Plаintiff Mulvaney Mechanical, Inc. (Mulvaney, employer, or company) brought suit to vacate an arbitration award
On this appeal we deal with the issue of whether a breach by a union of a no-strike clause in a collective bargaining agreement repudiated that agreement and thereby justified the employer in rescinding the entire agreement. The doctrine in contract law that a material breach by one party to a contract constitutes such a repudiation as to justify the other party’s unilateral rescission of the entire contract is not a legal concept that readily is transposed into the context of national labor law — as though the notion “one size fits all” applies in the law. On the contrary, in labor law there are other policies to consider, in particular the strong presumption in favor of arbitrability, which in this case preclude giving the employer the right to terminate the collective bargaining agreement solely on account of the union’s breach.
BACKGROUND
Up until 1997 Mulvaney, a Connecticut-based sheet metal contractor, was a member of a multi-employer bargaining group, the Associated Sheet Metal and Roofing Contractors of Connecticut, Inc. (Association). The Association secured workers for its member-employers by contracting with appellant, Local 38. The collective bargaining agreement between the Association and Local 38 was for a term of one year, but was automatically renewed on an annual basis unless a party requested that it be reopened. Article XIV of the agreement provides that if a party should elect to reopen the agreement at the end of the yearly term, the agreement should nevertheless remain in effect until the conclusion of “interest arbitration” before the National Joint Adjustment Board (National Adjustment Board or Board), an arbitration board comprised equally of employer and union members. “Interest arbitration” involves referring a dispute to an arbitration panel in order for it to establish the terms and conditions of a future collective bargaining agreement. It differs from the more typical grievance arbitration, which involves interpreting an existing employment contract to determine whether its conditions have been breached.
See Chicago Typographical Union No. 16 v. Chicago Newspaper Publishers’ Ass’n,
Article X, Section 8 of the agreement delineates the interest arbitration procedures to be followed upon the failure of the parties to negotiate the renewal of the existing contract. That section also prohibits the parties from engaging in a work stoppage, unless and until the National Adjustment Board formally notifies the parties that it was unable to reach a unanimous compromise decision:
[A]ny controversy or dispute arising out of the failure of the parties to negotiatea renewal of this Agreement shall be settled as hereinafter provided:
The dispute shall be submitted to the National Joint Adjustment Board pursuant to the rules as established and modified from time to timе by the National Joint Adjustment Board. The unanimous decision of said Board shall be final and binding upon the parties.... There shall be no cessation of work by strike or lockout unless and until said Board fails to reach a unanimous decision and the parties have received a written notification of its failure.
The Strike by Local 38
By letter of January 8, 1997 Local 38 informed the Association that the agreement between them was due to expire six months later on June 30, 1997 and that the union had elected to terminate its bargaining relationship with the multi-employer Association as of that date. This letter satisfied the requirement of § 8(d)(1) of the National Labor Relations Act (NLRA), 29 U.S.C. § 158(d)(1) (1994), that required Local 38 to give Mulvaney at least 60 days advance notice of its intention to modify or terminate the agreement. The union planned thereafter to negotiаte exclusively with the Association’s individual member employers. As required by § 8(d)(3) of the NLRA, 29 U.S.C. § 158(d)(3), Local 38 sent a “Notice to Mediation Agencies” on January 21, 1997, apprising both the Federal Mediation and Conciliation Service and the New York State Employment Relations Board of its intention to terminate the collective bargaining agreement. Unfortunately, the union’s notice identified the Association as the relevant party to the dispute rather than the individual employer, even though both parties had agreed to negotiate on an individual basis. In addition, the union failed to notify in a timely fashion the Connecticut Board of Mediation and Arbitration, which it was required to do since the Board qualified under the NLRA as a “State ... agency established to mediate and conciliate disputes within the State ... where the dispute оccurred.” Id.
