NOTICE: This
opinion is subject to formal revision before publication in the bound volumes
of NLRB decisions. Readers are requested
to notify the Executive Secretary, National Labor Relations Board,
Cheney Construction, Inc. and United Brotherhood of Carpenters and Joiners of
March 22, 2007
SUPPLEMENTAL DECISION AND ORDER
By Members Schaumber, Kirsanow, and Walsh
On
The National Labor Relations Board has delegated its authority in this proceeding to a three-member panel.
The Board has considered the decision and the record in light of the exceptions and briefs and has decided to affirm the judge’s rulings, findings, and conclusions and to adopt the recommended Order.2
ORDER
The National Labor Relations Board adopts the recommended Order of the administrative law judge and orders that the Respondent, Cheney Construction, Inc., Manhattan, Kansas, its officers, agents, successors, and assigns, shall satisfy the obligation to make whole the employees named below by paying them the amounts set forth below, with interest to be computed in the manner described in New Horizons for the Retarded, 283 NLRB 1173 (1987), minus tax withholdings required by Federal and State laws.
Randy Mumpower $17,707.91
David Randy Johns 19,899.78
Kenneth Fairchild 9,358.85
TOTAL $46,966.54
Dated,
Peter
C. Schaumber,
Member
Peter
N. Kirsanow, Member
Dennis P. Walsh, Member
(seal) National Labor Relations Board
Stanley D. Williams, Esq. of for the General Counsel.
Robert C. Johnson, Esq. and R. Anthony Costello, Esq. of
Michael J. Stapp, Esq. of
SUPPLEMENTAL DECISION
Statement of the Case
Thomas M. Patton, Administrative Law Judge. On February 4, 2005, the Board issued its Order adopting the findings and conclusions of Administrative Law Judge Albert A. Metz in the underlying case, Cheney Construction, 344 NLRB No. 9 (2005). Judge Metz found that Respondent had discriminated against employees Randy Mumpower, David Randy Johns, and Kenneth Fairchild by refusing to consider them for hire and refusing to hire them on August 27, 2003, because of their union affiliation. Judge Metz’ order, adopted by the Board, requires that the discriminatees be a made whole.
An issue in this compliance proceeding is how long employee-applicants Mumpower, Johns, and Fairchild would have remained employees of Respondent had they not been discriminated against. That issue is controlled by the Board’s rebuttable presumption of continuing employment in the construction industry, as set forth in Dean General Contractors, 285 NLRB 573 (1987); see also Cobb Mechanical Contractors v. NLRB, 295 F.3d 1370, 1379 (D.C. Cir. 2002), citing Tualatin Electric v. NLRB, 253 F.3d 714, 718 (D.C. Cir. 2001).
A compliance specification issued on September 30, 2005.
Relying on the presumption of continued employment, the specification
calculated gross backpay from the application date of the three discriminatees.
The specification calculated gross backpay based upon comparable employees for
a period ending just before letters offering instatement were issued to the discriminatees
on July 11, 2005.
Respondent’s answer avers that the compliance specification is unreliable and should be rejected as the basis of calculating backpay. Respondent argues that, contrary to the compliance specification, the discriminatees would not have been transferred or reassigned to another job after the completion of the job for which they were denied employment. Respondent also alleges that discriminatees Mumpower and Johns failed to mitigate their damages. Finally, Respondent posits that willing retention of known union workers after the discriminatees were not hired offsets any backpay owed to the discriminatees.
Rejecting the Respondent’s arguments, I find that Respondent
failed to rebut the presumption of continued employment of Mumpower, Johns, and
Fairchild and that the Regional Director adopted a reasonable gross backpay
formula to determine an appropriate amount of net backpay owed to the discriminatees. I
also find that the efforts of Mumpower and Johns to mitigate their damages
during the period covered by the compliance specification were sufficient. Finally, I find the argument that the
subsequent employment of union workers should offset the backpay owed to the
discriminatees is untenable.
This case was heard in
Findings of Fact
i. issues
1. Was the Regional Director correct in presuming that the discriminatees would have been retained as employees from August 27, 2003, to July 11, 2005, for the purposes of calculating backpay?
2. Was the Regional Director’s method of calculating backpay reasonable given the circumstances of this case?
3. Did the discriminatees sufficiently mitigate their damages by making reasonable efforts to secure and retain interim employment?
