Tri-Fanucchi Farms v. Agricultural Labor Relations Board
Tri-Fanucchi Farms v. Agricultural Labor Relations Board
Opinion
*1163 In 2012, Tri-Fanucchi Farms (Tri-Fanucchi) refused to bargain with the United Farm Workers of America (the UFW), the labor union that its employees had elected in 1977 as their bargaining representative under the Agricultural Labor Relations Act (the ALRA or the Act). Tri-Fanucchi argued that the union had abandoned its employees for more than two decades and thus forfeited its status as bargaining representative. Consistent with its longstanding practice, the Agricultural Labor Relations Board (the Board or the ALRB) rejected the employer's abandonment defense and determined that Tri-Fanucchi's refusal constituted an unfair labor practice under the ALRA. The Board then ordered Tri-Fanucchi to pay make-whole relief under Labor Code section 1160.3, which is intended in part to compensate employees for employer-caused delays in the collective bargaining process. (All undesignated statutory references are to the Labor Code.) The Court of Appeal affirmed the Board's rejection of Tri-Fanucchi's abandonment defense. But the Court of Appeal reversed the Board's make-whole relief award, reasoning that Tri-Fanucchi's litigation "furthered the broader purposes of the ALRA" because no appellate court had expressly ruled on the abandonment issue presented here.
For the reasons set forth in
Gerawan Farming, Inc. v. Agricultural Labor Relations Board
(Nov. 27, 2017, S227243) --- Cal.5th ----,
Tri-Fanucchi is a farming business located in Kern County. It employs approximately 35 permanent employees and hires several hundred seasonal employees through various labor contractors.
On October 21, 1977, after a secret ballot election, the Board certified the UFW as the exclusive bargaining representative of Tri-Fanucchi's employees. Several days later, the UFW initiated collective bargaining negotiations. Tri-Fanucchi responded by refusing to bargain, purportedly to seek judicial review of the union's election. The following year, the UFW filed an unfair labor practice charge alleging that Tri-Fanucchi's refusal to bargain violated the ALRA. The charge was dismissed after Tri-Fanucchi reversed its position and agreed to begin negotiations. (See Tri-Fanucchi Farms (1986) 12 ALRB No. 8, p. 2 (hereafter ALRB 1986 Decision).)
Some initial bargaining sessions occurred after the UFW was certified. But between May 1979 and July 1981, "no communications between the parties took place and no negotiations were scheduled." (ALRB 1986 Decision, supra , 12 ALRB No. 8 at p. 2.) In July 1981, after the UFW requested to resume bargaining, Tri-Fanucchi conducted an employee "poll" to ascertain whether they desired to be represented by the UFW. As a result of this poll, Tri-Fanucchi concluded that the UFW had lost the support of a majority of its employees, and so the company again refused to bargain with the union. ( Id. at p. 3.) The UFW filed several unfair labor practice charges against Tri-Fanucchi, which the Board ultimately sustained. Finding that Tri-Fanucchi's refusal to bargain "was without justification or arguable legal support," the Board awarded make-whole relief under section 1160.3. (ALRB 1986 Decision, at p. 9.) In an unpublished opinion, the Court of Appeal affirmed both the Board's findings that Tri-Fanucchi committed unfair labor practices and its make-whole relief award.
According to Tri-Fanucchi, the company informed the UFW that it was willing to bargain in 1988. The UFW initially represented that it would schedule negotiations after the union's lead negotiator returned from vacation, but the UFW never responded and no dates were ever set. Tri-Fanucchi *1165 claims that the UFW then made no effort to communicate with the employer or to represent its employees for the next 24 years. The UFW disputes these claims, asserting that it maintained contact with the employees during this time period and even represented them on nonbargaining matters. Because the Board ruled that an employer cannot raise an abandonment defense as a matter of law, it took no evidence on Tri-Fanucchi's abandonment claim and simply assumed that the facts Tri-Fanucchi alleged were true.
On September 28, 2012, the UFW sent Tri-Fanucchi a formal request to restart bargaining. Tri-Fanucchi responded with a letter stating that "the UFW has ... abandoned the bargaining unit and is no longer the valid collective bargaining representative of its employees." Further, *549 Tri-Fanucchi said that because the question whether a union can lose its status as bargaining representative through abandonment had "never been conclusively addressed" by the courts, it would refuse to bargain "to obtain judicial review of the status of the UFW." The UFW urged Tri-Fanucchi to reconsider and said its refusal to bargain was "in clear bad faith" because relevant ALRB precedent rejecting abandonment was "so clear."
