MEMORANDUM AND ORDER
This matter is before me on petitioner’s motion for a temporary injunction under § 10(j) of the National Labor Relations Act, 29 U.S.C. § 160(j). Petitioner seeks an injunction barring respondent from violating several provisions of the Act pending final disposition of unfair labor practices charges currently before the National Labor Relations Board. After the issues were fully briefed, I held a hearing on October 12, 2012 to permit the parties to present oral argument and evidence on the propriety of issuing the injunction. After carefully considering the parties’ briefs, the arguments of counsel, and the testimony and evidence presented at the hearing, I will grant petitioner’s motion for the following reasons.
Background Facts
Petitioner is the Acting Regional Director of Region 14 of the Board and filed this petition on its behalf. Respondent is
On July 21, 2011, Southside Temporaries provided respondent a rate quote for the inspectress and housemen work. At the time, Southside was already providing respondent with other workers to help restore the hotel after a fire. On October 15, 2011, the union representative Harry Moore told respondent that the union contract was about to expire and that the union would like to meet. On November 21, 2011, Moore met with respondent’s managing member Naresh Patel and its general manager Bill Thompson to discuss negotiating a successive collective-bargaining agreement. At the meeting, Moore presented Patel and Thompson with the union’s contract proposal. Patel responded to that proposal by stating, “Harry, we don’t have any need for union employees because it is all subcontracted out.” According to Patel, “The Union rep wanted us to sign a new agreement, and we refused because there was nothing for union employees to do there. There was no positions left; they had been subcontracted out to Southside.” Respondent admitted that when he met with Moore that “it did not make a difference whether Moore wanted an increase or a decrease in pay because the decision had been made to subcontract out the work.” The day the union contract expired, respondent fired Poetting and Wholdmann and replaced them with Southside employees who are doing Poetting and Wholdmann’s jobs for a highly hourly wage. Respondent did not sign a new union contract.
The union filed an unfair labor practices charge on May 11, 2012. Following an investigation, petitioner found reasonable cause to support the charge and filed a complaint and notice of hearing. In the complaint before the Board, petitioner alleges that respondent refused to bargain with the union for a successor contract, unilaterally subcontracted all unit work, unilaterally terminated all unit employees, and unlawfully withdrew recognition from the Union in violation of 8(a)(1) and (5) of the Act, 29 U.S.C. § 158(a)(1) and (5).
Discussion
Section 10(j) allows the Board to petition a district court for temporary injunctive relief pending resolution of an underlying case. The Act provides, in pertinent part:
The Board shall have power, upon issuance of a complaint as provided in subsection (b) of this section charging that any person has engaged in or is engaging in an unfair labor practice, to petition any United States district court ... for appropriate temporary relief or restraining order. Upon the filing of any such petition the court shall cause notice thereof to be served upon such person, and thereupon shall have jurisdiction to grant to the Board such temporary relief or restraining order as it deems just and proper.
29 U.S.C. § 160(j). In deciding whether a § 10j injunction would be “just and proper” under the Act, I must apply the preliminary injunction factors set out in Dataphase Systems, Inc. v. C L Systems, Inc.,
(1) the threat of irreparable harm to the movant; (2) the state of balance between this harm and the injury that granting the injunction will inflict on other parties litigant; (3) the probability that movant will succeed on the merits; and (4) the public interest.
Dataphase,
A. Threat of Irreparable Harm to Petitioner
To obtain Section 10(j) injunctive relief, the Board must first show “the case presents one of those rare situations in which the delay inherent in completing the adjudicatory process will frustrate the Board’s ability to remedy the alleged unfair labor practices.” Sharp,
Here, respondent completely eliminated the bargaining unit and replaced the union workers with non-union members after flat-out refusing to negotiate with the union. This activity goes to the very heart of what the NLRA was enacted to protect. See id. at *3. Interim injunctive relief is necessary because it will likely be next May before the NLRB issues its final decision, and the longer respondent keeps the union at bay, the harder it will be for the
Respondent complains that it would be financially devastated if reinstatement and back pay were awarded. It is important to note, however, that petitioner is not asking me to award back pay in this proceeding. The issue of back pay is before the ALJ, not me. However, respondent’s claimed inability to afford back pay actually weighs in favor of interim relief because reinstatement cuts off any continued accrual of backpay. As for respondent’s claims that it cannot afford reinstatement, I find Patel’s testimony at the October 12, 2012 hearing not credible on this issue. The evidence submitted by petitioner in support of the motion demonstrates that the unit members were replaced with subcontractors who are paid a higher hourly rate of pay than Poetting and Wholdmann.
