National Labor Relations Bd. v. WEST KENTUCKY C. CO.

• Decision Date: 15 November 1940
• Docket Number: No. 8334.,8334.
• Parties: NATIONAL LABOR RELATIONS BOARD v. WEST KENTUCKY COAL CO.
• Court: U.S. Court of Appeals — Sixth Circuit

116 F.2d 816 (1940)

NATIONAL LABOR RELATIONS BOARD v. WEST KENTUCKY COAL CO.

No. 8334.

Circuit Court of Appeals, Sixth Circuit.

November 15, 1940.

COPYRIGHT MATERIAL OMITTED

Philip G. Phillips, of Cincinnati, Ohio (Charles Fahy, Robert B. Watts, Laurence A. Knapp, Richard C. Barrett, and A. Norman Somers, all of Washington, D.C., on the brief), for petitioner.

Maurice K. Gordon and Gordon & Gordon & Moore, all of Madisonville, Ky., and James G. Wheeler, of Paducah, Ky., (Maurice K. Gordon, James G. Wheeler, Neville Moore, Earle M. Nichols, and Abner Johnston, Jr., all of Madisonville, Ky., on the brief), for respondent.

Chas. G. Franklin, of Madisonville, Ky. for intervenor.

Before SIMONS, ALLEN and ARANT, Circuit Judges.

ARANT, Circuit Judge.

Charges of unfair labor practices were filed with the National Labor Relations Board against respondent by the United Mine Workers of America, District No. 23, in the summer of 1937. On December 2, the Board issued its complaint and served notice of hearing upon the Union and respondent. The Employes' Mutual Benefit Association was permitted to intervene. After hearing, the Board issued an order, which it now petitions this Court to enforce.

The complaint charged that respondent had dominated and interfered with the administration of the Employes' Mutual Benefit Association and contributed financial and other support; that it had discriminated against certain employees by discharging them for union activity and membership; that it had refused to bargain collectively with the Union as representative of the production employees in its mines 2 and 8; and that it had otherwise interfered with, restrained and coerced employees in the exercise of rights guaranteed by § 7 of the National Labor Relations Act, thereby engaging in unfair labor practices within the meaning of § 8 (1), (2), (3) and (5) and § 2 (6) and (7) of the Act, 29 U.S.C.A. §§ 157, 158 (1-3, 5) 152(6,7).

Respondent claimed that the operation of its business did not affect interstate commerce within the meaning of the Act and denied that it had committed any of the unfair labor practices charged. The Association denied that it had been dominated, interfered with, or supported by respondent since October, 1935, but admitted that it had received financial contributions from respondent theretofore.

On the last day of the hearing the Union filed a petition requesting the Board to conduct an investigation and certify the bargaining representative of respondent's production employees in mines 2 and 8. Separate hearing upon this petition was waived by stipulation, the parties agreeing that, in its investigation of the question of representation, the Board might consider the record in the complaint proceeding, which contained all the pertinent evidence. The two proceedings were thereupon consolidated.

The Board found that since July 5, 1935, the effective date of the Act, respondent had dominated and interfered with the administration of the Association and had contributed financial and other support; that it had discriminated in respect to hire and tenure by discharging five employees because of union activity and membership; and that it had otherwise interfered with, restrained and coerced its employees in the exercise of rights guaranteed in § 7 of the Act. The Board concluded that respondent had engaged and was engaging in unfair labor practices affecting interstate commerce within the meaning of § 8(1), (2) and (3) and § 2(6) and (7) of the Act. Such portions of the complaint as charged that respondent had discriminated against Albert Johnson, Miles Cannon and George Hughes, and had refused to bargain collectively with the Union were dismissed.

The Board ordered respondent to cease and desist from the unfair labor practices found; to disestablish, withdraw all recognition from and cease giving effect to contracts made with the Association as representative of its employees; to reimburse employees for all deductions from their wages for Association dues or assessments since July 5, 1935; to reinstate, with back pay, the five employees found to have been unfairly discharged; and, upon request, to bargain collectively with the United Mine Workers of America, District No. 23, in the event that it is certified as the exclusive bargaining representative after the election ordered by the Board.

