Pacific Coast Metal Trades District Council

PACIFIC COAST METAL TRADES COUNCIL (LOCKHEED SHIPBUILDING) Pacific Coast Metal Trades District Council and Lockheed , Shipbuilding Company. Case 19-CB- 5607 21 November 1986 DECISION AND ORDER CHAIRMAN DOTSON AND MEMBERS JOHANSEN, AND STEPHENS On 20 June 1986 Administrative Law Judge Clif- ford H. Anderson issued the attached decision. The General Counsel and the Charging Party each filed exceptions and a supporting brief, and the Re- spondent filed cross-exceptions and a brief, support- ing its cross-exceptions and opposing the General Counsel's exceptions. 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, cross-exceptions, and briefs and has decided to affirm the judge's rul- ings, findings, 2 and conclusions and to adopt the recommended Order. ORDER The recommended Order of the administrative law judge is adopted and the complaint is dis- missed. i In sec. III,A of his decision, the judge erroneously refers to a letter of 26 September 1985 that actually was written by Clarence Briggs (for the Respondent) as a letter written by Hayes (of Lockheed). This mad- vertent error does not affect the decision in this case 2 We agree with the judge that this case should not be deferred to the contractual grievance and arbitration procedure for the reasons stated in his decision. We note also that the actions that culminated in these pro- ceedings began when Lockheed, pursuant to a previous Board order, contacted Locals 46 and 104 for the purpose of bargaining over its pro- posed medical screening program See Lockheed Shipbuilding, Co., 273 NLRB 171 (1984). When compliance with a Board order is at issue, de- ferral is inappropriate. Ernst Steel Corp, 217 NLRB 1069 fn. 1 (1975). In finding that the parties did not intend to be bound by the July 19 agreement until that agreement was approved by Locals 46 and 104, the judge did not consider that the 1983-1986 collective-bargaining agree- ment arguably designates the Respondent as the exclusive representative for all the signatory unions for purposes of bargaining with Lockheed. Both the General Counsel and Lockheed assert that the judge thus erred in failing to find that the Respondent, through its subcommittee, had the authority to bind Locals 46 and 104 to the terms of the July 19 agree- ment That assertion, even if accurate, is not determinative Whether or not the Respondent had the authority to reach an agreement that would have bound the two locals, the judge found, based on the actions of all the parties, that Respondent did not intend to reach a binding agreement without the locals' consent. Because he found that the Respondent's ne- gotiators did not intend to bind Locals 46 and 104 at the July 19 session, the judge did'not have to decide whether the subcommittee had the au- thority,to do so. Eduardo Escamilla, Esq., for the General Counsel. David A. Rosenfeld, Esq. (Van Bourg, Weinberg, Roger & Rosenfeld), of San Francisco, California, for Respond- ent. 239 William T. Grimm, Esq., of Seattle, Washington, appear- ing for the Charging Party. DECISION STATEMENT OF THE CASE CLIFFORD H. ANDERSON, Administrative Law Judge. This case was tried before me on 14 January 1986, pursu- ant to a complaint and notice of hearing issued by the Regional Director for Region 19 of the National Labor Relations Board on 16 October 1985, and amended on 25 October 1985, based on a charge filed on 10 September 1985 and amended on 12 September 1985 by Lockheed Shipbuilding Company ,(the Charging Party, Lockheed, or the Employer) against Pacific Coast Metal Trades District Council (Respondezit).1 The amended complaint as further amended orally at the hearing alleges that the Charging Party and Re- spondent about 19 July 1985 reached full and complete agreement with respect to a modification of their collec- tive-bargaining agreement concerning utilization of medi- cal screening of unit employees and that since about 5 September 1985 Respondent has failed and refused to execute a midterm contract modification containing the agreed-on terms, thereby violating Section 8(b)(3) of the National Labor Relations Act (Act). Respondent does not contest that" its agents entered into an agreement about 19 July 1985, but contends that that agreement was not final, and was conditioned on subsequent review and ratification procedures. Those procedures resulted in a rejection of the agreement. Thus, Respondent contends that it was at no time bound to sign any purported final agreement and thus has not violated the Act. All parties were given full opportunity to participate at the hearing, to introduce relevant evidence,2 to exam- 1 The original complaint and the amended charge each named as Re- spondents Boilermakers Local 104 (Boilermakers Local 104) and Interna- tional Brotherhood of Electrical Workers Local 46 (Electrical Workers IBEW Local 46 or Local 46). The amended complaint includes these en- tities only as parties in interest. 2 At the hearing, the General Counsel tendered records maintained by the Charging Party concerning both attendance at and discussions held at the bargaining sessions. These were offered as substantive evidence fall- mg within the exception to the hearsay rule incorporated in Fed.R.Evid. 803(6). At the hearing I reserved ruling on the offer. I now receive those records into evidence as tendered. Buffalo Neighborhood Housing Services, 267, NLRB 514 (1983). The General Counsel at the hearing sought to show by stipulation or otherwise that Respondent had not cooperated with the General Counsel during the investigation of the case and had not presented any defense to the allegations against it until the commencement of Respondent's case in chief. The General Counsel offered the facts in support of the argument that Respondent's case must be judged skeptically as one tailormade to address the allegations against it as opposed to a defense that had been revealed before the evidence against Respondent was known by Re- spondent's agents and counsel. I rejected efforts by the General Counsel to adduce such evidence at the hearing and rejected the General Coun- sel's subsequent offer of proof with respect to these facts. I reaffirm my ruling here. It is of course true that evidence of shifting defenses by a parties' re- spondent or admissions made by a respondent's agents during the course of an investigation have been held admissible evidence by the Board with court approval. Applying the simple notion of relevance to the instant offer, perhaps the General Counsel is correct that a defense that is pre- sented for the first time only after the prosecution has rested its case is Continued 282 NLRB No. 41 240 DECISIONS OF NATIONAL LABOR RELATIONS BOARD ine and cross-examine witnesses, to argue orally, and to file posthearing briefs. On the' entire record, including briefs from Respondent and the General Counsel, I make the following3 FINDINGS OF FACT 