Newport News S. & Dry Dock Co. v. NATIONAL LABOR R. BD.

Decision Date28 February 1939
Docket NumberNo. 4390.,4390.
Citation101 F.2d 841
PartiesNEWPORT NEWS SHIPBUILDING & DRY DOCK CO. et al. v. NATIONAL LABOR RELATIONS BOARD.
CourtU.S. Court of Appeals — Fourth Circuit

Before PARKER, NORTHCOTT, and SOPER, Circuit Judges.

Fred H. Skinner, of Newport News, Va. (John Marshall, of Newport News, Va., on the brief), for petitioner Newport News Shipbuilding & Dry Dock Co.

Frank A. Kearney, of Phoebus, Va., for petitioner Employees' Representative Committee of Newport News Shipbuilding & Dry Dock Co.

A. Norman Somers, Atty., National Labor Relations Board, of Washington, D. C. (Charles Fahy, Gen. Counsel, Robert B. Watts, Associate Gen. Counsel, and Laurence A. Knapp and Mortimer B. Wolf, all of Washington, D. C., Attys., National Labor Relations Board, on the brief), for respondent.

SOPER, Circuit Judge.

This case comes before the court on petition of the Newport News Shipbuilding and Dry Dock Company to review and set aside an order of the National Labor Relations Board issued against it, and upon the answer of the Board which prays that the petition be dismissed and the order enforced. The controversy grows out of a charge filed with the Board on June 12, 1937, by the Industrial Union of Marine & Shipbuilding Workers of America, that in March, May and June, 1937, the Shipbuilding Company had discharged and refused to reinstate seven named employees because they had joined a labor organization and had engaged in concerted activities for collective bargaining; and that the Shipbuilding Company had dominated and interfered with the employees' right of self organization by dominating, interfering with, and lending financial support to a labor organization in its plant known as Representation of Employees. Upon this charge the Board formulated the complaint that these acts of the Shipbuilding Company constituted unfair labor practices within the meaning of section 8 (1), (2) and (3) of the National Labor Relations Act, 29 U.S.C.A. §§ 151 et seq., 158(1-3).

Pursuant to section 10(b) of the Act, 29 U.S.C.A. § 160(b), the labor organization known as Representation of Employees, or Employees' Representative Committee, was allowed to intervene and answer the complaint.

Evidence was taken before a trial examiner who filed a report sustaining the charges as to the discharge of certain of the seven employees, and as to the domination and interference with the employees' organization. When the case subsequently came before the Board, it held that the evidence did not support the charge that the company had unlawfully discharged the named employees, but it found that the company had dominated and interfered with the formation and administration of the Employees' Representative Committee, and had contributed to its support, and therefore, had engaged in unfair labor practices within the meaning of section 8 (1) and (2) of the Act. The Board ordered the employer to cease and desist from such practices, and to withdraw all recognition from the Employees' Representative Committee, as the representative of its employees with respect to grievances or labor disputes, and also to completely disestablish the Committee as such representative.

The first question which arises on the petition is as to the jurisdiction of the Board, i. e., whether the operations of the Shipbuilding Company are so connected with interstate and foreign commerce that the unfair labor practices alleged come within the Board's jurisdiction as affecting such commerce. On this question we think that the decision of the Board upholding its jurisdiction was clearly correct. A considerable portion of the business consisted of repairing and overhauling instrumentalities of interstate and foreign commerce. Between July 1935 and August 1937 it serviced 322 vessels for private interests at a billing price of more than $3,000,000; and between June 1934 and the date of the hearing it had under construction for private interests two tug boats and a tank barge, at contract prices aggregating $1,020,000. Therefore, even if its construction of naval vessels were ignored, its operations must be held to affect interstate commerce substantially; and, as separation of the two types of work is impracticable, the power of Congress with respect to the regulation of the entire business must be upheld. Consolidated Edison Co. v. National Labor Board, 59 S.Ct. 206, 83 L.Ed. ___; National Labor Relations Board v. Jones & Laughlin Steel Co., 301 U.S. 1, 57 S.Ct. 615, 81 L. Ed. 893, 108 A.L.R. 1352; The Shreveport Case, Houston, E. & W. T. R. Co. v. U. S., 234 U.S. 342, 34 S.Ct. 833, 58 L.Ed. 1341; Wallace v. Currin, 4 Cir., 95 F. 2d 856; Virginian Ry. Co. v. System Federation No. 40, 4 Cir., 84 F.2d 641, affirmed 300 U.S. 515, 536, 57 S.Ct. 592, 81 L.Ed. 789.

