ABF FREIGHT SYSTEM, INC. v. NATIONAL LABOR RELATIONS BOARD
After employee Michael Manson gave a false excuse for being late to work, ABF Freight System, Inc. (ABF) fired him for tardiness. Manson repeated his false excuse while under oath at a hearing before an Administrative Law Judge, during which he argued that ABF had fired him in retaliation for his previous union activities. The National Labor Relations Board reversed the judge, ruling that ABF had used Manson's tardiness as a pretext to fire him. The Board reinstated him with backpay.
ABF appealed to the U.S. Court of Appeals for the Tenth Circuit, claiming that the Board could not reinstate an employee who lied under oath. The Tenth Circuit ruled that the Board could determine whether or not to pardon Manson for giving a false excuse.
Can the National Labor Relations Board grant reinstatement with backpay to an employee who lied under oath during his administrative hearing?
Yes. Justice John Paul Stevens, writing for a unanimous Court, reasoned that the National Labor Relations Act gave the Board broad authority to adopt laws regarding the reinstatement of employees. The Court called perjury "intolerable in a formal proceeding," but ruled that the National Labor Relations Board was under no obligation to adopt a blanket rule against reinstating employees who have perjured themselves. Reducing the Board's discretion in making rules for employee reinstatement "might force the Board to divert its attention from its primary mission and devote unnecessary time and energy to resolving collateral disputes about credibility."
Argument of John V. Jansonius
Chief Justice Rehnquist: We'll hear argument next in Number 92-1550, ABF Freight System v. National Labor Relations Board.
Mr. Jansonius: Mr. Chief Justice and may it please the Court:
Remedies in unfair labor practices are public remedies.
The issue in this case is whether an individual who testifies in an unfair labor practice case under oath, and who testifies untruthfully, may share in the remedy that may be entered at the conclusion of that proceeding.
This case was filed as a consolidated case involving several dockworkers who worked for ABF Freight system in Albuquerque.
Ironically, the only one of those dockworkers to prevail in this case is Mr. Michael Manso.
Mr. Manso was discharged on August 17, 1989, ostensibly for being late for work that day.
At the hearing in Albuquerque, he testified as to the reason he was late for work.
He said that his car had broken down on the way in, that he'd had to call his wife and that she came and picked him up and then took him on to work, at which time he was pulled over by a highway patrolman.
The judge heard all that testimony, and the judge concluded that Mr. Manso was lying in testifying as to his reason for being late for work that day.
In an adversary system for resolving disputes, we believe that the oath that a witness takes is absolutely vital, that it's fundamental to the process.
The first step to correctly applying the law is to decide the facts correctly in the first place, and a witness who does not honor the oath makes that process much more difficult for the courts and in this case for the administrative law judge.
Perhaps more than in any other context in the Federal system a correct outcome on the facts in unfair labor practice cases is dependent on witnesses honoring their oaths.
Whether or not a complaint is even to be filed in the first instance is normally decided by counsel for the general counsel or by the regional offices of the NLRB simply based on affidavits.
Individuals who give statements to the NLRB's are under oath, and their statements are taken at face value for the most part, and whether or not there is even going to be a case depends on whether that individual is giving a true affidavit.
Unknown Speaker: Do Federal courts deny people relief because of perjured testimony?
Mr. Jansonius: They have that discretion, Your Honor.
They don't necessarily do it.
I'm not aware of any cases where an individual who has been found to have testified untruthfully to a Federal district judge has been awarded relief.
Unknown Speaker: They have that discretion?
Can I, as a judge, even though the plaintiff is entitled to judgment in the case, say,
"You're entitled to judgment but I'm not going to give it to you because you perjured yourself here. "
Can a Federal judge do that?
Mr. Jansonius: In a particular context a Federal judge might be able to do that.
I'm not aware of any situation--
Unknown Speaker: You think he might be.
Mr. Jansonius: --Might be.
Unknown Speaker: But he might not be, too.
Mr. Jansonius: Might not be, Your Honor.
Unknown Speaker: So you don't know, in other words.
Mr. Jansonius: That's correct, Your Honor.
Unknown Speaker: All right.
Mr. Jansonius: I do know the unfair labor practice, though, followed by the NLRB, and I think that in the context of unfair labor practice proceedings it's particularly important that the oath be honored.
Unknown Speaker: What if a representative of management of the employer lies under oath at the NLRB proceeding?
What's the rule?
Mr. Jansonius: Well, the--
Unknown Speaker: Even if it turns out that, notwithstanding what clearly was a lie on some point, that the employer is entitled to judgment?
Mr. Jansonius: --If I'm following, you're saying what is the situation if the representative of management testifies--
Unknown Speaker: Yes.
Mr. Jansonius: --untruthfully--
Unknown Speaker: Yes.
Mr. Jansonius: --and the company nonetheless prevails in the case?
Unknown Speaker: Well, under the law and the facts, the company should prevail.
What must be done there?
Must relief be denied under your rule, a per se rule?
Mr. Jansonius: I think there are two possibilities.
Number 1, if there has been no unfair labor practice, I'm not certain that the NLRB has jurisdiction to do anything about it.
I do think that, assuming that they do have jurisdiction, that they have remedial power that they could craft a remedy in that situation, that they could deal with it.
They, for instance, could make the employer post a notice explaining to employees what they did in the unfair labor practice proceeding.
They could be perhaps required to give a union representative equal time to come into the plant, tell the employees, we had an unfair labor practice case, we lost in that unfair labor practice case, here's why, but you must know that the employer did so-and-so.
There are a variety of remedies that I think the NLRB would have in that situation, assuming it has jurisdiction.
Unknown Speaker: But you wouldn't suggest a per se rule there?
Mr. Jansonius: Well, I might, Your Honor, presented with the situation.
I'm not aware of that situation coming before us.
