Court Opinion

ID: 8995834
Source: CourtListenerOpinion
Date Created: 2022-11-27 12:36:10.691224+00
Date Added: 2024-06-11T17:11:02.846145
License: Public Domain

SLOVITER, Chief Judge,
concurring in part and dissenting in part.
My difference with the majority is narrow but is directed to a significant issue: whether the secondary boycott provisions of the National Labor Relations Act are applicable to a labor union seeking to protect its members from the effects of the double-breasted operations of the employer. I believe that the potential of a large damage verdict in this situation unevenly tilts the playing field designed by Congress. Thus, while I agree with the majority that there is insufficient evidence to support a jury verdict in favor of Limbach on its antitrust conspiracy claim, and I agree that the jury’s verdict on Limbach’s secondary boycott claim cannot stand because there is no basis to find the unions liable for inducement under section 8(b)(4)(i), I disagree with the majority's decision to remand for an additional determination of the unions’ liability under section 8(b)(4)(ii). I would hold that as a matter of law Limbach is not a secondary employer for purposes of the secondary boycott provisions of section 8(b)(4).
*1238For the purposes of the issue before us, I can accept arguendo the majority’s premises that a union has the obligation to bargain after a section 8(f) agreement has expired and that a union’s disclaimer of further agreements with the employer can, under certain circumstances, be treated as coercive. The analytic stumbling block for me lies in the majority’s use of the single employer doctrine to conclude that a union that chooses not to deal with one side of a double-breasted employer is in violation of the secondary boycott provisions of the NLRA. As far as I know, no case has ever so held. The majority cites none, nor do the parties. Moreover, I believe that the majority reaches its conclusion through a misapplication of the single employer doctrine and an unwarranted extension of the secondary boycott provisions.
The single employer doctrine was originally adopted by the National Labor Relations Board as a basis for determining whether to aggregate the business volume of related concerns in order to meet the minimum dollar volume of business requirement imposed by the Board itself as a jurisdictional threshold. See 21 NLRB Ann.Rep. 14-15 (1956) (describing single employer doctrine Board would apply to determine whether two firms warrant treatment as single employer for jurisdictional purposes); see also Comment, Double-Breasted Operations In The Construction Industry: A Search For Concrete Guidelines, 6 U.Dayton L.Rev. 45, 48-49 & n. 22 (1981) (Dayton Comment). In Radio & Television Broadcast Technicians Local Union 1264 v. Broadcast Service of Mobile, Inc., 380 U.S. 255, 256, 85 S.Ct. 876, 877, 13 L.Ed.2d 789 (1965) (per curiam), the Court referred approvingly to the Board’s use of four criteria (interrelationship of operations, common management, centralized control of labor relations and common ownership) as determinative of whether nominally separate business entities are an integrated enterprise and hence a single employer for the applicable jurisdictional standards.
Thereafter, the Board and the courts applied the same single employer criteria in several other contexts. For example, two wholly-owned subsidiaries may constitute a single employer, thus obligating one to follow a labor agreement entered into with the other. See South Prairie Constr. Co. v. Local 627, International Union of Operating Eng’rs, 425 U.S. 800, 96 S.Ct. 1842, 48 L.Ed.2d 382 (1976) (per curiam). The single employer doctrine also has been used to determine the bargaining obligations of different components of a corporate enterprise. See United Tel. Workers v. NLRB, 571 F.2d 665 (D.C.Cir.), cert. denied, 439 U.S. 827, 99 S.Ct. 101, 58 L.Ed.2d 121 (1978). This court has applied the traditional single employer test to determine whether a corporate enterprise committed an unfair labor practice by maintaining double-breasted operations and refusing to bargain with the representative of the unionized portion of the enterprise as the representative of the purportedly non-unionized portion of the enterprise as well. See NLRB v. Al Bryant, Inc., 711 F.2d 543, 550-52 (3d Cir.1983), cert. denied, 464 U.S. 1039, 104 S.Ct. 699, 79 L.Ed.2d 165 (1984).
The four-part formula used to determine the existence of a single employer reflects the underlying purpose of the single employer doctrine, which is to treat a functionally integrated company as one employer for labor relations purposes despite its separate corporate entities. The single employer doctrine addresses the concern that an employer may be attempting to avoid the responsibilities of a labor contract or a labor-management relationship through corporate structure. See, e.g., Penntech Papers, Inc. v. NLRB, 706 F.2d 18 (1st Cir.), cert. denied, 464 U.S. 892, 104 S.Ct. 237, 78 L.Ed.2d 228 (1983); Local No. 627, International Union of Operating Eng’rs v. NLRB, 518 F.2d 1040 (D.C.Cir.1975), modified sub nom. South Prairie Constr. Co. v. Local No. 627, International Union of Operating Eng’rs, 425 U.S. 800, 96 S.Ct. 1842, 48 L.Ed.2d 382 (1976); Gerace Constr., Inc., 193 N.L.R.B. 645 (1971).
The reflexive application of the single employer doctrine to concerted labor efforts to resist a corporate enterprise’s double-breasted operations fails to adequately address the pertinent policy issues posed by double-breasting. Double-breasted op*1239erations began to pervade the construction industry in the late 1970’s after they received the Board’s imprimatur of approval. See Dayton Comment, 6 U.Dayton L.Rev. at 45-47, 50. As this court has previously recognized, “[a] contractor engaged in a double-breasted operation has the best of both worlds, since it can bid through its union company when jobs require union contractors but can underbid a unionized company through its second operation on jobs that do not require union contractors.” NLRB v. Al Bryant, Inc., 711 F.2d at 552.
