Brotherhood of Locomotive Engineers v. I.C.C.
| Decision Date | 12 July 1985 |
| Docket Number | 83-2317,Nos. 83-2290,s. 83-2290 |
| Citation | 761 F.2d 714,245 U.S.App.D.C. 311 |
| Parties | 119 L.R.R.M. (BNA) 2258, 245 U.S.App.D.C. 311, 102 Lab.Cas. P 11,476 BROTHERHOOD OF LOCOMOTIVE ENGINEERS, Petitioner, v. INTERSTATE COMMERCE COMMISSION and United States of America, Respondents, Missouri-Kansas-Texas Railroad Company, Denver & Rio Grande Western Railroad Company, Union Pacific Railroad Company, et al., Intervenors. UNITED TRANSPORTATION UNION, Petitioner, v. UNITED STATES of America and Interstate Commerce Commission, Respondents, Missouri-Kansas-Texas Railroad Company, Denver & Rio Grande Western Railroad Company, Union Pacific Railroad Company, et al., Intervenors. |
| Court | U.S. Court of Appeals — District of Columbia Circuit |
Petitions for Review of Orders of the Interstate Commerce commission.
Harold A. Ross, Washington, D.C., with whom Gordon P. MacDougall, Washington, D.C., was on the brief, for petitioner in No. 83-2290.
John O'B. Clarke, Jr., Washington, D.C., for petitioner in No. 83-2317.
Sidney L. Strickland, Jr., Atty., I.C.C., Washington, D.C., with whom Robert S. Burk, Acting Gen. Counsel, and Henri F. Rush, Associate Gen. Counsel, I.C.C., J. Paul McGrath, Asst. Atty. Gen., and John J. Powers, III and Frederic Freilicher, Attys., Dept. of Justice, Washington, D.C., were on the brief, for respondents.
John H. Caldwell and Denise M. O'Brien, Washington, D.C., and Kendall T. Sanford, Denver, Colo., were on the brief for intervenor Denver & Rio Grande Western R. Co.
James M. Verner, Ronald B. Natalie and Joseph L. Manson, III, Washington, D.C., and Michael E. Roper, Dallas, Tex., were on the brief for intervenor Missouri-Kansas-Texas R. Co. William C. Evans, Washington, D.C., entered an appearance for that intervenor.
James V. Dolan, Charles A. Miller, and Gregg H. Levy, Washington, D.C. and Nina K. Wuestling, St. Louis Mo., were on the brief for intervenors Union Pacific R. Co. and Missouri Pacific R. Co.
Before WRIGHT and MIKVA, Circuit Judges, and MacKINNON, Senior Circuit Judge.
Opinion for the court filed by Circuit Judge WRIGHT.
Two unions--the Brotherhood of Locomotive Engineers (BLE) and the United Transportation Union (UTU)--object to the Interstate Commerce Commission's interpretation of labor issues arising from ICC's approval of a railroad consolidation.
The unions claim that, when the dust settled from the consolidation, certain railroads had effectively squeezed them out of their previous role in determining the crews used on particular routes. At the time, in early 1983, the unions objected and argued that the railroads' actions violated statutory labor protections. Since the railroads responded that ICC had given them full crew selection rights in the consolidation approval, the unions appealed to ICC for an order clarifying that its general consolidation approval did not affect previous labor arrangements, including crew selection rights.
In two decisions ICC rejected the unions' arguments. It maintained that the railroads' intentions on crew selection had been clear in the consolidation as approved and that ICC's authority to exempt transactions from legal obstacles, 49 U.S.C. Sec. 11341(a) (1982), immunized these crew selection prerogatives from later attack.
The unions now petition this court to vacate those ICC decisions. Four railroads--the Denver & Rio Grande Western (D & RGW), the Missouri-Kansas-Texas (MKT), the Missouri Pacific (MP), and the Union Pacific (UP)--are intervening in support of the Commission.
Because we find that ICC made no semblance of a showing that the exemption was necessary, as required by the exemption authority section, we vacate the ICC decisions and remand the case to the Commission for proceedings consistent with this opinion.
This case presents the intersection of two statutory mandates--ICC's exclusive authority to approve rail consolidations under the Interstate Commerce Act and the statutory protection for rail labor employees under both the Railway Labor Act and the Interstate Commerce Act. The unions argue that (1) ICC did not show a necessity for waiving the Railway Labor Act in the exercise of its Interstate Commerce Act approval authority, and (2) ICC cannot waive the Interstate Commerce Act's labor protection conditions in the exercise of that approval authority. Ultimately, we find the Railway Labor Act argument dispositive, and we vacate the ICC decisions on that basis. To fully understand the texture of this dispute, however, it is necessary to examine the Interstate Commerce Act labor protection conditions as well.