Unknown Speaker: Let me ask you this: did this employer introduce evidence that under every circumstance, if they had an employer they discovered who had lied, the employer would be discharged, that that was the rule of the employer.
Mr. Jansonius: That specific evidence was not presented, but the evidence was presented in the sense that it's in our collective bargaining agreement that dishonesty is grounds for immediate termination, so certainly the collective bargaining representatives, or the union representatives and the management representatives who negotiated the contract felt that dishonesty was a serious offense.
Unknown Speaker: But as we take this case, the employee was not discharged for dishonesty but for other things.
Mr. Jansonius: That's true.
Unknown Speaker: I mean, that's how it comes to us, anyway.
Mr. Jansonius: That's true, and the... I will tell you that the evidence on that point was somewhat equivocal, and that may be--
Unknown Speaker: Yes, but I mean, we take it on that basis, I guess.
Mr. Jansonius: --Yes, you do.
Unknown Speaker: Are you prevented from discharging the employee now because of the dishonesty that you learned he has engaged in, that you now know he has engaged in?
Mr. Jansonius: --I think we could, Your Honor.
I'm not sure how the collective bargaining agreement applies in that situation, whether that would be a contractual issue between ABF and its union representatives.
Unknown Speaker: Don't you think the Board would have some problem with that?
Mr. Jansonius: I'm sure they would have some problem with it, but I think we would be legally justified in terminating him.
The contractual issue is one I'm not familiar with on the procedures under the National Master.
Unknown Speaker: Why isn't this case a standoff on lying?
The ALJ found that a couple of the employer's witnesses also lied.
Mr. Jansonius: Your Honor, I don't think he made that finding.
He did discredit some of the employer's witnesses on some comments that supposedly were made when Mr. Manso returned to work on one occasion.
He used much stronger language in characterizing Mr. Manso's testimony, and I think there was a reason for that.
It was very clear that Mr. Manso was not just mistaken on the facts or had a faulty memory.
He was contriving a story that was not true.
I don't think--
Unknown Speaker: Well, how does that differ... there were three officers who, according to Manso, said, watch out, the boss is gunning for you, and they said, we never said any such thing.
Now, if they said that, why aren't they out-and-out lying?
Mr. Jansonius: --Well, there could be a number of explanations for it.
They could simply have forgotten.
It could be a statement that was blown out of context.
It might be something that their memory of the event differs from Mr. Manso's memory of the event.
I don't think that you can say necessarily that because a witness' testimony is not credited that they're being deliberately untruthful.
Unknown Speaker: Mr.--
--The ALJ says,
"I believe Manso. "
"He said he was told the boss is gunning for you. "
These witnesses have taken an oath that that never happened.
Why aren't they lying?
Mr. Jansonius: Well, I don't think you can make that assumption that they're lying, because the events that had occurred were months in advance of that.
Unknown Speaker: When the ALJ says, "I credit Manso", isn't he necessarily saying, I discredit these others?
Mr. Jansonius: He is saying that.
He's saying that.
I don't think he's saying that they have come into the courtroom and deliberately given false testimony.
Unknown Speaker: Mr. Jansonius, you're willing to settle for a standoff, aren't you?
Aren't you willing to say, okay, we both lied, and neither one of us should get any relief?
Isn't the difference that the other liar is getting relief?
Your client's not getting any relief from the court--
Mr. Jansonius: Well--
Unknown Speaker: --so even if they are both lying, all you're asking is that both liars be treated equally.
Neither one of them gets any relief.
Mr. Jansonius: --Well, that's true--
Unknown Speaker: That's fair, isn't it?
Mr. Jansonius: --I would be satisfied with that.
I don't like the equation, though, that our witnesses lied, and I don't think you can say--
Unknown Speaker: Well, but there's a difference--
Mr. Jansonius: --that they were speaking for the corporation.
Unknown Speaker: --in giving relief to the side that's lying, and in giving relief to nobody at all.
Mr. Jansonius: I agree with that, and the fact is that we are not contesting the total award entered by the NLRB.
Unknown Speaker: --But your position as a matter of law, as I understand it, is that even if an employee's of... even if a management representative testifies blatantly falsely, and in all other respects the charge should fail against the employer, you wouldn't say well, you go ahead and grant relief against that company because they're guilty of blatant falsehoods, would you?
Mr. Jansonius: I'm not sure I'm following your question, Your Honor, but I don't think--
Unknown Speaker: The question is whether the rule you're asking for is evenhanded.
In other words, just assume the same kind of perjury on the other side of the fence that occurred here.
Would that automatically decide who wins the proceeding?
Mr. Jansonius: --Well, it's not a liability issue.
We have lost the case, technically.
We're not contesting--
Unknown Speaker: Just on the remedy.
Mr. Jansonius: --Just on the remedy.
We are not contesting at this stage, any more, the finding of an unfair labor practice being committed.
I would like to point out, though, that--
Unknown Speaker: Mr.... you wouldn't be evenhanded?
You would not argue for the same rule if the employer was seeking relief from the Board and the employer lied?
You'd say, if employers lie they can get relief, but if employees lie, they cannot get relief?
Mr. Jansonius: --Oh, no, I'm not saying that at all.
Unknown Speaker: So you would treat the employer evenhandedly?
Mr. Jansonius: Yes.
Unknown Speaker: If he were seeking relief from the Board and it was shown that the employer perjured himself, you wouldn't give the employer relief, either, or at least not the kind of relief that's equivalent to the backpay and rehiring here.
Mr. Jansonius: No, I wouldn't.
I think that sometimes employers are charging parties in unfair labor practice cases.
It's not very often, but they sometimes are, and if they do go in and abuse the process, I don't think they should be given relief.
You have a little tougher issue with employers, though, and it's because sometimes the... it's not the officers, directors, or the shareholders of the corporation who are acting, but individuals who are testifying on behalf of the company.