1. JURISDICTION The Charging Party is a State of Washington corpora- tion with an office and place of business in Seattle, Washington, where it is engaged in the business of oper- ating a shipyard. The Charging Party during the course and conduct of its business operations has annual gross sales of goods and services valued in excess of $500,000, and sells and ships goods and provides services from its facilities within the State of„ Washington to customers outside the State or sells and ships or provides services to customers within the State, which customers are en- gaged in interstate commerce by other than indirect means of a total value in excess of $50,000. Thus, the Charging Party is and has been at all times material an employer engaged in commerce within the meaning of Section 2(2), (6),, and (7) of the Act. II. LABOR ORGANIZATIONS Respondent and the Seattle Metal Trades Council are comprised of various unions, including, but not limited to, Boilermakers Local 104 and Electrical Workers IBEW Local 46 and exist for the purpose, inter alia, of representing constituent union members in collective bar- gaining with various employers, including the Charging Party. Respondent, the Seattle Metal Trades Council, Boilermakers Local 104, and Electrical Workers IBEW Local 46, and each of them, are and have been at all times material labor organizations within the meaning of Section 2(5) of the Act. III. ALLEGED UNFAIR LABOR PRACTICES A. Facts At all material times the Charging Party has recog- nized the Pacific Coast Metal Trades District Council as arguably more suspect than an identical defense that had been raised during the course of an investigation before Respondent was aware of the specifics of the evidence against it Assuming without deciding that this is true, i.e., irrespective of any possible relevance, I find there is a control- ling Board practice that prohibits consideration or even introduction of such evidence into the record. Cooperation by a respondent with the Government during the course of an investigation is normally a volun- tary matter. Were an adverse inference to be drawn against a respondent based on its failure to participate in the pretrial investigation, the concept of "voluntary" participation would be substantially degraded. Such a change in the procedures of the Board should not be undertaken lightly especially by an administative law judge in the absence of Board prece- dent. The General Counsel cited no supporting authority for his argu- ment here. a As a result of pleadings, stipulations, and stipulated exhibits, and the fact that a significant portion of the evidence at the trial was undisputed, the parties substantially reduced the factual issues in contention at the hearing. When not otherwise indicated, the following findings are based on the pleadings, stipulations by counsel at trial, unchallenged credited testimony or documentary evidence, and two earlier Board decisions con- cerning the background events . Lockheed Shipbuilding Co., 273 NLRB 171 (1984) (Lockheed 1), and Lockheed Shipbuilding Co., 278 NLRB 18 (1986) (Lockheed fl). part of a multiunion organization (the Unions) bargaining as a group with Lockheed. For the contract 1 July 1980 through 30 June 1983 the Charging Party was part of a multiemployer group. Thereafter the Employer bar- gained with the Unions as a single employer and those negotiations culiminated in the collective-bargaining agreement ratified on 27 October 1983, which expires by its terms on 30 September 1986. The 1980-1983 contract provided that unit employee- applicants would not be subject to a physical examina- tion except as required by law. Contract language more favorable to the Employer on the question had been pro- posed during negotiations but had been withdrawn in the face of the Union's objections. In the fall of 1980, the Employer proposed to the Unions that certain medical screenings take place among employees but gave assur- ances that the test results would not be used to terminate employment of tested employees. Contrary to the agree- ment the Employer used test results to terminate five em- ployees. These terminations became the subject of unfair labor practice charges filed by Boilermakers Local 104 and Electrical Workers IBEW Local 46. The Board in Lockheed I held the terminations improper and found that the Employer had violated Section 8(a)(5) and (1) of the Act. Three additional employees were tested and denied employment. Those employees became the sub- ject of a second unfair labor practice case. In Lockheed II, the Board again found Respondent was improperly seeking to renege on its contractual commitments in vio- lation of Section 8(a)(5) and (1) of the Act. On 15 February 1985 J. P. Hayes, the Charging Party's vice president of human resources, sent letters with identical text to representatives of each of the two Charging Parties in the Lockheed I case, Joseph H. Pilato, of Boilermakers Local 104's business manager, and William D. Carpine, Electrical Workers IBEW Local 46's secretary-treasurer. The text of each letter stated: On December 10, 1984 the National Labor Rela- tions Board issued its order in the above-referenced case requiring Lockheed to bargain upon request by the unions concerning the "utilization of the medi- cal screening program for the purpose of terminat- ing new employees and/or refusing to hire appli- cants for employment." We notified the local office of ' the NLRB of our willingness to comply with that section of the Order. Two months has passed since the date of the Order and your union has never made such a request. It is our intention to utilize the pulmonary func- tion test results as part of our overall qualifications for continued employment with the Company. An effect of this may be that an employee will not be qualified for any job in the shipyard due to his or her limitations. Based upon your union's failure to request bar- gaining over these effects for the past 2 months, we assume that your union is not interested in pursuing that portion of the Board's order. Should your union fail to make such a request within ten (10) days from the date of this letter, we will conclude PACIFIC COAST METAL TRADES COUNCIL (LOCKHEED SHIPBUILDING) 241 that is the case and will utilize the test results of the above stated manner. In due course both Electrical Workers IBEW Local 104 and Boilermakers Local 46 informed the Charging Party of its willingness to bargain . On 28 February 1985 Hayes sent a letter to Clarence E. Briggs, Respondent's secre- tary-treasurer, with the following text: On February 15, 1985 we wrote to the IBEW Local 46 and the Boilermakers Local 104 discussing the order of the National Labor Relations Board to negotiate over the effects of Lockheed's pulmonary functions screening program. The IBEW responded in writing expressing their willingness to negotiate on the matter. The Boilermakers verbally