NATIONAL LAB. REL. BD. v. Technicolor Motion Pic. Corp.

• Decision Date: 24 September 1957
• Docket Number: No. 15297.,15297.
• Parties: NATIONAL LABOR RELATIONS BOARD, Petitioner and Respondent, v. TECHNICOLOR MOTION PICTURE CORPORATION and Local 683 of the International Alliance of Theatrical Stage Employees and Moving Picture Machine Operators of the United States and Canada, A.F.L.-C.I.O., Respondents and Cross-Petitioners.
• Court: U.S. Court of Appeals — Ninth Circuit

248 F.2d 348 (1957)

NATIONAL LABOR RELATIONS BOARD, Petitioner and Respondent, v. TECHNICOLOR MOTION PICTURE CORPORATION and Local 683 of the International Alliance of Theatrical Stage Employees and Moving Picture Machine Operators of the United States and Canada, A.F.L.-C.I.O., Respondents and Cross-Petitioners.

No. 15297.

United States Court of Appeals Ninth Circuit.

September 24, 1957.

Kenneth C. McGuiness, General Counsel, Stephen Leonard, Associate General

Counsel, Marcel Mallet-Prevost, Asst. General Counsel, Owsley Vose, Frederick U. Reel, Attorneys, N. L. R. B., Washington, D. C., for petitioner.

Cohen & Roth, Beverly Hills, Cal., Gilbert, Nissen & Irvin, Robert W. Gilbert, Los Angeles, Cal., for respondent.

Edward J. Hickey, Jr., Washington, D. C., for amicus curiae, Railway Labor Executive's Ass'n.

Before HEALY, BARNES and HAMLEY, Circuit Judges.

BARNES, Circuit Judge.

The National Labor Relations Board, acting pursuant to Section 10(e) of the National Labor Relations Act, as amended,¹ seeks a decree enforcing its Order issued against Respondents Technicolor Motion Picture Corporation and Local 683 of the International Alliance of Theatrical Stage Employees and Moving Picture Machine Operators of the United States and Canada, A.F.L.-C.I.O., (hereinafter referred to respectively as "the Company" and "the Union"), following a finding of unfair labor practices committed by them. The named Respondents cross-petition to have the Order set aside.

The petition and cross-petition raise an important and apparently novel question concerning the construction of (1) the first proviso to Section 8(a) (3) of the Act, which authorizes an employer and a labor organization to enter into a collective bargaining agreement, one of the terms of which may be "to require as a condition of employment membership (in the union) on or after the thirtieth day following the beginning of such employment or the effective date of such agreement, whichever is the later," provided certain prerequisites are met;² and (2) an agreement executed thereunder. The question is whether or not an employee's belated tender of a delinquent union initiation fee, made prior to actual discharge, renders unlawful a subsequent discharge based upon non-compliance with the time provisions of an admittedly valid union security agreement.

The formal pleadings and a stipulation of material facts, including two exhibits, comprise the entire record in the instant case.³ The stipulation discloses that on or about July 31, 1954, the Company and the Union executed a valid union security contract requiring inter alia that all persons then in the Company's employ subject to the agreement become and remain union members on and after the thirtieth day following the effective date of the agreement (which was the date of execution) and that within "a reasonable time, but not to exceed 3 days, after receipt of written notice from the Union that any such employee is not a member as above required," the Company "shall discharge any such employee." Hayden Balthrope, an employee of the Company, did not apply for membership in the Union nor tender his initiation fees during the thirty day grace period, although he was apprised of the union security provisions of the agreement shortly after its execution. Consequently, on August 31, 1954, the Union, in accordance with the terms of the agreement, made a lawful written demand on the Company calling for Balthrope's discharge within three days thereafter. No action was taken on this demand. The Union repeated its demand on October 1, 1954, and subsequently made numerous oral demands for Balthrope's discharge until some unspecified date in January of 1955. All of these demands went unheeded. The stipulation states that the Company's failure to accede to these demands was based on "unexplained" reasons. No further enlightenment is shed on this point by the record. Meanwhile, on December 7, 1954, after steadfastly refusing to do so for over four months, Balthrope applied for Union membership and tendered a check in the amount of $250.00, the established initiation fee uniformly required of all prospective members and the only sum requested by the Union. On or about January 27, 1954, Balthrope informed the Company of the action he had taken.⁴ His application for membership was conditionally approved by the Executive Board of the Union on February 7, 1955. Three days later, February 10, 1955, the Company discharged him. The stipulation is silent as to whether the Company knew of the Union's acceptance of Balthrope's initiation fee when it discharged him. That very same day and after it was notified of Balthrope's discharge, the Union wrote him that its Executive Board had conditionally approved his application for membership and that it had arranged employment for him at a comparable wage rate with another employer in the same industry.

