Asociacion Hospital Del Maestro, Inc.

ASOCIACION HOSPITAL DEL MAESTRO 401 Asociacion Hospital del Maestro , Inc. and Union de Trabajadores de la Industria Gastronomica de Puerto Rico, Local 610, Hotel Employees and Restaurant Employees International Union, AFL-CIO. Case 24-CA-5110 22 April 1986 DECISION AND ORDER BY MEMBERS DENNIS, BABSON, AND STEPHENS On 20 September 1985 Administrative Law Judge Thomas R. Wilks issued the attached deci- sion. The General Counsel filed exceptions and a supporting brief. The National Labor Relations Board has delegat- ed 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 brief and has decided to affirm the judge's rulings, findings, and conclusions i and to adopt the recommended Order. ORDER The recommended Order of the administrative law judge is adopted and the complaint is dis- missed. ' We agree with the judge that raising an arbitrability defense before an arbitrator does not constitute a refusal to arbitrate Consequently, we need not pass on the judge's discussion of whether the Respondent's duty to arbitrate survives the collective-bargaining agreement's expiration Antonio F. Santos, Esq., for the General Counsel. Roberto E. Vega-Pacheco, Esq. (Cancio, Nadal & Rivera), of Hato Rey, Puerto Rico, for the Respondent. Valentin Hernandez, of Santurce, Puerto Rico, for the Union. DECISION STATEMENT OF THE CASE THOMAS R WILKS, Administrative Law Judge. This case was tried at Hato Rey, Puerto Rico, on 18 June 1985 The unfair labor practice charge was filed by Union de Trabajadores de la Industria Gastronomica de Puerto Rico, Local 610, Hotel and Restaurant Employ- ees International Union , AFL-CIO (Union), against the Asociacion Hospital del Maestro, Inc. (Respondent). The complaint in Cases 24-CA-5066 and 24-CA-5069 was issued by the Regional Director for Region 24 on 25 Jan- uary 1985. In Case 24-CA-5110 a complaint was issued on 22 April 1985 and consolidated with the outstanding complaint. On 18 June 1985 the Regional Director issued an order severing and postponing Cases 24-CA-5066 and 24-CA-5064. The complaint in Case 24-CA-5110 alleges that the Respondent violated Section 8(a)(1) and (5) of the Act by refusing to arbitrate grievances filed after the expiration of the collective-bargaining agreements. Respondent in its answer denied paragraph 8 of the consolidated complaint which contained the refusal to arbitrate allegations. Respondent, in its affirmative de- fense in the answer, admitted that it had informed the Union during contract bargaining that it "would no longer be bound" by the terms of the contract including the arbitration provision. Respondent contends that arbi- tration is consensual and only binding during the life of the contract which set forth that obligation. Respondent argues that it is free to disavow the contractual arbitra- tion obligation. At the trial the parties submitted into evidence a joint stipulation of facts and joint exhibits. The record there- fore consists of undisputed evidence. Counsel for the General Counsel argued orally at the trial. Respondent filed a brief which was timely received in Washington, D.C., but which was misdirected and not received by me until 19 August 1985. On the entire record of the case, I make the following FINDINGS OF FACT I. THE BUSINESS OF THE EMPLOYER Respondent is a corporation duly organized under the laws of the Commonwealth of Puerto Rico, engaged in the business of providing medical services. Respondent annually imports goods and supplies in excess of $50,000 from points outside the Commonwealth of Puerto Rico. It is admitted, and I find, that Respondent has been at all times material, an employer engaged in commerce within the meaning of Section 2(6) and (7) of the Act. II. THE LABOR ORGANIZATION It is admitted, and I find that the Union is, and has been at all times material, a labor organization within the meaning of Section 2(5) of the Act. III. THE ALLEGED UNFAIR LABOR PRACTICES A. Facts Since August 1981 the Union has been the duly desig- nated collective-bargaining agent for an appropriate bar- gaining unit of certain of Respondent's office clerical em- ployees. The parties have maintained a collective-bar- gaining agreement covering the bargaining unit, effective from 1 March 1982 until 30 September 1984. On 18 June 1984 the Union notified Respondent that it desired to negotiate a new contract inasmuch as the cur- rent contract was due to expire. On 2 October 1984 the parties held their first bargain- ing session during which the Union requested additional benefits and salary increases. During that meeting Re- spondent rejected the requests and also refused the Union's request to extend the contract for 30 days. Re- spondent reiterated its position with respect to nonexten- sion of the contract at the second negotiation session on 10 October 1984. In response, the Union took the posi- tion that since the contract would not be extended, ac- cordingly the no-strike clause of the contract would also 279 NLRB No. 62 402 DECISIONS OF NATIONAL LABOR RELATIONS BOARD not be extended. Respondent assured the Union that