NLRB v. Davison

• Decision Date: 28 May 1963
• Docket Number: No. 8759.,8759.
• Citation: 318 F.2d 550
• Parties: NATIONAL LABOR RELATIONS BOARD, Petitioner, v. F. McKenzie DAVISON, W. J. Hardy, Sr., and W. J. Hardy, Jr., d/b/a Arlington Asphalt Company, Respondent.
• Court: U.S. Court of Appeals — Fourth Circuit

318 F.2d 550 (1963)

NATIONAL LABOR RELATIONS BOARD, Petitioner, v. F. McKenzie DAVISON, W. J. Hardy, Sr., and W. J. Hardy, Jr., d/b/a Arlington Asphalt Company, Respondent.

No. 8759.

United States Court of Appeals Fourth Circuit.

Argued January 11, 1963.

Decided May 28, 1963.

Melvin J. Welles, Attorney, National Labor Relations Board (Stuart Rothman, General Counsel, Dominick L. Manoli, Associate General Counsel, Marcel Mallet-Prevost, Asst. General Counsel, and Lee M. Modjeska, Attorney, National Labor Relations Board, on brief), for petitioner.

William B. Devaney, Washington, D. C. (Charles G. Williamson, Jr., and Steptoe & Johnson, Washington, D. C., on brief), for respondent.

Before SOBELOFF, Chief Judge, and BRYAN and J. SPENCER BELL, Circuit Judges.

SOBELOFF, Chief Judge.

The National Labor Relations Board petitions for enforcement of its order of March 30, 1962, in which the employer-respondent¹ was found to have committed unfair labor practices in violation of section 8(a) (5) and (1) of the National Labor Relations Act, 29 U.S.C.A. § 158 (a) (5) and (1), by insisting to an impasse upon a voluntary, non-mandatory subject of collective bargaining.²

On May 16, 1960, District 50, United Mine Workers of America (henceforth District 50), was certified by the Labor Board as the collective bargaining agent for a unit composed of all truck drivers and laborers employed at the employer's plants in and around the County of Arlington, Virginia.³ On May 28th, Arlington and District 50 held their first negotiating session. Various contract proposals were considered. There was discussion of possible retaliation or pressure by the Building and Construction Trades Unions (henceforth BCTU) against contractors, such as Arlington, whose employees were represented by District 50 which was not a BCTU.⁴ The parties recognized that retaliation could assume one or more of three forms: (1) picketing at the job sites where such contractors were performing work; (2) requests or threats directed at general contractors subcontracting work to such contractors; or (3) refusal by general contractors to award work to employers whose employees were not represented by BCTU.

Both the Trial Examiner and the Board found that by August 31, 1960, substantial agreement had been reached on the terms of a collective bargaining contract. There was no resolution, however, of the potential problem of retaliation by the BCTU. It was further found that Arlington conditioned its acceptance of a collective bargaining agreement upon District 50's accepting an indemnity clause or some other provision against retaliation.⁵ District 50, on the other hand, rejected the indemnity clause and the alternative solutions that were offered.

The next bargaining session was not held until April 11, 1961, and the final meeting was on April 21st.⁶ At the April meetings Arlington proposed two alternative solutions to the potential problem of retaliation.⁷ However, counsel for Arlington testified that in the course of these discussions he "stated quite frankly that the indemnity provision was not a particularly satisfactory one insofar as the company was concerned, but it was the only avenue of relief that we could see."⁸ The Board found that just as the last session was concluding, District 50 indicated that it would advise Arlington "whether those solutions or others that might occur to them would be worth further discussions." 136 N.L.R.B. at 744. The unfair labor practice charges were then brought and the parties stipulated that:

"The sole issue upon which the Union and Respondent were unable to agree * * * and which precluded and to date continues to preclude a final agreement between the Union and Respondent was a solution which would protect Respondent in the event of possible retaliation and/or pressure brought by the building and construction trades unions * * *. The Union refused to agree to any offers made by Respondent which related to the problem * * *. From on or about August 31, 1960 to date, Respondent has taken and has adhered to the position that any final agreement between the parties was contingent on acceptance by the Union of some form of solution to the problem * * *." 136 N.L.R.B. at 752.

