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NISH NOROIAN FARMS, Petitioner, v. AGRICULTURAL LABOR RELATIONS BOARD, Respondent, UNITED FARM WORKERS OF AMERICA, AFL–CIO, Real Party in Interest.
Petitioner Nish Noroian Farms filed a petition for writ of review of the final decision and order of respondent Agricultural Labor Relations Board (ALRB or Board) in the matter of Nish Noroian Farms (1982) 8 ALRB No. 25. This court granted the petition as to the following issues: 1) whether petitioner, the ALRB, and real party in interest United Farm Workers of America, AFL–CIO (UFW) had settled all bad faith bargaining charges against petitioner for conduct prior to May 8, 1978; 2) whether petitioner was under a duty to bargain with the UFW over its decision to change its hiring policy in Arizona, which change resulted in the failure to rehire two California employees who had previously been laid-off; and 3) whether the Board's remedial order was appropriate.
Nish Noroian Farms (petitioner) is a sole proprietorship engaged in agriculture. It operates its business both in California and Arizona. On November 30, 1976, real party in interest, the United Farm Workers of America, AFL–CIO (UFW) was certified as the collective bargaining representative for certain employees of petitioner.
By November 1977, before the parties had entered into any collective bargaining agreement, the UFW filed several bad faith bargaining charges against petitioner.1 On February 24, 1978, the UFW filed yet another charge against petitioner. This later charge alleged that petitioner had laid-off and refused to rehire Emiliano Becerril on the basis of his union activities.
On May 8, 1978, a collective bargaining agreement was entered into by petitioner and the UFW. The agreement included a stipulated settlement in which petitioner agreed to pay $24,772.93 into a fund for distribution to certain of its employees. In addition, both parties agreed to lay to rest the existing refusal to bargain charges, all of which concerned aspects of the agreement and its negotiation. Finally, the parties agreed to a mutual waiver of “any and all unfair labor charges alleging bad faith bargaining for conduct as of the date of the signing of this agreement.” The charge alleging discrimination against Becerril was excluded from the agreement and left to be litigated separately.
On July 12, 1978, the regional director for the ALRB dismissed the Becerril discrimination charge against petitioner and noted that the lay-off was the result of “good business judgment.” The UFW appealed this dismissal to the General Counsel of the ALRB who, on August 10, 1978, affirmed the regional director's finding that no adequate showing of discrimination had been made. However, the General Counsel remanded the case to the regional director for further investigation of petitioner's act of “good business judgment.” The General Counsel indicated that petitioner's refusal to rehire Becerril, a California resident who had worked as an irrigator for petitioner in both California and Arizona, appeared to be due to its unilateral decision to hire only Arizona citizens to irrigate its Arizona properties. This unilateral change in hiring policy was a potential violation of Labor Code section 1153, subdivisions (a) 2 and (e).3
On this same date, petitioner signed the formal Board Settlement Agreement which had been prepared by the attorney for the General Counsel of the ALRB. This agreement was later signed by a representative of the UFW and approved and signed by the ALRB. This formal Settlement Agreement had been fashioned after, and incorporated, the May 8, 1978, settlement agreement between petitioner and the UFW. The Board Settlement Agreement, however, set forth the exclusion for the charge involving Becerril in broader terms than had the May 8th agreement. The May 8th agreement had specifically excluded from settlement the Becerril discrimination charge: “Charge 77–CE–141–3–E [later changed to 78–CE–10–E] is not affected by the settlement agreement, and will be litigated separately.” In contrast the Board Settlement Agreement provided that “the alleged layoff and failure by [petitioner] to rehire Emiliano Becerril ․ will abide further investigation and independent resolution by the Board.”
