Kimberly Stewart v. NLRB , 851 F.3d 21 ( 2017 )

United States Court of Appeals
FOR THE DISTRICT OF COLUMBIA CIRCUIT
Argued September 7, 2016 Decided March 21, 2017
No. 15-1102
KIMBERLY STEWART, ET AL.,
PETITIONERS
v.
NATIONAL LABOR RELATIONS BOARD,
RESPONDENT
UNITED FOOD & COMMERCIAL WORKERS LOCAL 99,
INTERVENOR
On Petition for Review of an Order
of the National Labor Relations Board
Glenn M. Taubman argued the cause and filed the briefs
for petitioners.
David Seid, Attorney, National Labor Relations Board,
argued the cause for respondent. With him on the brief were
Richard F. Griffin, Jr., General Counsel, John H. Ferguson,
Associate General Counsel, Linda Dreeben, Deputy Associate
General Counsel, and Ruth E. Burdick, Supervisory Attorney.
Kristin L. Martin argued the cause for intervenor. With
her on the brief was Eric B. Myers.
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Before: SRINIVASAN and WILKINS, Circuit Judges, and
SILBERMAN, Senior Circuit Judge.
Opinion for the Court filed by Circuit Judge SRINIVASAN.
Dissenting opinion filed by Senior Circuit Judge
SILBERMAN.
SRINIVASAN, Circuit Judge: Employees commonly pay
their union dues through a mechanism known as a checkoff
arrangement. In a checkoff arrangement, an employee
authorizes her employer to deduct union dues from her
paycheck and remit the dues directly to the union on her
behalf. That arrangement affords convenience and efficiency.
It enables unions to avoid collecting payments from
potentially numerous individual employees, and it enables
employees to avoid writing periodic dues checks to the union.
An employee’s authorization for her employer to check
off union dues from her wages is not irrevocable. A federal
statute, Section 302(c)(4) of the Labor Management Relations
Act, specifies circumstances in which an employee must be
afforded the opportunity to revoke a checkoff authorization.
And collective bargaining agreements, when establishing the
availability of a checkoff arrangement for paying dues,
correspondingly set out how an employee can revoke an
authorization.
In this case, a group of employees, during the period
between the expiration of the operative collective bargaining
agreement and the commencement of a new one, resigned
from their union and sought to revoke their dues-checkoff
authorizations. The company, however, continued to deduct
union dues from the employees’ wages, and the union
continued to accept the payments. The National Labor
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Relations Board rejected charges that the company and union
had committed an unfair labor practice by continuing to check
off union dues from the employees’ wages.
We vacate the Board’s decision and remand the matter to
the agency. The Board treated the case as a straightforward
application of its precedent pertaining to the revocability of
dues-checkoff arrangements. But the circumstances of this
case, as it comes to us, differ in significant ways from those in
the precedent on which the Board relied. On remand, if the
Board were to attempt to reach the same result again, it would
need to explain how the outcome could be squared with its
precedent and governing law. Because the Board’s decision,
as it stands, lacks any such explanation, we cannot sustain it.
I.
A.
Section 302(c)(4) of the Labor Management Relations
Act speaks to the revocability of an employee’s dues-checkoff
authorization. The Act generally makes it a crime for an
employer to give payments to a labor union. 29 U.S.C. § 186.
Section 302(c)(4) establishes an exception to that prohibition
for dues-checkoff transfers from an employer to a union on an
employee’s behalf. The exception states that the criminal bar
on employer payments to a union is inapplicable “with respect
to money deducted from the wages of employees in payment
of membership dues in a labor organization.” Id. § 186(c)(4).
The exception requires, however, that an employee’s
checkoff authorization be revocable in enumerated
circumstances. In particular, the employer must have
“received from each employee, on whose account such
deductions are made, a written assignment which shall not be
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irrevocable for a period of more than one year, or beyond the
termination date of the applicable collective agreement,
whichever occurs sooner.” Id.
Those criminal provisions are administered by the
Attorney General, not the National Labor Relations Board.
But the Board has long held that employers and unions
engage in unfair labor practices under Sections 8(a)(1)-(3) and
8(b)(1)(A) of the National Labor Relations Act if they check
off union dues without an employee’s valid authorization.
See e.g., Frito-Lay, Inc., 243 N.L.R.B. 137, 137 (1979). And in
examining whether employers and unions have committed
unfair labor practices in that connection, the Board has
interpreted Section 302(c)(4)’s directive that an employee’s
checkoff authorization “shall not be irrevocable for a period
of more than one year, or beyond the termination date of the
applicable collective agreement, whichever occurs sooner.”
29 U.S.C. § 186(c)(4).
The Board has long understood that language to
“guarantee[] an employee two distinct rights when he
executes a checkoff authorization under a collective-
bargaining agreement.” Atlanta Printing Specialties, 215
N.L.R.B. 237, 237 (1974), enf’d, 523 F.2d 783 (5th Cir. 1975).
The first right, the Board explained in Atlanta Printing, is a
“chance at least once a year to revoke his authorization” on
the annual anniversary of his execution of the authorization.
Id. The second right is “a chance upon the termination of the
collective-bargaining agreement to revoke his authorization.”
Id. And because the employer and union in Atlanta Printing
had denied the “statutory rights” conferred by Section
302(c)(4), the Board held that they had committed an unfair
labor practice. Id. at 238.
