REA Express, Inc. v. BROTHERHOOD OF RAILWAY, AIRLINE, ETC.

• Citation: 459 F.2d 226
• Decision Date: 01 May 1972
• Docket Number: No. 71-2212.,71-2212.
• Parties: REA EXPRESS, INC., Plaintiff-Appellant, v. BROTHERHOOD OF RAILWAY, AIRLINE AND STEAMSHIP CLERKS, FREIGHT HANDLERS, EXPRESS AND STATION EMPLOYEES, et al., Defendants-Appellees.
• Court: United States Courts of Appeals. United States Court of Appeals (5th Circuit)

459 F.2d 226 (1972)

REA EXPRESS, INC., Plaintiff-Appellant, v. BROTHERHOOD OF RAILWAY, AIRLINE AND STEAMSHIP CLERKS, FREIGHT HANDLERS, EXPRESS AND STATION EMPLOYEES, et al., Defendants-Appellees.

No. 71-2212.

United States Court of Appeals, Fifth Circuit.

May 1, 1972.

Charles Kelso, Atlanta, Ga., Arthur M. Wisehart, New York City, for plaintiff-appellant; Peter G. Wolfe, New York City, Fisher & Phillips, Atlanta, Ga., of counsel.

James L. Highsaw, Washington, D. C., David J. Fleming, New York City, Joseph Jacobs, Atlanta, Ga., William J. Donlon, Gen. Counsel, Brotherhood of Railways, etc., Rosemont, Ill., for defendants-appellees.

Before BELL, AINSWORTH and GODBOLD, Circuit Judges.

GODBOLD, Circuit Judge:

This action involves a labor dispute between Railway Express, Inc. (REA), an express carrier governed by the Railway Labor Act, 45 U.S.C. § 151 et seq., and its operating personnel represented by the Brotherhood of Railway, Airline and Steamship Clerks, Freight Handlers, Express and Station Employees (BRAC). The dispute concerned proposed changes by REA in its trucking operations. During the course of their controversy the parties reached a seeming impasse, and REA unilaterally instituted the proposed changes in its own favor. In response BRAC called a strike. REA filed suit in federal district court seeking an injunction against the strike. BRAC counterclaimed requesting a status quo order.

The question of the strike's validity turns upon the determination of whether the underlying dispute is "major" — in which case the strike is permissible — or "minor" — in which circumstance BRAC cannot strike but must proceed with REA to arbitration before the National Railroad Adjustment Board. After a full evidentiary hearing and in an unpublished opinion the District Court held the dispute to be major. We reverse.

For many years REA has engaged in hauling freight. Initially its activities were carried on exclusively by rail, but in more recent years rail operations have become impractical and uneconomical. REA has, therefore, shifted more and more of its freight operations from rail to over-the-road (OTR) truck runs.

At present the parties are governed by a collective bargaining agreement effective since January 1, 1967. In apparent recognition of changing times, the contract to some extent undertook to provide for a smooth transition from rail operations to OTR runs. Rule 8 of the agreement provides:

By agreement with the General Chairmen in the Districts in which over-the-road truck runs are operated, the provisions of Rules 4, 5, 6 and 9 may be suspended and special provisions will be established governing hours of service, overtime, and basis of pay of over-the-road truck runs.

In an attempt to explain more thoroughly the meaning and force of Rule 8, the parties also agreed to the following "Memorandum of Understanding" as to the application of the rule:

It is agreed and understood that under the application of Rule 8 existing over-the-road truck runs will continue to operate in accordance with Article IX of the September 1, 1949 Agreement. Arrangements concerning operation of new runs will be worked out by agreement between the General Chairmen and Company representatives except that: * * * *

In the event of failure to make an agreement concerning the operation of a new run within forty-five (45) days after notice is given to the General Chairman or General Chairmen representing the employees to be affected, the matter may be referred by either party to final and binding resolution in accordance with Sections 3 and/or 7 of the Railway Labor Act, as amended. The issues submitted for such determination shall not include any question as to the right of the Company to establish the run but shall be confined to the manner of implementing the run.

Prior to the dispute which gave rise to this litigation, REA and BRAC had been able to agree upon all changes in working conditions necessary to implement a substantial number of OTR runs. At first "slip-seat" runs were instituted; that is, with respect to a run between terminals such as Philadelphia and Boston a truck would leave each terminal traveling toward the other. The two trucks would meet at a prearranged point approximately midway between the two terminals, exchange trailers, and return to their home bases.