After Tri-Fanucchi did not retreat from its position, the UFW filed unfair labor practice charges with the Board in early 2013, alleging that Tri-Fanucchi violated the ALRA by refusing to bargain and to provide requested information. The Board's general counsel thereafter filed an administrative complaint against Tri-Fanucchi alleging that the company's actions violated section 1153, subdivisions (a) and (e), and seeking make-whole relief for the benefit of Tri-Fanucchi's employees. ( Tri-Fanucchi Farms (2014) 40 ALRB No. 4, p. 3 (hereafter ALRB 2014 Decision).) In its answer, Tri-Fanucchi admitted to the factual allegations but claimed as a defense, among other things, that the UFW had abandoned its status as bargaining representative. ( Id. at p. 4.) Tri-Fanucchi also claimed that its refusal to bargain was in good faith for the purpose of obtaining judicial **1114 review of an important labor relations issue.
The case was set for an administrative law judge (ALJ) hearing on October 21, 2013. Before the hearing, the Board's general counsel filed a motion to exclude any evidence relating to Tri-Fanucchi's abandonment defense, contending that the ALRA did not permit such a defense. The ALJ granted the motion, holding that even if the facts Tri-Fanucchi sought to prove were true, they did not establish a defense to bargaining under the ALRA. In light of Tri-Fanucchi's admissions, the ALJ found that Tri-Fanucchi's refusal to bargain violated the ALRA. The ALJ further ordered that Tri-Fanucchi pay make-whole relief to its employees for the period from October 19, 2012, when Tri-Fanucchi made clear its refusal to bargain with the UFW, until the date that it commenced good faith bargaining with the union. (ALRB 2014 Decision, supra , 40 ALRB No. 4 at pp. 4-7.)
*1166 The Board issued its decision on April 23, 2014, largely affirming the ALJ's rulings. The Board explained that its "previous decisions have been very clear that, under the ALRA, the fact that a labor organization has been inactive or absent, even for an extended period of time, does not represent a defense to the employer's duty to bargain." (ALRB 2014 Decision, supra , 40 ALRB No. 4 at p. 8.) "[E]xcept in cases where the union disclaims interest in representing the bargaining unit or becomes defunct," the Board continued, "the union remains certified until removed or replaced through the ALRA's election procedures, regardless of any bargaining hiatus or union inactivity that may have occurred." ( Ibid. ) The Board likewise affirmed the ALJ's order awarding make-whole relief. Because Tri-Fanucchi's position on the abandonment defense was "contrary to over 30 years of Board precedent holding that abandonment is not a defense to the duty to bargain," the Board concluded that Tri-Fanucchi's "position cannot be said to further the policies and purposes of the ALRA." ( Id. at p. 18.)
The Court of Appeal upheld the Board's rejection of Tri-Fanucchi's abandonment defense as a "reasonable interpretation and application of the ALRA." Under the ALRA, the court concluded, Tri-Fanucchi "was not entitled to refuse to bargain with UFW based on UFW's past failings or inactivity, and such conduct did not create a defense to bargaining, whether labeled *550 as abandonment or otherwise." But, holding that "the Board was clearly wrong in its legal conclusion that [Tri-]Fanucchi's litigation efforts in this matter did not further purposes and policies of the ALRA," the Court of Appeal reversed the Board's order imposing make-whole relief. Despite the Board's settled interpretation that the ALRA provided no abandonment defense to bargaining, the court believed that "the question has remained to a significant degree unsettled and controversial" because no "appellate court" had weighed in on the precise issue. In the court's view, Tri-Fanucchi's "litigation plainly furthered the broader purposes of the ALRA to promote greater stability in labor relations by obtaining an appellate decision on this important issue."
Tri-Fanucchi petitioned for review of the Court of Appeal's rejection of its abandonment defense, and the Board sought review of the Court of Appeal's reversal of the make-whole relief. We granted both petitions for review.
II.
