Art Metals Const. Co. v. National Labor Relations Bd.

• Decision Date: 26 February 1940
• Docket Number: No. 163.,163.
• Citation: 110 F.2d 148
• Parties: ART METALS CONST. CO. v. NATIONAL LABOR RELATIONS BOARD.
• Court: U.S. Court of Appeals — Second Circuit

110 F.2d 148 (1940)

ART METALS CONST. CO. v. NATIONAL LABOR RELATIONS BOARD.

No. 163.

Circuit Court of Appeals, Second Circuit.

February 26, 1940.

Slee, O'Brian, Hellings & Ulsh and Dana B. Hellings, all of Buffalo, N. Y., for petitioner.

Charles Fahy, Gen. Counsel, Robert B. Watts, Associate Gen. Counsel, and Laurence A. Knapp, Asst. Gen. Counsel, all of Washington, D. C., and Ernest A. Gross, Richard C. Barrett, and Leonard Appel, all of Washington, D. C., for respondent.

Before L. HAND, CHASE, and CLARK, Circuit Judges.

L. HAND, Circuit Judge.

This cause comes before us upon a petition by an employer to review an order of the National Labor Relations Board, which directed it (1) to bargain collectively with a union of its "production and maintenance employees", (2) not to interfere with the right of self-organization, (3) in case any understanding is reached with them, to put it in writing; and (4) to post the usual notice of compliance. A copy of the order is set forth in the margin¹. The petitioner argues that the evidence did not justify the facts found; and that, even if it did, the order went beyond the Board's powers. It is not disputed that the employer was engaged in interstate commerce in such sense as to be subject to the National Labor Relations Act, 29 U.S.C.A. § 151 et seq.; that the approximate number of its employees in 1937, the year in question, was 897; and that its production and maintenance employees constituted an appropriate unit for collective bargaining. The Board found that 823 of these employees were members of the union on July first, 1937; that 803 of them were such on August first, and that more than 500 continued to be members during all the rest of the year. This finding depended upon the testimony of one Voght, financial secretary of the union, who kept its financial record, which purported to contain the names of all members in good standing; that is to say, those who were not more than three months in arrears for dues. Voght testified that the members paid dues direct to him, that he entered their names in a cash book at the time, and then transferred them into the ledger, which he produced. We cannot see any basis to challenge the competency of this evidence, or its sufficiency to support the finding, even though common-law evidence alone were competent, which is not the case, § 10(b), 29 U.S.C.A. § 160(b). The Board also found that on July 24, 1937, and at all times thereafter, the petitioner refused to bargain collectively with the union, because it refused to enter into a written contract, embodying whatever agreements might be reached. This the petitioner admits, but in excuse urges, first, that it did not know that the union represented a majority of its employees, and second, that the statute did not require it to put agreements into writing.

As to the first, the evidence is clearly against it. The superintendent of its Jamestown plant, where the negotiations took place, admitted at the hearings that at the meeting of July 24, 1937, Schott, a representative of the union, asked whether the company officials recognized the union committee as a bargaining agency, and that he, the superintendent, answered that they assumed that that was true and were dealing with the committee for that reason. Moreover, the written agreement, presented by the union at that time, purported to recognize the union as the sole bargaining agency of its employees. There can therefore be no doubt that the employer understood that it was dealing with those who at least claimed to be acting for a union of its employees, and from this the implication was that the union also claimed to represent a majority. The employer took the risk of refusal, if the claim turned out to be well-founded. National Labor Relations Board v. Remington-Rand, Inc., 2 Cir., 94 F.2d 862, 868. The important question is whether its conceded refusal to put the terms of any oral agreement in writing, was a refusal to bargain collectively within § 8(5) of the act, 29 U.S.C.A. § 158(5).

