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Case number 23-1025 et al.

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From work company LLC doing business as Berkeley 181 hospitality LLC petitioner versus National Labor Relations Board.

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Mr. Eron for the petitioner, Mr. Seid for the respondent.

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Good morning.

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Please court.

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I'm Thomas here on a bunch of King on behalf of.

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We're here asking the court to deny enforcement of an order from the National Labor Relations Board.

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Case presents two interrelated questions.

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First is their substantial evidence in the record as a whole to support the finding that our hotel insist indefinitely the resolution of all non economic subjects before negotiating economic subjects.

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in the collective bargaining for a first contract.

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The second question is, what caused these negotiations for a first contract to break down?

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As the administrative law judge found, so the record of bargaining here is in writing.

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Parties were negotiating during COVID, they were all telephonic communications, and there were detailed bargaining notes, as well as multiple emails between the principal negotiator.

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And this record is focused strictly on the bargain.

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There are no allegations of unlawful conduct outside of the bargaining.

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No claim of unlawful threats or unlawful changes to wages in terms of employment.

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No discriminatory treatment of union supporters.

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No other evidence of animus to the union.

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And we must recognize that these negotiations occurred in the context of the COVID pandemic.

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2020.

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And as of in here, it had a devastating effect both on the hospitality industry in New York City and then on this particular hotel, which is a small independent hotel.

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Mr. Can I ask you to focus your your factual arguments under the pretty demanding substantial evidence standard?

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Certainly, your honor.

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So how do you how do you how do you overcome that?

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I think there are two key big picture points and then some very specific points.

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In terms of big picture, we have a split decision from the labor board.

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One member dissenting.

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And there is a concern that the board did not fully

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The majority did not fully evaluate the totality of the circumstance.

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In particular, did not appreciate, did not give consideration, appropriate consideration to the interplay in the collective bargaining.

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The union's position from day one was that it had a massive agreement.

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This document, over 100 pages, covers multiple subjects.

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And the union insisted

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that the company provide a complete response.

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In the ALJ's decision, in her recitation of the facts, she recites 18 different times when the union demanded a complete response.

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And the board failed to evaluate and consider appropriately the impact of that approach to bargaining.

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In any bargaining, there is a trade-off one side to the other.

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one side does affects the impact of the other.

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And the failure here on the board's part was in not considering the union's conduct and the consequences.

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So for example, the very specific language that the board uses to find a violation is that the

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employer insisted indefinitely on the resolution of all non-economic subjects before negotiating economic subjects.

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There was no insistence here.

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The employer initially proposed a ground rule but modified that to allow simultaneous discussion.

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It's not even an appropriate description of the employer's position to say it was non-economic.

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employers' proposals included a proposal on overtime pay, a proposal on work schedule, which are critical to the economics of the business, not simply a non-economic subject.

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It didn't persist indefinitely on this position.

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This negotiation was just getting started.

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We're short introductory

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Discussions that were cut short because the union insisted That the employer was obligated to provide a complete Contract proposal and I think just on so for example Given the substantial evidence standard the board did explicitly find that the union did not present the idea of UAE

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on a, as they put it, a take it or leave it basis and repeatedly emphasized its flexibility with respect to both economics and contract wording.

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So certainly that was their initial proposal, but there's a lot of evidence in the record about how the union offered to make adjustments and have an MOU that adjusted to Troutbrook's circumstances.

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So how can we sort of accept your view that the union was

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uh, doggedly insisting without flexibility on the full IWA in light of the board's findings.

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There's no question that the approach that the company took here was a legitimate approach.

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In fact, the unions negotiator Mr. Martin conceded that he had seen this approach before he recognized it as a reasonable approach.

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And the company's goal was to get a simple, um,

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clear contract.

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The union's approach was to bargain from this document.

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And if you add a right to a 100 page document, you just have a longer document.

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You do not have a simple, clear collective bargaining agreement.

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So the two approaches were completely inconsistent.

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And the record is very clear that the union said there is a legal obligation

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for the company to provide a response.

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We are stopping negotiations, going to the labor board.

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We want to get a ruling on that issue.

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And when they went to the labor board, the general counsel chose not to do that issue.

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That is not the basis for the decision here.

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And that's what caused this negotiation.

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to fall apart.

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Right.

