National Labor Relations Board v. National Motor Bearing Co. ( 1939 )

HANEY, Circuit Judge

(concurring and dissenting).

First. Two provisions of the order sought to be enforced command respondent to cease and desist from in “any manner” causing a prescribed effect. Provision 1 (a) commands respondent to cease and desist from “In any manner interfering with, restraining, or coercing its employees in the exercise of” the rights guaranteed the employees by § 7 of the act, 29 U.S.C.A. § 157. Whether we should enforce such a provision depends on whether the Board' has the power to make it. In determining whether the Board has such power, the intent of Congress is controlling, and our personal views as to what Congress should have done, or what power the Board should have are foreign to the issue, and are questions of policy to be exclusively determined by Congress.

Section 10(c) of the act, 29 U.S.C.A. § 160(c), empowers the Board to issue an order, as follows: “If upon all the testimony taken the Board shall be of the opinion that any person named in the complaint has engaged in or is engaging in any such unfair labor practice, then the Board * * * shall issue and cause to be served on such person an order requiring such person to cease and desist from such unfair labor practice * * * ” Thus it is clear that the Board may order an employer to cease and desist from “such” labor practice. By use of the word “such” the unfair labor practice is the one previously described, that is the unfair labor practice in which “any person in the complaint has engaged in or is engaging in.” (Italics supplied.) What is the unfair labor practice engaged in or which is being engaged in? It is the one described by § 8(1) of the act.

Section 8(1) of the act, 29 U.S.C.A. § 158(1), provides that it “shall be an unfair labor practice for an employer — (1) To interfere with, restrain, or coerce employees in the exercise of the rights guaranteed in section 7 [157].” What is described by that language? I think it is apparent that there is no single act of interference, restraint or coercion. Those words cover a multitpde of acts. It was manifestly intended to cover all acts which had the result or effect of interference, restraint or coercion. Thus it is apparent that the interference, restraint and coercion are notsingle things, but flow from and are descriptive only of the result or effect of many acts which may be done. In other words, the unfair labor practices were described, not by enumeration, but by their effect.

Just what did Congress include in the words “unfair labor practice” — the effect alone, the act alone, or both the effect and the act? As to the first of these possibilities, the order may be sustained only upon that ground. If only the effect of the act is the unfair labor practice, then the Board could properly order an employer who had caused the particular effect, to cease and desist from producing that effect.

I think it is clear that the unfair labor practice consists of both the act and effect. Not all acts are prohibited, but only those which have the described effect, and therefore the act alone cannot be the unfair labor practice. On the other hand, the unfair labor practice cannot consist of the effect alone, I think, because of the language of the act. By § 8(1) it is'provided that it is “an unfair labor practice for an employer * * * To interfere with, restrain, or coerce employees”. Reference to the dictionary shows that the words “interfere”, “restrain” and “coerce” include and exist only by doing an act.¹ Section 10(c) likewise leads to that conclusion. The Board does not find that an employer “has engaged in or is engaging in” an effect, but an act which has a particular effect. Likewise the Board does not order the employer to cease and desist from an effect, but from doing something which produces the effect.

This is made abundantly clear by the committee reports. Section 8 (2) of. the act, 29 U.S.C.A. § 158 (2), declares it to be an unfair labor practice for an employer to dominate or “interfere with” the formation or administration of any labor organization. Discussing such provision, Senate Committee on Education and Labor Report No. 573, 74th Cong., 1st Sess., p. 10, states: “The so-called ‘company-union’ features of the bill are designed to prevent interference by employers with organizations of their workers that serve or might serve as collective bargaining agencies. Such interference exists when employers actively participate in framing the constitution or bylaws of labor organizations; or when, by provisions in the constitution or by laws, changes in the structure of the organization cannot be made without the consent of the employer. It exists when they participate in the internal management or elections of a labor organization or when they supervise the agenda or procedure of meetings. It is impossible to catalog all the practices that might constitute interference, which may rest upon subtle but conscious economic pressure exerted by virtue of the employment relationship. The question is one of fact in each case * * *" [Italics supplied.] See also: House Committee on Labor Report No. 969, 74th Cong., 1st Sess., p. 15-17; Id., Report No. 972, pp. 16, 17; Id., Report No. 1147, pp. 18, 19. From the foregoing it can be seen that the word “practices” meant acts which had the mentioned effect.

