00-359
In the Supreme Court of the United States
LOCAL 702, INTERNATIONAL BROTHERHOOD
OF ELECTRICAL WORKERS, AFL-CIO AND INTERNATIONAL UNION OF OPERATING ENGINEERS,
LOCAL 148, AFL-CIO, PETITIONERS
v.
NATIONAL LABOR RELATIONS BOARD AND
CENTRAL ILLINOIS PUBLIC SERVICE COMPANY
ON PETITION FOR A WRIT OF CERTIORARI
TO THE UNITED STATES COURT OF APPEALS
FOR THE DISTRICT OF COLUMBIA CIRCUIT
BRIEF FOR THE
NATIONAL LABOR RELATIONS BOARD
IN OPPOSITION
SETH P. WAXMAN
Solicitor General
Counsel of Record
Department of Justice
Washington, D.C. 20530-0001
(202) 514-2217
LEONARD R. PAGE
General Counsel
NORTON J. COME
Deputy Associate
General Counsel
JOHN EMAD ARBAB
Attorney
National Labor Relations
Board
Washington, D.C. 20570
QUESTION PRESENTED
Whether the National Labor Relations Board permissibly concluded that an
employer did not commit an unfair labor practice, in violation of Section
8(a)(1) and (3) of the National Labor Relations Act, 29 U.S.C. 158(a)(1)
and (3), by locking out union employees in response to "inside game"
tactics during contract negotiations.
In the Supreme Court of the United States
No. 00-359
LOCAL 702, INTERNATIONAL BROTHERHOOD
OF ELECTRICAL WORKERS, AFL-CIO AND INTERNATIONAL UNION OF OPERATING ENGINEERS,
LOCAL 148, AFL-CIO, PETITIONERS
v.
NATIONAL LABOR RELATIONS BOARD AND
CENTRAL ILLINOIS PUBLIC SERVICE COMPANY
ON PETITION FOR A WRIT OF CERTIORARI
TO THE UNITED STATES COURT OF APPEALS
FOR THE DISTRICT OF COLUMBIA CIRCUIT
BRIEF FOR THE
NATIONAL LABOR RELATIONS BOARD
IN OPPOSITION
OPINIONS BELOW
The opinion of the court of appeals (Pet. App. 1a-14a) is reported at 215
F.3d 11. The decision and order of the National Labor Relations Board (Pet.
App. 15a-262a) are reported at 326 N.L.R.B. 928.
JURISDICTION
The judgment of the court of appeals was entered on May 9, 2000. On July
31, 2000, the Chief Justice extended the time within which to file a petition
for a writ of certiorari to and including September 6, 2000, and the petition
was filed on that date. The jurisdiction of this Court is invoked under
28 U.S.C. 1254(1).
STATEMENT
1. Section 8(a)(1) of the National Labor Relations Act (Act), 29 U.S.C.
158(a)(1), makes it an unfair labor practice for an employer "to interfere
with, restrain, or coerce employees in the exercise of the rights guaranteed
in" Section 7 of the Act, 29 U.S.C. 157. The rights guaranteed in Section
7 include the right to bargain collectively and the right to engage in concerted
activity for the purpose of collective bargaining. Section 8(a)(3) of the
Act, 29 U.S.C. 158(a)(3), makes it an unfair labor practice for an employer
"by discrimination in regard to hire or tenure of employment or any
term or condition of employment to encourage or discourage membership in
any labor organization."
This Court held in American Ship Building Co. v. NLRB, 380 U.S. 300 (1965),
that employers do not violate Section 8(a)(1) or Section 8(a)(3) by locking
out their employees in order to place economic pressure on the employees'
union during a bargaining dispute. Such a lockout does not violate Section
8(a)(1) because "the employer's use of a lockout solely in support
of a legitimate bargaining position is [not] in any way inconsistent with
the [employees'] right to bargain collectively or with the right to strike."
380 U.S. at 310. Such a lockout also does not violate Section 8(a)(3) because
"use of the lockout [in bargaining] does not carry with it any necessary
implication that the employer acted to discourage union membership or otherwise
discriminate against union members as such." Id. at 312. Therefore,
when the employer's intention "is merely to bring about a settlement
of a labor dispute on favorable terms, no violation of § 8(a)(3) is
shown." Id. at 313.
