Metropolitan Life Insurance Company v. NLRB, 6154.

• Decision Date: 17 February 1964
• Docket Number: No. 6154.,6154.
• Citation: 327 F.2d 906
• Parties: METROPOLITAN LIFE INSURANCE COMPANY, Petitioner, v. NATIONAL LABOR RELATIONS BOARD, Respondent.
• Court: U.S. Court of Appeals — First Circuit

327 F.2d 906 (1964)

METROPOLITAN LIFE INSURANCE COMPANY, Petitioner, v. NATIONAL LABOR RELATIONS BOARD, Respondent.

No. 6154.

United States Court of Appeals First Circuit.

Heard November 7, 1963.

Decided February 17, 1964.

Burton A. Zorn, New York City, with whom Jeremiah W. Mahoney, Boston, Mass., George G. Gallantz, Marvin Dicker, Thomas F. Delaney, New York City, Lyne, Woodworth & Evarts, Boston, Mass., and Proskauer, Rose, Goetz & Mendelsohn, New York City, were on brief, for petitioner.

Warren M. Davison, Atty., N. L. R. B., Washington, D. C., with whom Arnold Ordman, Gen. Counsel, Dominick L. Manoli, Associate Gen. Counsel, Marcel Mallet-Prevost, Asst. Gen. Counsel, and Gladys Kessler, Atty., N. L. R. B., Washington, D. C., were on brief, for respondent.

Before WOODBURY, Chief Judge, and HARTIGAN and ALDRICH, Circuit Judges.

WOODBURY, Chief Judge.

On petition of Insurance Workers' International Union, AFL-CIO, the National Labor Relations Board in a proceeding under § 9(c) of the Act, 29 U.S.C. § 159 (c), certified the Union as the bargaining representative of all debit insurance agents, including all canvassing regular and office account agents, at Metropolitan Life Insurance Company's district office in Woonsocket, Rhode Island. The Company deliberately refused to bargain collectively with the Union in order to challenge the appropriateness of the employee unit certified by the Board. See American Federation of Labor v. NLRB, 308 U.S. 401, 411, 60 S.Ct. 300, 84 L.Ed. 347 (1940); Pittsburgh Plate Glass Co. v. NLRB, 313 U.S. 146, 154, 61 S.Ct. 908, 85 L.Ed. 1251 (1941). The Company agrees with the Board's classifications of employees included and excluded. That is to say, the Company does not contend that the unit certified by the Board contains ineligible employees or employees whose interests are antagonistic. Its contention is that an employee unit consisting of the debit insurance agents working out of only its one Woonsocket district office is inappropriate. Its position is that the only appropriate unit would encompass either 1) all of its offices in the United States or 2) all of its offices in its New England Territory (Maine, New Hampshire, Vermont, Massachusetts and Rhode Island), or 3) all of its offices in Rhode Island. Furthermore, it says that in determining that the debit insurance agents at only one of its eight district offices in Rhode Island constituted an appropriate unit for collective bargaining, the Board treated as controlling the extent to which the Union had so far organized its employees in Rhode Island in clear violation of § 9(c) (5) added to the National Labor Relations Act by the Labor Management Relations Act, 1947, 61 Stat. 144 (1947), 29 U.S.C. § 159(c) (5), quoted in its pertinent context in the margin.¹

The Board's policy for determining appropriate bargaining units of debit insurance agents has not been consistent over the years. In Metropolitan Life Ins. Co., 56 NLRB 1635 (1944), the Board announced that, departing from its previous policy, it would in the future, in the absence of unusual circumstances, avoid setting up units of debit insurance agents smaller than state-wide in scope. It said:

"Based upon the extent of organization among employees of an employer, we have frequently found appropriate for bargaining purposes small groups of employees with a provision for revision of a unit upon a later showing of broader organization. We believe, however, that the principle upon which we have set up such units is not controlling in the instant case. Organization among insurance agents is comparatively recent, but is steadily growing. The tendency of such organization is toward State-wide units. * * * Thus, the rapid growth of union organization among insurance agents makes it clearly appear that provisional units less than State-wide in scope are, under ordinary circumstances, unnecessary to make collective bargaining reasonably possible for them if they desire it. Accordingly, we are of the opinion that, in the absences of unusual circumstances the practice of setting up units for insurance agents smaller that sic State-wide in scope should be avoided. In the instant case, since the * * * unions are all actively engaged in a broad organizational program in Ohio, and since it may reasonably be anticipated that one of these organizations may in the near future extend its membership to State-wide proportions, we are of the opinion that it will not effectuate the policies of the Act to set up city-wide units for employees of the Company in Ohio at this time." Id. at 1639-1640.

