David P. Twomey Professor of Law Carroll School of Management, Boston College Member of the Massachusetts and Florida Bars

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Labor & Employment Law: Text & Cases, Fifteenth Edition

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CHAPTER 1 Perspectives; Early Doctrines; Current Applications 1

CHAPTER 2 Congress, Administrative Agencies, and the Courts 27

CHAPTER 3 Railway and Airline Labor Relations Law 41

CHAPTER 4 The National Labor Relations Act 57

CHAPTER 5 Employer Unfair Labor Practices 139

CHAPTER 6 Regulation of Union Activities 201

CHAPTER 7 Legality of Strikes 245

CHAPTER 8 Dispute Settlement Law 277

CHAPTER 9 Regulating Internal Union Conduct: DFR, ERISA, and RICO 297

CHAPTER 10 Public Employment and Labor Law 329

CHAPTER 11 Occupational Safety and Health Law 361

CHAPTER 12 Discrimination Laws: Protected Classes under Title VII and the Constitution 395

CHAPTER 13 Procedures and Remedies 473

CHAPTER 14 Pay Equity; Age Discrimination 523

CHAPTER 15 Disability Discrimination Laws—Workers’ Compensation, SSDI and the ADA—Medical and Military Leaves 553


CHAPTER 16 Employment Relationships: Contractual and Tort Theories 597

CHAPTER 17 Employee Privacy Topics 633

CHAPTER 18 Wage and Hour Law—Plant Closings and Unemployment—Foreign Workers 677

APPEND IX A: Types of Cases Before the National Labor Relations Board 713

APPEND IX B: Labor Management Relations Act, 1947, as Amended by Public Laws 86-257, 1959 and 93-360, 1974 717

APPEND IX C: Excerpts from the Labor-Management Reporting and Disclosure Act of 1959 751

APPEND IX D: Excerpts from Title VII of the Civil Rights Act of 1964 as Amended by the Equal Employment Opportunity Act of 1972 759

APPEND IX E: Excerpts from the Civil Rights Act of 1991 763

APPEND IX F : Excerpts from the EEOC’s Uniform Guidelines on Employee Selection Procedures (1978) 773

APPEND IX G: Excerpts from the EEOC’s Guidance on Vicarious Employer Liability for Harassment by Supervisors 779

APPEND IX H: Excerpts from the Americans with Disabilities Act of 1990 783

APPEND IX I : Excerpts from the ADA Amendments Act of 2008 (S.3406, P.L. 110-325) 789








CHAPTER 1 Perspectives; Early Doctrines; Current Applications 1

Section 1 Introduction: Perspectives 1 2 Historical Context: The Criminal Conspiracy Doctrine 8 3 Historical Context: The Contractual Interference Doctrine 11 4 Historical Context: Early Applications of the Sherman Act 15 5 Injunctions and the Clayton and Norris-LaGuardia Acts 16 6 Continuing Impact of Antitrust Laws 21

CHAPTER 2 Congress, Administrative Agencies, and the Courts 27

Section 7 Introduction 27 8 Open Operations of Administrative Agencies 28 9 Agency “Regulations” as Law 29

10 The Adjudicatory Function 30 11 Exhaustion of Administrative Remedies 30 12 Court Review of Agency Findings of Fact 31 13 Court Review of Agency Determinations on Law and Policy:

The Chevron Framework 31 14 The Federal Court System 33


CHAPTER 3 Railway and Airline Labor Relations Law 41

Section 15 Introduction 41 16 Bargaining Representation 42 17 Mediation, Arbitration, and Emergency Boards 43 18 Major and Minor Disputes 45 19 Railroad and Airline Boards of Adjustment 48 20 The Surface Transportation Board 51 21 Strike Injunctions 52 22 Jurisdictional Issues: The RLA and the NLRA 52

CHAPTER 4 The National Labor Relations Act 57

Section 23 Introduction 58 24 Historical Development 58 25 Administration 62 26 Procedures 65 27 Jurisdiction: Employers Under the Act 68 28 Agency Law, Independent Contractors, “Contingent” Workers 72 29 Jurisdiction: Employees Under the Act 76 30 Jurisdiction: Preemption 86 31 Majority Bargaining Rights 93 32 The Appropriate Bargaining Unit 95 33 Multiemployer Bargaining Units 99 34 Craft Severance 102 35 Determining Employees’ Choice 102 36 Election Conduct and Free Speech 111 37 Election Propaganda and Misrepresentations 119 38 Bargaining Rights Based on Authorization Cards 121 39 Remedial Powers 125

CHAPTER 5 Employer Unfair Labor Practices 139

Section 40 Protection of Employee Rights 139 41 Freedom from Interference 141 42 Domination of Labor Organizations 150 43 Discrimination as to Hire and Tenure 156 44 Discriminatory Lockouts 160 45 Permanent Shutdowns 162 46 Discrimination for Concerted Activities 165 47 Union Security and “Right-to-Work” Laws 167 48 Discrimination for NLRB Action 170


49 Duty of Employer to Bargain 171 50 Successor Employers’ Obligations Under the NLRA 182 51 Rejection of Labor Contracts Under Chapter 11 of the Bankruptcy

Code 188

CHAPTER 6 Regulation of Union Activities 201

Section 52 Union Unfair Labor Practices 201 53 Picketing: Types and Constitutional Parameters 206 54 Mass Picketing 210 55 Union Access to Private Property 214 56 Organizational and Recognitional Picketing: Informational

Picketing 221 57 Jurisdictional Disputes 223 58 Secondary Activity: “Ally” and “Common Situs” Doctrines 225 59 Secondary Activity: Consumer Product Picketing, Handbilling,

and Bannering 228 60 Hot Cargo Agreements 235 61 Damages from Boycotts and Picketing 239

CHAPTER 7 Legality of Strikes 245

Section 62 Types of Stoppages 245 63 Employer Unfair-Labor-Practice Strikes 247 64 Permanent Replacement of Strikers 250 65 Unprotected Strike Activity 257 66 Effects of Strikes in Violation of NLRA Notice

Requirements 260 67 No-Strike Agreements 262 68 Norris-LaGuardia and No-Strike Injunctions 263 69 National Emergency Strikes 268

CHAPTER 8 Dispute Settlement Law 277

Section 70 Introduction 277 71 Definitions and Terms 278 72 Assisting Negotiations 280 73 Grievance Arbitration and the NLRA 281 74 The Courts and the Arbitration Process 285 75 Labor Arbitration of Statutory Discrimination Claims 286 76 Judicial Review of Arbitration Decisions 289


CHAPTER 9 Regulating Internal Union Conduct: DFR, ERISA, and RICO 297

Section 77 Introduction 297 78 Union’s Duty of Fair Representation (DFR) 298 79 Members’ Rights under the Union’s Constitution 305 80 Union Discipline: Section 8(b)(1)(A) 306 81 Rights of Members 310 82 Union and Management Reporting Requirements 313 83 Employee Retirement Income Security Act (ERISA) 314 84 Political Contributions and Expenditures 321 85 Antiracketeering Laws 322

CHAPTER 10 Public Employment and Labor Law 329

Section 86 Introduction: Current Controversies 329 87 Federal Employment 332 88 State and Local Employment 343 89 Congressional Power over State Employment Standards 355

CHAPTER 11 Occupational Safety and Health Law 361

Section 90 Purpose and Scope 361 91 Administration 362 92 Standards 363 93 Employer Duties 371 94 Protection from Retaliation 376 95 Inspection 379 96 Citations and Penalties 383 97 Overlapping Jurisdiction 387 98 Violence in the Workplace 387 99 State Programs 389

100 State “Right-to-Know” Legislation 390

CHAPTER 12 Discrimination Laws: Protected Classes under Title VII and the Constitution 395

Section 101 Introduction 395 102 Title VII as Amended 396 103 Race and Color 411 104 Religion 417


105 Sex 424 106 Employer Liability for Sexual Harassment 432 107 Employer Liability for Coworker and Nonemployee Sexual

Harassment 446 108 National Origin Discrimination and “English Only” Rules 448 109 Protection against Retaliation 451 110 Title VII: Section 703 Exceptions 456 111 Selected Constitutional Theories on Discrimination 464

CHAPTER 13 Procedures and Remedies 473

Section 112 Mixed-Motive Cases 473 113 Statistical Cases 476 114 Title VII Court-Ordered Remedies 479 115 Consent Decrees and Voluntary Affirmative Action Plans 485 116 Reverse Discrimination and Affirmative Action Plans 493 117 The Arbitration Option 497 118 Executive Order 11246: Affirmative Action Programs 506 119 Other Remedy Options 512

CHAPTER 14 Pay Equity; Age Discrimination 523

Section 120 Equal Pay for Equal Work 523 121 The Gunther Decision and Comparable Worth 529 122 Age Discrimination 534 123 Prohibited Practices and Damages 540 124 The Older Workers Benefit Protection Act; ADEA Exemptions and

Defenses 546

CHAPTER 15 Disability Discrimination Laws—Workers’ Compensation, SSDI and the ADA—Medical and Military Leaves 553

Section 125 Discrimination Against Disabled Workers 553 126 The Rehabilitation Act of 1973 555 127 The Amended Americans with Disabilities Act 562 128 Workers’ Compensation: Relationship to the ADA 575 129 Accommodation between SSDI and the ADA 582 130 Family and Medical Leaves of Absence 584 131 Military Leaves and Reemployment Rights 589


CHAPTER 16 Employment Relationships: Contractual and Tort Theories 597

Section 132 Employment at Will, Exceptions, and Discrimination Claims 597 133 Whistleblower Protection under the Sarbanes-Oxley

and Dodd-Frank Acts 610 134 Noncompetition Agreements 616 135 Employer Liability for Torts of Employees 619 136 Proper Classification of Workers 621 137 Negligent Hiring and Retention of Employees 623

CHAPTER 17 Employee Privacy Topics 633

Section 138 Historical Background, Introduction to Employee Privacy 633 139 Public Employees’ Privacy Rights 635 140 Private-Sector Employees: Property Searches 640 141 Invasion of Privacy 641 142 Monitoring Employee Telephone Conversations and E-Mail 644 143 Drug Testing 652 144 Alcohol Abuse and Employee Assistance Programs 660 145 Polygraph Examinations 662 146 Employee Defamation Claims 668

CHAPTER 18 Wage and Hour Law—Plant Closings and Unemployment— Foreign Workers 677

Section 147 Developing Law Regulating Wages and Hours 677 148 Plant Closing Laws: The Warn Act 689 149 Unemployment Compensation 693 150 Employment-Related Immigration Laws: Introduction 697 151 Employer Sanctions and Verification Responsibilities 698 152 Employer Discrimination 702 153 Business Visas 703

APPEND IX A: Types of Cases Before the National Labor Relations Board 713

APPEND IX B: Labor Management Relations Act, 1947, as Amended By Public Laws 86-257, 1959 and 93-360, 1974 717

APPEND IX C: Excerpts from the Labor-Management Reporting and Disclosure Act of 1959 751


APPEND IX D: Excerpts from Title VII of the Civil Rights Act of 1964 as Amended by the Equal Employment Opportunity Act of 1972 759

APPEND IX E: Excerpts from the Civil Rights Act of 1991 763

APPEND IX F : Excerpts from the EEOC’s Uniform Guidelines on Employee Selection Procedures (1978) 773

APPEND IX G: Excerpts from the EEOC’S Guidance on Vicarious Employer Liability for Harassment by Supervisors 779

APPEND IX H: Excerpts from the Americans with Disabilities Act of 1990 783

APPEND IX I : Excerpts from the ADA Amendments Act of 2008 (S.3406, P.L. 110-325) 789





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This textbook presents a comprehensive treatment of all of the major labor and employment topics of our time. It contains more materials than would ordinarily be covered in a one-semester course. The intent is for instructors to select the topics and materials that best fulfill their course objectives and the current needs of their students in the ever-changing business and political environment. The What’s New and Why segment (see page xvi) details the broad range of new and developing topics contained in this edition.


Legal essays on each section’s topics are carefully crafted to clarify the often chal- lenging complexities of our labor and employment laws. The self-outlining essays are student friendly, yet authoritative and neutral, with neither management nor employee bias. Detailed footnotes in each chapter are a hallmark feature of this text. The footnotes not only meticulously provide case citations for further research or assignments, but also provide interesting side stories to help illustrate the legal concepts explored, offer historical or additional information, and give dif- fering points of view to encourage critical thinking and discussion.


Each chapter contains numerous court and agency cases relevant to the topics at hand. Some cases were selected for their historical import, some for their particu- larly insightful discussion of the issues, some because they represent turning points in the law, and most because they deal with issues of current significance. All have


been carefully edited to remove extraneous discussion while preserving the integrity of the opinion. Where appropriate, lengthy or complex discussions have been sum- marized in brackets and, in some cases, dissenting opinions have been included. Each decision is followed by case questions to guide the student through the opin- ion and assist in identification of the cogent issues and arguments.

At the end of each chapter is a broad selection of case problems. These are derived from court and administrative agency decisions in real cases and offer stu- dents the opportunity to apply the legal principles to real-life situations. Citations at the end of each case problem enable students to research how the problem was actually resolved.


Chapter 1: Section 1 sets forth, with brief details, each of the federal labor and employment statutes treated in this book. All employers meeting the law’s jurisdic- tional thresholds are subject to the National Labor Relations Act. Some examples are given, showing the types of mistakes that both union and nonunion employers continuously make because of their lack of knowledge of this law. Perspectives on the antidiscrimination laws are discussed, including the question of why the win rate for Title VII cases in the federal courts is just 11 percent. New text addresses injunctions, the Norris-LaGuardia Act, and the nonstatutory labor exemption to the antitrust laws. The recent Brady v. National Football League decision is presented.

Chapter 2: This chapter extends the survey treatment of administrative law, and the Chevron framework for court review of agency determinations on law and pol- icy, by adding the new Mayo Foundation for Medical Education v. United States precedent. Some detail is required to explain why the new text on the “Pretrial Steps of a Lawsuit” is needed. We all understand that it is unacceptable and illegal to discriminate on the basis of race, color, religion, national origin, sex, age, or dis- ability. For example, Joanne Zippittelli applied for a promotion; her supervisor asked how old she was and she replied 63. The supervisor said she would “probably not get the position.” Joanne had better performance evaluations and a better atten- dance record than the younger person who was promoted to the job. Joanne believed she was the victim of age discrimination. She never got to have her case pre- sented to a jury because the federal trial court and appeals court ruled that the employer’s motion for summary judgment should be granted. Employers have a 63 percent success rate winning such cases, pretrial. It is critical for the students of labor and employment law to have a basic understanding of the Pretrial Steps of a lawsuit, where cases can now be terminated by federal judges not only through sum- mary judgment, but also through motions to dismiss, precluding plaintiffs from con- ducting discovery under the new plausibility pleading standards.

Chapter 3: This chapter has been rewritten to reflect the various crafts that make up appropriate bargaining units in both the rail and airline industries, and the new “simple majority” rule for conducting representation elections. The chap- ter has been compressed, covering the legal framework for resolving disputes according to the categories of “major” and “minor” disputes, featuring the new Brotherhood of Maintenance of Way Employees v. BNSF Railway precedent case.


Chapter 4: This comprehensive chapter covers the workings of the National Labor Relations Board. A major function of the Board is to conduct elections to determine if a majority of employees in an appropriate bargaining unit want a union to represent them. Misclassification of individuals as independent contractors rather than employees is a current issue with major adverse impact on employees, competing employers, and the government, so the subject is treated in detail. The topic “The Recognition Bar Doctrine,” dealing with an employer’s voluntary recog- nition of a union based on a showing of majority status by authorization cards rather than by an election, was modified by the Bush II Board in its 2007 Dana Corp. decision, with the Board majority expressing a preference for elections as opposed to authorization cards. With the composition of the Board changing with the election of President Barack Obama, a new Board majority overruled the Dana Corp. decision. Judge Harry Edwards points out that it is a fact of life in NLRB lore that interpretation of certain substantive provisions of the NLRA fluctuate with the composition of the Board, and if reasonable each decision is entitled to deference. Throughout this text, where issues are subject to such fluctuation, the positions of both sides are presented, leaving it to the reader to decide the correctness of the current ruling. Social media and employee rights under the NLRA to discuss terms and conditions of employment with coworkers is a new topic for this chapter. The NLRB’s General Counsel instituted a new priority action program under Sec- tion 10(j) of the Act to seek the temporary injunctive relief of return to work pend- ing the outcome of Board proceedings, when individuals are fired during union organizing efforts. The deletion of two cases, and more stringent editing of existing cases, allowed two new cases to be added to this chapter.

Chapter 5: This important chapter covers employer unfair labor practices. Managers and students can learn from the mistakes of others, as this chapter is studied. A new subsection entitled “Employer-Union Prerecognition Negotiations” is added, along with a precedent case recently decided by the NLRB. The scope of an employer’s duty to bargain with a union has been rewritten and expanded with topics such as “Employer’s Obligation to Furnish Information,” “Surface Bargain- ing,” and “Bargaining Impasses.”

Chapter 6: This chapter deals with union unfair labor practices. Perhaps the most complicated concepts under NLRB and Supreme Court precedents are the sec- ondary activities of unions, including consumer product picketing, handbilling, and bannering. New text on bannering reflects the 2011 NLRB decisions on this topic. A new court decision is presented in which a neutral employer successfully sued a union for damages caused by the union’s secondary picketing activity at a jobsite.

Chapter 7: While retaining the text and cases on the rights and obligations of employers and employees relating to strike activity, new text is presented on the use of Section 10(j) temporary injunctions to require the immediate reinstatement of unfair labor practice strikers.

Chapter 8: This chapter on dispute settlement law has been reorganized. It contains a new section on “Labor Arbitration of Statutory Discrimination Claims” reflecting the Supreme Court’s recent Pyett decision, which now permits employers and unions to bargain away individual employees’ rights to pursue statutory dis- crimination claims in federal court, relegating union members to arbitration for resolution of their claims.


Chapter 9: While containing coverage of the union’s duty of fair representa- tion for its members, this chapter also contains updates on a union’s right to disci- pline its members. The materials on ERISA are expanded to more fully explain the distinctions between defined contribution plans and defined benefit plans, and the reasons that defined contribution plans are now the plans most frequently offered by employers.

Chapter 10: Public-sector labor laws are in transition as state legislative bodies consider measures that restrict, eliminate, or modify collective bargaining rights. A new section is added to the text outlining the current controversies, as well as the selected approaches taken to resolve fiscal troubles either unilaterally by legislative action or through concessions obtained via collective bargaining. The material on contractual impasse settlement procedures has been rewritten to reflect current pro- gressive practices.

Chapter 11: The Occupational Safety and Health Act has been remarkably effective, as can be seen from the following statistics. In 1970 when the law was enacted, with the U.S. population then at 203,000,000, more than 14,000 workers were killed in industrial accidents. In 2009, with the U.S. population at an esti- mated 307,000,000, some 4,551 workers were killed in work-related incidents. In a 2011 ruling by the Occupational Safety and Health Review Commission, it over- turned a 2007 OSHRC decision and returned to the longstanding precedent that a general contractor, who created or controlled a hazard to which one or more employees of a subcontractor were exposed, can be held responsible for a serious violation of the act and assessed a penalty.

Chapter 12: This comprehensive chapter covers Title VII of the Civil Rights Act of 1964. It has been rewritten in major respects. For example, new text addresses the current focus of litigation by the EEOC on its new Systemic Class Action Program. Under this program, when the EEOC perceives a statutory viola- tion during its investigation of an individual charge, it may bring a class action lawsuit against the employer, issuing comprehensive subpoenas for records of all similarly situated individuals. Private class action lawsuits are also significant mat- ters for employers today, but they must meet the Supreme Court’s recent Wal-Mart Stores v. Dukes analysis. With the success rate for Title VII cases in federal courts at just 11 percent, understanding burdens of proof for disparate treatment and dis- parate impact cases is critical for both plaintiffs and defendant-employers in evalu- ating their settlement and litigation options. New text explains these theories with appropriate examples. New text also discusses the discrimination law dealing with employee garments worn for religious reasons. The section on pregnancy-related benefits and job protection has been rewritten. The Glenn v. Brumby case presents the developing theory of sex stereotyping based on the PriceWaterhouse v. Hopkins precedent as successfully applied to a transgender individual. Retaliation claims are now the most frequent type of claim filed with the EEOC. Four Supreme Court decisions from 2008–2011 have enhanced retaliation rights and expanded the reach of retaliation claims beyond Title VII to other employment- related statutes.

Chapter 13: Dealing with procedures and remedies regarding discrimination cases, including affirmative action programs, this chapter also expands the treatment of awards of attorneys’ fees. It includes a presentation of the EEOC v. Peoplemark


decision, in which the EEOC was required to pay some $752,000 in attorneys’ fees, expert witness fees, and other expenses because it should have known its Systemic Class Action suit against the temporary staffing company was devoid of merit. Many employers require their employees to arbitrate all claims, including statutory discrimination claims, arising in their employment relationship. The text contains coverage of these issues regarding mandatory employment arbitration of statutory discrimination claims. Under Executive Order 11246, the Office of Federal Contract Compliance Programs has responsibility for compliance with affirmative action pro- grams of federal contracting agencies. In July 2011, the agency announced its policy of thorough, careful reviews of federal contractors, with increased focus on compen- sation discrimination and affirmative action, as bolstered by a staff increase of 35 percent over a two-year period, including 200 new compliance officers.

Chapter 14: Covering pay equity and age discrimination, this chapter presents the 2011 Equal Pay Act decision of Renstrom v. Nash Finch, which analyzes all the elements that are required for success in an Equal Pay Act case. The Supreme Court’s Gross v. FBL Financial Services, Inc. decision is discussed, making clear that decisions construing Title VII do not control the construction of the Age Discrimination in Employment Act; the decision ruled out mixed-motive theories under the ADEA.

Chapter 15: The dramatic changes to the Americans with Disabilities Act wrought by the ADA Amendments Act of 2008 provided an opportunity to rewrite the complicated text to reflect the ADAAA’s expressed intent that the “question of whether an individual’s impairment is a disability under the ADA should not demand extensive analysis.” The 2010 Horgan v. Simmons decision for the plaintiff, presented in the text, is supportive of the now straight forward analysis of disability cases. The Family and Medical Leave Act has a “key employee” exemption under which an employer may deny restoration of such an employee to employment. New text treats this exemption, and the technical condi- tions that must be complied with, in the Neel v. Mid-Atlantic of Fairfield case. Military Leaves and Reemployment Rights are discussed in expanded text. The Supreme Court adopted the Subordinate Bias Doctrine (or The Cat’s Paw Theory) in its 2011 Staub v. Proctor Hospital decision. The Serricchio v. Wachovia Securi- ties, LLC decision addressed the issue of the employer’s obligation to provide the same terms of employment as the reservist had prior to service in Iraq. It also addressed whether the reservist was entitled to liquidated damages.

Chapter 16: Section 16.2 contains an update on the SOX whistleblower law, and presents the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, with its rather dramatic expansion of the SOX Act cause of action, allowing immediate lawsuits in federal court and bounties. The Brown v. Lockheed Martin Department of Labor ARB decision shows the ruin to a whistleblower employee’s health and career. Proper classification of workers is again addressed in this chap- ter, noting that employers who misclassify employees as individual contractors may be held liable for the misclassified employees’ torts, and lack proper liability coverage.

Chapter 17: In a 2011 decision, the U.S. Supreme Court addressed the argu- ments of NASA contract workers at Cal Tech that NASA violated their U.S. con- stitutional right to informational privacy by its employment background check


questions, with the Court determining that the government had legitimate interests at stake, and that the individuals have the protections of the Privacy Act of 1974. The Supreme Court also decided a Fourth Amendment privacy case against a law enforcement officer regarding the search of his text messages in its City of Ontario, California v. Quon decision. A current case is discussed in which an employer was allowed, under a limited exemption, to request an employee to submit to a poly- graph test.

Chapter 18: In the presentation of wage and hour law, a discussion is added on the law regarding the utilization of unpaid interns. With the economic down- turn and an increase in WARN Act cases, Section 18:2 has been rewritten to reflect the developing law in this area. The sections on employment-related immi- gration law have been rewritten to reflect the administrative changes by USCIS under its 2011 final rule on acceptability of identity documents. Verification through the E-Verify system and the USCIS statistics on the workings of the system are presented. The Supreme Court’s 2011 Chamber of Commerce v. Whiting deci- sion, on the constitutionality of Arizona’s Legal Arizona Workers Law, is presented.


Accessing CengageBrain

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“Sign Up” in the top right corner of the page and fill out the registration information. (After you have signed in once, whenever you return to CengageBrain, you will enter the user name and password you have chosen and you will be taken to the companion site for your book.)

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The Instructor’s Manual for the 15th edition of Labor & Employment Law contains questions and answers for each of the cases reported in the text as well as answers to end-of-chapter questions and case problems. The manual includes an “Author’s Comments” feature, which offers suggestions for sparking classroom discussion while referencing specific cases, footnotes, and sections of the text.


The companion website for this edition of Labor & Employment Law offers links to the following: important labor and employment law sites; labor and employment law blogs; legal forms and documents; free legal research sites (com- prehensive and circuit-specific); help in the classroom; and labor and employment law directories, departments, agencies, associations, and organizations. In addition, a list of recent labor and employment law cases with links directly to the excerpted versions is available on the website.

Many instructors set aside time each week to discuss current labor and employment law issues as they develop by requiring student reports to the class drawing from local and national newspapers, current periodicals and news maga- zines, and current court decisions. By using the vehicle of current issues, you can put the struggle between management and labor in perspective, draw students into the controversy, and thereby help them crystallize in their own minds the argu- ments on both sides, the conflicting interests and the balance and compromise so necessary in our complex society.


I wish to thank all those who have helped make this book possible, especially the reviewers of this and prior editions: Christine Neylon O’Brien, Boston College; Michael K. Fee, Esq., of Needham, Massachusetts; Len Bierman, Texas A&M University; Wayne Davis, Webster University; Anne L. Draznin, University of Illinois, Springfield; Hank Findley, Troy University; Laura J. Hanson-Brown, Web- ster University: Brian Heshizer, Georgia Southwestern State University; Richard J. Hunter, Jr., Seton Hall University; Ghadir Ishquaidef, University of Kansas; Penelope R. Jennings, California State University, Northbridge; Doug Kennedy, University of Wisconsin, Stout and St. Mary’s University of Minnesota; Nancy Lahmers, Fisher College of Business, Ohio State Univeristy; Susan Mae McCabe, Kellogg Community College; Lisa Moeller, Beckfield College; William B. Read, Husson University; Judy N. Rudolf, South College, Asheville; David Skeen, Webster University, Luke AFB Campus; Beth Anne Wolfson, Bentley University; Kiren Dosanjh Zucker, California State University, Northbridge; and Bruce Zucker, California State University, Northbridge. I am grateful for the research assistance and helpful comments of my colleague Margo E. K. Reder. Amy Hinz and Kathleen M. Kyratzoglou provided invaluable assistance in the preparation of the manuscript.

Suggestions for the improvement of this book will be most cordially welcomed.

David P. Twomey Carroll School of Management,

Boston College Chestnut Hill, Massachusetts


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Professor David P. Twomey has been teaching and writing in the Labor and Employment Law area as a member of the Business Law Department of the Carroll School of Management at Boston College since 1968. He is a member of the National Academy of Arbitrators and has served as arbitrator in more than 2,000 labor-management disputes throughout the country. His service includes appoint- ments, by Presidents Ronald Reagan, George H. W. Bush, William J. Clinton, and George W. Bush, to eight Presidential Emergency Boards, whose recommendations served as a basis for the resolution of major disputes in the rail and airline indus- tries. His work is neutral and authoritative. Recent examples of his work, published as lead articles in the Labor Law Journal, are:

• David P. Twomey, Employment Retaliation Claims under the Supreme Court’s Burlington, Crawford and Thompson Decisions: Important Implications for Employers, 62 LABOR LAW JOURNAL 2, 57–66 (Summer 2011).

• David P. Twomey, The Supreme Court’s 14 Penn Plaza v. Pyett Decision: Impact and Fairness Considerations, 61 LABOR LAW JOURNAL 2, 55–66 (Summer 2010).

• David P. Twomey, The Employee Free Choice Act: Congress, Where Do We Go from Here?, 60 LABOR LAW JOURNAL 2, 71–81 (Summer 2009).

He is coauthor of a widely used business law textbook. His articles have appeared in journals such as Best’s Review, The American Business Law Journal, The Massa- chusetts Law Quarterly, The Florida Bar Journal, and The Business Law Review.

After service in the U.S. Marine Corps, he graduated from Boston College, earned his M.B.A. at the University of Massachusetts, Amherst, and earned a J.D. degree at Boston College Law School. He is a member of the Massachusetts and Florida Bars.


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1:1 Introduction: Perspectives

1:2 Historical Context: The Criminal Conspiracy Doctrine

1:3 Historical Context: The Contractual Interference Doctrine

1:4 Historical Context: Early Applications of the Sherman Act

1:5 Injunctions and the Clayton and Norris-Laguardia Acts

1:6 Continuing Impact of Antitrust Laws


In the United States, the relationship of employer and employee is a contractual one. If the employment contract does not have a definite duration, it is terminable at will. Under this employment-at-will doctrine, the employer historically was free to hire or not hire, and free to discharge any employee for any reason or no reason. The employee was free to leave his or her employment at any time for any reason. Gradually, federal and state statutes were enacted to provide certain individual rights to workers, protecting them from workplace exploitation and discrimination by employers. Absent this statutory protection, however, or a narrow court-created contract or tort exception, the employment-at-will doctrine is still the basic default rule governing employment in the United States.


A separate set of rules governs the negotiation and enforcement of collective bargaining contracts between unions and employers, as developed under the Rail- way Labor Act and the National Labor Relations Act.1

The federal statutes affecting employment relations covered in this book are:

• The Railway Labor Act of 1926 as amended (RLA), which regulates the rights of individuals to form unions and engage in collective bargaining in the rail- way and airline industries.

• The National Labor Relations Act of 1935 (NLRA) and the Labor Management Relations Act of 1947 (LMRA), which govern the rights of individuals in the private sector to form and join labor unions and to engage in collective bargaining.

• The Fair Labor Standards Act of 1938 (FLSA), which sets minimum wages and regulates overtime pay and child labor.

• The Labor-Management Reporting and Disclosure Act of 1959 (LMRDA), which regulates the relationship between labor unions and their members and provides a bill of rights for union members.

• The Equal Pay Act of 1963 (EPA), which prohibits gender-based compensation differentials for work requiring equal skill, effort, and responsibility.

• Title VII of the Civil Rights Act of 1964, as amended in 1972 and 1991, which prohibits discrimination in employment on account of race, color, religion, national origin, or sex.

• The Age Discrimination in Employment Act of 1967, as amended (ADEA), which prohibits discrimination in employment on account of age.

• The Occupational Safety and Health Act of 1970 (OSHA), which seeks to assure all workers safe and healthful working conditions.

• The Rehabilitation Act of 1973, which requires the federal government as an employer to implement affirmative action plans on behalf of handicapped employees, and also requires federal contractors to take affirmative action to employ the handicapped.

• The Employee Retirement Income Security Act of 1974 (ERISA), which sets vesting rights, fiduciary and administrative standards, and reporting require- ments for employee pension and benefit plans.

• The Pregnancy Discrimination Act of 1978 (PDA), which amended Title VII of the Civil Rights Act of 1964, prevents employers from treating pregnancy, childbirth, and related medical conditions in a manner different from other medical conditions, and provides protection from adverse employment action because of pregnancy.

1 Collective bargaining contracts govern the rights and obligations of employers and employees subject to these contracts. Under collective bargaining, representatives of the employees bargain with a single employer or a group of employers for an agreement on wages, hours, and working conditions. The agreement worked out by the representatives of the employees, usually union officials, is generally subject to a ratification vote by the employees. Terms usually found in collective bargaining contracts are (1) identification of the work belonging exclusively to designated classes of employees; (2) wage and benefit clauses; (3) promotion and layoff clauses, which are usually tied in part to seniority; (4) a management’s rights clause; and (5) a grievance-arbitration procedure. A grievance-arbitration procedure provides a means by which persons claiming that the contract was violated or that they were disciplined or discharged without just cause may ultimately have their cases decided by impartial labor arbitrators.


• The Immigration Reform and Control Act of 1986 (IRCA), which protects lawful aliens against discrimination because of their national origin or citizen status.

• The Employee Polygraph Protection Act of 1988 (EPPA), which generally protects private-sector job candidates and employees from being subjected to lie detector tests.

• The Worker Adjustment and Retraining Notification Act of 1988 (WARN Act), which requires employers with 100 or more employees to give 60 days’ notice of plant closings if 50 or more workers at one site are to lose their jobs; it also has a mass layoff provision.

• The Americans with Disabilities Act of 1990 (ADA), which prohibits discrimina- tion in employment on account of disability. The ADA Amendments Act of 2008 (ADAAA) states that the definition of disability shall be construed in favor of broad coverage to individuals under the ADA, to the maximum extent possible.

• The Older Workers Benefit Protection Act of 1990 (OWBPA), which amended the ADEA, prohibits age discrimination in employee benefits.

• The Family and Medical Leave Act of 1993 (FMLA), which requires covered employers to provide eligible employees with up to 12 weeks of unpaid leave for certain family and medical reasons.

• The Uniformed Services Employment and Reemployment Rights Act of 1994, which protects civilian job rights of individuals who leave their jobs for active military service.

• The Health Insurance Portability and Accountability Act of 1998 (HIPAA), which holds health care providers and their employees to strict privacy stan- dards regarding individually identifiable health information in any form.

• The Sarbanes-Oxley Act of 2002 (SOX), which contains protections for employee corporate whistleblowers who provide information regarding mail, wire, bank, or securities fraud; any violation of an SEC rule; or any federal law protecting shareholders against fraud.

• The Genetic Information Nondiscrimination Act of 2008 (GINA), which pro- vides protection for employees against discrimination in employment on the basis of genetic information. “Company doctors” administering medical examinations must not ask for DNA tests or family medical histories.

• The Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (Dodd-Frank), which expands whistleblower protections to a wide range of financial services employees, and provides bounties to whistleblowers on monetary recoveries that aggregate to more than $1 million.

The states also have a very important role in the regulation of employment relationships between employers and employees. Among other things, they admin- ister unemployment compensation insurance programs, regulate workers’ compen- sation programs, and set public policy regarding the termination of at-will employees and state and local government employee collective bargaining rights.


The decline in the number of unionized workers in the United States is seen by some as a reason to deemphasize the study of labor relations law. It is true that since 1983, the first year for which comparable union data are available, the


percentage of U.S. workers belonging to unions has shrunk from 20.1 percent of the nation’s workforce to approximately 11.9 percent (in 2010). The highly union- ized blue-collar sectors of our economy, including manufacturing, mining, and transportation, have suffered employment declines, often due to improved labor- saving technology. This decline has adversely affected the percentage of unionized workers in the United States. However, approximately 21.8 percent of our nation’s transportation and utility workers continue to be represented by unions, with 15.8 percent of telecommunications, 10.7 percent of manufacturing, and 13.1 per- cent of construction workers maintaining union membership. Some 36.2 percent of all employees in federal, state, and local government service are union members. Labor has not been very successful in organizing so-called white-collar workers, such as clerical, professional, technical, sales, and other such employees. Musicians, actors, and professional athletes are highly unionized, and many college faculty members, engineers, physicians, and nurses are unionized. About 14.7 million U.S. workers belonged to unions in 2010; some 1.6 million other workers are repre- sented by unions even though they are not union members, and many other mil- lions of U.S. workers receive wage and benefit adjustments comparable to or in excess of union wage rates and benefits because their employers track and pay dif- ferentials so as to avoid the unionization of their companies.2


Labor relations laws do not apply only to unionized employers. All employers that meet appropriate jurisdictional requirements are subject to federal labor laws, and their employees have the right to form and join labor unions. The employers are obligated to bargain with union representatives if a majority of the employees in an appropriate bargaining unit choose such representation.

A narrow, summary treatment of United States labor laws is of some informa- tional value to students of management, human resources, and economics. How- ever, our labor laws are quite complex. Since enactment of the Railway Labor Act in 1926, to the present, the courts have been called on to resolve constantly devel- oping and very difficult policy questions in labor relations law. Often labor law decisions involve the interaction of several laws, including antitrust, anti- injunction, and labor relations law, as presented in the Brady v. National Football League decision reported in this chapter. However, when considered category by category and case by case, the elements of complex legal doctrines become clear and understandable.

UNIONIZED EMPLOYERS. Employers cannot threaten, coerce, or restrain employees in the exercise of their statutory rights under the NLRA, including their right to strike. Employers have the broad right to manage their business as they see fit, subject to the terms of their collective bargaining agreement(s), if one or more exist. On April 20, 2011, the National Labor Relations Board (NLRB) filed a complaint against the Boeing Company based on statements made by high Boeing executives, applicable to

2 For the latest information on union membership, see


its union-represented employees, that it would remove or had already removed work from Boeing’s facilities in the Puget Sound area of Washington state because the employees had struck Boeing in the past; the statements threatened or impliedly threatened that the Washington unit would lose additional work in the event of future strikes. The alleged comments were connected to the company’s plan for a new South Carolina production facility for its 787 jetliners. Boeing disagrees with the factual assertions related to the complaint and asserts its right to build planes in South Carolina.

Louis of Boston is one of that city’s priciest clothing stores. The president of Louis decided to contract out the alteration work formerly performed by in-house tailors. She believed that she had the legal right to outsource the work and lay off the employees at the expiration of the store’s collective bargaining contract with the Needles Trades union. As will be seen in Chapter 5, labor law is not that simple, and an employer’s bargaining obligation does not end at the expiration of the contract. After consulting with an employment law attorney and following 19 days of intermit- tent protests and adverse publicity, Louis of Boston issued an apology for not having followed the letter and spirit of the law and reinstated its nine tailors with back pay.

NONUNION EMPLOYERS. The owner of the famous Boathouse restaurant in New York City’s Central Park terminated more than 30 employees who had petitioned for union recognition. These employees—waiters, bartenders, and busboys—were employees at will. The restaurant’s management believed that it had not violated any labor laws in dismissing them as it saw fit. However, with the NLRB about to issue a far-reaching complaint of labor law violations, the restaurant offered to return all of the fired employees to work, with back wages, and to negotiate a col- lective bargaining contract with the Hotel Trades Council union. Nonunion employers need to know that employees who form or are forming a labor organi- zation are protected under the National Labor Relations Act against discharge or other adverse employer actions in retaliation for the employees’ union activities.

Faced with employee discontent about changes in the company’s pay and bene- fit policies implemented due to adverse economic conditions, and later aware that a union was initiating an organizing campaign, the president of Electromation Inc. set up company action committees with company-selected employee representatives to seek solutions to the numerous problems affecting employees. The NLRB decided that the president had formed an illegal labor organization and usurped his employ- ees’ legally protected right to bargaining representation of their own choosing.

Employee and management cooperation is very important in today’s global economy. Whether it is a nonunion or union company, thorough knowledge of the intricacies of labor relations law is essential in setting up lawful employee- management teams. The extent of management rights in this regard is presented in Chapter 5.


Employment discrimination based on race, color, religion, national origin, gen- der, age, or disability is both unacceptable and illegal in our society. When four white executives of Texaco, Inc., were caught on tape making racist statements


about minority employees and discussing how to conceal evidence sought by the plaintiffs in a racial discrimination lawsuit, the company had no defense for such inexcusable and intolerable conduct. Within two weeks of release of the tape, Texaco agreed to settle the underlying lawsuit for $176.1 million.3 Laura Zubulake filed a sex discrimination lawsuit against her employer, UBS Warburg LLC, and instead of the employer’s human resources personnel making a diligent inquiry into her complaints, evidence found in e-mails subpoenaed in pretrial discovery indicated that senior management decided to “exit her ASAP.” Her attorney believed that, instead of helping her, the company made every effort to build a file against her. This case went to trial and the jury awarded Zubulake $2,214,009 in back pay, $6,863,100 in front pay, and $20,169,081 in punitive damages.4 Novartis Pharmaceuticals Corp. agreed to a $175 million settlement of a nationwide class action lawsuit of systemic sex bias in pay, promotions, and pregnancy leave.5 The EEOC’s new Systemic Class Action Program has been suc- cessful in pursuing discrimination cases affecting large classes of individuals under every statute enforced by the agency.6

Despite the plaintiff-positive headlines that come from successful settlements and trials such as those just mentioned, employment discrimination plaintiffs are doing poorly in federal courts, whether before trial, at trial, or on appeal. In a 2009 article published in the Harvard Law & Policy Review, the authors’ find- ings showed that the win rate for federal trial court plaintiffs over the period from 1979 to 2006 was 15 percent in job discrimination cases, whereas the win rate in all other civil cases was 51 percent.7 In the period from 1998 to 2006, the win rate for Title VII cases was 10.9 percent—and there was a breathtaking drop of nearly 40 percent in the number of discrimination cases filed in the federal dis- trict courts from 1999 to 2007.8

In general, employers have become more careful to avoid discriminatory behavior. Moreover, employers are generally quick to settle discrimination charges prior to litigation when there is credible evidence of discrimination, lest they be exposed to adverse publicity and what they perceive as the possibility of runaway jury awards. The litigation hurdles in pretrial procedures (covered in Chapter 2), coupled with the low chances of success in federal courts, may very well dissuade attorneys from taking on discrimination cases and in part explain the remarkable drop in the number of lawsuits filed in federal courts.9 The mate- rials in this book’s employment discrimination chapters (chapters 12–15) provide

3 David Thomas, The Real Shame of the Texaco Case, BOSTON SUNDAY GLOBE, Nov. 17, 1996, at D1, D5. 4 John Herzfeld, Federal Jury Awards $29.2 Million to Fired UBS Equities Saleswoman, DLR No. 67, at 1 (April 8, 2005). 5 Janet Walthall, Novartis Female Sales Reps to Settle Sex Bias Class Action for $175 Million, DLR No. 135 (July 15, 2010). 6 See Section 12:1 of this text. 7 Kevin Clermont & Stewart Schwab, Employment Discrimination Plaintiffs in Federal Court: From Bad to Worse, 3 HARVARD L. & POL’Y REV. 3, 30 (2009). 8 Id. at 41. 9 Some of the decline can also be attributed to the mandatory arbitration of statutory discrimination claims increasingly required in initial employment contracts.


students with a framework for the individualized evaluation of cases involving discrimination based on race, color, religion, national origin, sex, age, and dis- ability, which will serve them well as future managers and human resources pro- fessionals, and enable them to take corrective action when discrimination is found to have occurred and defensive action when groundless claims of discrimination are raised.


The major federal labor-employment laws identified previously in this section are continuously developing, as issues are addressed and sometimes readdressed by administrative agencies and the courts, and to some degree reflect the political and economic climate of our time. Every chapter of this text contains new precedents and issues on chapter subject matter. A few examples follow.

• The National Mediation Board issued a new rule revising representation elec- tion procedures, which has had an impact on union representation elections in the railroad and airline industries.

• Misclassification of workers by employers as independent contractors rather than employees is having adverse implications for employees, competing employers, and the government, and is currently a major issue.

• The Supreme Court’s Pyett decision10 now permits employers and unions to bargain away individual employees’ rights to pursue statutory discrimination claims in federal court, relegating union members to arbitration for resolution of their claims.

• Public-sector labor laws are in transition as state legislative bodies consider measures that restrict, eliminate, or modify collective bargaining rights (see Chapter 10 on public employment and labor law).

• In a 2011 decision, the Supreme Court adopted a subordinate bias doctrine—a so-called cat’s-paw theory of discrimination—in a case involving alleged dis- crimination against an employee on the basis of military service under the Uniformed Services Employment and Reemployment Rights Act.11

• In 2010, “retaliation” claims were the type most frequently asserted in charges filed with the EEOC. The Supreme Court’s 2006 Burlington Northern & Santa Fe Railway Co. v. White12 decision lowered the standard that plaintiffs must meet to prove a retaliation claim under Title VII, and four additional Supreme Court decisions from 2008 to 2011 enhanced retaliation rights and expanded the reach of retaliation claims to other employment-related statutes. Retaliation is now widely considered a major liability area for employers, and the text provides guidance to reduce the risk of retaliation claims.

• Class action lawsuits alleging wage and hour violations of the Fair Labor Standards Act are presently the number-one exposure for most companies,

10 14 Penn Plaza v. Pyett, 129 S. Ct. 1456 (2009). 11 Staub v. Proctor Hospital, 131 S. Ct. 1186 (2011). 12 548 U.S. 53 (2006).


according to the head of the class action defense group at the major national law firm of Seyfarth Shaw LLP in Chicago.


The first recorded American labor relations case took place in Philadelphia and involved a criminal proceeding in 1806 against eight members of a guild of boot- makers and shoemakers (cordwainers) who had gone on strike against their employers: Commonwealth v. Pullis. The employer group of masters asked the jury to establish the principle that the strike of the guild members was a criminal conspiracy in restraint of trade. The cordwainers were charged with (1) mutually agreeing to refuse to work for an employer who paid less than a fixed rate (which was higher than what had customarily been paid), (2) agreeing to try to prevent other craftsmen from working except at this rate, and (3) agreeing not to work for anyone who employed a cordwainer who had broken the guild’s rules. The jury found the defendants guilty, and the court fined each defendant $8.

In the landmark 1842 decision Commonwealth v. Hunt, written by Chief Justice Lemuel Shaw of the Massachusetts Supreme Judicial Court, the court refuted, but did not squarely repudiate, the criminal conspiracy doctrine. Several members of the Boston Journeymen Bootmakers Society had been convicted of criminal conspiracy to withhold their services from an employer until such time as the employer discharged a journeyman named Jeremiah Horne, because Horne was not a member of the Bootmakers Society. The conviction was appealed, and the appeals court ruled that it was not an invalid purpose for the society to induce all those engaged in the same occupation to become members of the society. Accord- ing to the court, the legality of unions depended on their purpose and the means by which the purpose was carried out.


[From the judge’s charge to the jury.] What is the case now before us? … A combination of workmen to raise their wages may be considered in a twofold point of view: one is to benefit themselves [and] the other is to injure those who do not join their society. The rule of law condemns both. If the rule be clear, we are bound to conform to it even though we do not comprehend the principle upon which it is founded. We are not to reject it because we do not see the reason of it. It is enough, that it is the will of the

majority. It is law because it is their will—if it is law, there may be good reasons for it though we can- not find them out. But the rule in this case is pregnant with sound sense and all the authorities are clear upon the subject. Hawkins, the greatest authority on the criminal law, has laid it down, that a combination to maintaining one another, carrying a particular object, whether true or false, is criminal.…

In the profound system of law, (if we may compare small things with great) as in the profound systems of



Providence … there is often great reason for an institu- tion, though a superficial observer may not be able to discover it. If obedience alone is required in the present case, the reasonmay be this. One man determines not to work under a certain price and it may be individually the opinion of all: in such a case it would be lawful in each to refuse to do so, for if each stands, alone, either may extract from his determination when he pleases. In the turnout of last fall, if each member of the body had stood alone, fettered by no promises to the rest, many of themmight have changed their opinion as to the price of wages and gone to work; but it has been given to you in evidence, that they were bound down by their agree- ment, and pledged by mutual engagements, to persist in it, however contrary to their own judgment. The con- tinuance in improper conduct may therefore well be attributed to the combination. The good sense of those individuals was prevented by this agreement, from hav- ing its free exercise…. Is it not restraining, instead of promoting, the spirit of ’76 when men expected to have no law but the Constitution, and laws adopted by it or enacted by the legislature in conformity to it? Was it the spirit of ’76, that either masters or journey- men, in regulating the prices of their commodities should set up a rule contrary to the law of their country? General and individual liberty was the spirit of ’76. It is our first blessing. It has been obtained and will be main- tained…. Thoughwe acknowledge it is the hard hand of

labour that promises the wealth of a nation, though we acknowledge the usefulness of such a large body of tra- desmen and agree they should have every thing towhich they are legally entitled; yet we conceive they ought to ask nothing more. They should neither be slaves nor the governors of the community.

The sentiments of the court, not an individual of which is connected either with the masters or journey- men; all stand independent of both parties… are unan- imous. They have given you the rule as they have found it in the book, and it is now for you to say, whether the defendants are guilty or not. The rule they consider as fixed, they cannot change it. It is now, therefore, left to you upon the law, and the evidence, to find the verdict. If you can reconcile it to your consciences, to find the defendants not guilty, you will do so; if not, the alter- native that remains, is a verdict of guilty.

[The jury found the defendants guilty of combining and conspiring to raise their wages, and the penalty was a fine of eight dollars for each defendant.]

Case Questions

1. How did the court view the combination of workers with respect to their intent?

2. Did the court find the continuance of the withholding of labor attributable to a combination?


SHAW, C. J…. The general rule of the common law is that it is a criminal and indictable offense for two or more to confederate and combine together, by concerted means, to do that which is unlawful or criminal, to the injury of the public, or portions or classes of the community, or even to the rights of an individual. This rule of law may be equally in force as a rule of the common law, in England and in this common- wealth; and yet it must depend upon the local laws of each country to determine whether the purpose to be accomplished by the combination, or the concerted means of accomplishing it, be unlawful or criminal in the respective countries…. Without attempting to review and reconcile all the cases, we are of the

opinion, that as a general description, though perhaps not a precise and accurate definition, a conspiracy must be a combination of two or more persons, by some concerted action, to accomplish some criminal or unlawful purpose, or to accomplish some purpose, not in itself criminal or unlawful, by criminal or unlawful means….

The averment is this: that the defendants and others formed themselves into a society and agreed not to work for any person who should employ any journey- man or other person not a member of such society after notice given him to discharge such workman.

The manifest intent of the association is to induce all those engaged in the same occupation to become members of it. Such a purpose is not unlawful. It



would give them a power which might be exerted for useful and honorable purposes, or for dangerous and pernicious ones. If the latter were the real and actual object, and susceptible of proof, it should have been specially charged. Such an association might be used to afford each other assistance in times of poverty, sickness, and distress; or to raise their intellectual, moral, and social condition; or to make improvement in their art; or for other proper purposes. Or the association might be designed for purposes of oppression and injustice. But in order to charge all those who become members of an associ- ation with the guilt of criminal conspiracy, it must be averred and proved that the actual, if not the avowed object of the association was criminal. An association may be formed, the declared objects of which are innocent and laudable, and yet they may have secret articles, or an agreement communicated only to the members, by which they are banded together for purposes injurious to the peace of soci- ety or the rights of its members. Such would undoubtedly be a criminal conspiracy, on proof of the fact, however meritorious and praiseworthy the declared objects might be. The law is not to be hood- winked by colorable pretenses. It looks at truth and reality, through whatever disguise it may assume. But to make such an association, ostensibly inno- cent, the subject of prosecution as a criminal con- spiracy, the secret agreement which makes it so, is to be averred and proved as the gist of the offense. But when an association is formed for purposes actually innocent, and afterward its powers are abused by those who have the control and manage- ment of it, to purposes of oppression and injustice, it will be criminal in those who thus misuse it, or give consent thereto, but not in the other members of the association. In this case, no such secret agreement, varying the objects of the association from those avowed, is set forth in this count of the indictment.

Nor can we perceive that the objects of this asso- ciation, whatever they may have been, were to be attained by criminal means. The means which they proposed to employ, as averred in this count, and which, as we are not to presume, were established by the proof, were, that they would not work for a person, who, after due notice, should employ a jour- neyman not a member of their society. Supposing the object of the association to be laudable and lawful, or at least not unlawful, are these means criminal? The

case supposes that these persons are not bound by contract, but free to work for whom they please, or not to work, if they so prefer. In this state of things, we can not perceive that it is criminal for men to agree together to exercise their own acknowledged rights, in such a manner as best to subserve their own interests. One way to test this is to consider the effect of such an agreement, where the object of the association is acknowledged on all hands to be a laudable one. Suppose a class of workmen, impressed with the manifold evils of intemperance, should agree with each other not to work in a shop in which ardent spirit was furnished, or not to work in a shop in which any one used it, or not to work for an employer who should, after notice, employ a jour- neyman who habitually used it. The consequences might be the same. A workman who should still per- sist in the use of ardent spirit, would find it more difficult to get employment; a master employing such a one might at times, experience inconvenience in his work, in losing the services of a skillful but intemperate workman. Still it seems to us, that as the object would be lawful, and the means not unlaw- ful, such an agreement could not be pronounced a criminal conspiracy….

We think, therefore, that associations may be entered into, the object of which is to adopt measures that may have a tendency to impoverish another, that is, to diminish his gains and profits, and yet so far from being criminal or unlawful, the object may be highly meritorious and public-spirited. The legality of such an association will therefore depend upon the means to be used for its accomplishment. If it is to be carried into effect by fair or honorable and lawful means, it is, to say the least, innocent; if by falsehood or force, it may be stamped with the character of conspiracy….

Several other exceptions were taken, and have been argued; but this decision on the main question has rendered it unnecessary to consider them.

It is so ordered.

Case Questions

1. What was the “manifest intent” of the labor organization in the case?

2. How does the court define a criminal conspiracy?

3. State the rule of law developed by the court.



The weapons used by organized labor in the 1870s, 1880s, and 1890s to obtain rec- ognition and economic gains were picketing, strikes, and boycotts. Some employers responded with professional strikebreakers and blacklists. Employers also turned to the courts and sought and obtained injunctions against picketing, boycotts, and strike activities. The Vegelahn v. Guntner decision, including the dissenting opinion of Justice Oliver Wendell Holmes, then on the Massachusetts Supreme Judicial Court, is presented in this section. In Vegelahn, the union engaged in picketing in front of the employer’s business to try to persuade current employees and job appli- cants not to enter the business, and it sought to persuade individuals to break their employment contracts with the employer. The court enjoined this conduct.

With acceptance of the interference with contractual relations theory by the judiciary, employers often obtained a written pledge from each worker that in exchange for employment, the worker agreed not to join a union during the period of his or her employment. Such contracts were called yellow-dog contracts, with connotations of animal servitude as opposed to human dignity. In the Hitchman Coal & Coke v. Mitchell case decided in 1917, the Supreme Court upheld an injunction against a union, prohibiting it from interfering with the yellow-dog con- tracts in effect at two coal mines. The Hitchman precedent served as a model for other employers at that time to adopt similar contractual relations with their employees as a means of union avoidance.

Yellow-dog contracts were outlawed by Section 2(5) of the Railway Labor Act of 1926 and Section 3 of the Norris-LaGuardia Act of 1932.


ALLEN, J…. The principal question in this case is whether the defendants should be enjoined against maintaining the patrol. The report shows that, following upon a strike of the plaintiff’s workmen, the defendants con- spired to prevent him from getting workmen and thereby to prevent him from carrying on his business, unless and until he should adopt a certain schedule of prices. The means adopted were persuasion and social pressure, threats of personal injury or unlawful harm conveyed to persons employed or seeking employment, and a patrol of two men in front of the plaintiff’s factory, maintained from half past six in the morning till half past five in the afternoon, on one of the busiest streets of Boston. The number of men was greater at times, and at times showed some

little disposition to stop at the plaintiff’s door. The patrol proper at times went further than simple advice not obtruded beyond the point where the other person was willing to listen; and it was found that the patrol would probably be continued if not enjoined. There was also some evidence of persuasion to break existing contracts. The patrol was main- tained as one of the means of carrying out the defen- dant’s plan, and it was used in combination with social pressure, threats of personal injury or unlawful harm, and persuasion to break existing contracts. It was thus one means of intimidation, indirectly to the plaintiff, and directly to persons actually employed, or seeking to be employed, by the plaintiff, and of rendering such employment unpleasant and intolera- ble to such persons.



Such an act is an unlawful interference with the rights of both the employer and of the employed. An employer has a right to engage all persons who are willing to work for him, at such prices as may be mutually agreed upon, and persons employed or seek- ing employment have a corresponding right to enter into or remain in the employment of any person or corporation willing to employ them. These rights are secured by the [C]onstitution itself….

The defendants contend that these acts were justi- fiable because they were only seeking to secure better wages for themselves by compelling the plaintiff to accept their schedule of wages. This motive or pur- pose does not justify maintaining a patrol in front of the plaintiff’s premises, as a means of carrying out their conspiracy. A combination among persons merely to regulate their own conduct is within allow- able competition, and is lawful, although others may be indirectly affected thereby. But a combination to do injurious acts expressly directed to another, by way of intimidation or constraint, either of himself or of persons employed or seeking to be employed by him, is outside of allowable competition, and is unlawful…. We therefore think that the injunction should be in the form originally issued.

So ordered.

HOLMES, J. (dissenting) … One of the eternal conflicts out of which life is made up is that between the efforts of every man to get the most he can for his services, and that of society, disguised under the name of capital, to get his services for the least possible return. Combina- tion on the one side is patent and powerful. Combi- nation on the other is the necessary and desirable

counterpart, if the battle is to be carried on in a fair and equal way….

If it be true that workingmen may combine with a view, among other things, to getting as much as they can for their labor, just as capital may combine with a view to getting the greatest possible return, it must be true that, when combined, they have the same liberty that combined capital has, to support their interest by argument, persuasion, and the bestowal or refusal of those advantages which they otherwise lawfully con- trol. I can remember when many thought that, apart from violence or breach of contract, strikes were wicked, as organized refusals to work. I suppose that intelligent economists and legislators have given up that notion today. I feel pretty confident that they equally will abandon the idea that an organized refusal by workmen of social intercourse with a man who shall enter their antagonist’s employ is unlawful, if it is dis- associated from any threat of violence, and is made for the sole object of prevailing, if possible, in a contest with their employer about the rate of wages. The fact that the immediate object of the act by which the bene- fit to themselves is to be gained is to injure their antag- onist does not necessarily make it unlawful, any more than when a great house lowers the price of goods for the purpose and with the effect of driving a smaller antagonist from the business….

Case Questions

1. Was the picketing peaceful or tainted with violence?

2. What was the scope of the court’s injunction? 3. In his classic dissent, how does Justice Holmes jus-

tify the infliction of injury by a labor organization?


PITNEY, J…. This was a suit in equity, commenced October 24, 1907, in the United States Circuit (afterwards Dis- trict) Court for the Northern District of West Virgi- nia, by the Hitchman Coal & Coke Company, against certain officers of the United Mine Workers of America….

Plaintiff owns about 5,000 acres of coal lands sit- uated at or near Benwood, in Marshall county, West Virginia, and within what is known as the “Panhan- dle District” of that state, and operates a coal mine thereon employing between 200 and 300 men, and having an annual output, in and before 1907, of about 300,000 tons. At the time of filing of the bill,



and for a considerable time before and ever since, it operated its mine “nonunion,” under an agreement with its men to the effect that the mine should be run on a nonunion basis, that the employees should not become connected with the union while employed by plaintiff, and that if they joined it their employ- ment with plaintiff should cease….

… The general object of the bill was to obtain an injunction to restrain defendants from interfering with the relations existing between plaintiff and its employees in order to compel plaintiff to “unionize” the mine….

… On April 15, 1906, defendant Zelenka, vice- president of the subdistrict, visited the mine, called a meeting of the miners, and addressed them in a for- eign tongue, as a result of which they went on strike the next day, and the mine was shut down until the 12th of June, when it resumed as a “non- union” mine, so far as relations with the U.M.W.A. were concerned.

During this strike plaintiff was subjected to heavy losses and extraordinary expenses with respect to its business, of the same kind that had befallen it during the previous strikes.

About the 1st of June a self-appointed committee of employees called upon plaintiff’s president, stated in substance that they could not remain longer on strike because they were not receiving benefits from the union, and asked upon what terms they could return to work. They were told that they could come back, but not as members of the United Mine Workers of America; that thenceforward the mine would be run nonunion, and the company would deal with each man individually. They assented to this, and returned to work on a nonunion basis. Mr. Pickett, the mine superintendent, had charge of employing the men, then and afterwards, and to each one who applied for employment he explained the conditions which were that while the company paid the wages demanded by the union and as much as anybody else, the mine was run nonunion and would continue so to run; that the company would not recognize the United Mine Workers of America; that if any man wanted to become a member of that union he was at liberty to do so; but he could not be a member of it and remain in the employ of Hitchman Company; that if he worked for the company he would have to work as a nonunion man. To this each man employed gave his assent, understanding

that while he worked for the company he must keep out of the union.

Since January 1908 (after the commencement of the suit), in addition to having this verbal understanding, each man has been required to sign an employment card expressing in substance the same terms. This has neither enlarged nor diminished plaintiff’s rights, the agreement not being such as is required by law to be in writing. Under this arrangement as to the terms of employment, plaintiff operated its mine from June 2, 1906, until the commencement of the suit in the fall of the following year.

During the same period a precisely similar method of employment obtained, at the Glendale mine, a property consisting of about 200 acres of coal land adjoining the Hitchman property on the south, and operated by a company having the same stock- holders and the same management as the Hitchman mine; the office of the Glendale mine being at the Hitchman Coal & Coke Company’s office. Another mine in the Panhandle, known as Richland, a few miles north of the Hitchman, likewise was run “nonunion.”

In fact, all coal mines in the Panhandle and else- where in West Virginia, except in a small district known as the Kanawha field, were run “nonunion” while the entire industry in Ohio, Indiana, and Illinois was operated on the “closed shop” basis so that no man could hold a job about the mines unless he was a member of the United Mine Workers of America. Pennsylvania occupied a middle ground, only a part of it being under the jurisdiction of the union. Other states need not be particularly mentioned.

The unorganized condition of the mines in the Panhandle and some other districts was recognized as a serious interference with the purposes of the union in the Central Competitive Field, particularly as it tended to keep the cost of production low, and, through competition with coal produced in the orga- nized field, rendered it more difficult for the operators there to maintain prices high enough to induce them to grant certain concessions demanded by the Union….

What are the legal consequences of the facts that have been detailed?

That the plaintiff was acting within its lawful rights in employing its men only upon terms of con- tinuing nonmembership in the United Mine Workers of America is not open to question. Plaintiff’s



repeated costly experience of strikes and other inter- ferences while attempting to “run union” were a suf- ficient explanation of its resolve to run “nonunion,” if any were needed. But neither explanation nor justi- fication is needed. Whatever may be the advantages of “collective bargaining,” it is not bargaining at all, in any just sense, unless it is voluntary on both sides…. This court repeatedly has held that the employer is as free to make nonmembership in a union a condition of employment as the working man is free to join the union, and that this is part of the constitutional rights of personal liberty and pri- vate property, not to be taken away even by legisla- tion, unless through some proper exercise of the paramount police power….

Defendants set up, by way of justification or excuse, the right of workingmen to form unions, and to enlarge their membership by inviting other workingmen to join. The right is freely conceded, provided the objects of the union be proper and legit- imate, which we assume to be true, in a general sense, with respect to the union here in question. Gompers v. Bucks Stove & Range Co., 221 U.S. 418, 439. The cardinal error of defendants’ position lies in the assumption that the right is so absolute that it may be exercised under any circumstances and without any qualification; whereas in truth, like other rights that exist in civilized society, it must always be exer- cised with reasonable regard for the conflicting rights of others. Brennan v. United Hatters, 73 N.J. Law. 729, 749….

In any aspect of the matter, it cannot be said that defendants were pursuing their object by lawful means. The question of their intentions—of their bona fides—cannot be ignored. It enters into the question of malice. As Bowen, L. J. justly said, in the Mogul Steamship Case, 23 Q.B. Div. 613:

Intentionally to do that which is calculated in the ordinary course of events to damage, and which does, in fact, damage another in that other person’s property or trade, is actionable if done without just cause or excuse.

Another fundamental error in defendants’ position consists in the assumption that all measures that may be resorted to are lawful if they are “peaceable”—that

is, if they stop short of physical violence, or coercion through fear of it. In our opinion, any violation of plaintiff’s legal rights contrived by defendants for the purpose of inflicting damage, or having that as its nec- essary effect, is as plainly inhibited by the law as if it involved a breach of the peace. A combination to pro- cure concerted breaches of contract by plaintiff’s employees constitutes such a violation….

Upon all the facts, we are constrained to hold that the purpose entertained by defendants to bring about a strike at plaintiff’s mine in order to compel plaintiff, through fear of financial loss, to consent to the unionization of the mine as the lesser evil, was an unlawful purpose, and that the methods resorted to by Hughes—the inducing of employees to unite with the union in an effort to subvert the system of employment at the mine by concerted breaches of the contracts of employment known to be in force there, not to mention misrepresentation, deceptive statements, and threats of pecuniary loss communi- cated by Hughes to the men—were unlawful and malicious methods, and not to be justified as a fair exercise of the right to increase the membership of the union….

That the damage resulting from a strike would be irremediable at law is too plain for discussion.

As against the answering defendants, plaintiff’s right to an injunction is clear; as to the others named as defendants, but not served with process, the decree is erroneous, as already stated….

The decree of the Circuit Court of Appeals is reversed, and the degree of the District Court is mod- ified as above stated….

Case Questions

1. What agreement did the Hitchman Company ask its employees to abide by?

2. At the time of this case, what states were mining coal on a closed-shop basis?

3. What is a closed shop? 4. Were the organizing efforts of the UMWA

peaceful? Was this a good defense? 5. Did the Court concede that workers had the

right to form and join labor organizations? 6. Did the Court uphold the yellow-dog contract?



Labor organizations were on the defensive in the 1910s and 1920s. Not only were they subject to injunctions by the courts, but the courts also applied the antitrust laws to them. In the 1915 case of Lawlor v. Loewe, the Supreme Court ruled that a nationwide boycott by the hatters’ union against a nonunion hat manufacturer, Dietrich Loewe, violated the antitrust laws. The Court ruled that Loewe was enti- tled to collect treble damages from the 248 members of the union. The Court applied Section 1 of the Sherman Act to include agreements between laborers to extend control over a labor market. Section 1 of the Act provides in part: “Every contract, combination in the form of trust or otherwise, or conspiracy, in restraint of trade or commerce among the several states … is declared to be illegal.” Section 7 of the Sherman Act provided the statutory basis for the damages assessed against each of the union members.


HOLMES, J…. The substance of the charge is that the plaintiffs were hat manufacturers who employed nonunion labor; that the defendants were members of the United Hatters of North America and also of the American Federation of Labor; that in pursuance of a general scheme to unionize the labor employed by manufac- turers of fur hats (a purpose previously made effective against all but a few manufacturers), the defendants and other members of the United Hatters caused the American Federation of Labor to declare a boycott against the plaintiffs and against all hats sold by the plaintiffs to dealers in other States and against dealers who should deal in them; and that they carried out their plan with such success that they have restrained or destroyed the plaintiffs’ commerce with other States. The case now has been tried, the plaintiffs have got a verdict and the judgment of the District Court has been affirmed by the Circuit Court of Appeals. 209 F. 721, 126 C.C.A. 445.

The grounds for discussion under the statute have been narrowed by the case of Eastern States Retail Lumber Dealers’ Ass’n v. United States, 234 U.S. 600. Whatever may be the law otherwise, that case establishes that, irrespective of compulsion or even agreement to observe its intimation, the circulation of a list of “unfair dealers,” manifestly intended to put the ban upon those whose names appear therein,

among an important body of possible customers com- bined with a point of view to joint action and in anticipation of such reports, is within the prohibitions of the Sherman Act if it is intended to restrain and restrains commerce among the States.

It requires more than the blindness of justice not to see that many branches of the United Hatters and the Federation of Labor, to both of which the defendants belonged, in pursuance of a plan emanating from headquarters made use of such lists, and of the pri- mary and secondary boycott in their effort to subdue the plaintiffs to their demands. The union label was used and a strike of the plaintiffs’ employees was ordered and carried out to the same end, and the pur- pose to break up the plaintiffs’ commerce affected the quality of the acts. Loewe v. Lawlor, 208 U.S. 274, 299. We agree with the Circuit Court of Appeals that a combination and conspiracy forbidden by the stat- ute were proved, and that the question is narrowed to the responsibility of the defendants for what was done by the sanction and procurement of the societies above named.

The court in substance instructed the jury that if these members paid their dues and continued to dele- gate authority to their officers unlawfully to interfere with the plaintiffs’ interstate commerce in such cir- cumstances that they know or ought to have known, and such officers were warranted in the belief




Understanding labor-related statutory and case materials requires familiarity with the injunctive process. An injunction is a mandatory or prohibitory order issued by a court of equity. An injunction is prohibitory if it orders the defendant to refrain from specified conduct; it is mandatory if it requires performance of an affirmative act. An injunction gives relief to an aggrieved party in those cases where the remedy of monetary damages is inadequate. A single injunction may have prohibitory and mandatory aspects at the same time, as when a union is concurrently ordered to refrain from violence in picketing and to bargain in good faith with the employer.

A temporary restraining order may be issued prior to a hearing on an injunc- tion. It should be issued only in exceptional or urgent situations, its purpose being to maintain the status quo of the subject in dispute until a court hearing takes place. A temporary injunction, also called a preliminary injunction, is granted after a hearing (but before a full trial) and enjoins commission of the disputed acts while a court hears and studies the case on its merits. A final injunction is issued after a trial on the merits.

that they were acting in the matters within their dele- gated authority, then such members were jointly lia- ble, and no others. It seems to us that this instruction sufficiently guarded the defendants’ rights, and that the defendants got all that they were entitled to ask in not being held chargeable with knowledge as a matter of law. It is a tax on credulity to ask any one to believe that members of labor unions at that time did not know that the primary and secondary boycott and the use of the “We don’t patronize” or “Unfair” list were means expected to be employed in the effort to unionize shops. Very possibly they were thought to be lawful. See Gompers v. United States, 233 U.S. 604. By the Constitution of the United Hat- ters the directors are to use “all the means in their power” to bring shops “not under our jurisdiction” “into the trade.” The bylaws provide a separate fund to be kept for strikes, lockouts, and agitation for the union label. Members are forbidden to sell nonunion hats. The Federation of Labor with which the Hatters were affiliated had organization of labor for one of its objects, helped affiliated unions in trade disputes, and to that end, before the present trouble, had provided in its Constitution for prosecuting and had prose- cuted many what it called legal boycotts. Their con- duct in this and former cases was made public especially among the members in every possible way. If the words of the documents on their face and without explanation did not authorize what

was done, the evidence of what was done publicly and habitually showed their meaning and how they were interpreted. The jury could not but find that by the usage of the unions the acts complained of were authorized, and authorized without regard to their interference with commerce among the States. We think it unnecessary to repeat the evidence of the pub- licity of this particular struggle in the common news- papers and union prints, evidence that made it almost inconceivable that the defendants, all living in the neighborhood of the plaintiffs, did not know what was done in the specific case. If they did not know that, they were bound to know the constitution of their societies, and at least well might be found to have known how the words of those constitutions had been construed in the act….

Judgment affirmed.*

Case Questions

1. What purpose was pursued by the United Hatters?

2. What pressure methods did the American Fed- eration of Labor and the United Hatters exert?

3. State the rule of the case.

*By Section 301(b) of the National Labor Relations Act of 1947, money judgments are enforceable only against the union as an entity “and shall not be enforceable against any individual member or his assets.”



The earliest recorded issuance of a court injunction in a labor dispute dates from the 1880s. The case of In re Debs,13 decided in 1895, popularized the usage of the injunction in labor cases in America. One authority has found records in state and federal courts, from 1890 to 1931, of 1,872 labor injunctions granted at employ- ers’ requests and 223 cases in which such applications for relief were denied.14

Courts have authority to enforce injunctions with their contempt powers, including the assessment of fines or imprisonment. Direct contempts that occur in a court’s presence may be adjudged immediately and sanctioned summarily by the court. Except for serious criminal contempt, for which cases a jury is required, tra- ditional distinctions between civil and criminal contempt proceedings do not per- tain in direct contempt cases. A contempt fine assessed by a judge without a jury trial is considered “civil contempt” if it either coerces the defendant into compli- ance with a court’s order or compensates for losses sustained. However, contempt involving out-of-court disobedience of complex injunctions often requires elaborate and reliable factfinding and, under those circumstances, criminal procedural protec- tions, such as the right to counsel and proof beyond a reasonable doubt. These protections are necessary and appropriate to protect the due process rights of the parties and to prevent the arbitrary exercise of judicial power.

As applied to trespasses by labor, the employer found the injunction a keen and effective tool for the following reasons:

1. Speed of action was secured, becuase only affidavit proof (sworn statements in writing) had to be admitted for the court to issue a preliminary injunction, as opposed to the live testimony of witnesses under oath and subject to cross- examination.

2. Delay between issuance of the preliminary and the final injunction was often so prolonged as to ensure defeat of the strikers or picketers, notwithstanding the union’s eventual success in securing dissolution of the restraining order.

3. The employer had a choice of tribunal to which to direct the plea and could select an antilabor forum, either federal or state.

4. Lack of a jury trial in equity reduced labor’s chances of winning an injunc- tion case.

5. Blanket and obscure language in the wording of some injunctions intimidated union members because of their inability to separate legal from illegal acts, as well as their inability to determine exactly what conduct was permissible and what was forbidden.


In reaction to this situation, organized labor carried on a relentless lobbying effort in Congress to secure a narrowing of judicial injunctive power in labor cases. The first fruit of this campaign was the Clayton Antitrust Act of 1914. With this act

13 158 U.S. 164 (1895). 14 E. E. Witte, The Government in Labor Disputes (New York: McGraw-Hill, 1932), 64.


Congress sought to substantially reenact the Sherman Antitrust Act of 1890. At the same time, it sought to withdraw the applicability of the Act to labor combinations and to divest the courts of their wide injunctive powers in labor dispute cases. Sec- tion 6 provided “that the labor of a human being is not a commodity or article of commerce … nor shall such [labor] organizations, or the members thereof, be held or construed to be illegal combinations or conspiracies in restraint of trade, under the antitrust laws.”

Section 20 imposes a statutory restriction on injunctive relief by providing that no injunction would issue in a labor dispute between employers and employees unless irreparable injury to property and property rights was threatened for which the remedy at law (damages) was inadequate. Narrow Supreme Court interpreta- tions of the Clayton Act weakened the mandates of Sections 6 and 20, as set forth in the Duplex v. Deering15 and American Steel Foundries16 decisions of 1921. The courts found a path around the Act by making the exception the rule under various theories, among them that the act did not change preexisting law; did not apply where the union objective was recognition; did not apply where yellow-dog con- tracts were in effect; and finally, did not protect strikers because they were no lon- ger employees.

Use of injunctions against unions became even more popular after passage of the Clayton Act, because an employer could now bring an action in a federal court as a party plaintiff. Under the Sherman Act, only the government had that power.

THE NORRIS-LAGUARDIA ACT. Disappointed by the Supreme Court’s adverse construc- tion of the Clayton Act in the Duplex and American Steel Foundries cases, orga- nized labor intensified its political pressure at both state and federal levels, securing passage of the Federal Anti-Injunction Act (Norris-LaGuardia Act) in 1932. This legislation effectively divested the federal courts of their equity power to issue injunctions at the behest of private parties in situations in which a bona fide labor dispute existed. The jurisdictional requirements set forth in Section 7 of the Act furnished an almost insurmountable barrier to injunctive action when cou- pled with Section 13 of the Act, which very broadly defined the term labor dispute to include controversies without regard to whether the relation of employer and employee existed.

In Brady v. National Football League, presented in this chapter, professional football players sued the National Football League and its separately owned clubs, alleging that a planned lockout by the league would constitute a group boycott and price fixing in violation of Section 1 of the Sherman Antitrust Act. The federal dis- trict court in Minnesota granted a preliminary injunction enjoining the lockout. On appeal to the Court of Appeals for the Eighth Circuit, in a 2–1 decision, the court vacated the preliminary injunction because the case invoked or grew out of a “labor dispute,” and Section 4(a) of the Norris-La Guardia Act deprives federal courts of the power to issue an injunction prohibiting a party to a labor dispute from implementing a lockout of its employees.

15 254 U.S. 443 (1921). 16 257 U.S. 184 (1921).



[The Players opted to terminate their union’s status as their collective bargaining agent just before the collective bargaining agreement (CBA) expired on March 11, 2011. Later that day, the Players filed an action in district court alleging that the planned lock- out by the National Football League (NFL) would constitute a group boycott and price-fixing agreement that would violate Section 1 of the Sherman Antitrust Act. The individual Players explained that they had determined that it was not in their interest to remain unionized if the existence of such a union would serve to allow the NFL to impose anticompetitive restric- tions with impunity. The NFL proceeded with its planned lockout on March 12, 2011. The Players moved for a preliminary injunction in the district court, urging the court to enjoin the lockout as an unlawful group boycott that was causing irreparable harm to the Players. The district court granted a pre- liminary injunction, and the League appealed.]

Colloton, C. J. … We consider first the League’s contention that the Norris-LaGuardia Act deprived the district court of jurisdiction to enter the injunction. The NLGA, enacted in 1932, curtails the authority of a district court to issue injunctions in a labor dispute. “Congress was intent upon taking the federal courts out of the labor injunction business except in the very limited cir- cumstances left open for federal jurisdiction under the Norris-LaGuardia Act.” Marine Cooks & Stewards v. Pan. S.S. Co., 362 U.S. 365, 369 (1960).…

To determine whether the NLGA forbids or places conditions on the issuance of an injunction here, we begin with the text of the statute. Section 1 provides that “[n]o court of the United States … shall have jurisdiction to issue any … temporary or permanent injunction in a case involving or growing out of a labor dispute, except in strict conformity with the provisions of this chapter,” 29 U.S.C. § 101. As noted, the district court concluded that the Act is inapplicable to this action, because the case is not one “involving or growing out of a labor dispute.”

Section 13(c) of the Act states that “[t]he term ‘labor dispute’ includes any controversy concerning terms or conditions of employment, or concerning the association or representation of persons in

negotiating, fixing, maintaining, changing, or seeking to arrange terms or conditions of employment, regardless of whether or not the disputants stand in the proximate relation of employer and employee,” 29 U.S.C. § 113(c) (emphasis added). This lawsuit is a controversy concerning terms or conditions of employment. The Players seek broad relief that would affect the terms or conditions of employment for the entire industry of professional football. In par- ticular, they urge the court to declare unlawful and to enjoin several features of the relationship between the League and the players, including the limit on com- pensation that can be paid to rookies, the salary cap, the “franchise player” designation, and the “transi- tion player” designation, all of which the Players assert are anticompetitive restrictions that violate § 1 of the Sherman Act.…

… Not only has the Supreme Court repeatedly characterized § 13(c) as a definition, but contrary to the suggestion that an established meaning should be used to narrow the text, the Court has observed that “the statutory definition itself is extremely broad,” Jacksonville Bulk Terminals, Inc., 457 U.S. at 712, and explained that “Congress made the definition broad because it wanted it to be broad.” Order of R.R. Telegraphers, 362 U.S. at 335–36.

The Act also states expressly that “[a] case shall be held to involve or grow out of a labor dispute when the case involves persons who are engaged in the same industry, trade, craft, or occupation,” 29 U.S.C. § 113(a). This case, of course, involves persons engaged in the “same industry,” namely, professional football. The statute continues that such a case “shall be held to involve or grow out of a labor dispute”when “such dis- pute is…betweenone ormore employers or associations of employers and one or more employees or associations of employees,” Id. This dispute is between one or more employers or associations of employers (the League and the NFL teams) and one or more employees (the Players under contract). By the plain terms of the Act, this case “shall be held to involve or grow out of a labor dispute.”

The district court reached a contrary conclusion by departing from the text of § 13(a). The court thought the phrase “one or more employees or associations of employees” did not encompass the Players in this dispute, because “one or more



employees” means “individual unionized employee or employees.” … We see no warrant for adding a requirement of unionization to the text.…

The text of the Norris-LaGuardia Act and the cases interpreting the term “labor dispute” do not require the present existence of a union to establish a labor dispute. Whatever the precise limits of the phrase “involving or growing out of a labor dispute,” this case does not press the outer boundary. The Lea- gue and the players’ union were parties to a collective bargaining agreement for almost 18 years prior to March 2011. They were engaged in collective bar- gaining over terms and conditions of employment for approximately two years through March 11, 2011. At that point, the parties were involved in a classic “labor dispute” by the Players’ own definition. Then, on a single day, just hours before the CBA’s expiration, the union discontinued collective bargain- ing and disclaimed its status, and the Players filed this action seeking relief concerning industry-wide terms and conditions of employment. Whatever the effect of the union’s disclaimer on the League’s immunity from antitrust liability, the labor dispute did not sud- denly disappear just because the Players elected to pursue the dispute through antitrust litigation rather than collective bargaining.…

Aside from the text and structure of § 4, the Players argue that the policy of the NLGA and the legislative history support their position that § 4(a) offers no protection to employers. To be sure, the policy stated in § 2 is that the individual unorganized worker should be free from the interference, restraint, or coercion of employers in the designation of repre- sentatives, self-organization, or other concerted activ- ities. But it does not follow that a prohibition on injunctions against employer lockouts is contrary to the policy of the Act. The Supreme Court has observed that while the Act was designed to protect workingmen, the broader purpose was “to prevent the injunctions of the federal courts from upsetting the natural interplay of the competing economic forces of labor and capital.” Bhd. of R.R. Trainmen v. Chi. River & Ind. R.R. Co., 353 U.S. 30, 40 (1957) (emphasis added).…

For these reasons, we conclude that § 4(a) of the Norris-LaGuardia Act deprives a federal court of power to issue an injunction prohibiting a party to a labor dispute from implementing a lockout of its employees. This conclusion accords with the few deci-

sions that have addressed the specific question.… Because the Norris-LaGuardia Act prohibits the district court from issuing an injunction against the League’s lockout of employees, the court’s order cannot stand.…

Given our conclusion that the preliminary injunc- tion did not conform to the provisions of the Norris- LaGuardia Act, we need not reach the other points raised by the League on appeal. In particular, we express no view on whether the League’s nonstatu- tory labor exemption from the antitrust laws con- tinues after the union’s disclaimer. The parties agree that the Act’s restrictions on equitable relief are not necessarily coextensive with the substantive rules of antitrust law, and we reach our decision on that understanding.…

BYE, Circuit Judge, dissenting In 1914, after 20 years of judicial interference in labor conflicts on the side of the employers, Congress stepped in to protect organized labor by passing sec- tions 6 and 20 of the Clayton Act. Section 20 of the Act generally prohibited the issuance of injunctions in cases involving or growing out of labor disputes. See 29 U.S.C. § 52. It soon became apparent, however, that what was supposed to be the “charter of liberty of labor,” Felix Frankfurter & Nathan Greene, The Labor Injunction 164 (1930) (remarks of William Howard Taft), fell short of the promise. The Lochner- era judges adopted a narrow interpretation of the Act, restricting it to “trade union activities directed against an employer by his own employees.” United States v. Hutcheson, 312 U.S. 219, 230 (1941). “[T]o protect the rights of labor in the same manner the Congress intended when it enacted the Clayton Act,” id. at 236, Congress passed the Norris-LaGuardia Act, under which “the allowable area of union activity was not to be restricted … to an immediate employer-employee relation,” Id. at 231. Through its holding in this case today, the majority reaffirms the wisdom of the old French saying used by Felix Frank- furter and Nathan Greene when describing judicial reluctance to enforce § 20 of the Clayton Act: “the more things are legislatively changed, the more they remain the same judicially.” Felix Frankfurter & Nathan Greene, The Labor Injunction 176 (1930). Despite the repeated efforts of the legislative branch to come to the rescue of organized labor, today’s opinion puts the power of the Act in the service of employers, to be used against non-unionized employees who can



CONGRESSIONAL ADJUSTMENTS. With the enactment of the Labor Management Rela- tions Act of 1947 (Taft-Hartley Act) and the Labor-Management Reporting and Disclosure Act of 1959 (Landrum-Griffin Act) reflecting a public policy change, immunities from injunctive action afforded labor by the Anti-Injunction Act were substantially narrowed. Section 10(1) of the National Labor Relations Act allows the National Labor Relations Board to seek appropriate injunctive relief against unions in certain matters such as secondary boycotts and jurisdictional disputes.


The Labor Management Relations Act of 1947 embodies the congressional policy favoring bargaining as the best means of resolving disputes between employers and employees, thereby preserving economic stability and industrial peace. Labor law allows employees to form unions, which then act as the employees’ exclusive bargaining representative. Unions and employers have a duty to bargain in good faith toward mutually acceptable agreements that cover wages, hours, and working conditions. Federal labor law also allows employers to band together with other employers in the same industry to form multi-employer bargaining units. Labor law, then, in facilitating the setting of the prices that groups of employers will pay for labor, would appear to be in conflict with the national antitrust policy favoring unrestricted economic competition and precluding the fixing of prices. To avoid this potential conflict, the Supreme Court has recognized a nonstatutory labor exemption that immunizes certain results of that bargaining process from antitrust attack. This nonstatutory exemption protects union-employer collective bargaining agreements dealing with wages, hours, and working conditions from being subject to antitrust law.

The nonstatutory exemption does not, however, exempt all agreements between unions and employers. In United Mine Workers v. Pennington,17 the Supreme Court made clear that unions continue to remain subject to federal antitrust laws to the extent that a union joins with an employer group to eliminate other employers from the industry and to the extent that a union agrees with one set of employers to impose specified wage scales on other employer bargaining units.

no longer avail themselves of protections of labor laws. Because I cannot countenance such interpretation of the Act, I must and hereby dissent.…

Case Questions

1. Must there be a duly certified union in order to have a “labor dispute” under the Norris- LaGuardia Act?

2. Did the “labor dispute” between the players and the League disappear when the players decerti- fied as a union and elected to pursue the dispute through antitrust litigation rather than collective bargaining?

3. Did the court decide that the League’s nonstatu- tory labor exemption from the antitrust laws continues even though the players decertified as a union?

17 381 U.S. 657 (1965).


In Brown v. Pro Football, Inc., presented in this section, the Supreme Court recognized that the nonstatutory labor exemption can be applied where needed to make the collective bargaining process work. And it applied the exemption to shield football team owners from an antitrust attack for agreeing together as a multi- employer bargaining group to impose a set weekly salary figure of $1,000 per week on its 235 developmental squad professional football players after the employer group could not reach agreement on this issue with the players union. If there was no existing bargaining relationship with a union, the employers would not be able to collectively set the rates they would pay for the developmental squad members, and a clear antitrust violation would have existed. Many agents of professional players would prefer that the football players union be decertified in order to destroy the nonstatutory exemption and bring about full free agency for players.

In the Brady v. National Football League decision, previously presented, the Eighth Circuit was very careful to point out that it did not address the question of whether the League’s nonstatutory labor exemption from the antitrust laws contin- ued once the players decertified their union.


[After their collective bargaining agreement expired, the National Football League (NFL) and the NFL Players Association, a labor union, began to negotiate a new contract. The NFL presented a plan that would permit each club to establish a “developmental squad” of substitute players, each of whom would be paid the same $1,000 weekly salary. The union disagreed, insisting that the 235 individual develop- mental squad members should be free to negotiate their own salaries. When negotiations reached an impasse in June 1989, the NFL unilaterally imple- mented the plan. Anthony Brown of the Washington Redskins filed a class action antitrust suit, claiming that the employers’ agreement to pay them $1,000 per week restrained trade in violation of the Sherman Act. A jury granted an award of $10 million to the class, which was trebled by the district court to a $30 million judgment for the players. The court of appeals reversed, holding that the owners were immune from antitrust liability under the federal labor laws. The matter was appealed to the Supreme Court.]

BREYER, J…. Labor law itself regulates directly, and considerably, the kind of behavior here at issue—the postimpasse imposition of a proposed employment term concern- ing a mandatory subject of bargaining. Both the Board and the courts have held that, after impasse,

labor law permits employers unilaterally to imple- ment changes in preexisting conditions, but only inso- far as the new terms meet carefully circumscribed conditions. For example, the new terms must be “rea- sonably comprehended” within the employer’s preim- passe proposals (typically the last rejected proposals), lest by imposing more or less favorable terms, the employer unfairly undermined the union’s status…. The collective-bargaining proceeding itself must be free of any unfair labor practice, such as an employ- er’s failure to have bargained in good faith. See Akron Novelty Mfg. Co., 224 N.L.R.B. 998, 1002 (1976) (where employer has not bargained in good faith, it may not implement a term of employment); P. Hardin, The Developing Labor Law 697 (3rd ed. 1992) (same). These regulations reflect the fact that impasse and an accompanying implementation of proposals constitute an integral part of the bargaining process….

In these circumstances, to subject the practice to antitrust law is to require antitrust courts to answer a host of important practical questions about how collective bargaining over wages, hours and working conditions is to proceed—the very result that the implicit labor exemption seeks to avoid. And it is to place in jeopardy some of the potentially beneficial labor-related effects that multiemployer bargaining can achieve. That is because unlike labor law,




1. What three early common law doctrines were applied to labor organizations?

2. What is the present status of the so-called yellow-dog contract?

3. May the National Labor Relations Board obtain injunctive relief against unions in light of the Federal Anti-Injunction Act?

4. The National Electrical Contractors’ Associ- ation (NECA) is a national trade association composed of electrical contractors. NECA negotiates a nationwide collective bargaining agreement with the International Brother- hood of Electrical Workers (IBEW). The electrical contractors who belong to NECA

which sometimes welcomes anti-competitive agree- ments conducive to industrial harmony, antitrust law forbids all agreements among competitors (such as competing employers) that unreasonably lessen competition among or between them in virtually any respect whatsoever….

If the antitrust laws apply, what are employers to do once impasse is reached? If all impose terms similar to their last joint offer, they invite an antitrust action premised upon identical behavior (along with prior or accompanying conversations) as tending to show a common understanding or agreement. If any, or all, of them individually impose terms that differ signifi- cantly from that offer, they invite an unfair labor prac- tice charge. Indeed, how can employers safely discuss their offers together even before a bargaining impasse occurs? A preimpasse discussion about, say, the prac- tical advantages or disadvantages of a particular pro- posal, invites a later antitrust claim that they agreed to limit the kinds of action each would later take should an impasse occur…. All this is to say that to permit antitrust liability here threatens to introduce instability and uncertainty into the collective-bargaining process, for antitrust law often forbids or discourages the kinds of joint discussions and behavior that the collective- bargaining process invites or requires…. The judgment of the Court of Appeals is affirmed.

It is so ordered.

JUSTICE STEVENS, dissenting… In his classic dissent in Lochner v. New York, 198 U.S. 45, 75 (1905), Justice Holmes reminded us that our disagreement with the economic theory embod- ied in legislation should not affect our judgment about its constitutionality. It is equally important, of course, to be faithful to the economic theory underlying broad statutory mandates when we are construing their impact on areas of the economy not specifically addressed by their texts. The unique

features of this case lead me to conclude that the Court has reached a decision that conflicts with the basic purpose of both the antitrust laws and the national labor policy expressed in a series of con- gressional enactments….

Congress is free to act to exempt the anticompeti- tive employer conduct that we review today. In the absence of such action, I do not believe it is for us to stretch the limited exemption that we have fash- ioned to facilitate the express statutory exemption created for labor’s benefit so that unions must strike in order to restore a prior practice of individually negotiating salaries. I therefore agree with the posi- tion that the District Court adopted below.

Because the developmental squad salary provi- sions were a new concept and not a change in terms of the expired collective bargaining agreement, the policy behind continuing the non-statutory labor exemption for the terms of a collective bargaining agreement after expiration (to foster an atmosphere conducive to the negotiation of a new collective bar- gaining agreement) does not apply. To hold that the non-statutory labor exemption extends to shield the NFL from antitrust liability for imposing restraints never before agreed to by the union would … infringe on the union’s freedom to contract….

Case Questions

1. Identify the “non-statutory labor exemption” and explain its significance.

2. Did the non-statutory labor exemption from the antitrust laws expire upon the parties reaching bargaining impasse?

3. If the NFL Players Association decertifies, may NFL players bring suit against NFL owners for antitrust violations for the league’s salary cap and employer-imposed uniform salary rates for developmental squad players?


pay annual dues and a service charge in exchange for the benefits of being an NECA member. One such benefit is the single NECA labor agreement that covers the IBEW members employed by the electrical contractors. Approximately 50 percent of the electrical work in the United States is performed by NECA member companies, with the remainder being performed by non- NECA contractors who negotiate separately with the IBEW, employ members of other unions, or are nonunion.

NECA member companies realized that non-NECA companies had a competitive advantage over NECA contractors when they bid for jobs because they did not have to recover the cost of NECA membership in their quoted price. Therefore, IBEW and NECA placed a provision in their national agreement requiring that in any job involving a party to the agreement, the employer would pay one percent of its gross labor payroll into the National Electrical Industry Fund to be jointly administered by NECA and IBEW. Because the agreement was binding on all IBEW locals, its effect was to force non-NECA contractors employing IBEW members to pay into the fund.

Non-NECA contractors brought an action claiming that the industry fund pro- vision constituted price fixing by NECA and IBEW, an antitrust violation under the Sherman Act. They requested an injunction against IBEW and NECA’s agreement. IBEW and NECA argued that no injunction could be issued.

May an injunction be issued by a court against the NECA-IBEW agreement? If so, should an injunction issue in this case? Decide. [NECA, Inc. v. National Contractors’ Association, 110 LRRM 2385 (4th Cir.)]

5. United Mine Workers of America, District 28, engaged in a protracted labor dispute with the Clinchfield Coal Co. and Sea “B” Mining Co. over alleged unfair labor prac- tices. In April 1989, the companies filed suit

in Virginia to enjoin the union from con- ducting unlawful strike-related activities. The trial court entered an injunction that prohibited the union and its members from, among other things, obstructing ingress and egress to company facilities, throwing objects at and physically threatening com- pany employees, placing tire-damaging “jackrocks” on roads used by company vehicles, and picketing with more than a specified number of people at designated sites. The court additionally ordered the union to take all steps necessary to ensure compliance with the injunction, to place supervisors at picket sites, and to report all violations to the court.

On May 16, 1989, the trial court held a contempt hearing and found that the union had committed 72 violations of the injunc- tion. After fining the union $642,000 for its disobedience, the court announced that it would fine the union $100,000 for any future violent breach of the injunction and $20,000 for any future nonviolent infraction.

In seven subsequent contempt hearings held between June and December 1989, the court found the union in contempt for more than 400 separate violations of the injunction, many of them violent. Each contempt hearing was conducted as a civil proceeding before the trial judge, in which the parties conducted discovery, introduced evidence, and called and cross-examined witnesses. The trial court required that contumacious acts be proved beyond a reasonable doubt, but did not afford the union a right to jury trial.

The court levied $52 million in fines against the unions and directed that the money be paid to the state and two of its counties. The union contends that the fines were criminal and could not be imposed absent a criminal trial. The state contends that the fine schedule was intended to coerce compliance with the injunction and therefore the fines were civil and properly


imposed in civil proceedings. Decide. [United Mine Workers of America v. Bagwell, 114 S. Ct. 2552]

6. When the Strand Theatre of Shreveport Corporation’s collective bargaining agree- ment with its union expired, the theatre refused to bargain with the union over a new contract. Under basic contract law, when a contract expires, the parties are free to make or not make a new contract; a new contract is not made unless there is assent to all terms by both parties. Was the theatre within its legal rights in choosing not to bargain with the union after the expiration of the collec- tive bargaining agreement? Decide. [NLRB v. Strand Theatre of Shreveport Corp., 493 F.3d 515 (5th Cir. 2007)]

7. On October 2, 2007, a federal district court jury awarded Anucha Browne Sanders, the former senior vice president of the New York Knicks basketball team, $11.6 million in punitive damages against the team’s owner, Madison Square Garden; its chair- man, James Dolan; and its president and head coach, Isiah Thomas. Browne Sanders was seeking an additional $9.6 million in compensatory damages at a subsequent trial stage. On December 10, 2007, the parties settled for what news media reported to be $11.5 million.

