how Respondent has failed to adequately rebut the prima facie case of discriminatory hiring. Respondent points to new employee Robert Cousart as an example of one of its outstanding new hires. Mr. Cousart was apprenticed as a marine machinery mechanics between 1968 and 1972. Lieber Dec., Exh. F at 1335-36. He was employed for twenty-two years at the Mare Island Naval Shipyard, where he did mechanical work weapons launching systems. Id. at 1334-36. As a lead worker, he trained new employees in Naval procedures and safety practices. Id. at 1336-37. Mr. Cousart received many commendations for his work. Id. at 1338.
At Pacific Custom, Mr. Cousart works as a general plant helper. Id. at 1342. Interestingly, Mr. Cousart was not initially hired by Pacific Custom.
Lieber Dec., Exh. F. at 1344. This fact undermines Respondent's assertion that its new employees were hired on the basis of their outstanding skills. Even overlooking this fact, however, Pacific Custom still has failed to rebut a prima facie case of antiunion animus in the hiring process. While this Court acknowledges the impressive credentials of Mr. Cousart in the marine machinery mechanics field, Pacific Custom is not in the marine machinery business. The Court presumes that some skills carry over, but Respondent has not presented evidence of the degree of similarity between marine machines and the machinery at Pacific Custom.
Respondent's attempt to rebut the prima facie case of section 8(a)(3) discrimination also falters when one considers the abilities and skills of the former Port Costa employees. For example, Respondent asserts that it did not hire Estrellita Lewis due to her lack of a college education and "because she did not have the same cross-training ability as new employees, nor did her skills and abilities equal theirs." P&A in Response to Pet. at 22; see Allen Dec. at P 49.
The evidence, however, shows that Ms. Lewis was able to work as a prep plant operator, lab technician, general laborer, bobcat operator, forklift operator, quarry operator, and paint operator. Aff. at 172. Respondent does not explain how, in light of the breadth of Ms. Lewis' work experience, she is lacking in cross-training ability. Respondent is similarly vague about how Ms. Lewis' skills and abilities are lacking.
In light of Respondent's failure to explain how the skills of its new employees are relevant to the work undertaken at the Pacific Custom facility, and given a related failure to detail what concrete skills former Port Costa employees lack which preclude them from employment, this Court finds that Petitioner has shown a likelihood of success on the merits of its case: Petitioner has presented some evidence and an arguable legal theory to support its position.
3. Refusal to Bargain with the Union
The NLRA also prevents an employer from refusing "to bargain collectively with the representatives of his employees, subject to the provisions of section 159(a) of this title." 29 U.S.C. § 158(a)(5). Section 159(a) provides that "representatives designated or selected for the purposes of collective bargaining by the majority of the employees in a unit appropriate for such purposes, shall be the exclusive representatives of all the employees in such unit for the purposes of collective bargaining . . . ." Because the NLRA imposes a duty to bargain with the representative of a majority of the employees in an appropriate unit, the initial issue is whether the charging union was such a bargaining representative.
In cases involving "successor employers," the Section 8(a)(5) duty to bargain attaches only when there is a "substantial continuity of identity in the business enterprise." Howard Johnson Co., Inc. v. Detroit Loc. Jt. Ex. Bd., etc., 417 U.S. 249, 94 S. Ct. 2236, 2241-42, 41 L. Ed. 2d 46 (1974). Generally, this requires that the new employer conduct essentially the same business as the former employer and hires a majority of the old employer's work force. NLRB v. Burns International Security Systems, Inc., 406 U.S. 272, 92 S. Ct. 1571, 1577-79, 32 L. Ed. 2d 61 (1972). However, when an employer discriminates in hiring on the basis of union status, the NLRB may properly assume that a majority of employees would have survived the takeover but for the new employer's discrimination, and thus that the new employer is a successor employer. Kallmann v. NLRB, 640 F.2d 1094, 1101 (9th Cir. 1981).