notified us by telephone earlier this week of their willing- ness to negotiate. (Please see enclosed correspond- ence.) At this time, Lockheed is extending the invi- tation to bargain to all member unions of the Pacific Coast Metal Trades District Council. Please notify us by March 10 if your organization intends to participate in the bargaining. If we do not hear from you by this date, we will assume that your organization is not interested in discussing the effects of the medical screening program. On 5 March 1985 Clarence Briggs wrote the following letter to William Carpine, in his capacity as secretary of the Seattle Metal Trades Council, with a copy to Hayes: Referring to the letter dated February 28, 1985 to this Council from Mr. John Hayes of Lockheed Shipbuilding Company, and enclosing a copy of a letter to you dated February 15, 1985, frankly, this is an issue which falls within the province of the Se- attle Metal Trades Council to process. By copy of this letter, I am alerting all crafts with employees at Lockheed to check with your Council and I do recommend that they participate. Please keep the Council advised of the outcome in this case. On 7 March 1985, Briggs sent a letter to John Hayes. The letter stated in part: In order to attempt to fulfill the order of the NLRB, the District Council has of this date ap- pointed three of our Vice Presidents who reside in your area to be the official committee of the Coun- cil to arrange to meet with your firm and the effect- ed Local Unions for this case only. I appreciate your understanding and please disre- gard my letter dated March 5, 1985 that concerns this case. Developments arose that changed the de- cision as to which of our organization would proc- ess this particular issue. By copy of this letter the Seattle Metal Trades Council is being advised of this decision and procedure. The committee will be, Lee Franklin, Guy Adams and Gene Hintz. Hayes testified that in the telephone conversation re- ferred to in the letter Briggs told Hayes that internal po- litical matters within Respondent required that they par- ticipated in the bargaining rather than the Seattle Metal Trades Council. Briggs did not testify. By letter dated 8 March 1985 to the various local craft unions with a copy to Respondent, Hayes stated: Referencing my letter of February 28, 1985, we inadvertently did not include the correspondence to have been enclosed. Please find attached that sub- ject correspondence including a copy of the NLRB order in question. I have recently been informed that the Pacific Coast Metal Trades District Council will join our negotiations by way of a three person sub-commit- tee tentatively to include Messrs. Franklin, Heintz and Adams, International Representatives of the Boilermakers, Sheet Metal Workers and Carpenters respectively. Once this formal notice is received, we will proceed to establish a date ' to initiate negotia- tions. The initial bargaining session was held on 2 April 1985 near the Seattle-Tacoma Airport. Respondent's designat- ed committee members Franklin, as chairman, and Guy Adams were in attendance, as were numerous representa- tives of various local unions, including William Carpine of Electrical Workers IBEW Local 46 and Joseph H. Pilato of Boilermakers Local 104. The Charging Party was represented by John P. Hayes and Paul Schell, Lockheed's manager of industrial relations. Subsequent sessions were held on 19 April, 17 and 31 May, and 19 July 1985. Management's representatives attended throughout the 'proceedings. Respondent's chairman, Franklin, was present at four of the five bargaining ses- sions. Carpine and Pilato attended three and four sessions as representatives, but neither they nor any other local union representatives attended the final meeting on 19 July. There is no dispute that during the bargaining process the participants narrowed the matters in dispute until, at the meeting of 19 July, the attending conferees agreed that they had no differences remaining concerning the specifics of a modification to the 1983-1986 agreement. There was substantial disagreement, however, regarding what was said at the meeting regarding the authority of Respondent's negotiators, what was said regarding the need for subsequent ratification or approval of the agree- ment once negotiations were concluded, and further dis- agreement about statements characterizing the nature of the agreement reached on 19 July. At the second meeting, on 19 April, Respondent's sub- committee members did not attend. Acting for them was Steve Cuddy, International representative of the Labor- ers Union. Cuddy raised Respondent's negotiating com-, mittee's authority with Hayes suggesting that ' the full District Council's approval was necessary to conclude any agreement reached by the parties. Hayes challenged Cuddy, telling him that Briggs had specifically delegated full bargaining authority to the committee and that ques- tions regarding authority should be raised with the Dis- trict Council .4 4 These findings are based on the unchallenged testimony of Hayes and corroborated by Schell. Cuddy did not testify. 242 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Soon after this meeting, a telephone conversation oc- curred between Schell and Franklin in which the ques- tions raised by Cuddy regarding Respondent's bargaining authority were discussed. Schell testified that he told Franklin that Cuddy was challenging Respondent's com- mittee's authority and that Franklin reasserted that the committee had the authority to negotiate and that- Cuddy was mistaken. Franklin testified that he told Schell that the committee had authority to bargain, subject, howev- er, to final approval of the District Council. The events occurring at the end of the final 19 July bargaining session were in substantial dispute and were closely litigated. Hayes testified that at the conclusion of the session: Adams . . . said, "Okay, we have an agreement," Mr. Cuddy reiterated that and then Mr. Franklin said that believed we had an agreement, but he wanted to give a courtesy review to Mr. Pilato and Carpine, but as far as he was concerned we had an agreement and that he would sign it within one-no more than two weeks, following that July 19, 1985 meeting. On cross-examination, Hayes recalled that though he be- lieved it was Franklin that used the words "courtesy review," he was not sure. He testified he assented to the review because he felt, "I had no-choice." Hayes further recalled that Franklin indicated that he wanted to allow a courtesy review because Carpine and Pilato could not attend that final meeting. Hayes explained: "I could not force them to sign the agreement at that point in time. If [Franklin] wanted to take a week to cover his base with the local people, I certainly accepted it." Schell testified that at the conclusion of the 19 July meeting Guy Adams indicated that they had a "tentative