Ms. Browne Sanders said:

The jury’s verdict in this case sent a powerful and enduring message that harassment and retaliation at Madison Square Garden will not be tolerated. It is my hope that all women will be able to work in an environ- ment that is free of discrimination and harassment, and that any woman who stands up for her rights will be taken seriously by her employer rather than retaliated against.

Madison Square Garden officials stated that they “vehemently disagree with the jury’s decision,” but settled the matter under pres- sure from NBA Commissioner Stern. Isiah Thomas stated that he was “completely innocent.” Google Browne Sanders-Isiah Thomas sexual harassment trial and read the reported testimony and commentary. Do you believe that “the law” against sexual harass- ment in the workplace and retaliation against the victim reporting misconduct is compli- cated? Did the notoriety of this case have a “teaching effect” on all employers that harassment and retaliation should not be tolerated because it is harmful to victims and costly to the employers who allow such mis- conduct to exist? [“Post-Verdict Settlement Reached Former Knicks Executive’s Case,” DLR No. 238, A-12 (Dec. 12, 2007)]


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2:1 Introduction

2:2 Open Operations of Administrative Agencies

2:3 Agency “Regulations” as Law

2:4 The Adjudicatory Function

2:5 Exhaustion of Administrative Remedies

2:6 Court Review of Agency Findings of Fact

2:7 Court Review of Agency Determinations on Law and Policy: The Chevron Framework

2:8 The Federal Court System


A federal administrative agency is a government body charged with implementing and “administrating” legislation enacted by Congress. Administrative agencies commonly have broad rulemaking, enforcement, and adjudicatory powers. Federal administrative agencies dealing with labor and employment law issues include the National Mediation Board (NMB), the National Labor Relations Board (NLRB), the Equal Employment Opportunity Commission (EEOC), and numerous agencies within the U.S. Department of Labor (DOL). The structure and functions of each agency are governed by the statute or statutes it administers. Radical structural differences exist between agencies. For example, members of the EEOC do not “decide” individual cases under an administrative law system similar to the


adjudicative procedures of the National Labor Relations Act (NLRA). The Occupational Safety & Health Administration (OSHA) has the authority under its organic statute, the Occupational Safety and Health Act, to promulgate standards, conduct inspections, and seek enforcement for noncompliance with OSHA regula- tions. An independent agency, the Occupational Safety and Health Review Com- mission, adjudicates contested enforcement actions undertaken by OSHA, but has limited non-policymaking adjudicatory powers. In contrast, the NLRB uses an adjudicatory model as opposed to rulemaking and makes policy decisions on a case-by-case basis. This short introductory chapter presents an overview of basic administrative law principles, discusses the standards for court review of agency determinations on law and policy, and identifies the federal courts available for the review of legal issues resulting from administrative agency action or inaction. Discussion of administrative procedures under specific federal labor and employ- ment laws will be more fully presented in the chapters dealing with the law(s) in question.


The public has ready access to the activities of administrative agencies. That access comes in three ways: (1) open records, (2) open meetings, and (3) public announcement of agency guidelines. The actions and activities of most federal agencies that are not otherwise regulated are controlled by the Administrative Procedure Act.1

The Freedom of Information Act2 (FOIA) provides that information con- tained in records of federal administrative agencies be available to citizens upon proper request. The primary purpose of this statute is “to ensure that govern- ment activities be opened to the sharp eye of public scrutiny.”3 To ensure that members of the public understand how to obtain records, the FOIA provides that “[e]ach agency shall … publish in the Federal Register for the guidance of the public … the methods whereby the public may obtain information, make sub- mittals or requests, or obtain decisions.”4 There are exceptions to this right of public scrutiny. They prevent individuals and companies from obtaining informa- tion that is not necessary to their legitimate interests and might harm the person or company whose information is being sought.5 FOIA exemptions include com- mercial and financial information not ordinarily made public by the person or company that supplies the information to the agency as part of the agency’s enforcement role.6

1 Administrative Procedure Act, 5 U.S.C. § 550 et seq. 2 U.S.C. § 552 et seq. The Electronic Freedom of Information Act Amendments of 1996 extend the public availability of information to electronically stored data. 3 Brady-Lunny v. Massey, 185 F. Supp. 2d 928 (C.D. Ill. 2002). 4 5 U.S.C. § 552(a)(1)(a). 5 Additional protection is provided by the Privacy Act of 1974, 5 U.S.C. § 552a(b); Doe v. U.S. Dept. of Treasury, 2009 WL 1949119 (D.D.C. 2009). 6 Sun-Sentinel Co. v. U.S. Dept. of Homeland Security, 431 F. Supp. 2d 1258 (S.D. Fla. 2006).



An agency may adopt regulations—the rulemaking function—within the scope of its authority. The power of an agency to carry out a congressional program “neces- sarily requires the formulation of policy and the making of rules to fill any gap left by Congress.”7 If the regulation is not authorized by the law creating the agency, anyone affected by it can challenge the regulation on the basis that the agency has exceeded its authority. However, when the agency establishes a rational basis for its rule, courts accept the rule and do not substitute their own judgment for the agency’s rule.8 The rulemaking steps follow.

1. Congressional Enabling Act: Before an agency can begin rulemaking proceed- ings, it must be given jurisdiction by congressional enactment in the form of a statute. For example, Congress has enacted broad statutes governing discrimination in employment practices and has given authority to the EEOC to establish definitions, rules, and guidelines for compliance with those laws. Sometimes an existing agency is assigned the responsibility for implementation and enforcement of new legislation. For example, the U.S. Department of Labor has been assigned the responsibility to handle the whistleblower protec- tion provisions of the Sarbanes-Oxley Act that provide protection against retaliation and/or termination to those who report financial improprieties at their companies. The U.S. Department of Labor has been in existence for almost a century, but it was assigned this new responsibility because of its expertise in handling other whistleblower statutes.

2. Agency Research of the Problem: After jurisdiction is established, the agency has the responsibility to research the issues and various avenues of regulation for implementing the statutory framework. As the agency does so, it deter- mines the costs and benefits of the problems, issues, and solutions. The study may be done by the agency, or the study may be completed by someone hired by the agency.

3. Proposed Regulations: Following the study, the agency proposes regulations that must be published. To provide publicity for all regulations, the Federal Register Act9 provides that proposed administrative regulations be published in the Federal Register. This government publication, published five days a week, lists all administrative regulations, all presidential proclamations and executive orders, and other documents and classes of documents that the president and Congress direct to be published.

4. Public Comment Period: Following publication of the proposed rules, the public has the opportunity to provide input on them. Called the public comment period, this time must last at least 30 days (with certain emergency exceptions) and may consist simply of letters written by those affected that are filed with the agency or of hearings conducted by the agency in Washington, D.C., or at specified locations around the country.

7 Virginia v. Browner, 80 F.3d 869 (4th Cir. 1996). 8 Covad Communications Co. v. FCC, 430 F.3d 528 (D.C. Cir. 2006). 9 44 U.S.C. § 1505 et seq.


5. Options after Public Comment: After receiving the public input on the proposed rule, an agency can decide to promulgate the rule. The agency can also decide to withdraw the rule. For example, the EEOC had proposed rules on handling religious discrimination in the workplace. The proposed rules that would have required employers to police those workers wearing a cross or another religious symbol met with so much public and employer protest that they were withdrawn. The agency can decide to modify the rule based on comments and then promulgate it, or, if the modifications are extensive or material, modify and put the proposed rule back out for further public comment.


Although most federal administrative agencies “change” policy matters pursuant to the notice-and-comment procedures of the Administrative Procedure Act, the NLRB has chosen to make policy changes on a case-by-case basis.10 This “adjudication” method of policy making, as is the custom of the Labor Board, utilizes a factual record developed before an administrative law judge (ALJ), the ALJ’s recommended decision, and the proceedings before the Board members. The Board and the labor relations community are often able to identify novel cases, or cases ripe for policy reconsideration, and interested unions and employer-aligned groups that are not par- ties to the case are allowed to file amicus briefs for consideration by the Board.11

The steps of the administrative adjudicatory functions of the NLRB are presented in detail in Chapter 4.


All parties interacting with an agency must follow the procedures specified by the law. No appeal to a court is possible until the agency has acted on the party’s mat- ter before it. As a matter of policy, parties are required to exhaust administrative remedies before they may go to court or take an appeal.

Exceptions to the exhaustion-of-administrative-remedies requirement are that (1) available remedies provide no genuine opportunity for adequate relief, (2) irrep- arable injury may occur if immediate judicial relief is not provided, (3) an appeal to the administrative agency would be futile, or (4) a substantial constitutional ques- tion has been raised.

10 The NLRB nevertheless has broad rulemaking power under Section 6 of the NLRA, 29 U.S.C. § 156 (2000). 11 In the NLRB’s IBM Corp. decision, 174 L.R.R.M 1537 (BNA 2004), which changed Board policy and ruled that nonunion employees do not have the right to have a coworker present during an inves- tigatory interview, the Board granted the joint request of LPA, Inc., the Equal Employment Advisory Council, Associated Builders and Contractors, the Chamber of Commerce of the United States, the Society for Human Resource Management, the International Mass Retail Association, and the National Association of Manufacturers to file an amicus brief on behalf of the employer. The AFL-CIO did not file a brief in this case.



Appellate challenges in U.S. courts of appeals to agency final orders often are focused on the agency’s findings of fact on which its conclusions of law are based. The Admin- istrative Procedure Act directs that the reviewing court should set aside agency action “unsupported by substantial evidence.” Regarding determinations of fact by the NLRB, which will be discussed in detail in Chapter 4, Section 10(e) of the Taft-Hartley Act states that “[t]he findings of the Board with respect to questions of fact if supported by substantial evidence on the record considered as a whole shall be conclusive.”


The Supreme Court set forth the role of the federal judiciary in reviewing an administrative agency’s application of its organic statute in Chevron U.S.A. v. Natural Resources Defense Council, Inc.12 The Chevron Court designed a two-step analytical framework for the reviewing court on matters of law and policy. First, the court must ask whether Congress has spoken directly on the question at issue. If so, the reviewing court and the agency must give effect to this congressional intent as expressed in the statute. Second, if the statute is silent or ambiguous on the question at issue, the review- ing court must then ask whether the agency’s interpretation is “based on a permissible construction of the statute.”13 The power of an agency to administer a congressionally created program necessarily requires the formulation of policy to fill gaps left implicitly or explicitly by Congress. If it is a reasonable policy choice, the agency’s construction of the statute is controlling, even if the reviewing court would have chosen a different interpretation. The agency’s interpretation is to be given “controlling weight unless [it is] arbitrary, capricious or manifestly contrary to statute.”14

A reviewing court may, under the first Chevron step, conclude that the issue is one of law rather than one of delegated policy and reject the agency’s decision or rule.

Under its second step, the Chevron Court noted that for “judicial purposes” in reconciling conflicting policies, the administrator’s interpretation is entitled to def- erence as opposed to the reviewing judges, who are not experts in the field.15 The Court stated in part:

[A]n agency to which Congress has delegated policymaking responsibilities may, within the limits of that delegation, properly rely upon the incumbent administration’s views of wise policy to inform its judgments. While agencies are not directly accountable to the people, the Chief Executive is, and it is entirely appropriate for this political branch of Govern- ment to make such policy choices—resolving the competing interests which Congress itself either inadvertently did not resolve, or intentionally left to be resolved by the agency charged with the administration of the statute in light of everyday realities.16

12 467 U.S. 837 (1984). 13 Id. at 843. 14 Id. at 844. 15 Chevron, 467 U.S. at 865. 16 Id. at 865, 866. See also NLRB v. Curtain Matheson Scientific, 494 U.S. 775, 786 (1990).


In the Mayo Foundation for Medical Education decision set forth in this sec- tion, the Supreme Court applied the Chevron framework in upholding the Treasury Department’s rule that medical interns scheduled to work 40 or more hours a week are not students exempt from FICA taxes.

In addition to the general principles of administrative law discussed in the landmark Chevron decision, the Supreme Court has specifically emphasized that the NLRB has the primary responsibility for developing and applying national labor policy.17 The Court has stated that it will uphold a Board rule as long as it is rational and consistent with the Act.18 And the Court has stated that a Board rule is entitled to deference even if it represents a departure from the Board’s prior policy.19

17 Fall River Dyeing & Finishing Corp. v. NLRB, 482 U.S. 27, 42 (1987). 18 NLRB v. J. Weingarten, Inc., 420 U.S. 251, 265–266 (1975). 19 Id.


[The Mayo Clinic offers residency programs to doctors who have graduated from medical school and seek additional instruction in a chosen specialty. Those pro- grams train doctors primarily through hands-on expe- rience. Although residents are required to take part in formal educational activities, these doctors generally spend the bulk of their time—typically 50 to 80 hours a week—caring for patients. Mayo pays its residents annual “stipends” of over $40,000 and also provides them with health insurance, malpractice insurance, and paid vacation time.

The Federal Insurance Contributions Act (FICA) requires employees and employers to pay taxes on all “wages” employees receive, and defines “wages” to include “all remuneration for employment.” FICA defines “employment” as “any service … performed … by an employee for the person employing him,” but excludes from taxation any “service performed in the employ of … a school, college, or university … if such service is performed by a student who is enrolled and regularly attending classes at [the school],” §3121(b)(10). Since 1951, the Treasury Department has construed the student exception to exempt from tax- ation students who work for their schools “as an incident to and for the purpose of pursuing a course of study.” In 2004, the Department issued regulations providing that “[t]he services of a full-time employee”—which includes an employee normally scheduled to work 40 hours

or more per week—“are not incident to and for the purpose of pursuing a course of study,” 26 CFR §31.3121(b)(10)-2(d)(3)(iii). The Department explained that this analysis “is not affected by the fact that the services … may have an educational, instructional, or training aspect,” Ibid. The rule offers as an example a medical resident whose normal schedule requires him to perform service 40 or more hours per week, and con- cludes that the resident is not a student. Mayo filed suit asserting that this rule was invalid, and the District Court agreed. The Eighth Circuit reversed. The Supreme Court granted certiorari.]

ROBERTS, C.J. … [R]egulation, like legislation, often requires drawing lines. Mayo does not dispute that the Treasury Department reasonably sought a way to distinguish between workers who study and students who work.… Focusing on the hours an individual works and the hours he spends in studies is a perfectly sensi- ble way of accomplishing that goal. The Department explained that an individual’s service and his “course of study are separate and distinct activities” in “the vast majority of cases,” and reasoned that “[e]mployees who are working enough hours to be considered full- time employees … have filled the conventional measure of available time with work, and not study,” 69 Fed. Reg. 8607. The Department thus did not distinguish




A selective outline of the federal court system is helpful in understanding the travel of labor and employment law cases from administrative agencies to review or trial in an appropriate federal court.


The district courts of the United States, commonly referred to as federal district courts, are the general trial courts of the federal court system. They are courts of original jurisdiction that hear both civil and criminal matters. Civil cases that can be brought in federal district courts include (1) civil suits in which the United States

classroom education from clinical training but rather education from service. The Department reasonably concluded that its full-time employee rule would “improve administrability,” id., at 76405, and it thereby “has avoided the wasteful litigation and con- tinuing uncertainty that would inevitably accompany any purely case-by-case approach” like the one Mayo advocates, United States v. Correll, 389 U.S. 299, 302 (1967).

As the Treasury Department has explained, moreover, the full-time employee rule has more to recommend it than administrative convenience. The Department reasonably determined that taxing resi- dents under FICA would further the purpose of the Social Security Act (SSA) and comport with this Court’s precedent. As the Treasury Department appreciated, this Court has understood the terms of the Social Security Act to “‘import a breadth of cov- erage,’” 69 Fed. Reg. 8605 (quoting Social Security Bd. v. Nierotko, 327 U.S. 358, 365 (1946), and we have instructed that “exemptions from taxation are to be construed narrowly,” Bingler v. Johnson, 394 U.S. 741, 752 (1969). Although Mayo contends that medical residents have not yet begun their “working lives” because they are not “fully trained,” Reply Brief for Petitioners 13 (internal quotation marks omitted), the Department certainly did not act irratio- nally in concluding that these doctors—“who work long hours, serve as highly skilled professionals, and typically share some or all of the terms of employ- ment of career employees”—are the kind of workers that Congress intended to both contribute to and benefit from the Social Security system, 69 Fed. Reg. 8608.

The Department’s rule takes into account the SSA’s concern that exempting residents from FICA would deprive residents and their families of vital dis- ability and survivorship benefits that Social Security provides, Id., at 8605. Mayo wonders whether the full-time employee rule will result in residents being taxed under FICA but denied coverage by the SSA. The Government informs us, however, that the SSA continues to adhere to its longstanding position that medical residents are not students and thus remain eligible for coverage. Brief for United States 29–30; Tr. of Oral Arg. 33–34.

*** We do not doubt that Mayo’s residents are

engaged in a valuable educational pursuit or that they are students of their craft. The question whether they are “students” for purposes of §3121, however, is a different matter. Because it is one to which Congress has not directly spoken, and because the Treasury Department’s rule is a reasonable construction of what Congress has said, the judgment of the Court of Appeals must be affirmed.

It is so ordered.

Case Questions

1. Utilizing the Chevron framework, how did the Court respond to the first question of whether Congress has “directly addressed the precise question at issue”?

2. Did the Court find that the Treasury Depart- ment’s interpretation is “based on a permissible construction of the statute” under Chevron’s second step?


is a party, (2) cases between citizens of different states that involve damages of $75,000 or more, and (3) cases that arise under the U.S. Constitution or federal laws and treaties. Federal district courts are located in each of the states and territories of the United States.

Regarding labor laws, regional directors of the NLRB must ask a U.S. district court for a temporary restraining order in unlawful secondary boycott and strike cases under Section 10(k) of the NLRA. Regional directors may petition a U.S. district court for appropriate temporary injunctive relief or a restraining order in unfair labor practice proceedings which relief stays in effect until the Board makes the final disposition of the case. Section 301 of the Taft-Hartley Act grants federal district courts jurisdiction to resolve suits for violation of collective bargaining contracts, and Section 303 allows employers to sue unions for damages from secondary boycotts. A wide variety of motions involving labor-related laws are also heard before federal district courts.

Cases are litigated by the parties themselves in the federal district courts after the procedures of the EEOC have been completed without a settlement and the agency has issued a right-to-sue letter. In unusual situations, the EEOC itself may litigate “pattern-or-practice” and precedent-establishing systemic cases.

INITIAL STEPS IN A LAWSUIT. It is helpful to know certain litigation steps and terms to better understand the court decisions presented in this book.

A lawsuit begins with the filing of a complaint. The complaint generally con- tains a description of the wrongful conduct alleged and a request for damages. The defendant is required to respond to or answer the complaint within the time period established by court rules. One answer option for the defendant is a motion to dismiss, which is a request to the court to dismiss the lawsuit on the grounds that, even if everything the plaintiff states in the complaint were true, there is no right to recovery. This response raises an issue of law for the trial court judge to decide at this initial, pretrial stage of the lawsuit; if the motion is successful, it will result in termination of the lawsuit. Recent Supreme Court reinterpretation of Rule 8(a)(2) of the Federal Rules of Civil Procedure now requires plaintiffs to plead fac- tual allegations in their complaints that show “plausible entitlement to relief.”20

Under this more stringent rule, a complaint must now include factual allegations that raise the right to relief above the speculative level. Merely pleading “labels and conclusions” or setting forth a formulaic recitation of the elements of a cause of action is insufficient.

The Federal Rules of Civil Procedure permit each party to obtain from the adverse party information about all witnesses, documents, and any other items

20 Federal Rule of Civil Procedure 8(a)(2) provides that “[a] pleading that states a claim for relief must contain … a short and plain statement of the claim, showing the pleader is entitled to relief.” FED. R. CIV. P. 8(a)(2). In Conley v. Gibson, 355 U.S. 41, 47 (1957), the Supreme Court set forth a “notice pleading” standard to the effect that a pleading “need only include a short plain statement of the claim that will give the defendant fair notice of what the claim is, and the grounds upon which it rests.” The Conley notice pleading standard was “retired” by the reinterpretation of Rule 8(a)(2) in the Supreme Court’s decisions in Bell Atlantic Corp. v. Twombly, 550 U.S. 544 (2007) and Ashcroft v. Iqbal, 129 S. Ct. 1937 (2009).


relevant to the case. The pretrial process called discovery requires each side to name its potential witnesses and to provide each side the opportunity to question those witnesses in advance of the trial. Each party also has the opportu- nity to examine, inspect, and photograph books, records, buildings, and machines. Even examining the physical or mental condition of a party is part of discovery when such an examination is relevant to the case. The scope of discov- ery is extremely broad because the rules permit any questions that are likely to lead to admissible evidence.

A deposition is the testimony of a witness taken under oath outside the court- room; it is transcribed by a court reporter. Each party is permitted to question the witness. If a party or witness gives testimony at the trial that is inconsistent with deposition testimony, the prior inconsistent testimony can be used to impeach the witness’s credibility at trial.21 Other forms of discovery include written interrogato- ries (questions) and written requests for production of documents. Because responding to discovery requests can be very time-consuming to the answering party, and may incur considerable legal expenses, such requests often lead to pre- trial legal disputes between the parties and their attorneys.

Under the Rule 8(a)(2) pleading standard, federal judges can now terminate employment discrimination cases through motions to dismiss, thereby precluding plaintiffs from conducting discovery to support their claims. One of the primary reasons for the Court’s new “plausibility” pleading standard is to limit defendants’ discovery costs by weeding out groundless claims.

MOTION FOR SUMMARY JUDGMENT. Motions for summary judgment are very common in employment discrimination lawsuits.22 A motion for summary judgment can lead to the pretrial adjudication of the controversy if the pleadings, discovery, disclosure materials, and affidavits show that there is no genuine issue as to any material facts. The court is then able to decide the case as a matter of law, reviewing all the evidence, facts, and inferences in the light most favorable to the nonmoving party. To defend against a summary judgment motion, the nonmoving party must present evidence sufficient to permit a reasonable jury to find in its favor.

In 2002, Vicky Crawford was asked by a human resources officer if she had witnessed inappropriate behavior by a school department supervisor, Hughes, and Crawford related several instances of sexually obnoxious behavior by that individ- ual. The school department Crawford worked for took no action against Hughes,

21 At a February 16, 2011, web conference sponsored by the American Law Institute-American Bar Association, a management attorney stated that from his perspective, the plaintiff’s deposition is the “single most important event in the case;” and that he uses that deposition to supplement his summary judgment brief. A plaintiff’s attorney believes that the employer-decisionmaker’s deposition winds up being the most important because it may show that individual’s mindset. Laura D. Francis, Attorneys Stress Importance of Depositions Preparing Witnesses in Employment Lawsuits, Daily Lab. Rep. (BNA), No. 36, at C-1 (Feb. 23, 2011). 22 One recent study of employment discrimination cases in federal district courts found that the courts decided summary judgment motions by defendants in 22.8% of the cases, with defendants experiencing a 63.6% success rate on these motions. Vivian Berger et al., Summary Judgment Benchmarks for Set- tling Employment Discrimination Lawsuits, 23 HOFSTRA LAB. & EMP. L.J. 45, 53, 55 table 1, 57 table 3 (2005).


but soon thereafter terminated her. She brought suit in federal court under Title VII of the Civil Rights Act, claiming that she had been retaliated against for her report of Hughes’s behavior. The federal district court granted the employer’s motion for summary judgment because Crawford had not instigated or initiated a complaint of sexual harassment under Title VII and was thus not protected by the anti- retaliation provision, Section 704(a) of Title VII. She appealed and the Sixth Circuit Court of Appeals affirmed. In 2009, the Supreme Court unanimously reversed the Sixth Circuit, concluding that “nothing in the statute requires a freakish rule pro- tecting an employee who reports discrimination on her own initiative but not one who reports the same discrimination in the same words when her boss asks a question.”23 It was not until 2010, after the applicable legal rule was settled by the Supreme Court, that an actual trial took place on the merits of Crawford’s retaliation lawsuit. The jury found that the employer’s reasons for firing Crawford were pretextual and awarded Crawford $420,000 in compensatory damages, $408,762 in back pay, and $727,496 in front pay, for a total monetary award of approximately $1.56 million.24


The U.S. federal court system is clustered geographically into 12 judicial circuits, including one for the District of Columbia. A thirteenth Federal Circuit located in Washington, D.C., is defined by subject matter such as patent and trademark appeals (see Figure 2.1). Persons or businesses who lose cases before the NLRB or the numerous agencies under the Department of Labor may obtain review of the final order of the agency in the U.S. Court of Appeals. Section 10(f) of the Taft- Hartley Act designates that such review take place in the circuit where the unfair labor practice is alleged to have taken place or where the person resides or trans- acts business or in the D.C. Circuit Court of Appeals. The Board has no authority to compel compliance with its final orders, and under Section 10(e) of the Act, it must apply to an appropriate U.S. Court of Appeals for enforcement of its final order. Generally, a panel of three judges reviews each case. However, some deci- sions, called en banc decisions, are made by the circuit’s full panel of judges.


From a labor and employment law perspective, the nine justices of the Supreme Court hear appeals from the U.S. Court of Appeals, using “judicial discre- tion” in selecting the issues of public importance that the Court will hear during each term from the hundreds of cases appealed to the Court. When the Court deci- des to hear a case, it issues a writ of certiorari, giving official notice that it will review the case. It is common for the Court to decide to review an issue when a U.S. Court of Appeals has rendered a decision in conflict with a decision of another

23 Crawford v. Metropolitan Government of Nashville, 129 S. Ct. 846, 851 (2009). 24 See Kevin McGowan, Jury Awards $1.5 Million to Plaintiff Whose Claim Reached Supreme Court, Daily Lab. Rep. (BNA), No. 19, at A-7 (Feb. 1, 2010).


U.S. Court of Appeals on the same matter—called a “conflict in the circuits.” For example, in Burlington Northern & Santa Fe Railway v. White, the Third, Fourth, and Sixth Circuits had applied a different standard for the anti-retaliation provision of the Civil Rights Act than the District of Columbia Circuit and the Seventh Cir- cuit applied. The Supreme Court was called upon to resolve the splits in the circuits in the BNSF v. White case. The case is presented in Chapter 12.


1. In April 2002, Evelyn Coke, a domestic worker who provided “companionship ser- vices” to elderly and infirm men and women, brought a lawsuit against her former employer, Long Island Care at Home, Ltd. (LI Care), and its owner, Maryann Osborne.

Ms. Coke alleged that LI Care failed to pay her the minimum wages and overtime wages to which she was entitled under the Fair Labor Standards Act (FLSA), and she sought a judgment for those unpaid wages. All parties assume for present purposes that the




Nevada Utah

Arizona New Mexico

Colorado 10




Montana North Dakota

South Dakota







Missouri ST. LOUIS








Mississippi Alabama



South Carolina

North Carolina

Virginia Pennsylvania


Rhode Island


Connecticut NEW YORK

Maryland Delaware


New Hampshire

New York Idaho Massachusetts


















Virgin Islands

Puerto Rico

D.C. Circuit Washington, D.C.*

Federal Circuit Washington, D.C.**






West Virginia

FIGURE 2.1 | THE 13 FEDERAL JUDICIAL CIRCUITS *A sizable portion of the caseload of the D.C. Circuit comes from the federal administrative agencies and offices located in Washington, D.C., such as the National Labor Relations Board and the U.S. Department of Labor, as well as appeals from the U.S. District Court of the District of Columbia. **Rather than being defined by geography like the regional courts of appeals, the Federal Circuit is defined by subject matter, having jurisdiction over such matters as patent infringement cases, appeals from the Court of Federal Claims and the Court of International Trade, and appeals from administrative rulings regarding subject matter such as unfair import practices and tariff schedule disputes.

© Ce ng ag e Le ar ni ng

20 13


FLSA entitles Coke to payment if, but only if, the statutory exemption for “companion- ship services” does not apply to compan- ionship workers paid by third-party agencies such as Long Island Care. In 1974, Congress amended the FLSA to include many “domestic service” employees not previously subject to requirements of minimum wage and maximum hours. When doing so, Con- gress simultaneously created an exemption that excluded from FLSA coverage certain subsets of employees “employed in domestic service employment,” including babysitters “employed on a casual basis” and compan- ionship workers. The Department of Labor (DOL) then promulgated a set of regulations that included the following:

The FLSA does not define the statutory terms “domestic service employment” and “companionship services.” It authorizes the Secretary of Labor “to prescribe necessary rules, regulation, and orders with regard to the 1974 amendments made by this Act.” The DOL gave notice, it proposed regula- tions, it received public comment, and it issued final regulations in light of the public comment. The resulting regulation is quoted above. Does the second step of the Chevron framework apply to the facts of this case? Where large enterprise third-party employers like LI Care can avoid paying minimum wage and overtime rates to workers like Evelyn Coke, may reviewing judges find the regulation unwise and unenforceable? Decide. [Long Island Care at Home, Ltd. v. Coke, 127 S. Ct. 239 (2007)]

2. Section 7 of the National Labor Relations Act (NLRA) provides in part that employees

shall have the right “to engage in … concerted activities for the purpose of … mutual aid or protection.” In 1973, the Labor Board issued its Weingarten decision, which held that an employer violates Section 8(a)(1) of the NLRA when it denies an employee’s request, based on Section 7 of the Act, for the presence of a union representa- tive at an investigatory interview that the employee reasonably believes might result in disciplinary action. The Board’s decision was upheld by the Supreme Court, and the right of an employee to request and obtain the presence of a coworker at an investigatory interview was extended to nonunion work- places by the Board’s 1982 Material Research Corp. decision. Three years later, in 1985, the Reagan Board reversed this decision in the Sears, Roebuck Co. case, holding that Weingarten principles do not apply in nonunion settings. In the Clinton Board’s year 2000 Epilepsy Foundation of Northeast Ohio decision, it reimposed the Materials Research holding, concluding that unrepresented employees have a right to have a coworker present during investiga- tory interviews. And three years later, with the changing composition of the Board, on June 9, 2004, in a 3–2 decision, the Bush II Board reversed the year 2000 decision in its IBM Corp. decision and ruled that nonunion employees do not have the right to have a coworker present during an investigatory interview. Read the edited version of the IBM Corp. case in Section 5.2.

Consider the merits of the policy consid- erations relied on by the majority. Remember that the Labor Board’s custom is to follow an “adjudication” method of establishing policy precedents. Was the Board majority within the Chevron principles when it made the policy decision to divest more than 90 percent of all nonmanagement workers employed in the U.S. private sector subject to the NLRA the right to have a coworker present at an inves- tigatory interview that could lead to discipline

Interpretations, says that exempt companion- ship workers include those who are employed by an employer or agency other than the family or household using their services…. [whether] such an employee [is assigned] to more than one household or family in the same work- week…. 40 Fed. Reg. 7407 [codified at 29 CFR § 552. 109(a)].


or discharge? Decide. [IBM Corp., 174 LRRM 1537 (2004)]

3. Title IX prohibits sex discrimination by recipients of federal education funding, and the Supreme Court held in Jackson v. Birmingham Board of Education, 544 U.S. 167 (2005), that the statute provides a private right of action to remedy retaliation by a funding recipient against an individual who has complained about sex discrimina- tion. The cause of action for unlawful retaliation requires a showing that (1) the plaintiff participated in activity protected by Title IX; (2) the university took adverse employment action against him; and (3) a causal connection exists between the pro- tected activity and the adverse action.

Claude Cummings was the women’s basketball coach at Texas Southern Univer- sity (TSU). He had complained to the new interim athletic director, with specific details, that TSU had been violating Title IX by treating the men’s basketball program more

favorably than the women’s program. Just one week later, in February 2008, Cummings was terminated.

Cummings had been hired in 2003 as head coach for the women’s basketball team. The team won 10 games and lost 17 in his first year, but then won only 5 games during each of the next 3 seasons. In his final season, the team won 8 games and lost 16. The academic record of the players in the women’s basket- ball program was also subpar while Cum- mings was head coach; each year an NCAA academic performance rating for the team fell below the median for teams in TSU’s division.

Cummings sued TSU for unlawful Title IX retaliation. Should this case be resolved by a motion for summary judgment, or should the case proceed to a trial before a jury where the jury can consider if his termination one week after his complaint about TSU’s violation of Title IX was retaliatory? [Cummings v. Texas Southern University, 2011 U.S. Dist LEXIS 49181 (S.D. Tex., 2011)].


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3:1 Introduction

3:2 Bargaining Representation

3:3 Mediation, Arbitration, and Emergency Boards

3:4 Major and Minor Disputes

3:5 Railroad and Airline Boards of Adjustment

3:6 The Surface Transportation Board

3:7 Strike Injunctions

3:8 Jurisdictional Issues: The RLA and the NLRA


After nearly half a century of experimental legislation, the Railway Labor Act (RLA) was enacted in 1926 to promote stability in labor-management relations. Rail carriers and railroad unions conferred for several months and agreed on a comprehensive framework for the peaceful adjustment of both major and minor disputes that could interrupt the passenger and freight service rendered to the nation; Congress enacted their agreement into law by a wide margin. The RLA sought to resolve disputes through mediation and voluntary arbitration rather than by the self-help measures of strikes, lockouts, and unilateral changes in working conditions and pay rates. The act was amended in 1936 to bring the airline industry within its coverage.

The National Mediation Board (NMB) is the principal agency responsible for administration of the RLA. It resolves issues regarding employee representation, in


furtherance of employees’ right to bargain collectively through representatives of their own choosing, and provides mediation and other dispute resolution tools that enable unions and management to make and maintain collective bargaining agreements. The National Mediation Board (NMB) is composed of three impartial members appointed by the president, no more than two of whom can be from the same political party. Their terms extend for three years.


The NMB has exclusive authority, under Section 2, Ninth of the RLA, to determine a broad range of representation issues. NMB decisions classify employees of a carrier to include all employees of the carrier, systemwide, who perform the job functions associated with their “craft or class.”1 Some current crafts or classes in the railroad industry include conductors, who are in charge of each train; locomotive engineers, who are responsible for the safe and efficient operation of their trains; dispatchers, who have primary responsibility to direct and control the movement of trains; signal- men, who maintain signals; maintenance of way employees, who are the construc- tion workers of the industry, and are responsible for road, track, and structure maintenance; carmen, who build and maintain freight and passenger cars; numerous “shop crafts” who maintain locomotives and equipment, including such crafts as electrical workers, machinists, sheet metal workers, and boilermakers; and a broad craft of clerical, information technology, and customer service employees.

Some principal crafts or classes in the airline industry include: flight deck crews, who include pilots and copilots; flight attendants, who perform cabin crew functions on aircraft; machinists, who perform maintenance work on aircraft and engines; and related employees who perform ground service functions.

The NMB usually conducts secret ballot representation elections by telephone or Internet, providing instructions and confidential identification numbers to voters, who may vote by either method. In 2010, the NMB instituted a new rule revising representation election procedures; under this rule, employees vote either “yes” for representation or “no” if they oppose representation, with the outcome of the election determined by the simple majority of the votes cast by the employees of the craft or class in question.2 Under the NMB’s prior policy, which had been in effect for more than 75 years, a union was required to win the vote of a majority of all eligible employees to become certified as the bargaining representative, with employees who did not cast votes counted as “no” votes. The NMB had required a showing of

1 Organizing under the RLA is perceived as more difficult by some unions because the representation election of the craft or class is system wide and can be nationwide in scope. Under the National Labor Relations Act (NLRA), bargaining units can be localized to a specific geographical area. For example, FedEx Ground, FedEx Freight, and FedEx Office are covered by the National Labor Relations Act. However, some 90,000 FedEx Express employees working as truck drivers, sorters, and loaders throughout the country picking up and delivering packages handled by this air express carrier are cov- ered by the RLA, and are not unionized. (FedEx’s 4500 pilots are union members.) The Teamsters union, which represents employees at United Parcel Service (UPS) in local unions throughout the United States under the NLRA, supports federal legislation that would remove express carriers from RLA jurisdiction; in 2011 it launched a campaign entitled “FedEx Drivers Aren’t Pilots.” FedEx Express asserts that the legislation is a UPS bailout by the union. 2 Air Transport Ass’n v. National Mediation Board, No. 10-CV-00804 (D.D.C. 2010).


valid authorization cards from at least 35 percent of the employees of a craft or class in order to conduct a secret ballot election. In reaction to the NMB’s new “simple majority of votes cast” rule, a labor provision was attached to the Federal Aviation Administra- tion Reauthorization and Reform Act of 2012, which changed National Mediation Board procedures to require a 50 percent showing of valid signed authorization cards in order to conduct a secret ballot election.


The purpose of the RLA is to avoid work stoppages by employees and lockouts by employers by establishing a legal basis for negotiation, mediation, and interest arbi- tration of new collective bargaining agreements, or reopened agreements under Sec- tion 6 of the RLA, when a party serves upon the other a written notice of proposed changes in rates of pay, rules, and/or working conditions. Mediation questions under Section 5 of the RLA concern reconciliation of differences between carriers and labor organizations at the time they are negotiating agreements on wages, hours, and working conditions. If mediation is unsuccessful, the NMB is required to propose arbitration under Section 5, First of the RLA. If arbitration is rejected, the NMB may, pursuant to Section 10 of the RLA, advise the President of the United States that the dispute threatens to deprive sections of the country of essen- tial transportation service. The president then has the discretionary power to issue an executive order creating a Presidential Emergency Board (PEB) to investigate and file a report concerning the dispute. The PEB, which ordinarily consists of three members, will then hold hearings and submit a report to the president within 30 days, setting forth recommendations for fair and equitable resolution of the dis- pute. The disputants are required by law to maintain the status quo until the emer- gency board submits its report and for 30 days thereafter, during which time the parties again must try to reach an agreement based on the recommendations. At the expiration of a maximum of 60 days, if the parties still are at an impasse, they are free to engage in a strike or a lockout. The effect is to delay action on the part of the disputants in the hope that they will satisfactorily settle their dispute. Labor is not deprived of its right to strike under the Act, nor is the employer deprived of the lockout option; however, these rights may be exercised only upon compliance with the purposely long and drawn-out procedures of the Act.

Congress has not allowed widespread work stoppages to occur in the railroad industry, but has resolved disputes by enacting legislation binding the parties to the recommendations of the Presidential Emergency Boards or by imposing a form of “last best offer” arbitration.3 Because Congress has the power to enforce

3 Congress resolved a one-day nationwide rail strike in 1991 by enacting Pub. L. 102–29, which had the effect of imposing most of the recommendations of PEB 219. On July 26, 1992, Congress enacted Pub. L. 102-306 to end a two-day nationwide strike/lockout, a law that mandated a form of last best offer arbitration subsequent to the recommendations of PEBs 220, 221, and 222. The use of Presiden- tial Emergency Boards has not been common in the airline industry. However, in the context of a threatened airline strike planned for the holiday period of December 2001, which would have deprived the country of essential transportation services, PEB 236 was created on December 20, 2001, by President G. W. Bush to investigate and report on a dispute between United Airlines and the Machinists Union, Local 141-m. Subsequently, the parties were able to reach agreement without a work stoppage.


emergency board recommendations, the recommendations have a very significant weight with the parties and may serve as the basis for the resolution of the dis- putes.4 The Burlington Northern v. BMWE decision, which held that federal courts may not enjoin secondary picketing by railroad employees, contains a vivid example of the dispute resolution procedures of the RLA.

4 For example, the recommendations of Presidential Emergency Board No. 211, August 14, 1986, served as the basis of the resolution of the multi-issued dispute between six railway unions representing 107,000 employees and most of the nation’s Class 1 railroads concerning the renewal of their collective bargaining agreements. The 1996 round of PEBs led to the peaceful resolution of contract negotiations for most of the industry’s carriers and unions.

Section 9a of the RLA allows the parties to a labor dispute involving commuter rail passenger ser- vice, or a governor of any state involved, to request the president to establish a PEB to investigate and issue a report and recommendations regarding the disputes. See, for example, PEB 237, involving SEPTA and the United Transportation Union, report dated May 11, 2004. If the matter is not resolved under the first PEB, a second emergency board may be created which will consider the parties’ final settlement offers and select the most reasonable offer.


[The Brotherhood of Maintenance of Way Employees (BMWE) expanded its strike against the Maine Central Railroad to other rail carriers that had no connection and were not substantially aligned with the struck railroad. A federal district court in Illinois issued a preliminary injunction against the union’s picketing of any railroad other than those involved in the primary dispute. The court of appeals reversed the district court, holding that under the Norris- LaGuardia Act (the Federal Anti-Injunction Act), a federal court does not have jurisdiction to enjoin secondary picketing in railway labor disputes. The Supreme Court granted certiorari to decide whether a federal court has jurisdiction to issue such an injunction.]

Brennan, J.… [A]s this case illustrates, § 10 of the RLA provides a ready mechanism for the Executive Branch to intervene and interrupt any self-help measures by invoking an Emergency Board and thereby imposing at a minimum a 60-day cooling-off period. If the Board’s recommendations are not initially accepted

by the parties, Congress has the power to enforce the Board’s recommendation by statute, as it has done here. Allowing secondary picketing in the self-help period is thus not inconsistent with the structure or purpose of the Act, and may in fact increase the likelihood of settlement prior to self- help. This is therefore not a case in which “the scheme of the Railway Labor Act could not begin to work without judicial involvement.” Chicago & North Western, supra. 402 U.S. at 595 (Brennan J., dissenting).

While opinions regarding the RLA’s success in meeting its goals have varied over time, it does appear that under the RLA labor and management have been able to resolve most conflicts without resort to sec- ondary picketing. We decline, at this advanced stage of the RLA’s development, to find in it an implied limit on a union’s resort to secondary activity. Instead, “if Congress should now find that abuses in the nature of secondary activities have arisen in the railroad industry … it is for the Congress, and not the Courts, to strike the balance ‘between the uncon- trolled power of management and labor to further




Railway management and railway labor commonly classify disputes between them- selves as “major” or “minor.” Railway management ordinarily cannot change the rates of pay, rules, or working conditions of its employees contained in labor agree- ments except by following the lengthy process of bargaining and mediation required by the Railway Labor Act, particularly Section 6 of the Act.5 Railway unions seeking better wages, hours, and working conditions also must follow the lengthy process of the RLA. Such disputes are considered major disputes.

In contrast, a minor dispute is a dispute between a carrier and a union over meaning or application of a particular provision of an existing collective agreement.

A dispute may involve whether the carrier violated the discipline rule of the collective agreement by discharging an employee or disagreement over the proper application of a pay rule in the agreement. Minor disputes are resolved, after proper handling on the railroad property, by the National Railroad Adjustment Board (NRAB) or another adjustment board established by the carrier and the union under Section 3 of the RLA.6 The BNSF and UTU arbitration award pre- sented in the next section is an example of a minor dispute resolved by a board of adjustment that consisted of a carrier official, a union official, and a neutral chairperson.

Railway management and labor often disagree over whether a dispute is a major or minor one. The courts look at whether a claim has been made where the terms of the existing agreement establish the right to take the disputed action. The dispute may thus be conclusively resolved by interpreting the existing agreement, making it a minor dispute. Other disputes are major disputes. In Consolidated Rail Corp v. RLEA,7 the Supreme Court held that “[i]f an employer asserts a claim that the parties’ agreement gives the employer the discretion to make a par- ticular change in working conditions without prior negotiation, and if that claim is arguably justified by the terms of the parties’ agreement (i.e., the claim is neither obviously insubstantial or frivolous, nor made in bad faith),” it is a minor dispute, and the employer may make the change and the courts must defer to the arbitral jurisdiction of the adjustment board. The Brotherhood of Maintenance of Way

their respective interests.’” Trainmen v. Jacksonville Terminal Co., 394 U.S., at 392….

… In the Norris-LaGuardia Act, Congress divested federal courts of the power to enjoin secondary picketing in railway labor disputes. Congress has not seen fit to restore that power. Accordingly, we affirm the decision of the Court of Appeals.

It is so ordered.

Case Questions

1. Do procedures exist for the executive branch to intervene in a railway labor dispute and interrupt any self-help measures that may be disrupting essential transportation services?

2. Does the Supreme Court have the power to enjoin secondary activity by rail unions?

5 45 U.S.C. § 156. 6 45 U.S.C. § 153. 7 491 U.S. 299 (1989).


Employes v. BNSF Railway case, presented in this section, is a recent example of the Conrail court’s rule on “major” and “minor” disputes.

In Hawaiian Airlines v. Norris,8 Grant Norris, an airplane mechanic, was termi- nated for insubordination for failure to sign a maintenance record for a plane he considered unsafe, and he reported the mechanical problem to the Federal Aviation Administration (FAA). Norris filed suit in a state court under the Hawaii Whistle- blower Protection Act, claiming he was wrongfully terminated in violation of the Whistleblower Act for reporting the mechanical problem. The airline contended that the termination was a minor dispute subject to the exclusive dispute resolution provisions of the RLA and that the state court theory was preempted by the RLA. The Supreme Court decided that Norris’s whistleblower claim was independent of the collective bargaining agreement and not preempted by the RLA.

8 512 U.S. 246 (1994).


[Burlington Northern Santa Fe Railway Company (BNSF) proposed the sale of approximately 290 miles of BNSF’s rail line to the New Mexico Depart- ment of Transportation. New Mexico sought to obtain the rail line as part of a plan to provide com- muter rail service between Albuquerque, Santa Fe, and other points within the state. Under the terms of sale, New Mexico would obtain ownership of BNSF’s rail lines, but reserve to BNSF a concurrent freight ease- ment on the lines. New Mexico would also take over maintenance responsibilities of the right-of-way, an obligation previously belonging to BNSF.

In an effort to prevent New Mexico from assum- ing the maintenance responsibilities, two union orga- nizations representing rail workers who had previously performed the maintenance work sued. They contended that the assignment of the mainte- nance obligations (1) violated § 2, Seventh of the Railway Labor Act and (2) breached the collective bargaining agreement between the workers and BNSF. The district court dismissed the action for lack of jurisdiction and the unions appealed.]


Analysis On appeal, the rail workers argue the district court erred in concluding the Adjustment Board has exclu- sive jurisdiction over their claims….

A. Legal Framework for Resolving RLA Disputes

The RLA provides a comprehensive and mandatory framework for resolving labor disputes under collec- tive bargaining agreements. Hawaiian Airlines, Inc. v. Norris, 512 U.S. 246, 252 … (1994). It aims “to encourage collective bargaining by railroads and their employees in order to prevent, if possible, waste- ful strikes and interruptions of interstate commerce.” United Transp. Union v. Burlington N. Santa Fe R.R. Co., 528 F.3d 674, 677–678 (9th Cir. 2008)….

The RLA sets forth two provisions relevant to the workers’ claims. The first is … § 2, Seventh. Under this provision, no carrier “shall change the rates of pay, rules, or working conditions of its employees, as a class, as embodied in agreements except in the manner prescribed in such agreements or in § 6 of [the RLA].” Pursuant to § 6, … carriers must give notice of major changes to pay, rules, or working conditions and, if arbitration is requested, maintain the status quo ante during the proceedings. The rail workers contend BNSF breached the “scope of work” provisions contained in its collective bargaining agreement and thereby violated § 2, Seventh by improperly contracting the maintenance responsibili- ties on the rail lines to New Mexico.

RLA disputes can be resolved either in federal court or in the Adjustment Board through binding arbitra- tion. To determine which forum is appropriate in the



first instance, the Supreme Court has created a two- part classification system: If a dispute is “major,” it is not subject to Adjustment Board arbitration and should be resolved in federal court. If a dispute is “minor,” binding arbitration before the Adjustment Board is mandatory. This appeal requires us to deter- mine whether the disagreement between the rail work- ers and BNSF qualifies as a major or minor dispute.

B. Major and Minor Disputes

The RLA provides little guidance regarding how to determine whether a dispute is major or minor, but a series of well-established Supreme Court cases have laid out a framework for answering this question. See Cons. Rail Corp. v. Ry. Labor Executives’ Ass’n, 491 U.S. 299 (1989) (“Conrail”); Norris, 512 U.S. at 252–57. “Major disputes relate to the formation of collective [bargaining] agreements,” Norris, 512 U.S. at 252 (quotations omitted). These disputes relate to contract formation and arise

where there is no such agreement or where it is sought to change the terms of one, and therefore the issue is not whether an existing agreement controls the controversy. They look to the acqui- sition of rights for the future, not to assertion of rights claimed to have vested in the past.

Conrail, 491 U.S. at 302 (citation omitted) (emphasis added). Thus, “major disputes seek to cre- ate contractual rights,” Id.

In contrast, “minor disputes” seek to “enforce [contractual rights],” Id. They arise “out of the inter- pretation or application of” existing collective bar- gaining agreements, Id. at 303….

The Supreme Court has stressed that the relative importance of a case does not determine whether it qualifies as a major or minor dispute, Conrail, 491 U.S. at 305. Rather, we look to “whether a claim has been made that the terms of an existing agreement either establish or refute the presence of a right to take the disputed action. The distinguishing feature of such a case is that the dispute may be conclusively resolved by interpreting the existing agreement,” Id.…

The Supreme Court has emphasized the primary importance of labor arbitration under the RLA. To that end, the default position for courts is to deem a dispute as minor if it even remotely touches on the terms of the relevant collective bargaining agreement. “[W]hen in doubt” the courts are to “construe

disputes as minor” [citation omitted]. Indeed, a party bears a “relatively light burden” in establishing exclusive jurisdiction in the Adjustment Board under the RLA, Conrail, 491 U.S. at 307.

To meet this burden, a party need only show that the contested action is “arguably justified” by the terms of the collective bargaining agreement.…

The Court has identified a number of factors to consider in determining whether either party’s claim is “arguably justified.” We look first and primarily, of course, to both the express and implied provisions of the collective bargaining agreement, Conrail, 491 U.S. at 320…. Of equal importance is the parties’ “practice, usage and custom” in negotiating and operating under applicable labor agreements. Id. at 311.

Other non-exclusive factors arising from cases applying Conrail include (1) arbitration decisions interpreting the bargaining agreement, (2) arbitration decisions interpreting similar language in other bar- gaining agreements, (3) the absence of a term prohi- biting the carrier’s action, (4) industry practice, (5) the intent behind and nature of the actions giving rise to the dispute, (6) any relevant amendments or side letters, and (7) unsuccessful attempts to “obtain through bargaining rights the carrier later contended it possessed,” ABA, THE RAILWAY LABOR ACT, 389–93 (2d ed. 2005).

* * *

C. The Dispute Here Is Minor

… First, the CBA supports BNSF’s position. The CBA places no restrictions on the company’s right to sell rail lines. Nor does the CBA explicitly establish that BNSF is obligated to continue using its employees to maintain lines BNSF has sold but over which it retains a freight easement and common carrier obligations.

Second, “practice, usage and custom,” Conrail, 491 U.S. at 311, support the conclusion that BNSF’s position is “arguably justified” by the CBA.… The record shows, for example, that BNSF has previously sold properties to third parties and ceded its maintenance obligations. For example, in the mid-1990s, BNSF sold a right-of-way to public agencies in California, retained an exclusive freight easement over the lines, but was no longer responsible for maintaining the track, …

* * * continued




The NRAB was created by the 1934 amendment to interpret questions “grow- ing out of grievances or out of the interpretation … of [existing] agree- ments concerning rates of pay, rules, or working conditions” (RLA Section 3, First, (i)).

The RLA, as amended in 1966, provides that NRAB awards shall be final and binding on the parties to the dispute.9 If a carrier does not comply with an NRAB order implementing an award, a proceeding for enforcement of the award may be brought in a U.S. district court up to two years after noncompliance. Under the 1966 amendments, the losing party may also obtain court review of an adverse order of the NRAB, but the grounds for judicial review are the narrow grounds commonly provided for review of arbitration awards. Section 3, First, (p) and (q), provides that an order may be set aside in either enforcement or review pro- ceedings only on the three following grounds:

1. Failure of the NRAB to comply with the requirements of the RLA 2. Failure of the order to conform, or confine itself, to matters within the scope

of the NRAB’s jurisdiction 3. Fraud or corruption by a member of the NRAB

Unions have an obligation to provide fair representation for all persons in a bargaining unit, and an individual may bring a lawsuit on the theory that a union breached its duty of fair representation.10

In sum, the dispute here meets Conrail’s “arguably justified” standard. Under the CBA and in light of the relevant factors that guide our inquiry, BNSF argu- ably had the authority to sell the rail lines at issue and to include in that sale the responsibility to main- tain the lines—reducing union maintenance jobs— despite retaining a freight easement and common carrier obligations. BNSF’s view of the CBA is suffi- ciently reasonable to meet its “relatively light burden” under Conrail, …

III. Conclusion Because the dispute is minor, it is subject to mandatory arbitration. The district court correctly determined

arbitration is the proper venue for this dispute, and we therefore AFFIRM its order.

Case Questions

1. Two forums exist to resolve RLA disputes, the federal courts and arbitration. Explain the broad classification system used to determine which forum is appropriate to solve the controversy.

2. Explain the procedures used to resolve major and minor disputes under the RLA.

3. How did the court decide this case?

9 The 1996 amendments eliminated an exception for money awards. 10 Foust v. Electrical Workers, 442 U.S. 42 (1979). See Section 9.2 of this book for a discussion of the law concerning a union’s duty of fair representation.



The 1966 amendments to the RLA provide that unions or carriers may request the establishment of special boards of adjustment (called PL Boards by the National Mediation Board under Public Law 89–456) to resolve disputes that have been pending before the NRAB for a year or more. These boards consist of three mem- bers. The provision authorizing such special boards was added to the RLA to elim- inate a large backlog of cases then pending before the NRAB and to build in a procedure for the expeditious handling of future cases. Even before the 1966 amendments, the RLA, Section 3, Second, authorized the establishment of system, group, or regional permanent adjustment boards by mutual consent of the parties for the local settlement of disputes otherwise referable to the NRAB for hearing at the NRAB’s headquarters in Chicago, Illinois. The awards of special, system, group, or regional boards of adjustment have the same legal effect as an NRAB award.11 The BNSF and UTU arbitration decision presented in this section was heard before a PL Board.


The airlines are not subject to NRAB jurisdiction. The RLA provides for air carriers and their employees to establish system boards of adjustment for the resolution of grievances. In Machinists v. Central Airlines, Inc., the Supreme Court ruled that awards of air carrier system boards of adjustment are enforceable by federal law in federal courts.12 Like NRAB procedures, the NMB aids in the designation of neutrals for service with air carrier system boards. However, neutrals are not compensated by the NMB, as are the neutrals who serve with the NRAB. The parties are required to compensate the neutrals who serve with air carrier boards.

11 In Cole v. Erie Lackawanna Railway Co., 541 F.2d 528 (6th Cir. 1976), the Sixth Circuit Court of Appeals found that federal district courts could exercise limited judicial review over determinations of PL Boards. The court of appeals agreed with the trial court that Section 3, First, (j), requires the board to serve formal notice of its proceedings on the aggrieved party so that the party would be in a posi- tion to make a determination as to whether the party wanted to be represented by the union, by coun- sel, or by self-representation. In Ollman v. SBA No. 1063, 2005 WL 602386 (W.D.N.Y. Mar. 14, 2005), a federal district court held, however, that when an employee is represented by a union, the car- rier need not give notice of an SBA hearing to the employee and that notice to the employee by the union is sufficient. 12 372 U.S. 682 (1963).


[Engineer S_ was suspended from work for one year for operating rules violations regarding his handling of his train’s speed in the descent of the Cajon Pass east of San Bernardino, California, on March 8, 1998. The matter was appealed to a Public Law

Board, whose binding decision was rendered on June 5, 2001.]

On the Cajon Subdivision, trains are required to maintain certain speeds while descending the steep grade at Cajon Pass west of Summit depending on



the tonnage of the train and braking capacity accord- ing to the requirements set forth in Division Time Table No. 2 in effect October 1, 1996. On March 8, 1998, Engineer S_ and Conductor Klatt operated [their train] from Barstow to Los Angeles. Some 10 days later, … they were contacted by Road Foreman of Engines J.L. Worcester who was investigating the speed of their train between Cajon and Baseline on March 8, 1998. Engineer S_ was held out of service soon after his discussions with Mr. Worcester.

The record reveals that the speed of westbound trains operating over the Cajon Pass are subject to strict scrutiny by the Carrier, and it is well known by all employees operating in this area that event recorders will be read for train speed by a Carrier official for all westbound trains operating over the Cajon Pass. Both Engineer S_ and Conductor Klatt testified that they used the Carrier rules and the paperwork given for their train in Barstow on March 8, 1998 to determine what speed to operate down the Cajon Pass. They both testified that they determined their train was a “15–30” train, meaning that their train travelling on the south track from Summit to Cajon was to operate at 15 mph, and from Cajon to Baseline the train was to operate at 30 mph. Were their train to be over 6,500 tons, under the speed regulations set forth in Division Timetable No. 2, they would be required to operate at 20 mph from Cajon to Baseline.

Conductor Klatt testified in part in response to questions from the Hearing Officer:

Q There’s been an awful lot of testimony here and many, many exhibits about this train and other trains and how the computer system works. And Mr. Martin, who I would consider an expert, said for the record that no information that he saw would tend to make myself or anyone reading the transcript think that your train was less than 6,500 tons.

Is there anything that comes to your mind that would tend to—that needs to be entered in here today that would make me think otherwise?

A The only thing that I could add is that, when I get there and do my signal awareness form what we qualify for in the back there, and I do fill those out and turn them in. As new as I am and as cautious as I am, I know I did it. And I haven’t had one engineer yet that hasn’t asked me “What did you get?”

And if there is a discrepancy between us two, then we go back and figure it out what it is before we even leave the lobby. And I know that S_ and I had done that.

Q S_ is?

A S_. I know S_ and I did that before we left the lobby. Even as we’re going along before we go down the hill, I still open up my book to make sure what we are just because I’m new. I just want to make sure.

There is no question that the crew believed that their train was a “15-30” train, not a “15-20” train. Indeed, Road Foreman of Engines J.L. Worcester testified in part that the crew had run the train as though they had a train under 6,500 tons as follows:

Q Do you have the same list that the train crew had?

A No, I do not.

Q Did they operate that train between Summit and Baseline on the south track as if they had had a train under 6,500 tons?

A Yes.

A fair and proper evaluation of whether or not Engineer S_ exceeded the proper speed in violation of the Carrier rules requires a review of the paperwork that Conductor and Engineer used on March 8, 1998 to determine the speed for the Cajon Pass….

The Hearing Officer questioned Engineer S_ as follows:

Q Okay. And, again, besides Exhibit C, which is the list you’re talking about, all the other exhibits, the AEI scanners, the archive, the files of train lists, the Train Event, is any of that information ever less than 6,500 tons?

A I wouldn’t know. I don’t even know—I have never seen any of that information or how to obtain it before….

All of the other exhibits referred to by the Hearing Officer had no meaning to Engineer S_. A mountain of printouts cannot substitute for the critical documents that were not produced in this case—the train list with the train profile which the crew members used to determine the appropriate speed to descend the Cajon Pass. It may well be that the train in fact was over 6,500 tons. But the crew is only responsible for the Rules violations charged if the information provided




The Surface Transportation Board created under the ICC Termination Act of 1995 has the responsibility to approve the consolidation, merger, or sale of any railroad properties.13 Under the prior statute, the ICC had authority to require railroads seeking expedited approval of rail line acquisitions or mergers to provide economic protection for adversely affected employees. The ICC developed New York Dock conditions in the case of rail mergers, control and acquisition transactions, and consolidations, which provided up to six years of income protection for terminated or displaced rail employees. Other types of standard conditions imposed by the ICC include Mendocino Coast conditions for lease transactions, Norfolk and West- ern conditions for trackage rights, and Oregon Short Line conditions for abandon- ments. The ICC Termination Act of 1995 contains specific statutory language that limits the Surface Transportation Board’s authority regarding protection for mid- sized or Class II rail carriers. In the Association of American Railroads v. Surface Transportation Board case, the U.S. Court of Appeals for the D.C. Circuit reversed

them on the train list and train profile at Barstow on March 8, 1998 showed the train to be over 6,500 tons.

In the instant case, Mr. Martin testified that there was no way to go back into the computer system and print out a copy of the list that would have been given the crew on March 8, 1998 in Barstow. And the record reveals that the crew members do not keep this paperwork in the ordinary course of their duties for the Carrier, nor has any requirement been shown that such paperwork should be turned into the Car- rier. Conductor Klatt testified that he turned into the Carrier his Signal Awareness Form on which he recorded his figures in determining the speed for the train…. And Mr. Klatt testified that the figures from the train list to determine the speed was what he “input on my signal awareness form.” Such a docu- ment would be relevant and material in this case, but it was not produced by the Carrier.

It is evident that compliance with speed regula- tions over the Cajon Pass is a most serious matter to the Carrier, for improper speed can lead to a catas- trophe. And the matter of discipline for a speed vio- lation to an employee is a most serious matter. In the instant case Engineer S_ was suspended from service without pay from March 16, 1998 through March 15, 1999, with a three year probation period. The

stakes are high for the Carrier and the employee. All parties concerned are genuinely interested in the fairness of the disciplinary system.

As set forth initially the Carrier has the burden of proof. We find it has failed to meet that burden of proof in this case.

Award Claim sustained. [Engineer reinstated to service with back pay.]

Case Questions

1. Did the carrier produce evidence that the train was operating at an excessive speed considering the weight of the train? Did the Board find that the carrier met its burden of proof?

2. If the train was operated 10 miles per hour over the speed limit from Cajon to Baseline in violation of company operating rules and the speed set forth in the division timetable, is a one- year suspension an appropriate penalty for the engineer? Give the carrier’s view on this matter. State the union’s view. What did the Board say about this matter?

13 Pub. L. No. 104-88 (1995). See also 49 U.S.C. § 5.


a Surface Transportation Board decision extending modified severance benefits to railroad workers who were “displaced”—that is, forced to transfer into lower- paying jobs—as a result of an acquisition. The court majority held that the statutory term severance applied only to employees whose employment was terminated.14


As discussed in Section 3.3 of this chapter, the Railway Labor Act sets forth specific procedures that must be followed before employees may exercise their right to strike. When employees strike without fulfilling the requirements of the Act, their employer may seek to obtain a court injunction against the strike. Ordinarily the use of a strike injunction is prohibited because of Section 4 of the Norris-LaGuardia Act. However, the Supreme Court held in Chicago and North Western Railway Company v. United Transportation Union that a strike injunc- tion may be issued when such a remedy is the only practical and effective means of enforcing a union’s duty to exert every reasonable effort to make and maintain agreements.15


The federal Railway Labor Act is the law governing labor relations in the railroad and airline industries, while the National Labor Relations Act is the federal law governing most other private-sector industries and the U.S. Postal Service. The NMB is the agency with primary jurisdiction regarding establishment of representa- tion rights and provision of mediation under the RLA. The National Labor Relations Act (NLRA) excludes from the definition of “employer,” contained in Section 2(2) of the NLRA, “any person subject to the Railway Labor Act.” The National Labor Relations Board (NLRB) usually declines jurisdiction over cases in which the employer meets the definition of “carrier” set forth in the RLA.16

Normally, the NLRB defers to the NMB in the first instance, declining or accepting jurisdiction based on the opinion of the NMB. For example, in the NLRB’s Aircraft Services International Group decision, it declined jurisdiction over a company that provided fueling services for airplanes, work traditionally done by air carriers, relying on the NMB decision to assert jurisdiction.17

In BRT v. Jacksonville Terminal Co.,18 the Supreme Court set forth the standard for determining whether a labor dispute is governed by the RLA or the NLRA, stating “when the traditional railway labor organization acts on behalf of employees subject to the Railway Labor Act in a dispute with carriers subject to

14 162 F.3d 101 (D.C. Cir. 1998). 15 402 U.S. 570 (1971). See also Teamsters v. North American Airlines, 2005 WL 2233915 (N.D. Cal. Sept. 14, 2005). 16 45 U.S.C. § 151 (railroad), § 181 (air carrier). 17 175 LRRM 1395 (2004). 18 394 U.S. 369 (1969).


the Railway Labor Act, the organizations must be deemed, pro tanto, [as far as it goes] exempt from the National Labor Relations Act.”19

In Air Line Pilots Association (ALPA) (ABX Air, Inc.),20 the NLRB ruled that an airline union was subject to the NLRA. The case resulted from complexities fol- lowing a merger and restructuring of companies in the business of rapid pickup, sorting, and carriage of documents, small parcels, and other freight in both ground and air operations. One predecessor employer prior to the merger had a small number of pilots covered by the NLRA, but none of those employees were involved in the underlying dispute, which involved a traditional railway labor organization (ALPA) acting on behalf of employees subject to the Railway Labor Act (ASTAR pilots) and a carrier subject to the Railway Labor Act (ABX Air, Inc.). In its ALPA v. NLRB (ABX Air, Inc.) decision, the Ninth Circuit Court of Appeals ruled, utilizing the Jacksonville Terminal standard, that the NLRB had failed to apply the law correctly and did not have jurisdiction over a grievance filed by the union to enforce a collective bargaining agreement entered into by a carrier under the RLA.21


1. Why did Congress first regulate disputes in the railway industry?

2. How did the 1926 RLA improve the prior situation? How did the 1934 amendments improve the RLA?

3. What rights of employers are protected by the RLA?

4. Why did the 1966 amendments to the RLA establish special boards of adjustment?

5. Does Section 4 of the Norris-LaGuardia Act prohibit the use of strike injunctions in cases arising under the RLA?

6. Flight attendants employed by Transamerica Airlines, Inc., and represented by the Team- sters Union went on strike over new contract terms. The Air Line Pilots Association (ALPA), the exclusive bargaining represen- tative of Transamerica’s pilots, decided to honor Teamster picket lines, thereby grounding nearly all Transamerica’s flights. After a month of supporting the flight attendants, ALPA negotiated a back-to-work

agreement with Transamerica and returned to work. The agreement included a clause stating, “There shall be no reprisals or recriminations by either side as a result of activities during the strike.” After the pilots returned to work, ALPA initiated union dis- ciplinary action against pilots who had flown during the strike, ultimately fining them the amount of money they earned during the strike.

The fined pilots refused to pay and brought an action in federal district court claiming ALPA violated the “no reprisal” clause of the back-to-work agreement by fining them. ALPA sought to dismiss the federal court action by contending that the federal court did not have jurisdiction under the RLA to decide matters of contract interpretation.

Does the district court have jurisdiction? In which forum are contract interpretation disputes between ALPA and the carrier

19 Id. at 376, 377. 20 2005 NLRB LEXIS 451 (Aug. 27, 2005). 21 525 F.3d 862 (9th Cir. 2008).


resolved? [Frehtelkotter v. Air Line Pilots Association, 111 LRRM 3065 (9th Cir.)]

7. The Transport Workers Union of America represented flight attendants for Eastern Airlines. The collective bargaining agreement in effect between the union and Eastern included a clause requiring that “any and all” flying performed for Eastern would be performed by flight attendants named on the current Eastern Airlines seniority list. Subse- quently Eastern agreed to assume the Latin American service routes of the bankrupt Braniff Airways, Inc. Part of the agreement covering routes to eight Latin American countries included a provision requiring Eastern to hire approximately 310 flight attendants employed by Braniff who would reside in those countries to work the Latin American flights.

The union claimed Eastern had unilater- ally ignored the language of the collective bargaining agreement by employing flight attendants not listed on the seniority roster in violation of the RLA. The union sought a preliminary injunction restoring the flight attendant issue to the status quo pending a full trial. Eastern claimed the union was not entitled to an injunction under the RLA.

May the union obtain an injunction against Eastern under the Act? If so, should an injunction be issued? Decide. [Local 553 v. Eastern Airlines, 111 LRRM 2402 (E.D.N.Y.)]

8. The United Transportation Union (UTU), a representative of the employees of Burlington-Northern Railroad Company, notified the railroad of a new request gov- erning the compensation of train crews. The union requested that road or yard crews working without a fireman receive extra compensation and that firemen working with a reduced train or yard crew receive extra compensation. The carrier character- ized this request as improper and barred by a previous agreement with the union that imposed a moratorium on the change of payment for certain train crews. The union

maintained its request was not barred by the moratorium provision and invoked media- tion of the matter under the RLA. At medi- ation, the parties agreed to submit the issue of the moratorium clause to arbitration and, in the meantime, recess mediation. After the conference, however, the union asked if negotiations could be continued without submitting the moratorium issue to arbitra- tion. The railroad understood the union request to mean that the issue would not be submitted to arbitration, provided the UTU did not strike on that issue. On April 1, the National Mediation Board acknowledged that mediation was recessed with agreement of the parties. On April 13, the UTU struck Burlington-Northern over the crew pay- ments issue. On April 23, the railroad submitted the moratorium issue to arbitration.

Burlington-Northern sought an injunction prohibiting the union from striking over this issue. The UTU maintained its right to resort to a strike under the RLA.

What factors must be considered by the court before a strike injunction may be issued? Should an injunction be granted in this case? Decide. [Burlington-Northern Railroad v. UTU, 110 LRRM 2340 (N.D. Ill.)]

9. The International Association of Machinists filed a petition with the National Mediation Board calling for a Board investigation of a representation dispute among certain employees of British Airways. After eight days of hearings, the NMB found that among the employees in question, a craft or class of office-clerical employees existed that was distinct from a craft or class of fleet and passenger employees. Although the Machi- nists wanted to represent both classes of employees, the Board ruled they did not have sufficient support among the office class. The Board did rule that the fleet and passenger employees at British Airways were involved in a representation dispute and that they were entitled to an election. The Machinists


were subsequently certified as the represen- tatives of the fleet and passenger class.

The employer brought an action in U.S. district court alleging that the NMB improperly designated the fleet and passen- ger employees as a class or craft under the RLA because the NMB ignored evidence offered by British Airways that would have prevented this determination. The union claimed that the court should not have scrutinized the NMB process of determining a craft or class of employees under the RLA and sought to dismiss the action.

What factors must the NMB consider in determining classes or crafts under the Act? May the court overrule the NMB’s determination of a class or craft of employ- ees for representation purposes under the RLA in this case? Decide. [British Airways Board v. NMB, 109 LRRM 2527 (E.D.N.Y.)]

10. The International Brotherhood of Teamsters was the certified representative of Western Airline’s mechanics, stock clerks, and flight instructors. The Air Transport Employees’ Union represented Western’s clerical, office, fleet, and passenger service employees. Collective bargaining agreements in effect between the unions and Western provided that they were binding on Western’s succes- sors. After negotiations in which both unions agreed to significant wage concessions, the unions and Western executed letter agree- ments. These agreements provided that in the event of Western’s merger with or acquisition by another airline, Western would ensure that work performed by union employees would continue to be assigned to union employees and be covered by the collective bargaining agreements.

Two years later Delta Airlines and Western agreed to a merger. Under the agreement, Western would cease to exist on the following April 1. The agreement made no mention of whether Delta would recognize the unions or be bound by the collective bargaining agreements. Delta employees in the crafts

covered by Western’s collective bargaining agreements were nonunion.

Prior to the merger date, the unions filed grievances claiming that Western’s agree- ment to merge violated the collective bar- gaining agreements. Pursuant to the collective bargaining agreements, both unions requested arbitration to determine whether the agreements had been breached. Western refused to submit to arbitration, stating that arbitration should not be the vehicle for deciding who would represent Delta employees after the merger. Western argued that because the issues involved the unions’ representation status, they were not arbitral, but instead fell within the exclusive jurisdiction of the National Mediation Board.

Time is of the essence. What can the unions do next? May they proceed to court, or is this a representation matter within the exclusive province of the NMB? Decide. [Local 2702 v. Western Airlines, 125 LRRM 2153 (9th Cir.)]

11. The Pacific & Arctic Railway halted operations between Skagway, Alaska, and the Yukon Territory. The union filed grievances, and a three-member arbitration panel, consisting of a union member, a carrier member, and a neutral member, met to hear the grievances. On the evening of the first hearing day, the railroad’s attorney encountered the union member and the neutral member going out to dinner; the union member paid for the dinner. When the hearing resumed, the railroad’s attorney questioned the ex parte contacts. A heated discussion ensued, with the neutral member characteriz- ing the objection as “trivial.” An exchange between the neutral member and the attorney followed:

THE ARBITRATOR: Sir, I don’t care what your plans are. Now, will you stop interrupting the board? If you say you’re through, you’re through. MR. ROBINSON: I’m making a record. Are you preventing me from making a record?


THE ARBITRATOR: No, you can make no further record. MR. ROBINSON: I can make no further record? THE ARBITRATOR: As far as I’m con- cerned, you’ve said everything you can say.

The railroad withdrew from the hearing, and the neutral member continued the hear- ing with only the union present. Ultimately, the neutral member totally disregarded the carrier’s arguments and decided the grievance in favor of the union. A second hearing was held in Skagway on another grievance. The railroad again refused to participate. After a short hearing, the neutral member and union member stayed in the area for several days and went on fishing trips together and took their meals together. The neutral member again ruled in favor of the union.

The carrier contended that the arbitration awards should be set aside because the con- duct of the neutral member amounted to the functional equivalent of fraud.

The union contends that court decisions make clear that Congress specifically intended to keep railroad labor disputes out of the courts. It argues that arbitration is an informal process and that the hearing was conducted in a satisfactory manner. The union states that no evidence exists that the union member and neutral member ever discussed the matter they were arbitrating outside the hearing room.

On what grounds can a court set aside an arbitration award under the RLA? Why are the grounds for court review of arbitration awards so narrow? Decide. [Pacific & Arctic Railway v. United Transportation Union, 952 F.2d 1144 (9th Cir. 1991)]

12. ABX operates as a common carrier, deliv- ering packages and freight by air. ABX and the Airline Professions Association, IBT,

were parties to a collective bargaining agreement. In the fall of 1999, Bryon Russell, a pilot employed by ABX, applied for disability and benefits after he was diagnosed by his physician as suffering from “stress and anxiety.” Unwilling to rely solely on the diagnosis of Russell’s doctor, ABX insisted that Russell undergo an inde- pendent medical examination (IME) with Dr. Joseph Westermeyer. Russell complied, and Dr. Westermeyer found that he was suffering from conditions more severe than mere stress and anxiety and was unfit to fly. Dr. Westermeyer provided a full report to ABX and Russell began receiving disability benefits. He remained on disability leave until April 1, 2002, when he notified ABX of his readiness to return to work. Despite Russell’s presentation of a second-class medical certificate from the Federal Avia- tion Administration clearing him to fly, ABX’s flight management had concerns about whether Russell was in fact fit to fly an airplane. ABX therefore directed him to attend another IME by Dr. Westermeyer, which Russell refused to do.

The union filed a grievance on behalf of Russell, which complained that by requiring Russell to submit to an IME before returning to work, ABX violated the terms of the col- lective bargaining agreement between the parties. The union also sought injunctive relief in federal district court, claiming that ABX’s action violated the RLA by imposing new working conditions not authorized by the parties’ CBA. The district court held that the complaint raised a major dispute under the RLA, over which the court had jurisdiction, and granted summary judgment to the union. ABX appealed. Decide. [Airline Professionals Ass’n v. ABX Air, Inc., 400 F.3d 411 (6th Cir. 2005)]




4:1 Introduction

4:2 Historical Development

4:3 Administration

4:4 Procedures

4:5 Jurisdiction: Employers Under the Act

4:6 Agency Law, Independent Contractors, “Contingent” Workers

4:7 Jurisdiction: Employees Under the Act

4:8 Jurisdiction: Preemption

4:9 Majority Bargaining Rights

4:10 The Appropriate Bargaining Unit

4:11 Multiemployer Bargaining Units

4:12 Craft Severance

4:13 Determining Employees’ Choice

4:14 Election Conduct and Free Speech

4:15 Election Propaganda and Misrepresentations

4:16 Bargaining Rights Based on Authorization Cards

4:17 Remedial Powers



Today’s labor law is built on a framework of three federal statutes. Each of these statutes has an official title and a popular name. The National Labor Relations Act (NLRA), enacted in 1935, is frequently referred to as the Wagner Act. The Labor Management Relations Act (LMRA), enacted in 1947, is often called the Taft-Hartley Act. Title I of this Act continued a major portion of the Wagner Act, but also contained drastic changes. Title I of the LMRA is often referred to as “the National Labor Relations Act, as amended.” The Labor-Management Reporting and Disclosure Act (LMRDA), enacted in 1959, is also known as the Landrum- Griffin Act. A major purpose of this law is to protect union members from improper conduct by union officials. Title VII of this Act also amended certain sections of the NLRA, and these amendments are commonly referred to as “the Landrum-Griffin amendments to the NLRA.” Chapter 9 of this book presents cases and text concern- ing the LMRDA as it relates to regulation of internal union conduct.


Building on the experience of the Railway Labor Act, Congress enacted the National Industrial Recovery Act (NIRA) in 1933. This law was the first in a series of President Franklin D. Roosevelt’s New Deal enactments designed to lift the nation out of the Great Depression of the 1930s. The NIRA suspended the anti- trust laws to permit employers within single industries to form trade associations that set production quotas and fixed prices under Codes of Fair Competition. To encourage participation by unions, Section 7(a) of the NIRA gave employees the right to organize without employer interference, stating that

employees shall have the right to organize and bargain collectively through representa- tives of their own choosing, and shall be free from the interference, restraint, or coercion of employers of labor, or their agents, in the designation of such representatives or in self-organization or in other concerted activities for the purpose of collective bargaining or other mutual aid or protection; …

This declaration had a profound impact. Unions used it as a basis for telling unorganized workers that President Roosevelt wanted them to join a union. And many employers refused to recognize newly formed unions, leading to many strikes for union recognition. As a result, President Roosevelt created the National Labor Board to ensure compliance with Section 7(a) and to mediate controversies under the NIRA. That board, however, lacked any meaningful power.

Faced with mounting labor disputes, in June 1934, Congress passed a joint resolu- tion authorizing the president to establish a new board as a part of the NIRA, called the National Labor Relations Board, and later known as the “Old NLRB.” This board had the authority to investigate disputes arising under Section 7(a) and to conduct secret ballot representation elections. However, it lacked real power to enforce Section 7(a). In May 1935, when the NIRA was declared unconstitutional by the Supreme Court in Schechter Poultry Corp. v. United States,1 the Old NLRB went out of existence.

1 295 U.S. 495 (1935).



Undeterred by the adverse decision in Schechter Poultry, Congress enacted a com- prehensive labor code on July 5, 1935, called the National Labor Relations Act (popularly called the Wagner Act after its chief legislative sponsor, Senator Robert F. Wagner of New York). In drafting this legislation, Congress drew heavily upon experience secured under the Railway Labor Act of 1926 and Section 7(a) of the NIRA, hoping that by so doing, it would avoid an adverse constitutional interpre- tation by the Supreme Court. The National Labor Relations Act was grounded in the federal government’s power, granted in Article I, Section 8, of the Constitution, to regulate interstate commerce. The Act was designed so that the secret ballot election would take the place of the recognition strike.

The two most significant portions of the National Labor Relations Act of 1935 were Sections 7 and 8. The substantive rights of employees were stated in Section 7 as follows:

Employees shall have the right to … form, join, or assist labor organizations, to bar- gain collectively through representatives of their own choosing, and to engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection.…

The rights granted by Section 7 were protected against employer interference by Section 8, which listed the following five employer unfair labor practices:

1. Interference with efforts of employees to form, join, or assist labor organiza- tions or to engage in concerted activities for mutual aid or protection;

2. Domination of a labor organization (which outlawed the company-formed or company-assisted labor union);

3. Discrimination in hiring or tenure to influence union affiliation or discourage union activities;

4. Discrimination for filing charges or giving testimony under the Act; and 5. Refusal to bargain collectively with a duly designated representative of the


Employers immediately undertook action to have the new law reviewed by the Supreme Court in an effort to have it declared unconstitutional for, among other things, being in excess of federal power to regulate interstate commerce. The classic case on this issue is National Labor Relations Board v. Jones & Laughlin Steel Corp., which is presented in this section. The constitutionality of the law was upheld by a 5–4 decision.

The labor movement secured phenomenonal growth and strength because of the broad protection of Sections 7 and 8 of the 1935 Act.


During the years that the original NLRA was in effect, it was subjected to continu- ous attack by employer groups. They argued that legislative sponsorship of labor unions under the Wagner Act had, instead of restoring equality in bargaining power, served to tip the balance measurably in favor of labor.


In the context of numerous strikes and the fear that union power would lead to serious inflation after World War II, the Labor Management Relations Act of 1947, sponsored by Senator Robert Taft and Congressman Fred Hartley, Jr., became law after a veto by President Harry S. Truman was overridden. The Act created an independent NLRB General Counsel to be appointed by the president, with responsibility to act as prosecutor and to supervise board attorneys, while the five-person board would perform quasi-judicial functions under the law. New language was added to Section 7 providing that employees shall have the right to refrain from all of the activities listed in Section 7. It set forth six union unfair labor practices, declared the closed shop (an arrangement where by the employer had to hire only union members) to be illegal, and prohibited secondary boycotts. Section 301 of the LMRA granted federal courts jurisdiction to resolve disputes arising out of collective bargaining agreements. Under Section 303, employers were granted the right to sue unions for damages arising out of secondary boy- cotts, with recovery allowed only from union assets.


Public hearings in 1957 and 1958 by the Senate Select Committee on Improper Activities in the Labor Management Field, known by the name of its chairman John McClellan as the McClellan Committee, convinced Congress that legisla- tion was necessary to regulate the internal affairs of unions and eliminate cor- rupt practices. Accordingly, Congress passed the Labor-Management Reporting and Disclosure Act of 1959 (the Landrum-Griffin Act). The Act also amended the NLRA, by tightening the ban on secondary boycotts and adding a new union unfair labor practice, Section 8(b)(7), to outlaw extended picketing for recognitional purposes.


In 1974, the NLRA was amended to eliminate an exclusion in Section 2(2) of the Act for nonprofit hospitals and to create a new category of employer called “health care institution,” which included “any hospital, convalescent hospital, health maintenance organization, health clinic, nursing home, extended care facility, or other institution devoted to the care of sick, infirm and aged persons.”2 A new Section 8(g) was added to the NLRA, setting forth a special notice requirement that must be met before a union can picket or strike a health care institution.

2 29 U.S.C. § 152(14).



[The National Labor Relations Board found that Jones & Laughlin Steel Corporation had discharged 10 employees at its Aliquippa, Pennsylvania, plant because of their union activity and for the purpose of discouraging membership in the union. The Board ordered these employees reinstated with full back pay and ordered that the employer cease and desist from such conduct. When the employer failed to comply with the Board’s order, the Board petitioned the court of appeals to enforce the order. The court of appeals denied the petition, holding that the Board’s order lay beyond the range of federal power. The Supreme Court granted certiorari.]

HUGHES, C. J.… Effects of the unfair labor practice in respondent’s enterprise.—Giving full weight to respondent’s conten- tion with respect to a break in the complete continuity of the “stream of commerce” by reason of respon- dents’ manufacturing operations, the fact remains that the stoppage of those operations by industrial strife would have a most serious effect upon interstate commerce. In view of respondent’s far-flung activities, it is idle to say that the effect would be indirect or remote. It is obvious that it would be immediate and might be catastrophic…. When industries organize themselves on a national scale, making their relation to interstate commerce the dominant factor in their activities, how can it be maintained that their indus- trial labor relations constitute a forbidden field into which Congress may not enter when it is necessary to protect interstate commerce from the paralyzing consequences of industrial war? We have often said that interstate commerce itself is a practical concep- tion. It is equally true that interference with that com- merce must be appraised by a judgment that does not ignore actual experience….

The Act does not compel agreements between employers and employees. It does not compel any agreement whatever. It does not prevent the employer “from refusing to make a collective contract and hiring individuals on whatever terms” the employer “may by unilateral action determine.” The Act

expressly provides in Section 9(a) that any individual employee or a group of employees shall have the right at any time to present grievances to their employer. The theory of the Act is that free opportunity for negotiation with accredited representatives of employees is likely to promote industrial peace and may bring about the adjustments and agreements which the Act in itself does not attempt to compel…. The Act does not interfere with the normal exercise of the right of the employer to select its employees or to discharge them. The employer may not, under cover of that right, intimidate or coerce its employees with respect to their self-organization and representation, and, on the other hand, the Board is not entitled to make its authority a pretext for interference with the right of discharge when that right is exercised for other reasons than such intimidation and coercion. The true purpose is the subject of investigation with full opportunity to show the facts. It would seem that when employers freely recognize the right of their employees to their own organizations and their unre- stricted right of representation there will be much less occasion for controversy in respect to the free and appropriate exercise of the right of selection and discharge….

The order of the Board required the reinstate- ment of the employees who were found to have been discharged because of their “union activity” and for the purpose of “discouraging membership in the union.” That requirement was authorized by the Act. Section 10(c), 29 U.S.C.A. Section 160(c). In Texas & N.O.R. Co. v. Railway & S.S. Clerks, supra, a similar order for restoration to service was made by the court in contempt proceedings for the violation of an injunction issued by the court to restrain an interference with the right of employees as guaranteed by the Railway Labor Act of 1926. The requirement of restoration to service of employees discharged in violation of the provisions of the Act was thus a sanction imposed in the enforcement of a judicial decree. We do not doubt that Congress could impose a like sanction for the enforcement of its valid regulation. The fact that in the one case it was a judicial sanction, and in the




The National Labor Relations Board (NLRB) enforces the National Labor Rela- tions Act. Its two principal functions are (1) conducting secret ballot elections to determine whether a majority of employees want to be represented by a union (“representation cases”) and (2) preventing and remedying unfair labor practices that employers and unions commit. The NLRB carries out these functions through two independent offices: the Board and the Office of General Counsel.

The Board is a five-member body that is appointed by the president, with approval of the Senate, for five-year terms, the term of one member expiring each year.3 Although the Act is silent on the matter, a tradition has developed that the

other a legislative one, is not an essential difference in determining its propriety.

Our conclusion is that the order of the Board was within its competency and that the Act is valid as here applied. The judgment of the Circuit Court of Appeals is reversed and the case is remanded for fur- ther proceedings in conformity with this opinion.


Case Questions

1. What action did the Board take after investigation of the charges?

2. Did the court of appeals uphold the Board? On what ground?

3. Does the NLRA compel agreements between employers and employees?

3 The Congresses that enacted the Wagner Act and Taft-Hartley Act expected that the Labor Board members would be nonpartisan, neutral adjudicators of the disputes brought before them for resolu- tion. See James J. Brudney, The National Labor Relations Board in Comparative Context—Isolated and Politicized: The NLRB’s Uncertain Future, 26 COMP. LAB. L. & POL’Y J. 221, 243 (2005). Presi- dents Roosevelt and Truman filled appointments to the Board with nonpartisan appointees. Starting with President Dwight D. Eisenhower, appointment practices changed, and since 1970, a majority of appointments to the Board have come from management and union law practices rather than nonparti san and neutral backgrounds. In the second Reagan administration and into the George H. W. Bush administration, greater senatorial control over the appointment process occurred. Board appointments in both the George H. W. Bush and Clinton administrations tended to come in “package deals,” whereby Senate power brokers, in consultation with industry and labor interest groups, insisted that the president acquiesce to some of its specific choices as the price of the Senate confirming his Board nominee(s). Moreover, in both of these administrations and continuing in the George W. Bush (Bush II) administration, recess appointments have been utilized while the Senate and White House bargained over package deals. The Clinton Board was perceived by employer groups as providing greater protec- tions for workers than intended by the NLRA, and the Bush II Board was perceived by union leaders and many academicians as regularly denying or impairing the statutory rights it was charged with pro- tecting. With the adjournment of Congress in January 2008, the Bush II Board consisted of just two members. Wilma B. Liebman, a Democrat whose term expired August 27, 2011, and Chairman Peter C. Schaumber, a Republican whose term expired August 27, 2010. Due to senatorial tactics, no appointments were made to the Board until March 27, 2010, when two recess appointments were made by President Barack Obama. On January 3, 2012, the Board again consisted of two members, Chairman Mark Gaston Pearce (D) and Member Brian E. Hayes (R). On January 4, 2012, President Obama made three recess appointments to the Board, Sharon Block (D), Richard F. Griffin (D), and Terrance Flynn (R). Republicans claimed these appointments made during a recess of the Senate where pro forma sessions intended to prevent recess appointments were being held, were “shocking and unprecedented.” These appointments are being challenged in the courts. The nomination and appoint- ment process continues to be dysfunctional, with too many long-term vacancies and short-term recess appointments. One suggested remedy is that the NLRA be amended to allow members whose terms have expired to continue in office until their replacements are confirmed by the Senate.


president’s party will hold a 3:2 majority of appointments and the chair position. The Board acts as a quasi-judicial body, deciding appeals from the decisions of administrative law judges (ALJs).

Under Section 3(b) of the NLRA, the Board is authorized to delegate to any group of three or more members any and all of the powers that it may itself exercise. On December 20, 2007, the Board consisted of four members and they decided to delegate all of the Board’s powers to three members, effective December 28, 2007. They took this action knowing that the recess appointment of two members would expire on December 31, 2007 so that the remaining two members—Liebman and Schaumber—would have a quorum and be able to issue decisions and orders until the Board’s membership returned to at least three members. The Board functioned with just two members for 27 months, issuing almost 600 decisions, until President Obama made two recess appointments to the Board on March 27, 2010. In New Pro- cess Steel, LP v. NLRB, the Supreme Court ruled 5–4 that the two Board members did not have authority under Section 3(b) of the NLRA to issue the two-member deci- sions.4 Properly constituted Board panels of at least three members have reissued some 100 of the challenged two-member decisions. However, most of the parties to the 600 two-member decisions had already complied with the decisions.

The General Counsel of the Board is appointed for a four-year term by the president and approved by the Senate, with the following powers:

The general counsel is to have general supervision and direction of all attorneys employed by the Board, excluding the trial examiners [administrative law judges] and the legal assistants to the individual members of the Board, and of all the officers and employees in the Board’s regional offices, and is to have the final authority to act in the name of, but independently of any direction, control, or review by, the Board in respect of the investigation of charges (under Section 10) and the issuance of complaints of unfair labor practices, and in respect of the prosecution of such complaints before the board.5

Under the Taft-Hartley Act, Congress placed the functions of investigation and prosecution with the Office of the General Counsel and placed the quasi-judicial func- tions of deciding the merits of a controversy with the five-member Board.6 Under the Wagner Act, the NLRB had acted in the concurrent roles of investigator, prosecutor, and judge. The Taft-Hartley Act allows for independence of judgment on the part of the General Counsel; the General Counsel is responsible to the president and the Sen- ate and not to the National Labor Relations Board, as it had been formerly.

There are 32 regional offices, 3 subregional offices, and 17 resident offices of the NLRB located throughout the United States and its territories (See Figure 4.1). A regional director is in charge of every region, assisted by a staff of attorneys, field examiners, Board agents, and clerical personnel. All matters subject to the NLRA, except in unusual circumstances, must initially be filed with the regional director for the region in which the situation arose. In representation cases involving the NLRB’s

4 130 S. Ct. 2635 (2010). 5 House Rep. No. 510, 80th Congress, at 37, § 3(d) of the NLRA. 6 The National Labor Relations Board is variously referred to as the NLRB, the Board, and the Labor Board. The five-member quasi-judicial body is also known as the NLRB or the Board. The context of use indicates which entity is being referred to.



New Mexico

Delaware Maryland





South Dakota

North DakotaMontana


Colorado Utah



Alaska Hawaii Puerto Rico







New York Michigan

Vermont New Hampshire


Rhode Island



Ohio Indiana


North Carolina

South Carolina

Alabama Mississippi






New Jersey






9 25

13 730








West Virginia



6 5 4 22 29

2 34











17 14








* Houston regional office merged with Fort Worth. Houston became a resident office.

* Peoria regional office merged with St. Louis and is now a subregional office of Region 14.



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function of conducting secret ballot elections, the process is started by the filing of a petition with the regional director; in unfair labor practice cases the process is initi- ated by filing a charge with the regional director. The Board has delegated its authority over representation matters to the regional directors. The General Counsel has delegated authority to issue complaints in unfair labor practice cases to the regional directors. Thus, the Board has appellate jurisdiction over election decisions emanating from the regional offices, and the General Counsel has appellate authority over regional directors’ rulings on charges of unfair labor practices.

The formal hearing on an unfair labor practice complaint issued under the authority of the General Counsel is conducted by an administrative law judge ALJ.7 In unfair labor practice hearings, the administrative law judge functions very much like a trial court judge: hearing witnesses, ruling on admissibility of evidence, making findings of fact, and drawing conclusions of law. The administrative law judge’s decision may be appealed to the Board in Washington, D.C., by any party involved in the case. Administrative law judges are free from supervision by the Board. The Board appoints them based on merit from a civil service roster.


An individual who believes that an employer or a union is engaged in one or more unfair labor practices may file charges with the appropriate regional office of the National Labor Relations Board. A union or an employer may also file charges. The person or entity initiating the charge is called the charging party. Section 10(b) of the Act provides that the Board may not issue a complaint based on conduct that occurred more than six months before the filing and service of the charge. This six- month time limit for filing may be suspended, however, when the charging party did not have actual or constructive knowledge of the unfair labor practice when it occurred but filed within six months of obtaining knowledge of the conduct. After the charges are filed, the case is processed as follows (See also Figure 4.2).

1. The charges are investigated by a professional staff member. During this investigation, charges may be adjusted, withdrawn, dismissed, or otherwise closed without formal action.

2. A formal complaint is issued by the regional director if the charges are found to be well grounded and the case is not settled by adjustment.

3. A public hearing on the complaint is held before an administrative law judge. The case is prosecuted by an attorney from the regional staff, acting on behalf of the General Counsel.

4. The ALJ’s findings and recommendations are served on the parties and sent to the Board in Washington. At this point, the case is transferred to the Board in Washington. Unless either of the parties files a statement of exceptions to the judge’s finding within 28 days, the judge’s recommended order takes the full effect of an order by the Board. Parties who disagree with the judge’s findings

7 Until 1972, the title was trial examiner. Currently, there are 40 administrative law judges who hear cases nationwide, organized through 4 offices in Washington, D.C; Atlanta; New York City; and San Francisco.


may file a brief to support their exceptions and request oral argument before the Board. Exceptions are, in effect, an appeal from the administrative law judge’s decisions.

5. The Board reviews the case and issues a decision and an order. It is the Board’s policy not to overrule an ALJ’s credibility determinations unless the incorrectness is shown by a “clear preponderance of all the relevant evidence.”8


Regional director must ask district court for temporary restraining order in unlawful boycott and strike cases.


Filed with the NLRB regional director; alleges unfair labor practice by respondent.


Regional director determines whether formal action should be taken.


Regional director issues complaint and notice of hearing. Respondent files answer in 10 days.


NLRB finds respondent guilty of unfair labor practice and orders respondent to cease and desist.


Circuit court of appeals (CCA) enf- orces NLRB order or reviews app- eal by aggrieved party. Supreme Court reviews appeals from CCA.



Charge may be withdrawn before or after a complaint is issued. Regional director may refuse to issue a complaint; this refusal (dismissal of charge) may be appealed to the General Counsel. Settlement of case may occur at this point or at later stages (informal agreement subject to approval of regional director; formal settlement agreement executed simultaneously with or after issuance of complaint, subject to approval of Board).


Administrative law judge may grant motion to dismiss complaint. If so, appeal may be taken to the NLRB.


