MICHIGAN COMMUNITY SERVICES, INC., et al., Petitioners/Cross-Respondents,
American Federation of State, County & Municipal Employees (AFSCME), AFL-CIO, Petitioner/Cross-Respondent,
v.
NATIONAL LABOR RELATIONS BOARD, Respondent/Cross-Petitioner,
American Federation of State, County & Municipal Employees (AFSCME), AFL-CIO; International Union, United Automobile, Aerospace and Agricultural Implement Workers of America, AFL-CIO; Summer's Living Systems, Inc., et al., Intervenors.
No. 00-2192.
No. 00-2440.
No. 00-2451.
United States Court of Appeals, Sixth Circuit.
Argued: July 31, 2002.
Decided and Filed: October 30, 2002.
COPYRIGHT MATERIAL OMITTED Gregory J. Bator (argued and briefed), Circuit Judges. Bator & Berlin, Birmingham, MI, for Petitioners Cross-Respondents in 00-2192, 00-2440.
Daniel A. Gwinn (briefed), Bator & Berlin, Birmingham, MI, for Petitioners Cross — Respondents in 00-2440.
Catherine J. Trafton (briefed), Associate General Counsel, International Union, UAW, Detroit, MI, George B. Washington (briefed), Scheff & Washington, Detroit, MI, for Intervenor in 00-2192.
Richard A. Cohen (argued and briefed), Fred L. Cornnell, Jr., National Labor Relations Board, Office of the General Counsel, Washington, DC, Aileen A. Armstrong (briefed), Dep.Asso.Gen.Counsel, Julie B. Broido, National Labor Relations Board, Appellate Court Branch, Washington, DC, Amy J. Roemer, National Labor Relations Board, Region Seven, Detroit, MI, for Respondent Cross-Petitioner for 00-2192, 00-2440.
Margaret A. McCann (argued and briefed), Washington, DC, Lawrence R. Webb (briefed), Detroit, MI, for Intervenor in 00-2192.
Margaret A. McCann (argued and briefed), Washington, DC, Rodger Webb (briefed), Detroit, MI, for Petitioner in 00-2451.
Daniel A. Gwinn (briefed), Gregory J. Bator (argued and briefed), Bator & Berlin, Birmingham, MI, for Intervenors in 00-2451.
Richard A. Cohen (argued), Fred L. Cornnell, Jr., National Labor Relations Board, Office of the General Counsel, Washington, DC, Aileen A. Armstrong (briefed), Dep.Asso.Gen.Counsel, Julie B. Broido, National Labor Relations Board, Appellate Court Branch, Washington, DC, for Respondents in 00-2451.
Before: SILER, COLE, and CLAY, Circuit Judges.
OPINION
CLAY, Circuit Judge.
Michigan Community Services, Inc. and twenty-eight other non-profit corporations (collectively "MCS"), which are licensed by the State of Michigan to provide residential care for developmentally disabled adults in a residential setting, appeal in Case No. 00-2192 from the final decision and order entered by the National Labor Relations Board ("the NLRB" or "the Board") in Summer's Living Systems, Inc.,
In Summer's Living Systems, the Board issued a decision and order affirming the decision made by the administrative law judge ("ALJ") to extend comity to the union representation elections conducted by the Michigan Employee Relations Commission ("MERC") in thirty residential care facilities owned by MCS that took place before Management Training Corp.,
BACKGROUND
The present case concerns a dispute between a group of Michigan non-profit corporations operating group homes providing residential care and services to individuals with disabilities (collectively "the Employers") and the Unions representing their employees regarding the employees' rights to choose union representation under § 7 of the Act. The State of Michigan Department of Mental Health ("MDMH") funds the Employers' operations through annual contracts that establish defined limits upon wages and benefits that the Employers may pay. In 1985, the Unions began organizing efforts at the Employers' residential care facilities, with AFSCME filing several election petitions with the Board's regional office in Detroit, Michigan, seeking to represent the employees of the Employers operating under contracts with MDMH. In CK Homes, Inc. v. AFSCME, an unpublished decision of the NLRB Seventh Region Director, decided February 14, 1986 (Case No. 7-RM-1275) and Residential Systems v. UAW, an unpublished decision of the NLRB Seventh Region Director, decided April 7, 1988 (Case No. No. 7-RC-18529), the Board, relying primarily upon Res-Care Inc.,
