ENSIGN ELECTRIC DIVISION OF HARVEY HUBBLE INCORPORATED AND UNITED
STEELWORKERS OF AMERICA, LOCAL 5925, AFL-CIO-CLC, PETITIONERS V.
NATIONAL LABOR RELATIONS BOARD

   No. 86-334

   In the Supreme Court of the United States

   October Term, 1986

   On Petition For A Writ Of Certiorari To The United States Court Of
Appeals For The Fourth Circuit

   Brief For The National Labor Relations Board In Opposition

            TABLE OF CONTENTS
   Opinions below
   Jurisdiction
   Questions presented
   Statement
   Argument
   Conclusion

                            OPINIONS BELOW

   The opinion of the court of appeals (Pet. App. 1a-8a) is reported
at 767 F.2d 1100.  The decision of the court of appeals on rehearing
(Pet. App. 9a-14a) is reported at 783 F.2d 1121.  The decision and
order of the National Labor Relations Board (Pet. App. 17a-28a) are
reported at 268 N.L.R.B. 620.

                             JURISDICTION

   The judgment of the court of appeals (Pet. App. 15a) was entered on
February 19, 1986.  A petition for rehearing and suggestion for
rehearing en banc was denied on April 1, 1986 (Pet. App. 16a).  On
June 25, 1986, Chief Justice Burger extended the time for filing a
petition for a writ of certiorari to and including July 28, 1986 (Pet.
App. 46a).  On July 23, 1986, Justice Brennan further extended the
time for filing a petition for a writ of certiorari to and including
August 29, 1986 (Pet. App. 47a).  The petition for a writ of
certiorari was filed on August 29, 1986.  The jurisdiction of this
Court is invoked under 28 U.S.C. 1254(1).

                          QUESTIONS PRESENTED

   1. Assuming the question is properly presented, whether the court
of appeals erred in sustaining the National Labor Relations Board's
retroactive application of its decision in Gulton Electro-Voice, Inc.,
266 N.L.R.B. 406 (1983), which holds that preferential seniority may
not lawfully be extended to union officials who are not involved in
grievance processing or other similar on-the-job contract
administration duties.

   2. Whether bargaining unit employees waive their statutory right to
be free of discrimination that encourages union membership by
ratifying a collective bargaining agreement which grants
superseniority for purposes of layoff to union officers who have no
grievance handling or contract administration duties.

   3. Whether Section 10(b) of the Act, 29 U.S.C. 160(b), precludes
the Board from holding unlawful the enforcement of a superseniority
provision that was executed and first implemented more than six months
prior to the filing of an unfair labor practice charge.

                               STATEMENT

   1. Petitioner, United Steelworkers of America, Local 5925,
AFL-CIO-CLC, has negotiated collective bargaining agreements on behalf
of the employees of petitioner, Ensign Electric Division of Harvey
Hubble Incorporated (Ensign Electric), for many years.  Pet. App. 30a.
 These agreements traditionally have required that Ensign Electric lay
off employees with the least seniority whenever reductions-in-force
are necessary.  Id. at 30a-31a.  Since 1970, however, the agreements
have also provided that the "local union president, vice-president,
recording secretary, treasurer, and grievance committee shall have
preferential seniority in the event of layoff." Id. at 30a.  Thus,
when Ensign Electric had to lay off a large number of its employees
between March 1979 and April 1981, the extant collective bargaining
agreement (effective February 10, 1979 to October 1, 1981) required
Ensign Electric to retain the union's president, recording secretary,
and treasurer, even though these employees had less "natural or
earned" seniority than other employees being laid off at the time.
Id. at 30a-31a.  Of these three union officers, only the union
president had on-the-job contract administration or grievance
processing responsibilities.  Id. at 31a-34a.

