National Ry. Labor Conference v. International Ass'n of Machinists and Aerospace Workers

• Decision Date: 21 September 1987
• Docket Number: 87-1151 and 87-1298,Nos. 87-1088,s. 87-1088
• Citation: 830 F.2d 741
• Parties: 126 L.R.R.M. (BNA) 2615, 107 Lab.Cas. P 10,203 NATIONAL RAILWAY LABOR CONFERENCE, et al., Plaintiffs-Appellees, v. INTERNATIONAL ASSOCIATION OF MACHINISTS AND AEROSPACE WORKERS, et al., Defendants-Appellants.
• Court: U.S. Court of Appeals — Seventh Circuit

Page 741

830 F.2d 741

126 L.R.R.M. (BNA) 2615, 107 Lab.Cas. P 10,203

NATIONAL RAILWAY LABOR CONFERENCE, et al., Plaintiffs-Appellees, v. INTERNATIONAL ASSOCIATION OF MACHINISTS AND AEROSPACE

WORKERS, et al., Defendants-Appellants.

Nos. 87-1088, 87-1151 and 87-1298.

United States Court of Appeals, Seventh Circuit.

Argued June 5, 1987.

Decided Sept. 21, 1987.

Michael S. Wolly, Mulholland & Hickey, Washington, D.C., for defendants-appellants.

Ralph J. Moore, Jr., Shea & Gardner, Washington, D.C., for plaintiffs-appellees.

Before COFFEY and FLAUM, Circuit Judges, and ESCHBACH, Senior Circuit Judge.

ESCHBACH, Senior Circuit Judge.

In this action the district judge issued a preliminary injunction to maintain the status quo and preserve the jurisdiction of the administrative railway adjustment boards over two disputes the district judge concluded were "minor disputes" under the Railway Labor Act. See 45 U.S.C. Sec. 151 et seq. The unions appeal the determination that the disputes are minor, the granting of the injunction against a strike, and its scope. The railroads appeal from the scope of the conditions on the injunction requiring them to maintain the status quo. We affirm the district court in all respects.

I

This litigation concerns two "third-party" contracts entered into in each instance between a railroad and a supplier of locomotives. Both contracts make the locomotive supplier responsible for the repair and maintenance of the locomotives. In both instances the unions argue that these third-party contracts violate existing collective bargaining agreements that the unions assert reserve such repair and maintenance work to their members. The railroads counter that the collective bargaining agreements authorize the third-party contracts.

The first third-party contract at issue involves a letter of intent entered into on September 4, 1986, by Illinois Central Gulf ("Illinois Central") and Helm Financial Corporation ("Helm") (the "Illinois Central-Helm" agreement), under which Helm agreed to supply Illinois Central with locomotives whose major maintenance Helm would select a subcontractor to perform. The locomotives would continue to be owned by Helms and others (but not Illinois Central). Illinois Central is a party to a 1964 national collective bargaining agreement (the "1964 Agreement") that provides in Article I, Section 2 in pertinent part, that protective benefits will be paid to employees adversely affected by certain specified kinds of transactions, the applicable one of which is "the lease or purchase of equipment ... [the] servicing or repairing of which is to be performed by the lessor or the seller."

In the second third-party contract at issue Burlington Northern ("Burlington Northern") on October 28, 1986, entered into an "Electrical Power Purchase Agreement" with Oakway, Inc. (the "Burlington Northern-Oakway" agreement), pursuant to which Oakway would provide to Burlington Northern certain levels of megawatt hours of electricity by means of locomotives supplied and maintained by Oakway. Burlington Northern is a party to a "local" collective bargaining agreement that modifies certain terms of the national 1964 Agreement. The local agreement, which is entitled the CB & Q Agreement No. 76-69, provides in pertinent part that: "Repair work covered by the classification of work rules on locomotives, acquired through purchase or lease, will not be subcontracted outside the warranty period...."

Union negotiators arranged a meeting with the railroads to assert their position that maintenance and repair work on locomotives provided to the railroads under such agreements should be performed by their own members. The railroads offered to submit the disputes to arbitration but refused to negotiate. The railroads some short time later filed an action for a preliminary injunction against any strikes over the third-party contracts in the United States District Court for the Northern District of Illinois. The district court determined that both disputes were "minor" disputes within the exclusive jurisdiction of the appropriate special railway adjustment boards. ¹ The court then enjoined the unions against striking under its power to issue an injunction to preserve the jurisdiction of the adjustment boards. The trial court conditioned this injunction on the railroad's maintenance of the status quo pending the adjustment boards' decisions.

