National Labor Relations Board, Petitioner, v. Beverly Health and Rehabilitation Services, Inc., Beverly Enterprises-missouri, Inc., Doing Business As New Madrid Nursing Center, Respondent, 187 F.3d 769 (8th Cir. 1999)

The National Labor Relations Board (the Board) petitions pursuant to 29 U.S.C. 160(e) for enforcement of its order entered pursuant to its authority under 29 U.S.C. 160(c). See Manufacturing, Prod. & Serv. Workers Union, Local 24, 325 N. L. R. B. No. 166, 1998 WL 318971 (June 12, 1998) (order adopting and incorporating the decision of the administrative law Judge) (hereinafter "NLRB order"). Beverly Health and Rehabilitation Services, Inc. (Beverly) opposes the Board's petition, arguing that the order is not supported by substantial evidence in the record as a whole and that the Board exceeded its authority in imposing certain remedies. For reasons stated below, the Board's order is enforced.

Background

Beverly operates several nursing homes, including one in New Madrid, Missouri. On July 10, 1995, the Manufacturing, Production and Service Workers Union, Local 24, AFL-CIO (the union), was certified as the exclusive collective bargaining representative for Beverly's non-professional employees at the New Madrid facility. Thereafter, representatives of the union and Beverly met on several occasions from September 1995 to June 1996 in an effort to negotiate a collective bargaining agreement. On or about June 25, 1996, when it appeared that an agreement was imminent, Beverly received a petition signed by 22 employees in the bargaining unit stating their desire to terminate the union's representation. By letter dated July 1, 1996, Beverly notified the union that it was withdrawing all prior representations and proposals it had made in the negotiations, but would consider new proposals from the union. Upon receiving that letter on July 8, 1996, the union representative, on July 8 and again on July 10, 1996, telephoned and left messages for the Beverly representative - each time receiving no response. On July 11, 1996, Beverly received a second decertification petition, this time containing 25 employees' signatures. At that time, there were 45 employees in the collective bargaining unit. On July 17, 1996, Beverly notified employees at the New Madrid facility that they no longer were represented by the union, and the company removed union materials from a bulletin board to which the union had previously been granted access under an interim agreement.

The union filed a complaint with the Board, alleging that Beverly had violated Sections 8(a) (1) and 8(a) (5) of the National Labor Relations Act (NLRA), 29 U.S.C. 158(a) (1), (5). The matter was tried before an administrative law Judge (ALJ), who recommended a decision in favor of the union. Under the "certification year" rule, the ALJ explained, the union was entitled to a presumption of majority status and good faith bargaining from Beverly for one year following the union's certification as the collective bargaining representative. Beverly "was not privileged to entertain a good-faith doubt regarding the Union's majority status until the Conclusion of the certification year." NLRB order at 6, 1998 WL 318971, at *8 (citing cases). However, Beverly withdrew its bargaining proposals without valid justification before the certification year ended on July 10, 1996. The ALJ opined that Beverly had "'seized on the... legally meaningless employee petition as a mechanism for escape from its statutory duty to bargain.'" Id. (quoting Den-Tal-EZ, Inc., 303 N. L. R. B. 968, 970 (1991), enforced sub nom. NLRB v. Star Dental Prods., A Div. of Den-Tal-EZ, Inc., 986 F.2d 1409 (3d Cir. 1993)). The ALJ also determined that Beverly had engaged in unfair labor practices when it unilaterally changed working conditions and announced to employees that they were no longer represented by the union. The ALJ concluded that Beverly had violated Sections 8(a) (1) and 8(a) (5) of the NLRA. See id. at 6-7, 1998 WL 318971, at *8-9.

The Board agreed with the ALJ's Conclusions and adopted the ALJ's recommendations. The Board ordered Beverly to cease and desist from its unfair labor practices and to negotiate with the union in good faith for an additional six months, including reinstating all of its earlier proposals. See id. at 7, 1998 WL 318971, at *9-10.

The Board petitioned this court for enforcement of its order, and Beverly opposed the petition.

Discussion

Upon certification as an exclusive bargaining representative, a union is entitled to an irrebuttable presumption that it retains majority support for a reasonable period, usually one year, and during that time the employer has a duty to negotiate in good faith with the union. See Brooks v. NLRB, 348 U.S. 96, 98-99 (1954). Imposition of this so-called "certification year" rule is within the Board's administrative authority and is reviewed only for an abuse of discretion. Id. at 104. Questions concerning whether an employer has negotiated in good faith are primarily for the Board to resolve and are to be upheld on review if supported by substantial evidence on the record as a whole. See Radisson Plaza Minneapolis v. NLRB, 987 F.2d 1376, 1381 (8th Cir. 1993).

On review, we hold that the Board's assessment of Beverly's good faith - or lack thereof - is supported by substantial evidence on the record as a whole. The record supports the Board's Conclusions that Beverly withdrew its proposals in an effort to prolong the process until after the certification year had expired and that the reasons given by Beverly to justify its actions are pretextual. Moreover, Beverly's complete withdrawal of its earlier bargaining proposals at the critical final stages of the negotiations is, as the ALJ believed, strong evidence of bad faith. Accord NLRB v. Ramona's Mexican Food Prods., Inc., 531 F.2d 390, 394 (9th Cir. 1975) (company's repudiation of a prior offer at a critical stage of the negotiations is "strong evidence of bad faith").

Under Section 10(c) of the NLRA, 29 U.S.C. 160(c), the Board has the authority to require a violator to take affirmative actions to effectuate the policies underlying the NLRA. The Board's remedies are reviewed for an abuse of its "broad discretion in its field of specialization." NLRB v. Drapery Mfg. Co., 425 F.2d 1026, 1029 (8th Cir. 1970). Upon such review, we conclude that the Board did not abuse its discretion in extending the certification year by six months and ordering Beverly to reinstate its earlier proposals. The six-month extension of the certification year gives the union a reasonable opportunity to engage in the good faith bargaining to which it was entitled. The Board's requirement that Beverly reinstate its earlier proposals similarly restores the status quo between the parties before the unfair labor practices began. The Board's remedies therefore prevent Beverly from benefiting from its wrongdoing and effectuate policies underlying the NLRA.

The order of the Board is enforced.