As discussed in Section B.2 supra, the Petitioner has presented some facts and an arguable legal theory regarding Respondent's illegal discrimination in hiring, so the next stage of inquiry concerns whether or not respondent refused to bargain with the Union. Petitioner argues that Respondent, as a successor employer, has refused to bargain with the Union and has unilaterally changed the terms and conditions of employment at the Pacific Customs facility. While a successor employer ordinarily may set initial hiring terms without bargaining with the incumbent union, when this employer hires or should have hired substantially all of the former employees, "the successor must consult with the union before altering the terms and conditions of employment." Kallmann v. NLRB, 640 F.2d 1094, 1102-03 (9th Cir. 1981).
Respondent does not deny that Pacific Custom failed to consult with the Union before altering the terms and conditions of employment. Thus, because there is a fair chance of Petitioner's success in showing that Pacific Custom is a successive employer and failed to consult with the Union before altering the terms and conditions of employment, Petitioner has met its burden of demonstrating a fair chance of success on the issue of Respondent's violation of NLRA Section 8(a)(5).
C. Possibility of Irreparable Injury
In the Ninth Circuit, a district court may presume irreparable injury if Respondent concedes the substance of the charge or if the Board demonstrates a strong likelihood that it will prevail on the merits. However, if the charge is disputed or the Board has only a fair chance of success, the court must consider the possibility of irreparable injury. Miller, 19 F.3d at 460. Respondent has not conceded the substance of the charge, so this Court will examine the possibility of irreparable injury to the moving party if relief is not granted. Alternatively, Petitioner must show that the balance of hardships tips decidedly in its favor. In undertaking these analyses, "the district court must take into account the probability that declining to issue the injunction will permit the allegedly unfair labor practice to reach fruition and thereby render meaningless the Board's remedial authority." Miller, 19 F.3d at 460.
Petitioner has submitted a proposed temporary injunction order that would require Respondent to "cease and desist" from performing certain illegal acts as well as to affirmatively act in the following manner: 1) reinstating twelve former employees of Port Costa Materials; 2) bargaining with the Union as the exclusive collective-bargaining representative; 3) restoring the previous terms and conditions of employment until the parties can bargain in good faith to an agreement; 4) posting copies of the temporary injunction; and 5) submitting a sworn affidavit describing compliance with the temporary injunction.
The remedial authority of the NLRB will undoubtedly be undermined if the temporary injunction is not granted. Because the workers will not be able to delay a job search for an extensive period of time while the NLRB is reaching a decision, an eventual Board decision against the Respondent will be meaningless because the remedy of reinstatement will not likely be carried out. Studies have shown a significant decline in the proportion of discriminatees accepting reinstatement when offered more than six months after a discriminatory discharge or refusal to hire. See Paul Weiler, Promises to Keep: Securing Workers' Rights to Self-Organization Under the NLRA, 96 Harv. L. Rev. 1769, 1792-93 (1983). With the union majority expelled from the workplace, the employer will have effectively removed the union from the facility.
Respondent argues that Petitioner's delay in seeking a temporary injunction implies a lack of urgency and irreparable harm. Indeed, the Ninth Circuit has held that under Section 10(j), delay is "significant if . . . the Board's final order is likely to be as effective as an order for interim relief." Aguayo for NLRB v. Tomco Carburetor Co., 853 F.2d 744, 750 (9th Cir. 1988), overruled on other grounds by Miller, 19 F.3d 449. Because the Board has not unreasonably delayed in filing the temporary injunction and, as discussed in section A, supra, the NLRB will likely take many months to issue a final order, this Court finds that the four month delay in seeking a temporary injunction does not undermine the independent importance of any interim order.
One condition within the proposed injunction worth noting concerns the requirement that Respondent restore the previous terms and conditions of employment. The Ninth Circuit has held that injunctive relief is "just and proper" under section 160(j) when the relief is "necessary to prevent a frustration of the remedial purposes of the Act." Scott v. El Farra Enterprises, Inc., 863 F.2d 670, 674 (9th Cir. 1988). The U.S. Supreme Court has noted that the existence of a bargaining obligation does not compel an employer to issue any particular contract, NLRB v. Burns International Security Services, Inc., 406 U.S. 272, 92 S. Ct. 1571, 1579, 32 L. Ed. 2d 61 (1972). Thus, the reinstatement of former terms and conditions would seem to be inconsistent with the remedial purposes of the NLRA.
