Legal Document

452 U.S. 666 101 Supreme Court Reporter 2573 69 United States Reports Lawyer’s Edition 2d Series KF101.8 U54 318 FIRST NATIONAL MAINTENANCE CORPORATION, Petitioner,v.NATIONAL LABOR RELATIONS BOARD. Number 80-544. Argued April 21, 1981. Decided June 22, Syllabus Petitioner, a company engaged in the business of providing housekeeping, cleaning, maintenance, and related services for commercial customers, had contract to do maintenance work nursing home. As result dispute with home over size management fee, petitioner terminated contract, petitioner's employees who worked at were discharged. While was still effect, labor union certified as bargaining representative The union, upon learning intention discharge these employees, requested delay from purpose but refused bargain. then filed an unfair practice charge against petitioner, alleging violation its duty bargain good faith "with respect wages, hours, other terms conditions employment" under §§ 8(d) 8(a)(5) National Labor Relations Act. Board upheld ordered if it agreed resume operations, reinstate discharged or, agreement not reached, offer equivalent jobs operations. Appeals enforced Board's order, holding that while no per se rule could be formulated govern employer's decision close part business, § creates presumption favor mandatory such decision, which is rebuttable by showing purposes NLRA would furthered imposing Held : Although required about effects terminate contract. facts Fibreboard Paper Products Corporation versus NLRB, 379 203, 85 398, 13 233, distinguished. Pp. 674-6887. (a) In view need unencumbered decisionmaking conduct decisions have substantial impact on continued availability employment should only benefit, labor-management relations collective-bargaining process, outweighs burden placed business. 674-680. (b) harm likely done operate freely deciding whether shut down purely economic reasons incremental benefit might gained through union's participation making decision. itself 8(d)'s "terms Congress has mandated bargaining. 680-686. 627 Federal Reporter, 2nd 596, reversed remanded. Sanford E. Pollack, Hewlett, N.Y., petitioner. Norton Judge Come, Washington, D.C., respondent. Justice BLACKMUN delivered opinion Court. 1 Must employer, employment," Act (Act), amended, 49 Statutes-at-Large 452, 29 Code KF62 158(d) 158(a)(5), negotiate business? this case, (Board) imposed customer, Appeals, although differing appropriate rationale, order. 2 * First Maintenance (FNM), New York corporation customers City area. It supplies each customer's premises, contracted-for force supervision return reimbursement costs (gross salaries, FICA FUTA taxes, insurance) payment set fee. contracts hires personnel separately does transfer between locations.1 3 During spring 1977, performing Greenpark Care Center, Brooklyn. Its written dated 28, 1976, specified "shall furnish all tools, equiptment [sic ], materials, supplies," pay weekly "the sum five hundred dollars plus gross payroll fringe benefits." App. 79-4167 (CA2), Pages 43, 44. however, been reduced $250 effective November 1, 1976. Id., 46. prohibited hiring any during term 90 days thereafter. Petitioner employed approximately 35 workers operation. 4 Petitioner's relationship Greenpark, seemingly, very remunerative or smooth. March gave 30 days' notice cancellation because "lack efficiency." 52. This did become effective, FNM's after expiration 30-day period. became aware losing money Greenpark. On 30, telephone, asked fee restored $500 figure and, July 6, informed writing discontinue operations there August unless increase granted.2 47. By telegram 25, final termination. 48. 5 FNM experiencing difficulties, District 1199, Union Hospital Health Employees, Retail, Wholesale Department Store Union, AFL-CIO (union), conducting organization campaign among employees. 31, Board-conducted election, majority selected their agent.3 12, vice president, Edward Wecker, wrote notifying certification right bargain, stating: "We look forward meeting you your purpose. Please advise when will convenient." 49. neither responded nor sought consult union. 6 notified they three later. Wecker immediately telephoned secretary-treasurer, Leonard Marsh, request Marsh told termination operation matter money, final, provision made staying beyond prohibitively expensive. 79-81, 83, 85-86, 94. discussed Greenpark's same day, unable obtain waiver provision. 91-93, 98-99. also unwilling hire contract's 90-day limitation hiring. 