NLRB v. WL Rives Company

• Decision Date: 06 June 1961
• Docket Number: No. 18273.,18273.
• Citation: 288 F.2d 511
• Parties: NATIONAL LABOR RELATIONS BOARD, Petitioner, v. W. L. RIVES COMPANY, Respondent.
• Court: U.S. Court of Appeals — Fifth Circuit

288 F.2d 511 (1961)

NATIONAL LABOR RELATIONS BOARD, Petitioner, v. W. L. RIVES COMPANY, Respondent.

No. 18273.

United States Court of Appeals Fifth Circuit.

March 15, 1961.

Rehearing Denied June 6, 1961.

Earle W. Putnam, Atty., N. L. R. B., Dominick Manoli, Associate Gen. Counsel, N. L. R. B., Marcel Mallet-Prevost, Asst. Gen. Counsel, N. L. R. B., Stuart Rothman, Gen. Counsel, Melvin J. Welles, Attys., N. L. R. B., Washington, D. C., for petitioner.

Albert S. C. Millar, Jr., Hamilton & Bowden, Jacksonville, Fla., for respondent.

Before JONES and BROWN, Circuit Judges, and CARSWELL, District Judge.

JOHN R. BROWN, Circuit Judge.

The question here is whether an employer "caught `between the devil and the deep blue,'" N. L. R. B. v. Radio and Television Broadcast Engineers, 1961, 364 U.S. 573, 81 S.Ct. 330, 332, 5 L.Ed.2d 302, through a jurisdictional controversy was guilty of unfair labor practice, refusal to bargain and discriminatory refusal to rehire strikers under § 8(a) (1, 3, 5). 29 U.S.C.A. § 158(a) (1, 3, 5), when it farmed out the disputed work to a subcontractor. The Board so held. We reverse.

The hapless, helpless victim of this internecine struggle who now finds itself faced by a third protagonist through the Board's order was the Employer, W. L. Rives Company. Rives manufactures and fabricates to order corrosion resistant pipe and fittings, principally of stainless steel for installation in industrial machinery. When the product is finally a part of the industrial machine, it will have gone through three principal phases: (1) the manufacture or fabricating of the parts (includes pipe, tubing, elbows, T's, and S's); (2) fitting or assembly of these parts together in a shop; and (3) installation of this "fitted" equipment into the machine at the final job-site. Rives did not perform step (3). It regularly did steps (1) and (2).

While Rives did not ever perform step (3), it was at this phase that all of the trouble began. This was essentially in the field of the construction trades. In this area the dominant union was United Association of Pipe Fitters,¹ hence the frequent reference to the "UA label."

This Union included the separate crafts which customarily performed step (2) operations and others which did step (3). It was not, however, concerned with step (1) the initial manufacture or fabrication. But throughout a major segment of the construction industry, it had imposed an absolute requirement that its members would not perform the step (3) final installation unless the step (2) shop assembly work had also been performed by its members. This requirement could only be surmounted if the union would "accept" or give its approval to material not bearing the UA label.

The result was that a concern doing (1) and (2) was at the mercy of UA. Rives had long experienced this fact of life. In soliciting work among contractors and subcontractors, Rives knew that it could not get a bid unless it could give assurances that pipe fabricated and fitted by it (step (1) and (2) work) would be given clearance by UA. Prior to the time its shop became unionized in November 1957, Rives presumably had not had too much difficulty in obtaining this clearance. This was obtained through Bryan, the Jacksonville, Florida representative of UA. Occasionally Bryan had to go through the international office at Washington. Whatever steps Bryan, or Bryan and Rives together, had to take, the clearance was routinely effectuated by Bryan notifying the UA Local at the job site that the Rives' work was "fair." From all that appears this went along smoothly with the best of cordial relations. There was not then, nor was there ever, any hostility by Rives to UA or to any other union or to trade unionism generally.

