Independent Electrical Contractors v. National Labor Relations Board
720 F.3d 543
5th Cir.2013Background
- IEC-Houston, a trade group for electrical contractors, challenged NLRB orders targeting its member referral and staffing programs.
- Charges began in 1996–1997 with IBEW Local 716 accusing IEC-Houston of 8(a)(3) discrimination and salts; subsequent related case KenMor Electric Co. followed in 1998–2010.
- IEC-Houston operated two core services: a shared man program for borrowing workers and an application referral service for members’ hiring needs, plus newsletters bearing anti-union content.
- ALJs found unlawful practices under 8(a)(3) and 8(a)(1); Board later relied on an independent 8(a)(1) theory based on overall system effects rather than just 8(a)(3) discrimination.
- Boards’ KenMor and Independent Electrical Contractors decisions formed the basis for petitions; the court granted IEC-Houston’s petition and denied enforcement of the Board’s cross-petition due to due process concerns.
- The panel concluded the Board denied due process by adopting a novel 8(a)(1) theory and by altering theories midstream without proper notice.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the Board violated due process by applying a novel 8(a)(1) theory. | IEC-Houston argues the Board relied on an unpleaded theory. | Board asserts it properly addressed related issues and linked facts. | Granted: due process denied; novel 8(a)(1) theory improper. |
| Whether § 10(e) exhaustion prevents review of the due process claim. | IEC-Houston contends exceptional circumstances justify review. | Board and Union argue exhaustion not satisfied; waiver applies. | Granted: extraordinary circumstances support review of due process claim. |
| Whether the Board’s § 8(a)(1) finding is supported by substantial evidence. | IECH argues evidence does not prove interference with §7 rights; business justifications present. | Board found overall system interfered with union applicants, with substantial record. | Denied: the Board’s §8(a)(1) finding is not upheld; due process defects require reversal. |
| Whether the merger of KenMor and Independent Electrical Contractors decisions warrants consolidated review. | Combined facts show consistent errors; due process concerns persist. | Cases share operative facts; consolidation is appropriate. | Grants petition; cross-petition denied; issues reviewed together. |
| Whether the September Order is reviewable given lack of aggrieved status. | September Order directly affects IEC-Houston. | September Order dismisses allegations as redundant and does not adverse affect IEC-Houston. | Limitations on review acknowledged; August Order controls; SEP order not independently reviewable. |
Key Cases Cited
- Town & Country Elec., Inc. v. NLRB, 516 U.S. 85 (1995) (unpaid salts protected as employees under NLRA; right to seek work protected)
- Metro. Edison Co. v. NLRB, 460 U.S. 693 (1983) (distinguishes 8(a)(1) from 8(a)(3); requires balancing rights and business justifications)
- Champion Int’l Corp., 339 NLRB 672 (2003) (due process limits when theory shifts midlitigation; require reversal/dismissal)
- Pergament United Sales, Inc., 296 NLRB 333 (1989) (limits on reliance on uncharged theories when closely connected to charge)
- Cardinal Home Prods., Inc., 338 NLRB 1004 (2003) (upholds related-but-not-identical theories when closely connected to complaint)
- Ang Newspapers, 343 NLRB 564 (2004) (balancing business justifications against employee rights in 8(a)(1) cases)
- Zurn/N.E.P.C.O., 345 NLRB 12 (2005) (disparate impact considerations in NLRA context (narrowly cited))
- In re Sierra Bullets, LLC, 340 NLRB 242 (2003) (notice and broader theory implications in Board decisions)