You just do not--
Unknown Speaker: Well, doesn't that point out one likely difficulty if we were to adopt your rule, Mr. Jansonius?
It would complicate the procedures before the ALJ and the Board, because you'd have a lot of what you might call satellite litigation, or at least satellite determinations.
You know, much concentration on was this particular witness lying, or was he merely mistaken, or something like that?
Mr. Jansonius: --I don't think you would, You Honor.
We're not asking the administrative law judges to change the way they go about deciding cases.
They... they are normally very judicious.
They normally refrain from making those strong determinations.
Unknown Speaker: Well, what's wrong with saying this answer on the part of the employee, that that... even if it's a bad answer, it's good enough for a bad charge, because if the lateness is a phony excuse, if the employer wants to get rid of this employee because he's been prounion, and then the employer makes up as the reason the lateness, why shouldn't the employee... I'm going to try to save my neck for this bad charge.
I'm going to give an answer that will help me stay.
Why should... why shouldn't... the Board's position is, we have to be sensitive and situation-specific in our analysis of this.
Why should you come and say,
"Board, you must defend your honor and anytime anybody lies to you, no relief. "
Mr. Jansonius: Well, the employee has a choice to make.
They can go in and tell the truth, or they can go in and tell a lie.
Unknown Speaker: No, but it's a question of, are... the authority we can exercise over the Board.
Even assuming, for the moment, that the rule you suggest has some merit to it, don't you have to tell us that the Board is arbitrary in not adopting that rule?
Mr. Jansonius: --I don't think we have to prove arbitrariness, although I think it exists here.
Unknown Speaker: Well, how else can we reverse the Board's determination?
Mr. Jansonius: Well, under the statute, I guess the issue is whether awarding relief, reinstatement and backpay to somebody who has deliberately given false testimony will effectuate the purposes of the act.
Unknown Speaker: Well, isn't the legal proposition that you're putting forth that the National Labor Relations Board is arbitrary if it fails to adopt a rule that refuses relief to any employee who lies... lies, I suppose, on a material matter?
Mr. Jansonius: Yes.
I believe that it is an arbitrary position, if not just an erroneous as a matter of law position, for the NLRB to state that someone who abuses the process by coming in and giving false testimony is entitled to backpay and reinstatement, and that doing that will effectuate the purposes of the act.
I don't see how the Board can make that case that putting somebody back to work, giving them backpay in this situation, is going to effectuate the purposes of the act, and I think that is why the Congress assigned this Court with supervisory responsibility over the Board.
There have been many instances over the years where this Court looked at NLRB remedies and made the conclusion that what the NLRB did perhaps ran afoul or interfered with other Federal policies and corrected the Board on the remedy that it entered, and this is one of those situations where I believe that is appropriate.
I think it's particularly appropriate in the NLRB context, just because of the nature of the proceedings themselves.
We have very few safeguards for truth in unfair labor practice proceedings.
The oath is perhaps one of them.
The Board serves as prosecutor, they serve as judge, they serve as jury, they hear the first level of appeal, there's no discovery, there's no way for an employer like ABF to know in advance of a hearing what the Government's evidence is going to be, who the witnesses are going to be, what they're going to say.
You can't even get statements from individuals who have given affidavits to the National Labor Relations Board until they actually take the stand at the hearing, and even then only after they've testified.
Unknown Speaker: Mr. Jansonius, this would be a rather sweeping proposition if the Court were to accept it.
How many other agencies are there like the NLRB who deal with the truthfulness of what witnesses say?
Are you suggesting that every Federal agency must take the position that one who doesn't tell the whole truth and nothing but the truth doesn't get individual relief?
Mr. Jansonius: Your Honor, I can't answer the first part of your question, how many other agencies there are.
I'm very familiar with the National Labor Relations Board, and in proceedings like this, if there are other agencies that have a similar adjudicatory process, I think the rules should apply to them.
There are very few safeguards for truth in unfair labor practice proceedings, and the oath in this context is particularly important.
An employer, or a union--
Unknown Speaker: But you're not familiar with any such rule that a trial... say trial judge is having a bench trial and doesn't believe some of the things the plaintiff says, that that judge must then deny relief to the plaintiff?
Mr. Jansonius: --No.
In the civil litigation system I'm not aware of any rule with that effect.
I do think it's the practical reality of litigation in the Federal district courts that individuals whose testimony is discredited on material points don't prevail.
Unknown Speaker: What about courts of equity, Mr. Jansonius?
Do you think a court of equity which has various forms of relief available couldn't say, we're going to give one form of relief rather than another because you affronted the court by perjuring yourself?
Mr. Jansonius: Yes, I think--
Unknown Speaker: Do you think a court of equity would do that?
Mr. Jansonius: --I think a court of equity would be in a position to craft a remedy that's appropriate in this case.
I think the Board--
Unknown Speaker: How many other Federal agencies are there besides the Labor Board that have such a variety of remedies, varieties of forms of relief that they can give in a particular proceeding?
I mean, it's not like the usual litigation where you find for the plaintiff and give him his damages or you don't.
The Board has a lot of varieties of relief it can give.
Are there are a lot of other Federal agencies that are in that situation?
Mr. Jansonius: --Your Honor, I wish I could answer that.
I just don't know.
I do know that the NLRB has very broad discretion and it can craft remedies.
Unknown Speaker: And I thought that your point was that the Board used to do it the way that you now suggest, and it didn't seem to slow down the proceedings very much.
Mr. Jansonius: No, I don't think it slowed down proceedings at all, and I do think at one point in time the Board had pretty much the attitude that I'm advocating they should take now, that one who has given false testimony is not going to be given a share of the public remedy.
Unknown Speaker: And it's also saying that that is a matter of law... maybe if the Board decided how it wanted to proceed, that would be one thing, but you say... what compels the Board to take that view?
