KELLOGG COMPANY, Petitioner/Cross-Respondent, v. NATIONAL LABOR RELATIONS BOARD, Respondent/Cross-Petitioner, Bakery, Confectionery, Tobacco Workers and Grain Millers International Union, AFL-CIO; Bakery, Confectionery, Tobacco Workers and Grain Millers Local Union 252-G, Intervenors.
Nos. 15-2031/2183
United States Court of Appeals, Sixth Circuit.
Argued: June 16, 2016; Decided and Filed: October 26, 2016
840 F.3d 322
Before: SILER, BATCHELDER, and GIBBONS, Circuit Judges.
AMENDED OPINION
JULIA SMITH GIBBONS, Circuit Judge.
The Kellogg Company (Kellogg) and the Bakery, Confectionery, Tobacco Workers and Grain Millers Local Union 252-G (the Union) began negotiations for a
I.
The relationship between Kellogg and the Union is governed by two separate agreements: the Master Agreement and the supplemental Memphis Agreement. The Master Agreement was effective from September 30, 2012 through October 3, 2015 while the Memphis Agreement was in effect from October 22, 2010 until October 20, 2013. Prior to entering into the Master Agreement, Kellogg entered into “supplemental agreements” with the local union at each plant. The Master Agreement applies to four of Kellogg‘s plants, including the Memphis, Tennessee plant while the Memphis Agreement is specific to the Memphis location. The Master Agreement explicitly covers “only those matters specifically included [t]herein.” Master Agreement 1, CA6 R. 23. It further provides that unless the parties agree, issues covered in the Master Agreement will not be subject to negotiation “in an effort to secure changes in or to secure a new Supplemental Agreement” and issues covered in the supplemental agreements will not be subject to negotiation “in an effort to secure changes in or a new version of [the Master] Agreement.” Id. at 2.
The Master Agreement grants regular employees various benefits such as severance pay, paid holidays, insurance benefits, and participation in a stock purchase and dividend reinvestment plan. The Master Agreement does not distinguish between regular and non-regular employees except for one reference in the Wage Appendix, which governs “[a]ll matters pertaining to hourly wages,” id. at 33, and establishes a rate of $6.00 per hour less than “job rate ... for all work performed by non-regular employees, such as temporary and casual employees.” Id. at 66-67 (emphasis added). This is the only reference to non-regular employees or casual employees in the Master Agreement.
The Memphis Agreement, however, distinguishes between regular and casual employees. Section 107 of the Memphis Agreement defines the purpose of the “casual program” as “provid[ing] regular employees with relief from extended work schedules through the use of Casual employees.” Memphis Agreement 8, CA6 R. 23. Except in limited circumstances, casual employees under the Memphis Agreement would only be “used after overtime has been offered to regular employees” and generally could not be used when regular employees were on layoff. Id. at 8-9. The number of casual employees was also capped at 30% of the total number of regular employees. And though casual employees were offered some “fringe benefits” such as lunch, breaks, and other benefits provided in the Master Agreement‘s Wage Appendix, they were otherwise not
On September 17, 2013, Kellogg and the Union began negotiations for a successor to the Memphis Agreement. The negotiations came to a standstill over Kellogg‘s proposed modifications to the casual program. Under Kellogg‘s proposal, the casual program would no longer serve simply to provide scheduling relief to regular employees, but would “include any employees hired by Kellogg to perform production or any other bargaining unit work covered by” the Memphis Agreement. Kellogg‘s Last/Best Offer 4, CA6 R. 23. Moreover, casual employees would no longer “be limited in the scope of their work, duties, tasks, hours, or in any other terms or conditions of employment” and could “be employed on an indefinite basis,” giving Kellogg unrestricted “rights to hire, use, manage, or direct Casual employees.” Id. Casual employees would also be granted new rights, such as seniority rights, access to a grievance procedure, participation in the job bidding process, and priority in the event that Kellogg established an alternative crewing schedule. The Union steadfastly refused to negotiate with Kellogg concerning these proposals. For instance, when Kellogg‘s representative pressed the Union for alternative solutions to its proposals, the Union representative replied, “No—I don‘t have to do that. I know you are really nice but I don‘t mind telling you no every time.” 2013 Memphis Suppl. Negotiations 23, Sept. 17, 2013, CA6 R. 23. Insisting that Kellogg was attempting to bargain for amendments to the Master Agreement, rather than the Memphis Agreement, the Union representative finally concluded negotiations stating, “we are done negotiating, we are done ... done forever.” 2013 Memphis Suppl. Negotiations 1, Oct. 15, 2013, CA6 R. 23.