Thereafter, on January 12, 1979, the ALRB issued a complaint against petitioner which bore the same case number as had the Becerril discrimination charge but which, instead, alleged that petitioner had violated section 1153, subdivisions (a) and (e) by its bad faith refusal to bargain over its change in Arizona hiring policy. The complaint stated, in pertinent part, that “7. On or about December 22, 1977 Emiliano Becerril and John Does 1–10 were laid off by ․ Nish Noroian. On or about February 18, 1978 [Nish Noroian] refused to rehire Emiliano Becerril and John Does 1–10. [¶] 8. Sometime on or about December, 1977, January 1978 or February 1978 ․ Nish Noroian instituted and implemented a new policy regarding the hiring of California workers to do work on its Arizona properties. [¶] 9. It was pursuant to this new policy that ․ Nish Noroian refused to rehire Emiliano Becerril and John Does 1–10 on or about February 18, 1978.” The complaint was later amended to include Arturo Baca as a casualty of petitioner's change in policy.
Petitioner filed a motion to dismiss the complaint on the grounds that both petitioner and the UFW had waived all bad faith bargaining charges for conduct prior to May 8, 1978. The Administrative Law Officer (ALO) denied the motion on grounds that the UFW had no notice of this particular violation when it entered into the May 8, 1978 settlement agreement and that ALRB policy and rules of contract construction allowed the excluded charge regarding Becerril to be interpreted broadly. The ALO also determined that petitioner had violated section 1153, subdivisions (a) and (e) by “eliminating the use of employees who resided in California as Irrigators at its Arizona operations” without notifying the employees' certified representative about the impact of the change on their wages, hours and working conditions.
The Board affirmed the Administrative Law Officer's decision only to the extent it was consistent with its own opinion. The Board agreed that ALRB policy would allow the Becerril discrimination exclusion to include a bad faith bargaining charge, despite the May 8, 1978, settlement agreement language waiving all such charges for conduct prior to that date. The Board reasoned that the exact nature of the illegal conduct which resulted in petitioner's refusal to rehire Becerril was largely irrelevant. “[T]he ultimate issue of whether Becerril has any recourse under the Act for his loss of employment remains the same. With the same ultimate issue thus at stake, we cannot see how it would serve the purposes of the Act to permit litigation of the question whether [petitioner's] motive was unlawful, but not whether its conduct was.” (Nish Noroian Farms (1982) 8 ALRB No. 25 at pp. 4–5.) The Board responded to petitioner's contention that it had no duty to bargain at all over work performed in Arizona by stating that “We do not need to reach this question, however, since [petitioner] did not eliminate only Arizona work when it changed its dual-state irrigator policy, it eliminated the California component of Becerril's work as well. Thus, it unilaterally eliminated California unit work.” (Id., at p. 5.)
The ALRB then ordered petitioner, among other things not relevant here, to “Take the following affirmative actions which are deemed necessary to effectuate the policies of the Act:
“(a) Offer employees Emiliano Becerril and Arturo Baca immediate and full reinstatement to their former or substantially equivalent jobs as irrigators without prejudice to their seniority or other employment rights and privileges.
“(b) Make Emiliano Becerril and Arturo Baca whole for any loss of pay and other economic losses they have suffered as a result of their layoff, reimbursement to be made according to the formula stated in J & L Farms (Aug. 12, 1980) 6 ALRB No. 43, plus interest thereon at the rate of seven percent per annum.
“(c) Preserve and, upon request, make available to the Board or its agents, for examination, photocopying, and otherwise copying, all payroll records, social security payment records, time cards, personnel records and reports, and all other records relevant and necessary to a determination, by the Regional Director, of the backpay period and the amount of the backpay due under the terms of this Order.
“(e) Mail copies of the attached Notice, in all appropriate languages, within 30 days after the date of issuance of this Order, to all employees employed by [Petitioner] at any time during the period from September 24, 1980, until the date on which the said Notice is mailed.
“(g) Arrange for a representative of [Petitioner] or a Board agent to distribute and read the attached Notice, in all appropriate languages, to its employees on company time and property at time(s) and place(s) to be determined by the Regional Director. Following the reading, the Board agent shall be given the opportunity, outside the presence of supervisors and management, to answer any questions the employees may have concerning the Notice or employees' rights under the Act. The Regional Director shall determine a reasonable rate of compensation to be paid by [Petitioner] to all nonhourly wage employees in order to compensate them for time lost at this reading and during the question-and-answer period.” (Id., at pp. 17–18.)
