Phelps Dodge Corporation v. National Labor Relations Board National Labor Relations Board v. Phelps Dodge Corporation, s. 387

• Citation: 61 S.Ct. 845,133 A.L.R. 1217,85 L.Ed. 1271,313 U.S. 177
• Decision Date: 28 April 1941
• Docket Number: 641,Nos. 387,s. 387
• Parties: PHELPS DODGE CORPORATION v. NATIONAL LABOR RELATIONS BOARD. NATIONAL LABOR RELATIONS BOARD v. PHELPS DODGE CORPORATION
• Court: United States Supreme Court

313 U.S. 177

61 S.Ct. 845

85 L.Ed. 1271

PHELPS DODGE CORPORATION

v NATIONAL LABOR RELATIONS BOARD.

NATIONAL LABOR RELATIONS BOARD

v. PHELPS DODGE CORPORATION.

Nos. 387, 641.

Argued March 11, 1941.

Decided April 28, 1941.

[Syllabus from pages 177-179 intentionally omitted] Mr. Denison Kitchel, of Phoenix, Ariz., for Phelps Dodge Corporation.

[Argument of Counsel from pages 179-181 intentionally omitted] Messrs. Thomas E. Harris, of Washington, D.C., and Robert H. Jackson, Atty. Gen., for National Labor Relations Board.

Mr. Justice FRANKFURTER delivered the opinion of the Court.

The dominating question which this litigation brings here for the first time is whether an employer subject to the National Labor Relations Act may refuse to hire employees solely because of their affiliations with a labor union. Subsidiary questions grow out of this central issue relating to the means open to the Board to 'effectuate the policies of this Act (chapter)', if it finds such discrimination in hiring an 'unfair labor practice'. Other questions touching the remedial powers of the Board are also involved. We granted a petition by the Phelps Dodge Corporation and a cross-petition by the Board, 312 U.S. 669, 61 S.Ct. 447, 85 L.Ed. —-; 312 U.S. 669, 61 S.Ct. 450, 85 L.Ed. —-, to review a decision by the Circuit Court of Appeals for the Second Circuit, 113 F.2d 202, which enforced the order of the Board, 19 N.L.R.B., p. 547, with modifications. The main issue is intrinsically important and has stirred a conflict of decisions. National Labor Relations Board v. Waumbec Mills, 1 Cir., 114 F.2d 226.

The source of the controversy was a strike, begun on June 10, 1935, by the International Union of Mine, Mill and Smelter Workers at Phelps Dodge's Copper Queen Mine, Bisbee, Arizona. Picketing of the mine continued until August 24, 1935, when the strike terminated. During the strike, the National Labor Relations Act came into f rce. Act of July 5, 1935, 49 Stat. 449, 29 U.S.C. § 151 et seq., 29 U.S.C.A. § 151 et seq. The basis of the Board's conclusion that the Corporation had committed unfair labor practices in violation of § 8(3) of the Act was a finding, not challenged here, that a number of men had been refused employment because of their affiliations with the Union. Of these men, two, Curtis and Daugherty, had ceased to be in the Corporation's employ before the strike but sought employment after its close. The others, thirty-eight in number, were strikers. To 'effectuate the policies' of the Act, § 10(c), the Board order the Corporation to offer Curtis and Daugherty jobs and to make them whole for the loss of pay resulting from the refusal to hire them, and it ordered thirty-seven of the strikers reinstated with back pay, and the other striker made whole for loss in wages up to the time he became unemployable. Save for a modification presently to be discussed, the Circuit Court of Appeals enforced the order affecting the strikers but struck down the provisions relating to Curtis and Daugherty.

