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National Labor Relations Board v. Local 46, Metallic Lathers Union & Reinforcing Iron Workers of New York & Vicinity of the International Ass'n of Structural & Ornamental Iron Workers
Citation: 149 F.3d 93Docket: Docket No. 97-4021
Court: Court of Appeals for the Second Circuit; June 26, 1998; Federal Appellate Court
Judge Brieant concurs separately, while Judge Calabresi dissents. Circuit Judge Meskill addresses a petition concerning the National Labor Relations Board’s (NLRB) finding that Local 46, Metallic Lathers Union, violated the National Labor Relations Act by refusing to refer work to Fred James, an African-American ironworker, in retaliation for his prior racial discrimination charge against the Union. The court finds substantial evidence supporting the Board's conclusion of unlawful motivation behind Local 46's refusal. However, it also determines that the Board improperly denied Local 46 an affirmative defense based on precedent set in NLRB v. Transportation Management Corp., leading to the conclusion that Local 46 did not violate the Act and that James did not suffer a legally recognizable injury. Consequently, the court denies enforcement of the Board’s order. The case stems from the NLRB's petition to address alleged unfair labor practices related to Local 46's work referral system, which is governed by a collective bargaining agreement with the Cement League. This system was established to ensure equitable job referrals regardless of race or union membership, with specific rules requiring workers to sign in at the Union hiring hall by 8:30 a.m. for job referrals. The Union business agent announces available jobs and makes referrals based on a priority system that favors workers with longer unemployment durations, maintaining a daily list of workers who registered but were not referred. Employer requests for workers are submitted on "contractor sheets," which are date- and time-stamped upon receipt. Business agents must offer jobs based on the order of requests received. Employers cannot request specific individuals unless they are foremen or deputy foremen. When a worker accepts a job, they must sign a contractor’s sheet to confirm their acceptance, which is then used at the job site. Exceptions to priority referral exist for jobs requiring specific skills and for requests for minority workers, which the Union must fulfill per federal, state, and local laws. For minority worker requests, the Union marks an "M" next to the worker's name on the contractor’s sheet. Only the court-appointed Administrator can modify hiring hall rules, and such modifications require consultation with the Union and Government, followed by written communication and a 15-day period for either party to contest the changes in court. Despite this, the Administrator has informally modified rules in the past, including extending the out-of-work period for priority referrals from two to three weeks. Fred James filed an unfair labor practice charge against the Union, alleging racial discrimination in worker referrals. He claimed that since mid-November 1993, the Union had refused to refer him to jobs, violating the Act. Following a second charge, the Board's General Counsel issued a complaint against the Union for not referring James to a specific job, alleging retaliation for his earlier charge. The Union denied wrongdoing, asserting that James did not meet the necessary priority criteria for the job referral on the date in question. Fifty-eight individuals ranked ahead of James on the hiring list, having registered between nine and fifteen days prior. Three men, all minorities and outranking James, were sent to the Northberry job: George Caban (ranked first), Dennis Campbell (second), and Daryl Moore (eighth). During a May 3, 1995 hearing before ALJ Robert T. Snyder regarding James' retaliation complaint, James testified he had asked Ledwith for a job referral on May 4, 1994, after being unemployed for some time. Ledwith mentioned a job opportunity at Northberry Concrete Corporation, promising to refer James. However, when James inquired a week later, he learned Ledwith had referred three others instead. Ledwith, holding a letter from the Board about James' racial discrimination claim, indicated he changed his mind about sending James after receiving the letter. The Union disputed James' claims but argued that even if Ledwith acted out of retaliation, they did not violate the Act due to their hiring hall rules, which prevented referring James given his low priority ranking. The General Counsel contended that the Union could not use these rules as a defense because they had not consistently enforced them. Evidence was introduced to show Ledwith had previously violated such rules, including an incident involving another member, Johnny Rodriguez, whom Ledwith bypassed for referral. The Union objected to the relevance of this testimony, but the ALJ overruled the objection and denied the Union’s request to continue the hearing to gather more evidence. The ALJ determined that Ledwith’s actions represented a significant breach of hiring hall rules. Specifically, in January 1995, Ledwith improperly referred James to a job despite James's late arrival, lack of signing in, and absence when the job was called. The ALJ noted Ledwith’s extensive discretion in administering these rules. Additionally, the General Counsel argued, and the ALJ concurred, that Ledwith had the arbitrary authority to allocate longer-duration jobs among workers due to a lack of guidance in the hiring hall rules regarding simultaneous requests from multiple employers. Ledwith claimed he did not exercise such discretion, stating he followed a priority list for job referrals. However, he acknowledged referring non-white workers by name, regardless of their priority list status. This practice included referring James Hatcher and Howard Golding to a job despite Hatcher not being on the priority list and other non-white workers being registered. The ALJ ruled this practice as improper, as the rules only allow name requests for foremen or deputy foremen, and noted that such referrals disadvantaged minority workers on the priority list. The absence of detailed request records further indicated Ledwith's arbitrary selection among non-white workers. Zaid Abdullah, another ironworker, testified about Ledwith's disregard for hiring hall rules