NLRB Advice Memoranda, RE: UTC Railcar Repair Services, LLC d/b/a UTLX, National Labor Relations Board, (Jun 21, 2022)

The Region submitted this case for advice as to whether inaccurate statements made by Union Tank Car Co. d/b/a UTLX (“the Employer”) at a mandatory meeting in June 2021 could be relied on as evidence to establish a Section 8(a)(3) violation within the Section 10(b) period for the Employer withholding an annual cost-of-living wage increase from employees, despite the Employer first having withheld such increases in early 2019. We initially conclude that allegations over the Employer's withholding of annual cost-of-living wage increases from employees in early 2019 and 2020 are time-barred pursuant to Section 10(b) of the Act. We further conclude that the Employer's subsequent withholding of an annual cost-of-living increase from employees in 2021 is time-barred by Section 10(b), and that the Employer's statements in June 2021 are not sufficient to establish an exception to Section 10(b)'s statutory limitation. Therefore, the Region should dismiss the charge, absent withdrawal.

This case involves the Employer's facility in Texarkana, Arkansas, which performs repair and maintenance work on the Employer's railroad tank cars. From 2016 to 2018, and possibly in prior years, the Employer granted its employees a cost-of-living wage increase at the rate of 2.5% on January 1 of each year. [1]

In late 2018 or early 2019, United Steelworkers of America (“the Union”) engaged in an organizing campaign at the Employer's facility. In early 2019, the Employer informed the employees that they would not be receiving a cost-of-living wage increase that year due to the Union organizing campaign and the upcoming representation election.

On July 11, 2019, the Union was certified to represent a bargaining unit of about 90 employees at the facility. Soon after, it made a proposal regarding the Employer's cost-of-living wage increase at the onset of first contract negotiations; however, the Employer did not agree to it, and the Union neither filed charges nor demanded bargaining over the lack of cost-of-living increases.

On July 22, 2019, the Union sent a letter to the Employer that requested certain information, including a notice of all wage increases given by the Employer. Although the Union did not refer to the cost-of-living wage increase by name, it did mention that there were “… employees who would normally be in line for a merit or other wage increase in accordance with past Company practice.”

On October 14, 2020, after the Employer had failed to grant its employees a cost-of-living wage increase in January 2020, the Union sent another letter to the Employer asking for backpay at a 5% rate to account for the lack of a cost-of-living wage increase in both 2019 and 2020. In this letter, the Union gave the Employer its express permission to grant wage increases to the employees. But the Union did not file a charge over the issue.

On June 30, 2021, the Employer held four mandatory meetings with employees for the ostensible purpose of updating them on the status of contract negotiations with the Union. After the Employer's presentation had concluded, a few employees asked the Employer why they had not received their cost-of-living wage increase. The Employer replied that it could not provide a cost-of-living wage increase to employees because it was still bargaining with the Union, and the Union had not yet approved a cost-of-living wage increase for employees.

On August 23, 2021, the Union filed an initial charge alleging that the Employer had violated Section 8(a)(1) by threatening employees with discharge, interrogating employees about their Union sympathies, and assisting a decertification effort by permitting employees to leave their work areas for several hours to discuss their opposition to the Union. On November 19, 2021, the Union amended the charge to include for the first time allegations that the Employer had made unlawful statements during the June 30, 2021, mandatory meetings, and had failed to grant employees a cost-of-living wage increase.

We initially conclude that allegations over the Employer's withholding of annual cost-of-living wage increases from employees in 2019 and 2020 are time-barred pursuant to Section 10(b). We further conclude that the Employer's subsequent withholding of an annual cost-of-living wage increase from employees in 2021 is time-barred by Section 10(b), and that the Employer's statements in June 2021 are not sufficient to establish an exception to Section 10(b)'s statutory limitation.