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So the unfair labor practice that the board found is a refusal to bargain over mandatory subjects of bargaining.

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So I understand the possible exceptions of overtime in the other example you mentioned.

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But it seems to me one simple question is, did the company ever engage on or give a counter proposal on, for example, wages, retirement benefits, or health benefits?

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It did not, Your Honor.

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However, it did present

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several significant proposals, and the union chose not to make any counterproposals on those individual proposals.

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And I would submit to you that that's a critical difference between the precedent that the board is relying on.

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Examine those earlier cases.

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In each case, there was a back and forth, a give and take.

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The best example, frankly, is the patent trader

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where it was a new contract, the union came in with a standard area agreement.

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When the employer objected to that, they began negotiating over specific issues.

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And there was back and forth.

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There was counterproposals from the union.

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They moved off of their

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master agreement.

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Are you, is your position also that the board's decision here is arbitrary and capricious and contrary to law?

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Our position is that it's bad labor policy Europe because it sets up a bad labor policy under the statute or yes yes that it's that it is

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We're not here to enforce labor policy.

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We're here to enforce the law.

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Right.

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I understand.

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But as we're evaluating the legal consequences of the board's decision, it's fair to recognize that it puts in the hands of a single party the ability to demand a complete response on all issues

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early in the process, that is going to support the ability to reach agreement.

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Is the legal problem with that, that it's inconsistent with board precedent, that it's inconsistent with the NLRA?

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What is the legal argument?

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That it's inconsistent with the purpose of the statute, which is to support and encourage collective bargaining and the resolution of disputes.

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This rule of law does not achieve that result.

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Is there a specific provision of the NLRA that you believe the board has violated here?

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No, Your Honor, that's not the point that we're making.

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The underlying goal in this is to determine whether the parties have an intent to reach an agreement.

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And we submit that the companies

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approach was consistent with that intent and that there's nothing outside of the bargaining or within the bargaining that would lead to the conclusion that they acted in bad.

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And as we analyze the impact of the board's decision on this overall goal of statute to achieve labor peace.

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This decision takes us

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in a direction that's going to make it more difficult to achieve consensus, compromises, and avoid labor disputes.

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So we would ask that the court deny enforcement.

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Could I just ask one last question?

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You referenced the impact of the pandemic.

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And I just want to make sure I understand the argument.

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Because to the extent the question is, if we thought there was otherwise evidence that the company did not engage on economic subjects,

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I of course understand the pandemic created a lot of uncertainty.

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But maybe that would just create good conditions for the employer to insist on very lean economic proposals.

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Is your argument that somehow the pandemic justified postponing discussion of those subjects entirely?

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And why would that be?

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That's not our argument.

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There are two elements that I think are relevant from the pandemic.

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There was a great deal of upheaval in the industry and at this employer.

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At the start of this process, there were 30 employees in the bargaining unit.

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By the time they sat down to do the negotiations, it was down to eight.

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In the course of all that, there was no claim that the union supporters were adversely treated or treated unfairly.

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And the second point is that

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This is a small hotel.

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It was a very difficult time for the hotel.

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And the negotiation process stalled and not robust in the way that would have been in a more normal economic environment.

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The management of the hotel was worried about keeping the hotel going.

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these negotiations did not proceed far enough to make the judgment that the board made here.

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Thank you.

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Thank you.

[00:13:54] Speaker 02:
Good morning, Your Honor.

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David Seid for the Labor Board.

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Two initial points.

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First, the record amply supports the Board's finding that the company unlawfully refused to bargain over economic terms until non-economic terms were resolved.

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That evidence, which includes numerous statements made by the company during bargaining that are summarized at page 35 of the Board's brief,

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repeatedly referenced the need to resolve non-economic terms first.

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Well, what about the fact that the board here doesn't seem to have taken into account the union's conduct?

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I mean, the union had its own particular bargaining position, which is that it wanted to start with the IWA.

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It wanted a counter proposal to that.

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Obviously, the hotel had a different bargaining position.

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So I mean, if the board's responsibility is to take into account the totality of the circumstances,

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the negotiations isn't the failure to just to completely to totally disregard what the union did your honor make the decision not supported by substantial evidence your honor very simply the board did not ignore what the union did what the company is presented to this court is

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But it hasn't shown that the record compels this court to come to a different conclusion.