NLRB sends case back to regional director for further action.


Regional director may ask district court for temporary restraining order after complaint is issued in all cases of an unfair labor practice.


NLRB finds respondent not guilty of unfair labor practice and dismisses case.


Dismissal order may be appealed to the circuit court of appeals and from there to the Supreme Court.

Administrative law judge conducts hearing and files report recom- mending either (1) order to cease and desist from unfair labor prac- tice or (2) dismissal of complaint.



8 IUE Local 745 (McGraw Edison), 268 NLRB 308 (1983); but see Marshall Engineered Products Co., 351 NLRB No. 47, at 4 (Sept. 29, 2007).

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6. In case a union or an employer fails to comply with a Board order, the Board may ask the appropriate U.S. Court of Appeals for a judgment enforcing its order. Also, any party to the case who is aggrieved by the Board’s order may appeal to an appropriate U.S. Court of Appeals.

7. The Board or an aggrieved party may petition the Supreme Court of the United States to review the decision of the court of appeals. Failure to obey a final court judgment is punishable as civil or criminal contempt of court or both.

If the regional director refuses to issue a complaint, the charging party may appeal to the General Counsel’s Office of Appeals in Washington, D.C., where recommendations are made to the General Counsel, who has final authority over the issuance of complaints. If the General Counsel approves the decision not to issue the complaint, there is no further appeal. The General Counsel may, however, reverse the regional director’s decision and order that a complaint be issued.

The General Counsel’s authority over the issuance of complaints provides a legal basis, from time to time, for an activist role in presenting novel legal theories to the Board for adjudication.


Section 10(e) of the Taft-Hartley amendments of 1947 stipulates that “the findings of the Board with respect to questions of fact if supported by substantial evidence of record considered as a whole shall be conclusive.” Interpreting this language, the Supreme Court in Universal Camera Corp. v. NLRB said that a reviewing court may only set aside the Board’s findings on two fairly conflicting views on questions of fact “when it cannot conscientiously find that the evidence supporting that decision is substantial when viewed in the light that the record in its entirety furnishes, including the body of evidence opposed to the Board’s view.”9


In Chevron, U.S.A., Inc., v. Natural Resources Defense Council, Inc.,10 the Supreme Court set forth a rule of deference to administrative agencies in matters of statutory interpretation when U.S. courts of appeals are reviewing final orders of administrative agencies. If Congress has directly addressed the question at issue, the agency must give effect to this congressional intent. However, if the statute is silent or ambiguous on the question at issue, the agency’s formulation of policy and rules in filling statutory gaps will be upheld by the court as long as they are rational and consistent with the Act.

In determining whether the Board’s decisions are entitled to the deference announced in Chevron, courts nevertheless exercise some subjective leeway in their analysis to consider factors such as the quality of the Board’s reasoning, the rele- vancy of the Board’s experience, and the impartiality of the Board majority.

9 340 U.S. 474 (1951). 10 467 U.S. 837 (1984).



On the same day that the Supreme Court rendered the Jones & Laughlin decision, upholding the 1935 Act on all contested constitutional grounds and placing inter- state manufacturing operations within the scope of the federal commerce power, four companion cases were simultaneously handed down, all of which upheld the constitutionality and coverage of the Act.11 Thus, in one fell swoop, manufactur- ing, textiles, transport, and newspapers were included in the employer coverage. Jurisdiction of the Board, however, is still based on Sections 2(6) and (7) of the Act. The term commerce is defined in Section 2(6) and the term affecting commerce in Section 2(7). The broadness of the latter is herein indicated: “The term ‘affecting commerce’ means in commerce, or burdening or obstructing commerce or the free flow of commerce, or having led or tending to lead to a labor dispute burdening or obstructing commerce or the free flow of commerce.” Purely local activities are not under the jurisdiction of the National Labor Relations Board.

The term employer is defined by Section 2(2). This section excludes from the Act’s coverage the following employers:

1. Federal, state, or municipal corporations 2. Federal Reserve banks 3. Railroad companies under the Railway Labor Act, airlines, and related

companies 4. Labor organizations in their representation capacity but not in the capacity of

hiring their own employees

Although the interpretation of the jurisdictional provisions of the statute has given the NRLB broad authority, the Board has for reasons of administrative con- venience and policy exercised its authority only in situations falling within certain standards. First adopted and published in 1950, the standards have been revised from time to time.

In every Board proceeding, the first question investigated is the question of the Board’s jurisdiction. Once the existence of general authority over the subject matter is established, the Board then determines whether to proceed by ascertaining if the employer’s operations satisfy the following standards. In applying these standards, the Board considers the total operations of the employer, even though the particu- lar labor dispute may involve only a portion of those operations. The Board’s juris- dictional standards are as follows:

1. Nonretail businesses: Sales of goods to consumers in other states directly or indirectly through others (called outflow) of at least $50,000 a year or pur- chases of goods from suppliers in other states directly or indirectly through others (called inflow) of at least $50,000 a year.

2. Office buildings: Total annual income of at least $100,000 of which $25,000 or more is paid by other organizations that meet any of the standards except standard 1 (nonretail).

11 Associated Press v. NLRB, 301 U.S. 103;NLRB v. Friedman-Marks Clothing Co., 301 U.S. 58;NLRB v. Fruehauf Trailer Co., 301 U.S. 49; andWashington V&MCoach Co. v. NLRB, 301 U.S. 142 (1937).


3. Retail enterprises: At least $500,000 total annual volume of business. 4. Public utilities: At least $250,000 total annual volume of business. 5. Newspapers: At least $200,000 total annual volume of business. 6. Radio, telegraph, television, and telephone business: At least $100,000 total

annual volume of business. 7. Hotels and motels: At least $500,000 total annual volume of business.

(In 1967, the Board extended this yardstick to include jurisdiction over permanent or residential apartment houses with annual revenues meeting this standard.)

8. Taxicab companies: At least $500,000 total annual volume of business. 9. Transit systems: At least $250,000 total annual volume of business.

10. Transportation enterprises, links, and channels of interstate commerce: At least $50,000 total annual income from furnishing interstate transportation services or $50,000 or more from performing services for enterprises that meet any of the standards except the indirect outflow and indirect inflow standards estab- lished for nonretail businesses.

11. Associations: Regarded as single employers in that the annual business of all members is totaled to determine whether any of the standards apply.

12. Privately operated health care institutions: At least $250,000 total annual vol- ume of business for hospitals; at least $100,000 for nursing homes, visiting nurses’ associations, and related facilities; and at least $250,000 for all other types of private health care institutions defined in the 1974 amendments to the Act. The statutory definition includes “any hospital, convalescent hospital, health maintenance organization, health clinic, nursing home, extended care facility, or other institution devoted to the care of the sick, infirm, or aged person.” Public hospitals are excluded from NLRB jurisdiction by Section 2(2) of the Act.

Church-operated hospitals, including a hospital operated by the Seventh Day Adventist Church, are subject to the jurisdiction of the NLRB; exercising this jurisdiction is not in violation of the First Amendment or the Religious Freedom Restoration Act.12

13. Baseball: In 1969, the Board asserted jurisdiction over organized baseball. The case is reported in this section.

14. Nonprofit, private education institutions: In 1970, the Board asserted jurisdic- tion over private universities and colleges having annual operating expenses of at least $1 million. Professors classified as managerial employees are excluded from the protection of the Act.

15. U.S. Postal Service: The Board was empowered to assert jurisdiction over Postal Service employees under the Postal Reorganization Act (PRA) of 1970. Postal employees do not have the right to strike, however. Binding arbitration is provided for in Section 1207 of the PRA in the event of collective bargaining impasses.

12 332 NLRB No. 59 (2000).


In addition, the Board exercises jurisdiction over all enterprises that affect com- merce when their operations have a substantial impact on national defense. Also, all businesses in the District of Columbia come under the jurisdiction of the Board.

Ordinarily, if an enterprise does the total annual volume of business listed in the standard, it will necessarily be engaged in activities that “affect” commerce.

The Board has established the policy that when an employer whose operations affect commerce refuses to supply the Board with information concerning total annual business, the Board may dispense with this requirement and exercise jurisdiction.

Under its jurisdictional standards, the Board has applied the Act to such employers as law firms,13 accounting firms,14 the American Arbitration Associa- tion,15 and gambling casinos.16 The Board has exercised jurisdiction over Indian-owned casinos.17 The Board has declined jurisdiction in the horse-racing industry.18 However, the Board’s exercise of jurisdiction over jai alai players at the Volusia Jai Alai Palace in Daytona Beach was upheld by the court of appeals.19 In the racetrack cases, the Board declined jurisdiction because the rapid turnover of employees and the irregular nature of employment prevented effective regulation. However, jai alai players constituted a stable workforce with sufficient continuity to enable the Board to conduct meaningful elections. The Board also found that the jai alai players had a special need for union representation because their individual player contracts were printed in English, whereas almost all of the players were Spanish-speaking natives of Mexico or Spain who understood little or no English.

The Board has asserted jurisdiction over state banks owned by foreign govern- ments doing business in the United States, rejecting the argument that these banks are immune under the Foreign Sovereign Immunities Act.20

The Board has not taken jurisdiction over the real estate brokerage business, hold- ing it to be essentially local in nature.21 The Board was denied jurisdiction over lay teachers in “church-operated” schools by the Supreme Court in NLRB v. Catholic Bishop of Chicago, presented in this section. The Board has extended the Catholic Bishop decision to religious schools operated by lay boards of directors and

13 Foley, Hoag & Eliot, 229 NLRB 456 (1977); Kleinberg, Kaplan et al., 253 NLRB 450 (1980). 14 Ernst and Ernst National Warehouse, 228 NLRB 590 (1977). 15 American Arbitration Association, Inc., 225 NLRB 291 (1976). 16 El Dorado Club, 220 NLRB 291 (1975). 17 San Manuel Indian and Bingo Casino, 345 NLRB No. 79 (2005), enforced, 475 F.3d 1306 (D.C. Cir. 2007). See also Mashantucket Pequot Gaming dba Foxwoods Resort Casino v. UFCWV, Local 37, 356 NLRB No. 111 (March 17, 2011), certifying the UFCWV as the exclusive representative of employees at the Foxwood Resort. 18 Walter A. Kelley, 139 NLRB 744 (1962); Centennial Turf Club, 192 NLRB 698 (1971). 19 Florida Board of Business Regulation, Division of Pari-Mutuel Wagering v. NLRB, 686 F.2d 1362 (11th Cir. 1982). 20 State Bank of India v. NLRB, 808 F.2d 526 (7th Cir. 1986). 21 Seattle Real Estate Board, 130 NLRB 608 (1961).


administrators22 and church-operated colleges23 on a case-by-case basis, refusing to exercise jurisdiction over an employer if it would create a “significant risk of infringe- ment” of First Amendment rights.24


[The National Labor Relations Board exercised juris- diction over the lay faculty members at two Catholic high schools in the Chicago Diocese and exercised jurisdiction over five Catholic high schools in the Fort Wayne-South Bend Diocese. All of the high schools in question seek to provide a traditional secondary edu- cation, but oriented to the tenets of the Roman Cath- olic faith. Religious training is mandatory at all of the schools in question. The schools are certified by the states of Illinois and Indiana, respectively. The Board supervised elections for both groups of schools, and the unions prevailed. The Board certified the unions as the representatives of the lay teachers, but the schools declined to recognize or to bargain with the unions. Section 8(a)(5) unfair labor practice charges were brought by the unions and upheld by the Board. The Court of Appeals for the Seventh Circuit denied enforcement of the Board’s order. The Supreme Court granted certiorari.]

BURGER, C. J.… In recent decisions involving aid to parochial schools we have recognized the critical and unique role of the teacher in fulfilling the mission of a church-operated school. What was said of the schools in Lemon v. Kurtzman, 403 U.S. 602, 617 (1971), is true of the

schools in this case: “Religious authority necessarily pervades the school system.” The key role played by teachers in such a school system has been the predi- cate for our conclusions that governmental aid chan- neled through teachers creates an impermissible risk of excessive governmental entanglement in the affairs of the church-operated schools….

… Inevitably the Board’s inquiry will implicate sen- sitive issues that open the door to conflicts between clergy-administrators and the Board, or conflicts with negotiators for unions. What we said in Lemon applies as well here: “… parochial schools involve substantial religious activity and purpose.”

“The substantial religious character of these church- related schools gives rise to entangling church-state relationships of the kind the Religion Clauses sought to avoid.”Mr. Justice Douglas emphasized this in his con- curring opinion in Lemon, noting “the admitted and obvious fact that the raison d’̂etre of parochial schools is the propagation of religious faith.”

The church-teacher relationship in a church- operated school differs from the employment relation- ship in a public or other non-religious school. We see no escape from conflicts flowing from the Board’s exer- cise of jurisdiction over teachers in church-operated schools and the consequent serious First Amendment


22 Jewish Day School and AFT Local 3648, 283 NLRB 757 (1987). 23 Trustees of St. Joseph’s College, 282 NLRB 65 (1986). 24 In Carroll College Inc., 345 NLRB No. 17 (2005), the employer, a private liberal arts college located in Wisconsin and affiliated with the Presbyterian Church, did not contest the Board’s assertion of juris- diction. Thus, the Board did not apply its Catholic Bishop test to determine whether the exercise of jurisdiction over the employer involves a significant risk of infringement of religious rights that would exempt the entity from the NLRA. Rather, the college contended that it was exempt from coverage under the Religious Freedom Restoration Act (RFRA), 42 U.S.C. § 2000 bb-1 (2005). The Board rejected the college’s contentions under the RFRA because it did not meet the burden of proof of showing that the application of the act substantially burdened its ability to freely exercise its sincere religious beliefs in any way. Hypothetical or mere potential transgressions are not enough. But see, Ukiah Valley Medical Center, 332 NLRB 602 (2000), in which the Board dealt with Seventh Day Adventist religious practices that prohibit workers from belonging to or supporting labor unions.




An employer who acts in his or her own capacity and right does so as a principal and entails the full legal responsibility of a principal. When an employer acts through others who are given express or implied authority to act for the employer, the employer remains responsible as a principal because an agency relation has been cre- ated. This rule of imputed liability applies as long as the agent acts within the scope of express or implied authority. Acts of an agent beyond this authority are not imputable to the employer unless they are subsequently ratified by the employer.

The legal relation of independent contractor is that of a principal. An indepen- dent contractor contracts and performs independent acts. A contractor is liable for those acts as long as the contractor’s performance is free from the control or inter- vention of another person or entity.

The National Labor Relations Act introduces these concepts in three sections:

1. Section 2(2) provides: “The term ‘employer’ includes any person acting as an agent of an employer, directly or indirectly.”

2. Section 2(13) states: “In determining whether any person is acting as an ‘agent’ of another person so as to make such other person responsible for his

questions that would follow. We therefore turn to an examination of the National Labor Relations Act to decide whether it must be read to confer jurisdiction that would in turn require a decision on the constitu- tional claims raised by respondents.

There is no clear expression of an affirmative intention of Congress that teachers in church- operated schools should be covered by the Act. Admittedly, Congress defined the Board’s jurisdiction in very broad terms; we must therefore examine the legislative history of the Act to determine whether Congress contemplated that the grant of jurisdiction would include teachers in such schools.

In enacting the National Labor Relations Act in 1935, Congress sought to protect the right of American workers to bargain collectively. The concern that was repeated throughout the debates was the need to assure workers the right to organize to counterbalance the collective activities of employers which had been autho- rized by the National Industrial Recovery Act. But congressional attention focused on employment in private industry and on industrial recovery.

Our examination of the statute and its legislative history indicates that Congress simply gave no con- sideration to church-operated schools….


BRENNAN, J. (joined by WHITE, MARSHALL, and BLACKMUN, J. J.), Dissenting … The Court today holds that coverage of the National Labor Relations Act does not extend to lay teachers employed by church-operated schools. That construc- tion is plainly wrong in light of the Act’s language, its legislative history, and this Court’s precedents. It is justified solely on the basis of a canon of statutory construction seemingly invented by the Court for the purpose of deciding this case. I dissent….

Case Questions

1. Is religious training mandatory at all of the schools in question?

2. Does the Court see inevitable church-state entanglements if the Board were allowed to exercise jurisdiction over teachers in church- operated schools?

3. Did Congress express the clear intent to bring teachers in church-operated schools within the jurisdiction of the NLRA?


acts, the question of whether the specific acts performed were actually autho- rized or subsequently ratified shall not be controlling.”

3. Section 2(3) excludes independent contractors from the term employee.

A supervisor generally acts for and commits the employer. An employer can generally be relieved of liability if the unfair labor practices committed were those of an independent contractor rather than an agent or a joint employer. An employer remains jointly liable, however, if the employer procures the commission of an unfair labor practice by third persons over whom the employer retains express or covert power of control.


In NLRB v. United Insurance Co. of America, the Supreme Court held that Con- gress intended “the Board and the courts” to “apply the common-law agency test … in distinguishing an employee from an independent contractor” under the NLRA.25

The multifactor test developed under the common law of agency includes (1) the extent of control exercised over the details of the work by the employer, (2) whether the individual employed is in a distinct occupation or business, (3) whether the individual has an opportunity to make an entrepreneurial profit, (4) what skill is required of the worker, (5) whether the employer or worker supplies the tools and the place of work, (6) how long the person is employed, and (7) whether the work is a part of the regular business of the employer.

In Dial-a-Mattress Operating Corp.,26 applying the multifactor test, a Board majority held that the status of 39 owner-operators in the Long Island, New York, area weighed more heavily toward independent contractor status than employee status. The owner-operators did not wear uniforms, could use any vehicle, hired and trained their own employees and helpers, owned and had complete control over their own vehicles, had the opportunity to make an entrepreneurial profit, and could decline work without penalty.

In the Board’s 1998 Roadway Package System Inc.27 decision, the Board fol- lowed the Supreme Court’s United Insurance Co. directive to “apply the common- law agency test here in distinguishing an employee from an independent contractor.” The Board determined that the Roadway drivers were “employees” covered by the NLRA. FedEx Corp. of Memphis, Tennessee, acquired Roadway Package System, Inc., in 1998. FedEx Ground is the parent of FedEx Home Deliv- ery, and it continued the business model of “owner-operators” as independent con- tractors as utilized by Roadway.

In the Board’s Roadway decision, the employer argued that each driver had a proprietary interest in his service area and a right to sell to the “highest bidder,”

25 390 U.S. 254, 256 (1968). 26 Dial-a-Mattress Operating Corp. and IBT Local 363, 326 NLRB 884 (1998). 27 Roadway Package System Inc. and Teamsters Local 63, 326 NLRB 842 (1998).


allowing drivers to influence profits like entrepreneurs. However, the Board found that the four sales in question took place at Roadway’s behest, no gain was shown, and in a system of more than 5,000 drivers assigned to more than 300 terminals, these sales were insufficient to support a finding of independent contrac- tor status when weighed with other factors such as the drivers had to wear Road- way uniforms and own or lease custom-designed RPS vehicles, and would leave vehicles in the terminals overnight for loading. FedEx Home Delivery modified the Roadway business model somewhat, allowing some multiple routes to be con- trolled by a single contractor; allowing operators to sell or assign routes as the individual saw fit; and allowing some single operators to hire qualified replace- ments without the approval of FedEx.

In a subsequent representation dispute involving the FedEx terminals in Wilmington, Massachusetts, NLRB Regional Director Rosemary Pye found that the Wilmington drivers were employees under the NLRA, not independent contractors, because the company “exercise[d] substantial control” over how drivers perform their jobs, the vehicles had to display a company logo, drivers had to wear a company uniform, and the company “unilaterally establishe[d] the rates of compensation.” Following this determination, Teamsters Local 25 won a representation election with 24 single-route drivers voting for representation and 8 against. FedEx refused to bargain with the union, and the Board determined that FedEx had violated Sections 8 (a)(1) and 8(a)(5) of the NLRA. The matter progressed to the U.S. Court of Appeals for the D.C. Circuit, where a divided three-judge panel ruled that the drivers were independent contractors rather than employees.28 The appeals court majority noted a shift in emphasis in court decisions toward the key question of “whether the position presents opportunities and risks inherent in entrepreneurialism,” and it focused primar- ily on this factor in its analysis, including the ability to operate multiple routes, hire additional drivers, and sell routes. The dissent pointed out that the Board had properly applied the United Insurance Co. multifactor common law agency test and concluded that the drivers were company employees. The dissent disagreed that the common law test had evolved to a one-factor test that can be satisfied by showing a few examples, or even a single instance, of a driver seizing an entrepreneurial opportunity.29


The misclassification of workers as independent contractors rather than employees has adverse implications for the employees, competing employers, and the govern- ment. Misclassification of employees as independent contractors deprives the employees of their rights under the NLRA to form a labor organization with fellow

28 FedEx Home Delivery, Operating Division of FedEx Ground Inc. v. NLRB, 563 F.3d 492 (D.C. Cir. 2009). 29 The dissenting judge is referring to the majority’s very limited examples of entrepreneurial opportu- nity at Wilmington: 32 single-route drivers voted in the NLRB election, and in the history of its opera- tions there 2 drivers were able to sell their trucks and routes for a profit based on “murky” data for as high as $6,000 and $16,000 or as low as $3,000 or $12,000; 2 drivers incorporated; and 1 driver negotiated with FedEx for higher fees, in a context where FedEx assigned routes without a fee and could reconfigure routes if a driver did not provide adequate service.


employees, and negotiate a collective bargaining agreement that could provide seniority rights, wages, vacation and holiday pay, medical and retirement benefits, and protection against unjust discipline or discharge. Moreover, misclassification deprives these employees of the protection of wage and hour laws, and time- and-one-half rates for overtime work; it also denies them eligibility for unemploy- ment insurance coverage, workers’ compensation protection, and statutory rights under the antidiscrimination laws.

Employers who pay workers’ compensation and unemployment insurance pre- miums for their employees as required by law and pay overtime rates under the Fair Labor Standards Act are placed at a competitive disadvantage compared to employers who misclassify their employees. Finally, states are deprived of payroll taxes and unemployment and workers’ compensation taxes.30


There is growing awareness that contingent workers—including independent con- tractors, on-call workers, temporary-help-agency workers, and contract-company employees—make up an ever-increasing portion of the nation’s labor force.31

There is evidence that contracting or leasing of employees is being used to evade

30 FedEx Ground is facing broad legal challenges to its independent contractor system, though it believes that its drivers are properly classified. A multidistrict litigation case (MDL), in which FedEx Ground Package System drivers from 25 states sought, in individual lawsuits, to receive the benefits of being classified as employees, and believe the various states’ laws support the conclusion that they were employees of FedEx, was decided by a federal district court judge in Indiana mostly in favor of FedEx that they were independent contractors. See FedEx Ground Litigation, 2010 U.S. Dist. LEXIS 134959. The drivers sought reimbursement of business expenses and back pay for overtime and other wages. Twelve cases have been remanded for resolution of state court issues. The drivers in the Kentucky case were independent contractors under common law but employees for purposes of the Kentucky Wage Payment statute. The drivers were independent contractors under New Hampshire common law but employees under state law. In Nevada, the drivers were statutory employees under state law.

Under the Illinois Wage Act definition of employee, there is an exclusion for any person whose work is performed outside the employer’s usual course of business or place of business. The federal district court judge pointed out that FedEx required the drivers to wear FedEx uniforms and drive trucks displaying the FedEx logo; he cited testimony by FedEx officials that drivers are the “center- piece” of FedEx’s workforce and an “essential component” of the company’s business. They worked within the usual course and place of business, as FedEx required drivers to pick up their packages at the FedEx terminal and follow a delivery list, and any replacement drivers they hired were subject to company approval. In addition, the court noted that FedEx managers accompanied each driver on two to four customer service rides each year to ensure that the drivers were complying with FedEx’s stan- dards. See In re Employment Practices Litigation; No. 3:05-MD-527 (N.D. Ind., May 28, 2010).

Facing years of appeals from MDL litigation, and the prospect of states amending their wage laws on the pattern of the Illinois Wage Act, which would make drivers employees under state law, FedEx Ground Package System is transitioning from an independent contractor system to an “independent service provider (ISP)” model, establishing independent incorporated businesses that will contract with FedEx Ground for the pickup and delivery of packages. This ISP model has already been implemented in New Hampshire and currently is being established in Maryland. FedEx Ground has agreed to pay Massachusetts more that $3 million to settle a dispute over the alleged misclassification of its drivers as independent contractors. Without admitting liability, it will make payments to the state for payroll taxes, workers’ compensation, and unemployment insurance. 31 See


the letter and spirit of labor laws.32 The “Dunlop Commission” on the Future of Worker-Management Relations set forth findings in 1994 that some may say are still valid today:

The growing number of “contingent” and other non-standard workers poses the prob- lem of how to balance employers’ needs for flexibility with workers’ needs for ade- quate income protections, job security, and the application of public laws that these arrangements often preclude, including labor protection and labor-relations statutes.


Because one of the major policy objectives of the National Labor Relations Act is the protection of those employee, organizational rights guaranteed by Section 7, the definition of the term employee, embodied in Section 2(3), becomes a matter of prime importance.

Section 2(3), the definitions section of the NLRA, states:

The term “employee” shall include any employee, and shall not be limited to the employees of a particular employer, unless this subchapter explicitly states otherwise, and shall include any individual whose work has ceased as a consequence of, or in connection with, any current labor dispute or because of any unfair labor practice, and who has not obtained any other regular and substantially equivalent employment, but shall not include any individual employed as an agricultural laborer, or in the domestic service of any family or person at his home, or any individual employed by his parent

32 See Yvonne Abraham, Building Industry Wages Probed: Immigrant Labor Scheme Alleged, BOSTON SUNDAY GLOBE, Nov. 27, 2005, at 1, B5. This article reports a scheme set up to lower employer costs and increase profits while giving employers “plausible deniability.” Phase I, a construction company, accepts a building project and employs subcontractors to complete the construction. All income and expenditures of this company are reported for taxes to the IRS. Phase II, the subcontracting company, receives payment from the construction company and pays certain lead employees as “independent contractors.” The subcontractor reports to the IRS all income and expenditures including payments to lead workers deemed independent contractors. Phase III, each lead worker, misclassified as an indepen- dent contractor, receives payments from the subcontractor and keeps his wages and passes the rest on to men working under him, who are often undocumented workers and are not reported as employees of any of the principal companies. At Phase III, no income is reported to the IRS, no workers’ compen- sation insurance is provided, and no overtime wages are paid. The article reveals that some 30 percent of construction workers in the state were misclassified, according to the Center for Labor Market Stud- ies at Northeastern University.

A study by the Fiscal Policy Institute indicated that in New York City, 50,000 of the city’s 200,000 construction workers were employed “off the books” or misclassified as independent contrac- tors in 2005, avoiding employment laws and resulting in the loss of $272 million in unpaid payroll taxes as well as the loss of workers’ compensation, unemployment, and disability insurance premiums and $70 million in lost personal income taxes. DLR No. 236, at A-9 (Dec. 10, 2007).

In testimony before a U.S. Senate Committee considering the Employee Misclassification Preven- tion Act (S. 3254) (H.R. 5107), New York State Labor Commissioner Colleen Gardner reported that from September 2007 through March 2010, the New York State Joint Enforcement Task Force on Employee Misclassification identified almost 35,000 instances of employee misclassification, $457 mil- lion in unreported wages, $13.2 million in unpaid unemployment insurance taxes, and $14 million in unpaid wages. She cited studies estimating that 10.3 percent of New York state’s private-sector work- force and almost 15 percent of the state’s construction industry workforce are misclassified. Gayle Cinquegrani, Employee Misclassification Hurts Workers, Honest Employers, and the Public, Witnesses Say, DLR No. 116, at A-12 (June 18, 2010).


or spouse, or any individual having the status of an independent contractor, or any individual employed by an employer subject to the Railway Labor Act, as amended from time to time, or by any other person who is not an employer as herein defined.

In NLRB v. Town and Country Electric, Inc.,33 presented in this section, the Supreme Court held that the Board’s broad literal reading of the statutory defini- tion of “employee” set forth in Section 2(3) of the NLRA was entitled to consider- able deference, holding that paid union organizers can qualify as employees of a company and be entitled to the protections of the NLRA. Town & Country Elec- tric Co. had terminated a newly hired individual when it found out that he was also being paid by a union to help the union organize the company. In Lechmere, Inc., v. NLRB,34 the Supreme Court held that employers who enforce their no- solicitation rules cannot be compelled to allow nonemployee union organizers on their private property to distribute organizational literature. Because of the reduced access of outsider organizers to company property under the Lechmere rule, some unions are utilizing a strategy, based on the Town & Country decision, of “salt- ing” the workforces of companies that unions have targeted for organizational campaigns as outside organizers take employment with the targeted companies.

In the Board’s FES, a Division of Thermo Power35 decision, it established a framework for analyzing refusal-to-consider and/or hire cases by making clear the elements of the violation, the burdens of the parties, and the stage at which issues are to be litigated. To establish a discriminatory refusal-to-hire violation, the Gen- eral Counsel must, at the hearing on the merits, show (1) that the respondent was hiring, or had concrete plans to hire, at the time of the alleged unlawful conduct; (2) that the applicants had experience or training relevant to the announced or gen- erally known requirements of the positions for hire, or, in the alternative, that the employer has not adhered uniformly to such requirements or that the requirements were themselves pretextual or, were applied as a pretext for discrimination; and (3) that antiunion animus contributed to the decision not to hire the applicants. If established, the respondent-employer must show that it would not have hired the applicants even in the absence of their union activity or affiliation. In FES, the ALJ found that nine union pipefitter-applicants would have been hired as welders by FES but for the company’s antiunion animus and ordered back pay and instate- ment for each applicant; this order was adopted by the Board. The Third Circuit Court of Appeals enforced the Board’s order.36

In the September 29, 2007, Toering Electric Co. decision involving an overt salting case from 1996, where a union organizer submitted a batch of 18 resumes in response to a blind help-wanted ad for electricians and the employer made no

33 516 U.S. 85 (1995). In Starcom, Inc., v. NLRB, 161 LRRM 2233 (7th Cir. 1999), the Seventh Circuit enforced the NLRB’s cease-and-desist order against a contractor’s refusal to hire qualified union “salts,” but refused to enforce the Board’s remedial order because the Board had not demonstrated how many salters would have been hired but for the employer’s hostility toward unionization. 34 502 U.S. 527 (1992). 35 331 NLRB 9, 34 (2000). 36 NLRB v. FES (A Divsion of Thermo Power), 301 F.3d 83 (3d Cir. 2002). In Fluor Daniel, Inc. v. NLRB, 332 F.3d 961 (6th Cir. 2003), cert. den., 125 S. Ct. 964 (2005), the Sixth Circuit Court of Appeals approved the Board’s FES test for refusal-to-consider and/or hire cases.


response, the Board, with a 3–2 majority, materially altered its FES framework, imposing on the General Counsel, who is responsible for investigating charges and prosecuting complaints before the Board, the ultimate burden of proving in hiring discrimination cases that the alleged discriminatee had a genuine interest in seeking to establish an employment relationship with the employer. If this burden is met, the existing FES framework will apply.

The dissent pointed out that under this rule, if the General Counsel cannot prove that an applicant would have accepted a job offer from the employer, the applicant is not a statutory employee and there can be no violation of the Act and no remedy even if the employer’s refusal to hire or consider the applicant was motivated solely by antiunion animus. The dissent stated that the Board majority, without the benefit of briefs from interested parties, without oral argument, and without a request for it to reconsider the long-established precedent enduring over 170 hiring discrimination cases tried before the Board’s administrative law judges since the issuance of FES, legalized hiring discrimination involving salts in some cases.

As set forth in Section 2(3), the following workers are not protected by the Act:

1. Workers under the Railway Labor Act 2. Employees of employers not covered by the Act 3. Independent contractors 4. Domestic servants in the home 5. Persons employed by parents or spouses 6. Agricultural workers 7. Supervisors

The exclusion of workers under the Railway Labor Act follows the jurisdic- tional aspects of that Act as defined in Chapter 3 of this text. Of course, the employees of employers not covered by the law are similarly not covered. As set forth in the previous section, independent contractors are not covered by the Act. Domestic servants in the home are not covered by this federal legislation because of their lack of impact on interstate commerce.37 A condominium association’s argument that employees who performed various maintenance and cleaning ser- vices in individual units of owners were domestic employees excluded from cover- age under Section 2(3) of the Act was rejected by the Eleventh Circuit Court of Appeals. The court held that the employees’ relationship was no different from an employee performing similar work for apartment house or office building employers and therefore the Teamsters should be certified as the bargaining unit’s representative.38 In the interest of family harmony, persons employed by parents or spouses are not covered by the Act.39 A discussion of matters relating to agricul- tural workers and supervisory, managerial, and professional employees follows.

37 Ankh Services, Inc., 243 NLRB 478 (1979). 38 Shore Club Condominium Association v. NLRB, 400 F.3d 1336 (11th Cir. 2005). 39 See Winco Petroleum Co., 241 NLRB 1118 (1979), in which the Board looked beyond the corporate form of business organization in deciding that an employee-wife, whose husband was an officer and a majority stockholder in the employer corporation, was excluded from protection under the Act by Section 2(3), even though her employer was, technically speaking, the corporation.



Union-organizing activity among farmworkers has been accompanied by considerable strife, in part because there is no uniform statutory framework for the conduct of col- lective bargaining in the farm sector. Section 2(3) specifically excludes agricultural laborers from federal labor relations law. Thus, the regulation of labor relations in the farm sector is left to the individual states. Most states do not provide comparable protection and rights for agricultural workers. Agricultural workers are specifically excluded from the coverage of many state labor relations acts. However, Hawaii’s and Wisconsin’s state labor relations acts are broad enough to include farmworkers within the coverage of the acts. Also, the California Agricultural Labor Relations Act extends organization, representation, and collective bargaining rights to agricultural workers. The Massachusetts labor relations law provides coverage only where the employer has a permanent workforce of more than four agricultural workers, and the law expressly provides that it will not apply if a contract with migrant workers has been approved by the federal government. The Arizona Agriculture Employment Rela- tions Act has among its controversial features a ban on certain boycott activities; a restriction on use of consumer boycotts; and a restriction on harvest-time strikes by authorizing issuance of a 10-day injunction against a strike, with the condition, how- ever, that the dispute be submitted to binding arbitration.

Although agricultural laborers are clearly excluded from the Section 2(3) definition of employee, the Act does not define the term agricultural laborer. The Board and courts had significant difficulty interpreting the meaning of this exclusion until 1947, when Congress applied the Fair Labor Standards Act (FLSA) definition of agriculture to Board proceedings.


Although the NLRA excludes supervisors from the protections of the Act and managerial employees are excluded as a matter of Board policy, professional employees are an expressly covered category. Judgment and discretion are common functions to the status of each of these classifications, and expanded or adjusted definitions of statutory terms can have the effect of removing classes of workers from the rights and protections of the Act.40

SUPERVISORS. Section 2(3) of the NLRA excludes supervisory employees from the definition of employees protected by the Act. Section 2(11) of the Act defines “supervisor” as:

any individual having the authority, in the interest of the employer, to hire, transfer, sus- pend, lay off, recall, promote, discharge, assign, reward, or discipline other employees, or

40 The outcome of Board-conducted elections can be affected by the composition of the voting unit. Employers and unions aggressively pursue their legal options to obtain a voting unit that will most likely yield a favorable outcome from their respective points of view. A unit clarification hearing preceding a union election held before an NLRB hearing officer may resolve issues on who will be allowed to vote in the Board election. Whether certain individuals are excluded as supervisors or managerial, or are protected as professionals, may be pivotal to the outcome of the election and the rights of individual employees.


responsibility to direct them, or to adjust their grievances, or effectively to recommend such action, if in connection with the foregoing the exercise of such authority is not of a merely routine or clerical nature, but requires the use of independent judgment.

The text of Section 2(11) contains a three-part test for determining supervisory status. Employees fall within this statutory exclusion from coverage and rights under the Act if (1) they hold the authority to engage in or effectively recommend any one of the 12 listed supervisory functions (that is, hire, transfer, suspend, lay off, recall, promote, discharge, assign, reward, discipline other employees, responsi- bly direct them, or adjust their grievances); (2) their exercise of such authority is not merely routine or clerical in nature, but requires the use of independent judg- ment; and (3) their authority is held in the interest of the employer.41 The burden of proving supervisory status is on the party asserting that such status exists.42

In Oakwood Healthcare, Inc.,43 the Board examined whether 12 permanent acute care charge nurses at the Oakwood Heritage Hospital were statutory supervi- sors based on their role in assigning nursing personnel to patients and directing the nursing staff in the performance of their duties. The Board majority found that the 12 nurses were Section 2(11) supervisors because they had the authority to “assign” and exercised independent judgment in making these assignments in the interest of their employer. The Board majority adopted definitions for the terms assign, respon- sibly to direct, and independent judgment as those terms are used in Section 2(11) of the Act. It defined the term assign in sum as “designation of overall duties to an employee, not the ad hoc instruction that the employee perform a discrete task.” In addition to the term assign, the function of “responsibly to direct” is one of the 12 listed functions of supervisory status. While the Board found that the hospital did not meet its burden of proof that the charge nurses “responsibly directed”44

employees within the meaning of Section 2(11), nevertheless the nurses were still excluded as supervisors, because an employee need only perform one of the 12 enu- merated supervisory functions to fall within the supervisory exclusion. In explaining the definition of independent judgment in relation to the authority to “assign,” the Board stated that “[t]he authority to effect an assignment must be independent [free of the control of others], it must involve a judgment [forming an opinion or evaluation by discerning and comparing data], and the judgment must involve a degree of discretion that rises above the ‘routine or clerical.’”45

The Oakwood Healthcare dissent stated that the majority’s decision threatens to create a new class of workers under federal labor law: workers who have neither the genuine prerogatives of management nor the statutory rights of ordinary

41 Public Service Co. of Colorado v. NLRB, 405 F.3d 1071, 1076 (10th Cir. 2005) (citing Kentucky River, 532 U.S. at 711-12). 42 Dean & Deluca New York, Inc., 338 NLRB 1046, 1047 (2003). 43 Oakwood Healthcare, Inc., 348 NLRB No. 37 (Sept. 29, 2006). 44 In defining the term “responsibly to direct” with accountability, the Board stated “it must be shown that the employer delegated to the putative supervisor the authority to direct the work and the author- ity to take corrective action, if necessary. It also must be shown that there is a prospect of adverse con- sequences for that putative supervisor if he/she does not take these steps.” Id., slip op. at 7. 45 Id., slip op. at 8.


employees. It states that most professionals, who have some supervisory responsi- bilities in the sense of directing another’s work, fall into that category.

MANAGERIAL EMPLOYEES. Managerial employees are employees whose responsibilities to their employers are not such that they fit within the Section 2(11) definition of supervisory employees. Managerial employees are excluded from the coverage of the Act—not by explicit statutory language, but as a matter of Board policy. This policy received unanimous approval in the Supreme Court’s NLRB v. Bell Aero- space Co. decision.46 The Court defined managerial employees as “those who for- mulate, determine, and effectuate an employer’s policies.”47

PROFESSIONAL EMPLOYEES. Professional employees are within the protection of the Act. Section 2(12) of the Act sets forth a definition of professional employee:

any employee engaged in work (i) predominantly intellectual and varied in character as opposed to routine mental, manual, mechanical, or physical work; (ii) involving the consistent exercise of discretion and judgment in its performance; (iii) of such a charac- ter that the output produced or the result accomplished cannot be standardized in rela- tion to a given period of time; (iv) requiring knowledge of an advanced type in a field of science or learning customarily acquired by a prolonged course of specialized intel- lectual instruction and study in an institution of higher learning or a hospital, as distin- guished from a general academic education from an apprenticeship or from training in the performance of routine mental, manual, or physical processes….

Examples of professional employees are engineers, physicians, nurses, repor- ters, and symphony orchestra musicians.

The issue of whether full-time faculty members are “professional employees” covered by the Act or “managerial employees” excluded from the rights and pro- tection of the Act was considered by the Supreme Court in NLRB v. Yeshiva Uni- versity, presented in this section. In a 5–4 decision, the Court ruled that the faculty members were managerial employees. The NLRB makes its determination on the managerial status of faculty members on a case-by-case basis.48 The Board does not consider part-time faculty at private universities to be managerial employees and has determined that part-time faculty may constitute an appropriate unit for collective bargaining.49

At the same time Congress acted to exclude supervisors from the NLRA’s pro- tection, it explicitly extended those same protections to professionals. The inclusion of professionals and the exclusion of supervisors give rise to some tension in the statutory text of the Act. However, in NLRB v. Kentucky River Community Care, Inc.,50 a 5–4 Supreme Court majority ruled that the test for supervisory status set

46 416 U.S. 267 (1974). 47 444 U.S. 672, 103 LRRM 2526 (1980). 48 See Loretto Heights College v. NLRB, 742 F.2d 1245 (10th Cir. 1984) (faculty, not managerial); Trustees of Boston University, 281 NLRB 110 (1986) (faculty found to be managerial); LeMoyne- Owen College, 345 NLRB No. 93 (2008) (faculty found to be managerial employees and excluded from coverage under the Act). 49 University of San Francisco, 265 NLRB 571 (1982). 50 532 U.S. 706 (2001).


forth in Section 2(11) of the Act applies no differently to professionals than to other employees. It rejected the Board’s determination that nurses were not supervi- sors within the meaning of the NLRA, despite their direction of patient care by nurse’s aides, based on a statutory interpretation that the nurses do not use “inde- pendent judgment” as referenced in Section 2(11) when they exercise “ordinary professional or technical judgment in directing less skilled employees to deliver services in accordance with employer-specified standards.” As a result, the Board’s order to the Kentucky mental health care facility to include six registered nurses in a bargaining unit was not enforced.


[Town & Country Electric, Inc., a nonunion electrical contractor, wanted to hire licensed Minnesota electri- cians for construction work at a paper mill in Inter- national Falls, Minnesota. Town & Country, through an employment agency, advertised for job applicants, but it refused to interview 10 of 11 union applicants who responded to the advertisements. Its employment agency hired one union applicant whom Town & Country interviewed, but he was dismissed after three days on the job.

The 11 members of the union, the International Brotherhood of Electrical Workers, filed charges with the National Labor Relations Board claiming that Town & Country and the employment agency had refused to interview or retain them because of their union membership. The National Labor Rela- tions Board, in the course of its decision, determined that all 11 job applicants, including 2 union officials and the 1 member briefly hired, were “employees” as the Act defines that word. The Board recognized that under well-established law, it made no difference that the 10 members who were simply applicants were never hired. Moreover, the Board concluded with respect to the meaning of the word employee that it did not matter that the union members intended to try to organize the company if they secured the adver- tised jobs, nor that the union would pay them while they went about their organizing.

The U.S. Court of Appeals for the Eighth Circuit reversed the Board, holding that the Board had incor- rectly interpreted the statutory word employee. In the court’s view, the term employee does not cover those who work for a company while a union simulta- neously pays them to organize that company. Because this determination was in conflict with decisions by

the District of Columbia Circuit and the Second Cir- cuit, the Supreme Court granted certiorari to resolve the conflict.]

BREYER, J.… The National Labor Relations Act seeks to improve labor relations (“eliminate the causes of certain sub- stantial obstructions to the free flow of commerce,” 29 U.S.C. § 151 (1988 ed.)) in large part by granting specific sets of rights to employers and to employees. This case grows out of a controversy about rights that the Act grants to “employees,” namely, rights “to self-organization, to form, join, or assist labor orga- nizations, to bargain collectively … and to engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection.” § 157. We granted certiorari to decide only that part of the controversy that focuses upon the meaning of the word “employee,” a key term in the statute, since these rights belong only to those workers who qualify as “employees” as that term is defined in the Act. See, e.g., § 158(a)(1) (“unfair labor practice” to “interfere with … employees in the exercise of the rights guaranteed in Section 157 of this title”) (emphasis added).…

Several strong general arguments favor the Board’s position. For one thing, the Board’s decision is consistent with the broad language of the Act itself— language that is broad enough to include those com- pany workers whom a union also pays for organizing. The ordinary dictionary definition of “employee” includes any “person who works for another in return for financial or other compensation.” American Heri- tage Dictionary 604 (3d ed. 1992). See also Black’s Law Dictionary 525 (6th ed. 1990) (an employee is a



“person in the service of another under any contract of hire, express or implied, oral or written, where the employer has the power or right to control and direct the employee in the material details of how the work is to be performed”). The phrasing of the Act seems to reiterate the breadth of the ordinary dictionary defini- tion, for it says “[t]he term ‘employee’ shall include any employee.” 29 U.S.C. § 152(3) (1988 ed.) (emphasis added). Of course, the Act’s definition also contains a list of exceptions, for example, for independent contrac- tors, agricultural laborers, domestic workers, and employees subject to the Railway Labor Act, 45 U.S.C. § 151 et seq; but no exception applies here.

For another thing, the Board’s broad, literal inter- pretation of the word “employee” is consistent with several of the Act’s purposes, such as protecting “the right of employees to organize for mutual aid without employer interference,” …

Further, a broad, literal reading of the statute is con- sistent with cases in this Court such as, say, … Phelps Dodge Corp. v. NLRB, 313 U.S., at 185–186, … (job applicants are “employees”)….

Finally, at least one other provision of the 1947 Labor Management Relations Act seems specifically to contemplate the possibility that a company’s employee might also work for a union. This provision forbids an employer (say, the company) from making payments to a person employed by a union, but simultaneously exempts from that ban wages paid by the company to “any… employee of a labor organization,who is also an employee” of the company. 29 U.S.C. § 186(c)(1) (1988

ed., Supp. V) (emphasis added). If Town & Country is right, there would not seem to be many (or any) human beings to which this last phrase could apply….

… The company refers to a Union resolution per- mitting members to work for nonunion firms, which, the company says, reflects a union effort to “salt” nonunion companies with union members seeking to organize them. Supported by amici curiae, it argues that “salts” might try to harm the company….

… [T]he law offers alternative remedies for Town& Country’s concerns, short of excluding paid or unpaid union organizers from all protection under the Act…. A Company faced with unlawful (or pos- sibly unlawful) activity can discipline or dismiss the worker, file a complaint with the Board, or notify law enforcement authorities….

For these reasons the judgment of the Court of Appeals is vacated, and the case is remanded for fur- ther proceedings consistent with this opinion.

It is so ordered.

Case Questions

1. What factors did the Board rely on in making its decision?

2. Did the Supreme Court approve the NLRB’s rationale?

3. Did the Supreme Court offer direction to employers on how to deal with problems that could arise when dealing with paid union organizers as employees?


[Yeshiva University is a private university that con- ducts a broad range of arts and sciences programs at its five undergraduate and eight graduate schools in New York City. On October 30, 1974, the Yeshiva University Faculty Association (Union) filed a repre- sentation petition with the National Labor Relations Board (Board). The union sought certification as bar- gaining agent for the full-time faculty members at 10 of the 13 schools. The university opposed the petition on the grounds that all of its faculty members are managerial or supervisory personnel and hence not employees within the meaning of the National

Labor Relations Act (the Act). A Board-appointed hearing officer held hearings over a period of five months, generating a voluminous record.

The university administrative structure is similar to that of many private universities, with ultimate authority being vested in a board of trustees. Faculty power at Yeshiva’s schools extends beyond strictly academic concerns. The faculty at each school make recommendations to the dean or director in every case of faculty hiring, tenure, sabbaticals, termina- tion, and promotion. Although the final decision is reached by the central administration on the advice



of the dean or director, the overwhelming majority of faculty recommendations are implemented. In addi- tion, some faculties make final decisions regarding the admission, expulsion, and graduation of individ- ual students. Others have decided questions involving teaching loads, student absence policies, tuition and enrollment levels, and in one case the location of a school.

A three-member panel of the Board granted the union’s petition and directed an election in a bar- gaining unit consisting of all full-time faculty mem- bers at the affected schools. The Board concluded that the faculty are professional employees entitled to the protection of the Act because “faculty partici- pation in collegial decision making is on a collective rather than individual basis, it is exercised in the faculty’s own interest rather than in the interest of the employer, and final authority rests with the Board of Trustees.” The union won the election and was certified by the Board. The university refused to bargain, reasserting its view that the fac- ulty are managerial. The Board ordered the univer- sity to bargain. However, the court of appeals denied the enforcement petition. The Supreme Court granted certiorari.]

POWELL, J.… Managerial employees are defined as those who “for- mulate and effectuate management policies by expres- sing and making operative the decisions of their employer.” These employees are “much higher in the managerial structure” than those explicitly men- tioned by Congress, which “regarded [them] as so clearly outside the Act that no specific exclusionary provision was thought necessary.” Managerial employees must exercise discretion within or even independently of established employer policy and must be aligned with management. Although the Board has established no firm criteria for determining when an employee is so aligned, normally an employee may be excluded as managerial only if he represents management interests by taking or recom- mending discretionary actions that effectively control or implement employer policy.

The Board does not contend that the Yeshiva faculty’s decision making is too insignificant to be deemed managerial. Nor does it suggest that the role of the faculty is merely advisory and thus not managerial. Instead, it contends that the managerial exclusion cannot be applied in a straightforward fashion to professional employees because those

employees often appear to be exercising managerial authority when they are merely performing routine job duties….

The controlling consideration in this case is that the faculty of Yeshiva University exercise authority which in any other context unquestionably would be managerial. Their authority in academic matters is absolute. They decide what courses will be offered, when they will be scheduled, and to whom they will be taught. They debate and determine teaching methods, grading policies, and matriculation stan- dards. They effectively decide which students will be admitted, retained, and graduated. On occasion their views have determined the size of the student body, the tuition to be charged, and the location of a school. When one considers the function of a univer- sity, it is difficult to imagine decisions more manage- rial than these. To the extent the industrial analogy applies, the faculty determines within each school the product to be produced, the terms upon which it will be offered, and the customers who will be served.

The Board nevertheless insists that these decisions are not managerial because they require the exercise of independent professional judgment. We are not persuaded by this argument. There may be some ten- sion between the Act’s exclusion of managerial employees and its inclusion of professionals, since most professionals in managerial positions continue to draw on their special skills and training. But we have been directed to no authority suggesting that tension can be resolved by reference to the “indepen- dent professional judgment” criterion proposed in this case….

Moreover, the Board’s approach would under- mine the goal it purports to serve: To ensure that employees who exercise discretionary authority on behalf of the employer will not divide their loyalty between employer and union. In arguing that a fac- ulty member exercising independent judgment acts primarily in his own interest and therefore does not represent the interest of his employer, the Board assumes that the professional interests of the faculty and the interests of the institution are distinct, sepa- rable entities with which a faculty member could not simultaneously be aligned. The Court of Appeals found no justification for this distinction, and we perceive none. In fact, the faculty’s professional interests—as applied to governance at a university like Yeshiva—cannot be separated from those of the institution….



We certainly are not suggesting an application of the managerial exclusion that would sweep all professionals outside the Act in derogation of Con- gress’ expressed intent to protect them. The Board has recognized that employees whose decision mak- ing is limited to the routine discharge of professional duties in projects to which they have been assigned cannot be excluded from coverage even if union membership arguably may involve some divided loy- alty. Only if an employee’s activities fall outside the scope of the duties routinely performed by similarly situated professionals will he be found aligned with management. We think these decisions accurately capture the intent of Congress, and that they provide an appropriate starting point for analysis in cases involving professionals alleged to be managerial.*


BRENNAN, J. (joined byWHITE, MARSHALL, and BLACKMUN, J. J.), dissenting … [In their dissent, the Justices argue that the touchstone of managerial status is an alliance with management and the pivotal inquiry is whether the employee in performing duties represents the employee’s own interests or those of the employer. They criticize the majority, saying that the Court fails to understand that whatever influence the faculty wields in univer- sity decision making is attributable solely to their col- lective expertise as professional educators, and not to any managerial or supervisory prerogatives. They go on to state:]

… Finally, the Court’s perception of the Yeshiva faculty’s status is distorted by the rose-colored lens through which it views the governance structure of the modern-day university. The Court’s conclusion that the faculty’s professional interests are indistin-

guishable from those of the administration is bottomed on an idealized model of collegial decision making that is a vestige of the great medieval un- iversity. But the university of today bears little resem- blance to the “community of scholars of yesteryear.” Education has become “big business,” and the task of operating the university enterprise has been trans- ferred from the faculty to an autonomous administra- tion, which faces the same pressure to cut costs and increase efficiencies that confront any large industrial organization. The past decade of budgetary cutbacks, declining enrollments, reductions in faculty appoint- ments, curtailment of academic programs, and increasing calls for accountability to alumni and other special interest groups has only added to the erosion of the faculty’s role in the institution’s deci- sion making process.

These economic exigencies have also exacerbated the tensions in university labor relations as the faculty and administration more and more frequently find themselves advocating conflicting positions not only on issues of compensation, job security, and working conditions but even on subjects formerly thought to be the faculty’s prerogative. In response to this friction, and in an attempt to avoid the strikes and work stop- pages that have disrupted several major universities in recent years, many faculties have entered into collective bargaining relationships with their administrations and governing boards. An even greater number of schools— Yeshiva among them—have endeavored to negotiate and compromise their differences informally by establishing avenues for faculty input into university decisions on matters of professional concern.

Today’s decision, however, threatens to eliminate much of the administration’s incentive to resolve its disputes with the faculty through open discussion and mutual agreement….

[The dissent believes that the notion of a faculty member’s professional competence depending on undivided loyalty to management is antithetical to the whole concept of academic freedom.]

Case Questions

1. State the issue before the Supreme Court. 2. What was the Court’s decision on the issue? 3. Identify the faculty powers and functions that the

Court majority deemed “managerial decisions.” 4. What was the dissent’s view of the Court’s

perception of the status of the Yeshiva faculty?

*We recognize that this is a starting point only, and that other fac- tors not present here may enter into the analysis in other contexts. It is plain, for example, that professors may not be excluded merely because they determine the content of their own courses, evaluate their own students, and supervise their own research. There thus may be institutions of higher learning unlike Yeshiva where the fac- ulty are entirely or predominantly nonmanagerial. There also may be faculty members at Yeshiva and like universities who properly could be included in a bargaining unit. It may be that a rational line could be drawn between tenured and untenured faculty members, depend- ing upon how a faculty is structured and operates. But we express no opinion on these questions, for it is clear that the unit approved by the Board was far too broad.



The creation of federal labor legislation in the form of the NLRA raises the juris- dictional issue of whether employers and employees covered by the Act must look exclusively to the NLRB and the federal court system for redress or if they may seek an alternative state-created remedy in a state court. This issue is deceptively complicated and must be dealt with by reference to a legal concept that is derived from the “supremacy clause” of the U.S. Constitution and is referred to as the preemption doctrine.

The supremacy clause is found in Article VI, Section 2, of the Constitution, which states, “This Constitution and The Laws of the United States which shall be made in Pursuance thereof … shall be the supreme Law of the Land; and the judges in every State shall be bound thereby, anything in the Constitution or Laws of any State to the Contrary notwithstanding.” The preemption doctrine is a natu- ral extension of the supremacy clause and mandates that a state law cannot stand either where it is in direct conflict with a federal law or where there is evidence that Congress intended to foreclose state action in the particular area in question. Congressional preemptive intent can be established by express language in a statute or implied from either the pervasiveness of the federal law or the need for unifor- mity of regulation in the field.

With respect to the NLRA, the Supreme Court has held that the Act does not preempt all state laws and remedies in the area of labor relations. The Court stated in Garner v. Teamsters Local 77651 that the Act “leaves much to the states, though Congress has refrained from telling us how much. We must spell out from conflict- ing indications of Congressional will the area in which state action is permissible.”

In spelling out this congressional will, the Supreme Court has established a general rule for determining when preemption is appropriate and from this rule has carved out several key exceptions.


The general rule of preemption in the labor relations field was established in the land- mark Supreme Court decision in San Diego Building Trades Council v. Garmon, pre- sented in this section. In Garmon, the Court held that in the absence of an overriding state interest, such as that involved in controlling violence, state courts must defer to the exclusive competence of the NLRB in cases in which the activity that is the basis of the litigation is “arguably subject” to the protections of Section 7 or the prohibi- tions of Section 8 of the NLRA. The basic premise of this rule is that there is a clear need for uniformity of regulation in the field of labor relations. Allowing alternative state laws and remedies where the activity in question is “arguably subject” to Section 7 or 8 of the NLRA would unduly interfere with national labor policy.

In Sears Roebuck and Co. v. San Diego County District Council of Carpen- ters,52 an important case in which the Supreme Court upheld the application of

51 346 U.S. 485 (1953). 52 436 U.S. 180 (1978).


California’s trespass laws to picketing that was either arguably protected or argu- ably prohibited by Sections 7 and 8 of the NLRA, the Garmon rule was refined. The Court stated that the preemption inquiry cannot end with a determination that an activity is arguably subject to Section 7 or 8 of the Act for state action to be preempted. It must further be concluded that the legal theory or issue presented to the state court is very similar to that which could have been presented to the NLRB, thus creating an unacceptable risk of interference with the NLRB’s jurisdic- tion. It must also be found that the party who could have presented the issue to the NLRB had not done so and the other party had no acceptable means of doing so.


When the activity that is being litigated is a matter of overriding state interest, the courts have, in many instances, declined to apply the Garmon “arguably subject” rule of preemption and have allowed state action. Three areas in which state action has been consistently allowed are violence, libel, and fair representation. In Machi- nists, Lodge 76 v. Wisconsin Employment Relations Commission,53 the Supreme Court held that the states retain the power “to regulate conduct physically injuring or threatening injury to persons or property.” The Supreme Court sustained the jurisdiction of a state court to award damages in a civil action for libel instituted under state law by an employer subject to the NLRA in Linn v. United Plant Guard Workers, Local 114.54 The Court recognized “an overriding state interest” in protecting its residents from malicious libel. In Vaca v. Sipes55 the Supreme Court carved out a further exception to the Garmon preemption doctrine for cases involving a breach of a union’s duty of fair representation. In Vaca, the Court held that a state court did have jurisdiction in an action alleging breach of a collective bargaining agreement and seeking damages for a breach of a union’s duty of fair representation, even though the conduct complained of was arguably protected or prohibited by the NLRA.

In specific instances, Congress has expressly stated that state laws are not to be preempted because of federal labor legislation. The two most important examples are found in Section 301 of the LMRA and Section 14(b) of the NLRA. Under Sec- tion 301, federal and state courts have concurrent jurisdiction over suits for viola- tions of collective bargaining agreements, even though the conduct involved may be “arguably subject” to Section 7 or 8 of the NLRA. Section 14(b) of the NLRA specifically grants states the power to pass right-to-work laws. In Retail Clerks v. Schermerhorn,56 the Supreme Court upheld the right of a state to enforce such a law. The Court said, “Since it is plain that Congress left the States free to legislate in that field, we can only assume that it intended to leave unaffected the power to enforce those laws.”

53 427 U.S. 132 (1976). 54 383 U.S. 53 (1996). 55 386 U.S. 171 (1967). 56 375 U.S. 96 (1963).



A second preemption doctrine (in addition to the Garmon rule) exists based on the Supreme Court’s Machinists, Lodge 76 v. Wisconsin Employment Relations Commis- sion decision. The so-called Machinists preemption rule precludes state and municipal regulation concerning conduct that Congress intended to be unregulated. In Golden State Transit Corp. v. Los Angeles, presented in this section, the city of Los Angeles was found to have violated the Machinists’ rule. It interfered in a labor dispute between the Teamsters and a major taxi operator by conditioning the renewal of the operator’s franchise on settlement of the labor dispute, thus interfering with the nor- mal bargaining and self-help process contemplated by Congress under the NLRA.57

After the Supreme Court’s 1986 Golden State decision, the matter was returned to the district court on issue of whether the transit company could bring a “civil rights” damages suit under Section 1983 against the city. Both the trial court and the court of appeals concluded that the private employer had no right to compensatory damages. However, the Supreme Court reversed, holding that where a state (or city) attempts to abridge a personal liberty created by the National Labor Relations Act—the right to withstand a strike—a suit against the state under Section 1983 is viable.58

In Chamber of Commerce v. Brown, the Supreme Court found that a California statute prohibiting employers that receive state grants or funds of more than $10,000 per year from using any portion of these funds “to assist, promote or deter union organizing” is preempted by the NLRA under the Machinist preemption rule. Citing Golden State Transit, the Court stated, “[w]hat Congress left unregulated is as impor- tant as the regulations that it imposed.” The Court pointed out that noncoercive speech is protected by Sections 8(a) and 8(b) as well as Section 7 and Section 8(c) of the NLRA. The Chamber of Commerce case is presented in this section.

57 The NLRA does not preempt a municipality when it acts as a “market participant” in the further- ance of its proprietary interests as opposed to its regulatory interests, as determined in Building & Trades Council v. Associated Builders, 507 U.S. 218 (1993). 58 Golden State Transit Corp. v. City of Los Angeles, 493 U.S. 103 (1989).


[A union picketed an employer seeking an agreement by which the employer would retain only those work- ers who were union members or who applied for union membership within 30 days. The employer sought an injunction and damages in state court, both of which were granted. Concurrently, proceed- ings had been instituted before the NLRB. The Board, however, declined jurisdiction because the amount of

interstate commerce involved did not meet its mone- tary standards. On appeal, the state supreme court held that since the NLRB declined jurisdiction, the state courts had power over the dispute. The case reached the Supreme Court, which remanded it. On remand, the state supreme court set aside the injunc- tion but sustained the award of damages. Once again the case was appealed to the Supreme Court.]



FRANKFURTER, J…. In determining the extent to which state regulation must yield to subordinating federal authority, we have been concerned with delimiting areas of poten- tial conflict; potential conflict of rules of law, of rem- edy, and of administration. The nature of the judicial process precludes an ad hoc inquiry into the special problems of labor-management relations involved in a particular set of occurrences in order to ascertain the precise nature and degree of federal-state conflict there involved, and more particularly what exact mischief such a conflict would cause. Nor is it our business to attempt this. Such determinations inevita- bly depend upon judgments on the impact of these particular conflicts on the entire scheme of federal labor policy and administration. Our task is confined to dealing with classes of situations. To the National Labor Relations Board and to Congress must be left those precise and closely limited demarcations that can be adequately fashioned only by legislation and administration. We have necessarily been concerned with the potential conflict of two law-enforcing authorities, with the disharmonies inherent in two systems, one federal, the other state, of inconsis- tent standards of substantive law and differing reme- dial schemes. But the unifying consideration of our decisions has been in regard to the fact that Congress has entrusted administration of the labor policy for the Nation to a centralized administrative agency, armed with its own procedures, and equipped with its specialized knowledge and cumulative experience.

Congress did not merely lay down a substantive rule of law to be enforced by any tribunal com- petent to apply law generally to the parties. It went on to confide primary interpretation and application of its rules to a specific and specially constituted tribunal and prescribed a particular procedure for investigation, complaint and notice, and hearing and decision, including judi- cial relief pending a final administrative order. Congress evidently considered that centralized administration of specially designed procedures was necessary to obtain uniform application of its substantive rules and to avoid these diversities and conflicts likely to result from a variety of local procedures and attitudes towards labor controversies…. A multiplicity of tribunals and

diversity of procedures are quite as apt to pro- duce incompatible or conflicting adjudications as are different rules of substantive law….

When it is clear or may fairly be assumed that the activities which a State purports to regulate are pro- tected by Section 7 of the National Labor Relations Act, or constitute an unfair labor practice under Section 8, due regard for the federal enactment requires that state jurisdiction must yield. To leave the states free to regulate conduct so plainly within the central aim of fed- eral regulation involves too great a danger of conflict between power asserted by Congress and requirements imposed by state law. Nor has it mattered whether the states have acted through laws of broad general applica- tion rather than laws specifically directed towards the governance of industrial relations. Regardless of the mode adopted, to allow the states to control conduct which is the subject of national regulation would create potential frustration of national purposes.

At times it has not been clear whether the particu- lar activity regulated by the states was governed by Section 7 or Section 8 or was, perhaps, outside both these sections. But courts are not primary tribunals to adjudicate such issues. It is essential to the adminis- tration of the Act that these determinations be left in the first instance to the National Labor Relations Board. What is outside the scope of this Court’s authority cannot remain within a state’s power and state jurisdiction too must yield to the exclusive pri- mary competence of the Board.…

The case before us is such a case. The adjudication in California has throughout been based on the assumption that the behavior of the petitioning unions constituted an unfair labor practice. This con- clusion was derived by the California courts from the facts as well as from their view of the Act. It is not for us to decide whether the National Labor Relations Board would have, or should have decided these questions in the same manner. When an activity is arguably subject to Section 7 or Section 8 of the Act, the states as well as the federal courts must defer to the exclusive competence of the National Labor Relations Board if the danger of state interfer- ence with national policy is to be averted.

To require the states to yield to the primary juris- diction of the National Board does not ensure Board adjudication of the status of a disputed activity. If the



Board decides, subject to appropriate federal judicial review, that conduct is protected by Section 7, or pro- hibited by Section 8, then the matter is at an end, and the States are ousted of all jurisdiction. Or, the Board may decide that an activity is neither protected nor prohibited, and thereby raise the question whether such activity may be regulated by the States. How- ever, the Board may also fail to determine the status of the disputed conduct by declining to assert jurisdic- tion, or by refusal of the general counsel to file a charge, or by adopting some other disposition which does not define the nature of the activity with unclouded legal significance. This was the basic prob- lem underlying our decision in Guss v. Utah Labor Relations Board, 353 U.S. 1. In that case we held that the failure of the National Labor Relations Board to assume jurisdiction did not leave the states free to regulate activities they would otherwise be precluded from regulating. It follows that the failure of the Board to define the legal significance under the Act of a particular activity does not give the states the power to act. In the absence of the Board’s clear determination that an activity is neither protected

nor prohibited or of compelling precedent applied to essentially undisputed facts, it is not for this Court to decide whether such activities are subject to state jurisdiction. The withdrawal of this narrow area from possible state activity follows from our decision in Weber and Guss. The governing consideration is that to allow the states to control activities that are potentially subject to federal regulation involves too great a danger of conflict with national labor policy.


Case Questions

1. Why did the NLRB decline jurisdiction? 2. According to the Court, to which body did

Congress entrust the administration of national labor policy?

3. What is the basic premise behind the Court’s holding that the state courts must yield to federal law?

4. Does the failure of the Board to define the legal significance under the NLRA of a particular activity give the states the power to act?


[While Golden State’s application to renew its fran- chise to operate 400 Yellow Cab taxis in the city of Los Angeles was pending before the City Council, the taxi drivers represented by the Teamsters went on strike. At the Council meeting that evening and at later meetings, Teamster representatives argued against renewal because of the labor dispute. Thereafter the Council conditioned renewal of the franchise on settlement of the labor dispute by March 31. When the dispute was not settled by this date, the franchise expired. Golden State filed suit against the city, contending that the city’s action of conditioning the franchise renewal on settlement of the labor dispute was preempted by the NLRA, a

position rejected by the district court and affirmed by the court of appeals.]

BLACKMUN, J.… There is no question that the Teamsters and Golden State employed permissible economic tactics. The dri- vers were entitled to strike—and to time the strike to coincide with the council’s decision—in an attempt to apply pressure on Golden State…. And Golden State was entirely justified in using its economic power to withstand the strike in an attempt to obtain bargain- ing concessions from the union….

The parties’ resort to economic pressure was a legitimate part of their collective bargaining process



But the bargaining process was thwarted when the city in effect imposed a positive durational limit on the exercise of economic self-help. The District Court found that the council had conditioned the franchise on a settlement of the labor dispute by March 31. We agree with the Court of Appeals that this finding is amply supported by the record. The city’s insistence on a settlement is pre-empted if the city “[entered] into the substantive aspects of the bargaining process to an extent Congress has not countenanced.”

That such a condition—by a city or the Labor Board—contravenes congressional intent is demon- strated by the language of the NLRA and its legislative history. The NLRA requires an employer and a union to bargain in good faith, but it does not require them to reach agreement. Section 8(d) as amended … (duty to bargain in good faith “does not compel either party to agree to a proposal or require the making of a concession”) … (“The theory of the Act is that free opportunity for negotiation ….. may bring about the adjustments and agreements which the Act in itself does not attempt to compel”).

The Act leaves the bargaining process largely to the parties…. It does not purport to set any time limits on negotiations or economic struggle. Instead,

the Act provides a framework for the negotiations; it “is concerned primarily with establishing an equitable process for determining terms and condi- tions of employment.” … See also § 1, as amended, of the NLRA … (Act achieves national policy “by encouraging the practice and procedure of collective bargaining”)

… “[F]ederal law intended to leave the employer and the union free to use their economic weapons against one another.” Belknap, Inc. v. Hale, 463 U.S. at 500. We hold, therefore, that the city was preempted from conditioning Golden State’s fran- chise renewal on the settlement of the labor dispute….

The summary judgment entered for the city is reversed and the case is remanded for further pro- ceedings consistent with this opinion.

It is so ordered.

Case Questions

1. Summarize the essential facts of the case. 2. Did the city’s action add restrictions

where Congress intended that none should exist?


[Organizations whose members do business with the State of California, including the U.S. Chamber of Commerce, sued the state to enjoin enforcement of “Assembly Bill 1889” (AB 1889), which, among other things, prohibits employers that receive state grants of more than $10,000 in state program funds per year from using the funds “to assist, promote, or deter union organizing.” The district court granted the plaintiffs’ partial summary judgment, holding that the National Labor Relations Act preempts AB 1889 because it regulates employer speech about union organizing under circumstances in which Congress intended free debate. The Ninth Circuit reversed, concluding that Congress did not intend to

preclude states from imposing such restrictions on the use of their own funds. The Supreme Court agreed to hear the case.]

STEVENS, J.… Congress’ express protection of free debate forcefully buttresses the pre-emption analysis in this case. Under Machinists, congressional intent to shield a zone of activity from regulation is usually found only “implicit[ly] in the structure of the Act,” Liva- das v. Bradshaw, 512 U.S. 107, 117, n. 11 (1994), drawing on the notion that “‘[w]hat Congress left unregulated is as important as the regulations that it imposed,’” Golden State Transit Corp. v. Los



Angeles, 493 U.S. 103, 110 (1989) (Golden State II). In the case of non-coercive speech, however, the pro- tection is both implicit and explicit. Sections 8(a) and 8(b) demonstrate that when Congress has sought to put limits on advocacy for or against union organi- zation, it has expressly set forth the mechanisms for doing so. Moreover, the amendment to § 7 calls attention to the right of employees to refuse to join unions, which implies an underlying right to receive information opposing unionization. Finally, the addition of § 8(c) expressly precludes regulation of speech about unionization “so long as the commu- nications do not contain a ‘threat of reprisal or force or promise of benefit.’” Gissel Packing, 395 U.S., at 618….

In NLRA pre-emption cases, “‘judicial concern has necessarily focused on the nature of the activities which the States have sought to regulate rather than on the method of regulation adopted.’”… (“Pre-emption analysis … turns on the acutal content of [the State’s] policy and its real effect on federal rights”.).

… As the statute’s preamble candidly acknowl- edges, the legislative purpose is not the efficient procurement of goods and services, but the further- ance of a labor policy. See 2000 Cal. Stats. ch. 872, § 1. Although a State has a legitimate proprietary interest in ensuring that state funds are spent in accordance with the purposes for which they are appropriated, this is not the objective of AB 1889. In contrast to a neutral affirmative requirement that funds be spent solely for the purposes of the rele- vant grant or program, AB 1889 imposes a targeted negative restriction on employer speech about unionization. Furthermore, the statute does not even apply this constraint uniformly. Instead of forbidding the use of state funds for all employer advocacy regarding unionization, AB 1889 permits use of state funds for select employer advocacy activities that promote unions. Specifically, the statute exempts expenses incurred in connection with, inter alia, giving unions access to the work- place, and voluntarily recognizing unions without a secret ballot election. §§ 16647(b), (d)…

The statute also imposes deterrent litigation risks. Significantly, AB 1889 authorizes not only the California Attorney General but also any private taxpayer—including, of course, a union in a dispute with an employer—to bring a civil action against suspected violators for “injunctive relief, damages, civil penalties, and other appropri- ate equitable relief.” § 16645.8. Violators are liable to the State for three times the amount of state funds deemed spent on union organizing §§ 16645.2(d), 16645.7(d), 16645.8(a). Prevailing plaintiffs, and certain prevailing taxpayer interve- nors, are entitled to recover attorney’s fees and costs, § 16645.8(d), which may well dwarf the tre- ble damages award. Consequently, a trivial viola- tion of the statute could give rise to substantial liability….

… AB 1889’s enforcement mechanisms put con- siderable pressure on an employer either to forgo his “free speech right to communicate his views to his employees,” Gissel Packing, 395 U.S., at 617, or else to refuse the receipt of any state funds. In so doing, the statute impermissibly “predicat[es] bene- fits on refraining from conduct protected by federal labor law,” Livadas, 512 U.S., at 116, and chills one side of “the robust debate which has been pro- tected under the NLRA,” Letter Carriers, 418 U.S., at 275….

[Reversed and remanded.]

Case Questions

1. What is the meaning of the term “noncoercive speech” widely referenced in the Court’s opinion?

2. Preemption under the Machinists rule forbids both the NLRB and the states from regulating conduct that Congress intended “be unregulated and left to be controlled by the free play of eco- nomic forces.” How does the Machinist rule apply to the present case?

3. Does AB 1889 impose an equal restriction on employer and union speech about unionization?



Section 7 of the National Labor Relations Act guarantees employees the right to form, join, or assist labor organizations; to bargain collectively through representa- tives of their own choosing; and to engage in other concerted activity for the pur- pose of collective bargaining or other mutual aid or protection. Section 7 also guarantees employees the right to refrain from all of these activities, except to the extent that such right may be affected by a union security agreement as authorized by Section 8(a)(3) of the Act. The right of a group of employees to select or reject a bargaining representative through the secret ballot procedures set forth in Section 9 of the Act is the very heart of the NLRA.

The Board has delegated most of its authority over representation cases to the regional directors, retaining a limited right to review their decisions. Regional directors have the authority to:

1. Decide whether a question concerning representation exits 2. Determine appropriate bargaining units 3. Direct and conduct elections 4. Certify the results of elections 5. Rule on challenged ballots and objections to the election

In carrying out their responsibilities under the Act, regional directors, and the Board, when called upon to review regional directors’ decisions, must resolve many difficult questions concerning freedom of speech and electioneering activity, management conduct, and union activities. Individual employees and factions are protected against discriminatory treatment. After determination of the majority’s choice of a bargaining representative, all employees in the bargaining unit are sub- ject to uniform conditions and terms agreed to by the employer and the union, as set forth in their collective bargaining agreement.

The St. Barnabas Hospital and Local 1957, SEIU decision presents a profile of a regional director’s decision and direction of election.


St. Barnabas Hospital (“the Employer”), with a facil- ity located at 183rd Street and Third Avenue, Bronx, New York, herein its facility, is an acute care hospital and not-for-profit corporation providing medical ser- vices to the public.

Committee of Interns and Residents, Local 1957, SEIU, (“Petitioner”) filed this petition seeking to rep- resent all Interns, residents, and fellows employed by the Employer, but excluding all other employees, managers and guards and supervisors excluded under the Act. The Employer contends that the petitioned-for employees are students and thus no

question concerning representation can be raised. Upon a petition filed under Section 9(b) of the National Labor Relations Act, as amended, a hearing was held before a hearing officer of the National Labor Relations Board.

Pursuant to the provisions of Section 3(b) of the National Labor Relations Act, the Board has dele- gated its authority in this proceeding to the Regional Director, Region 2.…

I have considered the evidence and the arguments presented by the parties on this issue. As discussed below and based upon the stipulation of the parties,



I find the unit sought by the Petitioner is an appropriate unit. As to the issues presented at this hearing, I am bound to decide this case based on Board precedent.…

The Board’s decision inBostonMedical overruled… prior holdings concluding that interns and residents are, in fact, employees under the Act. The Board based its conclusions on the fact that interns and residents receive compensation in the form of a stipend, in addition to workers’ compensation, paid vacations, sick leave, and bereavement leave, health, dental, and life insurance, as well asmalpractice insurance. This established the finan- cial relationship these employees had with the hospital. The Board noted that residents spent up to 80 percent of their time at hospitals engaged in direct patient care. In dealing with the question that the Employer was also providing education and training, the Board held that merely because they receive on-the-job training did not negate their status as employees. Rather, the Board held that they are like apprentices learning production trades or professionals who continue to receive training after they are employed in order to maintain their licenses.…

I cannot find significant that the Employer has asserted minor and inconsequential differences in its training program from that in Boston Medical. The record here clearly establishes that residents perform the same major work functions for this Employer that were performed by the interns and residents at Boston Medical.…

Based on the record … considered as a whole, the Employer has failed to show… any supervisory author- ity that is vested in, and exercised by, the chief residents.

I therefore find that the following constitutes an appropriate unit for purposes of collective bargaining:

Included: All interns, residents, and fellows, includ- ing chief residents, employed by the Employer.

Excluded: All other employees, managers and guards and supervisors excluded under the Act.

Direction of Election An election by secret ballot shall be conducted by the Regional Director, Region 2, among the employees in the unit found appropriate at the time* and place set forth in the notice of election** to be issued

subsequently, subject to the Board’s Rules and Regula- tions. Eligible to vote are those in the unit who were employed at the payroll period ending immediately pre- ceding the date of this Decision, including employees who did not work during the period because they were ill, on vacation or temporarily laid off and all employees who meet the criteria described herein as of the date of this decision. Employees engaged in any economic strike, who have retained their status as stri- kers and who have not been permanently replaced are also eligible to vote. In addition, in an economic strike that commenced less than 12 months before the elec- tion date, employees engaged in such strike, who have retained their status as strikers but who have been per- manently replaced, as well as their replacements, are eligible to vote. Those in the military services of the United States who are in the unit may vote if they appear in person at the polls. Ineligible to vote are employees who have quit or been discharged for cause since the designated payroll period, employees engaged in a strike who have been discharged for cause since the commencement thereof and who have not been rehired or reinstated before the election date, and employees engaged in an economic strike which commenced more than 12 months before the election date and who have been permanently replaced.*** Those eligible shall vote whether or not they desire to be repre- sented for collective bargaining purposes by Committee of Interns and Residents, Local 1957, SEIU.

Case Questions

1. Must the Regional Director follow the precedents established by the Board, or may a Regional Direc- tor from time to time make a new and novel repre- sentation ruling with a regional perspective for consideration by the Board, if the ruling is appealed?

2. Read the Direction of Election statement of the Regional Director. Note how it deals with the appropriate bargaining unit and the Board’s Com- prehensive Rules and Regulations on eligibility to vote. What other important pre-election consid- erations are dealt with in the decision’s footnotes?

*Pursuant to Section 101.21(d) of the Board’s Statements of Proce- dure, absent a waiver, an election will normally be scheduled for a date or dates between the 25th and 30th day after the date of this decision.

**The Board has adopted a rule requiring that election notices be posted by an employer “at least 3 full working days prior to 12:01 a.m. of the day of the election.”

***In order to assure that all eligible voters may have the opportu- nity to be informed of the issues in the exercise of their statutory right to vote, all parties to the election should have access to a list of voters and their addresses which may be used to communicate with them. North Macon Health Care Facility, 315 NLRB 359 (1994); Excelsior Underwear, Inc., 156 NLRB 1236 (1966).… Accordingly, it is hereby directed that within 7 days of the date of this Decision, 3 copies of an election eligibility list, containing the full names and addresses of all eligible voters, shall be filed by the Employer with the Regional Director, Region 2.…


Effective April 30, 2012, Parties will no longer have the right to seek Board review of Regional Directors’ pre-election decisions such as the decision rendered in the St. Barnabas case, deferring such appeals to the Board until after the election vote count58A. Pre-election Board review allowed delay in the voting process and could be used by employers to stall union organizing drives. These pre-election disputes are often rendered moot by the election results. For example, an employer pre-election challenge to the eligibility of certain workers to vote becomesmoot if the union loses the election.


The NLRA authorizes the Board to select an appropriate unit so as to assure the fullest freedom of collective bargaining. The Act, however, includes many statutory mandates. Professional and nonprofessional workers may not be included in the same unit unless a majority of professionals first vote to be part of an overall unit. Separate craft units may not be found inappropriate by reason of prior certifica- tions unless the craft majority so votes. Plant guards may not be included in a unit with other employees of the same employer.

The NLRB has broad discretion in determining an appropriate bargaining unit dispute. The common employment interests of workers, such as skill and training requirements, functional unity, and the history of bargaining and personnel policy, are a primary consideration.

Relevant to unit determinations are managerial and supervisory organizations and functions that, along with skill and similar functional considerations, may result in separating truck drivers or maintenance or custodial workers from a plantwide unit. On the basis of pertinent facts, technical employees with different group interests may be excluded from a unit of production and maintenance workers. Employees in a confidential capacity in the effecting of management-labor policies or those with supervisory responsibilities are excluded from any unit for collective bargaining.

The following guidelines have been applied to decide what employees will be grouped or whether, in the case of multiple-plant or store operations under unitary management, separate or combined employee units should be formed.

1. The physical location of production facilities is a factor. If the facilities are fairly close together, the Board has tended to favor a combined unit embracing workers in all plants.

2. A difference in the skill requirements of the work to be performed by employees usually leads to a separation. The routine worker and the skilled employee are subjected to differing wage and working condition benefits and otherwise have little in common. At any rate, under the Globe doctrine, skilled employees must be given the right to vote on the question of a separate unit or a plantwide unit.59

3. The degree of ownership and managerial integration is also a factor in decid- ing whether employees should be grouped or separated for bargaining pur- poses. Are the facilities in question commonly owned? Would cessation of

58A See NLRB Regulations, Section 102.62 and Section 102.69 (Dec. 22, 2011). The U.S. Chamber of commerce filed a lawsuit in federal district court seeking to enjoin the NLRB from enforcing the rule. Chamber of commerce v. NLRB, D.D.C., 1:11-cv-02262 59 Globe Machine and Stamping Co., 3 NLRB 294 (1937).


activity in one facility adversely affect performance in the others? Are manage- rial policies centrally formulated and uniformly applied to all facilities? Are conditions of employment essentially uniform among the several plants? Are employees frequently transferred and interchanged? If the answers are in the affirmative, the Board has favored a homogeneous unit.

4. The collective bargaining history of an employer has often led the Board to separate or combine bargaining units based on the employer’s previous experi- ence. If a particular employer has formerly enjoyed amicable relations with its employees under separate or combined units, such forms will generally be favored for present purposes.

5. The extent of organization is the final consideration entering into the Board’s resolve to separate or combine for negotiation and representation purposes. The extent of organization is the degree to which employees in individual plants of multiple-plant companies have presently organized. Under the Wagner Act, the Board could decide that employees in Plant A were entitled to representation as a single unit even though the employees in Plants B and C had not, as yet, been sufficiently organized to call for an election. Some limitation is placed upon the Board’s discretion in this regard by the 1947 NLRA. Section 9(c)(5) provides that “in determining whether a unit is appropriate … the extent to which the employees have organized shall not be controlling.” Thus, by legislative man- date, if other factors favor a multiple-plant unit, the Board may not base a plant unit decision upon a finding that the present extent of organization militates against a multiple-plant unit. This proviso does not outlaw consideration by the Board of organizational extent; it merely limits the weight the Board can accord it in deciding whether to separate or combine for appropriate unit purposes.

The Board engaged in rulemaking to resolve issues relating to appropriate bargain- ing units in the health care industry, establishing eight bargaining units that will be found appropriate at acute care hospitals. They are (1) all registered nurses, (2) all physi- cians, (3) all other professionals, (4) all technical employees, (5) all skilled maintenance employees, (6) all business office clerical employees, (7) all guards, and (8) all other non- professional employees. The American Hospital Association v. NLRB60 decision affirmed the Board’s authority to establish the units through its rulemaking authority.

The following two cases, American District Telegraph and NLRB v. Hendricks County Rural Electric Membership Corp., illustrate situations in which it might be appropriate to separate employees for bargaining purposes.

60 499 U.S. 606 (1991).


Employer, who is engaged in furnishing protective services by means of electric devices which it installs and maintains, employs several classifications of ser- vicemen. Employer also operates a one-man division responsible for selling, installing, and repairing back- ground music systems.

The union seeks to represent all of the above employees, as well as all porters. Employer contends that all of the servicemen are guards, that the back- ground music director is a supervisor, and that these employees should consequently be excluded from any bargaining unit.



Of employer’s several classifications of servicemen, only the S-2 group was specifically charged with duties related to enforcing rules to protect property or the safety of persons on customers’ premises. This group was armed, wore uniforms, worked irregular hours, and was primarily responsible for detaining intruders apprehended in response to alarms….

The remaining classifications, S-1 and S-3, com- prised servicemen whose duties principally involved installing and repairing the electric devices or moni- toring signals therefrom.

Although the music director worked in a separate administrative office building and was on a separate payroll, he remained under the supervision of the Dis- trict Manager who was responsible for the servicemen.

Although the union asserts that the S-2’s are primarily mechanics and have only incidental duties with respect to apprehension of intruders, the stipu- lation of the parties states the reverse. In view of this, as well as the fact that they are uniformed and armed, the S-2’s are guards within the meaning of the Act….

In contrast to the situation in ADT Company, 112 NLRB 80, there is no evidence that the regular S-1’s

have any responsibility other than prompt restoration of service through repairs. The instant situation being more akin to American District Telegraph Co., 128 NLRB 345, the S-1’s, accordingly, are not guards within the meaning of the Act.

Although the S-3’s may well be an integral part of ADT’s protection operation, there is nothing in the Act which requires that they be deemed guards on that basis alone. Since they have none of the charac- teristics of the servicemen previously determined to be guards, but merely monitor signals, they are includ- able in the non-guard unit.

The music director appears to have none of the statutory indicia of supervisory status, but does seem to have a community of interests with the regu- lar S-1’s and S-3’s. Consequently, he shall also be included in the non-guard unit.

Case Questions

1. Whom did the Union seek to represent in one bargaining unit?

2. Discuss the differences between the various classifications of service persons.


[Mary Weatherman was the personal secretary to the general manager and chief executive of Hendricks County Rural Electric Membership Corporation (Hendricks). She had been employed by the coopera- tive for nine years. In May 1977, she signed a petition seeking reinstatement of a close friend and fellow employee who had lost his arm in the course of employment with Hendricks and had been dismissed. Several days later she was discharged. Weatherman filed an unfair labor practice charge with the NLRB, alleging that the discharge violated Section 8(a)(1) of the Act. Hendricks’s defense was that Weatherman was denied the Act’s protection because as a “confi- dential” secretary, she was implicitly excluded from the Act’s definition of “employee” in Section 2(3). The administrative law judge rejected this argument. He noted that the Board’s decisions had excluded from bargaining units only those “confidential employees … who assist and act in a confidential

capacity to persons who formulate, determine, and effectuate management policies in the field of labor relations.” Applying this “labor-nexus” text, the ALJ found that Weatherman was not such a “confidential employee.” He also determined that Hendricks had discharged Weatherman for activity—signing the petition—protected by Section 7 of the Act. The ALJ thus sustained Weatherman’s unfair labor practice charge. The Board affirmed and ordered that Weath- erman be reinstated with back pay. The U.S. Court of Appeals for the Second Circuit denied enforcement of the Board’s order. The Supreme Court granted certiorari.]

BRENNAN, J.… Section 2(3) of the NLRA provides that the “term ‘employee’ shall include any employee…” (emphasis added), with certain stated exceptions such as “agricul- tural laborers,” “supervisors” as defined in § 2 (11),



and “independent contractors.” Under a literal read- ing of the phrase “any employee,” then, the workers in question are “employees.” But for over 40 years, the NLRB, while rejecting any claim that the defini- tion of “employee” in § 2(3) excludes confidential employees, has excluded from the collective bargain- ing units determined under the Act those confidential employees satisfying the Board’s labor-nexus test. Respondents argue that contrary to the Board’s prac- tice, all employees who may have access to confiden- tial business information are impliedly excluded from the definition of employee in § 2(3)….

In 1935 the Wagner Act became law. The Act’s broad objectives were to “encourag[e] the practice and procedure of collective bargaining and … protec[t] the exercise by workers of full freedom of association, self-organization, and designation of representatives of their own choosing, for the purpose of negotiating the terms and conditions of their employment or other mutual aid or protection.” The employees covered by the Act were defined in § 2(3): “The term ‘employee’ shall include any employee … but shall not include any individual employed as an agricultural laborer, or in the domestic service of any family or person at his home, or any individual employed by his parent or spouse.” Although the Act’s express exclusions did not embrace confidential employees, the Board was soon faced with the argu- ment that all individuals who had access to confiden- tial information of their employers should be excluded, as a policy matter, from the definition of “employee.” The Board rejected such an implied exclusion, finding it to have “no warrant under the Act.” But in fulfilling its statutory obligation to determine appropriate bar- gaining units under § 9 of the Act, for which broad discretion has been vested in the Board, the Board adopted special treatment for the narrow group of employees with access to confidential, labor-relations information of the employer. The Board excluded these individuals from bargaining units composed of rank-and-file workers. The Board’s rationale was that “management should not be required to handle labor relations matters through employees who are represented by the union with which the [c]ompany is required to deal and who in the normal performance of their duties may obtain advance information of the [c]ompany’s position with regard to contract negotiations, the disposition of grievances, and other labor relations matters.” Hoover Co., 55 NLRB 1321, 1323 (1944)….

In 1946, in Ford Motor Co., 66 NLRB 1317, 1322 the Board refined slightly the labor-nexus test because in its view the “definition [was] too inclusive and needlessly preclude[d] many employees from bargaining collectively together with other workers having common interests.” Henceforth, the Board announced, it intended “to limit the term ‘confiden- tial’ so as to embrace only those employees who assist and act in a confidential capacity to persons who exercise ‘managerial’ functions in the field of labor relations.” This was the state of the law in 1947 when Congress amended the NLRA through the enactment of the Taft-Hartley Act….

The Court of Appeals, and the respondents here, rely on dictum [a statement within an opinion which lacks the force of law] in a footnote to NLRB v. Bell Aerospace, 416 U.S. 267 (1974), to suggest that the Eightieth Congress believed that all employees with access to confidential business information of their employers had been excluded from the Wagner Act by prior NLRB decisions and that Congress intended to freeze that interpretation of the Wagner Act into law. The Bell Aerospace dictum is:

In 1946 in Ford Motor Co., 66 NLRB 1317, 1322, the Board had narrowed its definition of “confidential employees” to embrace only those who exercised “‘managerial’ functions in the field of labor relations.” The discussion of “confidential employees” in both the House and Conference Committee Reports, however, unmistakably refers to that term as defined in theHouse bill, which was not limited just to those in “labor relations.” Thus, although Congress may have misconstrued recent Board practice, it clearly thought that the Act did not cover “confidential employees” even under a broad definition of that term.

Obviously this statement was unnecessary to the determination whether managerial employees are excluded from the Act, which was the question decided in Bell Aerospace. In any event, the statement that Congress “clearly thought that the Act did not cover ‘confidential employees,’ even under a broad definition of that term,” is error. The error is clear in light of our analysis … of the legislative history of the Taft-Hartley Act pertinent to the question….

The Court’s ultimate task here is, of course, to deter- mine whether the Board’s “labor-nexus” limitation on the class of confidential employees who, althoughwithin the definition of“employee” under § 2(3),may be denied




Multiemployer bargaining units exist in many industries and are strictly consensual arrangements between a union and a group of employers. Multiemployer bargain- ing presents an opportunity to both the employer group and the union to achieve informed and efficient bargaining and contract administration. Also, because all the employer members of the group will be obligated under their collective bargain- ing contract to pay the same wages and benefits to their employees and will be sub- ject to the same contractual work rules, major competitive factors are removed between the employer members of the group. This is seen as an advantage by employers. Consistent wages, benefits, and work rules for employees working for different employers in the same industry and geographical area are sought-after union objectives.

the inclusion in bargaining units has “a reasonable basis in law.” Clearly the NLRB’s longstanding practice of excluding from bargaining units only those confidential employees satisfying the Board’s labor-nexus test, rooted firmly in the Board’s understanding of the nature of the collective bargaining process, and Congress’ acceptance of that practice, fairly demonstrates that the Board’s treatment of confidential employees does indeed have “a reasonable basis in law.” …

… In this court respondent Hendricks does not argue that Weatherman came within the labor-nexus test as formulated by the Board, but rather concedes that Weatherman did not have “confidential duties ‘with respect to labor policies.’” Because there is there- fore no dispute in this respect, and in any event no sug- gestion that the Board’s finding regarding labor nexus was not supported by substantial evidence, we conclude that the Court of Appeals erred in holding that the record did not support the Board’s determination that Weatherman was not a confidential employee with a labor nexus.* We therefore reverse the judgment of the Court of Appeals in Hendricks insofar as enforcement

of the Board’s order was denied, and remandwith direc- tion to enter an order enforcing the Board’s order.

It is so ordered.

POWELL, J. (joined by BURGER, C. J., and REHNQUIST and O’CONNOR, J. J.), dissenting … After today’s decision, labor must accept into its rank confidential secretaries who are properly allied to man- agement. And these confidential employees, who are privy to the daily affairs of management, who have access to confidential information, andwho are essential tomanagement’s operationmaybe subjected to conflicts of loyalty when the essence of theirworking relationship requires undivided loyalty. The basic philosophy of the labor relations laws, the expressed intent of Congress, and the joint desire of labor and management for undi- vided loyalty all counsel against such a result.

Case Questions

1. Did Hendricks argue before the Supreme Court that all employees who may have access to confi- dential business information are impliedly excluded from the definition of “employee” in Section 2(3)?

2. What is the Board’s labor-nexus test? 3. What is the Board’s rationale for excluding from

bargaining units certain confidential employees under its labor-nexus test?

4. Was Congress under the impression that the NLRA did not cover confidential employees when it passed the Taft-Hartley Act in 1947?

*We do not suggest that personal secretaries to the chief executive officers of corporations will ordinarily not constitute confidential employees. Hendricks is an unusual case, inasmuch as Weatherman’s tasks were “deliberately restricted so as to preclude her from” gain- ing access to confidential information concerning labor relations. 236 NLRB 1616, 1619 (1978). Whether Hendricks imposed such constraints on Weatherman out of specific distrust or merely a sense of caution, it is unlikely that Weatherman’s position mirrored that of executive secretaries in general.


All employer members of the group must stipulate that they intend to be bound by group rather than individual action. The union having representative sta- tus must also assent. The Board will not sanction the creation of a multiemployer unit over the objection of any party. Once the unit is formed, the multiemployer group has substantially the same bargaining responsibilities as any single employer under the Act.

The Bonanno Linen Service v. NLRB decision presented next deals with an employer’s unilateral withdrawal from a multiemployer unit because of a bargain- ing impasse. Once consent has been given and negotiations have begun, neither an employer nor the union may withdraw without mutual consent absent “unusual circumstances.”61 The “unusual circumstances” exception has been limited to extreme situations, such as where the employer is subject to extreme financial pres- sures or the unit has dissipated so as no longer to be viable. In NLRB v. D.A. Nolt, Inc., the Court of Appeals found that secret negotiations between the union and the multiemployer unit deprived Nolt of its right to withdraw prior to the com- mencement of negotiations.62 In Bonanno, the Supreme Court upheld the Board’s determination that a bargaining impasse is not an unusual circumstance justifying unilateral withdrawal from the unit.