Section 10(b) of the Act provides “[t]hat no complaint shall issue based upon any unfair labor practice occurring more than six months prior to the filing of the charge with the Board.” It is firmly established that the 10(b) period commences when a party has clear and unequivocal notice of a violation of the Act, or where a party in the exercise of reasonable diligence should have become aware that the Act had been violated. See, e.g., Moeller Bros. Body Shop, 306 NLRB 191, 192-93 (1992) (union's failure to monitor or enforce its contractual union-security rights amounted to constructive knowledge of the employer's violations and placed the union's charge outside of the 10(b) period). Notwithstanding the failure to include a specific allegation in a timely-filed charge, the Board will not find an allegation precluded by Section 10(b) where it is closely related to an allegation in a timely-filed charge. See id.; Redd-I, Inc., 290 NLRB 1115, 1118 (1988), as clarified in Carney Hospital, 350 NLRB 627, 630 (2007). [2] To determine whether the “closely related” test is satisfied:

the Board (1) considers whether the otherwise untimely allegations involve the same legal theory as the allegations in the timely charge; (2) considers whether the otherwise untimely allegations arise from the same factual situation or sequence of events as the allegations in the timely charge; and (3) “may look” at whether a respondent would raise the same or similar defenses to both the untimely and timely charge allegations.

Carney Hospital, 350 NLRB at 628 (citing Redd-I, 290 NLRB at 1118). The untimely allegation to be amended to the timely charge must also concern conduct that occurred within six months of the timely filed charge. See Old Dominion Freight Line, Inc, 331 NLRB 111, 111 (2000); Fry's Food Stores, 361 NLRB 1216, 1216 (2014) (“… a complaint may be amended to allege conduct outside the 10(b) period if that conduct took place within 6 months of a timely filed charge and is ‘closely related’ to the allegations of that charge”). Moreover, although an employer's discriminatory discontinuation of wage increases before the 10(b) period does not become a timely allegation absent other unlawful conduct within the 10(b) period, the continued denial of wage increases may be considered a separate and distinct violation in the 10(b) period where the employer engages in other unlawful conduct and takes the affirmative step of appraising employees as it would have when awarding merit increases as part of a past practice. Compare Bonwit Teller, Inc., 96 NLRB 608, 610 (1951) (finding that even though an employer's initial decision to discontinue wage reviews may have violated Section 8(a) (1), “the mere failure of the [r]espondent during the 6-month limitation period to modify or rescind that decision” cannot be regarded as a continuing violation of the Act), enforcement denied on other grounds, 197 F.2d 640 (2d Cir. 1952), cert. denied, 345 U.S. 905 (1953), overruled on other grounds, Livingston Shirt Corp., 107 NLRB 400 (1953), with General Motors Acceptance Corp., 196 NLRB 137, 137-38 (1972) (finding that continued withholding of merit increases within 10(b) period as part of other violations committed to oust the union violated Section 8(a)(1) where merit increases were found to be a past practice along with appraisals that were continued by the employer), enforced, 476 F.2d 850 (1st Cir. 1976).

Applying these principles, we conclude that the Union's allegation in the current charge that the Employer violated Section 8(a)(3) by withholding a cost-of-living wage increase is time-barred under Section 10(b). The Union filed the initial charge on August 23, 2021, which would make February 23, 2021, the earliest potential date within the six-month 10(b) period. The Employer's initial withholding of the cost-of-living wage increase from employees in early 2019, before the employees selected the Union to represent them, pre-dates February 23, 2021 by more than two years.

The evidence also establishes that the Union also had notice of a potential violation well outside the Section 10(b) period. After the Union became the employees' certified bargaining representative, it sent the Employer a letter dated July 22, 2019, in which it requested information about wage increases granted by the Employer and referred to “employees who would normally be in line for a merit or other wage increase in accordance with past Company practice.” That language supports finding that the Union knew in July 2019 that the Employer's withholding of a cost-of-living wage increase earlier that year contravened the Employer's past practice. However, even assuming that evidence was insufficient to find Union knowledge, any question about this is resolved by the Union's October 14, 2020, letter to the Employer, in which the Union asked the Employer to grant the employees backpay at a 5% rate to make up for the lack of cost-of-living wage increases in 2019 and 2020. That letter confirms that the Union had knowledge at least by October 14, 2020 that the Employer had withheld 2.5% cost-of-living wage increases in both years outside the current charge's 10(b) period. Nevertheless, the Union failed to timely file charges over the issue.