The Court of Appeal concluded that the UFW's allegedly "lengthy period of inactivity did not defeat [Tri-]Fanucchi's duty to engage in bargaining with that union upon request." We affirm this conclusion in light of our holding in
Gerawan
that "an employer may not defend against a union's [mandatory mediation and conciliation] request by challenging the union's
*1167
certification as bargaining representative on the basis of abandonment." (
Gerawan
,
supra
, --- Cal.5th at p. ---- [p. 44],
Tri-Fanucchi's arguments in favor of an abandonment defense restate those we rejected in Gerawan . The only new contention raised by Tri-Fanucchi is that the Board has "repeatedly recognized" the abandonment theory in earlier decisions. But Tri-Fanucchi misstates the Board's analysis in these decisions. As the Board explains, these decisions used the terms "abandonment" and "totally 'absent from the scene' " to describe situations in which the union was "unwilling or unable" to represent the employees-i.e., union disclaimer or defunctness. (See Bruce Church, Inc. (1991) 17 ALRB No. 1, pp. 9-10; Dole Fresh Fruit Company (1996) 22 ALRB No. 4, pp. 9-13.) Nothing in these decisions referred to the type of inactivity-based defense that Tri-Fanucchi attempts to raise here. Indeed, in Dole Fresh Fruit Company , the Board expressly refrained from recognizing the broader "concept of 'abandonment.' " ( Dole Fresh Fruit Company , at p. 15.)
In sum, the Court of Appeal correctly upheld the Board's order rejecting Tri-Fanucchi's abandonment defense.
III.
We now consider whether the Court of Appeal improperly reversed the Board's determination that Tri-Fanucchi should pay its employees make-whole relief because *551 of its refusal to bargain with the UFW.
The ALRA authorizes the Board to grant certain remedies, including make-whole relief, when it determines that a party has engaged in unfair labor practices. ( § 1160.3.) "Make-whole relief is a compensatory remedy that reimburses employees for the losses they incur as a result of delays in the collective bargaining process. [Citation.] The remedy is designed to give agricultural employees the type of economic benefits they would have received if the parties had reached a timely agreement." (
*1168
George Arakelian Farms, Inc. v. Agricultural Labor Relations Bd.
(1989)
The Legislature "inten[ded] that the ALRB serve as 'one of those agencies presumably equipped or informed by experience to deal with a specialized field of knowledge, whose findings within that field carry the authority of an expertness which courts do not possess and therefore must respect.' " (
Tex-Cal Land Management, Inc. v. Agricultural Labor Relations Bd.
(1979)
In light of the Legislature's clear intent to confer broad remedial powers on
*552
the Board, the Board's orders imposing remedies are only " 'subject to limited judicial review.' " (
Carian, supra
, 36 Cal.3d at p. 674,
We first considered the ALRA's make-whole remedy in
J. R. Norton Co. v. Agricultural Labor Relations Bd.
(1979)
Although
J. R. Norton
's standard applies to cases involving technical refusals to bargain, its reasoning that the Board should not impose make-whole relief on a per se basis and should instead "examine the particular facts or circumstances of each case to determine [its] 'appropriateness' " is more broadly applicable. (
F & P Growers
,
supra
, 168 Cal.App.3d at p. 680,
The parties agree that Tri-Fanucchi's refusal to bargain was not technical, and neither party disputes that the
F & P Growers
standard applies here. We have implicitly endorsed the
F & P Growers
standard before (see
Arakelian
,
supra
, 49 Cal.3d at pp. 1294-1295,
The Court of Appeal recognized that the Board "explicitly followed" the F & P Growers standard in its decision. Nevertheless, in setting aside the Board's remedial order, the Court of Appeal criticized the Board for basing its decision "solely on its legal evaluation or value judgment that [Tri-] Fanucchi's litigation of the abandonment issue ... did not further the policies and purposes of the ALRA." This "legal conclusion" was "clearly wrong," the court said, because "the question of how an appellate court would actually rule when confronted with the novel situation of such long-term union absence or egregious inactivity (i.e., 24 years) as alleged here was far from certain." The court continued: "[T]he question has remained to a significant degree unsettled and controversial. Against this larger backdrop, it is clear to us that judicial review of the issue was reasonably necessary and helpful to all parties concerned, including both unions and agricultural employers, for the beneficial purpose of clarifying and/or confirming the law. Therefore, [Tri-] Fanucchi's advancement of this litigation plainly furthered the broader purposes of the ALRA to promote greater stability in labor relations by obtaining an appellate decision on this important issue."