[Charles D. Bonanno Linen Service, Inc., was a mem- ber of the New England Linen Supply Association, a group of 10 employers formed to negotiate with Teamsters Local Union No. 25 as a multiemployer unit. On February 19, 1975, Bonanno authorized the association’s negotiating committee to represent it in the anticipated negotiations for a new contract. The union and the association held 10 bargaining ses- sions during March and April. On April 30, the nego- tiators agreed upon a proposed contract, but four days later the union members rejected it. By May 15, the union and the association had reached an impasse over the method of compensation: the union demanded that the drivers be paid on commis- sion, while the association insisted on continuing payment at an hourly rate. Several meetings failed to break the impasse, and on June 23, the union initiated a selective strike against Bonanno. In response, most of the association members locked out their drivers.

Despite sporadic meetings, the stalemate continued throughout the summer.

Bonanno hired permanent replacements for all of its striking drivers. On November 21, it notified the association and the union that it was “withdrawing” from the association with respect to negotiations because of the ongoing impasse with Teamsters Local 25. Shortly thereafter, the association ended the lockout and continued multiemployer negotia- tions. Several negotiating sessions took place between December and April, without Bonanno participating. In the middle of April, the union abandoned its demand for payment on commission and accepted the association’s offer of a revised hourly wage rate. With this development, the parties agreed on a new contract dated April 23, 1976, that was given retro- active effect to April 18, 1975. In a letter dated April 29, the Union informed Bonanno that because the union had never consented to the withdrawal, it


61 Hass Electric, Inc. v. NLRB, 299 F.3d 23 (1st Cir. 2002). 62 406 F.3d 200 (3d Cir. 2005).


considered Bonanno to be bound by the settlement just reached.

The NLRB held that a bargaining impasse did not justify Bonanno’s unilateral withdrawal from the multi-employer unit and that such an attempt was a violation of Sections 8(a)(5) and 8(a)(1) of the NLRA by refusing to execute the collective bargaining agree- ment later executed by the union and the association. The court of appeals enforced the Board’s order, and the Supreme Court granted certiorari.]


I. Multiemployer bargaining has continued to be the preferred bargaining mechanism in many industries,* and as Buffalo Linen predicted, it has raised a variety of problems requiring resolution. One critical ques- tion concerns the rights of the union and the employers to terminate the multiemployer bargaining arrange- ment. Until 1958, the Board permitted both employers and the Union to abandon the unit even in the midst of bargaining. But in Retail Associates, Inc., 120 NLRB 388, 41 LRRM 1502 (1958), the Board announced guidelines for withdrawal from multiemployer units. These rules, which reflect an increasing emphasis on the stability of multiemployer units, permit any party to withdraw prior to the date set for negotiation of a new contract or the date on which negotiations actually begin, provided that adequate notice is given. Once negotiations for a new contract have commenced, however, withdrawal is permitted only if there is “mutual consent” or “unusual circum- stances” exist.

The Board’s approach in Retail Associates has been accepted in the courts, as have its decisions that unusual circumstances will be found where an employer is subject to extreme financial pressures or where a bargaining unit has become substantially frag- mented. But as yet there is no consensus as to whether an impasse in bargaining in a multiemployer unit is an unusual circumstance justifying unilateral withdrawal by the Union or by an employer. After equivocating

for a time, the Board squarely held that an impasse is not such an unusual circumstance.

II. We agree with the Board and with the Court of Appeals. The Board has recognized the voluntary nature of multiemployer bargaining. It neither forces employers into multiemployer units nor erects barriers to withdrawal prior to bargaining. At the same time, it has sought to further the utility of multiemployer bar- gaining as an instrument of labor peace by limiting the circumstances under which any party may unilaterally withdraw during negotiations. Thus, it has reiterated the view expressed in Hi-Way Billboards that an impasse is not sufficiently destructive of group bar- gaining to justify unilateral withdrawal. As a recurring feature in the bargaining process, impasse is only a temporary deadlock or hiatus in negotiations “which in almost all cases is eventually broken either through a change of mind or the application of economic force.” Charles D. Bonanno Linen Service, 243 NLRB 1093 (1979). Furthermore, an impasse may be “brought about intentionally by one or both parties as a device to further, rather than destroy, the bargaining process.” Hence, “there is little warrant for regarding an impasse as a rupture of the bargaining relation which leaves the parties free to go their own ways.” As the Board sees it, permitting withdrawal at impasse would as a practical matter undermine the utility of multiemployer bargaining.**


Case Questions

1. State the Board’s guidelines for withdrawal from multiemployer units as set forth in Retail Associates.

2. Is an impasse in bargaining in a multiemployer unit an unusual circumstance justifying unilateral withdrawal?

3. What is an impasse in bargaining?

*A recent survey of major collective bargaining agreements (those covering 1,000 or more employees) found that of 1,536 major agree- ments, 648 (42 percent) were multiemployer agreements and that 3,238,400 employees were covered by these agreements. U.S. Bureau of Labor Statistics, Dept. of Labor, Bull. No. 2065, Characteristics of Major Collective Bargaining Agreements—January 1, 1978, at 12, table 4.8 (1980).

**The Board explains that if withdrawal were permitted at impasse, the parties would bargain under the threat of withdrawal by any party who was not completely satisfied with the results of the nego- tiations. That is, parties could precipitate an impasse in order to escape any agreement less favorable than the one expected. In addi- tion, it is precisely at and during impasse, when bargaining is tempo- rarily replaced by economic warfare, that the need for a stable, predictable bargaining unit becomes acute so that the parties can weigh the costs and possible benefits of their conduct.



At the heart of labor-management relations is the bargaining unit. It is all- important that the bargaining unit be truly appropriate and not contain a mix of antagonistic interests or submerge the legitimate interests of a small group of employees in the interest of a larger group. The Board has the responsibility of determining which group of employees should be considered appropriate. In the Mallinckrodt Chemical Works63 decision, the Board spelled out the policy guide- lines that it would use in determining whether the severance of a bargaining unit composed of the craft workers in a larger unit would be appropriate. The guide- lines are summarized as follows:

1. The makeup of the proposed unit—whether it consists of a distinct and homo- geneous group of skilled craft workers

2. The history of collective bargaining of the employees involved 3. The extent to which the employees in the proposed unit have established and

maintained their separate identity during the period of inclusion in a broader unit

4. The history and pattern of collective bargaining in the industry involved 5. The degree of integration of the employer’s production processes 6. The qualifications of the union seeking to “carve out” a separate unit

These Board guidelines are applicable not only to craft severance situations in organized plants but also to the initial formation of units in unorganized plants.64


Section 9(a) of the NLRA provides for union recognition and bargaining rights when questions regarding the majority representation status for an appropriate bar- gaining unit are resolved in favor of a union. The fundamental mandate of the NRLA is found in Section 9(a), stating:

Representatives designated or selected for the purposes of collective bargaining by the majority of the employees in a unit appropriate for such purposes, shall be the exclu- sive representatives of all the employees in such unit for the purposes of collective bar- gaining in respect to rates of pay, wages, hours of employment or other conditions of employment.

The NLRB’s function under Section 9 of the Act is to ascertain through its election procedures whether a majority of employees want a particular union to be their exclusive bargaining representative. The Board also conducts decertification proceedings that determine whether a certified or recognized union continues to represent a majority of the employees in a bargaining unit.65

63 162 NLRB 387 (1966). 64 E. I. duPont, 162 NLRB 413 (1966). 65 Section 9(c).



An employer may voluntarily recognize a union without a Board election when the employer has no reasonable doubt as to its employees’ preference for the union in question. The employer must act with due care in ascertaining the majority status of the union, however.66 A card check majority is a legitimate means for establish- ing an employer’s duty to bargain. In recent years, unions have sought to avoid Board-supervised election procedures for several reasons, including (1) delays that may occur between the filing of a representation petition and the actual Board election; (2) the employer’s advantage of regular communication with employees while they are at work compared to the union’s lack of access to employees; and (3) employer intimidation that may occur with a lack of effective Board remedies, such as a usual Board remedy for employer election misconduct being a rerun elec- tion with the posting of notices not to violate the Act in the future—after going through a year of litigation. Unions now seek to negotiate card check agreements along with neutrality agreements with employers to bypass NLRB elections. The language of a typical authorization card may state in relevant part:

Desiring to become a member of the above Union of the International Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of America, I hereby make appli- cation for admission to membership. I hereby authorize you or your agents or repre- sentatives to act for me as collective bargaining agent on all matters pertaining to rates of pay, hours or any other condition of employment.67

A typical card check agreement may provide for recognition of a union after a designated neutral third party confirms that the union has obtained authorization cards from an agreed-upon percentage of the bargaining unit, such as a majority of eligible employees, or a set majority percentage ranging from 51 percent up to 65 percent. Most neutrality agreements are obtained by strong unions in highly unionized industries, such as the UAW in the auto industry, or by unions that deal with employers who deal directly with the public and are susceptible to union pres- sure from the likes of hotel and restaurant employee unions. Card check and/or neutrality agreements may be negotiated with companies that have an existing bargaining relationship with a union, with the agreement to apply to new facilities that are opened or acquired in the future. A UAW neutrality agreement with ALCOA stated in part:

The company agrees to a position of neutrality in the event that the Union seeks to represent any nonrepresented employees of the Aluminum Company of America. Neu- trality means that the Company shall not comment negatively concerning the integrity or character of the Union or its officials. The Company’s commitment to remain neu- tral shall cease if the Union, its agents, or its supporters comment negatively on the integrity or character of the Aluminum Company of America or its representatives.

66 An employer commits an unfair labor practice in violation of Section 8(a)(2) of the Act should it recognize a minority union; Section 8(b)(1)(A) makes it an unfair labor practice for a union to coerce employees in the solicitation of employee card support. 67 This authorization card was used by the Teamsters in the landmark NLRB v. Gissel Packing Co. case, presented subsequently in this chapter.



In Keller Plastics Eastern, Inc.,68 an employer’s voluntary recognition of a union based on a showing of majority status—as opposed to certification after a Board election—barred a decertification petition or a rival union’s petition for “a rea- sonable period of time.” The Keller Plastics Board reasoned that when an employer voluntarily recognizes a union in good faith based on a showing of majority support, the parties are permitted a reasonable period to bargain for a first contract without challenge to the union’s majority status. In Dana Corp.,69

the Board majority modified this “recognition bar doctrine” and held that an employer’s voluntary recognition of a union does not bar a decertification petition or rival union petition that is filed within 45 days of the notice of recog- nition. The Board majority expressed preference for the exercise of employee free choice in Board elections as opposed to reliance on authorization cards that are inferior to the election process.

The Board majority raised three points in this regard:

1. Unlike votes cast in privacy by Board secret election ballots, card signings are public actions and susceptible to group pressure exerted at the moment of choice. The election is held under the watchful eye of a neutral Board agent and observers from the parties. A card signing has none of these protections. There is good reason to question whether card signings in such circumstances accurately reflect employees’ true choices concerning union representation….

2. Union card solicitation campaigns have been accompanied by misinformation or a lack of information about employees’ representational options….

3. Like a political election, a Board election presents a clear picture of employee voter preference at a single moment….

The dissent states that nothing in the majority’s decision justifies its radical departure from the well-settled, judicially approved Keller Plastics precedent, and it relegates voluntarily recognition to disfavored status. The dissent states in part:

An employer has the right to refuse to voluntarily recognize a union and demand an election…. One important reason employers choose voluntary recognition is to avoid the time, expense, and disruption of an election. That rationale, however, is critically undermined by the majority’s modifications. An employer has little incentive to recog- nize a union voluntarily if it knows that its decision is subject to second-guessing through a decertification petition. Furthermore, even if an employer does choose to recognize a union voluntarily, the majority’s new window period leaves the parties’ bargaining relationship open to attack by a minority of employees at the very outset of the relationship, when it is at its most vulnerable [point]….70

With the changing composition of the Board subsequent to the 2008 presiden- tial election, a new Board majority overruled the Dana Corp. decision and returned

68 157 NLRB 583 (1966). 69 351 NLRB No. 28 (Sept. 29, 2007). 70 Id., slip op. at 10.


to the Keller Plastics precedent in the Board’s Lamons Gasket Co. decision.71

In this decision the Board majority also defined a “reasonable period of time” as no less than six months after the parties’ first bargaining session and no more than one year.


The Board’s election procedures are initiated by the filing of a representation petition with the appropriate regional office of the NLRB. This petition may be filed by any individual or labor organization acting on behalf of a substantial num- ber of employees. This petition must be supported by a showing that at least 30 percent of the employees involved want the union to be their bargaining repre- sentative or want to have an NLRB election to make such a determination. This so-called showing of interest to the Board may be demonstrated by signed authori- zation cards or a signed petition. Unions commonly obtain authorization cards far in excess of the 30 percent figure, because the chances of winning a representation election are slim when a union has been able to obtain authorization cards from only 30 percent of the employees.

Employees in a bargaining unit are limited to one valid election in a 12-month period.72 A petition to seek an election when a valid election has been held within the previous 12 months is untimely.

Although most representation petitions are filed by unions, an employer may also file a petition when the employer is confronted with a demand that a union be recognized as the exclusive bargaining representative of the employees.73 Thus, when a union asks for a meeting to negotiate an agreement or sets up a picket line demanding recognition, the employer may file a petition for an election.

The language of the Act does not establish any standards or procedures whereby a union may intervene in a representation case started by a rival union or an employer. If the intervening union submits some timely showing of interest “of any percentage” among the employees involved, the Board will allow that union to appear on the ballot in order to ensure full expression of employee choice and to prevent objection and delay by an excluded union.

After the representation petition is filed by a union at the regional office of the Board, the regional staff determines (1) whether the Board’s jurisdictional stan- dards (set forth in Section 4:5 of this book) have been met, (2) whether the required 30 percent showing of interest by employees has been met, and (3) whether the bargaining unit involved is appropriate. The regional staff then seeks to obtain an agreement of the parties to a “consent election.” Two options exist. A consent election agreement provides for an election conducted by the regional office with final authority over any disputes vested in the regional director. A stipulation for certification also provides for a consent election to be conducted by the regional office, but final determination of any disputes is vested in the Board itself

71 357 NLRB No. 72 (2011). 72 Section 9(c)(3). 73 Section 9(c)(1)(B).


after the regional director has made interim recommendations. The election date is usually within 42 days of the filing of the petition. Employees are eligible to vote if they had employee status on the date of the election and were also employed in the appropriate bargaining unit at the end of the payroll period immediately preceding the date on which an election was directed by the Board or consented to by the parties. Economic strikers are allowed to vote in an election conducted within 12 months of the start of a strike.74


Decertification proceedings challenge whether a certified or recognized union con- tinues to represent a majority of the employees in the bargaining unit.

EMPLOYEE OPTIONS. Section 9(c)(1)(A) provides that a decertification petition may be filed by employees. This petition, like a representation petition, must be sup- ported by a 30 percent showing of the employees involved, signifying that they do not want the certified or recognized union to be their bargaining representative or want to have a Board election make such a determination. This showing is com- monly accomplished by signatures on a petition.

A decertification petition may not be initiated by an employer, a supervisor, or another agent of the employer. Thus, if the regional staff’s investigation of the peti- tion shows that the employer or a supervisor initiated, circulated, or sponsored the employees who filed a decertification petition, the petition will be dismissed.75

Once the decertification petition has been properly filed with the Board, the regular NLRB election rules apply and management may actively participate in the cam- paign to decertify the union.

The Caterair International v. NLRB decision, presented in this section, sets forth the extensive fact pattern evidencing that management exercised a pervasive influence in procuring employee signatures for a union decertification election. This conduct tainted the decertification petition and destroyed the company’s basis for withholding recognition of the union and refusing to bargain with the union. The company had to recall, with partial back pay, the unfair-labor-practice strikers and terminate its replacement workers, wasting the company’s economic and man- agerial resources and incurring significant legal costs. The company ultimately set- tled the dispute for $5 million.

During the year following certification, after a Board secret ballot election, a union has an irrebuttable presumption of a continuing majority status in the unit and no petition challenging the majority status of the union will be considered by the Board.76 This is called a certification year bar.

74 Section 9(c)(3). 75 Maywood Plant of Grede Plastics, 235 NLRB 363 (1978), as modified in NLRB v. Maywood Plant of Grede Plastics, 628 F.2d 1 (D.C. Cir. 1980). But see Connecticut Distributors, Inc., v. NLRB, 681 F.2d 127 (2d Cir. 1982). 76 Ray Brooks v. NLRB, 348 U.S. 96 (1954).


EMPLOYER OPTIONS. In dealing with an incumbent union requesting renewal of its collective bargaining contract, an employer who questions the union’s continuing majority status may request a formal Board-supervised election, called an RM (Representation Management) election by the Board, based on the legislative his- tory of Section 9(c)(1)(B) of the Act. However, to obtain such an RM election, the employer must demonstrate that it had “objective reasonable doubt” about the majority status of the union.77

In the Board’s Levitz Furniture Company of the Pacific, Inc.,78 decision, a Board majority held that an employer may unilaterally (without a Board- supervised election) withdraw recognition from an incumbent union only when it can prove that the union has actually lost the support of a majority of employees in the bargaining unit. The Board’s prior good faith reasonable doubt test was overruled as a basis for refusing to bargain. The Board majority reasoned that withdrawal of recognition in the absence of proof of actual majority loss under- mined important policies by destroying bargaining relationships and depriving employees of their chosen representative.79

In Parkwood Development Center, Inc., v. NLRB, the Board determined that the employer violated Section 8(a)(5) of the NLRA by withdrawing recognition from the union without proving “actual loss” of majority support as required by Levitz.


[Caterair is a company that furnishes meals to the air- line industry. On March 11, 1991, Teamster Local 572 filed charges with the NLRB alleging that manage- ment solicitation of signatures for a decertification petition and management coercion of signatures were in violation of Sections 8(a)(1) and (3) of the NLRA. The Board issued a multicount complaint alleging that management solicitation had impermissibly tainted the

decertification petition, thus invalidating Caterair’s reliance, and that the resulting strike was motivated by Caterair’s unfair labor practices.

Twenty-eight employees testified on behalf of the union before the ALJ, the majority of them relating either that managers had solicited their signatures or that they had witnessed managers talking to groups of employees and asking them to sign papers. None

77 In general, see Allentown Mack Sales and Service, Inc. v. NLRB, 522 U.S. 359 (1988), in which a 5–4 majority of the Supreme Court upheld the Board’s “good faith reasonable doubt” test. A different 5–4 majority of the Court, however, determined that the Board failed to recognize several objective indicators that supported the employer’s decision to conduct an independent poll of its workforce. 78 See Levitz Furniture Co. of the Pacific, 333 NLRB 717 (2001). See also MacDonald Partners, Inc., 342 NLRB No. 63 (2004). 79 A third option exists for employers: that of conducting an internal poll of employees regarding con- tinued support for a union. The employer, however, must demonstrate that it had a good faith reason- able doubt about the majority status of the union, and the polling must not be coercive in violation of Section 8(a)(1). The Levitz Furniture Board did not address polling in its decision. The restrictions applicable to polling under Section 8(a)(1) case law make polling an undesirable method of resolving questions about the majority status of a union.



of the testifying employees had actually signed the petition. Four managers testified, denying that they had solicited employee signatures for the petition. At least one manager testified that he often carried around a clipboard and asked employees to sign work-related documents. The ALJ credited the employee-witnesses’ testimony and discredited the conflicting managers’ testimony, concluding that the managers had engaged in “widespread and con- spicuous” solicitation of employees’ signatures in vio- lation of Section 8(a)(1) of the National Labor Relations Act. The ALJ determined that Caterair had violated Section 8(a)(5) of the Act by relying upon the tainted decertification petition as the basis for withdrawing recognition of, and refusing to bar- gain with, the union. The ALJ also concluded that the strike was motivated by Caterair’s unfair labor prac- tices, a conclusion Caterair does not now challenge. The ALJ ordered Caterair to cease and desist from interfering with its employees’ rights under Section 7 of the National Labor Relations Act to form, join, or assist labor organizations of their own choosing. The ALJ also ordered Caterair to reinstate strikers to their former jobs and to provide back pay from the date of the union’s unconditional offer to return to work, October 3, 1991. Finally, the ALJ ordered Caterair to recognize and bargain with the union upon its request as the collective bargaining representative of employees in the unit. The Board adopted these find- ings and Caterair appealed.]

WALD, C. J.… In February 1991, Caterair employed roughly 750 unit employees and fifty-seven managers at the three facilities. Approximately 450 of those employees and thirty-nine managers worked at the largest of those three facilities (“Facility A”). Caterair employed about 275 unit employees and fourteen managers at the second facility (“Facility B”). The smallest facility employed only twenty-five unit employees and four managers (“Facility C”). As of February 1991, 403 unionized employees, or 54% of the unit, had autho- rized Caterair to deduct union dues and fees from their paychecks.

In December 1990 and January 1991, three employees asked Caterair’s human resources director how to decertify the Union. The company prepared fliers responsive to their inquiries describing the pro- cess by which employees could request their fellow employees to sign a decertification petition expressing

disaffection with the Union and requesting that the Board hold an election. These fliers stated that the petition had to be filed with the Board between sixty and ninety days prior to the expiration of the contract, a period that would run between March 2 and March 31, 1991. They also indicated that the petition had to be signed by at least 30% of the unit employees. One document explained that if more than 50% of employees signed the petition, Caterair could lawfully refuse to negotiate with the Union. The human resources director provided these informational sheets to the three inquiring employees and made them available to others upon request.

On or around February 22, 1991, employee Xiomara Menendez and others prepared a decertifi- cation petition stating that signers “d[id] not want the Union” to represent them any longer. During a one-week period beginning February 22, Menendez and about eight other employees solicited signatures at Facility A. Employee Bonnie Metcalf and three other employees simultaneously sought signatures at Facility B.

The evidence, as credited by the ALJ, suggests that on or around February 22, several managers at both facilities began actively to solicit employees’ signa- tures. Caterair’s transportation manager at Facility A, Jose Castillo, called employee Luz Davalos at her desk to inquire whether she had “signed the paper to get rid of the Union.” …When Davalos replied that she did not know what Castillo was referring to, Castillo said he would “send somebody else later to talk to” her. Thirty minutes later, employee Dolores Vasquez visited Davalos at her desk and asked her to “sign the paper to get rid of the Union” and told her “not to be a dummy.” Davalos refused to sign. Man- ager Castillo approached Davalos in the cafeteria two hours later, asking her whether someone had come by to talk to her already. She responded affirmatively and reiterated that she would not sign anything. Davalos told three other employees about her encounter with Manager Castillo….

During the same week, the production manager at Facility A, Alberto Pacheco, approached employee Rosa Rayas at her work area and inquired whether she had signed the petition “to get the Union out.” … When she said no, Manager Pacheco told her that if she did not sign, the Union would charge her “more than $200” in back dues…. He stated that the “Union was no good” because “the Union actually was a Mafia.”… Pacheco also told her that her signature



was necessary because “they only needed a few more signatures to finish the amount of signatures that the Government requires to get the Union out.” … Rayas refused to sign.

On February 21 or 22, employee Carlos Sosa saw the sanitation manager at Facility A, Saul Monroy, talking to employees while holding a sheet of paper. Shortly thereafter, Monroy approached Sosa and asked him to sign a petition containing about nine signatures so that employees could “obtain better sal- aries, cheaper health program, and more days’ vacation.” … Sosa was not able to get a good look at the petition, because Monroy had obscured the top of the page. Sosa refused to sign.

Manager Monroy solicited employee Jose Vasquez sometime between February 22 and 24 at the entrance to the dishwashing department. Monroy carried a clipboard and asked vasquez to “sign the list.” … After Vasquez asked what the list was for, Monroy responded “that he was taking the signatures so that the Union will stay in.” … Vasquez testified that everyone at the company knew he was pro- Union. He stated that he had been forewarned by fellow employees that this was merely a maneuver on Monroy’s part to get him to sign the decertifica- tion petition to oust the Union. Vasquez did not sign.

On or around February 26, Manager Monroy brought a clipboard to employee Alfred Mercado at his work area in the dishwashing department and asked him to sign a piece of paper. Monroy refused to tell Mercado what the piece of paper was for, although Mercado assumed it was the decertification petition that he had heard talk of around the work- place…. Mercado refused to sign.

Manager Monroy approached employee Victor Saldana in late February in the dishroom. He showed Saldana a clipboard on which he was collecting sig- natures, but obscured the actual petition under a white sheet of paper. Monroy asked Saldana if he would “sign to be able to get the Union out.” … Monroy told Saldana that signing would be “good” for him, and asked him “Why do you have to pay $15 per month and when they fire you, you’re not going to get any help?” … Saldana refused to sign and testified that he later told six or seven employees about the exchange.

On February 26, the assistant manager at Facility B, Oscar Peralta, spoke with employee Israel Lopez in the cafeteria in the presence of employee Teresa Reveco and six or seven others. Peralta handed Lopez

“a petition to get the Union out” and asked him to sign it. Tr. of February 4, 1992 Hearing (Testimony of Israel Lopez), at 108. Lopez observed a paper that was approximately three-fourths full of signatures. Explaining to Peralta that he was a Union Shop Steward, Lopez refused to sign. Lopez later witnessed Peralta soliciting the signature of employee Hector Hernandez. See id. at 112. Lopez heard Hernandez refuse to sign. Lopez told as many as twenty employees about his exchange with Manager Peralta.

Although Caterair vigorously disputes the conclu- sions of the ALJ drawn from such evidence, contend- ing that the evidence does not sustain the ALJ’s inference that managers solicited any actual signa- tures on the petition, the ALJ also credited the testi- mony of several employees that they saw managers talking to groups of employees and handing them sheets of paper to sign during this period….

By March 4, 1991, the decertification petition con- tained 428 employee signatures, representing 57% of the bargaining unit. Several employees filed the peti- tion with the Board on that day so as to begin the process of official decertification. In a March 15 letter, the Union asked Caterair to bargain for a new con- tract. Caterair responded by letter of March 20 that it had a “good faith doubt” about the Union’s majority status, citing the decertification petition supported by a majority of employees. Caterair refused to begin negotiations with the Union on a new contract.

After several employees discussed the possibility of striking over Caterair’s refusal to bargain, the general manager of Facility A, Jose Ramirez, called employee Daniel Godoy into his office in early April. Ramirez told Godoy that he knew Godoy had been “agitat- ing” among the employees in an effort to initiate a strike. Ramirez told Godoy that his actions were ille- gal and that he could be fired.… On May 22, the Union held an employee meeting at which the employees voted by written ballot to go on strike in response to Caterair’s refusal to negotiate. The mar- gin in favor of a strike was 318 to 6, that is, 42% of the total unit voted in favor of striking.

According to further testimony credited by the ALJ, management attempts to dissuade strikers con- tinued. In late May, human resources director Millie Bisono told employee Jerry Hayes that he would be fired if he joined the strike…. On May 31, labor rela- tions director Roberto Velazquez had a conversation with employee Fulgencio Plascencia in which Velaz- quez stated that Caterair “did not want the Union”



and that all striking employees would be “automati- cally fired.” … Velazquez told employee Castulo Flores the same thing the next day….

The strike began on June 3, 1991, and involved 289 striking employees, or 39% of the unit. Sixty- one of the striking employees had previously signed the decertification petition. Caterair began hiring per- manent replacements for the strikers almost immedi- ately. Caterair unilaterally granted a wage increase of 4–6% to employees on August 31, 1991, during the pendency of the strike.

The Union ended the strike in early October and made an unconditional offer by letter of October 3, 1991, to have the strikers return to work. The letter called the strike an unfair labor practice strike and asked the company to dismiss replacement employees and reinstate the striking workforce. Caterair refused to reinstate any of the strikers and denied that the strike had been motivated by Caterair’s unfair labor practices.

[The Court of Appeals held that the evidence war- ranted a finding that the employer’s management

exercised a pervasive influence in procuring employee signatures for the “union decertification petition.” The court enforced the Board’s order, in part, to the extent that it required Caterair to cease and desist from committing unfair labor practices. Under the cease-and-desist order Caterair is required to bargain with the Union. Company employees remain free under the cease-and-desist order to petition for decertification.]

Case Questions

1. Was it proper for the director of human resources to prepare fliers responsive to employee inquiries as to how to decertify the union?

2. Evaluate the effects of the adverse decisions of the NLRB and the court of appeals on Caterair.

3. Advise the human resources director what she should have done after preparing the flier on how to decertify the union.


[The employer, Parkwood, runs a home for the devel- opmentally disabled in Valdosta, Georgia. Until 2003, the employees who worked at the home were represented by the United Food and Commercial Workers Union. Parkwood and the union were par- ties to a collective bargaining agreement (“CBA”) that was scheduled to expire March 8, 2003.

On December 2, 2002, Parkwood was presented with a petition, signed by a majority of its employees at the home, announcing that they no longer wanted to be represented by the union. Believing that the union no longer enjoyed majority support, Parkwood told the union of the petition that same day and declared it would cease dealing with the union upon expiration of the CBA. From that moment onward, Parkwood refused to negotiate with the union for a successor agreement.

On March 7, 2003, the day before expiration of the CBA, the union presented to Parkwood a counterpeti- tion, also signed by a majority of the employees at the home, declaring a renewed desire for union representa- tion and “revoke[ing], rescind[ing] and cancell[ing]” the

earlier petition. Parkwood was unmoved by this eleventh-hour show of support for the union. When the CBA expired the next day, Parkwood refused to rec- ognize the union or bargain with it for a new agreement.

The union filed charges with the Board alleging, among other things, that Parkwood had violated Sec- tion 8(a)(5) of the NLRA by unlawfully withdrawing recognition from the union. The Board found that the employer had violated Section 8(a)(5) of the Act and imposed an affirmative bargaining order, and Park- wood appealed.]

GRIFFITH, C. J.… Parkwood contends that the Board should have mea- sured majority support on December 2, 2002, the date the company announced its intent to withdraw recognition in response to the employees’ petition, rather than on March 8, 2003….

A. Prior to Levitz, an employer could withdraw recogni- tion from a union on the basis of good-faith doubt as




The Board has promulgated preelection rules (sometimes referred to as “Board rules”) restricting the parties in their electioneering activities so that the election proceedings can best determine the true desires of employees. Section 8(a)(1) of the National Labor Relations Act prohibits employer interference or coercion, and Section 8(c) of the Act prohibits employer statements that contain threats of repri- sal or promises of benefits. A distinction is made between conduct that violates

to the union’s continued support among a majority of employees in the bargaining unit. See Levitz, 333 N.L.R.B. at 717 (citing Celanese Corp., N.L.R.B 664 (1951)). In applying this rule, the Board mea- sured good-faith doubt at the time the employer announced it…. Noting that the Board cannot ignore its own precedent, see Manhattan Ctr, Studios, Inc. v. NLRB, 452 F.3d 813, 816 (D.C. Cir. 2006), Park- wood argues that the Board was bound by pre- Levitz precedent to measure actual loss of majority support in the same way it once measured good- faith doubt, namely, on the day evidence of actual loss first came to light.

This argument fails to account for Levitz, which explicitly overruled Celanese and removed good- faith doubt as a sufficient basis for withdrawing rec- ognition from a union. 333 N.L.R.B. at 717. Levitz changed what the Board measures in scrutinizing a withdrawal of recognition, shifting from good-faith doubt to actual loss of majority support. Implicit in this decision is a corresponding change in how the Board will take its measurements. The Board’s pre- Levitz decisions never addressed the issue presented by the facts in this case, so there was no binding pre- cedent on this point from which it could depart. That the Board was not bound by its precedent to choose the earlier measuring point is apparent from our recent decision in Highlands Hospital Corp. v. NLRB, 508 F.3d 28 (D.C. Cir. 2007). In Highlands, we approved the Board’s decision to consider post- petition employee conduct in determining whether there was an actual loss of majority support. Id. at 31–32. We could not have so held if the Board’s pre- cedent required it to measure actual loss in the same way it had once measured good-faith doubt…

B. In Abbey Medical, the Board described the employer’s power to effect “ ‘an anticipatory withdrawal of

recognition’ in relation to a future contract,” which allows an employer to honor an existing CBA but question the union’s right to bargin for a new agree- ment upon its expiration. 264 N.L.R.B. at 969. To withdraw anticipatorily, an employer must “demonstrate that, on the date of withdrawal … the union in fact had lost its majority status, or [that the] withdrawal was predicated on a reasonable doubt based on objective considerations of the union’s majority status.” Id. To avoid semantic confusion, anticipatory withdrawal must be distinguished from withdrawal of recognition. Anticipatory withdrawal occurs prior to expiration of a CBA and does not obviate the employer’s obligations under the existing agreement.

Withdrawal of recognition occurs after expiration of a CBA, at which time the employer is free of con- tractual obligation.

Parkwood took full advantage of Abbey Medical. During the period that began with the employees’ peti- tion and ended with their counter-petition, Parkwood lawfully declined to bargain with the Union for a new CBA. But nothing in Abbey Medical permitted Park- wood to ignore subsequent indicators of majority sup- port in deciding whether to withdraw recognition….

We deny Parkwood’s petition for review and grant the Board’s cross-application to enforce its order.

So ordered.

Case Questions

1. Is “good faith doubt” a sufficient basis for an employer to withdraw recognition from a union?

2. What action should Parkwood have taken in view of the conflicting petitions, the first one expressing the position that a majority of employees did not want to be represented by the union and a subsequent petition expressing a majority support for the union?


Board rules and conduct that violates the Act. The importance of the distinction is based primarily on the remedies available to the Board. A violation of a Board rule may result in the limited remedy of setting aside the election and rerunning it. A violation amounting to an unfair labor practice may also result in the posting of notice that an unfair labor practice has been committed and that the employer will no longer engage in such conduct and in the setting aside of the election and the ordering of a new election. However, in extreme cases involving unfair labor practices, where the employer’s conduct was so pervasive as to render a fair rerun election unlikely and the union previously had an authorization card majority, the employer may be required to bargain without a rerun election. An example of a violation of Board rules that is not an unfair labor practice would be an employer’s failure to provide a timely list of names and addresses of employees eligible to vote. Examples of election conduct that are unfair labor practices in violation of Section 8(a)(1) are threats to close the plant or discharge union sym- pathizers or threats to discontinue benefits such as coffee breaks, wash-up time, or employee discounts.


The Board has developed a body of rules that impose restrictions on the preelection activities of the parties. The Board prohibits all electioneering activities at polling places.80 The Board, in its Peerless Plywood decision,81 formulated its “24-hour rule,” which prohibits both unions and employers from delivering speeches to cap- tive audiences within 24 hours of an election. The obvious rationale for such a rule is to preserve free elections and prevent any party from obtaining undue advantage. In its Excelsior Underwear decision,82 the Board promulgated a rule requiring an employer to provide a list of names and addresses of all employees eligible to vote in a representation election. The so-called Excelsior List must be filed with the regional director within seven days after an election has been directed or agreed upon. This list is then made available to the union or unions seeking to represent the employees. In Woodman’s Food Markets, Inc.,83 the Board held that in deter- mining whether an employer has substantially complied with its obligation under the Excelsior rule, it will continue to consider the percentage of omissions from the voter eligibility list; it will consider other factors as well, including whether the number of omissions is determinative and whether it equals or exceeds the number of additional votes needed by the union to prevail in the election. It will also con- sider the employer’s explanation for the omissions. The Board noted that its Excel- sior policy was designed to enhance the availability of information and arguments both for and against union representation to employees so that they might render

80 Alliance Ware, Inc., 92 NLRB 55 (1950); Michelm, Inc., 170 NLRB 46 (1968). 81 Peerless Plywood Co., 107 NLRB 427 (1953). 82 Excelsior Underwear, Inc., 156 NLRB 1236 (1966). The rule was accepted by the Supreme Court in NLRB v. Wyman-Gordan Co., 394 U.S. 759 (1969). 83 332 NLRB No. 48 (2000).


a more informed judgment at the ballot box. In the Board’s Merchant’s Transfer Co.84 decision, where the union lost an election by two votes and the Excelsior list provided by the employer contained 13 incorrect addresses out of 58 employees, the hearing officer found that the employer acted in a “grossly negligent manner” in assembling the list. The election was set aside, and a rerun election ordered.

Violation of the previous rules and other rules promulgated by the Board is grounds for setting aside an election even if the conduct does not amount to an unfair labor practice. Conduct that is an unfair labor practice under the Act is also viewed as a violation of the Board’s election rules.85


Section 8(c) states that “the expressing of any views, argument, or opinion … shall not constitute or be evidence of an unfair labor practice … if such expression con- tains no threat of reprisal or force or promise of benefit.”

The Supreme Court, in the NLRB v. Gissel Packing Co. case, reported in this section, considered the question of whether certain specific statements made by an employer to its employees constituted an election-voiding threat of reprisal and thus fell outside the protection of the First Amendment and Section 8(c) of the Act. In Gissel, the Court established guidelines for employer preelection statements and predictions concerning the effect of unionization on a company. An employer is free to state only what the employer reasonably believes will be the likely eco- nomic consequences of unionization that are outside the employer’s control.

However, in Chamber of Commerce of the United States v. Brown, the Supreme Court referenced the statement in Gissel by the Court that Section 8(c) “merely implements the First Amendment,” but the Chamber of Commerce Court pointed out that the enactment of Section 8(c) also manifested a congressional intent to encourage free debate on issues dividing labor and management.86 In the Chamber of Commerce v. Brown decision, the Court found that a California stat- ute prohibiting employers that receive state grants or funds of more than $10,000 per year from using any portion of these funds “to assist, promote, or deter union organizing” was preempted by the NLRA under the Machinists v. Wisconsin Employment Relations Commission rule. Section 7 and Section 8(a), Section 8(b), and Section 8(c) protect noncoercive speech by employers, employees, and unions.

Just as the free speech proviso of Section 8(c) of the Act will not protect an employer whose statements are found to be a threat of reprisal and a violation of Section 8(a)(1), so also a promise of benefit by an employer who times the promise to influence a representation election also violates Section 8(a)(1). This is known as the Exchange Parts rule.87 In Hineline’s Meat Plant, Inc.,88 the

84 330 NLRB 1165 (2000). 85 Dal-Tex Optical Co., 137 NLRB 1782 (1962). 86 The Chamber of Commerce v. Brown decision is presented in Section 4:8. Note that the Chamber of Commerce decision is built on the Gissel precedent, yet the tone of Chamber of Commerce is more expansive, “favoring uninhibited, robust and wide-open debate in labor disputes.” 87 NLRB v. Exchange Parts Co., 375 U.S. 405 (1964). 88 193 NLRB 135 (1971).


Board set aside an election when the employer announced a new profit-sharing plan to employees 11 days before the election. Relying on the Exchange Parts rule, the Board found that because the announcement could have been delayed until after the election, it was possible that the company had timed the announce- ment to influence the employees’ vote. Consequently, the Board found a violation of Section 8(a)(1) and set aside the election.


While Section 7 of the Act gives employees the statutory right to self-organization, employers have the undisputed prerogative to make rules to maintain discipline in their establishments. Republic Aviation Corp. v. NLRB89 is the seminal case balanc- ing those interests with respect to oral solicitation in the workplace. The employer in Republic Aviation maintained a rule prohibiting solicitation anywhere on company property and discharged an employee for soliciting for the union during nonworking time. The Board adopted a presumption that restricting oral solicition on nonwork- ing time was unlawful, absent special circumstances. The Supreme Court affirmed the Board’s finding that the employer’s rule and its enforcement violated Section 8 (a)(1). Although the solicitation occurred on the employer’s property, the Court found insufficient justification to allow the employer to prohibit it. Generally speak- ing, employers may prohibit union solicitation by employees during work periods. During nonworking time, however, employers may prohibit activity and communica- tion only if legitimate efficiency and safety reasons exist and if the prohibitions are not manifestly intended to impede employees’ exercise of their rights under Section 7. In the Armstrong Tire case, the Board stated that “[t]he burden rests upon an employer to establish that safety conditions actually require an invasion of the normal exercise by his employees of self-organization rights during nonworking time.”90

DISTRIBUTION OF LITERATURE. In Eastex v. NLRB,91 the Supreme Court held that employees have a right under the “mutual aid or protection” language of Section 7 of the NLRA to distribute a newsletter in nonworking areas of the plant during non- working time. The newsletter in Eastex set forth the union’s views on right-to-work laws and on a presidential veto of a minimum-wage bill. The Court found that the employees were already rightfully on the employer’s property, so it was up to the company to show that its management interests would be prejudiced by distribution of the newsletter to which it objected. The Court found that the company had made no such showing. The Court stated that any incremental intrusion on the company’s property rights from the distribution would be minimal.

E-MAIL AND SECTION 7. The Labor Board’s Register-Guard92 decision involved a case of first impression before the agency. The Eugene Newspaper Guild represents

89 324 U.S. 793 (1945). 90 Armstrong Tire and Rubber Co., 119 NLRB 382 (1958). 91 437 U.S. 556 (1978). 92 The Guard Publishing Co. dba The Register-Guard, 351 NLRB No. 70 (2007).


some 150 employees of the Register-Guard, a newspaper in Eugene, Oregon. The employer had a written policy that prohibited use of company-owned communica- tion systems, including e-mail, for “non-job-related solicitations.” The union alleged that the policy and its enforcement against the union president for sending three union-related e-mails was a violation of the NLRA. In a 3–2 decision, the Board majority found that absent discrimination against the union, employees have no statutory right to use company-owned e-mail for Section 7 communications regarding union business. The ALJ determined that because the employer had per- mitted personal use of e-mails for a wide variety of nonbusiness purposes, it could not validly prohibit e-mails dealing with Section 7 subjects. The Board majority, however, fashioned a new policy on what constitutes discriminatory enforcement by adopting the Seventh Circuit Court of Appeals’ analysis that unlawful discrimination consists of disparate treatment of communications of a similar character.93 Thus, although the employer in practice permitted personal e-mail solicitations, the employer had not permitted e-mails soliciting support for any outside organization. The Board viewed the union as an outside organization and determined that the employer lawfully enforced its policy regarding two August e-mails sent by the union president, Suzi Prozanski, that solicited support for the union.

On review in Guard Publishing Co. v. NLRB, the U.S. Court of Appeals for the District of Columbia concluded that substantial evidence of record did not sup- port the Board’s finding that the employer lawfully disciplined Ms. Prozanski for sending two union solicitation e-mails in August 2000 because they were organiza- tional, not personal, solicitations. The court stated in part:

In short, neither the company’s written policy nor its express enforcement rationales relied on an organizational justification. The August memo gave only one explanation for disciplining Prozanski: she had “use[d] the system for dissemination of union information.” Thus, the Board’s observation concerning the May disciplinary warning— that it was “clear from the warning itself that the [Register-Guard] disciplined Prozanski for sending a union-related e-mail”—was equally true of the August warning. Indeed, in practice the only employee e-mails that had ever led to discipline were the union-related e-mails at issue here. (“[T]here was no enforcement of the communications policy on nonbusiness use, other than union use, of communications equipment.”) On this record, substantial evidence does not support the Board’s determination that Prozanski was disciplined for a reason other than that she sent a union-related e-mail.94

NECESSITY OF NONDISCRIMINATORY ENFORCEMENT OF RULES. Employers have every right to establish work rules to properly conduct their businesses. In St. Margaret Mercy Healthcare Centers v. NLRB,95 a hospital rule forbade solicitation in patient care areas. Under this rule, a nurse received a disciplinary sanction for engaging in union solicitation at a nurses’ station. The Board found that “employee solicitation at the nurses’ station was a common practice, and included a wide variety

93 See Fleming Cos. v. NLRB, 349 F.3d 968 (7th Cir. 2003); Guardian Industries Corp. v. NLRB, 49 F.3d 317 (7th Cir. 1999). 94 571 F.3d 53 (D.C. Cir. 2009). On remand from the Court of Appeals, the Board accepted the court’s opinion as the law of the case, 357 NLRB No. 27 (July 26, 2011). 95 519 F.3d 373 (2208).


of solicitations, including solicitations for Girl Scout cookies, March of Dimes, United Way, Secretary’s Day and Boss’ Day, and ‘going away’ parties, and other social occasions, and the hawking of ‘beach balm’ a product ‘created by a registered nurse to control bikini line irritation.’” Moreover, management was aware of these solicitations and even participated in some of them. The Court of Appeals for the Seventh Circuit considered that with the exception of the balm, the solicitations were charitable or social rather than commercial. The court rhetorically asked, “But what difference can that make? The hospital’s rule forbids solicitations in patient care areas, period, yet the only solicitations in patient care areas that have ever drawn a rebuke from management are … those in support of union activities.” The court found that substantial evidence of record supported the finding that the hospi- tal discriminated against the nurse in violation of Section 8(a)(3) for engaging in union solicitation at the nurses’ station.


Section 7 of the NLRA grants all employees—union and nonunion—the right to engage in protected concerted activities pertaining to self-organization, forming, joining, or assisting a union or “for other mutual aid or protection.” Under Section 7, employees have a right to discuss their terms and conditions of employ- ment with coworkers. Some employers’ Internet and social media policies may be overly broad in that they may tend to chill employees’ exercise of their Section 7 rights. For example, American Medical Response of Connecticut (AMR), an ambulance service, terminated an employee in part for posting unfavorable remarks about her supervisor on her Facebook page. The employee, Ms. Souza, had mocked her supervisor on her Facebook page; when she received supportive comments from some coworkers, she posted additional remarks about the super- visor and was terminated. AMR’s company handbook contained several policy provisions about blogging and Internet postings, including prohibiting employees from making “disparaging, discriminatory or defamatory comments when dis- cussing the company or the employee’s supervisors, co-workers and/or competitors.” The acting Regional Director issued an unfair labor practice com- plaint against AMR, asserting that AMR enforced an overly broad policy on blogging and Internet posting. The matter settled before the scheduled hearing before the ALJ. Although other Facebook firing cases are in the settlement, com- plaint or ALJ96 stages of Board procedures, no Facebook discipline decisions have

96 See the ALJ’s ruling in Hispanics United of Buffalo, 3-CA-27872 (September 2, 2011), where the ALJ followed the Board’s Parexel International LLC “concerted activity” precedent, 356 NLRB No. 82 (Jan. 28, 2011), finding that the nonunion nonprofit organization unlawfully terminated five employees who had posted comments on Facebook, some of which were profane and sarcastic, in response to a co-worker, Cruz-Moore’s complaint about their job performance. The ALJ stated in part:

…The discriminatees herein were taking a first step towards taking group action to defend themselves against the accusations they could reasonably believe Cruz-Moore was going to make to management. By discharging the discriminatees on October 12, Respondent prevented them from taking any further group action vis-à-vis Cruz-Moore’s criticisms. Moreover, the fact that Respon- dent lumped the discriminatees together in terminating them, establishes that Respondent viewed the five as a group and that their activity was concerted.…


yet been rendered by the Board. Though employees retain the right to talk about working conditions on social media, including discussing treatment by a supervi- sor in blunt language, case law will develop that not only protects Section 7 rights, but also protects employer rights to make rules to maintain discipline in the workplace and to protect the employer’s reputation when a Facebook conver- sation on a page set to allow access to “friends of friends” involves very offen- sive, insulting, and disrespectful comments about supervisors or managers. The latter situation is not like a conversation between employees at a water cooler, where there is an expectation of privacy, but is more like calling the boss names on the plant floor in front of multiple employees and the public, as there is no expectation of privacy. This conduct does not involve protected concerted activity. Although discussion of grievances in the context of “mutual aid or protection” is protected under Section 7, an individual’s personal griping is not.


[Partial statement of facts relating to the Sinclair Company, one of the four cases considered by the Court in its Gissel opinion.

After the president of the company learned of the union’s organizational drive, he made speeches, issued pamphlets and leaflets, and sent letters conveying the message that the union was strike-happy and that a vote for the union could result in the plant’s being shut down. Moreover, he informed the employees that because of their age, they could have difficulty finding other employment. The union lost the election, and the union filed charges before the Board. The Board found that under the “totality of the circum- stances,” the company’s activities amounted to a vio- lation of Section 8(a)(1). Because the company’s activities tended to foreclose the possibility of holding a fair new election, it ordered the company to bargain as requested with the union. The Court of Appeals for the First Circuit enforced the Board’s order, and the company appealed to the Supreme Court, arguing that the statements made by the employer were pro- tected by the First Amendment and that a bargaining order was inappropriate.]

WARREN, C. J.… … We consider finally petitioner Sinclair’s First Amendment challenge to the holding of the Board and the Court of Appeals for the First Circuit.

At the outset we note that the question raised here most often arises in the context of a nascent union organizational drive, where employers must be careful in waging their antiunion campaign. As to conduct generally, the … gradations of unfair labor practices, with their varying consequences, create certain hazards for employers when they seek to esti- mate or resist unionization efforts. But so long as the differences involve conduct easily avoided, such as discharge, surveillance, and coercive interrogation, we do not think that employers can complain that the distinctions are unreasonably difficult to follow. Where an employer’s antiunion efforts consist of speech alone, however, the difficulties raised are not so easily resolved. The Board has eliminated some of the problem areas by no longer requiring an employer to show affirmative reasons for insisting on an elec- tion and by permitting him to make reasonable inqui- ries. We do not decide, of course, whether these allowances are mandatory. But we do note that an employer’s free speech right to communicate his views to his employees is firmly established and cannot be infringed by a union, or the Board. Thus, Section 8(c) merely implements the First Amendment by requiring that the expression of “any views, argu- ment or opinion” shall not be “evidence of an unfair labor practice,” so long as such expression contains “no threat of reprisal or force or promise of benefit”



in violation of Section 8(a)(1). Section 8(a)(1), in turn, prohibits interference, restraint or coercion of employees in the exercise of their right to self- organization.

Any assessment of the precise scope of employer expression, of course, must be made in the context of its labor relations setting. Thus, an employer’s rights cannot outweigh the equal rights of the employees to associate freely, as those rights are embodied in Sec- tion 7 and protected by Section 8 (a)(1) and the pro- viso to Section 8(c). And any balancing of those rights must take into account the economic dependence of the employees on their employers, and the necessary tendency of the former, because of that relationship, to pick up intended implications of the latter that might be more readily dismissed by a more disinter- ested ear. Stating these obvious principles is but another way of recognizing that what is basically at stake is the establishment of a non-permanent, limited relationship between the employer, his economically dependent employee and his union agent, not the election of legislators or the enactment of legislation whereby that relationship is ultimately defined and where the independent voter may be freer to listen more objectively and employers as a class freer to talk. Compare New York Times Co. v. Sullivan, 376 U.S. 254 (1964).

Within this framework, we must reject the Com- pany’s challenge to the decision below and the find- ings of the Board on which it was based. The standards used below for evaluating the impact of an employer’s statements are not seriously questioned by petitioner and we see no need to tamper with them here. Thus, an employer is free to communicate to his employees any of his general views about unionism or any of his specific views about a particular union, so long as the communications do not contain a “threat of reprisal or force or promise of benefit.” He may even make a prediction as to the precise effects he believes unionization will have on his company. In such a case, however, the prediction must be carefully phrased on the basis of objective fact to convey an employer’s belief as to demonstrably probable conse- quences beyond his control or to convey a manage- ment decision already arrived at to close the plant in case of unionization. See Textile Workers v. Darling- ton Mfg. Co., 380 U.S. 263, 274, n. 20 (1965). If there is any implication that an employer may or may not take action solely on his own initiative for reasons unrelated to economic necessities and known only to him, the statement is no longer a reasonable

prediction based on available facts but a threat of retaliation based on misrepresentation and coercion, and as such without the protection of the First Amendment. We therefore agree with the court below that “conveyance of the employer’s belief, even though sincere, that unionization will or may result in the closing of the plant is not a statement of fact unless, which is most improbable, the eventu- ality of closing is capable of proof.” 397 F.2d, at 160. As stated elsewhere, an employer is free only to tell “what he reasonably believes will be the likely eco- nomic consequences of unionization that are outside his control,” and not “threats of economic reprisal to be taken solely on his own volition.” NLRB v. River Togs, Inc., 382 F.2d 198, 202 (C.A. 2d Cir. 1967).

Equally valid was the finding by the court and the Board that petitioner’s statements and commu- nications were not cast as a prediction of “demon- strable economic consequences,” 397 F.2d 157, 160, but rather as a threat of retaliatory action. The Board found that petitioner’s speeches, pamph- lets, leaflets, and letters conveyed the following mes- sage: That the company was in a precarious financial condition; that the “strike-happy” union would in all likelihood have to obtain its potentially unreasonable demands by striking, the probable result of which would be a plant shutdown, as the past history of labor relations in the area indicated; and that the employees in such a case would have great difficulty finding employment elsewhere. In carrying out its duty to focus on the question “What did the speaker intend and the listener understand,” Cox, Law and the National Labor Policy 44 (1960), the Board could reasonably con- clude that the intended and understood import of that message was not to predict that unionization would inevitably cause the plant to close but to threaten to throw employees out of work regardless of the economic realities. In this connection, we need go no further than to point out (1) that peti- tioner had no support for its basic assumption that the union, which had not yet even presented any demands, would have to strike to be heard, and that it admitted at the hearing that it had no basis for attributing other plant closings in the area to unionism; and (2) that the Board has often found that employees, who are particularly sensitive to rumors of plant closings, take such hints as coercive threats rather than honest forecasts.

Petitioner argues that the line between so-called permitted predictions and proscribed threats is too




During a representation election campaign, it is inevitable that statements will be made that are factually inaccurate. It is up to the parties to correct the misstate- ments, half-truths, allegations, or inaccuracies of their opponent. Ultimately, it is up to the employees to evaluate the statements made by employer representatives and union advocates in making their decision to vote for or against union represen- tation. Under certain circumstances when one party does not have an opportunity to reply, a campaign misrepresentation could very well affect the outcome of an election. The Board has been called upon by the losing parties to set aside such elections and to order rerun elections on the basis of violation of its electioneering rules, even though the conduct did not amount to an unfair labor practice. The Board’s changing position on this matter is discussed later on.

In Bausch & Lomb, Inc., v. NLRB,97 the Second Circuit Court affirmed the NLRB’s invalidation of a representation election in which an employer mailed a let- ter to employees two days before the election, informing them that the union local at another company plant had recently agreed to a contract without a Christmas bonus provision. The letter failed to mention that the union had obtained a wage increase and extended sick pay in exchange for dropping its Christmas bonus demand. The union lost the election. In rejecting the company’s allegation that the Board had abused its discretion in invalidating the election, the court noted that the test set forth in the Board’s Hollywood Ceramics98 case had been satisfied. First, the misstatement was of a material fact; the employees would obviously be con- cerned with such a valuable right. Second, the union did not have time to reply; the letter was received just two days prior to the election. Third, the company was

vague to stand up under traditional First Amendment analysis and that the Board’s discretion to curtail free speech rights is correspondingly too uncontrolled. It is true that a reviewing court must recognize the Board’s competence in the first instance to judge the impact of utterances made in the context of the employer- employee relationship, seeNLRB v. Virginia Electric & Power Co., 314 U.S. 469, 479 (1941). But an employer, who has control over that relationship and therefore knows it best, cannot be heard to complain that he is without an adequate guide for his behavior. He can easily make his views known without engaging in “brinkmanship” when it becomes all too easy to “overstep and tumble over the brink,” Wausau Steel Corp. v. NLRB, 377 F.2d 369, 372 (C.A. 7th Cir.

1967). At the least he can avoid coercive speech simply by avoiding conscious overstatements he has reason to believe will mislead his employees.


Case Questions

1. State the basis of Sinclair’s challenge to the Board’s decision.

2. Discuss the free speech differences between a union representation election and the election of a legislator or the enactment of legislation.

3. What standards did the Supreme Court set forth for evaluating employer statements to employees during an organizational campaign?

97 451 F.2d 873 (2d Cir. 1971). 98 140 NLRB 221 (1962).


in a position to have “special knowledge” of the facts. Finally, the employees lacked independent knowledge with which to evaluate the statement.

In 1977, after 15 years’ experience under Hollywood Ceramics, a majority of the Board decided in Shopping Kart Food Market, Inc.,99 over a vigorous dissent, to overrule Hollywood Ceramics. The Board stated in Shopping Kart that it would “no longer probe into the truth or falsity of the parties’ campaign statements” but would instead recognize and rely on employees “as mature individuals who are capable of recognizing campaign propaganda for what it is and discounting it.” The majority also held that the Board would intervene “in instances where a party has engaged in such deceptive campaign practices as improperly involving the Board and its processes, or the use of forged documents which render the voters unable to recognize the propaganda for what it is.” Twenty months after its Shop- ping Kart decision, a Board majority reversed Shopping Kart and reinstated its Hollywood Ceramics rule.100 Reversing itself again four years later, a Board major- ity reverted to the Shopping Kart policy in its Midland National Life Insurance decision.101 As presently applied, the Shopping Kart-Midland National Life rule applies to misrepresentations by either side. And, as is evident from the North American Directory decision,102 the rule is now court-approved.


[E.A. Sween distributes food, primarily to 7-Eleven stores in the Chicago area. The Teamsters union peti- tioned the Board to conduct a representation election for the company’s truck drivers, and an election was scheduled for August 29, 2008. On the evening of August 28, before the drivers left for their evening shifts, the union distributed to the drivers a one- page flyer touting the benefits the union could bring. Of the 38 eligible voters, 26 voted for the union and 12 voted against. E.A. Sween filed an objection with the Board. It contended that the flyer “used forged and misrepresented documents and quotes” that were falsely attributed to the Supreme Court. According to the company, these quotes were presented in such a manner that employees would not have been able to recognize them as union propa- ganda. E.A. Sween also argued that it had insufficient time to rebut the false information. It contended that

the flyer improperly influenced the employees to vote for the union. The hearing officer found that the flyer did not interfere with the employees’ ability to make a free choice and recommended that the Board certify the union. On November 19, 2010, the Board, by a three-member panel, issued a decision finding that the company’s refusal to bargain violated Sections 8(a)(1) and (5). The Board ordered the company to bargain with the union. With E.A. Sween persisting in its refusal to bargain, the Board filed this application for court enforcement.]

LEFKOW, D. J. … E.A. Sween argues … that the election should be set aside because the Union’s campaign flyer was deceptive and misleading and because the flyer was a forgery. Under Midland National Life Ins. Co., the Board will not “probe into the truth or falsity of


99 228 NLRB 1311 (1977). 100 General Knit of California, Inc., 239 NLRB 619 (1978). 101 263 NLRB 387 (1982). 102 North American Directory Corp. v. NLRB, 939 F.2d 74 (3d Cir. 1991).



In NLRB v. Gissel Packing Co., portions of which are reported in this section, the Supreme Court set forth the law regarding Board bargaining orders based on authorization cards. The bargaining order remedy is utilized by the Board in the following type of situation. A union conducts an organizational campaign and obtains authorization cards from a majority of the employees in an appropriate bargaining unit.103 On the basis of these cards, the union demands recognition,

the parties’ campaign statements, [or] set elections aside on the basis of misleading campaign statements. [It] will, however, intervene in cases where a party has used forged documents which render the voters unable to recognize propaganda for what it is.” The rationale for the rule is that employees are “‘mature individuals who are capable of recognizing campaign propaganda … and discounting it’ ”Id. at 130 (quot- ing Shopping Kart Food Market, Inc., 228 N.L.R.B. 1311, 1313 (1977)).

E.A. Sween urges focus on the first sentence: “THE U.S. SUPREME [sic] HAS HELD THAT ALL [sic] TERMS AND CONDITIONS OF EMPLOYMENT BY LAW MUST REMAIN THE SAME UNTIL AND DURING CONTRACT NEGOTIATIONS OR APPROVED BY EMPLOYEES.” Irrespective of whether it is deceptive or misleading, the sentence is certainly not a “forgery”—a counterfeit—of a Supreme Court decision. It is not explicitly attributed to the Supreme Court; neither does the quoted portion reflect language or syntax a learned justice would possibly use.

Failing that, E.A. Sween argues that the first sen- tence led employees to believe that the quoted text was the holding of a Supreme Court case, a deception that justifies our adopting the Sixth Circuit’s exception to Midland in circumstances “where no forgery can be proved, but … the misrepresentation is so pervasive and the deception so artful that employees will be unable to separate truth from untruth and … their right to free and fair choice will be affected.” NLRB v. Hub Plastics, 52 F. 3d 608, 612 (6th Cir. 1995). As this court has previously recognized, however, there is no need to determine the limits of Midland where the “situation … fall[s] squarely in the heartland of

the Midland doctrines—statements regarding a cam- paign issue that voters could easily recognize as propaganda.” Far from artfully deceptive, the first sen- tence makes no sense. Apparently the author recog- nized as much because the second sentence explains the first with an essentially correct statement of the law: “THAT STATEMENT MEANS THAT IF YOU ARE DUE A SCHEDULED RAISE AT ANY TIME DURING THE CONTRACT NEGOTIATION PERIOD, BY LAW THE COMPANY MUST GIVE YOU THAT RAISE.” Whether the first sentence is misleading or simply meaningless, the second sentence clearly explains what the Union intended to convey.

The findings of the Board that the statement was not a forgery and, although misleading, did not jus- tify setting aside the election, is neither without sub- stantial evidentiary basis in the hearing record nor based on an incorrect statement of the law.

Conclusion Accordingly, the Board’s application for an order judicially enforcing its entire order is granted.

Case Questions

1. What is the rationale for the Shopping Kart– Midland National Life Insurance decision?

2. Was the employees’ right to free and fair choice affected by the focus sentence beginning with “THE U.S. SUPREME [sic] HAS HELD…” because the misrepresentation was so pervasive and the deception so artful that employees would not be able to separate the truth from the untruth?

103 The Gissel decision included four separate cases that were heard before the Supreme Court at the same time. The cards used in all four campaigns unambiguously authorized the union to represent the signing employee for collective bargaining purposes; there was no reference to elections.


which is refused on the grounds that the cards are inherently unreliable indicators of employee desires. The employer then conducts an antiunion campaign, during which the employer commits unfair labor practices. Following the union loss and the filing of charges with the Board, the Board will set aside the election if it finds that the unfair labor practices had the effect of undermining the union’s majority. The Board will then either order a rerun election or, if the employer’s conduct was so pervasive as to render a fair rerun election unlikely, certify the union on the basis of its authorization-card majority and order the employer to bargain with it.

Certain employer violations are consistently regarded by the Board and the courts as highly coercive of employees’ Section 7 rights. These violations, sometimes referred to as hallmark violations, will support the issuance of a Gissel bargaining order unless some significant mitigating circumstance exists.104 Hallmark violations include plant closures or threats of plant closures, unlawful discharge of union adherents, threats of job loss, or granting of significant benefits to employees.105

In its Mercedes Benz of Orland Park106 decision, the Board restated the basis for evaluating the appropriateness of a Gissel bargaining order, stating:

In Gissel, the Supreme Court “identified two types of employer misconduct that may warrant the imposition of a bargaining order; outrageous and pervasive unfair labor practices (category I) and less extraordinary cases marked by less pervasive practices which nonetheless still have the tendency to undermine majority strength and impede the election processes (category II).” The Court found that, in determining a remedy in category II cases, the Board can take into consideration the extensiveness of an employer’s unfair labor practices in determining whether the “possibility of erasing the effects of past practices and ensuring a fair election … by the use of traditional reme- dies, though present, is slight and employee sentiments once expressed by authorization cards would, on balance, be better protected by a bargaining order.”

In Gissel, the Supreme Court left undetermined the issue of whether it would be appropriate to find a Section 8(a)(5) violation and grant a bargaining order in cases in which the employer has knowledge, on the basis of cards or other circum- stantial evidence, that the union has a valid majority and the employer refuses to recognize the union but refrains from committing independent unfair labor prac- tices. In Summer & Co. (Linden Lumber) v. NLRB,107 the Supreme Court addressed this issue, holding that absent independent unfair labor practices, a bar- gaining order will not be issued unless the employer and the union have agreed on an alternate means of resolving the issue of majority status. Where such an agree- ment has not been undertaken, the Court ruled that the burden of invoking the Board’s election procedures is on the union seeking to represent the employer’s workers. The policy to be served by the Linden rule is that of encouraging volunta- rism while ensuring that the preferred route of a secret election is available to those who do not find any alternate route more acceptable.

104 Michael’s Painting, Inc., 377 NLRB No. 140 (2002); NLRB v. Center Construction Co. 482 F.3d 425 (6th Cir. 2007). 105 See General Counsel Memorandum 99-8, November 10, 1999. 106 333 NLRB No. 127, slip op. at 1 (2001). 107 419 U.S. 301 (1974).



[The portion of this case dealing with Sinclair’s First Amendment challenges to the holding of the Board and the Court of Appeals for the First Circuit (Case No. 585) is reported in Section 4:14.]

[Three cases from the Fourth Circuit—Gissel, Heck’s, and General Steel—were consolidated with the Sinclair case for the Court’s consideration. In each of the Fourth Circuit cases, the union obtained authorization cards from a majority of the employees in an appropriate bargaining unit and demanded rec- ognition. In each instance, the employer refused to recognize the unions on the ground that authoriza- tion cards were inherently unreliable indicators of employee desires. Each employer then waged an anti- union campaign, during which it committed numer- ous unfair labor practices. In Gissel and Heck’s, the Board ordered the employers to bargain even though an election had not been held. In General Steel the Board set aside the election, which the union had lost, and the employer was ordered to bargain on the basis of preelection unfair labor practices. In each case the Board ruled that the union had valid authorization cards from a majority of the employees in an appropriate unit, and, found that the employer’s refusal to bargain “was motivated not by a ‘good faith’ doubt of the unions’ majority status, but by a desire to gain time to dissipate that status.” The Fourth Circuit refused to enforce the Board’s orders to bargain, but affirmed the other unfair labor prac- tice findings. The facts in Sinclair were similar to the Fourth Circuit cases, but the First Circuit enforced the Board’s order.]

WARREN, C. J.… The specific questions facing us here are whether the duty to bargain can arise without a Board election under the Act; whether union authorization cards, if obtained from a majority of employees without mis- representation or coercion, are reliable enough gener- ally to provide a valid, alternate route to majority status; whether a bargaining order is an appropriate and authorized remedy where an employer rejects a card majority while at the same time committing unfair labor practices that tend to undermine the union’s majority and make a fair election an unlikely

possibility; and whether certain specific statements made by an employer to his employees constituted such an election-voiding unfair labor practice and thus fell outside the protection of the First Amend- ment and Section 8(c) of the Act. For reasons given below, we answer each of these questions in the affirmative….

…Under the Cumberland Shoe doctrine, if the card itself is unambiguous (i.e., states on its face that the signer authorizes the Union to represent the employee for collective bargaining purposes and not to seek an election), it will be counted unless it is proved that the employee was told that the card was to be used solely for the purpose of obtaining an election….

The first issue facing us is whether a union can establish a bargaining obligation by means other than a Board election and whether the validity of alternate routes to majority status, such as cards, was affected by the 1947 Taft-Hartley amendments. The most commonly traveled route for a union to obtain recognition as the exclusive bargaining repre- sentative of an unorganized group of employees is through the Board’s election and certification proce- dures under Section 9(c) of the Act; it is also, from the Board’s point of view, the preferred route. A union is not limited to a Board election, however….

In short, we hold that the 1947 amendments did not restrict an employer’s duty to bargain under Sec- tion 8(a)(5) solely to those unions whose representa- tive status is certified after a Board election.

We next consider the question whether authoriza- tion cards are such inherently unreliable indicators of employee desires that whatever the validity of other alternate routes to representative status, the cards themselves may never be used to determine a union’s majority and to support an order to bargain….

That the cards, though admittedly inferior to the election process, can adequately reflect employee sen- timent when that process has been impeded, needs no extended discussion, for the employers’ contentions cannot withstand close examination. The employers argue that their employees cannot make an informed choice because the card drive will be over before the employer has had a chance to present his side of the unionization issues. Normally, however, the union



will inform the employer of its organization drive early in order to subject the employer to the unfair labor practice provisions of the Act; the union must be able to show the employer’s awareness of the drive in order to prove that his contemporaneous conduct constituted unfair labor practices on which a bargain- ing order can be based if the drive is ultimately successful….

The employers’ second complaint, that the cards are too often obtained through misrepresentation and coercion, must be rejected also in view of the Board’s present rules for controlling card solicitation, which we view as adequate to the task where the cards involved state their purpose clearly and unam- biguously on their face. We would be closing our eyes to obvious difficulties, of course, if we did not recog- nize that there have been abuses, primarily arising out of misrepresentations by union organizers as to whether the effect of signing a card was to designate the union to represent the employee for collective bar- gaining purposes or merely to authorize it to seek an election to determine that issue. And we would be equally blind if we did not recognize that various courts of appeals and commentators have differed significantly as to the Board’s Cumberland Shoe doctrine to cure such abuses.

In resolving the conflict among the circuits in favor of approving the Board’s Cumberland rule, we think it sufficient to point out that employees should be bound by the clear language of what they sign unless that language is deliberately and clearly canceled by a union adherent with words cal- culated to direct the signer to disregard and forget the language above his signature. There is nothing inconsistent in handing an employee a card that says the signer authorizes the union to represent him and then telling him that the card will probably be used first to get an election. Elections have been, after all, and will continue to be, held in the vast majority of cases; the union will still have to have the signatures of 30 percent of the employees when an employer rejects a bargaining demand and insists that the union seek an election. We cannot agree with the employers here that employees as a rule are too unsophisticated to be bound by what they sign unless expressly told that their act of signing represents something else. In addition to approving the use of cards, of course, Congress has expressly authorized reliance on employee signatures alone in other areas of labor relations, even where criminal

sanctions hang in the balance, and we should not act hastily in disregarding congressional judgments that employees can be counted on to take responsi- bility for their acts….

Remaining before us is the propriety of a bargain- ing order as a remedy for a Section 8(a)(5) refusal to bargain where an employer has committed indepen- dent unfair labor practices which have made the hold- ing of a fair election unlikely or which have in fact undermined a union’s majority and caused an elec- tion to be set aside. We have long held that the Board is not limited to a cease and desist order in such cases, but has the authority to issue a bargaining order without first requiring the union to show that it has been able to maintain its majority status…. And we have held that the Board has the same authority even where it is clear that the union, which once had possession of cards from a majority of the employees, represents only a minority when the bargaining order is entered. Franks Bros. Co. v. NLRB, 321 U.S. 702 (1944). We see no reason now to withdraw this authority from the Board. If the Board could enter only a cease and desist order and direct an election or a rerun, it would in effect be rewarding the employer and allowing him “to profit from [his] own wrongful refusal to bargain,” Frank Bros. supra, at 704, while at the same time severely curtail- ing the employees’ right freely to determine whether they desire a representative. The employer could con- tinue to delay or disrupt the election process and put off indefinitely his obligation to bargain,* and any election held under these circumstances would not be likely to demonstrate the employees’ true, undis- torted desires.…**

… If the Board finds that the possibility of erasing the effects of past practices and of ensuring a fair election (or a fair rerun) by the use of traditional rem- edies, though present, is slight and that employee


*The Board indicates here that its records show that in the period between January and June 1968, the median time between the filing of an unfair labor practice charge and a Board decision in a con- tested case was 388 days. But the employer can do more than just put off his bargaining obligation by seeking to slow down the Board’s administrative processes. He can also affect the outcome of a rerun election by delaying tactics, for figures show that the longer the time between a tainted election and a rerun, the lesser are the union’s chances of reversing the outcome of the first election.

**A study of 20,153 elections held between 1960 and 1962 shows that in over two-thirds of the cases, the party who caused the elec- tion to be set aside won in the rerun election. See Pollitt, NLRB Rerun Elections: A Study, 41 N.C.L. Rev. 209, 212 (1963).



A complete treatment of all remedy possibilities is beyond the scope of this section. Orders against employer and union unfair labor practices are tailored to rectify the varied and sometimes unique misconduct in individual cases. The number of possi- bilities is great. Under Section 9 of the NLRA, the Board has authority to issue appropriate orders to remedy a broad range of violations concerning representation matters. For example, the previous section discussed how the Gissel bargaining order remedy was established.


Section 10(j) of the NLRA empowers the Board, in its discretion, to petition a U.S. district court for appropriate, temporary injunctive relief or restraining order in unfair labor practice proceedings. Section 100(j) proceedings can be initiated after issuance of an unfair labor practice complaint under Section 10(b) of the Act against any employer or labor organization. Any injunction issued under Section 10(j) lasts until final disposition of the unfair labor practice case by the Board. The General Counsel instituted a priority action program to seek a speedy Section 10(j) remedy in every meritorious unfair labor case alleging discriminatory termination of an employee during a union organizing effort, because an unremedied firing “nips in the bud” employee efforts to organize themselves and intimidates other employees from exercising their statutory rights.108 For example, the Board obtained a Section 10(j) injunction in the U.S. district court in Honolulu on March 29, 2010, against the owners of the Pacific Beach Hotel, requiring in part the interim reinstatement of five employees. On June 14, 2011, the Board, after completing its administrative proceedings, ordered the hotel to stop unfair labor practices, recognize and bargain with the union for an initial contract, rescind unilateral

108 Office of the General Counsel, Memorandum GC 10-07 (Sept. 30, 2010).

sentiment once expressed through cards would, on balance, be better protected by a bargaining order, then such an order should issue….

We emphasize that under the Board’s remedial power there is still a third category of minor or less extensive unfair labor practices, which, because of their minimal impact on the election machinery, will not sustain a bargaining order. There is, the Board says, no per se rule that the commission of any unfair practice will automatically result in a Section 8(a)(5) violation and the issuance of an order to bargain….

It is so ordered.

Case Questions

1. Summarize the Cumberland Shoe doctrine. 2. What did the Supreme Court say about the

Board’s Cumberland doctrine? 3. Did the Supreme Court hold that the Taft-

Hartley amendments limited an employer’s duty to bargain under Section 8(a)(5) solely to those unions whose representative status was certified after a Board election?

4. Under Gissel, when may the Board issue a bar- gaining order remedy?


changes in employment terms, and offer full reinstatement with back pay to the five fired union supporters. The Section 10(j) injunction preserved the status quo and the union advocates’ jobs until the complaint was processed by the Board.109

Section 10(l) requires the Board to seek temporary injunctive relief against unions in matters such as secondary boycotts, hot cargo agreements, recognitional picketing, and jurisdictional disputes. Section 10(k) frees federal district courts from the restriction of the Norris-LaGuardia Act in the preceding situations. It is important to remember that Section 10(j) and (l) injunctions are temporary and can be utilized only while charges are being processed by the Board.


Under Section 10(a), the Board is given the broad responsibility “to prevent any person from engaging in any unfair labor practice.” The Board has the authority under 10(b) to investigate charges, issue complaints, and order hearings. Under Section 10(c), if the Board determines on the preponderance of the testimony taken at a Board hearing that a person has engaged, or is engaging, in an unfair labor practice, the Board will state its findings of fact and issue an order requiring such a person to “cease and desist from such unfair labor practice, and take such affirmative action, including reinstatement of employees with or without back pay, as will effectuate the policies of this Act.” If a person should choose not to comply with the Board’s order, the Board may petition an appropriate U.S. Court of Appeals for enforcement of its order under Section 10(e). Similarly, any person aggrieved by an order of the Board may file a petition for review of the order with the U.S. Court of Appeals without waiting for the Board to seek enforcement.


In the Phelps Dodge case, the Supreme Court held that the Board has the power under Section 10(c) of the NLRA to order an employer to make whole any employees who have suffered loss of earnings because of the employer’s discrimina- tion in violation of Section 8(a)(3) of the Act.110 The usual order in union activity discrimination cases includes reinstatement of the wronged employees with back pay and a further requirement that the employer post a notice that it will not engage in further discriminatory activity and will take the affirmative action ordered by the Board. When an employer’s unfair labor practice has impaired the ability of the improperly discharged employee to return to work, or the employer or other employees remain hostile to the improperly discharged employee, or the discharged employee is close to retirement, a front pay order may be appropriate, under which the employee is awarded a sum of money for the loss of future earn- ings caused by the unfair labor practice.

109 HTH Corp. d/b/a Pacific Beach Hotel, 356 NLRB No. 182 (June 14, 2011). 110 Phelps Dodge Corp. v. NLRB, 313 U.S. 177 (1941).


A wronged employee does have an obligation to mitigate damages by seeking other suitable employment. In Reserve Supply Corp. and NLRB,111 the U.S. Court of Appeals sustained a Board order requiring an employer to pay 6 percent interest on the back pay amount owed an employee. In Florida Steel Corp. and United Steelworkers of America?112 the Board dropped its 15-year application of a 6 percent back pay interest rate and adopted the adjusted prime rate used by the Internal Revenue Service to set interest on the underpayment or overpayment of federal taxes.

The usual remedy for Section 8(a)(5) refusal-to-bargain violations is a cease- and-desist order from failing to bargain and an affirmative order to bargain collec- tively about wages, hours, and working conditions at the request of the appropriate union. The Board may not order a party to agree to specific contractual items, however. In the H. K. Porter decision, presented in this section, the Supreme Court denied enforcement of an order that would have compelled the employer to agree to a checkoff of union dues.

Usually the remedy for Section 8(b)(1)(A) and (B) cases of union restraint or coercion is a cease-and-desist order and the posting of a notice of compliance by the union.

In the Radio Officers113 case, the Supreme Court held that the Board may issue a back pay order against a union for causing an employer to discriminate against an employee in violation of Section 8(b)(2). When both a union and an employer are charged, the usual remedy is an order holding both liable, reinstate- ment with back pay, and a posting of suitable notices.

Violations of Section 8(b)(4), which prohibits unions from engaging in strikes or boycotts to accomplish certain purposes, are temporarily remedied by Section 10(l) mandatory injunctions, as previously mentioned. Final determinations by the Board may include cease-and-desist orders and posting of appropriate notices.


The Supreme Court held that illegal aliens are employees within the meaning of Section 2(3) of the Act in Sure-Tan, Inc. v. NLRB.114 The Court also held that the employer’s retaliatory notification to the Immigration and Naturalization Service after illegal alien employees voted for a union constituted a constructive discharge. Moreover, the Court determined that the employees were entitled to reinstatement

111 317 F.2d 785 (2d Cir. 1963). 112 231 NLRB 651 (1977). 113 Radio Officers Union, AFL v. NLRB, 347 U.S. 17 (1954). 114 467 U.S. 883 (1984). In Agri Processor Co., Inc. v. NLRB, 2008 U.S. App. LEXIS 7648, in which the UFCW union won a representation election and the employer subsequently ran the Social Security numbers given by all voting employees and discovered that many of the voters were undocumeted workers, the D.C. Circuit enforced a Board bargaining order that the employer had an obligation to bargain with the union. Continuing the tension between the NLRA and IRCA, the Board rejected the employer’s contention that undocumented aliens are not “employees” protected by the NLRA, finding that such a position ignores the Act’s plain language and the Supreme Court’s Sure-Tan, Inc. v. NLRB decision.


when they legally reentered the country (conditional reinstatement) and that back pay must be tolled during the aliens’ illegal presence in the United States.

Subsequent to the Sure-Tan decision, the Immigration Reform and Control Act (IRCA)115 became law in November 1986. Under this Act, civil penalties are imposed on employers who knowingly hire illegal aliens. This law was designed to discourage illegal immigration by the elimination of job opportunities through employer sanctions. In the APRA Fuel Oil Buyers Group, Inc.,116 decision, the NLRB considered the effect the IRCA should have on NLRA remedies and deter- mined that conditional reinstatement and limited back pay were available to undocumented workers who had been subjected to unfair labor practices.

In Hoffman Plastic Compounds, Inc. v. NLRB, presented in this section, the Supreme Court reviewed the Board’s back pay policy for undocumented workers, deciding in a 5-4 decision that the federal immigration policy, as expressed by Con- gress in the Immigration Reform and Control Act of 1986, foreclosed the NLRB from awarding back pay to an undocumented alien who was never legally autho- rized to work in the United States. Hoffman thus abrogated the Board’s APRA Fuel Oil Buyers Group, Inc., decision as to back pay.117

IMMIGRATION ISSUES AND PROCEEDINGS. The immigration status of employees is gener- ally not relevant in NLRB representation cases or proceedings on the merits of unfair labor charges. Regions should presume that employees are lawfully autho- rized to work, and should object to questions on immigration status at the merits stage. Only at the remedial stage, and only after an employer establishes the exis- tence of a genuine issue, should the region investigate immigration status, allowing the individual to respond to the employer’s evidence.118


BLACK, J…. After an election respondent United Steelworkers Union was, on october 5, 1961, certified by the National Labor Relations Board as the bargaining agent for the employees at the Danville, Virginia, plant of the petitioner, H. K. Porter Co. Thereafter

negotiations commenced for a collective bargaining agreement. Since that time the controversy has see- sawed between the Board, the Court of Appeals for the District of Columbia Circuit, and this Court. This delay of over eight years is not because the case is exceedingly complex, but appears to have occurred

115 Pub. L. No. 99-603, also known as the Simpson-Rodino Act. 116 20 NLRB 408 (1995). 117 Undocumented workers injured on the job are entitled to workers’ compensation benefits under the Longshore and Harbor Workers Compensation Act (LHWCA); the plain statutory text of the LHWCA states that “compensation shall be payable.” Back pay under the NLRA is one of several discretionary remedies. See Bollinger Shipyards Inc. v. Rodriguez, 604 F.3d 864 (5th Cir. 2010). See also Asylum Co. v. D.C. Dept. of Employment Services, 10 A.3d 619 (D.C. Cir. 2010), in which the court held that the IRCA did not preclude requiring an employer to pay wage-loss benefits to an injured undocu- mented worker. 118 Office of the Associate General Counsel, Memorandum OM 11-62 (June 7, 2011).



chiefly because of the skill of the company’s negotia- tors in taking advantage of every opportunity for delay in an Act more noticeable for its generality than for its precise prescriptions. The entire lengthy dispute mainly revolves around the union’s desire to have the company agree to “check off” the dues owed to the union by its members, that is, to deduct those dues periodically from the company’s wage payments to the employees. The record shows, as the Board found, that the company’s objection to a checkoff was not due to any general principle or policy against making deductions from employees’ wages. The com- pany does deduct charges for things like insurance, taxes, and contributions to charities, and at some other plants it has a checkoff arrangement for union dues. The evidence shows, and the Court below found, that the company’s objection was not because of inconvenience, but solely on the ground that the company was “not going to aid and comfort the union.” Efforts by the union to obtain some kind of compromise on a checkoff request were all met with the same staccato response to the effect that the col- lection of union dues was the “union’s business” and the company was not going to provide any assistance. Based on this and other evidence the Board found, and the Court of Appeals approved the finding, that the refusal of the company to bargain about the checkoff was not made in good faith, but was done solely to frustrate the making of any collective bar- gaining agreement….

We granted certiorari to consider whether the Board in these circumstances had the power to rem- edy the unfair labor practice by requiring the com- pany to agree to check off the dues of the workers. 396 U.S. 817. For reasons to be stated we hold that while the Board does have power under the National Labor Relations Act, 61 Stat. 136, as amended, to require employers and employees to negotiate, it is without power to compel a company or a union to agree to any substantive contractual provision of a collective bargaining agreement.

Since 1935 the story of labor relations in this country has largely been a history of governmental regulation of the process of collective bargaining. In that year Congress decided that disturbances in the area of labor relations led to undesirable burdens on and obstructions of interstate commerce, and passed the National Labor Relations Act, 49 Stat. 449….

The object of this Act was not to allow govern- mental regulation of the terms and conditions of

employment, but rather to ensure that employers and their employees could work together to establish mutually satisfactory conditions. The basic theme of the Act was that through collective bargaining the passions, arguments, and struggles of prior years would be channeled into constructive, open discus- sions leading, it was hoped, to mutual agreement. But it was recognized from the beginning that agree- ment might in some cases be impossible, and it was never intended that the Government would in such cases step in, become a party to the negotiations and impose its own views of a desirable settlement. This fundamental limitation was made abundantly clear in the legislative reports accompanying the 1935 Act….

In 1947 Congress reviewed the experience under the Act and concluded that certain amendments were in order.

Accordingly Congress amended the provisions defining unfair labor practices and said in Section 8(d) that:

For the purposes of this section, to bargain col- lectively is the performance of the mutual obli- gation of the employer and the representative of the employees to meet at reasonable times and confer in good faith with respect to wages, hours, and other terms and conditions of employment or the negotiation of an agreement, or any question arising thereunder, and the exe- cution of a written contract incorporating any agreement reached if requested by either party, but such obligation does not compel either party to agree to a proposal or require the making of a concession.

In discussing the effect of that amendment, this Court said it is “clear that the Board may not, either directly or indirectly, compel concessions or other- wise sit in judgment upon the substantive terms of collective bargaining agreements.” NLRB v. Ameri- can Ins. Co., 343 U.S. 395, 404 (1952). Later this court affirmed that view stating that “it remains clear that Section 8(d) was an attempt by Congress to prevent the Board from controlling the settling of the terms of collective bargaining agreements.” NLRB v. Insurance Agents, 361 U.S. 477, 487 (1960). The parties to the instant case are agreed that this is the first time in the 35-year history of the Act that the Board has ordered either an employer or a union to agree to a substantive term of a collec- tive bargaining agreement….



… The Board’s remedial powers under Section 10 of the Act are broad, but they are limited to carrying out the policies of the Act itself. One of these funda- mental policies is freedom of contract. While the parties’ freedom of contract is not absolute under the Act, allowing the Board to compel agreement when the parties themselves are unable to agree would violate the fundamental premise on which the Act is based—private bargaining under govern- mental supervision of the procedure alone, without any official compulsion over the actual terms of the contract.

In reaching its decision the Court of Appeals relied extensively on the equally important policy of the Act that workers’ rights to collective bargaining are to be secured. In this case the Court apparently felt that the employer was trying effectively to destroy the union by refusing to agree to what the union may have consid- ered its most important demand. Perhaps the court, fearing that the parties might resort to economic com- bat, was also trying to maintain the industrial peace that the Act is designed to further. But the Act as pres- ently drawn does not contemplate that unions will always be secure and able to achieve agreement even

when their economic position is weak, that strikes and lockouts will never result from a bargaining impasse. It cannot be said that the Act forbids an employer or a union to rely ultimately on its economic strength to try to secure what it cannot obtain through bargaining. It may well be true, as the Court of Appeals felt, that the present remedial powers of the Board are insufficiently broad to cope with important labor problems. But it is the job of Congress, not the Board or the courts, to decide when and if it is necessary to allow governmen- tal review of proposals for collective bargaining agree- ments and compulsory submission to one side’s demands. The present Act does not envision such a process.

Reversed and remanded.

Case Questions

1. Summarize the facts of the case. 2. What is a checkoff? How important is it to a

union? 3. What is the issue before the Supreme Court? 4. What was the Supreme Court’s decision on this



[Petitioner Hoffman Plastic Compounds, Inc., custom-formulates chemical compounds for busi- nesses that manufacture pharmaceutical, construc- tion, and household products. In May 1988, it hired Jose Castro to operate various blending machines that “mix and cook” the particular formulas per cus- tomer order. Before being hired for this position, Cas- tro presented documents that appeared to verify his authorization to work in the United States. In Decem- ber 1988, the United Rubber, Cork, Linoleum, and Plastic Workers of America, AFL-CIO, began a union-organizing campaign at petitioner’s production plant. Castro and several other employees supported the organizing campaign and distributed authoriza- tion cards to coworkers. In January 1989, Hoffman laid off Castro and other employees engaged in these organizing activities. Three years later, in January 1992, the Board found that Hoffman had unlawfully

selected four employees, including Castro, for layoff “in order to rid itself of known union supporters” in violation of Section 8(a)(3) of the NLRA. To remedy this violation, the Board ordered that Hoffman (1) cease and desist from further violations of the NLRA, (2) post a detailed notice to its employees regarding the remedial order, and (3) offer reinstate- ment and back pay to the four affected employees. Hoffman entered into a stipulation with the Board’s General Counsel and agreed to abide by the Board’s order.

In June 1993, the parties proceeded to a compli- ance hearing before an administrative law judge to determine the amount of back pay owed to each discriminatee. On the final day of the hearing, Castro testified that he was born in Mexico and that he had never been legally admitted to, or authorized to work in, the United States. He admitted gaining



employment with Hoffman only after tendering a birth certificate belonging to a friend who was born in Texas. He also admitted that he used this birth certificate to fraudulently obtain a California driver’s license and a Social Security card, and to fraudulently obtain employment following his layoff by Hoffman. Based on this testimony, the ALJ found that the Board was precluded from awarding Castro back pay or reinstatement, as such relief would be contrary to Sure-Tan, Inc., v. NLRB, and in conflict with the IRCA, which makes it unlawful for employers know- ingly to hire undocumented workers or for employees to use fraudulent documents to establish employment eligibility.

In September 1998, four years after the ALJ’s deci- sion, and seven years after Castro was fired, the Board reversed with respect to back pay. Citing its earlier decision in APRA Fuel Oil Buyers Group, Inc., the Board determined that “the most effective way to accommodate and further the immigration policies embodied in [IRCA] is to provide the protec- tions and remedies of the [NLRA] to undocumented workers in the same manner as to other employees.” The Board thus found that Castro was entitled to $66,951 of back pay, plus interest. It calculated this back pay award from the date of Castro’s termination to the date Hoffman first learned of Castro’s undoc- umented status, a period of 3½ years. A dissenting Board member would have affirmed the ALJ and denied Castro all back pay.

Hoffman filed a petition for review of the Board’s order in the court of appeals. A panel of the court of appeals denied the petition for review. 208 F.3d 639 (2001). The Supreme Court granted certiorari.]

REHNQUIST, C. J.… This case exemplifies the principle that the Board’s discretion to select and fashion remedies for viola- tions of the NLRA, though generally broad, … is not unlimited….

The Southern S.S. Co. line of cases established that where the Board’s chosen remedy trenches upon a federal statute or policy outside the Board’s compe- tence to administer, the Board’s remedy may be required to yield. In 1986, two years after Sure-Tan, Congress enacted IRCA, a comprehensive scheme prohibiting the employment of illegal aliens in the United States. § 101(a)(1), 100 Stat. 3360, 8 U.S.C. § 1324a. As we have previously noted, IRCA “forcefully” made combating the employment of

illegal aliens central to “[t]he policy of immigration law.” …

Under the IRCA regime, it is impossible for an undocumented alien to obtain employment in the United States without some party directly contraven- ing explicit congressional policies. Either the undocu- mented alien tenders fraudulent identification, which subverts the cornerstone of IRCA’s enforcement mechanism, or the employer knowingly hires the undocumented alien in direct contradiction of its IRCA obligations. The Board asks that we overlook this fact and allow it to award backpay to an illegal alien for years of work not performed, for wages that could not lawfully have been earned, and for a job obtained in the first instance by a criminal fraud. We find, however, that awarding backpay to illegal aliens runs counter to policies underlying IRCA, poli- cies the Board has no authority to enforce or admin- ister. Therefore, as we have consistently held in like circumstances, the award lies beyond the bounds of the Board’s remedial discretion….

[A]warding backpay in a case like this not only trivializes the immigration laws, it also condones and encourages future violations. The Board admits that had the INS detained Castro, or had Castro obeyed the law and departed to Mexico, Castro would have lost his right to backpay…. Castro thus qualifies for the Board’s award only by remaining inside the United States illegally…. Similarly, Castro cannot mitigate damages, a duty our cases require, … without triggering new IRCA violations, either by tendering false documents to employers or by finding employers willing to ignore IRCA and hire illegal workers. The Board here has failed to even consider this tension. See 326 N.L.R.B., at 1063, n. 10 (finding that Castro adequately mitigated damages through interim work with no mention of ALJ findings that Castro secured interim work with false documents)….

We therefore conclude that allowing the Board to award backpay to illegal aliens would unduly trench upon explicit statutory prohibitions critical to federal immigration policy, as expressed in IRCA. It would encourage the successful evasion of apprehension by immigration authorities, condone prior violations of the immigration laws, and encourage future viola- tions. However broad the Board’s discretion to fash- ion remedies when dealing only with the NLRA, it is not so unbounded as to authorize this sort of an award.




1. Review the Town & Country decision and the text materials in Section 4:7, setting forth the Board’s FES framework for analyzing refusal-to-consider and/or hire cases and the Toering Electric Co. modification of the framework. Employers have been very reluctant to comply with the Supreme

Court’s Town & Country decision, as evi- denced by the many cases involving “salts” considered by the NLRB and the courts. Since the Supreme Court’s 1996 Town & Country decision, five anti-salting bills have been considered and have failed to pass in Con- gress, including the Truth in Employment Act

Lack of authority to award backpay does not mean that the employer gets off scot-free. The Board here has already imposed other significant sanctions against Hoffman—sanctions Hoffman does not challenge…. These include orders that Hoff- man cease and desist its violations of the NLRA, and that it conspicuously post a notice to employees set- ting forth their rights under the NLRA and detailing its prior unfair practices…. Hoffman will be subject to contempt proceedings should it fail to comply with these orders…. As we concluded in Sure-Tan, “in light of the practical workings of the immigration laws,” any “perceived deficienc[y] in the NLRA’s existing remedial arsenal,” must be “addressed by congressional action,” not the courts. Id., at 904, 104 S.Ct. 2803. In light of IRCA, this statement is even truer today….

The judgment of the Court of Appeals is reversed. It is so ordered.

JUSTICE BREYER, with whom JUSTICE STEVENS, JUSTICE SOUTER, and JUSTICE GINSBURG join, dissenting … I cannot agree that the backpay award before us “runs counter to,” or “trenches upon,” national immigration policy. Ante, at 1282, 1283 (citing the Immigration Reform and Control Act of 1986 (IRCA)). As all the relevant agencies (including the Department of Justice) have told us, the National Labor Relations Board’s limited backpay order will not interfere with the implementation of immigration policy. Rather, it reasonably helps to deter unlawful activity that both labor laws and immigration laws seek to prevent. Consequently, the order is lawful….

The Court does not deny that the employer in this case dismissed an employee for trying to organize a union—a crude and obvious violation of the labor laws…. And it cannot deny that the Board has espe-

cially broad discretion in choosing an appropriate remedy for addressing such violations…. Nor can it deny that in such circumstances backpay awards serve critically important remedial purposes…. Those purposes involve more than victim compensa- tion; they also include deterrence, i.e., discouraging employers from violating the Nation’s labor laws….

Without the possibility of the deterrence that backpay provides, the Board can impose only future-oriented obligations upon law-violating employers—for it has no other weapons in its reme- dial arsenal…. And in the absence of the backpay weapon, employers could conclude that they can vio- late the labor laws at least once with impunity. See A.P.R.A. Fuel Oil Buyers Group, Inc., 320 N.L.R.B. 408, 415, N. 38 (1995) (without potential backpay order employer might simply discharge employees who show interest in a union “secure in the knowl- edge” that only penalties were requirements “to cease and desist and post a notice”). Hence the backpay remedy is necessary; it helps make labor law enforce- ment credible; it makes clear that violating the labor laws will not pay….

Case Questions

1. Does federal immigration policy, as expressed in the IRCA, preclude the Board from awarding back pay to an undocumented alien who has never been legally authorized to work in the United States?

2. Does the employer get off scot-free for its viola- tion of the NLRA because back pay is not allowed?

3. Does the dissent believe that the back pay rem- edy best serves as a deterrent against unlawful activity that both the NLRA and the IRCA seek to prevent?


of 2007 (H.R. 2670 and S.1520, 110th Cong. 2007). Does an administrative agency, the NLRB, have the power to change the law regarding the employee status of “salts” under the NLRA when Congress has consid- ered but failed to make changes to the stat- ute? Is the NLRB’s Toering Electric Co. decision an appropriate interpretation of the NLRA under the Chevron framework set forth in Section 2:17?