Thereafter, on January 28, 1988, AFSCME filed petitions with MERC seeking to represent the employees of the Employers' separate units, naming MDMH and the group home providers as joint employers. MDMH opposed the petitions naming it as a joint employer, claiming that MERC's jurisdiction over each private employer was preempted as a matter of federal labor policy. After finding that the named employers were joint employers, MERC asserted jurisdiction over MDMH under the Michigan Public Employment Relations Act ("PERA"), Mich. Comp. Laws Ann. §§ 423.201-423.216, and over the group home providers under the Michigan Labor Mediation Act ("MLMA"), Mich. Comp. Laws Ann. §§ 423.1-423.30. In asserting jurisdiction, MERC relied upon the Board's refusal to assert jurisdiction over the group home providers under the Act and the decision of the Michigan Civil Service Commission not to classify the employees of the group homes as state civil service employees. See AFSCME v. La. Homes, Inc./Mich. Dep't of Mental Health, MERC Case No. R88 C-112, 1989 MERC Lab Op 51, 1990 MERC Lab Op 491, aff'd, AFSCME v. La. Homes,
MERC then directed and conducted elections involving the joint employers, as authorized by PERA. After elections were conducted on April 20, 1989, the ballots were impounded, but eventually counted by MERC on June 29, 1990. The Unions won each election.1 As a consequence, MERC certified the bargaining representatives, giving unit employees bargaining rights with respect to MDMH and their private employers, as joint employers. MDMH, however, refused to honor MERC's certifications and challenged them in state court, seeking judicial review of the MERC's assertion of jurisdiction by claiming that it was not a joint employer of the subject-unit employees and contending that the Act preempted state law. MERC's assertion of jurisdiction was eventually upheld on appellate review in the Louisiana Homes litigation. Throughout the appellate proceedings, the Employers took the same position as AFSCME, that they and MDMH were joint employers subject to MERC's jurisdiction which was not preempted by the Act. During this time, however, no bargaining in the certified units took place because the Employers were unwilling to participate in bargaining if MDMH was also not a participant.
After the United States Supreme Court denied MDMH's petition for a writ of certiorari in the Louisiana Homes case on January 9, 1995, bargaining eventually commenced, but did not last long. In mid-1995, the Board announced a change in policy in Management Training, overruling the test stated in Res-Care and declaring that it had jurisdiction over private employers under contract with exempt state agencies. In light of the Board's decision in Management Training, MDMH petitioned the Michigan Court of Appeals to reconsider and reverse its previous decision finding that MERC's jurisdiction was not preempted as a matter of federal labor policy. Thereafter, on January 26, 1996, the Michigan Court of Appeals, in reliance upon Management Training, vacated MERC's decisions requiring the Employers and MDMH to bargain with the Unions in all the adult residential care cases before MERC, concluding that MERC's jurisdiction was preempted as a matter of federal labor policy. AFSCME v. Mental Health Dep't.,
In the meantime, after the Board's decision in Management Training, but before the Michigan Court of Appeals ruled on the federal preemption issue in AFSCME v. Mental Health Dep't, AFSCME proceeded with elections that previously had been directed by MERC, though not yet conducted. AFSCME won those union representation elections involving the employees of units of Summer's Living Systems, Inc. and eight other employers ("SLS"). However, following the Michigan Court of Appeals' decision in AFSCME v. Mental Health Dep't vacating MERC's certifications on preemption grounds, the State of Michigan refused to bargain with the Unions. When the Unions requested that the Employers continue to bargain under the Act without MDMH's participation, the Employers refused, claiming that the changed circumstance — the absence of MDMH from the bargaining process — undermined the efficacy of MERC's elections as a basis for requiring the Employers to bargain as a matter of federal labor policy. Thus, all collective bargaining came to a halt. The Unions contacted the Board on March 18, 1996, formally demanding bargaining by the Employers.