After the parties reached impasse,1 Kellogg sent the Union its “Last/Best Offer” dated October 16, 2013, threatening to lock out all Memphis bargaining unit employees effective October 22, 2013, if the Union declined to accept its offer by 7:00 a.m. on that date. When the Union did not respond, Kellogg locked out approximately 200 of its bargaining-unit employees.
The Union filed a complaint on March 27, 2014, and the ALJ held a trial on the alleged unfair labor practice charges. The ALJ noted that the Master Agreement covers little about casual employees, but that supplemental agreements “have determined the scope and operation of the casual employee program at the[] respective plants.” Decision 23, CA6 R. 23. Therefore, the ALJ concluded that Kellogg‘s proposals did not contravene the terms of the Master Agreement, but rather spoke to the provisions of the Memphis Agreement, so the proposals were not midterm modifications of the Master Agreement, but rather mandatory subjects of bargaining. He further determined that a bona fide impasse was reached between the parties due to the Union‘s failure to negotiate the proposals, so Kellogg was entitled to impose a lockout.
The Board reversed the ALJ‘s decision. It concluded that the ALJ “misperceived the impact” of Kellogg‘s proposals, which was to permit Kellogg “to cease hiring all regular employees in the future and replace them with lower paid ‘casual’ employees.” Decision and Order 5, CA6 R. 23 (emphasis added). Kellogg repeatedly sought analogous modifications to regular employees’ wages and benefits during the 2005, 2009, and 2012 negotiations of the Master Agreement, but the parties never
Kellogg petitioned this court for review and the Board filed a cross-application for enforcement of its order.
II.
We review for substantial evidence the Board‘s factual determinations and its application of law to facts. NLRB v. Galicks, Inc., 671 F.3d 602, 607 (6th Cir. 2012). This standard will be met “if a reasonable mind might accept the evidence as ‘adequate to support a conclusion.‘” NLRB v. Int‘l Bhd. of Elec. Workers, 514 F.3d 646, 649 (6th Cir. 2008) (quoting Vanguard Fire & Supply Co. v. NLRB, 468 F.3d 952, 957 (6th Cir. 2006)). We review the Board‘s interpretation of contract terms de novo. NLRB v. Local 334, Laborers Int‘l Union of N.A., 481 F.3d 875, 879 (6th Cir. 2007). Though we also review de novo the Board‘s legal conclusions that are unrelated to the
III.
A.
Kellogg contends that the Board reached its conclusion by “inferring a contractual work guarantee for regular employees that simply does not exist.” Pet‘r Br. 3, CA6 R. 22. This, it argues, is contrary to the language of the Master Agreement, which expressly prohibits the use of implied terms, and further “includes no express guarantees or ‘core work force’ terms governing the allocation of work between casual and regular employees.” Id. at 3-4, 18-21. The only provision in the Master Agreement pertaining to casual employees, Kellogg asserts, is unaffected by its proposal.
The Board responds that Kellogg‘s proposal “would modify the unexpired Master Agreement‘s [express] provisions regarding wages, benefits, overtime, and premium pay” and would further “erase the Master Agreement‘s distinction between ‘regular’ and ‘non-regular‘/‘casual’ employees.” Resp‘t Br. 16, 27, CA6 R. 27. It asserts that because the Master Agreement did not define “casual employees,”
We interpret a CBA as a contract, looking first to its plain language “for clear manifestations of the parties’ intent.” Moore v. Menasha Corp., 690 F.3d 444, 451 (6th Cir. 2012). To the extent we find the plain language ambiguous, we may look outside of the document to determine the parties’ intent by examining “relevant extrinsic evidence, such as a past practice of the parties in regard to the effectuation or implementation of the contract provision in question, or the bargaining history of the provision itself.” Mining Specialists, Inc., 314 N.L.R.B. 268, 268-69 (1994); accord Moore, 690 F.3d at 451.
