Opinion ID: 358967
Heading Depth: 3
Heading Rank: 2

Heading: The Preferred Approach to the Duty to Bargain

Text: 51 Having rejected a Per se analysis of the duty to bargain about a partial closing, we necessarily encounter the task of elaborating an alternative. In considering a broader approach, we must contemplate the theory of collective bargaining embodied in the NLRA: a commitment to the efficacy of a framework of discussion and compromise between the parties to labor disputes. Direct negotiations by the disputants is viewed as helpful both to the nation, which thereby can be spared to some extent the disruptive products of a lack of communication between labor and management, and to the participants themselves, who thereby are put in a position of listening to the other side and understanding, if not agreeing, with the opposing view. 52 In the abstract, the aims of collective bargaining would be furthered by requiring an employer to negotiate with a union before deciding irrevocably to close down a plant. Such a requirement would lead to some discussion however brief it may be between the parties, and would allow them in advance of a Fait accompli by one or the other to comprehend the factors motivating each of them. It would at least help foster respect for the role of each side as a subject in the controversy, and not as a mere object to be treated in accordance with the other's will. It would, in short, tend to promote the realization of the NLRA's basic purpose, which is to advance the peaceful resolution of disputes in industrial relations. 85 53 Further, the act of closing a plant appears to come within the literal language of the statute in that it concerns terms and conditions of employment. This is so for the same reason expressed in Fibreboard in support of the proposition that the subcontracting decision there came within the ambit of the statutory phraseology namely, it usually, and rather quickly, leads to the termination of at least some employees. As Fibreboard stated: 54 The subject matter of the present dispute is well within the literal meaning of the phrase 'terms and conditions of employment.' . . . A stipulation with respect to the contracting out of work performed by members of the bargaining unit might appropriately be called a 'condition of employment.' The words even more plainly cover termination of employment which, as the facts of this case indicate, necessarily results from the contracting out of work performed by members of the established bargaining unit. (emphasis supplied) 86 55 Just as subcontracting is likely to lead to the termination of employment, so, too, will the closing down of an employer's plant and thus the latter act might appropriately be called a 'condition of employment'. 56 Accordingly, it would seem that there is an initial presumption, founded on statutory purposes and language, that a partial closing is a mandatory subject of bargaining. However, as earlier pointed out, any such presumption should not be construed as a Per se rule, as the dissent appears to do. Rather, the main point is that there seems to be no justification for drawing any bright line between a partial closing situation, as to which there is decisional disagreement regarding the duty to bargain, and the subcontracting situation of Fibreboard, where the Supreme Court held that there was a duty to bargain. With regard to both matters, bargaining would serve an important statutory function. 57 The next and crucial step in the analysis, following the lead of Fibreboard, is to focus on the facts of each case in determining whether there is a duty to bargain about the decision to close a plant. Such a particularistic inquiry is especially salutary as a practical matter since it directs the court's attention to the interests of each of the parties. 58 Of chief concern to the employees is the prospect of losing their jobs. It is in fact difficult to imagine any result of a decision by the employer about which labor would be more highly sensitized. 87 59 Because of that, it seems realistic, as Fibreboard indicated, to suppose that the union would endeavor in the course of discussion to seek to persuade the employer to alter its decision to close the plant. 88 In particular, to the extent that Brockway's decision to shut down one of its facilities is the result of high costs of production, it is possible that the union might agree to changes that would reduce labor expenses and thereby alter the calculation that led to the employer's determination in the first place. Indeed, labor history is replete with instances where a union has cooperated actively with an employer to keep a company financially afloat and thus to prevent the closing of a facility and the loss of jobs. For example, in the clothing industry, representatives of labor have acted to help employers who were in trouble and whom the union wished to save. 89 Also, the steel industry has witnessed the cooperative spirit of labor in union-sponsored programs to reduce the cost of production and to return a percentage of wages to the employer as a loan to the company. 90 60 Even if the union does not undertake such acts in bargaining about the decision to close the plant, it might still be able to avert the closing by convincing the employer that such a step would cost it more in terms of post-termination expenses, as in severance pay, than it would save. And even if the employer were to remain intransigent, the union could at least attempt to make suggestions about the decision's timing and implementation in order to moderate the closing's impact on the work force. 91 61 It might be said, in response, that the union's interest in being able to bargain about the employer's decision does not have the same weight in this case as it did in Fibreboard, since the decision to close one of Brockway's facilities is of a different sort than the determination to contract out unit work. For, so it might be argued, the present choice implicates complex issues of a managerial nature about which labor has no expertise and therefore cannot be expected to make constructive suggestions in the course of bargaining. 62 The weakness of such an argument is that it paints with too broad a brush. Like any important action by an employer, including that of subcontracting, the decision to close a portion of an employer's operations has many components. With regard to some aspects of an employer's decision, the union perhaps may not be an expert or, even, a particularly helpful interlocutor. But that observation does not in any way defeat the proposition that with respect to other aspects of such a determination especially those bearing upon the production costs of labor and the labor-related expenses involved in carrying the decision into effect the union is fully apprised of relevant and important facts, and could well make a contribution that might enable the employer to keep the plant in question economically viable. 