Local 38 thereafter met with individual employers regarding the terms of a new collective bargaining agreement. It negotiated unsuccessfully with Mulvaney be^ tween May and June 1997. On June 19, 1997 the union informed Mulvaney that the employer’s latest proposal was unacceptable, that the employees’ position was “No Contract, No Work,” and that Mulvaney would be subject to a work stoppage if the parties did not reach an accord prior to the June 30th expiration of the agreement. The Association, responding for its member employers, reminded Local 38 of the interest arbitration provision of the agreement and of the union’s obligation not to strike until the National Adjustment Board deadlocked following a petition by the parties.
On June 25, 1997 Local 38 informed its members that the negotiations with the employers had failed and that a strike was authorized for July 1, 1997, one day after the expiration of the agreement. On July 1,1997 members of Local 38 struck several sheet metal contractors, including Mulva-ney, where six union members failed to report for work.
Related Proceedings Follomng the Work Stoppage
Although Local 38 and Mulvaney continued to negotiate the conditions of a renewal agreement during the work stoppage, Mulvaney hired nine workers to replace its striking employees and allegedly ceased to honor the terms of the expired agreement. On July 2, 1997 the Association brought suit in the United States District Court for
We terminated [the collective bargaining] agreement under its terms, and under the terms of article 14 even, it says that ... if there’s an article 10 section 8 provision in the contract, which there was, it would go to the [National Adjustment Board], which is the normal course of events.
But not in this case, because there are no negotiations for a renewal agreement, so article 10 section 8 does not apply. What does apply is the termination notice which we gave in January, and this contract ended two days ago, or .three days ago.
Local 38 took a similar position when it filed a petition for election with the National Lаbor Relations Board (NLRB) on October 30, 1997. Until the petition, Mulvaney’s employees had maintained their relationship with Local 38 under § 8(f) of the NLRA, 29 U.S.C. § 158(f) (1994). That section provides that only in the building and construction industry may an employer enter into a collective bargaining agreement with a union even though the union has not been elected as a bargaining unit by a majority of the employer’s workers.
See id.
At the conclusion of the term of the agreement, both the employer and the union can unilaterally repudiate the § 8(f) bargaining relationship.
See John Deklewa & Sons,
After the union’s represеntation election, a hearing was held on January 29, 1998 before an NLRB hearing officer regarding Mulvaney’s claim that 16 workers were ineligible to vote in the election because they had lost their status as “employees” following the strike. See id. § 158(d). At the hearing Local 38 took the position that the agreement with Mulvaney had expired on June 30, 1997, and accordingly that the workers did not lose their employee status under § 8(d) of the NLRA. See id.
On April 24, 1998 the hearing officer issued a report which found that the agreement was still in effect at the time of the strike, that Local 38 failed to fulfill the notice requirements of § 8(d)(3) of the NLRA and, as a result, five of Mulvaney’s striking workers were ineligible to vote in the representation election. The hearing officer further found that Mulvaney had failed to prove that 11 other workers had participated in the strike and thus held that the challenged ballots of these workers should be added to the election’s vote tally.
On October 14, 1998 the NLRB ruled that Local 38 had received a majority of the ballots cast in the representation election and certified that union as the exclusive collective bargaining representative of Mulvaney’s employees. Mulvaney has since refused to bargain with Local 38— purportedly in an attempt to challenge the NLRB’s certification — but in a May 6, 1999 decision, the NLRB found that Mul-vaney’s failure to recognize the union constituted an unfair labor practice.
Mulva-
The distinct issue on this appеal is whether Mulvaney is bound by the terms of an existing labor agreement to execute the specific collective bargaining agreement that the National Adjustment Board has awarded in arbitration.
The Present Dispute
Despite the previous representations that the agreement had expired, Local 38 on November 25,1997 invoked the interest arbitration provision, Article X, § 8, to request that the National Adjustment Board assume jurisdiction over negotiations between the union and Mulvaney. The employer objected to arbitration arguing that Local 38 had terminated the agreement— including the interest arbitration provision — by its July 1, 1997 strike. The employer appeared at the National Adjustment Board’s hearings solely to challenge jurisdiction. The Board nevertheless assumed jurisdiction, and on July 1, 1998 directed the parties to execute a 46 month collective bargaining agreement, effective immediately, incorporating the same terms as Local 38’s “budding trades” collective bargaining agreement.
