CONTRACTORS, LABORERS, ETC. v. ASSOCIATED WRECKING

• Decision Date: 15 February 1980
• Docket Number: Civ. No. 77-0-248.
• Citation: 484 F. Supp. 582
• Parties: CONTRACTORS, LABORERS, TEAMSTERS AND ENGINEERS HEALTH & WELFARE PLAN; Contractors, Laborers, Teamsters and Engineers Pension Plan; Omaha-Council Bluffs Laborers Local # 1140 Holiday Trust; Laborers Training Fund; and Construction and General Laborers Union, Local No. 1140, Plaintiffs, v. ASSOCIATED WRECKING COMPANY, a Nebraska Corporation, Defendant.
• Court: U.S. District Court — District of Nebraska

484 F. Supp. 582

CONTRACTORS, LABORERS, TEAMSTERS AND ENGINEERS HEALTH & WELFARE PLAN; Contractors, Laborers, Teamsters and Engineers Pension Plan; Omaha-Council Bluffs Laborers Local # 1140 Holiday Trust; Laborers Training Fund; and Construction and General Laborers Union, Local No. 1140, Plaintiffs, v. ASSOCIATED WRECKING COMPANY, a Nebraska Corporation, Defendant.

Civ. No. 77-0-248.

United States District Court, D. Nebraska.

February 15, 1980.

David D. Weinberg, Omaha, Neb., for plaintiffs.

Michael W. Heavey, Omaha, Neb., for defendant.

MEMORANDUM

DENNEY, District Judge.

This matter comes before the Court upon the defendant's motion for summary judgment, and defendant's alternative motion to compel answers to interrogatories Filing # 8. Briefs have been submitted and on February 4, 1980, a hearing was held before the Court.

This is an action brought under § 301 of the Labor Management Relations Act of 1947, 29 U.S.C. § 185, to recover certain sums allegedly owed by the defendant to various trust funds, pursuant to an agreement dated June 9, 1975. The parties agree that the agreement in question is a "prehire agreement" authorized by § 8(f) of the Act, 29 U.S.C. § 158(f), which provides in pertinent part as follows:

It shall not be an unfair labor practice under subsections (a) and (b) of this section for an employer engaged primarily in the building and construction industry to make an agreement covering employees engaged (or who, upon their employment, will be engaged) in the building and construction industry with a labor organization of which building and construction employees are members . . because (1) the majority status of such labor organization has not been established under the provisions of section 159 of this title prior to the making of such agreement . . . Provided further, That any agreement which would be invalid, but for clause (1) of this subsection, shall not be a bar to a petition filed pursuant to section 159(c) or 159(e) of this title.

29 U.S.C. § 158(f).

The defendant's primary contention is that, since the plaintiff union never achieved majority support among the defendant's employees, the § 8(f) agreement sued upon is unenforceable. In support of this contention, the defendant relies heavily on the recent Supreme Court decision in NLRB v. Iron Workers Local 103, 434 U.S. 335, 98 S.Ct. 651, 54 L.Ed.2d 586 (1978).

In Local 103, Higdon Construction Co. and Local 103 entered into a pre-hire agreement, obliging Higdon to abide by the terms of the multi-employer understanding between Local 103 and the Tri-State Iron Workers Employers Association, Inc. At about the same time, Higdon Contracting Company was formed for the express purpose of permitting the sole stockholder of both corporations, Gerald J. Higdon to continue to operate in disregard of the § 8(f) agreement and the multi-employer agreement. When the union was informed of this, it picketed two projects undertaken by Higdon Contracting Company. Local 103 had never represented a majority of the workers at either jobsite and, although it was free to do so, it did not petition for a representation election.

After thirty days of picketing, Higdon Contracting Company filed an unfair labor practice charge with the Regional Director of the National Labor Relations Board Board alleging that Local 103 was violating § 8(b)(7) of the Act, 29 U.S.C. § 158(b)(7). Section 8(b)(7) makes it an unlawful labor practice for an uncertified union to picket for more than thirty days for the purpose of forcing an employer to recognize the union as a bargaining representative of his employers, unless a petition for an election has been filed within that period.

At the outset, the Administrative Law Judge determined that Higdon Contracting Company was the alter ego of Higdon Construction Company and was thus bound by the pre-hire agreement. He then concluded that Local 103's picketing did not constitute an unfair labor practice. The purpose of the picketing was not to obtain recognition in violation of § 8(b)(7), but rather it was to secure compliance with an existing contract, the § 8(f) agreement.

