Montgomery Ward & Co. v. NLRB

• Decision Date: 08 January 1965
• Docket Number: No. 15738.,15738.
• Citation: 339 F.2d 889
• Parties: MONTGOMERY WARD & CO., Incorporated, Petitioner, v. NATIONAL LABOR RELATIONS BOARD, Respondent.
• Court: U.S. Court of Appeals — Sixth Circuit

339 F.2d 889 (1965)

MONTGOMERY WARD & CO., Incorporated, Petitioner, v. NATIONAL LABOR RELATIONS BOARD, Respondent.

No. 15738.

United States Court of Appeals Sixth Circuit.

January 8, 1965.

Narcisse A. Brown, Chicago, Ill., William B. Hanley, Chicago, Ill., Robert F. Groneman, Davis, Farley, Short & Roberts, Cincinnati, Ohio, on brief, for petitioner.

Duane R. Batista, N. L. R. B., Washington, D. C., Arnold Ordman, General Counsel, Dominick L. Manoli, Associate General Counsel, Marcel Mallet-Prevost, Asst. General Counsel, Stephen B. Goldberg, Atty., N. L. R. B., Washington, D. C., on brief, for respondent.

Before CECIL, PHILLIPS and EDWARDS, Circuit Judges.

EDWARDS, Circuit Judge.

Petitioner, Montgomery Ward & Co., seeks review of an order of the NLRB finding certain unfair labor practices and ordering petitioner to desist therefrom. The Board in turn seeks enforcement of its order by cross-petition.

Although the site of this dispute is a department store operated by petitioner in Big Springs, Texas, jurisdiction is established in this court by Section 10(e) and (f) of the National Labor Relations Act (29 U.S.C. §§ 151-160) since the petitioner "transacts business" in the states comprising the Sixth Circuit.

The background of this case is an attempt made by a union¹ to organize the Montgomery Ward employees in its Big Springs, Texas, store. When a number of the fifty employees in this store joined the union, Montgomery Ward reacted with considerable vigor.

Its supervisors called three meetings of all the employees (on paid time before or after work) in order to have them hear company speeches against the union. Supervisory personnel interrogated various employees about claimed violations of company rules prohibiting solicitation of employees for union membership during working time or on company property. The assistant manager twice drove around union meetings at the union hall checking parked cars to gain information on attendance.

As indicated above, the store had a broad "no-solicitation rule" which prevented solicitation of union membership on "company time" or in selling areas of the store or in areas of the store where it would interfere with the operation of the store.

At one of the meetings the store manager made an anti-union speech and then read the company "no-solicitation" rule to the grouped employees. Then he added that the rule also meant "no solicitation" during lunch time or during "coffee breaks" at the cafe across from the store. He added that employees violating the rule would be fired.

After this meeting the union business agent asked permission to address the employees on company time to respond to the statements made by the store manager. This request was denied.

After these events (and the discharge of the most vocal union adherent² among the employees), on April 23 a representation election was held. The union lost by a two to one margin. Thereafter unfair labor practice charges were filed which resulted in the instant proceeding.

After a full hearing, the Trial Examiner found:

"By promulgating an unlawful no-solicitation rule and by engaging in surveillance of union activity Respondent interfered with, restrained and coerced its employees in the exercise of the rights guaranteed by Section 7, thereby violating Section 8 (a) (1)."

He recommended a cease and desist order and the posting of notices to advise the employees of the intention of petitioner not to repeat these violations.

The General Counsel filed 51 exceptions to the Trial Examiner's report. The Board, however, gave serious weight to only one of these; namely, his contention that petitioner violated Section 8(a) (1) by refusing, under the circumstances related above, to allow the union an opportunity to address the employees on company premises.

After adopting the Trial Examiner's findings and recommended order as to all other issues, the Board detailed its views on the basic issue now before this court:³

"The Respondent\'s utilization of company time and premises to propagandize against the Union must be viewed against the background of its unlawful circumscription of its employees\' union activity. Respondent\'s representatives made antiunion speeches to assembled employees on company time and premises on January 16, January 24 and May 9. The Union, on January 23, requested permission to address Respondent\'s employees during working hours, but was refused. (Footnote omitted.)