when he observed Ledwith referring three recently terminated workers from a previous job to a new position on the same day they returned to the hiring hall. Abdullah questioned Ledwith on this practice, pointing out that those workers likely were not on the priority list. Ledwith defended his decision by citing the unique skills of those workers required for the job. However, Abdullah admitted during cross-examination that he could not perform a necessary skill for that job. Ledwith breached hiring hall rules by making subjective referrals, prioritizing three workers over those with special bending machine skills, which the ALJ determined violated established protocols. The ALJ confirmed that Ledwith promised James a referral to Northberry, demonstrating his discretion in referral decisions, a point the Union does not contest. Ledwith's practice of selecting workers alphabetically contradicted Rule IV(C)(3), which mandates earlier sign-ins take precedence for referrals. The ALJ found this method arbitrary and detrimental to job duration for workers. Evidence showed that Ledwith referred Daryl Moore despite Moore's failure to sign in, violating sign-in requirements. Additionally, Abdullah received a job directly from a contractor, which the Union ratified, highlighting deviations from referral rules. The ALJ concluded that Ledwith’s handling of the hiring hall lacked clarity, granting him the authority to refer James despite rule violations. Ledwith's failure to follow through on his referral to James, related to James' prior discrimination complaint, constituted violations of sections 8(b)(1)(A) and (b)(2) of the Act. The ALJ recommended that the Union cease discriminatory referral practices, compensate James for lost earnings, and post notices of the findings. The Union subsequently challenged the Board's decision, claiming a lack of substantial evidence for the findings regarding Ledwith's discretion in referrals. The Union contends that Ledwith was obligated by hiring hall rules to deny James a job referral to Northberry, irrespective of any retaliatory motives. Citing the Wright Line case, the Union argues that since Ledwith's actions were consistent with the hiring hall rules, there can be no violation of the Act. The evidence does not support claims of inconsistent enforcement or discretionary application of the rules by Ledwith, allowing the Union to use these rules as a defense. As James would not have been referred regardless of Ledwith's motivation, he suffered no legal harm, leading to the denial of the Board’s order. In hiring hall cases, a Wright Line analysis is necessary for allegations of discrimination in hiring or referrals. The General Counsel must demonstrate that the worker's protected conduct significantly influenced the Union's referral decision. If the Union fails to rebut this, it can still avoid liability by proving that the refusal was based on the worker's unprotected conduct and that the referral would not have occurred anyway. The First Circuit clarifies that if the referral refusal would have happened regardless of the protected activity, no unfair practice exists, as ill intent without effect does not constitute a violation. For the Union's defense to be valid, it must show adherence to an established standard, such as a collective bargaining provision or a consistent practice. A union can refuse a referral if it would breach non-discretionary hiring hall rules but cannot use the guise of rule enforcement to justify unlawful discrimination if it has not consistently enforced those rules. If a union introduces discretion into a non-discretionary process, it can be held accountable for discriminatory actions. In this instance, the Union acknowledges that Ledwith initially promised James a referral but later withdrew it as retaliation for James’ prior charge. The Union contends that the Board incorrectly upheld the ALJ's finding that Ledwith and the Union inconsistently enforced hiring hall rules, which led to the denial of the Union's affirmative defense under Wright Line. The Union argues that the ALJ's reliance on the Rodriguez and Abdullah incidents lacks substantial evidence of inconsistent enforcement of the referral rules. Specifically, the Union claims the Rodriguez incident is merely hearsay from a later date, while the Abdullah incident does not demonstrate a rules violation. However, it is noted that these incidents were among several cited by the ALJ. Upon review, it is acknowledged that the overall record lacks substantial evidence indicating that Ledwith inconsistently enforced the hiring hall rules or improperly injected discretion into their enforcement. Additionally, an error in the ALJ's reasoning is identified, where it was incorrectly concluded that Ledwith could disregard the hiring hall rules due to past violations. The document emphasizes that a union cannot claim an affirmative defense against discrimination if it has selectively enforced its rules, and the authority to disregard a court order cannot be attained through prior violations. The Board's findings can be overturned if not supported by substantial evidence, defined as more than a mere scintilla and adequate for a reasonable mind to accept as a conclusion. The review process stipulates that reversal is warranted only if no rational trier of fact could reach the Board's conclusion. Furthermore, the ALJ's conclusions were partially based on evidence of rule deviations occurring after the Northberry incident, which the document argues is not relevant to the Union's adherence to its referral rules at the time of the incident in question. Thus, such post-complaint evidence lacks the probative force required to negate the Union's affirmative defense. No authority exists to contradict the principle that a union forfeits its right to invoke hiring hall rules as a defense when it fails to adhere to those rules in referral decisions. This forfeiture occurs when the union exercises discretion contrary to non-discretionary referral rules. Until that discretion is exercised, the union can use these rules as a defense against unfair labor practice charges, and deviations occurring after the relevant incident do not affect this defense's validity. Evidence of such "after the fact" deviations is deemed irrelevant and insufficient for establishing a substantial defense. Regarding job referrals, the Administrative Law Judge (ALJ) erroneously