Laro Maintenance Corp. v. National Labor Relations Board

Prompt Maintenance Services, Inc. (Prompt) provided maintenance services at a federal building on Cadman Street in Brooklyn, New York (Cadman). Most of Prompt’s 23 Cadman employees belonged to a union, Local 32B. Then, Laro Maintenance Corporation (Laro) (plaintiff) won the bid to perform maintenance services for Cadman, and Laro replaced Prompt. A government official asked Laro to try to keep some of Prompt’s employees. However, Laro had evidence that some of Prompt’s employees had performed poorly at Cadman. Eventually, Laro hired 10 of Prompt's prior Cadman employees. Laro refused to even interview, let alone hire any of Prompt’s 13 other Cadman employees. Instead, Laro replaced them with employees who had proven performance issues and who were less qualified. Laro also moved certain employees around to different worksites, changing the makeup of the union representation at the worksites. Even though Local 355 only represented a minority of the Cadman workers, Laro then negotiated a new union contract at Cadman with Local 355 instead of with Local 32B. Local 32B believed Laro had violated the National Labor Relations Act (NLRA) by: (1) contracting with Local 355 instead of Local 32B even though Laro knew Local 355 only represented a minority of workers, and (2) refusing to hire some of the prior Prompt employees because of their union status. Local 32B sought relief from the federal National Labor Relations Board (NLRB) (defendant). An administrative law judge found that Laro’s hiring practices at Cadman were designed to undercut Local 32B’s membership at Cadman and give Local 355 the dominant position in violation of the NLRA. The NLRB ordered Laro to restore Local 32B’s dominance at Cadman by rehiring the transferred or dismissed Prompt employees. Laro petitioned the United States Court of Appeals for the District of Columbia Circuit for review.