92 63 As Fibreboard pointed out, one indicator that bargaining might be useful is the frequency with which parties to labor-management contracts include clauses in their agreements bearing on such a matter. 93 In Fibreboard, the Supreme Court referred to a Department of Labor report indicating that about one-fourth of the contracts reviewed had some form of limit on subcontracting. 94 Similarly, it would seem apposite here to note that a Department of Labor study shows that about 21.5% Or slightly more than one-fifth, of the contracts under consideration contained a clause dealing with the closing of a plant or its removal from its present location. 95 Although such statistics are not determinative, they are indicative that the decision to shut down a facility like Brockway's plant in Philadelphia is the sort of matter as to which bargaining may well be helpful. 64 The fact that collective bargaining agreements often include clauses dealing with a plant closing or removal might be said to indicate that there is less of a need to impose a Statutory duty to bargain about that subject. However, even assuming that this is a valid argument in general, it misses the mark in the present case, for the contract between the parties here even if it contained such a provision, and the record includes no evidence one way or the other had lapsed at the time that the employer unilaterally decided to close the facility. In addition, Fibreboard does not permit the conclusion that the relatively common appearance of contractual clauses about a certain subject makes the statutory duty to bargain about it any less important. To the contrary, Fibreboard stated that the frequent appearance of contractual provisions covering a specific subject constitutes affirmative evidence that such a subject is the type of issue as to which bargaining should be thought useful. 96 65 It is, of course, not enough to say that the employees have a strong interest in bargaining and that bargaining may well be efficacious; it is also appropriate to consider closely the employer's countervailing interests. In this case, Brockway argues that its freedom to determine the company's direction would be excessively hindered by holding that it has a duty to bargain about the decision to close the plant. 97 66 We cannot accept the employer's suggestion that imposing on it a duty to bargain would necessarily strip it of its management prerogative. Nothing in a holding that the employer has a duty to bargain about the partial closing by itself would impinge on the employer's freedom ultimately to determine whether to close the facility. Rather, all that such a conclusion would require is that the two sides discuss the matter at the bargaining table. Should the parties fail to reach an agreement, Brockway could then go ahead with its plan to close the plant. 98 67 Additionally, the record here is devoid of support for the employer's assertion that its freedom would be unacceptably constrained by bargaining. Specifically, there is no evidence to suggest that bargaining about the decision to close would be fruitless or unfair to the employer, either because of an action by some third party such as a condemnation of the employer's property by a municipal housing authority, as in Royal Plating 99 or of the dire financial straits of the company. There is, for instance, nothing in the record indicating a history of severe losses on the part of Brockway. At oral argument, Brockway's counsel conceded that there was no evidence that the firm was in financially straitened circumstances or that it was economically required to shut down the Philadelphia facility. 100 Nor is there any indication in the record of the need to restructure the company in order for it to remain in business. 101 There is also not the slightest hint that management negotiations with another entity, such as a potential partner, purchaser or other party, would be disrupted or made substantially more difficult by holding that the partial closing is a mandatory subject of bargaining. 102 The contention that Brockway's managerial position would be unacceptably hampered by imposing a duty to bargain about the decision to close the plant is thus, in the end, merely a speculative assertion unsupported by the evidence. 68 Brockway's argument comes down to the proposition that the stipulation that the partial closing was due to economic considerations is, in itself, sufficient to forestall imposition of the duty to bargain. Such a contention presumes that there exists a rule that an employer need not bargain about a partial closing so long as there is no anti-union animus and whenever the decision is induced by economic considerations, regardless of the nature of such considerations. As we have noted, not only is there no such Per se rule in this Circuit, but also it is contrary to the analysis of Fibreboard. 103 Moreover, it is inconsistent with the purpose of the NLRA, which is to establish a framework of bargaining so as to allow for the peaceful resolution of industrial controversies and, additionally, to foster the dissipation of labor disagreements before they become open disputes. 104 69 To conclude that Brockway was not under an obligation to bargain solely because its decision was based on unspecified economic considerations might well disrupt the structure of collective bargaining contemplated by the NLRA. It would unduly diminish the scope of the employer's public duty by overly protecting the assertion of its private interest. And it would predictably chill future bargaining by the employees' representatives who would have reason to fear that, in response to aggressive negotiation, an employer could simply shut down one of its plants and be protected by an exclusion from the responsibility of bargaining about that decision. 70 Yet, just as we decline to say that there is no duty to bargain when a decision to close is based on unspecified economic considerations, it likewise appears inappropriate to enforce an order predicated on an unfair labor practice when we do not know with specificity what the circumstances surrounding the employer's decision to close its facility actually were. The somewhat enigmatic phrase, economic considerations, is of little help in the process of ascertaining whether the employer's interests in this case were in fact of a magnitude and immediacy that would make unacceptable and unfair the imposition of a duty to bargain. 71 Because the precise nature of the conditions leading to Brockway's decision is not known, we do not have the desirable, firm factual underpinning necessary to utilize the balancing approach enunciated in this opinion. For that reason, we shall not at this time enforce the Board's order relating to an unfair labor practice by Brockway. 105