Court Opinion

ID: 9422982
Source: CourtListenerOpinion
Date Created: 2023-08-02 23:05:24.209501+00
Date Added: 2024-06-11T17:22:40.751294
License: Public Domain

Mr. Justice White,
concurring in the result.
The Court today holds that the use of economic weapons by an employer for the purpose of improving his bargaining position can never violate the broad provisions of §| 8 (a)(1) and (3) of the NLRA and hence a bargaining lockout of employees in resistance to demands of a union is invariably exempt from the proscriptions of the Act. As my Brother Goldberg well points out, the Court applies legal standards that cannot be reconciled with decisions of this Court defining the Board’s functions in applying these sections of the Act and does so without pausing to ascertain if the Board’s factual premises are supported by substantial evidence. I also think the Court, in the process of establishing the legality of a bargaining lockout, overlooks the uncontradicted facts in this *319record and the accepted findings of the trial examiner which indicate to me that the employer’s closing of the Chicago yard was not a “lockout” for the purpose of bringing economic pressure to break an impasse and to secure more favorable contract terms.
In my view the issue posed in this case is whether an employer who in fact anticipates a strike may inform customers of this belief to protect his commercial relationship with customers and to safeguard their property, thereby discouraging business, and then lay off employees for whom there is no available work. I, like the trial examiner, think he may, and do not think this conduct can be impeached under §§ 8 (a)(1) and (3) by merely asserting that the employer and his customers were erroneous in believing a strike was imminent.
The Board, the Court of Appeals, and presumably this Court, accept all the findings of the trial examiner, except the finding that the employer’s honest belief that a strike would occur had a reasonable basis in fact. The examiner found that at the time of the layoffs at the Chicago yard there was no work there and very little at the other yards, which remained open until all available work was completed. During past slack summer seasons a nucleus crew had been retained at the yards to perform emergency repair jobs for Ship Building’s 14 or 15 regular customers. Absent a job, these employees also did maintenance work, but the accommodation of these regular customers and retention of their good will was the only reason for remaining open, the operations being otherwise unprofitable. The customers learned of the labor unrest at the yards through newspaper accounts and Ship Building’s plant managers, who felt constrained to tell long-standing customers of the possibility of a strike during the course of repair work. The manager of the Buffalo yard was of the opinion that “the owner that brought the boat into the dock would have rocks in his head if he would have *320taken the chance.” Work was not refused, however. There were few, if any, requests for repairs during that summer, a substantial number of shipowners being reluctant to bring their vessels into the yard. The last job left the Chicago yard three weeks before closing. The examiner found that at the time of closing, Ship Building had “men working on maintenance in the yards, with no work on hand, none anticipated, and customers refusing to send work in.” Only those workers for whom there was no work were laid off and no new jobs were taken on. The examiner noted that the employer was not unaware of the union’s negotiating strategy and of the possible effect of a closing on this strategy. But in carefully assessing all the testimony he found that at most these considerations partially colored the employer’s motivation. The examiner concluded from these facts that “the economic inducements so overshadowed anything improper that they must be considered primary, particularly when the economic factors which supported them arose through no fault of Respondent and anteceded the layoff.”
Given the finding that the closing was due to lack of work at the Chicago yard, it is no answer to say, as the Board does, that there was no reasonable basis to anticipate a strike and hence the closing was an offensive bargaining lockout. Whether there was a reasonable basis to fear a strike or not, the fact remains that the employer, and its customers, did fear a strike, and consequently there was no work for the employees. It has long been the law that an employer is free to modify or shut down operations temporarily for business reasons unrelated to the exercise by his employees of statutory rights, and the reasonableness of an employer’s response to business exigencies is not ordinarily subject to review. See Pepsi-Cola Bottling Co., 145 N. L. R. B. 785 (1964); Associated General Contractors of America, Inc., 105 N. L. R. B. 767 (1953); cf. Fibreboard Paper Products v. Labor Board, 379 *321U. S. 203; Textile Workers Union v. Darlington Mfg. Co., decided today, ante, p. 263. There is nothing in the decisions of the NLRB, including this case, which would indicate that there are occasions when an employer may not truthfully inform his customers of a labor dispute and his fear of a strike to protect his business and their property and may not lay off employees for lack of work. Indeed, these decisions hold that an employer may shut down in response to such economic conditions, even though these conditions are the result of protected concerted activities, Pepsi-Cola Bottling Co., 145 N. L. R. B. 785 (1964); Associated General Contractors of America, Inc., 105 N. L. R. B. 767 (1953); H. H. Zimmerli, 133 N. L. R. B. 1217 (1961), so long as the creation of or alleged reliance on these conditions is not a subterfuge for a lockout, Ripley Mfg. Co., 138 N. L. R. B. 1452 (1962); Savoy Laundry, Inc., 137 N. L. R. B. 306 (1962); New England Web, Inc., 135 N. L. R. B. 1019 (1962). There is no evidence here that the lack of work was a result of the employer’s decision or desire to lay off its employees and the Board did not so find. I do not now determine whether a temporary economic shutdown could ever be found to violate the Act. Here the Board has given no reasons, no rationale, to show how this closing violated the Act, except to say the closing was a bargaining lockout. A lockout is the refusal by an employer to furnish available work to his regular employees. It is apparent that the considerations which fault an employer for refusing to furnish available work are quite different from those which would prohibit him from laying off workers for whom there is no work. Hence, reliance on the Board’s lockout cases does not explain, no less support, the result reached in this case. The compelling conclusion is that the Board has failed to “disclose the basis of its order” and to “give clear indication that it has exercised the discretion with which Congress has empowered it.” Phelps Dodge Corp. v. Labor *322Board, 313 U. S. 177, 197. This is not to say the Board has reached an erroneous balance in regard to the bargaining lockout; it is to say that the bargaining lockout analysis will not suffice to judge the legality of the layoffs in this case.