Petitioner then petitioned this court for a writ of review. We granted the writ as to the issues discussed above.
I. The Settlement Agreement
Petitioner claims that public policy considerations compel this court to construe its settlement agreement with the UFW and ALRB as a complete waiver of all bad faith bargaining charges. We refuse to do so because of the clear language of the agreement itself.
It is true, as petitioner contends, that the National Labor Relations Board (NLRB), after whose model the ALRB was fashioned, refuses “to consider as evidence of unfair labor practices conduct of a [petitioner] antedating a settlement agreement, unless the [petitioner] has failed to comply with the settlement agreement or has engaged in independent unfair labor practices since the settlement.” (Larrance Tank Corporation (1951) 94 NLRB 352, 353, fn. omitted.) Yet, the NLRB has recognized exceptions to this general rule where: 1) prior violations were not known of or readily discoverable at the time of the agreement, or 2) “where it concerns an issue specifically reserved from the settlement by mutual understanding of the parties.” (Steves Sash & Door Company (1967) 164 NLRB 468, 473, enforced, Steves Sash & Door Co. v. NLRB (1968) 401 F.2d 676.)
A. Emiliano Becerril
As noted above, the settlement agreement specifically excluded from its terms the then-pending discrimination charge concerning Becerril. Although petitioner concedes that the Board was left free, under the terms of the agreement, to prosecute this charge, it argues that once the discrimination charge was dismissed, the agreement precluded the Board from amending the charge to include a “bad faith bargaining” violation. Were we limited to consideration of the May 8th settlement agreement, petitioner's argument would be compelling. However, the subsequent formal Board Settlement Agreement, which incorporated the May 8th agreement, left the Becerril charge open to “further investigation and independent resolution by the Board.” Petitioner's representative signed the Board settlement agreement on August 10, 1978. It was on this same date that the General Counsel for the ALRB affirmed the Regional Director's finding that no evidence existed to support the discrimination charge, and remanded the case for investigation into a possible bad faith bargaining charge.
In determining the intent of contracting parties, we look to their expressed intent as set forth in the contract itself. (Civ.Code, § 1636; Mission Valley East, Inc. v. County of Kern (1981) 120 Cal.App.3d 89, 97, 174 Cal.Rptr. 300; Healy Tibbitts Constr. Co. v. Employers' Surplus Lines Ins. Co. (1977) 72 Cal.App.3d 741, 748, 140 Cal.Rptr. 375; Rest., Contracts § 230.) A contract is to be interpreted as a whole and every part may be taken into consideration when determining the meaning of every other part. (Civ.Code, § 1641; Rosen v. E.C. Losch Co. (1965) 234 Cal.App.2d 324, 330, 44 Cal.Rptr. 377; Rest., Contracts, § 235(c).) When more than one writing are parts of one agreement, these parts are to be construed together. (Civ.Code, § 1642; Berg Metals Corp. v. Wilson (1959) 170 Cal.App.2d 559, 567, 339 P.2d 869.)
The formal Board Settlement Agreement expressly incorporated the prior May 8th agreement between petitioner and the UFW. The May 8th agreement contained two provisions which are relevant to this discussion: the Becerril discrimination charge exclusion and the mutual waiver of “any and all unfair labor charges alleging bad faith bargaining for conduct as of the date of the signing of this agreement.” Petitioner focuses on the language contained in the May 8th agreement but, understandably, fails to comment on the broad language contained in the subsequent agreement which provided that “the alleged layoff and failure by [petitioner] to rehire Emiliano Becerril ․ will abide further investigation and independent resolution by the Board.” When these provisions are construed together it becomes apparent that the parties intended that the ALRB be given an opportunity to pursue the matter of petitioner's alleged improper refusal to rehire Becerril. It is equally apparent that if impropriety were found, the remedy was not to be limited to a discrimination charge. The agreement specifically provided that petitioner's lay off and refusal to rehire Becerril would abide further investigation.
