Virginia Electric & Power Co. v. National Labor Relations Board ( 1942 )

SOPER, Circuit Judge

(dissenting in part).

I concur in the result reached by the court in its opinion except insofar as it approves that part of the order of the Board which requires the Power Company to reimburse its employees for all of the dues deducted from their wages for the benefit of the independent organization. The argument in favor of the order is that since the checkoff was associated with the closed shop, the monies deducted from the wages of the men constituted payments made by them under the fear of losing their jobs; and that repayment is necessary to offset the coercive measures of the company and to effectuate the purposes of the Act. Similar arguments have been rejected by five Circuit Courts of Appeals in every case in which the exercise of the power has been attempted.

The facts in the present case in this regard are that the closed shop and checkoff were forced upon the company against its will by the independent organization; that no employee now seeks the return of his money; and that the company received no financial or other benefit from the payments, since they were turned over to the independent organization and used by it in successful efforts to secure substantial advantages for the employees in wages and working conditions. Under these circumstances there is no justice in ordering the return of the money for which the men have received their money’s worth. Nor is there merit in the contention that the money should be returned because it was paid under compulsion. There is an element of duress in every closed shop wherein workmen are compelled to recognize the union and to pay the required dues, but these conditions are considered lawful because they are imposed upon the employees by their own action. There is no greater compulsion in the case of a company dominated union, when the closed shop and checkoff fees result from the voluntary action of the men and are accepted by the company against its desire in order to preserve industrial peace. It may be added that there is no greater reason to require a return of the wages checked off in this case than to recompense employees in every case for dues paid directly to a company union.

The effect of this provision of the Board’s order is not to effectuate the policies of the Act, for that is done completely by the disestablishment of the independent organization whereby the freedom of the employees to choose their own representatives is made secure. The effect is merely to obtain the deterrent influence that is expected to flow from the imposition of a penalty. But the Supreme Court has held that the Board has no power to inflict punishment for its deterrent effect. In Republic Steel Corp. v. Labor Board, 311 U.S. 7, 11, 12, 61 S.Ct. 77, 79, 85 L.Ed. 6, the court, speaking of the power of the Board to take such affirmative action as will effectuate the policies of the Act, said:

“This language should be construed in harmony with the spirit and remedial purposes of the Act. We do not think that Congress intended to vest in the Board a virtually unlimited discretion to devise punitive measures, and thus to prescribe penalties or fines which the Board may think would effectuate the policies of the Act. We have said that ‘this authority to order affirmative action does not go so far as to confer a punitive jurisdiction enabling the Board to inflict upon the employer any penalty it may choose because he is engaged in unfair labor practices, even though the Board be of the opinion that the policies of the Act might be effectuated by such an order.’ We have said that the power to command affirmative action is remedial, not punitive. Consolidated Edison Co. v. National Labor Relations Board, 305 U.S. 197, 235, 236, 59 S.Ct. 206, 219, 83 L.Ed. 126. See, also, National Labor Relations Board v. Pennsylvania Greyhound Lines, 303 U.S. 261, 267, 268, 58 S.Ct. 571, 574, 575, 82 L.Ed. 831, 115 A.L.R. 307. We adhere to that construction.

“In that view, it is not enough to justify the Board’s requirements to say that they would have the effect of deterring persons from violating the Act. That argument proves too much, for if such a deterrent effect is sufficient to sustain an order of the Board, it would be free to set up any system of penalties which it would deem adequate to that end.”