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Beaman v. Yakima Valley Disposal Inc.

April 4, 1991


En Banc. Durham, J. Brachtenbach, Dolliver, Andersen, and Smith, JJ., and Callow, J. Pro Tem., concur. Guy, J., Dore, C.j., and Utter, J., dissent by separate opinion; Johnson, J., did not participate in the disposition of this case.

Author: Durham

Rick Beaman brought a state law wrongful discharge action against his employer. The action was based on the terms of an implemented offer effectuated by the employer after the collective bargaining agreement expired and the parties were unable to reach a new agreement.*fn1 The trial court concluded that the action was preempted by federal labor law under the "potentially subject to" test of San Diego Bldg. Trades Coun. v. Garmon, 359 U.S. 236, 3 L. Ed. 2d 775, 79 S. Ct. 773 (1959). Because the action properly belonged in federal court, it was dismissed. We affirm.

Beaman worked for Yakima Valley Disposal, Inc. (Valley) from 1978 until he was terminated on September 29, 1987. While Beaman was employed at Valley, the employees of Valley were represented by Teamsters Local 524 (Union). On March 1, 1986, the collective bargaining agreement reached in 1983 expired.*fn2 The parties were unable to reach a successor agreement and on June 1, 1986, Valley implemented its final offer.

Valley told Beaman that the implemented offer would be his new employment contract. The implemented offer provided that "[d]iscipline and discharge shall be for just cause." It also provided grievance procedures to be followed by any employee challenging a discharge as being imposed without just cause.

Beaman was discharged on September 29, 1987. He told his supervisors that he felt he had been unfairly discharged without just cause. He was not reinstated. On November 16, 1987, Beaman contacted a Union representative about the discharge. On November 18, a Union business representative wrote to Valley stating that the Union wished to meet with Valley to grieve the discharge pursuant to the terms of the implemented offer.

In a letter written December 3, 1987, Valley denied the Union's request for a meeting. The denial was based on Valley's assertions that the Union had abandoned its interest and that Beaman had failed to follow the grievance procedures.

On January 20, 1988, Beaman filed a complaint against Valley alleging "violation of promises of specific treatment in specific situations", discharge in violation of public policy, and claims for unpaid overtime. The first cause of action is based on Thompson v. St. Regis Paper Co., 102 Wash. 2d 219, 685 P.2d 1081 (1984), a case in which this court modified the common law doctrine of employment at will. Thompson held:

[I]f an employer, for whatever reason, creates an atmosphere of job security and fair treatment with promises of specific treatment in specific situations and an employee is induced thereby to remain on the job and not actively seek other employment, those promises are enforceable components of the employment relationship.

Thompson, at 230.

On May 24, 1988, Valley moved to dismiss Beaman's first cause of action as being preempted by the Labor Management Relations Act, 1947, 29 U.S.C. § 141 et seq. In the alternative, Valley moved for partial summary judgment as to the first cause of action. The other causes of action were

not subject to the motions. On July 1, 1988, the trial court found that Beaman's first cause of action was preempted and granted Valley's motion to dismiss.

The trial court first noted that there was no evidence that the Union had been decertified or that Valley had withdrawn its recognition of the Union. Further, because there were Union contacts with the employer "right up until the end of 1987", the court said that it could not find there had been abandonment of interest by the Union. The court went on to say that resolution of the state cause of action would require resolution of issues within the province of the National Labor Relations Board (NLRB), including questions of impasse, the legal status, effect, and enforceability of the implemented offer, and the legal status of the Union. In granting Valley's motion to dismiss, the court stated that the "potentially subject to" test of San Diego Bldg. Trades Coun. v. Garmon, 359 U.S. 236, 3 L. Ed. 2d 775, 79 S. Ct. 773 (1959) required a ruling in Valley's favor.