1. ICC's approval authority. Under the Interstate Commerce Act, ICC has exclusive authority to approve certain consolidations and mergers. 49 U.S.C. Sec. 11341 et seq. (1982). The Act enumerates the types of transactions to which ICC's approval authority applies, id. Sec. 11343, and the considerations that must guide ICC, id. Sec. 11344. Most significantly for this appeal, "[a] carrier, corporation, or person participating in that approved or exempted transaction is exempt from the antitrust laws and from all other law, including State and municipal law, as necessary to let that person carry out the transaction, hold, maintain, and operate property, and exercise control or franchises acquired through the transaction." Id. Sec. 11341(a). Thus ICC has the power to approve a transaction and exempt its participants from legal obstacles that would impede its fruition.
In the exercise of this authority to exempt consolidations from the constraints of applicable statutes, ICC has certain ultimate constraints on its broad authority. First, there is a necessity component to the plenary authority: the statute specifies that ICC may exempt transactions from applicable laws "as necessary" for completion of the transaction. Second, as with any agency action, ICC's exercise of its authority must comport with the requirements of reasoned decisionmaking. See generally United States v. ICC, 396 U.S. 491, 90 S.Ct. 708, 24 L.Ed.2d 700 (1970).
2. Labor protection requirements. Statutory protections for railroad employees have received considerable congressional attention. Two important statutory vehicles for the current labor protection requirements are the Railway Labor Act, 45 U.S.C. Sec. 151 et seq. (1982), and the Interstate Commerce Act's labor protection section, 49 U.S.C. Sec. 11347.
The Railway Labor Act creates a highly structured system for administering and resolving labor disputes. In passing the Railway Labor Act Congress sought, in part, "[t]o avoid any interruption to commerce * * *, to forbid any limitation upon freedom of association among employees * * *, [and] to provide for the prompt and orderly settlement of all disputes concerning rates of pay, rules, or working conditions[.]" 45 U.S.C. Sec. 151a. The statute specifies eleven general duties of rail carriers, id. Sec. 152. It also creates a variety of mechanisms to settle rail labor disputes--a National Railroad Adjustment Board, id. Sec. 153, a National Mediation Board, id. Secs. 154-155, and a system of arbitration, id. Secs. 157-159. The statute gives special attention to changes in rates of pay, rules, and working conditions. It provides that employers give employees the opportunity for negotiation and mediation before implementing such changes. Id. Sec. 156; see also id. Sec. 152, Seventh duty. The Railway Labor Act thus stands as an important structure for maintaining labor peace and fairness.
The Interstate Commerce Act labor protection section, 49 U.S.C. Sec. 11347, affords employees substantial protection from the effects of mergers and consolidations. Such labor protection conditions have a long history. See New York Dock Railway v. ICC, 609 F.2d 83, 86-90 (2d Cir.1979). In its current version the section provides that, in the exercise of its approval authority, "the Interstate Commerce Commission shall require the carrier to provide a fair arrangement at least as protective of the interests of employees who are affected by the transaction as the terms imposed under this section before February 5, 1976 * * *." 49 U.S.C. Sec. 11347 (emphasis added).
ICC has specified the particular conditions that must be observed for this Section 11347 requirement. The conditions for protecting labor in a merger are known as New York Dock conditions, see New York Dock Railway, 360 ICC 60 (1979), aff'd sub nom. New York Dock Railway v. ICC, supra. The conditions for protecting labor in transfers of trackage rights are known as Norfolk & Western conditions, see Norfolk & Western Railway Co., 354 ICC 605 (1978), modified by Mendocino Coast Railway, Inc., 360 ICC 653, 664 (1980), aff'd sub nom. Railway Labor Executives' Ass'n v. United States, 675 F.2d 1248 (D.C.Cir.1982). These conditions include negotiation and mediation for dismissal and displacement of employees, 354 ICC at 610-611, 360 ICC at 85; dismissal and displacement compensation, 354 ICC at 611-612, 360 ICC at 86; and a system of arbitration, 354 ICC at 613, 360 ICC at 87-88. Generally, the conditions provide that "[t]he rates of pay, rules, working conditions and all collective bargaining and other rights, privileges and benefits * * * of railroads' employees under applicable laws and/or existing collective bargaining agreements or otherwise shall be preserved unless changed by future collective bargaining agreements or applicable statutes." 354 ICC at 610, 360 ICC at 84. ICC has thus established conditions for discharging its statutory responsibility to protect labor benefits in the midst of consolidations.
In short, ICC has authority to approve certain transactions, even to the extent of exempting the transactions from other laws. At the same time, the Railway Labor Act structures rail labor relations, and the Interstate Commerce Act's...
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