2. Wurtland Nursing, a rehabilitation center, withdrew recognition of the S.E.I.U. Local 1199 after it received an “RD” petition signed by a majority of employees in the unit that stated the following:

We the Employee’s [sic] of Wurtland nursing and rehab wish for a vote to remove the union S.E.I.U. 1199.

Under the Levitz Furniture standard, “an employer may unilaterally withdraw recognition from an incumbent union only where the union has actually lost the support of the majority of the bargaining unit employees … and the employer bears the burden of showing, through objective evi- dence, an actual loss of the union’s majority status at the time of the withdrawal of recognition.” Did the employer violate Sec- tion 8(a)(5) in this case, or was this petition proof that the union had actually lost the support of a majority of employees, allowing the employer to unilaterally withdraw recognition from the union? [Wurtland Nursing & Rehabilitation Center, 351 NLRB No. 50 (Sept. 29, 2007).]

3. In July 1999, the Seattle Mariners baseball team moved from the King County- owned-and-operated Kingdome to newly constructed Safeco Field and hired 450 employees, some of whom were previously employed by King County at the Kingdome. The employer and union entered into a written neutrality/card check agreement prior to the move, pursuant to which the employer agreed to remain neutral during the organizing campaign and the parties designated an arbitrator to perform the card

check. In September, the union submitted authorization cards to the arbitrator, and by letter dated September 24, the arbitrator certified that the union possessed majority status. On September 22, a group of “no- union” employees sent a petition to the arbitrator, signed by more than 30 percent of the employees, indicating that they did not want union representation. By letter dated September 28, the arbitrator notified the group that he had already completed his duties under the neutrality/card check agreement. Following this card check certi- fication by the arbitrator, the employer and union began negotiations for a first collective bargaining agreement. Based on the facts, the regional director concluded that the employer’s voluntary recognition of the union based on the union’s majority status did not create a “recognition bar” to the decertification petition filed by the no-union group. What did the regional director mean by determining that the voluntary recogni- tion by the employer did not create a “rec- ognition bar”? How would you decide this case under the Board’s Dana Corp. decision? [Baseball Club of Seattle, Limited Partner- ship, 335 NLRB 563]

4. In February 2009, AT&T telephone techni- cians represented by the Communication Workers of America union (CWA) and the company began negotiations for a collective bargaining agreement to replace a contract that was scheduled to expire in April 2009. Lengthy negotiations failed to produce an agreement, and the union became dissatisfied and planned a number of “mobilization” activities.

In August 2009, a CWA mobilization committee designed a “prisoner shirt” to be worn by employees. The front of the white shirt had the legend “INMATE #” above a black box. On the back of the shirt were vertical stripes and bars surrounding the message “PRISONER OF AT$T.” The union distributed the shirt to AT&T work- ers, including customer-facing employees.


CWA committee members eliminated some stripes from their design so as to ensure that the shirt did not look too much like real prison garb. Although the committee did not discuss whether customers might think they were encountering real prisoners rather than AT&T workers, a union business agent tes- tified that the employees would be wearing AT&T identification tags and driving clearly labeled company trucks, and contended, “You’d have to be an idiot to think that there was a prisoner at your front door.”

AT&T managers directed customer- facing employees not to wear the “inmate” shirts. After the company issued one-day suspensions to some workers who wore the shirt, CWA filed an unfair labor practice charge. Did AT&T employees have the right to wear the inmate shirts and union insignia while at work? Did it make a difference if customer-facing employees wore the shirts? Decide. [Southern New England Telephone Co. d/b/a AT&T Connecticut, 356 NLRB No. 118 (March 24, 2011)]

5. The Health Care Institution (HCI) main- tained a no-solicitation rule, which, on its face, prohibits solicitation for any purpose during working time and in immediate patient care areas. Before and after the union’s organizing campaign began, HCI was inconsistent with its enforcement of this policy. For example, the employer warned and/or disciplined employees engaged in union solicitation activity. But it allowed institutional commercial solicitations (sales of Avon, Mary Kay cosmetics, Tupperware, and Pampered Chef products), individual commercial solicitations (sales of homemade foods, jewelry, and holiday crafts), school fund-raising solicitations (sales of candy, candles, and wrapping paper items), and personal solicitations (collection of money for various families). HCI believes that under the Register Guard rule, because it did not permit communications of a character simi- lar to union organizing, it lawfully enforced its rule against employees engaged in union

solicitation activity. The union disagreed. Decide. [Office of General Counsel, Register Guard cases, Case No. 2 DLR No. 97, E-6 (May 20, 2008)]

6. One Monday, a labor organization affiliated with the International Ladies Garment Workers Union began an organization drive among the employees of Whittal & Shon, Inc. On the following Monday, six of the employees who were participating in the union drive were discharged. Immediately after the firings, the head of the company gave a speech to the remaining workers in which he made a variety of antiunion state- ments and threats. The union filed a com- plaint with the NLRB, alleging that the six employees were fired because they were engaging in organizational activity and that they were thus discharged in violation of the NLRA.

Assuming that the NLRA was violated, it could take two to three years before the NLRB obtains a final binding order com- pelling the employer to reinstate the six employees. Under the NLRA, must the employees wait this long to get their jobs back? What action may be taken by the Board in this case? [Silverman v. Whittal & Shon, Inc., 125 LRRM 2150 (S.D.N.Y.)]

7. The facts before the Board when it made its decision are: The Firestone Tire and Rubber Company employs 15,000 production and maintenance employees in 11 plants across the nation. All production and maintenance employees have been represented by the United Rubber Workers of America since 1948. Two thousand of the employees represented by the URW are skilled trades- people. These skilled workers are members of nearly 50 different crafts and include machinists, carpenters, crane operators, and refrigeration mechanics. The rubber manufacturing production process is highly integrated, and these skilled workers spend up to 90 percent of their working time in production areas repairing production machinery.


A union called the International Society of Skilled Trades seeks to sever all skilled trades from the URW and to represent the various skilled workers in one unit. This would be the first such dual representation of production and maintenance workers in the rubber industry.

What factors must the Board consider before it allows craft severance? Based on the facts of this case, should the skilled trades be severed into their own unit? Explain. [Fire- stone Tire and Rubber Co., 223 NLRB 955, 91 LRRM 156]

8. The Saint Joseph News-Press publishes a morning newspaper in Saint Joseph, Mis- souri. Haulers pick up the bundled papers at the plant and bring them to common drop points, where carriers pick them up. Carriers deliver papers to the customers. They also place papers in newspaper racks, deliver to dealers, and drop newspapers at the post office to be mailed to subscribers. When hired, carriers do not complete applications. They sign a contract with the newspaper expressly describing them as independent contractors. The contract grants the carrier the nonexclusive right to purchase, sell, and deliver the newspaper in a designated area and to control the method and means of making deliveries. Carriers sign the contracts as individuals; none are incorporated. Thirty days’ notice is required for either party to terminate the contract without cause. The newspaper can terminate the contract for cause without notice. The contract prohibits carriers from displaying the newspaper’s insignia while delivering newspapers and requires carriers to provide their own vehi- cles and auto insurance. The General Coun- sel asserts that the carriers did not operate as independent businesses and performed func- tions integral to the newspaper’s business and had little opportunity for entrepreneur- ial gain or loss and little or no bargaining power. The newspaper contends that the carriers are independent contractors excluded from the protection of the act.

Decide. [St. Joseph News-Press and Team- sters Union Local 460, 345 NLRB No. 31.]

9. Hasbro Industries maintains a printing divi- sion at its main plant in Pawtucket, Rhode Island. The Graphic Arts International Union notified Hasbro and the Board that it had obtained authorization cards from 11 of the 18 employees in the printing division. An election date was accordingly set. Prior to the election, Hasbro sent a letter signed by the management to the employees. The letter stated that employees and their families faced “real risks” if they made “the wrong decision.” The letter concluded that the employees faced the loss of benefits and “the tragedy of permanent replacement” in the event a strike occurred. Another letter listed 28 benefits the employees risked losing if the union won the election. Mr. Feldman, a Hasbro manager, told one printing depart- ment employee that Hasbro would “never let another union in here.” He also stated that Hasbro would subcontract out the printing division’s work rather than deal with a union. The union subsequently lost the elec- tion. After the election, Feldman told an employee that the printing division would have been closed if the union had won. In addition, Hasbro granted higher-than- normal pay raises to the printing division immediately after the election. At this time, Hasbro knew that the union had filed objections to the election and had asked the NLRB to set aside the election and order Hasbro to bargain on the basis of the union’s authorization-card majority.

Is the company’s conduct within the company’s rights under the NLRA? Explain. Should the NLRB issue the bar- gaining order requested by the union? Explain. [NLRB v. Hasbro Industries, 109 LRRM 2911 (1st Cir.)]

10. The Communication Workers Union sought to represent certain service employees of Electro Protective Corporation as part of a communications craft bargaining unit. The company sells, installs, monitors, and


services alarm systems. The employees in question respond to alarms at customers’ premises, protecting the premises until the police or customers arrive. The employees also reset the alarm systems and provide any maintenance that the systems require. These employees drive radio-dispatched vans, wear uniforms, and are provided with nightsticks. They face the possibility of personal con- frontation with intruders. The union insisted that these workers were maintenance per- sonnel who could be represented by their unit. The company contended that these employees were guards under Section 9(b)(3) and therefore must be excluded from the unit in question.

Are these employees guards under the Act? What difference would the absence of uniforms and nightsticks make? [Electro Protective Corp., 251 NLRB 154, 105 LRRM 1254]

11. The unionized employees of Duo-Fast Cor- poration were scheduled to vote in a decer- tification election on June 15 to determine whether Teamsters Local 210 would con- tinue to be their bargaining representative. At a June 7 meeting with the represented employees, a Duo-Fast manager distributed a leaflet signed by him that compared the health benefits of the unionized employees with the benefits provided to Duo-Fast’s nonunion employees. The benefits received by the nonunion employees were generally better. The leaflet stated, “I’m not promising you better medical benefits if you vote ‘No’ on June 15, but you should know our non- union employees’ medical benefits.” The leaflet concluded: “[G]ive me and Duo-Fast a chance to show you that you don’t need Local 210. Vote ‘No’ on June 15.” When he distributed the leaflet, the manager stated that if the union was voted out, the employees would receive “basically this type of coverage.” The manager answered employees’ questions at other meetings held on June 9, 13, and 14. When he was asked when the medical coverage would go into

effect, the manager responded “immedi- ately” or “most likely right away.” At some of the meetings, however, the manager stated that he was not promising anything.

On June 15, Local 210 lost the decerti- fication election. The union filed a complaint with the NLRB charging the employer with interfering with the election by promising the employees better health benefits if they voted the union out. Local 210 asked for a new election.

Should another election be held? Decide. [Duo-Fast Corp., 122 LRRM 1136 (NLRB)]

12. Michael’s Painting Co., Inc., of Van Nuys, California, became aware of an organizing campaign by the Painters Union in late March 1998. On March 27, the company employed 12 painters, with some 22 other painters being on layoff status. The union had obtained 18 signed authorization cards from a majority of the employees in the 34-person unit by March 27. On that after- noon, employees picketed at the offices of Michael’s with signs protesting the alleged failure to pay prevailing wages. The signs stated “We need a Union,” “Michael’s Painting is unfair,” “It is alright to be Union.” Union business agent Alexander Lopez spoke to owner Laurie Abikasis. Lopez told her that he had signed union authorization cards. Later in the day Mrs. Abikasis told employees that the company did not want the union and did not need the union. She also said that she and her co- owner husband, Michael, would close the company rather than become a union shop. She also said she could not afford to be union—that she would go broke if she became a union shop and that the union agents were parasites. On Monday, March 30, Lopez asked Michael Abikasis to recog- nize the union based on the authorization cards. He stated that he would look into the matter and discuss it with Lopez at a later date. Thereafter, employees Lainez, Duenas, Romero, Martin Vega, and Carlos Vega were turned away from work by


Mr. Abikasis and never again allowed to return to work. That afternoon Mrs. Abi- kasis told each of the employees that their paychecks could not be released unless the employees first provided a green card, Social Security number, or driver’s license; the cul- ture in the company had been lax in this regard previously. The employees were paid later that day. The two owners transferred all of the assets and work of that company to a newly formed company “Painting LA, Inc.” During a job interview on April 20, 1998, one of the fired workers was interro- gated by the employer about his and other employees’ union activities.

Identify the unfair labor practices evident in the preceding fact pattern. Is “Painting LA, Inc.” an “alter ego” of Michael’s Painting, Inc.? If so, should the NLRB impose a Gissel bargaining order or should it conduct an election to determine employee choice on the question of representation? [Michael’s Paint- ing, Inc., 337 NLRB No. 140]

13. Union organizers Dooley and King applied for driver positions at Casino Ready Mix, Inc., a nonunion operation in Las Vegas, Nevada, in response to Casino’s advertise- ment for drivers. Both wore shirts identifying themselves as organizers for the union as well as baseball caps with union logos when they applied in person on April 8. Each stated his organizer status on his application. The company received their applications and told them it was not hiring. In fact, the company hired four other drivers between April 8 and 21. Evidence existed that the

company president had stated that he would never allow a union to represent his employees. Both Dooley and King were qualified drivers. The employer believed that “disabling conflicts” existed in this case and, if hired, the two union organizers would engage in activities inimical to the employ- er’s operations. Dooley and King believe that they were not hired in violation of Section 8 (a)(3) of the act. Decide. [Casino Ready Mix, Inc., v. NLRB, 321 F.3d 1190 (D.C. Cir.)]

14. “A”, a customer service employee at a Wal-Mart store in Oklahoma posted on his Facebook page while off duty “Wuck- Falmart! I swear if this tyranny doesn’t end in this store they are about to get a wakeup call because lots are about to quit!” Two cowor- kers responded to A’s postings with brief comments, and he replied with comments complaining that he was “chewed out” for putting merchandise in the wrong place. And, he wrote that he was going to talk to the store manager “about this shit cuz if it don’t change Wal-Mart can ….” When Wal-Mart learned of the Facebook posting the store suspended him for a day, making him ineli- gible for promotion for 12 months. “A” believes that his comments were protected concerted activities under Section 7 of the NLRA, and the discipline was a violation of Section 8(a)(1). The employer disagreed. Was this an unprotected individual “gripe” of an employee; or was it NLRA-protected con- certed activity? [Wal-Mart, NLRB Div. of Advice, No. 17-CA-25030 (July 19, 2011)].


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5:1 Protection of Employee Rights

5:2 Freedom from Interference

5:3 Domination of Labor Organizations

5:4 Discrimination as to Hire and Tenure

5:5 Discriminatory Lockouts

5:6 Permanent Shutdowns

5:7 Discrimination for Concerted Activities

5:8 Union Security and “Right-to-Work” Laws

5:9 Discrimination for NLRB Action

5:10 Duty of Employer to Bargain

5:11 Successor Employers’ Obligations under the NLRA

5:12 Rejection of Labor Contracts under Chapter 11 of the Bankruptcy Code


Employees have rights to form, join, or assist labor organizations, and they also have the right to refrain from such activities.



Section 1 of the NLRA set forth the policy of the 1935 Act in part as follows:

to encourag[e] the practice and procedures of collective bargaining … and protect the exercise by workers of full freedom of association, self organization and designation of representatives of their own choosing, for the purposes of negotiating the terms and conditions of their employment or other mutual aid or protection.

The design of Section 7 of the 1935 Act was to implement the policy stated in Section 1 of the NLRA. With the heading “Rights of Employees,” it stated as follows:

Section 7. Employees shall have the right to self-organization, to form, join or assist labor organizations, to bargain collectively through representatives of their own choos- ing, and to engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection.

Section 7 of the 1935 statute thus provided that employees shall have “the right to self organization and the right to form, join or assist labor organizations” and the right “to engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection.” Section 8 of the Act made it an unfair labor practice for an employer “to interfere with, restrain, or coerce employ- ees” in the exercise of their rights “guaranteed in Section 7.”


Employees’ rights were expanded by the Taft-Hartley Amendments to the NLRA in 1947, which added to the language of Section 7 the guarantee that employees also had the right “to refrain from any and all such activities.” The policy behind this amendment was stated in Section 1(b) of the 1947 statute, reading “to protect the rights of individual employees in their relations with labor organizations….” The 1947 amendments contained union unfair labor practices, in Sections 8(b)(1) and 8(b)(2), to protect employees in their relations with labor organizations.


Section 7 provides protection for employees engaged in concerted activities in forming unions and their involvement in the collective bargaining process, as well as for those refraining from such activities. It also protects employees engaged in “other concerted activities” concerning “other mutual aid or protection.” To be protected as a “con- certed activity” under the Act, it is not necessary that an employee have an official union title or designation that he or she is authorized to represent fellow employee interests. The test is whether the individual acted with the purpose of furtherance of the goals of a group of employees. For example, an employee’s complaint about his employer’s favoritism among crew members did not lose the protection of the Act, as the employee was expressing concern that other employees had raised and it was raised at a meeting, an appropriate place to raise such a concern.1

1 Media General Operations, Inc., 341 NLRB No. 18 (2004).


The Meyers Industries rule established that activities of a single employee are “concerted” under the Act when undertaken with or on the authority of other employees and not solely by or on behalf of the individual.2 Thus, the Board found that a longshoreman’s threat to stop working if drinking water did not arrive by a certain time constituted protected concerted activity, as it was a logical outgrowth of his and other employees’ concerns about having drinking water available at the worksite.3 In Hollings Press, Inc., however, a female employee was terminated for purportedly attempting to coerce coworkers to testify on her behalf at a hearing on a sexual harassment complaint against her supervisor. The Board found that although the employee’s request for help from others was “concerted activity,” it was not for “mutual aid or protection” under Section 7, but rather was aimed only at aiding or protecting her own interests.4


Under the broad and all-inclusive wording of Section 8(a)(1), employers may not interfere with, restrain, or coerce employees in any of their Section 7 rights. What- ever unfair labor practice an employer commits, it automatically means a violation of this subsection also. Moreover, aside from such indirect derivative applications of this catch-all clause, independent violations of Section 8(a)(1) occur where an employer commits such acts as those described in the following subsections.5


Implying the loss of jobs, promising or granting benefits, or suggesting the loss of benefits related to voting for or joining a union or for unionizing an operation has been held to be illegal. In its Aluminum Casting and Engineering Co. decision,6 the Board found a Section 8(a)(1) violation where the employer withheld its annual pay increase during a union-organizing campaign because the employer sought to influence its employees’ decision. In a June 27 leaflet distributed to all employees, the employer unambiguously attributed to the union the responsibility for the absence of the wage increase, stating that the union “stuck its nose in.” Neither granting nor withholding a wage increase during an organizational campaign is

2 268 NLRB 493 (1984), rev’d sub nom. Prill v. NLRB, 755 F.2d 941 (D.C. Cir), cert. denied sub nom. Meyers Industries. v. Prill, 474 U.S. 971 (1985), decision on remand, 281 NLRB 882 (1986), aff’d sub nom. Prill v. NLRB, 835 F.2d 1481 (D.C. Cir. 1987), cert. denied sub nom. Meyers Indus- tries. v. NLRB, 487 U.S. 1205 (1988). 3 Golden Stevedoring Co., 335 NLRB 410 (2001). 4 343 NLRB No. 45 (2004). 5 A single case involving charges filed against an employer under Section 8(a) of the Act may include allegations of more than one subsection of the Act. The Board considers a violation of Sections 8(a)(2) through 8(a)(5) also to be a derivative violation of Section 8(a)(1). Some 16,541 cases were filed against employers in the fiscal year ended September 30, 2009, as reported in the Board’s Annual Report, with 2,461 charges involving an independent Section 8(a)(1) charge, 451 involving Section 8(a) (2), 6,411 involving Section 8(a)(3), 654 involving Section 8(a)(4), and 8,723 involving Section 8(a)(5). Seventy-Fourth Annual Report of the NLRB, issued February 2010. 6 328 NLRB No. 2 (April 9, 1999).


illegal per se. It is the benefit manipulation that is the basis of the Section (8)(a)(1) violation. A promise “to take care” of those voting against the union, a promise to “get a raise next week” for an employee taking the employer’s side, or a warning that a company would close and move to another location or go out of business entirely before it would deal with a union may be the basis of a finding of interference.

In its Hughes Drywall7 decision, the Board found that the employer’s threat to call police on a union conducting “area standards” picketing and the false accusation that a picketer had urinated on a company truck and its insistence that the picketer be arrested was a Section 8(a)(1) violation. The Board decided that the employer’s conduct in attempting to interfere with area-standards picket- ing by threatening and causing an arrest, was an attempt to interfere with the union’s protected activity under Section 7. The Board ordered the contractor to reimburse the union for litigation costs and to arrange for the expungement of all records of the illegal arrest. In ELC Electric, Inc.,8 the employer’s vice presi- dent of operations responded to a question on health insurance during a manda- tory meeting of employees in which employees were urged not to vote for representation by a union. The vice president stated that “he was looking into insurance for the employees.” The Board found that this statement interfered with the election and violated Section 8(a)(1) by impliedly promising to improve health insurance benefits.


An employer’s interrogation of employees as to union allegiance or activity may be coercive in itself and unlawful. The Board looks to factors such as the identity of the questioner, the place, the method of interrogation, and the nature of the informa- tion sought. In the Board’s Schied Electric case,9 the Board found a Section 8(a)(1) violation when the company’s president, Martin Walgenbach, summoned union steward Tim Robertson to his office and asked if Robertson would remain employed if the company went nonunion. Robertson answered that he could not afford to lose his pension and health insurance benefits, and could not remain with the company. Walgenbach replied that he would hate to lose Robertson. This questioning, which was carried out by the highest ranking company officer, and took place in his office in a context of the company planning to withdraw recognition of the union, was coercive because it tended to force the employee to abandon sympathy for and alle- giance to the union.

Questioning job applicants or employees about union sentiment, inquiring as to fellow workers’ interests in a union, or using systematic interrogation regardless of threats or promises have all been held unlawful in themselves. Creative indirect methods of inquiring about employee sentiments may also prove unlawful, such as

7 Roger Hughes Drywall, 334 NLRB No. 49 (2005). 8 344 NLRB No. 144 (2005). 9 Schied Electric and IBEW, Local 343, 355 NLRB No. 27 (Apr. 10, 2010). See also Southside Medical Center, Inc., 356 NLRB No. 58 (Dec. 23, 2010).


an employer’s distribution of “Vote No” coffee mugs that compelled employees to either take the mug or reveal their pro-union beliefs.10 An employer may lawfully poll employees concerning representation attitudes. However, such policy will be an unfair labor practice, under the rule of the Struknes Construction Co.,11 case unless the following safeguards are observed:

1. The purpose of the poll must be to determine the truth of a union’s claim of majority.

2. This purpose must be communicated to the employees. 3. Assurances against reprisal must be given. 4. The employees must be polled by secret ballot. 5. The employer must not have engaged in unfair labor practices or otherwise

created a coercive atmosphere.


An employer may have a rule against union activity on company working time if the rule is fairly applied and not used for discriminating purposes between unions. Such a rule during non-working time is illegal unless it can be shown that the rule is necessary to maintain order and discipline or to ensure safe work conditions and production. In its Meijer, Inc.,12 decision, the Board found that a supermarket chain’s no-solicitation policy was too broad in because it prohibited employees from distributing union literature in its retail stores’ parking areas during nonwork- ing time, and the employer failed to demonstrate a business justification for the policy.

Once an employer permits use of the bulletin board for union purposes, the employer generally may not remove notices or discriminate against employees who post notices that the employer finds distasteful, absent a showing by the employer of “special circumstances.” To be “special,” the circumstances must justify the restriction of the employees’ Section 7 rights. Examples include the need to main- tain discipline of employees and to avert violence.13

Employees have the right to wear union insignia, such as union stickers or but- tons, while at work and to place these insignia on company-owned hard hats, absent special circumstances inherent in the business.14 Employees have no right, however, to place stickers on an employer’s walls or machines.15

The peculiar needs of retail operations are recognized by the Board, which allows store rules prohibiting union discussion or solicitation on the selling floors at any time. Such a rule may not legally apply to the entire store premises at all

10 Circuit City Stores, Inc., 324 NLRB 147 (1997). 11 165 NLRB 1062 (1967). 12 344 NLRB No. 115 (2005). 13 Southwestern Bell Tel. Co., 276 NLRB No. 110, 120 LRRM 1145 (1985); Republic Aviation Corp. v. NLRB, 324 U.S. 793 (1945). 14 Malta Construction Co., 276 NLRB 1494, 120 LRRM 1209 (1985). 15 NLRB v. Payless Cashway Lumber, Inc., 505 F.2d 24, 26 (8th Cir. 1974).


times, nor may management have a rule restricting employees if, at the same time, it engages in antiunion communications with employees.

The right to talk with fellow workers during nonworking time regarding grie- vances may not be restricted by management. The Board has found that such rules would obstruct the self-organization and representation rights of employees. Also, the Board has found that an employer violated Section 8(a)(1) by maintaining a discipline rule prohibiting “negative conversations” about associates or managers. The Board determined that such a rule would bar employees from discussing coworker complaints about managers, causing them to refrain from engaging in protected activities.16


An employer violates Section 8(a)(1) if management or its agent attempts surveil- lance over employee union activities, spies on union conversation or conduct, or even creates the impression of watching such activity. In the Montgomery Ward17

decision, using detectives for this purpose was found unlawful. In the Board’s Tenent Health System Hospitals, Inc.,18 decision, it applied the

rule that absent proper justification, the photographing of employees engaged in concerted activities violates Section 8(a)(1) of the Act because it has the tendency to intimidate. Approximately 120 informational picketers traversed about 300 feet of the public sidewalk fronting the Garfield Medical Center. Picketers carried signs with such legends as “Garfield Unfair to Nurses,” “Honk if You Support Nurses,” “Say NO to Corporate Greed,” and “We Deserve a Contract.” Picketers chanted, “We want a contract now.” Under the hospital’s direction, employee Ariel Shen photographed the picketing activity. In all, she took more than 50 photographs for the stated purpose of memorializing the written content of the picket signs, showing whether picketers blocked the driveway, and showing whether they entered the hospital’s property. On the facts before the Board, no basis existed for the hospital to reasonably have anticipated misconduct by the informational pick- eters. A mere suspicion that something might happen to justify the recordation is insufficient when balanced against the tendency of interference with protected rights.

In the Board’s Saia Motor Freight Line, Inc.,19 decision, where some 30 to 40 handbillers did in fact interfere with the flow of traffic into and out of a struck company’s terminal and the company did not photograph the handbillers until the police were unable to minimize traffic congestion, the Board found that the com- pany had a legitimate safety concern because of the potential for accidents. Accord- ingly, the Board concluded that the employer did not engage in surveillance or create the impression of surveillance in violation of Section 8(a)(1) of the Act.

16 KSL Claremont Resort, Inc., 344 NLRB No. 105 (2005). 17 269 NLRB 904 (1984). 18 2002 WL 31402769. 19 333 NLRB No. 87 (2001).



The Board has authority to find a violation of Section 8(a)(1) of the Act and order appropriate relief when an employer files an objectively baseless lawsuit against a union or employees in retaliation for a lawful strike, picketing, or other concerted activity protected under Section 7 of the NLRA. If an employer’s lawsuit, although ultimately nonmeritorious, is reasonably based, the Board may not find a Section 8(a)(1) violation involving a retaliatory motive even if the employer involved acted with antiunion animus or ill will toward the employees and union involved. In BE&K Construction Co. v. NLRB,20 the Supreme Court explained that a nonmeritorious lawsuit may be reasonably based even though it is ultimately unsuccessful. Even though the suit may attack activity that is ultimately determined to be protected, the suit nevertheless enjoys First Amendment protection if the plaintiff employer reasonably believes the conduct is unprotected and illegal. Similarly, the Court reasoned that inferring a retaliatory motive from evidence of animus would condemn genuine petitioning in circumstances where the plaintiff’s “purpose is to stop conduct he reasonably believes is illegal.” For the Court, then, a retaliatory-motive standard incorrectly “broadly covers a substantial amount of genuine petitioning.”21


In 1973, the National Labor Relations Board issued its Weingarten decision, which held that an employer violated Section 8(a)(1) of the National Labor Relations Act when it denied an employee’s request for the presence of a union representative at an investigatory interview that the employee reasonably believed might result in disciplinary action.22 The Board’s decision was upheld by the Supreme Court in NLRB v. Weingarten, Inc., in 1975,23 presented in this section. The Weingarten right of an employee to request the presence of a coworker at an investigatory interview was extended to nonunion workplaces by the Board’s 1982 Material

20 122 S. Ct. 2390 (2002). 21 See BE&K Construction Co., 351 NLRB No. 29 (2007), in which on remand from the Supreme Court, a 3–2 Board majority found that all “reasonably based” lawsuits, both ongoing and completed, and ultimately unsuccessful, are immune from liability under the NLRA in order to protect the First Amendment right to petition, without regard for the existence of a retaliatory motive on the part of the employer for filing the lawsuit. The dissent would have remanded the case to evaluate whether the unsuccessful suit was brought with a retaliative motive such as to impose litigation costs on the union, balancing the protection of Section 7 rights of employees with the employer’s constitutional right of accesss to the courts.

The General Counsel’s guidance, Memorandum GC-08-02 (Dec. 27, 2007), directs that the region first investigate whether the suit is “reasonably based”; if so, the region should dismiss the charge. If the region determines that the suit is baseless, it should fully investigate the evidence that the suit was brought with a retaliatory motive and process the matter against the employer through the Division of Advice. 22 202 NLRB 446 (1973). 23 4 20 U.S. 251, 260 (1978).


Research Corp. decision.24 Three years later, in 1985, the Board reversed itself in Sears, Roebuck Co., holding that Weingarten principles do not apply in nonunion settings.25 In the Board’s 2000 Epilepsy Foundation of Northeast Ohio decision, it reimposed its Materials Research holding, concluding that unrepresented employees have a right to have a coworker present during investigatory interviews.26 The Court of Appeals for the District of Columbia Circuit upheld the Board’s renewed meaning of the statutory language in question, stating in part:

It is a fact of life in NLRB lore that [the meaning of] certain substantive provisions of the NLRA invariably fluctuate with the changing compositions of the Board. Because the Board’s new interpretation is reasonable under the Act, it is entitled to deference.27

Three years later, with the changing composition of the Board, on June 9, 2004, in a 3–2 decision, the Board reversed itself again in its IBM Corp. decision, presented in this section, and ruled that nonunion employees do not have the right to have a coworker present during an investigatory interview. With the changed composition of that Board, the matter is again subject to change.


[During an investigatory interview at which an employee of Weingarten was being interrogated about reported thefts at a Weingarten store, the employee requested, but was denied, the presence at the interview of her union representative. The union filed an unfair labor practice charge with the NLRB, which held that the employer had committed an unfair labor practice. The NLRB issued a cease- and-desist order; however, the court of appeals reversed, holding that an employee has no need for union assistance at such an interview. The decision was appealed to the Supreme Court.]

BRENNAN, J.… The Board’s construction that Section 7 creates a stat- utory right in an employee to refuse to submit with- out union representation to an interview which he reasonably fears may result in his discipline was

announced in its decision and order of January 28, 1972, in Quality Mfg. Co., 195 N.L.R.B. 197…. In its opinions in that case and in Mobil Oil Corp., 196 N.L.R.B. 1052, decided May 12, 1972, three months later, the Board shaped the contours and limits of the statutory right.

First, the right inheres in Section 7’s guarantee of the right of employees to act in concert for mutual aid and protection. In Mobil Oil, the Board stated:

An employee’s right to union representation upon request is based on Section 7 of the Act which guarantees the right of employees to act in concert for “mutual aid and protection.” The denial of this right has a reasonable tendency to interfere with, restrain, and coerce employees in violation of Section 8(a)(1) of the Act. Thus, it is a serious violation of the employee’s individual right to engage in concerted activity by seeking


24 262 NLRB 1010 (1982). 25 274 NLRB 230 (1985). See also Slaughter v. NLRB, 794 F.2d 128 (3d Cir. 1986). 26 331 NLRB 676 (2000). 27 268 F.3d 1095 (D.C. Cir. 2001).


the assistance of his statutory representative if the employer denies the employee’s request and compels the employee to appear unassisted at an interview which may put his job security in jeopardy. Such a dilution of the employee’s right to act collectively to protect his job interests is, in our view, unwarranted interference with his right to insist on concerted protection, rather than individual self-protection, against possible adverse employer action.

Second, the right arises only in situations where the employee requests representation. In other words, the employee may forgo his guaranteed right and, if he prefers, participate in an interview unac- companied by his union representative.

Third, the employee’s right to request representa- tion as a condition of participation in an interview is limited to situations where the employee reasonably believes the investigation will result in disciplinary action. Thus the Board stated in Quality:

We would not apply the rule to such run- of-the-mill shop-floor conversations as, for example, the giving of instructions or training or needed corrections of work techniques. In such cases there cannot normally be any reasonable basis for an employee to fear that any adverse impact may result from the interview, and thus we would then see no reasonable basis for him to seek the assistance of his representative.

Fourth, exercise of the right may not interfere with legitimate employer prerogatives. The employer has no obligation to justify his refusal to allow union representation, and despite refusal, the employer is free to carry on his inquiry without interviewing the employee, and thus leave to the employee the choice between having an interview unaccompanied by his representative, or having no interview and forgoing any benefits that might be derived from one….

Fifth, the employer has no duty to bargain with any union representativewhomaybepermitted to attend the investigatory interview. The Board said in Mobil, “We are not giving the Union any particular rights with respect to pre-disciplinarydiscussionswhich it otherwise was not able to secure during collective bargaining negotiations.”…TheBoard thus adhered to its decisions distinguishing between disciplinary and investigatory interviews, imposing a mandatory affirmative obliga-

tion to meet with the union representative only in the case of the disciplinary interview.Texaco, Inc.,Houston Producing Division, 168 NLRB 361 (1967)….

The Board’s holding is a permissible construction of “concerted activities for … mutual aid or protection” by the agency charged by Congress with enforcement of the Act, and should have been sustained.

The action of an employee in seeking to have the assistance of his union representative at a confronta- tion with his employer clearly falls within the literal wording of Section 7 that “[e]mployees shall have the right to engage in … concerted activities for the pur- pose of … mutual aid or protection.” Mobil Oil Corp. v. NLRB, 482 F.2d 842, 847 (7th Cir. 1973). This is true even though the employee alone may have an immediate stake in the outcome; he seeks “aid or protection” against a perceived threat to his employment security. The union representative whose participation he seeks is, however, safeguarding not only the particular employee’s interest, but also the interests of the entire bargaining unit by exercising vigilance to make certain that the employer does not initiate or continue a practice of imposing punish- ment unjustly. The representative’s presence is an assurance to other employees in the bargaining unit that they, too, can obtain his aid and protection if called upon to attend a like interview….

The Board’s construction plainly effectuates the most fundamental purposes of the Act. In Section 1, 29 U.S.C. Section 151, the Act declares that it is a goal of national labor policy to protect “the exercise by workers of full freedom of association, self- organization, and designation of representatives of their own choosing, for the purpose of … mutual aid or protection.” To that end the Act is designed to eliminate the “inequality of bargaining power between employees … and employers.” Requiring a lone employee to attend an investigatory interview which he reasonably believes may result in the impo- sition of discipline perpetuates the inequality the Act was designed to eliminate, and bars recourse to the safeguards the Act provided to redress the perceived imbalance of economic power between labor and management. American Ship Building Co. v. NLRB, 380 U.S. 300, 316…. Viewed in this light, the Board’s recognition that Section 7 guarantees an employee’s right to the presence of a union representative at an investigatory interview in which the risk of discipline reasonably inheres is within the protective ambit of



the section “read in the light of the mischief to be corrected and the end to be attained.” NLRB v. Hearst Publications, Inc., 322 U.S. 111, 124 (1944).

The Board’s construction also gives recognition to the right when it is most useful to both employee and employer. A single employee confronted by an employer investigating whether certain conduct deserves discipline may be too fearful or inarticulate to relate accurately the incident being investigated, or too ignorant to raise extenuating factors. A knowl- edgeable union representative could assist the employer by eliciting favorable facts, and save the employer production time by getting to the bottom of the incident occasioning the interview. Certainly his presence need not transform the interview into an adversary context. Respondent suggests nonethe- less that union representation at this stage is unneces- sary because a decision as to employee culpability or disciplinary action can be corrected after the decision to impose discipline has become final. In other words, respondent would defer representation until the filing of a formal grievance challenging the employer’s determination of guilt after the employee has been discharged or otherwise disciplined. At that point, however, it becomes increasingly difficult for the employee to vindicate himself, and the value of repre- sentation is correspondingly diminished. The employer may then be more concerned with justifying his actions than re-examining them….

The responsibility to adapt the Act to changing patterns of industrial life is entrusted to the Board. The Court of Appeals impermissibly encroached upon the Board’s function in determining for itself that an employee has no “need” for union assistance at an investigatory interview. “While a basic purpose of Section 7 is to allow employees to engage in con- certed activities for their mutual aid and protection, such a need does not arise at an investigatory interview.” 485 F.2d, at 1138. It is the province of the Board, not the courts, to determine whether or not the “need” exists in light of changing industrial practices and the Board’s cumulative experience in dealing with labor-management relations. For the Board has the “special function of applying the gen- eral provisions of the Act to the complexities of industrial life,” NLRB v. Erie Resistor Corp., 373

U.S. 221, 236, … and its special competence in this field is the justification for the deference accorded its determination. American Ship Building Co. v. NLRB, 380 U.S., at 316…. Reviewing courts are of course not “to stand aside and rubber stamp” Board determi- nations that run contrary to the language or tenor of the Act,NLRB v. Brown, 380 U.S. 278, 291…. But the Board’s construction here, while it may not be required by the Act, is at least permissible under it, and insofar as the Board’s application of that meaning engages in the “difficult and delicate responsibility” of reconcil- ing conflicting interests of labor and management, the balance struck by the Board is “subject to limited judi- cial review.” NLRB v. Truck Drivers, 353 U.S. 87, 96 … In sum, the Board has reached a fair and rea- soned balance upon a question within its special com- petence, its newly arrived at construction of Section 7 does not exceed the reach of that section, and the Board has adequately explicated the basis of its interpretation.

The statutory right confirmed today is in full har- mony with actual industrial practice. Many important collective bargaining agreements have provisions that accord employees rights of union representation at investigatory interviews. Even where such a right is not explicitly provided in the agreement a “well- established current of arbitral authority” sustains the right of union representation at investigatory inter- views which the employee reasonably believes may result in disciplinary action against him. Chevron Chemical Co., 60 Lab. Arb. 1066, 1071 (1973)….

Judgment of Court of Appeals reversed and case remanded with direction to enter a judgment enforcing the Board’s order.

Case Questions

1. What Section 7 guarantee does the Court stress in its opinion?

2. Does the Court’s opinion give an unlimited right to an employee to have a union representative present when the employee is being questioned?

3. What is the Court’s primary reason for leaving unfair labor practice determinations to the NLRB rather than the courts?


CASE 5.2 IBM CORP. 174 LRRM 1537 (BNA 2004).

[IBM Corporation’s facility at Research Triangle Park, North Carolina, is a nonunion facility. In response to allegations of harassment contained in a letter from a former employee, an IBM manager interviewed three employees individually in October 2001, after denying each employee’s request to have a counselor present during the interview. All three were discharged approximately a month after the inter- views. An administrative law judge, applying the Epilepsy Foundation precedent, found that IBM vio- lated Section 8(a)(1) of the Act by denying each employee’s request for the presence of a coworker. A Board majority reversed the Epilepsy precedent in IBM.]

From the Opinion of the Board … Our reexamination of Epilepsy Foundation leads us to conclude that the policy considerations supporting that decision do not warrant, particu- larly at this time, adherence to the holding in Epilepsy Foundation. In recent years, there have been many changes in the workplace environment, including ever-increasing requirements to conduct workplace investigations, as well as new security concerns raised by incidents of national and work- place violence.

Our consideration of these features of the contem- porary workplace leads us to conclude that an employer must be allowed to conduct its required investigations in a thorough, sensitive, and confiden- tial manner. This can best be accomplished by permit- ting an employer in a nonunion setting to investigate an employee without the presence of a coworker…. We find the Charging Parties were not entitled to a coworker during the interviews…. Accordingly, we dismiss the complaint.

[Member Schaumber joined the majority opinion’s finding that policy considerations support the denial of the Weingarten right to the nonunionized work- place. He believes that the Weingarten right is unique to employees represented by a Section 9(a) bargaining representative.]

[Members Liebman and Walsh, Dissenting] … What is at stake is the Act’s guarantees for workers who are not represented by a union, today the great majority of American workers.* The Act applies to these workers, whether they know it or not, and whether or not the Board is prepared to give full recog- nition to that fact.… [M]odest as the Weingarten right is, it brings a measure of due process to workplace dis- cipline, particularly in nonunion workplaces, where employees and their representatives typically are at- will employees, who may be discharged or disciplined for any reason not specifically prohibited by law. “[T]he presence of a co-worker gives an employee a potential witness, advisor, and advocate in an adversarial situa- tion, and, ideally, militates against the imposition of unjust discipline by the employer.” Epilepsy Founda- tion, 268 F.3d at 1100…. They have overruled a sound decision not because they must, and not because they should, but because they can…. We dissent.

Case Questions

1. Section 7 of the NLRA states in part, “[e]mployees shall have the right … to engage in concerted activities for the purposes of … mutual aid or protection.” The Board’s construction of this language in Weingarten was that it created a stat- utory right in an employee to refuse to submit to an interview that the employee reasonably feared may result in discipline without union representation. Does this same language provide the same rights to unrepresented employees?

2. Did the dissenters concede that the Board majority could legally overrule the Epilepsy Foundation precedent?

3. List some advantages and disadvantages to having a coworker present at an investigatory interview.

*According to the Bureau of Labor Statistics, in 2003, only 8.2 percent of private-sector employees were unionized. U.S. Department of Labor, Bureau of Labor Statistics.



Section 2(5) of the NLRA broadly defines a labor organization as follows:

The term “labor organization” means any organization of any kind, or any agency or employee representation committee or plan, in which employees participate and which exists for the purpose, in whole or in part, of dealing with employers concerning grievances, labor disputes, wages, rates of pay, hours of employment, or conditions of work.

Section 8(a)(2) of the Act provides that it shall be an unfair labor practice for an employer:

to dominate or interfere with the formation or administration of any labor organiza- tion or contribute financial or other support to it: Provided, that subject to rules and regulations made and published by the Board pursuant to section 6, an employer shall not be prohibited from permitting employees to confer with him during working hours without loss of time or pay.

These provisions outlawing company-dominated labor organizations were a critical part of the Wagner Act, as revealed by the Act’s legislative history. Senator Robert Wagner stated in part:

Genuine collective bargaining is the only way to attain equality of bargaining power…. The greatest obstacles to collective bargaining are employer-dominated unions, which have multiplied with amazing rapidity since the enactment of [the National Industrial Recovery Act]. Such a union makes a sham of equal bargaining power…. [O]nly repre- sentatives who are not subservient to the employer with whom they deal can act freely in the interest of employees. For these reasons the very first step toward genuine collec- tive bargaining is the abolition of the employer-dominated union as the agency for dealing with grievances, labor disputes, wages, rates, or hours of employment.28

Congress thus brought within the coverage of the Act a broad range of employee groups, and it sought to ensure that such groups were free to act inde- pendently of their employer in representing employee interests.


Employer-formed and employer-dominated unions are outlawed by the NLRA in Section 8(a)(2). The Board can draw inferences as to domination in cases in which a company contributes aid financially or otherwise to the union, is instrumental in a union’s formation, or has its agents or supervisory staff solicit membership. The Board makes its decision on domination under the “totality of conduct” doctrine; namely, many little acts when summed up may place the conduct in the unfair labor practice category, even when the acts are unimportant taken individually. It is common for companies today to utilize employee involvement (EI) techniques such as joint employee-management committees that meet and look into safety issues and product quality issues. Such committees have proved to be very

28 Legislative History of the NLRA of 1935 (GPO, 1949), 15–16.


successful in helping employers make workplaces safer and have increased product quality, employee morale, and productivity. In unionized companies, these commit- tees are often fully supported by the unions, with union officers participating on the committees. However, when an employer is seeking to avoid bargaining with a union, the company cannot use a “safety and progress committee” to discuss and resolve an unlimited range of employee problems.29 Nor may an employer support and use EI committees as a means to supplant or substitute for a union as the exclusive bargaining representative on wages, hours, working conditions, and grievances.

In Electromation, Inc., presented in this section, the NLRB decided that certain action committees set up by the employer amounted to an illegal labor organiza- tion in violation of Section 8(a)(2) of the Act. The decision was a narrow one, however, and was not intended to suggest that employee committees formed under other circumstances for other purposes would necessarily be deemed a labor organization.


Employers have a range of options to communicate with, learn from, and inform employees. For example, an employer may schedule a brainstorming session on safety with both employees and management participation. In such a situation, there is no “dealing with” employees because the session is not designed as a bilat- eral mechanism to make and respond to specific proposals.30

An employer has unilateral mechanisms to elicit the views of its workforce as a whole, including suggestion boxes for employees to present proposals to manage- ment or surveys and general employee polls. What it cannot do is create a commit- tee of employees acting as a representative body along with employer representatives for dealing with each other, meeting on company property during working hours to address and agree on work rules, wages, and benefit issues.31


Although the law permits certain forms of cooperation between employers and minority or unrecognized unions, an employer crosses the line between cooperation and support, and thereby violates Section 8(a)(2), when it recognizes a minority union as the exclusive bargaining representative of its employers.32 Dana Corpora- tion and the UAW have had a longstanding bargaining relationship in nine bargain- ing units. In a 2–1 decision, the Board held that Dana did not cross the line from lawful cooperation with the UAW to unlawful support when it entered a letter of

29 Szabo v. U.S. Marine Corp., 819 F.2d 714 (7th Cir. 1987). 30 E.I. duPont Co., 311 NLRB 893, 894 (1993). 31 SeeWebcor Packaging, Inc. v. NLRB, 118 F.3d 1115 (6th Cir. 1997), cert. denied, 522 U.S. 1108 (1998). 32 ILGWU v. NLRB (Bernhard-Altmann), 366 U.S. 731 (1961), See also Majestic Weaving Co., 147 NLRB 859(1964), enforcement denied, 355 F.2d 854 (2d Cir. 1966), in which Board held that an employer violated Section 8(a)(2) and (1) by negotiating a complete colletive bargaining agreement, the signing of which was conditioned on the union’s achieving majority status.


agreement (LOA) with the UAW regarding its unrepresented workforce at its St. John’s, Michigan, facility and agreed to recognize the union there if the UAW obtained proof of majority status, which was to be determined in a check of authori- zation cards by a third party, with the LOA setting a framework that would inform any future bargaining on a comprehensive set of bargaining subjects. The dissent believed that the LOA did more than establish a procedural framework for future negotiations, but gave the UAW a say in the substantive terms of employment for Dana’s St. John’s employees, at a time when the UAW did not have majority support there. The case is presented in this section and it is often referred to as DANA II, to distinguish it from a 2007 Board decision involving the Dana Corporation which modified the “recognition bar doctrine,” as discussed in Section 4:13.

CASE 5.3 ELECTROMATION, INC. 309 NLRB 990 (1992).

[The respondent, Electromation, manufactures electri- cal components and employs some 200 employees. These employees were not represented by a labor organization during the relevant time period involved in this case. In late 1988, the company cut expenses by altering the existing employee attendance bonus policy and, in lieu of a wage increase for 1989, it distributed year-end lump-sum payments based on length of service. Shortly after these changes, the company received a petition signed by 68 employees expressing displeasure with the new attendance pol- icy. Thereafter, on January 11, company president John Howard met with a selected group of eight employees and discussed with them a number of issues, including wages, bonuses, incentive pay, atten- dance programs, and leave policy. Howard testified that it was decided after the January 11 meeting that “it was very unlikely that further unilateral man- agement action to resolve these problems was going to come anywhere near making everybody happy … and we thought that the best course of action would be to involve the employees in coming up with solu- tions to these issues.” Howard testified further that management came up with the idea of “action com- mittees” as a method to involve employees.

On January 19, the company posted a memoran- dum to all employees announcing the formation of five action committees and posted sign-up sheets for each action committee. The memorandum explained that each action committee would consist of six employees and one or two members of management as well as the employee benefits manager, Loretta Dickey, who would coordinate all the action

committees. The sign-up sheets explained the responsibilities and goals of each committee. No employees were involved in the drafting of the policy goals expressed in the sign-up sheets. The company determined the number of employees permitted to sign up for the action committees, and it informed two employees who had signed up for more than one committee that each would be limited to partici- pation on one committee. After the action commit- tees were organized, the Company posted a notice to all employees announcing the members of each com- mittee and the dates of the initial committee meet- ings. The action committees were designated as (1) Absenteeism Infractions, (2) No Smoking Policy, (3) Communication Network, (4) Pay Progression for Premium Positions, and (5) Attendance Bonus Program.

Dickey testified that management expected that employee members on the committees would “kind of talk back and forth” with the other employees in the plant and get their ideas, and that, indeed, the purpose of the postings was to ensure that “anyone [who] wanted to know what was going on, they could go to these people” on the action committees. The company paid employees for time spent on com- mittee work and supplied necessary materials. The Teamsters Union made a demand for recognition on February 13. On March 15, Howard informed employees that “due to the Union’s campaign, the Company would be unable to participate in the com- mittee meetings and could not continue to work with the committees until after the election,” which was to be held on March 31.]



From the Opinion of the Board … This case presents the issue of whether “Action Committees” composed, in part, of the Respondent’s employees constitute a labor organization within the meaning of Section 2(5) of the Act and whether the Respondent’s conduct vis-à-vis the “Action Commit- tees” violated Section 8(a)(2) and (1) of the Act. In the notice of hearing of May 14, 1991, the Board framed the pertinent issues as follows:

1. At what point does an employee committee lose its protection as a communication device and become a labor organization?

2. What conduct of an employer constitutes domi- nation or interference with the employee committee?….

… Congress viewed the abolition of employer- dominated organizations as essential to the Act’s pur- pose. After Congress passed the Act in 1935, a first order of business for the Board, backed by the Supreme Court, was to weed out employer- dominated organizations. Indeed, the very first unfair labor practice case decided by the Board raised the issues of whether an organization was a labor organi- zation under Section 2(5) and whether the employer had dominated that organization in violation of Sec- tion 8(a)(2) and (1). Pennsylvania Greyhound Lines, 1 NLRB 1 (1935), enfd. denied in part 91 F.2d 178 (3d Cir. 1937), revd. 303 U.S. 261 (1938). In that case, the Board, as affirmed by the Supreme Court, found that the organization at issue was an employee representation plan under Section 2(5), that the orga- nization was entirely the creation of management, which planned it, sponsored it, and foisted it on employees who had never requested it, and that the organization’s functions were described and given to it by management. 1 NLRB at 13–14.

The Greyhound plan was entirely typical of the “employee representation plans or committees” per- ceived as so pernicious by Senator Wagner and ulti- mately by Congress. Greyhound management founded the association in 1933. The manager charged with establishing the association wrote that

it is to our interest to pick out employees to serve on the committee who will work for the interest of the company and will not be radical. This plan of representation should work out very well providing the proper men are selected, and con- siderable thought should be given to the men placed on this responsible Committee.

Thus, Greyhound usurped from the employees their protected right to a bargaining representative of their own choosing when it set up and accorded recognition to a “committee” that was in no way an agent of the employees or loyal to their interests— although Greyhound management certainly intended that the committee appear to possess both those attributes.

In considering the interplay between Section 2(5) and Section 8(a)(2), we are guided by the Supreme Court’s opinion in NLRB v. Cabot Carbon Co., 360 U.S. 203 (1959). In Cabot Carbon the Court held that the term “dealing with” in Section 2(5) is broader than the term “collective bargaining” and applies to situations that do not contemplate the negotiation of a collective bargaining agreement….

… [O]ur inquiry is two-fold. First, we inquire whether the entity that is the object of the employer’s allegedly unlawful conduct satisfies the definitional elements of Section 2(5) as to (1) employee participa- tion, (2) a purpose to deal with employers, (3) con- cerning itself with conditions of employment or other statutory subjects, and (4) if an “employee represen- tation committee or plan” is involved, evidence that the committee is in some way representing the employees. Second, if the organization satisfies those criteria, we consider whether the employer has engaged in any of the three forms of conduct pro- scribed by Section 8(a)(2)….

Applying these principles to the facts of this case, we find, in agreement with the judge, that the Action Committees constitute a labor organization within the meaning of Section 2(5) of the Act; and that the Respondent dominated it, and assisted it, i.e., contrib- uted support, within the meaning of Section 8(a)(2).

First, there is no dispute that employees partici- pated in the Action Committees. Second, we find that the activities of the committees constituted deal- ing with an employer. Third, we find that the subject matter of that dealing—which included the treatment of employee absenteeism and employee remuneration in the form of bonuses and other monetary incentives —concerned conditions of employment. Fourth, we find that the employees acted in a representational capacity within the meaning of Section 2(5). Taken as a whole, the evidence underlying these findings shows that the Action Committees were created for, and actually served, the purpose of dealing with the Respondent about conditions of employment….

There can also be no doubt that the Respondents’ conduct vis-à-vis the Action Committees constituted



[The Dana Corporation manufactures automotive parts throughout the world, and Dana and the UAW have longstanding bargaining relationships in nine U.S. bargaining units. Dana also has facilities in the United States where employees are unrepresented. On August 6, 2003, Dana and the UAW entered into a letter of agreement (LOA), which set forth a framework to govern their relationship in the future

in the event that a majority of the employees at the St. John’s, Michigan, plant chose to designate the UAW as their exclusive collective bargaining represen- tative. Three Dana employees at the St. John’s facility filed unfair labor practice charges with the Board, and the General Counsel issued a complaint that the LOA was in violation of Sections 8(a)(2) and 8(b)(1) of the NLRA.]


“domination” in their formation and administration. It was the Respondent’s idea to create the Action Committees. When it presented the idea to employees on January 18, the reaction, as the Respondent’s Pres- ident Howard admitted, was “not positive.” Howard then informed employees that management would not “just unilaterally make changes” to satisfy employees’ complaints. As a result, employees essen- tially were presented with the Hobson’s choice of accepting the status quo, which they disliked, or undertaking a bilateral “exchange of ideas” within the framework of the Action Committees, as pre- sented by the Respondent. The Respondent drafted the written purposes and goals of the Action Commit- tees which defined and limited the subject matter to be covered by each Committee, determined how many members would compose a committee and that an employee could serve on only one committee, and appointed management representatives to the Committees to facilitate discussions. Finally, much of the evidence supporting the domination finding also supports a finding of unlawful contribution of support. In particular, the Respondent permitted the employees to carry out the committee activities on paid time within a structure that the Respondent itself created….

In sum, this case presents a situation in which an employer alters conditions of employment and, as a result, is confronted with a workforce that is discon- tented with its new employment environment. The employer responds to that discontent by devising and imposing on the employees an organized Com- mittee mechanism composed of managers and employees instructed to “represent” fellow employ- ees. The purpose of the Action Committees was, as

the record demonstrates, not to enable management and employees to cooperate to improve “quality” or “efficiency,” but to create in employees the impres- sion that their disagreements with management had been resolved bilaterally. By creating the Action Com- mittees the Respondent imposed on employees its own unilateral form of bargaining or dealing and thereby violated Section 8(a)(2) and (1) as alleged.

[The NLRB ordered the company to immediately disestablish and cease giving assistance or any other support to the Action Committees.]

[Concurring opinions were filed by three of the four Board members participating in the decision.]

[Note: The Teamsters Union lost the initial repre- sentation election at Electromation, Inc.: however, a rerun election was ordered, and the union won this election and was certified. Eventually, a collective bar- gaining contract was negotiated. In October 1993, a decertification petition was filed, but the employees again voted for the union. The parties thereafter reached an agreement on a three-year contract.]

Case Questions

1. Assess the fairness of the following statement in light of the Pennsylvania Greyhound Lines precedent case: “An employer-dominated organization robs employees of the freedom to choose their own representative.”

2. Read Section 8(a)(2) of the Act and identify the three forms of employer conduct prohibited by this section of the Act.

3. Did the employer’s conduct in this case constitute “domination” in the foundation and administra- tion of the Action Committees?


From the Opinion of the Board … The LOA’s introductory statement of purpose rec- ognized “that dramatic changes in the domestic auto- motive market ha[ve] created new quality, productivity and competitiveness challenges for the automotive component supplier.” It further stated that Dana and the UAW believed that “these chal- lenges will be more effectively met through a partner- ship that is more positive, non-adversarial and with constructive attitudes toward each other.” The intro- ductory statement continued:

Employee freedom to choose is a paramount concern of Dana as well as the UAW. We both believe that membership in a union is a matter of personal choice and acknowledge that if a majority of employees wish to be represented by a union, Dana will recognize that choice. The Union and the Company will not allow anyone to be intimidated or coerced into a decision on this important matter. The parties are also com- mitted to an expeditious procedure for deter- mining majority status.

The LOA then set forth ground rules for both par- ties that would be applicable in any organizing cam- paign the UAW might undertake at an unorganized Dana facility. Dana agreed to inform employees that it was “totally neutral regarding the issue of represen- tation by the Union” and that it has “a constructive and positive relationship with the UAW and that a National Partnership Agreement with the UAW exists in which both parties are committed to the success and growth” of Dana. Dana agreed to provide the UAW, upon request, with a list of the names and addresses of employees in any facility covered by the agreement and to permit the UAW to meet with employees in non- work areas. The parties made a no-strike/no-lockout commitment, effective at a given facility when the UAW requested an employee list for the facility and continuing until a first contract was negotiated or any contract-related dispute was resolved.

Dana agreed to recognize and bargain with the UAW upon proof of majority status, to be determined by a card check by a neutral third party. The LOA specified that Dana “may not recognize the Union as the exclusive representative of employees in the absence of a showing” of majority status.…

… Article 4.2.4 [of the LOA] provided as follows:

The parties agree that in labor agreements bar- gained pursuant to this Letter, the following

conditions must be included for the facility to have a reasonable opportunity to succeed and grow.

• Healthcare costs that reflect the competitive reality of the supplier industry and product(s) involved

• Minimum classifications Team-based approaches • The importance of attendance to productivity

and quality • Dana’s idea program (two ideas per person per

month and 80% implementation) • Continuous improvement • Flexible compensation • Mandatory overtime when necessary (after

qualified volunteers) to support the customers.

The LOA also specified steps that the parties would take if they were unable to reach a final agreement. Article 4.2 provided that, after 5 months, the parties would submit unresolved issues to a joint UAW/Dana committee. If 6 months were to pass without a con- tract, the parties would submit unresolved issues to a neutral for interest arbitration, and the neutral would select either Dana’s final offer or the UAW’s.…

Although the law permits certain forms of coopera- tion between employers and minority or unrecognized unions, an employer crosses the line between coopera- tion and support, and violates Section 8(a)(2), when it recognizes a minority union as the exclusive bargaining representative. This is the principle reflected in the Supreme Court’s decision in Bernhard-Altmann, supra.…

Here, the LOA did no more than create a frame- work for future collective bargaining, if (as specified in the agreement) the UAW were first able to provide proof of majority status by means of a card-check conducted by a neutral third party. The LOA did not contain an exclusive-representation provision (the “vice” of the agreement in Bernhard-Altmann). Indeed, the LOA expressly prohibited Dana from recognizing the UAW without a showing of majority support. Only the negotiation of the LOA, and no other conduct, is alleged to be an unfair labor prac- tice interfering with employee free choice.…

The ultimate object of the National Labor Rela- tions Act, as the Supreme Court has repeatedly stated, is “industrial peace.” … Section 1 of the Act states that the goal of industrial peace is to be achieved by “encouraging the practice and procedure of collective bargaining,” as well as by “protecting the exercise by



In the Jones & Laughlin Steel decision (see Chapter 4), the Supreme Court dis- cussed how Section 8 of the NLRA forbids all forms of employer discrimination tending to encourage as well as discourage membership in a labor union. This rule is subject to the proviso that an employer may lawfully terminate an individ- ual in instances where the labor organization is functioning under authority of a union shop or maintenance-of-membership agreement and the union seeks the discharge of an employee because of failure to pay dues or initiation fees. (See Section 5:8.)

workers of full freedom of association, self- organization, and designation of representatives of their own choosing.” …

As discussed earlier, it is well settled, consistent with those policies, that an employer may voluntar- ily recognize a union that has demonstrated majority support by means other than an election, including (as contemplated by the LOA in the present case) authorization cards signed by a majority of the unit employees. Courts have endorsed voluntary rec- ognition and deemed it “a favored element of national labor policy.”… The Board should hesitate before creating new obstacles to voluntary recognition, as adopting the General Counsel’s posi- tion would do.…

Certainly, the statutory policies of encouraging collective bargaining and voluntary recognition must comport with Section 8(a)(2) and its goals of preserv- ing union independence and protecting employee free choice. In our view, however, the General Counsel’s position does little to further the aims of Section 8(a) (2) and much to frustrate legitimate, indeed desirable, forms of union-employer cooperation. Categorically prohibiting prerecognition negotiations over substan- tive issues would needlessly preclude unions and employers from confronting workplace challenges in a strategic manner that serves the employer’s needs, creates a more hospitable environment for collective bargaining, and—because no recognition is granted unless and until the union has majority support— still preserves employee free choice. …

Conclusion Accordingly, we find that Dana, by entering into the LOA, did not cross the line from lawful cooperation with the UAW to unlawful support of it. Likewise,

the UAW has not accepted unlawful support from Dana.

Order The complaint is dismissed.

MEMBER HAYES, dissenting. In Majestic Weaving Co., 147 NLRB 859 (1964), enf. denied 355 F.2d 854 (2d Cir. 1966), the Board found that an employer violated the Act when it negotiated a complete collective-bargaining agreement with a minority union. In the present case, the Respondent Dana negotiated substantive contract provisions in a Letter of Agreement (LOA) with minority union Respondent UAW. There are no meaningful factual or legal distinctions between the two cases. By dismiss- ing the complaint, my colleagues effectively overrule Majestic Weaving, at least in substantial part, an action they have recently conceded cannot be taken by less than a three-member Board majority.…

Case Questions

1. Read the content of the LOA. Upon what ratio- nal basis would the employer voluntarily meet with the union and agree to the LOA, rather than insist that the UAW follow the usual Board representation procedures with a secret-ballot election?

2. May card-check/neutrality agreements be utilized to legally determine majority support for a union?

3. Did the dissent believe that the parties did more than establish a procedural framework, and in fact negotiated substantive contract provisions with a minority union, contrary to the Board’s Majestic Weaving precedent? Identify some substantive provisions, if any.


The NLRB has found evidence of discrimination against active union supporters where the employer:

1. Gives inconsistent reasons for discharge 2. Discharges on the strength of past misdeeds that were condoned 3. Neglects to give customary warning prior to discharge 4. Discharges for a rule generally unenforced 5. Applies disproportionately severe punishment to union supporters 6. Effects layoffs in violation of seniority status with disproportionate impact on

union supporters

On the one hand, the NLRA preserves the right of the employer to maintain control over the workforce in the interest of discipline, efficiency, and pleasant and safe customer relations. Employees, on the other hand, have the right to be free from coercive discrimination resulting from union activity. Job applicants, as in the Phelps Dodge case referenced in Chapter 4, also receive the same protection from illegal discrimination.

At times, these two rights may collide. For example, an employee may be discharged for apparently two reasons: (1) violation of a valid company rule and (2) union activity. The former is given by the employer as the reason for termina- tion; the latter remains unstated on the employer’s part, causing the labor organi- zation to file a Section 8(a)(3) charge against the employer. These are known as dual-motive cases.

The Wright Line33 decision set forth a new standard to be applied to all Section 8(a)(3) cases and cases turning on employer motivation, including dual- motive situations. Under the Board’s Wright Line test, the General Counsel must make, on behalf of the dismissed employee, a prima facie showing sufficient to support the inference that protected conduct such as union activity was a “moti- vating factor” in the employer’s decision. After this showing, the burden shifts to the employer, who must demonstrate that the employee would have been dismissed for legitimate business reasons even absent the protected conduct.

The Board restated the Wright Line test in a 1996 decision as follows:

The General Counsel has the burden to persuade that antiunion sentiment was a substantial or motivating factor in the challenged employer decision. The burden of persuasion then shifts to the employer to prove its affirmative defense that it would have taken the same action even if the employees had not engaged in protected activity.34

33 251 NLRB 1083 (1980). 34 The Wright Line test was approved in 1983 by the Supreme Court in the NLRB v. Transportation Management decision, reported in this section. In the Supreme Court’s Office of Workers Compensa- tion Programs, Department of Labor v. Greenwich Collieries decision, 512 U.S. 267 (1994), the Court made clear that the ultimate burden of persuasion remains with the General Counsel, regardless of the language used in the 1983 Transportation Management case. The Court added that once the General Counsel establishes that antiunion animus was a motivating factor, the employer bears the burden of establishing any affirmative defense. Accordingly, the Board restated the Wright Line test in terms of burden to persuade in its Manno Electric decision, 321 NLRB 278, at footnote 12 (1996).


This two-step standard reconciles the rights of the employee and the employer. The first step, a prima facie showing that protected conduct was a motivating fac- tor in the dismissal, allows the administrative law judge and the Board to consider whether the evidence shows that it is likely that the employee’s rights have been violated by the employer. The second step, where the burden of persuasion shifts to the employer to prove that the employee would have been dismissed for legiti- mate business reasons even absent the protected conduct, allows the administrative law judge and the Board to consider the evidence and interests of the employer in dismissing the employee.

The General Counsel’s case on behalf of an employee may be insufficient to show that union activity was a motivating factor in the dismissal. However, when a prima facie case is made for an employee, the ALJ and the Board may determine that the reasons offered by the employer for the discharge were a “pretext.”35

Reasons for termination not accepted by the Board were noted at the start of this section. Examples of legitimate reasons for termination may be dishonesty, assault on a supervisor or fellow employee, aggravated sexual harassment, gross insubordi- nation, unlawful strike activity, use of intoxicants or drugs on company premises, or discharge in accordance with progressive discipline for absences and tardiness.

The Transportation Management Corp. decision of the Supreme Court, which unanimously confirmed the Wright Line test, is presented in this section. In Emerson Electric Co. v. NLRB,36 the Court of Appeals for the Eighth Circuit held that the employee’s support of a union plus the supervisor’s knowledge of the employee’s union activities were not sufficient to support an inference that the employee’s discharge was motivated by antiunion considerations.


[Prior to his discharge, Sam Santillo was a bus driver for respondent Transportation Management Corp. On March 19, 1979, Santillo talked to officials of the Teamsters Union about organizing the drivers who worked with him. Over the next four days, San- tillo discussed with his fellow drivers the possibility of

joining the Teamsters and distributed authorization cards. On the night of March 23, George Patterson, who supervised Santillo and the other drivers, told one of the drivers that he had heard of Santillo’s activities. Patterson referred to Santillo as two-faced and promised to get even with him. Later that


35 In modern-day labor relations, an employer will rarely, if ever, baldly assert that it has disciplined an employee because it detests unions or will not tolerate employees engaging in union or other pro- tected activities. Instead, it will generally advance what it asserts to be a legitimate business reason for its action. Examination of the evidence may reveal, however, that the asserted justification is a sham in that the purported rule or circumstance advanced by the employer did not exist or was not, in fact, relied upon. When this occurs, the reason advanced by the employer may be termed pretextual. Because no legitimate business justification for the discipline exists, there is, by strict definition, no dual motive. Nevertheless, the Wright Line steps are applicable to all such Section 8(a)(3) cases. 36 573 F.2d 543 (8th Cir. 1978).


evening Patterson talked to Ed West, who was also a bus driver for respondent. Patterson asked, “What’s with Sam and the union?” Patterson said that he took Santillo’s actions personally, recounted several favors he had done for Santillo, and added that he would remember Santillo’s activities when Santillo again asked for a favor. On Monday, March 26, Santillo was discharged. Patterson told Santillo that he was being fired for leaving his keys in the bus and taking unauthorized breaks. Santillo filed charges with the Board, and the General Counsel issued a complaint contending that Santillo was discharged because of his union activities in distributing authorization cards to fellow employees. The administrative law judge determined that Patterson’s disapproval of Santillo’s practice of leaving his keys in the bus was clearly a pretext and that the practice of leaving keys in buses was commonplace among company employ- ees. The company identified two types of unautho- rized breaks: coffee breaks and stops at home. With respect to both coffee breaks and stopping at home, the ALJ found that Santillo was never cautioned or admonished about such behavior and that the employer had not followed its customary practice of issuing three written warnings before discharging a driver. The ALJ also found that the taking of coffee breaks during work hours was normal practice and that the company tolerated the practice unless the breaks interfered with the driver’s performance of his duties. The ALJ found that the company had never taken any adverse personnel action against an employee because of such behavior. The Board adopted the ALJ’s findings and expressly applied its Wright Line decision. The First Circuit Court of Appeals refused to enforce the Board’s order. The Supreme Court granted certiorari.]

WHITE, J.… The Court of Appeals for the First Circuit refused enforcement of the Wright Line decision because in its view it was error to place the burden on the employer to prove that the discharge would have occurred had the forbidden motive not been present. The General Coun- sel, the Court of Appeals held, had the burden of show- ing not only that a forbidden motivation contributed to the discharge but also that the discharge would not have taken place independently of the protected conduct of the employee. The Court of Appeals was quite correct, and the Board does not disagree, that throughout the proceedings, the General Counsel carries the burden of

proving the elements of an unfair labor practice. Section 10(c) of the Act, 29 U.S.C. § 160(c), expressly directs that violations may be adjudicated only “upon the pre- ponderance of the testimony” taken by the Board. The Board’s rules also state “the Board’s attorney has the burden of pro[ving] violations of Section 8.” 29 CFR § 101.10(b). We are quite sure, however, that the Court of Appeals erred in holding that § 10(c) for- bids placing the burden on the employer to prove that absent the improper motivation he would have acted in the same manner for wholly legitimate reasons….

We assume that the Board could reasonably have construed the Act in the manner insisted on by the Court of Appeals…. The Board has instead chosen to recognize, as it insists it has done for many years, what it designates as an affirmative defense that the employer has the burden of sustaining. We are unpre- pared to hold that this is an impermissible construc- tion of the Act…. “[T]he Board’s construction here, while it may not be required by the Act, is at least permissible under it…,” and in these circumstances its position is entitled to deference….

The Board’s allocation of the burden of proof is clearly reasonable in this context, for the reason stated in NLRB v. Remington Rand, 94 F.2d 862 (1938), a case on which the Board relied when it began taking the position that the burden of persua- sion could be shifted. The employer is a wrongdoer; he has acted out of a motive that is declared illegiti- mate by the statute. It is fair that he bear the risk that the influence of legal and illegal motives cannot be separated, because he knowingly created the risk and because the risk was created not by innocent activity but by his own wrongdoing….

The Board was justified in this case in concluding that Santillo would not have been discharged had the employer not considered his efforts to establish a union. At least two of the transgressions that purportedly would have in any event prompted Santillo’s discharge were commonplace, and yet no transgressor had ever before received any kind of discipline. Moreover, the employer departed from its usual practice in dealing with rules infractions; indeed, not only did the employer not warn Santillo that his actions would result in being subjected to discipline, it never even expressed its disapproval of his conduct. In addition, Patterson, the person who made the initial decision to discharge Santillo, was obviously upset with Santillo for engaging in such protected activity. It is thus clear that the




The legality of a layoff or lockout of employees during bargaining raises issues con- cerning the motive of the employer and the effect on the employee’s rights. If a defensive act is undertaken to protect the employer’s business in the face of a threatened strike or to improve the employer’s bargaining position rather than to interfere with bargaining rights or union activity, no violation of the Act occurs. The NLRB had been inclined to conclude that anything is illegal except a strictly defensive shutdown. The courts, however, have been willing to allow the employer more freedom temporarily to use a lockout, as in the Brown case presented next, reversing the NLRB ruling of illegality.

In the so-called Buffalo Linen decision, Truck Drivers Local 449 v. NLRB,37

the Board determined that a lockout for defending a multiemployer bargaining unit was legal. The Supreme Court agreed. In Buffalo Linen, one employer member was struck as a whipsaw tactic by the union to pressure the others, and the others legally locked out their employees to defend their position. However, a lockout to force a union to accept multiemployer bargaining rather than to protect the exist- ing unit is an illegal offensive lockout, according to the Board.38

In American Shipbuilding Co. v. NLRB,39 the “defensive lockout” theory of Brown was extended. The Supreme Court reversed the Board’s ruling of discrimi- nation. The Supreme Court found no antiunion or antibargaining motives in an employer’s shutdown designed to improve the employer’s economic position in negotiating. The Court held that “there is nothing in the Act which gives employees the right to insist on their contract demands, free from the sort of economic disad- vantage which frequently attends bargaining disputes. Therefore, we conclude that where the intention proven is merely to bring about a settlement of a labor dispute on favorable terms, no violation of Section 8(a)(3) is shown.”

Board’s finding that Santillo would not have been fired if the employer had not had an anti-union ani- mus was “supported by substantial evidence on the record considered as a whole,” 29 U.S.C. § 160(f).

Accordingly the judgment is Reversed.

Case Questions

1. According to the General Counsel’s position, why was Santillo fired by his employer?

2. Why was Santillo fired, according to the company?

3. Did the Supreme Court find that the Board was justified in concluding that Santillo would not have been discharged had the employer not considered his efforts to establish a union?

4. Did the Supreme Court agree with the court of appeals that Section 10(c) of the Act forbids placing the burden on the employer to prove that, absent the improper motivation, the employer would have acted in the same manner for wholly legitimate reasons?

37 353 U.S. 87 (1956). 38 Great Atlantic and Pacific Tea Co., 145 NLRB 361 (1963). 39 380 U.S. 300 (1965).



BRENNAN, J.… The respondents, who are members of a multiemployer bargaining group, locked out their employees in response to a whipsaw strike against another member of the group [Food Jet, Inc.]. They and the struck employer continued operations with temporary replacements. The National Labor Relations Board found that the struck employer’s use of temporary repla- cements was lawful under Labor Board v. Mackay Radio & Telegraph Co., 304 U.S. 333, but that the respondents had violated Sections 8(a)(1) and (3) of the National Labor Relations Act by locking out their regular employees and using temporary replacements to carry on business. 137 NLRB 73. The Court of Appeals for the Tenth Circuit disagreed and refused to enforce the Board’s order. 319 F.2d 7. We granted cer- tiorari, 375U.S. 962.We affirm the Court of Appeals….

The Board’s decision does not rest upon indepen- dent evidence that the respondents acted either out of hostility toward the Local or in reprisal for the whip- saw strike. It rests upon the Board’s appraisal that the respondent’s conduct carried its own indicia of unlawful intent, thereby establishing, without more, that the conduct constituted an unfair labor practice. It was disagreement with this appraisal, which we share, that led the Court of Appeals to refuse to enforce the Board’s order.

It is true that the Board need not inquire into employer motivation to support a finding of an unfair practice where the employer conduct is demonstrably destructive of employee rights and is not justified by the service of significant or important business ends. See, e.g., Labor Board v. Erie Resistor Corp., 373 U.S. 221. We agree with the Court of Appeals that, in the setting of this whipsaw strike and Food Jet’s continued operations, the respondents’ lockout and their continued operations with the use of temporary replacements, viewed separately or as a single act, do not constitute such conduct.

We begin with the proposition that the Act does not constitute the Board as an “arbiter of the sort of economic weapons the parties can use in seeking to gain acceptance of their bargaining demands.” In the absence of proof of unlawful motivation, there are many economic weapons which an employer may use that either interfere in some measure with concerted employee activities, or which are in some degree discriminatory and discourage union

membership, and yet the use of such economic weapons does not constitute conduct that is within the prohibition of either Section 8(a)(1) or Section 8 (a)(3). Even the Board concedes that an employer may legitimately blunt the effectiveness of an antici- pated strike by stockpiling inventories, readjusting contract schedules, or transferring work from one plant to another, even if he thereby makes himself “virtually strikeproof.” As a general matter he may completely liquidate his business without violating either Section 8(a)(1) or Section 8(a)(3), whatever the impact of his action on concerted employee activities. Textile Workers v. Darlington Mfg. Co., Nos. 37 and 41, decided today. Specifically, he may in various circumstances use the lockout as a legiti- mate economic weapon. And in American Ship Building Co. v. Labor Board, No. 255, decided today, we hold that lockout is not an unfair labor practice simply because used by an employer to bring pressure to bear in support of his bargaining position after an impasse in bargaining negotiations has been reached.

In the circumstances of this case, we do not see how the continued operations of respondents and their use of temporary replacements any more imply hostile motivation, nor how they are inherently more destructive of employee rights, than is the lockout itself. Rather, the compelling inference is that this was all part and parcel of respondents’ defensive mea- sure to preserve the multiemployer group in the face of the whipsaw strike….

… In determining here that the respondents’ con- duct carried its own badge of improper motive, the Board’s decision, for the reasons stated, misapplied the criteria for governing the application of Sec- tion 8(a)(1) and (3). Since the order therefore rested on an “erroneous legal foundation,” the Court of Appeals properly refused to enforce it.


Case Questions

1. What factual difference existed between the Buffalo Linen case referred to in the text and the Brown case?

2. Why did the Court reverse the Board’s decision? 3. What is an illegal lockout? 4. What is meant by a whipsaw strike?



As distinct from a temporary shutdown or layoff, the permanent shutdown of a unionized company raises some other difficult questions. In the liquidation of an operation, a violation of Section 8(a)(3) may be found by the NLRB if union mem- bership or avoidance of collective bargaining is found to be the controlling motiva- tion. A Section 8(a)(3) violation does not exist where legitimate economic considerations rather than antiunion reasons were the controlling factors.

In the Darlington Manufacturing Co. case, presented in this section, a recently unionized company owned by a multiplant parent corporation was liquidated. Some economic factors, as well as unionization, contributed to its shutting down. The employer’s claim of an absolute right to go out of business was denied by the NLRB. The court of appeals refused to enforce the Board’s order, and the matter was remanded to the Board by the Supreme Court for further evidence as to any coercive impact of the shutdown on employees at other plants of the parent corpo- ration. The Court held that the mill closing was an unfair labor practice under Section 8(a)(3) “if motivated by a purpose to chill unionism in any of the remain- ing plants … much the same as that found to exist in runaway shop and temporary closing cases.” On remand to the Board, the employer’s closing and liquidation of the plant were found to be in violation of Section 8(a)(3). As a remedy, the employer was ordered to offer terminated employees jobs at other plants where work was available, with travel and moving expenses to be paid by the employer for those who accepted such work. The employer was ordered to pay back wages to the employees less their interim earnings until such time as they obtained compa- rable employment or were offered comparable jobs at the employer’s other plants.40 The litigation continued thereafter before the Board and the courts until December 1980 when the parent corporation agreed to pay $5 million in back pay. Prior to this agreement, no employee terminated as a result of the closing of the textile mill in 1956 had received any compensation for the unlawful shutdown. The settlement agreement marked the end of the most protracted labor dispute in American history.


HARLAN, J.… We here review a judgment of the Court of Appeals refusing to enforce an order of the National Labor Relations Board which found respondent Darlington guilty of an unfair labor practice by reason of having permanently closed its plant following petitioner union’s election as the bargaining representative of Darlington’s employees.

Darlington Manufacturing Company was a South Carolina corporation operating one textile mill. A majority of Darlington’s stock was held by Deering Milliken, a New York “selling house” marketing textiles produced by others. Deering Milliken in turn was controlled by Roger Milliken, president of Darlington, and by other members of the Milliken family. The National Labor Relations Board found


40 165 NLRB 1074 (1967), enforced, 397 F.2d 760 (4th Cir. 1968).


that the Milliken family, through Deering Milliken, operated 17 textile manufacturers, including Darling- ton, whose products, manufactured in 27 different mills, were marketed through Deering Milliken.

In March 1956 petitioner Textile Workers Union initiated an organizational campaign at Darlington which the company resisted vigorously in various ways, including threats to close the mill if the union won a representation election. On September 6, 1956, the union won an election by a narrow margin. When Roger Milliken was advised of the union victory, he decided to call a meeting of the Darlington board of directors to consider closing the mill. Mr. Milliken testified before the Labor Board:

I felt that as a result of the campaign that had been conducted and the promises and statements made in these letters that had been distributed [favoring unionization], that if before we had had some hope, possible hope of achieving competitive [costs] … by taking advantage of new machinery that was being put in, that this hope had diminished as a result of the election because a majority of the employees had voted in favor of the union… (R. 457).

The board of directors met on September 12 and voted to liquidate the corporation, action which was approved by the stockholders on October 17. The plant ceased operations entirely in November, and all plant machinery and equipment was sold piece- meal at auction in December.

The Union filed charges with the Labor Board claiming that Darlington had violated Section 8(a)(1) and (a)(3) of the National Labor Relations Act by closing its plant, and Section 8(a)(5) by refusing to bargain with the union after the election. The Board, by a divided vote, found that Darlington had been closed because of the antiunion animus of Roger Milliken, and held that to be a violation of Sec- tion 8(a)(3). The Board also found Darlington to be part of a single integrated employer group controlled by the Milliken family through Deering Milliken; therefore Deering Milliken could be held liable for the unfair labor practices of Darlington. Alternatively, since Darlington was a part of the Deering Milliken enterprise, Deering Milliken had violated the Act by closing part of its business for a discriminatory purpose. The Board ordered back pay for all Darlington employees until they obtained substantially equivalent work or were put on

preferential hiring lists at the other Deering Milliken mills. Respondent Deering Milliken was ordered to bargain with the union in regard to details of com- pliance with the Board order. 139 NLRB 241.

On review, the Court of Appeals … denied enforcement by a divided vote. 325 F.2d 682. The Court of Appeals held that even accepting arguendo the Board’s determination that Deering Milliken had the status of a single employer, a company has the absolute right to close out a part or all of its business regardless of antiunion motives. The court therefore did not review the Board’s finding that Deering Milliken was a single integrated employer. We granted certiorari, 377 U.S. 903, to consider the important questions involved. We hold that so far as the Labor Relations Act is concerned, an employer has the absolute right to terminate his entire business for any reason he pleases, but disagree with the Court of Appeals that such right includes the ability to close part of a business no matter what the reason. We conclude that the case must be remanded to the Board for further proceedings….

[The Court hereinafter considers whether the clos- ing, if discriminatorily motivated, is in violation of Section 8(a)(3) of the NLRA.]

We consider first the argument, advanced by the petitioner union but not by the Board, and rejected by the Court of Appeals, that an employer may not go completely out of business without running afoul of the Labor Relations Act if such action is prompted by a desire to avoid unionization. Given the Board’s finding on the issue of motive, acceptance of this con- tention would carry the day for the Board’s conclu- sion that the closing of this plant was an unfair labor practice, even on the assumption that Darlington is to be regarded as an independent unrelated employer. A proposition that a single businessman cannot choose to go out of business if he wants to would represent such a startling innovation that it should not be enter- tained without the clearest manifestation of legislative intent or unequivocal judicial precedent so construing the Labor Relations Act. We find neither.

So far as legislative manifestation is concerned, it is sufficient to say that there is not the slightest indi- cation in the history of the Wagner Act or of the Taft- Hartley Act that Congress envisaged any such result under either statute….

We are not presented here with the case of a “run- away shop,” whereby Darlington would transfer its work to another plant or open a new plant in another



locality to replace its closed plant. Nor are we con- cerned with a shutdown where the employees, by renouncing the union, could cause the plant to reopen. Such cases would involve discriminatory employer action for the purpose of obtaining some benefit from the employees in the future. We hold here only that when an employer closes his entire business, even if the liquidation is motivated by vin- dictiveness toward the union, such action is not an unfair labor practice….

The closing of an entire business, even though dis- criminatory, ends the employer-employee relation- ship; the force of such a closing is entirely spent as to that business when termination of the enterprise takes place. On the other hand, a discriminatory par- tial closing may have repercussions on what remains of the business, affording employer leverage for dis- couraging the free exercise of Section 7 rights among remaining employees of much the same kind as that found to exist in the “runaway shop” and “tempo- rary closing” cases. Moreover, a possible remedy open to the Board in such a case like the remedies available in the “runaway shop” and “temporary closing” cases, is to order reinstatement of the dis- charged employees in the other parts of the business. No such remedy is available when an entire business has been terminated. By analogy to those cases involving a continuing enterprise we are constrained to hold, in disagreement with the Court of Appeals, that a partial closing is an unfair labor practice under Section 8(a)(3) if motivated by a purpose to chill unionism in any of the remaining plants of the single employer and if the employer may reasonably have foreseen that such closing would likely have that effect.

While we have spoken in terms of a “partial clos- ing” in the context of the Board’s finding that Dar- lington was part of a larger single enterprise controlled by the Milliken family, we do not mean to suggest that an organizational integration of plants or corporations is a necessary prerequisite to the establishment of such a violation of Section 8(a)(3). If the persons exercising control over a plant that is being closed for antiunion reasons (1) have an interest in another business, whether or not affiliated with or engaged in the same line of commercial activity as the closed plant, of sufficient substantiality to give prom- ise of their reaping a benefit from the discouragement of unionization in that business; (2) act to close their plant with the purpose of producing such a result;

and (3) occupy a relationship to the other business which makes it realistically foreseeable that its employees will fear that such business will also be closed down if they persist in organization activities, we think that an unfair labor practice has been made out.

Although the Board’s single employer finding nec- essarily embraced findings as to Roger Milliken and the Milliken family which, if sustained by the Court of Appeals, would satisfy the elements of “interest” and “relationship” with respect to other parts of the Deering Milliken enterprise, that and the other Board findings fall short of establishing the factors of “pur- pose” and “effect” which are vital requisites of the general principles that govern a case of this kind.

Thus, the Board’s findings as to the purpose and foreseeable effect of the Darlington closing pertained only to its impact on the Darlington employees. No findings were made as to the purpose and effect of the closing with respect to the employees in the other plants comprising the Deering-Milliken group. It does not suffice to establish the unfair labor practice charged here to argue that the Darlington closing nec- essarily had an adverse impact upon unionization in such other plants. We have heretofore observed that employer action which has a foreseeable consequence of discouraging concerted activities generally does not amount to a violation of Section 8(a)(3) in the absence of a showing of motivation which is aimed at achieving the prohibited effect. See Teamsters Local v. Labor Board, 365 U.S. 667, and the concur- ring opinion therein, at 677. In an area which trenches so closely upon otherwise legitimate employer prerogatives, we consider the absence of Board findings on this score a fatal defect in its decision….

In these circumstances, we think the proper disposi- tion of this case is to require that it be remanded to the Board so as to afford the Board the opportunity tomake further findings on the issue of purpose and effect.

It is so ordered.

Case Questions

1. State the facts of the case. 2. May an employer close down its business for any

reason it pleases? 3. What remedy did the Board order? 4. Summarize the rule promulgated by the Supreme




Different types of strikes and pressure tactics will be discussed in Chapter 7 with explanations of the extent of legal protection for the participants. During an eco- nomic strike, an employer may legally replace such strikers permanently. However, economic strikers who unconditionally apply for reinstatement and make known their continued availability are entitled to reinstatement by the employer as long as a vacancy exists for which they are qualified. If the strikers have been permanently replaced, they are entitled to reinstatement when permanent replacements leave their jobs. Strikers violating the unfair labor practices of Section 8(b) or a no- strike contract provision or engaging in other serious misconduct may be lawfully discharged on a nondiscriminatory basis. Employer unfair labor practice strikers receive full reinstatement protection regardless of the replacements, with back pay ordered from the date of a refusal to reemploy upon request up to the date of reemployment in the vast majority of cases.

When strikers’ job rights exist, it is illegal for the employer to deprive strikers of seniority rights by giving superior seniority or superseniority to replacements or to those strikers returning to work first. In NLRB v. Erie Resistor Corp.,41 a strike was called when bargaining on a new contract reached an impasse. The company, under intense competitive pressures, decided to continue production operations, and after a period of weeks, it notified the union that it would begin hiring replacements. Several weeks later the company informed the union that it had decided to award 20 years additional seniority—for credit against future layoffs—to replacements and strikers who returned by a certain date. The union charged that this granting of superseniority during a strike was an unfair labor practice. The Supreme Court held that such action unavoidably discouraged protected collective activities and must have been so intended. A weighing process was used to consider the conflict between the employer’s interest in operating its business in a particular way and the employ- ees’ interest in concerted economic action. Answering the problem, the Court said the employer’s asserted business purpose did not balance the violation of the strikers’ rights in light of the federal law’s deference to the strike weapon.

The Great Dane Trailer case presented next deals with another type of employer action affecting economic strikers. In this case, the employer paid accrued vacation benefits to nonstrikers and announced the extinction of these benefits to strikers. The Supreme Court considered the factor of employer motivation in the context of a Section 8(a)(3) violation and set forth the controlling principles.


WARREN, C. J.… The issue here is whether, in the absence of proof of an antiunion motivation, an employer may be held to have violated Sections 8(a)(3) and (1) of the

National Labor Relations Act when it refused to pay striking employees vacation benefits accrued under a terminated collective bargaining agreement while it announced an intention to pay such benefits

41 373 U.S. 221 (1963).



to striker replacements, returning strikers, and non- strikers who had been at work on a certain date during the strike.

The respondent company and the union entered into a collective bargaining agreement which was effective by its terms until March 31, 1963…. In essence, the company agreed to pay specified vacation benefits to employees who, during the preceding year, had worked at least 1,525 hours. It was also provided that, in the case of a “lay-off, termination or quit- ting,” employees who had served more than 60 days during the year would be entitled to pro rata shares of their vacation benefits. Benefits were to be paid on the Friday nearest July 1 of each year.

The agreement was temporarily extended beyond its termination date, but on April 30, 1963, the union gave the required 15 days’ notice of intention to strike over issues which remained unsettled at the bargaining table. Accordingly, on May 16, 1963, approximately 350 of the company’s 400 employees commenced a strike which lasted until December 26, 1963. The company continued to operate dur- ing the strike, using nonstrikers, persons hired as replacements for strikers, and some original strikers who had later abandoned the strike and returned to work. On July 12, 1963, a number of the strikers demanded their accrued vacation pay from the com- pany. The company rejected this demand, basing its response on the assertion that all contractual obliga- tions had been terminated by the strike and, there- fore, none of the company’s employees had a right to vacation pay. Shortly thereafter, however, the company announced that it would grant vacation pay—in the amounts and subject to the conditions set out in the expired agreement—to all employees who had reported for work on July 1, 1963. The company denied that these payments were founded on the agreement and stated that they merely reflected a new “policy” which had been unilater- ally adopted.

The refusal to pay vacation benefits to strikers, coupled with the payments to nonstrikers, formed the basis of an unfair labor practice complaint filed with the Board while the strike was still in prog- ress…. [The Board held that the company had vio- lated Sections 8(a)(3) and 8(a)(1) of the NLRA, and the Fifth Circuit Court of Appeals denied enforce- ment of the Board’s order.]

But inquiry under Section 8(a)(3) does not usually stop at this point. The statutory language “discrimi- nation … to … discourage” means that the finding of a violation normally turns on whether the discrimina- tory conduct was motivated by an antiunion purpose. American Ship Building Co. v. Labor Board, 380 U.S. 300 (1965). It was upon the motivation element that the Court of Appeals based its decision not to grant enforcement, and it is to that element which we now turn. In three recent opinions we considered employer motivation in the context of asserted Section 8(a)(3) violations. American Ship Building Co. v. Labor Board, supra; Labor Board v. Brown, 380 U.S. 278 (1965); and Labor Board v. Erie Resistor Corp., supra….

From this review of our recent decisions, several principles of controlling importance here can be dis- tilled. First, if it can reasonably be concluded that the employer’s discriminatory conduct was “inherently destructive” of important employee rights, no proof of an antiunion motivation is needed and the Board can find an unfair labor practice even if the employer introduces evidence that the conduct was motivated by business considerations. Second, if the adverse effect of the discriminatory conduct on employee rights is “comparatively slight,” an anti-union moti- vation must be proved to sustain the charge if the employer has come forward with evidence of legiti- mate and substantial business justifications for the conduct. Thus, in either situation, once it has been proved that the employer engaged in discriminatory conduct which could have adversely affected employee rights to some extent, the burden is upon the employer to establish that he was motivated by legitimate objectives since proof of motivation is most accessible to him.

Applying the principles to this case then, it is not necessary for us to decide the degree to which the chal- lenged conduct might have affected employee rights. As the Court of Appeals correctly noted, the company came forward with no evidence of legitimate motives for its discriminatory conduct. 363 F.2d at 134. The company simply did not meet the burden of proof, and the Court of Appeals misconstrued the function of judicial review when it proceeded nonetheless to spec- ulate upon what might have motivated the company. Since discriminatory conduct carrying a potential for adverse effect upon employee rights was proved and




Union security clauses contained in collective bargaining contracts have been a source of tension between those who object to joining and supporting unions and the union adherents, who assert that it is a fundamental necessity that the unions be able to generate the economic resources through periodic dues to provide appro- priate representation. Right-to-work laws prohibit certain union security agree- ments in certain states.


Sections 8(a)(3) and 8(b)(2) authorize the parties to collective bargaining agree- ments to enter into agreements by which employees working under such agree- ments, as a condition of continued employment, are required to maintain membership in a union. This is a so-called union shop clause or agreement. Under the NLRA, employees subject to a union shop agreement must be allowed a mini- mum of 30 days to join a union. Section 8(f) provides an exception to the 30-day requirement, permitting the enforcement of a seven-day union shop agreement in the construction industry because of the occasional nature of work in that industry.

The union shop agreement permitted by Section 8(a)(3) does not require full union membership, but only dues-paying membership. Thus, a union can compel an employer to terminate an employee for failure to be a member of the union only when the employee is unwilling to meet the initiation fee and union dues required of all employees working under the collective bargaining agreement. The rationale for the dues-paying requirement of the Act is that all employees who receive the benefits of a union’s representation of the employees in contract negotiations and contract administration, including the costs of arbitration of grie- vances, should share in the costs of such services.42 Nonmembers should not be allowed to “free ride” on the dues paid by union members.

Much less commonly used than the union shop form of union security agree- ment is the agency shop agreement, which requires all unit employees, both union

no evidence of a proper motivation appeared in the record, the Board’s conclusions were supported by substantial evidence, Universal Camera Corp. v. Labor Board, 340 U.S. 474 (1951), and should have been sustained.

The judgment of the Court of Appeals is reversed and the case is remanded with directions to enforce the Board’s order.

It is so ordered.

Case Questions

1. What issue was the Supreme Court called upon to resolve?

2. What are the controlling principles set forth by the Supreme Court concerning the significance of employer motivation in the context of an alleged Section 8(a)(3) violation?

3. What was the holding of the case?

42 See Buckley v. Television & Radio Artists, 496 F.2d 305 (2d Cir. 1974).


and nonunion, to pay a representation or agency fee, or union dues, as a condition of employment.

A problem exists, however, with union or agency shop agreements under which all employees must pay the union representation fees, in that unions expend some funds for activities that are not related to collective bargaining. In Communication Workers of America v. Beck,43 the Supreme Court determined that collective bargaining agreements negotiated in the private sector are unlawful to the extent that nonunion employees must pay fees for union representation, which include the financing of activities other than the negotiation and administration of the collective bargaining agreement, and the nonunion employees object to the financing of such activities. In NLRB v. Studio Transportation Drivers Local 399, presented in this section, the Teamsters Union was found to have committed a Section 8(b)(1)(a) unfair labor practice in its method of calclating Beck objector’s dues.