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The Board’s later decision in Frito-Lay, Inc., 243 N.L.R.B.
137 (1979), elaborates on its understanding of Section
302(c)(4) in a manner of particular relevance here. The
employees in Frito-Lay executed checkoff authorizations
which were irrevocable except during two 10-day “escape”
windows corresponding to the dual rights recognized in
Atlanta Printing: the first window was an annual 10-day
period commencing 20 days before the yearly anniversary of
an employee’s checkoff authorization, and the second window
was a 10-day period commencing 20 days before the
expiration of the operative bargaining agreement. The
employees in question attempted to revoke their checkoff
authorizations during a hiatus period between bargaining
agreements—i.e., after expiration of the operative agreement.
The company and union denied the revocation requests and
continued deducting union dues. They reasoned that, under
the terms of the checkoff authorizations, the employees had
been required to revoke during the specified 10-day window
preceding the initial agreement’s expiration, and had no
entitlement to do so after its expiration.
The Board agreed, rejecting the General Counsel’s
argument that the company and union committed an unfair
labor practice by continuing to check off union dues during
the contract hiatus. The General Counsel, relying on Section
302(c)(4)’s guarantee of a revocation opportunity “beyond the
termination date of the applicable collective agreement,”
contended that the employees had a statutory entitlement to
revoke their checkoff authorizations after the initial
agreement’s expiration. The Board was unpersuaded. It
initially indicated that a violation of Section 302(c)(4) would
not necessarily establish an unfair labor practice (even though
it had found an unfair labor practice in Atlanta Printing based
on a denial of the rights granted by that section). Id. at 138.
The Board went on to hold that, insofar as Section 302(c)(4)
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bears on the existence of an unfair labor practice, there had
been no violation of the statute. Id. at 138-39.
The Board explained that “there is no violation of Section
302(c)(4) . . . as long as employees are accorded an
opportunity to revoke their authorizations at least once a year
and at the termination of any applicable collective-bargaining
agreements.” Id. at 138. And in the Board’s view, “the
limiting of the opportunity to revoke to a reasonable escape
period, such as between 20 and 10 days before the expiration
of either of these periods, does not require a different result.”
Id. Because “the employees did not revoke their
authorizations during either of these escape periods, the
Union and Employer were justified in considering the
authorizations still valid.” Id. at 139.
Although the Board initially questioned in Frito-Lay the
extent to which a violation of Section 302(c)(4) would
necessarily occasion the finding of an unfair labor practice, it
has since reverted to its understanding in Atlanta Printing of
an association between Section 302(c)(4) and unfair labor
practices relating to checkoff. See Int’l Bd. of Elec. Workers
(Lockheed), 302 N.L.R.B. 322, 325 n.8 (1991); WKYC-TV, Inc.,
359 N.L.R.B. 286, 289 n.13 (2012). And after Frito-Lay and
Atlanta Printing, the Board understands Section 302(c)(4) to
establish a statutory right to two opportunities to revoke a
checkoff authorization: one tied to the annual anniversary of
the authorization, and the second tied to the expiration of the
operative collective bargaining agreement. With respect to
each of those two opportunities, the Board concluded in Frito-
Lay, the bargaining agreement can validly confine the
available revocation window to a reasonable escape period
preceding the anniversary and expiration dates, respectively.
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B.
With that backdrop in mind, we turn to the dispute in this
case. Fry’s Food Stores is a retail grocery company with
stores throughout Arizona. Arizona is a right-to-work state,
meaning that employment cannot be conditioned on
membership in a union or payment of union dues. But the
company entered into a collective bargaining agreement with
a union representing a unit of employees (United Food and
Local 99, AFL-CIO) and the agreement established the
availability of a checkoff arrangement for paying dues.
The agreement set forth the terms of an employee’s
checkoff authorization, which was to include a specification
that “[t]his Check-Off Authorization and Agreement is
separate and apart from the [Union] Membership Application
and is attached to the Membership Application only for
convenience.” Smith’s Food & Drug Centers Inc., 358 N.L.R.B.
704, 706 (2012). The agreement also prescribed the language
of the checkoff authorizations with regard to the periods in
which an employee’s authorization would be revocable. On
that score, the checkoff authorizations were to state:
This authorization and assignment shall be
irrevocable for a period of one (1) year from
the date of execution or until the termination
date of the agreement between the Employer
and Local 99, whichever occurs sooner, and
from year to year thereafter, unless not less
than thirty (30) days and not more than forty-
five (45) days prior to the end of any
subsequent yearly period I give the Employer
and Union written notice of revocation bearing
my signature thereto.
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Id.
The relevant bargaining agreement prescribing those
terms was in effect for a five-year period, from October 26,
2003, to October 25, 2008. During that time, a group of
employees who are now the petitioners in this case executed
checkoff authorizations containing the language quoted
above. After the bargaining agreement expired, the company
and union proved unable to agree on a successor contract for
over a year, until November 12, 2009. (For much of the
hiatus period between bargaining agreements, the parties
entered into a series of short-term extension agreements
carrying over the terms of the initial contract.)
