Significant Decisions in Labor Cases*

Labor Relations

Refusal to Exercise Jurisdiction. The United States Supreme Court held that the dismissal of a representation petition on the sole ground of the National Labor Relations Board's "longstanding policy not to exercise jurisdiction over the hotel industry" was invalid, because it was contrary to an earlier decision of that court that the Board could not decline jurisdiction over another category of employers, as a class.2

The union in this case filed a petition for representation on behalf of a group of employees of hotels in Miami Beach. The Board dismissed the petition on the grounds that "it would not effectuate the policies of the act to assert jurisdiction over hotels." 3

A Federal district court, in sustaining the Board's action, declared that "Congress intended to lodge in the Board, rather than in the courts, a determination of what employer-employee relationships so affect interstate commerce as to require the exercise of the powers granted to the Board," although the Board was not empowered to act capriciously or arbitrarily.1

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The district court refused to hold that the Board's action was arbitrary or capricious in light of the position taken by the Board both prior to and since the enactment of the Labor Management Relations Act "that the hotel industry, other than in the District of Columbia, and in certain instances in the Territories, does not have such impact on interstate commerce as to justify the exercise of the Board's power in view of the pressing demands upon the Board of other industries having greater impact upon interstate commerce.' The circuit court of appeals affirmed the decision of the lower court without opinion.

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Dues Delinquency Discharge. The National Labor Relations Board held that a union and an employer both violated the Labor Management Relations Act in effecting the discharge of an employee pursuant to a union-security contract, for dues delinquency which resulted from the employee's failure to pay a fine, when the employer was aware of the circumstances surrounding the union's discharge request.

The employee in this case, upon being laid off, had applied to the union for a withdrawal card. He was told that he was ineligible for the card because he owed a fine for not attending union meetings. The employee did not pay the fine and did not get the card; therefore, in accordance with union practice, he did not become exempt from the dues requirement during the period of his layoff. When rehired several months later, the employee was told by the union that he would have to pay either back dues for the period of his layoff or a new initiation fee. He failed to do either. The union then requested the employer to discharge the employee for dues delinquency. The employer, who was aware of the circumstances in the case, complied.

*Prepared in the U. S. Department of Labor, Office of the Solicitor. The cases covered in this article represent a selection of the significant decisions believed to be of special interest. No attempt has been made to reflect all recent judicial and administrative developments in the field of labor law or to indicate the effect of particular decisions in jurisdictions in which contrary results may be reached based upon local statutory provisions, the existence of local precedents, or a different approach by the courts to the issue presented. 1 Hotel Employees Local 255 v. Leedom (U. S. Sup. Ct., Nov. 24, 1958). 2 See Office Employees Local 11 v. NLRB, Monthly Labor Review, July 1957, p. 849.

See Hotel Employees Local 255 v. Leedom, 147 F. Supp. 306 (U. S. D. C., D. C., 1957).

4 Ibid., p. 308.

5 Ibid.

6 Office Employees v. Labor Board, note 2, supra.

1 National Automotive Fibres, Inc. and Molton; Local 146, Tertile Workers Union of America, AFL-CIO and Same, 121 NLRB No. 173 (Oct. 14, 1958).

The Board found the conduct of the employer and the union to be unfair labor practices under sections 8 (a) (3), and 8 (b) (2) of the act, respectively. The sections ban discrimination against an employee subject to a union-shop contract if his membership was denied or terminated for reasons other than the failure of the employee to tender the periodic dues and initiation fees uniformly required as a condition of acquiring or retaining membership.

The NLRB stated that in previous cases it had held that these provisions require that dues be charged to all members alike or that any distinction be based upon reasonable general classifications. The Board held that "when the obligation to pay back dues depends in effect on whether or not a member attends union meetings, that type of charge is clearly not one that is uniformly applied."

Reimbursement Remedy. The National Labor Relations Board held that the Brown-Olds remedy requiring reimbursement of dues and fees paid by employees to a union under an illegal contract should not be applied where the contract was illegal only because the union was not in compliance with the filing requirements of sections 9 (f) and (h) of the Labor Management Relations Act at the time it executed the contract.