Thereafter, the Unions filed unfair labor practice charges with the Board against thirty-eight of the group home providers contracted by MDMH, alleging refusal to bargain under the Act as the sole employers of employees in the subject units.3 Based upon the charges filed by the Unions, the Board issued a series of consolidated unfair labor practice complaints alleging that the refusal to bargain violated § 8(a)(1) and (5) of the Act, 29 U.S.C. § 158(a)(1) and (5). After hearings in Detroit, Michigan on January 29 and 30, 1997, the administrative law judge ("ALJ") issued a decision in which he found it appropriate to extend comity to the elections that MERC had conducted when MERC properly had jurisdiction over the private employers.4 Thus, the ALJ found that MCS violated § 8(a)(1) and (5) of the Act, 29 U.S.C. § 158(a)(1) and (5) by refusing to recognize and bargain with the Unions.5 In so holding, the ALJ rejected the Employers' argument that the absence of MDMH from the bargaining table represented a changed circumstance that prevented the Board from extending comity to the MERC elections as a matter of federal labor policy. However, with regard to SLS, the ALJ held that its employees had voted in elections conducted by MERC after the Board's announced change in policy preempted MERC's jurisdiction. Thus, the ALJ dismissed the unfair labor practice allegations as to SLS, finding that the principles of comity should not be applied to the MERC-conducted elections due to MERC's lack of jurisdiction.
In its decision issued on September 25, 2000, the Board affirmed the ALJ's decision to extend comity to the MERC elections that took place before Management Training was decided on July 28, 1995, but not to extend comity to the MERC elections that took place after Management Training was decided "when [MERC] did not have jurisdiction." Summer's Living Systems, Inc.,
In its appeal in Case No. 00-2192, MCS contends that the representation elections should be invalidated because the elections were conducted under the misrepresentation that the State of Michigan was a joint employer. According to MCS, "the post-election departure of the State of Michigan from its role as co-employer was a material change in circumstances that so radically affected relationships at the bargaining table that the employees lacked any knowledge of the true context in which their votes for unionization were cast." MCS Br. at 7-8. In Case No. 00-2440, the NLRB cross-petitions for enforcement of its order. On the other hand, AFSCME in its appeal in Case No. 00-2451 argues that the Board erred in not extending comity to the elections that MERC conducted after Management Training was decided.
DISCUSSION
Before addressing the merits of the Board's decisions to extend comity to the MERC-conducted elections before the date on which Management Training was decided, but not to those conducted after Management Training was issued, it is useful to consider the key decisions culminating in the Board's change of policy articulated in Management Training regarding its jurisdiction over certain private employers with contractual relationships with exempt governmental entities. Initially, in National Transportation Service, Inc. v. Truck Drivers & Helpers of America, Local Union 728,
[I]n this and future cases involving a determination whether the Board should assert jurisdiction [over an employer with close ties to an exempt entity], we shall determine whether the employer itself meets the definition of "employer" in [29 U.S.C. 152(2)],6 and, if so, determine whether the employer has sufficient control over the employment conditions of its employees to enable it to bargain with a labor organization as their representative.
... Once it is determined that the employer can engage in meaningful collective bargaining with representatives of its employees, jurisdiction will be established.
Nat'l Transp. Serv. Inc.,
Thus, the Employer may be considered to be tantamount to an administrative arm of the government and not within the definition of [29 U.S.C. 152(2)]. In addition, the control possessed and exercised over the Employer's operations by the State of Michigan makes meaningful collective bargaining impossible.... Accordingly, as the Board does not have jurisdiction over the employer, I shall dismiss the petition.
CK Homes at A-9 (J.A. at 272); Residential Sys. v. UAW, an unpublished decision of the NLRB Seventh Region Director, decided April 7, 1988 (Case No. No. 7-RC-18529) (J.A. at 274-82).
Subsequently, in Res-Care, Inc.,
In applying [the National Transportation] test, however, we will examine closely not only the control over essential terms and conditions of employment retained by the employer, but also the scope and degree of control exercised by the exempt entity over the employer's labor relations, to determine whether the employer in issue is capable of engaging in meaningful collective bargaining.