Upon a charge lodged by Balthrope based on the foregoing facts, the General Counsel of the Board issued a consolidated complaint against the Union and the Company alleging that the Union by causing the Company to discharge Balthrope after he had paid his initiation fee violated sections 8(b) (1) (A) and 8(b) (2) of the Act and that the Company by yielding to the Union's demand violated sections 8(a) (1) and 8(a) (3) of the Act.⁵ A hearing was held before a trial examiner on the stipulated facts. The Trial Examiner then filed an exhaustive Intermediate Report concluding that there was no violation of the Act by either the Company or the Union and recommending that the consolidated complaint be dismissed. The Board, by a three to two vote, reversed the Trial Examiner's ultimate findings and sustained all of the charges contained in the consolidated complaint.⁶ It ordered the Respondents to cease and desist from the unfair labor practices, effectuate Balthrope's reinstatement with back pay and post specified notices regarding their future conduct.

In reaching their decision the Board's majority relied without discussion on the broad doctrine promulgated by the Board in the Aluminum Workers case.⁷ That case, involving an employee purportedly delinquent in the payment of her periodic union dues, held that "* * * a full and unqualified tender made any time prior to actual discharge, and without regard as to when the request for discharge was made, is a proper tender and a subsequent discharge based upon the request is unlawful." The two dissenting Board members, like the Trial Examiner, felt the Aluminum Workers doctrine was inapplicable to a case involving an initiation fee because of the different treatment accorded initiation fees and periodic dues in the Act and certain fundamental distinctions between them with respect to an employee's obligations to a union.

Our initial concern is, of course, with the germane provisions of the Act and, for purposes of clarity, we deem it desirable to set forth those subsections at the outset of our discussion. The first proviso to § 8(a) (3), which sanctions union security agreements, has been noted already. § 8(a) (1) (relating to the employer) and § 8(b) (1) (A) (relating to the union) make it an unfair labor practice "to interfere with, restrain, or coerce employees in the exercise of rights guaranteed in section 7;" which include "the right to refrain" from union activities "except to the extent that such right may be affected by an agreement requiring membership in a labor organization as a condition of employment as authorized in section 8(a) (3)." Further, § 8(a) (3), made applicable to unions by § 8(b) (2), prohibits an employer from "discrimination in regard to hire or tenure of employment or any term or condition of employment to encourage or discourage membership in any labor organization" except as provided in the succeeding proviso authorizing union security agreements. Even under such a union security agreement any discrimination based on non-membership is strictly limited. An employee need only tender his initiation fee and periodic dues to avoid discriminatory action including, of course, discharge. This is made clear by the second proviso to § 8(a) (3) that under a union security agreement an employer cannot justify discrimination against an employee for non-membership in the union if he has reasonable grounds for believing that such membership "was not available to the employee on the same terms and conditions generally applicable to other members, or * * * was denied or terminated for reasons other than the failure of the employee to tender the periodic dues and the initiation fees uniformly required as a condition of acquiring or retaining membership." Likewise, a union is forbidden by § 8(b) (2), "To cause or attempt to cause an employer to discriminate against an employee in violation of subsection (a) (3) of this section or to discriminate against an employee with respect to whom membership in such organization has been denied or terminated on some ground other than his failure to tender the periodic dues and the initiation fees uniformly required as a condition of acquiring or retaining membership."

We understand the Board's position to be that the above statutory provisions embody Congressional recognition of the problem of so-called "free riders;" (i. e., those employees who enjoy the benefits of union representation under union agreements without contributing to the financial support of the union by paying initiation fees and periodic dues), and authorization to deal with this problem by permitting unions operating under such agreements to cause the discharge of those employees who are "free riders;" that Balthrope was such a "free rider" after the expiration of the thirty day grace period; that under the Act and the collective bargaining agreement the power was vested in the Union to cause, and the Company to effect, a lawful discharge of Balthrope so long as the initiation fee remained due and untendered; that upon...