On July 30, 1998 Mulvaney filed an action in Connecticut state court to vacate the arbitration award, primarily on the ground that the Board acted without jurisdiction. Local 38 removed this action to the United States District Court for the District of Connecticut (Chatigny, J.), basing federal question jurisdiction on § 301(a) of the Labor Management Relations Act, 29 U.S.C. § 185(a) (1994). In July 1999 the parties cross-moved for summary judgment, with the employer seeking to vacate the arbitration award and Local 38 seeking to enforce the award.
In a March 31, 2000 order the district court vacated the Board’s award as extra-jurisdictional. It held that Local 38’s strike constituted a repudiation of the agreement and that Mulvaney was thereby entitled to rescind the contract, including the interest arbitration provision.
See Mulvaney Mech., Inc. v. Sheet Metal Workers Int’l Ass’n, Local 38,
No. 3:98CV1750 RNC,
DISCUSSION
We review the district court’s grant of summary judgment
de novo. Morales v. Quintel Entm’t, Inc.,
Local 38 contends on appeal that the district court’s grant of summary judgment vacating the arbitration award was error. Mulvaney counters that summary judgment was appropriate because the Board actеd extra-jurisdictionally. Specifically, Mulvaney contends that the Board derived its authority solely from the interest arbitration provision of the agreement, and that either of two alternative grounds
Initially, the company asserts the strike by the union — in violation of the no-strike clause of the collective bargaining agreement and in contravention of § 8(d) of the NLRA — ipso facto terminated the agreement. In the alternative, the employer insists the strike, coupled with the union’s later pronouncements that the collective bargaining agreement had been terminated, constituted a repudiation of the agreement. This repudiation, Mulva-ney’s argument concludes, gave it the option of rescinding the agreement, an oрtion that it exercised.
I The Strike Did Not Ipso Facto Terminate the Agreement
Under the terms of the interest arbitration provision of the agreement, the parties are prohibited from resorting to a work stoppage upon the expiration of the collective bargaining agreement, unless and until formal notification by the Board that it has failed to reach a unanimous decision. Local 38 admits that it failed to comply with the mandates of this no-strike provision. Moreover, we recognize that the strike contravened § 8(d)(3) of the NLRA, 29 U.S.C. § 158(d)(3), because the union failed, for example, to provide timely notification to the Connecticut Board of Mediation and Arbitration prior to engaging in the work stoppage. Mulvaney alleges that these two transgressions by the union — the strike and the failure to give notice ahead of time to the appropriate mediation agencies-operated in tandem to terminate the agreement ipso facto when the strike began.
A. Notice Requirements
Section 158(d) of the NLRA states in pertinent part
[T]he duty to bargain collectively shall also mean that no party to [a collective bargaining agreement] shall terminate or modify such contract, unless the party desiring such termination or modification—
(3) notifies the Federal Mediation and Conciliation Service within thirty days after such notice of the existence of a dispute, and simultaneously therewith notifies any State or Territorial agency established to mediate and conciliate disputes within the State or Territory where the dispute occurred, provided no agreement has been reached by that time.
29 U.S.C. § 158(d). The section further provides that “[a]ny employee who engages in a strike within any notice period specified in this subsection ... shall losе his status as an employee of the employer engaged in the particular labor dispute, ... but such loss of status for such employee shall terminate if and when he is reemployed by such employer.” Id.
The employer maintains that Local 38’s failure to notify the proper mediation authorities in a timely manner and to abstain from a work stoppage for a 60 day period from the date of notification, see § 158(d)(4), resulted in the loss of employee status for the striking workers under § 158(d). Since all of the union members employed by Mulvaney struck the employer — and in turn allegedly lost their employee status — the employer avers that Local 38’s support of the strike resulted in the forfeiture of its status as the union representative of Mulvaney’s employees. The company further declares that this loss of bargaining agent status led to the termination of the collective bargaining agreement because one of the parties to that agreement, i.e., Local 38, had “judicially ‘died.’ ”
Importantly, contrary to the above assumption, it is entirely conceivable that Mulvaney’s bargaining relationship with Local 38 as the majority representative would continue even if all of the company’s union employees were discharged. In the context of a dispute over whether a union maintained the majority of support of a unit of employees, the Supreme Court has upheld the NLRB’s “no-presumption approach” to strike replacement workers.
