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Union gets unredacted copy of third-party agreement incorporated into bargaining proposal

By Ronald Miller, J.D.

Because an employer incorporated a Home Service Provider agreement with a third party into its bargaining proposal to a union, the employer had to provide a full, unredacted copy of that agreement to the union.

A DirectTV installation contractor was obligated to provide a full, unredacted Home Service Provider (HSP) agreement to a union so that the union could evaluate the extent of work covered by the employer’s bargaining proposal, ruled the D.C. Circuit. The agreement was not presumptively relevant because it did not pertain directly to bargaining unit employees. However, it was relevant to the union’s duties as bargaining representative because the employer itself incorporated the full agreement by reference into a bargaining proposal. Additionally, the appeals court concluded that the NLRB acted within its authority in denying a post-hearing motion by DirecTV to intervene on the ground that it was untimely (DirectSat USA LLC v. NLRB, June 7, 2019, Srinivasan, S.).

DirectSat installs and services satellite television equipment for DirecTV. From September 2014 until May 2014, it negotiated with the union representing its employees. During negotiations one issue that arose was whether future products or services other than installation and service of satellite television services would constitute bargaining unit work. The parties exchanged a series of “New Product Lines” proposals over that issue.

Union information request. On November 4, 2015, the employer submitted a proposal that any new work that arose during the term of the agreement would not count as bargaining unit work unless it was “pursuant to its Home Service Provider agreement with DirecTV.” The union requested a copy of the HSP agreement. Two weeks later, the employer provided a heavily redacted copy of the agreement, which it describes as “relevant to the scope of the work.”

In the ensuing months, the union repeatedly demanded the full HSP agreement and the employer repeatedly refused. On March 22, the parties held a bargaining session at which DirectSat acknowledged the union’s request for a full agreement and responded that the relevant portions had already been disclosed. Thereafter, the employer denied further requests by the union for a copy of the HSP.

Relevance of information. The union filed an unfair labor practice charge. An administrative law judge found that the employer had violated the NLRA by refusing to provide the full, unredacted agreement. Although the ALJ initially determined that the union lacked an objective basis for its belief that the document was relevant to a joint-employer relationship, he concluded that the union was entitled to the unredacted document based on a theory not argued by the NLRB General Counsel—that the union had a right to verify DirectSat’s assertion that it had provided the relevant portions of the agreement.

The Board affirmed the ALJ and ordered DirectSat to disclose the full, unredacted agreement on the basis that the employer’s bargaining proposal had defined the scope of the bargaining unit by reference to the entire agreement. The Board also rejected the employer’s argument that the ALJ violated its due process rights by relying on a rationale not argued by the General Counsel.

Motion to intervene. After the Board issued its decision, DirecTV filed a motion to intervene asserting a confidentiality interest in the terms of the unredacted agreement. The Board denied DirecTV’s motion as untimely. The NLRA allows any person to intervene in a Board proceeding “in the discretion of the Board.” Therefore, the D.C. Circuit reviewed the Board’s decision for abuse of discretion, examining whether the Board exercised its discretion in an arbitrary way (and not whether its analysis was consistent with the standards set forth in Fed.R.Civ.P. 24, as urged by DirecTV).

The appeals court concluded that the Board reasonably rejected DirecTV’s motion. The parties agreed that, as of November or December 2016, DirecSat informed DirecTV that it was disclosing a redacted copy of the HSP agreement to help resolve the pending Board charge. DirecTV was then on inquiry notice that disclosure of the agreement was an issue in an ongoing Board matter. That notice occurred some seven months before the hearing before the ALJ, fifteen months before the Board decision, and sixteen months before DirecTV moved to intervene. Under such circumstances, the Board reasonably concluded that DirecTV filed its motion to intervene long after it knew or reasonably should have known that an order requiring disclosure of the agreement was a possibility.

Moreover, the appeals court disagreed with DirecTV’s contention that the Board’s denial of intervention was inconsistent with certain of the Board’s decisions as recounted in The Boeing Co. Rather, the Board acted within its authority in denying DirecTV’s post-hearing motion for intervention.

Disclosure of unredacted agreement. Next, the appeals court turned to the Board’s order requiring DirectSat to disclose the unredacted HSP agreement. An employer’s duty to bargain encompasses a responsibility “to provide relevant information needed by a labor union for the proper performance of its duties as the employees’ bargaining representative,” noted the court. Here, the parties agreed that the HSP agreement was not presumptively relevant because it did not pertain directly to bargaining unit employees. However, the Board understandably determined that the agreement was relevant to the union’s duties because DirectSat itself incorporated the full agreement by reference. The employer’s contention that only portions of the agreement were relevant was belied by the proposal’s own reference to the agreement as a whole. Under such circumstances, the union could not respond to the proposal in a manner consistent with its duty of fair representation without knowing what the agreement said as a whole.

As the Board had explained, the union “‘cannot be reasonably expected to integrate another agreement between the employer and a third party into its own collective-bargaining agreement without having a complete understanding of the contents of the incorporated document and the context of the relevant portions within the document as a whole.’”

Due process rights. Further, the appeals court rejected the employer’s contention that its due process rights were infringed because the ALJ required disclosure of the agreement based on a rationale not advanced by the General Counsel. The Board rested its decision on the rationale that DirecSat’s bargaining proposal had rendered the full agreement relevant. The complaint, however, alleged that the employer “failed and refused to furnish” the unredacted agreement, which was “necessary for, and relevant to the union’s performance of its duties.” Moreover, the employer’s briefing addressed whether the full agreement was relevant. Thus, this issue was fully and fairly litigated.