Spartans Industries, Inc. v. NLRB

• Decision Date: 31 January 1969
• Docket Number: No. 26220.,26220.
• Citation: 406 F.2d 1002
• Parties: SPARTANS INDUSTRIES, INC., Petitioner, v. NATIONAL LABOR RELATIONS BOARD, Respondent.
• Court: U.S. Court of Appeals — Fifth Circuit

406 F.2d 1002 (1969)

SPARTANS INDUSTRIES, INC., Petitioner, v. NATIONAL LABOR RELATIONS BOARD, Respondent.

No. 26220.

United States Court of Appeals Fifth Circuit.

January 31, 1969.

John E. Jay, Walter N. Kaufman, Parker, Chapin & Flattau, New York City, for petitioner. Michael J. Shef, New York City, of counsel.

Marcel Mallet-Prevost, Asst. Gen. Counsel, Harold B. Shore, Atty., NLRB, Washington, D. C., Arnold Ordman, Gen. Counsel, Dominick L. Manoli, Associate Gen. Counsel, Michael N. Sohn, Atty., NLRB, for respondent.

S. G. Lippman, Donald Grody, Washington, D. C., James P. Wolf, Houston, Tex., for intervenor.

Before GOLDBERG and MORGAN, Circuit Judges, and LIEB, District Judge.

MORGAN, Circuit Judge:

This case is before the court upon the petition of Spartans Industries, Inc., to review and set aside the Board's order issued against it on January 24, 1968. The Board has cross-petitioned for enforcement. The Board found that the Company violated Section 8(a) (2) and (1) of the National Labor Relations Act¹ by extending recognition to a union at a time when the union did not represent a majority of its employees in an appropriate unit.

The Company is a New York Corporation operating a chain of retail stores in a number of states in the United States. Prior to March 1966, petitioner operated two retail stores in San Antonio, Texas, which employed about 84 and 86 employees, respectively. These two stores operated under a collective-bargaining agreement between the Company and Local 455, Retail Clerks International Association, AFL-CIO. This agreement provided, in part:

"* * * the application of the terms and provisions of this Agreement shall embrace all present and future retail establishments of the Employer situated within the San Antonio, Texas, metropolitan area * * *"

In March 1966, the Company merged with Atlantic Thrift Center, Inc. As a result of this merger, the Company acquired the Atlantic Thrift retail store in San Antonio, which employed about 77 employees. The employees at this store operated under a collective bargaining agreement between the Company and Texas-Oklahoma Joint Board, Amalgamated Clothing Workers of America, AFL-CIO which provided, in part:

"The Employer recognizes the Union as the sole and exclusive collective bargaining agent for all employees * * now employed or hereafter to be employed in the Employer\'s present and future establishments located in greater metropolitan San Antonio, Texas * * *"

At the time of the merger, Atlantic had signed a lease for a new San Antonio retail store. This new store was opened for business in August 1966.

In July 1966, the president of petitioner's Spartan Department Stores Division sent identical letters to the respective parent bodies of the Retail Clerks Union and Amalgamated Clothing Workers Union. The effect of these letters was to notify both labor organizations that the Company would assume a neutral position with respect to Union representation of its employees at the new store. In addition, it assured both unions that the new employees would be hired through state agencies rather than be transferred from the existing stores. In the guidelines that accompanied the letter it was stated that no representative of any union would be permitted to enter the store for organizing purposes and that no management representative would engage in any activities in favor of or against any union.

Both the Retail Clerks and Amalgamated Clothing Workers were dissatisfied with the policy established by the Company. The Retail Clerks contended that as a proper interpretation of their contract the employees of the new store should be within their union. In response, Amalgamated Clothing Workers notified the Company that any attempt by it to recognize any other union prior to the outcome of an election would result in their filing an unfair labor practice charge.

In September 1966, the chairman of the Company's Board of Directors informed both unions that henceforth it would recognize the Retail Clerks Union as exclusive bargaining agent for the employees at the new store. The employees of the new store were also advised of this determination. Shortly thereafter, representatives of the Retail Clerks, with the Company's permission, spoke to employees in the employees' lounge and solicited membership and authorization for dues deductions.

In response to this recognition given the Retail Clerks by the Company, Amalgamated Clothing Workers filed a complaint with the Regional Director. In affirming the Trial Examiner, the Board found that the Company violated Section 8(a) (2) and (1) of the Act as well as that the new store constituted an appropriate unit for the purposes of collective bargaining.

In arriving at a determination in this matter, we must consider several principles of labor policy which have been established by the Congress and the Courts. Section 9(b) of the Act² directs the Board to fashion its collective bargaining unit determination in such a manner as to insure to employees the fullest freedom in exercising their rights guaranteed by this Act. Such Board unit determinations involve of necessity a large measure of informed discretion and should not be set aside unless the reviewing court finds that the Board has exercised its discretion in an arbitrary or capricious manner. Packard Motor Car Co. v. N. L. R. B., 330 U.S. 485, 67 S.Ct. 789, 91 L.Ed. 1040 (1947); May Dept. Stores Co. v. N. L. R. B., 326 U.S. 376, 66 S.Ct. 203, 90 L.Ed. 145 (1945).

We have concluded that the Board's ruling in this action was not unsupported or arbitrary. The spirit of the national labor policy is grounded on the fundamental precept that employees should be free to select their representatives. Although the doctrine of accretion...