Court Opinion

ID: 8944201
Source: CourtListenerOpinion
Date Created: 2022-11-27 08:14:40.060858+00
Date Added: 2024-06-11T17:09:48.992749
License: Public Domain

WINTER, Chief Judge,
dissenting:
For the reasons set forth in the dissenting panel opinion, Beck v. Communications Workers of America, 776 F.2d 1187, 1214-25 (4 Cir.1985), I conclude that the judgment of the district court should be reversed and it should be directed to dismiss the complaint.1 From a contrary disposition, I respectfully dissent.
Although the dissenting panel opinion sets forth what I consider to be the correct resolution of the legal issues presented by this appeal, I am constrained to comment on the separate opinion of Judge Murna-ghan.
The thesis advanced by Judge Murna-ghan is essentially one of his own devising. It is not one advanced by the parties and litigated by them. Although the in banc per curiam opinion now claims that the majority panel opinion rested, in part, on Judge Murnaghan’s theory, the weakness of the claim is fully exposed in note 3 of what Judge Murnaghan has written. Certainly a single, obscure reference in almost twenty-five pages of text, is a fair indication that not much reliance was put on the theory.
In any event, Judge Murnaghan expresses the view that while § 8(a)(3) of the National Labor Relations Act, 29 U.S.C. § 158(a)(3), does not prohibit unions from spending agency fees for purposes unrelated to collective bargaining, grievance adjustment, or contract administration, a union’s duty of fair representation under § 9(a) of the Act, 29 U.S.C. § 159, prohibits such expenditures with agency fees collected from dissenting employees. Judge Mur-naghan’s view does not withstand close scrutiny.
The duty of fair representation is a judicial doctrine derived from the statutory duty of representatives designated or selected for the purposes of collective bargaining to “be the exclusive representatives of all of the employees in such unit for the purposes of collective bargaining in respect to rates of pay, wages, hours of employment, or other conditions of employ-ment____” § 9(a) (emphasis added). The *1291doctrine was first formulated with respect to the Railway Labor Act, Steele v. Louisville & Nashville Railroad Co., 323 U.S. 192, 65 S.Ct. 226, 89 L.Ed. 173 (1944), and it was extended to the National Labor Relations Act in Ford Motor Co. v. Huffman, 345 U.S. 330, 73 S.Ct. 681, 97 L.Ed. 1048 (1953). As described in Vaca v. Sipes, 386 U.S. 171, 177, 87 S.Ct. 903, 910, 17 L.Ed.2d 842 (1967):
Under this doctrine, the exclusive agent’s statutory authority to represent all members of a designated unit includes a statutory obligation to serve the interests of all members without hostility or discrimination toward any, to exercise its discretion with complete good faith and honesty, and to avoid arbitrary conduct.
As the cases demonstrate, the doctrine is generally invoked to redress discrimina-tions by a union on the basis of race, because of animosity toward a member of the bargaining unit, in short, because of any irrational, unequal, unfair treatment of a member of the bargaining unit. It has been held that the doctrine is inapplicable to internal union matters that do not involve the employer such as the expenditure of dues. See Price v. International Union, 795 F.2d 1128 (2 Cir., 1986).2 It hardly seems applicable where the union’s challenged expenditures were made equally on behalf of all members of the collective bargaining unit, dues paying union members and agency-fee paying nonunion members alike. Absent proof that a union acted arbitrarily, discriminatorily, or in bad faith in spending its revenues, there is no breach of the duty of fair representation even if the employer is also involved. See Price, supra.
More importantly, it would seem obvious to me that the duty of fair representation, derived from § 9 of the Act, cannot be transgressed if a union does only what Congress has intentionally refrained from prohibiting it to do. As the dissenting panel opinion spells out in detail, 776 F.2d at 1215-18, Congress was fully aware of proposals to limit the use of monies collected from members of the bargaining unit for purposes not directly related to collective bargaining, grievance adjustment, etc. It took testimony protesting the expenditure of such monies for political purposes, and it considered a number of legislative proposals to prohibit or severely limit such expenditures. In the final analysis, it rejected all of the proposed restrictions and enacted legislation only limiting excessive or discriminatory initiation fees for union membership, 29 U.S.C. § 158(b)(5), and prohibiting the use of monies collected in connection with federal elections, 2 U.S.C. § 441(b)(3).3 It is abundantly clear from the legislative history of these provisions that more stringent regulation was rejected as a matter of legislative judgment and not because of any thought that regulation was unnecessary because the judicial doctrine of fair representation established at the time that Congress considered the issue of regulation accomplished that result.4 *1292From my study of the legislative history, I think it sheer sophistry to assert that Congress decided on a course of very limited regulation only with respect to dues from union members and not also with respect to agency fees. Agency fees are the equivalent of union dues, and it is inconceivable to me that Congress specifically intended not to regulate the expenditure of union dues except in minor respects but, by mere silence, intended the expenditure of agency fees to be regulated under the judicial doctrine of the duty of fair representation.5
As I view it, the concurring opinion simply fails to appreciate the delicate compromise the Taft-Hartley Act managed to achieve. Congress considered the argu-mente of those who sought to prohibit all union security agreements, and those who wished to retain all such agreements, including the “closed shop.” Senator Taft took a middle position, distinguishing between closed shops and the “union shop.” Under his compromise, an employee could work at a unionized facility without acquiring membership, but only as long as he “pa[id] the same dues as other members of the union.” 93 Cong.Rec. § 4400 (daily ed. April 30, 1947), reprinted in 2 Legislative History of the Labor Management Relations Act, 1947, at 1142 (1948). Senator Taft explained that the bill thus prohibited the closed shop and guaranteed that a worker could “get a job without joining the union or asking favors of the union____” 2 Legislative History, supra, at 1422. Once assured of this right to work without union membership, however, Senator Taft asserted that “[t]he fact that the employee will have to pay dues to the union seems ... to be much less important.” 2 Legislative History, supra, at 1422. See also id. at 1010-11,1096-97,1403 (remarks of Senator Taft). Thus, the compromise that became law intended to permit union security agreements requiring nonmembers to tender the same dues to the union that members regularly paid. So far as payments to the union were concerned, members and nonmembers were on a parity and treated alike. In deciding whether to disturb this legislative solution, we should be guided by the Supreme Court’s reasoning in Local 1976, United Brotherhood of Carpenters and Joiners v. N.L.R.B., 357 U.S. 93, 99-100, 78 S.Ct. 1011, 1016-17, 2 *1293L.Ed.2d 1186 (1958), deciding a secondary boycott issue:
It is relevant to recall that the Taft-Hart-ley Act was, to a marked degree, the result of conflict and compromise between strong contending forces and deeply held views on the role of organized labor in the free economic life of the Nation and the appropriate balance to be struck between the uncontrolled power of management and labor to further their respective interests. This is relevant in that it counsels wariness in finding by construction a broad policy ... when, from the words of the statute itself, it is clear that those interested in just such a condemnation were unable to secure its embodiment in enacted law. The problem raised by these cases affords a striking illustration of the importance of the truism that it is the business of Congress to declare policy and not this Court’s.
Thus I would conclude that when a union expends agency fees for purposes unrelated to collective bargaining, grievance adjustment, or contract administration, not otherwise specifically prohibited by the Act, such expenditures are not outlawed under the duty of fair representation.
Judges HALL, PHILLIPS and SPROUSE authorize me to say that they concur in these views.