4. Does the retention of carpenters who were discovered to hold Union membership after being hired subsequent to the discriminatory activity of the Respondent offset any back paid owed to the discriminatees?
ii. facts
A. Methodology Used by the Regional Director
The Board summarized the general purpose of compliance proceedings in Cobb Mechanical Contractors, 333 NLRB 1168, 1168 (2001) (Cobb I), as follows:
In compliance proceedings, the Board attempts to
reconstruct, “as nearly as possible,” the economic life of each claimant and
place him in the same financial position he would have enjoyed “but for the illegal
discrimination.” Phelps Dodge Corp. v.
NLRB, 313
The compliance specification
calculations are based on a “Comparable Employee Formula” which is an accepted methodology to
determine backpay. Performance Friction Corp. 335 NLRB 1117, 1117 (2001), citing NLRB v. S.E. Nichols of Ohio, 704 F.2d
921, 924 (6th Cir.), cert. denied 464 U.S. 914 (1983); NLRB
Casehandling Manual (Part Three) Compliance, Section 10532.3. The compliance specification identifies the
relevant pay period as beginning on August 27, 2003, the date of the
discriminatees’ applications for employment, and ending on July 11, 2005, the
date of Respondent’s instatement letters.
The
comparators identified in the compliance specification were employees either
hired or rehired after August 27, 2003, but before July 11, 2005.
Carpenters Gnadt, Driscoll, and Gallaugher were the first three new employees classified as carpenters hired within 2 months of August 27, 2003. Employee Gnadt was retained from September 3, 2003 to February 13, 2004, when he voluntarily resigned. Employee Driscoll was retained from September 10 to October 22, 2003, when he was discharged after two consecutive no-shows. Employee Gallaugher was retained from October 9, 2003 to January 20, 2004, when he was laid off. Judge Metz found that while Cheney employed them, both Gnadt and Driscoll were transferred to another job after the project for which they were hired was completed. Cheney Construction, 344 NLRB No. 9, slip op. at 6. Another new carpenter, Earnest, was hired in August 4, 2004, and was retained until June 2005.
All other carpenters hired between August 27, 2003 and July 11, 2005 and used as comparators in the compliance specification were rehires; employees who removed themselves from previous employment with Respondent for whatever reason and then were rehired within the backpay period at issue.
The Compliance Specification details how net backpay was calculated for discriminatees Mumpower, Johns, and Fairchild, computed on a calendar quarter basis. Gross backpay for discriminatee Mumpower was based on the comparable earnings of employees Gnadt, Hartenberger, and Brown. Subtracting Mumpower’s interim earnings, Mumpower’s net backpay was determined to be $17,705.91. Gross backpay for discriminate Johns was based on the comparable earnings of employees Driscoll, Gallaugher, Salser, and Earnest. Subtracting John’s interim earnings, John’s net backpay was determined to be $19,899.78 (after stipulating to $228.80 of additional interim income during the compliance proceeding). Gross backpay for discriminate Fairchild was based on the comparable earnings of employee Clark, an employee classified as a laborer, but found by Judge Metz to have also performed carpentry work. He was classified for insurance purposes as a carpentry employee. Subtracting Fairchild’s interim earnings and expenses, Fairchild’s net backpay was determined to be $9,358.85.
B. Mitigation of Damages
Discriminatees Mumpower, Johns, and Fairchild all reported interim earnings for the period between August 27, 2003 and July 11, 2005. All testified to using the union hiring hall when they were not employed. Between jobs, each of them collected unemployment insurance.
Discriminatee Mumpower worked for at least two contracting companies in the last quarter of 2003. He worked four different jobs throughout 2004, including one that lasted until October 2005. In addition to the hiring hall, Mumpower testified to acquiring work in 2003 by personally visiting a construction site.
Discriminatee Johns held jobs from December 2003 to April 2004, from June 2004 to January 2005, and from April to October 2005. Johns relied exclusively on the union’s hiring hall from April to June 2004. When not employed in 2005, Johns inquired of former employers about job openings in addition to having his name on the hiring hall list.
Discriminatee Fairchild worked for three employers in
2003, including the Carpenters District Council of Kansas City. In 2004, Fairchild held two jobs between
January and April, worked a third job in May, and worked two more between September
and December 2004. In 2005, he worked
for two employers between February and May.