This finding was appealed to the Board and was reversed. In so doing, the Board wrote:

In R. J. Smith Construction Co., Inc., the Board found that, although Section 8(f) of the Act clearly exempts a company and union from unfair labor practice liability for entering into a contract prior to establishment of the union as a majority representative, Section 8(f) does not protect the union from inquiry into its majority status during the contract term. The Board thus concluded that Section 8(f) only protects from illegality the preliminary contractual steps of a pre-hire agreement and that, where a union never thereafter obtains majority status, the company does not violate Section 8(a)(5) and (d) of the Act by refusing to continue the bargaining relationship established and by unilaterally changing terms and conditions of employment set forth in the contract. Since the Board found that the union had admittedly never attained majority status, it dismissed the refusal-to-bargain complaint.

. . . . .

From the foregoing, we conclude that the contract herein is an 8(f) contract and that no presumption of majority status attaches to it in the circumstances of this case. Accordingly, the duty of Higdon Construction and its alter ego, Higdon Contracting, to honor the Employer's collective-bargaining agreement with Local 103 is limited by the nature of 8(f) agreements. Under the doctrine set out in the cases cited above, the Employer could have terminated the agreement with Local 103 for projects not yet underway. For the Board to allow the Respondent to picket to enforce an 8(f) agreement if an employer decides to ignore it, as the Employer herein has done with respect to nonunion jobs, which Respondent could not enforce by means of obtaining an 8(a)(5) bargaining order, is to permit it to do by indirection what it could not do directly and in effect nullify our decisions in R. J. Smith and its progeny that such contracts are voidable by either party if a union never thereafter obtains majority status. In these circumstances, we conclude that the picketing by Respondent to enforce a noneffective 8(f) contract was for initial recognitional purposes and therefore was prescribed by Section 8(b)(7)(C) of the Act.

Ironworkers, Local 103 (Higdon Contracting Co.), 88 LRRM 1067, 1068, 1069 (1975).

The Board's holding was, in essence, that a § 8(f) agreement is "noneffective", and thus unenforceable if the union never thereafter obtains majority status, and that, therefore, the employer may freely decide to ignore it until such time as majority status is obtained.

Local 103 sought review in the United States Court of Appeals for the District of Columbia. The Appeals court set aside the Board's order, stating as follows:

It is our view that unions which are parties to pre-hire agreements have the right to complain of unfair labor practices, including alleged refusals by the employer to bargain collectively, before the union achieves a majority. Conversely, an employer who has entered into a validly executed Section 8(f) pre-hire agreement may, after a reasonable period, seek a representation election to challenge an enduring minority union. The Company here could have taken that step but did not. It was the Company, Higdon, which committed an unfair labor practice when, of its own motion, it refused to bargain collectively with the Union. The principles so stated are applicable here and must control. See Local No. 150 v. N.L. R.B., supra note 1, 156 U.S.App.D.C. 294 at 298, 299, 480 F.2d 1186 at 1190, 1191. Iron Workers, Local 103 v. NLRB, 175 U.S.App.D.C. 259, 262, 535 F.2d 87, 90 (D.C.Cir.1976).

The case was then appealed to the Supreme Court, which reversed the decision of the Court of Appeals and reinstated the Order of the Board. In a well reasoned opinion, the court held that a § 8(f) agreement was unenforceable until such time as the union achieves majority status.

The Union argues that the Board's position permitting an employer to repudiate a pre-hire agreement until the union attains majority support renders the contract for all practical purposes unenforceable, assertedly contrary to this Court's decision in Retail Clerks v. Lion Dry Goods, Inc., 369 U.S. 17 82 S.Ct. 541, 7 L.Ed.2d 503 (1962). There, the Court's opinion recognized that § 301 of the National Labor Relations Act confers jurisdiction on the federal courts to entertain suits on contracts between an employer and a minority union, as well as those with majority-designated collective-bargaining agents. Section 8(f) contracts were noted as being in this category. The Court was nevertheless speaking to an issue of jurisdiction. That a court has jurisdiction to consider a suit on a particular contract does not suggest that the contract is enforceable. It would not be inconsistent with Lion Dry Goods for a court to hold that the union's majority standing is subject to litigation in a § 301 suit to enforce a § 8(f) contract, just as it is in a § 8(a)(5) unfair labor practice proceeding, and that absent a showing that the union is the majority's chosen instrument, the contract is unenforceable. It is also clear from what has already been said, that the decision here is not inconsistent with Sullivan Electric Co., 146 N.L.R.B. 1086 (1964). That case merely permits picketing to enforce contracts with a union actually representing a majority of the employees in the unit. Here, the union did not represent the majority, and in picketing to enforce the pre-hire agreement, it sought the privileges of a majority representative. The conclusion that § 8(b)(7) was violated is legally defensible and factually acceptable.

NLRB v. Iron Workers, Local 103, supra, 434 U.S. at 351-52, 98 S.Ct. at 661.

Thus, in light of the Supreme Court's decision in Local 103, it is clear that a § 8(f) agreement cannot be...