NLRB v. Curtin Matheson Scientific, Inc.,
Mulvaney hired nine replacement workers during the course of Local 38’s strike. A holding that the loss of employee status of the striking union workers terminated the collective bargaining agreement would
Finally, even if the strike had dissolved the bargaining relationship between Mulvaney and Local 38, we are not persuaded that the collective bargaining agreement was terminated automatically. It is settled that when a union which is a party to an existing collective bargaining agreement is decertified, the successor union is not necessarily bound by the terms of the unexpired labor contract.
See NLRB v. Burns Int’l Sec. Servs., Inc.,
In Abrams, we expressed disapproval of the lower court’s reliance on the NLRB’s decision in American Seating for the proposition that the certification of a successor union automatically terminated a pre-exist-ing collective bargaining agreement. As we held in Abrams
American Seating simply held that it was an unfair labor practice for an employer to refuse to bargain with a newly certified union upon the ground that it was bound by a prior contract with a former bargaining representative. It does not follow from this reasoning that until a new agreement is reached with a new bargaining representative, the old agreement, or at least those portions thereof necessary for the continuation of the employer-employee relationship, automatically ceased to exist....
Id. Because we are not convinced that the alleged cessation of the bargaining relationship between Mulvaney and Local 38 would have automatically terminated the agreement — rather than simply render the contract voidable — we reject the employer’s argument in support of ipso facto termination.
B. Strike in Violation of the No Strike Clause
The company’s second argument that the union’s strike in violation of the agreement’s no-strike clause, Article 10, § 8, terminated the agreement also fails to carry the day. In
Drake Bakeries, Inc. v. Local 50, American Bakery & Confectionery Workers International,
In
Local Union No. 721, United Packinghouse, Food and Allied Workers v. Needham Packing Co.,
II The District Court Acted Beyond Its Authority
Drake Bakeries
left open the possibility that a strike by a union in contravention of the no-strike clause of an agreement might constitute such a repudiation of the arbitration provision that the employer would be justified in rescinding the entire agreement.
See
The trial court found further support for its holding in
United Electrical, Radio and Machine Workers of America, Local 1113 v. NLRB,
Nonetheless, the authorities are divided regarding the wisdom of applying traditional contract principles to disputes concerning an alleged termination of a collective bargaining agreement.
Compare Children’s Rehab. Ctr. v. Serv. Employees Int’l Union, Local No. 227,
A. Repudiation by the Union’s Strike
We need not decide today to what extent traditional contract principles of repudiation and rescission apply in the labor context, for we think the district court acted beyond its authority in applying those principles in this case. In
Rochdale Village, Inc. v. Public Service Employees Union, Local No. 80,
Rochdale Village
involved a grievance arbitration clause rather than the present interest arbitration clause,
see Rochdale Vill.,
The Seventh Circuit, in a case particularly apposite, held that a claim by an employer that it had repudiated an agreement was subject to the interest arbitration provision contained in that agreement.
See Sheet Metal Workers Local Union No. 20 v. Baylor Heating & Air Conditioning, Inc.,
The parties agreed to arbitrate “any controversy or dispute arising out of thefailure of the parties to negotiate a renewal of this Agreement.” The Company then unilaterally repudiated the agreement and refused to negotiate a renewal. The Company’s actions come within the scope of the broad arbitration clause that “clearly and unmistakably” evidences the parties’ intent to arbitrate.
Id.
We adopt that rule and hold that when, as here, there is a broadly worded interest arbitration clause, the question of whether an agreement has been repudiated is to be determined by the arbitrator.
Cf. Rochdale Vill.,
B. Repudiation During Proceedings
Throughout its appellate brief, Mulvaney intimates that even if the strike by Local 38 did not serve to repudiate the agreement, the union forfeited its right to arbitrate by representing both before the NLRB and in federal district court that the contract had been terminated. The contention that Local 38’s conduct during related administrative and judicial proceedings constituted a repudiation of the union’s right to arbitration is also a matter subject to arbitration.