Petitioner's argument that the waiver provision prevented a bad faith bargaining charge on Becerril's behalf is not convincing. The waiver provision is general in its terms, where the exclusion is quite specific. General rules of contract construction provide that “[w]here general and specific provisions are inconsistent, the specific provision will control.” (1 Witkin, Summary of Cal.Law (8th ed. 1973) Contracts, § 533, p. 454; Code Civ.Proc., § 1859; Rest. Contracts, § 236(c).) We, therefore, conclude that petitioner specifically granted the Board permission to proceed with its investigation regardless of the exact nature of the charges eventually to be filed.
Our conclusion is supported, further, by looking to the customary meaning given to the phrase “[the charge] will abide further investigation and independent resolution by the Board.” This phrasing recognized the Board's practice of subjecting an initial charge to investigation before it determines how to draw the complaint. This investigatory practice can result in the complaint's inclusion of additional prohibited conduct and legal theories. (See, e.g., John Elmore, Inc. (1978) 4 ALRB No. 98, op. ALO pp. 36–37.)
Petitioner argues that this construction of the settlement agreement runs counter to well-established Board policy which upholds settlement agreements as a means of restoring “as effectively and expeditiously as possible, the labor peace which it is the purpose of the Act to achieve.” (Fox River Pattern, Inc. (1972) 199 NLRB 68, 70, enforced, Fox River Pattern v. NLRB, 483 F.2d 1406, cert. den., 416 U.S. 938, 94 S.Ct. 1939, 40 L.Ed.2d 289.) Petitioner cites John J. Elmore (1980) 6 ALRB No. 7, as dispositive of the issue in this case.
In Elmore, Castellanos, an employee, filed a charge against his employer which alleged that he had been discriminatorily laid off because of his activities on behalf of the UFW. This charge was dismissed for lack of foundation. Yet, while the employer and the UFW were engaged in negotiating a collective bargaining agreement, the Regional Director discovered evidence which indicated that there was some basis to Castellanos' charge that the employer had previously changed its subcontracting practices without bargaining with the union. The complaint issued two months after the parties signed the collective bargaining agreement. In this case the Board refused to go behind the settlement agreement because “[t]he UFW, the chosen and certified bargaining representative of Respondent's employees, never filed a charge alleging that Respondent failed to discharge its statutory duty to bargain with the Union. The UFW did not participate in the hearing, not even to the extent of offering evidence about the bargaining history between Respondent and the Union. The UFW did not, in fact, enter this case until after the issuance of the ALO's Decision when as intervenor it filed exceptions thereto.” (Id., at p. 4.) It was in this substantially different context that the Board found that the policy of promoting stability in labor relations through collective bargaining foreclosed it from considering the bad faith bargaining allegation.
The circumstances surrounding the case before us warrant the opposite result as to Becerril. Here the UFW bargained for the opportunity to litigate Becerril's case. As evidenced by the contract itself, the parties specifically excluded this charge from the settlement agreement. It follows from this that the settlement agreement was never intended to lay all disputed matters to rest. We, therefore, do no “disservice to the parties involved [nor] to the policies of the Act” (Fox River Pattern, Inc., supra, 199 NLRB 68, 70) by finding that the bad faith bargaining charge, as to Becerril, was excluded from the settlement agreement.
B. Arturo Baca
The case is not so clear with regard to Baca. There was no mention of Baca in the exclusion to the settlement agreement. Our initial conclusion, therefore, would be that the charge on his behalf is barred by the parties' mutual waiver of “any and all unfair labor charges alleging bad faith bargaining for conduct as of the date of the signing of this agreement.”
However, it appears that petitioner waived its right to object to Baca's inclusion in the charge by not raising the issue before the Board itself. The Board cites two instances of petitioner's failure to object. The first was during the initial hearing at which the Board moved to substitute Arturo Baca for “John Doe I” in the complaint. At that time counsel for petitioner stated: “I would like to object to Baca but I can't think of any reason, so I have no objection to that.” The second instance was petitioner's failure to file an exception to the ALO's decision specifically contesting the inclusion of Baca in the complaint. Petitioner, further, failed to specifically raise this issue on appeal. Upon our request, however, it did address itself to this issue. In its argument it asserts that “Since Mr. Baca's charge relates solely to bad faith bargaining, occurring prior to the signing of the settlement agreement, it is plain that his charge along with any other bargaining allegations were waived by the UFW and the ALRB.”