Res-Care,
In Res-Care, the Board held that, in deciding whether it would assert jurisdiction over an employer with close ties to an exempt government entity, it would examine the control over essential terms and conditions of employment retained by both the employer and the exempt entity to determine whether the employer in issue is capable of engaging in meaningful collective bargaining.
* * *
[I]n determining whether the Board should assert jurisdiction, the Board will only consider whether the employer meets the definition of "employer" under [29 U.S.C. 152(2)] of the Act, and whether such employer meets the applicable monetary jurisdictional standards.7
Mgmt. Training,
Case No. 00-2192:MCS' Petition
In this case, we review de novo the Board's legal conclusions regarding whether comity should be extended to the MERC-conducted elections held before and after the issuance of Management Training, and its findings of fact under the substantial evidence standard. Harborside Healthcare, Inc. v. NLRB,
As a legal doctrine, comity originally emerged in the context of international law to reflect the recognition by one state or nation of the laws, policies and judicial acts of another. See Black's Law Dictionary, 261-62 (7th ed. 1999) ("The comity principle is most accurately characterized as a golden rule among nations — that each must give the respect to the laws, policies and interests of others that it would have others give to its own in the same or similar circumstances.")(quoting Thomas Buergenthal & Harold G. Maier, Public Int'l Law in a Nutshell 178 (2d ed.1990)). As explained by the Supreme Court in Hilton v. Guyot,
"Comity" in the legal sense, is neither a matter of absolute obligation, on the one hand, nor of mere courtesy and good will, upon the other. But it is the recognition which one nation allows within its territory to the legislative, executive, or judicial acts of another nation, having due regard both to international duty and convenience, and to the rights of its own citizens, or of other persons who are under the protection of its laws.
Id. at 163-64. By extension, the rule of comity also applies to the recognition of federal and state courts of their respective judgments in our federal system of governance. See Ruhrgas AG v. Marathon Oil Co.,
"Comity" is a notion of highly uncertain content. The Board refers us to the statement in Mast, Foos & Co. v. Stover Mfg. Co.,
Comity is not a rule of law, but one of practice, convenience and expediency... (which) has a substantial value in securing uniformity of decision, and discouraging repeated litigation of the same question ... its obligation is not imperative.... Comity persuades; but it does not command. It declares not how a case shall be decided but how it may with propriety be decided.
The statement, however, was made in a far different context, namely, the extent to which one federal court of appeals should feel itself bound by the decision of another with respect to the validity and scope of a patent. Both courts were governed by the same law and the statement was made in deprecating the appellant's claim that the second court of appeals had given insufficient weight to "comity". More enlightening for this case, although not dispositive, is this court's recent statement in NLRB v. St. Luke's Hospital,
Arrangements resulting from state agency proceedings should generally be respected if consistent with federal policies. "Comity" in this sense reflects the desirability of supporting settled relationships in the absence of compelling countervailing reasons. It is clear, however, that the NLRB is not required to defer to state proceedings where federal policy would be undermined.
We would strengthen the last sentence to say "is not required or permitted."
In this case, the Board, adopting the ALJ's findings, properly extended comity to the MERC elections conducted before the issuance of Management Training. Specifically, the Board, citing Standby One Associates,
There was also no apparent deviation from due process requirements. In particular, there was testimony that state-election procedures are as rigorous as the Board's. While MCS suggests that "[t]he State of Michigan's extensive involvement in the election process painted the proceedings with the authority of state government," MCS Br. at 20, there is no credible evidence that the elections did not accord with due process.