Nor does an allegation regarding the Employer withholding cost-of-living wage increases from employees in 2019 and 2020 avoid being barred by Section 10(b) because it is “closely related” to a timely charge allegation. Although the current charge timely alleges, among other things, that the Employer violated Section 8(a)(1) during the June 30, 2021 mandatory meetings by telling employees the Union was the reason they had not received cost-of-living wage increases, the withholding of wage increases is 2019 and 2020 did not occur within six months of the filing of the current charge. See, e.g., Old Dominion Freight Line, Inc., 331 NLRB at 111. Thus, those allegations remain time-barred.

Moreover, an allegation regarding the Employer withholding a cost-of-living wage increase from employees in 2021 is time-barred. Such an allegation would not be closely related to the allegation in the current charge regarding the Employer's potentially unlawful statements during the June 30, 2021 mandatory meetings. [3] The potential violations, one involving Section 8(a)(3) for discriminatorily withholding a wage increase and the other involving Section 8(a)(1) for misrepresenting the Union's position on wage increases, neither involve the same section of the Act or legal theory nor permit the Employer to raise the same or similar defenses. In addition, because the Section 8(a)(3) allegation stems from the Employer's opposition to the organizing campaign in 2019, and the potential unlawful statements in June 2021 occurred years later during first contract bargaining, they do not arise from the same factual situation or sequence of events. Thus, the two allegations arose from two separate events and together cannot satisfy a Redd-I analysis where none of the three prongs of the test can be satisfied. See, e.g., WGE Federal Credit Union, 346 NLRB at 983 (finding Section 8(a)(1) unlawful statement and Section 8(a)(3) unlawful discharge allegations not to be closely related under a Redd-I analysis where the former occurred during an organizing campaign and rested on a legal theory of unlawful interference but the latter occurred after the election during bargaining and rested on the employer's discriminatory motive). In any event, a new allegation regarding the Employer's withholding of a wage increase in 2021 would be untimely because, based on the Employer's past practice, the wage increase would have gone into effect on January 1, 2021, which is still outside of the current charge's 10(b) period. [4]

Finally, we conclude that the Employer's withholding of cost-of-living wage increases in 2019, 2020, and 2021 constitutes one time-barred violation that occurred in 2019 rather than separate and distinct violations that occurred each year from 2019 to 2021. The Board has held that an employer's decision to continue to withhold a wage increase after the initial decision has already been made does not create a continuing violation absent supporting conduct and other violations within the 10(b) period. See Bonwit Teller, Inc. 96 NLRB at 610; Goodall Co., 86 NLRB 814, 815, 844 (1949) (rejecting the argument that an unlawful wage increase is a “continuing violation” because it is reflected in weekly or other recurring payments). Here, because the Employer initially withheld the cost-of-living wage increase in early 2019, well outside of the 10(b) period, its continued withholding of wage increases does not create a timely continuing violation that could overcome the statutory limitation set by Section 10(b). Moreover, because the Employer's withholding of the wage increase in 2021 would have occurred before February 23, 2021, [5] which is the earliest potential date within the Section 10(b) period for the current charge, and because there was no action taken by the Employer to initiate a possible wage increase based on employer past practice, the current case is distinguishable from those finding otherwise. Cf., e.g., General Motors Acceptance Corp., 196 NLRB at 137-38.

Based on the preceding analysis, the Region should dismiss the charge, absent withdrawal. This email closes this case in Advice. Please contact us with any questions or concerns.

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