In a companion case, NLRB v. Brown, 380 U.S. 278 (1965), the Court determined
that there likewise is no per se violation when the employer, having lawfully
locked out employees during a strike, takes the additional step of hiring
temporary replacement workers. Hiring temporary replacement workers might
discourage union membership, but that tendency is "comparatively remote,"
whereas the practice advances a "legitimate business end." Id.
at 289. Any improper motivation of the employer therefore must be established
by independent evidence, apart from the fact of the lockout and hiring of
replacement workers. Id. at 288-289.
Based largely upon its holdings in American Ship Building Co. and Brown,
the Court later articulated a two-step framework for analyzing alleged violations
of Section 8(a)(3). See NLRB v. Great Dane Trailers, Inc., 388 U.S. 26 (1967).
The National Labor Relations Board (Board) may find a violation "if
it can reasonably be concluded that the employer's discriminatory conduct
was 'inherently destructive' of important employee rights"-regardless
of the evidence concerning the employer's actual motivation. Id. at 34.
If the employer engages in conduct that is discriminatory and "could
have adversely affected employee rights to some extent," but is not
so inherently destructive of employee rights that an unlawful motive can
be presumed, then the employer can avoid a finding of a violation by proving
a legitimate motive for its conduct. Ibid.1
The present case involves the Board's application of those settled legal
principles to an employer lockout during contract negotiations.
2. Respondent Central Illinois Public Service Company (CIPS) is a public
utility that furnishes electricity and natural gas throughout central and
southern Illinois. Some of CIPS's production, maintenance, and operational
employees are represented by petitioner Local Union 702 of the International
Brotherhood of Electrical Workers. Others are represented by petitioner
Local Union 148 of the International Union of Operating Engineers. Pet.
App. 17a.
CIPS's separate collective bargaining agreements with the two unions expired
in June 1992. CIPS and the unions continued to negotiate new agreements.
In March 1993, CIPS provided a "final" contract offer to each
union. The employees in both unions voted to reject CIPS's offer. Rather
than striking, however, the employees in both unions voted to remain on
the job and pursue an "inside game" strategy designed to put pressure
on CIPS to accede to the unions' bargaining demands. Pet. App. 2a-3a, 17a-18a.
The inside game strategy consisted of refusals to work voluntary overtime
and of "work-to-rule" tactics such as adhering strictly to all
company rules, doing exactly and only what the employee had been told to
do, reporting to work precisely on time, leaving work trucks at company
facilities during non-duty hours (thus precluding responses to after-hours
emergencies), presenting all grievances as a group, advising non-employees
to report unsafe conditions, and advising customers of their rights to information
from CIPS and to have their meters checked annually for accuracy. Id. at
2a-3a. The union employees commenced their inside game campaign on April
24, 1993, and the parties continued to negotiate. Id. at 3a.
During the inside game campaign, CIPS's industrial relations manager, Charles
Baughman, confronted a Local 702 representative with a union document outlining
the work-to-rule activities and stated that CIPS "was not going to
put up with" the activities. Later, after CIPS and Local 702 settled
a particular grievance presented by union employees as a group, Baughman
stated that he was "not going to tolerate these mass grievance meetings"
in the future. Pet. App. 18a.
On May 20, 1993, CIPS locked out all employees in the bargaining units represented
by the two unions. Baughman explained that CIPS's decision was a response
to the unions' inside game activities. Pet. App. 18a-19a. In a form letter
sent to Local 702 unit employees on May 20, CIPS's Chief Executive Officer
elaborated on the reasons for the lockout, stating that:
Based on the events of the last few weeks, I do not feel there is any other
alternative. During this period, the Company has failed to receive what
it is entitled to from employees represented by IBEW Local 702 in return
for the wages and benefits which make it possible for you to provide your
families with security and well-being. We have consistently encountered
refusals to work overtime, excessive work-to-rule practices that have hurt
productivity, and refusals to provide necessary information to supervisory
personnel. These conditions are neither acceptable nor warranted.
Id. at 18a-19a. The form letter described the unsuccessful contract negotiations
over the previous year, and what CIPS had done to address union demands.
