NLRB v. Joint Council of Teamsters No. 38

• Decision Date: 29 October 1964
• Docket Number: No. 18952.,18952.
• Citation: 338 F.2d 23
• Parties: NATIONAL LABOR RELATIONS BOARD, Petitioner, v. JOINT COUNCIL OF TEAMSTERS NO. 38, Teamsters Union, Local No. 87, et al., and Arden Farms Co., et al., Respondents.
• Court: U.S. Court of Appeals — Ninth Circuit

338 F.2d 23 (1964)

NATIONAL LABOR RELATIONS BOARD, Petitioner, v. JOINT COUNCIL OF TEAMSTERS NO. 38, Teamsters Union, Local No. 87, et al., and Arden Farms Co., et al., Respondents.

No. 18952.

United States Court of Appeals Ninth Circuit.

October 29, 1964.

COPYRIGHT MATERIAL OMITTED

Arnold Ordman, Gen. Counsel, Dominick L. Manoli, Assoc. Gen. Counsel, Marcel Mallet-Prevost, Asst. Gen. Counsel, Melvin J. Welles, Gary Green, Attys., N.L.R.B., Washington, D. C., for petitioner.

Robert LeProhn, Stewart Weinberg, LeProhn & LeProhn, San Francisco, Cal., for respondents, Joint Council of Teamsters No. 38, etc.

Edward H. Moore, St. Sure, Moore, Corbett, Oakland, Cal., for certain employer respondents.

Before ORR, HAMLEY, and BROWNING, Circuit Judges.

BROWNING, Circuit Judge.

The National Labor Relations Board petitions for enforcement of its order directed against certain provisions of respondents' collective bargaining agreement, which the Board held¹ to be in violation of section 8(e) of the National Labor Relations Act.²

I

The first of the challenged provisions, article 5, section 1, provides that each respondent employer "agrees to refrain from doing business with any person engaged in the distribution of fluid milk or ice cream products who has not executed this agreement."

Respondents contend that the agreement embodied in section 1 of article 5 is not forbidden by the language of section 8(e), and, moreover, that it is not the kind of agreement which Congress intended to prohibit.

A.

Respondents' argument based upon the statutory language begins with a division of section 8(e) of the Act into two parts — the first prohibiting an agreement by an employer to "cease or refrain from handling, using, selling, transporting or otherwise dealing in any of the products of any other employer"; the second prohibiting an agreement by an employer to "cease doing business with any other person."

1. Respondents contend that the first of these prohibitory clauses is inapplicable to section 1 of article 5 for two reasons. First, they assert that the phrase "any person" in this provision of their contract refers to individual truckers who have no employees, and argue that an agreement to refrain from doing business with such individuals is not an agreement to refrain from dealing in the products "of any other employer." Second, they assert that the milk products involved are those of the respondent employer, and argue that there is thus no agreement to refuse to handle the products "of any other employer."

As to respondents' first contention, the record before the Board contained uncontradicted testimony that at least six to eight independent distributors doing business within the area affected by the collective bargaining agreement were in fact employers. The Board could properly conclude that the unqualified language of section 1 of article 5 applied to these distributors.

As to respondents' second contention, we think the rationale of National Labor Relations Board v. Servette, Inc., 377 U.S. 46, 84 S.Ct. 1098, 12 L.Ed. 2d 121 (1964), requires that the term "products of any other employer" in section 8(e) be read to include services furnished by an employer performing a distribution function.³ This conclusion is implicit in National Labor Relations Board v. Milk Wagon Drivers' Union Local 753, 335 F.2d 326 (7th Cir. 1964). See also Bakery Wagon Drivers and Salesmen Local Union No. 484 v. National Labor Relations Board, 116 U.S.App. D.C. 87, 321 F.2d 353 (D.C.Cir. 1963); Highway Truck Drivers & Helpers Local 107 etc. v. National Labor Relations Board, 112 U.S.App.D.C. 312, 302 F.2d 897 (1962).

As the Supreme Court pointed out in Servette, "a primary target of the 1959 amendments was the secondary boycotts conducted by the Teamsters Union, which ordinarily represents employees not of manufacturers, but of motor carriers." 377 U.S. at 55, 84 S.Ct. at 1104. Section 8(e) would fall short of achieving its purpose if the Teamsters Union and a trucking company could agree with impunity that the latter would not interchange traffic with a non-union trucking company, on the theory that the latter's transportation service was not a "product." Both Congressman Landrum and Congressman Griffin pointed to this type of agreement as illustrative of the wrong which Congress sought to remedy.⁴

As noted in Servette, such terms as "produced" and "production" are commonly used in legislation to apply to the distribution of goods. 377 U.S. at 55-56, 84 S.Ct. 1098. The legislative history of section 8(e) is replete with references indicating that Congress meant to include all forms of economically productive effort within the term "product."⁵ Moreover, the language of the second clause of section 8(e) plainly includes services, and there is nothing in the legislative history to indicate that Congress intended the application of the two clauses to differ in this respect.

