United Steelworkers of America, AFL-CIO v. Fort Pitt Steel Casting, Div. of Conval-Penn, Inc., Div. of Conval Corp.

• Decision Date: 30 April 1979
• Docket Number: Nos. 78-2035,AFL-CIO and J,INC,CONVAL-PEN,78-2654 and 79-1019,s. 78-2035
• Citation: 598 F.2d 1273
• Parties: 101 L.R.R.M. (BNA) 2406, 86 Lab.Cas. P 11,296 UNITED STEELWORKERS OF AMERICA,ames Garry, Quinto Delissio, Patrick McGhen and Ernest A. Oblack, on behalf of themselves and others similarly situated, Appellees, v. FORT PITT STEEL CASTING, DIVISION OF, DIVISION OF CONVAL CORPORATION, Appellant.
• Court: U.S. Court of Appeals — Third Circuit

Page 1273

598 F.2d 1273

101 L.R.R.M. (BNA) 2406, 86 Lab.Cas. P 11,296

UNITED STEELWORKERS OF AMERICA, AFL-CIO and James Garry Quinto Delissio, Patrick McGhen and Ernest A Oblack, on behalf of themselves and others similarly situated, Appellees, v. FORT PITT STEEL CASTING, DIVISION OF CONVAL-PENN, INC DIVISION OF CONVAL CORPORATION, Appellant.

Nos. 78-2035, 78-2654 and 79-1019.

United States Court of Appeals Third Circuit.

Argued Feb. 21, 1979.

Decided April 30, 1979.

Rudolph L. Milasich, Jr. (argued), Carl B. Frankel, Pittsburgh, Pa., Bernard Kleiman, Chicago, Ill., for appellees.

Henry J. Wallace, Jr. (argued), Reed, Smith, Shaw & McClay, Pittsburgh, Pa., for appellant.

Before HUNTER and WEIS, Circuit Judges, and STAPLETON, ^* District Judge.

OPINION OF THE COURT

JAMES HUNTER, III, Circuit Judge:

These three consolidated appeals result from a longstanding labor dispute between Fort Pitt Steel Casting (Fort Pitt, or the Company) and the United Steelworkers of America (Steelworkers, or the Union). The Steelworkers are the exclusive bargaining agent for over 300 Fort Pitt employees at the Company's plant in McKeesport, Pennsylvania. On June 23, 1978, the district court enjoined Fort Pitt from terminating premium payments necessary to keep its employees' hospital and insurance benefits in effect during a labor dispute ¹ (No. 78-2035). Subsequently, on November 9, 1978, the district court held Fort Pitt in civil contempt for stopping the premium payments in violation of the injunction (No. 78-2654). Finally, on December 18, 1978, the court denied Fort Pitt's motion to vacate the injunction ² (No. 79-1019). We affirm the district court's orders in Nos. 78-2035 and 78-2654. However, in No. 79-1019, although we reject Fort Pitt's claim that the injunction be vacated immediately, we remand to the district court to determine whether the Company has permanently terminated all operations at the plant. If the court finds it has done so, then the injunction must be dissolved.

I FACTS

Fort Pitt and the Steelworkers executed a three year collective bargaining Agreement (Agreement) on March 3, 1975. Section 9 of the Agreement is entitled "Adjustment of Grievances." That section provides that the grievance procedures agreed upon by the parties culminate, if necessary, in binding arbitration, ³ that they apply to "(a)ny (employee) request or complaint," ⁴ The parties agree that in the event of a labor dispute at the end of termination of this Agreement, The Company will continue hospitalization and insurance benefits. At the end of said dispute, The Company will be reimbursed for payments made on behalf of the employees in payment methods mutually agreed on by the parties.

                and that "(t)he grievance procedure may be utilized by the Company in processing Company grievances."  5 Section 19 is entitled "Prior Agreements."  Paragraph 140 of that section provides
                

On March 3, 1978, the Agreement having expired and the parties having failed to reach a new contract, the Steelworkers began a lawful work stoppage. Pursuant to paragraph 140 of the 1975 agreement, Fort Pitt continued hospitalization and insurance coverage for its striking employees. As the strike continued, the parties engaged in negotiations for a new contract. In the course of those negotiations, the union denied that it was obligated by paragraph 140 to reimburse Fort Pitt for the benefit payments advanced by the Company during the work stoppage. ⁶

The Company considered the Union's refusal to commit itself to reimbursement to be in breach of paragraph 140. As a result, in a letter to the Union dated May 16, 1978, Fort Pitt threatened to discontinue making premium payments unless by June 1, 1978, the Union guaranteed in writing to provide repayment.

The Steelworkers declined to furnish the assurances sought by Fort Pitt and, in order to prevent the Company from carrying out its threat, sought injunctive relief in the Court of Common Pleas of Allegheny County. ⁷ The case was removed to the United States District Court for the Western District of Pennsylvania and, on June 7, 1978, the court entered a preliminary injunction barring Fort Pitt from:

Failing to advance and to pay, in a timely manner, the premiums necessary to keep (Fort Pitt employees') hospitalization and insurance policies in effect.

