03/10/2025: Region Rejects Bid to Sever Existing Bargaining Unit into Two Units
Also, SpaceX loses a procedural appeal in the Fifth Circuit.
Southwark Metal Manufacturing Co., 04-RC-354800 (Regional Election Decision)
This case concerns whether 16 truckdrivers employed by Southwark Metal Manufacturing Co. should be severed from a longstanding bargaining unit of production, shipping, and maintenance department employees. The Highway Truck Drivers and Helpers Local 107 (Teamsters) filed a petition seeking to represent these truckdrivers in a separate unit, while both the employer and the current representative (Laborers' Local Union 57) opposed this severance.
The Regional Director, Kimberly E. Andrews, applied the analytical framework established in Mallinckrodt to determine whether severance was appropriate. After analyzing six factors, she concluded that severance was not warranted and that only the historically established wall-to-wall unit was appropriate for election purposes.
The Mallinckrodt factors considered were:
Whether the proposed unit consists of a distinct and homogeneous group of skilled journeymen craftsmen or functionally distinct department working in trades with a tradition of separate representation.
The history of collective bargaining of the employees sought and at the plant involved.
The extent to which employees have maintained a separate identity during inclusion in a broader unit.
The history and pattern of collective bargaining in the industry involved.
The degree of integration of the employer's production processes.
The qualifications of the union seeking to "carve out" a separate unit.
The first factor weighed against severance because the truckdrivers did not constitute a distinct and homogeneous group or functionally distinct department. They were part of the shipping department, shared common supervision with other shipping employees, and there was evidence of both permanent and temporary interchange between truckdrivers and other unit positions. The Director also noted differences among the truckdrivers themselves, particularly Truckdriver Green, who had unique job tasks compared to other drivers.
The second factor strongly disfavored severance due to the 40-year history of collective bargaining with the Laborers' Union, during which the unit remained unchanged and stable labor relations were maintained. The third factor was deemed neutral, as while truckdrivers maintained some separate identity (separate seniority list and shop steward), there was no evidence that the Laborers' Union failed to give them adequate representation. The fourth factor concerning industry bargaining patterns was inconclusive due to insufficient evidence.
The fifth factor regarding integration of production processes weighed against severance. The Director found that truckdrivers were integrated with the rest of the employees at the facility, as they relied on loaders to properly load trailers and could not perform their tasks unless production employees and loaders performed their jobs properly.
Only the sixth factor favored severance, as the Teamsters was deemed well-qualified to represent truckdrivers based on their longstanding experience representing approximately 4,000 truckdrivers and negotiating around 250 contracts involving truckdriver units.
Balancing these factors, the Regional Director ruled that the Petitioner did not meet its burden to establish that a severance election was appropriate. The decision directed that if the Teamsters wished to proceed, an election would be held in the existing wall-to-wall unit, conditional upon the Teamsters providing an adequate showing of interest in the overall unit.
Significant Cases Cited
Mallinckrodt Chemical Works, 162 NLRB 387 (1966): Established the analytical framework for determining whether to sever a group of employees from an existing bargaining unit.
Kalamazoo Paper Box Corp., 136 NLRB 134 (1962): Examined whether truckdrivers constitute a functionally distinct group with overriding separate special interests.
Battelle Memorial Institute, 363 NLRB 1098 (2016): Placed the burden on the party arguing in favor of severance.
Fernandes Super Markets, Inc., 171 NLRB 419 (1968): Evaluated whether separate community of interests have been "submerged into the broader community of interest."
Hackney Corp., 224 NLRB 197 (1976): Applied both Mallinckrodt and Kalamazoo Paper factors in deciding whether truckdrivers could be severed from an established unit.
Airport Aviation Services, Inc., 12-RC-329965 (Regional Election Decision)
This case involves a petition filed by Union Independiente de Trabajadores del Aeropuerto seeking to represent service and security agents, cleaners, and group leaders utilities employed by Airport Aviation Services, Inc. at Luis Muñoz Marín International Airport in Carolina, Puerto Rico. The key issue was whether jurisdiction over the employer fell under the National Labor Relations Board (NLRB) or the National Mediation Board (NMB) under the Railway Labor Act (RLA).
Airport Aviation Services is not an air carrier but provides wheelchair terminal services, food cart inspections, and cleaning services to Delta Air Lines and Iberia at the airport. The employer handles its own hiring, discipline, and personnel policies, though Delta approves overall staffing levels based on seasonal changes. The employer's employees wear uniforms with the employer's logo, and while Delta provides certain guidelines and requirements through their contract, the employer maintains control over its workforce.