In its California Saw and Knife Works44 decision, the Board ruled in a series of consolidated cases that (1) unions must timely inform newly hired nonmembers of their Beck rights, and such notice may be provided in a union newspaper if reason- able perusal would alert nonmembers of the Beck policy; (2) unions may not insist that nonmember objections be sent to the union by registered mail; (3) unions need not calculate agency fee reductions on a unit-by-unit basis and may include as a fee for union representation litigation expenses, including expenses external to a unit that may ultimately inure to the benefit of unit employees; and (4) unions may con- solidate arbitration hearings regarding challenges to dues reduction calculations and may require challengers to bear the cost of their travel expenses for such hearings.

In UFCW Locals 951, 7, and 1036 v. NLRB,45 certain individuals employed by Meijer, Inc., a food retailer, asserted their Beck rights and objected to paying for the organizing costs expended by the union in attempting to organize other food retailers. Citing California Saw, the Board majority found that organizing expenditures were properly charged to objectors because there is a direct, positive relationship between wage levels of union-represented employees and the level of organization of employees of employers in the same competitive market. The deci- sion was enforced by the Ninth Circuit Court of Appeals.46

In PWU, Local 707 v. NLRB, the court held that a union is in violation of its duty of fair representation if it seeks the discharge of employees for nonpayment of dues without first informing the employees of their Beck and California Saw rights

43 487 U.S. 735 (1988). 44 320 NLRB 224 (1995). 45 307 F.3d 760 (9th Cir. 2002). 46 In Pirlott v. NLRB, 522 F.3d 423 (D.C. Cir. 2008), the D.C. Court of Appeals granted the Board’s application for enforcement of Board findings that Teamsters Local 75 failed to show that its organiz- ing activities were permissible expenditures under Beck for objecting nonmembers David and Sherry Pirlott, employees of Schreiber Foods in Green Bay, Wisconsin. The Board found that the testimony before the ALJ amounted to a literature review that supported the general proposition that organizing will allow unions to raise wages more than they otherwise would, but such was not sufficient evidence to meet its burden of proof under Meijer.


that they have the right to remain nonmembers of the union and that as nonmem- bers, they have “the right (1) to object to paying for union activities not germane to the union’s duties as bargaining agent and to obtain a reduction in fees for such activities; (2) to be given sufficient information to enable the employee to intelli- gently decide whether to object; and (3) to be apprised of any internal union proce- dures for filing objections.”47


Section 14(b) of the NLRA permits states that have passed so-called right-to-work laws to prohibit union shop and agency shop agreements. Some 23 states, primar- ily in the South and West, have enacted such laws.48

Unions are philosophically opposed to right-to-work laws because they allow all employees (both union and nonunion) to receive the benefits derived from the continuing negotiations of collective bargaining contracts and their administration, including the right to representation by a union in the processing of grievances, which nonunion employees do not pay for through union dues or an agency fee. They are free riders, according to the unions’ viewpoint.

Unions have attacked the validity of right-to-work laws on various fronts. The Retail Clerks Local 1625 v. Schermerhorn case disposed of the union’s preemption claim raised on reargument.49 The Supreme Court held that although most labor disputes are within the exclusive jurisdictional province of federal agencies and courts, Congress, in granting the states the power to prohibit certain union security devices, also extended to them the authority to enforce that prohibition. The Supreme Court has also rejected various claims based on the constitutional guaran- tees of free speech, due process, and freedom to contract. Right-to-work legislation is an area of obvious and continuing importance in the labor field.

In Lord v. Local 2088 IBEW,50 the Eleventh Circuit Court of Appeals held that a union shop provision in a collective bargaining agreement applicable to employees working at federal enclaves in Florida was legal under the NLRA. It was thus enforceable against employees, even though the provision was prohibited under Florida’s right-to-work law.

47 PWU, Local 707 v. NLRB, 161 F.3d 1047 (7th Cir. 1998). 48 The following states have passed right-to-work laws: Alabama, Arizona, Arkansas, Florida, Georgia, Idaho, Indiana Iowa, Kansas, Louisiana, Mississippi, Nebraska, Nevada, North Carolina, North Dakota, Oklahoma, South Carolina, South Dakota, Tennessee, Texas, Utah, Virginia, and Wyoming. On September 25, 2001, Oklahoma became the 22nd state with a right-to-work law, which was approved by voters on that date. The state’s governor touted it as an economic development tool, stat- ing, “As of today, Oklahoma is open for business. Passage of Right-to-Work is just the latest in a series of reforms and changes designed to make Oklahoma the most attractive business destination in America.” Perceiving economic development advantages, some 14 states had right-to-work bills intro- duced in their state legislatures in 2011. On February 1, 2012 Indiana became the 23rd state to adopt a right-to-work law.Proponents contended that this law will help Indiana capture much needed jobs; opponents asserted that there was no proof that the change will lead to job growth, and claimed it will hurt unions and lower wages. 49 375 U.S. 96 (1963). 50 646 F.2d 1057 (11th Cir. 1981).



Under Section 8(a)(4), an employer may not “discharge or otherwise discriminate against an employee because he has filed charges or given testimony under this act.” This provision protects employees from discharge, layoff, or other working- conditions discrimination for testifying or making out a charge or an affidavit in


[Hyo Choi Lim is employed by a subsidiary of Uni- versal Studios. Local 399’s collective bargaining agreement includes a union security clause. Union security clauses require all employees to become members of the union within a certain period of time after being hired. Lim notified the union that he was asserting his rights as a Beck objector. Under that decision, employees who work under col- lective bargaining agreements with union security clauses can refuse to join the union as long as they agree to pay their fair share of representational expenses. The union conceded Lim’s right to refuse to join the union under Beck, but informed him that his fair share of representational expenses would be 99.6 percent of dues owed by union members. Lim challenged the union’s decision to use “liquidated damages” obtained in the sum of $26,705 from arbi- tration awards payable to the union to fund nonrep- resentational expenses such as political and charitable donations. From the Board’s determination that the union had violated the NLRA, it appealed to the Court of Appeals to enforce its order.]

PREGERSON, C. J.… In Communications Workers of America v. Beck, the Supreme Court held that “§ 8(a)(3) permits an employer and a union to enter into an agreement requiring all employees to become union members as a condition of continued employment, but the ‘mem- bership’ that may be so required has been ‘whittled down to its financial core.’”… Beck held that § 8(a) (3) “authorizes the exaction of only those fees and dues necessary to ‘performing the duties of an exclu- sive representative of the employees in dealing with the employer on labor-management issues.’”… The fees and dues exacted for performing representational duties are sometimes called “fair share” fees, because they represent the fair and reasonable cost of providing

representational services to each employee represented by the union, whether such employee is a Beck objec- tor or full-fledged union member. Beck objectors are thus not required to pay for expenses that are not germane to representation, such as political or charitable donations….

… The “liquidated damages” in this case were derived from arbitration that had been funded partially by Beck objectors like Lim. Therefore, the Board held that the union could not offset these “liquidated damages” from its nonrepresentational expenses.

The Board’s interpretation is rational and consis- tent with the Act. Whenever a union’s representa- tional expenses generate secondary income—be it interest and dividend income in Chevron Chemical Co. or “liquidated damages” in this case—the union could use those funds for representational expenses, which would in turn lower the dues required of full union members and Beck objectors alike. Therefore, in choosing to spend the secondary income on politi- cal and charitable contributions rather than on repre- sentational expenses, the union is essentially increasing the dues required of Beck objectors in order to pay for these contributions. That is exactly what the Supreme Court prohibited in Beck.

[Order enforced. Granted.]

Case Questions

1. State the union membership requirement under Section 8(a)(3) of the NLRA as interpreted by the Supreme Court’s Beck decision.

2. What did the Court find wrong with the union spending funds, which it had lawfully been awarded in arbitration proceedings, on political candidates supportive of union ideals and on charitable contributions for the good of the community?


any NLRB proceedings. It applies to laid-off employees and applicants for open jobs if they are refused employment due to appearing at an NLRB hearing. Discharging an employee or discriminating against an employee or applicant for testifying, filing a charge, or refusing to withdraw charges has been found to be a Section 8(a)(4) violation.51

In Alamo Rent-a-Car, the employer questioned an employee about whether he had any knowledge about allegations in an NLRB complaint. The employee stated that he knew nothing about it and signed a statement to that effect. Later, he testi- fied at the unfair labor practice hearing in detail regarding the complaint, and thereafter he was discharged for lying to the employer. The Board found that he was discharged for his testimony before the ALJ, not for lying, and that the discharge was in violation of Section 8(a)(4).52


The extent of this duty of an employer to bargain is set forth in the NLRA. The employer must bargain over so-called mandatory subjects of bargaining and need not bargain over so-called permissive subjects of bargaining. A wide range of ques- tions on employers’ obligations to bargain have been considered by the Supreme Court and are developed as follows.


Section 1 of the NLRA declares the policy of the United States to protect commerce “by encouraging the practice and procedure of collective bargaining and by protecting the exercise by workers of full freedom of association, self-organization, and designation of representatives of their own choosing, for the purpose of negoti- ating the terms and conditions of their employment.” To effect this policy, Section 8(a)(5) provides that it is an unfair labor practice for an employer “to refuse to bargain collectively with the representatives of his employees subject to the provisions of Section 9(a).” Section 8(d) defines “to bargain collectively” as “the performance of the mutual obligation of the employer and the representative of the employees to meet at reasonable times and confer in good faith with respect to wages, hours, and other terms and conditions of employment.” Section 9(a) declares: “Representatives designated or selected for the purposes of collective bar- gaining by the majority of the employees in a unit appropriate for such purposes, shall be the exclusive representatives of all the employees in such unit for the purpose of collective bargaining in respect to rates of pay, wages, hours of employ- ment, or other conditions of employment.”

Together these provisions establish the obligation of the employer to bargain collectively “with respect to wages, hours, and other terms and conditions of employment” with “the representatives of his employees” designated or selected by the majority “in a unit appropriate for such purposes.”

51 See NLRB v. Scrivener, 405 U.S. 117 (1972); Caterpillar, Inc., 322 NLRB 674 (1996). 52 336 NLRB 1155 (2001).


The procedural requirements are partly defined by Section 8(d), including the following duties: (1) to meet at reasonable times and confer in good faith; (2) to execute a written contract if agreement is reached but without legal compulsion on either party to agree or to make any concessions; (3) for termination or modifica- tion of an existing contract, to give a 60-day notice to the other party with an offer to confer for negotiating proposals and a 30-day notice to federal and state mediation services of a pending dispute over the new agreement; and (4) to have no strikes or lockouts during the 60-day notice period, subject to loss of employee status for so striking.


In NLRB v. Wooster Division of the Borg-Warner Corp.,53 the Supreme Court approved a distinction between mandatory and permissive subjects of bargaining. The duty to bargain imposed by Sections 8(a)(5) and 8(b)(3), the Court held, is lim- ited to the subjects delineated in Section 9(a): “rates of pay, wages, hours of employment, or other conditions of employment.” As to these items, classified as mandatory unless a party has waived its rights by previous agreement, the parties must bargain. The decision on what subjects are mandatory within the classifica- tion of Section 9(a) is made by the Board and the courts.

Some obvious examples of the meaning of the term wages are basic hourly rates of pay, piece rates, shift differentials, incentive plans, severance pay, and paid holidays and vacations. Bonuses are considered mandatory subjects when they are compensation for services rendered but not when they are given as a gift. Profit-sharing plans and stock purchase plans are also considered mandatory sub- jects. In the Southern Nuclear Operating Co. v. NLRB decision, presented in this section, future retirement benefits of current employees were determined to be mandatory subjects of bargaining as part of current employees’ overall compensa- tion packages.

The case law over “hours” has crystallized to the point that controversy in this area is almost nonexistent. Almost every issue related to hours of employment is now considered a mandatory subject of bargaining.

Several items under the phrase “terms and conditions of employment” have con- sistently been considered mandatory subjects of bargaining. These include seniority provisions, promotions, layoff and recall provisions, no-strike-no-lockout clauses, grievance procedures, and work rules. In Brewers and Malters, Local No. 6, IBT v. NLRB,54 the D.C. Circuit Court of Appeals affirmed a Board decision that installing hidden surveillance cameras in work and break areas without first bargaining with the union is a violation of Section 8(a)(5). Although such is a “term and condition of employment” and a mandatory subject of bargaining, the decision does not prevent an employer from using hidden surveillance cameras after bargaining over the issue. That is, after the employer bargains over the proposal and the reasons for it, it need not apprise the union of the exact location or the time the cameras will be used.

53 356 U.S. 342 (1958). 54 414 F.3d 36 (D.C. Cir. 2005).


Subcontracting, business closings, and relocating bargaining unit work are three areas of controversy. In the Fibreboard decision, presented in this section, the Supreme Court ruled that a decision to subcontract work was a mandatory subject of bargaining. The Court limited its holding to the type of subcontracting in that case, which involved the replacement of employees in an existing bargaining unit with those of an independent contractor.55 Thus, a ready-mix concrete com- pany violated Section 8(a)(5) by selling its trucks to owner-operators and utilizing these independent contractors to perform the delivery work formerly performed by its employees, when it failed to bargain to impasse on the matter.56

In the Supreme Court’s First National Maintenance Corp. decision, presented in this section, the Court announced a balancing test regarding an employer’s duty to bar- gain over an economically motivated decision to close down part of its business. While the Court held that the union did not have a right to participate in the decision-making process on the question of whether to shut down part of the business, the Court held that the union did have a right to bargain over the effects of the decision.

In the NLRB’s Dubuque Packing Co.57 decision, the Board announced its test for determining whether an employer has a mandatory obligation to bargain over the relocation of bargaining unit work. The test requires the following:

1. The burden is initially on the General Counsel to establish that the employer’s decision involved a relocation of work unaccompanied by a basic change in the nature of the employer’s operation.

2. If so established, a prima facie case is made that the relocation decision is a mandatory subject of bargaining.

3. The burden shifts to the employer at this point, and the employer has two alternative defenses:

a. The employer may produce evidence rebutting the prima facie case by establishing that the work performed at the new location varies signifi- cantly from the work performed at the former plant, (1) establishing that the work performed at the former plant is to be discontinued entirely and not moved to the new location or (2) establishing that the employer’s decision involves a change in the scope and direction of the enterprise.

b. Alternatively, the employer may proffer a defense to show by a prepon- derance of the evidence that (1) labor costs (direct and/or indirect) were not a factor in the decision or (2) even if labor costs were a factor in the decision, the union could not have offered labor cost concessions that could have changed the employer’s decision to relocate.

55 See NLRB v. Wehr Constructors, Inc., 159 F.3d 946 (6th Cir. 1998), in which the Sixth Circuit refused to follow the Fibreboard precedent because the work subcontracted after union certification had not previously been performed by the existing union employees and no evidence was presented that the employer’s continuation of its previously lawful subcontracting caused the employer to replace any existing employees. 56 Naperville Ready Mix, Inc., v. NLRB, 242 F.3d 744 (7th Cir. 2001). 57 303 NLRB No. 66 (1991).



Those subjects that the Board and the courts have held not mandatory are classi- fied as “permissive.” If a subject is permissive, refusal to bargain over it does not violate Sections 8(a)(5) or (b)(3). When a permissive subject is included in a collec- tive bargaining agreement, it is not transformed into a mandatory subject. There- fore, a party has no obligation to bargain over a permissive subject, despite the fact that past contracts contained a provision dealing with that subject.

Thus, where the Board has defined a bargaining unit, the unit may be altered by agreements of the parties, but a party may not seek the modification or exclu- sion of certain employees to the point of impasse.58 The parties may agree upon an interest arbitration clause, but neither party may insist on its inclusion to the point of impasse.59 Also, when an employer demands that charges against it before the NLRB be withdrawn as a precondition to contract negotiations, such is a Section 8(a)(5) unfair labor practice because the employer has caused an impasse over a permissive subject of bargaining.60 Internal union affairs, required use of union labels, indemnification clauses, performance bonds, and union recognition clauses are considered permissive subjects of bargaining. In Allied Chemical Work- ers Local 1 v. Pittsburgh Plate Glass Co.,61 the Supreme Court held that benefits of already retired employees were not mandatory subjects of bargaining and that an employer’s unilateral modification of a contract term did not breach its duty to bargain when that modification related to a permissive rather than a mandatory subject of bargaining. In an interesting sidelight to an antitrust suit in Robertson v. National Basketball Association,62 the district court held that the player draft, the reserve clause, and merger or noncompetition agreements are permissive, rather than mandatory, subjects of bargaining. It is important to note, however, that in the private sector, the Board and the courts are more inclined to find a subject mandatory and tend to classify subjects as permissive only when they are clearly beyond the scope of Section 9(a). Moreover, astute employers and unions tend to bargain for benefits that help hire, retain, and advance qualified workers regardless of the subject matter. For example, where an immigrant workforce is utilized, parties have negotiated that the employer would begin to offer English language classes, forklift instruction, and other educational opportunities to help workers in their job advancement.


The question of good faith bargaining arises in many ways, one aspect being employer unilateral action on mandatory bargaining subjects without good faith negotiations with employee representatives. It also may involve an employer

58 Canterbury Gardens, 238 NLRB 864 (1978). 59 Columbus Pressmen, 219 NLRB 268 (1975). 60 Stackpole Components Co., 232 NLRB 723 (1977). 61 404 U.S. 157 (1971). 62 389 F. Supp. 867 (S.D.N.Y. 1975).


communicating directly with employees as to its bargaining position. The Board held in the General Electric63 case that presenting to union negotiators an insurance pro- posal and other proposals as rigid “fair-and-firm” offers or on a “take-it-or-leave-it” basis is illegal. Also illegal is attempting to bypass national negotiators by directly dealing with local unions. General Electric’s collective bargaining policy, called Boulwarism for the company vice president who formulated the bargaining concept of a fair-and-firm offer that would be subject to change only if new information showed the company wrong, was thus held to be an unfair labor practice. The Board found this technique “calculated to disparage the union and to impose, without sub- stantial alteration, respondent’s fair and firm proposal, rather than to satisfy the true standards and good faith collective bargaining required by the statute.”

As a general rule, bypassing a union and dealing directly with employees so as to undermine a certified bargaining agent is unlawful. In the C & C Plywood64 decision, the Supreme Court upheld a Board determination that an employer’s inauguration of a premium pay plan during the term of a collective bargaining agreement, without prior consultation with the union, violated Section 8(a)(5).

OBLIGATION TO FURNISH INFORMATION. Disclosure of relevant information is an integral part of the bargaining process. Both employers—and, when relevant, unions—have a duty to furnish adequate information on bargaining topics upon request. The duty is intertwined with the duty to bargain in good faith.

In NLRB v. Truitt Manufacturing Co., the Supreme Court stated that “good- faith bargaining necessarily requires that claims made by either party should be honest claims,” and if an inability-to-pay argument “is important enough to pres- ent in the give and take of bargaining, it is important enough to require some sort of proof of its accuracy.”65 The Board and the courts thus require that employers claiming financial inability to pay are obligated to substantiate the claim on request. Uncertainty sometimes exists when an employer “poor-mouths” the eco- nomic climate or asserts that the business is “fighting for its life,” and it is difficult to ascertain whether the employer is actually claiming inability to pay, thus trigger- ing the Truitt disclosure obligation. In AMF Trucking & Warehouse, Inc., the Board defined “ability to pay” to mean that the company presently has insufficient assets to pay or that it would have insufficient assets to pay during the life of the contract that is being negotiated. The Board concluded in AMF Trucking that the employer’s repeated statements that it was “fighting for its life” did not meet the standard because the employer neither claimed insufficient assets nor asserted that the union’s demand would cause it to go out of business.66 In addition to inability-to-pay information, job classification wage data (within the unit or outside if comparable); and time-study data and the right to make independent check studies are additional examples of the broad obligation of the employer to furnish

63 General Electric Co., 150 NLRB 192 (1965), enforced, 418 F.2d 736 (2nd Cir. 1969). 64 NLRB v. C&C Plywood, 385 U.S. 421 (1967). 65 351 U.S. 149, 153 (1956). 66 342 NLRB No. 116(2004).


information. An unwillingness to cooperate in these areas may result in a finding of employer refusal to bargain and a cease-and-desist order.

SURFACE BARGAINING. Surface bargaining—appearing to negotiate while intending to avoid reaching a contract—violates Section 8(a)(5) of the Act. In NLRB v. Hardesty Co.,67 the Eighth Circuit Court of Appeals upheld the Board’s decision that Hardesty Co., a ready-mix concrete distributor, engaged in surface bargaining as part of a plan to seek a decertification election as soon as the protected one-year certification period ended. While Section 8(d) specifically provides that the obliga- tion to bargain in good faith does not compel either party to agree to a proposal or require the making of a concession, a party cannot negotiate with the intent to avoid reaching a contract. When the behavior of the company was examined at the bargaining table as well as away from the table, the Section 8(a)(5) violation became evident. The Court stated:

The record shows that the parties easily reached agreement on a number of issues and that the negotiations proceeded smoothly for several months until Hardesty withdrew some of its initial proposals and thereafter introduced regressive proposals, proposing the elimination of overtime (which averaged ten hours per week, per employee in the unit), bonuses, and the 401(k) plan. Of itself, such hard-bargaining might not amount to a Section 8(a)(5) violation. However, in this case, the Board found that the explana- tion for Hardesty’s bargaining positions were not to be found in the Company’s some- what perfunctory statements. Rather, the explanation for the Company’s course of conduct was provided by the Company’s away-from-the-table behavior, consisting mostly of statements by supervisors concerning the Company’s preferred method of dealing with the Union. Given the evidence of record, we cannot say that the Board erred in concluding that Hardesty had no intention of reaching an agreement, that its plan was to wait until a decertification vote might be had in order to get rid of the Union.68


There often comes a time in the process of negotiating a collective bargaining con- tract that the parties’ talks reach a stalemate and further bargaining would be futile. When these irreconcilable differences are reached after full, good faith nego- tiations, the law recognizes the existence of a bargaining impasse. The existence of an impasse is very much a question of fact. For examples, there was no impasse when an employer determined to change the wage structure immediately upon expiration of the contract, or when the employer declared an impasse after only three meetings.

Absent clearly expressed consent by a union, an employer violates Section 8(a)(5) by changing a term or condition of employment without first bargaining to impasse with a union. For example, Aramark Educational Services violated the NLRA when it unilaterally implemented a new, strict “Social Security no-match” policy of suspending

67 308 F.3d 859 (8th Cir. 2002). 68 Id. at 866.


employees with uncorrected discrepancies in their social security numbers prior to any discussion and impasse in bargaining with UNITE HERE Local 26.69

Upon an overall bargaining impasse, the employer may unilaterally implement its bargaining proposals. However, the changes must not be substantially different from or greater than any offers that the employer proposed during negotiations. Even given the employer’s right to unilaterally implement changes upon impasse, a union is not totally defenseless at this point, for it has the strike weapon in its arsenal, as the parties strive to break the impasse. Moreover, the existence of a genuine impasse may be challenged before the Board, if the union charges the non- existence of a true impasse.


[After receiving union proposals for contract revi- sions for the benefit of the maintenance workers at the company’s Emeryville, California, plant, the com- pany advised the union that negotiations for a new contract would be pointless because it had definitely decided to contract out the work performed by the employees covered by the agreement upon the expira- tion of the agreement. The company planned to replace these employees with an independent contrac- tor’s employees and expected that substantial savings would be effected by this contracting-out of the work. The Board ordered the company to reinstate the maintenance operation with the union employees, reinstate the employees with back pay, and fulfill its statutory bargaining obligation. The court of appeals granted the Board’s enforcement petition, and the Supreme Court agreed to hear the case.]

WARREN, C. J.… I. Section 8(a)(5) of the National Labor Relations Act provides that it shall be an unfair labor practice for an employer “to refuse to bargain collectively with the representatives of his employees.” Collective bar- gaining is defined in Section 8(d) as

the performance of the mutual obligation of the employer and the representative of the

employees to meet at reasonable times and confer in good faith with respect to wages, hours, and other terms and conditions of employment.

“Read together, these provisions establish the obli- gation of the employer and the representative of its employees to bargain with each other in good faith with respect to ‘wages, hours, and other terms and conditions of employment….’ The duty is limited to those subjects, and within that area neither is legally obligated to yield. Labor Board v. American Ins. Co., 343 U.S. 395. As to other matters, however, each party is free to bargain or not to bargain….” Labor Board v. Wooster Div. of Borg-Warner Corp., 356 U.S. 342, 349. Because of the limited grant of certiorari, we are concerned here only with whether the subject upon which the employer allegedly refused to bargain— contracting out of plant maintenance work previously performed by employees in the bargaining unit, which the employees were capable of continuing to perform—is covered by the phrase “terms and condi- tions of employment” within the meaning of Section 8(d).

The subject matter of the present dispute is well within the literal meaning of the phrase “terms and conditions of employment.”…


69 Aramark Educational Servicers Inc., 335 NLRB No. 011, Case 1-CA-43486 (Feb. 18, 2010).


… As the Court of Appeals pointed out,

it is not necessary that it be likely or probable that the union will yield or supply a feasible solution but rather that the union be afforded an opportunity to meet management’s legitimate complaints that its maintenance was unduly costly.

We are thus not expanding the scope of manda- tory bargaining to hold, as we do now, that the type of “contracting out” involved in this case—the replacement of employees in the existing bargaining unit with those of an independent contractor to do the same work under similar conditions of

employment—is a statutory subject of collective bar- gaining under Section 8(d). Our decision need not and does not encompass other forms of “contracting out” or “subcontracting” which arise daily in our complex economy….

The judgment of the Court of Appeals is affirmed.

Case Questions

1. What company action caused this complaint? 2. What remedy did the Board order? 3. With this decision, did the Supreme Court

expand the scope of mandatory bargaining to include all subcontracting situations?


[Petitioner, First National Maintenance Corporation (FNM), supplies its customers a contracted-for labor force and supervision in return for reimbursement of its labor costs plus a management fee. FNM termi- nated a part of its business, that of performing main- tenance work at the Greenpark Care Center, a nursing home in Brooklyn, New York, solely for eco- nomic reasons, and the 35 FNM employees working there were discharged. The NLRB held that FNM had a duty to bargain under Sections 8(a)(5) and 8(d) with the certified representative of its employees over the decision to close a part of its business, the maintenance operation at the Greenpark Care Center, and the court of appeals enforced the Board’s order.]

BLACKMUN, J.… The Court of Appeals’ decision in this case appears to be at odds with decisions of other Courts of Appeals, some of which decline to require bargain- ing over any management decision involving “a major commitment of capital investment” or a “basic operational change” in the scope or direction of an enterprise, and some of which indicate that bargaining is not mandated unless a violation of § 8(a)(3) (a partial closing motivated by antiunion animus) is involved….

Because of the importance of the issue and the continuing disagreement between and among the Board and the Courts of Appeals, we granted certiorari.

… The present case concerns a … type of manage- ment decision, one that had a direct impact on employment, since jobs were inexorably eliminated by the termination, but had as its focus only the eco- nomic profitability of the contract with Greenpark, a concern under these facts wholly apart from the employment relationship. This decision, involving a change in the scope and direction of the enterprise, is akin to the decision whether to be in business at all, “not in [itself] primarily about conditions of employment though the effect of the decision may be necessarily to terminate employment.” Cf. Textile Workers v. Darlington Co., 380 U.S. 263 (1965) (“an employer has the absolute right to terminate his entire business for any reason he pleases”). At the same time, this decision touches on a matter of central and pressing concern to the union and its member employees: the possibility of continued employment and the retention of the employees’ very jobs.

Petitioner contends it had no duty to bargain about its decision to terminate its operations at Greenpark. This contention requires that we



determine whether the decision itself should be con- sidered part of petitioner’s retained freedom to man- age its affairs unrelated to employment.* … Management must be free from the constraints of the bargaining process to the extent essential for the running of a profitable business. It also must have some degree of certainty beforehand as to when it may proceed to reach decisions without fear of later evaluations labeling its conduct an unfair labor prac- tice. Congress did not explicitly state what issues of mutual concern to union and management it intended to exclude from mandatory bargaining. Nonetheless, in view of an employer’s need for unencumbered deci- sion making, bargaining over management decisions that have a substantial impact on the continued avail- ability of employment should be required only if the benefit, for labor-management relations and the col- lective bargaining process, outweighs the burden placed on the conduct of the business….

Both union and management regard control of the decision to shut down an operation with the utmost seriousness. As has been noted, however, the Act is not intended to serve either party’s individual interest, but to foster in a neutral manner a system in which the conflict between these interests may be resolved. It seems particularly important, therefore, to consider whether requiring bargaining over this sort of deci- sion will advance the neutral purposes of the Act.

A union’s interest in participating in the decision to close a particular facility or part of an employer’s operations springs from its legitimate concern over job security. The Court has observed: “The words of [§ 8(d)] … plainly cover termination of employ- ment which … necessarily results” from closing an operation. The union’s practical purpose in partici- pating, however, will be largely uniform; it will seek to delay or halt the closing. No doubt it will be impelled, in seeking these ends, to offer concessions, information, and alternatives that might be helpful to management or forestall or prevent the termination of jobs. It is unlikely, however, that requiring bargaining over the decision itself, as well as its effects, will aug- ment this flow of information and suggestions. There is no dispute that the union must be given a signifi- cant opportunity to bargain about these matters of

job security as part of the “effects” bargaining man- dated by § 8(a)(5). And, under § 8(a)(5), bargaining over the effects of a decision must be conducted in a meaningful manner and at a meaningful time, and the Board may impose sanctions to ensure its adequacy. A union, by pursuing such bargaining rights, may achieve valuable concessions from an employer engaged in a partial closing. It also may secure in contract negotiations provisions implementing rights to notice, information, and fair bargaining.

Moreover, the union’s legitimate interest in fair dealing is protected by § 8(a)(3), which prohibits par- tial closings motivated by antiunion animus, when done to gain an unfair advantage. Textile Workers v. Darlington Co., 380 U.S. 263, 58 LRRM 2657 (1965). Under § 8(a)(3) the Board may inquire into the motivations behind a partial closing. An employer may not simply shut down part of its business and mask its desire to weaken and circumvent the union by labeling its decision “purely economic.”

Thus, although the union has a natural concern that a partial closing decision not be hastily or unnec- essarily entered into, it has some control over the effects of the decision and indirectly may ensure that the decision itself is deliberately considered. It also has direct protection against a partial closing decision that is motivated by an intent to harm a union.

Management’s interest in whether it should discuss a decision of this kind is much more complex and var- ies with the particular circumstances. If labor costs are an important factor in a failing operation and the deci- sion to close, management will have an incentive to confer voluntarily with the union to seek concessions that may make continuing the business profitable. At other times, management may have great need for speed, flexibility, and secrecy in meeting business opportunities and exigencies. It may face significant tax or securities consequences that hinge on confidenti- ality, the timing of a plant closing, or a reorganization of the corporate structure. The publicity incident to the normal process of bargaining may injure the possibility of a successful transition or increase the economic damage to the business. The employer also may have no feasible alternative to the closing, and even good faith bargaining over it may be both futile and cause the employer additional loss.

There is an important difference, also, between permitted bargaining and mandated bargaining. Labeling this type of decision mandatory could afford a union a powerful tool for achieving delay, a power that might be used to thwart management’s intentions


* There is no doubt that petitioner was under a duty to bargain about the results or effects of its decision to stop the work at Greenpark, or that it violated that duty. Petitioner consented to enforcement of the Board’s order concerning bargaining over the effects of the closing and has reached agreement with the union on severance pay.


in a manner unrelated to any feasible solution the union might propose….

We conclude that the harm likely to be done to an employer’s need to operate freely in deciding whether to shut down part of its business purely for economic reasons outweighs the incremental benefit that might be gained through the union’s participation in mak- ing the decision, and we hold that the decision itself is not part of § 8(d)’s “terms and conditions,” over which Congress has mandated bargaining.

The judgment of the Court of Appeals, accord- ingly, is reversed and the case is remanded to that court for further proceedings consistent with this opinion.

It is so ordered.

JUSTICE BRENNAN, with whom JUSTICE MARSHALL joins, Dissenting … The Court bases its decision on a balancing test. It states that “bargaining over management decisions that have a substantial impact on the continued availability of employment should be required only if the benefit, for labor-management relations and the collective bargaining process, outweighs the burden placed on the conduct of the business.” I cannot agree with this test, because it takes into account only the interests of manage- ment; it fails to consider the legitimate employment interests of the workers and their Union. This one- sided approach hardly serves “to foster in a neu- tral manner” a system for resolution of these seri- ous, two-sided controversies.

Apparently, the Court concludes that the benefit to labor-managment relations and the collective bargaining process from negotiation over partial

closings is minimal, but it provides no evidence to that effect. The Court acknowledges that the Union might be able to offer concessions, information, and alternatives that might obviate or forestall the closing, but it then asserts that “[i]t is unlikely, however, that requiring bargaining over the decision … will aug- ment this flow of information and suggestions.” Recent experience, however, suggests the contrary. Most conspicuous, perhaps, were the negotiations between Chrysler Corporation and the United Auto Workers, which led to significant adjustments in com- pensation and benefits, contributing to Chrysler’s ability to remain afloat. Even where labor costs are not the direct cause of a company’s financial difficul- ties, employee concessions can often enable the com- pany to continue in operation—if the employees have the opportunity to offer such concessions….

Case Questions

1. Why did the Supreme Court decide to hear the case?

2. State the test the Court applied in determining whether the partial closing was a mandatory subject of bargaining.

3. Did the Court conclude that the partial closing was a mandatory subject of bargaining?

4. Under the FNM decision, may an employer shut down part of its business in order to weaken a union’s position at the employer’s other opera- tions by labeling the decision as “purely economic”?

5. Did FNM have a mandatory obligation to bar- gain about the “effects” of its decision to stop work at Greenpark?


[In 2000, four subsidiaries of the Southern Company made modifications to the health care and life insur- ance benefits of their future retirees without negotiat- ing with their employees’ unions. The unions filed

unfair labor practice charges against these subsidiar- ies, and the National Labor Relations Board deter- mined that the subsidiaries violated Sections 8(a)(1) and 8(a)(5) of the National Labor Relations Act by



making the changes without bargaining collectively. The subsidiaries petitioned for review, and the Board cross-applied for enforcement of its order.]

GRIFFITH, C. J.… The Companies ask us to set aside the Board’s con- clusion that they were required to bargain collectively before making the 2000 changes. We first consider the Companies’ argument that the NLRA left them free to make the changes unilaterally.

Section 8(a)(5) of the NLRA makes it an unfair labor practice for an employer to “refuse to bargain collectively with the representatives of his employees.” 29 U.S.C. § 158(a)(5). Section 8(d) requires employers to bargain collectively before introducing changes “with respect to wages, hours, and other terms and conditions of employment.” Id. § 158(d). An employer violates Section 8(a)(5) by making any unilateral changes to the mandatory bargaining subjects covered by Section 8(d), NLRB v. Katz, 369 U.S. 736, 743 (1962). The Companies argue that their unilateral changes to the OPRBs [Other Post-Retirement Benefits] were permissible because the future retirement benefits of current employees are not mandatory bargaining subjects under Section 8(d). We are not persuaded.

The governing principle is found in Allied Chemi- cal & Alkali Workers of America, Local Union No. 1 v. Pittsburgh Plate Glass Co., 404 U.S. 157 (1971). In that case, the Supreme Court held that retirement benefits for workers who have already retired are not mandatory bargaining subjects because retirees are not “employees” under the NLRA and are there- fore not protected by the Act. See id. at 168 (“The ordinary meaning of ‘employee’ does not include retired workers; retired employees have ceased to work for another for hire.”) But the Court also made clear that retirement benefits for current employees are mandatory bargaining subjects: “To be sure, the future retirement benefits of active work- ers are part and parcel of their overall compensation and hence a well-established statutory subject of bargaining.” Id. at 180. Because the 2000 modifica- tions affected future retirement benefits of current employees, the Companies were required to bargain over them with the unions.

The Companies argue that the statement in Pitts- burgh Plate Glass about future retirement benefits is a dictum and should not supply a rule of decision in this case. We have more faith than do the Companies in Supreme Court declarations that begin with “To be sure….” See United States v. Oakar, 111 F.3d 146, 153 (D.C. Cir. 1997) (stating that “carefully consid- ered language of the Supreme Court, even if techni- cally dictum, generally must be treated as authoritative”) (quotation marks omitted). But even if the question were an open one, the Companies’ argument fails because “classifications of bargaining subjects as ‘terms [and] conditions’ of employment is a matter concerning which the Board has special expertise.” Local Union No. 189, Amalgamated Meat Cutters & Butcher Workmen of N. Am. v. Jewel Tea Co., 381 U.S. 676, 685–86 (1965); see also Ford Motor Co. v. NLRB, 441 U.S. 488, 497 (1979) (“Construing and applying the duty to bar- gain … [lies] at the heart of the Board’s function.”). The Board has decided that future retirement benefits fit in Section 8(d)’s basket of mandatory bargaining subjects. This decision, particularly in light of the Board’s expertise, is rational and therefore lawful. See id. at 495 (noting that the Board’s “judgment as to what is a mandatory bargaining subject is entitled to considerable deference”). No one could doubt that current employees are rightly concerned about the retirement benefits that they will receive in the future. Giving them the right to bargain collectively over those benefits is certainly sensible….

[The Board’s order is enforced in relevant parts.]

Case Questions

1. Does an employer violate the NLRA by making a unilateral change in a “mandatory” subject of bargaining?

2. Did the employer’s modification to the health care and life insurance benefits of future retirees without input from the unions constitute unilat- eral changes in mandatory subjects of bargaining?

3. Find an example of a “permissive” subject of bargaining in the Court’s opinion.



It is common under our economic system for businesses to merge or be acquired by other businesses. The manner in which the changes in business ownership take place is varied and often indirect and complex. There may be an outright sale of a business operation, with the new employer continuing to employ the same employees at the same plant. The new employer may hire many new employees while continuing to employ some of the predecessor’s employees. The new employer may acquire the assets of the plant or business but change the operation of the business. The union representing the predecessor’s employees may believe that the new owner is a “successor” employer with an obligation to bargain with the union. The new owner may believe that it is not a successor and that it has no legal obligations to the predecessor’s union and employees.

In NLRB v. Burns International Security Services, Inc.,70 the Supreme Court stated that a mere change of employers or ownership in the employing industry does not affect the Board’s certification of a bargaining unit. The successor’s obligation to bargain is based on the language of Sections 8(a)(5) and 9(a) of the NLRA—an employer must bargain with the “representatives designated or selected for the purposes of collectively bargaining by the majority of the employees in a unit appropriate for such purposes.” In Burns, the Supreme Court approved the rule that a mere change in ownership does not destroy the presumption of continu- ing employee support for a certified union.71


In determining whether a new employer must recognize a union that has repre- sented the predecessor’s employees, the NLRB looks to the totality of the circum- stances to determine whether there have been changes that have significantly altered the employees’ working conditions, expectations, and needs for representa- tion. Factors considered by the Board in determining whether a new employer is obligated to recognize a union are the following:

1. Continuity of the workforce: A majority of the employees must have worked for the predecessor employer for the union to succeed. If the new owner purposefully avoids hiring union members to escape designation as a Burns successor, the majority requirement is waived, and the employer will ordinarily be subject to a bargaining order.72

2. Continuity of operations: The Board looks to the continuity of the functions performed by the employees, the continuation of the business at the same location with the same or similar equipment, and the continuity of customers.

70 406 U.S. 272, 279 (1972). 71 Id. at 277–79. See also Aircraft Magnesium, 265 NLRB 1344, 1345 (1982). 72 Hudson River Aggregates, Inc., 246 NLRB 192 (1979); Potter’s Drug Enterprises, 233 NLRB 15 (1977).


3. Continuity of the appropriateness of the unit: The bargaining unit of the new employer must continue to be appropriate for a successorship finding.

4. Hiatus: A hiatus between the cessation of production of the old employer and the commencement of the new employer’s operations will be considered by the Board. However, it does not preclude a successorship finding where the hiatus period is viewed as the normal concomitant of a new management and a new approach to a failing business.

5. Employer defenses: The new employer may avoid the successorship obliga- tions to recognize and bargain with a union where the continuity and hiatus factors do not support a finding of successorship. The new employer may also avoid these obligations if it has not committed unfair labor practices and demonstrates a bona fide doubt as to the union’s lack of majority support.73


The obligation of a new employer to negotiate the initial terms and conditions of employment depends on whether the new employer is an ordinary successor or a “perfectly clear successor.” A new employer is generally free to set the initial terms of employment for the employees of a predecessor, without bargaining with the incumbent union.74 However, where it is “perfectly clear” that the new employer intends to retain the unionized employees of its predecessor as a majority of its own workforce under essentially the same terms as their former employment, then the new employer becomes a “perfectly clear successor” and must bargain with the union about the initial terms of employment.

In Dupont Dow Elastomers, LLC v. NLRB,75 the Sixth Circuit Court of Appeals ruled that a joint venture between E.I. du Pont de Nemours & Co. and Dow Chemical Co. was a “perfectly clear successor” of the parent companies and was therefore required to bargain with the union involved before setting initial terms and conditions of employment. The successor joint venture wanted to retain the trained workers who manufactured synthetic rubber products, and its commu- nications with the predecessor employees were crafted to ensure that it would not lose these experienced workers to other employers. The joint venture offered employment to these workers, 97 percent of whom accepted. It then, without bargaining with the union, changed classifications, overtime policy, and the

73 In its MV Transportation decision, 337 NLRB 770 (2002), the Board decided that an incumbent union in a successorship situation was entitled to a rebuttable presumption of continuing majority sta- tus, which would not serve as a bar to an otherwise valid decertification, rival union, or employer peti- tion or other valid challenge to the union’s majority status. In UGL-UNICO Service Co., 357 NLRB No. 76 (August 26, 2011) the Board overturned its MV Transportation precedent, and returned to its “successor bar doctrine.” This doctrine set forth in the Board’s St. Elizabeth Manor Inc. decision, 329 NLRB 341 (1999), allows an incumbent union to maintain its status as a representative of employees for a “reasonable period” after the successor employer’s takeover before the Board can process a decertification petition or a petition from a rival union. 74 NLRB v. Burns International Security Service, Inc., 406 U.S. 272, 298–99 (1972). 75 296 F.3d 495 (6th Cir. 2002).


severance program. This action was found to be a Section 8(a)(5) refusal-to-bargain unfair labor practice.

In some situations, a new employer may be ordered to abide by the terms of the predecessor’s collective bargaining agreement. A new employer is under no obligation to hire a predecessor’s employees. However, when it is determined that a successor employer discriminates against hiring predecessor employees because of their union membership, and thereby seeks to avoid dealing with a union, the employer loses its right to set initial terms and conditions of employment, and it may be ordered to rescind any changes in those terms and compensate employees for losses, so as to put them in a position they would have been in but for the successors’ unlawful conduct.76

A successor employer is distinguished from an “alter ego” employer. An entity is an alter ego of another discontinued entity when it is “merely a disguised contin- uance of the old employer.” In alter ego cases, the Board determines whether there is a continuation of ownership and control of the new enterprise by the former owner, stating it will find alter ego status “where the two enterprises have substan- tially identical management, business purpose, operations, equipment, customers, and supervision, as well as ownership.”77 The alter ego employer is bound by the terms of the predecessor’s collective bargaining agreement.


The bargaining obligation can normally be determined at the time of the transac- tion or when operations of the new employer begin. However, when a new employer is reopening a shutdown plant or is operating at a substantially reduced capacity, a delay in making the determination may be appropriate until, as the Supreme Court stated in Burns, “the successor employer has hired his full comple- ment of employees.”78 This “full-complement” principle, however, has not been interpreted to require that the bargaining obligation determination be postponed until the business is operating at its maximum capacity or until the employer has completed hiring all of its bargaining unit employees. The Board has held, and the courts have agreed, that in cases in which the successorship obligation cannot be determined at the very outset of the transaction, fixing the appropriate date at which the bargaining obligation arises “involves balancing the objective of ensuring maximum employee participation in the selection of a bargaining agent against the goal of permitting employees to be represented as quickly as possible.”79 Accord- ingly, a “substantial and representative complement” standard is applied in such situations, as set forth in the Fall River Dyeing & Finishing Corp. v. NLRB decision, portions of which follow.

76 U.S. Marine Corp. v. NLRB, 944 F.2d 1305 (7th Cir. 1991). 77 Crawford Door Sales Co., 226 NLRB 1144, 94 LRRM 1393 (1976). 78 NLRB v. Burns, 406 U.S. at 295. 79 NLRB v. Pre-Engineered Building Products, 603 F.2d 134, 136 (10th Cir. 1979). See also Premium Foods, Inc. v. NLRB, 709 F.2d 623 (9th Cir. 1983).



[For more than 30 years, Sterlingwale, which was owned by the Ansin family, operated a textile dyeing and finishing plant at Fall River, Massachusetts. In early 1982, Sterlingwale ran out of cash and, as a result, began to liquidate the company. It laid off employees and sold part of its inventory. In July 1982, the firm’s remaining assets were sold by a pro- fessional liquidator, and Arthur Friedman, the presi- dent of Fall River Dyeing, acquired Sterlingwale’s equipment and real property through another Fried- man company. On September 20, 1982, Fall River began hiring employees at the former Sterlingwale premises. On October 19, the union demanded recog- nition from the new employer. At that time, 18 of the 21 individuals employed by Fall River Dyeing were former Sterlingwale employees. By January 15, 1983, the first shift at Fall River was in full operation, with 36 of the 55 employees hired being former Ster- lingwale employees. By April 15, 1983, the workforce had expanded to 107 employees, with 52 being for- mer Sterlingwale employees. The Board held that as of January 15, 1983, the company employed a sub- stantial and representative complement of employees and that Fall River was a successor employer to Ster- lingwale. It held that Fall River had violated Sections 8(a)(5) and (1) of the NLRA by refusing to recognize and bargain with the union once its successoral obli- gation arose. The Court of Appeals for the First Cir- cuit enforced the Board’s order, and the Supreme Court granted certiorari.]

BLACKMUN, J.… Fifteen years ago in NLRB v. Burns International Security Services, Inc., 406 U.S. 272 (1972), this Court first dealt with the issue of a successor employ- er’s obligation to bargain with a union that had represented the employees of its predecessor. In Burns, about four months before the employer tran- sition, the security guard employees of Wackenhut Corp. had chosen a particular union as their bargain- ing representative and that union had negotiated a collective bargaining agreement with Wackenhut. Wackenhut, however, lost its service contract on cer- tain airport property to Burns. Burns proceeded to hire 27 of the Wackenhut guards for its 42-guard operation at the airport. Burns told its guards that,

as a condition of their employment, they must join the union with which Burns already had collective bargaining agreements at other locations. When the union that had represented the Wackenhut employees brought unfair labor practice charges against Burns, this Court agreed with the Board’s determination that Burns had an obligation to bargain with this union….

… We cited with approval, Board and Court of Appeals decisions where it “ha[d] been consistently held that a mere change of employers or of ownership in the employing industry is not such an ‘unusual circumstance’ as to affect the force of the Board’s certification within the normal operative period if a majority of employees after the change of ownership or management were employed by the preceding employer.” Id., at 279….

In addition to recognizing the traditional presump- tions of union majority status, however, the Court in Burns was careful to safeguard “‘the rightful preroga- tive of owners independently to rearrange their business.’” Golden State Bottling Co. v. NLRB, 414 U.S. 168, 182 (1973), quoting John Wiley & Sons, Inc. v. Livingston, 376 U.S. 543, 549 (1964). We observed in Burns that, although the successor has an obligation to bargain with the union, it “is ordi- narily free to set initial terms on which it will hire the employees of a predecessor,” 406 U.S., at 294, and it is not bound by the substantive provisions of the pre- decessor’s collective bargaining agreement. Id., at 284. We further explained that the successor is under no obligation to hire the employees of its pre- decessor, subject, of course, to the restriction that it not discriminate against union employees in its hiring. Id., at 280, and n. 5; see also Howard Johnson Co. v. Hotel Employees, 417 U.S. 249, 262, and n. 8 (1974). Thus, to a substantial extent the applicability of Burns rests in the hands of the successor. If the new employer makes a conscious decision to main- tain generally the same business and to hire a major- ity of its employees from the predecessor, then the bargaining obligation of § 8(a)(5) is activated. This makes sense when one considers that the employer intends to take advantage of the trained workforce of its predecessor.

Accordingly, in Burns we acknowledged the inter- est of the successor in its freedom to structure its



business and the interest of the employees in contin- ued representation by the union. We now hold that a successor’s obligation to bargain is not limited to a situation where the union in question has been recently certified. Where, as here, the union has a rebuttable presumption of majority status, this status continues despite the change in employers. And the new employer has an obligation to bargain with that union so long as the new employer is in fact a successor of the old employer and the majority of its employees were employed by its predecessor….

A. In Burns we approved the approach taken by the Board and accepted by courts with respect to deter- mining whether a new company was indeed the suc- cessor to the old. 406 U.S., at 280–281, and n. 4. This approach, which is primarily factual in nature and is based upon the totality of the circumstances of a given situation, requires that the Board focus on whether the new company has “acquired substan- tial assets of its predecessor and continued, without interruption or substantial change, the predecessor’s business operations.” Golden State Bottling Co. v. NLRB, 414 U.S., at 184. Hence, the focus is on whether there is “substantial continuity” between the enterprises. Under this approach, the Board exam- ines a number of factors: whether the business of both employers is essentially the same; whether the employees of the new company are doing the same jobs in the same working conditions under the same supervisors; and whether the new entity has the same production process, produces the same pro- ducts, and basically has the same body of customers….

Although petitioner does not challenge the Board’s “substantial continuity” approach, it does contest the application of the rule to the facts of this case. Essen- tially for the reasons given by the Court of Appeals, 775 F.2d, at 430, however, we find that the Board’s determination that there was “substantial continuity” between Sterlingwale and petitioner and that peti- tioner was Sterlingwale’s successor is supported by substantial evidence in the record. Petitioner acquired most of Sterlingwale’s real property, its machinery and equipment, and much of its inventory and mate- rials. It introduced no new product line. Of particular significance is the fact that, from the perspective of the employees, their jobs did not change. Although petitioner abandoned converting dyeing in exclusive favor of commission dyeing, this change did not alter the essential nature of the employees’ jobs,

because both types of dyeing involved the same pro- duction process. The job classifications of petitioner were the same as those of Sterlingwale; petitioner’s employees worked on the same machines under the direction of supervisors, most of whom were former supervisors of Sterlingwale. The record, in fact, is clear the petitioner acquired Sterlingwale’s assets with the express purpose of taking advantage of its predecessor’s workforce.

We do not find determinative of the successorship question the fact that there was a 7-month hiatus between Sterlingwale’s demise and petitioner’s start- up. Petitioner argues that this hiatus, coupled with the fact that its employees were hired through newspaper advertisements—not through Sterlingwale employment records, which were not transferred to it—resolves in its favor the “substantial continuity” question. Yet such a hiatus is only one factor in the “substantial continuity” calculus and thus is relevant only when there are other indicia of discontinuity. Conversely, if other factors indicate a continuity between the enterprises, and the hiatus is a normal start-up period, the “totality of the circumstances” will suggest that these circumstances present a successorship situation.

For the reasons given above, this is a case where the other factors suggested “substantial continuity” between the companies despite the 7-month hiatus. Here, moreover, the extent of the hiatus between the demise of Sterlingwale and the start-up of petitioner is somewhat less than certain. After the February layoff, Sterlingwale retained a skeleton crew of supervisors and employees that continued to ship goods to customers and to maintain the plant. In addition, until the assignment for the benefit of the creditors late in the summer, Ansin was seeking to resurrect the business or to find a buyer for Sterling- wale. The Union was aware of these efforts. Viewed from the employees’ perspective, therefore, the hia- tus may have been much less than seven months. Although petitioner hired the employees through advertisements, it often relied on recommendations from supervisors, themselves formerly employed by Sterlingwale, and intended the advertisements to reach the former Sterlingwale workforce.

Accordingly, we hold that, under settled law, peti- tioner was a successor to Sterlingwale. We thus must consider if and when petitioner’s duty to bargain arose.

B. In Burns, the Court determined that the successor had an obligation to bargain with the union because



a majority of its employees had been employed by Wackenhut. The “triggering” fact for the bargaining obligation was this composition of the successor’s workforce. The Court, however, did not have to con- sider the question when the successor’s obligation to bargain arose: Wackenhut’s contract expired on June 30 and Burns began its services with a majority of former Wackenhut guards on July 1. In other situations, as in the present case, there is a start-up period by the new employer while it gradually builds its operations and hires employees. In these situa- tions, the Board, with the approval of the Courts of Appeals, has adopted the “substantial and represen- tative complement” rule for fixing the moment when the determination as to the composition of the successor’s workforce is to be made. If, at this partic- ular moment, a majority of the successor’s employees had been employed by its predecessor, then the successor has an obligation to bargain with the union that represented these employees.

This rule represents an effort to balance “‘the objective of ensuring maximum employee participa- tion in the selection of a bargaining agent against the goal of permitting employees to be represented as quickly as possible.’” 775 F.2d, at 430–431, quoting NLRB v. Pre-Engineered Building Products, Inc., 603 F.2d 134, 136 (CA10 1979). In deciding when a “substantial and representative complement” exists in a particular employer transition, the Board examines a number of factors. It studies “whether the job classifications designated for the operation were filled or substantially filled and whether the operation was in normal or substantially normal production.” See Premium Foods, Inc., v. NLRB, 709 F.2d 623, 628 (CA9 1983). In addition, it takes into consideration “the size of the complement on that date and the time expected to elapse before a substantially larger complement would be at work … as well as the relative certainty of the employer’s expected expansion.” Ibid.

Petitioner contends that the Board’s representa- tive complement rule is unreasonable, given that it injures the representation rights of many of the suc- cessor’s employees and that it places significant bur- dens upon the successor, which is unsure whether and when the bargaining obligation will arise. According to petitioner, if majority status is deter- mined at the “full complement” stage, all the employees will have a voice in the selection of their bargaining representative, and this will reveal if the union truly has the support of most of the successor’s

employees. This approach, however, focuses only on the interest in having a bargaining representative selected by the majority of the employees. It fails to take into account the significant interest of employ- ees in being represented as soon as possible. The lat- ter interest is especially heightened in a situation where many of the successor’s employees, who were formerly represented by a union, find themselves after the employer transition in essentially the same enterprise, but without their bargaining representative. Having the new employer refuse to bargain with the chosen representative of these employees “disrupts the employees’ morale, deters their organizational activities, and discourages their membership in unions.” Franks Bros. Co. v. NLRB, 321 U.S. 702, 704 (1944). Accordingly, petitioner’s “full complement” proposal must fail….

We conclude, however, that in this situation the successor is in the best position to follow a rule the criteria of which are straightforward. The employer generally will know with tolerable certainty when all its job classifications have been filled or substantially filled, when it has hired a majority of the employees it intends to hire, and when it has begun normal pro- duction. Moreover, the “full complement” standard advocated by petitioner is not necessarily easier for a successor to apply than is the “substantial and repre- sentative complement.” In fact, given the expansion- ist dreams of many new entrepreneurs, it might well be more difficult for a successor to identify the moment when the “full complement” has been attained, which is when the business will reach the limits of the new employer’s initial hopes, than it would be for this same employer to acknowledge the time when its business has begun normal produc- tion—the moment identified by the “substantial and representative complement” rule.

We therefore hold that the Board’s “substantial and representative complement” rule is reasonable in the successorship context….

C. We also hold that the Board’s “continuing demand” rule is reasonable in the successorship situation. The successor’s duty to bargain at the “substantial and representative complement” date is triggered only when the union has made a bargaining demand. Under the “continuing demand” rule, when a union has made a premature demand that has been rejected by the employer, this demand remains in force until the moment when the employer attains the




The Bankruptcy Code provides a statutory procedure whereby a financially troubled business debtor may petition the bankruptcy court for “reorganization.”80 Under Chapter 11 of the Bankruptcy Code, a rehabilitation plan is filed with the courts. Creditors’ acceptance of the plan is then sought, and ultimately a plan is approved or confirmed by the court. The business debtor usually remains in possession of the business and its assets after filing a Chapter 11 petition and thus is referred to as a debtor in possession. The purpose of a Chapter 11 petition is to financially rehabilitate the business.

The Supreme Court’s NLRB v. Bildisco and Bildisco, Debtor in Possession,81

decision dealt with the issues that arise after a business files for reorganization

“substantial and representative complement.” See, e.g., Aircraft Magnesium, 265 N.L.R.B., at 1345, n. 9; Spruce Up Corp., 209 N.L.R.B., at 197….

The judgment of the Court of Appeals is affirmed. It is so ordered.

POWELL, J., joined by C. J. BURGER and J. O’CONNOR, dissenting … … The Court acknowledges that when petitioner completed the employment of its anticipated work- force in April 1983, less than 50 percent of its employees formerly had worked for Sterlingwale. It nevertheless finds that the new company violated its duty to bargain, because at an earlier date chosen by the Board, a majority of the workforce formerly had worked for Sterlingwale. The NLRB concluded that even though petitioner was still in the process of hir- ing employees, by the middle of January it had hired a “substantial and representative complement,” when its first shift was adequately staffed and most job categories had been filled….

… [U]nless the delay or uncertainty of future expan- sion would frustrate the employees’ legitimate interest in early representation—a situation not shown to exist

here—there is every reason to wait until the full antici- pated workforce has been employed….

… The decision today “balances” these interests by over-protecting the latter and ignoring the former. In an effort to ensure that some employees will not be deprived of representation for even a short time, the Court requires petitioner to recognize a union that has never been elected or accepted by a majority of its workers….

Case Questions

1. Is a successor under an obligation to hire the employees of its predecessor?

2. Did the fact that there was a seven-month hiatus between the shutdown of Sterlingwale and the start-up of Fall River demonstrate that Fall River was not a successor?

3. At what point in time does the Board determine whether a new employer’s workforce is made up of a majority of employees of the predecessor?

4. When did the dissenting Justices believe the majority status should have been determined?

80 The foundation of the current law of bankruptcy is the Bankruptcy Reform Act of 1978, 11 U.S.C. § 101 et seq. (2005), BAPCPA commonly referred to as the “Bankruptcy Code.” The Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 (BAPCPA), Pub. L. No. 109-8, 119 Stat. 23, modifies the provisions of the code governing individual bankruptcies, affects financially distressed small businesses, and establishes a comprehensive procedural framework to manage transnational insolvencies. The BAPCPA did not, however, modify the law relating to labor contracts. 81 465 U.S. 513 (1984).


under Chapter 11 of the Bankruptcy Code. May a business—the debtor in possession—be permitted to reject a collective bargaining agreement without dem- onstrating that its reorganization will fail unless rejection of the labor contract is permitted? The Supreme Court did not approve such a strict standard for rejection of a labor contract by a bankruptcy court. Instead, the Court held that a collective bargaining agreement may be rejected if “the debtor can show that the collective bargaining agreement burdens the estate, and [if] after careful scrutiny the equities balance in favor of rejecting the labor contract.” May a debtor in possession uni- laterally modify or terminate its labor contracts when a Chapter 11 petition is filed, or must it wait until the bankruptcy court approves its motion to reject the labor contract? The Bildisco Court held that the debtor in possession could unilat- erally terminate or reject a labor contract, after filing a petition in bankruptcy, before formal rejection is approved by the bankruptcy court. This action was found not to be in violation of Sections 8(a)(5) and (d) of the NLRA. However, the Court set forth bargaining requirements before the debtor could petition the court for rejection and also noted the debtor’s obligation to bargain over the terms and conditions of a possible new contract.

The Bankruptcy Amendments and Federal Judges Act of 1984 overturned the part of the Bildisco decision that allowed for the unilateral rejection of a collective bargaining contract before approval by a bankruptcy court. The 1984 Act added certain other requirements for rejection of labor contracts. It requires bankruptcy court approval of “necessary” contract modifications before the debtor in posses- sion (employer in bankruptcy) can reject the contract. Three provisions of the Act are of particular importance:

1. Section 1113(b)(1) provides that prior to filing an application for rejection of a contract, the debtor must make a proposal to the union “which provides for those necessary modifications in the employees’ benefits and protections that are necessary to permit the reorganization of the debtor and assures that all creditors, the debtor and all of the affected parties are treated fairly and equitably.” The language “assures that all creditors, the debtor and all of the affected parties are treated fairly and equitably” was added to the Act because Congressman Morrison of Connecticut pointed to a Chapter 11 proceeding in which the Wilson Food Co. unilaterally rejected its labor contract. Bargaining unit employees absorbed a 25 percent pay cut, while all creditors received 100 cents on the dollar. Congressman Morrison expressed the belief that employees should not be asked to make greater financial sacrifices than other creditors, and after debate, the language was added to the Act.

2. The court can approve the application for rejection only after bargaining on the proposal required by Section 1113(b)(1) and, under Section 1113(c)(2), only after it is demonstrated at a court hearing that the union refuses to accept such a proposal “without good cause.”

3. When the requirements of Sections 1113(b)(1) and (c)(2) are met, the court will then apply “the balance of the equities” standard applied in Bildisco, with the additional requirement that the balance of the equities “clearly” favor rejection of the labor contract. If so found by the court, the court will approve the application for rejection or modification of the labor contract.


The terrorist attacks on September 11, 2001, have had a severe impact on the air- line industry. Most major U.S. airlines have restructured their costs through the bank- ruptcy process in conformity with Sections 1113(b) and 1113(c), with the parties themselves ultimately reaching agreements on labor cost reductions, allowing the carrier involved to be cost-competitive with low-cost and previously restructured airlines.82

In Wheeling-Pittsburgh Steel Corp., Debtor in Possession v. Steelworkers,83 the Third Circuit Court of Appeals set forth the meaning of the term necessary as used in Section 1113(b)(1) of the Bankruptcy Code. Because the 1984 legislation con- tained no definition of the word necessary, the Third Circuit relied on the legislative history to give meaning to the term. The study of the legislative history showed that the language of Section 1113(b)(1) was based on Senator Robert Packwood’s amendment. Senator Packwood noted, concerning the amendment, that

only modifications which are necessary to a successful reorganization may be proposed. Therefore, the debtor will not be available to exploit the bankruptcy procedure to rid itself of unwanted features of the labor agreement that have no relation to its financial condition and its reorganization and which earlier were agreed to by the debtor. The word “necessary” inserted twice into this provision clearly emphasizes this required aspect of the proposal which the debtor must offer and guarantees the sincerity of the debtor’s good faith in seeking contract changes.84

The court in Wheeling-Pittsburgh held that the reasons given by the bankruptcy court in concluding that the debtor’s proposal was “necessary” and “fair and equita- ble” were not persuasive. The bankruptcy court “failed to give any persuasive ratio- nale for the disproportionate treatment of the employees who were being asked to take a five-year agreement under a worse-case scenario without any possibility for restoration or share in the event of a better than anticipated recovery.”

In Truck Driver’s Local 807 v. Carey,85 the Second Circuit Court of Appeals utilized a different standard than the “minimum modifications” language of Sena- tor Packwood’s amendment, stating:

In sum, we conclude that the necessity requirement places on the debtor the burden of proving that its proposal is made in good faith, and that it contains necessary, but not absolutely minimal, changes that will enable the debtor to complete the reorganization process successfully.

The Second Circuit’s “necessary” requirement focuses on the long-term goal of the debtor’s successful reorganization as opposed to the short-term horizon of the Third Circuit’s reading of the “necessary” requirement with its minimum modifica- tions that would permit reorganization.86

82 See “Airlines” DLR No. 220 (Nov. 16, 2005); but see “Airlines” DLR No. 237 (Dec. 12, 2005). For an article on American Airlines’ 2012 bankruptcy see DLR No. 21 (Feb. 1, 2012). 83 791 F.2d 1074 (3d Cir. 1986). 84 130 Cong. Rec. § 8898 (daily ed. June 29, 1984). 85 816 F.2d 82, 90 (2d Cir. 1987). 86 See in re American Provision Co., 44 B.R. 907, 909 (1984), and in re Horizon Natural Resources Co., 316 B.R. 268 (2004), for prerequisites for determining whether a collective bargaining agreement should be rejected.



1. The UAW (union) filed a representation petition on May 15, 2000, to represent some 650 production workers at Stanadyne Automobile Corporation’s plant in Windsor, Connecticut, and the Board scheduled the election for June 29, 2000. Before the elec- tion, the employer had no rule prohibiting employees from talking about any topic they chose during working hours. After the peti- tion was filed, supervisors informed employees that the employees were not allowed to discuss the union or solicit union support during working hours and that violations could result in being disciplined or fired.

On June 6, CEO William Gurley deliv- ered a prepared speech to groups of employees in which he stated in part:

It has come to my attention that some union supporters, not all, but some are har- assing fellow employees…. Harassment of any type is not tolerated by this company and will be dealt with.

The union lost the election and filed unfair labor practice charges against the employer. The employer admits that the supervisors should not have told employees that they were not allowed to discuss the union or solicit support during working hours, and it does not challenge a finding that this activity was a violation of rights protected by Section 7 of the NLRA. The employer insists, however, that CEO Gurley had a right to promulgate the no-harassment rule on June 6 and this rule could not be construed to prohibit protected activity. The union disagrees. Decide. [UAW v. NLRB, 520 F.3d 102 (2d Cir. 2008)]

2. The management of Bill Johnson’s Restau- rants, doing business as The Big Apple Restaurant, informed the employees of new restrictions regarding the employees’ use of the company phone, the procedure for calling in sick, and the chewing of gum at

work. During a later discussion in front of a supervisor, one of the employees, Mrs. Helton, suggested that the servers needed a union. The following day, Mrs. Helton, a senior employee, was fired because a company vice president “didn’t like her attitude.” In response to the firing, several employees petitioned the NLRB to institute an unfair labor practice action against the restaurant. Several employees also picketed in front of the restaurant without obstruct- ing the parking lot or entrances. The pick- eters urged the public to boycott the business, and they also distributed leaflets to that effect. Sherry Sturgeon, a manager, told the picketers that they were not funny and she would “have the last laugh.” The man- agement then filed a civil action in state court for business interference, trespass, and libel. The complaint sought $500,000 in damages and an injunction.

When the NLRB decided the Helton discharge case, it also ordered the restaurant to withdraw its state court action. The NLRB ruled that the suit was an intrusion upon the Board’s jurisdiction and constituted a unfair labor practice. The restaurant refused to comply with the Board’s order and appealed.

What factors must be considered when deciding whether the state lawsuit may be pursued? What was the result in this case? Decide. [Bill Johnson’s Restaurants v. NLRB, 108 LRRM 3044 (9th Cir.); 461 U.S. 731. But see BE & K Construction Co. v. NLRB, 536 U.S. 516 (2002), on remand, 351 NLRB No. 29, (2007)]

3. The United Transportation Workers went on strike after their contract expired with Safe- way Trails Bus Company. The company submitted to the union a new proposal for ratification. John Lantz, the union’s chief negotiator, decided that this latest proposal was very similar to the contract recently rejected by the membership and therefore


did not submit it for approval by the mem- bership. Lantz informed the company of this decision. The company thereafter mailed copies of its proposal to all employees asking each to act “in the interest of his own per- sonal welfare.” The company repeatedly sent employees letters outlining its final offer and questioning the qualifications of representa- tive Lantz. At one point, the company president offered to meet with any three employees other than Lantz to settle on a contract. The president told some striking employees they were “following the wrong man.”

The union claimed that Safeway had not bargained in good faith, in violation of Section 8(a)(5), by attempting to undermine union authority. The company denied these charges and claimed that its commu- nication with the employees was protected by Section 8(c).

Is Safeway’s conduct protected or pro- hibited under the NLRA? Decide. [Safeway Trails, Inc. v. NLRB, 102 LRRM 2328 (D.C. Cir.)]

4. Jenny Allen, a General Motors employee, was observed by a GM security guard at a bowling alley near the plant during working hours. Allen’s supervisor and the plant labor relations manager then questioned Allen on three separate occasions. During the first two interrogations, Allen, a union committee-person, never requested that a union representative accompany her, and she denied being at the bowling alley. When questioned a third time on the plant floor, Allen requested union representation. The supervisor ignored Allen’s request. Allen continued to answer questions and finally admitted that she had been at the bowling alley during working hours. Allen was dis- charged the next day.

Allen and her union claimed that Gen- eral Motors engaged in a Section 8(a)(1) unfair labor practice when it denied Allen’s request for union representation. General Motors cited Allen’s failure to request a

union representative at two previous inter- rogations and her willingness to answer questions without union representation as evidence against this charge.

Has a Section 8(a)(1) unfair labor prac- tice occurred? Decide. [General Motors Corp. v. NLRB, 109 LRRM 3345 (6th Cir.)]

5. During his tenure at Tera Advanced Services Corporation, Dan Malloy had received many warnings concerning below-average attitude and productivity, including a “final warning” and company probation in Janu- ary. After this warning, however, Malloy’s attitude and production improved so greatly that his supervisor told the operations man- ager that the warnings had been successful and no further disciplinary action was needed. On February 4, Malloy attended a company lunch where employees were allowed to ask questions of Tera’s project manager, James Long. In front of other employees, Malloy asked Long how he would feel about the formation of a union for the employees. Malloy proceeded to cite the advantages of a union. Long was visibly angered by the question and exclaimed after the lunch “who the hell does he think he is, asking to form a union at Tera.” Long then demanded to see Malloy’s personnel file, and he determined that his record was “terrible.” He decided to discharge Malloy. Long ordered a memorandum compiled outlining Malloy’s employment record. The following day Dan Malloy was discharged. Malloy claimed before the NLRB that he was dis- charged because of his question at the lunch. He claimed that asking that question was a protected activity. He believed that Tera had committed Section 8(a)(3) and (1) unfair labor practices. Tera Corporation contended Malloy would have been discharged even if he had not attended the company lunch and supported its position with the memoran- dum Long had ordered compiled.

What factors must the Board consider in deciding this case? Is there sufficient evidence of Section 8(a)(3) and (1) violations? Decide.


[Tera Advanced Services Corp., 259 NLRB No. 125, 109 LRRM 1053]

6. David Stark submitted an application to the maintenance department at Wyman-Gordon Company. Stark was a journeyman millwright with nine years’ experience at a neighboring company at the time of his application to Wyman-Gordon. Stark was vice president of the local industrial workers’ union. In his preliminary interview with the company, Ms. Peevler asked if Stark was involved in union activity, and Stark detailed his involve- ment to her. She informed Stark that Wyman- Gordon was a nonunion shop and asked how he felt about this. Ms. Peevler’s notes from the interview characterize Stark’s response to this question as “seems to lean toward third-party intervention.” Company offi- cials testified that Stark’s qualifications were “exactly what we were looking for.” Stark was not employed by the company. Stark claimed that he was discriminated against. Wyman-Gordon denied that any discrimination had occurred.

Is a job applicant (as opposed to an employee) entitled to protection from anti- union discrimination? On the facts of this case, has any discrimination taken place? Decide. [Wyman-Gordon Co. v. NLRB, 108 LRRM 2085 (1st Cir.)]

7. Hospitality Motor Inns began to bargain with the Hotel Employees Union after the NLRB certified the results of a representa- tion election. A few days prior to this elec- tion, Hospitality had promoted the leading activist of the union among the employees to a supervisory position. Hospitality refused to entertain union proposals on dues checkoffs or union security, and the company insisted upon a broad management rights clause that would permit unilateral acts by the company regarding wages and other terms of employment. Hospitality cited “philosophi- cal reasons” to justify its rejection of union proposals, including “no discrimination” and “no individual contracts” clauses in the agreement. After six months of bargaining

sessions, the company’s position did not change and no agreement was reached.

The union petitioned the Board, alleging that Hospitality Inns was bargaining in bad faith contrary to Section 8(a)(5) and (1). The company claimed that good faith bargaining does not require it to make “concessions” to the union. Decide. [NLRB v. Hospitality Motor Inns, 109 LRRM 2945 (6th Cir.)]

8. Since 1978, the International Association of Machinists, Lodge 1899, has been the certi- fied bargaining representative of certain food service employees of Marriott In-Flite Ser- vices. In 1980, without bargaining with the union, Marriott unilaterally bestowed an 11 percent wage increase and an additional holiday on these employees. Marriott con- tended that it had honestly doubted that the Machinists represented a majority of these employees since the fall of 1979, and there- fore it did not bargain with the Machinists. The Machinists alleged that the granting of wage and benefit increases without bargain- ing was a violation of Section 8(a)(5) and (1) of the NLRA. Decide. [Marriott Corp., 259 NLRB 157, 108 LRRM 1317]

9. Four days after a three-week strike, during which strike a number of employees continued to work, the union posted Jack London’s “Definition of a Scab” on the union bulletin boards on company premises. It read as follows:

Definition of a Scab

After God had finished the rattlesnake, the toad, and the vampire, he had some awful substance left with which he made a SCAB. A SCAB is a two-legged animal with a corkscrew soul, a water-logged brain, and a combination backbone made of jelly and glue. Where others have hearts, he carries a tumor of rotten principles.

When a SCAB comes down the street men turn their backs and angels weep in Heaven, and the devil shuts the gates of Hell to keep him out. No man has the right to SCAB, so long as there is a pool of water deep enough to drown his body in, or a rope


long enough to hang his carcass with. Judas Iscariot was a gentleman … compared with a SCAB; for betraying his master, he had the character to hang himself—a SCAB hasn’t.

Essau sold his birthright for a mess of porrage. Judas Iscariot sold his Saviour for thirty pieces of silver. Benedict Arnold sold his country for a promise of a commission in the British Army. The modern strikebreaker sells his birthright, his country, his wife, his children and his fellow men for an unfulfilled promise from his employer, trust or corporation.

Essau was a traitor to himself. Judas Iscariot was a traitor to his God. Benedict Arnold was a traitor to his country.

A strikebreaker is a traitor to himself, a traitor to his God, and a traitor to his coun- try, a traitor to his family and a traitor to his class.

There is Nothing Lower than a Scab.

The company ordered the postings removed from the bulletin boards under threat of disciplinary action. The company stated that it acted because the postings would create animosity among employees.

The union contended that the company violated the employees’ Section 7 rights and Section 8(a)(1) of the Act. The union con- tended that it had legitimate interest in strengthening employee support and cohe- sion for future economic strikes. The com- pany contended that the postings were beyond the protection of Sections 7 and 8(a)(1).

Which party has the burden of proof in this case? Has the Act been violated? Decide. [Southwestern Bell Tel. Co., 276 NLRB 1053, 120 LRRM 1145]

10. Local 35 of the United Food and Commer- cial Workers Union was certified by the NLRB as bargaining representative of the employees of Fountainhead Development Corporation in July. Fountainhead operated the Blu-Fountain Manor Nursing Home. Immediately after certification, the union began collective bargaining negotiations

with Fountainhead. The negotiations were not fruitful, and in October the employees began an economic strike against Fountain- head. The union filed unfair labor practice charges against Fountainhead in February relating to access to Fountainhead’s financial records. Fountainhead hired strike replacements.

On May 1, Jarm Enterprises purchased the Blu-Fountain Manor Nursing Home. Jarm immediately retracted the employee benefits package extended by Fountainhead and rehired, under new terms, all Fountain- head employees who had been working at the time of the transfer of ownership, including the striker replacements. In addi- tion, Jarm did the following: instituted new personnel policies, eliminated certain super- visory positions and job classifications, introduced a new computerized billing sys- tem, and initiated $60,000 worth of repairs to the nursing home.

On May 8, the union contacted Jarm with an unconditional offer to return to work and a request to commence collective bargaining. Jarm refused both offers, claim- ing that it was a new employer that was not subject to labor relationships established with Fountainhead. Furthermore, Jarm asserted that the union did not represent its current employees. Jarm could have rehired the striking union members because in the months following May 8, the company hired a number of employees that exceeded the number of striking employees.

The union filed an unfair labor practice charge against Jarm, claiming that the com- pany was obligated to bargain. Jarm con- tended that it was a radically different enterprise and was in no way bound to deal with the union and its strikers.

Should the union’s charge be upheld? Decide. [NLRB v. Jarm Enterprises, Inc., 121 LRRM 3105 (7th Cir.)]

11. Kathy Denaple worked in a nonsupervisory capacity at a missile component plant operated by Rockwell International. The


Communications Workers of America began a successful organizing campaign among Rockwell’s employees. Denaple supported the campaign by attending meetings and distributing authorization cards. In September, Denaple’s supervisor, Bernice Cash, asked her if she was involved with the union. When Denaple responded that it was none of Cash’s business, Cash stated that union involvement would hurt Denaple’s work record.

One morning the following January, supervisors Cash and Cheek held a meeting at which Cheek told the employees in Denaple’s department that they spent too much time in the washrooms and that the music from their radio headsets was too loud. Denaple contradicted Cheek at the meeting by stating that the music was not loud and, in fact, was softer than the sound of the wire-cutting machine in their area. Denaple also reminded the supervisors of Rockwell’s unfulfilled promise to remove the noisy machines. After this meeting, the supervisors discussed issuing Denaple a written warning for speaking out. Later that same day an employee complained that Denaple was laughing loudly and excessively at her workstation. The supervisors issued Denaple a written warning for “allowing excessive laughing to disturb a work group.”

In February, six employees were dis- charged by Rockwell after urinalysis revealed that they had used drugs. After the tests, but before the discharges, one of the tested employees had asked Denaple to find out if the union could help him if he was fired. She agreed. During the morning on which the employees were fired, Denaple was discussing the firings with a coworker when a supervisor cautioned Denaple that she was already in enough trouble and that she should return to her workstation. Dena- ple complained to the supervisor that the firings were unfair and asked if all employees would be tested. Later that day Denaple asked Cash for time off to attend to personal

business. Cash refused permission although she noted that Denaple’s attendance had improved of late. Denaple told Cash that she had to leave. The supervisor told Denaple that she would not be fired if she left, but she explicitly refused to grant Denaple’s request. Nevertheless, Denaple left the premises.

Cash shared this latest incident with the other supervisors, and they consulted Rock- well’s manager of employee relations, Wanda Saed, by phone. Saed ordered Denaple terminated. The next day Denaple was terminated for “work-related behavior and attendance.”

The union asserted that Denaple was fired because she engaged in protected activity. The employer claimed that Denaple was fired because she was an insubordinate employee with an attendance problem. Have any unfair labor practices occurred? Could the General Counsel bring a case on behalf of Denaple challenging her dismissal? Decide. [Rockwell International v. NLRB, 125 LRRM 2132 (11th Cir.)]

12. The Chrysler Corporation sold its marine engine division to the U.S. Marine Corpora- tion (USM) on January 13, 1984. USM estimated, based on data provided by its marketing and manufacturing departments, that it would need a full complement of 396 workers on the job by June 1984. USM wanted to reopen the plant as quickly as possible and needed a skilled workforce to do so. It reopened the plant under changed terms and conditions of employment, with all 219 workers being former Chrysler employees. On January 30, 1984, it hired its last Chrysler employee, with its employee totals that day being 261 employees, 227 of whom had worked for Chrysler. Thirty-four Chrysler employees were not hired, although USM’s total workforce ranged up to 323 workers through August 31, 1984. On January 25, when 222 of the 231 workers were former Chrysler employees, the union requested recognition. The request filtered up the organization, and figures on the


number of former Chrysler workers hired in the rather disorganized hiring process that took place in January were compiled; this tally indicated to top management that as of January 30, 1984, 223 Chrysler workers had been hired. On January 31, 1984, Mr. Hoag, the general manager of the USM operation, changed the full complement projection from 396 to 460 workers, increasing the produc- tion schedules for engines by some 130 engines, with no justification.

In February, the union filed charges with the Board, claiming that USM had unlaw- fully refused to bargain and had discrimi- nated against the 34 Chrysler employees it refused to hire. USM responded that it had no obligation to recognize the union because less than half of the 460 expected employees were former Chrysler employees.

Did USM have the right to change the terms and conditions of employment when it reopened the plant? Did it have an obliga- tion to recognize and bargain with the union in late January? Was the failure to hire the 34 remaining Chrysler workers after January 31 a Section 8(a)(3) violation? Decide. [U.S. Marine Corp. v. NLRB, 944 F.2d 1305 (7th Cir.)]

13. Polaroid Corporation announced the for- mation of an Employee-Owners Influence Council (EOIC) in January 1993 and invited all 8,000 employees to apply to serve on the committee. Some 150 employees applied, and the company interviewed and selected 30 employees. The company provided the facilities for the EOIC and paid all expenses to serve three-, four-, or five-year terms. A Polaroid organizational specialist con- ducted each meeting where management made proposals to the group on such topics as family and medical leave, a termination policy, medical benefits, and an employee stock ownership plan (ESOP). Polaroid con- sistently polled or otherwise questioned the group to determine the majority view of the group on the topic discussed, and this view then effectively constituted the proposal of

the EOIC, to which Polaroid thereafter responded by word or deed. For example, Polaroid’s chief executive officer Booth stated to the EOIC at the October 20 meet- ing that he would come back and discuss solutions with employees, and in fact he did come back to the EOIC with a decision. In internal publications to its workforce, Polaroid repeatedly emphasized the signifi- cant input of the EOIC on the decisions made by management. Polaroid encouraged EOIC members to communicate with other employees about issues and to report back to the EOIC the views of these employees. Mr. Booth encouraged EOIC members to tell him what other employees were expressing.

Did the employer violate Section 8(a)(2) by creating a labor organization under Section 2(5) in setting up and implementing EOIC? Or was the employer entitled to exercise its First Amendment and basic managerial rights to conduct brainstorming sessions with its employees? Decide. [Polar- oid Corp., 329 NLRB 424]

14. Tasty Baking Company (TBC) operates a plant in Philadelphia, Pennsylvania, where approximately 700 workers produce baked goods on daytime and overnight shifts. In Teamsters Union Local 115 began an orga- nizing drive among TBC employees. The union lost a representation election in April but upon the union’s objection, the board set aside the results and ordered a new election in March 1996. In mid-June, Production Operations Director Thomas Kenney demoted Edwina Flannery, the wife of well- known union activist and “oven man” Michael Flannery, from the supervisory position she had held for nearly five years. This demotion took place despite manage- ment’s recent assurances that her position was safe and that she was the company’s “newest rising star.” On August 10, 1995, after Edwina Flannery’s demotion, Superin- tendent Charles Britsch told her that the fact that her husband was outside the plant dis- tributing union literature “was not helping


[her] chances of staying on day work,” and that if he continued, she “could very seri- ously end up on night work.” She responded that he was “a grown man” and that she could not tell him what to do. Michael Flannery continued leafleting, and a month later the company transferred his wife to night shift. On January 16, 1996, Michael Flannery received a disciplinary warning from his supervisor, alleging that Flannery had twice failed to remove crumbs from the crumbs depositor. Flannery filed a written grievance, protesting that it was not his responsibility to remove the crumbs. When Flannery met with Britsch to discuss the grievance on January 18, Britsch said that the warning stemmed from the company’s new “get tough” policy. Britsch also said that he and Flannery were “enemies” and that while Flannery might think that he was doing the right thing for the employees, Britsch believed that he (Britsch) was “doing the right thing for Tasty Bake and will do whatever I have to do to keep the union out.”

On January 26, 1996, Operations Director Kenney met with an employee, William Martin, to discuss Martin’s sugges- tion that metal detectors be installed at the entrance to the workplace. Kenney told Martin that the suggestion was “stupid” and speculated that Michael Flannery was behind it. Martin denied this, and then told Kenney that Michael Flannery should not have received the “crumbs” warning because it was Martin’s, not Flannery’s, responsibil- ity to remove the crumbs from the depositor. Kenney responded that he did not care whose job it was, and “that he had told Mike that if Mike f**ked him, he would f**k Mike back.” Kenney then told Martin that, “if you f**k me, I’ll f**k you back,” and concluded: “[N]ow I’m getting Mike. I told him I was going to do it. Now I’m doing it.”

On January 31, 1996, sanitation employee Robert Nolan, another vocal

union supporter, received a three-day sus- pension and was subsequently issued a written warning for “insubordination” resulting from an incident with Linda Casey, a substitute floor monitor. According to Nolan, he had been making a telephone call during his usual break time when Casey began “yelling and screaming” at him to get off the phone. Nolan told Casey that he was talking to his wife and asked to see his reg- ular floor monitor. Casey refused to let Nolan explain or see his monitor and instructed him to get off the phone and return to work, which Nolan did. Nolan testified that thereafter, his regular monitor told him not to worry about the incident. Nonetheless, Nolan received a written warning and a three-day suspension for insubordination.

On April 11, 1996, Kenney approached Michael Flannery during his shift and said, “[I] don’t believe you. After what happened to your wife, you’re still pushing the union and calling OSHA [the Occupational Safety & Health Administration]. Are you going to make me fire you?” Two months later, on June 6, 1996, Flannery received a warning for reporting wrong “oven times” to other employees. Flannery received the warning notwithstanding that he had disputed the allegation and had been told that he would merely receive a memo to his file.

TBC contends that Britsch’s references to people “screwing up” and to the new “get tough” policy had nothing to do with union activity and contends that Kenney had never made any reference to Flannery calling OSHA. Moreover, among other points, TBC states that it demoted Edwina Flannery as part of a reorganization because she couldn’t get the job done. She received a positive performance evaluation in 1994. TBC points out that supervisors are not protected under the Act. It also states that because of her demotion, she lost seniority and was thus eligible only for night-shift work. TBC con- tends that the Board has no authority to


order Edwina reinstated as a supervisor, especially one that is on the union’s side.

From the General Counsel’s point of view, what section(s) of the NLRA would you contend were violated in this case? The company has presented its contentions regarding legitimate business reasons for its actions. Apply the Wright Line test and decide the unfair labor practices complaints. Discuss what protection, if any, Edwina Flannery is entitled to under the Act. If the Act was violated, what should be the rem- edy? [Tasty Baking Co. v. NLRB, 254 F.3d 114 (D.C. Cir. 2001)]

15. Richard Wehrli was the sole or part owner of Naperville Ready Mix, Inc., T&W Trucking, and Wehrli Equipment Co., which respectively provided ready-mix concrete, hauling services, and truck repair services for the ready-mix concrete business. During contract negotiations with Teamster Local 673, Wehrli announced that he was going to sell the delivery trucks to owner-operators. He supplied the financing for buying the trucks, required buyers to give first priority to Naperville’s hauling needs, restricted purchasers from working for competitors, sold subsidized fuel, provided truck repair services, and allowed free truck storage on site. The trucks continued to haul concrete exclusively for the employer, drivers contin- ued to receive their orders from the same dispatcher, and the owner stipulated that the purpose of the change was to lower labor costs.

Wehrli contends that the business decided, for entrepreneurial reasons, to sell substantial assets and close part of its busi- ness and that under First National Mainte- nance, his companies had no duty to bargain over this entrepreneurial decision. The com- panies recognize the obligation to bargain over the effects of the decision, and he con- tends the basic decision to close part of the business is unaffected by any decision to later engage in subcontracting, regardless of labor costs being a factor in the decision.

The General Counsel contends that Fibre- board is controlling in this case. What arguments can you make in support of the General Counsel’s position? If you were an administrative law judge, what would be your recommended decision? [Naperville Ready Mix, Inc., v. NLRB, 242 F.3d 744 (7th Cir. 2001)]

16. Cindy Adams worked as a salesperson at the nonunion Wal-Mart store in Wasilla, Alaska. On March 10, 2001, while walking to the employees’ break room for lunch, she met Ken Stanhope in the hallway, who asked about her father, a Wal-Mart employee out on workers’ compensation. She responded, and they continued to speak about her father. Stanhope then changed the subject, asking what she thought about the union, and she replied she did not want a union. Stanhope replied that her father was pro- union and urged her to check out a pro- union Internet site. According to a statement written by Cindy Adams, she asserted that Stanhope said management were “all f—ken pricks and they would f—ken lie to your face without even batting an eye. And so we needed a union to stop management and make it safe for associates.” Adams said that as Stanhope talked, he moved closer to her, and she became uncomfortable and twice moved back from him and ended the con- versation, saying she was missing out on her lunch. While the ALJ did not believe Cindy Adams’ testimony to be reliable or truthful, management acted upon her written version of events, and an investigation was con- ducted by comanagers Bruce Manderson and Marlene Munsell. On March 16, the two comanagers conducted a meeting with Stanhope, investigating the allegations of Cindy Adams against him. Stanhope imme- diately requested the presence of his own witness, which was denied, and he was ordered to sit and continue with the inter- view, and he was sent home while the man- agers continued the investigation. On March 17, after Stanhope reported for work,


accompanied by an assistant manager and with, at the manager’s request, a police offi- cer standing nearby, Manderson approached Stanhope at the food court and asked him to follow him to his office. Stanhope replied that he would not go anywhere unless he had a witness. The request was denied, and thereafter, he was terminated for creating a hostile work environment and using foul language. Manderson testified that Stan- hope’s refusal to cooperate in the investiga- tion without a witness present was a factor in the decision to discharge him. Does the

“Weingarten right” apply in this case? Did Wal-Mart commit a Section 8(a)(1) unfair labor practice by denying Stanhope’s request for a witness on March 16, 2001, and con- tinuing the interview without the presence of his requested witness? Did it violate Section 8(a)(1) by terminating Stanhope on March 17 after he refused to attend a subsequent investigatory interview without the presence of a witness? Decide. [See the ALJ’s decision to the Board’s Wal-Mart Stores, Inc., and UFCWIU, Local 343 decision, 343 NLRB No. 127.]


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6:1 Union Unfair Labor Practices

6:2 Picketing: Types and Constitutional Parameters

6:3 Mass Picketing

6:4 Union Access to Private Property

6:5 Organizational and Recognitional Picketing: Informational Picketing

6:6 Jurisdictional Disputes

6:7 Secondary Activity: “Ally” and “Common Situs” Doctrines

6:8 Secondary Activity: Consumer Product Picketing, Handbilling, and Bannering

6:9 Hot Cargo Agreements

6:10 Damages from Boycotts and Picketing


In the favorable environment provided by the Norris-LaGuardia Act and the Wagner Act, unions flourished in the period from 1935 to 1947. Union member- ship expanded from 3 million members to 15 million members during this period. Organized labor was perceived as a powerful political force during the years of World War II, with union leaders being appointed to important governmental posi- tions. With the increasing strength of labor unions, the public became more aware of the abuses of certain unions. During World War II, the United Mine Workers conducted two crippling coal strikes. These strikes were looked upon with disdain by many citizens who believed the strikes hurt the war effort. The fairness of the


closed shop, as well as the use of boycotts, was questioned. The laxity and corrup- tion in the administration of union dues, as well as certain pay for no work or featherbedding practices, were called into question by the media, academicians, and political office holders and candidates. During 1946, after the end of World War II, strikes occurred in many major industries, including the steel and auto industries. In this climate, the Taft-Hartley legislation was vigorously debated. The Taft-Hartley amendments to the NLRA were enacted on June 23, 1947, when Congress overrode President Truman’s veto. The amendments contained new restrictions on unions, including Section 8(b), which prohibited six union unfair labor practices.

The first two union unfair labor practices involving (1) the prohibition of union coercion of employees in the exercise of the right to refrain from union activ- ities, as set forth in Section 8(b)(1) of the Act; and (2) the prohibition against unions causing employers to discriminate against employees in order to discourage or encourage union membership, as set forth in Section 8(b)(2) of the Act, currently generate more than 80 percent of union unfair labor practices charges filed with the NLRB.1 Union refusal to engage in good faith bargaining, a violation of Section 8(b)(3), is not common. Employers continue to file charges for unions’ failure to engage in concessionary bargaining, but most of the time, it is in the unions’ best interest to engage in bargaining with employers. Section 8(b)(4), dealing with prohibited strikes and boycotts, contains complex subject matter that has led to clarifying legislation and much litigation. A major portion of this chapter and Chapter 7 will deal with these and related topics. Restrictions on excessive dues and initiation fees, as set forth in Section 8(b)(5), and the prohibition against feath- erbedding practices found in Section 8(b)(6) are not currently common issues before the Labor Board. Section 8(b)(7) was added to the NLRA in 1959 as part of the Landrum-Griffin Act, making it an unfair labor practice for unions to engage in extended picketing for recognitional purposes.


The first union unfair labor practice is predicated upon the Section 7 right of employ- ees to refrain from union activities as well as to participate in them. Section 8(b)(1) provides:

It shall be an unfair labor practice for a labor organization or its agents to restrain or coerce (A) employees in the exercise of the rights guaranteed in Section 7; provided that this paragraph shall not impair the right of a labor organization to prescribe its own rules with respect to the acquisition or retention of membership therein; or, (B) an employer in the selection of his representatives for the purposes of collective bargaining or the adjustment of grievances.

1 Some 6,367 cases were filed against labor organizations in the fiscal year ending September 30, 2009, as reported in the Board’s Annual Report, with 5,661 charges involving Section 8(b)(1), 535 involving Section 8(b)(2), 447 involving Section 8(b)(3), 348 involving Section 8(b)(4), 8 involving Section 8(b)(5), 24 involving Section 8(b)(6), and 33 involving Section 8(b)(7). Seventy-Fourth Annual Report of the NLRB, issued February 23, 2010.


Congressional reasoning for the inclusion of Section 8(b)(1) can clearly be determined from an extract of Senate Report 105, 80th Congress:

The committee heard many instances of union coercion of employees such as that brought about by threats of reprisal against employees and their families in the course of organizing campaigns; also, direct interference by mass picketing and other violence. Some of these acts are made illegal by state law, but we see no reason why they should not also constitute unfair labor practices to be investigated by the National Labor Relations Board, and at least deprive the violators of any protection furnished by the Wagner Act. We believe that the freedom of the individual work- man should be protected from duress by the union as well as from duress by the employer.

The legislative history of this provision indicates that Congress had no intention to prohibit the normal exercise by unions of the right to appeal to employees or members by persuasive speech or conduct that carried no threat of force or reprisal.

The prohibition of union restraint on employees’ rights contains the proviso that allows unions to prescribe their own membership rules; and such will be dealt with in detail in Chapter 9 on regulating internal union affairs. Section 8(b)(1)(A), however, has been applied to prevent union coercion to force upon employees membership or representation by a union. Threatening harm by pickets or strikers in the presence of union officials who do not repudiate them to nonstriking employees constitutes a violation of Section 8(b)(1)(A).

Under Section 8(b)(1)(B), union coercion of an employer’s rights to select its bargaining representatives is forbidden. This restriction applies to a union strike threat for insistence on bargaining with the company owners or executives rather than with an attorney engaged to negotiate for the management. It has been applied to unions striking to compel members of an employer association to sign individual agreements in conflict with an established multiemployer single unit.


Section 8(b)(2) makes it an unfair labor practice for a union “to cause or attempt to cause an employer to discriminate against an employee in violation of Section 8(a)(3) or to discriminate against an employee with respect to whom membership in such organization has been denied or terminated on some ground other than the employee’s failure to tender the periodic dues and the initiation fees uniformly required as a condition of acquiring or retaining membership.” Under the NLRA as amended in 1947, an employer is obligated to discharge an employee upon notice by the union if the following circumstances prevail:

1. A valid union shop, maintenance-of-membership, or agency shop agreement is in force.2

2 See definitions in the Glossary. Note that in all three forms of union security arrangements, the statu- tory mandates of Section 8(a)(3) and Section 8(b)(2) apply, relating only to “dues paying” or financial support requirements, and do not compel full union membership. An agency shop may be regulated or prohibited by the states under Section 14(b) in so-called right-to-work law states.