Between the expiration of the initial agreement on
October 25, 2008, and the execution of the new one on
November 12, 2009, petitioners provided notice of their
resignation from the union. They also sought to revoke the
checkoff authorizations they had executed while the initial
agreement was in effect. The union honored petitioners’
resignations from its membership, but it refused to give effect
to their attempted revocation of their checkoff authorizations.
In letters to petitioners, the union explained that their
attempted revocations had been untimely because, under the
terms of their checkoff authorizations, they needed to revoke
during the prescribed 15-day window preceding the
anniversary of their authorizations (i.e., between 30 and 45
days before the anniversary date). The company therefore
continued to deduct union dues from petitioners’ paychecks.
Petitioners initiated unfair labor practice charges against
the company. The Board’s General Counsel then issued an
amended complaint against the company and union,
contending that the continued deduction and transfer of union
dues during the contract hiatus constituted an unfair labor
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practice. The General Counsel put forward two theories.
First, he contended that petitioners had an entitlement to
revoke their checkoff authorizations after the expiration of the
operative collective bargaining agreement. Second, he argued
that petitioners’ resignations from union membership should
have been treated as a revocation of their dues-checkoff
authorizations and given effect as of the next available
revocation period.
The ALJ dismissed the complaint and ruled in favor of
the company and union. As a predicate to his analysis, the
ALJ construed the checkoff authorizations’ language
concerning when an employee could revoke an authorization.
First, the ALJ found, “every employee who signed an
authorization during [the 2003-2008] contract could revoke
the authorization during the window periods preceding the
yearly anniversary date that the employee signed the
authorization.” Smith’s Food & Drug, 358 N.L.R.B. at 708. “In
addition, employees who signed authorizations during the last
year of the contract could revoke their authorizations upon the
expiration of that contract.” Id.
In light of that understanding, the ALJ considered
petitioners’ requests to revoke their checkoff authorizations to
have been invalid. None of them had submitted a revocation
request during the yearly 15-day escape window preceding
the anniversary date of their checkoff authorizations. Rather,
they had sought revocation during the hiatus period between
the collective bargaining agreements. As a result, the ALJ
concluded, petitioners’ requests had been untimely.
The ALJ rejected the argument that, notwithstanding the
terms of the checkoff authorizations, petitioners had an
entitlement to revoke upon the collective-bargaining
agreement’s expiration. Employees, the ALJ held, had no
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right to “revoke their checkoff authorizations during time
periods that are not specified in the authorizations that they
had signed.” Smith’s Food & Drug, 358 N.L.R.B. at 707. The
ALJ relied on the Board’s decision in Frito-Lay. He
understood Frito-Lay to have “rejected the notion that
employees are free to revoke their checkoff authorizations at
will during the hiatus period between contracts.” Id. “Here,
like in Frito-Lay,” the ALJ determined, “employees were not
entitled to withdraw at will during the hiatus period.” Id.
The ALJ also rejected the argument that petitioners’
resignations from union membership should have been treated
as revocations of their checkoff authorizations. He relied on
Board decisions “allow[ing] for the possibility that an
employee may no longer wish to remain a member of a union
but nonetheless desire[] to contribute to a union for contract
administration expenses via a checkoff authorization.” Id. at
707. The key question under the Board’s decisions, the ALJ
reasoned, is whether the language of an employee’s checkoff
authorization “clearly indicate[s] an agreement to pay dues
irrespective of membership in the union.” Id. at 706. The
checkoff authorizations in this case, the ALJ concluded, met
that standard.
The Board summarily affirmed the ALJ’s rulings,
findings, and conclusions, and adopted the ALJ’s
recommended order. Petitioners now seek review of the
Board’s decision in this court.
II.
Petitioners challenge the Board’s decision on two
grounds. Their chief argument is that the Board’s precedent
in Frito-Lay, on which the Board rested its decision below,
cannot be squared with the terms of Section 302(c)(4) of the
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Labor Management Relations Act. Their second argument is
that the Board should have treated their resignations from the
union as requests to discontinue the checkoff of union dues at
the earliest available opportunity.
A.
We start with petitioners’ challenge to the Board’s
decision in Frito-Lay. Petitioners rely on Section 302(c)(4)’s
directive that an employee’s checkoff authorization “shall not
be irrevocable for a period of more than one year, or beyond
the termination date of the applicable collective agreement,
whichever occurs sooner.” 29 U.S.C. § 186(c)(4) (emphasis
added). The highlighted text, petitioners contend, grants
employees an at-will entitlement to revoke a checkoff
authorization upon the expiration of the operative collective-
bargaining agreement, regardless of any language in a
checkoff authorization purporting to require employees to
seek revocation within a specified, pre-expiration escape
window. The Board rejected that proposition in Frito-Lay.
The Board saw no inconsistency with Section 302(c)(4) in
enforcing a requirement to seek revocation during an escape
window preceding the bargaining agreement’s expiration.
The parties present this case as a referendum on Frito-
Lay, in line with the Board’s treatment of the case as a routine
application of that decision. We see the case differently. On
examination, the circumstances of this case turn out to differ
significantly from those in Frito-Lay, so much so that we
cannot sustain the Board’s decision on the rationale on which
it was grounded.