100-101, 106-107. With nothing perfunctory further discussion, 31 discontinued 110-116. 7 violations Act's 8(a)(1) (5). After hearing held Regional Director's complaint, Administrative Law findings favor. Relying Ozark Trailers, Inc., 161 N.L.R.B. 561 (1966), he ruled failed satisfy concerning both effect change unit employees.4 judge reasoned: 8 "That man his hardly needs comment. obvious facts, law clear. When complement represented wishes alter arrangements, reason lack mere desire richer, less clear must first talk it. . If given opportunity talk, something out people parts [petitioner's] Entirely apart open discussion parties—with speaking behalf right—might persuaded [petitioner] find way continuing always possibility use continue doing work, either direct later replacement contractor." 242 462, 465 (1979).5 9 recommended order requiring service consequent well He recommended, also, backpay date until parties bargained agreement, reached impasse, timely bargaining, faith. 10 adopted Judge's without analysis, additionally reinstatement former equivalents; conversely, wasordered positions, available subsequently hired necessary, 463. 11 Second Circuit, one dissenting part, analysis different espoused Board. 596 (1980).6 reasoned Rather, court said, "by statute imposition bargain," example, demonstrating "bargaining futile," due "emergency financial circumstances," "custom industry, shown absence obligation typical collective agreements, decisions." 601-602. 12 Appeals' case appears odds Courts Appeals,7 some decline require involving "a major commitment capital investment" "basic operational change" scope direction enterprise,8 indicate 8(a)(3) (a partial closing motivated antiunion animus) involved.9 Fifth Circuit decisions. See NLRB Winn-Dixie Stores, 361 512, cert. denied, 385 935, 87 295, 17 215 (1966). fully consistent rulings applicable type decision.10 Because importance issue disagreement we granted certiorari. 449 1076, 854, 66 798 (1981). II 14 A fundamental aim establishment industrial peace preserve flow interstate commerce. Jones & Laughlin Steel Corp., 301 57 615, 81 L.Ed. 893 (1937). Central achievement promotion method defusing channeling conflict management.11 Act, 151. ensured go creating giving power condemn practices certain unions employers deemed deleterious including refusal "to collectively." 8, 153 158. 15 are free legal subject, limited mandate matters "wages, employment."12 unilateral subject within category violates statutory remedial Katz, 369 736, 82 1107, 230 (1962). Conversely, employer may impasse weapons disposal attempt secure respective aims. American insurance Co., 343 395, 72 824, 96 1027 (1952).13 deliberately left words definition, intend deprive define those light specific practices.14 16 Nonetheless, establishing what issues submitted process expectation elected equal partner running enterprise members employed. Despite deliberate open-endedness language, undeniable limit subjects take place: "Section 8(a) course, immutably fix list But establish proposed topics measured. general terms, includes settle aspect employees." Chemical Alkali Workers Pittsburgh Plate Glass 404 157, 178, 92 383, 397, 341 (1971). 18 Ford Motor 441 488, 99 1842, 60 420 (1979); 233 (1964); Teamsters Oliver, 358 283, 79 297, 312 (1959). 19 Some decisions, choice advertising promotion, product design, financing indirect attenuated relationship. Fibreboard, U.S., 223, S.Ct., 409 (STEWART, J., concurring). Other succession layoffs recalls, production quotas, rules, almost exclusively "an relationship" employee. Workers, 397. present concerns third employment, since inexorably eliminated termination, focus profitability concern wholly enterprise, akin all, "not [itself] primarily though necessarily employment." Cf. Textile Darlington 380 263, 268, 994, 998, 827 (1965) ("an absolute entire pleases"). At time, touches central pressing member employees: retention employees' jobs. Brockway Trucks 582 720, 735-736 (CA3 1978); 561, 566-568 20 contends contention requires determine considered retained freedom manage affairs unrelated employment.15 labeling rather than simply permitting, requiring, "promote bringing problem vital framework established most conducive peace," 211, 403. concept premised belief discussions backed parties' better society whole.16 500-501, 1851; Borg-Warner, 356 350, 78 723 (condemning proposal "ballot" clause weakening process). true, amenable resolution process. Management constraints process17 extent essential profitable degree certainty beforehand proceed reach fear evaluations practice. explicitly state mutual intended exclude bargaining.18 decisionmaking, 21 implicitly regard subcontract previously Holding relied "literal meaning" words, 22 "The Company's basic performed plant. 