The argument on this point rests upon the admitted truth that the act does not force the parties to come to any agreement at all; for, although an employer must honestly negotiate with his employees collectively, that is as far as he need go. But if, the argument runs, he is forced to make it a term of any oral agreement that it shall be put into writing, he loses that absolute freedom in negotiation which he had at common law, and which Congress meant to preserve to him. Inland Steel Company v. National Labor Relations Board, 7 Cir., 109 F.2d 9. It is indeed true, and for that matter a truism, that a stipulation in an oral contract that it shall be put into writing is one of its terms, and that if an employer must put it in, he is not free pro tanto. But he is no longer wholly free anyway; before the act he was not obliged to bargain with his employees collectively; he was at liberty to refuse to negotiate with them at all, or otherwise than severally. The act impaired that freedom; it meant to give to the employees whatever advantage they would get from collective pressure upon their employer; and the question here is what are the fair implications of that grant. They should include whatever is reasonably appropriate to protect it, and no one can dispute that a permanent memorial of any negotiation which results in a bargain, is not only appropriate, but practically necessary, to its preservation; it is hardly necessary to observe that without it the fruits of the privilege are exposed to the sport of fugitive and biased recollection. The purpose of a contract is to define the promised performance, so that when it becomes due, the parties may know the extent to which the promisor is bound; and it is the merest casuistry to argue that the promisor's freedom to contract includes the opportunity to put in jeopardy the ascertainment of what he has agreed to do, or indeed whether he has agreed to anything at all. The freedom reserved to the employer is freedom to refuse concessions in working conditions to his employees, and to exact concessions from them; it is not the freedom, once they have in fact agreed upon those conditions, to compromise the value of the whole proceeding, and probably make it nugatory.

Article I (b) of the order rests upon the premise that an unfair labor practice under § 8(5) is also an unfair practice under § 8 (1), and that is contrary to our ruling in National Labor Relations Board v. Remington-Rand, Inc., 2 Cir., 94 F.2d 862, 869, which the Board has since then consistently refused to follow. Globe Cotton Mills v. National Labor Relations Board 5 Cir., 103 F.2d 91, accords with us, but National Labor Relations Board v. Biles-Coleman L. Co., 9 Cir., 98 F.2d 18, 22, 23 is contrary. Except for the new light now thrown upon the matter, we should still be unconvinced; but we learn that both the Committee of the House and the Committee of the Senate in reporting the bill declared that §§ 8(2), 8(3), 8(4) and 8(5), were species of the generic unfair labor practice defined in § 8(1). Certainly the language does not so plainly forbid that construction that we must disregard it; on the contrary we consider it authoritative. For that reason we overrule our holding — it was in no sense a dictum — in National Labor Relations Board v. Remington-Rand, Inc., supra, 94 F.2d 862, 869. The petition does not challenge the generality of the language used in Article I (b) of the order ("In any other manner", etc.,) and for that reason we do not consider whether it should have been limited to the single unfair practice found. Article I(b) is affirmed.

The petitioner also objects to Article II (b) insofar as it compels it to post notices in its plant that it will "cease and desist" from doing what the earlier parts of the order forbid. It argues that by this the Board seeks to extort from it a confession that it has been guilty of unfair labor practices in the past, and it denies any guilt. Assuming that it is permissible to require it to declare publicly that it will conform in the future to what the Board directs, it insists that this goes further, because the words "cease and desist" inevitably imply that it has been doing that which it is now ordered to stop. The circuit courts of appeals have divided upon this question. It is the settled rule in the Fourth Circuit that such a declaration cannot be compelled. National Labor Relations Board v. A. S. Abell Co., 4 Cir., 97 F.2d 951, 958, 959; National Labor Relations Board v. Eagle Mfg. Co., 4 Cir., 99 F.2d 930, 932; Virginia Ferry Corp. v. National Labor Relations Board, 4 Cir., 101 F. 2d 103, 106; National Labor Relations Board v. Nebel Knitting Co., 4 Cir., 103 F. 2d 594. (We cannot believe that National Labor Relations Board v. Asheville Hosiery Co., 4 Cir., 108 F.2d 288, 293, was intended sub silentio to overrule four deliberate rulings all made within eighteen months.) The Sixth accords with the Fourth. National Labor Relations Board v. Louisville Refining Co., 6 Cir., 102 F.2d 678, 681. So does the Tenth. Swift & Co. v. National Labor Relations Board, 10 Cir., 106 F.2d 87, 94. On the other hand the Fifth dissents. National Labor Relations Board v. Brown Paper Mill Co. Inc., 5 Cir., 108 F.2d 867. In National Labor Relations Board v. Falk Corporation, 7 Cir., 102 F.2d 383, 390, the Seventh Circuit also refused to follow the Fourth, and at first affirmed the Board's order. Later it changed its mind, sua sponte, upon another question in the case — the status of a company union — and modified its ruling, necessarily changing the provisions for posting, though not the words, "cease and desist". 7 Cir., 106 F.2d 454. The Board applied for certiorari, it was allowed, and the Supreme Court reinstated the original order. National Labor Relations Board v. Falk Corp., 308 U.S. 453, 60 S.Ct. 307, 84 L.Ed. ___. From the way in which the case came up it would seem that the court...