The Bureau of National Affairs,
DAILY LABOR REPORT
August 29, 2000, Tuesday
SECOND CIRCUIT LETS TWO UNION DISSIDENTS PROCEED WITH LMRDA SUIT AGAINST LABORERS
By Susan J. McGolrick
Two former dissident union members who were refused readmission to Construction and General Laborers' Union Local 230 may proceed with their claims under the Labor Management Reporting and Disclosure Act, the U.S. Court of Appeals for the Second Circuit ruled Aug. 24 (Wall v. Construction and General Laborers' Union, Local 230, 2d Cir., No. 99-7773, 8/24/00).
Reversing summary judgment for the union granted by the U.S. District Court for the District of Connecticut, the appeals court decided the claims of Gary Wall and William Cooksey were not barred by a three-year statute of limitations.
Writing for the appeals court, Chief Judge Ralph K. Winter held that the union was equitably estopped from asserting the limitations period as a defense because the two men relied on the union's "false and misleading justifications as to why they could not be readmitted at a particular time, while holding out the promise that readmission would follow referral to a job."
Winter also ruled that the limitations period was tolled while the two men pursued internal union remedies.
The appeals court agreed with the lower court that Wall's and Cooksey's state law claims for blacklisting and tortious interference with employment were preempted by the Labor Management Relations Act because they require interpretation of the union constitution. However, Winter suggested that the two men, on remand to the district court, could replead the claims under Section 301 of the LMRA.
Judges Robert A. Katzmann and William Terrell Hodges joined in the opinion.
Dissidents Charged Union With ULPs.
Wall and Cooksey were longtime union members who vocally disagreed with union leadership and filed unfair-labor-practice charges against the union for discrimination.
The National Labor Relations Board decided in October 1990 that the union removed Wall as shop steward in November 1985 in retaliation for refusing to follow directions to "shake down" laborers for money (300 N.L.R.B. 479).
The board also held the union denied both men jobs through the hiring hall in retaliation for opposing the union leadership.
The parties in January 1992 reached a settlement on remedies owed to the two men.
Cooksey had stopped paying dues in July 1990, due to lack of work. Wall stopped paying in February 1992, intending to cut all ties with the union.
But when questions arose about the effect of the settlement on their pension credits, the two men sought to rejoin the union.
In April 1992, the union rebuffed Cooksey's attempt, saying there were no jobs available and it was union policy not to accept members absent work opportunities.
The union told Wall in August 1993 that he was not eligible for readmission because he had not paid dues for more than one year and that he could not join as a new member until there were work opportunities or he found a job as a laborer. Both men sought work through the hiring hall.
Local 230 is affiliated with the Laborers' International Union of North America, which entered into an internal reform agreement with the Justice Department in February 1995 to address corruption and the influence of organized crime.
Wall and Cooksey sought readmission through procedures established in the DOJ agreement and again were rebuffed for lack of work opportunities.
In December 1995, the union barred the two men from using the hiring hall but, after complaining to the LIUNA general counsel they were again allowed to sign the job referral list.
In January 1996, a union official wrote Wall that he was barred under the LIUNA ethics code from rejoining the union and that the official would refer the matter to the union's inspector general, set up under the DOJ agreement.
A union attorney agreed that Wall and Cooksey were both barred from membership. However, the LIUNA general executive board attorney, who functions as an internal prosecutor, took the position that no one could be barred without following the union's ethics and disciplinary procedure.
Wall received a job referral in July 1996 and asked to rejoin the union, but the union still denied him membership.
When the executive board attorney directed the local to readmit Wall and Cooksey, the LIUNA general counsel asserted that the two men could not rejoin the union because the union constitution only allowed readmission within 12 months of allowing membership to lapse.
The executive board attorney agreed.
Wall and Cooksey filed suit in May 1997. The district court dismissed the complaint in May 1999, ruling that the LMRDA claims were time-barred and that the state law claims were preempted by the LMRA.
LMRDA Prohibits Retaliation.
The LMRDA guarantees members the right to express any views regarding union policies and protects them from discipline for exercising their rights, Winter explained. The parties did not contest that the applicable time limit for filing LMRDA claims is the state limitations period for personal injuries actions -- three years in Connecticut.
Local 230 argued that under the LIUNA uniform local constitution, former members who have not paid dues for more than a year are not entitled to readmission.
But Winter found Article III of the LIUNA constitution provides that all persons who lawfully acquire membership are entitled to readmission if they are working as a laborer within the local's territory and pay the applicable dues and fees.
Article VIII of the constitution governs the amount of dues and fees to be paid for readmission.
Local 230 argued that Article VIII implicitly bars readmission of those who have not paid dues for more than 12 months.
"Arguably, a more plausible meaning is that former members have priority to membership over new applicants but are otherwise treated like new members," Winter said. Rejecting the union's contention that it was entitled to rely on its long-standing interpretation, he found the union "has hardly been consistent in asserting the 12-month rule even with regard to" Wall and Cooksey.
The two men also submitted affidavits showing that other members who had not paid for more than a year had no trouble getting readmitted.
Union Equitably Estopped.
A defendant can be equitably estopped from asserting that the statute of limitations has expired if the defendant's conduct caused the plaintiff to delay bringing the suit, Winter explained.
He said the plaintiff must show that the defendant made a definite misrepresentation of fact the plaintiff was likely to rely on and the plaintiff actually did rely on the misrepresentation and was harmed as a result.
"Arguably, the first act of the Union indicating an unequivocal decision to deny readmission to [Wall and Cooksey] occurred only in December 1995 when appellants were prevented from signing the referral list ... followed the next month by the Union's claim that they were 'barred persons' under the LIUNA Ethics Code," Winter said.
He found it unnecessary to determine exactly when Wall and Cooksey knew they had an LMRDA claim because he decided the two men were entitled to equitable estoppel.
The union clearly stated, as early as 1992, that Wall and Cooksey could become union members if they found a laborer job on their own or through the hiring hall, Winter said.
He found that both men then attempted to get job referrals, the union tried to prevent them from using the hiring hall, and the union denied Wall membership even after he got a job referral.
"There is more than sufficient undisputed evidence in this record ... to demonstrate that the Union intended to prevent [Wall and Cooksey] from ever being readmitted to membership and sought to conceal that intent by equivocal, temporizing, and misleading denials based on the lack of [job] referral," Winter said.
He found that the two men acted reasonably by seeking job referrals instead of suing.
Wall and Cooksey also acted reasonably in pursuing internal union remedies under LIUNA's agreement with DOJ, Winter decided.
He found that the limitations period was tolled under the LMRDA once the two men sought internal remedies.
Rejecting the district court's view that the LMRDA only allows a maximum of four months of tolling, Winter agreed with decisions by the Sixth and Seventh Circuits that additional tolling is appropriate if the plaintiff makes bona fide efforts to exhaust internal union remedies. He found that the limitations period was tolled from late 1995 or early 1996, when the union said the two men could not use the hiring hall and were barred under the ethics rules.