it would not unilaterally modify any term or condition of employment as required by law. After the contract expired, Respondent met with the Union to discuss grievances which arose subsequent to the expiration of the contract. The first grievance had its genesis with a 13 September 1984 written request for a promotion by employee Arlene Freyre alleged to be due under the seniority provision of the contract. The second grievance arose on Respondent's 26 `November 1984 written notification to the Union of its intention to seek approval, from the Secretary of Labor and Human Re- sources of Puerto Rico, to be excused from payment of the Christmas bonus which was alleged to be due to the employees under the terms of the contract and also ac- cording to civil law. The Respondent, by letter dated 10 December to the Union, announced that it intended to pay the employees a Christmas bonus which the Union contends is substantially less than the amount that was due under the contract. The third grievance involved the discharge of Hipolito Diaz on 17 November 1984. The fourth grievance involved a claim for payment of incen- tive days allegedly due under the contract for unused sick leave on behalf of employees Hipolito Diaz and Efrain Reyes for which an arbitration demand was made on 25 January 1985. On 25 January 1985, employee Raul Segarra was suspended for 5 days and the fifth grievance over the suspension was thereafter filed. The parties met and discussed grievances arising after the contract's expi- ration. The Union requested arbitration for all these griev- ances. In the "arbitration processes" of the first four grievances the Respondent asserted an affirmative de- fense that the arbitrators lacked jurisdiction because the contract had expired and, therefore, there was no con- tractual obligation to arbitrate. Arbitrators held hearings on the Christmas bonus and Diaz discharge grievances on 20 March 1985 and 3 April 1985, respectively. Re- spondent participated in those hearings where it set forth its argument on nonarbitrability. That position is identi- cal to its position herein. The arbitrability, i.e., jurisdic- tional question, was considered by the arbitrators. The arbitrators concurred with the Respondent that there was a lack of jurisdiction. One arbitrator cited the con- tract expiration as the cause for a lack of jurisdiction while the other arbitrator, in considering the Christmas bonus grievance, denied jurisdiction because the amount in controversy exceeded a maximum amount set forth under the contract in reference to salary claims. The Union then filed an unfair labor practice complaint alleg- ing that the Respondent violated Section 8(a)(1) and (5) of the Act by refusing to arbitrate the grievances and thus engaged in bad-faith bargaining. The stipulated facts do not reveal that Respondent refused to arbitrate all these grievances. Rather, it is stipulated that Respondent in the arbitration processes of the first four grievances "asserted as an affirmative defense lack of jurisdiction based upon contract expiration." Two of those griev- ances have actually proceeded to arbitration hearings. B. Conclusions The law has been firmly established since 1977 that "the parties' obligations under the arbitration clause sur- vives contract termination when the dispute is over an obligation arguably created by the expired agreement." Nolde Bros. v. Bakery Workers Local 358, 430 U.S. 243, 256 (1971). The Supreme Court continued, stating, "the presumptions favoring arbitrability must be negated ex- pressly or by clear implication." In order to satisfy the Nolde standard, the basis of the grievances must be ex- plored to determine if the origin of the grievances is the expired contract, i.e., whether or not there was a breach of an obligation arguably arising from the contract. The Christmas bonus grievance has its basis in article XX of the contract which sets the amount of the bonus and the date for payment. The payment for the incentive days has its origins in article XI which deals with sick leave and the compensation for unused sick leave. These benefits arguably accrued on services rendered during the terms of the contract. Respondent has a duty to arbi- trate disputes concerning benefits accrued under the con- tract. Steiner Trucraft, 237 NLRB 1079, 1081 (1978). Arlene Freyre's promotion grievance relates to article IX and is premised on seniority which arguably accrued during the term of the contract. Also, the grievance arose in consequence of a claim made on 13 September 1984, 2 weeks before the contract expiration. When con- duct which gives rise to the grievance occurs before the expiration of the contract, in the absence of contrary in- dication of the parties, there is a clear duty to arbitrate even if the grievance procedure was instituted after the contract expiration. Digmor Equipment & Co., 261 NLRB 1175 (1982). The grievances involving Diaz' discharge and Segar- ra's suspension are of a somewhat different nature. In American Sink Top Co, 242 NLRB 408 (1979), on which the General Counsel relies, the Board citing