On this record, the Board accepted the Trial Examiner's finding that Arlington had insisted, to the point of impasse, upon an indemnity provision. The Trial Examiner, however, concluded that the proposal was a mandatory subject of collective bargaining, i. e., it related to "wages, hours, and other terms and conditions of employment," section 8(d), 29 U.S.C.A. § 158(d), in that a curtailment of work caused by BCTU action would affect the employment of Arlington's employees. He therefore further concluded that there was no violation by the employer of section 8(a) (5) and (1) and recommended dismissal of the complaint in its entirety. The Board concluded to the contrary that Arlington's indemnity proposal was not a "mandatory subject as to which it was entitled to bargain to an impasse." 136 N.L.R.B. at 747. Finding, as a result, that Arlington had engaged in unfair labor practices in violation of section 8(a) (5) and (1), the Board ordered Arlington to cease and desist therefrom and further ordered that:

"Upon the request of District 50, Arlington must sign a contract containing all the provisions agreed upon with District 50 on August 31, 1960, excluding the indemnity provision insisted upon by the Respondent. If no such demand is made, upon request of the aforementioned labor organization, Arlington must bargain collectively with it as the exclusive representative of the employees in the appropriate unit and if an understanding is reached, embody such understanding in a signed agreement." 136 N.L. R.B. at 749.

In opposition to the Board's petition for enforcement, Arlington argues that both the Trial Examiner and the Board erred in finding that it had insisted to an impasse upon an indemnity provision and that the Board further erred in concluding that the indemnity provision was not a mandatory subject for bargaining. We think that when the record is considered as a whole there is ample support for the finding of fact that an impasse had been reached as a result of Arlington's insistence on an indemnity provision. Arlington continued to bargain and to insist on the indemnity proposal, at least until a better solution could be found, well after it had been rejected by District 50. See Universal Camera Corp. v. N. L. R. B., 340 U.S. 474, 71 S.Ct. 456, 95 L.Ed. 456 (1951); N. L. R. B. v. Katz, 369 U.S. 736, 741-742, 82 S.Ct. 1107, 8 L.Ed.2d 230 (1962). We are also of the opinion that the Labor Board correctly concluded that the indemnity provision was a non-mandatory subject of bargaining. Arlington thus failed in its obligation to bargain in good faith, thereby committing unfair labor practices in violation of section 8 (a) (5) and (1) of the N.L.R.A. See N. L. R. B. v. Wooster Division of Borg-Warner Corp., 356 U.S. 342, 78 S.Ct. 718, 2 L.Ed.2d 823 (1958).

It is unnecessary to relate once again the legislative history of the provisions imposing the statutory obligation to bargain in good faith.⁹ Section 8(a) (5) provides that "it shall be an unfair labor practice for an employer — to refuse to bargain collectively with the representatives of his employees * * *." Section 8(d) provides that "to bargain collectively is the performance of the mutual obligation of the employer and the representative of the employees to * * confer in good faith with respect to wages, hours, and other terms and conditions of employment."¹⁰

In the Borg-Warner case, the Supreme Court held that:

"Read together sections 8(d) and 8(a) (5), these provisions establish the obligation of the employer and the representative of its employees to bargain with each other in good faith with respect to `wages, hours, and other terms and conditions of employment * * *.\' The duty is limited to those subjects, and within that area neither party is legally obligated to yield. citation omitted As to other matters, however, each party is free to bargain or not to bargain, and to agree or not to agree." 356 U.S. at 349, 78 S.Ct. at 722.

If a matter is within the language of section 8(d), it is deemed a mandatory subject of bargaining. Upon such a subject either party may insist on bargaining to an impasse. Subjects not within the language of section 8(d) are, on the other hand, deemed "voluntary." The parties are free to bargain on these voluntary subjects; but neither party may insist on them to impasse.¹¹ The good faith of the insisting party is no defense. See Borg-Warner, supra, 356 U.S. at 349, 78 S.Ct. at 722. The Court's theory in Borg-Warner was that insistence upon a non-mandatory subject "is, in substance, a refusal to bargain about the subjects that are within the scope of mandatory bargaining." 356 U.S. at 349, 78 S.Ct. at 723.

The employer in that case insisted, admittedly in good faith, upon inclusion in the agreement of a "ballot" clause, i. e., a provision "calling for a pre-strike secret vote of the employees (union and nonunion) as to the employer's last offer." 356 U.S. at 343, 78 S.Ct. at 720. But the Court held that the "ballot" clause "settled no term or condition of employment" and was therefore not a mandatory subject for bargaining. 356 U.S. at 350, 78 S.Ct. at 723. Answering the argument that the "ballot" clause was a partial "no-strike" clause, hence a mandatory subject of bargaining, the Court explained that:

"A `no-strike\' clause prohibits the employees from striking during the life of the contract. It regulates the relations between the employer and the employees. citation omitted The `ballot\' clause, on the other hand, deals only with relations between the employees and their unions. It substantially modifies the collective-bargaining system provided for in the statute by weakening the independence of the `representative\' chosen by the employees.

...