NLRB v. King Radio Corporation

• Decision Date: 17 November 1969
• Docket Number: No. 119-68.,119-68.
• Citation: 416 F.2d 569
• Parties: NATIONAL LABOR RELATIONS BOARD, Petitioner, v. KING RADIO CORPORATION, Inc., Respondent.
• Court: U.S. Court of Appeals — Tenth Circuit

416 F.2d 569 (1969)

NATIONAL LABOR RELATIONS BOARD, Petitioner, v. KING RADIO CORPORATION, Inc., Respondent.

No. 119-68.

United States Court of Appeals Tenth Circuit.

September 17, 1969.

Rehearing Denied November 17, 1969.

Paul J. Spielberg, Attorney, N.L.R.B. (Arnold Ordman, General Counsel, Dominick L. Manoli, Associate Gen. Counsel, Marcel Mallet-Prevost, Asst. Gen. Counsel and Peter Kinzler, Attorney, N.L.R.B., Washington, D. C., on the brief), for petitioner.

William G. Haynes, Topeka, Kan., (Lillard, Eidson, Lewis & Porter, Topeka, Kan., on the brief) for respondent.

Before MURRAH, Chief Judge, TUTTLE^* and BREITENSTEIN, Circuit Judges.

MURRAH, Chief Judge.

This is a proceeding to enforce a Decision and Order of the National Labor Relations Board finding respondent guilty of violating Section 8(a) (1) by: its no talking and warning notice rule; threatening its striking employees with discharge, permanent replacement and loss of economic benefits; and violating Section 8(a) (5) and (1) by: unilateral wage changes; unilaterally contracting out bargaining unit work; and failing to bargain in good faith.

Affirmatively, respondent was ordered to: (1) Abrogate the wage changes; (2) Bargain in good faith; (3) Upon request, reinstate all striking employees to available positions without prejudice to their wage rates, seniority and other rights and privileges. And if enough positions are not available, place all striking employees on a preferential hiring list.

When this case was here in 398 F.2d 14, to enforce an order of the Board, we sustained the Board's finding to the effect that the no talking and warning notice rule was a discriminatorily inspired violation of Section 8(a) (1) and (5). The no talking and warning notice rule involved here is but a continuation of the rule formerly condemned both by the Board and this court. We again sustain the Finding and Order of the Board based upon the condemned practice.

This brings us to the unilateral wage changes in the bargaining unit found to be a Section 8(a) (5) and (1) violation. Respondent suggests that a part of the wage change was required by the federally established minimum wage and prompted a good faith wage increase for all bargaining unit employees.

This argument seems plausible on its face. But the Board thought, not without justification, that the wage changes instituted as they were during negotiations on that very subject, were suspect of an 8(a) (5) violation. And when considered with the fact that the wage increases were inequitably distributed among the employees in the bargaining unit without regard to merit, a clear violation was shown.

Unilateral changes in wages and working conditions during negotiations concerning the same subject matter are clear manifestations of a lack of good faith bargaining and violate Section 8(a) (5). And this is so, even though the employer may have desired to reach an overall agreement. N.L.R.B. v. Katz, 369 U.S. 736, 82 S.Ct. 1107, 8 L.Ed.2d 230; N.L. R.B. v. United Nuclear Corporation, 381 F.2d 972 (10th Cir.). Unilateral action in matters of this kind can be justified only after the parties have bargained in fact to an impasse. N.L.R.B. v. United Nuclear Corporation, supra.

The most then that can be said for respondent's position is that the unilateral wage changes were instituted after the point of impasse had been reached. Respondent insists that they were so instituted. The Board found to the contrary. And we quite agree. The wage changes were instituted during purported negotiations concerning that very subject. And if respondent was not bargaining in fact, it was not bargaining in good faith. And the violation is clearly manifest.

The Board found that respondent contracted bargaining unit work to a third party from April to June, 1967, without notice to or bargaining with the union concerning the work in violation of Section 8(a) (5) and (1). The Order is apparently based on the hypothesis that unilateral contracting out of any work is an 8(a) (5) violation. We cannot accept the hypothesis.

It is established that the replacement of employees in the existing bargaining unit with those of an independent contractor to do the same work under similar conditions is a mandatory subject of collective bargaining under Section 8(d). Fibreboard Paper Products Corp. v. N.L.R.B., 379 U.S. 203, 85 S.Ct. 398, 13 L.Ed.2d 233. Before Fibreboard but consistently with its rationale, we sustained a Board order based upon a finding that the subcontracting work did effect a displacement of the employees of the bargaining unit in violation of 8(a) (5). N.L.R.B. v. Brown-Dunkin, 287 F.2d 17 (10th Cir.). But we recognized that not every unilateral contracting out is an unfair labor practice per se. And subsequent cases have prudently balanced the essential managerial prerogatives against the collective bargaining rights of employees by requiring a showing that the unilateral contracting out of work in some way adversely affected the hire and tenure of the bargaining unit employees. District 50, United Mine Workers of America, Local 13942 v. N.L.R.B., 358 F.2d 234 (4th Cir.); Puerto Rico Telephone Company v. N.L. R.B., 359 F.2d 983 (1st Cir.).

Applying this test, we fail to see how the contracting out of the work in our case in any manner adversely affected the hire and tenure rights of the employees. In the first place, the contracting out involved only a small amount of labor (124 work hours) and occurred while the employees were on strike. The contracting out was of a temporary nature and in no way changed repondent's employment structure. Indeed, the Board did not find that the contracting out adversely affected the hire and tenure of the bargaining unit employees. Absent a showing of significant adverse impact on the bargaining unit, we must decline to enforce the Order of the Board in this respect.

In this connection, the Board also found that respondent violated Section 8 (a) (5) and (1) by failing to inform the union of its intention to contract out the work in question. This would be so if the contracting out did in fact adversely affect the hire and tenure of bargaining unit employees. But since, in our view, it did not, the employer did not violate the Act by failing to inform. Respondent proceeded at its peril but committed no offense. Cf. N.L.R.B. v. Brown-Dunkin, supra.

The Board found that the strike was an unfair labor practice strike from its inception and has been prolonged by the unfair labor practices of respondent. And we sustain that...