2. The employee has been denied membership in the labor association for failure to pay a reasonable initiation fee or is expelled from membership because the employee has failed to pay dues that are reasonable under Section 8(b)(5).

3. The contractual requirement of union membership is not effective before the 30th day after the date of employment or after the start of the contract period, which- ever comes later. However, under Section 8(f) of the 1959 amendments to the Act, it is not an unfair labor practice for an employer in the construction industry to make an agreement with a labor organization representing employees in that industry requiring membership after the seventh day of employment on the job.

Examples of union actions in violation of Section 8(b)(2) include forcing agree- ments on employers requiring that only those “satisfactory” to the union be hired and union-caused discharges because the employee was a “ troublemaker” or a “bad actor,” tried to organize a rival union, or was otherwise disliked by the union members. Although the right of a union to determine its own rules for membership is protected explicitly by Section 8(b), employees’ jobs or the job conditions fall outside lawful union discrimination. The Board also has found violations of Section 8(b)(1) and (2) in union discrimination for racial reasons.


The original National Labor Relations Act imposed no explicit duty upon a labor organization to engage in good faith bargaining, presumably under the theory that such a provision would be superfluous because the basic purpose of a labor associ- ation is to represent employees for purposes of collective bargaining. The amended Act, in Section 8(b)(3), imposes an affirmative duty upon unions. For example, Stanford Hospitals and SEIU Local 715 were parties to a CBA. The local merged with the United Healthcare Workers (UHW). The Stanford Hospitals sought documentation as to Local 715’s relationship with UHW, and Local 715 refused to provide the requested information. The Board determined that just as an employer has a duty to furnish information under Section 8(a)(5), a union has a parallel duty under Section 8(b)(3) to furnish relevant information to an employer necessary to fulfill its contracted obligations. The Board found that the union had violated Section 8(b)(3).3

The union duty to bargain in good faith also includes the same procedural requirements that the employer must meet, including a willingness to consider in good faith the position of the other party. Insisting on clauses that fall outside the scope of mandatory bargaining subjects constitutes a union violation of Section 8(b)(3), as the reciprocal of Section 8(a)(5).


Labor organizations that operate under permitted forms of union security may not, by virtue of Section 8(b)(5), charge excessive or discriminatory dues or initiation fees. The General Counsel of the NLRB has issued a statement that shows a

3 SEIU Local 715, 355 NLRB No. 65 (Aug. 8, 2010).


disposition to handle each charge on this issue as it arises, with the determination of unfair labor practice resting on a study of custom in the trade, the earnings made by the constituents, and the extent of protection offered to them. Thus, what might be considered excessive in one case may be entirely reasonable in another. In Television and Radio Artists (WBEN, Inc.) 4 a Section 8(b)(5) violation was found when the union raised the initiation fee from $100 to $250 in order to impede the employer from hiring part-time employees.


Featherbedding is the receiving of compensation for work that is not required by the employer or that is not tendered or performed by the employee recipients of the compensation. The work or services in question may not, in the employer’s opinion, be at all necessary but, through industry usage, may have become custom- ary. Section 8(b)(6) of the NLRA makes unlawful those attempts to cause an employer to “pay… for services which are not performed or not to be performed.” Its phrasing permits certain make-work forms of featherbedding, which would include situations in which two employees do the work that, conceiv- ably or reasonably, one worker could do. Section 8(b)(6) is inapplicable, then, when unnecessary work is performed. The test is performance and not necessity of performance, as stated by the Supreme Court in its American Newspaper Publish- ers Ass’n v. NLRB decision.5

Section 8(b)(6) must also be read along with Section 302 of the LMRA. Although Section 302(a) of the LMRA prohibits an employer from paying “any money or any other thing of value” to a union official, Section 302(c)(1) makes an exception for payments to union officials who are also employees of the employer “as compensation for, or by reason of, his service as an employee of such an employer.” In IAM, Local 964 v. BF Goodrich,6 the chief shop steward James Cifu was entitled under the parties’ collective bargaining agreement to draw his salary and benefits while working primarily on “the investigation and prosecution of union grievances.” Goodrich sought a declaratory judgment voiding the provision provid- ing pay and benefits to Cifu, arguing that such payment was in violation of Section 302(a) as money paid to a union official while conducting union business. The Ninth Circuit Court of Appeals determined that Cifu, even in his capacity as a union representative, served the company’s interests because services “rendered by union stewards benefit unions and corporations alike.” Moreover, the court sup- ported its decision based on the fact that Cifu worked from an office on the shop floor under immediate supervision of the employer, not a union hall free from corpo- rate control. Also, he carried out his work on the shop floor, where his conduct was observable and subject to the policies and norms of the employer. Accordingly, the court held that payments made to Cifu fell within the Section 302(c)(1) exception covering compensation for “services as an employee of such an employer.”

4 208 NLRB 377 (1974). But see George Banter Co. v. NLRB, 626 F.2d 354 (4th Cir. 1980). 5 345 U.S. 100 (1953). 6 387 F.3d 1046 (9th Cir. 2004).



In addition to strike activity, which will be discussed in Chapter 7, two other forms of economic pressure may be applied against employers in labor disputes: picketing and boycott activities. The use of picketing and the boycott and the protection of property may cause a conflict of rights. The Constitution and the labor laws do not establish any absolute right to picket or boycott regardless of purpose or effect, according to the views of the courts. The intent, the circumstances, and the result usually receive consideration.

Picketing of an establishment may take a number of forms, may be engaged in for a variety of reasons or purposes, and may or may not coexist with a strike. Two major forms of picketing exist, primary and secondary picketing. The primary picket results when workers in a given establishment patrol around it with placards, usually to inform workers and the public that the employer is unfair to union labor. A strike may or may not have been called. The gist of the primary picket is a dispute with the employer whose establishment is being patrolled. The secondary picket, which is a species of secondary boycott, involves the stationing of pickets around the place of business of a customer or supplier of the primary employer with which the union has a dispute, in order to cause others to refrain from dealing with the primary employer. Other forms of picketing will be discussed in subsequent sections along with the legal parameters for each category.

The Thornhill case presented in this section involves the constitutionality of a state statute that prohibited all picketing as a misdemeanor. Thornhill is a land- mark case in labor law because it held that the dissemination of information about the facts of a labor dispute must be regarded as within that area of free discussion guaranteed by the First and Fourteenth Amendments of the U.S. Constitution. Also presented in this section is the Meadowmoor Dairies, Inc., case. Violent picketing is unlawful in all jurisdictions, and the Meadowmoor court reconciles its decision with that of Thornhill v. Alabama.

Although Section 8(b)(1) of the NLRA prohibits union coercion, including violence, states have a basic constitutional right to regulate and enjoin violence occurring in the context of a labor dispute.


MURPHY, J.… Petitioner, Byron Thornhill, was convicted in the Circuit Court of Tuscaloosa County, Alabama, of the violation of Section 3448 of the State Code of 1923. The Code Section reads as follows: “Section 3448. Loitering or picketing forbidden. Any person or persons, who, without a just cause or legal excuse therefor, go near to or loiter about the premises or place of business of any other person, firm, corpora- tion or association of people, engaged in a lawful

business, for the purpose, or with intent of influenc- ing, or inducing other persons not to trade with, buy from, sell to, have business dealings with, or be employed by such persons, firm, corporation, or association of persons, for the purpose of hindering, delaying, or interfering with or injuring any lawful business or enterprise of another, shall be guilty of a misdemeanor; but nothing herein shall prevent any person from soliciting trade or business for a com- petitive business.”



At the close of the case for the State, petitioner moved to exclude all the testimony taken at the trial on the ground that Section 3448 was violative of the Constitution of the United States. The Circuit Court overruled the motion, found petitioner “guilty of Loi- tering and Picketing as charged in the complaint,” and entered judgment accordingly. The judgment was affirmed by the Court of Appeals, which consid- ered the constitutional question and sustained the sec- tion on the authority of two previous decisions in the Alabama courts.

The proofs consist of the testimony of two wit- nesses for the prosecution. It appears that petitioner on the morning of his arrest was seen “in company with six or eight other men” “on the picket line” at the plant of the Brown Wood Preserving Company. Some weeks previously a strike order had been issued by a Union, apparently affiliated with the American Federation of Labor, which had as members all but four of the approximately 100 employees of the plant. Since that time a picket line with two picket posts of six to eight men each had been maintained around the plant 24 hours a day. The picket posts appear to have been on Company property, “on a private entrance for employees, and not on any public road.” One witness explained that practically all of the employees live on Company property. No demand was ever made upon the men not to come on the property. There is no testimony indicating the nature of the dispute between the Union and the Preserving Company, or the course of events which led to the issuance of the strike order, or the nature of the efforts for conciliation.

The Company scheduled a day for the plant to resume operations. One of the witnesses, Clarence Simpson, who was not a member of the union, reporting to the plant on the day indicated, was approached by petitioner who told him that “they were on strike and did not want anybody to go up there to work.” None of the other employees said anything to Simpson, who testified: “Neither Mr. Thornhill nor any other employee threatened me on the occasion testified to. Mr. Thornhill approached me in a peaceful manner and did not put me in fear; he did not appear to be mad.” “I then turned and went back to the house, and did not go to work.” The other witness, J. M. Walden, testified: “At the time Mr. Thornhill and Clarence Simpson were talking to each other, there was no one else present, and I heard no harsh words and saw

nothing threatening in the manner of either man.” For engaging in some or all of these activities, petitioner was arrested, charged, and convicted as described.

The freedom of speech and of the press, which are secured by the First Amendment against abridgment by the United States, are among the fundamental per- sonal rights and liberties which are secured to all per- sons by the Fourteenth Amendment against abridgment by a state.

The safeguarding of these rights to the ends that men may speak as they think on matters vital to them and that falsehoods may be exposed through the pro- cesses of education and discussion is essential to free government. Those who won our independence had confidence in the power of free and fearless reasoning and communication of ideas to discover and spread political and economic truth. Noxious doctrines in those fields may be refuted and their evil averted by the courageous exercise of the right of free discussion. Abridgment of freedom of speech and of the press, however, impairs those opportunities for public edu- cation that are essential to effective exercise of the power of correcting error through the processes of popular government.

Section 3448 has been applied by the State courts so as to prohibit a single individual from walking slowly and peacefully back and forth on the public sidewalk in front of the premises of an employer, without speaking to anyone, carrying a sign or plac- ard on a staff above his head stating only the fact that the employer did not employ union men affiliated with the American Federation of Labor; the purpose of the described activity was concededly to advise customers and prospective customers of the relation- ship existing between the employer and its employees and thereby to induce such customers not to patron- ize the employer. O’Rourke v. City of Birmingham, 27 Ala. App. 133, 168 So. 206, certiorari denied 232 Ala. 355, 168 So. 209. The statute as thus authorita- tively construed and applied leaves room for no exceptions based upon either the number of persons engaged in the proscribed activity, the peaceful char- acter of their demeanor, the nature of their dispute with an employer, or the restrained character and the accurateness of the terminology used in notifying the public of the facts of the dispute….

We think that Section 3448 is invalid on its face. The freedom of speech and of the press guaranteed

by the Constitution embraces at least the liberty to discuss publicly and truthfully all matters of public



concern without previous restraint or fear of subse- quent punishment….

The range of activities proscribed by Section 3448, whether characterized as picketing or loitering or oth- erwise, embraces nearly every practicable, effective means whereby those interested—including the employees directly affected—may enlighten the public on the nature and causes of a labor dispute. The safe- guarding of these means is essential to the securing of an informed and educated public opinion with respect to a matter which is of public concern.

The State urges that the purpose of the challenged statute is the protection of the community from the violence and breaches of the peace, which, it asserts, are the concomitants of picketing. The power and the duty of the State to take adequate steps to preserve the peace and to protect the privacy, the lives, and the property of its residents cannot be doubted. But no clear and present danger of destruction of life or property, or invasion of the right of privacy, or breach of the peace can be thought to be inherent in the activities of every person who approaches the pre- mises of an employer and publicizes the facts of a labor dispute involving the latter. We are not now concerned with picketing en masse or otherwise con- ducted which might occasion such imminent and aggravated dangers to these interests as to justify a statute narrowly drawn to cover the precise situation giving rise to the danger. Compare American Steel Foundries v. Tri-City Council, 257 U.S. 184, 205…. Section 3448 in question here does not aim specifically

at serious encroachments on these interests and does not evidence any such care in balancing these interests against the interest of the community and that of the individual in freedom of discussion on matters of public concern.

It is not enough to say that Section 3448 is limited or restricted in its application to such activity as takes place at the scene of the labor dispute. “The streets are natural and proper places for the dissemination of information and opinion; and one is not to have the exercise of his liberty of expression in appropriate places abridged on the plea that it may be exercised in some other place.” Schneider v. State, 308 U.S. 147, 161…. Hague v. C.I.O., 307 U.S. 496, 515, 516…. The danger of breach of the peace or serious invasion of rights of property or privacy at the scene of a labor dispute is not sufficiently imminent in all cases to warrant the legislature in determining that such place is not appropriate for the range of activi- ties outlawed by Section 3448.


Case Questions

1. State the gist of Section 3448 of the Alabama Code.

2. What facts gave rise to the Thornhill indictment? 3. Did the Supreme Court hold Section 3448

invalid on its face? 4. What defense of the statute was made by the

state? How was the defense disposed of?


FRANKFURTER, J.… The Supreme Court of Illinois sustained an injunction against the Milk Wagon Drivers’ Union over the lat- ter’s claim that it involved an infringement of the free- dom of speech guaranteed by the Fourteenth Amendment. Since this ruling raised a question intrin- sically important, as well as affecting the scope of Thornhill v. Alabama, 310 U.S. 88, and Carlson v. California, 310 U.S. 106, we brought the case here.

The “vendor system” for distributing milk in Chi- cago gave rise to the dispute. Under that system,

which was fully analyzed in Milk Wagon Drivers’ Union v. Lake Valley Farm Products, 311 U.S. 91, milk is sold by the dairy companies to vendors oper- ating their own trucks who resell to retailers. These vendors departed from the working standards there- tofore achieved by the Union for its members as dairy employees. The Union, in order to compel observance of the established standards, took action against dairies using the vendor system. The present respon- dent, Meadowmoor Dairies, Inc., brought suit against the Union and its officials to stop interference with



the distribution of its products. A preliminary injunc- tion restraining all union conduct, violent and peace- ful, was promptly issued, and the case was referred to a master for report. Besides peaceful picketing of the stores handling Meadowmoor’s products, the master found that there had been violence on a considerable scale. Witnesses testified to more than fifty instances of window-smashing; explosive bombs caused sub- stantial injury to the plants of Meadowmoor and another dairy using the vendor system and to five stores; stench bombs were dropped in five stores; three trucks of vendors were wrecked, seriously injur- ing one driver, and another was driven into a river; a store was set on fire and in large measure ruined; two [vendors’] trucks were burned; a storekeeper and a truck driver were severely beaten; workers at a dairy which, like Meadowmoor, used the vendor sys- tem, were held up with guns and severely beaten about the head while being told “to join the union”; carloads of men followed vendors’ trucks, threatened the drivers, and in one instance shot at the truck and driver. In more than a dozen of these occurrences, involving window-smashing, bombings, burnings, the wrecking of trucks, shootings, and beatings, there was testimony to identify the wrongdoers as union men. In the light of his findings, the master recommended that all picketing, and not merely vio- lent acts, should be enjoined. The trial court, how- ever, accepted the recommendations only as to acts of violence and permitted peaceful picketing. The reversal of this ruling by the [Illinois] Supreme Court, 371 Ill. 377, 21 N.E. 2d 308, directing a per- manent injunction as recommended by the master, is now before us.

The question which thus emerges is whether a state can choose to authorize its courts to enjoin acts of picketing in themselves peaceful when they are enmeshed with contemporaneously violent con- duct which is concededly outlawed. The Constitution is invoked to deny Illinois the power to authorize its courts to prevent the continuance and recurrence of flagrant violence, found after an extended litigation to have occurred under specific circumstances, by the terms of a decree familiar in such cases….

The starting point is Thornhill’s case. That case invoked the constitutional protection of free speech on behalf of a relatively modern means for “publiciz- ing, without annoyance or threat of any kind, the facts of a labor dispute.” 310 U.S. 100. The whole series of cases defining the scope of free speech

under the Fourteenth Amendment are facets of the same principle in that they all safeguard modes appropriate for assuring the right to utterance in different situations. Peaceful picketing is the working- man’s means of communication.

It must never be forgotten, however, that the Bill of Rights was the child of the Enlightenment. Back of the guarantee of free speech lay faith in power of an appeal to reason by all the peaceful means for gaining access to the mind. It was in order to avert force and explo- sions due to restrictions upon rational modes of com- munication that the guarantee of free speech was given a generous scope. But utterance in a context of violence can lose its significance as an appeal to reason and become part of an instrument of force. Such utterance was not meant to be sheltered by the Constitution….

To maintain the balance of our federal system, insofar as it is committed to our care, demands at once zealous regard for the guarantees of the Bill of Rights and due recognition of the powers belonging to the state. Such an adjustment requires austere judg- ment, and a precise summary of the result may help to avoid misconstruction.

We do not qualify the Thornhill and Carlson deci- sions. We reaffirm them. They involved statutes baldly forbidding all picketing near an employer’s place of business. Entanglement with violence was expressly out of those cases. The statues had to be dealt with on their face, and therefore we struck them down. Such an unlimited ban on free communi- cation declared as the law of a state by a state court enjoys no greater protection here….

The exercise of the state’s power which we are sustaining is the very antithesis of a ban on all discus- sion in Chicago of a matter of public importance. Of course we would not sustain such a ban. The injunc- tion is confined to conduct near stores dealing in respondent’s milk, and it deals with this narrow area precisely because the coercive conduct affected it. An injunction so adjusted to a particular situation is in accord with the settled practice of equity, sanc- tioned by such guardians of civil liberty as Mr. Justice Cardozo. Compare Nann v. Raimist, 255 N.Y. 307, 174 N.E. 690. Such an injunction must be read in the context of its circumstances. Nor ought state action be held unconstitutional by interpreting the law of the state as though, to use a phrase of Mr. Justice Holmes, one were fired with a zeal to pervert. If an appropriate injunction were put to abnormal uses in its enforcement, so that encroachments were made on




Another form of peaceful picketing that may be illegal is that in which the pickets are so massed as to contain elements of implicit coercion growing out of the force of numbers. Some courts have been disposed to limit substantially the number of pickets on station or patrol and the manner of their position. Others have been more liberal as long as the picketing retained its essentially peaceful character.

The modern judicial view on this question continues to be found in the Carnegie-Illinois decision, presented in this section, which sets forth an example of unlawful mass picketing, properly enjoined by a state court.

Care must be exercised in drafting statutes that restrict individuals’ right to picket. A compelling state interest must be shown, and the regulation must be content-neutral, must be narrowly drawn, and must allow alternative means of expression. In the Nash case, presented in this section, the state of Texas mass picketing statute was struck down for being unconstitutionally overbroad.


MAXEY, C. J.… On January 25, 1946, a large group of pickets, esti- mated to be from 100 to 200 in number, standing three deep, extended across the gate and blocked the entrance to plaintiff’s Homestead plant and thus denied access to the plant to individuals below the rank of superintendent….

There were … injunction affidavits filed all pur- porting to show that supervisory officials were denied access to plaintiff’s plant and that the defendant labor union and its officials and agents had arrogated to itself and themselves the authority to determine what employees of the plaintiff corporation should and should not, respectively, enter the corporation’s plant, and that the Union enforced its assumed

authority by massing approximately 200 pickets at the gate leading into the plant.

The court below in response to the above bill of complaint, supported by the above injunction affida- vits and others, granted the injunction prayed for….

… When this case reached this court and the record was before us, it then became our duty to decide whether or not the facts showed that what the defen- dants were doing constituted a “holding” or “seizure” of the plant or any part of it. The holding or seizure of even one gateway to the plant entitled the plaintiff to the protection of a court of equity just as fully as would the seizure of an entire plant. When a “picket line” becomes a picket fence it is time for government to act. Collective coercion is not a legitimate child of

free discussion outside the limits of violence, as for instance discussion through newspaper or on the radio, the doors of this Court are always open.

The injunction which we sustain is “permanent” only for the temporary period for which it may last. It is justified only by the violence that induced it and only so long as it counteracts a continuing intimida- tion. Familiar equity procedure assures opportunity for modifying or vacating an injunction when its con- tinuance is no longer warranted….


Case Questions

1. Describe the “vendor system” of milk distribution.

2. Had the union previously resorted to violence? 3. What question does the Supreme Court say is

before it? 4. Did the Court qualify the Thornhill decision? 5. Is the scope of the injunction confined to a

particular physical area? 6. State the rule of law developed by the case.



collective bargaining. The forcible seizure of an employ- er’s property is the very essence of communism.

Injunctions are not issued against picketing when the latter’s only purposes are to advertise the fact that there is a strike in a certain plant and to persuade workers to join in the strike and to urge the public not to patronize the employer. For these purposes, a limited number of pickets is all that is necessary. But when hundreds of pickets are massed, as at least 200 were here at a single gate, it is obvious that this force was not mustered for a peaceful purpose….

We dismiss this appeal….

Case Questions

1. What workers did the pickets exclude from the plant?

2. Suppose regular production workers were the only ones excluded. Would this have made a difference in the decision of the court?

3. How many pickets were at the main entrance? 4. How did the court characterize the picket line in

its analogy? 5. State the rule of law of this case.


[The plaintiff John Nash, the president of Rubber Workers Local 746, and some 90 other individuals were arrested by Tyler, Texas, police officers for unlaw- ful picketing at the Schoellkopf Products Co. plant in Tyler, Texas, under the Texas mass picketing statute. The arrests forced the collapse of a strike against the company. Some three weeks after the arrests began, the plaintiffs received a preliminary injunction against the police in federal court and now seek declaratory relief that the mass picketing statute unconstitutionally infringed their First Amendment rights.]


I. On September 18, 1978, the National Labor Rela- tions Board certified Local 746 of the United Rubber Workers (“the union”) as the collective bargaining representative of an appropriate unit of employees at the Schoellkopf Products plant in Tyler….

During the period from September 1978, to Feb- ruary 8, 1979, the union bargained with Schoellkopf Products, without any disruption of work at the com- pany’s Tyler plant. On February 8, 1979, the union began engaging in protected concerted activity, in the form of a strike, against the company. Picket lines were thereafter established at the entrance to the com- pany’s plant in Tyler….

On March 14, 1979, the company filed a suit in a state court against the union, John Nash, and another union member, seeking a temporary restraining order, a

temporary injunction, and a permanent injunction against the union’s picketing activities. A temporary restraining order was granted, ex parte,…. on March 14, 1979, restraining picketing and other alleged activi- ties of the union and Local 746.

On March 15, 1979, the company’s president Hugo Schoellkopf, arranged for a meeting to be held in the office of the City Manager of Tyler, Texas, at 11:00 A.M. Schoellkopf, executive vice pres- ident Delbert Chandler, plant manager Jeff Keasler, and company attorney Erich Klein represented the company. Also present were City Manager Ed Wag- oner, Assistant City Manager Terry Childress, Chief of Police Willie Hardy, and the executive director of the Tyler Chamber of Commerce, Freeman Carney. Neither the City Attorney, State District Attorney, nor any union representative was invited to attend this meeting. According to Schoellkopf, the purpose of the meeting was to ensure that the City of Tyler and its Police Chief would enforce the mass picketing statute at the company’s Tyler plant. At the gather- ing, copies of the statute were made available to the city officials by the company representatives….

From March 15, 1979, to March 28, 1979, approximately 90 arrests were made for “unlawful picketing.” In arresting the picketers, the police cited three alleged violations of the mass picketing statute, Article 5154d, as follows:

1. Under the “numbers-distance” provision, § 1, paragraph 1, anyone who approached the two



picketers within fifty-foot markers laid out by police and union members was arrested, even a person intending to relieve a picketer on duty;

2. A picketer who caused a vehicle driven on the access and exit roads to the plant to stop, even momentarily, was arrested, allegedly pursuant to § 1, paragraph 2; and

3. Any striker or sympathizer who shouted “scab” or who was accused of uttering a profanity was arrested, supposedly in accordance with § 2 [an intimidating language provision] of the statute.

No arrests were made for alleged acts or threats of violence, destruction of property, or resisting arrest.

The arrests of the union’s attorneys were particu- larly notable. Ken Miller, Esquire, and Joe Beam, Esquire, counsel for Local 746, approached the picket line on March 15, 1979, at about 4:30 in the after- noon. Each identified himself to the police as an attorney for the picketing union members. Without regard to these facts, the Tyler police officers on the scene arrested each attorney for unlawful picketing, handcuffed both, and placed them, first, in the police paddy wagon and, later, in a patrol car. The two attorneys were afterwards taken to jail, booked, and processed. They were ultimately released on bail near midnight on March 15, 1979….

II. Section 1, paragraph 1, the Numbers-Distance Provision.

The numbers-distance section of the mass picketing statute makes it illegal for “more than two (2) pickets at any time” to be “within either fifty (50) feet of any entrance to the premises being picketed, or within fifty (50) feet of any other picket or pickets.” Tex.Rec.Civ. Stat.Ann. art. 5154d § 1, paragraph 1 (Vernon 1971). This provision, therefore, regulates the time, place, and manner of speech, for the enforcement of this sec- tion is not, facially, affected by the content of speech.

The Supreme Court has held that a state may reg- ulate the time, place, and manner of speech, if there is a compelling state interest justifying the restriction. Heffron v. International Society for Krishna Con- sciousness, 452 U.S. 640, 649 (1981). If a compelling interest is shown, nonetheless, the regulation must be content-neutral, narrowly drawn so as to least restrict protected speech, allow alternative means of expres- sion, and, as well, be rationally related to the state interest it is designed to further. Consequently, in preparation for determining whether the questioned

statute was drawn with sufficient precision, its poten- tial for misuse must be pragmatically confronted….

It is unquestioned that a state may legitimately regulate violence at a picket line, because the First Amendment protects only “peaceful” picketing. See, e.g., Thornhill, 310 U.S. 88, 102 (1940) (“the dissem- ination of information concerning the facts of a labor dispute must be regarded as within the area of free discussion that is guaranteed by the constitution”). A state, therefore, has a “substantial” interest in arresting violent picketers. But the statute under con- sideration is not aimed at violence per se. The state characterizes Article 5154d as a preventive measure, and, in fact, the statute “prohibit[s] conduct which often le[ads] to … violence.” Sherman v. State, 626 S.W. 2d 520, 524 (Tex.Cr.App. 1981) (emphasis added). Furthermore, the state admits that the goal of preventing violence “is achieved at considerable expense to an individual’s or group of individuals’ right to effectively communicate.” Intervenor’s Sup- plemental Pre-Trial Brief at 9. The Supreme Court has stressed that, while a state has a compelling inter- est in restricting violent behavior at a picket line, it has no substantial interest in regulating acts that might lead to violence.

In Thornhill, the Supreme Court declared unconsti- tutionally overbroad an anti-picketing statute similar in many respects to the Texas mass picketing statute. There, the Court determined that the declared state interest, the “protection of the community from the vio- lence and breaches of the peace,” did not sufficiently justify the statute that was adopted. Thornhill, 310 U.S. at 105. The court emphasized in Thornhill that, because there was no picketing “en masse,” claims of a state interest in protecting the community were not credible, and that free speech could be abridged only where the clear danger of a substantive evil arises.

As in Thornhill, the numbers-distance formula here in issue is not limited to “en masse” picketing, for it prohibits more than two persons from standing near an entrance of a business. The presence of two pick- eters, both standing 50 feet from a company entrance and from one another, cannot forebode such violence that there is a “significant and legitimate state interest” in arresting those picketers and thereby curtailing their speech. Moreover, the Texas statute is even more restrictive than the statute challenged in Thornhill. The Thornhill statute applied only to the picketing of businesses. The Texas statute, on the other hand, applies to picketing at “any premises.” Additionally, the Thornhill statute applied only to labor picketing, whereas the Texas statute reaches more broadly, and



realistically could be employed to proscribe picketing activities in many other contexts.

The state has not suggested any other compelling state interest that would justify the anti-picketing stat- ute. For example, the Texas statute is not specifically directed at the state interest in protecting public order at critical locations. Anti-picketing statutes in issue before the Supreme Court have: assured peace- ful ingress to and egress from public buildings, Cameron v. Johnson, 390 U.S. 611 (1968); regulated picketing near a school, Grayned v. City of Rockford, 408 U.S. 104 (1972); and restricted picketing at or near a courthouse, Cox v. Louisiana, 379 U.S. 559 (1965). The reach of the Texas statute, to the con- trary, is far more extensive than the regulations that have been upheld, and closely resembles enactments that have been declared unconstitutionally overbroad.

… The numbers-distance provision facially does not allow adequate “breathing space”; its over- breadth—its unnecessary stifling of First Amendment rights—renders it unconstitutional.

III. Section 2, The Intimidating Language Provision.

Section 2 states:

It shall be unlawful for any person, singly or in concert with others, by use of insulting, threat- ening or obscene language, to interfere with, hinder, obstruct, or intimidate, or seek to interfere with, hinder, obstruct, or intimidate, another in the exercise of his lawful right to work, or to enter upon the performance of any lawful vocation, or from freely entering or leaving any premises.

Section 2 expressly regulates speech and is thus a content-based statute; as such, it is necessary that it be rigorously tested….

In this case, the statute proscribes such broad cate- gories of speech that themeaning of thewords, “insult,” “threaten,” “obscene,” “interfere with,” “hinder,” “obstruct,” and “intimidate,” becomes unclear.

By way of illustration, it would seem obvious that a protester should not be prosecuted for calling another person a “nerd,” but, if a police officer con- ceived that the intimidating language provision was violated by its use, the statute would allow the prose- cution. Because of that, a picketer must speculate as to which words are punishable. But due process requires that persons be given fair notice of what actions are illegal, and that the discretion allowed law enforcement officers be limited by explicit

statutory standards. Kolender v. Lawson, 455 U.S. 999 (1983). As presently drawn, the statute mani- festly could have a chilling effect on those who are unclear regarding what is unlawful, and these indivi- duals, on that account, well might restrict “their con- duct to that which is unquestionably safe,” Baggett v. Bullitt, 377 U.S. 360, 372 (1964).

The circumstance of this case indicate that union members who called non-strikers “scabs” had no inten- tion of violating § 2. Nevertheless, the police so inter- preted the statute as to arrest the union members for simply using that word. The situation here was not one … in which any word was said with the requisite degree of force, by a sufficient number of persons, to create a “fighting words” reaction; and there was no evidence of threatened violence in connection with use of the term. The workers who were leaving the plant were in vehicles, and there were few face-to-face con- frontations. If this statute were allowed to stand, local law enforcement officers conceivably could find such pejorative words as “strikebreaker” or “fink” to be in violation of § 2.Cf. Cohen v. California, 403 U.S. at 16 (refusing to forbid public display of single four-letter expletive when the prohibition would also create a substantial risk of suppressing ideas). Certainly, those contemplating picketing will have no assurance that this will not be the case. Therefore, “persons of com- mon intelligence” cannot determine what words to avoid to remain within the laws; moreover, the discretion of law enforcement officers has not been sufficiently limited.

Conclusion Picketing claims a historic place in the history of America, providing an opportunity for diverse groups to express their ideas publicly. Article 5154d is not drafted with the precision necessary to save it from the challenges made to its constitu- tionality. Both § 2 and § 1, paragraph 1, of Article 5154 are in disregard of the First Amendment, since both are unconstitutionally overbroad. Additionally, § 2 is unconstitutionally vague.

Case Questions

1. Summarize the facts of the case. 2. Assess the fairness of the ex parte temporary

restraining order granted on March 14. 3. Was the 50-foot provision justified by the state’s

interest in preventing violence? 4. What purpose does picketing serve?



The NLRB and the courts have had difficulty resolving questions regarding the extent of employee and nonemployee union organizers’ rights to have access to an employer’s property. The Supreme Court’s Lechmere, Inc. v. NLRB decision, pre- sented in this section, sharply narrowed the circumstances under which nonemploy- ees may have access to an employer’s property.


Section 7 of the NLRA guarantees employees the right to self-organization. Section 8(a)(1) of the NLRA prohibits employers from interfering with, restraining, or coercing employees in the exercise of their Section 7 rights. For Section 7 rights to be meaningful, their effectiveness depends in some measure on the ability of employees to learn the advantages and disadvantages of unionization from others. “Others” who are interested in discussing the advantages of unionization are non- employee union organizers. Although Section 7 rights are the workers’ rights, unions and their agents derivatively have been given the protection of Section 7.7

Union organizers and other union adherents, seeking to initiate an organiza- tional campaign at a nonunion company, based on their derivative Section 7 rights, have often engaged in activities inconsistent with traditional notions of private prop- erty rights. It is up to the NLRB and the courts to seek a proper accommodation between organizational rights and property rights. The Supreme Court first set forth guiding principles for resolving conflicts between Section 7 rights and property rights in its NLRB v. Babcock & Wilcox Co.8 decision, in the following language:

Organization rights are granted to workers by the same authority, the National Government, that preserves property rights. Accommodation between the two must be obtained with as little destruction of one as is consistent with the maintenance of the other. The employer may not affirmatively interfere with organization; the union may not always insist that the employer aid organization. But when the inaccessibility of employees makes ineffective the reasonable attempts by nonemployees to communicate with them through the usual channels, the right to exclude from property has been required to yield to the extent needed to permit communication of information on the right to organize.9

In Babcock, a case involving an industrial plant employer’s refusal to allow non-employee union organizers access to its private parking lot to distribute orga- nizational literature to employees, the Court held that the nonemployee organizers were not entitled to access to company property because the employees lived in nearby communities and could be reached by “the usual methods of imparting information” (i.e., by literature sent through the mail, home visits, and telephone calls). Under Babcock, an employer may prohibit the distribution of union literature

7 See Sears, Roebuck & Co. v. San Diego District Council of Carpenters, 436 U.S. 180, 206 n. 42 (1978); Central Hardware Co. v. NLRB, 407 U.S. 539, 542 (1972). 8 351 U.S. 105 (1956). 9 Id. at 112.


by nonemployee organizers if (1) “reasonable efforts by the union through other available channels of communication will enable it to reach the employees with its message…”10 and (2) the employer does not discriminate against the union by allowing other distributions.


Some 12 years after its Babcock & Wilcox decision, the Supreme Court considered the case of Amalgamated Food Employees Local 590 v. Logan Valley Plaza, Inc.11

This case involved organizational picketing, by nonemployee union organizers, of a supermarket located in a shopping mall. Rather than treat this case under the prin- ciples set forth in Babcock, the Supreme Court held that shopping center picketing was protected under the First Amendment, notwithstanding the fact that the picket- ing took place on private property. The Court’s rationale was that the shopping center was open to the public and was the functional equivalent of a city “business block” and for the purpose of the First Amendment must be treated in substantially the same manner.

In Central Hardware v. NLRB,12 decided four years after Logan Valley, the Supreme Court limited the applicability of Logan Valley. Union organizers had engaged employees in Central’s single-store parking lot in violation of the store’s no-solicitation policy. The Court did not believe that a parking lot serving a single store was the functional equivalent of a “business block.” The Court ruled that Babcock and not Logan Valley was the controlling precedent.

In Hudgens v. NLRB,13 decided in 1976, the Supreme Court effectively over- ruled Logan Valley, holding that there is no First Amendment right to picket on the premises of a privately owned shopping center. The Hudgens case dealt with a shop- ping mall’s interference with the picketing of a shoe store at the mall by the shoe company’s unionized warehouse workers in furtherance of their economic strike against that employer. The Court, returning to its Babcock precedent, remanded the case to the Board, instructing it to seek a proper accommodation between the Section 7 rights of employees and private property rights, “with as little destruction of one as is consistent with the maintenance of the other.” On remand, the Board decided that the proper accommodation between Section 7 rights and private prop- erty rights required that the warehouse workers be allowed to picket.14


In a number of decisions, the Board grappled with the basic question of how to accommodate the exercise of rights guaranteed under Section 7 with a property owner’s right to protect its property from union trespassers. Ultimately, in its Jean

10 Id. 11 391 U.S. 308 (1968). 12 407 U.S. 539 (1972). 13 424 U.S. 507 (1976). 14 230 NLRB 414 (1977).


Country15 decision, the Board devised a test that involved assessment and weighing of the interrelated facts concerning (1) the strength of the union’s Section 7 rights, (2) the strength of the employer’s property rights, and (3) the availability of reason- able and effective alternative means of communication.


Local 919 of the United Food and Commercial Workers sought to organize the 200 workers at a newly opened Lechmere store located in a strip mall in Newing- ton, Connecticut. On June 18, union organizers began leafletting cars at this so- called Lechmere mall, but the organizers were ordered by store officials to leave the parking lot, and the leaflets were removed by security guards. The union placed five advertisements in the Hartford Courant in an attempt to organize Lechmere’s workforce, with little evidence that affected employees actually saw the ads. The union also took down the license plate numbers of cars parked where employees had been told to park, and the union obtained certain names and addresses from the Registry of Motor Vehicles. Ultimately it obtained 41 names and addresses from all their efforts, but half of the individuals had unlisted telephone numbers. The union filed unfair labor practice charges against Lechmere because of its refusal to allow representatives of Local 919 to engage in organizational activity in the parking lot. The Board decided that Lechmere had committed an unfair labor practice by barring union representatives from handbilling in the parking lot, and Lechmere petitioned for review of the Board’s order.

Lechmere, Inc., believed that it had the absolute right to ban the nonemployee union organizers from its property under the Babcock decision. It posted on each set of doors to its premises 6} × 8} signs stating:

TO THE PUBLIC. No Solicitation, Canvassing, Distributing of Literature or Trespassing by Non-Employees in or on Premises.

Lechmere strictly enforced this no-solicitation rule in its store and parking lots. Lechmere also believed that the union did have reasonable alternative means of communicating with Lechmere’s employees through the “usual channels” as stated in Babcock.

After the NLRB’s decision in favor of the union, the Court of Appeals for the First Circuit approved and applied the Jean Country test in upholding the Board’s order.16 The court found that the union’s Section 7 interest in disseminating orga- nizational information to employees was “robust.” The strength of Lechmere’s property right was not quite as strong, according to the court, even though Lech- mere was a co-owner and followed a strict no-solicitation rule, because of the pub- lic nature of the parking lot, and the union activity did not disrupt business, constitute harassment, or impede traffic flow. The third Jean Country test— whether the union had open to it other reasonable and effective means of reaching

15 129 LRRM 1201 (1988). 16 914 F.2d 313 (1st Cir. 1990).


the workforce—also weighed in favor of the union, according to the court. The court reasoned that although the union had expended considerable time and effort, it was able to compile merely a skeletal employee roster. The mail, which is not an effective alternative to personal contact, was impractical because of the incomplete list of names and addresses. Newspaper advertising was futile. Television advertising of the organizational message would be expensive, and in the context of reaching 200 workers in a market of 900,000 people would be extravagantly wasteful. Much the same can be said for radio and newspaper adver- tising. The court concluded that the Board had a rational basis for its conclusions in this case, and it supported the Board’s holding that Lechmere had violated Section 8(a)(1) of the NLRA by barring union representatives from organizational activity in the mall’s parking lots.

The Supreme Court rejected the Jean Country balancing test, as it applied to nonemployee union organizers, as contrary to its handling in Babcock. The Court explained that under Babcock, an employer may not be compelled to allow distri- bution of union literature by nonemployee organizers on its property except under the very narrow circumstances where the location of the property and the living quarters of the employees place the employees beyond the reach of reasonable union efforts to communicate with the employees. Examples of such isolated loca- tions are logging camps, mining camps, and mountain resort hotels. The Supreme Court majority found that the union organizers had reasonable access to employees outside the employer’s property.


As a result of Lechmere, Inc., employers who have and enforce a no-solicitation policy on their private property as a general rule cannot be compelled to allow nonemployee union organizers on their property to distribute organizational litera- ture.17 However, where employers do not exclude other organizations, such as political or charitable groups, from soliciting on their property, they may find

17 Broader free speech rights under California law led to a different outcome in that state. It was state property law that created the interest entitling employers such as Lechmere to exclude outside union organizers from company-owned store parking lots. California’s state constitution provides broader free speech rights than the First Amendment to the U.S. Constitution. California law permits reason- ably exercised free speech at privately owned shopping centers and adjacent walkways and parking lots. In Robbins v. Pruneyard Shopping Center, 23 Cal. 3d 899 (1979) the California Supreme Court held that the liberty-of-speech clause of the California Constitution protected speech in a privately owned shopping center, subject to the owner’s reasonable time, place, and manner restrictions, because the owner had created a public forum for speech. (See also Fashion Valley Mall, LLC v. NLRB, 42 Cal. 4th 850 [2007].) The shopping center at issue in Pruneyard consisted of 21 acres, with 65 shops, 10 restaurants, and a cinema. Subsequent cases decided by the California courts of appeal have distin- guished the large Pruneyard-type shopping center from large individual retail stores. These cases have held that the entrance areas and aprons of these large retail stores do not present a public forum and are a private forum. In Ralph’s Grocery Co. v. UFCW, 188 LRRM 3153 (2010), the Court of Appeal of California held that the entrance to Ralph’s stand-alone “Food Co.” store in Sacramento was a “private forum,” without common areas or outdoor seating, and thus the owner could limit the speech allowed on its property. The court found that the two state laws that precluded injunctive relief against peaceful picketing on private property were constitutional, and it held that Ralph’s was entitled to an injunction that would prevent trespassing by a union picketing the nonunion store.


themselves subject to disparate treatment claims by unions under Babcock & Wilcox, which allows no-solicitation rules against unions so long as the employer does not discriminate against unions by allowing other distributions.18 Contrary precedents exist in the Sixth Circuit. In Albertsons, Inc., v. NLRB,19 the Sixth Cir- cuit Court of Appeals refused to enforce a Board ruling that five Albertsons super- markets in Oregon and Washington20 had discriminated against the United Food and Commercial Workers Union (UFCW) when it banned the union from distribut- ing union materials in organizing drives at their stores, which activities Albertsons stated were in violation of its no-solicitation policy. In fact, Albertsons had allowed charitable, civic, and educational groups to solicit its customers near the entrances to their stores, including the Salvation Army, and various youth, school, and veter- ans groups. The Board believes the employer’s tolerance of nonemployee charitable solicitations is probative evidence of discrimination against nonemployee organiz- ing activity. However, the Sixth Circuit believes that for discrimination to exist, it must be among comparable groups or activities and the activities themselves under consideration must be comparable; and it points out that Albertsons did not allow nonunion organizers of another union to disseminate union information that it banned the UFCW for disseminating. Employees continue to have their Section 7 organizational rights on company property. The rights of employee economic stri- kers on private property continue to be under the guidance of the Hudgens princi- ple under which the Board, on a case-by-case basis, seeks a proper accommodation between Section 7 rights and private property rights, “with as little destruction of one as is consistent with the maintenance of the other.”

In its Leslie Homes, Inc., decision,21 a Board majority held that the Lechmere decision leaves the NLRB little choice but to bar almost all activity on an employ- er’s private property, including area-standards picketing.


[Petitioner Lechmere, Inc., owns and operates a retail store located in a shopping plaza in Newington, a suburb of Hartford, Connecticut. Lechmere is also part owner of the plaza’s parking lot, which is sepa- rated from a public highway by a 46-foot-wide grassy strip, almost all of which is public property. In a cam- paign to organize Lechmere employees, nonemployee

union organizers from Local 919 of the UFCW union placed handbills on the windshields of cars parked in the employees’ part of the parking lot. After Lech- mere denied the organizers access to the lot, they picketed from the grassy strip. In addition, they were able to contact directly some 20 percent of the employees. The union filed an unfair labor practice

18 Riesbeck Food Markets, Inc., 315 NLRB 940 (Dec. 16, 1994). But see Register-Guard, 351 NLRB No. 70 (2007). 19 301 F.3d 441 (6th Cir. 2002). 20 Although the dispute arose at stores in Oregon and Washington, which are part of the Ninth Circuit Court of Appeals, Albertsons, Inc., also has stores in Michigan and Tennessee, which are located in the Sixth Circuit. Knowing that favorable precedents existed in the Sixth Circuit, Albertsons brought its appeal of the Board’s decision to this circuit. 21 316 NLRB 29 (1995).



charge with the Board, alleging that Lechmere had violated the NLRA by barring the organizers from its property. An administrative law judge ruled in the union’s favor. The Board affirmed, and the court of appeals enforced the Board’s order.]


A. Section 7 of the NLRA provides in relevant part that “[e]mployees shall have the right to self-organization, to form, join, or assist labor organizations.” 29 U.S.C. § 157. Section 8(a)(1) of the Act, in turn, makes it an unfair labor practice for an employer “to interfere with, restrain, or coerce employees in the exercise of rights guaranteed in [§ 7].” 29 U.S.C. § 158(a)(1). By its plain terms, thus, the NLRA confers rights only on employees, not on unions or their nonemployee organizers. In NLRB v. Babcock & Wilcox Co., 351 U.S. 105 (1956), however, we recognized that insofar as the employ- ees’ “right of self-organization depends in some mea- sure on [their] ability… to learn the advantages of self-organization from others,” id., at 113, § 7 of the NLRA may, in certain limited circumstances, restrict an employer’s right to exclude nonemployee union organizers from his property. It is the nature of those circumstances that we explore today….

[In Babcock, the Board ordered the company to allow the nonemployee organizers to distribute litera- ture on its parking lot and walkways; the court of appeals refused to enforce the order; and the Supreme Court decided to hear the case.] While recognizing that “the Board has the responsibility of ‘applying the Act’s general prohibitory language in the light of the infinite combinations of events which might be charged as violative of its terms,’” 351 U.S., at 111– 112 (quoting NLRB v. Stowe Spinning Co., 336 U.S. 226, 231 (1949)), we [the Supreme Court] explained that the Board had erred by failing to make the criti- cal distinction between the organizing activities of employees (to whom § 7 guarantees the right of self-organization) and nonemployees (to whom § 7 applies only derivatively). Thus, while “[n]o restric- tion may be placed on the employees’ right to discuss self-organization among themselves, unless the employer can demonstrate that a restriction is neces- sary to maintain production or discipline,” 351 U.S., at 113 (emphasis added) (citing Republic Aviation Corp. v. NLRB, 324 U.S. 793, 803 (1945)), “no

such obligation is owed non-employee organizers,” 351 U.S., at 113. As a rule, then, an employer cannot be compelled to allow distribution of union literature by nonemployee organizers on his property. As with many other rules, however, we recognized an excep- tion. Where “the location of a plant and the living quarters of the employees place the employees beyond the reach of reasonable union efforts to communicate with them,” ibid., employers’ property rights may be “required to yield to the extent needed to permit com- munication of information on the right to organize,” id., at 112….

B. The threshold inquiry in this case, then, is whether the facts here justify application of Babcock’s inacces- sibility exception. The ALJ below observed that “the facts herein convince me that reasonable alternative means [of communicating with Lechmere’s employ- ees] were available to the Union,” 295 N.L.R.B. No. 15, ALJ slip op., at 9 (emphasis added). Reviewing the ALJ’s decision under Jean Country, however, the Board reached a different conclusion on this point, asserting that “there was no reasonable, effective alternative means available for the Union to commu- nicate its message to [Lechmere’s] employees.” 295 N.L.R.B. No. 15, Board slip op., at 4–5.

We cannot accept the Board’s conclusion, because it “rest[s] on erroneous legal foundations.” As we have explained, the exception to Babcock’s rule is a narrow one. It does not apply wherever nontrespas- sory access to employees may be cumbersome or less- than-ideally effective, but only where “the location of a plant and the living quarters of the employees place the employees beyond the reach of reasonable union efforts to communicate with them,” 351 U.S., at 113 (emphasis added). Classic examples include logging camps, … mining camps, … and mountain resort hotels, … Babcock’s exception was crafted precisely to protect the § 7 rights of those employees who, by virtue of their employment, are isolated from the ordinary flow of information that characterizes our society. The union’s burden of establishing such iso- lation is, as we have explained, “a heavy one,” and one not satisfied by mere conjecture or the expression of doubts concerning the effectiveness of nontrespas- sory means of communication.

The Board’s conclusion in this case that the union had no reasonable means short of trespass to make Lechmere’s employees aware of its organizational



efforts is based on a misunderstanding of the limited scope of this exception. Because the employees do not reside on Lechmere’s property, they are presump- tively not “beyond the reach,” Babcock, supra, at 113, of the union’s message. Although the employees live in a large metropolitan area (Greater Hartford), that fact does not in itself render them “inaccessible” in the sense contemplated by Babcock. Their accessi- bility is suggested by the union’s success in contacting a substantial percentage of them directly, via mail- ings, phone calls, and home visits. Such direct con- tact, of course, is not a necessary element of “reasonably effective” communication; signs or advertising also may suffice. In this case, the union tried advertising in local newspapers; the Board said that this was not reasonably effective because it was expensive and might not reach the employees. 295 N.L.R.B. No. 15, Board slip op., at 4–5. Whatever the merits of that conclusion, other alternative means of communication were readily available. Thus, signs (displayed, for example, from the public grassy strip adjoining Lechmere’s parking lot) would have informed the employees about the union’s orga- nizational efforts. (Indeed, union organizers picketed the shopping center’s main entrance for months as employees came and went every day.) Access to employees, not success in winning them over, is the critical issue—although success, or lack thereof, may be relevant in determining whether reasonable access exists. Because the union in this case failed to estab- lish the existence of any “unique obstacles,” that frus- trated access to Lechmere’s employees, the Board erred in concluding that Lechmere committed an unfair labor practice by barring the nonemployee organizers from its property.

* * * The judgment of the First Circuit is therefore

reversed, and enforcement of the Board’s order denied.

It is so ordered.

JUSTICE WHITE, with whom JUSTICE BLACKMUN joins, Dissenting….

In the case before us, the Court holds that Babcock itself stated the correct accommodation between property and organizational rights; it interprets that case as construing §§7 and 8(a)(1) of the National

Labor Relations Act to contain a general rule forbid- ding third-party access, subject only to a limited exception where the union demonstrates that the location of the employer’s place of business and the living quarters of the employees place the employees beyond the reach of reasonable efforts to communi- cate with them. The Court refuses to enforce the Board’s order in this case, which rested on its prior decision in Jean Country, 291 N.L.R.B. 11 (1988), because, in the Court’s view, Jean Country revealed that the Board misunderstood the basic holding in Babcock, as well as the narrowness of the exception to the general rule announced in that case.

For several reasons, the Court errs in this case…. … [T]he Court in Babcock recognized that actual

communication with nonemployee organizers, not mere notice that an organizing campaign exists, is necessary to vindicate § 7 rights, 351 U.S., at 113. If employees are entitled to learn from others the advantages of self-organization, ibid., it is singularly unpersuasive to suggest that the union has sufficient access for this purpose by being able to hold up signs from a public grassy strip adjacent to the highway leading to the parking lot.

Second, the Court’s reading of Babcock is not the reading of that case reflected in later opinions of the Court. We have consistently declined to define the principle of Babcock as a general rule subject to narrow exceptions, and have instead repeatedly reaf- firmed that the standard is a neutral and flexible rule of accommodation.

Third, and more fundamentally, Babcock is at odds with modern concepts of deference to an admin- istrative agency charged with administering a statute….

Case Questions

1. State the Babcock rule as set forth in the major- ity opinion. Is the exception to the rule a broad one?

2. Did the nonemployee union organizers have reasonable access to Lechmere employees outside the employer’s property?

3. Did the dissent agree that there was sufficient access given the union organizers, as they were able to hold up signs from a grassy strip adjacent to the highway?



The Labor-Management Reporting and Disclosure Act of 1959 comprehensively addressed the issues regarding organizational and recognitional picketing by amending the NLRA with an additional union unfair labor practice in Section 8(b)(7). In enacting this unfair labor practice, Congress sought to provide statutory protec- tion to employers who, though innocent of misconduct or illegality, might be subjected to long, extended, and harassing picketing. The effect of such picketing, in some cases, would force employers to illegally grant recognition to an uncertified union that did not, in fact, command sufficient employee support to win an election under the provisions of Section 9 of the NLRA. Informational or, as it is often called, “area-standards” picketing is not subject to Section 8(b)(7).

The summary language of Section 8(b)(7) reads as follows:

(b) It shall be an unfair labor practice for a labor organization or its agents— (7) to picket or cause to be picketed, or threaten to picket… any employer where an object thereof is forcing or requiring an employer to recognize or bargain with a labor organization … unless such labor organization is currently certified as the representative of such employees: (A) where the employer has lawfully recognized … any other labor organization

and a question concerning representation may not appropriately be raised under section 9(c) of this Act,

(B) where within the preceding twelve months a valid election under section 9(c) of this Act has been conducted, or

(C) where such picketing has been conducted without a petition under section 9(c) being filed [to secure NLRB resolution of representation right] within a reason- able period of time not to exceed thirty days from the commencement of such picketing.22

To illustrate the manner in which these three provisions operate, let us take an assumed set of facts and proceed with the action, with initial focus on subsections (A) and (B). An uncertified union is peacefully picketing an employer for recognition even though the employer is already legally bargaining under the circumstances detailed in (A) and (B) of the quoted provision. The employer may then file an unfair labor practice charge under Section 8(b)(7) with the NLRB. If the Board finds that the employer’s statement truly represents the facts of the case, it will find the union responsible for the commission of an unfair labor practice and take appropriate steps for cessation of the practice.

Let us now examine subsection (C), altering the facts in one particular. Assume that there is, at present, no union representative and the uncertified union peace- fully pickets to secure recognition by the employer. If, after 30 days of picketing, no party files a petition for an election under Section 9(c), the picketing becomes violative of Section 8(b)(7) and subject to injunctive relief.

Suppose, however, that one of the parties involved in the organizational picket- ing does file such petition within the prescribed 30 days. Under the language of

22 Brackets and italics added.


Section 8(b)(7)(C), “The Board shall forthwith,23 without regard to the provisions of Section 9(c)(1) or the absence of a showing of substantial interest on the part of the labor organization, direct an election … and shall certify the results thereof.”

The NVE Constructors, Inc. v. NLRB decision, presented in this section, con- tains a discussion of how Section 8(b)(7)(C) was designed to work and allowed the construction union in this case the limited right to engage in recognitional picketing.

So-called area-standards or informational picketing is permissible picketing not subject to Section 8(b)(7)(C) because this picketing does not have an organizational or recognitional objective. This type of picketing is common to the construction and retailing industries and is a form of protest against a nonunion business whose wage scales or terms of employment are below those of other area firms. The Board will, however, look beyond a union’s assertion of area-standards picket- ing for evidence of recognitional or organizational objectives. Thus, picketing with demands broader than necessary to achieve area standards, coupled with an offer to the employer to negotiate, has supported a finding that the union had a recogni- tional objective.24


[From January 5 to January 14, 1988, Laborers’ Inter- national Union of North America, Local No. 1184 (the union) picketed the construction site where NVE Constructors, Inc. (NVE) was a general contractor on a state prison project. At the gate reserved for NVE employees, the union displayed picket signs that stated: “NVE, No Contracts. Laborers’ Local 1184, AFL-CIO.” As a result of the picketing, NVE did not receive deliveries of concrete scheduled for January 5–7, 1988. At the time of the picketing, NVE was not a party to a collective bargaining agreement with the union. There were 20 NVE employees at the jobsite, but those employees had not designated the union as their bargaining representative. According to the union’s business agent, the purpose of the picketing was “to obtain a contract either by authorization from the people through authorization cards or the contractor or contractors signing a prehire agreement voluntarily.” The picketing stopped on January 13, 1988, after NVE filed an unfair labor practice charge

alleging a violation of Section 8(b)(7)(C) of the Act. The Board dismissed the complaint, concluding that “at least with respect to any employer, which has employees, we do not believe that recognitional and organizational picketing by a minority union in the construction industry is prohibited by Section 8(b)(7)(C) of the Act if the picketing meets the time limitations set forth in that section.”NVE petitioned for review.]

BEEZER, C. J.… Section 8(b)(7) of the Act makes it an unfair labor practice for a union to picket to force an employer to recognize or bargain with it if the employer has already recognized another union or if there has been a representation election within the preceding 12 months. If neither of these situations exist, such picketing may be conducted for “a reasonable period not to exceed 30 days from the commencement of such picketing to gain recognition.” The union may

23 Italics added. This means that an election is held on an expedited schedule. 24 NLRB v. Electrical Workers Local 265, 602 F.2d 1091 (8th Cir. 1979).




In Section 8(b)(4)(D), some additional economic pressures by unions are prohib- ited. When the purpose of a strike or boycott is to compel work assignment to members of a trade, craft, class, or organization in the absence of a Board certifica- tion or ruling concerning that particular work, a violation occurs.

This particular violation receives a different, accelerated treatment, because the Act gives the parties 10 days, after notice that charges have been filed, to attempt to adjust the dispute. If satisfactory evidence of adjustment or of an agreed-upon method for adjustment is submitted within 10 days, the proceeding ends. Other- wise, under Section 10(k), the dispute may be heard and determined by the

not picket beyond this time without filing a petition for a representation election. Id.

The purpose of section 8(b)(7) is “to ensure that employees [are] free to make an uncoerced choice of bargaining agent.” This was accomplished in section 8(b)(7)(C) by encouraging “prompt resort to the Board’s election machinery, rather than protracted picketing, as the method for resolving questions con- cerning representation.”

Section 8(f) of the Act provides that it is not an unfair practice for unions and employers in the con- struction industry to enter into collective bargaining agreements even though the employees of that employer have not designated the union as their law- ful bargaining representative. These agreements are known as “prehire agreements.” …

[A]t the same time it enacted section 8(f), Congress included a provision protecting employers from being pressured to enter into agreements with minority unions. If the picketed employer doubts that the union enjoys the support of a majority of its employ- ees, the employer may file an election petition. See NLRA § 8(b)(7)(C). When an election petition is filed in a situation in which a noncertified union is picketing, the Board must direct an expedited represen- tation election, without first investigating the petition to determine whether a question of representation exists. See id. §§ 8(b)(7)(C), 9(c). If the election demonstrates that a majority of the employees do not support the union, section 8(b)(7)(B) bars the union from picketing for twelve months.

NVE argues that the effect of the Board’s decision is to legalize the “very top-down organizing weapon Congress condemned in enacting” section 8(b)(7)(C)….

… In the case of section 8(f), Congress acted to limit the potential top-down effects of allowing prehire

agreements by allowing employees to invalidate a pre- hire agreement by petitioning for a representation or decertification election at any time during the period covered by the agreement. 29 U.S.C. § 158(f) (1988).

The Board’s interpretation of sections 8(b)(7)(C) and 8(f) is “rational and consistent with the Act.” …

Section 8(b)(7)(C) is intended “to encourage prompt resort to the Board’s election machinery, rather than protracted picketing, as the method for resolving questions concerning representation.” …

More serious interference with work has not per- suaded the Board to shorten the [30-day] period. In Walters Foundation, 203 NLRB 397, for example, the Board did not find unreasonable a 22-day period of picketing, and in Colson & Stevens Constr. Co., 137 NLRB 1650, the Board found the period of pick- eting not to be unreasonable where suppliers refused to cross the picket lines for 29 days. Furthermore, nothing in the present case prevented NVE from filing for an expedited election and resolving quickly the issue of the union’s majority support. The Board’s determination that the picketing did not exceed a reasonable period of time is thus reasonable and supported by the record.

The petition for review of the Board’s order is DENIED.

Case Questions

1. How are employers protected under the Act from being pressured to enter prehire agreements with minority unions?

2. How are employees protected from the effects of a prehire agreement in which a minority union is allowed to reach an agreement with the employer?


Board.25 A complaint may issue if the violation continues. In addition to the usual cease-and-desist orders, the Board may also obtain from a court a temporary restraining order against jurisdictional or work assignment unfair activity prior to issuing its complaint. Thus, a neutral employer and the public should receive prompt relief from a jurisdictional struggle between unions.

Such strife may continue over long periods, however, when two unions are contesting each other’s right. For example, in one case, the respondent union con- tended that the case was moot because the work had been completed before any restraining order was issued. The court found grounds, however, to believe that the dispute would be renewed on future jobs. Although the parties had agreed on voluntary methods of adjustment, the court of appeals upheld the Board’s authority to resolve the matter by a cease-and-desist order.26

Interesting questions arise as to the purpose of union activity when both unlawful and also protected objectives are said to be present. The picketing respon- dent union may claim its sole aim to be consumer or public information, while the Board may believe work reassignment to be the objective. If any basis exists for the latter conclusion, even though multiple objectives are present, the Board will pro- ceed under the Section 8(b)(4)(D) provision, and the courts agree to this.

In making work assignment determinations, the criteria used include past prac- tice and customs, existing contracts, efficiency and economy of operations, previous certification of bargaining units, or other significant considerations. Usually several significant considerations may be in conflict, the problem then being to decide which will have the controlling weight. The courts do not upset the NLRB judg- ments in such matters.

After a charge is filed under Section 8(b)(4)(D), Section 10(k) then requires the Board to hold a hearing to resolve the jurisdictional dispute unless “the parties to such dispute” adjust or agree upon a method for the voluntary adjustment of the dispute. Ever since Section 10(k) was enacted, the Board has consistently inter- preted the phrase “parties to such dispute” to include the employer as well as the disputing unions. The Board has refused to dismiss Section 10(k) proceedings when the unions, but not the employer, have agreed to settle. In the NLRB v. Plas- terers’ Local 79 decision,27 the Supreme Court upheld the Board’s interpretation and reversed the District of Columbia Circuit’s decision that an employer had no right to insist upon participation in a Section 10(k) proceeding.

In NLRB v. Local 825, Operating Engineers (Burns and Roe),28 the Supreme Court determined that a strike against neutral employers, with the object of forcing a change in a work assignment by the primary employer, amounted to coercion to “cease doing business” with the primary employer in violation of Section 8(b)(4)(B). Strikes to force assignment of work thus can violate both Section 8(b)(4)(D) and Section 8(b)(4)(B).

25 Laborers International Union, Local 113, and Super Excavators, Inc., 327 NLRB 113 (1998). 26 Douds v. Local Union No. 46, Wood, Wire, and Metal Lathers International Ass’n, 245 F.2d 223 (3d Cir. 1957). 27 404 U.S. 116 (1971). 28 400 U.S. 297 (1971).



The thrust of Section 8(b)(4)(ii)(B), the principal secondary boycott section of the Act, is to protect neutral employers from the effects of labor disputes between other employers and their employees. This protection has been limited by rulings that have recognized the right of striking employees, under certain circumstances, to picket “allies” of their employer, to picket common situs locations where neutral as well as primary employer activity is present, and (again under certain circum- stances) to conduct secondary consumer boycotts.


In NLRB v. Denver Building & Construction Trades Council,29 the Supreme Court stated that Section 8(b)(4) reflects “the dual congressional objectives of preserving the right of labor organizations to bring pressure to bear on offending employers in primary labor disputes and of shielding unoffending employers and others from pres- sures and controversies not their own.” This policy then protects unoffending or innocent third parties from labor disputes that are not their affair. Under the so- called ally doctrine, an employer who performs the “struck work” of a primary employer is no such innocent party and is not protected under Section 8(b)(4).30

The ally doctrine is also applied to those employers who, because of common owner- ship, control, and integration of operations, become so identified with the primary employer that the businesses are considered a single enterprise.


The line between legitimate primary and unlawful secondary activity is relatively easy to draw when the primary and secondary employers have separate work sites. A more difficult problem is presented in the common situs cases in which both the struck or primary employer and the secondary or neutral employer are carrying on business activities at the same location. In the Moore Dry Dock Co. case,31 in which a union that had a dispute with a shipowner was refused permission to enter a shipyard to picket alongside the ship and thus set up a picket line at the entrance to the secondary employer’s shipyard, the Board set forth standards outlining the types of picketing permissible in common situs situations. The Board ruled that picketing is primary and beyond the scope of Section 8(b)(4) when the following take place:

1. The picketing is strictly limited to times when the common situs of the dispute is located on the secondary employer’s premises.

2. At the time of picketing, the primary employer is engaged in its normal busi- ness at the situs.

29 341 U.S. 675 (1951). 30 Douds v. Metropolitan Federation, 75 F. Supp. 672 (S.D.N.Y. 1948). 31 Sailors Union of the Pacific (Moore Dry Dock Co.), 92 NLRB 547 (1950). See also OCAW Local 1-591 and BN Railroad, 325 NLRB 45 (1998).


3. The picketing is limited to places reasonably close to the location of the situs. 4. The picketing discloses clearly that the dispute is with the primary employer.

A company may reserve a certain plant gate or entrance to its premises for the exclusive use of an outside contractor. If a union has a labor dispute with the company and pickets the company’s premises, including the gate so reserved for the employees of the outside contractor, the union may be held to have violated Section 8(b)(4)(B). The Supreme Court has stated the circumstances under which such a violation may be found as follows:

There must be a separate gate, marked and set apart from other gates; the work done by the employees who use the gate must be unrelated to the normal operations of the employer, and the work must be of a kind that would not, if done when the plant were engaged in its regular operations, necessitate curtailing those operations.32

However, if the reserved gate is used by employees of both the company and the contractor, the picketing would be considered primary and not a violation of Section 8(b)(4)(B).

The Wilhelm Construction Co. case, presented in this section, involves a violation of Section 8(b)(4) of the NLRA in a “reserve gate” context.


[The Carpenters Union, representing union carpen- ters in the Louisville, Kentucky, area, unsuccessfully sought to have Dant Clayton Co. and Dailey Seating Co. enter into collective bargaining contracts with the carpenters union. Dailey had a subcontract to install the seating for the construction of the Uni- versity of Louisville’s new stadium. F. A. Wilhelm Construction Co., Inc., had the contract for the con- struction of a portion of the stadium’s concrete superstructure and employed union carpenters on this project and was subject to a collective bargaining contract with the union that contained a no-strike clause. Dailey Seating Co. employed a nonunion workforce. On December 4, 1997, the union told Dailey that a picket line would be established against it the following morning. Union representatives walked around the project that day advising all

union members, including Wilhelm workers, that picketing would begin against Dailey the following day, and they requested volunteers to staff the picket line. A union wallet card was distributed stating on one side “GOOD UNION BUILDING TRADESMEN do not work behind banners even with 4 gates.” The other side read:

Which side are you on? Picketing has been described by the Supreme Court as the “working man’s means of communication.” A picket is a message to you that some of your fellow workers are engaged in a labor dispute and need your help. It is your constitutional right as an Ameri- can citizen to decide how you will respond to that picket. Under the law your union cannot help you make that decision. You can seek


32 United Steelworkers v. NLRB & Carrier Corp., 376 U.S. 492 (1964). See also Local 7, SMWIA, 345 NLRB No. 119 (2004).


guidance only from your conscience then decide, “Which side am I on?”

In response to the union’s activities, the project manager set up a “reserve gate system.” When Dailey Seating Company’s name appeared on the reserved gate, other jobsite workers from the construction trades went to work for their respective contractors or subcontractors utilizing the other entrances to the project while the carpenters union picketed Gate 1, the reserved gate for Dailey’s workers. When the leader of the National Carpenters Union wrote a letter to the local union advising that the strike was improperly affecting Wilhelm Construction Co., a union contractor with a no-strike clause, the union ceased picketing at the job-site and the carpenters went back to work for Wilhelm. Wilhelm Construc- tion Co. sued the carpenters union under Section 303 of the NLRA for damages resulting from an illegal secondary boycott arising from a violation of Section 8(b)(4) of the NLRA. From a judgment for Wilhelm the parties cross-appealed.]

MERRITT, C. J.… The establishment of a reserved gate system is common in the construction industry, particularly where numer- ous employers work at a site but only one employer is experiencing labor unrest. Under a reserve gate system, one gate, or entrance, called the “primary” gate, is reserved for the exclusive use of the “primary” contrac- tor that is the target of the picket line, as well as its subcontractors, vendors and guests; other gates or entrances are reserved for use by contractors and others not involved in the dispute. Generally, once a reserved gate system is in place, the union must confine its pick- eting to the primary gate. The system is designed to keep neutral parties out of the dispute and avoid the need for them to cross picket lines. Reserve gate systems are usually effective because unions confine their pick- eting to the gate reserved for the targeted contractor and the project is not shut down….

Under the Act, when a union has a problemwith the “primary” employer, it must focus its activities on that employer only. It may not exert pressure, whether direct or indirect, on other neutral or unrelated “secondary” employers. Encouraging employees to engage in a concerted activity against their employer in order to have that employer refuse to deal with the primary employer is illegal. The question is a factual

one as to the union’s intent. Accordingly, in determin- ing whether a union has violated Section 8(b)(4), the court must decide if the union’s actions were directed at the secondary employer or merely had ancillary con- sequences for that employer. It is not necessary that the sole object of the strike be focused on the secondary employer if one of the union’s objectives was to influ- ence the secondary employer to bring pressure to bear on the primary employer.Whether the unionwasmoti- vated by a secondary objective is a question of fact and is to be determined by the totality of the union’s con- duct under the circumstances.

The question for the district court, therefore, was one of intent. The district court concluded, and we agree, that representatives of the union violated Section 8(b)(4) when they explicitly enlisted advance help from Wilhelm employees to form a picket line against Dailey. The direct solicitation by defendant of Wilhelm’s union employees before any picket line had been established demonstrates that defendant’s likely objective was to keep Wilhelm employees off the job. A reasonable inference from the evidence demonstrates that defendant intended to embroil Wilhelm in its labor dispute against Dailey by recruit- ing Wilhelm workers to staff the picket lines in advance of the creation of the picket….

Section 303 of the National Labor Relations Act provides a private cause of action for damages arising from a violation of Section 8(b)(4). The district court awarded Wilhelm $44,547.76 in damages….

Once liability is established, Wilhelm is entitled to recover all damages, “directly and proximately” caused from the violations from the Act by the union…

[The matter was remanded to the district court for calculation of damages according to the direction of the Court of Appeals.]

Case Questions

1. Did the reserve gate system work as intended in this case?

2. Does the plaintiff in a Section 303 lawsuit for damages arising from a violation of Section 8(b)(4) of theNLRA have to prove that the union’s actions were directed at the secondary employer?

3. What evidence exists that the carpenters union intended to exert pressure on the neutral or secondary employer in this case, Wilhelm Construction Co.?



The terms picketing, handbilling, and bannering are often associated with second- ary boycott litigation. The Tree Fruits, Safeco Title Insurance, and DeBartolo II Supreme Court precedents provide developing guidance for the murky statutory language of Section 8(b)(4) of the NLRA.


The “publicity proviso” to Secion 8(b)(4) states that:

nothing contained in such paragraph shall be construed to prohibit publicity, other than picketing, for the purpose of truthfully advising the public, including consumers and members of a labor organization, that a product or products are produced by an employer with whom the labor organization has a primary dispute and are distributed by another employer, as long as such publicity does not have an effect of inducing any individual employed by any person other than the primary employer in the course of his employment to refuse to pick up, deliver, or transport any goods, or not to perform any services, at the establishment of the employer engaged in such distribution….

A union thus has the right to publicize a dispute with a primary employer at retail establishments that sell the goods of the primary employer. Truthful hand- bills, billboards, newspaper advertisements, and radio and television messages are all clearly protected. Despite the “other than picketing” language of the publicity proviso, the Supreme Court held in Tree Fruits that consumer picketing limited to asking customers not to purchase the struck product at the neutral employer’s store is legal. When the purpose of the picketing is to cut off all trade with the neutral employer, it is a Section 8(b)(4)(ii)(B) violation. The Tree Fruits decision is presented in this section.

In the Safeco Title Insurance decision, also presented in this section, a union’s secondary picketing against the central product sold by neutral employers—title insurance—was held to be a violation of the language and purpose of Section 8(b) (4)(ii)(B) because it was reasonably calculated to induce customers not to patronize the neutral employers at all.


In DeBartolo II, presented in this section, a union distributed handbills at all entrances to a Tampa, Florida, shopping mall, urging a total consumer boycott of all 85 stores in the mall even though the union had a labor dispute with only one building contractor hired to build a single store at the mall. The Supreme Court found that peaceful handbilling unaccompanied by picketing that urged a consumer boycott of the neutral employers was not a violation of Section 8(b)(4) of the NLRA. The Court pointed out in DeBartolo II that picketing is “a mixture of conduct and communication and the conduct often provides the most persuasive deterrent to third persons about to enter a business establishment,” whereas hand- bills “depend entirely on the persuasive force of the idea.” The Court thus avoided a serious First Amendment free speech issue, in that handbilling lacked the characteristics


of picketing that often proves to be threatening or coercive conduct within the meaning of §8(b)4(ii)(B).

In NLRB v. Servette, Inc.,33 union representatives contacted managers of supermarkets, advised them that they were engaged in a strike against Servette, and requested that they discontinue handling merchandise supplied by Servette. The union representatives also warned that handbills asking the public not to buy Servette products would be passed out in front of those stores that refused to coop- erate. The court found that warnings threatening distribution of handbills were not “threats” within the meaning of Section 8(b)(4)(ii), reasoning that the statutory protection for the distribution of handbills would be undermined if a threat to engage in protected conduct were not itself protected.


In Overstreet v. Carpenters Local 1506, the General Counsel sought injunctive relief under Section 10(1) of the Act because of the display of banners at a sec- ondary site.34 The Ninth Circuit refused to enjoin the union’s use of large 4-foot � 15-foot banners near the neutral employers’ premises that proclaimed “SHAME ON [name of neutral retailer]” and “Labor Dispute” in smaller letters in the corners of the banners. The banners were placed a good distance away from the jobsite, and none of the entrances to the retailers were blocked. The Court rejected the General Counsel’s argument that the banners constituted coer- cion under Section 8(b)(4)(ii)(B) because it was tantamount to “signal” picketing. Rather, applying DeBartolo II, the Court concluded that the banners were speech protected by the First Amendment, similar to handbills, and were truthful state- ments of the union’s issue with the secondary employers. Thereafter the matter was heard before the full Board in Carpenters Local 1506 (Eliason & Knuth of Arizona, Inc.),35 and the Board majority determined that the display of a station- ary banner, like handbilling, is noncoercive and thus falls outside the proscription in Section 8(b)(4)(ii)(B). The majority stated:

The core conduct that renders picketing coercive under Section 8(b)(4)(ii)(B) is not simply the holding of signs (in contrast to the distribution of handbills), but the combination of carrying of picket signs and persistent patrolling of the picketers back and forth in front of an entrance to a work site, creating a physical or, at least, a symbolic confrontation between the picketers and those entering the worksite.

The Board majority found that the banner displays did not constitute proscribed picketing, because they did not create a confrontation. The Board stated:

Banners are not picket signs. Furthermore, the union representatives held the banners stationary, without any form of patrolling. Nor did the union representatives hold the banner in front of any entrance to a secondary site in a manner such that anyone entering the site had to pass between the union representatives. The banners were

33 377 U.S. 46 (1964). 34 409 F.3d 1199 (9th Cir. 2005). 35 189 NLRB 1041 (2011).


located at a sufficient distance from the entrances so that anyone wishing to enter or exit the sites could to do so without confronting the banner holders in any way.

Referencing the distinction between “picketing” and “handbilling” set forth in DeBartolo II, the dissenting members asserted that the size and placement of the banners and the stationing of union agents to hold them are direct similarities to picketing and contribute to the confrontational impact of bannering, sharply distin- guishing that conduct from handbilling’s mere persuasion.

In Sheet Metal Workers Local 15 (Brandon Medical Center),36 the Board majority followed its Eliason & Knuth precedent and concluded that the union’s conduct in inflating a 16-foot-tall rat balloon displaying a banner near a medical center to protest nonunion labor on a construction project was not picketing or coercion prohibited by Section 8(b)(4)(ii)(B). The dissent stated that in the abstract, the display of a gigantic inflated rat might seem more comical than coercive, but the use of the rat balloon was tantamount to picketing.


BRENNAN, J.… Under Section 8(b)(4)(ii)(B) of the National Labor Relations Act, as amended, it is an unfair labor practice for a union “to threaten, coerce, or restrain any person,” with the object of “forcing or requiring any person to cease using, selling, handling, trans- porting, or otherwise dealing in the products of any other producer … or to cease doing business with any other person….” A proviso excepts, however,

publicity, other than picketing, for the purpose of truthfully advising the public … that a product or products are produced by any employer with whom the labor organization has a primary dis- pute and are distributed by another employer, as long as such publicity does not have an effect of inducing any individual employed by any person other than the primary employer in the course of his employment to refuse to pick up, deliver, or transport any goods, or not to perform any services, at the establishment of the employer engaged in such distribution.

The question in this case is whether the respondent unions violated this section when they limited their secondary picketing of retail stores to an appeal to

the customers of the stores not to buy the products of certain firms against which one of the respondents was on strike.

Respondent Local 760 called a strike against fruit packers and warehousemen doing business in Yakima, Washington. The struck firms sold Washington State apples to the Safeway chain of retail stores in and about Seattle, Washington. Local 760, aided by respon- dent Joint Council, instituted a customer boycott against the apples in support of the strike. They placed pickets who walked back and forth before the custo- mers’ entrances of 46 Safeway stores in Seattle. The pickets—two at each of 45 stores and three at the 46th store—wore placards and distributed handbills which appealed to Safeway customers, and to the public generally, to refrain from buying Washington State apples, which were only one of numerous food products sold in the stores. Before the pickets appeared at any store, a letter was delivered to the store manager informing him that the picketing was only an appeal to his customers not to buy Washington State apples, and that the pickets were being expressly instructed “to patrol peacefully in front of the customer entrances of the store, to stay away from delivery entrances and not to interfere with the work of your employees, or

36 356 NLRB No. 162 (May 26, 2011).



with deliveries to or pickups from your store.” A copy of written instructions to the pickets—which included the explicit statement that “you are also forbidden to request that the customers not patronize the store”— was enclosed with the letter. Since it was desired to assure Safeway employees that they were not to cease work, and to avoid any interference with pickups or deliveries, the pickets appeared after the stores opened for business and departed before the stores closed. At all times during the picketing, the store employees contin- ued to work, and no deliveries or pickups were obstructed. Washington State apples were handled in normal course by both Safeway employees and the employees of other employers involved. Ingress and egress by customers was not interfered with in any manner.

A complaint issued on charges that this conduct violated Section 8(b)(4) as amended. The case was submitted directly to the National Labor Relations Board on a stipulation of facts and the waiver of a hearing and proceedings before a Trial Examiner. The Board held, following its construction of the statute in Upholsterers Frame & Bedding Workers Twin City Local No. 61, 132 NLRB 40, that “by literal wording of the proviso [to Section 8(b)(4)] as well as through the interpretative gloss placed thereon by its drafters, consumer picketing in front of a secondary establishment is prohibited.” 132 NLRB 1172, 1176. Upon respondents’ petition for review and the Board’s cross-petition for enforce- ment, the Court of Appeals for the District of Columbia Circuit set aside the Board’s order…. We granted certiorari, 374 U.S. 804….

We have examined the legislative history of the amendments to Section 8(b)(4)….

No Conference Report was before the Senate when it passed the compromise bill, and it had the benefit only of Senator [John] Kennedy’s statement of the purpose of the proviso. He said the proviso preserved

the right to appeal to consumers by methods other than picketing asking them to refrain from buying goods made by nonunion labor and to refrain from trading with a retailer who sells such goods…. We were not able to persuade the House conferees to permit picketing in front of that secondary shop, but were able to persuade them to agree that the union shall be free to conduct informational activity short of picketing. In other words, the union can hand out handbills

at the shop … and can carry on all publicity short of having ambulatory picketing….

This explanationdoesnot compel the conclusion that the Conference Agreement contemplated prohibiting any consumer picketing at a secondary site beyond that which urges the public, in Senator Kennedy’s words, to “refrain from trading with a retailer who sells such goods.” To read into the Conference Agree- ment, on the basis of a single statement, an intention to prohibit all consumer picketing at a secondary site would depart from our practice of respecting the con- gressional policy not to prohibit peaceful picketing except to curb “isolated evils” spelled out by the Congress itself.

Peaceful consumer picketing to shut off all trade with the secondary employer unless he aids the union in its dispute with the primary employer, is poles apart from such picketing which only per- suades his customers not to buy the struck product. The proviso indicates that no more than the Senate conferees’ constitutional doubts led Congress to authorize publicity other than picketing which per- suades the customers of a secondary employer to stop all trading with him, but not such publicity which has the effect of cutting off his deliveries or inducing his employees to cease work. On the other hand, picketing which persuades the customers of a secondary employer to stop all trading with him was also to be barred.

In sum, the legislative history does not support the Board’s finding that Congress meant to prohibit all consumer picketing at a secondary site, having deter- mined that such picketing necessarily threatened, coerced, or restrained the secondary employer. Rather, the history shows that Congress was follow- ing its usual practice of legislating against peaceful picketing only to curb “isolated evils.”

This distinction is opposed as “unrealistic” because, it is urged, all picketing automatically pro- vokes the public to stay away from the picketed establishment. The public will, it is said, neither read the signs and handbills, nor note the explicit injunctions that “This is not a strike against any store or market.” Be that as it may, our holding today simply takes note of the fact that a broad con- demnation of peaceful picketing, such as that urged upon us by petitioners, has never been adopted by Congress, and an intention to do so is not revealed with that “clearest indication in the legislative his- tory,” which we require.



We come then to the question whether the picket- ing in this case, confined as it was to persuading cus- tomers to cease buying the product of the primary employer, falls within the area of secondary consumer picketing which Congress did clearly indicate its intention to prohibit under Section 8(b)(4)(ii). We hold that it did not fall within that area, and therefore did not “threaten, coerce, or restrain” Safeway. While any diminution in Safeway’s purchases of apples due to a drop in consumer demand might be said to be a result which causes respondents’ picketing to fall literally within the letter of the statute and yet not within the statute, because not within its spirit, nor within the intentions of its makers. When consumer picketing is employed only to persuade customers not to buy the struck product, the union’s appeal is closely confined to the primary dispute. The site of the appeal is expanded to include the premises of the secondary employer, but if the appeal succeeds, the secondary employer’s purchases from the struck firm are decreased only because the public had dimin- ished its purchases of the struck product. On the other hand, when consumer picketing is employed to persuade customers not to trade at all with the secondary employer, the latter stops buying the struck product, not because of a falling demand, but in response to pressure designed to inflict injury on his

business generally. In such case, the union does more than merely follow the struck product; it creates a separate dispute with the secondary employer.

We disagree thereforewith the Court of Appeals that the test of “to threaten, coerce, or restrain” for the pur- poses of this case is whether Safeway suffered or was likely to suffer economic loss. A violation of Section 8 (b)(4)(ii)(B) would not be established merely because respondents’ picketing was effective to reduce Safeway’s sales of Washington State apples, even if this led or might lead Safeway to drop the item as a poor seller.

The judgment of the Court of Appeals is vacated and the case is remanded with direction to enter judg- ment setting aside the Board’s order.

It is so ordered.

Case Questions

1. What was the union conduct complained of by Safeway stores?

2. On what grounds did the NLRB prohibit the picketing?

3. How does the Supreme Court view the legality of this boycott?

4. Is peaceful secondary activity against one prod- uct of a multiproduct retailer prohibited by the NLRA, according to the Tree Fruits decision?


[Safeco Title Insurance Co. underwrites real estate title insurance in the state of Washington. It maintains close business relationships with five local title compa- nies. These local title companies search land titles, perform escrow service, and sell title insurance; and more than 90 percent of their gross income derives from the sale of Safeco insurance. Local 1001 of the Retail Store Employees Union became the certified bargaining representative for certain Safeco employees in 1974. When contract negotiations between Safeco and the union reached an impasse, the employees went on strike. The union picketed Safeco’s office in Seattle, and it also picketed each of the five local

title companies. The pickets carried signs declaring that Safeco had no contract with the union. A typical sign read:

Safeco Nonunion Does not Employ Members of or Have Contract with Retail Store Employees Local 1001

Union members also distributed handbills advis- ing the public of the strike and asking consumers to support the strike by canceling their Safeco policies. Safeco and one of the title companies filed com- plaints with the NLRB charging that the union had engaged in an unfair labor practice by picketing in



order to promote a secondary boycott against the title companies. No issue was raised concerning the distribution of handbills. The Board concluded that the union’s picketing violated Section 8(b)(4)(ii)(B) of the NLRA. The U.S. Court of Appeals for the District of Columbia Circuit set aside the Board’s order, holding that Tree Fruits leaves neutrals sus- ceptible to whatever consequences may flow from secondary picketing against the consumption of pro- ducts of an employer involved in a labor dispute. The Supreme Court granted a writ of certiorari.]

POWELL, J.… The question is whether § 8(b)(4)(ii)(B) of the National Labor Relations Act forbids secondary pick- eting against a struck product when such picketing predictably encourages consumers to boycott a neu- tral party’s business….

… The product picketed in Tree Fruits was but one item among the many that made up the retailer’s trade. If the appeal against such a product succeeds, the Court observed, it simply induces the neutral retailer to reduce his orders for the product or “to drop the item as a poor seller.” The decline in sales attributable to consumer rejection of the struck product puts pres- sure upon the primary employer, and the marginal injury to the neutral retailer is purely incidental to the product boycott. The neutral therefore has little reason to become involved in the labor dispute. In this case, on the other hand, the title companies sell only the primary employer’s product and perform the services associated with it. Secondary picketing against con- sumption of the primary product leaves responsive consumers no realistic option other than to boycott the title companies altogether. If the appeal succeeds,

each company “stops buying the struck product, not because of a falling demand, but in response to pres- sure designed to inflict injury on [its] business generally.” Thus, “the union does more than merely follow the struck product; it creates a separate dispute with the secondary employer.” Such an expansion of labor discord was one of the evils that Congress intended § 8(b)(4)(ii)(B) to prevent….

As long as secondary picketing only discourages consumption of a struck product, incidental injury to the neutral is a natural consequence of an effective pri- mary boycott. But the Union’s secondary appeal against the central product sold by the title companies in this case is “reasonably calculated to induce customers not to patronize the neutrals at all.” The resulting injury to their business is distinctly different from the injury that the Court considered in Tree Fruits. Product picketing that reasonably can be expected to threaten neutral par- ties with ruin or substantial loss simply does not square with the language or the purpose of § 8(b)(4)(ii)(B).…

The judgment of the Court of Appeals is reversed and the case is remanded with directions to enforce the National Labor Relations Board’s order.

So ordered.

Case Questions

1. Was the union’s distribution of handbills a violation of Section 8(b)(4)(ii)(B) of the NLRA?

2. State the rule of the case. 3. Compare the impact on neutral employers of

responsive consumer action in the Tree Fruits case with that in the Safeco case.

4. Does the Safeco decision modify the Tree Fruits decision?


[The Supreme Court in DeBartolo I remanded the case to the Board. On remand, the Board held that the hand-billing violated Section 8(b)(4)(ii)(B), which forbids a union to “threaten, coerce, or restrain” any person when an object is to force the person to cease doing business with another person. Because it had serious doubts about Section 8(b)(4)’s constitutionality

under the Board’s interpretation, the court of appeals applied NLRB v. Catholic Bishop of Chicago, 440 U.S. 490, and ruled that neither the statute’s language nor its legislative history revealed a clear congressional intent to proscribe such handbilling. The court thus denied enforcement of the Board’s order. The Supreme Court granted certiorari.]



WHITE, J.… This case centers around the respondent union’s peaceful handbilling of the businesses operating in a shopping mall in Tampa, Florida, owned by petitioner, the Edward J. DeBartolo Corporation (DeBartolo). The union’s primary labor dispute was with H. J. High Construction Company (High) over alleged substandard wages and fringe benefits. High was retained by the Wilson Company (Wilson) to construct a department store in the mall, and neither DeBartolo nor any of the other 85 or so mall tenants had any contractual right to influence the selection of contractors.

The union, however, sought to obtain their influ- ence upon Wilson and High by distributing hand- bills asking mall customers not to shop at any of the stores in the mall “until the Mall’s owner pub- licly promises that all construction at the Mall will be done using contractors who pay their employees fair wages and fringe benefits.” The handbills’ mes- sage was that “[t]he payment of substandard wages not only diminishes the working person’s ability to purchase with earned, rather than borrowed, dol- lars, but it also undercuts the wage standard of the entire community.” The handbills made clear that the union was seeking only a consumer boycott against the other mall tenants, not a secondary strike by their employees. At all four entrances to the mall for about three weeks in December 1979, the union peacefully distributed the handbills with- out any accompanying picketing or patrolling….

… [W]here an otherwise acceptable construction of a statute would raise serious constitutional pro- blems, the Court will construe the statute to avoid such problems unless such construction is plainly con- trary to the intent of Congress. Catholic Bishop, supra. at 499–501, 504….

[We] conclude, as did the Court of Appeals, that [§ 8(b)(4)] is open to a construction that obviates deciding whether a congressional prohibition of hand-billing on the facts of this case would violate the First Amendment.

The case turns on whether handbilling such as involved here must be held to “threaten, coerce, or restrain any person” to cease doing business with another, within the meaning of § 8(b)(4)(ii)(B)….

The Board… found that the handbilling “coerced” mall tenants and explained in a footnote that “[a]ppealing to the public not to patronize secondary

employers is an attempt to inflict economic harm on the secondary employers by causing them to lose business. As the case law makes clear, such appeals constitute ‘economic retaliation’ and are therefore a form of coercion.” 273 N.L.R.B., at 1432, n. 6. Our decision in Tree Fruits, however, makes untenable the notion that any kind of handbilling, picketing, or other appeals to a secondary employer to cease doing business with the employer involved in the labor dispute is “coercion” within the meaning of § 8(b)(4)(ii) (B) if it has some economic impact on the neutral….

NLRB v. Retail Store Employees, 447 U.S. 607 (1980) (Safeco), in turn, held that consumer picket- ing urging a general boycott of a secondary employer aimed at causing him to sever relations with the union’s real antagonist was coercive and forbidden by § 8(b)(4). It is urged that Safeco rules this case because the union sought a general boycott of all tenants in the mall. But “picketing is qualitatively ‘different from other modes of communication.’” Babbitt v. Farm Workers, 442 U.S. 289, 311, n. 17 (1979), (quoting Hughes v. Superior Court, 339 U.S. 460, 465 (1950)), and Safeco noted that the picketing there actually threat- ened the neutral with ruin or substantial loss. As Justice Stevens pointed out in his concurrence in Safeco, supra, at 619, picketing is “a mixture of conduct and communication” and the conduct element “often provides the most persuasive deter- rent to third persons about to enter a business establishment.” Handbills containing the same mes- sage, he observed, are “much less effective than labor picketing” because they “depend entirely on the persuasive force of the idea.” Ibid. Similarly, the Court stated in Hughes v. Superior Court, supra, at 465:

Publication in a newspaper, or by distribution of circulars, may convey the same information or make the same charge as do those patrolling a picket line. But the very purpose of a picket line is to exert influences, and it produces conse- quences, different from other modes of communication.

In Tree Fruits, we could not discern with the “requi- site clarity” that Congress intended to proscribe all peaceful consumer picketing at secondary sites. There is even less reason to find in the language




After Section 8(b)(4) was enacted to make illegal secondary economic activity for the purpose of compelling one employer to cease doing any business with another person, the problem of contracts providing for such results remained. In 1959, Section 8(e), the so-called hot cargo section of the Act, was added. This section prohibits collective bargaining agreements whereby members of the contracting bargaining unit need not handle nonunion or struck goods of other employers; it also prohibits contracts whereby the employer ceases to do business with any person. The Newspaper Deliverers Union and the New York Post’s collective bar- gaining contract, which provides that the Post “shall not distribute its newspaper … through any wholesaler unless such wholesaler is under written collective agree- ment with the Union,” was held to be an unenforceable “hot cargo” provision by the Labor Board. The Board pointed out that the union’s attempt to obtain the dis- tribution work on Long Island for the employees of a union signatory employer rather than nonunion wholesalers was contrary to Section 8(e) and also a violation of Section 8(b)(4).37

Explicit exceptions to the prohibitions of Section 8(e) were made for two industries, garment manufacturing and building construction, where subcontracting commonly is practiced under the contractual requirements that only unionized shops will be used.

The United Rentals case, presented in this section, is an example of a collective bargaining agreement clause protected by the Section 8(e) exception for workers at construction sites, which forbids the signatory contractors from subcontracting work at their construction site to any firm that has not signed a collective bargain- ing agreement with the Laborers Union.

of § 8(b)(4) (ii), standing alone, any clear indication that handbilling, without picketing, “coerces” secondary employers. The loss of customers because they read a handbill urging them not to patronize a business, and not because they are intimidated by a line of picketers, is the result of mere persuasion, and the neutral who reacts is doing no more than what its customers hon- estly want it to do….

In our view, interpreting § 8(b)(4) as not reaching the handbilling involved in this case is not foreclosed either by the language of the section or its legislative history. That construction makes unnecessary passing on the serious constructional questions that would be raised by the Board’s understanding of the statute. Accordingly, the judgment of the Court of Appeals is


Case Questions

1. Why didn’t the Supreme Court give its usual deference to the Board’s interpretation of the statute in this case?

2. Is picketing qualitatively different from handbilling?

3. Did the Court conclude that the handbilling in this case had a coercive effect on the secondary employers?

4. Assume that the Bakery Workers’ Union is on strike against a bakery whose products are sold at a local supermarket. Compare the action the union may take against the local supermarket under Tree Fruits and DeBartolo II.

37 Newspaper and Mail Deliverers’ Union of N.Y., 337 NLRB No. 91 (2002).


The construction industry proviso to Section 8(e) has been interpreted to allow unions in this industry to use economic pressures to secure hot cargo sub- contracting clauses limited to work to be done at the site of the construction. The Board and the courts, however, have held that it is not legal for unions to use any economic pressure to enforce such clauses.38 The union’s recourse is to bring a Section 301 lawsuit.

A union may, under certain circumstances, use economic pressure to enforce a work preservation clause. In the National Woodwork decision, reported in this sec- tion, the Court held that it is not a Section 8(b)(4)(B) violation for a union to picket its immediate employer for the purpose of preserving work traditionally per- formed by union members that the employer is in a position to award, even if it might cause the employer to terminate contractual relations with another employer. In NLRB v. Pipefitters Local 638,39 however, the Supreme Court held that it was a Section 8(b)(4)(B) violation for a union to undertake economic activity against its immediate employer, a plumbing and pipe fitting contractor, when that employer was not in a position to award the work. In Pipefitters, the subcontractor’s employees refused to install climate control units where the internal piping of the units was performed at the factory according to the general contractor’s job specifi- cations. This work traditionally had been performed by union members at various construction sites. Although the labor agreement between the subcontractor and the union contained a valid work preservation clause, the Court found the activity in question secondary in nature because the subcontractor lacked the “right of con- trol” over the choice of materials to be used. The Court reasoned that the union activity was a secondary boycott because it had the effect of unlawfully pressuring the subcontractor to “cease doing business” with the general contractor. In the cir- cumstances of National Woodwork, the “cease doing business” consequences were incidental to the primary activity, whereas in Pipefitters, the union, if it was to obtain the work, must have intended to exert pressure on another employer.