An order of dismissal was entered on July 20, 1988 and Beaman appealed. The Court of Appeals certified the case to this court.*fn3

We begin with a caveat. This opinion does not decide which party was right or wrong. The only issue before us is jurisdiction; that is, if the federal court or the state court should be the ultimate finder of fact. By ruling in either party's favor on the jurisdictional issue, we in no way indicate approval of that party's conduct in the underlying action. Any party in these circumstances can properly raise

jurisdictional issues and our ruling on them is separate and distinct from assessing the factual merits of the case. Indeed, many facts relevant to the ultimate resolution of this case are not to be found in this record. Moreover, as the trial court noted, the important issues of impasse, the legality of the implemented offer, and the legal status of the Union itself are not for this court to decide. Any attempt to weigh the evidence on the limited record before us would not only be premature, but could easily lead to hasty and conjectural conclusions. By focusing on the subject matter of this case as opposed to the facts, it is possible to properly limit our inquiry and not stray into the province of the eventual finder of fact.

[1] Our discussion begins with a brief overview of preemption as it has been applied to the area of labor law. Preemption of state law is a purely jurisdictional issue. International Longshoremen's Ass'n v. Davis, 476 U.S. 380, 391, 90 L. Ed. 2d 389, 106 S. Ct. 1904 (1986). Congress' power to preempt state law is derived from the Supremacy Clause of article 6 of the federal constitution. Gibbons v. Ogden, 22 U.S. (9 Wheat.) 1, 6 L. Ed. 23 (1824). Congressional power to legislate in the area of labor relations is long established. NLRB v. Jones & Laughlin Steel Corp., 301 U.S. 1, 81 L. Ed. 893, 57 S. Ct. 615, 108 A.L.R. 1352 (1937). However, because "[t]he precise extent to which state law must be displaced . . . has never been determined by the Congress", the Supreme Court has said it "cannot declare pre-empted all local regulation that touches or concerns in any way the complex interrelationships between employees, employers, and unions; obviously, much of this is left to the States." Amalgamated Ass'n of St., Elec. Ry. & Motor Coach Employees v. Lockridge, 403 U.S. 274, 289, 29 L. Ed. 2d 473, 91 S. Ct. 1909 (1971). Deciding if a state action is preempted by federal law requires review of congressional intent. Garner v. Teamsters, Local Union 776, 346 U.S. 485, 488, 98 L. Ed. 228, 74 S. Ct. 161 (1953). "'The purpose of Congress is the ultimate touchstone.'"

Malone v. White Motor Corp., 435 U.S. 497, 504, 55 L. Ed. 2d 443, 98 S. Ct. 1185 (1978) (quoting Retail Clerks Int'l Ass'n, Local 1625 v. Schermerhorn, 375 U.S. 96, 103, 11 L. Ed. 2d 179, 84 S. Ct. 219 (1963)). Congressional intent to preempt, however, often is not clear.

[I]n such instances, the courts normally sustain local regulation of the same subject matter unless it conflicts with federal law or would frustrate the federal scheme, or unless the courts discern from the totality of the circumstances that Congress sought to occupy the field to the exclusion of the States.

Malone, at 504.

In the area of labor law, three theories of preemption have developed: preemption based on section 301 of the National Labor Relations Act (NLRA); the Machinists doctrine, found in Lodge 76, Int'l Ass'n of Machinists v. Wisconsin Empl. Relations Comm'n, 427 U.S. 132, 49 L. Ed. 2d 396, 96 S. Ct. 2548 (1976); and the Garmon doctrine, found in San Diego Bldg. Trades Coun. v. Garmon, 359 U.S. 236, 242, 3 L. Ed. 2d 775, 79 S. Ct. 773 (1959).

The parties agree that section 301 preemption, which addresses "[s]uits for violation of contracts between an employer and a labor organization", 29 U.S.C. § 185(a), does not apply because there was no collective bargaining agreement in effect for the court to interpret. Valley argues that Beaman's claim is preempted under both the Machinists doctrine and the Garmon doctrine. Because we agree that Beaman's cause of action is preempted under Garmon, we need not decide the applicability of the Machinists doctrine.*fn4 Accordingly, our discussion is limited to the application of the Garmon doctrine.

[2] Congress entrusted the administration of labor policy to a centralized administrative agency, with a specially constituted tribunal to insure uniform application of its

substantive rules and to avoid conflicts inherent in a multiplicity of tribunals and a diversity of procedures. Garmon, at 242-43.

When it is clear or may fairly be assumed that the activities which a State purports to regulate are protected by § 7 of the National Labor Relations Act, or constitute an unfair labor practice under § 8, due regard for the federal enactment requires that state jurisdiction must yield. . . . Nor has it mattered whether the States have acted through laws of broad general application rather than laws specifically directed towards the governance of industrial relations. . . .