23 No investment contemplated; Company merely replaced existing independent contractor similar employment. Therefore, significantly abridge business." 213, 404. 24 emphasized reduce costs, "peculiarly suitable framework," id., 214, 404, base subcontract: 25 "It induced assurances contractors economies derived reducing force, decreasing benefits, eliminating overtime payments. These long regarded peculiarly framework, experience demonstrates negotiation highly successful achieving peaceful accommodation conflicting interests." 213-214, 26 prevalence "contracting out" generally taken proof "amenability process." 27 approach mind, turn hand: economically III Atlantic 28 Both control utmost seriousness. noted, serve party's individual interest, foster neutral manner system interests resolved. seems particularly important, therefore, consider sort advance interest participating particular facility springs legitimate job security. observed: [§ 8(d)] plainly cover results" 210, 402. practical participating, largely uniform: seek halt closing. doubt impelled, seeking ends, concessions, information, alternatives helpful forestall prevent jobs.19 unlikely, itself, effects, augment information suggestions. There significant security "effects" 8(a)(5). See, e. g., Royal Plating Polishing 350 191, 196 1965); Adams Dairy, 108 (CA8 1965), 382 1011, 86 619, 256 And, 8(a)(5), conducted meaningful impose sanctions insure adequacy. pursuing rights, achieve valuable concessions negotiations provisions implementing rights notice, fair BNA, Basis Patterns Contracts 62-64 (9th ed., 1979). Moreover, dealing protected 8(a)(3), prohibits closings animus, gain advantage. (1965). Under inquire into motivations behind An mask weaken circumvent "purely economic." Thus, natural hastily unnecessarily entered into, indirectly ensure considered. protection intent 32 Management's discuss kind much more complex varies circumstances. important factor failing close, incentive confer voluntarily make profitable. News World Report, Feb. 9, 1981, Page 74; Yearbook-1979, (UAW Chrysler wages benefits). times, great speed, flexibility, secrecy opportunities exigencies.20 face tax securities consequences hinge confidentiality, timing plant closing, reorganization corporate structure. publicity incident normal injure transition damage feasible alternative even good-faith futile cause additional loss.21 33 difference, permitted Labeling afford powerful tool delay, used thwart management's intentions solution propose. Comment, "Partial Terminations"—A Choice Between Bargaining Equality Economic Efficiency, U.C.L.A.L.Rev. 1089, 1103-1105 (1967). addition, many cases before involved, did, often coupled practices. Electrical Div. Midland-Ross 617 977 1980), 871, 91 (1981); Amoco Chemicals 529 427 (CA5 1976); Typewriter 533 1030 Mfg. 351 74 1965) (subcontracting); Smyth 247 1139 (1980). cases, action relief access equally dissatisfied obligations remedy here. 34 evidence current indication binding guide, see 176, 396, supports apparent imbalance weighing We note participate alteration appear relatively rare. Provisions prevalent. Collective Negotiations 65:201-233 Dept. Labor, Bureau Statistics, Bull. 2065, Characteristics Major Agreements, Jan. 1978, 96, 100, 101, 102-103 (1980) (charting interplant relocation allowances; layoffs, shutdowns, technological changes; wage-employment guarantees; separate tables decision-bargaining, presumably rarity). 1425-10, Plant Movement, Transfer, Relocation Allowances (July 1969). Further, ill-suited harmonious difficulty determining faced situation involved necessity sufficiently compelling obviate decide risk ultimately harsh remedies forcing large amounts regardless reopening 239 323 (1978), enf'd, Lever Brothers International 554 115 (CA4 1976) (enjoining closure permit negotiations). Also, crucial circumstance based Harvester 618 (CA9 1980) (change marketing structure); Thompson Transport 406 698 (CA10 1969) (loss customer). And traditional futile. ABC Trans-National Transport, Incorporated 642 675 1981) (although violated "duty" freight terminal enforce bargain). try fulfill court's exactly stage deliberations arise amount suffice implement Compare Burns Ford, 182 753 (1970) (one week's sufficient), Hartmann Luggage 145 1572 (1964) (entering executory subcontracting yet final), 148 545, 555 (1964), enf. 191 (two weeks' inadequate). yield demands, conclude "surface bargaining," Reed Prince 205 131 (CA1), 346 887, 139, 98 391 (1953). too, limits prerogatives, powers whether, so, trigger Offset 210 854 (1974) (union's failure realize shutdown imminent, successive advertisements, sales equipment, bargain); Shell Oil 149 305 (union waived meetings announced few implementation). 