Garment industry unions were treated more favorably by Congress than con- struction industry unions and may use economic pressure to obtain and enforce hot cargo clauses in their collective bargaining agreements.


[United Rentals is in the “traffic control” segment of the highway construction market. The firms in this market help to protect highway construction workers from being hit by vehicles using the stretch of the

highway that the workers are building, repairing, or rebuilding. When construction activity is about to begin, employees of the traffic control firm place cones, barrels, concrete blocks, or other barricades


38 See NLRB v. IBEW, Local 769, 405 F.2d 159 (9th Cir. 1968). 39 429 U.S. 507 (1977).


in position to block or alter traffic lanes. The workers also paint stripes on the road to indicate the new lanes, install warning signs to guide dri- vers using the highway, and place guardrails to keep vehicles from veering off onto what may be a nonexistent shoulder. The traffic control firm owns and stores the barricades, signs, guardrails, and other safety devices and brings them to the construction site as needed. The firm installs its devices before construction begins and removes them when it is finished. If flaggers are required, they may be supplied by the traffic control firm or by the general contractor.

Road work in Indiana is done almost entirely by contractors who belong to a trade association called Indiana Constructors, which has for many years negotiated collective bargaining agreements for its members with the Laborers International Union. In 2004, the collective bargaining agreement in force was modified to forbid the association’s members to subcontract work at a construction site to a firm that had not signed a collective bargaining agreement with the Laborers Union. This was a blow to United Ren- tals because it had a collective bargaining agreement with another union. Also, it did not want to bargain with the Laborers Union when that agreement expired. It filed a charge with the NLRB that Indiana Constructors and the Laborers Union were violating the NLRB’s hot cargo provision. Section 8(e) of the provision forbids a union and an employer to agree that the employer will refuse to deal with another employer, as Indiana Constructors had agreed with the Laborers Union to do with respect to United Ren- tals. The Board’s General Counsel declined to file a complaint, and United Rentals brought suit against the union in federal court under Section 303 of the Taft Hartley Act, which forbids a union to enter an agreement prohibited by the hot cargo provision. The federal district court granted summary judgement in favor of the union, and United Rentals appealed.]

POSNER, C. J.… Before Congress enacted the hot cargo provision, along with its exception for the construction indus- try, in 1959, hot cargo clauses had been pervasive in the industry, had been upheld repeatedly as lawful, and had not caused the problems associated with closed shops—though one reason, inapplicable to

this case, was that most construction workers are hired from hiring halls; the halls are operated by unions but the unions are required to refer all comers, and not just workers represented by a union, to contractors and subcontractors, Woelke & Romero Framing, Inc., v. NLRB, 456 U.S. 645, 664-65 (1982); Lucas v. NLRB, 333 F.3d 927, 932 (9th Cir. 2003).

So one reason for the construction-industry excep- tion was just a desire to ratify an acceptable status quo…. But another was to prevent friction at con- struction jobsites…. More than just work stoppages were at stake. Much construction work is dangerous, including road construction in the presence of high- way traffic; and there was concern that the frictions engendered by union workers working side by side at a construction job site with nonunion workers or workers belonging to another union would reduce safety as well as efficiency. Woelke & Romero Fram- ing, Inc., v. NLRB, supra, 456 U.S. at 662.

Before there was a separate market in traffic con- trol there was no impediment to the general contrac- tor’s requiring whatever subcontractor performed traffic control for the contractor to bargain collec- tively with the general contractor’s union. For a time after traffic control broke off and became a sep- arate business, general contractors and construction workers’ unions did not insist that the employees of traffic control subcontractors be represented by the general contractor’s union, though even in that tran- sitional period the collective bargaining agreement between the Indiana Constructors and the Laborers Union said that the union “encourages its members to utilize subcontractors who are signatory to collec- tive bargaining agreements with the Laborers Union. Such subcontractors help to promote peace and harmony of the jobsite and to avoid labor dispute interruption of work.” The modification in the collective bargaining agreement of which United Rentals complains restores fully the practice that prevailed before traffic control became a separate market….

United Rentals points out that its employees are not engaged in construction, but rather in a preparatory or ancillary activity. But the statutory exception is not for construction workers as such; it is for workers at a construction site; and traffic control workers work at highway construction sites…. Placing traffic control



workers within the exception.… creates a clear rule. March down the road of attempting to distinguish “real” construction workers from other workers at the construction site and you will quickly find yourself in a trackless wilderness….

[The court determined that the hot cargo provision in this case did not raise any “traditional antitrust concerns” and was not in violation of the Sherman Act.]


Case Questions

1. What rationale exists for the construction industry proviso allowing unions in the construction industry to negotiate hot cargo provisions in their collective bargaining agreements?

2. Since United Rentals employees are not engaged in construction, are they exempt from the construction industry proviso?


BRENNAN, J.… Under The Landrum-Griffin Act amendments enacted in 1959, Section 8(b)(4)(A) of the National Labor Relations Act became Section 8(b)(4)(B) and Section 8(e) was added. The questions here are whether, in the circumstances of this case, the Metropolitan District Council of Philadelphia and Vicinity of the United Brotherhood of Carpenters and Joiners of America, AFL-CIO (hereafter the Union), committed the unfair labor practices prohibited by Section 8(e) and 8(b)(4)(B).

Frouge Corporation, a Bridgeport, Connecticut, concern, was the general contractor on a housing project in Philadelphia. Frouge had a collective bar- gaining agreement with the Carpenters’ International Union under which Frouge agreed to be bound by the rules and regulations agreed upon by local unions with contractors in areas in which Frouge had jobs. Frouge was therefore subject to the provisions of a collective bargaining agreement between the Union and an organization of Philadelphia contractors, the General Building Contractors Association, Inc. A sentence in a provision of that agreement entitled Rule 17 provides that “… No member of this District Council will handle … any doors … which have been fitted prior to being furnished on the job …” Frouge’s Philadelphia project called for 3,600 doors. Custom- arily, before the doors could be hung on such projects, “blank” or “blind” doors would be mor- tised for the knob, routed for the hinges, and beveled to make them fit between jambs. These are tasks traditionally performed in the Philadelphia area by

the carpenters employed on the jobsite. However, precut and prefitted doors ready to hang may be pur- chased from door manufacturers. Although Frouge’s contract and job specifications did not call for prema- chined doors, and “blank” or “blind” doors could have been ordered, Frouge contracted for the pur- chase of premachined doors from a Pennsylvania door manufacturer which is a member of the National Woodwork Manufacturers Association, petitioner in No. 110 and respondent in No. 111. The Union ordered its carpenter members not to hang the doors when they arrived at the jobsite. Frouge thereupon withdrew the prefabricated doors and substituted “blank” doors which were fitted and cut by its carpenters on the jobsite.

The National Woodwork Manufacturers Associa- tion filed charges with the National Labor Relations Board against the Union alleging that by including the “will not handle” sentence of Rule 17 in the collective bargaining agreement the Union committed the unfair labor practice under Section 8(e) of entering into an “agreement … whereby the employer … agrees to cease or refrain from handling … any of the products of any other employer….,” and alleging further that in enforcing the sentence against Frouge, the Union com- mitted the unfair labor practice under Section 8(b)(4)(B) of “forcing or requiring any person to cease using… the products of any other … manufacturer….”

The Landrum-Griffin Act amendments of 1959 were adopted only to close various loopholes in the application of Section 8(b)(4)(A) which had been exposed in Board and court decisions….




In addition to unfair labor practice and injunction procedures providing redress against illegal boycotts and for picketing activities, the Labor Management Rela- tions Act of 1947 provides for damage suits in the federal courts. Section 303 makes it unlawful for any labor organization to engage in conduct prohibited by Section 8(b)(4) of the National Labor Relations Act, which includes all the second- ary boycott and picketing activities previously discussed in this chapter.

This loophole closing measure … did not expand the type of conduct which Section 8(b)(4)(A) con- demned. Although the language of Section 8(e) is sweeping, it closely tracks that of Section 8(b)(4) (A), and just as the latter and its successor Section 8(b)(4)(B) did not reach employees’ activity to pressure their employer to preserve for themselves work traditionally done by them, Section 8(e) does not prohibit agree- ments made and maintained for that purpose….

The Woodwork Manufacturers Association and amici who support its position advance several rea- sons, grounded in economic and technological factors, why “will not handle” clauses should be invalid in all circumstances. Those arguments are addressed to the wrong branch of government. It may be that the time has come for a reevaluation of the basic content of collective bargaining as contemplated by the federal legislation. But that is for Congress….

The determination whether the “will not handle” sentence of Rule 17 and its enforcement violated Section 8(e) and 8(b)(4)(B) cannot be made without an inquiry into whether, under all the surrounding circumstances, the Union’s objective was preservation of work for Frouge’s employees, or whether the agree- ments and boycott were tactically calculated to satisfy union objectives elsewhere. Were the latter the case, Frouge, the boycotting employer, would be a neutral bystander, and the agreement or boycott would, within the intent of Congress, become secondary. There need not be an actual dispute with the boycotted employer, here the door manufacturer, for the activity to fall within this category, so long as the tactical object of the agreement and its maintenance is that employer, or benefits to other than the boycotting employees or other employees of the primary employer thus making the agreement or boycott secondary in its aim. The touchstone is whether the agreement or its maintenance is addressed to the labor relations of the

contracting employer vis-á-vis his own employees. This will not always be a simple test to apply. But “[h]owever difficult the task of drawing of lines more nice than obvious, the statute compels the task.”

That the “will not handle” provision was not an unfair labor practice in this case is clear. The find- ing of the Trial Examiner, adopted by the Board, was that the objective of the sentence was preserva- tion of work traditionally performed by the jobsite carpenters. This finding is supported by substantial evidence, and therefore the Union’s making of the “will not handle” agreement was not a violation of Section 8(e).

Similarly, the Union’s maintenance of the provision was not a violation of Section 8(b)(4)(B). The Union refused to hang prefabricated doors whether or not they bore a union label, and even refused to install prefabricated doors manufactured off the jobsite by members of the Union. This and other substantial evi- dence supported the finding that the conduct of the Union on the Frouge jobsite related solely to preserva- tion of the traditional tasks of the jobsite carpenters.

The judgment is affirmed in No. 110, and reversed in No. 111.

It is so ordered.

Case Questions

1. Define the term hot cargo clause. 2. Why was Section 8(e) of the Landrum-Griffin

Act made law? 3. What test did the Supreme Court set out for

determining whether the “will not handle” clause and its enforcement were in violation of Section 8(e) and Section 8(b)(4)(B)?

4. State the findings of the Supreme Court con- cerning the objective of the union’s “will not handle” clause.


Suits for damages, with judgments and costs enforceable against the union’s assets but not against individual members, are specifically permitted by Section 303.

In the U.S. Information Systems, Inc. v. IBEW, Local 164 case, presented in this section, the neutral employer USIS successfully brought a Section 303 private action against IBEW, Local 164, for damages from violation of Section 8(b)(4).


[In early 2007, Ernst & Young published a request for bids to install telecommunications equipment at its Secaucus, New Jersey, project. Preferred Communica- tions Technologies (PCT) submitted the winning bid. It then subcontracted the work to U.S. Information Systems, Inc. (USIS), whose employees are represented by the Communication Workers of America (CWU), Local 1106. On August 16, 2007, IBEW Local 164 placed a picket line on the building project, and 100 union members employed by other companies refused to cross the picket line, shutting down the project. Because of the picketing by the IBEW, Ernst & Young requested PCT to remove USIS from the job. USIS was replaced by Star-Lo, a contractor that had a relationship with IBEW Local 164. USIS filed a Section 303 lawsuit against Local 164 for damages, asserting a violation of Section 8(b)(4). IBEW Local 164 defended its picketing as a legal area-standards protest.]

LINARES, D.J…. Section 8(b)(4)(i)(B) prohibits any labor organization from inducing or encouraging any person employed by a neutral employer to strike or refuse to work. See George v. Nat’l Ass’n of Letter Carriers, 185 F.3d 380, 388 (5th Cir. 1999). Secondary boycotting and secondary picketing have been construed as unfair labor practices pursuant to subsection (b)(4) of the NLRA.

Area Standards The maintenance of the compensation rate in a geo- graphic area is a legitimate focus of union activity. In this regard, a union has a right to protest the payment of substandard wages through area stan- dard picketing even if it results in a work stoppage.

“[A]rea standards picketing is permissible only where it can be shown that the employer’s mode of operation is substandard in comparison with the negotiated area standards.” This means that “there must have been an investigation and an evaluation of comparative standards carried out with as great a degree of thoroughness as the circumstances will permit.” Sales Delivery Drivers, Warehousemen and Helpers Local 296 and Food Employers Council, Inc., 205 N.L.R.B. 462, 471 (1973).

Local 164’s claim of substandard wages was not based on actual knowledge and its investigation of such was cursory at best. Any suspicions it may have had regarding Plaintiffs alleged substandard wages— to the extent such suspicions existed—were entirely unsubstantiated. If Local 164 had been trying to ascertain whether Plaintiff was, in fact, paying sub- standard wages, [Local 164 Business Agent] Misciag- na’s testimony confirms that it could have easily obtained a copy of the relevant CBA. In addition, Local 164 could have attempted to contact Plaintiff directly prior to erecting the picket. Local 164’s failure to make such obvious efforts to substantiate its claim of substandard wages calls into question its true object. More importantly, in failing to make such efforts, Local 164’s actions fall short of those required for properly asserting a claim of substandard wages….

In light of the foregoing, the Court finds that Local 164 has not established that it made a bona fide attempt to determine that Plaintiff’s wages were, in fact, substandard. Such a finding, coupled with evi- dence presented by the Plaintiff of the circumstances leading up to and surrounding Local 164’s August 16, 2007 picket, compels an inference that mainte- nance of area standards was not its true object.




1. Distinguish between the strike and the boycott and between the boycott and the picketing weapons in labor disputes.

2. Can secondary activity be found at a single building construction site? On a primary employer’s own property?

3. To what extent may consumer picketing be carried out legally?

4. What are the dual objectives of Section 8(b)(4) of the NLRA?

5. What was the purpose of including unfair labor practices for labor organizations in the NLRA in 1947?

6. Does Section 8(b)(3) regarding a labor organization’s duty to bargain collectively impose any more duties than Section 8(a)(5) regarding an employer’s duty to bargain collectively? Explain.

7. The Wine and Liquor Store Employees Union had a union security clause in its col- lective bargaining agreement with Oz Liquor Company. The agreement provided that when an employment vacancy occurs, the company must give the union 24 hours to produce a member for the job. After 24 hours, the company could hire a person “provided such person makes application to, and is accepted by the union.” Oz further agreed to employ only “employees in good standing with the union,” with the union being the “sole judge of the good standing of its members.” The company also agreed to

discharge any employee upon receipt of notice that the employee was “no longer a member in good standing in the union.” The company refused to discharge certain employees whom the union claimed were not members in good standing. The union sought arbitration to enforce the terms of the collective bargaining contract. Oz Liquor, however, petitioned the NLRB to rule the union security clause unlawful under Sections 8(b)(1) and (2).

How should the Board decide this case? [Distillery Workers, 261 NLRB 1070, 110 LRRM 1184]

8. J. R. Stevenson Corporation was engaged in a large construction project for which it needed intrasite and intersite truck drivers belonging to the Teamsters Union. Part of the collective bargaining agreement with the Teamsters required that Stevenson pro- vide a heated trailer with a telephone at the site and hire a shop steward for the site. Stevenson paid Arpod Korchma $20,000 per year to serve as shop steward. As shop steward, however, Korchma remained inside the heated trailer during working hours, emerging only to check the union cards of drivers as they entered the site gate. Stevenson eventually objected to the presence of Korchma, claiming that it had no use for him and that he performed no work or traditional Teamster duties.

It is therefore the finding of this Court that Local 164’s true object was to force PCT to cease doing business with the Plaintiff in order to obtain the Ernst & Young telecommunications project for one of its signatory contractors. Picketing for such a pro- scribed object constitutes a secondary boycott in vio- lation of Section 8(b)(4)(i)(B). Plaintiff’s motion for summary judgment as to this claim is, therefore, granted. [The issue of the amount of damages under Section 303 of the LMRA is to be resolved before a magistrate judge.]

Case Questions

1. Explain the “secondary” nature of Local 164’s actions in this case which were held to be a violation of Section 8(b)(4).

2. Area-standards picketing is legal. Was this a valid defense for Local 164?

3. Does Section 303 of the LMRA allow a private lawsuit against a union for damages caused by secondary picketing?


Stevenson charged the Teamsters with featherbedding in violation of Section 8(b)(6). The union denied that it was engaging in this practice.

What factors must the Board consider in deciding a featherbedding case? What was the result in this case? [Teamster Local 456, 212 NLRB 968, 87 LRRM 1101]

9. Jimmy Hunter, business agent for Pipefitters Local 101, arranged a meeting with Ben Jenkins, the president of Interstate Plumbing and Heating Corporation. He told Jenkins that he had in his possession authorization cards signed by a “clear majority” of Inter- state’s shop employees, appointing Local 101 as their exclusive bargaining agent. Hunter asked Jenkins to recognize the union immediately because it would “save [Jenkins] a lot of grief” and they could “get down to business.” Jenkins said that he would bargain with Hunter only if a fair election were held with secret-ballot voting. Hunter left Jenkins’s office and supervised the immediate formation of a picket line in front of Interstate’s shop. After some five weeks, no election had been requested, but the picketing continued. Jenkins petitioned the NLRB to stop the picketing. The union claimed that the pickets were not violent and merely informed the public that Interstate refused to negotiate with the union.

Is this picketing lawful under the NLRA? Decide. [Sheet Metal Workers, 260 NLRB 1332, 110 LRRM 1010]

10. The members of Teamsters Local 391 established a picket line immediately upon commencement of a lawful strike against their employer, Seaboard Foods, Inc., of Rocky Mount, North Carolina. After patrolling in front of the plant, the union members were arrested for violating a Rocky Mount ordinance prohibiting picketing on a public way without a permit. The ordinance required a 72-hour advance notice for the permit. The permit could be denied by the city manager or police chief if the picketing would “ create hazardous traffic conditions” or “disturb the

convenience of the public.”The ordinance also placed specific limitations on picketing, allowed only ten picketers, required single-file processions only on the sidewalk, and allowed picket signs no larger than two feet. After failing in their attempt to secure a permit, the members of Local 391 were arrested again when they resumed picketing.

The union challenged the Rocky Mount ordinance as unconstitutional. The city defended its ordinance as necessary to pro- tect the safety and welfare of the citizens. Decide. [Teamsters Local 391 v. Rocky Mount, 109 LRRM 3114 (4th Cir.)]

11. Local 182, International Union of Electrical Workers, went on strike at the General Elec- tric (GE) plant in Hickory, North Carolina, on October 24. The union imme- diately established a picket line in front of the plant and bordering a major intersection. One of the roads served as the principal approach route for a neighboring local hospital. The presence of the picketers snarled traffic and delayed medical personnel bound for the hospital. Employees at GE who chose to work had their cars damaged and were subjected to thrown rocks and verbal insults as they passed through the group of 79 strikers. On November 3, GE obtained a preliminary injunction in state court enjoin- ing Local 182 from assaulting GE employees, damaging property, and obstructing public roads and plant gates. The injunction also prohibited mass picketing by limiting the number of pickets at any one time to six.

The union claimed the state court had no power to grant this injunction because labor activity is under the exclusive jurisdic- tion of the NLRB. GE disagreed and wanted the injunction continued permanently in the event of any future labor strike.

May the state court grant this injunction? If so, may GE extend the injunction to cover future disputes? [General Electric v. Local 182, 106 LRRM 2191 (N.C. Ct. App.)]

12. Arlie Heald, business agent for Local 265 (IBEW), had been told by Roger Trautwein,


president of RP&M Electric Company, that RP&M might be interested in signing a col- lective bargaining agreement with the union for its employees. After several attempts by Heald to begin negotiations with RP&M, Trautwein told him that the company was no longer interested. The union did not file a Section 9(c) recognition petition on behalf of the RP&M employees, but Heald did send a letter to Trautwein citing the “substandard wages, hours, and working conditions” of the RP&M employees. The union stated in the letter that it recognized the right of RP&M to be nonunion. However, the union asked Trautwein to pay his employees “union scale wages” and offer working conditions similar to those secured by the union. If RP&M did not comply with this request, Heald promised to inform the pub- lic, through picketing, of the substandard employment conditions at RP&M. For two months, pickets from Local 265 patrolled RP&M jobsites with signs stating, “RP&M Electric does not pay Union scale wages,” which caused some disruption of work.

RP&M filed unfair labor practice charges with the NLRB and claimed that the union violated Section 8(b)(7) by picketing for recognition. The union defended its action as informational picketing sanctioned under Section 8(b)(7) of the NLRA.

What factors should the NLRB weigh when deciding this case? Is Local 265’s picketing lawful? Decide. [NLRB v. Electri- cal Workers Local 265, 102 LRRM 1694 (8th Cir.)]

13. Ashton Company was the general contractor on a construction project for American Smelting and Refining Company. Ashton had received objections from members of Local 741 of the Plumbers Union when it designated that the installation of all process piping, including air and water pipes, was to be performed by members of the Laborers International Union. After the plumbers began to picket the construction site, the dispute was taken before the NLRB pursuant

to Section 10(k) of the Act. The Board found that the work should be performed by the Laborers International Union and ruled that the decision of the Impartial Jurisdictional Dispute Board, which had ruled in favor of the Plumbers Union, was not binding on the contractor. After the Board’s ruling, the plumbers resumed picketing at the jobsite, causing delays in deliveries and forcing some members of craft unions not to report to work. The pickets demanded that Ashton recognize the ruling of the Impartial Board and award the pipe work to the Plumbers Union.

Ashton Company charged Local 741 with engaging in an unfair labor practice. The union maintained that it had the right to inform other workers and the public about Ashton’s refusal to give pipe work to plumbers.

May the union lawfully inform others in this manner? Decide. [United Ass’n of Jour- neymen & Apprentices of the Plumbing and Pipefitting Industry, 259 NLRB No. 123, 109 LRRM 1062]

14. R. H. Drukker & Company, a nonunion general contractor, was engaged to construct a restaurant and adjacent office building on a large site in New Jersey. Drukker com- pleted preliminary work on the Red Lobster Restaurant and had moved some of its excavating equipment to the office building site 500 feet away when pickets arrived from Local 825 of the Operating Engineers. The union established a picket line that covered entrances to both of Drukker’s projects. The union’s signs claimed that Drukker’s employees received less than union wages and endured substandard working condi- tions, but also stated that Local 825 had “no dispute with any other employer at this site.” Although Drukker removed its employees and equipment from the Red Lobster job, the union continued to picket that area. Employees of neutral employers chose not to cross the picket line, halting progress on the Red Lobster job for two weeks. The job


superintendent of the Red Lobster site informed Local 825 that Drukker was no longer at that site, and the union withdrew to concentrate its efforts on the office proj- ect. Before leaving, however, the union business agent warned that as soon as Drukker returned, so would the pickets. Work by other contractors immediately resumed on the restaurant.

The NLRB ruled that the union had engaged in unlawful activity by picketing the Red Lobster site. Local 825 appealed this ruling to the circuit court. What factors must the circuit court weigh to determine the legality of the union’s conduct? Decide. [NLRB v. Operating Engineers, Local 825, 108 LRRM 2480 (3d Cir.)]

15. The United Paperworkers International Union engaged in a lawful strike against Duro Paper Bag Company. In furtherance of its dispute with Duro, the union established pickets at two local Kroger Supermarkets. The pickets’ signs and handbills announced a “consumer boycott of Duro Paper Bag Co.” and urged customers to ask Kroger for boxes or bring their own bags to transport their purchases from the market. On the first day of picketing, 4,300 customers passed through the two stores, but Kroger was only able to furnish 115 customers with boxes before it exhausted its supply. Kroger claimed that it could furnish boxes to only 2.5 percent of its customers. On at least one occasion, a woman abandoned her pur- chased items at the cash register when her request for a box instead of a Duro bag could not be satisfied. The woman refused to pay and use what she termed “scab bags.”

Kroger claimed before the NLRB that the union was engaged in a secondary boy- cott in violation of Section 8(b)(4)(ii)(B). The union insisted that its picketing activity was legal under the Tree Fruits and Safeco

decisions. Decide. [Kroger Co. v. NLRB, 105 LRRM 2897 (6th Cir. 1980); Paper- workers, Local 832, 258 NLRB 67, 108 LRRM 1073]

16. Texaco, Inc., operates a refinery in Ana- cortes, Washington, and contracts with independent contractors to process a refinery byproduct into a commercially usable prod- uct at a separate on-site coking unit. Alpha Omega Construction, Inc., was the coking contractor from 1990 through 1995. Texaco awarded the contract to Western Plant Ser- vices, Inc. (WPS) on June 1, 1995. To protest the failure of WPS to hire former Omega workers represented by the Oil, Chemical and Atomic Workers (OCAW) union, the union began picketing gates 6 and 7 at the Texaco refinery, gates reserved for WPS’s workers and suppliers. Burlington Northern Railroad (BN) had been assigned a separate reserved gate at the BN’s spur track. BN was under contract with Texaco to transport the products produced by WPS at the coking facility. Neither BN nor Texaco had a labor dispute with OCAW. However, on June 3 and June 5, an OCAW union member picketed the BN reserved gate area and the main line, respectively, disrupting BN’s ser- vice under its contract with Texaco to transport products from the coking facility operated by independent contractor WPS. The General Counsel contended that the picketing of the BN reserved gate was secondary picketing in violation of Section 8(b)(4)(B). Because employers other than WPS were working at the facility, the General Counsel contended that Moore Dry Dock standards should apply to the com- mon situs picketing. OCAW contended that it was lawful primary situs picketing under the Steelworkers v. NLRB & Carrier Corp. decision. Decide. [OCAW v. Burlington Northern Railroad, 325 NLRB 45]




7:1 Types of Stoppages

7:2 Employer Unfair-Labor-Practice Strikes

7:3 Permanent Replacement of Strikers

7:4 Unprotected Strike Activity

7:5 Effects of Strikes in Violation of NLRA Notice Requirements

7:6 No-Strike Agreements

7:7 Norris-LaGuardia and No-Strike Injunctions

7:8 National Emergency Strikes


The strike is perhaps the most potent weapon possessed by labor to force its demands upon an employer. Its usual concomitant is the establishment of a picket line. Sometimes the boycott is simultaneously employed against an especially resis- tant employer.

The strike may generally be defined as a temporary and concerted with- drawal of workers from an employer’s service to enforce their demands, the workers retaining a contingent interest in their jobs. The degree to which workers retain a vested or contingent interest in the positions they leave will depend largely upon the purpose of the strike, the means employed to effect the strike, and the success of the employer in securing effective replacements. Inter- pretations under the National Labor Relations Act have clarified the status of


workers engaging in the various forms of strikes. The determination of a stri- ker’s status becomes important with respect to deciding questions of reinstate- ment of workers, awarding of back pay, and the rights of individuals to participate in representation elections.

Although a general definition has been given, it is important to distinguish the several forms of strike activity. The primary strike involves a withdrawal of a single employer’s workers who seek a direct and immediate benefit to themselves. The secondary strike involves a withdrawal of another employer’s workers who thereby exert pressure on their own employer in the expectation that the employer will, in turn, bring pressure upon an employer with whom the union has a dispute. Thus, the unionized workers of X Company withdraw to force X to bring pressure upon the Y Company with whom the union has an unsettled dispute. The secondary strike has sympathetic elements but is distinguishable from a sympathetic strike in that to fall in the secondary rather than the sympa- thetic category, the strike in question must be conducted for the direct benefit of the union involved. If the strike is for the direct benefit of some other union and if the strikers secure only an incidental benefit from the strike, then we have a sympathetic or sympathy strike.

The general strike involves work cessation by most, if not all, workers in a particular industry, such as coal or steel, or most, if not all, workers in a particular city. In its widest and most serious application, the workers of an entire nation are involved. European countries have seen more national general strikes, which may be traced to the broad economic and political character of this strike form. Strongly unified labor employs the general strike for the assertion of strength to protest against adverse industrywide conditions of employment or antilabor legisla- tion. The general strike was restricted by the inclusion in the amended National Labor Relations Act of 1947 of Sections 206–210 on national emergency strikes. Usage of the general strike weapon is not subject to executive action and injunction.

The sit-down strike covers a cessation of work by employees without with- drawal from the plant. In a sit-down strike, employees remain at their workstations but machines and tools remain idle. The slowdown is a variant of the sit-down. In a slowdown, there is no withdrawal from the workstation and the cessation of work is only partial. In a partial strike, only some of the workers leave their work- stations. This technique has been employed successfully in large-scale firms when a union selects a vulnerable department or departments and strikes only in those areas. No merchandise can enter or leave, especially if outside unions give sympa- thetic aid by respecting picket lines established at the receiving and shipping docks. The bulk of union members continue working and draw their pay, as long as the employer does not lock them out.

The wildcat strike is one for which the parent union disclaims responsibility. Presumably, or in fact, it is unauthorized and generally is in breach of a collective agreement.

A jurisdictional strike involves a dispute between two or more unions. In order to compel the employer to take sides, one or both unions instigate a strike. New materials and new production methods, especially in the building trades, often


precipitate controversy between two or more unions, where each seeks to obtain work assignments for its own members.

A whipsaw strike is a strike against one strategically situated employer in order to weaken the opposition of other employers or force them to capitulate, one com- pany being played off against other companies. The Brown Food Stores case, in Chapter 5, is an example.

The National Labor Relations Board lumps all of these strike variants into three broad groupings. The first may be termed the economic strike; the second, the employer unfair-labor-practice strike; and the third, the union unfair- labor-practice strike. The economic strike is concerned with demands regarding hours of work, wages, and working conditions. The employer unfair- labor-practice strike involves a strike by employees that is called in retaliation against unfair employer practice. (See Chapter 5.) These unfair practices include the denial to workers of the right to bargain collectively, discrimination against union members, and other proscribed interferences with legitimate collective activ- ity. The third type of strike under the National Labor Relations Act is designated a union unfair-labor-practice strike or an unprotected activity strike. Activities made unfair by the amendments of 1947 and 1959, activities in violation of no-strike agreements, and other strikes that remove the strikers from the protection of the law will be discussed in the following sections to show how the rights of stri- kers differ in each type of situation.


In a strike by lawful, nonviolent methods to protest an unfair labor practice com- mitted by the struck employer, strikers are protected from discharge or from the loss of employment by replacements. Replacements may be hired to fill the strikers’ jobs, but only for the period until the strikers seek to return to work.

The Mastro Plastics case, reported next, established the right of employees striking against employer violations of the NLRA to reinstatement with limited back pay rights. Under Mastro Plastics, back pay was to be paid for the period of time after the striking employees made an unconditional offer to return to work, which was ignored by the employer. This remedy was sustained notwithstanding an agreement prohibiting strikes and also the failure of the employees to observe obligations that would otherwise have been in effect except for the employer’s unfair labor practices.

In John Cuneo, Inc. v. NLRB,1 the court of appeals endorsed the Board’s holding that even though a strike began as an economic strike for recognition of the union, it was converted to an unfair-labor-practice strike when the company engaged in widespread unfair labor practices following the union’s bid for recognition based on authorization cards. The precedent decision was the

1 681 F.2d 11 (D.C. Cir. 1982).


Board’s Drug Package Co.2 ruling, which held that striking employees are entitled to reinstatement as unfair-labor-practice strikers when an employer engages in unfair practices that undermine the process for choosing union representatives.

In Overstreet v. El Paso Disposal, L. P.,3 the U.S. Court of Appeals for the Fifth Circuit affirmed the federal district court’s Section 10(j) temporary injunction against El Paso Disposal Co. (EPD), ordering the immediate reinstatement of striking workers whom the district court classified as “unfair labor practice strikers.” It also ordered EPD to recognize the union and resume bargaining. To persuade a federal district court to issue a Section 10(j) temporary injunction, the regional director had to prove (1) that it had reasonable cause to believe unfair labor practices had occurred, and (2) that injunctive relief was “just and proper.” The record contained evidence that EPD engaged in bad faith bargaining in its conduct at and away from the bargaining table, and that there was a causal link between EPD’s bad faith bargaining and the strike. This established that the 55 striking employees were unfair-labor-practice strikers entitled to immediate reinstatement upon their unconditional offer to return to work. EPD failed to immediately reinstate the unfair-labor-practice strikers. The issuance of the Section 10(j) temporary injunction was “just and proper” for the reasons set forth in part by the appeals court as follows:

Other factors support the conclusion that the district court did not abuse its discre- tion in granting injunctive relief and ordering reinstatement of the strikers. The ALJ found, and the district court agreed, [that] EPD’s discharge of the strikers and failure to reinstate them was a direct cause of the anti-Union sentiment among the workers that led to several petitions to decertify the Union as the workers’ representative. As EPD still had not reinstated thirty-two of the fifty-five striking workers, the district court found that a “large nucleus” of Union support had been replaced because of EPD’s failure to reinstate. Of the eleven Union strikers who were recalled, six had signed the disavowal petition. These findings of fact, which are not clearly errone- ous, support the district court’s order of reinstatement as necessary to avoid severely diminishing Union support and, with it, the ability of the Union to negotiate with EPD. Reinstatement preserves the status quo by returning the workforce to pre-strike level of Union support. Finally, a refusal to reinstate in this case would merely reward EPD for its unfair labor practices, as it would gain a benefit from its decision to deny the right of unfair labor practices strikers to be reinstated after they stop striking.4

2 228 NLRB 108 (1977). 3 625 F.3d 844(5th Cir. 2010). 4 The union first filed charges in this case in November 2007. The matter escalated over the years, with 13 months of bargaining, and a strike, upon which the strikers were permanently replaced. Proceedings continue before the Board, and the regional director sought the Section 10(j) injunction in federal district court to preserve the status quo until the Board issues its final order in the case.



[Mastro Plastics Corporation and its sister corpora- tion F. A. Reeds Company (Mastro or petitioners) manufactured plastic parts for musical instruments at a plant in New York City. Their employees were represented by Carpenters Local 3127. In August 1950, Local 65 of the Warehouse Workers Union began a campaign to represent Mastro/F. A. Reeds employees. Mastro bitterly opposed the movement, believing Local 65 to be communist-controlled. Believing that the Carpenters were too weak to cope successfully with Local 65, Mastro asked the Carpen- ters to transfer their bargaining rights to Local 318, International Brotherhood of Paper Mill Workers, AFL. When the Carpenters declined to do so, Mastro selected a committee of employees to visit Local 318, obtain membership cards, and seek members for that union. The cards were distributed during working hours, and Mastro paid the employees for time spent in the campaign, including attendance at a meeting of Local 318. Mastro’s officers and supervi- sors instructed employees to sign these cards and indi- cated that those refusing to do so would be “out.”

On September 28, Local 65 filed with the NLRB its petition for certification as bargaining representa- tive. On October 24, Local 318 intervened in the representation proceedings and asked that it be certi- fied. However, many employees revoked their appli- cations for membership in Local 318 and reaffirmed their adherence to the Carpenters. This was followed on October 31 by the Carpenters’ refusal to consent to an election on the ground that petitioners had unlawfully assisted Local 318 in the campaign.

On November 10, 1950, Mastro’s president dis- charged Frank Ciccone because of his activity in sup- port of the Carpenters and his opposition to Local 318. The discharge precipitated a strike. There was no disorder, but the plant was shut down until December 11; and it was March 9, 1951, before the Carpenters, on behalf of Mastro employees, made an unconditional request to return to work. Mastro ignored that request, and neither Ciccone nor any of the other 76 striking employees were reinstated.]

BURTON, J… This case presents two principal questions: (1) whether in the collective bargaining contract before

us, the union’s undertaking “to refrain from engaging in any strike or work stoppage during the term of this agreement” waives not only the employees’ rights to strike for economic benefits but also their right to strike solely against unfair labor practices of their employers, and (2) whether Par. 8(d) of the National Labor Relations Act, as amended, deprives indivi- duals of their status as employees if, within the wait- ing period prescribed by Par. 8(d)(4), they engage in a strike solely against unfair labor practices of their employers. For the reason hereafter stated, we answer each in the negative.

Petitioners admitted that they had discharged the employees in question and had not rehired them. They denied, however, that in so doing they had com- mitted any unfair labor practices. Their first affirma- tive defense was that the waiver of the right to strike, expressed by their employees in their collective bar- gaining contract, applied to strikes not only for eco- nomic benefits but to any and all strikes by such employees, including strikes directed solely against unfair labor practices of the employer.

Petitioners’ other principal defense was that the existing strike began during the statutory waiting period initiated by the employees’ request for modifi- cations of the contract and that, by virtue of Section 8(d) of the Act, the strikers had lost their status as employ- ees. That defense turned upon petitioners’ interpreta- tion of Section 8(d), applying it not only to strikes for economic benefits but to any and all strikes occurring during the waiting period, including strikes solely against unfair labor practices of the employer.

The trial examiner made findings of fact sustaining the complaint and recommended that petitioners be ordered to cease and desist from the interference com- plained of and be required to offer Ciccone and the 76 other discharged employees full reinstatement, together with back pay for Ciccone from November 10, 1950, and for the other employees from March 9, 1951. With minor modifications, the Board adopted the examiner’s findings and conclusions and issued the recommended order.

Because of the importance of the issues in indus- trial relations and in the interpretation of the National Labor Relations Act, as amended, we granted certiorari. 348 U.S. 910.




Since the 1938 Supreme Court decision in NLRB v. Mackay Radio & Telegraph Co.,5 an employer has been allowed to hire permanent replacements for economic strikers. In dicta in Justice Roberts’s majority opinion in Mackay, he stated that it was not “an unfair labor practice to replace the striking employees with others in an effort to carry on the business.”6 Additionally, he stated that it was not an unfair labor practice “to reinstate only so many of the strikers as there were vacant places to be filled.”7 Under Mackay, then, an employer can refuse to reinstate strikers at the conclusion of an economic strike if it has replaced them with permanent employees.


Restrictions, limitations, and special rules are applied to the general Mackay rule allowing permanent replacements.

Apart from the issues raised by petitioners’ affir- mative defenses, the proceedings reflect a flagrant example of interference by the employers with the expressly protected right of their employees to select their own bargaining representative. The findings dis- close vigorous efforts by the employers to influence and even to coerce their employees to abandon the Carpenters as their bargaining representatives and to substitute Local 318. Accordingly, unless petitioners sustain at least one of their affirmative defenses, they must suffer the consequences of their unfair labor practices violating Section 8(a)(1), (2) and (3) of the Act, as amended.

In the absence of some contractual or statutory provision to the contrary, petitioners’ unfair labor practices provide adequate ground for the orderly strike that occurred here. Under those circumstances, the striking employees do not lose their status and are entitled to reinstatement with back pay, even if repla- cements for them have been made. Failure of the Board to enjoin petitioners’ illegal conduct or failure of the Board to sustain the right to strike against that conduct would seriously undermine the primary objectives of the Labor Act. While we assume that

the employees, by explicit contractual provision, could have waived their right to strike against such unfair labor practices and that Congress, by explicit statutory provision, could have deprived strikers, under the circumstances of this case, of their status as employees, the questions before us are whether or not such a waiver was made by the Carpenters in their 1949–1950 contract and whether or not such a deprivation of status was enacted by Congress in Section 8(d) of the Act, as amended in 1947.…

As neither the collective bargaining contract nor Section 8(d) of the National Labor Relations Act, as amended, stands in the way, the judgment of the Court of Appeals is


Case Questions

1. What unfair labor practices did the employer commit?

2. Was the agreement a strike deterrent? Why or why not?

3. What did the Court find as to the legality of the union conduct?

5 304 U.S. 333 (1938). 6 Id. at 345. 7 Id. at 346.


REINSTATEMENT RIGHTS FOR ECONOMIC STRIKERS. Section 2(3) of the NLRA provides that an individual whose work has ceased as a consequence of a labor dispute continues to be an employee if the individual has not obtained regular and substantially simi- lar employment. If at the conclusion of a strike an employer refuses to reinstate striking employees to vacant positions, the effect is to discourage employees from exercising their rights to organize and strike guaranteed by Sections 7 and 13 of the NLRA. In NLRB v. Fleetwood Trailer Co.,8 the Supreme Court dealt with the ques- tion of an employer’s obligation to rehire economic strikers who unconditionally applied for reinstatement at the end of a strike if no work existed for them at that time. The employer contended in Fleetwood that the right of strikers to jobs must be judged as of the date they apply for reinstatement, which was August 20; because no jobs were available on that date, the employer argued, their requests were prop- erly rejected. On October 8 and 16, the employer hired six new employees for jobs that six strikers were qualified to fill. The six strikers were ultimately reinstated by December 14. The Supreme Court ruled that the six strikers should have been rehired as soon as jobs became available and that therefore the employer had vio- lated Sections 8(a)(1) and (3) of the NLRA by hiring six new employees rather than reinstating the strikers in October. On the basis of the Supreme Court’s decision in Fleetwood, the NLRB set forth a comprehensive rule on the reinstatement rights of economic strikers in its Laidlaw Corp. decision.9 The Laidlaw rule states that

economic strikers who unconditionally apply for reinstatement at a time when their positions are filled by permanent replacements: (1) remain employees; (2) are entitled to full reinstatement upon departure of replacements unless they have in the meantime acquired regular and substantially equivalent employment, or the employer can sustain his burden of proof that the failure to offer full reinstatement was for legitimate and substantial business reasons….10

In NLRB v. Oregon Steel Mills, Inc.,11 the employer placed the names of former strikers on a preferential reinstatement list after the union made an uncon- ditional offer to end a strike at the steel mills. The employer reinstated a number of employees from this list. However, it then utilized the services of a temporary employment agency to provide temporary workers to do other work formerly done by strikers instead of returning available qualified former strikers from the preferential hiring list. The Board and the U.S. Court of Appeals for the Ninth Circuit placed the burden of proof on the employer to demonstrate a legitimate and substantial business reason for refusal to reinstate the strikers to available positions, and they determined that the burden had not been met. The Board held, and the court of appeals affirmed, that it was a violation of Section 8(a)(3) and inherently destructive of employee rights for the employer to utilize a tempo- rary service agency to supply workers when qualified former strikers were available on the preferential reinstatement list.

8 389 U.S. 375 (1967). 9 171 NLRB 1336 (1968). 10 Id. at 1369–70. 11 47 F.3d 1536 (9th Cir. 1995).


As set forth previously, under the Mackay rule, employers may refuse to rein- state strikers at the conclusion of an economic strike if it has replaced them with permanent employees. But under the Laidlaw rule, economic strikers have certain reinstatement rights. In representation election situations, employers may have occasion to address employees about the employer’s right to hire replacements under Mackay. However, election results against union representation will be set aside if the employer’s agent tells employees in a campaign speech before an elec- tion, without other explanation, that “union strikers can lose their jobs” and that “you could end up losing your job by being displaced with a permanent worker.” Such statements have a coercive effect in violation of Section 8(a)(1).12 In such a context, the employer must also reference the Laidlaw right to return to the job.

SPECIAL RULE FOR UNFAIR-LABOR-PRACTICE STRIKERS. Unfair-labor-practice strikers are individuals who go on strike to protest an unfair labor practice of an employer, as opposed to going on strike for better wages, hours, and working conditions and being classified as economic strikers. If an employer fires a union leader because of the leader’s union activity—a Section 8(a)(1) and (3) unfair labor practice—and the discharge precipitates a strike, the employer may hire replace- ment workers, but only for the period until the strikers return to work. When the strikers protesting the unfair labor practice make an unconditional request to return to work, the employer may not continue to employ the replacement work- ers in preference to the strikers. Should the employer do so, it would be liable to pay the unfair-labor-practice strikers back wages for the period of time after its failure to reinstate them.13

In Poly-America, Inc., v. NLRB,14 19 employees walked off the job at the company’s plastic products manufacturing plant in Grand Prairie, Texas, on November 14 over a pay issue relating to a meeting with the company’s owner on November 6. Because the walkout was over an economic issue, the strike thus began as an economic strike. The evidence showed that the company discharged the 19 economic strikers on the night of November 14, not allowing them to return to work after their walkout, before any replacement hires were made. The discharge constituted an unfair labor practice under Section 8(a)(1) and 8(a)(3) of the Act and had the effect of converting the strike from an economic strike to an unfair-labor-practice strike for which reinstatement with back pay is an appropri- ate remedy.

REJECTION OF PREFERENCE FOR TRAINEES OVER RETURNING STRIKERS. In Eastern Air Lines, Inc., v. Airline Pilots Association International,15 the U.S. Court of Appeals for the Eleventh Circuit dealt with the question of whether Eastern was obligated to reinstate striking pilots prior to awarding pilot positions to new-hire pilots who had not completed all requirements to fly revenue flights. The striking pilots

12 Baddour, Inc., 303 NLRB 275 (1991). 13 Mastro Plastics Corp. v. NLRB, 350 U.S. 270 (1956). 14 206 F.3d 465 (5th Cir. 2001). 15 920 F.2d 722 (11th Cir. 1990).


had made unconditional offers to return to work by the end of the strike on November 22, 1989. As of that date, at least 227 new-hire replacement pilots remained in training, not having obtained certificates from the FAA permitting them to fly regular revenue flights. Eastern contended that the new-hire pilots, who were still in training, were permanent employees and as such should not be displaced by returning strikers. The court of appeals ruled that the trainees were not permanent replacements. The court was reluctant to support Eastern’s position because giving preference to trainees over returning strikers discouraged employees from exercising their rights to organize and to strike and undermined the preserva- tion of the employer-employee relationship both during and after the strike. Accordingly, the court rejected Eastern’s preference for trainees over returning strikers and remanded the case to the district court for further proceedings.

EMPLOYER CONTRACTUAL OBLIGATIONS TO REPLACEMENT WORKERS. In Belnap, Inc. v. Hale,16 the employer hired “permanent” replacements for striking employees. Later, as part of a strike settlement agreement with the union, the employer agreed to rein- state the strikers, and the replacement employees were laid off. These employees sued Belnap, Inc., in a state court to recover damages for misrepresentation and breach of contract. The Supreme Court held that the causes of action in state court of the replacement workers who were laid off at the end of the strike were not preempted by the NLRA. However, in the majority opinion, the Court suggested an approach for employers that would allow the employer to call the replacements “permanent” and yet allow the employer to make a strike settlement with the union, if expedient, that would reinstate strikers and lead to the layoff of the replacement workers. The Supreme Court formulation suggests that employers hiring “permanent” replacements could condition their offer of permanent employ- ment, on settlement with the union in question and/or a Board unfair-labor-practice order directing reinstatement of strikers. The Court said such a conditional offer would not render the replacements temporary employees. Should the employer totally prevail in the strike, the employer may keep the replacements if it chooses to do so. Thus, the potential for permanency exists. The Court stated in regard to the conditional offers:

We perceive no substantial impact on the availability of settlement of economic or unfair labor practice strikes if the employer is careful to protect itself against suits like this in the course of contracting with strike replacements. Its risk of liability if it discharges replacements pursuant to a settlement or to a Board order would then be minimal….17

In the Board’s Jones Plastic & Engineering Co. (Camden Division) and United Steelworkers18 decision, the employer hired replacement workers during a strike. Subsequently, the union made an unconditional offer to return to work on behalf of all striking employees. The employer responded that it had a full complement

16 463 U.S. 491 (1983). 17 Id. at 505, 506. 18 351 NLRB No. 11 (2007).


of permanent replacement employees and that returning strikers would be placed on a preferential recall list. The status of the replacement workers determined the outcome of this case before the Board. The replacements were required to sign a statement stating that they were “permanent replacement[s],” but that they could be “terminated … at any time, with or without cause.” The statement then stated, “I further understand that my employment may be terminated as a result of a strike settlement agreement … or by order [of] the National Labor Relations Board.” The three-member Board majority believed that the at-will disclaimer in the first part of the signed statement did not detract from the otherwise valid showing of perma- nent replacement status. The majority concluded that the employer did not violate the act by refusing to reinstate the striking employees immediately. The two dis- senting Board members believed that although the employer used the term perma- nent replacement, it undercut that term by failing to give the replacements assurances that they had any rights vis-á-vis the strikers and that the evidence failed to support a finding that the employer and the replacements shared an understand- ing that the replacements were permanent.

OTHER DECISIONS RESTRICTING CERTAIN EMPLOYER TACTICS. The Supreme Court dealt with creative incentives extended by employers to induce striking employees to return to work in two other major cases. In NLRB v. Erie Resistor Corp.,19 the Supreme Court upheld the Board’s decision prohibiting employers from granting superseniority to strike replacements and strike crossovers (striking employees who later crossed over the picket line to return to work before the termination of the strike) because of the damage superseniority would do to the right to strike and the future bargaining relationship of the parties.

In NLRB v. Great Dane Trailers, Inc.,20 the Supreme Court upheld the Board’s decision that an employer’s payment of vacation benefits to replacements, crossovers, and nonstrikers but not to strikers violated the Act because of its destructive effect on the right to strike. The Court stated that paying accrued bene- fits to one group while announcing the extinction of the same benefits to another group surely would have the effect of discouraging present or future concerted activities.


In TWA v. Independent Federation of Flight Attendants [IFFA], presented in this section, the Supreme Court dealt with the issue of whether senior flight attendants who unconditionally offered to return to work at the end of a strike may displace junior flight attendants who crossed picket lines to work during the strike. TWA argued that it would be anomalous to require crossovers to be displaced when newly hired, permanent employees cannot be displaced under the Mackay decision. The Court accepted this view of the Mackay decision, holding that crossovers need

19 373 U.S. 221 (1963). 20 388 U.S. 26 (1967).


not be displaced in order to reinstate more senior full-term strikers. The TWA deci- sion adds a new device for employers to use to break a strike. The legal rights of employers to promise employees who refrain from participating in a strike or who return to work during a strike that they will not be displaced from desirable jobs at the end of the strike by more senior striking workers gives employers a potent new weapon that can be threatened at the bargaining table or utilized in economic con- flict should a strike ensue. With the risk of losing their positions to permanent replacements or to junior crossover employees, senior employees may be very reluc- tant to support a strike.


In NLRB v. Curtin Matheson Scientific, Inc.,21 the Supreme Court dealt with the question of whether the NLRB, in evaluating an employer’s claim that the employer had a reasonable basis for doubting a union’s majority support, must presume that the permanent employees hired to replace the strikers oppose the union. On May 25, when the bargaining unit consisted of 27 employees, the union began an economic strike. Five employees immediately crossed the picket line. On June 25, the employer hired 29 replacement workers for the 22 strikers. The union ended its strike on July 20. On that date, the employer notified the union that it doubted that the union was supported by a majority of the employees in the unit, and it withdrew recognition from the union. As of July 20, the bargain- ing unit consisted of 29 strikers (not currently working), 25 replacement workers, and 5 crossover employees. The Board reversed the ALJ’s determination that the employer had a reasonably based good faith doubt as to the union’s majority status, holding that it would not use any presumptions with respect to replacement workers’ union sentiments, but would instead take a case-by-case approach and require additional evidence of lack of union support. The Supreme Court upheld the Board’s approach because the employer’s antiunion presumption could allow an employer to eliminate a union in its entirety merely by hiring a sufficient num- ber of replacements and thereby avoid good faith bargaining over a strike settlement.22

Although the Curtin Matheson decision went against the employer’s manda- tory, antiunion presumption, nevertheless an employer can rebut the presumption of majority support of a union after the certification year is over, either by showing that the union in fact lacks majority support or by demonstrating a sufficient objec- tive basis for doubting the union’s majority status.23 The hiring of a significant number of permanent replacements under the Mackay rule may still ultimately undermine a union’s majority status.

21 494 U.S. 775 (1990). 22 Id. at 1553. 23 Id. at 1549–1550.



[At the conclusion of a strike between TWA and the flight attendants’ union, IFFA, TWA refused to dis- place permanent replacements or junior nonstriking attendants (crossover employees) with senior full- term strikers, many of whom were therefore left without an opportunity to return to work. The IFFA filed the instant action contending that, assum- ing the strike was economic, the full-term strikers were entitled to displace the newly hired replace- ments and the less senior crossover attendants under the terms of the prestrike collective bargaining agreement. The district court denied relief for the most part, but the court of appeals, relying on judi- cial interpretation of the National Labor Relations Act, reversed the lower court’s ruling that the more senior full-term strikers could not displace junior crossovers. The question considered before the Supreme Court was whether an employer is required to lay off junior crossover employees in order to reinstate more senior full-term strikers at the conclu- sion of a strike.]


I. We have observed in the past that carefully drawn analogies from the federal common labor law devel- oped under the NLRA may be helpful in deciding cases under the RLA. Thus, as in this case, those lower courts that have examined the reinstatement rights of strikers under the RLA have turned to NLRA precedents for guidance.

We first considered the reinstatement rights of strikers under the NLRA in NLRB v. Mackay Radio & Telegraph Co., 304 U.S. 333 (1938). In Mackay Radio, radio and telegraph operators work- ing in the San Francisco offices of a national tele- communications firm went on strike. In order to continue operations, the employer brought employ- ees from its other offices to fill the strikers’ places. At the conclusion of the strike, the striking operators sought to displace their replacements in order to return to work. We held that it was not an unfair labor practice under § 8 of the NLRA for the employer to have replaced the striking employees

with others “in an effort to carry on the business,” or to have refused to discharge the replacements in order to make room for the strikers at the conclusion of the strike. Id. at 345–346. As we then observed, “[t]he assurance by [the employer] to those who accepted employment during the strike that if they so desired their places might be permanent was not an unfair labor practice nor was it such to reinstate only so many of the strikers as there were vacant places to be filled.” Id., at 346. On various occa- sions we have reaffirmed the holding of Mackay Radio.…

… Both the RLA and the NLRA protect an employee’s right to choose not to strike. 45 U.S.C. § 152 Fourth; 29 U.S.C. § 157, and, thereby, protect employees’ rights to “the benefit of their individual decisions not to strike….” Accordingly, in virtually every strike situation there will be some employees who disagree with their union’s decision to strike and who cannot be required to abide by that deci- sion. It is the inevitable effect of an employer’s use of the economic weapons available during a period of self-help that these differences will be exacerbated and that poststrike resentments may be created. Thus, for example, the employer’s right to hire per- manent replacements in order to continue operations will inevitably also have the effect of dividing strik- ing employees between those who, fearful of perma- nently losing their jobs, return to work and those who remain stalwart in the strike. In such a situa- tion, apart from the “pressure on the strikers as a group to abandon the strike,” to which the dissent refers, a “competition” may arise among the striking employees to return to work in order to avoid being displaced by a permanent replacement. Similarly, employee awareness that an employer may decide to transfer working employees to necessary positions previously occupied by more senior striking employ- ees will isolate employees fearful of losing those positions and employees coveting those positions from employees more committed to the strike. Con- versely, a policy such as TWA employed here, in creating the incentive for individual strikers to return to work, also “puts pressure on the strikers as a group to abandon the strike,” ibid., in the same




A strike may be declared unlawful if it has an unlawful purpose or object or if unlawful means are employed to accomplish a lawful purpose. In either situation, participants are not protected against discharge by their employer.

In most instances, the NLRA defines which strike objectives will be deemed unlawful. Section 8(b)(4) prohibits labor organizations from utilizing certain types of strikes, picketing, and boycotts if they fall into the “secondary” or “juris- dictional” category. Moreover, as amended, Sections 8(b)(7) and 8(e) prohibit any primary or secondary strike, picketing, or boycott where the object is as follows:

1. To force an employer to join an employer organization; 2. To force a self-employed person to join a labor union; 3. To force one employer to cease dealing with another person; 4. To require recognition after another union has obtained bargaining rights by

certification under the Act where redetermination of such rights is barred.

manner that the hiring of permanent replacements does.

To distinguish crossovers from new hires in the manner IFFA proposes would have the effect of penalizing those who decided not to strike in order to benefit those who did. Because permanent replace- ments need not be discharged at the conclusion of a strike in which the union has been unsuccessful, a certain number of prestrike employees will find them- selves without work. We see no reason why those employees who chose not to gamble on the success of the strike should suffer the consequences when the gamble proves unsuccessful. Requiring junior crossovers, who cannot themselves displace the newly hired permanent replacements, “who rank lowest in seniority,” to be displaced by more senior full-term strikers is precisely to visit the consequences of the lost gamble on those who refused to take the risk. While the employer and union in many circum- stances may reach a back-to-work agreement that would displace crossovers and new hires or an employer may unilaterally decide to permit such dis- placement, nothing in the NLRA or the federal com- mon law we have developed under that statute requires such a result. That such agreements are typi- cally one mark of a successful strike is yet another indication that crossovers opted not to gamble; if the strike was successful the advantage gained by declining to strike disappears….


JUSTICE BRENNAN, with whom JUSTICE MARSHALL joins, Dissenting …

The issue in this case is whether under the … RLA an employer, in allocating available jobs among members of a bargaining unit at the conclusion of a strike, may discriminate against full-term strikers by giving prefer- ence to employees who crossed the picket line to return to work before the strike was over. Because I conclude that such discrimination on the basis of union activity is “inherently destructive” of the right to strike, as guaranteed by both the RLA and the National Labor Relations Act (NLRA), I dissent.

Case Questions

1. The labor law governing labor disputes in the airline industry is the Railway Labor Act. May the Supreme Court look to cases decided under the NLRA when deciding a case under the RLA?

2. May an employer and union reach an agreement in conjunction with the end of a strike that would displace crossovers and permanent replacements?

3. Did the Court recognize in its decision that individual employees have a right to choose not to strike?

4. Did the Supreme Court see TWA’s guarantees to crossovers that they would not be displaced by senior full-term strikers as an unlawful employer tactic destructive to the right to strike?


Common examples of unlawful means are the sit-down strike, the partial strike, the wildcat strike, and the use of violence during strike activities. With respect to violence, a distinction is drawn between aggravated violence, which deprives employees of the Act’s protection, and less aggravated acts of misconduct, which do not deprive employees of protection.24 This distinction is illustrated in the Ohio Power decision, which follows.

In the Winston-Salem Journal decision, the Board determined that a union officer’s cursing and disruptive behavior did not cause loss of protected status because he was speaking out about unfair treatment at work in a meeting with his employer.25 However, the U.S. Court of Appeals denied enforcement of the Board’s order, holding that the speech in question using language such as “b___d,” “a redneck son of a b___h,” and other words of a similar nature are devoid of sub- stantive content and of meaningful value that could convey a message of grievance or concern.26


ENGEL, C. J.… In the early morning hours of October 21, 1973, a truck collided with a power pole adjacent to a two- lane asphalt highway outside the corporate limits of Bellaire, Ohio. The collision severed the pole in half, severely damaged the truck, and shut off electrical power in the vicinity. Alvin E. Mayer, a working foreman, and Kenneth Dawson, an area foreman, were reached at their home and together they trav- eled in one of the company’s 35 ft. elbow trucks to the scene to restore electric service and to remove the pole butt which was then blocking the road. Dawson and Mayer arrived upon the scene at approximately 1:30 AM and brought their truck to a halt in the eastbound lane of the road just west of the accident scene. Meanwhile word of the power failure had reached a striking employee, Joseph Campbell, who lived nearby. Campbell and two other striking employees, Larry Campbell and Gabriel Gasbarre, drove to the scene, arriving there in advance of the company truck bringing Mayer and Dawson. Shortly before, Joseph

Campbell had an unsatisfactory telephone conversa- tion with the dispatcher on duty in the company offices in an effort to find out what had happened and what was being done to correct the power shutoff. The three strikers brought picket signs with them, but upon arrival, decided to leave them in the car….

According to Mayer, following a conversation between himself and Joseph Campbell in the middle of the road, Mayer turned toward the accident scene only to have Campbell grab him from behind and throw him to the ground, Mayer falling on his left side but sustaining only a scraped elbow and [a scraped] small finger.

In contrast, Joseph Campbell claimed that the two men were talking when Campbell slipped down off the truck and collided “chest-to-chest” with Mayer, causing him to slip and fall on gravel which had accu- mulated on the pavement.

Mayer and Dawson reported the incident to the company that night, and thereafter a letter was sent to Joseph Campbell notifying him that he was


24 Cook Family Foods, Inc., 323 NLRB 413 (1997). 25 341 NLRB No. 18 (2004). 26 394 F.3d 207 (4th Cir. 2005).


discharged for an “act of unprovoked aggression against a supervisor.”

The company contends that Campbell’s conduct was sufficiently serious to warrant discharge. The company notes that it is undisputed that at the time when the repair truck arrived on the scene, Campbell left the group of onlookers and began talking to Mayer about how thin his patience was growing, and that the exchange between the two men was heated. Further … it is undisputed that Campbell came down from the fender of the repair truck where he was sitting and collided with Mayer, knock- ing Mayer backwards and onto the ground. Further, Campbell thereafter attempted to interfere with efforts to remove the broken utility pole and reopen the blocked highway to traffic, until directed to refrain by a police officer at the scene.

We begin our analysis by noting our standard of review … on this point:

[N]ot every impropriety committed during [Section 7] activity places the employee beyond the protective shield of the act. The employee’s right to engage in concerted activity may permit some leeway for impulsive behavior, which must be balanced against the employer’s right to maintain order and respect….

We have recognized in many cases that an employer is not required to countenance all miscon- duct by an employee, and we have carefully examined the acts of the employee to determine whether they are beyond the pale of protected activity under Section 7….

We conclude that Campbell’s misconduct was suf- ficiently serious to justify his dismissal…. The super- visors were engaged in emergency repair work at approximately 1:30 AM. When the truck arrived, Campbell left the area where the other strikers and the onlookers were gathered and jumped up on the fender of the company’s truck. The record indicates that at this point the two supervisors had just begun to survey the area where the accident had occurred, and did not as yet know whether there were any downed power lines or live wires.

According to Campbell’s own testimony, he began a discussion with Mayer stating how his patience was getting thin. Apparently, Campbell’s statements angered Mayer because at this point Mayer came at

Campbell and as Campbell arose from the truck, the two men bumped “chest-to-chest.” The force of the collision knocked Mayer back and he slipped onto the ground. He sustained slight injuries from the fall. Although there was no evidence that either man had to be restrained subsequent to the bumping inci- dent, onlookers apparently considered the situation quite serious. Police Officer Warnock testified that immediately after Mayer fell, he came over to Camp- bell and told him to back away, so there would not be any trouble…. [The Court found that as a result, the Company was within its rights to discharge Campbell.]

The facts leading to Larry Greene’s discharge are in most respects undisputed. On August 10, 1973, Greene and two other strikers were walking to picket the site of a repair job being performed by the com- pany in Steubenville. As Greene and the others reached the southeast corner of the intersection of North and 4th Streets, a company truck which had just left the worksite stopped for a red light at the intersection. In it were line foreman Ross Lee Cunningham and working foreman Walt Williams. Cunningham was driving. Greene yelled “Don’t you know we’re on strike?” and made some comments that the two non-union men were not observing safety rules. Greene then ran out into the intersection, grabbed Cunningham’s cigar from his mouth and threw it to the ground. Based solely upon this inci- dent, Greene was discharged.

The conduct complained of was an isolated expression which did not upon the circumstances create a safety hazard jeopardizing either company equipment or personnel. At the time of his discharge Greene was the Recording Secretary for the Union and the evidence suggests that the incident was exaggerated and that Greene’s discharge for the alleged misconduct was pretextual…. [The Court held that] Greene’s admitted misconduct was not so serious as to justify his discharge….

Case Questions

1. What balancing test does the court employ in determining whether an employee’s act of vio- lence justifies the employee’s dismissal?

2. Why does the court find that Greene’s dismissal was not justified?



Section 8(d) of the NLRA imposes a mandatory duty upon the parties to negotiate in good faith to reach an agreement concerning wages, hours, and other terms and conditions of employment. The Labor Management Relations Act of 1947 estab- lished the Federal Mediation and Conciliation Service (FMCS) to assist the parties in resolving any impasse concerning the achievement of initial agreements or the renegotiation of existing agreements. Section 8(d)(1) requires the party desiring to modify an existing agreement to serve written notice on the other party within 60 days of the expiration of a collective bargaining contract, and Section 8(d)(3) requires notice to the FMCS and any comparable state agency within 30 days after the Section 8(d)(1) notice of the existence of a dispute is given. Section 8(d)(4) provides for a 60-day cooling-off period after notice is given to the FMCS during which neither strikes nor lockouts may occur.

Section 8(d) provides a severe penalty for engaging in a strike without the requi- site written notice being given, that is, the individuals forfeit their status as employees under the Act and become unprotected activity strikers. In Boghosian Raisin Packing Co.,27 Teamsters Local 616 drafted a written notice to FMCS on February 19, 1999, of a pending dispute with the employer raisin packing company as mandated under Section 8(d)(3), but inadvertently failed to mail the notice. After negotiations broke down in late September, the union notified the company that it had complied with Section 8(d)’s notice requirements to the FMCS and would strike on October 1. The company’s attorney contacted the FMCS and found out that the union had not filed the required notice. The union struck on October 1. On the afternoon of October 1, 1999, when the union learned from the company’s attorney that the FMCS notice had not been given, it offered to return to work and resume negotiations. The strike continued to October 5, 1999, when the company terminated 42 of the 45 strikers. A Board majority determined that the strikers lost their protected status as employees by going on strike without giving the Section 8(d)(3) notice to the FMCS. Replace- ment workers were subsequently hired, and thereafter the company legally withdrew recognition of the union.

In 1974, the NLRA was amended to cover employees working in private hospitals. Expanded notice periods were incorporated into Section 8(d) to facili- tate the peaceful settlement of the health care disputes. Section 8(g) of the NLRA requires that a 10-day notice be given to a health care institution and the FMCS of a labor organization’s intent to strike or picket. The notice is intended to provide the health care institution with advance warning of strike and picket activity so that it can make arrangements for the continued care of patients.

Any employee who engages in a strike during any of the notice periods set forth in Section 8(d) or 8(g) would lose the protections of the NLRA, becoming an unprotected activity striker, as discussed in the previous section.

27 342 NLRB No. 32 (2004).


In Minnesota Licensed Practical Nurses Ass’n v. NLRB, presented in this section, the Eighth Circuit Court of Appeals upheld a 3–2 Board decision that 22 LPNs who began a strike four hours after the time designated in their Section 8(g) notice lost their protected employees’ status under the Section 8(d) so-called “loss of status” provision.


[The union is the certified collective bargaining repre- sentative of LPNs employed by the Alexandria Clinic. In August 1999, after months of unsuccessful bargain- ing, the clinic announced that it would implement its final offer. In response, the nurses voted to strike. The union gave the 10 days’written notice required by § 8(g), advising the clinic that the strike would commence at 8:00 AM on September 10, 1999. However, the union secretly advised the nurses that they could delay the commencement of the strike up to 72 hours.1 The strike leaders decided that the bargaining unit nurses should report for duty on September 10 and walk off the job at noon. They did not notify the clinic of this plan. On the morning of September 10, temporary replacement nurses hired by the clinic reported before 8:00. Fourteen bargaining unit nurses also reported for duty without warning. The clinic responded by having the replacements wait in a lounge area so as not to dis- turb the patients. The bargaining unit nurses left just before noon, again without warning the clinic or their supervising physicians. Eight other nurses not on duty that morning later joined the strike. Patient care was not affected, as the replacement nurses were present to take over at noon on September 10. Citing the strike delay without notice, the clinic fired the striking nurses for engaging in unlawful activity. After a hearing, the administrative law judge held that the union did not violate § 8(g) and therefore the clinic committed an unfair labor practice by discharging the nurses. A divided Board reversed. The union petitioned the Court of Appeals to review the Board’s decision.]

LOKEN, C. J.… The Board [stated]:

As made clear in Section 8(g), the “appropriate period” is the waiting period after a notice that gives the date and time for a strike. Obviously, if there is no notice, there can be no lawful strike.

Concededly, in the instant case, there was a notice and the employees did not strike within the period set by the notice. However, the employees did strike thereafter, and there was no notice with respect to that strike.… In sum, the strike was without notice, and it was therefore unlawful.

* * * … [T]his conclusion results in the nurses losing

their protected employee status under Section 8(d) for engaging in an unlawful strike, and subjects them to lawful discharge.

… The Union delayed the strike a disruptive one- half day with no notice of the delay. Prior to this case, the Board had never upheld this tactic.

The nurses engaged in a strike in violation of § 8(g), thereby lost their protected status by reason of § 8(d), and were lawfully discharged by their employer. The individual nurses may have acted in good faith in relying upon unsound advice from the Union and its legal counsel. But that does not justify rewarding their unlawful activity by imposing a back pay and reinstatement remedy on their employer, whose conduct was entirely lawful. The petition for review is denied.


Case Questions

1. Assess the “delayed start” tactic used by the union in this case.

2. What were the consequences of the unsound advice from the union in this case?

1An e-mail from the Union advisor to the nurses explained: “We can go at 8:00 [on Friday, September 10]; or just have everyone go to lunch and not come back; or work as usual on Friday, but not show up for Urgent Care Saturday—and have them wondering about Monday (when no one will come to work)!”



Because the purpose of collective bargaining is to promote industrial stability, it is common for the parties to negotiate a no-strike clause into their collective bargain- ing contracts. In the Standard Concrete Products case, reported in this section, the court points out that the right to strike may be relinquished by appropriate provi- sions in the collective bargaining agreements, provided the relinquishment is expressed in clear and unmistakable language. In Standard Concrete, however, the court found that there was not an explicit contractual waiver of the employees’ right to engage in a sympathy strike.

In John Morrell Co. v. UFCW, Local 304A,28 where workers at Morrell’s Sioux Falls plant engaged in a six-month sympathy strike in 1987 in support of striking Sioux City, Iowa, workers, Morrell sued the union, seeking damages for earnings lost because of the sympathy strike. A jury returned a verdict in favor of the company for $24.6 million in damages. The U.S. Court of Appeals for the Eighth Circuit ruled that the workers had engaged in an illegal sympathy strike and that the union was liable to the company for damages. The ruling was based on the no-strike clause in the contract, along with another provision of the contract that allowed Sioux Falls workers to refuse to perform work transferred from other meat-packing companies facing strikes but required workers to perform work transferred from other Morrell plants that were on strike. If employees could engage in sympathy strikes, the court said, such a provision would be meaningless.


[Teamsters Local 952 represented the employees at the Standard Concrete Products, Inc., plant in Corona, California. It also represented employees at three sites in Orange County, California, in a sep- arate bargaining unit with a separate collective bar- gaining agreement. Failing to make progress in negotiating a new collective bargaining agreement, Local 952’s Corona bargaining unit went on strike on January 5, 2000, and extended picket lines to the three facilities in Orange County. The Orange County bargaining unit participated in a sympathy strike and refused to cross the Corona bargaining unit’s picket line. The employer sued Local 952 in the U.S. district court for damages for breach of the no-strike clause in the Orange County CBA. From a

judgment for Standard Concrete for $802,237, the union appealed.]

PREGERSON, C. J.… Section 7 of the National Labor Relations Act guaran- tees workers and unions the right to engage in a sym- pathy strike, i.e., to refuse to cross the picket line of another bargaining unit that is on strike against its employer. Oil, Chem. and Atomic Workers Int’l Union, Local 1-547 v. NLRB, 842 F.2d 1141, 1143 (hereinafter Local 1-547) (9th Cir. 1988). The right to strike and sympathy strike may be waived in a CBA. To do so, the union must make a “clear and unmistak- able” waiver in the CBA. Children’s Hosp., 283 F.3d at 1192; Local 1-547, 842 F.2d at 1143. We require a


28 949 F.2d 266 (8th Cir. 1990). But see Englehard Corp., 342 NLRB No. 5 (2004).



Section 4 of the Norris-LaGuardia Act prohibits federal court injunctions in labor disputes. Section 301 of the Labor Management Relations Act provides that employers and unions may sue each other whenever a breach of a collective bargaining contract takes place. Section 301, however, does not include any statu- tory provision insulating cases brought under Section 301 from the prohibition against injunctions in the Norris-LaGuardia Act. Are federal courts then allowed to use the injunction as a remedy in cases for breach of collective bargaining agreement (Section 301)? We must analyze the Supreme Court decisions that have construed these statutes for our answer.

In Textile Workers Union v. Lincoln Mills,29 the Supreme Court allowed the use of an injunction to compel an employer to fulfill its obligation to arbitrate under an existing collective bargaining agreement. However, in

specific “clear and unmistakable” waiver of a Union’s right to sympathy strike because:

[I]f a Union is negotiating away employees’ rights that are fundamental to the collective bargaining process, any proposed contract must unambiguously put those employees on notice of the waiver.

Children’s Hosp., 283 F.3d at 1192.

In Children’s Hospital we made clear that “[a] general no-strike clause that does not specify whether sympathy strikes are included or excluded does not, simply by virtue of its incorporation in a collective bargaining agreement, constitute such a clear and unmistakable waiver [of sympathy strikes].” Children’s Hosp., 283 F.3d at 1192. We must “examine the relevant extrinsic evidence to determine if the parties intended that general [no- strike] language to include sympathy strikes.” Id. at 1194. The burden is on the “employer to show by clear and unmistakable evidence that a general waiver of the right to strike includes sympathy strikes.” Id. at 1195.…

We find that Children’s Hospital is controlling. There is evidence in the express text of the Orange

County CBA that the parties did not intend to bar sympathy strikes when they agreed to a general no strike clause. Article IX, Section 1 of the Orange County CBA provides: “No employee shall be dis- charged or discriminated against because of his/her membership in the Union or Union activities, includ- ing his/her refusal to cross a picket line approved by the Union.” If Standard Concrete intended the no strike clause to encompass a ban on sympathy strikes, it would not have agreed to safeguard the jobs of Local 952 members that refuse to cross a picket line.

We conclude that Local 952 did not make a clear and unmistakable waiver of its members’ right to refuse to cross the picket line of another union or bargaining unit of the same union.


Case Questions

1. What is a “sympathy strike?” 2. Does a general no-strike clause that does

not reference sympathy strikes constitute a waiver of the right to participate in a sympathy strike?

29 353 U.S. 448 (1957).


Sinclair Refining Co. v. Atkinson,30 the Court refused to enjoin a strike by a union, even though the collective bargaining agreement in effect at the time of the strike contained a no-strike clause and an arbitration clause. In Sinclair, Mr. Justice Black wrote for the majority that Section 301 did not modify the Norris-LaGuardia Act insofar as the statute prohibited injunctions in labor dis- putes and that federal district courts were without jurisdiction to order injunc- tive relief. In Avco Corp. v. Aero Lodge,31 the Supreme Court in effect negated the employer’s right to seek injunctive relief to enforce a no-strike clause in a state court (remember, Norris-LaGuardia prohibitions against the use of injunctions apply only to federal courts) by allowing the union to remove the case from the state court to a federal court. The Boys Markets decision, reported in this section, overruled Sinclair. In Boys Markets, the Supreme Court held that there must be an accommodation between the seemingly absolute terms of the Norris-LaGuardia Act and the policy considerations underlying Section 301. The Court concluded that the federal courts do have limited injunctive powers in Section 301 cases. The Court does caution that this decision is “a narrow one,” and only under certain limited circumstances may a court enjoin a strike in violation of a contractual no-strike clause.

In the Buffalo Forge Co. v. Steelworkers32 decision, the Supreme Court held that a prerequisite for the issuance of Boys Markets injunctive relief is that the strike must be over an issue that the parties are obligated to arbitrate. In Buffalo Forge, two production and maintenance locals of the Steelworkers were parties to collective bargaining agreements containing broad no-strike clauses and grievance arbitration procedures. Two office and technical employee units were certified as Steelworkers locals. After several months of negotiations for a first contract with the employer, the office employees went on strike. Several days later, the produc- tion and maintenance employees went on strike. The company sought an injunc- tion against this strike. The Court held that because the cause of the sympathy strike—the impasse in the office workers’ negotiations—was not subject to arbitra- tion between the production workers and the company, the relief sought was not granted. The Court ruled that the Boys Markets exception to the Norris- LaGuardia Act was limited to arbitrable disputes and that the Norris-LaGuardia Act, aside from the Boys Markets exception, does not permit the intrusion of the courts at the preliminary injunction stage to enjoin actual or threatened contract violations.

Following the Buffalo Forge precedent, the Supreme Court held in Jacksonville Bulk Terminals v. International Longshoremen’s Ass’n [ILA] that an employer may not obtain injunctive relief pending arbitration when the dispute underlying the work stoppage is not arbitrable. In Jacksonville Bulk Terminals, the underlying dispute related to the then Soviet Union’s intervention in Afghanistan, which led the ILA to refuse to handle goods arriving from or destined for the Soviet Union.

30 370 U.S. 195 (1962). 31 390 U.S. 557 (1968). 32 428 U.S. 397 (1976).


This dispute, the Court majority held, was plainly not arbitrable under the collec- tive bargaining agreement.33


[Boys Markets, Inc. (petitioner), had a collective bar- gaining agreement with the Retail Clerks Union (respondent). A company supervisor and certain other company employees who were not part of the Retail Clerks bargaining unit rearranged merchandise in the frozen food cases of one of the company’s supermarkets. A union representative insisted that the merchandise be restocked by union personnel, because the bargaining unit work had been wrong- fully taken away from union personnel. When Boys Markets refused to do so, a strike was called, and the union began to picket the market. The company sought an injunction against the strike and an order compelling arbitration of the dispute, as the collective bargaining agreement contained a no-strike clause and a grievance-arbitration procedure to resolve dis- putes under the agreement. Upon removal from a state court, the U.S. district court ordered the parties to arbitrate the dispute and enjoined the strike. The court of appeals reversed, considering itself bound by the Sinclair decision. The Supreme Court granted certiorari.]

BRENNAN, J.… At the outset, we are met with respondent’s conten- tion that Sinclair ought not to be disturbed because the decision turned on a question of statutory con- struction which Congress can alter at any time. Since Congress has not modified our conclusions in Sinclair, even though it has been urged to do so,

respondent argues that principles of stare decisis should govern the present case.

We do not agree that the doctrine of stare decisis bars a re-examination of Sinclair in the circum- stances of this case. We fully recognize that impor- tant policy considerations militate in favor of continuity and predictability in the law. Neverthe- less, as Mr. Justice Frankfurter wrote for the Court, “[S]tare decisis is a principle of policy and not a mechanical formula of adherence to the latest decision, however recent and questionable, when such adherence involves collision with a prior doc- trine more embracing in its scope, intrinsically sounder, and verified by experience.” It is precisely because Sinclair stands as a significant departure from our otherwise consistent emphasis upon the congressional policy to promote the peaceful settle- ment of labor disputes through arbitration and our efforts to accommodate and harmonize this policy with those underlying the anti-injunction provisions of the Norris-LaGuardia Act that we believe Sinclair should be reconsidered. Furthermore, in light of developments subsequent to Sinclair, in particular our decision in Avco Corp. v. Aero Lodge, 735, 390 U.S. 557 (1968), it has become clear that the Sin- clair decision does not further but rather frustrates realization of an important goal of our national policy.

Nor can we agree that conclusive weight should be accorded to the failure of Congress to respond to


33 Note that in a case arising out of the same ILA protest of the Soviet intervention in Afghanistan and involving an importer, Allied International and J.T. Clark Stevedoring Co., the union refusal to unload Russian goods on ships docking in Boston was found to be an unlawful secondary boycott in violation of Section 8(b)(4)(B) of the NLRA. The case, International Longshoremen’s Ass’n v. Allied International, Inc., 456 U.S. 212 (1982), was brought against the ILA under Section 303 of the LMRA for damages caused by the boycott. Following the Supreme Court’s decision in Jacksonville, the U.S. district court entered a judgment of $8,055,490 plus interest in favor of Allied, which was upheld on appeal. See Allied Plywood Corp. v. ILA, 814 F.2d 32 (1st Cir. 1987).


Sinclair on the theory that congressional silence should be interpreted as acceptance of the decision. The Court has cautioned that “[i]t is at best treach- erous to find in congressional silence alone the adoption of a controlling rule of law.” Therefore, in the absence of any persuasive circumstances evidencing a clear design that congressional inaction be taken as acceptance of Sinclair, the mere silence of Congress is not a sufficient reason for refusing to reconsider the decision.

We have also determined that the dissenting opinion in Sinclair states the correct principles con- cerning the accommodation necessary between the seemingly absolute terms of the Norris-LaGuardia Act and the policy considerations underlying Section 301(a). Although we need not repeat all that was there said, a few points should be empha- sized at this time.

The literal terms of Section 4 of the Norris- LaGuardia Act must be accommodated to the subse- quently enacted provisions of Section 301(a) of the Labor-Management Relations Act and the purposes of arbitration. Statutory interpretation requires more than concentration upon isolated words; rather, con- sideration must be given to the total corpus of the pertinent law and the policies which inspired ostensi- bly inconsistent provisions.

The Norris-LaGuardia Act was responsive to a situation totally different from that which exists today. In the early part of this century, the federal courts generally were regarded as allies of manage- ment in its attempt to prevent the organization and strengthening of labor unions; and in this industrial struggle the injunction became a potent weapon which was wielded against the activities of labor groups. The result was a large number of sweeping decrees, often issued ex parte, drawn on an ad hoc basis without regard to any systematic elaboration of national labor policy.

In 1932 Congress attempted to bring some order out of the industrial chaos that had developed and to correct the abuses which had resulted from the interjection of the federal judiciary into union- management disputes on the behalf of management. See Declaration of Public Policy, Norris-LaGuardia Act, Section 2, 47 Stat. 70 (1932). Congress, there- fore, determined initially to limit severely the power of the federal courts to issue injunctions “in any case involving or growing out of any labor dispute….” 47 Stat. 70. Even as initially enacted, however, the prohibition against federal injunctions

was by no means absolute. See Norris-LaGuardia Act, Sections 7, 8, 9, 47 Stat. 70 (1932). Shortly thereafter Congress passed the Wagner Act, designed to curb various management activities which tended to discourage employee participation in collective action.

As labor organizations grew in strength and developed toward maturity, congressional emphasis shifted from protection of the nascent labor move- ment to the encouragement of collective bargaining and administrative techniques for the peaceful reso- lution of industrial disputes. This shift in emphasis was accomplished, however, without extensive revi- sion of many of the older enactments, including the anti-injunction section of the Norris-LaGuardia Act. Thus it became the task of the courts to accommo- date, to reconcile the older statutes with the more recent ones.

The principles elaborated in Trainmen v. Chicago River R.R., 353 U.S. 30 (1957), are equally applica- ble to the present case. To be sure, Chicago River involved arbitration procedures established by stat- ute. However, we have frequently noted, in such cases as Lincoln Mills, the Steelworkers Trilogy, and Lucas Flour, the importance which Congress has attached generally to the voluntary settlement of labor disputes without resort to self-help and more particularly to arbitration as a means to this end. Indeed, it has been stated that Lincoln Mills, in its exposition of Section 301(a), “went a long way towards making arbitration the central institution in the administration of collective bargaining contracts.”

The Sinclair decision, however, seriously under- mined the effectiveness of the arbitration technique as a method peacefully to resolve industrial disputes without resort to strikes, lockouts, and similar devices. Clearly, employers will be wary of assum- ing obligations to arbitrate specifically enforceable against them when no similarly efficacious remedy is available to enforce the concomitant undertaking of the union to refrain from striking. On the other hand, the central purpose of the Norris-LaGuardia Act to foster the growth and viability of labor orga- nizations is hardly retarded—if anything, this goal is advanced—by a remedial device which merely enforces the obligation that the union freely under- took under a specifically enforceable agreement to submit disputes to arbitration. We conclude, therefore, that the unavailability of equitable relief in the arbitration context presents a serious impediment



to the congressional policy favoring the voluntary establishment of a mechanism for the peaceful resolution of labor disputes, that the core purpose of the Norris-LaGuardia Act is not sacrificed by the limited use of equitable remedies to further this important policy, and consequently that the Norris-LaGuardia Act does not bar the granting of injunctive relief in the circumstances of the instant case.

Our holding in the present case is a narrow one. We do not undermine the vitality of the Norris- LaGuardia Act. We deal only with the situation in which a collective bargaining contract contains a mandatory grievance adjustment or arbitration proce- dure. Nor does it follow from what we have said that injunctive relief is appropriate as a matter of course in every case of a strike over an arbitrable grievance. The dissenting opinion in Sinclair suggested the following principles for the guidance of the district courts in determining whether to grant injunctive relief—principles which we now adopt:

A District Court entertaining an action under Section 301 may not grant injunctive relief against concerted activity unless and until it decides that the case is one in which an injunc- tion would be appropriate despite the Norris- LaGuardia Act. When a strike is sought to be enjoined because it is over a grievance which both parties are contractually bound to arbi- trate, the District Court may issue no injunctive order until it first holds that the contract does have that effect; and the employer should be ordered to arbitrate, as a condition of his obtaining an injunction against the strike. Beyond this, the District Court must, of course, consider whether issuance of an injunction would be warranted under ordinary principles of equity—whether breaches are occurring and will continue, or have been threatened and will be committed; whether they have caused or will cause irreparable injury to the employer; and whether the employer will suffer more from the denial of an injunction than will the union from its issuance. 370 U.S., at 228.

In the present case there is no dispute that the grievance in question was subject to adjustment

and arbitration under the collective bargaining agreement and that the petitioner was ready to pro- ceed with arbitration at the time an injunction against the strike was sought and obtained. The District Court also concluded that, by reason of respondent’s violations of its no-strike obligation, petitioner “has suffered irreparable injury and will continue to suffer irreparable injury.” Since we now overrule Sinclair, the holding of the Court of Appeals in reliance on Sinclair must be reversed. Accordingly, we reverse the judgment of the Court of Appeals and remand the case with directions to enter a judgment affirming the order of the District Court.

It is so ordered.

BLACK J., Dissenting … Although Congress has been urged to overrule our holding in Sinclair, it has steadfastly refused to do so.

… When the law has been settled by an earlier case then any subsequent “reinterpretation” of the statute is gratuitous and neither more nor less than an amendment: it is no different in effect from a judi- cial alteration of language that Congress itself placed in the statute.

Altering the important provisions of a statute is a legislative function. And the Constitution states sim- ply and unequivocally: “All legislative Powers herein granted shall be vested in a Congress of the United States….” U.S. Const., Art. I. It is the Con- gress, not this Court, that responds to the pressures of political groups, pressure entirely proper in a free society….

Case Questions

1. How did the labor dispute that led to this liti- gation arise?

2. What are the issues before the Supreme Court? 3. Does the majority believe that the doctrine of

stare decisis bars a reexamination of the Sinclair decision handed down in 1962?

4. What guiding principles adopted by the Court are to be utilized by district courts in determining whether to grant injunctive relief?



Limitations are imposed on the use of the federal court injunction by the Federal Anti-Injunction Act of 1932. However, these restrictions do not apply to suits initiated by the government to protect the public interest from actual or threatened national emergency strikes.34

Several strikes in 1946, particularly in the bituminous coal industry, were stimulants for inclusion of Section 3 206–210, dealing with national emergencies, in the Labor Management Relations Act (Taft-Hartley Act or LMRA) of 1947. These are in purpose parallel to Section 10 of the Railway Labor Act.

Under these provisions of the Act, as in the emergency strike provisions of the Railway Labor Act, the president is authorized to appoint a board of investiga- tion, which submits a report to the president concerning the issues in dispute. The Labor Management Relations Act of 1947, in Sections 206–210, enables the government to secure what amounts to an 80-day injunction forestalling strikes or lockouts affecting all or a substantial part of an industry in interstate commerce when such disputes imperil the national health or safety. During the interim, the government mediation service is to be invoked, but recommenda- tions for settlement are not mandatory on the disputants. If an accord is not reached, the NLRB must poll the workers as to whether they want to accept the employer’s last offer in settlement. If the last offer is not acceptable, the injunc- tion is dissolved, and the president refers the case to Congress for such “appropri- ate action” as it deems advisable.

The Taft-Hartley provisions do not provide for a compulsory method of dis- pute settlement, but rather leave ultimate disposition of an unresolved national emergency case in the hands of Congress upon referral by the president. The Act of 1947, Sections 206–210, expresses congressional intentions to leave open all legitimate methods of labor union self-help, subject to delaying action by presiden- tial injunctive intervention. The Act provides facilities for mediation and concilia- tion in the hope that the parties will reach a settlement and avoid a crippling strike.

In United Steelworkers of America v. United States,35 the Supreme Court upheld the authority of the government to secure an injunction under Sections 206–210. In this case, a steel strike impeded production of vital weapons needed for defense.

At the other end of the spectrum, however, the Supreme Court in Youngs- town Sheet and Tube v. Sawyer36 denied that the existence of emergency alone, in the absence of prior congressional authority, gave the president consti- tutional power to effect a seizure of major American steel mills. The president attempted to accomplish this seizure by executive order in a steel strike stale- mate in 1951.

34 See United States v. United Mine Workers, 330 U.S. 258 (1947). 35 361 U.S. 39 (1959). 36 343 U.S. 579 (1952).


Presidential action was initiated in October 2002 to deal with a prolonged dispute between the Pacific Maritime Association (PMA) and the International Longshore and Warehouse Union (ILA), in order to interrupt a lockout by the PMA affecting 29 ports on the West Coast and some 10,500 longshore workers. The lockout began on September 27, 2002, and presidential action under the Taft- Hartley Act was invoked on October 7, 2002. The U.S. district court’s order approving a stipulated preliminary injunction is set forth in this section. The parties were able to resolve their dispute during the 80-day cooling-off period imposed under Taft-Hartley.


ALSUP, J.… Introduction

In this action for injunctive relief under the emergency provisions of the Labor Management Relations Act of 1947, commonly known as the Taft-Hartley Act, this order APPROVES the stipulation of the parties imposing injunctive relief.

Statement At the direction of President George W. Bush, the United States commenced this action for injunctive relief on October 8, 2002, under the emergency pro- visions of the Labor Management Relations Act of 1947, 29 U.S.C. 176-180. The President invoked the Act to interrupt a lockout by the Pacific Maritime Association and its members affecting 29 ports on the West Coast and 10,500 longshore workers represented by the International Longshore and Ware- house Union. The lockout began on September 27, following a breakdown in negotiations over a new collective-bargaining agreement, the old one having expired over the summer.

Prior to suit, on October 7, the President appointed a board of inquiry pursuant to Section 206 after finding that (1) the lockout affected a sub- stantial part of the maritime industry and (2) the lockout, if permitted to continue, would imperil national health and safety. The board of inquiry issued its report on October 8. The board concluded that the PMA and the ILWU would not resolve the port shutdown within a reasonable time. After

receiving the report, the President directed the Attor- ney General to initiate this action …

Analysis Section 208 of the Taft-Hartley Act provides:

Upon receiving a report from a board of inquiry the President may direct the Attorney General to petition any district court of the United States having jurisdiction of the parties to enjoin such strike or lockout or the continuing thereof, and if the court finds that such threatened or actual strike or lockout— (i) affects an entire industry or a substantial part

thereof engaged in trade, commerce, transporta- tion, transmission, or communication among the several States or with foreign nations, or engaged in the production of goods for commerce; and (ii) if permitted to occur or to continue, will

imperil the national health or safety, it shall have jurisdiction to enjoin any such strike or lockout, or the continuing thereof, and to make such other orders as may be appropriate.

29 U.S.C. 178(a). For the reasons stated at the hearing on October 8 … this order finds that both statutory factors have been met.

With respect to the first statutory factor, the lockout at 29 ports along the West Coast and resultant work stoppage have affected a substantial part of the nation’s maritime industry, an industry intimately engaged in“trade, commerce, transportation,



transmission, or communication among the several States or with foreign nations.” Specifically, the 29 affected West Coast ports are crucial gateways to America’s trade routes to Asia and the Pacific. Indeed, the affected ports annually handle over 50 percent of the nation’s containerized imports and exports, with a total annual value of bulk cargo at $300 billion.…

The second statutory factor is met as well. The lockout and resultant work stoppage “if permitted to occur or to continue, will imperil the national health or safety.” 29 U.S.C. 178(a)(ii). This order reiterates the finding made in open court on October 8 that both national health and national safety will be imperiled by the lockout’s continuation. A con- tinuation of the closure of West Coast ports will endanger the national economy and labor force. Key industries directly and substantially affected, as stated, include the transportation and agricultural industries. Continuation of the closure would harm the national economy still recovering from recession.

At the October 8 hearing, the ILWU raised two points. It first argued that the invocation of the Taft-Hartley Act was the product of “collusion” between the United States and the PMA. This was rejected as speculation and, at all events, beside the point, since all persons, including both the PMA and the ILWU, have the right to petition the government for redress of grievance. The focus must be on whether the government has proven the statutory pre- conditions for emergency relief—not on the politics behind its decision to seek relief. The ILWU’s second argument was that the lockout was on the verge of collapsing and, thus, there was no need for injunctive relief. This was rejected on the facts given the govern- ment’s powerful showing of the massive logjam of imports and exports paralyzing the West Coast. Even if the lockout eventually might have collapsed of its own weight, estimating when a voluntary end to the shutdown might have come would have been guesswork. Again, the statutory findings are plainly indicated. That is the end of the inquiry at the district court. United Steel Workers of America v. United States, 361 U.S. 39, 41 (1959).

… [T]he Court has considered on its own whether a Taft-Hartley injunction provoked by a management lockout, as here, can be directed not only at the lockout but also at any future strike or

other work slowdown by a union. This case is evi- dently the first to arise primarily from a lockout. This order concludes that in such circumstances the injunction may extend beyond enjoining a lockout and also may enjoin a strike, including a work slow down. The Act expressly refers to a “threat- ened … strike” as a basis for an injunction. “The term ‘strike’ includes … any concerted slow-down or other concerted interruption of operations by employees.” 29 U.S.C. 142(2). The findings of the board of inquiry demonstrate that the lockout was, at least in part, occasioned by work slow-downs in various ports. In this charged environment, it is clear that a “strike” is “threatened” within the meaning of the Act. Although the massive gridlock at West Coast ports is primarily attributable to the PMA’s lockout, and although the lockout will now be enjoined, concerted slow-downs by longshore workers would greatly exacerbate an existing national emergency. Therefore, there is a sufficient basis to extend the injunction to prohibit both lock- outs and strikes at this juncture.

Moreover, in the past Taft-Hartley decisions gen- erated by strikes, the preliminary injunctions swept broadly to prohibit both strikes and lockouts, at least insofar as can be determined from the pub- lished decisions. At all events, under Section 208 of the Act, the Court has the authority “to make such other orders as may be appropriate.” 29 U.S.C. 178(a)(ii) …

Conclusion For the reasons stated, this order APPROVES the stipulated preliminary injunction.

It is so ordered.

Case Questions

1. Did the ILA prove that the invocation of the Taft-Hartley Act was the product of “collu- sion” between the United States and the PMA?

2. The 2002 case was the first case to arise pri- marily from a lockout by an employer. Did the court have the right to issue a Taft-Hartley injunction not only against the lockout but also against any future strike?



1. Distinguish between economic, unprotected, and employer unfair-labor-practice strikes.

2. What are the reinstatement rights of economic strikers as opposed to unfair- labor-practice strikers?

3. Evaluate the effectiveness of the strike weapon for unions versus the employers’ economic weapons.

4. The International Ladies Garment Workers’ Union obtained 59 signed authorization cards from the 86 employees at the Robin- American Zipper factory in Hialeah, Florida. In late November, the union informed the president of the company, Benbast, that it wanted to be recognized as the repre- sentative for the employees. Benbast insisted upon an NLRB election, and one was scheduled for the following March. Between November and January, supervisors and managers interrogated a number of employees who had signed authorization cards and threatened some with dismissal if the union won the election. In De