Moreover, the Board properly found that the MERC-conducted elections were consistent with the policies and procedures of the Act. As the Board points out, it has been its longstanding policy to recognize as binding the results of state-conducted elections "provided that the state proceedings reflect the true desires of the affected employees, election irregularities are not involved, and there has been no substantial deviation from due process requirements." Allegheny Gen. Hosp.,
There is no merit to MCS' claim that the MERC-conducted elections should be set aside based upon the alleged misrepresentation that MDMH was a joint employer in these proceedings. According to MCS, the alleged misrepresentation concerning MDMH's role affected the free and fair conduct of the elections. Specifically, MCS contends that the Board applied the wrong legal standard in evaluating the facts. In support of their claim of misrepresentation, MCS relies upon the five-factor test announced in Mitchellace, Inc. v. NLRB,
What is wrong with this line of attack is that there was no misrepresentation that supports setting aside the elections. Specifically, there was no evidence in the record that MCS' employees were misled by the status of MDMH at the time of the elections, even though MCS had every opportunity to present such evidence during these proceedings. At the time that MERC conducted the elections, it was the case that MDMH was considered to be a joint employer. However, as Intervenor AFSCME states, "everyone knew, or should have known, that the status of the state as employer under PERA was subject to vigorous litigation." AFSCME Br. at 22. Thus, contrary to MCS' unsupported assertion, there is no indication that the MERC-conducted elections at the time "denied employees a free and fair choice based upon the truth;" nor is there any basis to believe that "the complexity of the interrelationships between the State of Michigan Department of Mental Health, the state judiciary, the MERC, the Board, and the parties to the election robbed employees and Employers of a clear understanding as to the impact of the union elections." MCS Br. at 18. Because there was no misrepresentation concerning MDMH's status as a joint employer, there is no basis to set aside the elections.
Nevertheless, MCS' real complaint is whether the changed circumstance of MDMH not being at the bargaining table called into question whether the election results reflected the desires of their employees to be represented by the Unions. Thus, MCS claims:
Had employees known in the present case that the State of Michigan would ultimately not participate in collective bargaining, the result of the election could easily have been different. Without the misrepresentation regarding the state's involvement, employees could have weighed the extraction of union dues out of modest earnings against the improbability of the union securing higher wages or different working conditions.
MCS Br. at 22-23. According to MCS, the elections should be invalidated because "[i]t is doubtful that employees would have voted for a decrease in their wages to finance a union dues deduction, in light of the improbability of wage increases at the bargaining table." MCS Br. at 27.
Here, the Board reasonably rejected as speculative the claim of MCS that the contracts between MCS and MDMH legally preclude MCS and their employees from bargaining about improved wages, benefits, staffing levels and the like. Even though the contracts with MDMH set the wages, benefits and staffing levels for which MCS will be reimbursed during the contracts' annual term, these contracts do not prevent the employers from agreeing to increase such terms during collective bargaining with their employees. Thus, there is no credible evidence that MCS' employees would have rejected union representation had they known that MDMH would not be present at the bargaining table.
As the Board perceptively points out, the only real change in the employees' situation resulting from the Board's recognition of the MERC-conducted elections held before the issuance of Management Training is that MCS' employees are now authorized to strike. As the Board notes, the employees were prohibited from striking against an exempt governmental entity under PERA. However, under the Board's jurisdiction, the employees are permitted to strike, thus strengthening their ability to enforce their bargaining demands. Given that the employees were given authorization to strike, the Board correctly reasons that it is unlikely that the changed circumstance occasioned by the Board's jurisdiction of this matter would cause the employees to abandon union representation. Because it is not very likely that the absence of the MDMH at the bargaining table would have affected employee views and attitudes about union representation, there was no support for nullifying the elections upon the basis of a changed circumstance.
Consequently, MCS cannot repudiate its bargaining obligations. As the Board makes clear, the situation in this case is similar to one in a successorship context in which new owners cannot repudiate an existing bargaining obligation on the ground of changed circumstances. See Fall River Dyeing & Finishing Corp. v. NLRB,
Accordingly, we find that the Board did not err in extending comity to the MERC-conducted elections held before the issuance of Management Training. We thus deny MCS' petition for review.