Respondent argues against interim relief by claiming the request is untimely. In support of this argument, respondent points out that the union waited five months after the collective bargaining agreement expired before it filed an unfair labor practices charge, and that petitioner waited ten months to seek temporary injunctive relief. After considering the briefs and the arguments of counsel at the hearing, I do not find the request for interim relief to be untimely. Petitioner acted diligently in pursuing this case once it was filed, and the Board did not unduly delay seeking interim relief. As the district court held in CMPJ Enterprises,
B. Likelihood of Success on the Merits
In addressing this factor, I must not second guess the Board’s decision to commence enforcement proceedings. Sharp,
Petitioner asserts that respondent transferred work outside the bargaining unit, which is a mandatory subject of bargaining requiring notice and an opportunity to bargain. See In re Suffield Academy,
Here, respondent argues that petitioner is unlikely to succeed on the merits because subcontracting is not a mandatory subject of bargaining if it involves a substantial capital commitment or change in the nature, scope, or direction of the business. It also contends that it was not required to bargain with the unit because it has changed the scope of its business, with the hotel becoming more apartment-like. Finally, respondent maintains that it was permitted to subcontract out the unit work under the terms of the expired collective bargaining agreement, which provides that “[f]rom time to time the Company shall hire outside contractors and employees of such contractors shall not be under the jurisdiction of the Union.” The agreement also contains a management rights clause which gives respondent the right to “relieve employees from duty because of lack of work or for other legitimate reasons.... ” Respondent argues that this language amounts to a waiver by the union to bargain this issue and points to the ALJ’S request at the hearing that the parties focus their briefs on this issue.
Waiver of bargaining rights can occur by express provision in the collective bargaining agreement, by the conduct of the parties, or by a combination of the two. American Diamond Tool, Inc.,
As for the allegation that it refused to bargain, respondent argues that the union waived its right to do so by failing to promptly request bargaining af
It is not for me to decide whether respondent violated labor laws. Here, the contractual language and the union’s conduct do not amount to a “clear and unmistakable showing that the Union waived it right to bargain over” the termination of the union employees in favor of subcontractors. Id. at 1263 (waiver of rights requires “clear and unmistakable showing”). When this factor is considered in the appropriate context of whether to grant a 10(j) injunction, petitioner has presented sufficient evidence to support its allegations that respondent transferred work outside the bargaining unit without giving the union notice and the opportunity to bargain. Before the expiration of the collective bargaining agreement, respondent told the union that they were not renewing the contract because the union positions had already been taken by subcontractors. The day the union contract expired, the union employees were fired and replaced by subcontractors. No bargaining unit members remain at the hotel. Although Patel now equivocates about his prior statements to Moore and tries to soften their impact with after-the-fact assurances that he remains willing to negotiate with the union, it is clear that he flatly refused to do so. As for the union’s prior conduct, petitioner has presented evidence that the union had no knowledge of respondent’s prior use of subcontracting services or the reduction in bargaining unit members until it was too late to grieve these actions. Finally, the language of the collective bargaining agreement does not, as respondent claims, give it the right to unilaterally eliminate the bargaining unit in favor of subcontractors. For these reasons, the Court finds that petitioner has presented sufficient evidence to establish a likelihood of success on the merits, so this factor weighs in favor of the requested injunctive relief.
C. Balance of Harms
Petitioner argues this factor weighs in favor of injunctive relief because, if relief is granted, respondent will have competent, experienced employees who can perform the job successfully and respondent admits that it can terminate its subcontract at any time without notice or cost. Moreover, petitioner argues that any alleged increased cost to rehiring displaced workers is minimal and only temporary. I have already addressed respondent’s arguments that an award of interim relief would cause grave financial harm to respondent, so I do not repeat those findings and conclusions here. I find that the balance of harms weighs in favor of issuing interim injunctive relief, where respondent incurs no costs to terminate the subcontractors and reinstate the unit members. Respondent maintains its managerial rights to discipline and supervise these employees, and reinstatement effectuates the purposes of the Act because respondent will not continue to accrue back pay. Moreover, any interim bargaining order would not require respondent to agree to
D. Public Interest
Finally, petitioner argues the public interest is served by protecting the underlying remedial purposes of the Act. Although it would certainly not be in the public interest if respondent was forced to close its hotel, I do not find that to be a potential harm if interim injunctive relief is awarded in this case. The Court finds that the public interest in protecting employees’ rights, preserving the remedial power of the Board, and safeguarding the collective bargaining process weighs in favor of issuing interim injunctive relief.