agreement" to which Franklin responded, "[W]e have an agreement, we have a deal." It was determined that Hayes would prepare the final written document reflect- ing the agreement reached. Schell's retyped bargaining notes for 19 July record that Adams stated, "We have reached a tentative agreement." And that Franklin re- sponded, "Yes, with the changes discussed here today, all we have to do is sign it." The notes make no refer- ence to review or subsequent circulation of the written draft. Lee Franklin testified that at the conclusion of the 19 July meeting, Guy Adams made the remark, "[D]o we have a tentative agreement?" and that Franklin respond- ed, "[I]f we can get by our group, we have a deal." Franklin also recalled that immediately after this ex- change the "formality of approval of different bodies" was discussed. Adams recalled that at the conclusion of the 19 July meeting, he asked Lee Franklin if they had a "tentative agreement" and that Franklin responded that, if "it passed our procedures that we go through and is ratified, that we had a deal." Later that same day, 19 July, Hayes mailed to Franklin his written version of the agreement. He also enclosed a cover letter that states in part: Enclosed is the draft of the letter of agreement tentatively accepted by both parties at our bargain- ing session of 19 July 1985. It is our understanding that you wish to allow one more review by the Se- attle Metal Trades Council prior to execution of the final agreement. By copy of this transmittal to W. Carpine, Seattle Metal Trades Council secretary- treasurer, and business agent for Electricians Local 46 and to Joseph Pilato, Seattle Metal Trades Coun- cil president and business agent Boilermakers Local 104, the parties to the NLRB proceedings regarding medical screening have been duly included. -,As discussed, we request your assistance [in] ex- peditiously executing the final and formal agree- ment. Shortly, reduction in force will commence and the issue of medical restrictions in light of avail- able work will surely arise. Apparently Carpine received this 19 July draft from the Charging Party and submitted it to his counsel for review. Counsel Hugh Hafer prepared an opinion letter, dated 7 August 1985, addressed to Carpine in his capac- ity as an Electrical Workers IBEW Local 46 official. The letter, characterizing the, 19 July document as "Lockheed's recent proposal to the Pacific Coast Metal Trades District Council," concluded in part: At most the Employer can arguably insist that the parties reduce to writing any relevant oral agree- ments.... But the Employer cannot compel more The Employer cannot compel the Unions to agree now to its proposal. It cannot unlaterally implement now. To do so is an unfair labor practice and prob- ably a grievable contract violation. Franklin was apparently informed of Carpine's "prob- lem with the recent draft" and wrote both Pilato and Carpine by bookletter dated 16 August that they should comment to him on the matter in writing by 3 Septem- ber. Franklin gave Hayes a copy of this letter and in a telephone conversation informed Hayes that additional time was needed to complete the review process. On 20 August 1985 Hayes sent Franklin a letter with the fol- lowing text: Pursuant to our telephone conversation last week and receipt of your August 16, 1985 letter to Pilato and Carpine, we have once again agreed to delay formalizing our tentative agreement of July 19, 1985 by way of extension to Tuesday, September 3, 1985. We consider the six-week period since July 19, 1985 to be more than ample time for a courtesy review, as you requested, of our agreement by the Seattle Metal Trades Council. I wish to point out that FCMTDC was designated as the formal bargaining agent in this matter as so stated by C. Briggs when he delegated the bargaining authority to the Puget Sound Committee of the PCMTDC. When we ne- gotiated with your Committee, we were ,led to be- lieve that all parties were duly represented and that our agreement was a full and comprehensive settle- ment of all issues. We would consider any substan- tive changes raised at this very date to be indicated PACIFIC COAST METAL TRADES COUNCIL ( LOCKHEED SHIPBUILDING) 243 of bad faith bargaining. 'We have bargained since April 2, 1985 and Messrs. Pilato,' Carpine, et al. have had ample time to communicate and in all concerns to you as their chief negotiator for the metal trades unions in this matter. We presume you have incorporated any concerns when we reached agreement at our meeting of July 19, 1985. We look forward to concluding our agreement by September 3, 1985. Again on 5 September 1985 Hayes wrote Franklin complaining about his lack of response. The letter notes: "more than ample time has lapsed to allow for a courte- sy review of the agreement by union officials at the dis- trict and local levels." On the same day, 5 September 1985, Franklin wrote Hayes as follows: I received your letter of August 20, 1985, refer- ring to our tentative agreement of July 19, 1985. To clarify some things that seem to confuse you, or you wish to ignore, my committee is a subcommit- tee of the District Council which answers to the entire Council. In other words, we have the power to negotiate, but final approval rests with the entire Board. The local Seattle Metal Council and had two of its affiliates, Electricians Local 46 and Boil- ermakers Local 104, challenged the application of the contract language pertaining to physical exami- nations and were sustained by the NLRB. Any lan- guage which might alter their positions must be dis- cussed with them also, as well as legal counsel which defended their position. There is nothing,un- usual in these practices and certainly in my mind are proper. I must remind you that we cannot have a tenta- tive agreement and still have a "full and compre- hensive settlement of all the issues." as you stated in your August 20 letter. If that is true, that would not be tentative, would it. My committee's understanding with you is tenta- tive until our discussions with all involved parties and could not be finalized until that was accom- plished. In our referred to phone conversation con- tained in your letter of August 20, I told you, that the Seattle Metal Trades Council had problems with our tentative language pending their review. Mr. Pilato and Mr. Carpine did not have time to comment on the tentative language until it was fi- nalized and they were not in attendance at all our meetings. After discussion with the parties affected our committee has determined that the agreement between us could not extend beyond the following criteria. Franklin's letter thereafter takes the position, essential- ly tracking the recommendations of Counsel Hafer, that Respondent now refused to negotiate any changes in the current agreement, but rather only offered to reduce to writing agreements and practices already in effect. The