When out of work, Fairchild registered at union hiring halls in
C. Retention of Union Carpenters
New-hires Driscoll and Gnadt, comparators used by both the Compliance Specification and the Respondent, were union carpenters whose union affiliation only became known to Respondent after they were hired in early September 2003. Driscoll was willingly retained until he was fired for cause. Gnadt was willingly retained until he voluntarily resigned.
iii. further findings and conclusions
In the underlying case, Judge Metz found that the discriminatees were due a traditional make-whole remedy of instatement and backpay based on what the discriminatees would have earned had they not been discriminated against by the employer. I find the Regional Director’s proposed remedy as detailed in the Compliance Specification to be appropriate.
A. The Presumption of Continued Employment
Given the particular context of construction industry cases, it is an important remedial consideration in these kinds of disputes whether employees would have been terminated upon the completion of a particular project or whether the employer’s practice was to transfer or reassign its workers from project to project.
Before Dean, the Board sometimes applied a “precompliance presumption against reinstatement in the construction industry.” Dean, 285 NLRB at 574. This was due to the fact that many construction workers are hired by contractors for jobs of limited duration without any guarantee of employment from one job to the next.
In Dean, the
Board overruled the presumption that a Respondent would have terminated an
unlawfully discharged employee upon completion of a project.
In time, this became a rebuttable presumption of continued
employment of wrongfully terminated employees in construction industry cases. Tualatin Electric, 253 F.3d at
718. Given that the same policy considerations
and principles are just as relevant in salting cases, such as the one at issue,
the Dean presumption has been found
to have “as much force in cases involving union salts as any other.” Tualatin
Electric, 253 F3d at 718. An
employer may rebut the presumption of continued employment by demonstrating
that under its “established policies,” an employee would likely not have been
transferred upon completion of a job.
Respondent argues that the comparators used in the Compliance Specification are inappropriate and that the discriminatees, had they been hired, would not have remained employees up until the time that instatement was ordered. The basis of Respondent’s argument is the decrease in carpenters it employed from 15 in late 2003 to 4 in mid-July 2005.
Respondent answered the Regional Director’s Compliance Specification with its own, alternative calculations. Respondent’s calculations are based on a similar comparable employee formula; however, they draw from a far narrower pool of comparators. Contrary to the number of workers used as comparators in the Compliance Specification, Respondent posits that the only appropriate comparators were employees Gnadt, Driscoll, and Gallaugher, the first three new carpenters hired after August 27, 2003. Respondent contends that re-hires should not be included as comparators in calculating the gross backpay for the discriminatees, and that carpenter work was unavailable after January, 2004. I disagree.
It would be arbitrary to limit comparators for the purpose of determining backpay to the first three hires made within a specific classification. In Cobb Mechanical Contractors, 341 NLRB No. 136, slip op. at 6 (2006), (Cobb II), the Board adopted an order that rejected the reasoning, absent further evidence to the contrary, that a discriminatee would have “followed the same employment patterns as the new hires.” The fact that this is such a questionable assumption leans in favor of the discriminatees. Minette Mills, Inc., 316 NLRB 1009, 1011 (1995) ("any ambiguities, doubts, or uncertainties are resolved against ... the wrongdoer, because an offending respondent is not allowed to profit from any uncertainty caused by its discrimination"); see also Cobb I, 333 NLRB at 1168; P*I*E* Nationwide, 297 NLRB 454, 457 (1989), enfd in relevant part 923 F.2d 506 (7th Cir. 1991). Given the evidence presented, there is simply no reason to believe that the discriminatees’ hypothetical employment with the Respondent would have ended when Gnadt, Driscoll, and Gallaugher’s employment ended, especially when one was discharged for cause, one voluntarily quit, and the other was laid off.
Although the number
of carpenters employed by Respondent declined during the backpay period, there
continued to be work available for carpenters on subsequent jobs. In addition to hiring three new carpenters at the beginning of the
pay period, Respondent rehired a carpenter in July 2004, hired a new carpenter
and rehired another in August 2004, and rehired yet another carpenter in
October, 2004. The General Counsel argues,
and I agree, that the evidence shows that there was work available for
carpenters within the backpay period at issue.