The Court, like the Board, assimilates the employer’s conduct here to the bargaining lockout and restrikes the balance; it dismisses the actual justification for the closing with the assertion that the “examiner found . . . [the] closing was not due to lack of work. Despite similarly slack seasons in the past, the employer had for 17 years retained a nucleus crew to do maintenance work and remain ready to take such work as might come in.” Ante, at 304. This, is puzzling, since the examiner found precisely the contrary, land neither the Board nor the Court of Appeals took issue with these findings. The examiner said that a nucleus crew was maintained in the past only in the expectation of emergency work, the performance of such work being thought necessary to maintain customer good will. Because of the labor uncertainty and the decision that undertaking emergency jobs would jeopardize customer relations, there was no expectation of work during the summer of 1961, unlike past years. Since I think an employer’s decision to lay off employees because of lack of work is not ordinarily barred by the Act, and since neither the Board nor the Court properly can ignore this claim, I would reverse the Board’s order, but without reaching out to decide an issue not at all presented by this case.
Since the Court does rule on the status of the bargaining lockout under the National Labor Relations Act, I feel constrained to state my views. This Court has long recognized that the Labor Relations Act “did not undertake the impossible task of specifying in precise and unmistakable language each incident which would constitute an unfair labor practice,” but “left to the Board the *323work of applying the Act’s general prohibitory language in the light of the infinite combinations of events which might be charged as violative of its terms.” Republic Aviation Corp. v. Labor Board, 324 U. S. 793, 798. Thus the legal status of the bargaining lockout, as the Court indicated in Labor Board v. Truck Drivers Union, 353 U. S. 87, 96, is to be determined by “the balancing of the conflicting legitimate interests.”
The Board has balanced these interests here — the value of the lockout as an economic weapon against its impact on protected concerted activities, including the right to strike, for which the Act has special solicitude, Labor Board v. Erie Resistor Corp., 373 U. S. 221, 234 — and has determined that the employer’s interest in obtaining a bargaining victory does not outweigh the damaging consequences of the lockout. It determined that for an employer to deprive employees of their livelihood because of demands made by their representatives and in order to compel submission to the employer’s demands, coerces employees in their exercise of the right to bargain collectively and discourages resort to that right. And this interferes with the right to strike, sharply reducing the effectiveness of that weapon and denying the union control over the timing of the economic contest. The Court rejects this reasoning on the ground that the lockout is not conduct “demonstrably so destructive of collective bargaining that the,Board need not inquire into employer motivation.” Ante, at 309. Since the employer’s true motive is to bring about settlement of the dispute on favorable terms, there can be no substantial discouragement of union membership or interference with concerted activities. And the right to strike is only the right to cease work, which the lockout only encourages rather than displaces.
This tour de force denies the Board’s assessment of the impact on employee rights and this truncated definition *324of the right to strike, nowhere supported in the Act, is unprecedented. Until today the employer’s true motive or sole purpose has not always been determinative of the impact on employee rights. Republic Aviation Corp. v. Labor Board, 324 U. S. 793; Radio Officers’ Union v. Labor Board, 347 U. S. 17; Labor Board v. Truck Drivers Union, 353 U. S. 87; Labor Board v. Erie Resistor Corp., 373 U. S. 221; Labor Board v. Burnup & Sims, Inc., 379 U. S. 21. The importance of the employer’s right to hire replacements to continue operations, or of his right to fire employees he has good reason to believe are guilty of gross misconduct was not doubted in Erie Resistor and Burnup & Sims. Nonetheless the Board was upheld in its determination that the award of super-seniority to strike replacements and discharge of the suspected employee were unfair labor practices. Of course, such conduct is taken in the pursuit of legitimate business ends, but nonetheless the “conduct does speak for itself ... it carries with it unavoidable consequences which the employer not only foresaw but which he must have intended.” Erie Resistor, 373 U. S., at 228. I would have thought it apparent that loss of jobs for an indefinite period, and the threatened loss of jobs, which the Court’s decision assuredly sanctions, cf. Textile Workers Union v. Darlington Mfg. Co., decided today, ante, at 274, n. 20, because of the union’s negotiating activity, itself protected conduct under § 7, hardly encourage affiliation with a union.