In 1961 a majority of the Board in Quaker City Life Ins. Co., 134 NLRB 960, changed the policy the Board had established in the Metropolitan Life Ins. Co. case in 1944 by determining that the debit insurance agents of Quaker City's one district office in Alexandria, Virginia, constituted an appropriate bargaining unit. The majority in the Quaker City case quoted from the language quoted above from the Metropolitan Life case and said:

"Clearly this language of the Metropolitan Life case indicates that the rule was adopted solely in anticipation of broader organization on a companywide or statewide basis, which at that time seemed imminent. As a practical matter, however, such statewide or companywide organization has not materialized, and the result of the rule has been to arrest the organizational development of insurance agents to an extent certainly never contemplated by the Act, or for that matter, by the Board that decided the Metropolitan Life case. There is no longer any rational basis for applying different rules of organization to the insurance industry than are applied to other industries. The rule was adopted for the purpose of permitting organization on a statewide or employerwide basis, which did not develop as anticipated. Contrary to our dissenting colleagues, we regard this as a valid reason for changing the rule. Obviously, when the purpose for which a rule has been established fails, the rule should also fail. This is especially so with respect to a rule which unfairly prejudices the collective-bargaining rights of employees. Accordingly, in the future, the Board\'s policy will be not to preclude the organization of insurance agents into units of less than employerwide or statewide scope, and we shall apply our normal unit principles to the cases as they arise. In the instant case, upon the record as a whole, and especially in view of the autonomous day-to-day operation of the district office here, the overall immediate supervision by the district manager, the lack of contact or interchange among employees of the various district offices, and the absence of any administrative subdivision between the home office and the district office, we find the district office unit to be appropriate." Quaker City Life Ins. Co., 134 NL RB 960, 962 (1961).

The two dissenting members of the Board said that they could see "no valid reason for departing from the Metropolitan Life rule which the Board adopted in 1944." Id.

The United States Court of Appeals for the Fourth Circuit, Judge Boreman dissenting, enforced an order of the Board requiring Quaker City Life Insurance Company to bargain collectively with the same union involved herein as the bargaining representative of the unit certified by the Board in its underlying representation proceeding. NLRB v. Quaker City Life Insurance Company, 319 F.2d 690 (C.A.4, 1963), enforcing 138 NLRB 61 (1962).

In subsequent cases a majority of the Board, with the same two members dissenting, certified as appropriate units consisting of nine of Metropolitan's district offices in the Cleveland, Ohio, metropolitan area (six offices in the City and three suburban offices eight or nine miles distant), Metropolitan Life Ins. Co., 138 NLRB 512 (1962), unfair labor practice decision, 141 NLRB No. 96 (1963) on appeal to Sixth Circuit, Case No. 15366; two of Metropolitan's three district offices in Delaware, Metropolitan Life Ins. Co., 138 NLRB 565 (1962), unfair labor practice decision, 141 NLRB No. 37 (1963) on appeal to Third Circuit, Case No. 14390, 328 F.2d 820. Metropolitan's single district office in Sioux City, Iowa, together with two detached offices under its administrative control in Fargo, North Dakota, and Sioux Falls, South Dakota, 284 and 120 miles distant, respectively, from Sioux City, Metropolitan Life Ins. Co., 138 NLRB 734 (1962); and all of Metropolitan's district offices within the political limits of the City of Chicago, thereby excluding suburban offices even though six of the thirty-three city district offices had territories extending beyond the city limits and three of the fourteen suburban offices had territories extending into the city. Metropolitan Life Ins. Co., 144 NLRB No. 15 (1963). In Equitable Life Ins. Co., 138 NLRB 529 (1962), the Board determined appropriate a unit consisting of two district offices in Cleveland, Ohio, with a detached office in Lorain, Ohio, 28 miles away. And in this case the Board majority relying on prior decisions determined that one district office out of eight in a small densely populated state constituted an appropriate bargaining unit. The...