Continental Insurance Company v. NLRB

• Citation: 409 F.2d 727
• Decision Date: 15 April 1969
• Docket Number: No. 237,238,Dockets 32550,32673.,237
• Parties: CONTINENTAL INSURANCE COMPANY, Petitioner, v. NATIONAL LABOR RELATIONS BOARD, Respondent.
• Court: United States Courts of Appeals. United States Court of Appeals (2nd Circuit)

409 F.2d 727 (1969)

CONTINENTAL INSURANCE COMPANY, Petitioner, v. NATIONAL LABOR RELATIONS BOARD, Respondent.

Nos. 237, 238, Dockets 32550, 32673.

United States Court of Appeals Second Circuit.

Argued February 6, 1969.

Decided April 15, 1969.

Frederick T. Shea, New York City (Kelley, Drye, Newhall, Maginnes & Warren, and Irving Brand, New York City, on the brief), for petitioner.

Paul J. Spielberg, National Labor Relations Board (Arnold Ordman, General Counsel, Dominick L. Manoli, Associate Gen. Counsel, Marcel Mallet-Prevost, Assistant Gen. Counsel, and Hans J. Lehmann, N.L.R.B., on the brief), for respondent.

Before ANDERSON and FEINBERG, Circuit Judges, and MANSFIELD, District Judge.^*

ANDERSON, Circuit Judge:

Continental Insurance Company is a New York corporation engaged in the sale and service of casualty, property and life insurance throughout the United States and Canada. The Company conducts its operations regionally through nine Departments, each serving a different geographic area.¹ Each Department underwrites insurance risks and issues insurance policies; it also evaluates, processes and settles claims through Branch Claims Offices located throughout the Department's territory.

On May 4, 1967, the American Communications Association, Communications Trade Division, International Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of America filed with the National Labor Relations Board a petition seeking to represent all claims adjusters, examiners and investigators in the Company's New York City Branch Claims Office, which is one of three claims offices serving the Metropolitan New York City Department.² Shortly thereafter the Union petitioned for representation of the same groups of employees in the Newark and Perth Amboy, New Jersey, Branch Claims Offices, which are two of nine such offices serving the Middle Department.³ After a hearing on the consolidated petitions, the Board, on February 1, 1968, ruled that a unit of claims adjusters, examiners and investigators at each of the three Branch Claims Offices was appropriate for purposes of collective bargaining and issued a direction of election. A short time later, the Union lost the election at Perth Amboy but won at both the New York City and Newark offices.

Upon receiving official certification on March 6, 1968, the Union requested recognition and bargaining, but the Company refused to bargain on grounds that the designated units were inappropriate, being limited to single Branch Claims Offices and improperly including claims adjusters. The Board rejected these arguments, held that the Company's interference with employees in the exercise of their rights and refusal to bargain were violations of § 8(a) (1) and (5) of the National Labor Relations Act, and ordered the Company to cease and desist from its unlawful conduct and to bargain with the Union upon request.

The principal issue in this petition for review and cross-petition for enforcement is the validity of the Board's decision that the single Branch Claims Offices were appropriate units for collective bargaining. Section 9(b) of the Act places in the hands of the Board the responsibility for making such unit determinations, which, in view of the large measure of informed discretion involved, are to be disturbed only if arbitrary and unreasonable. Packard Motor Car Co. v. National Labor Relations Board, 330 U.S. 485, 67 S.Ct. 789, 91 L. Ed. 1040 (1947); NLRB v. St. John's Associates, Inc., 392 F.2d 182 (2 Cir. 1968); NLRB v. Sunrise Lumber & Trim Corp., 241 F.2d 620, 624 (2 Cir.), cert. denied, 355 U.S. 818, 78 S.Ct. 22, 2 L.Ed.2d 34 (1957)

As noted in NLRB v. Solis Theatres, 403 F.2d 381 (2 Cir. 1968), we are not unmindful of the difficulties involved in making unit determinations that, on the one hand, effect the policy of the Act to assure employees the fullest freedom in exercising their rights and, on the other hand, respect the interest of an integrated multi-unit employer in maintaining enterprise-wide labor relations. Each case necessarily requires a balancing of the interests of employer and employees. In this case, we are satisfied that there is substantial evidence in the record to support the Board's determination of that issue.

Each of Continental's nine Departments is headed by a Departmental Manager who bears overall responsibility for Company business within the Department. He is assisted by second-level managers in charge of each of the several functions of the Department — e. g. the claims function is overseen by a Departmental Claims Manager. In addition, each Branch Claims Office is under the supervision of a Branch Claims Manager who is responsible to his respective Departmental Claims Manager. The Metropolitan New York City Department is unique among Continental's Departments because its Departmental Claims Office also serves as the New York City Branch Claims Office.

Continental's operations are in many respects highly centralized in the Company's Home Office or in the Departmental Offices. For example, claims exceeding a specified amount are closely supervised by Departmental personnel. Moreover, final decisions concerning labor relations matters, such as hiring, firing and granting of raises are made at these higher levels in the Company. On the other hand, it is clear from the record that each Branch Claims Office in question is a separate autonomous unit, enjoying complete control over the processing of the vast majority of claims. In addition, the Branch Claims Managers possess considerable influence in the final decisions with respect to the personnel matters described above.

On the basis of Solis Theatres, supra at 383, however, the Company argues that the Branch Claims Office is an inappropriate bargaining unit because, despite their influence, the Branch Claims Managers...