The potential destructiveness to the union of a double-breasted operation is self-evident. As one commentator has noted:
double-breasting poses a significant threat to the labor movement. From the union perspective, double-breasting improperly permits an employer to shed bargaining and contractual responsibilities while still retaining the financial benefits of ownership. Double-breasting not only diverts work to the nonunion sector, but it also puts considerable pressure on unions to grant wage and benefit concessions so that the shrinking number of union firms will remain competitive.
Befort, Labor Law and the Double-Breasted Employer: A Critique of the Single Employer and Alter Ego Doctrines and a Proposed Reformulation, 1987 Wis. L.Rev. 67, 69.
The general approach of Congress in the labor relations area has been to allow each party to use economic and bargaining strategies to exert pressure upon the other. See Senate Committee on Education & Labor, S.Rep. No. 573, 74th Cong., 1st Sess. 2 (1935) (“[disputes about wages, hours of work, and other working conditions should continue to be resolved by the play of competitive forces”). By applying the secondary boycott provision in what is essentially an economic struggle between an employer and its employees, the majority has deprived the unions of their traditional weapons and thereby shifted, perhaps irreparably, the balance between the parties in the construction industry.
The secondary boycott rules were not designed for the double-breasted employer situation. “The gravamen of a secondary boycott is that its sanctions bear, not upon the employer who alone is the party to the dispute, but upon some third party who has no concern in it. Its aim is to compel him to stop business with the employer in the hope that this will induce the employer to give in to his employees’ demands.” International Bhd. of Elec. Workers v. NLRB, 181 F.2d 34, 37 (2d Cir.1950), aff'd, 341 U.S. 694, 71 S.Ct. 954, 95 L.Ed. 1299 (1951).
Congress has condemned secondary boycotts because it is believed that they “unfairly ... enmesh in a proliferating dispute a person who [is] in truth a ‘neutral,’ a ‘stranger’ to that dispute who was ‘uninvolved’ in the union’s grievance against the primary employer.” See R. Gorman, Labor Law 241 (1976); National Woodwork Mfrs. Ass’n v. NLRB, 386 U.S. 612, 627, 87 S.Ct. 1250, 1259, 18 L.Ed.2d 357 (1967) (broad policy objective of section 8(b)(4) is the protection of neutrals against secondary pressure); NLRB v. Local 810, Steel, Metals, Alloys & Hardware Fabricators, 460 F.2d 1, 5 (2d Cir.) (same), cert. denied, 409 U.S. 1041, 93 S.Ct. 527, 34 L.Ed.2d 491 (1972).
The plain fact is that irrespective of whether the two prongs of a double-breasted operation meet the technical four criteria test of a single employer, the non-unionized portion of a double-breasted operation is not a “neutral” bystander nor is it a “stranger” to the dispute. The raison d’etre of establishment of a double-breasted operation is the effort of the employer to be free from union constraints in a portion of its operation. Therefore, a union should be free to use traditional labor weapons, whether strike or disclaimer, in an effort to stem the tide of parallel nonunion operations by companies with which it has labor agreements.
In contrast to the traditional secondary boycott where a union seeks to coerce a secondary employer merely because the secondary does business with an offending employer over which it has no control, see, e.g., NLRB v. Denver Bldg. & Constr. Trades Council, 341 U.S. 675, 71 S.Ct. 943, 95 L.Ed. 1284 (1951); NLRB v. Milk Drivers & Dairy Employees Local Union No. 584, 341 F.2d 29 (2d Cir.), cert. denied, 382 U.S. 816, 86 S.Ct. 39, 15 L.Ed.2d 64 (1965); *1240Chauffers, Teamsters & Helpers Local Union No. 175 v. NLRB, 294 F.2d 261 (D.C.Cir.1961), this is an intra-family affair. There is no dispute in this case that Walter Limbach reorganized the corporate enterprise in order to ensure that Harper would remain non-union. He allowed George Harper, a man who successfully defeated union efforts for thirty years, to remain as the president of Harper. Limbach sent its own management personnel to Harper to serve as the executive management of Harper. Furthermore, John Fern, one of Lim-bach’s Vice Presidents, was sent to Jovis to serve as its President and was given official labor relations responsibilities for Jov-is.
Notwithstanding the technical separation, there was extensive integration of Limbach Incorporated’s operations. Lim-bach and Harper utilized the same accounting and payroll services, personnel services, legal assistance, market research, advertising and sales services, mechanical engineering services, estimating services, and administrative services including procurement and assignment of automobiles, janitorial records and maintenance of company records. Thus, while I do not suggest that there was any impropriety in Limbach’s maintenance of separate unionized and non-unionized components, I believe that it is neither unexpected nor improper for the unions to react using the traditional labor weapon of disclaimer to such an overt effort by an employer to operate in two worlds.
It is therefore irrelevant that in this particular ease the Harper operation in Florida may not have been directly competitive with the unionized plants of Limbach, Inc. The object of the unions’ pressure was the Limbach organization, the primary employer. Just as it was important to Limbach to maintain the non-unionized component, so also was it a legitimate labor objective of the unions to have the entire operation unionized. The majority’s result insulates the employer from collective activity designed to prevent erosion of gains secured for the benefit of the employees in the unionized portion of the entity.
As a matter of law, I would hold that the single employer doctrine is inapplicable to a double-breasted enterprise for purposes of application of the secondary boycott provisions. As long as the unions’ actions do not contravene other provisions of the NLRA, I believe that Congress’ design does not contemplate that they be subject to liability for secondary boycotts because they exert economic pressure on double-breasted employers.