National Labor Relations Board v. Truitt Manufacturing Co
| Decision Date | 07 May 1956 |
| Docket Number | No. 486,486 |
| Citation | 100 L.Ed. 1027,76 S.Ct. 753,351 U.S. 149 |
| Parties | NATIONAL LABOR RELATIONS BOARD, Petitioner, v. TRUITT MANUFACTURING CO |
| Court | U.S. Supreme Court |
Mr.
David P. Findling, Washington, D.C., for petitioner.
Mr. R. D. Douglas, Jr., Greensboro, N.C., for respondent.
The National Labor Relations Act makes it an unfair labor practice for an employer to refuse to bargain in good faith with the representative of his employees.1 The question presented by this case is whether the National Labor Relations Board may find that an employer has not bargained in good faith where the employer claims it cannot afford to pay higher wages but refuses requests to produce information substantiating its claim.
The dispute here arose when a union representing certain of respondent's employees asked for a wage increase of 10 cents per hour. The company answered that it could not afford to pay such an increase, it was undercapitalized, had never paid dividends, and that an increase of more than 2 1/2 cents per hour would put it out of business. The union asked the company to produce some evidence substantiating these statements, requesting permission to have a certified public accountant examine the company's books, financial data, etc. This request being denied, the union asked that the company submit 'full and complete information with respect to its financial standing and profits,' insisting that such information was pertinent and essential for the employees to determine whether or not they should continue to press their demand for a wage increase. A union official testified before the trial examiner that '(W)e were wanting anything relating to the Company's position, any records or what have you, books, accounting sheets, cost expenditures, what not, anything to back the Company's position that they were unable to give any more money.' The company refused all the requests, relying solely on the statement that 'the information * * * is not pertinent to this discussion and the company declines to give you such information; You have no legal right to such.'
On the basis of these facts the National Labor Relations Board found that the company had 'failed to bargain in good faith with respect to wages in violation of Section 8(a)(5) of the Act.' 110 N.L.R.B. 856. The Board ordered the company to supply the union with such information as would 'substantiate the Respondent's position of its economic inability to pay the requested wage increase.' The Court of Appeals refused to enforce the Board's order, agreeing with respondent that it could not be held guilty of an unfair labor practice because of its refusal to furnish the information requested by the union. 4 Cir., 224 F.2d 869. In National Labor Relations Board v. Jacobs Mfg. Co., 196 F.2d 680, the Second Circuit upheld a Board finding of bad-faith bargaining based on an employer's refusal to supply financial information under circumstances similar to those here. Because of the conflict and the importance of the question we granted certiorari. 350 U.S. 922, 76 S.Ct. 211.
The company raised no objection to the Board's order on the ground that the scope of information required was too broad or that disclosure would put an undue burden on the company. Its major argument throughout has been that the information requested was irrelevant to the bargaining process and related to matters exclusively within the province of management. Thus we lay to one side the suggestion by the company here that the Board's order might be unduly burdensome or injurious to its business. In any event, the Board has heretofore taken the position in cases such as this that 'It is sufficient if the information is made available in a manner not so burdensome or timeconsuming as to impede the process of bargaining.'2 And in this case the Board has held substantiation of the company's position requires no more than 'reasonable proof.'
We think that in determining whether the obligation of good-faith bargaining has been met the Board has a right to consider an employer's refusal to give information about its financial status. While Congress did not compel agreement between employers and bargaining representatives, it did require collective bargaining in the hope that agreements would result. Section 204(a) (1) of the Act admonishes both employers and employees to 'exert every reasonable effort to make and maintain agreements concerning rates of pay, hours, and working conditions * * *.'3 In their effort to reach an agreement here both the union and the company treated the company's ability to pay increased wages as highly relevant. The ability of an employer to increase wages without injury to his business is a commonly considered factor in wage negotiations.4 Claims for increased wages have sometimes been abandoned because of an employer's unsatisfactory business condition; employees have even voted to accept wage decreases because of such conditions.5
Good-faith bargaining necessarily requires that claims made by either bargainer should be honest claims. This is true about an asserted inability to pay an increase in wages. If such an argument is important enough to pre- sent in the give and take of bargaining, it is important enough to require some sort of proof of its accuracy. And it would certainly not be farfetched for a trier of fact to reach the conclusion that bargaining lacks good faith when an employer mechanically repeats a claim of inability to pay without making the slightest effort to substantiate the claim. Such has been the holding of the Labor Board since shortly after the passage of the Wagner Act. In Pioneer Pearl Button Co., decided in 1936, where the employer's representative relied on the company's asserted 'poof financial condition,' the Board said: 'He did no more than take refuge in the assertion that the respondent's financial condition was poor; he refused either to prove his statement, or to permit independent verification. This is not collective bargaining. 1 N.L.R.B. 837, 842—843. This was the position of the Board when the Taft-Hartley Act was passed in 1947 and has been its position ever since.6 We agree with the Board that a refusal to attempt to substantiate a claim of inability to pay increased wages may support a finding of a failure to bargain in good faith.
The Board concluded that under the facts and circumstances of this case the respondent was guilty of an unfair labor practice in failing to bargain in good faith. We see no reason to disturb the findings of the Board. We do not hold, however, that in every case in which economic inability is raised as an argument against increased wages it automatically follows that the employees are entitled to substantiating evidence. Each case must turn upon its particular facts.7 The inquiry must always be whether or not under the circumstances of the particular case the statutory obligation to bargain in good faith has been met. Since we conclude that there is support in the record for the conclusion of the Board here that respondent did not bargain in good faith, it was error for the Court of Appeals to set aside the Board's order and deny enforcement.
Reversed.
Mr. Justice FRANKFURTER, whom Mr. Justice CLARK and Mr. Justice HARLAN join, concurring in part and dissenting in part.
This case involves the nature of the duty to bargain which the National Labor Relations Act imposes upon employers and unions. Section 8(a)(5) of the Act makes it 'an unfair labor practice for an employer * * * to refuse to bargain collectively with the representatives of his employees,' and § 8(b)(3) places a like duty upon the union vis-a -vis the employer. Section 8(d) provides that 'to bargain collectively is 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, or the negotiation of an agreement, or any question arising thereunder, and the execution 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 * * *.' 61 Stat. 142, 29 U.S.C. § 158(d), 29 U.S.C.A. § 158(d).
These sections obligate the parties to make an honest effort to come to terms; they are required to try to reach an agreement in good faith. 'Good faith' means more than merely going through the motions of negotiating; it is inconsistent with a predetermined resolve not to budge from an initial position. But it is not necessarily incompatible with stubbornness or even with what to an outsider may seem unreasonableness. A determination of good faith or of want of good faith normally can rest only on an inference based upon more or less persuasive manifestations of another's state of mind. The previous relations of the parties, antecedent events explaining behavior at the bargaining table, and the course of negotiations constitute the raw facts for reaching such a determination. The appropriate inferences to be drawn from what is often confused and tangled testimony about all this makes a finding of absence of good faith one for the judgment of the Labor Board, unless the record as a whole leaves such judgment without reasonable foundation. See Universal Camera Corp. v. National Labor Relations Board, 340 U.S. 474, 71 S.Ct. 456, 95 L.Ed. 456.
An examination of the Board's opinion and the position taken by its counsel here...
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