Mr. Jansonius: Your Honor, what compels the Board to take that view is I believe, number 1, starting with section 1 of the act which sets out the purposes, I don't see that reinstating someone with backpay and giving them money damages or reinstatement is going to effectuate any of the purposes set out in section 1 of the act.
I believe section 10(c) of the act makes some remedies nondiscretionary with the Board and makes it clear that they have to enter some forms of--
Unknown Speaker: You're taking us out of the equity mold into the strict law mold.
Mr. Jansonius: --Yes.
I think what really separates this case from the standard unfair labor practice case where the discretion has been accorded the Board to mold the remedies under section 10(c) with very little review is the fact that we do have other policies that come into play here.
Typically, the NLRB is deciding strictly labor disputes that don't have ramifications that go outside the National Labor Relations Act where the Federal policies are impacted.
This one does, and that's why I think it's appropriate for the Court here to take a hand in directing the Board and supervising it, and what remedies are to be entered in this rather narrow context.
But there's no provision in the statute that directly addresses it, and I can't imagine that Congress really thought of this situation... what's going to happen with a charging party who comes in and lies, and what should the Board do then?
Congress was concerned when it considered the National Labor Relations Act about the lack of safeguards for truth.
When the bill was originally considered in the Senate, it specifically provided that the rules of evidence were not to apply.
That was the subject of some debate in Congress, and there was a lot of testimony that this was... before the Congress at the time that this was not a good policy, that the rules of evidence should be applied.
And after debating the issue, Congress did a turnaround and made section 10... put in section 10(b) that the Federal Rules of Evidence were to be applied insofar as practicable in unfair labor practice proceedings, and I think that indicated that Congress had some concern with the lack of safeguards for truth in the unfair labor practice context, and did what they could to see that the oath was made a part of the process.
Your Honors, through its brief, the Solicitor General has argued that the NLRB, that its order in this case does effectuate the purposes of the act.
ABF would submit to this Court that the Government's attorneys are putting words in the mouth of the NLRB.
There is no finding in the NLRB's decision and order that reinstating Mr. Manso with backpay will effectuate the purposes of the act, and there certainly is no explanation in the Board's decision and order about how reinstating a witness who has given false testimony is going to effectuate the purposes of the act.
Unknown Speaker: But there was deference to the Board's judgment--
Mr. Jansonius: I--
Unknown Speaker: --expert judgment in handling these labor problems.
Mr. Jansonius: --Generally there is deference to the Board's expertise in handling labor disputes and taking actions that will prevent labor strife.
I don't think this is a context where the Board has shown that it has an expertise in the subject matter at issue, and I don't think that the Board's decision and order gives any explanation for the Court that would enable you to say that they were acting properly to effectuate the purposes of the act.
There simply isn't any discussion in the decision and order about how giving a remedy to somebody who has given false testimony is going to effectuate the purposes of the act.
ABF would urge the Court that, as a strict proposition, that reinstating someone, giving someone backpay in this context will not effectuate the purposes of the act.
There's a few points I'd like to make in that regard.
First, as I said in my opening comment, getting at the true facts of the case is the first step to correctly applying the law.
If a witness is not going to honor the oath, that's going to interfere with the NLRB's and any other agency's ability to get at the true facts and to correctly apply the law, so just from a very broad proposition, a witness who is not telling the truth is undermining an agency's ability to enforce and protect the purposes of the statute.
There are other reasons as well why I believe that the Board's order in this case cannot possibly effectuate the purposes of the act.
First of all, I think it's just common sense that putting someone like Mr. Manso back to work is going to be saddling ABF with a contractual relationship with someone who it has very good grounds not to trust, and there's certainly going to be a loss of respect between the employer and employee, and I don't think that a working relationship with someone who has taken advantage of the system and the employer the way Mr. Manso has could be said to do anything to reduce labor strife or to promote the free flow of commerce.
I think that the act, the purposes of the act are frustrated in this context by encouraging false claims.
The NLRB is going to look like a very friendly forum to charging parties... and it should be a receptive forum, I'm not saying that, otherwise... but it's going to look like a system where the Government can be taken advantage of, and I don't think that effectuates the purposes of the act.
I think the remedy that the Board has ordered in this case undermines ABF's collectively bargained agreements procedure.
Mr. Manso went through the agreements procedure.
A three... or six-member panel equally composed of labor and management concluded that he should not be put back to work, concluded that he was not entitled to backpay.
Given what's happened, I think that the Grievance Committee that ABF has negotiated with the local union of the Teamsters is going to look like a less receptive forum, and there's going to be more tendency to try and sidestep the grievance procedure knowing that the NLRB is going to be more forgiving of those who try to take advantage of the system.
For all those reasons, I think that the Board's order in this case, or in any similar context, is not effectuating the purposes of the act, and again I would say that I think that the NLRB needs to be reminded that it does not apply the act in a vacuum.
This Court has said several times that other considerations have to be taken into account when crafting unfair labor practice remedies.
It did so in Sure-Tan, it did so in Detroit Edison, it did so in Lechmere, it's done so in other cases.
And the NLRB in this case did apply the act in a vacuum, it did take a very narrow reading of public policy, and looked strictly at the National Labor Relations Act instead of taking other concerns into account which we believe that they are compelled to do, and we believe that this Court as the supervisor over the NLRB should make it clear to them that they've got to take the oath seriously, that it is a public policy that it be honored, and that should be made a stronger part of the National Labor Relations Act.
Unless there are other questions I'll reserve my time.
Unknown Speaker: Very well, Mr. Jansonius.
Mr. Wallace, we'll hear from you.
