NLRB v. Zoe Chemical Co.
| Citation | 406 F.2d 574 |
| Decision Date | 13 January 1969 |
| Docket Number | Docket 31989.,No. 29,29 |
| Parties | NATIONAL LABOR RELATIONS BOARD, Petitioner, v. ZOE CHEMICAL CO., Inc., and Local 803, Allied Aluminum and Industrial Union, Respondents. |
| Court | United States Courts of Appeals. United States Court of Appeals (2nd Circuit) |
William J. Avrutis, Atty., NLRB (Arnold Ordman, Gen. Counsel, Dominick L. Manoli, Associate Gen. Counsel, Marcel Mallet-Prevost, Asst. Gen. Counsel, Allison W. Brown, Jr., Atty., Washington, D. C., on the brief), for petitioner.
Charles R. Katz, New York City (Katz & Wolchok, New York City, on the brief), for respondent Zoe Chemical Co., Inc.
Before FRIENDLY, ANDERSON and FEINBERG, Circuit Judges.
Over five years ago, respondent Zoe Chemical Co., Inc. was caught in the cross-fire of a struggle between two unions, one of which — Local 803, Allied Aluminum and Industrial Union — was then midway through a three-year collective bargaining contract with Zoe. At Local 803's request and in accordance with a judicially confirmed arbitration award, Zoe discharged twelve employees on October 4, 1963. Since then, it has found itself involved in a bitter legal battle before the National Labor Relations Board, culminating in a back-pay order which may subject Zoe to heavy liability. Before us now is the Board's petition to enforce that order; for reasons given below, we decline to do so against Zoe.
Although unaware of it at the time, Zoe's troubles started in March 1962, when it signed a collective bargaining agreement — apparently its first — with Local 803. The contract contained a standard union security clause, requiring the approximately 25 to 30 production employees "as a condition of employment" to "become and remain members of the Union in good standing on the 31st day after date of employment." After achieving status as bargaining representative, however, Local 803 ignored the employees. For over a year, although dues were deducted from the wages of those who had signed check-off authorizations during Local 803's organization drive, the union security provisions were not enforced, no Local 803 representative came to the plant, there was no union steward, and the shop was not serviced by the Local. Understandably disenchanted by this treatment, some of the employees contacted another union, Local 8-149, Oil, Chemical and Atomic Workers International Union, AFL-CIO (Local 149); internecine warfare broke out almost immediately.
In June 1963, Local 149 filed a petition with the Board for a representation election, claiming that a majority of the unit had signed Local 149 authorization cards. However, the Regional Director dismissed the petition because a valid collective bargaining agreement with Local 803 was then in effect. Meanwhile, Local 803 stirred itself into action. Its president, Bernard Kalisky, visited the plant on June 21, while Local 149's petition was still pending, and explained to the employees that Local 803's contract barred them from bringing in another union. He also apologized for the union's neglect and promised to correct the situation in the future, stating that the union official who should have serviced the plant would be fired.1 Kalisky also read the union security clause to the employees and warned them that they had to join Local 803 or he would have to request their discharge; he stated that past dues would be forgiven and the employees would be granted another 30 days to join up.
Thereafter, in June and in July, Kalisky and sometimes other union agents frequently returned to the plant to repeat the warning. During this time, Kalisky stated that the employees would also have to sign union membership cards in order to avoid discharge. However, prior to August 30, none of the subsequently discharged employees tendered either dues or initiation fees. Meanwhile, on July 15, Local 149 filed charges with the Board because the company refused to recognize it as a majority representative. The charge was withdrawn in August. On July 18, an employee filed a union de-authorization petition with the Board, seeking to nullify the union security clause and Local 803's contract. So far as appears from the record, this petition is still pending five years later.