Nor did the introduction of a new union into the picture alter things. After a Board-conducted election, Sheet Metal Workers² was certified in November 1957 as the bargaining representative of Rives' employees engaged in operations (1) and (2). But the representative of Sheet Metal Workers knew of the imperative necessity that Rives get UA clearance if it were to bid on many jobs opening up. Following the certification extended negotiations commenced looking toward a collective bargaining agreement. During that time Rives with the knowledge, and on some occasions, active assistance of representatives of Sheet Metal Workers, consulted with Bryan to obtain such clearance for specific proposed jobs. And during all of these contract negotiations — as to which there is not even the slightest whisper of dilatory feet-dragging, shadow-boxing, or dissimulation of any kind — it was recognized by both sides that this was the real problem. Rives naturally took the position that Sheet Metal Workers had to assure that work performed by its members could be sold and delivered as "fair." Sheet Metal Workers, on the other hand, recognizing full well the Employer's predicament took the practical view that it could not guarantee what other workers would do, even though they were all trade unionists and now part of one big family (AFL-CIO).³

While all of this was going on in the best of spirits, the Bowater job opened up for a substantial subcontract on the huge plant being built in Tennessee for the Bowater Paper interests. As usual, there was the question of UA clearance. Sheet Metal Workers could then give no assurance but it cooperated actively with Rives as discussions were carried on with Bryan. Bryan advised that UA would clear the work even though step (2) would be done by members of Sheet Metal Workers. On the strength of this, Rives submitted its bid as a subcontractor to Jamison who had the contract with Bowater. After Bowater and Jamison's acceptance of the bid,⁴ Rives purchased materials costing approximately $90,000 and became obligated for a $7,000 nonperformance penalty.

Up to this point no one was angry. Everyone was presumably happy. Rives had a new contract. His own employees, members of Sheet Metal Workers, had the prospect of continuous and profitable work. Bryan and UA were likewise content. Employer and employees alike were busy with work and the contract negotiations continued without acrimony.

Then came the blow. Bryan suddenly advised that he had been overruled by "Washington." The UA clearance was withdrawn. Now all faced a crisis. Under great tension every appeal was made by Rives by and through Bryan to highly placed international officers of both Unions. Intercession of congressional and political representatives was likewise pursued. Sheet Metal Workers, vitally interested, was aware of all of this. But these efforts were unavailing. Clearance from UA could not be obtained. What was Rives to do? Apprehending that these appeals would be unfruitful, Rives had discussed with Sheet Metal Workers representatives the possibility that the work would have to be subcontracted to a UA shop. By meetings with employees and their shop committees, all were conscious of the urgency. After conferences among Bowater, Jamison and Rives, it was determined about June 14 that subcontracting was the course to take. Before it was done, Rives announced to a meeting of all of its employees the fact that a subcontract was being made for all of the step (2) fitting work for the Bowater contract. This was to be accomplished under a contract with Jamison on a cost-plus-fixed-fee basis. A portion of Rives' plant was marked off for Jamison's operations. The step (1) parts fabricated by Rives were turned over by Rives' employees to Jamison's men. Jamison's men then performed the step (2) fittings.

At the time this was done and the announcement made to employees of Rives, they were assured that this would not affect anyone's job and pay or work would not be reduced. In the changeover there was some slight confusion and some of Rives' employees were engaged in tasks not ordinarily performed, although of a type occasionally done by them. Their regular, full pay continued without any reduction.

Despite these assurances the Board found that the employees were restive over the subcontracting and this led them first to file an unfair labor practice complaint on June 27 and on July 1 the men went out on a strike.⁵ Collective bargaining negotiations continued during the strike. On September 25 the contract was agreed on and the strike ended. All strikers were rehired except six. Rives treated them as economic strikers who had been replaced. The Board held them to be unfair labor practice strikers and ordered their reinstatement. As we pointed out above, note 3, supra, in the contract Sheet Metal Workers guaranteed acceptance of the work⁶ and thereby for itself recognized that if Sheet Metal Workers failed in this undertaking Rives, as the Employer, was free to subcontract out such work in the future or hire UA workers to perform the work.

As we view it, and as did the Board, the whole thing turns finally on whether the making of the subcontract with Jamison was permissible. If it was, the strike was an economic one thus affording no right to automatic reinstatement under § 8(a) (3). Nor would it amount to a § 8(a) (1) interference. Such a conclusion would not automatically erase the Board's further holding that the circumstances of making an otherwise permissible subcontract were such as to constitute a § 8(a) (5) refusal to bargain.

As to this conclusion of refusal to bargain, we would say at the outset there is simply no evidence to warrant that conclusion. The likelihood of subcontract as the only way out was discussed and recognized on several occasions, both in the bargaining sessions and in the crisis precipitated by the despotic withdrawal of UA clearance on the Bowater job. Indeed, there was no violent opposition to the general notion of subcontracts. What concerned Sheet Metal Workers representatives was the making of an agreeable contract. It is true that no impasse, as that term is usually thought of had yet been reached...