A party who fails to object to an erroneous ruling or a procedural error at trial waives its right to appeal the ruling. “The law casts upon the party the duty of looking after his legal rights and of calling the judge's attention to any infringement of them. If any other rule were to obtain, the party would in most cases be careful to be silent as to his objections until it would be too late to obviate them, and the result would be that few judgments would stand the test of an appeal.” (Sommer v. Martin (1921) 55 Cal.App. 603, 610, 204 P. 33; Bardessono v. Michels (1971) 3 Cal.3d 780, 91 Cal.Rptr. 760, 478 P.2d 480; Chamberlain v. Ventura County Civil Service Com. (1977) 69 Cal.App.3d 362, 372, 138 Cal.Rptr. 155; 6 Witkin, Cal.Procedure (2d ed. 1971) Appeal, § 276, pp. 4264–4265.) We conclude that Baca was properly included in the complaint because petitioner expressly waived its right to object to such inclusion at the Board hearing. It may not now raise this issue on appeal.
II. Change in hiring policy
We now turn to petitioner's contention that it was not under any legal duty to bargain with the UFW over its change of hiring policy in Arizona.
There is no question that “an employer may not unilaterally attempt to divert work away from a bargaining unit without fulfilling his statutory duty to bargain ․” (Road Sprinkler Fitters Local U., etc. v. N.L.R.B. (1982) 676 F.2d 826, 831; N.L.R.B. v. Borg Warner Corp. (1981) 663 F.2d 666, cert. den. (1982) 457 U.S. 1105, 102 S.Ct. 2903, 73 L.Ed.2d 1313.) Petitioner's argument that it is not bound by the ALRA for acts it commits in Arizona, and that the Board's attempted assertion of authority over it violates the Full Faith and Credit Clause of the United States Constitution, stems from its dispute with the Board's finding that its change in Arizona hiring policy caused the unavailability of bargaining unit work in California.
Petitioner contends that the loss of available work in California was independent of its actions in Arizona. Therefore, petitioner argues, the ALRB is attempting to regulate the working conditions, etc. of Arizona farmworkers. Petitioner's argument is defeated simply by examining the record to determine whether sufficient evidence exists to sustain the Board's finding that petitioner's change in Arizona hiring policy resulted in a loss of California unit work.
The Board's findings will be upheld if, from a review of the record as a whole, they are supported by substantial evidence. (Tex-Cal Land Management, Inc. v. Agricultural Labor Relations Bd. (1979) 24 Cal.3d 335, 156 Cal.Rptr. 1, 595 P.2d 579; Royal Packing Co. v. Agricultural Labor Relations Bd. (1980) 101 Cal.App.3d 826, 835–836, 161 Cal.Rptr. 870.)
“[T]he ․ accepted test for whether work has been transferred away from a bargaining unit is whether, as a result of decisions by the employer, the bargaining unit in question has suffered an adverse impact.” (Road Sprinkler Fitters Local U., etc. v. N.L.R.B., supra, 676 F.2d at p. 831.) The record indicates that prior to petitioner's change in Arizona hiring policy, irrigation of its California crops was performed by several irrigators. Both Becerril and Baca worked as California irrigators. Once petitioner changed its hiring policy, the California irrigation was performed by only two workers, and Becerril and Baca were never rehired. Despite this substantial change in petitioner's California operations and its concomitant effect on Becerril and Baca, the union was never given advance notice of the change or an opportunity to bargain about it. These facts support the Board's conclusion.
