09-0217-ag
NLRB v. Iovine
                          UNITED STATES COURT OF APPEALS
                              FOR THE SECOND CIRCUIT

                                        SUMMARY ORDER
RULINGS BY SUM M ARY ORDER DO NOT HAVE PRECEDENTIAL EFFECT. CITATION TO A
SUM M ARY ORDER FILED ON OR AFTER JANUARY 1, 2007, IS PERM ITTED AND IS GOVERNED BY
FEDERAL RULE OF APPELLATE PROCEDURE 32.1 AND THIS COURT'S LOCAL RULE 32.1.1. W HEN
CITING A SUM M ARY ORDER IN A DOCUM ENT FILED W ITH THIS COURT, A PARTY M UST CITE
EITHER THE FEDERAL APPENDIX OR AN ELECTRONIC DATABASE (W ITH THE NOTATION
"SUM M ARY ORDER"). A PARTY CITING A SUM M ARY ORDER M UST SERVE A COPY OF IT ON ANY
PARTY NOT REPRESENTED BY COUNSEL.


       At a stated term of the United States Court of Appeals for the Second Circuit, held
at the Daniel Patrick Moynihan United States Courthouse, 500 Pearl Street, in the City of
New York, on the 30 th day of March, two thousand ten.

PRESENT:         ROBERT D. SACK,
                 REENA RAGGI,
                 PETER W. HALL,
                                          Circuit Judges.
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NATIONAL LABOR RELATIONS BOARD,
                                          Petitioner,
                         v.                                            No. 09-0217-ag

EUGENE IOVINE, INC.,
                                          Respondent.
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APPEARING FOR PETITIONER:                         ELIZABETH A. HEANEY (Ronald Meisburg,
                                                  General Counsel, John E. Higgins, Jr., Deputy
                                                  General Counsel, John H. Ferguson, Associate
                                                  General Counsel, Linda Dreeben, Deputy
                                                  Associate General Counsel, Meredith Jason,
                                                  Supervisory Attorney, on the brief), National
                                                  Labor Relations Board, Washington, D.C.

APPEARING FOR RESPONDENT:                         ROGER S. KAPLAN (Steven S. Goodman, on
                                                  the brief), Jackson Lewis LLP, Melville, New
                                                  York.
       UPON DUE CONSIDERATION, IT IS HEREBY ORDERED, ADJUDGED, AND

DECREED that the National Labor Relations Board’s petition for enforcement is

GRANTED.

       The National Labor Relations Board (“Board” or “NLRB”) petitions for enforcement

of its September 30, 2008 order ruling that respondent Eugene Iovine, Inc. (“Iovine”),

violated sections 8(a)(1) and (5) of the National Labor Relations Act (the “NLRA” or “Act”),

29 U.S.C. §§ 158(a)(1), (5), by unilaterally firing employees without first providing their

union with timely notice and an opportunity to bargain over the layoffs. Iovine, an electrical

contractor, opposes enforcement on the grounds that the Board (1) had no authority to decide

the case because it lacked a quorum; (2) irrationally ignored evidence of Iovine’s past

practice of notifying an employee benefit fund following layoffs; (3) erred, in any event, in

concluding that Iovine failed to provide timely notice to the union; and (4) imposed an

arbitrary remedial order unwarranted by the alleged violation. We assume the parties’

familiarity with the facts and record of prior proceedings, which we reference only as

necessary to explain our decision to grant the Board’s petition.

       1.     Standards and Scope of Review

       Under our highly deferential review of NLRB orders, see International Union, United

Auto., Aerospace, and Agric. Implement Workers of Am. v. NLRB, 520 F.3d 192, 196 (2d

Cir. 2008), we uphold the Board’s findings of fact “if supported by substantial evidence and



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[its] legal determinations if not arbitrary and capricious,” Cibao Meat Prods., Inc. v. NLRB,

547 F.3d 336, 339 (2d Cir. 2008) (internal quotation marks omitted). Congress has delegated

to the Board primary responsibility for determining the scope of an employer’s statutory duty

to bargain, and we will affirm the Board’s statutory construction so long as it is “reasonably

defensible.” Ford Motor Co. v. NLRB, 441 U.S. 488, 497 (1979); see also NLRB v. Town

& Country Elec., Inc., 516 U.S. 85, 89-90 (1995) (observing that we afford “a degree of legal

leeway” to Board interpretations of NLRA).

       Because the Board adopted the ALJ’s findings of fact and conclusions of law in part,

we review both the ALJ’s opinion and the Board’s. See NLRB v. Special Touch Home Care

Servs., Inc., 566 F.3d 292, 297 (2d Cir. 2009).

       2.     Quorum Challenge

       Iovine’s argument that the Board lacked the quorum necessary to issue a valid order

is foreclosed by Snell Island SNF LLC v. NLRB, 568 F.3d 410 (2d Cir. 2009), in which this

court held that two members of the Board may issue enforceable decisions. Here, as in Snell,

two active Board members issued the challenged order, acting as a quorum of the

three-member group to which the Board had previously delegated all of its powers, as

permitted by the Act. See 29 U.S.C. § 153(b). Accordingly, we consider the merits of the

Board’s petition.