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And so with respect to the argument made about the union's conduct, the board first very reasonably noted that the focus is on the company's conduct because it has a statutory obligation under the act to discuss terms such as wages of employment and of wages.

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And the board then, however, did very specifically consider

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the union's conduct at page 331 of the appendix or the board's decision, the board looked at what the union did.

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And it did recognize that, yes, initially the union did want the company to accept the IWA as it existed.

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But it then suggested, well, if you don't like the IWA as it's written,

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We can make as many changes as you want to, but at least use it as a basis so we're talking the same language.

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But the hotel rejected that bargaining position as well.

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They didn't want to start with the IWA.

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They wanted a simpler, pared-down, shorter contract, which is my understanding that as well within its rights under the NLRA.

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Absolutely, Your Honor.

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But then the union and the alternative said, OK, if you insist on starting with an entirely new contract,

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At least give a full holy trinity of issues, the main terms and conditions.

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Well, again, that was a bargaining position.

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It's not.

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It wasn't that the hotel was then required to do what the union asked.

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Your honor, it's required under section 80 of the act to specifically discuss terms such as wages.

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They cannot do as it did here.

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But it didn't have to present a counter proposal as the union demanded.

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Your honor, but like a full counter proposal.

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Right, that's correct.

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And so the board did not find that the union, that the employer violated the act by failing to submit a complete counter proposal.

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And so, for example, and hesitant to make a hypothetical here, but could there have been a situation, one of the things that the company is trying to argue is that basically negotiation short-circuited.

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Had the company come back with a full-wage proposal,

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And the union still said, well, not good enough.

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We're not going to consider your full wage proposal until you give us something else.

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Then could it arguably be a different case?

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Possibly.

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But that's not what happened here.

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The union repeatedly stated, look, accepting that you as a company want to start with an entirely new contract

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We don't think we have to go that way, but if that's what you want to do, at least give us something and start with something like wages and benefits, really elephant in the room.

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And the company's response was continually, even at the last bargaining session, the second to last bargaining session, non-economic first, and then eventually after we settle those, we'll get to economic.

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Well, I mean, both sides were being intransigent to some extent.

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They both wanted to start from different bargaining positions.

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And the act specifically says,

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that, you know, obviously the employer has an obligation under section 18, but such obligation does not compel either party to agree to a proposal or require the making of a concession.

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Correct, Your Honor.

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It doesn't require a concession, but it does require to really discuss the term.

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Well, would it not have been a concession to start with a proposal the way that the union wanted?

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Your honor, if parties agree to discuss non-economic terms first, they're welcome to.

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When the parties do not have such an agreement, it is unlawful for an employer to insist on resolving the non-economic terms until they will even make or discuss economic proposals.

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And that's what the company did here.

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And just briefly touching on the pandemic, the company never argued to the board, and I think it acknowledged that argument this morning, that the pandemic in and of itself provided an excuse for not providing proposal on wages and benefits.

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And as the board did note, to the extent it is being relied upon,

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Council made abundantly clear from the very first session that it simply bargain.

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In the process of starting with non economic course, it did not even my knowledge, even raise the pandemic initially.

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And there's no question that while the pandemic had an effect in bargaining and allegedly hiatus, I would simply note the hiatus in the pandemic.

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affected all the parties that affected the employees who had voted at this point for union representation several years earlier that have obvious concerns as to whether their wages might be frozen or cut.

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It has an impact on the union because when bargaining does resume,

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the certification has essentially ended.

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And at that point, if the employer has a belief that the employees no longer support the union, it has the ability to simply walk away.

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So it affected everybody, not just the company.

[00:20:25] Speaker 01:
Can you point to other board precedents where there's been such a short time of bargaining?

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I mean, here there was, everyone acknowledges, a seven month or so, I think, hiatus, right?

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So the actual time of bargaining

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was a few months over, you know, a handful of sessions.

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And it seems to me that the precedents where, you know, there's some finding of bad faith, I mean, usually involve many more bargaining sessions, many more hours of bargaining, many more months of bargaining.

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I mean, here, you know, in some ways they had sort of just gotten started in a sense.

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And so how is the board's decision here consistent with its precedent?

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It's consistent.