In this case, the union district council and the association, of which the employer was a member, entered into contracts containing union-shop clauses on May 17, 1956 and May 4, 1957, conforming with the substantive requirements of the Labor Management Relations Act. Compliance with the filing requirements of the act, which was achieved on August 17, 1955, expired on June 30, 1956. Thereafter, the council was out of compliance until August 1, 1957. The Board's compliance notices could have been received by the council only in August 1955 and August 1957.

When, in November 1956, the union refused membership to an employee who had been hired on the previous day and the employee related this experience to a partner of the employer, the partner stated that the employer was powerless to retain him.

In finding unfair labor practices on the part of the employer in giving effect to the union-security agreement of May 4, 1957, and of the union in enforcing that agreement, the Board held the

agreement invalid because the "proviso to section 8 (a) (3) of the act makes a prerequisite to the execution of a valid union-security agreement, the receipt of a notice of compliance from the Board 'at the time the agreement was made or within the preceding twelve months.'"

The Board deemed it unnecessary to consider the question of the validity of the May 17, 1956, contract because that contract had expired and because the Board considered that its order in this case adequately remedied any unfair labor practices that might have arisen from that earlier contract.

The Board ordered, among other things, that the employer cease giving effect to the restrictive hiring provisions of the May 4, 1957, contract and offer to the employee immediate and full reinstatement to his former or substantially equivalent position. Since the Board refused to apply the Brown-Olds remedy requiring the refund of all dues and initiation fees collected from all employees under the agreement during the 6 months preceding the filing of the unfair labor practice charges, the reimbursement provision of the order was limited to back pay, to be paid the employee by the employer and union, jointly and severally. The Board distinguished this case where there was a mere technical failure of compliance from the Brown-Olds case where the parties had entered into a provision which subsequently exceeded the permissible limits of the proviso to section 8 (a) (3). The provision in the Brown-Olds case conditioned employment upon union membership, without the benefit of the 30-day grace period required by that proviso.

Arbitration to Enforce Hot-Cargo Clause. A New York lower court ruled 10 not arbitrable the issue of whether a union is entitled to compel an employer to engage in a secondary boycott pursuant to a hot-cargo clause in their collective bargaining contract. The court said that if the employer were compelled to effect such a boycott through the medium of arbitration, Federal policy

8 Charles Ostrowski, d. b. a. Philadelphia Wood Work Co. and Roy Archer; Local 359, United Brotherhood of Carpenters and Metropolitan District Council of Philadelphia and Vicinity of the United Brotherhood of Carpenters and Same, 121 NLRB No. 201 (Oct. 31, 1958).

• United Association of Journeymen & Apprentices of Plumbing & Pipefitting Industry, Local 231 and Vernon L. Bryant and J. S. Brown-E. F. Olds Plumbing & Heating Corp., 115 NLRB 594 (1956).

10 In re Aper Lumber Corp. (N. Y. Sup. Ct., Suffolk County, Oct. 2, 1958).

expressed in section 8 (b) (4) (A) of the Labor Management Relations Act would be violated.

In this case, the employer moved to stay arbitration of a dispute which the union had sought to submit for arbitration. The dispute concerned the rights and duties of the parties flowing from the failure of the employer to engage in a secondary boycott pursuant to a provision of the collective bargaining agreement prohibiting the employer's employees from handling "nonunion" material when so requested by the union.

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In rejecting the union's contention that this > aspect of the dispute was arbitrable the court cited a recent decision " in which the U. S. Supreme Court indicated that while an employer can voluntarily cooperate in a secondary boycott, he cannot be compelled to do so since section 8 (b) (4) (A) of the act contemplates a "freedom of choice at the time the question whether to boycott or not arises in a concrete situation calling for the exercise of judgment on a particular matter of labor and business policy." The Supreme Court declared also that such a choice "must as a matter of Federal policy be available to the secondary employer notwithstanding any private agreement entered into between the parties."

The New York court held that the U. S. Supreme Court's decision required it to conclude that where, as here, the employer exercised his judgment not to engage in a secondary boycott, the union cannot compel through arbitration the performance called for by the "hot cargo" clause.