Recall that, in Frito-Lay, the Board understood there to
be “no violation of Section 302(c)(4) . . . as long as
employees are accorded an opportunity to revoke their
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authorizations at least once a year and at the termination of
any applicable collective-bargaining agreements.” 243
N.L.R.B. at 138 (second emphasis added). And in Atlanta
Printing beforehand, the Board had likewise read Section
302(c)(4) to “guarantee[]” an employee the right to revoke an
authorization “upon the termination of the collective-
bargaining agreement.” 215 N.L.R.B. at 237. The Board thus
interpreted Section 302(c)(4) to call for some revocation
opportunity tied to the collective-bargaining agreement’s
expiration (along with a revocation opportunity connected to
the yearly anniversary of an employee’s checkoff
authorization). In Frito-Lay, the Board thought it adequate if
the revocation opportunity connected to the agreement’s
expiration took the form of a reasonable, pre-expiration
escape window (such as the 10-day window at issue in that
case), rather than at-will revocation after the agreement
expired. See 243 N.L.R.B. at 138-39.
But what about a case in which employees are denied any
revocation opportunity in connection with the bargaining
agreement’s expiration? Frito-Lay does not speak to that
question. All of the employees in Frito-Lay had a revocation
window tied to the agreement’s expiration, a consideration the
Board thought pivotal in finding no inconsistency with
Section 302(c)(4). And in Atlanta Printing, the Board had
previously explained that employees must be afforded a
chance to revoke their authorizations at the time of a
bargaining agreement’s expiration. Frito-Lay thus cannot be
understood to establish the permissibility of circumstances in
which employees generally lack any revocation opportunity
connected to the expiration of the operative bargaining
agreement.
This is just such a case, at least as it comes to us. For our
purposes, what matters is the way in which the ALJ construed
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the employees’ checkoff authorizations. He concluded that,
although all employees had a 15-day revocation window
connected to the yearly anniversary of their checkoff
authorizations, they had no such revocation opportunity with
regard to the bargaining agreement’s expiration. Specifically,
the ALJ, in construing “the checkoff-authorization form in the
context of the [2003-2008] collective-bargaining agreement,”
found that “every employee who signed an authorization
during that contract could revoke the authorization during the
window periods preceding the yearly anniversary date that the
employee signed the authorization.” Smith’s Food & Drug,
358 N.L.R.B. at 706. But he perceived no comparable
opportunity for all employees in connection with the
agreement’s expiration. Rather, only those “employees who
signed authorizations during the last year of the contract could
revoke their authorizations upon the expiration of that
contract.” Id.
The ALJ later reiterated the same conclusion when
responding to the suggestion that the authorizations were
ambiguous. He said he had “already concluded the
authorizations were sufficiently clear to allow each employee
who signed an authorization during the 2003-2008 contract
the opportunity to revoke the authorization during the window
periods preceding the yearly anniversary date that the
employee signed the authorization.” Id. at 708. “In addition,”
those “employees who signed authorizations during the last
year of the contract could revoke their authorizations upon the
expiration of that contract.” Id. Other employees thus had no
revocation opportunity tied to the contract’s expiration.
Even though the ALJ unambiguously (and twice) set out
his understanding that only certain employees—those who
signed authorizations in the bargaining agreement’s last
year—had received any revocation opportunity tied to the
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agreement’s expiration, our dissenting colleague perceives the
ALJ to have determined otherwise. Dissent 2-4. According
to the dissent, the ALJ in fact concluded that all employees
had a 15-day window preceding the contract’s expiration
within which to revoke their authorizations. As the dissent
sees it, the ALJ ostensibly indicated that belief in the final
paragraphs of his opinion, in the midst of a closing section
explaining his refusal to consider an argument the Board’s
General Counsel sought to make for the first time—viz., that
the checkoff authorizations were facially invalid in failing to
provide for a revocation opportunity tied to the bargaining
agreement’s expiration. To show that the General Counsel
had made no such argument until that point, the ALJ quoted
the General Counsel’s oral statement at trial as follows: “And
at trial while discussing with me the window period prior to
the expiration of the contract, the General Counsel conceded:
‘Well, I think both parties agree that during the 15 day period
before October of 2008 that the parties could revoke. . . . I’m
not arguing that.’” Smith’s Food & Drug, 358 N.L.R.B. at 709.
The General Counsel, that is, had previously said he was “not
arguing” the very thing he now sought to argue.
The ALJ thus quoted the General Counsel’s prior
statement to demonstrate that the General Counsel’s new
facial-validity argument stood at odds with his previously
stated position, and so would not be considered. In the view
of our dissenting colleague, however, the ALJ, in referencing
the General Counsel’s statement, effectively made a finding
endorsing the statement. Dissent 2-3. We do not see how that
could be the case. If the ALJ in fact aimed to determine that
all employees had a 15-day revocation window before the
contract’s expiration, let alone do so through the circuitous
route of referencing the General Counsel’s oral statement,
then why would the ALJ—when directly expounding his
understanding of the revocation opportunities granted to the
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company’s employees—twice describe the employees who
had a revocation opportunity tied to the contract’s expiration
as limited to those employees who signed their authorizations
in the contract’s last year? Why single out those employees
alone for mention? The answer is plain: the ALJ believed
those were the only employees who in fact had been granted a
revocation opportunity tied to contract’s expiration, regardless
of any suggestion otherwise by the parties (including the
Union, see Dissent 2). Indeed, the ALJ’s determination to
that effect is only reinforced by his quotation of the General
Counsel in the opinion’s final paragraphs: although the ALJ
was aware of (and took note of) the General Counsel’s
statement that all employees had a revocation opportunity tied
to the contract’s expiration, the ALJ twice explained that such
an opportunity was confined to those employees who had
signed an authorization in the contract’s last year.