The effect of such construction is sustained by the few decisions discussing the particular question. Swift & Company v. United States, 196 U.S. 375, 393, 402, 25 S.Ct. 276, 49 L.Ed. 518; New York, New Haven R. R. v. Interstate Com. Comm., 200 U.S. 361, 382, 404, 26 S.Ct. 272, 50 L.Ed. 515; and see: McNeill v. Southern Railway Co., 202 U.S. 543, 563, 26 S.Ct. 722, 50 L.Ed. 1142; Bitterman v. Louisville & Nashville R., 207 U.S. 205, 228, 28 S.Ct. 91, 52 L.Ed. 171, 12 Ann.Cas. 693; Hitchman Coal & Coke Co. v. Mitchell, 245 U.S. 229, 262, 273, 38 S.Ct. 65, 62 L. Ed. 260, L.R.A.1918C, 497, Ann.Cas.1918 B, 461. The majority rely on a dictum in National Labor Relations Board v. Fan-steel Metallurgical Corp., February 27, 1939, 59 S.Ct. 490, 83 L.Ed. 627, where the point was not considered. It is common knowledge that such a dictum usually fares badly when the point is actually considered. ' 14 Am.Jur. 295, § 83.

Therefore I think the unfair labor practice is an act which has a particular effect; that when an employer engages in an unfair labor practice, he engages in an act which has a described effect; that the statute authorizes the Board to order the employer to cease and desist from doing an act which has the described effect, and which he “has engaged in or is engaging in”; and that therefore the Board is unauthorized to order an employer to cease and desist from doing an act which may have the described effect, if the employer has not engaged in or is not engaging in such an act. Since provision 1(a) of the order includes acts which the employer has not engaged in and which he is not engaging in, such provision should be limited as stated above.

Second. I concur with the majority that provision 1 (b) of the order should not be enforced on the ground that the act of the employer which is called “surveillance” was not found by the Board to have the “effect” required by the statute.

Third. I likewise concur in the enforcement of provision 1 (c) of the order insofar as it commands respondent to cease and desist from encouraging or discouraging membership in labor organizations “by discharging * * * any of its employees” because there were findings that the “lockout” was a discharge and the discharge did encourage and discourage membership in labor organizations. Those inferences from the evidence could rightly be taken by the Board.

That part of provision 1 (c) of the order which commands respondent to cease and desist from “in any manner” discriminating in regard to the hire and tenure of its employees, should not be enforced for the reasons stated under “First”.

That part of provision 1 (c) of the order which commands respondent to cease and desist from discouraging and encouraging membership in labor organizations by “refusing to reinstate” the employees, should not be enforced, I think, because of the absence of proper findings. The majority concede that there is no express finding “that the refusal to reinstate discouraged or encouraged membership in a labor organization”. It proceeds, however, to eke out the Board’s findings by inference that the refusal to reinstate did have the prescribed effect. I think the action of the majority is wrongly taken, and the inference almost wholly erroneous.

As a matter of policy, this court should not adopt the practice of eking out the Board’s findings by inference, because (1) there is the lurking danger that we may draw an inference which the Board would not draw; (2) the Board’s duty is to consider all evidence, while our duty is only to ascertain whether findings made are supported by the evidence; and (3) unless we insist upon precise findings there is danger that the Board may carelessly leave a progressively larger number of facts to be ascertained by inference. The authority relied on by the majority makes it clear that the normal course is to remand for findings, but that in exceptionally clear cases we need not do so. Federal Trade Commission v. Curtis Co., 260 U.S. 568, 580, 43 S.Ct. 210, 67 L.Ed. 408. This court has consistently followed the normal course of remanding so that findings shall be made. Doernvecher Mfg. Co. v. Commissioner, 9 Cir., 80 F.2d 573; Fulton Oil Co. v. Commissioner, 9 Cir., 81 F.2d 33; Eaton v. Commissioner, 9 Cir., 81 F.2d 332; Von's Inv. Co. v. Commissioner, 9 Cir., 92 F.2d 861 Kelleher v. Commissioner, 9 Cir., 94 F.2d 294; United States v. Nez Perce County, Idaho, 9 Cir., 95 F.2d 232, 236. See also Interstate Circuit v. United States, 304 U.S. 55, 58 S.Ct. 768, 82 L.Ed. 1146; United States v. Esnault-Peltene, 299 U.S. 201, 206, 57 S,Ct.159, 81 L.Ed. 123. The majority point to no facts and the record discloses none, which justify a special dispensation to the Board in this case.

I further believe the “inescapable” inference drawn does violence to the record, The majority make no attempt to justify the inference by reference to any finding or evidence. Examination thereof shows that membership in the U. A. W. was apparently not discouraged, as shown by the Board’s finding: “Two more employees signed applications on February 27; two more on February 28; four on March 1; and four have signed since March 1”. No findings disclose that others might have joined, or that some joined the I. A. M., because of the refusal to reinstate. How the inference is supported is left wholly to conjecture, and it seems to me to be plainly wrong to make such an inference in view of the foregoing.