The Master Agreement covers “only those matters specifically included [t]herein.” Master Agreement 1, CA6 R. 23. The only reference to casual employees specifically included therein pertains to the wage rate for casual employees and the Board does not contest that Kellogg‘s proposal does not affect this provision. The Master Agreement has no “system” of regular and casual employees. See Resp‘t Br. 21, CA6 R. 27. It is the Memphis Agreement, regarding which both parties were required to negotiate, that defines casual employees and sets forth the terms of the casual program. As the Master Agreement does not distinguish between regular and casual employees aside from the limited purpose of wages, the Board is incorrect that the proposal erases the Master Agreement‘s distinction between the two, as there is no such distinction to erase. The provisions pertaining to regular employees in the Master Agreement are untouched by the proposal.
The Board also makes much of the definition of casual employees, but casual employees were never defined in the Master Agreement. The definition was included in the Memphis Agreement‘s description of the casual program. Likewise, though the Board complains that under the proposal, Kellogg could hire new casual employees while regular employees were in layoff, the obligation imposed on Kellogg not to do so is one placed on it by the Memphis Agreement, not the Master Agreement.
In looking to the plain, unambiguous language of the Master Agreement and the proposal, the latter simply does not modify the former so we need not look outside of the text of either writing. Thus, the success of the Board‘s argument turns on the viability of its effective modification theory.
B.
Kellogg next argues that the Board‘s decision conflicts with its precedent in Milwaukee Spring. According to Kellogg, Milwaukee Spring stands for the proposition that, in determining whether there has been a modification, the Board must identify a specific term contained in the contract and is not permitted to find “an implied work preservation term ‘based on wage and benefits or recognition provisions’ in an unexpired contract.” Pet‘r Br. 4, 31-32, CA6 R. 22. Thus, it concludes, there can be no effective modification under
While the Board concedes that the Master Agreement does not guarantee regular employees any “minimum hours of work, overtime, or particular schedules,” it contends that the proposal not to hire any regular employees would effectively terminate any provisions for newly hired regular employees. Resp‘t Br. 26-27, CA6 R. 27. The Board also insists that Milwaukee Spring “simply held that no term in the parties’ single contract had been modified, effectively or otherwise,” but that subse-
To resolve this issue, we first turn to Milwaukee Spring. We note, though, that the Board did not mention or discuss Milwaukee Spring in its decision.
The employer in Milwaukee Spring asked the union to forgo a scheduled wage increase or, alternatively, to relocate the union‘s operations to a nonunionized facility so that the employer could obtain relief from the comparatively higher labor costs at the unionized Milwaukee Spring facility. 268 N.L.R.B. at 601. Though the union rejected these proposals, the employer nevertheless relocated work to the nonunionized facility. Id. Applying the principles underlying
Subsequent decisions likewise require that the Board find a specific term in the contract that is modified by the proposal and prohibit the Board from implying a work preservation term based on “wage and benefits provisions” in an agreement. See, e.g., FMC Corp., 290 N.L.R.B. 483, 484-85 (1988) (relying on Milwaukee Spring in concluding that “there [was] no evidence that the parties’ contract contained a provision which restricted or otherwise preserved the performance of the [bargaining-unit] work to the [unionized] facility,” so the employer did not engage in an unlawful mid-term modification); Ad-Art, Inc., 290 N.L.R.B. 590, 607-08 (1988) (concluding that Milwaukee Spring was inapplicable because the contract at issue “contained express provisions prohibiting the reassignment or transfer of work without the Unions’ consent“). For instance, in Suburban Transit Corp., the employer transferred work from one set of employees, employed by Transit, to another, employed by Trails, despite the union‘s rejection of the proposal. 276 N.L.R.B. 15, 18 (1985). Prior to the Board‘s decision in Milwaukee Spring, the ALJ concluded that the employer violated the
Many of the cases relied on by the Board on appeal include an express term that was directly, not effectively, modified by the employer‘s proposal, and thus are inapplicable to the Board‘s effective modification theory. E.g., St. Vincent Hosp., 320 N.L.R.B. 42, 42-45 (1995) (concluding that the employer violated the NLRA by making a mid-term modification concerning a healthcare plan that was “contained in” the CBA after the parties, by “mutual consent” orally added the healthcare plan to the CBA); E.G. & G. Rocky Flats, Inc., 314 N.L.R.B. 489, 493, 497 (1994) (concluding that the employer violated the NLRA by temporarily suspending a training program that was added by agreement of the parties to the CBA); Link Corp., 288 N.L.R.B. No. 132, 1988 WL 213934, at *2 (1988) (“[T]he Respondent unilaterally modified the terms of article XXXIII of the agreement by ceasing to make required premium payments and thereby effectively terminating all employee group insurance benefits set forth in that article.” (emphasis added)); Martin Marietta Energy Sys., 283 N.L.R.B. 173, 174-75 (1987) (concluding that the employer unlawfully modified the CBA mid-term by adding a new health insurance plan because, although the employees were free to continue in “the negotiated medical insurance plan,” the CBA provided that there could be “no ‘additions, waivers, deletions, changes or amendments (to the contract) ... except by mutual consent in writing‘” (alteration in original)); C & S Indus., Inc., 158 N.L.R.B. 454, 458-59 (1966) (concluding that the employer committed an unlawful mid-term modification in initiating a wage incentive system where there was a term in the contract prohibiting any change in the method of payment).