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       3.     The Alleged Violation and Iovine’s Defenses

              a.      The Duty to Bargain

       It is well-established that where, as here, an employer and a representative union are

negotiating toward a collective bargaining agreement pursuant to section 8(a)(5) of the

NLRA, the employer may not “alter terms and conditions of employment without first giving

notice to and conferring in good faith with the union.” Firch Baking Co. v. NLRB, 479 F.2d

732, 735 (2d Cir. 1973). Such unilateral action “amount[s] to a refusal to negotiate about the

affected conditions of employment under negotiation, and must of necessity obstruct

bargaining, contrary to the congressional policy.” NLRB v. Katz, 369 U.S. 736, 747 (1962);

see also Olivetti Office U.S.A., Inc. v. NLRB, 926 F.2d 181, 186 (2d Cir. 1991) (observing

that economically motivated action by employer that does not cause “change in basic

business operations . . . is subject to mandatory bargaining”); In re Tri-Tech Servs., Inc., 340

N.L.R.B. 894, 894 (2003) (“It is well established that the layoff of unit employees is a change

in terms and conditions of employment over which an employer must bargain.”).

              b.      Past Practice Exception

       Iovine submits that the Board irrationally rejected its argument that an established

practice of notifying a benefit fund administrator following layoffs relieved it of any

obligation to provide advance notice to the Union. See The Courier-Journal, 342 N.L.R.B.

1093, 1094 (2004) (observing that “unilateral change made pursuant to a longstanding



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practice is essentially a continuation of the status quo – not a violation of Section 8(a)(5)”).

We disagree. The Board concluded that “[a]bsent evidence of when or how frequently or

under what circumstances the asserted unilateral layoffs occurred,” Eugene Iovine, Inc., 353

N.L.R.B. No. 36, slip op. at 1 (Sept. 30, 2008), vague testimony from Iovine’s president that

the practice was in place from 1971 to 1998 was insufficient to demonstrate that “employees

could reasonably expect [it] to continue or reoccur on a regular and consistent basis,”

Sunoco, Inc., 349 N.L.R.B. 240, 244 (2007). This conclusion, grounded in the record, cannot

be deemed irrational. See Salmon Run Shopping Ctr. LLC v. NLRB, 534 F.3d 108, 113 (2d

Cir. 2008) (observing that reversal based on factual findings is warranted only if “no rational

trier of fact could reach the conclusion drawn by the Board” (internal quotation marks

omitted)).

              c.      Timely Notice and Economic Necessity

       Iovine next submits that the notice it provided, generally within a week of each layoff,

was sufficient to meet its obligations under the Act in light of the exigent circumstances

beyond its control that caused the layoffs – specifically, inclement weather or last-minute

logistical problems precluding electrical work at a given job site and requiring prompt action

lest workers sit idle at high cost to the company. We are not persuaded. First, “[t]o be

timely, the notice must be given sufficiently in advance of actual implementation of the

change to allow a reasonable opportunity to bargain.” Ciba-Geigy Pharms. Div., 264



                                               5
    N.L.R.B. 1013, 1017 (1982); see also In re Pontiac Osteopathic Hosp. & Int’l Union, 336

    N.L.R.B. 1021, 1023 (2001) (observing that notice must be provided under circumstances

    allowing “reasonable opportunity for counter arguments or proposals” (internal quotation

    marks omitted)). No such advance notice was provided in this case. Further, the business

    emergency exception to the Act’s bar against unilateral employment action is limited to

    “extraordinary events,” and, “[a]bsent a dire financial emergency, . . . economic events such

    as loss of significant accounts or contracts, operation at a competitive disadvantage, or supply

    shortages do not justify unilateral action.” Cibao Meat Prods., Inc. v. NLRB, 547 F.3d at 340

    (internal quotation marks omitted); see also Duffy Tool & Stamping, L.L.C. v. NLRB, 233

    F.3d 995, 997 (7th Cir. 2000) (describing exception as requiring immediate action to “stave

    off disaster”). The record reveals no such extraordinary event or imminent disaster in this

    case.1

             Accordingly, we conclude that the Board reasonably determined that Iovine violated

    sections 8(a)(1) and (5) of the Act by failing to provide adequate notice and an opportunity

    to bargain over the challenged layoffs.



             1
1            While Iovine was not relieved of its duty to provide adequate notice and an
2   opportunity to bargain, employers facing circumstances such as those at issue here are not
3   without recourse. Where exigent circumstances fall short of dire emergency but nevertheless
4   require prompt action, “the amount of time and discussion required to meet a bargaining
5   obligation” varies depending on the context. RBE Elecs. of S.D., Inc., 320 N.L.R.B. 80, 82
6   (1995). Unilateral action is permitted once the parties reach impasse, and bargaining “need
7   not be protracted.” Id.

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         4.    The Remedial Order

         Finally, Iovine submits that the Board’s remedial order awarding back pay and

reinstatement was unwarranted. We will overturn a remedy imposed by the Board only

where it is proven to be “a patent attempt to achieve ends other than those which can fairly

be said to effectuate the policies of the Act.” NLRB v. Fugazy Cont’l Corp., 817 F.2d 979,

982 (2d Cir. 1987) (quoting Virginia Elec. & Power Co. v. NLRB, 319 U.S. 533, 540

(1943)). We detect no departure from the purposes of the Act in the Board’s order that

Iovine compensate fired employees for earnings and other benefits lost as a result of the

unlawful layoffs. See, e.g., NLRB v. Mastro Plastics Corp., 354 F.2d 170, 175 (2d Cir.

1965).

         We have considered all of Iovine’s remaining arguments in opposition to the Board’s

petition and conclude that they are without merit. Accordingly, we GRANT the NLRB’s

application for enforcement of its September 30, 2008 order.

                                    FOR THE COURT:
                                    CATHERINE O’HAGAN WOLFE, Clerk of Court




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