Diamond Shamrock Co. v. NLRB

• Decision Date: 11 May 1971
• Docket Number: No. 18567.,18567.
• Citation: 443 F.2d 52
• Parties: DIAMOND SHAMROCK CO., Petitioner, v. NATIONAL LABOR RELATIONS BOARD, Respondent.
• Court: U.S. Court of Appeals — Third Circuit

443 F.2d 52 (1971)

DIAMOND SHAMROCK CO., Petitioner, v. NATIONAL LABOR RELATIONS BOARD, Respondent.

No. 18567.

United States Court of Appeals, Third Circuit.

Argued February 2, 1971.

Decided May 11, 1971.

Harold Krieger, Krieger, Chodash & Politan, Jersey City, N. J. (Lewis C. Stanley, Jersey City, N. J., on the brief), for petitioner.

Lawrence H. Pelofsky, Atty., N. L. R. B., Washington, D. C. (Arnold Ordman, Gen. Counsel, Dominick L. Manoli, Associate Gen. Counsel, Marcel Mallet-Prevost, Asst. Gen. Counsel, Nancy M. Sherman, Atty., N. L. R. B., Washington, D. C., on the brief), for respondent.

Before McLAUGHLIN and VAN DUSEN, Circuit Judges, and HANNUM, District Judge.

OPINION OF THE COURT

VAN DUSEN, Circuit Judge.

This case is before the court on a petition of the Diamond Shamrock Co. (Company) to review and set aside an order of the National Labor Relations Board (Board) issued on February 20, 1970.¹ The Board filed a cross-application for enforcement of its order. This court has jurisdiction under section 10 (f) of the National Labor Relations Act, 29 U.S.C. § 160(f) (1964).

This case presents the question whether an employer commits an unfair labor practice when it applies and enforces a non-discriminatory² rule barring off-duty employees³ from all production areas and certain secured non-production areas of the plant, absent a showing of organizational need for access to those areas. Otherwise stated, the issue is whether the Board can order an employer to permit off-duty employees to have access to all non-production areas of the plant, including secured areas, for purposes of soliciting union support, absent a showing that without such access the organizing employees would have no reasonably adequate means of communicating with other employees.

The Company is engaged in the manufacture of chlorine, caustic soda, caustic potash, hydrogen, polyvinyl-chloride resins, and anhydrous caustic soda at its plant in Delaware City, Delaware. The plant property is divided into two parts, a part enclosed by a wire fence and a part outside the fence. Outside the fence is the Company's office building and a parking lot, where virtually all employees park. A walkway leads from the parking lot to the main gate, where there is a guard house manned by a security officer, and which is used by virtually all production and maintenance employees as a means of access to the production area of the plant. The no-access rule in question does not apply to any of these areas outside the fence. Inside the fence, the chief purpose of which is security, is the production area, as well as a change room building, which contains locker rooms, rooms for hanging work clothes to dry, shower rooms, toilets and lunchrooms. The no-access rule in question applies to all of these secured areas inside the fence.

The Company's no-access rule denies free access to the plant area inside the fence to off-duty employees, with the exception that it does not deny access to the plant area inside the fence to employees who are off-duty but are in the fenced area in connection with their work. That is, it does not deny access to the plant area inside the fence to employees who are there within thirty minutes of the beginning or end of their shift, in order to prepare for work or for returning home after work. The no-access rule does not deny free access to the plant area outside the fence to off-duty employees at any time. Thus the no-access rule is limited in operation to the area inside the fence, and to off-duty, unwork-connected employees.⁴

The Company does not have a no-solicitation rule⁵ or a no-distribution rule.⁶ Employees are able to solicit and distribute on behalf of the union and otherwise engage in union activity at all times outside the fence. Inside the fence, on-duty employees⁷ and off-duty employees present in connection with their work, in accordance with the no-access rule, are permitted to engage in union solicitation and distribution during non-work time⁸ in all non-work areas. The lawfulness of the limitation on solicitation and other union activity, restricting it to non-work time in non-work areas, has not been challenged in this case. Only the validity of the no-access rule is at issue in this case.⁹