On that understanding, the facts in this case differ
meaningfully from those in Frito-Lay. In Frito-Lay, a
revocation window tied to the collective-bargaining
agreement’s expiration was available to all employees, which
the Board considered significant in finding no inconsistency
with Section 302(c)(4). Here, by contrast, the ALJ found that
employees generally lacked any revocation opportunity
associated with the contract’s expiration. To be sure, the ALJ
found that some employees—those who executed a checkoff
authorization in the contract’s final year—could revoke their
authorizations at the time of the contract’s expiration. But
nothing in Frito-Lay purports to speak to a situation in which
only those employees who sign authorizations in a contract’s
final year are afforded a revocation opportunity tied to the
contract’s expiration. In fact, the Board confirmed in its brief
in this case that none of its decisions (including Frito-Lay)
affirmatively addresses that situation: it observed that it “has
had no occasion to pass on whether a revocation period at the
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expiration of a bargaining agreement can be limited to those
who sign authorizations during the last year of [the]
agreement.” NLRB Br. 31 n.8. The Board itself thus
disclaims any suggestion that Frito-Lay governs on the facts
of this case as understood by the ALJ. (The Board’s
statement, it bears noting, also undermines the dissent’s
protestation, Dissent 3-4, that “[i]t has never been asserted by
anyone” that employees could permissibly be denied both a
pre-expiration revocation window and a post-expiration
revocation opportunity—the Board pointedly sought to
preserve that exact possibility in its brief in this case.)
Although the Board advises that none of its decisions
speaks to the proper result on the facts here as understood by
the ALJ, the ALJ decided the case against petitioners on the
belief that Frito-Lay squarely controls. The ALJ reasoned
that, in Frito-Lay, “the Board rejected the notion that
employees are free to revoke their checkoff authorizations at
will during the hiatus period between contracts.” Smith’s
Food & Drug, 358 N.L.R.B. at 707. The ALJ then assumed that
petitioners likewise could have no such entitlement. Id. But
Frito-Lay reached that conclusion in a situation in which
employees had a revocation opportunity tied to the bargaining
agreement’s expiration (which Atlanta Printing had
previously said was required). There was no such opportunity
for petitioners in this case, per the ALJ’s understanding.
The ALJ’s belief that Frito-Lay straightforwardly
compels a ruling against petitioners must also be imputed to
the Board. The Board summarily affirmed the ALJ’s
decision. In doing so, the Board did not reject the ALJ’s
understanding that petitioners and other employees generally
lacked any revocation window tied to the bargaining
agreement’s expiration. Nor did the Board reject the ALJ’s
treatment of this case as a routine application of Frito-Lay.
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Rather, the Board expressly endorsed the ALJ’s rulings,
findings, and conclusions. The Board’s decision therefore
necessarily rests on the same flawed premise as the ALJ’s—
that Frito-Lay directly controls this case.
In oral argument, the Board’s counsel drew attention to a
footnote in the Board’s summary affirmance of the ALJ, in
which the Board stated:
In adopting the [ALJ]’s dismissal of the complaint,
we note that (a) the Acting General Counsel does not
contest the facial validity of the Respondent Union’s
standard dues-checkoff authorization agreement, and
(b) there is no evidence that any of the Charging
Parties attempted to revoke—or even inquired about
revoking—their authorizations during any of the
possible window periods. We thus find it
unnecessary to pass on the Respondent Union’s
contention that we should give deference to its
interpretation of the language of the authorization
agreement.
Id. at 704 n.2.
That footnote did not somehow transform a non-Frito-
Lay case into a Frito-Lay case. Whatever may be the
footnote’s precise meaning, it does not reject the ALJ’s
factual understanding that the employees had no revocation
opportunity tied to the bargaining agreement’s expiration. At
best, the Board thought “it unnecessary to pass on” the
Union’s interpretation of the authorizations, thereby leaving
the ALJ’s understanding in place for our purposes. The
bottom line, then, is this: the facts as found by the ALJ (and
as left undisturbed by the Board) take this case outside the
sphere of Frito-Lay, yet the rationale of the ALJ (and thus of
18
the Board in its summary affirmance) treats the case as
squarely controlled by Frito-Lay.
When an agency’s decision cannot be sustained by the
rationale on which it rests, we must set it aside. See SEC v.
Chenery Corp., 332 U.S. 194, 196-97 (1947). Perhaps the
Board applied Frito-Lay based on a mistaken assumption that
the facts here are no different. Or perhaps the Board applied
Frito-Lay based on a mistaken belief that the decision directly
controls notwithstanding the significant factual difference.
Either way, the Board’s treatment of this case as a routine
application of Frito-Lay cannot be squared with the rationale
of that decision. And this court “cannot uphold a decision
where an agency departs from established precedent without a
reasoned explanation.” LePage’s 2000, Inc. v. Postal
Regulatory Comm’n, 642 F.3d 225, 234-35 (D.C. Cir. 2011).