Conclusion
For all these reasons, after careful consideration of all the evidence and briefs, I find that petition is entitled to injunctive relief.
Accordingly,
IT IS HEREBY ORDERED that:
1. Respondent, its officers, agents, servants, employees, attorneys, and all persons acting in concert or participation with it or them, pending the final disposition of the matters involved herein pending before the Board, are enjoined and restrained from engaging in the following acts and conduct:
(a) Refusing to recognize and bargain in good faith with UNITE HERE Local 74 (Union) as the exclusive collective-bargaining representative of the employees in the following unit: All housekeeping employees, including inspectress and houseman, employed by Respondent at its St. Ann, Missouri facility, excluding office clerical employees, professional employees, guards, and supervisors as defined in the Act;
(b) Failing and refusing to adhere to the terms and conditions of employment set forth in the expired collective-bargaining agreement with the Union applicable to the employees in the unit described in paragraph 1(a) above until the parties bargain in good faith to an agreement or to lawful impasse;
(c) Failing and refusing to make contributions to the Union’s health and welfare, pension, and other funds as required by the 2010-2011 collective-bargaining agreement;
(d) Unilaterally contracting out work traditionally performed by the unit and terminating unit employees described in paragraph 1(a) above; and
(e) . In any like or related manner interfering with, restraining, or coercing employees in the exercise of the rights guaranteed them by Section 7 of the Act.
2. Respondent is hereby ordered to:
(a) Rescind the subcontract covering all housekeeping employees in the unit described in paragraph 1(a) above, displacing as necessary the employees of the subcontractor;
(b) Upon request, recognize and bargain in good faith with the Union as the exclusive collective-bargaining representative of the employees in the applicable collective-bargaining Unit;
(c) Upon request, restore and continue to maintain the status quo ante for all terms and conditions of employment as provided in the collective-bargaining agreement with the Union;
(d) Within 5 days of this Order, offer immediate reinstatement to Tamera Poetting and Gary Wholdmann to their former jobs without prejudice to theirseniority or any other rights or privileges previously enjoyed;
(e) Within 14 days of this Order, post copies of the order at the Employer’s St. Ann, Missouri facility in all places where the Employer’s notices to employees are customarily posted. Said postings shall be maintained during the pendency of the Board’s proceedings free from all obstructions and defacements, and agents of the Acting Regional Director of Region 14 of the Board shall be granted reasonable access to the Employer’s St. Ann, Missouri, facility to monitor compliance with this posting requirement; and
(f) Within 14 days of this Order, submit to the Acting Regional Director of Region 14 of the Board, a sworn affidavit from a responsible Employer official describing with specificity the manner in which the Employer has complied and will continue to comply with the terms of the District Court’s decree, including the location of the documents to be posted under the terms of this decree.
IT IS FURTHER ORDERED that this case shall remain on the docket of this Court and on compliance by Respondent with its obligations undertaken hereto, and upon disposition of the matters pending before the Board, the Petitioner shall cause this proceeding to be dismissed.
Notes
. Those provisions of the Act provide that it shall be an unfair labor practice for an employer "to interfere with, restrain, or coerce employees in the exercise of the rights guaranteed in section 157 of this title” and "to refuse to bargain collectively with the representatives of his employees, subject to the provisions of section 159(a) of this title.”
. As for respondent’s contention that it would be required to pay overtime if it reinstated Poetting and Wholdmann, petitioner correctly noted at the hearing that respondent is free to hire additional unit members, including temporary workers, to perform this unit work instead of paying overtime wages to Poetting and Wholdmann. In any event, I find that Patel greatly exaggerated the amount of overtime hours, if any, that would be required if reinstatement were ordered.