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REUBEN v. FDIC

April 10, 1991

S. JESSE REUBEN, Regional Director of The Washington, D.C., Region of The Federal Labor Relations Authority, for and on Behalf of The FEDERAL LABOR RELATIONS AUTHORITY, Plaintiff,
v.
FEDERAL DEPOSIT INSURANCE CORPORATION, Defendant



The opinion of the court was delivered by: BOUDIN

 MICHAEL BOUDIN, UNITED STATES DISTRICT JUDGE

 In this case plaintiff, Regional Director of the Washington, D.C. Region of the Federal Labor Relations Authority, seeks a temporary injunction against the Federal Deposit Insurance Corporation ("FDIC"), to compel the FDIC to recognize and bargain with the union representing certain of the FDIC's employees. The union, National Treasury Employees Union ("Union"), has filed memoranda amicus curiae in support of the Authority. For the reasons stated below, the requested temporary injunction is granted. This memorandum opinion constitutes the Court's findings of fact and conclusions of law.

 I. THE FACTS

 Among the functions of the FDIC is the liquidation of various failed banks across the country. A large number of employees engaged in this activity are hired by the FDIC on a non-competitive basis as temporary employees of the agency. The FDIC currently has thousands of such employees located at sites throughout the United States.

 The Federal Labor Relations Authority ("FLRA" or "Authority") performs for federal employee labor relations functions similar to those performed by the National Labor Relations Board for non-federal employees. The Authority acts pursuant to the Federal Service Labor-Management Relations Act ("FSLMRA"), 5 U.S.C. § 7101 et seq. (1980 & Supp. 1990).

 The present controversy arises out of the efforts of the Union, a labor organization representing over 100,000 federal employees, to represent certain professional and non-professional employees of the FDIC's Division of Liquidation, Division of Accounting and Corporate Services and Legal Division employed at FDIC offices located throughout the United States, about 80 percent of whom are temporary employees. Beginning in late April 1990 and continuing through May 1990, the Authority conducted a representation election among these employees. The Union prevailed in the election. Professional employees favored a bargaining unit separate from non-professional employees, and therefore two separate elections were conducted. Among the professional employees, there were 76 valid votes cast, 46 of which, or 66 percent, were in favor of the Union. With respect to the non-professional employees, there were 1,848 valid votes cast, 1,273 of which, or 69 percent, were in favor of the Union.

 Immediately after the election, the FDIC filed objections with the Authority seeking to have the election invalidated because of actions taken by the Union in the course of the election campaign. Specifically, the FDIC objected to the Union's promise to the temporary employees it sought to represent that, if successful in the election, it would file a lawsuit challenging their temporary status and seeking a measure of tenure for them. The FDIC also complained that the Union had provided free legal representation prior to the election to some five employees who had been terminated by the FDIC.

 On August 21, 1990, the Authority's Regional Director ("RD") in its Washington, D.C. Regional Office rejected, in a detailed opinion, the FDIC's challenge to the election on these two grounds. The FDIC sought review of the RD's decision by the Authority itself. On December 14, 1990, the Authority denied the FDIC's petition for review. On December 28, 1990, the Authority certified the Union as the exclusive representative of the two bargaining units, one for professional and one for non-professional employees.

 Under the FSLMRA, as under the Labor-Management Relations Act ("LMRA"), *fn1" an employer challenging a union election is not entitled to direct judicial review of an Authority decision upholding the election. See 5 U.S.C. § 7123(a)(2). Instead, such a decision may be brought before the courts only when an employer refuses to bargain with the newly certified union, is charged by the Authority with an unfair labor practice, offers as a defense the invalidity of the election, is found by the Authority to have committed the unfair labor practice, and then appeals that finding to the Court of Appeals. *fn2"

 In this case, when the Union in early January 1991 sought to negotiate with the FDIC on behalf of the employees in question, the FDIC responded in a letter dated January 25, 1991, that it would not comply with the bargaining request because it challenged the Union's certification. Accordingly, to this date the FDIC has refused to recognize the Union as the certified representative of the bargaining unit employees, has refused to negotiate with the Union, has refused to allow the Union to represent bargaining unit employees in connection with terminations, office closures and the like, *fn3" and has generally refused to accord to the Union those rights to which a certified bargaining representative is entitled under the FSLMRA. Accordingly, the Union filed an unfair labor practice charge with the Authority on February 4, 1991. On February 11, 1991, the Regional Director issued a complaint against the FDIC charging it with the commission of an unfair labor practice in violation of the FSLMRA, specifically 5 U.S.C. §§ 7116(a)(1), (5) and (8). *fn4" A hearing was scheduled before an Administrative Law Judge, but the parties have agreed to waive the hearing, stipulate to the facts and present the matter directly to the Authority. Briefs are due to be submitted to the Authority on April 16, 1991.

 On February 20, 1991, the Regional Director brought this action against the FDIC seeking a temporary restraining order and an injunction under section 7123(d) of the FSLMRA, 5 U.S.C. § 7123(d), to enjoin the FDIC from continuing to refuse to recognize and bargain with the Union during the pendency of the litigation over the unfair labor practice charge. Section 7123(d) empowers district courts to grant temporary relief, on petition of the FLRA, against any person who is the subject of a complaint before the Authority charging the person with engaging in an unfair labor practice. The standards and conditions for relief set forth in section 7123(d) are discussed in the following portion of this memorandum.

 After a hearing on February 21, 1991, this Court denied the request for a temporary restraining order, but set the matter down for hearing on the request for injunctive relief following an opportunity for the FDIC to respond in writing. The hearing was held on March 12, 1991. The Court requested supplemental briefs from the parties, which were filed on or before March 26, 1991, and the Court held an additional hearing on April 8, 1991, to obtain further information.

 II. DISCUSSION


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