NLRB v. Jacobs Mfg. Co. Ruling
Uploaded by
Scribd Government DocsNLRB v. Jacobs Mfg. Co. Ruling
Uploaded by
Scribd Government Docs196 F.
2d 680
NATIONAL LABOR RELATIONS BOARD
v.
JACOBS MFG. CO.
No. 169.
Docket 22219.
United States Court of Appeals Second Circuit.
Argued March 4, 1952.
Decided May 9, 1952.
COPYRIGHT MATERIAL OMITTED George J. Bott, Gen. Counsel,
David P. Findling, Associate Gen. Counsel, A. Norman Somers, Asst.
Gen. Counsel, Frederick U. Reel and Samuel M. Singer, all of
Washington, D. C., Attorneys, National Labor Relations Board, for
petitioner.
Walfrid G. Lundborg and Shipman & Goodwin, all of Hartford, Conn.,
for respondent Jacobs Mfg. Co.
Before L. HAND, AUGUSTUS N. HAND and CHASE, Circuit Judges.
CHASE, Circuit Judge.
On July 15, 1948, the respondent and the representative of its employees, Local
379, United Automobile, Aircraft and Agricultural Implement Workers of
America, CIO, hereinafter called the union, executed a collective bargaining
agreement affective for two years. It contained a clause which provided that,
"After the expiration of one year from the date hereof either party may request
a meeting after fifteen days written notice, the purpose of which shall be to
discuss wage rates of employees covered by this agreement." During the
negotiation of this contract certain changes in an existing group insurance
program were discussed but nothing on that subject was put into the agreement.
The subject of pensions for employees was not even discussed.
On July 15, 1949, the union formally exercised its right under the above quoted
clause and, in its written notice to the respondent, requested a wage increase
together with changes in the group insurance program and the adoption of a
pension plan.
3
When the parties first met to discuss these demands, the respondent took the
firm position that it could not raise wages because business conditions made it
financially unable to do so. It refused to negotiate at all as to the subject of
changes in the group insurance program and the setting up of a pension plan on
the ground that neither of those subjects were within the scope of the reopening
clause in the contract. The union requested permission to examine the
respondent's books and sales records for the preceding year to "prove to the
people in the plant that the company was not" able to increase wages but the
respondent refused to furnish any such information on the ground that the
determination of this question was a matter solely within its own business
judgment. At a subsequent meeting of the parties there was substantially a
repetition of what had transpired at the first meeting. Following that, the union
made numerous requests for further meetings because it had "a great many
arguments to offer both on wages and the workers' security" but the respondent
declined, stating that its position remained unchanged and that the union should
communicate "such new and different thoughts * * * in writing to us so that we
may answer them by letter or in a meeting as requested by you."
On these facts, the Board held that the respondent had refused to bargain in
good faith in violation of 8(a) (1) and (5) of the Act, 29 U.S.C.A. 158 (a)
(1) and (5), by refusing to meet and confer with the union after the second
bargaining conference; by refusing to furnish the union with any information to
support its position that it was financially unable to grant the requested wage
increases; and by refusing to discuss the question of pensions.1
Decision as to enforcement turns upon the validity of the following parts of the
order:
"2. (a) Upon request bargain collectively with [the union] * * * with respect to
rates of pay, wages, hours of employment, including the subject of a pension
plan or program * * *."
"(b) Upon request furnish (the union) with such statistical and other
information as will substantiate the Respondent's position in bargaining with
the Union."
The respondent contends that it was under no statutory duty to confer with the
union after the second meeting since all of the issues had been fully explored
and the position of both parties expressed. Whether this was true, however, was
a question of fact which the Board found adversely to the respondent. Since at
both the meetings the respondent took the position that discussion of wage
increases would be futile because it was financially unable to make them, and
since it refused to discuss the other subjects at all, the Board was justified in
concluding that the respondent had refused to bargain in good faith as the Act
requires. Collective bargaining in compliance with the statute requires more
than virtual insistence upon a prejudgment that no agreement could be reached
by means of a discussion. Section 8(d) of the Act defines "collective
bargaining" as the "obligation of the employer and the representative of the
employees to meet at reasonable times and confer in good faith". This means
cooperation in the give and take of personal conferences with a willingness to
let ultimate decision follow a fair opportunity for the presentation of pertinent
facts and arguments. This affirmative obligation was not satisfied by merely
inviting the union to submit written offers for a settlement, nor by the bare
assertion of a conclusion made upon facts undisclosed and unavailable to the
union which was not acceptable without a presentation of sufficient underlying
facts to show, at least, that the conclusion was reached in good faith. N.L.R.B.
v. P. Lorillard Co., 6 Cir., 117 F. 2d 921, reversed on other grounds, 314 U.S.