On June 23, 1978, the district court issued an opinion and amended order maintaining the preliminary injunction. ⁸ 452 F.Supp. 886. The court held that whether the Steelworkers were required by paragraph 140 to guarantee reimbursement was an arbitrable issue and that by threatening to cut off premium payments, instead of seeking arbitration, the Company was engaging in "self-help." Because the court found that the Company's self-help remedy tended to undermine the integrity of the arbitral process, and because it concluded that the union members were in danger of immediate and irreparable injury, the court held that a preliminary injunction prohibiting the Company from terminating payments was both lawful and appropriate under the doctrine of Boys Markets, Inc. v. Retail Fort Pitt initially complied with the preliminary injunction and negotiations for a new contract proceeded. Fort Pitt did not, however, seek to grieve the Union's alleged breach of the Agreement. On June 30, the Company proposed that paragraph 140 be changed so that the Company would make premium payments only during the first 30 days of a work stoppage. ¹⁰ The Union rejected this proposal. On September 13, the Company submitted a modified proposal which gave the Company the sole right to terminate contributions after the 30 day period had expired. ¹¹ This proposal, too, was promptly rebuffed.

Clerks Union, Local 770, 398 U.S. 235, 90 S.Ct. 1583, 26 L.Ed.2d 199 (1970). ⁹

Concluding that the parties had bargained to an impasse regarding paragraph 140, the Company unilaterally implemented its September 13 proposal. On October 16, it notified its employees by letter that because more than 30 days had elapsed since the new paragraph 140 had been implemented, it was exercising its right under the new provision to terminate the payments. The Steelworkers subsequently filed a "Motion for Adjudication of Civil Contempt" in the district court. In granting the motion, the court recognized that management is ordinarily entitled to implement its own proposals once an impasse is reached, but concluded that because of the "unique" nature of the old paragraph 140, "the Company ha(d) in effect bargained away its right to institute a unilateral change in this clause following an impasse."

On November 10, with the work stoppage continuing, the Company made a "last and final offer" for a new Agreement. This offer was rejected and on November 29, the Company announced that it was totally and permanently closing the plant effective November 30, 1978. Fort Pitt subsequently moved to vacate the June 7 and June 23 orders, contending that its obligation under paragraph 140 ended with the shut-down of the plant. At a hearing before the district court, the Company claimed that no future production of any kind was planned, that steps were being taken to cancel orders already accepted, and that service by various public utilities at the plant was being cancelled.

The Steelworkers argued that "recent experience" suggested that the Company's announcement was merely a ruse designed to avoid its obligations under paragraph 140. The Union also contended that production work was being performed after November 30 by supervisory personnel who crossed the picket lines at the plant, and that this work would take three to four months to finish.

The district court found that despite the Union's reservations, Fort Pitt did intend "to close the plant once 'winding down' operations are completed." Nevertheless, the court refused to vacate the injunction. Relying on Nolde Bros. v. Local 358, Bakery Workers, 430 U.S. 243, 97 S.Ct. 1067, 51 L.Ed.2d 300 (1977), it ruled that whether Fort Pitt's "obligations under Paragraph 140 terminated upon shutdown of its plant is an arbitrable issue," and that until the issue was resolved, the Company had no grounds to justify vacating the injunction.

II DISCUSSION

A. No. 78-2035

The Norris-LaGuardia Act, 29 U.S.C. §§ 101-115 (1976), limits the jurisdiction of federal courts to issue injunctive relief in cases involving labor disputes. Section 4(c) of that Act ¹² provides:

No court of the United States shall have jurisdiction to issue any . . . temporary or permanent injunction In any case involving or growing out of any labor dispute To prohibit any person or persons . . . from . . .

(c) Paying or giving to, or Withholding from, any person participating or interested in such labor dispute, any strike or unemployment benefits or insurance, or other moneys or things of value.

The Company claims that in terminating premium payments, it was "withholding . . . other monies or things of value" from participants in a labor dispute. As a result, it asserts that the June 7 and June 23 injunctions were prohibited by section 4(c). The Steelworkers argue, however, that the injunction was valid under the Boys Markets exception to the Norris-LaGuardia Act.

Boys Markets, Inc. v. Retail Clerks Union, Local 770, 398 U.S. 235, 90 S.Ct. 1583, 26 L.Ed.2d 199 (1970), involved the question whether section 4(a) of the Norris-LaGuardia Act ¹³ deprived a federal court of jurisdiction ¹⁴ to enjoin a strike in breach of a no-strike/compulsory arbitration provision in a collective bargaining agreement. The Supreme Court found that unless federal courts were permitted to grant injunctions forbidding unions from striking, unions would be free to ignore the compulsory arbitration clauses of their agreements. Id. at 248-49, 90 S.Ct. 1583. This, in the Court's view, would seriously damage "the congressional policy to promote the peaceful settlement of labor disputes through arbitration." Id. at 241, 90 S.Ct. at 1587. ¹...