Argument of Lawrence G. Wallace
Mr. Wallace: Thank you, Mr. Chief Justice, and may it please the Court:
Under the limited grant of certiorari in this case, the question presented is a legal question about the Board's remedial authority, and as petitioner recognizes, that remedial authority is a creature of statute.
It's set forth in section 10(c) of the National Labor Relations Act, which is reproduced in full in the appendix to the certiorari petition, the white-covered certiorari petition, at page C-5 toward the very end of the appendix to the petition.
It's a rather lengthy provision, but there are two discrete portions of it that have relevance here.
The first is at about ten lines down in the middle of the sentence, beginning close to the beginning of the line,
"After the Board has found that there's an unfair labor practice it ordinarily issues a cease and desist order, and it's authorized then, and to take such affirmative action, including reinstatement of employees with or without backpay, as.... "
Unknown Speaker: Where are you reading, please?
Mr. Wallace: I am about ten lines down on page C-5.
Unknown Speaker: Thank you.
Mr. Wallace: About ten lines down within subsection (c):
"The Board is authorized to take such affirmative action, including reinstatement of employees with or without backpay, as will effectuate the policies of this act. "
And then about twelve lines from the bottom of this provision there is a sentence that begins, just past the middle of the line, that says,
"No order of the Board shall require the reinstatement of any individual as an employee who has been suspended or discharged or the payment to him of any backpay if such individual was suspended or discharged for cause. "
Except for that provision, one searches in vain for an express limitation in the statute on the Board's remedial authority in ordering reinstatement or backpay in accordance with the Board's judgment of what will effectuate the policies of the act, and in this case there was a determination made by the Board... on page B-21 of the appendix to the petition... that this was not a discharge for cause, that the cause given was a pretext for discrimination.
That finding was upheld by the court of appeals... on pages A-14 to A-18 of the appendix to the petition... and that question is not at issue here under the Court's limited grant of jurisdiction.
So the only express limitation in the statute that the courts obviously would have to consider enforcing against the Board in limiting its remedial authority is not applicable here, and the question becomes, as Justice Kennedy very aptly phrased it in his question, whether the Board was arbitrary in... has been arbitrary in the standards it has adopted in determining when reinstatement and backpay will effectuate the policies of the act.
Unknown Speaker: Or an abuse of discretion... arbitrary, capricious, an abuse of discretion or otherwise not in accordance with law, as the APA says, and the contention here is that it's an abuse of discretion, I gather, substantially.
Mr. Wallace: Well, the Court has formulated it in numerous ways, many of which we collected in our brief.
The first decision of this Court dealing specifically with the question of reinstatement was the 1941 decision, written by Justice Frankfurter for the Court in the Phelps Dodge case, and we have set out a relevant quotation from that on the very last page of our brief, in which the Court upheld in that case the Board's authority to order reinstatement as a remedy for employees who had found other employment and were not entitled to backpay.
The Court emphasized that because the relation of remedy to policy, which is the statutory criterion, is peculiarly a matter for administrative competence, courts must not enter the allowable area of the Board's discretion and must guard against the danger of sliding unconsciously from the narrow confines of law into the more spacious domain of policy.
Unknown Speaker: Mr. Wallace, is there any doubt that the lie told here in this legal proceeding, of which this is the last stage, the court of appeals being the intermediate stage... is there any doubt that it was perjury, a felony under Federal law?
There's no real doubt about that, that it was material to the proceeding.
Mr. Wallace: Well, it was found to be purposeful--
Unknown Speaker: And material to the proceeding.
Mr. Wallace: --by the administrative law judge, and the Board expressed no disagreement with that.
Unknown Speaker: Well, I find it... to my mind it is.
I just don't think there's much of a doubt about it, and with that in mind, I am just astounded... I never thought I would read a Justice Department brief in those circumstances which says a lie, uttered by an employee trapped in these somewhat unusual circumstances may be reasonably be characterized as less deserving of sanction than a lie given by an employee who has not endured a similar history of mistreatment by the employer, and the employee's adherence to his story before the ALJ... the felony... though unjustifiable... felonies are unjustifiable... is understandable.
Will this be posted, require to be posted in the employee's place of employment when this... when this perjurer is compelled to be rehired so that everyone who goes to NLRB proceedings will understand how understanding the Board and the Justice Department is of perjury in NLRB proceedings?
Mr. Wallace: Well, Mr. Justice, we certainly would not disclaim the authority to prosecute for perjury in this case or any other, and we have collected cases in our brief in which the Board has referred matters to the Justice Department for prosecution... this is on page... footnote 19 on page 27 of our brief... when there has been perjury in proceedings before the Board, and as there are remedies for perjury which do not require distortion of the Board's remedial authority in deciding what the appropriate remedy is for a proven unfair labor practice.
Unknown Speaker: The Justice Department also says in its brief that
"the Board, however, has discretion in determining how best to protect its integrity while effectuating the policies of the act. "
What about the courts' integrity, who ultimately permit the enforcement of these orders?
Do you think it's no imposition upon the integrity of the courts who must accept the factfinding proceedings held by the NLRB?
Mr. Wallace: Well, something of that flavor comes through in the Precision Window opinion, which said that the Board is not entitled... the Board is barred from awarding reinstatement or backpay to... in favor of a charging party who has lied in the proceedings before the Board.
I would mention, however, that the court did not take the position that it was barred from upholding the Board's entry of a cease and desist order.
The question ultimately has to be whether the Board acted beyond its authority.
That is all the court is being asked to determine when the question before the reviewing court is whether to enforce the Board's order.
Unknown Speaker: Or whether it was an abuse of discretion in granting this remedy--
Mr. Wallace: This particular rem--
Unknown Speaker: --in light of the other remedies that were available.
Mr. Wallace: --Whether the remedy should have been a more limited one.
Unknown Speaker: To this particular individual who had perjured himself in the course of the court's proceeding.