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So cases such as first student,

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every eight months, Sunbelt rentals, there was a bargaining over about four months.

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But one of the things I would also point out here is that even in some of these cases where the board found a violation, what typically happens is a union will make an entire proposal as a union did here.

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At that point, the employer may take the position that it would prefer to discuss non-economic subjects first.

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There's no formal agreement that resolution has to be reached.

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And in response, the employer, even in some of these cases where eventually a violation was found, the employer comes back with a full counter proposal on non-economic matters.

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It accepts a lot of what the union proposed and makes minor changes to others.

[00:21:52] Speaker 01:
So is the board's position here that employers have to do this when presented, when the union says we want a full counter proposal, employers have to do that?

[00:21:59] Speaker 01:
I mean, is that the bottom line of the board's decision?

[00:22:02] Speaker 01:
No, again, the board not... There are several things you said here in argument that suggest this is the board's position.

[00:22:07] Speaker 01:
which suggests that Chairman Ring maybe have been right in his concerns about the majority's opinion.

[00:22:14] Speaker 03:
That is not what the board's decision suggested or that council is suggesting.

[00:22:19] Speaker 03:
Simply noting that here the union repeatedly expressed to at least get a proposal or discussion about wages and benefits that kind of the elephant in the room and that even in situations where employers have been

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not providing or discussing an economic proposal, oftentimes the employers in those situations do a lot more than the company did here by making, at least on non-economic terms, a somewhat comprehensive proposal, which the company didn't even do here.

[00:22:54] Speaker 03:
That's all I'm suggesting, but it's not in any way suggesting that the company was required to, at the first bargaining session or the second

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both counter-repulsal.

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The board is, that is not.

[00:23:06] Speaker 01:
What about the third or fourth bargaining session?

[00:23:08] Speaker 03:
No, or even the third or the fourth.

[00:23:10] Speaker 03:
Again, it's a case by case basis as to at what point did a employer violate the act by failing to provide, discuss economics.

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And on the facts of this particular case, when it hits the fifth bargaining session and the union has been pleading for at minimum, if you want to present your own offer

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your own contract at least give us something about wages and benefits.

[00:23:37] Speaker 03:
The company responds intending to negotiate over a subset of non economic subjects, then move on to another subset and ultimately move on to economics at that point where there is five sessions or 20 sessions or 30 sessions or very reasonably.

[00:23:54] Speaker 03:
find that the company was refusing to negotiate or economic subjects at a situation where it is impacting and preventing bargaining.

[00:24:05] Speaker 04:
I mean, what if they had just said, let's talk a little bit about the union's proposal on health benefits and had, to some extent, a discussion and expressed concerns about that.

[00:24:16] Speaker 04:
Would that be enough to yield a different outcome?

[00:24:19] Speaker 04:
And why?

[00:24:22] Speaker 03:
Your honor, again, on a case-by-case basis, but if the employer had started to indicate a willingness to engage the union on the economic subjects, it very well could have a different result.

[00:24:36] Speaker 03:
But it made absolutely no attempt in this case, as it admittedly stated both in argument this morning as well as

[00:24:48] Speaker 03:
Unless this court has any further questions, the board would simply ask the court in favor of its order.

[00:24:54] Speaker 02:
Thank you, your honor.

[00:24:55] Speaker 01:
I'll give you two minutes on rebuttal.

[00:25:09] Speaker 05:
Thank you, your honors.

[00:25:11] Speaker 05:
Just briefly, counsel for the board referenced Sundell case.

[00:25:20] Speaker 05:
There were significant actions by the employer demonstrating an anti-union animus case that clearly distinguishes it from the present case.

[00:25:42] Speaker 05:
And I think we need to be clear

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on the record as to what the union's position was.

[00:25:54] Speaker 05:
There is substantial evidence that it requested a complete response and it did not provide any counter proposals unless and until there was a complete response.

[00:26:09] Speaker 05:
I respectfully submit to council for the board misstated the union's position that it was only looking for a

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a response on wages or benefits.

[00:26:20] Speaker 05:
Um, that has no support in the record.

[00:26:23] Speaker 05:
Um, we would, uh, again, into our request for deny enforcement of this board order.

[00:26:30] Speaker 05:
Thank you very much.

[00:26:32] Speaker 01:
Thank you.