Sheet Metal Workers' International Association, Local 206, of the Sheet Metal Workers' International Association, Afl-Cio, and the Board of Trustees of the Sheet Metal Workers' Pension Plan of Southern California, Arizona and Nevada the Board of Trustees of the Sheet Metal Workers' Health Plan of Southern California, Arizona and Nevada and the Board of Trustees of the Sheet Metal Workers' National Pension Fund, Intervenors v. R.K. Burner Sheet Metal Inc.

Citations: 859 F.2d 758; 129 L.R.R.M. (BNA) 2866; 1988 U.S. App. LEXIS 15917Docket: 87-6212

Court: Court of Appeals for the Ninth Circuit; October 17, 1988; Federal Appellate Court

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R.K. Burner Sheet Metal Inc. appeals a district court's partial confirmation of an arbitration award related to its 1983 collective bargaining agreement with Sheet Metal Workers' Local 206. The Ninth Circuit affirms the decision. The background involves a three-year agreement that required negotiation for successor contracts, which did not occur in 1986, leading Local 206 to declare an impasse and submit the matter to arbitration. Burner contested the arbitration process, claiming Local 206 refused to extend the agreement and filed an unfair labor practice complaint, which was unsuccessful. 

The National Joint Adjustment Board (NJAB) intervened, ordering the signing of a modified Standard Form of Union Agreement and retaining jurisdiction for any potential judicial issues regarding non-mandatory terms. Local 206 sought court confirmation of the NJAB's decision, while Burner aimed to vacate it. The district court confirmed the NJAB's decision for mandatory bargaining terms from July 1, 1986, until December 15, 1986, when Local 206 was decertified as the bargaining representative for Burner's group. Burner subsequently appealed this confirmation.

Burner challenges the district court's jurisdiction to confirm the NJAB decision, asserting that the court lacked authority under section 301 of the Labor Management Relations Act to confirm the arbitration award. The district court's jurisdiction to enforce or vacate arbitration awards is established, with confirmations typically reserved for final and binding decisions. Previous case law, such as Millmen Local 550 v. Wells Exterior Trim, indicates that an arbitration award that defers the determination of a remedy cannot be considered final. However, the NJAB's decision in this case was deemed final and binding as it directed the parties to enter a new three-year agreement, inclusive of wage increases and an interest arbitration clause. The NJAB retained jurisdiction solely for non-mandatory bargaining issues contingent on court findings or failure to reach an agreement, thus allowing the district court to properly confirm the NJAB decision regarding mandatory terms.

Burner further argues that its obligation to arbitrate under the 1983 Agreement's interest arbitration provisions is negated by its association with the Standard Form of Union Agreement negotiated by SMACNA. While generally, an individual employer may not be compelled to arbitrate under agreements negotiated by multi-employer associations, this case differs significantly. Burner signed the 1983 Agreement as the only contractor and was not part of a multi-employer association at the time of negotiation. Moreover, there is no evidence that Burner was coerced into accepting the Standard Form of Union Agreement. Although the NJAB's arbitrator selection process may disadvantage non-SMACNA employers, Burner, as a former SMACNA member, was aware of these processes when agreeing to the arbitration provisions. The district court correctly concluded that Burner was required to submit to arbitration under the 1983 Agreement.

Burner argues that the district court improperly confirmed the NJAB decision by only addressing mandatory bargaining terms, asserting that the severed non-mandatory terms were essential enough to invalidate the entire contract. The court disagrees, stating that valid provisions of a collective bargaining agreement may remain enforceable even if some provisions are severed, as established in NLRB v. Rockaway News Supply Co. Severance is inappropriate only in extraordinary circumstances, such as illegal agreements or when a severed provision is fundamental to the whole contract. In this case, the terms related to employees working "in shop" remained unchanged from the 1983 agreement, and the non-mandatory provisions concerning industry promotion, funds, grievance resolution, and time periods were not so critical that they warranted voiding the entire contract. The new contract still adequately addresses back pay and fringe benefits for the specified period.

Additionally, Burner claims the right to unilaterally repudiate the 1983 Agreement based on a recent NLRA ruling regarding section 8(f) pre-hire agreements. However, the court notes that interest arbitration clauses survive the expiration of such agreements, as established in relevant case law. The NLRB's decision not to find Burner's statutory duty to bargain under the 1983 Agreement does not absolve Burner of its contractual obligations, a point reaffirmed by the court’s previous rulings. The NLRB also reserved potential contract claims when dismissing the unfair labor practices charge against Burner. Therefore, regardless of whether the court adopts the Deklewa standard, it concurs with the district court's ruling that Burner could not unilaterally repudiate the 1983 Agreement. The request for sanctions was denied, and the ruling was affirmed.