   2. One of the employees laid off during the March 1979-April 1981
period subsequently filed an unfair labor practice charge with the
National Labor Relations Board (Board), /1/ claiming that the
preferential seniority clause in effect at the time of his layoff was
unlawful.  Pet. App. 10a.  The Board agreed.  Id. at 17a-28a.  It
found that Ensign Electric had violated Section 8(a)(1) and (3) of the
National Labor Relations Act, 29 U.S.C. 158(a)(1) and (3), and that
the union had violated Section 8(b)(1)(A) and (2) of the Act, 29
U.S.C. 158(b)(1)(A) and (2), by "maintaining and enforcing the
superseniority clause with respect to the recording secretary and
treasurer during * * * (the) March 1980 to April 1981 layoff periods,"
and by laying off "employees who would not have been affected if the
collective bargaining agreement had not accorded * * * (the recording
secretary and treasurer) superseniority * * *." Pet. App. 19a-20a.

   In so holding, the Board followed (Pet. App. 19a) its earlier
decision in Gulton Electro-Voice, Inc., 266 N.L.R.B. 406 (1983),
enforced sub nom. Local 900, Int'l Union of Electrical Workers v.
NLRB, 727 F.2d F.2d 1184 (D.C. Cir. 1984).  The Gulton decision, which
overruled the Board's prior decision in United Electrical Workers,
Local 623, 230 N.L.R.B. 406 (1977), enforced sub nom. D'Amico v. NLRB,
582 F.2d 820 (3rd Cir. 1978), had held that, while "(i)nsuring the
enforcement of the collective bargaining agreement by retaining on the
job union representatives responsible for processing grievances is a
sufficiently compelling reason to allow limited superseniority with
respect to layoff and recall to those who perform steward-like
duties(,) * * * the stewards' need to maintain an on-the-job presence
does not generally apply to officers (and) thus the justification used
for stewards does not extend to officers generally -- unless the
latter perform steward-like duties." Gulton Electro-Voice, Inc., 266
N.L.R.B. at 408.  Applying that rationale to the instant case, the
Board found that the superseniority clause in petitioners' collective
bargaining agreement was unlawful because it did not limit layoff and
recall protection to union officers with on-the-job contract
administration or grievance handling responsibilities.  Pet. App.
19a-20a.

   The Board also rejected petitioners' claim that the "6-month
limitation proviso to Sec(tion) 10(b) of the Act" immunized this
superseniority clause from the Board's scrutiny.  Pet. App. 19a-20a &
n.8.  Though the clause had been ratified and first implemented more
than six months before the filing of the unfair labor practice charge
(ibid.), the Board found that "the consolidated complaint does not
attack the execution of the contract * * * " (ibid.), but rather "only
the * * * maintenance and enforcement of (the) superseniority clause
within the applicable (six-month) period * * * ." Ibid.  Accordingly,
the Board found petitioners' "exceptions lacking in merit" (ibid.) and
ordered, inter alia, that Ensign Electric reinstate the individuals
who had been laid off between March 17, 1980, the date on which the
six-month period commenced, and April 10, 1981, the date on which
layoffs ceased, and that petitioners jointly and severally make those
individuals whole for any resultant loss of earnings.  Id. at 21a-23a,
25a.

   3. The court of appeals upheld the Board's decision and enforced
its order.  Pet. App. 1a-8a.  It sustained the Board's retroactive
application of the Gulton decision (id. at 2a-5a & nn.1, 2), holding
that the "considerations governing retroactivity" of judicial and
administrative decisions are "strikingly similar" (id. at 4a n.1,
citing Chevron Oil Co. v. Huson, 404 U.S. 97 (1971), and Retail,
Wholesale and Department Store Union v. NLRB, 466 F.2d 380 (D.C. Cir.
1972)), and that, because "(t)he question of the extent to which
functional union officials (may) be insulated from lay-off in
preference to rank and file union members had been debated in a number
of cases with vocal dissents(,) * * * it could not * * * be() said
that the law was settled in such a way as to make unjust the
retroactive application of Gulton in the instant case." Pet. App.
2a-4a (footnotes omitted).  On rehearing, the court rejected
petitioners' claim that the six-month statute of limitations provision
rendered the preferential seniority clause of the February 10, 1979
agreement immune from challenge.  Id. at 9a-14a.  The court reasoned
that, "(s)ince the Ensign Electric * * * contract grants super
seniority (sic) to union officials solely because of their status as
union officials, (it) is unlawful on its face (and) no evidence
outside the terms of the contract is required to prove the unfair
labor practice * * *." Id. at 13a-14a.  In these circumstances, the
court held, Section "10(b) (of the Act) does not apply." Ibid.