Cf. Flair Builders,
A number of circuits have fashioned an exception to the general rule that decisions regarding repudiation are for the arbitrator. These courts have reasoned that where the alleged repudiation or, as some phrase it “waiver,”
1
occurred in the midst of proceedings directly before the district court itself, the court need not defer to the arbitrators.
See Reid Burton Constr., Inc. v. Carpenters Dist. Council,
These cases are inapposite to the facts in the present case. While the union vacillated regarding the status of the collective bargaining agreement following the strike, its position has remained constant in the instant dispute. Hence, while Local 38 asserted the agreement was terminated both when the Association brought suit before Judge Covello in district court to enjoin the strike, and when it sought certification as the official bargaining representative for the employees bеfore an NLRB hearing officer, in the present matter be
The prerogative of federal courts to assume jurisdiction when the alleged repudiation occurred in their presence is premised on the view that “[mjaintenance of control and supervision over court proceedings is an inherent judicial function that surely includes the power to determine the validity of equitable defenses arising from the parties’ conduct before the court.”
California Trucking,
Nor do we believe that it would have been appropriate for the district court to have invoked the discretionary doctrine of judicial estoppel. This doctrine precludes a party that successfully maintained a particular position in one legal proceeding, from assuming a contrary position in a later proceeding solely because of a change in interest.
New Hampshire v. Maine,
Local 38’s vacillations regarding the status of the agreement do not satisfy our judicial estoppel standard. We have held that a party requesting judicial estoppel must demonstrate both that (1) the party against whom estoppel is sought has pursued an inconsistent factual position in an earlier proceeding, and (2) this prior inconsistent position was somehow adopted by the first court.
United States v. Hussein,
Local 38 has wavered concerning the practical ramifications of the union’s strike upon the collective bargaining agreement, but such legal conclusions are not “inconsistent factual positions” as would ordinarily justify judicial estoppel. There is no indication that either Judge Covello, when deciding upon the Association’s suit to enjoin the strike, or the NLRB, when reviewing the union’s election proceedings, adopted Local 38’s position that the agreement had already been terminated. Judicial estoppel is inappropriate without a showing that the prior tribunal adoptеd the original representations.
See Bates v. Long Island R.R. Co.,
Ill Self Perpetuation of Interest Arbitration Clause
The Board’s arbitration award directed the company to execute a new 46-month collective bargaining agreement, with this agreement also to contain an interest arbitration clause. Although the district court erred in refusing to confirm the arbitration award, it is directed on remand to vacate the Board’s inclusion of a second interest arbitration clause.
An interest arbitration clause is void as cоntrary to public policy to the extent that it applies to nonmandatory subjects of bargaining,
ie.,
subjects other than wages, hours and other terms and conditions of employment; this includes the insertion of a successor interest arbitration clause in a new agreement.
See NLRB v. Sheet Metal Workers Int’l Ass’n, Local Union No. 38,
Since interest arbitration clauses are enforceable only with respect to those disputed contract terms that are mandatory subjects of bargaining,
Elmsford,
Both the parties’ оriginal agreement and the new agreement to be executed pursuant to the Board’s award, contain a sever-ability clause, providing that “[i]f, pursuant to federal or state law, any provision of the Agreement shall be found by a court of competent jurisdiction to be void or unenforceable, all of the other provisions of this Agreement shall remain in full force and effect.” Because the nonmandatory terms of the Board’s award have not been shown to be so fundamental that their absence would nullify the agreement as a whole,
see Sheet Metal Workers’ Int’l Ass’n, Local 206 v. R.K. Burner Sheet Metal Inc.,
CONCLUSION
For the reasons explained above, we vacate the judgment appealed from and remand the case to the district court for the entry of judgment confirming the mandatory terms of the National Adjustment Board’s arbitration award and vacating that portion of the award that includes nonmandatory terms.
Notes
. We have also used the concept of "waiver,” which while somewhat similar to repudiation has distinct requirements of its own.
See, e.g., Leadertex, Inc. v. Morganton Dyeing & Finishing Corp.,