The Petitioner argues that the Ninth Circuit has approved of injunctions requiring the interim reinstatement of the previous contract pending the commencement of bargaining between the union and the employer. Scott v. El Farra Enterprises, Inc., 863 F.2d 670 (9th Cir. 1988). However, the text of this decision does not approve of any such remedy. In fact, the Scott court ordered the district court to grant an injunction which stated that the successor employer must reinstate employees to "their former positions under such terms and conditions that may be mutually agreed upon by Respondent and each employee. . . ." Scott, 863 F.2d at 676 (emphasis in text). In light of the fact that the NLRA does not compel an employer to issue any particular contract, the proposed temporary injunction provision which requires Pacific Custom to reinstate the terms and conditions of the Port Costa employment contract do not appear to be just and proper. Accordingly, this Court will not issue such an injunctive provision.
The removal of this injunctive provision also causes the balance of hardships to tip decidedly in favor of the Petitioner. As discussed above, the injunction is necessary to protect the remedial purposes of the NLRA and preserve the authority of the NLRB. Additionally, the grant of an injunction will prevent further harm to the Union and its members who were likely wronged by Respondent's acts.
Respondent may suffer some harm in having to train workers in some new operating procedures and through the loss of the opportunity to rehire the new employees who replaced the former Port Costa workers.
However, the employees which will be reinstated through the injunction are experienced workers, and the evidence shows that many of them have strong records at Port Costa. Because the temporary injunction does not require Respondent to fire any particular employees, Mr. Allen's assertion that the company will lose $ 150,000 a year in having to contract out its maintenance work is without merit. See Allen Dec. at P 91. Respondent is not precluded from making any economically rational choice regarding which of the new hires will remain in the two or three additional positions Pacific Custom has added since taking over the facility. The Court also notes that the cease and desist portions of the injunction merely require Respondent to obey the law, and thus does not burden the Respondent with any hardship unique to the injunction. Hence, this Court also finds that the balance of hardships tips decidedly in favor of the NLRB.
Petitioner has met its burden of establishing "some evidence and an arguable legal theory" as well as irreparable injury if the injunctive relief is not granted. This Court concludes that injunctive relief is necessary to prevent further possible violations of NLRA sections 8(a)(1), (3), and (5). Accordingly, and for good cause showing, the Court ORDERS the following:
Pending the Board's final disposition of this matter, Respondent, its officers, representatives, agents, servants, employees, and all persons acting on its behalf are enjoined and restrained from 1) stating to prospective and current employees that Pacific Custom will not be unionized and that employees cannot be union; 2) asking potential or current employees if they have a problem with the Respondent's union stance; 3) attempting to avoid unionization by withholding employment offers from Donald Davis, Lucio Gutierrez, Steven Thomas, Horacio (Ray) Villalobos, David Schelhorn, Roberto Esparza, Julian Silva, Estrellita Lewis, Danny Smith, and Jesus Esparza; 4) failing or refusing to recognize or bargain with the Union as the exclusive collective bargaining representative of its production and maintenance employees; and 6) interfering with or restraining employees in the exercise of their Section 7 rights.
Pacific Custom Materials is also directed to undertake the following actions: 1) reinstate the above named former employees of Port Costa Materials under terms and conditions which evince good faith; 2) recognize and bargain with the Union as the exclusive collective-bargaining representative of the facility's production and maintenance employees; 3) post copies of this Order at the Pacific Custom facility in all locations where employee notices are customarily posted and send copies of this Order to all employees entitled to offers of reinstatement under this Order; and, 4) within ten days of the issuance of this Order, submit to this Court and the Regional Director, a sworn affidavit describing the manner in which Respondent has complied with this temporary injunction.
IT IS SO ORDERED.
THELTON E. HENDERSON, CHIEF JUDGE
UNITED STATES DISTRICT COURT