We conclude that the Court of Appeal, in determining that Tri-Fanucchi's litigation "plainly further the broader purposes of the ALRA," improperly assumed the Board's remedial authority. Despite recognizing that the Board should be given "due deference," the Court of Appeal did not give the Board's make-whole relief order any deference. Rather, the court determined that the Board's "legal conclusion" was "clearly wrong" and then independently determined that make-whole relief was inappropriate in this case.
But the ALRA expressly authorizes the Board to impose make-whole relief "when
the board
deems such relief appropriate." ( § 1160.3, italics added.) In
*1171
assessing whether make-whole relief is appropriate, the Board has adopted a standard that asks whether litigation of the employer's position furthers the ALRA's policies and purposes. The Board's decision to impose make-whole relief is thus best understood as an exercise of the Board's discretionary policy authority, not a legal conclusion subject to de novo review. (See
Bixby v. Pierno
(1971)
Of course, the Board must determine on a case-by-case basis whether make-whole relief is appropriate; it may not award such relief without exercising its discretion. (
**1118
F & P Growers
,
supra
, 168 Cal.App.3d at pp. 681-682,
The Court of Appeal opined that only a published appellate decision in the context of a "long-term union absence" was sufficient to "settle" the question whether the ALRA permits employers to raise an abandonment defense. To be sure, "the courts are the ultimate arbiters of the construction of a statute." (
California Assn. of Psychology Providers v. Rank
(1990)
Nor can the court's conclusion be squared with its own observation that the Board's rejection of Tri-Fanucchi's abandonment defense was "consistent with how California appellate courts have construed the ALRA." The Court of Appeal cited several published appellate decisions, including
Montebello Rose Co. v. ALRB
(1981)
*555
Although
J. R. Norton
cautioned against placing "burdensome restraints on those who legitimately seek judicial resolution of close cases" (
J. R. Norton
,
supra
, 26 Cal.3d at p. 32,
The F & P Growers standard does not focus solely on whether an appellate decision would bring greater clarity to the law.
**1119
Instead, it requires the Board to weigh the extent to which the employer's litigation advances the ALRA's purposes and policies against the risks and harms caused by such
*1173
litigation and its attendant delays to the collective bargaining process. (
F & P Growers
,
supra
, 168 Cal.App.3d at p. 682,
To hold that make-whole relief is inappropriate unless there is a published appellate decision on the exact issue raised by the employer would risk undermining the ALRA's purpose of bringing stability to agricultural labor relations by encouraging employers to refuse to bargain and instead to litigate disputed issues. If parties were allowed to regularly circumvent Board decisions by obtaining relief in court, "the Board would be replaced by ad hoc determinations by already overcrowded courts. The legislative effort to bring order and stability to the collective bargaining process would be thwarted. The work of the Board would be effectively impaired, its decisions similar in impression to that of a tinkling triangle practically unnoticed in the triumphant blare of trumpets." (
United Farm Workers v. Superior Court
(1977)
Accepting the Court of Appeal's rationale would thwart the Legislature's design to give
the Board
, not the courts, "exclusive primary jurisdiction over all phases of the administration of the Act as regards unfair labor practices." (
UnitedFarm Workers v. Superior Court
,
supra
, 72 Cal.App.3d at p. 271,
CONCLUSION
For the reasons above, we reverse the Court of Appeal's judgment reversing the Board's award of make-whole relief. In all other respects, we affirm *1174 the Court of Appeal's judgment and remand for further proceedings consistent with our opinion.
We Concur:
Cantil-Sakauye, C. J.
Chin, J.
Corrigan, J.
Cuéllar, J.
Kruger, J.
Kline, J. *
Presiding Justice of the Court of Appeal, First Appellate District, Division Two, assigned by the Chief Justice pursuant to article VI, section of the California Constitution.
Reference
- Full Case Name
- TRI-FANUCCHI FARMS, Petitioner, v. AGRICULTURAL LABOR RELATIONS BOARD, Respondent; United Farm Workers of America, Real Party in Interest.
- Cited By
- 9 cases
- Status
- Published