Once this is established, the issue becomes one of whether the Board exceeded its jurisdiction by applying the ALRA to the California effects of petitioner's change in Arizona hiring policy. We first look to see whether petitioner has such minimum contacts with the state of California as to satisfy “traditional notions of fair play and substantial justice.” (International Shoe Co. v. Washington (1945) 326 U.S. 310, 316, 66 S.Ct. 154, 158, 90 L.Ed. 95, 102, 161 A.L.R. 1057; Sibley v. Superior Court (1976) 16 Cal.3d 442, 446, 128 Cal.Rptr. 34, 546 P.2d 322, cert. den., 429 U.S. 826, 97 S.Ct. 82, 50 L.Ed.2d 89.) Petitioner is licensed to do business in the state of California and does so on a continuous and systematic basis. It benefits from the laws of this state. The effect of petitioner's change in Arizona hiring policy was an injury to Becerril and Baca in California. For these reasons, we find that the Board's assertion of in personam jurisdiction over petitioner was in conformity with “traditional notions of fair play and substantial justice.”
It is equally clear that the Board properly asserted subject matter jurisdiction over this case. In enacting the Agricultural Labor Relations Act (ALRA) the California Legislature sought to protect the class of which Baca and Becerril are members (see §§ 1140.2 et seq.). “[B]y the passage of the ALRA the Legislature has chosen to regulate the employment relation in California agriculture by providing for a system of collective bargaining with the attendant array of statutory rights, obligations, and prohibitions necessary to the proper functioning of such a system. Its authority to do so in connection with the purely intrastate activities of agricultural employers, unions, and employees is clear.” (Mario Saikhon, Inc. (1978) 4 ALRB No. 72 at p. 6.) In addition, the very formation of the employer-employee relationship within California gives the state a sufficient jurisdictional basis, commensurate with due process, to regulate the incidents of that relationship, even when it involves the rendition of services within another state. (Alaska Packer's Asso. v. Industrial Acci. Com. of Cal. (1935) 294 U.S. 532, 540, 55 S.Ct. 518, 79 L.Ed. 1044, 1048.) Surely, to the extent that petitioner's change in Arizona had an adverse impact on labor relations in California, the Board was justified in asserting subject matter jurisdiction over petitioner.
Because we have determined that there is substantial evidence to support the Board's finding that the loss of available work in California was directly related to petitioner's change in Arizona hiring policy, the outcome is clear. The California Board has both personal and subject matter jurisdiction over petitioner and the effect its change in hiring policy had on California farmworkers.
Petitioner's argument that the Board's assertion of jurisdiction violates the Full Faith and Credit Clause is misplaced. “[T]he Full Faith and Credit Clause does not require [California] to apply [Arizona] law in violation of its own legitimate public policy.” (Nevada v. Hall (1979) 440 U.S. 410, 422, 99 S.Ct. 1182, 1189, 59 L.Ed.2d 416, 426 reh. den., 441 U.S. 917, 99 S.Ct. 2018, 60 L.Ed.2d 389.) Because the Board's action in no way infringed on Arizona's right to govern labor disputes within its own boundaries, we find the Board's assertion of jurisdiction and the application of California law to be proper in this case.
The Board's motion to strike petitioner's argument that the unfair labor practice was not properly pleaded and litigated below is denied.
III. The Remedial Order
Petitioner raises several objections to the Board's remedial order.
A. Violations de minimus
Petitioner asserts that its unilateral change in hiring policy was de minimus, and that no remedy is warranted. Petitioner's actions cannot properly be regarded as de minimus because the duty to negotiate before initiating changes affecting the wages and hours of employees is central to the collective bargaining process and to the maintenance of labor peace.
B. Reinstatement and backpay
Petitioner argues that the Board's order to reinstate Becerril and Baca is overly broad because its jurisdiction to order reinstatement is confined to California and there are no jobs available for reinstatement. Although we agree with petitioner that, pursuant to our analysis above, reinstatement must be limited to work in California, whether jobs are available is a question of fact. Petitioner must wait to present its evidence at the compliance phase of this case. The proper amount of damages will also be determined at the compliance phase of this proceeding.