Fourth. Provision 1 (d) requires respondent to cease and desist from refusing to reinstate 56 men. There may lawfully be a refusal to reinstate such men. National Labor Relations Board v. Mackay Co., 304 U.S. 333, 345, 346, 58 S.Ct. 904, 82 L.Ed. 1381. The legality of the refusal to reinstate here is dependent upon whether or not such refusal encouraged or discouraged membership in labor organizations, a point upon which we have no finding, and for reasons stated under heading “Third” above, I think the cause should be remanded. Since it should be remanded I think the Board should be directed to find whether or not any or all of the 56 men were employees of respondent on February 18, 1938, the date of its order, in conformity with National Labor Relations Board v. Carlisle Lumber Co., 9 Cir.. 99 F.2d 533, 537.

Fifth. Provision 1 (e) of the order requires respondent to cease and desist from giving effect to the “so-called” contract of March 1, 1937 and the contract of April 19, 1937.

With . regard to the March 1st contract, the majority gratuitously assume that it was a closed-shop contract and void it on the ground that it was not authorized by § 8 (3) of the act. That action is my opinion, wholly unwarranted under the Boards findings, and I think there should he some judicial self restraint with respect to the interpretation of such findings. The contract, by its terms gives no indication that it was a closed-shop” contract, and the Board did not find it was. It found that respondent "treated" it as such. While the practical interpretation of a contract by one of the parties may be considered in determining what the parties intended by certain language, that rule, of course, has no application here because there was no language to interpret. In addition, it is not unusual for one party to misinterpret a contract, as shown by the countless cases on that subject. No doubt the Board was aware of that situation for it declined to find that it was a “closed-shop” contract to be voided under § 8 (3) of the act. It did find that respondent’s conduct in hastily entering into such contract “constituted a refusal to bargain with the duly designated representative of its employees in an appropriate unit” and was, therefore, an unfair labor practice within the meaning of § 8 (5) of the act. The action of the Board was correct if the U. was such representative a questl0n discussed below.

The April 19th contract, however, is in a different category. The request to bargain had already been refused by the March 1st contract. There is no finding that the April 19th contract refused any request whatever. It seems clear that it was not a refusal of a request already refused. Therefore its validity is dependent upon § 8 (3) of the act. The proviso of that section is that a “closed-shop” contract between the employer and a labor organization is not precluded by the act “if such labor organization is the representative of the employees as provided in section 9 (a), 29 U.S.C.A. § 159 (a) in the appropriate collective bargaining unit covered by such agreement when made”.

Respondent’s employees numbered 122. Of that number 96 we may term “production” employees. The Board found that the appropriate unit consisted of the 96 production employees. If it is intended to find that such unit was the one by which the validity of the April 19th contract is to be tested, I think it is clear that such action was wholly without authority. The statute fixes the unit to be the one “covered by such agreement when made” and the Board has no power to change such a unit agreed upon. The question, therefore, is: was the I. A. M. the designated representative of a majority of the 122 employees on April 19, 1937? Upon that question we have no finding whatever. The findings of the Board are directed to a smaller unit, as is the “conclusion” treated as a finding by the majority, contrary to United States v. Esnault-Pelterie, 299 U.S. 201, 206, 57 S.Ct. 159, 81 L.Ed. 123. For reasons stated under heading “Third”, above, I think we should remand the cause with directions to make a finding upon this question.

Sixth. The legality of provisions 1 (b) and (g) and of 1 (e) as relates to the March 1st contract, is dependent upon whether or not the U. A. W. was the designated representative of a majority of the employees “in a unit appropriate for such purposes”.

The U. A. W. on March 1st requested respondent to bargain with it as the representative designated by 122 of the employees. Its request claimed the entire group as a unit. The Board found that respondent committed an unfair labor practice by refusing to bargain with the representative of a smaller unit consisting of only 96 employees. I think the Board was without authority for that action as taken.

It is clear from the legislative history of the act that Congress did not intend to favor one independent union over another. There is nothing to indicate that the Board was intended to delve into the ordinary affairs of such unions. In the normal course of events, when a union presents a request to the employer to bargain, the employer is concerned only with the question as to whether such union is the designation of a majority of the employees in the unit claimed. If he grants the request, no question arises for the Board to determine. On the other hand, if he believes the union has not been designated by a majority, he may refuse the request, but such decision, like many others necessary for an employer to make, must be shown to be correct in the event' of a proceeding begun before the Board. He runs .the risk of an adverse decision by .the Board, the same as he runs the risk that other decisions on business affairs will not be upheld by the courts.