letter further asserted that Section 8(d) prohibited em- ployer unilateral contract changes. This position of Re- spondent was in essence a repudiation of the 19 July lan- guage agreed to by the participants. On 11 September 1985 Hayes wrote Briggs reciting Franklin's position and complaining to Briggs regarding Franklin's description of the limited authority of the union negotiating body. On 26 September 1985 Hayes re- sponded in effect suggesting that Franklin was correct in his description of the committee's authority, which reci- tation, Hayes added, was consistent with previous and current practice. As of the time of the hearing, the Charging Party con- tinued to assert that the terms agreed on on 19 July were binding on Respondents Respondent continued to main- tain that the 19 July agreement was subject to review, which review resulted in its rejection, and that therefore additional negotiations should take place in an effort to reach an agreement. B. The Issues The General Counsel argues that the agreement reached on 19 July was a binding agreement because it was reached unconditionally by Respondent's authorized agents. Respondent does not contest that the participants at the 19 July meeting reached agreement but makes nu- merous arguments that the agreement was not then and subsequently never did become final. At the threshold, Respondent argues that the question of whether the ex- isting 1983-1986 contract could be modified by the 19 July agreement should be deferred to an arbitrator under the grievance and arbitration provision of the collective- bargaining agreement. Second, even accepting the evi- dence on the issue most favorable to the General Coun- sel, Respondent argues that Respondent's negotiators had the right to and did insist on a review of the agreement by Pilato and Carpine and that Carpine's objections to the 19 July agreement prevented the agreement from being final and binding. Finally, Respondent argues that the Respondent's negotiators during the negotiations process, both by explicit statements and otherwise by op- eration of law based on past practice were unable to bind Respondent except by reaching an agreement subject to approval by the District Council as a whole and by a subsequent submission of any agreement approved by the District Council to unit employees for ratification. In response to Respondent's arguments, the General Counsel argues that the instant dispute is not susceptible to deferral because it involves a question of the very ex- istence of, rather than an interpretation of, a collective- bargaining agreement. The General Counsel challenges Respondent's claim of a review right by Carpine and Pilato as a matter of a no legal substance and, finally, challenges Respondent's factual and legal contentions that any agreement was subject to either Disrtict Council or employee approval. 5 A communication from Lockheed to Respondent offering to negoti- ate a settlement of the instant matter, even if admissible despite Fed.R.Evid. 408, does not modify the positions of the parties given the absence of a settlement nor otherwise affect the results 244 DECISIONS OF NATIONAL LABOR RELATIONS BOARD III. ANALYSIS AND CONCLUSIONS The Board has held that the issue of deferrability of an unfair labor practice allegation is a threshold issue that must be resolved before addressing the underlying mat- ters. Accordingly, the deferral issue will be addressed initially. Respondent's contentions, which accept for pur- poses of argument the validity of the evidence offered by the General Counsel, will be considered inasmuch as a favorable ruling thereon would obviate a need for re- solving the conflicting testimony concerning what was said during the course of the negotiations. A. Deferral Issue In the instant case, there is no dispute regarding the existence of a current collective-bargaining agreement with a binding grievance and arbitration clause. The issue, however, is whether that agreement has been modified by the 19 July agreement of the parties. In es- sence the question turns on issues of agency and the ex- istence of postagreement rights of review, ratification, or approval. The General Counsel correctly argues that the deferral doctrine, originating in the decision of Collyer Insulated Wire, 192 NLRB 837 (1971), has been held not to apply to disputes about the existence of a modification of a collective-bargaining agreement. Anaconda Co., 224 NLRB 1041 (1976), enfd. mem. 578 F.2d 1385 (9th Cir. 1978). Respondent argues on brief, ... the broad statements in the Anaconda Company case as to what is to be deferred are not valuable in light of the Board's broader reinstatement of defer- ral in United Technology Corporation, 268, NLRB 557 (1984); and Olin Corporation, 268 NLRB 573 (1984). The fact that there is a statutory issue, Section 8(d), does not foreclose deferral in light of Olin Corpora- tion. Respondent's argument, however, is fatally weakened by the fact that the doctrine as applied in Anaconda was ap- proved by the Board in Teamsters Local 287 (Reed & Graham), 272 NLRB 348 (1984), a post-Olin case. Respondent also argues that when the question of the existence of an agreement depends on an interpretation of the agreement itself, deferral is appropriate, citing Carpenters 46 Conference Board (Refrigeration Design), 278 NLRB 122'(1986); Iron Workers Local 587 (Orna- mental Iron), 276 NLRB 748 (1985); and Food & Com- mercial Workers Local 88 (Dierberg's Markets), 278 NLRB 455 (1986). Without accepting the breadth of the proposition asserted by Respondent, I find that it is un- necessary to interpret the current 1983-1986 collective- bargaining agreement in order to determine the validity of the 19 July agreement at issue. 'The contract between the parties may not properly limit the parties in modify- ing that agreement. This being so, the contract need not be interpreted by an arbitrator to determine predicate facts to deciding the binding nature of the 19 July agree- ment. Given all the above, I find the Anaconda case re- mains controlling. Accordingly, I will not defer the in- stant case. B. Right of Review by Either the Seattle Metal Trades or by Electrical Workers IBEW Local 46 and Boilermakers Local 104 There is no dispute that if a union agrees to a midterm modification, it must sign such an agreement, Hospital Employees District 1199-C (Episcopal Hospital), 241 NLRB 270 (1979). If such an agreement is subject to ap- proval, however, it is not binding until such approval is obtained. Hiney Printing Co., 262 NLRB 157 (1982). Respondent, taking the facts as presented in the Gen- eral Counsel's case-in-chief, makes two related arguments regarding the review rights Carpine and Pilato possessed after the 19 July meeting. Respondent contends initially that the parties in agreeing to a "courtesy review" by that fact alone as a matter of law established a condition precedent to final agreement irrespective of other agency and/or authority issues. This approval, when it was denied by Carpine, rendered the agreement nonbinding. Respondent also argues that the entire circumstances of the bargaining gave the Seattle Metal Trades first and IBEW Local 46 and Boilermakers Local 104 second par- ticipation rights in the bargaining that rendered the re- sults of the 19 July negotiations subject to, their review and rejection. 