Respondent is a New Jersey corporation. It operates eight coal mines in three counties in Western Kentucky, in which its production employees number 2,500. Its annual production exceeds 2,000,000 tons, fifty-nine percent of which is shipped to points outside Kentucky. Its mines are connected to interstate railroads, to which it sells about 300,000 tons of coal annually. It owns and uses ten miles of railroad, three locomotives, a number of cars and a car shop. It controls coal yards in Kentucky, Tennessee, Indiana and Nebraska, in which coal mined by itself and others is sold. At Paducah, Kentucky, it maintains and operates facilities for the transportation of coal on the Ohio River. It also operates steam and tug boats on the Mississippi. Eighty percent of its supplies and equipment are purchased outside of Kentucky, amounting annually to some $300,000. It is clearly subject to the jurisdiction of the Board. Cf. National Labor Relations Board v. Jones & Laughlin Steel Corp., 301 U.S. 1, 57 S.Ct. 615, 81 L.Ed. 893, 108 A.L.R. 1352; Santa Cruz Fruit Packing Co. v. N. L. R. B., 303 U.S. 453, 58 S.Ct. 656, 82 L.Ed. 954; National Labor Relations Board v. Fainblatt, 306 U.S. 601, 59 S.Ct. 668, 83 L.Ed. 1014.

The Association was established under the direction of Respondent's president, in September, 1918. It was originally governed by a joint council of seven, three of whom were appointed by the management, while the remaining four were selected by the employees at elections held on the company time and property. Employees generally understood that membership in the Association was compulsory, and practically every employee joined. Respondent's president and general superintendent, as well as other executive and supervisory officials, were members, regularly attended meetings and participated in the discussions.

Terms and conditions of employment were established annually by contract between respondent and the employee members of the joint council. Proposed contracts were not discussed at Association meetings, approval of the employees being inferred from the fact of membership alone. Membership dues were deducted by respondent from employees' earnings and paid to the Association, respondent contributing an equal amount and receiving therefor certificates of membership entitling it to a voting power on amendments to the articles of association equal to that of all employees combined. A three-fourths vote was required to amend the articles.

This was the situation until the latter part of 1933, when the Association's articles were amended to provide that the council should consist of four members only, elected by employees. Management membership continued, however, until February of 1937. The provision for direct financial support was eliminated from the articles in 1934, but respondent actually contributed until September, 1935. Through its attorneys, it also participated in such changes in the articles as were made. The practice of holding elections on company time and property has not been discontinued. Membership in the Association is still considered a condition of employment, virtually every employee belonging, and respondent continues to deduct Association dues from wages. Terms of proposed contracts are not discussed at meetings, and members of the Association generally are still unaware that any substantial change has been made in the Association since its inception. The Association's assets consist largely of buildings used for Association purposes, acquired through transactions with respondents.

It would unduly lengthen this opinion to discuss the evidence in detail, but there was substantial evidence that in April of 1937, when the Union began a drive to organize respondent's mines, respondent engaged in an active campaign to coerce employees to support the Association and abstain from joining the Union. Employees were followed by guards, their homes were entered under flimsy pretexts while Union representatives were visiting them, and those suspected of Union sympathy were told that the company stood by those who stood by it.

There was substantial evidence that respondent violated § 8(1) and (2) as found by the Board, and the cease and desist order will be enforced. Cf. National Labor Relations Board v. Pennsylvania Greyhound Lines, Inc., 303 U.S. 261, 58 S.Ct. 571, 82 L.Ed. 831, 115 A.L.R. 307.

Relying upon § 10(c), the Board ordered respondent to disestablish the Association completely as a bargaining representative and give effect to no labor agreement with it. Respondent contends that this section grants absolute and arbitrary power and is "too vague and indefinite to be of any validity." The contrary is now almost too well settled to need citation of authority, but see National Labor Relations Board v. Pennsylvania Greyhound Lines, Inc., supra; National Labor Relations Board v. Newport News Shipbuilding & Dry Dock Co., 308 U.S. 241, 60 S.Ct. 203, 84 L.Ed. 219; National Labor Relations Board v. Falk Corp., 308 U.S. 453, 60 S.Ct. 307, 84 L.Ed. 396. The Association asserts that the order deprives it of property without due process of law and that, in consequence, we cannot constitutionally be denied the right to review all the evidence and make our own findings therefrom. We have reviewed all the evidence: the Board's findings are not only supported by substantial evidence but, in our opinion, correct. The order based thereon will be enforced. National Licorice Co. v. N. L. R. B., 309 U.S. 350, 60 S.Ct. 569, 84 L.Ed. 799.

The Board ordered respondent to "Reimburse, individually and in full, all...