The General Counsel's complaint charged that the no-access rule and its application to prevent union solicitation inside the fenced area by off-duty, un-work-connected employees constituted an unfair labor practice within the meaning of section 8(a) (1) of the National Labor Relations Act. Section 8(a) (1), 29 U.S.C. § 158(a) (1) (1964), makes it an unfair labor practice for an employer "to interfere with, restrain, or coerce employees in the exercise of the rights guaranteed" in section 7 of the Act. Section 7, 29 U.S.C. § 157 (1964), provides in relevant part:

Employees shall have the right to self-organization, to form, join, or assist labor organizations, to bargain collectively through representatives of their own choosing, and to engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection, * * *

The Trial Examiner, in an extensive opinion, concluded that the Company had not engaged in unfair labor practices in violation of section 8(a) (1) of the Act. The Board adopted the factual findings of the Trial Examiner, but concluded that the no-access rule and its application to prevent union solicitation inside the fenced area by off-duty unwork-connected employees constituted unfair labor practices within the meaning of section 8(a) (1) of the Act. The Board therefore ordered the Company, inter alia, to cease and desist from "applying and enforcing at its Delaware City, Delaware, plant any rule which prohibits its employees from entering or returning to the premises of the plant during their non-working time to solicit union support in non-working areas of the plant."

In invalidating the no-access rule, insofar as it prevents off-duty, unwork-connected employees from engaging in union solicitation inside the fenced area, the Board relied primarily on its decision in Peyton Packing Co., 49 N.L.R.B. 828 (1943), enforced, 142 F.2d 1009 (5th Cir.), cert. denied, 323 U.S. 730, 65 S.Ct. 66, 89 L.Ed. 585 (1944). In Peyton Packing the Board stated:

The Act, of course, does not prevent an employer from making and enforcing reasonable rules covering the conduct of employees on company time. Working time is for work. It is therefore within the province of an employer to promulgate and enforce a rule prohibiting union solicitation during working hours. Such a rule must be presumed to be valid in the absence of evidence that it was adopted for a discriminatory purpose. It is no less true that time outside working hours, whether before or after work, or during luncheon or rest periods, is an employee\'s time to use as he wishes without unreasonable restraint, although the employee is on company property. It is therefore not within the province of an employer to promulgate and enforce a rule prohibiting union solicitation by an employee outside of working hours, although on company property. Such a rule must be presumed to be an unreasonable impediment to self-organization and therefore discriminatory in the absence of evidence that special circumstances make the rule necessary in order to maintain production or discipline.

49 N.L.R.B. at 843-44.

This language from Peyton Packing was specifically approved by the Supreme Court in Republic Aviation Corp. v. NLRB, 324 U.S. 793, 804, 65 S.Ct. 982, 89 L.Ed. 1372 (1945). The Board contends that the Peyton Packing presumption applies in this case. We cannot agree.

Peyton Packing involved a no-solicitation rule that barred union solicitation by employees on company premises during non-working time as well as during working time. Republic Aviation likewise involved no-solicitation rules¹⁰ that barred solicitation by employees on company premises during non-working time as well as during working time. The rules in those cases operated to restrict the section 7 organization rights of employees, properly on company premises pursuant to the work relationship, during their non-working or free time, such as lunch time and break time. The challenged rule in the instant case does not bar solicitation on company premises.

Employees of the Company are free to solicit on behalf of the union during their on-duty non-working time on all company premises, and are free to solicit on behalf of the union during their off-duty time on all company premises outside the fence. The challenged rule simply operates to bar off-duty employees from returning to or remaining on the plant premises inside the fence after working hours. The Board has cited no case where the Peyton Packing presumption, now almost 28 years old, has been applied to invalidate a no-access rule like the one involved in this case.

The no-solicitation rules in Peyton Packing and Republic Aviation were directed toward on-duty employees, as well as off-duty employees, and operated to prevent solicitation in all parts of the company premises, during non-working as well as working time. The no-access rule in the instant case is directed only toward off-duty employees, and operates to bar them from only a part of the Company premises. Because the no-solicitation rules in Peyton Packing and Republic Aviation were directed toward on-duty employees lawfully and properly on company premises pursuant to the work relationship, and because the no-access rule in the instant case is directed only toward off-duty employees not lawfully and properly on Company premises pursuant to the work relationship, we cannot agree with the Board's argument that the Peyton Packing presumption and its approval in Republic Aviation end our inquiry. In short, quite different considerations are presented by the instant case.

In Peyton Packing and Republic Aviation, there was little reason for concern about the...