In case of such a dispute before the Board, it may not change the unit claimed, because, as will appear, such action would favor one independent union over another. In the case where a small craft unit has a contract with an employer, and subsequently a majority of the other employees designate another union, which requests the employer to bargain for such employees, the question arises. Upon refusal, if the majority happened also to be a majority of the total employees including the craft unit, then to hold that the Board may change the unit claimed by the union is to hold that the Board may select the entire plant unit and thus drive the craft unit out of existence although it may have been established in the plant for many years prior to the organization of the second union. I think there was no intent of Congress to force the craft unit to risk its existence upon the inclination of the Board in such cases.

It appears to me that, in reason, Congress expected the requests to bargain to be considered in the order of receipt, upon the equitable maxim “he who is first in time is best in right”. Salem Trust Co. v. Manufacturers’ Co., 264 U.S. 182, 192, 44 S.Ct. 266, 68 L.Ed. 628, 31 A.L.R. 867; 19 Am.Jur. 336, § 486. Under that .construction, the craft unit would be perfectly secure under its contract, which would prevent the later union from annihilating the smaller. In such cases, there would be no unfair labor practice in refusing to bargain for the entire group. The later union would be compelled to restrict its claim to a unit of employees not already represented by another unit.

In this connection, § 9 (b) provides that the Board “in each case” shall decide what unit is appropriate. A “case” would not exist in the situation where only one union was connected with the employees, because the employer may question only the representation, but not the unit. I think § 9 (b) is applicable only when a “case” arises, i. e. where two rival unions, before the employer has taken action on any bargaining request, request bargaining privileges, claiming units which overlap in their scope. In that situation, the employer by refusing one request and granting the other may subject himself to the charge of an unfair labor practice, and at the same time, the smaller unit risks its existence upon the decision of tile employer. I believe that in such situation the Board “shall” decide what unit is appropriate on the basis, as specified in the statute, of what unit will “insure to employees the full benefit of their right to self-organization and to collective bargaining, and otherwise to effectuate the policies of this Act”. Where such a situation arises, I think either union or the employer may seek and have the right to obtain, a decision of the Board as to the appropriate unit. With respect to the right of the employer to compel a decision of that question, the policy of the act as stated in § 1, 29 U.S.C.A. § 151, is, among other things, “to eliminate the causes of certain substantial obstructions to the free flow of commerce * * * Nothing in the act or its legislative history indicates that such obstructions were to be eliminated. only in the event that an employee or union requested it.

Here both the I. A. M. and the U. A. W. presented requests to bargain. Without invoking § 9 (b) of the act, respondent chose to refuse the request of the latter. In doing so, respondent committed an unfair labor practice, if the U. A. W. had been designated as the representative of a majority of the employees in the unit claimed, which was the entire group of 122 employees. I concur with the majority that 56 had designated the U. A. W. In addition, respondent stipulated that one Whaley was an employee, which must now prevail over the contention that he actually was not. To these 57 must be added five employees whom respondent seeks to exclude on the ground that they did not “freely” designate the U. A. W. but did so under coercion. The act does not require the absence of coercion. The legislative history clearly shows that the Board was to accept the designation as made by the employees and not concern itself with the debatable question as to what constitutes coercion; and that the employees had ample remedies then existing to prevent their own coercion by anyone other than the employer. House Committee on Labor, Report No. 969, and No. 972, 74th Cong., 1st Sess., pp. 13-15; Id., Report No. 1147, pp. 16-17; Senate Committee on Education and Labor, Report No. 573, 74th Cong., 1st Sess., p. 16; 79 Cong. Rec. pp. 7949-7960; 7967-7973, 10107.

Thus 62, a majority of 122, had designated the U. A. W. as their representative, and respondent committed an unfair labor practice in refusing to bargain with it on March 1st.

Seventh. Provisions 2 (a) and (b) of the order requiring reinstatement of the employees with back pay, I think, should not be enforced because of the absence of the finding mentioned in heading “Third” above.

Eighth. Provision 1 (d) of the order requires respondent to bargain with the U. A. W. upon request as the representative of the production employees, a unit consisting of 96 employees. Since the I. A. M. intervened in the proceeding, claiming the right to represent these employees, a “case” was made requiring decision by the Board, and its decision as to the appropriate unit does not appear to be erroneous. However, since the April 19tli contract may be valid, in which event provision 1 (d) would become inoperative, I think enforcement of that provision should await the findings to be made on remand.

For reasons above expressed, I dissent from the conclusion of the majority that the order should be enforced in its entirety except provision 1 (b) and other minor modifications. I think the parts of provisions 1 (a), 1 (c) and 1 (e) approved in the foregoing opinion, and provisions 2 (c), 2 (e) and 2 (f) should be enforced; that as to the remaining provisions, enforcement should be withheld, and the cause remanded to the Board for additional findings.

1 1 use the word “act” in the sense of a failure to perform a duty. I think it is conceivable that in a given situation an employer might fail to act at all, and the effect would be caused by the failure to act.