The remaining cases cited by the Board are likewise inapposite. The Union, in its intervenor‘s brief, points to Don Lee Distributor, Inc. v. NLRB, 145 F.3d 834, 843-44 (6th Cir. 1998), where this court held that there were no “magic words” distinguishing between an unlawful bargaining pact or innocent coordination, but looked to the “totality of the circumstances” to
In sum, the cases relied upon by the Board on appeal do nothing to rebut the principles articulated in Milwaukee Spring. Turning to the facts of this case, the Board‘s position is inconsistent with these principles for several reasons. For one, as discussed above, there is no specific term in the Master Agreement modified by Kellogg‘s proposal. Moreover, Milwaukee Spring and the cases interpreting it disclaim any effective modification theory. A comparison of the facts of this case to Suburban Transit illustrates the inapplicability of the Board‘s theory. As the ALJ found to be the case in Suburban Transit, the Union argued Kellogg “attempted to accomplish indirectly what it could not legally do directly—the modification of the terms of the” unexpired Master Agreement. See 276 N.L.R.B. at 18. But in Suburban Transit, the employer‘s actions were not in violation of the
It may be true, as the Board contends, that these principles allow Kellogg to use “creative semantics” to negotiate for terms in the Memphis Agreement that the Union declined to accept in the negotiations for the Master Agreement. Yet, as illustrated by Board precedent, this is acceptable. It is for the Board, not this court, to balance “conflicting legitimate interests in pursuit of the national policy of promoting labor peace through strengthened collective bargaining.” Montague, 698 F.3d at 314 (citation omitted) (internal quotation marks omitted). If the Union wanted to provide for a “core work force of permanent full-time employees,” see Decision and Order 5, CA6 R. 23, to work at Kellogg and provide them with a set amount of work, the Union could have bargained for terms to that effect in the Master Agreement, but it did not. To the contrary, it refused to bargain. Because Kellogg‘s proposal is not a mid-term modification of the Master Agreement, Kellogg‘s insistence upon its terms to the point of impasse, and subsequent lockout, did not violate the
Although we defer to the Board‘s interpretations of the NLRA if “reasonably defensible,” Int‘l Bhd. of Elec. Workers, 514 F.3d at 650, it is this court‘s duty not to merely “rubber-stamp” the Board‘s conclusion, but to carefully scrutinize whether it abided by its own precedent. Vokas, 796 F.2d at 869. Here, the Board did not abide by its precedent or explain its failure to do so.
C.
As to the Board‘s finding that Kellogg violated
IV.
For the aforementioned reasons, we grant the petition for review, grant enforcement and affirm the Board‘s decision with respect to the information-request finding, and vacate the remainder of the Board‘s decision.
Notes
Id. (emphasis added).Suburban shall have the right to hire part time drivers.
It is the Company‘s intention to maintain at least the current level of 90 full time drivers, provided that the current level of business continues. The Company further intends to enlarge the full time work force.
Part time drivers will be used only when there is an insufficient number of full time drivers to cover all of the available work. In all cases the full time drivers shall have their choice between line and charter work provided that there are part time drivers available to cover all open line work. In all cases full time drivers shall have their choice of the biggest paying pieces of work. The Company will also attempt to satisfy full time regular run operators in the assignment of extra work, providing sufficient operators are available to cover all open work.
The limit of work available to full time drivers will be governed only by the “hours of service” regulations of the Department of Transportation, and not by the availability of part time drivers.