Contractors, Laborers, Teamsters and Engineers Health & Welfare Plan v. Associated Wrecking Co., No. 1140

• Court: United States Courts of Appeals. United States Court of Appeals (8th Circuit)
• Writing for the Court: Before GIBSON, Senior Circuit Judge, HEANEY and BRIGHT; BRIGHT; Gibbons
• Citation: 638 F.2d 1128
• Decision Date: 21 January 1981
• Docket Number: No. 80-1191,No. 1140,A
• Parties: 106 L.R.R.M. (BNA) 2257, 90 Lab.Cas. P 12,507, 2 Employee Benefits Ca 1020 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, Localppellants, v. ASSOCIATED WRECKING COMPANY, a Nebraska Corporation, Appellee.

Page 1128

638 F.2d 1128 106 L.R.R.M. (BNA) 2257, 90 Lab.Cas. P 12,507,
2 Employee Benefits Ca 1020 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, Appellants,
v.
ASSOCIATED WRECKING COMPANY, a Nebraska Corporation, Appellee. No. 80-1191. United States Court of Appeals,
Eighth Circuit. Submitted Nov. 12, 1980.
Decided Jan. 21, 1981.

Page 1129

David D. Weinberg, Weinberg & Weinberg, P. C., Malcolm D. Young, Duncan A. Young, Young & White, Omaha, Neb., for appellants.

Michael W. Heavey, Dwyer, O'Leary & Martin, P. C., Omaha, Neb., for appellee.

Before GIBSON, Senior Circuit Judge, HEANEY and BRIGHT, Circuit Judges.

BRIGHT, Circuit Judge.

This case presents an issue of first impression in this court in the labor relations field: whether the fringe benefit provisions of a prehire agreement, authorized by section 8(f) of the National Labor Relations Act, 29 U.S.C. § 158(f) (1976), may be enforced against an employer even though the labor organization with which the employer executed the agreement never has achieved majority status among the employer's workers. The district court denied enforcement of the agreement. Contractors, Laborers, Teamsters and Engineers Health & Welfare Plan v. Associated Wrecking Co., 484 F.Supp. 582 (D.Neb.1980). ¹ We reverse.

I. Background.

On June 9, 1975, Omaha-Council Bluffs Local No. 1140 (Local 1140 or the Union) and Associated Wrecking & Salvage Company (Employer or the Company) executed a "participation agreement" in which the parties agreed to abide by the terms and provisions of several collective bargaining agreements reached by the Union with various contractors' associations operating in Omaha and Lincoln, Nebraska, and Council Bluffs, Iowa. The participation agreement required the Company to make contributions to the Contractors, Laborers, Teamsters and Engineers Health & Welfare Plan, the Omaha-Council Bluffs Laborers Local No. 1140 Holiday Trust, the Contractors, Laborers, Teamsters and Engineers Pension Plan, and the Laborers' Training Fund (collectively, the Trusts), ² for each hour worked by employees of the Company on its projects. That agreement, which both the parties and the district court characterize as a "prehire agreement" within the meaning of section 8(f) of the Act, also bound the Employer to any amendments, modifications, or changes executed by the Union and the contractors' associations with respect to contributions to the Trusts.

Page 1130

On August 2, 1977, Local 1140 and the Trusts brought this action against the Company under section 301 of the Labor-Management Relations Act of 1947, 29 U.S.C. § 185 (1976), seeking specific enforcement of the prehire agreement for contributions allegedly owed by the Company to the Trusts. ³ The Company moved for summary judgment on the ground that neither the Union nor the Trusts could enforce the agreement against the Company absent a showing that the Union ever had obtained majority support among the Company's employees. After determining as a matter of law that Local 1140 had never represented a majority of the Company's workers, the district court granted the Company's motion and dismissed the action. ⁴

On appeal, the Union and the Trusts contend (1) that the absence of majority status does not preclude enforcement of the fringe benefit provisions of a prehire agreement; (2) that an employer may not assert a union's lack of majority support as a defense to an action by a trust fund to recover unpaid contributions required by a prehire agreement; and (3) that a prehire agreement, even in the absence of majority status, may be enforced against an employer until the employer takes affirmative steps to void the agreement. We agree with appellants' first contention and, therefore, need not address the remaining arguments. ⁵

II. Discussion.

Section 8(f) of the National Labor Relations Act permits an employer engaged in the building and construction industry to enter into a prehire agreement with a labor organization before the majority status of that organization has been established in accordance with the recognitional provisions of the Act. In pertinent part, section 8(f) provides:

(f) 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 (not established, maintained, or assisted by any action defined in subsection 8(a) of this section as an unfair labor practice) 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) (1976).)

Judge Gibbons aptly explained the genesis of this section in NLRB v. Irvin, 475 F.2d 1265, 1267 (3d Cir. 1973):

Section 8(f) was enacted as Section 705 of the Labor-Management Reporting and

Page 1131

Disclosure Act of 1959, Pub.L. No. 86-257, 73 Stat. 519. It amended Section 8 of the National Labor Relations Act by adding a new subsection, applicable to the construction industry, providing among other things that it would not be, as it would otherwise have been, an unfair labor practice for an employer engaged primarily in that industry, to make a collective bargaining agreement with a labor organization covering its employees prior to the time the majority status of that labor organization had been established in a manner authorized by Section 9 of the Act, 29 U.S.C. § 159. The amendment was adopted to meet specific problems which had arisen in the construction industry under the prior law because of the transitory nature of the employer-employee relationship in that industry. During the Wagner Act period the Board had declined to exercise jurisdiction over the industry. In 1947, after passage of the Taft-Hartley amendments, the Board applied the provisions of the Act to the industry with consequent difficulties. These difficulties are discussed in Senate Report No. 187, House Report No. 741, and Conference Report No. 1147, 86th Cong., 1st Sess. (1959). 1959 U.S.Code Cong. & Ad.News, 86th Cong., 1st Sess. 2318, 2344, 2441, 2513. In summary, prehire agreements which would otherwise be invalid were authorized in the construction industry because of the dual necessities (1) that construction bidders know in advance of bid what their labor costs would be, and (2) that construction employers have access to an available pool of skilled craftsmen for quick reference.

The Supreme Court has addressed the provisions of section 8(f) indirectly in Retail Clerks Int'l Ass'n, Local Unions Nos. 128 and 633 v. Lion Dry Goods, Inc., 369 U.S. 17, 82 S.Ct. 541, 7 L.Ed.2d 503 (1962), and directly, but in a context different from the instant litigation, in NLRB v. Local Union No. 103, Int'l Ass'n of Bridge, Structural & Ornamental Iron Workers, 434 U.S. 335, 98 S.Ct. 651, 54 L.Ed.2d 586 (1978).

In Lion...