                               ARGUMENT

   1. Petitioners first contend (Pet. 10-15) that the court below
erred in sustaining the Board's retroactive application of the Gulton
rule.  They do not dispute (id. at 10-11 & n.9) that other courts of
appeals have analyzed and decided the retroactivity question exactly
as the court below did.  See, e.g., NLRB v. Wayne Transp., A Div. of
Wayne Corp., 776 F.2d 745, 750-751 (7th Cir. 1985);  NLRB v. Niagara
Machine & Tool Works, 746 F.2d 143, 151 (2d Cir. 1984);  Local 900,
Int'l Union of Electrical Workers v. NLRB, 727 F.2d 1184, 1186-1189
(D.C. Cir. 1984).  Rather, petitioners contend (Pet. 11-15) that the
"balancing test" that these courts have employed -- which weighs the
statutory interest in retroactive application against the surprise and
hardship that will result -- is inappropriate where, as here, the
Board's new rule is only a "permissible," and not a "mandatory,"
construction of the Act.  This contention is not properly presented to
this Court for review and, in any event, is in error.

   The contention is not open to review by this Court because
petitioners have not complied with the requirement set forth in
Section 10(e) of the Act for obtaining judicial review.  Section 10(e)
provides that "(n)o objection that has not been urged before the Board
* * * shall be considered by the court, unless the failure or neglect
to urge such objection shall be excused because of extraordinary
circumstances." 29 U.S.C. 160(e).  "This Court has interpreted
(Section) 10(e) to mean that a Court of Appeals is 'without
jurisdiction to consider' an issue not raised before the Board if the
failure to do so is not excused by extraordinary circumstances." EEOC
v. FLRA, No. 84-1728 (Apr. 29, 1986), slip op. 4.  Indeed, the Court
has held that Section 10(e)'s requirements apply even where the Board
has raised an issue for the first time in its own decision;  in these
circumstances, Section 10(e) requires that the objecting party timely
present its objections to the Board in a petition for reconsideration
or rehearing.  See Woelke & Romero Framing, Inc. v. NLRB, 456 U.S.
645, 666 (1982);  Garment Workers v. Quality Mfg. Co., 420 U.S. 276,
281 n.3 (1975).  Therefore, since petitioners have never presented to
the Board their argument against retroactive application of the Gulton
rule, the court below lacked jurisdiction to consider that argument,
and this Court does as well.  /3/

   Furthermore, the petition for certiorari raises for the first time
in this case the claim that a discretionary construction of the Act
may never be applied retroactively.  In the court below, petitioners
urged only that the surprise and hardship to Ensign Electric and the
Union outweighed the statutory interest in retroactive application of
the Gulton rule;  petitioners did not argue below that retroactive
application of the Gulton rule was per se improper because the Gulton
rule reflects an exercise of discretionary authority by the Board.
Petitioners should not be permitted to raise this argument for the
first time in this Court.  See EEOC v. FLRA, slip op. 5;  FTC v.
Grolier, Inc., 462 U.S. 19, 23 n.6 (1983);  Youakim v. Miller, 425
U.S. 231, 234-235 n.5 (1976).