But we do not think that the construction of naval vessels in which the company is chiefly engaged, can be ignored. It may be noted in passing that while these vessels are not designed to serve as carriers of commodities for sale or barter, they are intended to navigate the public waters of the United States and to transport persons and property from state to state and to foreign countries (cf. Gilman v. Philadelphia, 3 Wall. 713, 724, 18 L.Ed. 96; Gloucester Ferry Co. v. Pennsylvania, 114 U.S. 196, 203, 5 S.Ct. 826, 29 L.Ed. 158; Caminetti v. United States, 242 U.S. 470, 492, 37 S.Ct. 192, 61 L.Ed. 442, L. R.A.1917F, 502, Ann.Cas.1917B, 1168); but the regulatory power of Congress may be safely rested upon the fact that by far the greater part of the materials used in the construction of the vessels is received in interstate commerce, which would be affected, if the work of construction should be obstructed by industrial strife. The company employed 6697 persons at the time of the hearing. During the year 1936 91.4% of the business consisted in building men-of-war for the United States Navy, 5.8% in repair work, and 2.8% in the construction of hydraulic turbines and miscellaneous work. During this year the total purchases of materials was $7,479,418 of which only $815,423.54, or 10.9%, were made within the state, the remainder representing interstate shipments. From January to August 1937, the purchases were $5,594,240, of which only $494,351.33, or 8.8%, were made within the state. If, therefore, the purpose of construction be ignored and it be assumed that the construction is of articles which are to have no relation to interstate or foreign commerce, a sufficient ground for regulation appears in the effect of the purchases on interstate commerce, which is within the power and duty of Congress to regulate and protect. If practices in the business will affect such commerce, Congress, under the clearest principles, has the power to regulate them. We have so held with respect to manufacturing products grown within a state for transportation in interstate commerce. Mooresville Cotton Mills v. National Labor Relations Board, 4 Cir., 94 F.2d 61. The Supreme Court so held with respect to the canning, packing and shipping of agricultural products grown within a state but shipped in interstate commerce, Santa Cruz Fruit Packing Co. v. National Labor Relations Board, 303 U.S. 453, 58 S.Ct. 656, 82 L.Ed. 954. There can be no difference in principle between the case in which manufacture precedes and that in which it follows interstate commerce. If the flow of commerce is obstructed by labor disputes, it can make no difference from which direction the obstruction is applied.

The second question in the case is whether the evidence justifies the order of the Board requiring the disestablishment of the Employees' Representative Committee. The findings of fact upon which the Board found that the Shipbuilding Company had been guilty of dominating and interfering with the Committee were as follows:

"In 1927, in cooperation with its employees, the respondent put into effect at the shipyard a plan of employee representation known as Representation of Employees. The purposes of the plan were stated in its preamble as follows:

"In order to give the employees of the Company a voice in regard to the conditions under which they labor, and to provide an orderly and expeditious procedure for the prevention and adjustment of any future differences, and to anticipate the problem of continuous employment, a method of representation of employees is to be established.

"Provision was made for the election, annually, by the employees of 21 white and 7 colored representatives. The elected representatives each were paid $100 per year by the respondent for serving in that capacity. Persons holding supervisory positions were ineligible to serve as representatives or to vote for representatives.

"The administration of the plan was vested in four* joint committees, consisting respectively of five of the elected representatives and not more than an equal number of representatives chosen from among the employees by the management. The plan provided, in addition, for a so-called Management's Representative whose function it was `to keep the management in touch with the representatives and represent the management in negotiations with their officers and committees.' A provision calling for the arbitration of differences became operative only upon concurrence of the respondent's president. Amendment of the plan required the affirmative vote of two-thirds of the full membership of one of the joint committees, namely, the Committee on Rules (which included representatives appointed by the management), or of a majority of all the employees' representatives and representatives of management at an annual conference. The independence of action of elected representatives was `guaranteed' by permitting them to take questions of discrimination `to any of the Superior Officers, to the Joint Committee and to the President of the Company.' The plan contained no provision for the payment of dues.

"The original plan was revised in 1929, 1931, 1934, 1936, and...

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