1. The significance of the right of a "courtesy review" Turning to the technical argument regarding the phrase "courtesy review," which was used by the parties in discussing the rights of Pilato and Carpine, neither brief cites case authority dealing with this precise reser- vation language. The Oxford English Dictionary defines "courtesy" as "by favor or indulgence; by common good will or allow- ance, as distinguished from inherent or legal rights."s In the absence of case authority on the question, I find the usage _ of the phrase courtesy review standing alone did not create any legal condition precedent to reaching a binding agreement. Thus, I fmd that although Franklin was in fact reserving a right of review for Carpine and Pilato, which Hayes admitted he was bound to accept, that right was by its terms no more than a matter of courtesy. Thus, I find the explicit reservation language used, standing alone, did not reserve to either Carpine or Pilato a right to prevent the agreement 's consummation. Having determined that the courtesy review reserva- tion of Franklin on 19 July was not by its terms suffi- cient alone to create a real or effective ability to prevent agreement on the part of Carpine or Pilato, I reject Re- spondent's argument that this reservation was independ- ently sufficient in law to render the 19 July agreement dissolved on the subsequent dissent of Carpine. 2. The right to review under the record of bargaining as a whole Having found the reservation for a courtesy review did not, by its terms, create a condition precedent to agreement being reached, it remains to be determined 6 Oxford English Dictionary, 1094 (1933). PACIFIC COAST METAL TRADES COUNCIL (LOCKHEED SHIPBUILDING) whether under all the circumstances of this case either the Seattle Metal Trades or the Electrical Workers IBEW Local 46 and Boilermakers Local 104 had rights to review that prevented the 19, July agreement from being a binding agreement in light of the subsequent dis- sent from its terms. Such a discussion at the threshold re- quires a detailed description of the bargaining as, it had occurred, with particular attention to the identification of various union parties. The 1983-1986 collective-bargaining agreement be- tween the parties' contains the following preamble: THIS AGREEME: 'T, ratified this 27th day of October 1983 by and between the Lockheed Shipbuilding and Construction Company, hereinafter called "Company" and the signatory International Unions, Seattle Metal Trades 'Council, Pacific Coast Metal Trades District Council of the Metal Trades De- partment of the AFL-CIO, hereinafter collectively called the "Union ...." The contract's article 3.2-Recognition states: The Company recognizes the Unions set forth in the Preamble and signatory hereto, as the sole col- lective Bargaining Agent for all of its employees covered by this Agreement ... . The contract's signature page bears the signatures of rep- resentatives of the following labor organizations: the Metal Trades Department of the AFL-CIO, the Pacific Coast Metal Trades District Council; the Seattle Metal Trades Council; and the following International Unions: Boilermakers; Carpenters; Electrical Workers; Laborers; Machinists; Operating Engineers; Painters; Sheetmetal Workers; Teamsters; and Plumbers. No constitutions or other governing rules and/or bylaws or other written documents or other oral testimony concerning agree- ments between these entities was offered into evidence. In the Board's decision, Lockheed I (273 NLRB 171),8 Lockheed was directed to, inter alia, (a) On request, bargain collectively and in good faith with International Brotherhood of Electrical Workers, Local 46, AFL-CIO and International Brotherhood of Boilermakers, Local 104, AFL-CIO concerning wages, hours, and other terms and con- ditions of employment of its employees and, if an understanding is reached, embody such understand- ing in a written agreement. One of the Board's conclusions of law in that case was that IBEW Local 46 and Boilermakers Local 104 were labor organizations which had been and were then the exclusive bargaining represenl.atives of certain of Lock- heed's employees. The Board's 16 January 1986 decision, Lockheed II (278 NLRB 18), made identical conclusions with respect to the representation rights of Electrical Workers IBEW Local 46 and Boilermakers Local 104 and, again, ordered Lockheed to bargain collectively and The 1980-1983 contract was not offered into evidence 8 The Board on 30 September 1985 denied Respondent's motion for clarification of that decision 245 in -good faith with the locals regarding the matters at issue. In the Lockheed I case the Board, overruling its ad- ministrative law judge, narrowed the recommended Order based in part on a finding that the unions had during bargaining acquiesced in certain of Lockheed's actions. The finding regarding union acquiescence was based on conduct taken during negotiations by the Seat- tle Metal Trades Council. Further both the Board's deci- sions in Lockheed I and II and the record in this cas.. in- dicate that local unions have reached independent writ- ten agreements with Lockheed, which agreements remain in effect and which are part of the bargaining his- tory herein. All the above indicates that although there is an over- all multiunion bargaining authority residing, the Pacific Coast Metal Trades District Council, there are other en- tities such as the Seattle Metal Trades and local unions such as Boilermakers Local 104 and Electrical Workers IBEW Local 46 that have historically actively partici- pated in the bargaining and litigation in the instant case. It is also clear that Lockheed at least initially thought that Boilermakers Local 104 and Electrical Workers IBEW Local 46 had the authority and/or the right, to bargain over the matters at issue. Thus, on 15 February 1985 Hayes wrote Boilermakers Local 104 and Electrical Workers IBEW Local 46, informing the two local unions that Lockheed was desirous of bargaining and further telling the locals that if they did not request bargaining within 10 days, Lockheed would assume they were not interested in bargaining regarding the matter and that, as a consequence, Lockheed would implement unilaterally those practices that had been held improper in the earlier Board proceedings. The ultimatum, even if incorrect as a matter of law, indicates that Lockheed felt that any fail- ure to request bargaining by the locals-as opposed to the District