At times it has not been clear whether the particular activity regulated by the States was governed by § 7 or § 8 or was, perhaps, outside both these sections. But courts are not primary tribunals to adjudicate such issues. It is essential to the administration of the Act that these determinations be left in the first instance to the National Labor Relations Board.

(Footnote omitted.) Garmon, at 244-45.

When an activity is arguably subject to § 7 or § 8 of the Act, the States as well as the federal courts must defer to the exclusive competence of the National Labor Relations Board if the danger of state interference with national policy is to be averted.

Garmon, at 245.

The governing consideration is that to allow the States to control activities that are potentially subject to federal regulation involves too great a danger of conflict with national labor policy.

(Footnote omitted.) Garmon, at 246.*fn5 Thus, Garmon stands for the principle that potential, rather than actual, conflict is enough to warrant preemption.

Garmon went on to note two exceptions to this "potentially subject to" test. Preemption of state jurisdiction is not required "where the activity regulated was a merely peripheral concern of the Labor Management Relations Act", Garmon, at 243, or "where the regulated conduct touch[es] interests so deeply rooted in local feeling and

responsibility that, in the absence of compelling congressional direction, [it] could not [be inferred] that Congress had deprived the States of the power to act." (Footnote omitted.) Garmon, at 244. The Supreme Court has "refused to apply the Garmon guidelines in a literal, mechanical fashion." (Footnote omitted.) Sears, Roebuck & Co. v. San Diego Cy. Dist. Coun. of Carpenters, 436 U.S. 180, 188, 56 L. Ed. 2d 209, 98 S. Ct. 1745 (1978).

"[T]he decision to pre-empt . . . state court jurisdiction over a given class of cases must depend upon the nature of the particular interests being asserted and the effect upon the administration of national labor policies" of permitting the state court to proceed. Vaca v. Sipes, 386 U. S. 171, 180 [17 L. Ed. 2d 842, 87 S. Ct. 903 (1967)].

(Footnote omitted.) Sears, at 189.

Having set forth the parameters of the Garmon doctrine, we now turn to its application. Under Garmon, Beaman's cause of action must be preempted if it is even "potentially subject to" sections 7 or 8 of the NLRA. Garmon, at 245. Valley does not contend that section 7, which sets forth protected rights of employees, applies to this case. Rather, Valley asserts that preemption is required under section 8, which prohibits certain activities by employers or unions as unfair labor practices. Valley points specifically to sections 8(a)(5) and (d) of the NLRA which relate to collective bargaining. 29 U.S.C. § 158(a)(5), (d). Section 8(a)(5) makes it an unfair labor practice to refuse to bargain collectively with a representative union and section 8(d), in part, imposes a duty of good faith on the parties to the collective bargaining process.

Resolution of Beaman's first cause of action would necessarily touch on Valley's good faith bargaining and, furthermore, would require the court to determine several issues reserved to the primary jurisdiction of the NLRB. The court would have to determine if a valid impasse was reached, if the implemented offer was lawful, and, if not, what terms of the expired contract remain in effect, the legal status of the Union, and if Valley's refusal to deal with the Union was a violation of the NLRA.

There is no evidence in the record that a determination of impasse was ever requested or made. More importantly, the existence of an impasse does not end the party's obligation to bargain in good faith; the duty is merely suspended. 1 C. Morris, Developing Labor Law 636 (2d ed. 1983). Furthermore, during an impasse, an employer "may not take action disparaging to the collective bargaining process or amounting to a withdrawal of recognition of the union's representative status." (Footnote omitted.) 1 C. Morris, at 636.

Despite references in his brief to his "former" Union, Beaman acknowledges that determination of the Union's status is within the NLRB's primary jurisdiction. Thus, he does not directly challenge the trial court's statements regarding withdrawal, decertification and abandonment. Instead, he argues that the passage of time alone, absent active bargaining, should somehow allow him to disregard the Union's presence. Further, Beaman concedes that the issues of impasse and valid implementation lie within the primary jurisdiction of the NLRB. Most importantly, he concedes that the issues involving the validity of the terms of the expired contract and the effect of Valley's refusal to deal with ...

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