Id. at 26a-27a. The letter stated that the unions' rejection of CIPS's latest
contract proposal, together with an intensification of the inside game campaign,
led to the lockout. The letter concluded:
Like you, I am anxious to bring these issues to a successful conclusion
and have you back at your jobs at the earliest possible date. I sincerely
regret the disruption this decision will bring into your lives. My hope
is that this aspect of our labor dispute is short-lived.
Id. at 27a. An attachment to the letter summarized the changes to the expired
contract that CIPS and Local 702 had "agreed upon or which remain a
part of the company's offer." Ibid. Employees represented by Local
148 received a similar form letter. Ibid.
After locking out the union employees, CIPS continued its operations without
hiring replacement workers. Pet. App. 93a. CIPS continued to negotiate with
both unions. On June 14, 1993, CIPS and Local 148 agreed on a new contract.
After that agreement was signed on June 21, CIPS ended the lockout against
Local 148, but the Local 148 employees refused to return to work as a show
of support for Local 702. On August 25, 1993, CIPS ended the lockout of
Local 702 employees, although CIPS and Local 702 did not reach agreement
on terms for a new contract until January 1994. Id. at 19a.
3. The unions filed unfair labor practice charges with the Board, alleging
in relevant part that the lockout violated Sections 8(a)(1) and 8(a)(3)
of the Act. Pet. App. 3a. Following a hearing, an administrative law judge
(ALJ) concluded that CIPS violated those provisions of the Act because the
inside game campaign constituted protected activity and the lockout was
intended as punishment for that activity. Id. at 232a-248a.
The Board reversed the ALJ and dismissed the unions' claims regarding the
lockout. Pet. App. 15a-35a. The Board assumed that the unions' inside game
tactics were protected activity under Section 7 of the Act. Id. at 21a.
But applying the analytic framework set out in Great Dane Trailers, supra,
the Board concluded that CIPS's lockout did not violate Section 8. Pet.
App. 21a-35a.
The Board first found, in accordance with American Ship Building Co., that
"the lockout in the instant case, standing alone, cannot be considered
inherently destructive of employee rights." Pet. App. 23a-24a. The
Board therefore proceeded to determine whether CIPS possessed a legitimate
and substantial business justification for the lockout. Id. at 24a. Overruling
the ALJ, the Board concluded that, even if the sole objective of the lockout
had been to force the unions to cease their inside game activities, this
was not an impermissible objective. The unions adopted their inside game
strategy "in the midst of bargaining negotiations with the hope of
securing agreement on their terms for new contracts." Id. at 25a. Under
that circumstance, CIPS's decision to defend itself with a lockout, in order
to force the unions to yield in the contract negotiations, was consistent
with the principle "that the 'right to bargain collectively does not
entail any "right" to insist on one's position free from economic
disadvantage.'" Ibid. (quoting American Ship Building Co., 380 U.S.
at 309).
The Board's assumption that the inside game strategy constituted protected
activity did not change the analysis. The Board noted that the employees'
strike in Brown was protected under Section 7, yet the Brown Court determined
that the employer's responsive lockout and hiring of replacement workers
did not violate Section 8. Pet. App. 25a-26a.
The Board further found that forcing the unions to end their inside game
tactics was not the only objective of CIPS's lockout. Contrary to the ALJ,
the Board determined that "a fair reading of" CIPS's May 20 letter
to union employees showed that the goal of the lockout was not only to stop
the inside game, but also to obtain a "resolution of issues that were
dividing the parties in their bargaining negotiations." Pet. App. 26a.
"The message conveyed," the Board found, was that CIPS "wanted
employees to be allowed to review and consider its most recent contract
proposals." Id. at 28a. The Board held that "application of economic
pressure in support of [CIPS's] bargaining position constitutes a legitimate
and substantial business justification for the lockout." Ibid. Moreover,
there was no evidence to suggest that the lockout was intended to undermine
the collective bargaining process; CIPS's good-faith contract negotiations
and history of accepting the unions' representative status were in fact
inconsistent with an inference of antiunion animus. Id. at 33a-35a.2
Board Member Liebman dissented. She agreed with the ALJ that the lockout
was motivated by antiunion animus and was not justified by legitimate and
substantial business objectives. Pet. App. 43a-66a.