First. The denial of jobs to men because of union affiliations is an old and familiar aspect of American industrial relations. Therefore, in determining whether such discrimination legally survives the National Labor Relations Act, the history which led to the Act and the aims which infuse it give direction to our inquiry. Congress explicitly disclosed its purposes in declaring the policy which underlies the Act. Its ultimate concern, as well as the source of its power, was 'to eliminate the causes of certain substantial obstructions to the free flow of commerce'. This vital national purpose was to be accomplished 'by encouraging the practice and procedure of collective bargaining and by protecting the exercise by workers of full freedom of association'. § 1. Only thus could workers ensure themselves economic standards consonant with national well-being. Protection of the workers' right to self-organization does not curtail the appropriate sphere of managerial freedom; it furthers the wholesome conduct of business enterprise. 'The act', this Court has said, 'does not interfere with the normal exercise of the right of the employer to select its employees or to discharge them'. But 'under cover of that right', the employer may not 'intimidate or coerce its employees with respect to their self-organization and representation.' When 'employers freely recognize the right of their employees to their own organizations and their unrestricted right of representation there will be much less occasion for controversy in respect to the free and appropriate exercise of the right of selection and discharge'. National Labor Relations Board v. Jones & Laughlin Steel Corp., 301 U.S. 1, 45, 46, 57 S.Ct. 615, 628, 81 L.Ed. 893, 108 A.L.R. 1352. This is so because of the nature of modern industrialism. Labor unions were organized 'out of the necessities of the situation. * * * Union was essential to give laborers opportunity to deal on equality with their employer'. Such was the view, on behalf of the Court, of Chief Justice Taft, American Steel Foundries v. Tri-City Central Trades Council, 257 U.S. 184, 209, 42 S.Ct. 72, 78, 66 L.Ed. 189, 27 A.L.R. 360, after his unique practical experience with the causes of industrial unrest as co-chairman of the National War Labor Board. And so the present Act, codifying this long history, leaves the adjustment of industrial relations to the free play of economic forces but seeks to assure that the play of those forces be truly free.

It is no longer disputed that workers cannot be dismissed from employment because of their union affiliations. Is the national interest in industrial peace less affected by discrimination against union activity when men are hired? The contrary is overwhelmingly attested by the long history of industrial conflicts, the diagnosis of their causes by official investigations, the conviction of public men, industrialists and scholars. n¹ Because of the Pullman strike, Congress in the Erdman Act of 1898 prohibited inroads upon the workingman's right of association by discriminatory practices at the point of hiring.² Kindred legislation has been put on the statute books of more than half the states.³ And during the late war the National War Labor Board concluded that discrimination against union men at the time of hiring violated its declared policy that 'The right of workers to organize in trade-unions and to bargain collectively * * * shall not be denied, abridged, or interfered with by the employers in any manner whatsoever'.⁴ Such a policy is an inevitable corollary of the principle of freedom of organization. Discrimination against union labor in the hiring of men is a dam to self organization at the source of supply. The effect of such discrimination is not confined to the actual denial of employment; it inevitably operates against the whole idea of the legitimacy of organization. In a word, it undermines the principle which, as we have seen, is recognized as basic to the attainment of industrial peace.

These are commonplaces in the history of American industrial relations. But precisely for that reason they must be kept in the forefront in ascertaining the meaning of a major enactment dealing with these relations. To be sure, in outlawing unfair labor practices, Congress did not leave the matter at large. The practices condemned 'are strictly limited to those enumerated in section 8', S.Rep. No. 573, 74th Cong., 1st Sess., p. 8. Section 8(3) is the foundation of the Board's determination that in refusing employment to the two men because of their union affiliations Phelps Dodge violated the Act. And so we turn to its provisions that 'It shall be an unfair labor practice for an employer * * * By discrimination in regard to hire or tenure of employment or any term or condition of employment to encourage or discourage membership in any labor organization'.

Unlike mathematical symbols, the phrasing of such social legislation as this seldom attains more than approximate precision of definition. That is why all relevant aids are summoned to determine meaning. Of compelling consideration is the fact that words acquire scope and function from the history of events which they summarize. We have seen the close link between a bar to employment because of union affiliation and the opportunities of labor organizations to exist and to prosper. Such an embargo against employment of union labor was notoriously one of the chief obstructions to collective bargaining through self-organization. Indisputably the removal of such obstructions was the driving force behind the enactment of the National Labor Relations Act. The prohibition against 'discrimination in regard to hire' must be applied as a means towards the accomplishment of the main object of the legislation. We are asked to read 'hire' as meaning the wages paid to an employee so as to make the statute merely forbid discrimination in one of the terms of men who have secured employment. So to read the statute would do violence to a spontaneous textual reading of § 8(3) in that 'hire' would serve no function because, in the sense which is urged upon us, it is included in the prohibition against 'discrimination in regard to * * * any term or condition of employment'. Contemporaneous legislative history,⁵ and, above all, the background of industrial experience forbid such textual mutilation.

The natural construction which the text, the legislative setting and the function of the statute command, does not impose an obligation on the employer to favor union members in hiring employees. He is as free to hire as he is to discharge employees. The statute does not touch 'the normal exercise of the right of the employer to select its employees or to discharge them'. It is directed solely against the abuse of that right by interfering with the countervailing right of self-organization.

We have already recognized the power of Congress to deny an employer...