The HONORABLE RICHARD G. KOPF, United States District Judge 1

for the District of Nebraska, sitting by designation.

United States Court of Appeals

FOR THE EIGHTH CIRCUIT

___________

No. 96-2904

___________

National Labor Relations *

Board, *

*

Petitioner, * Petition for Review of the 

* Decision and Order of the

v. * National Labor Relations Board.

*

Swift Adhesives, Division of *

Reichhold Chemicals, Inc., *

*

Respondent. *

___________

 Submitted: February 14, 1997

 Filed: April 14, 1997

___________

Before BOWMAN and WOLLMAN, Circuit Judges, and KOPF, District 1

Judge.

___________

WOLLMAN, Circuit Judge.

The National Labor Relations Board (Board) found that Swift Adhesives

(Swift) violated sections 8(a)(1) & 8(a)(3) of the National Labor Relations

Act (the Act), 29 U.S.C. §§ 158(a)(1) & (a)(3), by withholding accrued

vacation benefits of former employees who were terminated following their

participation in a strike in the fall of 1993. The Board ordered Swift to

pay the accrued vacation benefits. We grant the Board’s petition for

enforcement of the order.
United Food & Commercial Workers Union, Local 576. 2

-2-

I.

Under the terms of the collective bargaining agreement in effect

during pre-strike 1993, employees who had been employed 196 calendar days

were eligible for vacation benefits. Vacation was to be taken the

following calendar year, but employees terminated for any reason could

receive the vacation benefits for which they had become eligible. This

agreement expired on September 30, 1993, and the employees began a strike

on October 1, 1993, after negotiations reached impasse. All striking

employees had become eligible for benefits under the expired agreement

prior to the strike. 

On January 4, 1994, the Union requested that Swift pay the striking 2

employees for their earned vacation days. Swift refused to pay unless the

employee had actually worked 196 days in 1993, asserting that the 196

actual-days-worked requirement was part of Swift’s final offer after

impasse and was therefore the relevant governing term. Accordingly, Swift

paid vacation benefits to seven employees who had actually worked 196 days

in 1993, but denied vacation pay to fifteen employees who had been employed

for, but had not actually worked, 196 days.

A hearing was held before an administrative law judge (ALJ), who

determined that Swift had violated the Act by refusing to pay the

accumulated vacation benefits. The Board affirmed, finding that the

employees had accrued vacation benefits, that the denial of those benefits

was a direct result of the strike, and that Swift had failed to establish

a legitimate and substantial business reason for denying the accrued

vacation benefits.
-3-

II.

We review the Board’s order with great deference and will enforce the

order if the Board correctly applied the law and if its findings of fact

are supported by substantial evidence on the record as a whole. See Town

& Country Elec., Inc. v. NLRB, 106 F.3d 816, 819 (8th Cir. 1997); Universal

Camera Corp. v. NLRB, 340 U.S. 474, 490-91 (1951); 29 U.S.C. § 160(e).

The Supreme Court has outlined the framework by which a violation of

sections 8(a)(3) and (1) of the Act may be established. First, the Board

must show “that the employer engaged in discriminatory conduct which could

have adversely affected employee rights to some extent.” NLRB v. Great

Dane Trailers, Inc., 388 U.S. 26, 34 (1967). Once this has been proved,

the employer must establish “legitimate objectives” for taking the

complained-of action. See id.

An employer’s discriminatory conduct can be shown by establishing

that the employees’ benefits were accrued and that the denial of payment

was apparently based on the employees’ participation in a strike. See

Texaco, Inc., 285 N.L.R.B. 241, 245 (1987). Benefits are accured if they

were “‘due and payable on the date on which the employer denied them.’”

Conoco, Inc. v. NLRB, 740 F.2d 811, 814 (10th Cir. 1984) (quoting E.L.

Wiegand Div., Emerson Elec. Co. v. NLRB, 650 F.2d 463, 469 (3d Cir. 1981)).

The striking employees had all been employed at Swift for at least 196

calendar days, the only requirement for eligibility under the pre-strike

agreement. Moreover, that agreement provided that an employee terminated

for any reason was entitled to receive the vacation benefits for which they

had become eligible. These facts constitute substantial evidence

supporting the Board’s conclusion 
Swift argues that the fact that it paid vacation pay to the 3

seven employees who qualified under the new contract shows that

it did not discriminate against strikers. This argument is

unpersuasive, however, for it fails to rebut the fact that Swift

treated the employees differently before and after the strike.

-4-

that the vacation benefits were due and payable. See Great Dane, 388 U.S.

at 32 (vacation benefits were accrued because employees met conditions

specified in expired employment contract, despite fact employees were

striking on date benefits could be claimed).

Likewise, substantial evidence supports the Board’s conclusion that

Swift’s denial of accrued vacation benefits was apparently based on the

employees’ participation in the strike. When all employees strike, as

here, discrimination against striking employees lies in a difference in

treatment between the employees’ treatment before and after the strike.

See Kansas City Power & Light Co. v. NLRB, 641 F.2d 553, 557 (8th Cir.

1981). Had the employees quit, been fired, or died before the strike they

would have been entitled to their vacation pay. 

Swift’s action could adversely affect the employees’ rights. Its

conduct, when “considered from a common sense point of view, is bound to

have a discouraging effect on present and future concerted activities,” for

the consequence is that employees cannot strike without placing their

accrued vacation pay in jeopardy. See id. at 559; see also Great Dane, 388

U.S. at 32 (“There is little question but that the result of [a] company’s

refusal to pay vacation benefits to strikers [is] discrimination in its

simplest form.”).3

The Board rejected Swift’s explanation that it was entitled to

unilaterally assert new terms regarding the accrued vacation benefits once

negotiations reached impasse. The Board concluded that already-accrued

vacation benefits were a non-mandatory subject 
-5-

of bargaining for which Swift could not unilaterally implement terms. The

rule that wages, hours, terms and conditions of employment are mandatory

subjects of bargaining for which employers may unilaterally implement terms

after impasse does not include accrued wages and benefits that are due and

owing, as these items are debts arising out of contracts already concluded.

See R.E. Dietz Co., 311 N.L.R.B. 1259, 1266 (1993). The Board’s

determination of the non-mandatory nature of accrued benefits “has

reasonable basis in law and is not inconsistent with the structure of the

Act.” LaTrobe Steel Co. v. NLRB, 630 F.2d 171, 176 (3d Cir. 1980)

(standard of review) (citing Ford Motor Co. v. NLRB, 441 U.S. 488, 497

(1979)). Thus, the Board did not misapply the law in determining that

Swift’s right to impose terms relating to mandatory subjects of bargaining

after impasse did not constitute a legitimate and substantial reason for

retroactively denying accrued vacation benefits. 

Swift contends that its desire to ensure that employees work a

significant portion of the year before receiving vacation benefits

justified its action. Although this purported justification might

constitute a legitimate reason for changing the vacation benefits policy

prospectively, it fails to justify denying benefits already accrued. Thus,

the Board did not err in finding that Swift had failed to show that its

denial of vacation benefits was based on a legitimate business objective.

The Board’s order is enforced.
-6-

A true copy.

Attest:

CLERK, U. S. COURT OF APPEALS, EIGHTH CIRCUIT.