Mr. Wallace: Well, as the Board recognized in the same Phelps Dodge case back in 1941 with respect to reinstatement, and as this Court has emphasized in that case and in the Golden State case much more recently, there is a public dimension to this relief.
This is not relief just for an individual.
The reinstatement remedy in particular, as the Board emphasized in Phelps Dodge, is one that reassures other present and future employees of the same employer that discrimination based on antiunion animus or protected conduct under the act will be remedied.
Unknown Speaker: There is also a public dimension, is there not, Mr. Wallace, to being understanding of perjury in the course of NLRB proceedings.
Does that have no public dimension, either?
Mr. Wallace: There are many credibility determinations to be made in Labor Board proceedings.
It is not always clear, as this Court's opinion last term in St. Mary's Honor Center very eloquently and emphatically pointed out, that every determination that the credibility of one witness rather than another is to be upheld means that the witness whose credibility is not being honored has... is a liar or a perjurer, has deliberately told a lie rather than misrecollected something or was confused about something.
Unknown Speaker: But in this case, isn't it true that the ALJ stated that the person lied?
Mr. Wallace: In this case it happened to be an easy determination because this particular story had earlier been told to the employer and the employer had investigated it and disproved it.
It happened to be something that could easily be determined in this particular case.
But my point is a point that you yourself made in a question earlier, Mr. Chief Justice, that if it becomes a legally dispositive question whether a rejection of a witness' testimony is based on a determination that that witness was deliberately lying, then the other party in the case can ask the Board to make that determination--
Unknown Speaker: Why?
Mr. Wallace: --in every case.
Unknown Speaker: Why so?
Why couldn't we just say that when the Board does make that determination, when the Board says for all the world to see, this plaintiff is a perjurer, the Board shall not then go on to say, and we're going to require the company to give him his job back... without requiring the Board to make that determination, but if it makes the determination and announces publicly that the person seeking relief is a perjurer, why is it unreasonable to say, it's an abuse of discretion, to then go on and say, and we're going to give him relief?
Mr. Wallace: Well, since there was no... it has a gratuity in the determination of the case to have made that pronouncement, or if it's a legally important determination, others could ask that it be determined in other cases.
Unknown Speaker: I don't think so, but it's a question of whether it fulfills the purposes of the act.
Once that announcement has been made on the record, whether it fulfills the purpose of the act then to reinstate the person in his employment, who then can strut around and say, yes, I lied in my proceeding... didn't hurt me a bit.
I got reinstated.
I got my money back.
Does that fulfil the purpose of the act?
Mr. Wallace: Well, the Board is quite conscious of the need to protect the integrity of its processes, and as the Lear-Siegler case which we discussed at some length, demonstrates, it has on occasion, using its standards, tolled backpay when there has been misconduct in the Board proceeding.
Unknown Speaker: In this case, Mr. Wallace, the Board didn't make any finding that this particular individual had lied, as I recall.
As you point out, the administrative law judge made it--
Mr. Wallace: Precisely so.
Unknown Speaker: --and the Board simply didn't deal with the question.
Mr. Wallace: Precisely so, because the Board did not consider it determinative of what the appropriate remedy should be.
Unknown Speaker: Well, in Lear-Siegler the Board was upset that an employee that... had manipulated a witness, and the Board was very protective of its own turf, saying that you've interfered with our processes, but in Owens Illinois the Board awarded reinstatement to a line employee because the employer had not demonstrated that the employee was unfit, so it seems to me that you give very little consideration to the injury that the employer faces when the employer has to mount the burden of proving perjury, which the employer in this case did.
Mr. Wallace: The Board does make a distinction between backpay and reinstatement.
It will toll backpay it there has been misconduct or misuse of its proceedings as a means of protecting the integrity of its proceedings, but it explained in Lear-Siegler that that is not in itself a sufficient reason to deny reinstatement of an employee as a remedy for an unfair labor practice because of the importance of reinstatement to protecting the rights of coworkers.
What they are aware of is not what happened at the Board proceeding.
What they are aware of is that somebody was discharged for exercising his rights under the act, but the Board says in Lear-Siegler that reinstatement will be denied if the misconduct renders the employee unfit for further employment.
Unknown Speaker: Well, what if the employer's rule is that any employee who commits a felony is not eligible for continued employment with us, and perjury is a felony.
That's our rule.
Now, does the Board take that into account?
Mr. Wallace: That would be part of what the employer could show in showing that the particular employee was unfit.
I do want to caution that there has been no conviction of a felony in this case.
What the administrative law judge found would, if proven in a perjury prosecution--
Unknown Speaker: No, my question didn't--
Mr. Wallace: --in accordance with the proper procedural--
Unknown Speaker: --didn't refer to convictions.
It said felons, people who commit felonies will no longer be employees of ours, and here we have a finding of perjury, in effect.
Mr. Wallace: --Under the Board's practice, that is... that would be relevant to a showing by the employer that the employee was unfit because of his misconduct in the Board proceedings for reinstatement.
No such showing was made in this case.
The grant of certiorari is limited to the question of whether the Board is automatically disabled from ordering backpay and reinstatement, its normal remedies for an unlawful termination--
Unknown Speaker: If an employee--
Mr. Wallace: --if an employee lied purposefully.
Unknown Speaker: --If there were an applicant for employment with the Department of Justice and it was known that he committed the felony of perjury, would you say, oh, well, we have to counsel that there's been no conviction here, if all conceded that there had been a felony committed?
Mr. Wallace: Well, we certainly would take it seriously in the Department of Justice.
Unknown Speaker: Isn't the employer entitled to take it just as seriously in his workplace?
Mr. Wallace: The Board's rule is that lying or committing a felony can be just cause for discharge.
That was not the cause for discharge in this case, and if Manso or anyone else were to engage in that kind of misconduct on the job in the future and the employer wanted to terminate him for that reason, the employer could do so, and it would be a termination for cause.