Suit for Violation of Union Bylaws. A Federal district court held 12 that section 301 of the Labor Management Relations Act which permits suits for violation of contracts between an employer and a labor a labor organization or between labor organizations is applicable to suits for violations of the constitution, bylaws, regulations, and resolutions of a labor organization to the detriment of its branch organization.

11 Local 1976, United Brotherhood of Carpenters v. NLRB, 357 U. S. 93 (1958); see Monthly Labor Review, August 1958, pp. 892-893.

Burlesque Artists Association v. American Guild of Variety Artists (U. S. D. C., S. D. N. Y., Aug. 14, 1958).

13 See Sun Shipbuilding & Dry Dock Co. v. Industrial Union of Marine & Shipbuilding Works of America, 95 F. Supp. 50 (U. S. D. C., E.D. Pa. 1950). 14 Textile Workers Union v. Cone Mills Corp. (U. S. D. C., M. D. N. C., Oct. 17, 1958).

1348 US 437 (1955); see Monthly Labor Review, June 1955, p. 679.

This suit was brought by a labor organization against both its parent organization and another branch of that parent, alleging violations by the other branch of the constitution, bylaws, regulations, and resolutions of the parent to the detriment of the complainant branch and failure by the parent to remedy those violations.

In refusing to dismiss the suit on the ground that the statute was inapplicable to it, the court reasoned that both the "plain language" of the statute itself and its legislative history indicate a broader scope for the word "contracts" than contracts arising solely out of collective bargaining. By eliminating the words "concluded as a result of collective bargaining" from the bill as first drafted, Congress intended the act to have broader application. The court recognized that its decision "clashes" with that of another Federal district court 13 which found that the legislative history revealed that Section 301 was intended to apply only to collective bargaining agreements.

The court refused also to dismiss the suit on the basis of the second contention of the defendants "that the parties are not separate labor organizations but component parts of a single labor organization and thus fail to satisfy the statutory requirement that the suit be 'between . . . labor organizations.'" The court found that the type of association between the parties in this case raised the issue of whether they were separate organizations which would have to go to trial.

Union's Right to Enforce Arbitration Award. A Federal district court held 14 that a union did not have standing to sue for enforcement of an arbitration award under Section 301 of the Labor Management Relations Act when the award was for personal benefits due individual employees and any benefit to the union was indirect.

The union brought this action to have the court enforce an arbitration award which sustained the union's claim that the employer was liable for the employees' unemployment-benefit losses attributable to the employer's designation of a brief shutdown as a vacation.

After rejecting various other asserted grounds for jurisdiction the court, relying upon Association of Westinghouse Salaried Employees v. Westinghouse Electric Corp.,15 declared that it was not empowered by section 301 of the LMRA to enforce the award. There, the U. S. Supreme Court had

held that a Federal court did not have jurisdiction in a suit brought by a union in behalf of employees, alleging a breach of contract in the failure of the employer to pay accrued wages due the employees. The district court stated that the "only material difference in the facts in the Westinghouse case and the facts in the suit here involved is that in the Westinghouse case the union brought suit in the district court before submitting the dispute to arbitrators, and in this case the union seeks to enforce the arbitrator's award." This difference did not make the Westinghouse doctrine inapplicable, the court indicated, since in both cases "the essential relief sought is the recovery of wages to employees." It also noted that the union in the present case did not claim any monetary benefits from the award.

The court distinguished the situations in both this case and the Westinghouse case from that in which the union is seeking to enforce the performance of an agreement to submit to arbitration an unresolved grievance.16

Although the Federal court would not hear this case, the court noted that many proceedings for enforcing or vacating arbitration awards under collective bargaining agreements involving industry in interstate commerce had been brought in the State courts of North Carolina, the State in which the employer was incorporated and the plants covered by the collective bargaining agreement were located.

16 See Monthly Labor Review, September 1958, p. 1018, discussing Item Co. v. New Orleans Newspaper Guild, 256 F. 2d 855 (5th Cir. 1958), where dispute sought to be arbitrated was limited to the grievance of a single employee.