C. Mailing, reading and posting requirements
Petitioner complains that the Board's requirements of mailing, posting and reading the Board's notice to its employees are punitive. We disagree.
“Remedial matters are peculiarly within the discretion of the Board and will not be reviewed in this court except where obviously punitive or beyond the Board's jurisdiction.” (Kawano, Inc. v. Agricultural Labor Relations Bd. (1980) 106 Cal.App.3d 937, 955, 165 Cal.Rptr. 492.) Petitioner has not cited any authority or offered any facts which warrant our review of the Board's mailing, posting and reading requirements. These remedial measures serve the important purpose of informing employees of their rights under the Act. (Jasmine Vineyards, Inc. v. Agricultural Labor Relations Bd. (190) 113 Cal.App.3d 968, 979, 170 Cal.Rptr. 510.) The cost incurred by petitioner in reading the notice to its employees during working hours is insignificant in relation to the purpose served and does not render the remedy inappropriate. (Id., at p. 981, 170 Cal.Rptr. 510.)
D. The J & L Farms formula 4
Petitioner contends that the reimbursement formula set forth in J & L Farms (1980) 6 ALRB No. 43, is punitive, rather than remedial, and is inconsistent with the purposes of the Act. The J & L Farms formula is set forth as follows: “Loss of pay is to be determined by multiplying the number of days the employee was out of work by the amount the employee would have earned per day. If on any day the employee was employed elsewhere, the net earnings of that day shall be subtracted from the amount the employee would have earned at J & L Farms for that day only. The award shall reflect any wage increase, increase in work hours, or bonus given by [J & L Farms] since the discharge. Interest shall be computed at the rate of 7 percent per annum.” (J & L Farms, supra, at p. 2, emphasis added.)
Petitioner argues that the implementation of the emphasized portion of the formula will result in a windfall to the wrongfully discharged employee. “[I]f a claimant would have worked on Monday, Tuesday, Thursday, and Friday of a specific week but for the employer's discrimination, then his interim earnings on Wednesday of that same week will not be offset against the employer's liability. Thus, the employee is placed in a better position than he would have occupied if there had been no discrimination.”
The Board does not dispute petitioner's interpretation of the formula's effect, but rather claims that this result is strictly remedial in nature. It argues that, in the context of the agricultural industry, “[w]here daily turnover of workers is great, and the whole season is four to five months long at most the overall income of a typical agricultural employee may normally be dependent upon some higher and some lower paying jobs during each year. Such an employee would be punished unjustly if his later higher paying jobs resulted in wiping out the backpay he lost after a discriminatory discharge or refusal to rehire.” The Board then concludes that, because the employee could have worked elsewhere on days he was not working for petitioner, “to allow such interim employment to reduce [petitioner's] backpay liability ․ would penalize the discriminatee and reward the wrongdoer.” (Emphasis omitted.)
In reviewing the reasonableness of the J & L Farms formula, we must consider the well-established rule which gives great deference to the Board's remedial decisions. Its order may only be overturned if it has abused its discretionary authority. (Butte View Farms v. Agricultural Labor Relations Bd. (1979) 95 Cal.App.3d 961, 967, 157 Cal.Rptr. 476.) Yet, its discretion is not unbounded and must be exercised reasonably for remedial, not punitive, ends. (Sunnyside Nurseries, Inc. v. Agricultural Labor Relations Bd. (1979) 93 Cal.App.3d 922, 940, 156 Cal.Rptr. 152.)
There is no compelling precedent to guide us in making our decision. The case which the Board claims has implicitly approved this formula (Butte View Farms v. Agricultural Labor Relations Bd., supra, 95 Cal.App.3d 961, 157 Cal.Rptr. 476) did not concern itself with mitigation of backpay awards, but rather determined the pay period most easily used as a basis of computing backpay under the circumstances before it.