All the act prohibits is discrimination for exercising the rights protected by the act, which is what was found to have been done here, and the remedial question is all in a context of what has been proven in proper proceedings, which is not a felony but an unfair labor practice by the employer, and whether the Board should apply its normal remedies for the unfair labor practice.
There were statements made by both sides in this proceeding that the Board determined to have been false.
The Board had no occasion to... even the ALJ had no occasion to decide whether the three supervisors testifying on behalf of the employee... of the employer had been purposefully lying, although the circumstances of rejecting the credibility of their testimony would suggest that it's quite probable that they were.
So it's quite probable that several felonies were committed by persons on both sides here.
It just happens that it was a little more obvious... there was something transparently foolish about the charging party's testimony here, because it had already been disproven on a prior occasion.
Unknown Speaker: The difference is that the Board is not giving any relief to the other liar.
I'm not asking that the Board go around punishing liars.
I'm just asking that it not give relief--
Mr. Wallace: Well, it's not giving relief, but they're--
Unknown Speaker: --to liars.
Is that too much to ask?
Mr. Wallace: --But if the normal backpay and reinstatement remedy is denied, then the employer is benefiting from the outcome of the proceeding in a way that other employers who engage in the same unlawful conduct would not benefit... a distinct monetary benefit in comparison with his competitor down the street, for example.
Unknown Speaker: Mr. Wallace, I don't... do you contend that the Board did not accept the district judge's finding that this story was a fabrication?
The Board's opinion refers to Manso's story... the respondent checked his story and ascertained it was largely a fabrication, and later in the Board's opinion it refers to "Manso's false explanation".
This is the same explanation he gave before the administrative law judge, isn't it?
Mr. Wallace: Well, it recited this and--
Unknown Speaker: And accepts it.
Mr. Wallace: --it took no exception to it.
It didn't treat--
Unknown Speaker: Is that referring to the sworn testimony, or the explanation to the employer, when he said he was late for work, and he gave a phony reason for being late for work?
Mr. Wallace: --He really just repeated the same story.
Unknown Speaker: It was one and the same.
Mr. Wallace: I think you're right, Justice Stevens, that as it was referred to in recounting the earlier facts, it was referring to the earlier version of the story.
The story was essentially the same in both places.
Unknown Speaker: Mr. Wallace, there's nothing in this record that tells us how the employer in this institution has treated people who don't tell the truth other... no routine practice.
It couldn't fire, but don't necess... we don't know whether they do or they don't, whether this is one of a kind, or--
Mr. Wallace: That is correct, Justice Ginsburg.
The employer would have had an opportunity in the Board proceedings, of which it did not avail itself, to show that under the Board's established approach, the Owens Illinois/Lear-Siegler approach, this employee was not entitled to the remedies because he was unfit under the employer's criteria, under criteria that would be applied not in a discriminatory fashion only against somebody who tried to exercise rights under the act, but to any employee.
Unknown Speaker: --Mr. Wallace, can I ask you, I take it you would agree that this is a Chevron-type case.
You rely on Chevron, to some extent, don't you?
Mr. Wallace: Yes, Mr. Justice--
Unknown Speaker: Would you agree that the discretion of the Board is broad enough so that you could adopt the rule of the other side advocates, that any employer... any employee who was found to have perjured himself in a board proceeding shall never get the remedy of reinstatement?
Mr. Wallace: --Well, I think so, and we think so--
Unknown Speaker: Do you think you could go further and say that any employee who lies about the reason he was late for work shall never be reinstated?
Mr. Wallace: --The Board would be acting beyond its authority if it were an arbitrary effort to effectuate the policies of the act, or if it were inconsistent with the way the Board normally handles these cases and the Board is not announcing a reasoned change in its approach to the cases as a general matter but is just arbitrarily singling someone out.
That was really what I was trying to get at at the outset by looking at the statute.
Except for the one prohibition in the statute on ordering backpay or reinstatement of an employee who has been discharged for cause, the question of prophylactic rules is a question left to the Board's discretion in effectuating the policies of the act under the general conferral of authority to--
Unknown Speaker: Well, given that discretion, is the answer to Justice Stevens' question that yes, the Board could go that far and adopt that strong a rule?
Mr. Wallace: --Well, it could, if its rationale were that the rule were needed to effectuate the policies of the act, which do require that the Board hearings be conducted with accurate testimony before it and that can rely on sworn statements and the rest of it, but the Board has taken a more balanced approach.
There are other purposes of the act to be effectuated as well, and the remedies that it has adopted, just as the remedies that it has adopted in cases of concealment of outside earnings, are balanced so that there is still a disincentive for the employer to engage in unfair labor practices along with a disincentive for the employee to conceal outside earnings, because the employee is denied part of the backpay but the employer still has to pay part of the backpay.
Unknown Speaker: Mr. Wallace, isn't a perjury indictment for everyone... I mean, it's such a massive sanction.
Nobody's going to prosecute Manso for this perjury, even though it's been found by the administrative law judge.
Mr. Wallace: Well it--
Unknown Speaker: --it's available, but it's just not usable, isn't that right?
Mr. Wallace: --Well, it was a transparent dog-ate-my-homework kind of lie.
It was rather tangential to the issues before--
Unknown Speaker: As it turned out.
Mr. Wallace: --As it turned out.
Unknown Speaker: It didn't seem so at the time.
It looked quite central when the lie was made.
Mr. Wallace: That's correct.
It's not the sort of case that the Board is likely to refer to the Department of Justice for a perjury prosecution, obviously.
It's not the kind of pervasive, deliberate lying that is more likely to give rise to that, and just as the Board has to deal with unfitness for further employment in... because of threats made to a supervisor, a threat to kill him, it's not easy always to sort out the hyperbole of the heat of the moment from what is a serious threat to someone's life that may be a felony if made.