Recent Labor Events

November 1, 1958

THE American Bakery and Confectionery Workers and the United Biscuit Co. concluded a contract covering a number of plants in several States. It provided 3,000 employees with a 2-step hourly wage increase—12 cents, effective at once, and an additional 11 cents on November 1, 1959—and a 4th week of vacation after 25 years' service. (See Chron. item for Dec. 5, 1957, MLR, Feb. 1958.)

DENTAL INSURANCE for employees is included in a contract which went into effect between the Oil, Chemical and Atomic Workers and Helena Rubinstein, Inc. Employees may use their own dentists under this plan, supported by employer contributions of $1.65 a month per employee and administered by Group Health Dental Insurance, Inc., New York City. GDHI will pay all dental expenses if the dentist is a participating dentist and the subscriber's income is under $5,000; in addition, GDHI pays for all fillings and extractions which the first visit shows to be needed.

November 2

SIX MAJOR AIRLINES signed a 1-year mutual-aid agreement, retroactive to October 20, to pay any struck signatory the increases in net revenues gained by other parties flying the signatory's routes during the strike. The pact covers stoppages called in support of wage demands in excess of increases recommended by a Presidential emergency board and before exhaustion of settlement procedures under the Railway Labor Act.

Subsequently, the Machinists, the Railway Clerks, other unions, and the nonscheduled airlines, urged the Civil Aeronautics Board to disapprove the agreement as a circumvention of the Railway Labor Act and antitrust laws. (See also p. 62 of this issue.)

On November 19, Capital Airlines and the Machinists agreed on a contract which runs until September 30, 1960, ending a monthlong strike in 18 cities of about 2,500 mechanics and ground service personnel. Mechanics, who number about three-fourths of the bargaining unit, will receive a wage increase of 41 cents during the life of the contract.

Agreements were also negotiated during the month by the same union with Northwest, National, and Northeast airlines.

THE Amalgamated Association of Street, Electric Railway and Motor Coach Employes and the Greyhound Corp. announced a new 2-year contract for about 12,000 employees in 20 States (the Atlantic, Central, Southeastern, Southwestern, and Richmond, Va., Greyhound Lines). In addition to liberalized holiday and vacation benefits, the contract provided, for hourly rated employees, a 10-cent-an-hour wage increase immediately, with 8 cents an hour more in 1959. Drivers paid on a mileage basis received increases to provide a uniform rate among the lines and in 1959 will receive a 0.2-cent-a-mile increase. November 4

VOTERS IN 6 STATES balloted on "right to work" measures which would have banned union membership as a condition of employment. The proposals were rejected in 5 States California, Colorado, Idaho, Ohio, and Washington-and approved in Kansas.

November 6

DEERE and Co., a farm equipment manufacturer, and the United Auto Workers announced a 3-year contract continuing an annual-improvement-factor increase of 3 percent of 1955 wage scales, and providing additional increases for skilled workers and liberalization of fringe benefits for about 16,000 employees. (See also p. 63 of this issue.)

Later in the month, Caterpillar Tractor Cc. and the same union, on strike since October 1, reached an agreement including immediate and deferred wage increases for about 12,000 workers in plants located at East Peoria and Morton, Ill.

THE SECRETARY OF LABOR, acting under the Public Contracts Act, issued an order raising the minimum hourly wage rate for workers in the soap and related products industry from $1 to $1.50, effective December 8, 1958.

November 7

THE AFL-CIO Executive Council ended a quarterly meeting in Washington, D. C., in which it had adopted a 10-point legislative program for 1959 and reviewed the "cleanup" steps taken by several of its affiliates following earlier directives by the Federation in its anticorruption efforts. The council also deferred Carpenters President Maurice A. Hutcheson's personal appearance to explain his failure to answer certain questions of the Senate Select Committee on Improper Activities in the Labor or Management Field. (See Chron. items for Aug. 18, 1958, MLR, Oct. 1958, and Nov. 14, 1958, below; also p. 67 of this issue.)

THE FEDERAL COURT OF APPEALS in New Orleans ruled, in Mitchell v. Robert DeMario Jewelry, Inc., that under section 17 of the Fair Labor Standards Act as amended