The NLRB considered and resolved this issue over thirty years ago in F.W. Woolworth Company (1950) 90 NLRB 289. Prior to its decision in Woolworth, the NLRB had determined the amount of backpay due by taking the amount the employee would have made if not wrongfully discharged and subtracting from it what the employee actually earned “commencing on the date of [discharge] and ending with the date of offer of reinstatement.” (Id., at p. 291.) Yet the Board found that this system was abused by employers who waited long periods of time before offering reinstatement in order to relieve themselves of having to pay any back pay to employees who had subsequently found higher paying jobs. In addition, many employees waived their right of reinstatement in order to toll the running of the backpay period and preserve the amount owed them. In order to remedy these abuses and restore to the injured employee the benefits he would have obtained but for the illegal discharge, the Board severed the backpay period into quarterly units. Under this formula, the injured employee's loss of pay would be determined by deducting his net earnings for other employment during the quarter from the amount he would have earned during that period.
Petitioner urges us to direct the ALRB to adopt this formula. We decline to do so because we believe that the Board is in a better position than we to determine the problems peculiar to the farmworkers and the formula necessary to compute a proper backpay award. We do find, however, that the J & L Farms formula goes beyond the remedial principles set forth in Woolworth and in the ALRA itself.
Under the formula as it presently exists, the wrongfully discharged employee could work on Monday, Wednesday and Friday for another and be paid for his services; but if the original employer had typically hired the employee to work on Tuesday, Thursday and Saturday, the amount of backpay owed would not be diminished at all. As this example demonstrates, the J & L formula is clearly punitive and in formulating it the Board exceeded the strictly remedial authority given it by the Act. (Sunnyside Nurseries, Inc. v. ALRB, supra, 93 Cal.App.3d 922, 940, 156 Cal.Rptr. 152.)
The order of the Agricultural Labor Relations Board is annulled only insofar as it relates to the order to compute backpay due under the J & L Farms formula. The cause is remanded to the Board for their formulation of a backpay formula consistent with the strictly remedial purposes of the Act.
1. Two of these charges concerned the alleged exclusion of the lettuce and watermelon crews from those to be included in collective bargaining negotiations. Two additional charges concerned respondent's alleged failure to actively participate in the bargaining process. These charges were consolidated and scheduled for hearing in March 1978. At the time of the hearing, both parties attempted to settle the charges and negotiate a collective bargaining agreement. This attempt resulted in both parties filing a bad faith refusal to bargain charge against one another.
2. All references are to the Labor Code unless otherwise specified.
3. Section 1153 provides, in pertinent part:“It shall be an unfair labor practice for an agricultural employer to do any of the following:“(a) To interfere with, restrain, or coerce agricultural employees in the exercise of the rights guaranteed in Section 1152.“․“(e) To refuse to bargain collectively in good faith with labor organizations certified pursuant to the provisions of Chapter 5 (commencing with Section 1156) of this part.”
4. The Board has indirectly suggested that petitioner failed to exhaust its administrative remedies by not seeking a rehearing before the Board on the issue of the validity of the J & L Farms formula. We simply note that the Legislature made no provision for rehearing under the ALRA (Lab.Code, § 1160.8; and see Jackson & Perkins Co. v. Agricultural Labor Relations Bd. (1978) 77 Cal.App.3d 830, 833–834, 144 Cal.Rptr. 166; United Farm Workers v. Agricultural Labor Relations Board (1977) 74 Cal.App.3d 347, 350, 141 Cal.Rptr. 437) and the administrative regulation which provides the sole authority for petitions for rehearing limits the procedure as follows: “A party to an unfair labor practice proceeding before the Board may, because of extraordinary circumstances, move for reconsideration․ A motion filed under this section shall not operate to stay the decision and order of the Board.” (Cal.Admin.Code, tit. 8, § 20286, subd. (c).)The exhaustion requirement is inapplicable where there is no effective administrative remedy. (See Sunnyvale Public Safety Officers Assn. v. City of Sunnyvale (1976) 55 Cal.App.3d 732, 735, 127 Cal.Rptr. 863.)
MORRIS, Presiding Justice.
KAUFMAN and RICKLES, JJ., concur.
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Docket No: Civ. 27889.
Decided: April 15, 1983
Court: Court of Appeal, Fourth District, Division 2, California.
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