The Regional Director analyzed the jurisdictional question by referencing recent precedent from the NMB and NLRB. Notably, in November 2024, the NMB issued an advisory opinion in Swissport Cargo Services stating that Swissport's operations were not subject to the RLA. The NLRB subsequently adopted this position in December 2024, noting that the NMB had abandoned its previous two-part test for determining RLA jurisdiction over contractors to air carriers.
The NMB's new approach holds that if a company is not itself a common carrier by air and is only connected to air transportation through service contracts with airlines, it is not subject to RLA jurisdiction. Following this precedent, the Regional Director concluded that Airport Aviation Services is not subject to the RLA since it is not a common carrier by air and is only connected to air transportation through its service contracts with Delta and Iberia.
Significant Cases Cited
Swissport Cargo Services, LP, 373 NLRB No. 144 (2024): Established that service contractors to air carriers are not subject to RLA jurisdiction if they are not common carriers themselves.
Swissport Cargo Services, LP, 52 NMB 25 (2024): NMB advisory opinion concluding that Swissport's operations were not subject to RLA jurisdiction.
Jetstream Ground Services, Inc., Case 10-RC-304155 (2024): Unpublished NLRB decision deferring to NMB's opinion that Jetstream was not subject to RLA jurisdiction.
PrimeFlight Aviation Services, Inc., 52 NMB No. 15 (2024): Held that employers connected to air transportation only through service contracts are not subject to RLA jurisdiction.
DHL Worldwide Express, 340 NLRB 1034 (2003): Established the principle that the NLRB accords substantial deference to NMB opinions on jurisdictional matters.
Hood River Distillers, Inc. V. NLRB, 23-1235 (Circuit Court)
This case involves a petition for review by Hood River Distillers challenging a National Labor Relations Board decision that found the company violated the National Labor Relations Act (NLRA) by unilaterally implementing changes to employment terms without reaching an impasse in negotiations with Teamsters Local Union No. 670.
Hood River operates a liquor distillery in Oregon with approximately 25 unionized employees. The parties began negotiating a new collective bargaining agreement in February 2019 following the expiration of their prior agreement. Key issues included health insurance coverage, 401(k) benefits, union access to the facility, and wages. The company had recently sold its best-performing liquor brand, making profitability a concern.
Over 14 months, the parties held only seven bargaining sessions. In June 2019, the Union proposed accepting a three-year wage freeze while maintaining the existing OPET health plan and 401(k) match program. Hood River's negotiating team initially showed enthusiasm for this proposal but later rejected it after consultation with the company's CEO. This rejection led to a new phase of bargaining beginning in September 2019.
During this second phase, Hood River presented what it termed a "final" offer proposing to move Union members from the OPET health plan to the company's Blue Cross plan. The parties continued negotiating through March 2020, with meetings in March showing significant movement on both sides. The Union agreed to a four-year contract, a wage freeze in the first year, and switching health plans, while requesting wage increases in subsequent years.
Despite this progress, on April 23, 2020, Hood River declared an impasse and informed the Union it would unilaterally implement its March 30 offer on May 1. The Union denied any impasse existed. After Hood River implemented its offer, Union members went on strike. Hood River subsequently hired replacement workers, initially as temporary employees but later declaring them permanent replacements.
The Board found that Hood River violated the NLRA by unilaterally implementing its offer without reaching a genuine impasse. The Board's determination was based on evidence that the parties were still making progress in negotiations, with both sides making significant concessions during their March 2020 meetings.
Hood River presented two main arguments on appeal: (1) that the Board erred in concluding the parties were not at an impasse, and (2) that the Union's delay tactics justified unilateral implementation even absent an impasse.
The D.C. Circuit denied Hood River's petition and granted the Board's cross-application for enforcement. The court applied a deferential substantial evidence standard of review, noting that "few issues are less suited to appellate judicial appraisal than evaluation of bargaining processes." The court found the Board reasonably determined that neither party was at the end of its rope when Hood River declared impasse, as both sides had made significant concessions and progress in March 2020.
The court also rejected Hood River's argument that the Union's insistence on in-person mediation during the early COVID-19 pandemic constituted an unjustified delay tactic that would have privileged unilateral implementation. The court deferred to the Board's credibility determinations regarding the Union's explanation that it believed the pandemic would end quickly, making in-person mediation possible.
Judge Walker dissented, arguing that substantial evidence did not support the Board's finding that the Union bargained in good faith. He highlighted that the Union rejected more than 70 proposed bargaining dates, frequently delayed meetings, and gave pretextual reasons for delays, including taking an excessive amount of time to compare health plans.