If the Court means what it says today, an employer may not only lock out after impasse consistent with §§ 8 (a) (1) and (3), but replace his locked-out employees with temporary help, cf. Labor Board v. Brown, ante, p. 278, or perhaps permanent replacements, and also lock out long before an impasse is reached. Maintaining operations during a labor dispute is at least equally as important an interest as achieving a bargaining victory, see *325Labor Board v. Mackay Radio & Telegraph Co., 304 U. S. 333, and a shutdown during or before negotiations advances an employer’s bargaining position as much as a lockout after impasse. And the hiring of replacements is wholly consistent with the employer’s intent “to resist the demands made of it in the negotiations and to secure modification of these demands.” Ante, at 309. I would also assume that under §§ 8 (a)(1) and (3) he may lock out for the sole purpose of resisting the union’s assertion of grievances under a collective bargaining contract, absent a no-lockout clause. Given these legitimate business purposes, there is no antiunion motivation, and absent such motivation, a lockout cannot be deemed destructive of employee rights. “[I]nquiry into employer motivation” may not be truncated. Ante, at 312. “Proper analysis of the problem demands that the simple intention to support the employer’s bargaining position as to compensation and the like be distinguished from a hostility to the process of collective bargaining which could suffice to render a lockout unlawful.” Ante, at 309. I think that the Board may assess the impact of a bargaining lockout on protected employee rights, without regard to motivation, and that the Court errs in failing to give due consideration to the Board’s conclusions in this regard.
The balance and accommodation of “conflicting legitimate interests” in labor relations does not admit of a simple solution and a myopic focus on the true intent or motive of the employer has not been the determinative standard of the Board or this Court. As the Court points out, there are things an employer may do for business reasons which are inconsistent with a rigid or literal interpretation of employee rights under the Act, such as the right to hire strike replacements. Labor Board v. Mackay Radio & Telegraph Co., 304 U. S. 333. But there are just as clearly others which he may not. Republic *326Aviation, 324 U. S. 793; Erie Resistor, 373 U. S. 221; Burnup & Sims, 379 U. S. 21. A literal interpretation will not suffice to reconcile these cases, nor to justify the result in the present case. For in saying an employer may lock out all his employees, the Court fully ignores the most explicit statutory right of employees “to refrain from any or all [concerted] activities.” Nor can these cases be explained by the Court's test that employer conduct is not proscribed unless it is “inherently so prejudicial to union interests and so devoid of significant economic justification,” ante, at 311, that true motivation need not be independently shown. The test is clearly one of choosing among several motivations or purposes and weighing the respective interests of employers and employees. And I think that is the standard the Court applies to the bargaining lockout in this case, but without heeding the fact the balance is for the Board to strike in the first instance.
The Board’s role in this area is a “delicate task, reflected in part in decisions of this Court, of weighing the interests of employees in concerted activity against the interest of the employer in operating his business in a particular manner.” Erie Resistor, 373 U. S., at 229. Its decisions are not immune from attack in this Court. Its findings must be supported by substantial evidence and its explication must fit the case before it, be adequate, and be based upon the policy of the Act and an acceptable reading of industrial realities. I would reverse the Board’s decision here because it has not articulated a rational connection between the facts found and the decision made. “This is not to deprecate, but to vindicate (see Phelps Dodge Corp. v. Labor Board, 313 U. S. 177, 197), the administrative process, for the purpose of the rule is to avoid 'propel[ling] the court into the domain which Congress has set aside exclusively for the administrative agency.’ 332 U. S., at 196.” Burlington Truck *327Lines v. United States, 371 U. S. 156, 169. It is to ask the Board to show that it has exercised the discretion which it has under the Act. Such insistence on a reasoned decision is a foremost function of judicial review, especially where conflicting significant interests are sought to be accommodated. Compare Securities & Exchange Comm’n v. Chenery Corp., 318 U. S. 80, with Securities & Exchange Comm’n v. Chenery Corp., 332 U. S. 194. But this function is not to reject the Board’s reasoned assessment of the impact of a particular economic weapon on employee rights. It is certainly not to restrike the balance which the Board has reached.