2. Even if the first clause of section 8(e) were inapplicable, section 1 of article 5 of respondents' contract would fall within the language of the second prohibitory clause. Respondents' contention to the contrary is premised upon the fact that the second clause of section 8(e) applies only to agreements "to cease" doing business, whereas section 1 of article 5 is an agreement "to refrain" from doing business. Respondents offered evidence that the parties intended this contract provision to apply only to future arrangements, and that no respondent-employer had been required to terminate existing arrangements with distributors.

Some commentators have accepted the distinction which respondents draw,⁶ but most have rejected it.⁷ We are satisfied that the latter position is correct. The legislative history offers compelling evidence that Congress intended no difference in meaning in its use of "cease" and "cease and refrain" in the two prohibitory clauses of section 8(e).

Section 8(e) originated in a floor proposal, offered by Senator Gore, prohibiting agreements by unions and common carriers by which the latter agreed to "cease or refrain from handling or transporting any of the products of any other employer." Senator McClellan expressed concern that this language might be circumvented by an agreement to refuse to do business with another employer. Such an agreement would effectively stop the transportation of that employer's products, but would not fall literally within the description of an agreement to stop "handling or transporting" those products. To meet this problem, Senator McClellan suggested the addition of the language, "or to cease doing business." The amendment was accepted.⁸ Thus, the second prohibitory clause of section 8(e) was added for the sole purpose of avoiding a possible subject-matter limitation upon the agreements prohibited. Nothing in the legislative materials suggests that either House intended to limit the reach of this broadened, "catch-all" clause to agreements affecting existing business relationships.

"Cease" and "refrain" are commonly treated as synonymous,⁹ and were so used throughout the legislative proceedings. When Senator McClellan suggested the addition of the second clause, Senator Gore twice restated the section as it would read after amendment, and each time used "cease" and "refrain" in both clauses.¹⁰ The word "refrain" was omitted from the second clause in the final printing of the Senate bill. This version was copied in later bills without comment on the omission, and, it may be fairly assumed, with no intention that the omission be accorded greater significance in the application of section 8(e) by the courts than it was accorded during the consideration of the section by Congress.¹¹

We conclude that section 1 of article 5 falls within the language of section 8(e) of the Act.

B.

Respondents' legislative-purpose argument runs as follows: Section 8(e) was intended to reach only agreements of the "hot cargo" variety, which bind a neutral employer to boycott another employer with whom the union has its real dispute. Such agreements are banned because they bring unfair pressure upon the employer having a dispute with the union, involve neutral employers and employees in labor disputes not their own, and spread labor disputes from their primary situs. Section 1 of article 5 is not such an agreement, but rather prohibits subcontracting of bargaining unit work to outside employers to protect the job opportunities of the employees of the signatory employers. Since its purpose is to provide job protection, and not to bring pressure to bear upon other employers to affect their labor policies, the contract provision is primary in nature and does not fall within section 8(e)'s ban on secondary boycotts.

We agree that section 8(e) is not to be applied literally to prohibit all union-employer agreements limiting subcontracting. More particularly, an agreement which restricts subcontracting to protect the job opportunities of the employees of a signatory employer, and not to apply secondary pressure upon third-party employers, may be beyond the purpose of section 8(e) and excepted from its proscription.¹²

But section 1 of article 5 of respondents' contract does not fall within this exception. Subcontracting is permitted if the third party has signed a union contract, prohibited if he has not. Whether the pressure of a boycott by a signatory employer will be applied to a third party depends entirely upon the latter's relationship with the union. The thrust of this boycott agreement is secondary, and the provision is therefore contrary to the purpose as well as the letter of section 8(e). Meat and Highway Drivers Local Union No. 710 v. National Labor Relations Board, 335 F.2d 709, 717 (D.C.Cir. 1964); Truck Drivers Union Local No. 413 etc. v. National Labor Relations Board, 334 F.2d 539, 548 (D.C. Cir. 1964); Dist. No. 9, Int'l Ass'n of Machinists etc. v. National Labor Relations Board, 114 U.S.App.D.C. 287, 315 F.2d 33,...