The Board’s footnote might be seen to suggest one other
possible rationale for its decision. In noting the absence of
any dispute about the “facial validity” of the checkoff
authorizations, the Board perhaps hinted at a belief that the
particular way in which the challenge was brought before it—
i.e., as something other than a dispute about “facial
validity”—bore in some way on the applicability of Frito-
Lay. But it is far from clear why that should be so; and more
importantly, the Board gave no clear indication in its decision
that it was adopting any such theory. A court cannot “be
expected to chisel that which must be precise from what the
agency has left vague and indecisive.” Chenery, 332 U.S. at
197. In any event, the Board’s briefing before us makes no
attempt to explain (or defend) its decision along these lines,
leaving us unable to understand the Board’s decision in a way
the Board itself does not urge.
Rather, the Board defends its decision on the assumption
that this is a Frito-Lay case, and on the theory that Frito-Lay
19
was correctly decided. The assumption, for all the reasons
explained, is incorrect—this is not a Frito-Lay case. We
therefore vacate the Board’s decision and remand the case to
the agency. On remand, insofar as the Board might seek to
reinstate the same result in favor of the company and union,
the Board would need to explain how it could do so
consistently with Frito-Lay and Atlanta Printing or justify any
departure from those decisions.
We note, finally, that our disposition renders it
unnecessary to address the union’s objection to our
consideration of the ultimate correctness of the Board’s
decision in Frito-Lay. The union contends that, when the
Board’s General Counsel brings a complaint before the
agency, we cannot entertain challenges to the Board’s
decision that deviate from arguments made by the General
Counsel before the agency. See 29 U.S.C. § 153(d). Here,
the union submits, we cannot consider petitioners’ challenge
to Frito-Lay’s consistency with Section 302(c)(4) because the
General Counsel assumed Frito-Lay’s validity. We have no
occasion to consider the union’s objection to our
consideration of petitioners’ challenge to Frito-Lay: because
we conclude that the Board’s decision cannot be sustained as
an application of Frito-Lay, we do not reach the merits of
petitioners’ challenge to that decision.
B.
Having disposed of petitioners’ Frito-Lay challenge in
that fashion, we turn briefly to their second challenge to the
Board’s decision—i.e., that their resignations from union
membership during the hiatus period should have caused the
company and union to cease checking off their union dues.
The Board’s precedents hold that, when the language of a
checkoff authorization “clearly set[s] forth an obligation to
20
pay dues even in the absence of union membership,” an
employee “has bound himself or herself to pay the dues even
after resignation of membership.” Lockheed, 302 N.L.R.B. at
219. In that situation, resignation from the union will not
itself effect revocation of a checkoff authorization.
Petitioners do not challenge the principle established in
Lockheed; nor do they dispute that the checkoff authorizations
in this case indicated with adequate clarity that their
resignations from union membership would not automatically
negate their checkoff authorizations. Petitioners instead
present what they perceive to be a distinct argument. They
contend that, when they resigned their union membership, the
company and union were required to cease checking off their
union dues in the next available revocation period. And the
next available period was already at hand, petitioners argue,
because, under their Frito-Lay challenge, they had an at-will
entitlement under Section 302(c)(4) to revoke their checkoff
authorizations during the hiatus between bargaining
agreements. Petitioners’ argument in this regard, by its own
terms, depends on their having prevailed on their Frito-Lay
challenge: according to petitioners, if they had an at-will
entitlement to revoke their authorizations during the contract
hiatus per that challenge, then their resignations during the
hiatus should have led to an immediate cessation of the
checkoff of their dues.
Because petitioners would have already prevailed under
their first argument before their second one comes into play, it
is unclear what, if anything, petitioners independently stand to
gain from their second argument. Regardless, their second
argument is contingent on (and overlaps with) their first to an
extent that our vacatur and remand as to their first argument
counsels in favor of the same disposition as to the second
argument as well. On remand, if the Board ultimately
21
concludes that petitioners had an entitlement to revoke their
checkoff authorizations during the contract hiatus for
purposes of their Frito-Lay challenge, the Board can then
assess whether there is any need to address petitioners’
argument based on their resignations.
* * * * *
For the foregoing reasons, we vacate the Board’s decision
and remand the case to the agency for further proceedings
consistent with this opinion.
So ordered.
SILBERMAN, Senior Circuit Judge, dissenting: This case is
a hot potato. It is a straightforward dispute over the proper
interpretation of a criminal statute, section 302 of the Labor
Management Relations Act, 29 U.S.C. § 186, and the
relationship between that statute and section 8 of the National
Labor Relations Act, id. § 156. The question is: Does the
criminal statute mean employees have a legal right to revoke
dues checkoff authorizations after the termination of an
“applicable collective bargaining agreement”? Or can a union
frustrate that right by providing only a “window period” for
revocation before termination? The majority opinion avoids
answering the question – presented by all parties – by purporting
to discover an ambiguity in the Board’s opinion that none of the
parties perceived, and I do not believe exists, thereby justifying
a remand.
To be sure, there is an ambiguity in the case, i.e., the dues
checkoff authorization cards signed by grocery store clerks are
ambiguous:
This authorization and assignment is voluntarily made
in consideration for the cost of representation and
collective bargaining and is not contingent upon my
present or future membership in the Union. This
authorization and assignment shall be irrevocable for
a period of one (1) year from the date of execution or
until the termination date of the agreement between the
Employer and Local 99,whichever occurs sooner, and
from year to year thereafter, unless not less than thirty
(30) days and not more than forty-five (45) days prior
to the end of any subsequent yearly period I give the
Employer and Union written notice of revocation
bearing my signature thereto.