36 decision,22 hold conditions," n. 12,supra, bargaining.23 B 37 illustrate our holding, again case. First, decided replace move elsewhere. sole loss, claim animus. solely willing pay. authority offered advice party whom rested success consider. distinguish presented Fibreboard. difficulties begun. thus abrogation ongoing agreement. Finally, involve single locations, believe "significant withdrawal capital," General Motors GMC Truck Coach Div., N.L.R.B., 952, crucial. location unlike opening new line going entirely. 38 judgment accordingly, reversed, remanded proceedings opinion. 39 so ordered. 40 BRENNAN, MARSHALL joins, dissenting. 41 Section employee representatives meet reasonable times 158(d). question Corporation's Center meaning rendering unlawful. 42 resulting 402, (1964). today admits, "touches Ante, 677. concedes, indefinite, able give content changing conditions. 2579, 14. exercise congressionally delegated accumulated expertise, determined affects declines defer sensitive relations, basis pure speculation reverses Appeals. N Dec. Immigration Nationality Decisions respectfully dissent. 43 bases balancing test. states 679. cannot agree test, takes account ; fails 734-740 1978) (balancing retaining maintaining unhindered direction). one-sided serves manner'" serious, two-sided controversies. ante, 680-681. 44 Even Court's statement test accurate, join application, speculation. Apparently, concludes minimal, provides effect. acknowledges asserts "[i]t suggestions." 681. Recent experience, suggests contrary. Most conspicuous, perhaps, Auto led adjustments compensation contributing Chrysler's ability remain afloat. Wall Street Journal, Oct. 26, 1979, 3, col. 1. where company's can enable operation—if concessions.* 45 presumes "speed, secrecy" frustrated requirement 682-683. correct. others, openly de liberately, considerations inapposite. Indeed, admitted 677-678, 15, difficult understand why unduly publicize 46 am position national policy, primary responsibility entrusted courts prefer another statute. 495-497, 1848-1849, Erie Resistor 373 221, 236, 83 1139, 1149, 308 (1963). therefore presumptively operation, rebutted futile, emergency circumstances, that, reason, 601 (CA2 1980). amply supported recent Brooks-Scanlon, 246 476, 102 Reference Manual (BNA) KF3315 L38 1606 Raskin Packing 1489 M. Transportation 73 (1978). vacate remand examination evidence. SEC Chenery 80, 94-95, 63 454, 626 (1943). record show precise dimension 464 (1979). One owners testified time "between two four" homes customers. Ibid. hypothesized, however: "This Company. For know, men small total area." 465. disclose how satisfied. event, point shortage notice. May 11, 1977. 50. rejected satisfied, phone call found "regular usual" "taking on, finishing, discontinuing job," 466, "[t]here job. spot sense altered nature substantially affect size." inapplicable ruling Trucks, Division Mack 1002, 1003 (1977), 720 1978), involves " 'significant capital' 'affect ultimate enterprise,' quoting 951, 952 grounds enforcement error proper factfinding. Pipefitters, 429 507, 522, 97 891, 900, 51 (1977); 95, agreed, F.2d, 601, Third established, analyzed differently rebutted. competing weighed, factfinding circumstances Equitable Gas 637 980 (partial closing); closing). Several Circuit. Davis 1264 (CA7 full-service restaurant self-service cafeteria); Production Molded Plastics, 604 451 (CA6 1979) (plant 1980); 526 (1966); Transmarine Navigation 933 1967); Rapid Bindery, 293 170 1961); Morrison Cafeterias Consolidated, 431 254 1970); Drapery 425 1026 William Detective Agency, 897 1965). Car Rental System, 252 159, (employer's car leasing 'essentially managerial nature,' capital, affecting 952), Summit Tooling 195 479, 480 (1972) (decision subsidiary "its Respondent manufacturing tooling products"), 567, 568 (1966) multiple plants directly "interests sufficient ought consulted them"). Kingwood Mining 844 (1974), aff'd sub nom. Mine 169 U.S.App.D.C. 301, 515 1018 (1975). "Experience abundantly demonstrated recognition self-organization own choosing condition peace. Refusal prolific causes strife. outstanding fact history disturbances judicial citation instances." 