   In any event, there is no merit to petitioners' argument (Pet. 11
(emphasis in original)) that "a balancing test" for retroactive
application of a new rule is appropriate only where "a statute is
susceptible of only one 'correct' construction" and "the agency has
previously construed the statute erroneously to declare the conduct
unlawful," and not where "a statute is susceptible of two 'correct'
constructions, and the agency switches from one such construction to
the other." Petitioners cite no case holding that an agency
interpretation of a statute may not be applied retroactively unless
the interpretation is compelled.  /4/ Rather, as the courts of appeals
that have considered the retroactivity of Gulton have uniformly
concluded (see, in addition to the decision below, NLRB v. Wayne
Transp., A Div. of Wayne Corp., 776 F.2d at 750-751;  NLRB v. Niagara
Machine & Tool Works, 746 F.2d at 151;  Local 900, Int'l Union of
Electrical Workers v. NLRB, 727 F.2d at 1186-1189), while the nature
of the agency's decision may affect the interests to be balanced, the
problem remains one of balancing the public's legitimate interest in
having the prevailing interpretation of the statute apply
retroactively, see generally Retail, Wholesale & Department Store
Union v. NLRB, 466 F.2d at 390, against the hardship to the affected
party.

   2. Petitioners next contend (Pet. 15-17) that the bargaining unit
employees waived their right to be free of the discriminatory
superseniority clause when they ratified the collective bargaining
agreement containing that clause.  This contention is also without
merit.

   This Court has made clear that only "economic" rights may be waived
in a collective bargaining agreement.  See Metropolitan Edison Co. v.
NLRB, 460 U.S. 693, 705-706 (1983);  NLRB v. Magnavox Co., 415 U.S.
322, 325-326 (1974).  Thus, while statutory rights in the economic
sphere (such as the right to strike) may be waived by collective
agreement (see Mastro Plastics Corp. v. NLRB, 350 U.S. 270, 279
(1956)), statutory rights that ensure "the premise of fair
representation" are not subject to waiver.  Metropolitan Edison Co. v.
NLRB, 460 U.S. at 705-706;  see also Radio Officers' Union v. NLRB,
347 U.S. 17, 47-48 (1954).  And, as petitioners concede (Pet. 16-17),
every court of appeals to consider the issue has held that
superseniority for union officials undermines rights that ensure "the
premise of fair representation" and, accordingly, cannot be defended
on the basis of waiver.  See, e.g., Local 1384, UAW v. NLRB, 756 F.2d
482, 494 (7th Cir. 1985);  NLRB v. Local 1131, 777 F.2d 1131, 1139
(6th Cir. 1985);  NLRB v. Niagara Machine & Tool Works, 746 F.2d at
150;  Local 900, Int'l Union of Electrical Workers v. NLRB, 727 F.2d
at 1190.

   These courts of appeals have clearly reached the correct
conclusion.  "The Board has declared superseniority for officers not
involved in on-the-job administration of the collective bargaining
agreement to be unlawful not because it impairs the natural seniority
rights of employees but because it impairs their right to be free of
discrimination that encourages union activism." Local 1384, UAW v.
NLRB, 756 F.2d at 494.  "Superseniority presumably encourages
employees to become active supporters of the incumbent union in the
hope that their efforts will win them union office and, thereby,
greater job security." Local 900, Int'l Union of Electrical Workers v.
NLRB, 727 F.2d at 1190.  This is precisely the kind of coercive
conduct that this Court has said cannot be justified by waiver.  See
NLRB v. Magnavox Co., 415 U.S. at 325-326;  Radio Officers' Union v.
NLRB, 347 U.S. at 47-48.  Petitioners' contention to the contrary
(Pet. 16-17) finds no support in the case law.  /5/

   3. Finally, petitioners argue (Pet. 17-18) that the court below
erred in holding that Section 10(b) of the Act does not preclude the
Board from holding unlawful the enforcement of a superseniority
provision that was executed and first implemented more than six months
prior to the filing of an unfair labor practice charge.  This argument
is also in error.