concluded that Ledwith had discretion in assigning longer duration jobs, despite the hiring hall rules requiring referrals to be made based on a date-and-time stamp of requests. Thus, Ledwith did not exercise impermissible discretion, and the ALJ’s finding is unsupported by evidence. Furthermore, even if discretion existed, there must be evidence of its arbitrary application to undermine the union's defense, which is lacking. In terms of minority referrals, Ledwith's practice of referring minority workers by name, regardless of their priority list status, was found by the ALJ to be an improper exercise of discretion. However, the relevant rule explicitly states that the union must fulfill employer requests for non-white workers, implying no restriction on referring them outside the priority list. Thus, the ALJ's conclusion about Ledwith’s referral practices is incorrect, as the hiring hall rules affirm the union's obligation to prioritize non-white workers’ requests. The phrase in question allows employers to request minority worker referrals by name, exempting them from standard hiring hall rules. Consequently, Ledwith’s practice of referring minorities does not violate these rules and does not improperly inject discretion into the enforcement process. The ALJ's contrary finding was deemed unsupported. Abdullah claimed that Ledwith prioritized three workers for a specialty job despite Abdullah having relevant experience, yet he had previously informed Ledwith he lacked bending machine operation skills. The ALJ speculated that Abdullah's skills were satisfactory and that others likely had the requisite skills, but this speculation is rejected as it lacks substantial evidence. Following objective standards in evaluating qualifications is essential to avoid breaching the union’s duty of fair representation. Ledwith's promise to refer James to a job at Northberry was acknowledged by the ALJ and is undisputed. This promise indicates Ledwith had the discretion to make referrals strategically. However, since the promise was not fulfilled, it did not compromise the referral process to the extent of introducing impermissible discretion into the non-discretionary rules. While Ledwith exceeded his authority by making the promise, he did not violate enforcement provisions, as he ultimately did not act on the discretion he claimed to possess. The union loses protection under referral rules if it introduces and enforces discretion contrary to established protocols, as demonstrated in two cases involving worker referrals. In one instance, a union allowed a worker to stay on a job without the necessary workslip and later removed him after discovering his dissident activities. In another case, a low-priority worker was offered a high-priority job but declined it, leading to the refusal of the same job to another low-priority worker. The Administrative Law Judge (ALJ) incorrectly found that Ledwith’s promise to refer James to Northberry was an impermissible exercise of discretion. While Ledwith violated hiring hall rules by referring workers alphabetically instead of by sign-in order, this practice was deemed objective and not arbitrary. Additionally, Ledwith's referral of Daryl Moore, who had not signed in but was present and ahead of another worker in line, was seen as an oversight rather than a disregard for rules, thus not causing unfair prejudice. The findings indicate that deviations from hiring hall rules were not indicative of the Union's arbitrary enforcement and do not preclude the Union from asserting its defense. Ultimately, substantial evidence supports the conclusion that Local 46 acted unlawfully in refusing to refer James to the Northberry job. Local 46 successfully established, through a preponderance of evidence related to its referral rules, that it would have denied James a referral regardless of any unlawful motive. Consequently, the Board's denial of Local 46's affirmative defense under Transportation Mgmt. Corp. is not supported by substantial evidence. As a result, it is concluded that Local 46 did not violate the Act, and James did not experience any legal injury. The enforcement of the Board's order is denied. The document also addresses the definition of "Government" within Rule VIII, which is ambiguous regarding whether it refers to the NLRB or the Secretary of Labor. The Act outlines that it is an unfair labor practice for a labor organization to restrain or coerce employees in exercising their rights or to discriminate against employees regarding union membership. Past Board findings indicate that a union's discriminatory refusal to refer an employee can lead to a violation of section 8(b)(1)(A) and (2) of the Act. In the context of Wright Line, the General Counsel must prove that anti-union animus was a motivating factor in employment decisions, shifting to the employer the burden to show that the action would have occurred regardless of discrimination. The Supreme Court upheld the Board's approach in Wright Line, disagreeing with the First Circuit's burden allocation. Judge Calabresi, in dissent, argues that deviations from hiring hall rules occurring after the contested action are pertinent to whether the Union violated its referral rules at the time of that action. He cites precedents indicating that evidence of an object's condition at different times can be relevant, but only when the practices at the earlier time are in question. Specifically, he references cases demonstrating that post-event evidence can be used to establish that a specific instance of misconduct is linked to a broader policy or custom. However, he concludes that there is no credible evidence showing the Union inconsistently enforced referral rules at the time in question, rendering subsequent violations irrelevant. Furthermore, he challenges the Administrative Law Judge’s (ALJ) assertion regarding Ledwith's discretion in making referrals, emphasizing that Ledwith did not agree with the General Counsel's claim and explicitly stated he lacked such discretion. He also disputes the ALJ’s finding of inadequate request records related to the referral of minority workers Hatcher and Golding, noting that contractor sheets presented during the hearing identified these individuals specifically. The absence of further records from the Union does not substantiate the claim that Ledwith could arbitrarily choose among non-white workers for referrals.