April 24, 2014

Tenth Circuit: Importance of Preserving Your Best Arguments in the Proper Administrative Forum

The Tenth Circuit published its opinion in Public Service Company of New Mexico v. National Labor Relations Board on August 28, 2012.

Robert Madrid worked for Public Service Company of New Mexico (PNM), collecting overdue bills for the electric utility. Angered by a particularly obstinate customer and without his supervisor’s permission, Mr. Madrid drove to the customer’s home and disconnected the gas line that was not provided by PNM, but another utility. PNM fired Mr. Madrid.  Mr. Madrid’s union filed a grievance on his behalf contesting his dismissal. The union argued that Mr. Madrid’s firing violated its collective bargaining agreement with the company. The union hypothesized that Mr. Madrid may have treated more harshly than other employees guilty of similar things.

The union sent PNM a discovery request demanding documents showing whether and to what extent PNM had disciplined other employees who, like Mr. Madrid, violated the company’s ethics policy or state law.

PNM provided documents disclosing disciplinary actions taken against union employees, but it refused to provide information about discipline meted out on non-union workers.  The company argued that information about non-union employees was irrelevant. PNM eventually handed over the requested documents. However, because of its many months of delay, the Board found that PNM had engaged in an unfair labor practice.  The Board ordered PNM to post a notice informing employees of their rights under the law, PNM’s violation, and the company’s promise to do better going forward.

PNM now petitions the Tenth Circuit for review of the Board’s decision and the Board cross-petitions asking us to enforce its order.  The only question the company raises on appeal is whether the disciplinary information about non-union employees was relevant to the union’s processing of Mr. Madrid’s grievance.

The most significant relevance objections PNM seeks to press in the Tenth Circuit never made their way into the proceedings before the Board. And under 29 U.S.C. § 160(e),  “No objection that has not been urged before the Board, its member, agent, or agency, shall be considered by the court, unless the failure or neglect to urge such objection shall be excused because of extraordinary circumstances.”

The Tenth Circuit divided PNM’s appeal into two parts: the set of objections it preserved by raising them with the Board, and the set it did not.

Taking the first group first, the Court agreed to hear PNM’s claims that (1) information about the discipline of non-union employees is irrelevant because non-union employees aren’t “similarly situated” to union employees, (2) the union was obliged to timely explain the relevance of its information; and (3) the union’s request was motivated by an improper purpose.

Regarding PNM’s first objection, because the rules serving as the basis for Mr. Madrid’s termination applied to union and non-union employees equally, the documents were held to be relevant. In response to the second objection, the Court found the record contained substantial evidence that the union did timely apprise PNM of the basis for its request. In response to PNM’s third objection, the Court held that PNM did not carry its burden to show affirmatively that the Board’s findings are ones no reasonable mind could accept.

The Court held it had no authority to hear the remainder of PNM’s objections because PNM never raised them with the Board as required by 29 U.S.C. § 160(e). Accordingly, PNM’s petition for review was denied, and the Board’s cross-petition for enforcement of its order was granted.

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