By Dave Strausfeld, J.D.
A company that quarried stone did not commit an unfair labor practice when it decided to transfer from one bargaining unit to another the work of hauling stone and other materials to construction sites, held the D.C. Circuit, granting a petition for review and denying the NLRB’s cross-petition for enforcement in relevant part. The company’s action was best classified as a transfer of work, which meant the company could implement its proposal unilaterally if the parties reached a bargaining impasse, as they did here. The Board erred when, focusing on the fact that several dozen drivers were ultimately moved to a bargaining unit where they were paid significantly less, it ruled that the company had impermissibly changed the scope of the bargaining unit (Aggregate Industries v. NLRB
, June 10, 2016, Randolph, R.).
Company transferred work to lower-wage unit.
Until the events underlying this case, only drivers who were members of the so-called construction bargaining unit made deliveries of the quarry’s aggregate (crushed stone and related materials) to construction sites. These drivers were paid over $5 per hour more than drivers who belonged to the Ready-Mix bargaining unit, who hauled loads between batch plants. Both sets of employees were represented by the same union.
In July 2010, the company announced that it was going to move trucks from the construction side of the business to the Ready-Mix division and use those trucks to make deliveries to construction sites. The company also wanted to employ the same individual drivers, paying them at the lower wage rates of the Ready-Mix CBA. The union objected, filed an unfair labor practice charge, and also picketed for several days. In October, the parties agreed to an interim arrangement under which the drivers would continue to do the same work, using the same trucks, and hauling the same material to and from the same locations as they did previously, though they were no longer covered by the construction bargaining unit CBA and would be paid less on a gradually phased-in basis.
The key question in this case was whether the company transferred work
or changed the scope of the bargaining unit
. Transferring work would be a mandatory subject of bargaining, and if negotiations reached an impasse, the company could make the change unilaterally. In contrast, if the company’s action was considered to be changing the scope of the bargaining unit, this would be a permissive subject of bargaining, which meant that if the union refused to negotiate, the company would have no choice but to maintain the status quo.
In its decision below, the NLRB found that the company had changed the scope of the bargaining units, which it could not lawfully do without first reaching an agreement with the union. The D.C. Circuit reversed.
Problems with Board’s reasoning.
According to the Board, because the company had previously assigned work to one bargaining unit’s drivers, the transfer of that work necessarily changed the scope of the bargaining unit, and the company could not make the change without the union’s consent. "That cannot be right," the appeals court declared. "If an employer had to obtain the union’s consent every time it removed a work assignment from the unit where it ‘has been included,’ then every work transfer would require union consent."
Best characterized as work transfer.
Instead, the company’s proposal was "best classified as a transfer of work." The Board reached the opposite conclusion only by combining the company’s work transfer proposal with a separate proposal to use the same drivers. But the parties treated the two proposals as distinct, "and we do so as well," the appeals court wrote. "Considered in isolation, moving material hauling from one agreement to the other did not implicate the scope of either bargaining unit, because the scope of those units did not depend on doing any particular work."
This was not a case, the court underscored, where the bargaining unit was defined in terms of the work the employees performed. That would have made it more difficult to distinguish between work transfers and bargaining unit changes. Rather, the bargaining units here were defined in terms of "job classifications," and none of those job classifications unambiguously covered material hauling work.
No unfair labor practice.
Because a work transfer is a mandatory subject of bargaining, the union was obligated to bargain with the company about its proposal. While the company made overtures to the union, offering to discuss the plan to transfer material hauling work, the union "doggedly maintained" its position that it could not agree to the plan. "By stonewalling the company" in this way, the union waived its opportunity to bargain. At the very least, the two sides quickly reached an impasse, so the company had a right to implement its plan unilaterally.
And because the company had the right to unilaterally transfer material hauling work, the union acted improperly when it refused to fill the company’s dispatch order. Under the Ready-Mix CBA, the company therefore had the right to hire anyone it wanted, including its own drivers.