Tuesday, 20 September 2016 10:08
A union and a telecommunications provider entered into a collective bargaining agreement. In the agreement, the union waived its members’ right to picket, which is a right that the members otherwise would possess under the National Labor Relations Act (NLRA). During a subsequent labor dispute, the union members displayed pro-union signs in cars that were parked on company property and lined up the cars so that passers-by would see the signs. In response, the company ordered employees to stop displaying the signs. The union workers complied but filed an unfair labor practices charge with the National Labor Relations Board (NLRB).
The NLRB’s Regional Director declined to rule on the charge because she believed the dispute arose “from the contract between the parties.” The collective bargaining agreement entered into between the union and the company contained a provision that the parties would arbitrate all disputes that arose out of the agreement. Thus the dispute was arbitrated. The arbitration resulted in a decision in the company’s favor. The arbitrator found that the union had waived its right to picket under the collective bargaining agreement and that posting signs in parked cars on an employer’s lot constituted picketing. As such, the company was within its rights to ask the union members to remove the signs.
The union disagreed with the arbitrator’s decision and brought the matter to the NLRB. An administrative judge once more ruled in the company’s favor. Again, the union disagreed with this decision and appealed to the NLRB. In a 2-1 decision, the NLRB overturned the twice upheld arbitration decision. As a result, the company appealed the NLRB’s decision to the United States Court of Appeals for the District of Columbia Circuit.
The Court of Appeals began its analysis by noting that the NLRB is required to uphold an arbitration award unless the award is “clearly repugnant” to the NLRA. An arbitrator’s decision is not “clearly repugnant” unless the decision is completely wrong such that it could not be consistent with the purpose of the NLRA. While the legal question at issue was whether the union’s waiver of its right to picket was an action that could be waived under the NLRA as the arbitrator concluded, because the Court of Appeals reviews NLRB decisions under a deferential standard, the issue before the Court of Appeals was simply whether the NLRB’s decision was reasonable and reasonably explained.
The Court of Appeals found that although Section 7 of the NLRA guarantees employees the right to picket, which includes the right to post signs in parked cars, a union may waive that right in a collective bargaining agreement. Absent a waiver, however, Section 8 of the NLRA makes an employer’s violation of a Section 7 right an “unfair labor practice.” Since the union has the ability to waive that right, and had done so, the arbitration decision was consistent with the NLRA.
As the arbitrator’s decision was found to be valid under the NLRA, the Court of Appeals held that the decision was far from being “clearly repugnant.” Therefore, the NLRB should have upheld the arbitration decision. While an arbitrator’s “palpably wrong” interpretation of a contract can render the decision “clearly repugnant,” in this case, the Court reasoned that the mere fact that the NLRB might read a contract term differently than the arbitrator read it does not suffice to make an arbitrator’s reading of the contract “palpably wrong.” The Court of Appeals therefore granted the company’s request to overturn the NLRB’s decision.