Case No. 00-2451:AFSCME's Petition
On the other hand, contrary to AFSCME's claim, the Board did not err in declining to extend comity to the MERC-conducted elections after Management Training was decided on the basis that MERC lacked jurisdiction to hold these elections. In reviewing this claim, we note that the NLRB "has discretion whether to exercise jurisdiction." Pikeville,
In determining whether the Board had jurisdiction, this Court in Pikeville set forth the following standard: "Under a Management Training Corp. analysis, the jurisdiction of the NLRB over [an employer] is established simply by the minimal showing that the [employer] both "meets the definition of `employer' under Section 2(2) of the Act," and "meets the applicable monetary jurisdictional standards."" Id. Under this test, the Board properly had jurisdiction over SLS.
In this regard, there is no merit to AFSCME's claim that SLS waived the jurisdictional issue by failing to raise it before the MERC elections were held or before the Board in Summer's Living Systems, Inc. As the Intervenors SLS point out, their failure to contest the jurisdiction of the MERC at the time of the elections does not prevent the Board from concluding that the MERC lacked jurisdiction to conduct the elections after Management Training. As this Court noted in NLRB v. Ferraro's Bakery, Inc.:
The Board concedes that the question of its statutory jurisdiction may be raised at any time despite failure to raise this issue before the Board in a timely fashion. Failure to file exceptions does not confer jurisdiction on the Board if the order is beyond the scope of its statutory authority. As said in N.L.R.B. v. Cheney California Lumber Company,
"Since the court is ordering entry of a decree, it need not render such a decree if the Board has patently traveled outside the orbit of its authority so that there is, legally speaking, no order to enforce."
It is elementary that: "Want of jurisdiction of the subject matter cannot be waived; that jurisdiction of the subject matter cannot be supplied by the consent of the parties; and that objection to lack of such jurisdiction may be interposed or noticed at any stage of the action." 1A Barron and Holtzoff, Fed. Practice and Procedure, § 370b (Wright ed., 1960).
In this case, the Board, after issuing Management Training, had exclusive jurisdiction to direct or supervise the elections. See Sears, Roebuck & Co. v. Carpenter's Dist. Council (San Diego),
Because MERC did not have jurisdiction to conduct the elections involving SLS after the issuance of Management Training, the Board properly refused to extend comity to these MERC-conducted elections. As pointed out by SLS, extending comity in this case would directly violate the intent of Congress to vest exclusive jurisdiction with the Board and subvert the goal announced in New York Telephone Co. v. New York State Dept. of Labor,
The overriding interest in a uniform, nationwide interpretation of the federal statute by the centralized expert agency created by Congress not only demands that the NLRB's primary jurisdiction be protected, it also forecloses overlapping state enforcement of the prohibitions in § 8 of the Act [29 U.S.C. § 158] ... as well as state interference with the exercise of rights protected by § 7 of the Act [29 U.S.C. § 157].
Id. at 528,
CONCLUSION
For the foregoing reasons, we DENY the petitions for review by MCS in Case No. 00-2192 and AFSCME in Case No. 00-2451, and ENFORCE the Board's order in Case No. 00-2440 finding that it is supported by substantial evidence on the record.
Notes:
Notes
AFSCME won all the elections, except for one that was won by the UAW
After the decision inAFSCME v. Mental Health Dep't,
In this case, there are thirty-eight group home providers and forty units at issue. Two providers, Alternative Services and Carson's AFC, held elections both before and after July 28, 1995, thus accounting for the difference between the number of providers and subject units
The ALJ's decision is attached toSummer's Living Systems. See
Except for one instance, all the unfair labor practices involved the AFSCME
Section 152(2) provides:
(2) The term "employer" includes any person acting as an agent of an employer, directly or indirectly, but shall not include the United States or any wholly owned Government corporation, or any Federal Reserve Bank, or any State or political subdivision thereof, or any person subject to the Railway Labor Act [45 U.S.C.A. § 151 et seq.], as amended from time to time, or any labor organization (other than when acting as an employer), or anyone acting in the capacity of officer or agent of such labor organization.
29 U.S.C. § 152(2) (emphasis added). See Pikeville United Methodist Hosp. v. USW,
As pointed out inManagement Training: "Sec. 2(2) excludes from the term `employer' both Federal and state governmental entities as well as `political subdivisions thereof.'"