Council or the Seattle' Metal Trades-would allow Lockheed to implement ,contract changes. In response to Lockheed's invitation, both Electrical Workers IBEW Local 46 and Boilermakers Local 104 in- dicated they would enter into bargaining. Given this re- sponse, Lockheed then and only then wrote to the Pacif- ic Coast 'Metal Trades District Council informing the Council that Lockheed was extending an invitation to bargain to all the member unions of the Pacific Coast Metal Trades District Council. The letter also asked the District Council if it wished to participate in the, bargain- ing but added the qualifier that, if Lockheed had not heard from the District Council by a certain date, they would assume that that organization was not interested in discussing the matter. Thus, bargaining was to occur, in Lockheed's mind, irrespective of the District Council's participation. The communications to and from the District Council in early March, quoted in full supra, are critical to reso- lution of this case. The District Council initially delegat- ed bargaining to the Seattle Metal Trades Council and, thereafter, rescinded the delegation and named a District Council subcommittee. Importantly, however, the com- munication makes, it clear that the committee members would "arrange to, meet with your firm and the affected 246 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Local Unions for this case only." Thus, if the Seattle Metal Trades was not to participate in bargaining, the rights of the "affected Local Unions," including at the very least Electrical Workers IBEW Local 46 and Boil- ermakers Local 104, were explicitly preserved. Agents of at least eight local unions attended various sessions . Carpine of Electrical Workers IBEW Local 46 attended the first four sessions, Pilato of Boilermakers Local 104 attended the second, third, and fourth ses- sions.9 For reasons unexplained on this record, no repre- sentatives of the locals attended the fifth and final bar- gaining session. It was clear, however, that Franklin's reservation of a courtesy review at the end of the 19 July session was explicitly based on the absence of Pilato and Carpine at that session. t o Lockheed" and the District Council forwarded the written draft of 19 July to Electrical Workers IBEW Local 46 and Boilermakers Local 104 and Electrical Workers IBEW Local 46 obtained the legal advice quoted above. Thereafter, the District Council adopted the position of Electrical Workers IBEW Local 46 and the instant dispute ripened. Given all the above, it is clear, as is not unusual in multiunion collective-bargaining relationships, bargaining has taken place at various times: (1) between local unions and the Employer; (2) between the Seattle Metal Trades Council and the Employer; and (3) between the District Council and the Employer. It is also clear that in the medical screening bargaining Electrical Workers IBEW Local 46 and Boilermakers Local 104 had been original participants and had never had their role in the bargain- ing challenged by either the Employer or the District Council. That participation continued, at least in part by Electrical Workers IBEW Local 46, after 19 July and re- sulted in the current disagreement. Although not fully articulated on brief, it appears to be the position of the General Counsel and the Employer that whatever rights Boilermakers Local 104 and Electri- cal Workers IBEW Local 46 may have had with respect to bargaining' under the Board's Lockheed I order or as a result of previous negotiations were extinguished or pre- empted by the District Council and that the District Council's agreement to terms on 19 July was a final agreement not susceptible to review by the locals. Im- plicit in the argument is that the early March actions of the District Council in rescinding any authority earlier given to the Seattle Metal Trades rescinded the locals rights as well. Respondent argues that the locals did not have their rights extinguished and, at most, a parallel bargaining structure existed that preserved for the two locals at the very least a right to review the 19 July A critical ambiguity exists throughout these proceedings concerning the role of these agents because Carpine and Pilato were, in addition to being officials in their own local unions, officials in the Seattle Metal Trades Council. to Indeed, in Schell's minutes of the 19 July meeting Hayes complains to Franklin about the absence of "your representatives" and adds that "I assume they agree with the proposal or don't care." Hayes testified that Franklin said he wanted the review because Carpine and Pilato could not attend the session 11 Lockheed's transmissions, quoted supra to Electrical Workers IBEW Locals 46 and Boilermakers Local 104, explicitly acknowledged their roles in the earlier Board cases agreement and to reject it if it was not satisfactory. Re- spondent further argues, even if not independently creat- ing such a right, Franklin's reservation of a "courtesy review" on the part of the two locals supports such a finding and is evidence that Lockheed understood the rights residing with the locals. Initially, I fmd that the two locals had a right to bar- gain over the matter at issue and that all parties recog- nized this fact. This is so for several reasons. First, it is clear that the bargaining obligation imposed on the em- ployer by the Boards orders in Lockheed I and II ran ex- clusively to the two local unions. Indeed, the Board found that those local unions, the charging parties in the original matter, were the exclusive representative of cer- tain of the employees within the unit. Further, the Em- ployer's original invitation to bargain was addressed ex- clusively to the two locals and was only later expanded to include other local unions and the District Council. Importantly, neither the Employer's invitation to the District Council to join in bargaining nor the subsequent announcement by the District Council that it would bar- gain through a subcommittee limited the local's role. Rather, all correspondence explicitly indicated that bar- gaining would involve Boilermakers Local 104 and Elec- trical Workers IBEW Local 46. None of the documents quoted supra may be fairly read to indicate a preemption of the local's rights. Nor may Hayes' testimony regard- ing his conversations with Briggs about the District Council's role in bargaining be so construed. These com- munications limited only the role of the .Seattle Metal Trades.' 