4. The court of appeals denied the unions' petitions for review. Pet. App.
2a. The court found reasonable the Board's conclusion that CIPS's use of
a lockout in response to the economic pressure of inside game tactics was
justified. Id. at 8a. The May 20 form letters and other evidence also supported
the Board's determination that CIPS legitimately sought to resolve the contract
negotiations through the lockout. Id. at 8a-10a, 13a. Finally, the record
did not contain other evidence establishing antiunion animus. Id. at 10a,
12a-14a.
Citing American Ship Building Co. and Brown, the court of appeals rejected
the argument that the lockout was necessarily unlawful because it was intended,
at least in part, to end the unions' assumedly protected inside game activities.
Pet. App. 11a. The court of appeals also rejected the unions' claim that
the Board had departed from its prior decisions. Id. at 11a-12a.
ARGUMENT
The decision of the court of appeals is correct and does not conflict with
decisions of this Court or of any other court of appeals. Nor is there any
inconsistency in the Board's own decisions. Further review therefore is
not warranted.
1. Petitioners do not dispute (Pet. 9 n.6) that CIPS locked out its union
employees at least in part to support CIPS's bargaining position in contract
negotiations -without regard to the unions' inside game activities. Petitioners
instead seek to distinguish CIPS's admittedly lawful use of the lockout
to advance its bargaining position from CIPS's allegedly unlawful use of
the lockout as "retaliation" (Pet. 13) for the unions' inside
game strategy. Yet the Board rejected the ALJ's finding of retaliation (Pet.
App. 240a, 242a) because it was inconsistent with the record evidence. Id.
at 28a-35a. The Board explained that the inside game strategy was "an
economic weapon used in support of the Unions' bargaining position and against
[CIPS's] bargaining position." Insofar as the lockout was directed
at ending the inside game strategy, it was an "economic weapon in response
to the Unions' economic weapon." Id at 28a. No evidence suggested antiunion
animus. Id. at 30a-35a.
The court of appeals upheld the Board's assessment of the record evidence
(Pet. App. 10a, 12a-13a), and petitioners have not sought review on that
issue. In fact, petitioners accept that "this Court does not sit to
resolve evidentiary disputes." Pet. 10 n.6. This case accordingly is
governed by the Court's holding in American Ship Building Co. that a lockout
designed "merely to bring about a settlement of a labor dispute on
favorable terms" is not an unfair labor practice. 380 U.S. at 313;
see Brown, 380 U.S. at 284 (same).
The Board did not "privileg[e] employer lockouts in reprisal for employee
protected, concerted activity." Pet. (i); see also Pet. 10-13. Rather,
the Board, affirmed by the court of appeals, found that CIPS locked out
its employees (1) to neutralize the unions' economic weapon in the contract
negotiations, and (2) to resolve the contract issues that were dividing
the parties. Pet. App. 25a-26a, 28a-30a. The lockout was "in opposition
to the Unions' bargaining position," not in opposition to the employees'
right to engage in protected Section 7 activity. Id. at 30a.
The Board specifically did not address "a situation where a lockout
is in response to protected activity that is unrelated to a union's bargaining
position." Pet. App. 30a n.18. Likewise, this case does not present
a situation in which an employer's legitimate economic motivation for a
lockout was mixed with antiunion animus. Under the facts presented here,
petitioners' recognition that "a true employer bargaining lockout is
lawful" (Pet. 10 n.6) resolves the case.
2. As explained above, the Board properly applied both American Ship Building
Co. and Brown. The Board's decision also is in accord with Lodge 76, International
Ass'n of Machinists v. Wisconsin Employment Relations Comm'n, 427 U.S. 132
(1976). In that case, the Court held that the Act preempted a State from
interfering with employees' concerted refusal to work overtime during a
bargaining dispute. In so ruling, the Court noted that the employer had
legitimate economic tools of its own. For instance, even if the employees'
refusal to work overtime constituted a protected Section 7 activity, the
employer could have responded with a lockout in order to put economic pressure
on the union. Id. at 152-153. The option suggested by the Court in Machinists
Lodge 76 is the very one CIPS implemented in this case.