the Nolde decision, found that a contractual arbitration obli- gation survived contract expiration with respect to a dis- pute over the discharge of an employee which occurred almost 2 months after the expiration date. The facts of that case do not clearly reveal whether or not the termi- nation was caused by precontract expiration conduct. The facts merely disclose that the terminated employee, having sustained an injury several months prior to the discharge, had not been on the active payroll for that length of time. I must conclude that the Board did not view as relevant the date of the conduct. Furthermore, the specific basis for the termination was not revealed in the record to be for misconduct of the employee either during or after the contract term. The judge referred to a "termination." The Board, without explication, referred to "discharge." In the Digmor decision, supra at 1175, the Board's review of the state of the Board law was as follows: The Board has held that, following the expiration of a collective-bargaining agreement, an employer must continue to bargain with a union over terms and conditions of employment, and must adhere to the contractual grievance procedure. And, in Amen- ASOCIACION HOSPITAL DEL MAESTRO can Sink Top & Cabinet Co., Inc., 242 NLRB 408 (1979), relying on Nolde Brothers, Inc. v. Local 358, Bakery & Confectionery Workers Union, AFL-CIO, 430 U.S. 243 (1977), the Board held that, where parties to a collective-bargaining agreement have agreed to subject certain matters to grievance and arbitration, the parties' duty to arbitrate survives the termination of the contract when the dispute is over an obligation arguably created by the expired agree- ment The Digmor case involved an expired contract which contained a provision governing employee discharge and also a grievance-arbitration proviso covering disputes over "matters provided for" in the contract. A grievance was filed after the term of the contract which involved a dispute over the propriety of an employee discharge based, in part, on conduct of the employee during the term of the contract. The Board quoting and holding ap- plicable American Sink, supra, stated: The grievance's basis is "arguably"-at least-the contract, and there is no reason to conclude that the parties had intended the arbitration to end with the contract's term. [242 NLRB at 408.] The Board found that the evidence failed to establish that "the parties did not intend the arbitration provisions to survive the expiration of the contract." The majority opinion, in the recitation of facts, noted that the conduct for which the employee was discharged "occurred-or at least, began- while the collective bargaining agree- ment was still in effect." The Board opinion did not dis- cuss the significance of that observation . In his concur- ring opinion, however, Chairman Van De Water placed the utmost significance on it, and went so far as to state that he would not hold arbitrable a discharge based on postcontract term conduct and stated: To the extent that American Sink, because of its fac- tual ambiguities is construed as reaching a contrary conclusion, I do not approve or accept that deci- sion [261 NLRB at 1177, footnotes omitted.] There was no dissenting opinion of the four -member panel. Clearly the majority opinion in Digmor did not reject American Sink with respect to its susceptibility of interpretation, as did Chairman Van De Water. The Board's reference to conduct of the employee during the term of the contract amounts, at most , to an implicit statement that it need not address the potential issue, as discussed by Chairman Van De Water. Thus, the Board did not take the occasion to explicitly limit American Sink as Chairman Van De Water had done . I therefore am unable to conclude that with respect to discharge grievances , the conduct of the employee on which the discharge is premised must have occurred in whole or part prior to the expiration . Rather, I conclude that the rationale of American Sink , in reliance on Nolde, is that if the parties have addressed certain matters in the contract and have agreed to submit disputes arising from those matters to arbitration, then compulsory arbitrability sur- vives, absent contrary intention . In other words, the con- tract terms have set into operation certain conditions of 403 employment. Disputes over the contract's term's oper- ations had been agreed to be resolved by arbitration during the life of the contract . It is a rebuttable presump- tion that the parties intended disputes over the expired contract's term's operations, now a surviving condition of employment, to be resolved in the same manner. Under such rationale , it is immaterial, whether the em- ployee's conduct occurred after the contract term, be- cause the condition of employment , as prescribed by the contract, survives. Thus the obligation created by the contract survives, and a dispute over that obligation is, in essence, a dispute over a contractually created obligation which, it is presumed, was intended to be resolved by ar- bitration. In the instant