   Section 10(b) of the Act provides that "no complaint shall issue
based upon any unfair labor practice occurring more than six months
prior to the filing of the charge * * *" (29 U.S.C. 160(b)).  This
section plainly does not mean that, unless the first instance of
unlawful conduct is challenged within six months, all later related
unlawful actions are immunized from Board sanction.  Here, the only
conduct found unlawful -- the maintenance and enforcement of the
superseniority clause during the March 1980 to April 1981 layoff
period -- occurred during the six-month period preceding (and the
seven-month period succeeding) the filing of the unfair labor practice
charge.  See Pet. App. 19a-20a & n.8.  The Board did not hold unlawful
either the execution of the contract or the first exercise of the
superseniority clause.  See ibid.  Accordingly, since the contract was
unlawful on its face (see page 13, infra), the court below clearly did
not err in rejecting petitioners' claim that Section 10(b) barred any
finding of liability in this case.  See Local Lodge No. 1424, IAM v.
NLRB, 362 U.S. 411, 422 n.14, 423 (1960);  NLRB v. Local 1131, 777
F.2d at 1139-1140.

   Petitioners' claim (Pet. 18) that the decision below conflicts with
the decision of the Fifth Circuit in NLRB v. Auto Warehousers, Inc.,
571 F.2d 860 (1978), is wrong.  In Auto Warehousers, Inc., the
contract clause at issue was not unlawful on its face;  although the
clause purported to grant preferential seniority to stewards, the
preference was not automatic, but rather depended upon a union's
request and the employer's approval.  These actions, which constituted
the unlawful activity, occurred more than six months before the
charge.  571 F.2d at 862-864.  By contrast, the contract clause at
issue here expressly discriminated against employees for "union
related" reasons;  under Gulton, it was unlawful on its face and
constituted a continuing violation of the Act.  /6/ For that reason,
the court below (see Pet. App. 13a) correctly found that the Auto
Warehousers, Inc. decision is distinguishable.  /7/

                              CONCLUSION

   The petition for a writ of certiorari should be denied.

   Respectfully submitted.

   CHARLES FRIED

      Solicitor General

   ROSEMARY M. COLLYER

      General Counsel

   JOHN E. HIGGINS, JR.

      Deputy General Counsel

   ROBERT E. ALLEN

      Associate General Counsel

   NORTON J. COME

      Deputy Associate General Counsel

   LINDA SHER

      Assistant General Counsel

   JOHN BURGOYNE

      Attorney National Labor Relations Board

   OCTOBER 1986

   /1/ The employee filed this charge on September 15, 1980, over 12
months after the preferential seniority clause of the February 10,
1979 agreement was first exercised on August 31, 1979.  Pet. App. 10a.
 The Board's General Counsel issued a complaint on November 4, 1980
concerning this charge.  Ibid.  The General Counsel, however, amended
his complaint on June 10, 1981, to cover the claims of employees laid
off at the time the union's treasurer exercised his right to
preferential seniority on April 10, 1981.  Ibid.

   /2/ Judge Haynsworth dissented as to the retroactivity and
limitations period issues.  Pet. App. 6a-8a, 14a.

   /3/ Although the Board briefed and argued the Section 10(e) issue
in the court below (see Br. 30-31 (filed Dec. 13, 1984)), the court
decided the Gulton retroactivity question without addressing the
Section 10(e) issue.  See Pet. App. 2a-5a.

   Two other courts of appeals have explicitly determined that Section
10(e) does not bar courts from determining whether the Gulton decision
applies retroactively.  See Local 900, Int'l Union of Electrical
Workers v. NLRB, 727 F.2d at 1191-1194;  NLRB v. Wayne Transp., a Div.
of Wayne Corp., 776 F.2d at 748-750.  These courts found that, because
the Board may have reason to be aware that unions will object to
retroactive application of the Gulton rule, Section 10(e)'s policies
do not require a bar to judicial review.  This reasoning, however,
does not suffice to remove Section 10(e)'s jurisdictional barrier.

   Moreover, Section 10(e) requires that parties present the Board
with both their objections and their reasons for maintaining these
objections.  It does so in order that the Board may "bring() its
expertise to bear on the resolution of (the) issues" and efficiently
reach fair and informed decisions.  EEOC v. FLRA, slip op. 4.  As
noted in the text, this requirement applies even where the Board has
already issued a holding concerning a particular matter;  the
objecting party must still file a petition for reconsideration or
rehearing with the Board to satisfy the restrictions that Section
10(e) places on the jurisdiction of the courts.  Woelke & Romero
Framing, Inc. v. NLRB, 456 U.S. at 666.  The policies underlying
Section 10(e) remain applicable even when the Board knows that a party
is likely to object to a particular resolution of an issue;  the Board
still needs to know the particular reasons for objection.