Nor is there any conflict between the court of appeals' decision in this
case and decisions of other courts of appeals. Because the Board determined
that CIPS did not act with an antiunion motive, the retaliation cases cited
by petitioners (Pet. 14-15, 17 n.9) are inapposite. As petitioners themselves
suggest, those cases address "adverse employer action based on an improper
motive." Pet. 14; see, e.g., Molon Motor & Coil Corp. v. NLRB,
965 F.2d 523 (7th Cir. 1992) (discharge motivated by antiunion animus);
Movers & Warehousemen's Ass'n. v. NLRB, 550 F.2d 962 (4th Cir.) (lockout
motivated in part by desire to influence union's procedure for ratifying
contract), cert. denied, 434 U.S. 826 (1977); NLRB v. Zelrich Co., 344 F.2d
1011, 1014 (5th Cir. 1965) (Christmas bonuses withheld to discourage membership
in the union, and as retaliation for employees' majority vote for the union);
see also Reno Hilton Resorts v. NLRB, 196 F.3d 1275, 1282-1285 (D.C. Cir.
1999) (contracting out motivated by antiunion animus).3
Finally, there is no inconsistency in the Board's own decisions-an issue
that would not warrant a grant of certiorari in any event. Petitioners rely
on Board determinations that "employer lockouts in reprisal for employees'
concerted, protected activities do[] violate §§ 8(a)(1) and 8(a)(3)."
Pet. 15. Yet the Board found in this case that CIPS's lockout was not a
"reprisal," but rather an economic weapon used in support of CIPS's
bargaining position and in opposition to the unions' chosen economic weapon.
As the court of appeals noted (Pet. App. 11a-12a), that finding renders
inapposite the Board precedents relied upon by petitioners (Pet. 15-16).
In Highland Superstores, Inc., 314 N.L.R.B. 146 (1994), for example, the
Board found a Section 8 violation where the employer punished union employees
for handbilling in support of a consumer boycott, and "there [wa]s
no merit to the Company's claim that it locked its employees out to pressure
the Union at the bargaining table." Id. at 148. In Riverside Cement
Co., 296 N.L.R.B. 840 (1989), the Board found that a lockout was unlawful
because the employer had not acted "to support a legitimate bargaining
position," but rather, to enforce a new workplace rule that was inconsistent
with the governing terms of employment. 296 N.L.R.B. at 842 & n.10.
Finally, in Thrift Drug Co., 204 N.L.R.B. 41 (1973), enforced, 491 F.2d
751 (3d Cir. 1974), the employer suspended only a lone employee whose picketing
on behalf of the union had stopped deliveries, while taking no action against
other picketing employees whose picketing did not have that effect. This
singling-out was discriminatory and reflected that the employer's real concern
was stopping the employee from picketing at the delivery entrance, not advancing
the employer's position in the ongoing collective bargaining negotiations
with the union. 204 N.L.R.B. at 41 n.2, 42-43. Thrift Drug thus did not
present the question "whether an employer may or may not lock out its
employees in a unit for the purpose of bringing economic pressure to bear
on the employees to accept the employer's collective-bargaining position"
(id. at 43), which is the issue in this case.
CONCLUSION
The petition for a writ of certiorari should be denied.
Respectfully submitted.
SETH P. WAXMAN
Solicitor General
LEONARD R. PAGE
General Counsel
NORTON J. COME
Deputy Associate
General Counsel
JOHN EMAD ARBAB
Attorney
National Labor Relations
Board
NOVEMBER 2000
1 The same principles apply to alleged violations of Section 8(a)(1) when,
as is generally the case, the Section 8(a)(1) claim is derivative of a claim
under Section 8(a)(3). See NLRB v. Fleetwood Trailer Co., 389 U.S. 375,
378 (1967); see also Great Dane Trailers, 388 U.S. at 30, 32.
2 The Board found that CIPS violated Section 8 by terminating health insurance
coverage and failing to pay certain workers' compensation benefits during
the lockout, and by failing to provide information Local 702 requested.
These violations, however, did not support an inference that the lockout
was motivated by unlawful considerations. Pet. App. 36a-40a. CIPS did not
appeal the Board's findings that CIPS violated Section 8 in these respects.
3 For the same reason, this case is not governed by NLRB v. Transportation
Management Corp., 462 U.S. 393 (1983). See Pet. 14 n.7. That case addressed
situations in which "a discharge or other adverse action [was] based
in whole or in part on antiunion animus." 462 U.S. at 401.