While the two third-party disputes are the centerpiece of this litigation, they appeared during voting by several of the nation's railroad unions on the question of whether to approve a tentative collective bargaining agreement negotiated under section 6 of the Railway Labor Act between the unions and most of the nation's Class I railroads, who are represented in national negotiations by the National Railway Labor Conference, a plaintiff-appellee here. ² Two of the unions, the International Brotherhood of Electrical Workers ("Electrical Workers") and the International Association of Machinists and Aerospace Workers ("Machinists"), suspended the voting process when the negotiations over the third-party disputes broke down. Both unions then withdrew their recommendation supporting ratification of the agreement, communicated to their members their disfavor over the railroads' third-party contracts, and directed that a new vote be taken, recommending that their members vote in favor of a strike. The two unions voted to reject the tentative bargaining agreement in this second vote. A third union, the International Association of Boilermakers, Iron Ship Builders, Blacksmiths, Forgers, and Helpers (the "Boilermakers") purported to reject the tentative national agreement by means of a declaration of the Boilermakers's President rejecting the agreement. These three unions are the defendants in the present action. ³

Subsequent to the issuance of the injunction the unions moved the trial court to declare them free to strike over the rejected national agreements. The unions argued that the second vote had validly rejected the tentative agreement and brought the lengthy section 6 procedures to a close, thus allowing the unions to resort to self-help. The trial court denied the motion, however, reasoning that the third-party disputes had affected the ratification vote, and had become inextricably intertwined with the national negotiations.

On appeal the unions challenge the trial court's determination that the disputes are minor and the injunction preventing them from striking. The railroads challenge the scope of the status quo injunction issued against them. We have jurisdiction of the appeal under 28 U.S.C. Sec. 1292(a)(1) to review the district court's granting of and refusal to modify the preliminary injunction.

II

A. "Major" and "Minor" Disputes under the Railway Labor Act

The Railway Labor Act, as construed by the Supreme Court, establishes two different and distinct structures for resolving labor disputes on the nation's railways. See 45 U.S.C. Secs. 151-160; Elgin, Joliet & Eastern Railway v. Burley, 325 U.S. 711, 722-27, 65 S.Ct. 1282, 1289-91, 89 L.Ed. 1886 (1945), reaffirmed on reargument, 327 U.S. 661, 66 S.Ct. 721, 90 L.Ed. 928 (1946); see also Local 533 Transport Workers Union of America v. Eastern Air Lines, Inc., 695 F.2d 668, 673 (2d Cir.1983) (as amended). The characterization of a dispute as "major" or "minor" channels the dispute into the appropriate structure. If the dispute is major it is subject to section 6 of the Railway Labor Act, 45 U.S.C. Sec. 156, and the parties are required to follow a long, drawn-out conciliation process, which includes negotiation between the parties, mediation by the National Mediation Board, and possibly a review and report by an emergency board appointed by the President. See generally 45 U.S.C. Secs. 151-160; see also Brotherhood of Railroad Trainmen v. Jacksonville Terminal Co., 394 U.S. 369, 378, 89 S.Ct. 1109, 1115, 22 L.Ed.2d 344 (1969) (detailing the major disputes process). If at the end of this process the dispute is not resolved the parties may resort to self-help. E.g., Brotherhood of Locomotive Engineers v. Atchison, Topeka, & Santa Fe Railway Co., 768 F.2d 914, 920 (7th Cir.1985); Atchison, Topeka, & Santa Fe Railway Co. v. United Transportation Union, 734 F.2d 317, 320 (7th Cir.1984). This procedure commands extensive and exhaustive bargaining but does not force a result; it is essentially conciliatory.

If, on the other hand, the court deems the dispute "minor" it is subject to section 3 of the Railway Labor Act, 45 U.S.C. Sec. 153, and the parties (failing resolution in the normal grievance process) must submit their differences to the binding authority of an adjustment board, which exercises exclusive jurisdiction over the dispute. E.g., Andrews v. Louisville & Nashville Railway, 406 U.S. 320, 92 S.Ct. 1562, 32 L.Ed.2d 95 (1972); Atchison, Topeka, & Santa Fe Railway Co. v. United Transportation Union, 734 F.2d 317, 320 (7th Cir.1984); Chicago and Northwestern Transportation Co. v. United Transportation Union, 656 F.2d 274, 277 (7th Cir.1981).

Neither major nor minor disputes are explicitly defined in the Railway Labor Act itself. This terminology is drawn from judicial gloss on the statute, originating with the Supreme Court's opinion in Burley. Burley, 325 U.S. at 722-27, 65 S.Ct. at 1289-91. The case law establishes that major disputes are those over the formation or alteration of collective bargaining agreements while minor disputes are those over the interpretation of existing collective bargaining agreements. A major dispute is over the acquisition of a new right or the imposition of a new duty, while a minor dispute seeks to enforce an accrued right by reference to an existing collective bargaining agreement. ⁴ E.g., Burley, 325 U.S. at 723, 65 S.Ct. at 1290; see also, e.g., Atchison, Topeka, & Santa Fe Railway Co., 768 F.2d at 920; Atchison, Topeka, & Santa Fe Railway Co., 734 F.2d at 320; ...