Smith’s Food & Drug Ctrs. Inc., 358 N.L.R.B. 704, 706 (2012).
2
It is not clear from the text of the authorization whether the
subsequent year-to-year period of irrevocability runs from the
date of the expiration of the first year or the termination date of
the contract, and also whether the window period – during which
an employee can revoke – precedes the anniversary date or the
expiration of the agreement, or both.
Indeed, the General Counsel claimed that the checkoff
forms were ambiguous, but the ALJ rejected that claim. The
ALJ said the authorizations were “sufficiently clear” to allow
each employee who signed an authorization during the 2003-
2008 contract the opportunity to revoke that authorization during
the window periods preceding his or her anniversary date. Id. at
708. He then wrote a sentence while examining the
authorization cards upon which the majority rests its entire
opinion: “In addition, employees who signed authorizations
during the last year of the contract could revoke their
authorizations upon the expiration of th[e] contract.” Id. The
majority concludes that because in that sentence the ALJ
neglected to mention a window period before the termination of
the contract, he implicitly found there was no additional window
period before the contract terminated – and therefore the main
issue presented by the parties is not really before us. If there
was no window period before the termination of the contract,
under Board doctrine, employees would clearly have a right to
revoke their authorization at will during the hiatus, after
termination of the contract.
There is a very good reason why none of the three parties
before us discovered this anomaly in the Board’s decision – it
does not exist. At trial, the union representative confirmed there
was “a window period 30 to 45 days prior to the anniversary
date of signing it and prior to the expiration of the contract.”
(emphasis added). The ALJ endorsed this understanding of the
3
pre-termination window periods later in his opinion, making
absolutely clear that there was – as a matter of practice – a
window period before the expiration of the contract. He said,
“And at the trial while discussing with me the window period
prior to the expiration of the contract, the General Counsel
conceded: ‘Well, I think both parties agree that during the 15
day period before October of 2008 that the parties could
revoke.’” Id. at 709 (emphasis added). In other words, although
the authorization cards could be read as omitting a window
period prior to expiration of the contract, as the ALJ had earlier
noted, the parties actually interpreted the authorization as
providing a window period of 15 days before termination of the
contract, and therefore the ALJ recognized the pre-termination
window period existed. No party challenged that factual
proposition. Indeed, the Board’s brief states that the Board “has
had no occasion to pass on whether a revocation period at
[before] the expiration of a bargaining agreement can be limited
to those who sign authorizations during the last year of a
bargaining agreement.” Yet that is exactly the issue the majority
believes this case presents. But that is not the Board’s view. In
sum, the very premise of the majority opinion is – I am almost
reluctant to say – absolutely false. It is entirely made up.
If the majority were correct and somehow all the parties to
this case misunderstood the ALJ’s opinion – i.e., employees who
signed authorization cards before the last year were entitled to
revoke at termination because there was no window period for
them – then there would be no possible reason why the ALJ
would not have granted employees in that category relief under
longstanding Board doctrine. See Atlanta Printing Specialties,
215 N.L.R.B. 237 (1974), enf’d, 523 F.2d 783 (5th Cir. 1975). It
has never been asserted by anyone, the parties to this case, the
Board, nor any court, that under section 302 employees can be
denied an opportunity to revoke authorization cards after
4
termination of an applicable collective bargaining agreement if
there is no pre-termination window period. In other words, the
only ground that can be advanced – and I think it is a gimmick
– to deprive an employee of a right to revoke after termination
is a window period. See Frito-Lay, Inc., 243 N.L.R.B. 137 (1979).
In an effort to find an ambiguity in the ALJ’s opinion – a pearl
in the oyster – the majority attributes to the ALJ an absurd
position. It is not a pearl the majority has found; it is a piece of
sand.
The ALJ (and the Board1), without the majority’s creative
assistance, understood it was required to face the question
whether under section 302 employees had an absolute right to
withdraw their authorization after termination of the contract,
during the hiatus period before a new contract was signed. See
29 U.S.C. § 186(c)(4). (All parties agree that the series of
interim agreements have no legal significance.) To that
question, the ALJ had an easy answer. The Board decided that
question years ago in Frito-Lay. Smith’s Food & Drug Ctrs.,
358 N.L.R.B. at 707 (citing Frito-Lay, 243 N.L.R.B. at 144). The
Board had held that so long as a union’s authorization cards
provided a window period before the expiration of a collective
bargaining agreement, employees did not have an additional
right to revoke their authorization at the termination of the
agreement. See Frito-Lay, 243 N.L.R.B. at 138.
1
The Board adopted the ALJ’s dismissal of the complaint. It
implicitly recognized that the authorization cards were ambiguous by
noting that “the Acting General Counsel does not contest the facial
validity of the Respondent Union’s standard dues-checkoff
authorization agreement.” Smith’s Food & Drug Ctrs., 358 N.L.R.B. at
704 n.2.