42, (upholding constitutionality Act). Sections 8(b)(3) representative, respectively, refuse 158(a)(5) 158(b)(3). 8(d), added, 8(b)(3), amendatory 1947, 61 136, defines performance ." 9(a) specifies "[r]epresentatives designated purposes, shall exclusive rates pay, hours 159(a). illegal, raised table faith, incorporate enforceable not, insist impasse. Borg-Warner 342, 718, 823 (1958). enacting House "(i) [w]age rates, requirements; (ii) procedures relating discharge, suspension, lay-off, recall, seniority, discipline, demotion, assignment unit; (iii) conditions, procedures, governing safety, sanitation, health place employment; (iv) vacations leaves absence; (v) administrative procedural foregoing subjects." H.R. 3020 2(11), 80th Cong., 1st Sess. (1947). adoption, instead, phrase now clearly meant future interpretation H.R.Rep.No.245, Sess., 71 (1947) (minority report) ("The formula; inevitably depend traditions social political climate factors. What instance trade-unions, second place, agency skilled field competent devote necessary study industry area country, review courts. strait-jacketed legislative enactment"); H.R.Conf.Rep.No.510, 34-35 (1947), U.S.Code Cong.Serv. 1135. Specific references closings, inconclusive. Cong.Rec. 7673, 9682 (1935) (comments Sen. Walsh Rep. Griswold). results stop duty. consented severance 21-22. compel agreements whatever. 'from refusing individuals whatever terms' 'may determine.' theory accredited promote bring compel." 45, 628. John Wiley Sons, Livingston, 376 543, 549, 84 909, 914, 898 objectives reflected principles federal law, rightful prerogative independently rearrange businesses eliminate themselves balanced sudden relationship"). abandon proposals. subjects, provide understanding problem, proposals advances. concluding reject possible strike power. Fleming, Obligation Bargain Good Faith, 47 Va.L.Rev. 988 (1961). changed time. Employers diverse profit-sharing plans, 567 1343 (CA5), 439 985, 576, 58 656 (1978); Awrey Bakeries, 548 138 contractual clauses race discrimination, Wichita Eagle Beacon Publishing 222 742 (1976); "most favored nation" clauses, Dolly Madison Industries, 1037 (1970). 353, 724 (Harlan, concurring part). past instances aided saving lending technical assistance, benefits increasing production, loaning earned closures. S. Slichter, Healy, Livernash, Impact 845-851 (1960); C. Golden Haw. Hawai‘i KFH45 A2 Rutenberg, Dynamics Industrial Democracy 263-291 (1942). America, Local 1330, 492 F.Supp. (ND Ohio), vacated 631 purchase plant); 104 LRR (employee ownership plan instituted save company); 267-268 accepted cuts plant's problems). come intervention enforcing Assn. Machinists Aerospace Northeast Airlines, 473 556-557 845, 93 48, (1972); M Goetz, Duty About Changes Operations, 1964 Duke L.J. 9-10, Detroit Edison 440 316, 1123, 1131, 59 333 (1979) (noting "danger inadvertent leaks" confidential information). 1981); Loomis Herman, Reserved Rights NLRB—An Employer's View, Lab.L.J. 695 (1968); 1089 course intimate types relocations, sales, kinds subcontracting, automation, etc., facts. Ladies' Garment 150 71, 463 907 predominantly costs); Weltronic 419 1120 miles), 398 938, 1841, 270 (1970); Dan Dee West Virginia 180 534 distribution, employee-drivers contractors); Young Service, 156 661 sell portion business). Schwarz, Partial Termination—The Decision-Bargain, Ford.L.Rev. 81, 100-102 contentions amicus Railroad Telegraphers Chicago N.W.R. 362 330, 80 761, 774 (1960), mandatory. agent railroad stations thereby number threatened railroad's issue, injunction court. Construing 2, Railway 152, effort unlawful demand," 341, 767, precluded enjoining Norris-LaGuardia 104, deprives "jurisdiction restraining temporary permanent growing prohibit person persons interested [c]easing perform expansive railroads "exert every maintain working 13(c) 113(c), defining "labor dispute" "any controversy aims transportation policy. 336-338, 764-765. prohibition injunctive contained coextensive jurisdiction 402 570, 579, 1731, 1736, 187 (1971) ("parallels exert effort, like parallels drawn care full awareness differences schemes"). Boys Markets, Retail Clerks, 235, 1583, 199 Buffalo Forge Steelworkers, 428 3141, 1022 (1976). found: "On record, opportunity, accepting reduction (take-backs) whole enabled increased least, tested, produce solution." 602

Classification Label: 6