464 U.S. 945 (1983)

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U.S. Supreme Court

SCHAEFER v. N.L.R.B. , 464 U.S. 945 (1983)

464 U.S. 945

No. 82-1971 Supreme Court of the United States October 31, 1983

On petition for writ of certiorari to the United States Court of Appeals for the Third Circuit.

The petition for writ of certiorari is denied.

Justice O'CONNOR, with whom Justice POWELL and Justice REHNQUIST join, dissenting from denial of certiorari.

I would grant certiorari in this case to clarify the application of the National Labor Relations Board's (Board) policy of deferral to private resolutions of labor disputes. The Board applies this formal policy to both arbitral and nonarbitral settlements of labor disputes, including settlements of unfair labor practice charges. See Central Cartage Co., 206 N.L.R.B. 337, 338 (1973). In this case, petitioner made apparent concessions in collective bargaining negotiations to get the employees' Union to withdraw its unfair labor practice charges. See App. to Pet. for Cert. 26a, 35a-36a. Petitioner also paid cash settlements to four employees in exchange for waivers of any back pay they might be entitled to receive. Id., at 6b-7b. The Board refused, however, to defer to the Union's waiver because the parties had not resolved the legal merits of the charges and because petitioner had not provided substantial remedies for its unfair labor practice. Id., at 36a. The Board also determined that the four employees could not settle their back pay claims without Board approval and ordered petitioner to make full restitution. Id., at 6b-7b. The Court of Appeals for the Third Circuit affirmed.


The Board's application of its deferral policy in this case is inexplicable. For example, the Board asserts that the settlement negotiations did not address and resolve the unfair labor practice claims. Brief in Opposition 7-8. The record clearly indicates, however, and, ironically, the Board's General Counsel found objectionable, see App. to Pet. for Cert. 35a-36a, that petitioner and Union engaged in extensive discussions concerning withdrawal of

Page 464 U.S. 945 , 946

the charges. Id., at 25a-26a. The Board has regularly held that its decision to defer does not depend on whether it agrees with the parties' actual resolution of the dispute. See, e.g., Howard Electric Co., 166 N.L. R.B. 338, 341 (1967) (deference to arbitral settlement); Terminal Transport Company, Inc., 185 N.L.R.B. 672, 673 (1970) (same). Rather, it requires the parties to discuss the charges to assure that the employees have made a clear and knowing waiver of their statutory right to process complaints before the Board. See Coca-Cola Bottling Co., 243 N.L.R.B. 501, 502 (1979) (deference to nonarbitral settlement). It is beyond peradventure that the Union and the four employees who accepted cash settlements made such a waiver here.

Similarly, the record contradicts the Board's contention that petitioner did not remedy the unfair labor practice. Brief in Opposition 8-9. Surely at least some of petitioner's bargaining concessions were attributable to the Union's agreement to withdraw the unfair labor practice charges. Any concessions the Union made, including waiver of the charges, would be binding upon the employees, absent evidence that the Union acted in bad faith. See Hines v. Anchor Motor Freight, Inc., 424 U.S. 554, 564-567, 1056-57 (1976). Even if the Union's waiver was not determinative, the cash settlements the four employees accepted would be. No one who understands the economic logic of the old hunter's adage that "a bird in the hand is worth two in the bush" could dispute the substantiality of the remedy provided. Certainly the Board cannot do so, as it has approved settlements which contained no back pay awards. See, e.g., Krause Honda, Ltd., 8 NLRB Advice Memo.Rep. 18, 221 (1981) (nonarbitral settlement); Beloit Corp., Jones Division, 6 NLRB Advice Memo. Rep. 14,177 (1979) (same).

Moreover, the Board's assertion that settlements reached after its decisions have issued are not substantial remedies is contrary to its previous rulings. See, e.g., Krause Honda, Ltd., supra (ruling that the timing of settlements does not affect Board's deferral policy). Issuance of an adverse Board decision should make employers more willing to settle on more generous terms. Thus, settlements reached after Board decisions should be more, not less, likely to afford substantial redress for violations of the Act than are settlements reached before that time. The Board has not articulated a substantial reason for treating such a settlement less deferentially in this case. [464 U.S. 945 , 947]

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