5
The Board in Frito-Lay – as it does before us – read the
crucial language in section 302 giving an employee a right to
revoke a checkoff authorization “beyond the termination of the
applicable collective bargaining agreement” as satisfied by
giving employees a window period before the termination of an
applicable agreement. See id. The difference between a right to
revoke during a limited pre-termination window and a right to
revoke at will upon termination of an agreement is not an
insignificant difference. Employees might well decide to revoke
their authorizations, as in this case, only after termination of an
applicable agreement, because of the then-existing
unsatisfactory status of relations between the union and
employer.
The Board has a rather peculiar position regarding the legal
effect of section 302(c)(4) on its application of the National
Labor Relations Act. It recognizes that illegal checkoffs – i.e.,
payments to the union without employee authorization – would
violate section 8 of the Act. See, e.g., id. at 137. But in
deciding whether a checkoff authorization with a window period
before termination of a contract satisfies section 302(c)(4), it
does not consider itself actually bound by section 302 – though
even the Board does not claim it may ignore section 302
completely. See id. at 138 (quoting Salant & Salant, Inc., 88
N.L.R.B. 816, 817-18 (1950)).
I think that it is an untenable position. Section 302 clearly
represents Congressional policy on the legality of checkoff
authorizations, even though it is expressed in a companion
criminal statue. In an analogous case, the Supreme Court
rejected an interpretation of the Sherman Act in a criminal
proceeding because it was in tension with a later civil statute, the
Norris-LaGuardia Act. See United States v. Hutcheson, 312
U.S. 219, 231-35 (1941). The Court reasoned that Congress had
6
expressed its policy view as to the legality of a union’s conduct
in the Norris-LaGuardia Act. Here too, the interplay between
the criminal and civil provisions of related statutes means there
must be a consistent understanding as to which checkoff
practices are lawful and which are not, or else employers are
exposed to conflicting obligations. The Board’s interpretation
of section 8 of the NLRA cannot be in direct opposition to
section 302’s criminal prohibition. See BASF Wyandotte Corp.,
274 N.L.R.B. 978, 979 (1985), enf’d, 798 F.2d 849 (5th Cir. 1986).
Even assuming that section 302 does affect the proper
interpretation of the NLRA, the Board argues that it is entitled
to deference when it “looks” at section 302 and determines how
it fits into that statute. Of course, it is axiomatic that the Board
does get deference when it interprets ambiguous language in the
NLRA under Chevron. See, e.g., Lechmere, Inc. v. NLRB, 502
U.S. 527, 536 (1992). That deference flows from Congress’s
delegation to the Board to enforce that Act. But it is also a
fundamental principle of administrative law that an agency does
not get deference interpreting a statute if another body has
responsibility to interpret the same language. See Collins v.
Nat’l Transp. Safety Bd., 351 F.3d 1246, 1253 (D.C. Cir. 2003);
Wachtel v. Office of Thrift Supervision, 982 F.2d 581, 585 (D.C.
Cir. 1993). That is particularly true if the other body is a federal
court. Cf. Litton Fin. Printing v. NLRB, 501 U.S. 190, 202-03
(1991) (citing Local Union 1395, Int’l Bhd. of Elec. Workers v.
NLRB, 797 F.2d 1027, 1030-31 (D.C. Cir. 1986)).
Moreover, there is yet another reason for withholding
deference in this case. After all, section 302 creates criminal
liability. See NLRB v. Oklahoma Fixture Co., 332 F.3d 1284,
1291 (10th Cir. 2003) (Briscoe, J., concurring). See generally
Esquivel-Quintana v. Lynch, 810 F.3d 1019, 1027 (6th Cir.
2016) (Sutton, J., concurring in part and dissenting in part), cert.
7
granted, 137 S. Ct. 368 (2016). To be sure, the Justice
Department has not so far prosecuted an employer or union for
refusing to permit an employee to revoke an authorization at the
termination of an “applicable contract” if the contract contained
a window period, but that is a matter of prosecutorial discretion
and certainly does not bind an existing or future Justice
Department.
That brings me to the merits of the statutory interpretation
question, and I do not regard it as difficult. The Board adopts an
anti-textual interpretation of the phrase, “beyond the
termination.” It essentially claims that “beyond” can mean
“before”; if an employee’s authorization card conferred a
window period in which to revoke authorization before the
termination date and he or she does not revoke, he or she has
forfeited the right after termination of the contract. In this case,
that means petitioners who sought to revoke their authorization
during the hiatus period after termination of the applicable
agreement in October 2008 were not entitled to revoke, and
therefore Fry’s and Local 99 did not commit an unfair labor
practice by refusing to accept revocations submitted during that
period. I think the Board’s interpretation of section 302 is flatly
wrong, as have other courts that have considered the issue.2 The
Board has engaged in a blatant attempt to rewrite a statute in
which Congress spoke plainly – at least on the crucial issue.
2
See Anheuser-Busch, Inc. v. Int’l Bhd. of Teamsters, 584 F.2d
41, 43 (4th Cir. 1978); Murtha v. Pet Dairy Products Co., 314 S.W.2d
185, 190 (Tenn. 1957). Associated Press v. NLRB, 492 F.2d 662
(D.C. Cir. 1974), is not to the contrary. In that case, we did not
interpret section 302(c)(4) but simply affirmed the Board’s deferral to
an arbitrator. Id. at 667.