As Justice Frankfurter said for this Court many years ago, the language of the picket line is not the language of the parlor.
The niceties that prevail in the courtroom are not always the ways of blue collar witnesses.
Unknown Speaker: But at least preserve the apparent integrity of the system of justice by not announcing that you are making an award to a perjurer.
Isn't that a very sensible rule?
Don't make a finding of perjury and then give an award to the individual.
Mr. Wallace: I think that it's a rule that would be within--
Unknown Speaker: I think the Board could live with that, don't you?
Mr. Wallace: --It is a rule that would be within the Board's discretion under the provisions of the act.
Unknown Speaker: Thank you, Mr. Wallace.
Mr. Jansonius, you have 4 minutes remaining.
Rebuttal of John V. Jansonius
Mr. Jansonius: Just a quick comment on Chevron, and I realize I'm speaking to the author of the opinion and a justice who has written Law Review articles on it, so I'll try to be quick.
Unknown Speaker: And one who has reversed on it.
Mr. Jansonius: And that, too.
Unknown Speaker: And the three don't agree with one another as to what it means, so--
Mr. Jansonius: My point on Chevron is that I'm not sure that... at least I wouldn't want to take for granted that Chevron analysis applies.
I think that was a different situation.
It involved a very complex regulatory scheme, it involved a set of regulations that clearly were within technical expertise of the administrative agency, and it involved a situation where the--
Unknown Speaker: --Don't you think the Board is supposed to have some technical expertise on how the labor market works?
Mr. Jansonius: --On how the labor market works.
I don't think they've shown that they have any expertise on how the administration of justice works, and that's really what we see this case as being, but that was a complex regulatory scheme where the agency involved had very carefully evaluated the regulations in question and explained why it was doing what it was doing.
That's not the situation here, and I guess I throw that out only to say that I wouldn't take for granted that Chevron analysis applies, but even under Chevron analysis I think that the decision of the Tenth Circuit to enforce the NLRB's order was clearly incorrect.
Mr. Wallace stated that Judge Maloney's finding about the lie was gratuitous.
It wasn't gratuitous at all.
To those of us who were in the courtroom, particularly those of us who heard all the evidence, it was very clear what Mr. Manso was doing.
He was trying to misuse the system for personal gain.
It was a very clear attempt to shape the outcome of the case, and that's why Judge Maloney felt compelled to use strong language.
Your Honors, Congress assigned to the Federal courts the power and the responsibility to enforce or not to enforce--
Unknown Speaker: May I just ask one question on that?
Mr. Jansonius: --Yes.
Unknown Speaker: When you were before the Labor Board as opposed to the ALJ, did you ask the Labor Board to adopt the rule you're asking this Court to adopt?
Mr. Jansonius: Ask the ALJ?
Unknown Speaker: No, no... before the Labor Board, in review of the ALJ's proceeding.
Mr. Jansonius: Yes, we did.
Unknown Speaker: You asked the Labor Board--
Mr. Jansonius: We most certainly did, and put it in our brief... but Congress did assign to the Federal courts the responsibility to enforce or not to enforce decisions by the National Labor Relations Board.
Congress also assigned to this Court the responsibility for drafting rules of evidence, and those rules of evidence are now statutory.
None of those rules of evidence has a longer lineage, none of them is more uniformly applied, none of them is less discretionary than the rule that--
Unknown Speaker: --We have to apply the same rule to a district court, then, you say.
Mr. Jansonius: --Exactly.
Unknown Speaker: Anybody who doesn't tell the truth under oath is not entitled to monetary remedy?
Mr. Jansonius: No, I'm not saying that, Your Honor.
I think that the NLRB process is certainly peculiar enough that this Court can write an opinion that's narrow to the context we're dealing with.
Unknown Speaker: In other words, it's more serious to lie to an ALJ than to a district judge.
Mr. Jansonius: No, I think it's equally serious as to both, but I think the importance of having a rule enforcing the oath is particularly important in this context.
When I'm in civil court--
Unknown Speaker: You would say it for district judges, I assume, if district judges had discretion in whether to give relief or not.
Mr. Jansonius: --Well, I think that's true.
I think that--
Unknown Speaker: And what's different about the Board here is that the relief is discretionary.
They don't have to give this relief.
Mr. Jansonius: --The--
Unknown Speaker: They could find the employer guilty and give some other kind of relief or, indeed, no relief at all, I suppose.
Mr. Jansonius: --Certainly.
The difference that I believe exists is just in the process itself.
When we're in civil court we have great means to find out the true facts of the case, to get at the bottom of what happened, and to know before we go into the courtroom who's likely to tell the truth, who's not likely to tell the truth, and how do we get to the bottom of the true facts of the case.
We don't have that in--
Chief Justice Rehnquist: Thank you, Mr. Jansonius.
The case is submitted.
Unknown Speaker: The honorable court is now adjourned until Monday next at ten o'clock.
Argument of Speaker
Mr. Speaker: In 92-1550, ABF Freight Systems versus NLRB, the National Labor Relations Board found that petitioner had committed an unfair labor practice.
As a remedy for the wade violation, the Board ordered the petitioner, who is an employer, to reinstate one of its former employees with backpay.
The administrative law judge had found that the employee had given certain false testimony on an issue that turned out to be not material to the Board's decision.
The ourt of Appeals enforced the Board's order and we granted certiorari to consider whether the employee's false testimony should have precluded the Board from granting him relief.
For reasons stated in an opinion of the Court uttered by Justice Stevens, we hold that the Board acted within the discretion granted to it by the statute, and therefore, we affirm the judgment of the Court of Appeals.
Justice Kennedy has filed a concurring opinion; Justice Scalia has filed a separate opinion concurring in the judgment in which he is joined by Justice O'Connor.