case, article XIII of the expired contract explicitly incorporated disputes over disciplinary matters, as part of the subject matter agreed to be submitted to the grievance-arbitration procedure. There is no lan- guage in that article , nor in any of the other articles sub- mitted into evidence , that is susceptible to an interpreta- tion that the parties intended that arbitration not survive the contract term. Respondent contends that even though the grievances might have their basis in the contract , the parties intend- ed the grievance procedure to end with the term of the contract so there is no duty to arbitrate . Respondent maintains that because it reiterated numerous times that the contract would not be extended , the intent that the arbitration clause was to end is clearly established. For support of its position Respondent cites Cardinal Operat- ing, 246 NLRB 279 (1979). That case is factually distin- guishable from the present case The parties in Cardinal Operating clearly stated they would not arbitrate any grievances . In the present case, Respondent stated that the contract would not be extended . Respondent's state- ment herein is too ambiguous to be considered a clear in- dication of the intent not to arbitrate and, if anything, constitutes nothing more than a desire to allow the con- tract to expire while negotiations proceed concerning modifications, if any, to the terms and conditions of em- ployment set by the old contract . Respondent recognized that those terms and conditions would not be changed unilaterally in the absence of bargaining to impasse in good faith. Respondent also argues that, in any event , the parties did bargain to impasse . It reached that conclusion on the fact that the Union requested and it refused to extend the contract . Such a scenerio is a grossly insufficient basis to postulate bargaining to impasse . Even had adequate bar- gaining transpired over the duration of the old contract, an impasse on that issue could not form the basis to allow Respondent to implement unilaterally its last offer regarding all other contractual matters, assuming, which is not the case, that there is evidence that such a last offer was made concerning grievances , arbitration, disci- pline, etc. There is no evidence of any bargaining with respect to grievance procedures and no evidence that either party desired any change in that procedure. The balance of Respondent's arguments about the non- survival of obligatory arbitration , in essence, ran to the wisdom of the Board's decision in American Sink Top, 404 DECISIONS OF NATIONAL LABOR RELATIONS BOARD and to its interpretation of Nolde. I can only apply Board law as it stands. Respondent also asserts in its brief that "notwithstand- ing" its position with respect to arbitration survival, it had in fact proceeded to arbitration on all occasions when requested to do so by the Union. Respondent does not expand on this assertion nor does it comment on its implications. I find that in effect the issue litigated here is identical to what which was submitted to arbitration. Conclusion I conclude that Respondent was under a duty to adhere to the prevailing arbitration provision as estab- lished by the expired collective-bargaining agreement. Therefore, had Respondent unilaterally disavowed the continuing operation of that provision by refusing to ar- bitrate grievances filed by the Union, it would have breached its statutory duties. However, the facts do not establish that Respondent refused to arbitrate the griev- ances, but merely that Respondent raised the issue of ar- bitrability during the arbitration process, to which it had submitted. The General Counsel appears to argue that the raising of such defense is tantamount to a refusal to arbitrate. I do not agree. The facts establish that four of the grievances were submitted to the arbitration process. There is no evidence that Respondent does not intend to comply with an adverse arbitration decision. I conclude that a remedial Order prohibiting Respondent from rais- ing the issue of arbitrability before the arbitrator would contravene the Board's policy to favor and defer to vol- untary arbitration as expressed in United Technologies Corp., 268 NLRB 557 (1984). With respect to the fifth grievance concerning the Se- garra suspension, the General Counsel has not proven that Respondent had, in fact, refused to proceed to arbi- tration. Respondent had not admitted that it refused to submit the issue of arbitrability to arbitration. Thus, with respect to the Segarra grievance, the operative facts of paragraph 8 of the consolidated complaint, which were denied by Respondent, have not been proven. Accordingly, I conclude that the entire case is without merit and I recommend the following i ORDER The entire complaint is dismissed in its entirety. ' If no exceptions are filed as provided by Sec 102 46 of the Board's Rules and Regulations, the findings, conclusions, and recommended Order shall, as provided in Sec 102 48 of the Rules, be adopted by the Board and all objections to them shall be deemed waived for all pur- poses