosed no evidence
that would provide a basis for concluding that the Regional Council is
now a "local" labor organization. The available evidence indicates
that the locals that comprise the Regional Council have not been
dissolved or absorbed by the Regional Council so as to be mere
administrative arms of the Council, but rather appear to continue to
function as separate labor organizations under the Act. From the
evidence obtained from the Department's investigation, the locals
subordinate to the Regional Council satisfy the definition of "local"
in the ordinary sense. All of the locals of the Carpenter's New
England region are clearly subordinate to the Regional Council, which
in turn is subordinate to the International. These locals are
independently chartered, have identifiable memberships, elect their own
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officers, and have their own bylaws. The locals are parties to
collective bargaining agreements, and although the Regional Council
negotiates these agreements, the locals have the authority to ratify
them. The New England Carpenter locals hold meetings periodically
where the membership is informed of union activities and business.
Each local has its own budget and manages its own bank accounts.
Collection of membership dues is performed at the local level. First
level grievances are administered by stewards at the local level.
Based upon these facts, we are unable to conclude that the locals of
the New England Regional Council are so depleted of power and function
that they no longer constitute "local" labor organizations under the
LMRDA. There is no violation.
It is concluded from the analysis set forth above that the
investigation failed to disclose any violation of the Act upon which
the Secretary of Labor may bring an action under Section 402 of the
Act, 29 U.S.C. § 482, to set aside the election. Accordingly, we are
closing our file on this matter.
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