   /4/ The cases that petitioners do cite suggest, to the contrary,
that the relevant interests are to be balanced.  See SEC v. Chenery
Corp., 332 U.S. 194, 203 (1947) (emphasis added) (the "ill effect of
the retroactive application of a new standard" must be "balanced
against the mischief of producing a result which is contrary to a
statutory design or to legal and equitable principles");  NLRB v. Bell
Aerospace Co., 416 U.S. 267, 295 (1974) (emphasis added) (the question
is whether "the adverse consequences ensuing from such reliance are so
substantial that the Board should be precluded from reconsidering the
issue in an adjudicative proceeding");  Heckler v. Community Health
Services, 467 U.S. 51, 60 n.12 (1984) (emphasis added)
("administrative agency may not apply a new rule retroactively when to
do so would unduly intrude upon reasonable reliance interests").

   /5/ Petitioners' claim (Pet. 17) that there is an "apparent
inconsistency" between the decisions of the courts of appeals and this
Court's decision in Metropolitan Edison Co. v. NLRB, 460 U.S. 693
(1983), is wide of the mark.  In Metropolitan Edison Co., the Court
held that a union may waive the right of union officials to refrain
from taking affirmative steps to end unlawful work stoppages because
that right is "closely related to the economic decision a union makes
when it waives its members' right to strike" (460 U.S. at 706).  By
its own terms, however, the decision in Metropolitan Edison Co. does
not apply where noneconomic rights -- such as the right to be free of
discrimination that encourages union membership -- are involved.  See
id. at 705-706;  see also Local 1384, UAW v. NLRB, 756 F.2d at
494-495;  Local 900, Int'l Union of Electrical Workers v. NLRB, 727
F.2d at 1190.

   Petitioners' suggestion (Pet. 17 n.17) that the Board's decision in
Gem City Ready Mix Co., 270 N.L.R.B. 1260 (1984), is inconsistent with
its decision here is also erroneous.  In Gem City, the Board held that
a union, as part of the settlement of an economic strike, may waive
the seniority rights of its supporters.  These rights may be waived
because the employees' interests "coincide," and do not "conflict,"
with the union's interests.  NLRB v. Niagara Machine & Tool Works, 746
F.2d at 150-151.  By contrast, "(s)uperseniority (for union officials)
serves the union's interest in encouraging employees to be 'good,'
active union members" and directly conflicts with the employees' right
to be free of such encouragement.  Id. at 150.  Thus, Gem City is
consistent with the Board's position here.

   /6/ Contrary to petitioners' suggestion (Pet. 18), the preferential
seniority clause is in fact "unlawful on its face." The clause "grants
super seniority (sic) to union officials solely because of their
status as union officials." Pet. App. 12a-13a.  No inquiry into the
union officers' duties is necessary in order to find this clause
unlawful.  Accord NLRB v. Local 1131, 777 F.2d at 1139, 1140.  The
clause is overinclusive on its face and thus infringes upon employees'
right to refrain from union activities.  See International Harvester
Co., 268 N.L.R.B. 966 (1984);  United States Steel Corp., 268 N.L.R.B
1187 (1984).  Accordingly, it is per se unlawful under Gulton.  Pet.
App. 12a-14a;  accord, NLRB v. Local 1131, 777 F.2d at 1140 (reaching
the same conclusion and distinguishing Auto Warehousers, Inc. on this
basis).

   /7/ The court also pointed out (Pet. App. 13a) that preferential
seniority clauses were only presumptively unlawful when the Auto
Warehousers, Inc. case was decided.  Under Gulton, of course, such
clauses are per se unlawful whenever they do not, by their own terms,
make the grant of preferential seniority dependent on the union
officers' duties.  See NLRB v. Local 1131, 777 F.2d at 1140.