Significant Cases Cited
TruServ Corp. v. NLRB, 254 F.3d 1105 (D.C. Cir. 2001): Establishes that an employer violates its duty to bargain if it unilaterally changes employment terms absent a final agreement or bargaining impasse.
Thrifty Payless, Inc. v. NLRB, 86 F.4th 909 (D.C. Cir. 2023): Defines impasse as occurring only when both sides have exhausted prospects of reaching a deal and are unwilling to compromise.
Wayneview Care Ctr. v. NLRB, 664 F.3d 341 (D.C. Cir. 2011): Establishes the substantial evidence standard for reviewing Board impasse determinations.
Serramonte Oldsmobile, Inc. v. NLRB, 86 F.3d 227 (D.C. Cir. 1996): Recognizes an exception to impasse requirement when a union insists on continually avoiding or delaying bargaining.
Spurlino Materials, LLC v. NLRB, 805 F.3d 1131 (D.C. Cir. 2015): Explains that employees engaging in an unfair labor practice strike are entitled to reinstatement to former positions, even if employer hired replacements.
Space Exploration Technologies Corp. V. NLRB, 24-40315 (Circuit Court)
The United States Court of Appeals for the Fifth Circuit dismissed SpaceX's appeal for lack of subject-matter jurisdiction in a case where SpaceX challenged the constitutionality of NLRB proceedings against it.
The case arose after SpaceX discharged several employees in 2022 - four for distributing an open letter that violated company policies, several for allegedly lying during a subsequent leak investigation, and another for performance issues. These employees filed charges with the NLRB, alleging SpaceX violated the National Labor Relations Act. In January 2024, the NLRB Regional Director consolidated these cases and set a hearing for March 5, 2024.
SpaceX filed suit against the NLRB in the Southern District of Texas (SDTX) on January 4, 2024, challenging the constitutionality of the NLRB's structure and requesting injunctive relief. The NLRB moved to transfer the case to the Central District of California (CDCA), arguing improper venue because no parties resided in the SDTX district and there was no substantial connection between the events and the venue.
On February 15, 2024, the district court granted the transfer motion. SpaceX immediately sought a writ of mandamus from the Fifth Circuit to prevent the transfer. While the Fifth Circuit initially stayed the transfer, the case was nonetheless docketed in the CDCA. After several procedural steps, including the denial of SpaceX's petition for en banc rehearing, SpaceX asked the SDTX to either reconsider the transfer or resolve its preliminary injunction motion before transferring the case.
The underlying NLRB proceeding began on March 5 but was continued to May and then postponed indefinitely pending resolution of subpoena disputes. On April 24, SpaceX learned of a teleconference scheduled for May 2 regarding discovery issues. On April 26, SpaceX requested a ruling on its motions by May 2. Instead of waiting for the court's decision, SpaceX filed its appeal on April 30, arguing that the district court's failure to rule by May 2 constituted an "effective denial" of its preliminary injunction motion.
The Fifth Circuit analyzed whether it had jurisdiction under 28 U.S.C. § 1292(a)(1), which allows appeals from interlocutory orders that refuse injunctions or have the "practical effect of doing so." The court determined that for jurisdiction to exist, SpaceX needed to show that the district court's inaction had the practical effect of refusing an injunction and would cause "serious, perhaps irreparable, consequence."
The court concluded that SpaceX failed to demonstrate such consequences would result from participating in the May 2 teleconference. The court also found that SpaceX had not shown diligence in seeking expedited consideration, having only requested a ruling deadline a week before the teleconference and filing its appeal before that deadline passed.
The court ruled that the district court did not "effectively deny" SpaceX's motion by failing to rule within the requested timeframe, particularly given SpaceX's repeated procedural challenges to the transfer decision that occupied much of the intervening time. Consequently, the Fifth Circuit dismissed the appeal for lack of subject-matter jurisdiction.
Significant Cases Cited
Carson v. Am. Brands, Inc., 450 U.S. 79 (1981): Established that interlocutory appeals require showing both practical effect of refusing an injunction and serious, irreparable consequences.
Sherri A.D. v. Kirby, 975 F.2d 193 (5th Cir. 1992): Clarified that increased litigation costs alone are insufficient to justify interlocutory appeal.
E.E.O.C. v. Kerrville Bus Co., 925 F.2d 129 (5th Cir. 1991): Ruled that defending charges brought by an agency does not constitute irreparable harm.
In re Fort Worth Chamber of Commerce, 100 F.4th 528 (5th Cir. 2024): Established that what counts as effective denial is contextual and varies by case.
Sinochem Int'l Co. v. Malaysia Int'l Shipping Corp., 549 U.S. 422 (2007): Held that district courts may resolve forum issues before addressing other threshold objections.