Additionally, Respondent admitted during the Compliance Hearing to a preference for rehiring good employees whose work Respondent has been able to observe. Respondent also indicated that he could tell in a short period of time whether a worker was good, and by inference, was worthy of re-hiring or transfer. Respondent further testified to a policy of keeping his core employees busy year round, sometimes at Respondent’s own expense. Indeed, Judge Metz found that of the three employees that Respondent argues should be the sole comparators for the discriminatees, two were themselves hired for one project and then transferred to another while under Respondent’s employment Cheney Construction, 344 NLRB at 6. With the continued availability of work and a policy for retaining or rehiring prior employees, it cannot be t assumed, even without the Dean presumption, that the discriminatees would not have been retained and transferred to perform that work had they been employed in the first place.
B. Reasonableness of Compliance Specification’s Backpay Calculation
The Board in Cobb I, above at 1168, stated the following about the how to review compliance specifications:
The Board’s well-settled policy is that “[a backpay]
formula which approximates what discriminates would have earned had they not
been discriminated against is acceptable if it is not unreasonable or arbitrary
in the circumstances. La Favorita, Inc., 313 NLRB 902 (1994), [enfd. mem. 48 F.3d 1242 (10 Cir.
1995)].
There is nothing in the record that shows the “Comparable Employee Formula” used in the compliance specification to be either “unreasonable or arbitrary.” The compliance formula correctly assumes, under the Dean presumption, that as long as carpenters were being rehired or transferred to other jobs by the employer, there were opportunities for work that could have been filled by the discriminatees had they not been discriminated against.
The Regional Director was careful to take into account a number of factors related to the employee comparators when drafting the compliance specification. The Compliance Specification did not include Respondent’s six “core” employees as comparators. Nor did it calculate backpay for gaps in comparator employment; the period after one comparator quit or was fired and before the next comparator was hired/rehired. No discriminatee was credited with pay when there was no comparable employee working. I find that the specification accurately approximates what the discriminatees would have earned had they not been discriminated against.
C. Mitigation of Damages
In order to qualify for backpay, an employee must make reasonable
efforts to find interim employment. Midwestern Personnel Services., 346 NLRB
No. 58, slip op. at 2 (2006). It is
settled Board policy that an employee seeking interim work “need only follow
his regular method for obtaining work.”
All three discriminatees held multiple jobs between September 2003 and, July 2005. They all took advantage of their union’s hiring hall when out of work. Additionally, all three reported looking for work themselves using a number of job-finding techniques during the backpay period, from contacting past employers to personally visiting job sites. There is no showing by the employer that the discriminatees used less than due diligence in trying to find work. To the contrary, the record shows that each discriminatee made an “honest, good faith effort to find interim work.” Midwestern Personnel Services, Inc., above at 6, quoting Chem Fab Corp., 275 NLRB 21, 21 (1985). I find that the discriminatees succeeded in mitigating their damages.
D. Retention of Union Carpenters
Respondent asserts in its Third Amended Answer to the Compliance Specification that because new-hires Driscoll and Gnadt were union salts who were nevertheless retained after their affiliation became known, their earnings either off set any backpay due to the discriminatees or constituted a waiver by the union and the discriminatees of any right to backpay in the amount of wages earned by Gnadt or Driscoll. In the alternative, Respondent asserts that Driscoll and Gnadt’s employment constituted a remedial hire and retention that negates any obligation by Respondent to pay backpay in the amount of wages earned by Gnadt or Driscoll. These arguments are not addressed in Respondent’s post-hearing brief.
I find no reason to sustain these arguments. The liability of Respondent for violating the Act by discriminating against Union employees has already been established by the Board. A finding of a violation is presumptive proof that backpay is owed to the aggrieved party. La Favorita, above at 902. Proof that the Respondent did not repeat its unlawful acts is irrelevant.
Remedy
I find that the Compliance Specification is a reasonable
and appropriate remedy to the Respondent’s unlawful discrimination against
employees Mumpower, Johns, and Fairchild. Upon the foregoing findings of fact and conclusions
of law, and upon the entire record, and pursuant to Section 10(c) of the Act, I
hereby issue the following recommended[1]
ORDER
It is ordered that Respondent, Cheney Construction Inc, forthwith pay to each of the following persons backpay in the amounts set opposite his name, plus interest computed in the manner prescribed in New Horizons for the Retarded, 283 NLRB 1173 (1987), as required by the Board's Order of February 4, 2005:
Randy Mumpower $17,707.91
David Randy Johns $19,899.78
Kenneth Fairchild $9,358.85
Dated,