* * * * * *

"The facts in the instant case are much stronger for finding a violation than in the May case The May Department Stores Company v. N.L. R.B., 316 F.2d 797 (C.A. 6, 1963). For here Respondent did more than merely promulgate a broad, privileged, and hence lawful, no-solicitation rule. It went further and announced a rule which not only prohibited union discussion in selling areas of the store, but which also unlawfully forbade such activities in nonselling areas within the store regardless of whether the employees were on free time or not, and even went so far as to proscribe legitimate union activities off the store\'s premises during the store\'s business hours. In short, Respondent seriously impaired lawful solicitation activities at the natural site where employees are accessible for organizational efforts. Quite clearly, here more than in May, Respondent\'s broad and unlawful no-solicitation rule, coupled with its own use of Company time and property to impress its antiunion propaganda on employees, `created a glaring imbalance in organizational communication\' that justified the Union\'s request to address employees under the same circumstances as had Respondent. (Emphasis in original.)

"For the foregoing reasons, we find that Respondent, by denying the Union\'s request, violated Section 8 (a) (1) of the Act. It follows, and we also find, that such conduct of Respondent also interfered with the election of May 10, and we shall therefore set that election aside and direct a new election.

"The Remedy

"Our finding of a violation of Section 8(a) (1) from Respondent\'s refusal to allow the Union to address the employees has been predicated on the Respondent\'s maintenance of an unlawful no-solicitation rule. However, in view of the nature of Respondent\'s business and the fact that Respondent may adopt a broad, yet privileged, rule, we shall direct Respondent, while enforcing either such a privileged rule or an unlawful one, not to make antiunion speeches to employees during company time on its premises without honoring a union\'s request similarly to address the employees." 145 N.L.R.B. No. 88, at 4-6 (1964).

In the issue thus described, the property rights and the constitutional and statutory free speech rights of employers come into conflict with the national purpose of making secure employees' rights to organize. Accommodating both sets of rights has puzzled Congress. Its current formulations as set forth in the N.L.R.A. are as follows:

"RIGHTS OF EMPLOYEES

"Sec. 7. Employees shall have the right to self-organization, to form, join, or assist labor organizations, to bargain 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, and shall also have the right to refrain from any or all of such activities except to the extent that such right may be affected by an agreement requiring membership in a labor organization as a condition of employment as authorized in section 8(a) (3).

"UNFAIR LABOR PRACTICES

"Sec. 8(a) It shall be an unfair labor practice for an employer —

"(1) to interfere with, restrain, or coerce employees in the exercise of the rights guaranteed in section 7;

* * *

"(c) The expressing of any views, argument, or opinion, or the dissemination thereof, whether in written, printed, graphic, or visual form, shall not constitute or be evidence of an unfair labor practice under any of the provisions of this Act, if such expression contains no threat of reprisal or force or promise of benefit."

Thus Congress has recognized employer rights of free speech, but has sought to limit them when they verge upon the use of employer economic power to coerce employees not to organize.

The Supreme Court has not found the resolution of these conflicting interests simple — either before or after the adoption of Section 8(a) (1), (c). N.L.R.B. v. United Steelworkers of America, 357 U.S. 357, 78 S.Ct. 1268, 2 L.Ed.2d 1383 (1958); N.L.R.B. v. Babcock & Wilcox Co., 351 U.S. 105, 76 S.Ct. 679, 100 L.Ed. 975 (1956); Republic Aviation Corp. v. N.L.R.B., 324 U.S. 793, 65 S.Ct. 982, 89 L.Ed. 1372 (1945); Thomas v. Collins, 323 U.S. 516, 65 S.Ct. 315, 89 L.Ed. 430 (1945).

Each of these cases bears upon our present problem, but does not solve it.

In Thomas v. Collins, supra, the earliest of these cases, we find these paragraphs:

"Accordingly, decision here has recognized that employers\' attempts to persuade to action with respect to joining or not joining unions are within the First Amendment\'s guaranty. National Labor Relations Board v. Virginia Electric & Power Co., 314 U.S. 469, 62 S.Ct. 344, 86 L.Ed. 348. Decisions of other courts have done likewise. When to this persuasion other thing are added which bring about coercion, or give it that character, the limit of the right has been passed. Cf. National Labor Relations Board of Virginia Electric & Power Co., supra. But short of that limit the employer\'s freedom cannot be impaired." (Footnotes omitted.) Thomas v. Collins, supra 323 U.S. at 537-538, 65 S.Ct. at 326 (Opinion of Rutledge, J.)

A concurring opinion stated:

"No one may be required to obtain a license in order to speak. But once he uses the economic power which he has over other men and their jobs to influence their action, he is doing more than exercising the freedom of speech protected by the First Amendment. That is true whether he be an employer or an employee. But as long as he does

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