512, 62 S.Ct. 397, 86 L.Ed. 380; Cf. Globe Cotton Mills v. N.L.R.B., 5 Cir.,
103 F.2d 91. Consequently, we hold that the respondent's conduct amounted to
an unfair labor practice and that it was lawfully required by the order to bargain
with the union upon request as to wage rates and hours of employment.
9
Furthermore, other than as above stated there had been no bargaining at all.
Unless the respondent was right in its position that it could lawfully refuse to
bargain as to pensions because the existing contract did not contain a reopening
clause broad enough to include that subject, it is clear that its refusal to bargain
as to them was also an unfair labor practice. We do not think the respondent
could lawfully refuse. Before the National Labor Relations Act was amended
by the Taft-Hartley Act an employer was under a duty, upon request, to bargain
with the representatives of his employees as to terms and conditions of
employment whether or not an existing collective bargaining agreement bound
the parties as to the subject matter to be discussed. See N.L.R.B. v. Sands Mfg.
Co., 306 U.S. 332, 342, 59 S.Ct. 508, 83 L.Ed. 682. However, 8(d) of the
amended Act, 29 U.S. C.A. 158(d), narrowed this requirement by providing
that the duty to bargain collectively "* * * shall not be construed as requiring
either party to discuss or agree to any modification of the terms and conditions
contained in a contract for a fixed period, if such modification is to become
effective before such terms and conditions can be reopened under the
provisions of the contract * * *." The respondent's position is that, except as to
subjects expressly reserved for further negotiations in a reopening clause, any
fixed period contract creates a static period in the entire industrial relationship
between the employer and his employees, for the term of the contract, even as
to aspects of that relationship which were not covered by that contract or even
discussed in the negotiations leading up to it.
10
We, however, agree with the Board that 8(d) cannot fairly be given such a
broad effect. The purpose of this provision is, apparently, to give stability to
agreements governing industrial relations. But, the exception thus created
necessarily conflicts with the general purpose of the Act, which is to require
employers to bargain as to employee demands whenever made to the end that
industrial disputes may be resolved peacefully without resort to drastic
measures likely to have an injurious effect upon commerce, and the general
purpose should be given effect to the extent there is no contrary provision.
Since the language chosen to describe this exception is precise and explicit,
"terms and conditions contained in a contract for a fixed period," we do not
think it relieves an employer of the duty to bargain as to subjects which were
neither discussed nor embodied in any of the terms and conditions of the
contract. Therefore, we hold that it was the respondent's statutory duty to
bargain on the subject of pensions. In so deciding, however, as we have already
indicated in commenting upon the Board's ruling concerning the group
insurance issue, we do not intend to pass upon the effect, if any, on the duty to
bargain, of mere previous discussion of a subject without putting any terms and
conditions as to it into the contract.
11
There remains for consideration the validity of that part of the order which
requires the respondent to substantiate its position, by furnishing information to
the union, that it was financially unable to meet the union's demands. While we
have not previously dealt with the precise question now raised, we think the
rationale of our decision in N.L.R.B. v. Yawman & Erbe Mfg. Co., 2 Cir., 187
F.2d 947, covers this situation. We have already decided that the respondent did
not fulfill its duty to bargain collectively when it refused to disclose pertinent
facts to show that it had, in good faith, reached its decision that it could not
afford to meet the union demands. We do not understand this part of the order
to require the respondent to do more than show its good faith in bargaining
collectively. To bargain collectively in compliance with the statute does not
mean that an employer must produce proof to establish that he is right in his
business decision as to what he can, or cannot, afford to do. He is left free to
decide that himself and, at the end of the bargaining, may agree only insofar as
he is willing in the light of all the circumstances. See 8(d). The Board's order
does not require the respondent to produce any specific business books and
records but information to "substantiate" its position in "bargaining with the
Union." As we interpret this, the requirement of disclosure will be met if the
respondent produces whatever relevant information it has to indicate whether it
can or cannot afford to comply with the Union's demands.
12
Enforcement granted.
Notes:
1
A majority of the Board thought that 8(d) of the Act, 29 U.S.C.A. 158(d),
absolved the respondent from the duty to bargain concerning group insurance
since that matter had been discussed during the negotiations leading up to the
contract. Therefore, the order sought to be enforced does not require the
respondent to bargain as to insurance and we need not pass upon the correctness
of this interpretation of 8(d)