On July 24, Kalisky wrote Zoe recounting what had transpired at the June 21 meeting. The letter also informed Zoe that although Kalisky had given the employees additional time to comply with the union shop provision, all except six, whom he named, had failed to do so. Kalisky therefore requested the company to discharge the noncomplying employees immediately. During this period, Local 149's organizer was pressuring Zoe not to enforce the union security clause, with the possibility of a strike implicit. Zoe posted Local 803's letter where all could see it but refused to discharge the employees. On August 5, Local 803 commenced arbitration proceedings under its contract to require Zoe to enforce the union security clause.2 All notices regarding that proceeding were posted on the employee bulletin board. The hearing was attended by representatives of Zoe and Local 803, but neither the employees nor Local 149, although otherwise represented by counsel, attended or intervened. In the arbitration proceeding, Zoe resisted Local 803's demand, pointing out that discharge of "practically the entire unit * * * at its then busy season would constitute economic hardship." On August 26, arbitrator Jerome J. Lande, former general counsel of the New York State Board of Mediation, ruled that the union security agreement was clear and directed Zoe to discharge those of its employees in the unit "who have failed to join the union on or before Sept. 3." Upon receipt of the award, Zoe posted it on the bulletin board, and in the next few days Zoe's president explained its impact to the employees. Local 803 sought confirmation of the award in the Supreme Court of the State of New York and obtained an order of that court, dated September 30, which confirmed the arbitrator's award. On October 4, 1963, Zoe complied with the award.3
Within a week or two, the discharged employees filed charges with the Board, claiming that they had properly tendered dues and initiation fees, a factual issue to be discussed below. In February 1964, the Board's General Counsel issued a consolidated complaint against both Local 803 and Zoe, charging the former with violating sections 8(b) (1) (A) and 8(b) (2) of the National Labor Relations Act, 29 U.S.C. §§ 158(b) (1) (A), (2) and the latter with violating sections 8(a) (1) and 8(a) (3), 29 U.S.C. §§ 158(a) (1), (3). The gist of these charges was that Local 803 had unlawfully enforced its union shop contract with Zoe, by rejecting timely tendered of dues and fees and by causing Zoe to discharge the employees because of rival union activities and that Zoe had wrongfully gone along with this improper scheme.
There then ensued a lengthy legal struggle before the Board, which required two separate decisions by the hearing examiner, two appeals to the Board and decisions by it, 13 days of hearings and almost 2,000 pages of transcript, before culminating in a Board order in September 1966, almost three years later. The chief issues litigated involved the alleged attempt of the discharged employees to make a proper tender of dues and initiation fees before their discharge. The employees maintained that they offered to pay dues on August 30, 1963, but that Kalisky insisted that they also sign union membership cards,4 and when they replied that they were not required to do this,5 he rejected their tender. Local 803 sharply disputed this testimony, but in his first decision the trial examiner did not decide the issue whether dues had actually been tendered. His theory was that the employees were also required to tender the $25 initiation fee with the $5 dues, "to test the Union's willingness to accept them in fulfillment" of the contract obligations; since that additional tender was not made, the discharges were proper. Accordingly, in a thorough and well-reasoned opinion, he recommended that the complaint against Local 803 and Zoe be dismissed. However, the Board did not accept this view, holding, as the examiner properly construed it, that if the charging parties were believed, an additional tender of initiation fees would have been futile "since the Union had demanded more than it was legally entitled to, namely, signed authorization cards." Accordingly, the Board directed the examiner to resolve the factual issues on the tender.
The examiner thereupon reopened the record for additional evidence and made further findings; the most significant were that tender of dues was made to Kalisky at noon on August 30, 1963, and that Kalisky rejected the tender because the employees refused to sign membership cards. The examiner therefore concluded, under what he regarded as "the law of the case set down in the Board's" remand, that Local 803 had caused the discharges for reasons other than failure to tender dues and initiation fees and had violated the Act. The examiner went on to hold that Zoe did not have "reasonable grounds for believing that Local 803's discharge request was predicated on the employees' failure to pay dues," and that, therefore, Zoe also violated the Act when it discharged the employees. The examiner's recommended order required Zoe to offer reinstatement and held Zoe and Local 803 jointly and severally liable for backpay until April 6, 1964, when the Local notified Zoe that it had no objection to reemployment of the employees; after that date, only Zoe would be liable for backpay. These findings were adopted by the Board, except that for the period prior to April 6, 1964, Local 803 was "primarily liable" and Zoe was liable only "secondarily." Even this might be scant consolation for Zoe, since Local 803 is apparently no longer in existence.6
This summary has skimmed over a number of other factual issues decided...
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