2 I also find there is no evidence that the locals waived their rights by their own actions or inactions. Boilermak- ers Local 104 and Electrical Workers IBEW Local 46 closely attended the bargaining sessions until, for reasons unknown on this record, the fifth session when neither local was in attendance. After receiving the draft agree- ment, Electrical Workers IBEW Local 46 had its counsel review its terms and thereafter Boilermakers Local 46 communicated its view regarding the matter to the Dis- trict Council, whose agents thereafter adopted the posi- tion taken by Boilermakers Local 46's counsel. I also find that the Employer explicitly recognized the rights of the two locals both before and after 19 July. The original ul- timatum to the locals by Lockheed that their failure to bargain gave Lockheed the right to implement changes is a clear statement that Lockheed believed the locals had exclusive authority in the matter. Further Hayes' letter of 19 July to Franklin conveying the written draft of the agreement states: Enclosed is the draft of the letter of agreement ten- tatively accepted by both parties at our bargaining session of July 19, 1985. It is our understanding that 12 From none of the actions of Carpine and Pilato or others on the Union's side may the inference be drawn that Carpine and Pilato were acting for the Seattle Metal Trades Council rather than for their own local unions in the bargaining. Thus, each man in all record correspond- ence used the letterhead of the local rather than the Seattle Metal Trades Council. Further, as noted above, Lockheed explicitly recognized the role these agents had as representatives of the charging parties in Lock- heed I PACIFIC COAST METAL TRADES COUNCIL (LOCKHEED SHIPBUILDING) 247 you wish to allow one more "review by the Seattle Metal Trades prior to executing the formal agree- ment. By copy of this transmittal to W. Carpine, Seattle Metal Trades Council Secretary Treasurer and Business Agent for Electricians Local #46 and to Joseph Pilato, Seattle Metal Trades Council President and Business Manager for Boilermakers #104, the parties to the NLRB proceedings regard- ing medical screen have been Only included. This letter indicates both that the agreement reached was acknowledged by Lockheed to be tentative and that the Charging Parties in the Board proceeding, Electrical Workers IBEW Local 46 and Boilermakers Local 104, must be duly included. I have determined, above, that Franklin's explicit res- ervation of courtesy review rights for Carpine and Pilato on 19 July- did not, standing alone, create such a review right in the' locals. Franklin's conduct, however, and Re- spondent's acquiescence to it, supports my finding that there is insufficient evidence to sustain the General Counsel's burden of proof that the parties explicitly in- tended that' Electrical Workers IBEW Local 46 and Boilermakers Local 104 did not originally have or in some manner lose the bargaining rights explicitly award- ed in the Board's Lockheed I order. This finding is clearly one that turns on the unusual facts of the case rather than on a bare technical legal analysis of agency principles. Given these unusual facts, in particular the ambiguities in the dual roles of Pilato and Carpine and the possibilities of mistake and misre- liance arising therefrom, and considering the overall eq- uities of the case, it seems clear that it is better to return the parties to the bargaining table where after a clear ex- plicit recitation of the rights, responsibilities, and authori- ties of the various union bargaining agents an agreement can be negotiated. To do otherwise, in my view, would produce an unequitable result inconsistent with previous Board orders and the fair intention of the parties when examining the bargaining negotiations and correspond- ence as a whole. Such caution is particularly important in midterm contract modification bargaining about which the Board has noted: - Strict adherence to all safeguards designed to insure full consideration of the consequences of a mid-con- tract modification is especially important where, as here, the proposed modification would have in- volved the Union's consent to substantial reductions in contractual wage rates over which it was' not le- gally obligated to bargain. t a Accordingly, based on all the above, I find that the agreement reached on 19 July 1985 was susceptible to review by Boilermakers Local 104 and Electrical Work- ers IBEW Local 46 and that, until agreement had been 18 Hiney ,Printing Co., 262 NLRB 157 fn. 2 (982). 'obtained, the parties did not intend to be bound by the 19 July agreement. I further find that in fact Electrical Workers IBEW Local 46 raised objections to the 19 July agreement that were not in bad faith14 and which pre- vented the 19 July from becoming binding on the parties. This being so, I find'that at no time was there a final agreement that Respondent became obligated to sign. Having found Respondent was not obligated to sign the written agreement reflecting the terms reached on 19 July 1985,' I find it did not improperly refuse to bargain collectively with the Employer in violation of Section 8(b)(3) of the Act. Accordingly, I will dismiss the com- plaint herein." s Based on the above findings of fact and the record as a whole, I make the following CONCLUSIONS OP LAW 1. Lockheed Shipbuilding and Construction Company is an employer engaged in commerce within the meaning of Section 2(6) and (7) of the Act. 2. The Pacific Coast Metal Trades District Council, the Seattle Metal Trades Council, Boilermakers Local 104, and Electrical Workers IBEW Local 46 are labor organizations within the meaning of Section 2(5) of the Act. 3. Lockheed Shipbuilding and Construction and Pacif- ic Coast Metal Trades District Council did not reach final and binding agreement on the terms of a midterm contract modification on 19 July 1985 or any other date. 4. Respondent did not violate Section 8(b)(3) of the Act by failing and refusing to execute a letter of agree- ment reflecting the terms of the 19 July 1985 agreement. 5. Respondent has not otherwise violated the Act. On these findings of fact and conclusions of law and on the entire record, I issue the following recommend- ed16 ORDER The complaint is dismissed. 14 I do not find the Unions' sudden change of position after consider- ing counsel Hafer's letter to be deceitful or evidence of bad faith. This is so because the original letters from Lockheed, quoted above, threatened unilateral implementation of its bargaining proposal if the Unions did not bargain. This was a misstatement ' of the law and, when the Unions, through counsel, learned of the correct state of the law on the matter their bargaining position changed. The Unions are not to be held in some way accountable for a sudden change in bargaining position occurring as a result of the discovery of an employer-caused misapprehension of their rights under the Lockheed I Board Order and the Act. 15 Having dismissed the complaint on the basis of the above, I find it unnecessary to resolve the testimonial conflicts, noted above, nor to ad- dress Respondent's additional defenses that the 19 July agreement was conditioned both on final approval by the District Council and subse- quent ratification by unit employees. 18 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.