The drivers were paid a fixed amount per round trip. For several reasons slipseating was inefficient. In the words of the District Court,

If one driver broke down or was unable to make the switching point on time, the other driver had to waste time awaiting his arrival. The time involved in switching operations was also lost, and REA found that, at least in some instances, the fixed "trip rate" agreed upon did not permit them to always get a full eight hours\' work for the equivalent of eight hours\' pay.

As a consequence of such shortcomings, REA and BRAC began renegotiating the operation of the OTR runs. The restructuring usually involved the elimination of the slip-seat arrangement and provided for a through run by one truck. Necessarily changes had to be made in layover procedures, hours of service, and rates of pay. All such matters were agreed upon on a run-by-run basis. During the existence of the 1967 contract, some 700 runs were restructured in this fashion. At the same time rail operations were continuing to dwindle, and OTR runs were substituted for inefficient rail routes. Changes in working conditions which arose on account of the substitution of an OTR run for a rail route were again worked out on an ad hoc basis for each run.

In the fall of 1970, REA proposed to substitute an OTR run for an existing rail run in the northeastern United States and to restructure 16 existing truck runs in the same geographical region. With respect to this proposal, the parties were unable to reach an accord on rates of pay, layovers, and changes in seniority and domicile rights. After lengthy negotiations and on April 13, 1971, REA served notice that it intended unilaterally to institute the proposed changes. The union denied the existence of such power and contended that since the proposals affected rates of pay and working conditions a major dispute was involved within the meaning of the Railway Labor Act. Accordingly, said the union, the changes could be made only by mediation pursuant to section 6 of the Act or by agreement. The union therefore served section 6 notices seeking to invoke the jurisdiction of the National Railroad Mediation Board. REA countered, stating that the dispute was minor, and refused to submit to mediation.

On April 19, 1971, as the date approached on which implementation was to occur, BRAC called a strike. Two days later REA filed its complaint in the United States District Court for the Northern District of Georgia. That court issued a temporary restraining order enjoining the strike, compelling the parties to negotiate further, and allowing REA to implement the disputed changes at its own risk pending a full hearing. REA did implement the changes.

Several weeks later, after a full evidentiary hearing, the District Court determined that the dispute was indeed major, and accordingly held that the union was automatically entitled to a status quo order, that is, an injunction forbidding REA's continued implementation of the runs. But rather than restoring the status quo at that point, the court stayed its order pending appeal. The court announced the following rationale:

Though not called upon to do so, the court, after hearing the evidence in this case, expresses the opinion: (1) that, in the long run, the making of the changes proposed by the plaintiff here (as distinguished from the manner in which they were proposed and made) is probably in the best interest of both parties; and (2) that the defendant union probably has no serious objection to them per se, provided only that the manner of their implementation can be agreed upon. In view of these opinions the court has ordered restoration of the status quo most reluctantly and only because it felt compelled to do so. The court therefore recommends to the parties that, if they agree with these conclusions, they proceed with all haste to attempt to reach an agreement. It has also occurred to the court that the conclusions reached in this order may be found to be wrong. If so, much damage may have accrued and many backward steps may have been taken. The court also believes that, pending an appeal, if any, the danger of irreparable injury to plaintiff is greater than to defendant. If the position of defendant is affirmed it can always exact restitution in the end. In view of these considerations, and in order to give the parties time to consider the suggestions made by the court, it is therefore ORDERED that execution of this order be stayed for a period of ten days or until a ruling on any appeal herein, should one be filed.

The question before this court is whether the District Court erred in its determination that the dispute is major. Several consequences flow from that finding. First, with respect to a major dispute, the Act provides that after failure to negotiate an agreement the parties may voluntarily submit the dispute to the National Railroad Mediation Board. 45 U.S.C. §§ 155, 156. If either party refuses, the Mediation Board is without power to decide the dispute or to force the parties to arbitrate, and they are free to resort to self help. Id.; Elgin, Joliet & Eastern Ry. Co. v. Burley, 325 U.S. 711, 65 S.Ct. 1282, 89 L.Ed. 1886 (1945). Finally, upon request by one of the parties, the federal court is required to issue a status quo order. 45 U.S.C. § 156; Detroit & Toledo Shore Line R. R. Co. v. United Transportation Union, 396 U.S. 142, 90 S.Ct. 294, 24 L.Ed.2d 325 (1969). On the other hand, if the dispute is minor the Act provides that upon failure to arrive at a negotiated settlement either party may request that the jurisdiction of the Adjustment...