. The dissenting panel opinion spoke to the issues of state action and the duty of a union under § 8(a)(3) of the National Labor Relations Act because the panel majority based its judgment on both. The in banc majority has de-dined to consider the issue of state action. It is interesting to note, however, that the Second Circuit in Price v. International Union, 795 F.2d 1128 (1986), has emphatically rejected the view of the panel majority on the state action issue.

. Price also points out that suit for breach of the duty of fair representation will ordinarily not be entertained until there has been an exhaustion of internal union remedies. Whether there was exhaustion of any available remedies in this case is far from clear. Perhaps non-exhaustion was the reason why the parties did not advance the argument constructed by Judge Murnaghan.

. Plaintiffs make no claim that either of these restrictions was violated.

. It is disingenuous to assert that the members of Congress who vigorously debated the union security provision of § 8(a)(3) were aware that regardless of their legislative compromise, the judiciary remained free to imply additional limitations under the duty of fair representation. See ante at 1288 & n. 11 (Murnaghan, J., concurring). It is true that the Supreme Court first recognized that duty in Steele v. Louisville & Nashville R.R., 323 U.S. 192, 65 S.Ct. 226, 89 L.Ed. 173 (1944) three years before Congress enacted the Taft-Hartley Act. But Steele merely held that under the Railway Labor Act, a union could not refuse to represent black employees in the collective bargaining process because it had a "duty to exercise fairly the power conferred upon it in behalf of all those for whom it acts, without hostile discrimination against them.” Id. at 203, 65 S.Ct. at 232. Unlike the present case where Judge Murnaghan implies from the Act a limitation that Congress rejected, the Steele court could fairly state that a duty to represent all the workers of a unit in collective bargaining with the employer “expresse[d] the *1292aim of Congress.” Id. at 202, 65 S.Ct. at 232. Three years later when Congress decided as a matter of national labor policy to reject proposed limitations on union dues, it is untenable to think that it was "aware" that the Steele decision might serve to accomplish the same thing. It is a testament to the unforeseeability of this reading of Steele that no other court has so expanded the duty of fair representation for nearly forty years.

. Judge Murnaghan argues, ante at 1288, that the legislative history only shows that Congress rejected limits on union expenditures of members’ dues, leaving open the possible regulation of nonmembers' agency fees. It is true that the provisions of the House bill limiting initiation fees and dues to "reasonable” amounts expressly applied only to "members.” H.R. 3020, 80th Cong., 1st Sess. §§ 7(b), 8(c)(2) (1947); see Beck, 776 F.2d at 1216 (Winter, C.J., dissenting). But the union security agreement provision of that bill, § 8(d)(4), much like the present § 8(a)(3), would have made it an unfair labor practice for the employer to deny employment to individuals whose membership was denied despite their "tendering] to the [labor] organization the initiation fees and dues regularly imposed as a condition of membership therein____” Nonmembers had a right to work under this bill if they tendered the dues "regularly imposed” on members, and, thus, through § 8(d)(4) the reasonableness limitations would have applied to agency fees. In rejecting this bill, Congress rejected the regulation of fee collection from members and nonmembers for reasons applicable to both. The House Minority Report criticized the bill’s attempt to monitor union fees as an undue regulation of unions’ internal affairs that, as a practical matter, was unenforceable because of “the infinite details involved in the internal functioning of thousands of trade-unions having millions of members." H.R.Rep. No. 245, 80th Cong., 1st Sess. 76 (1947) (Minority Report); see Beck, 776 F.2d at 1216 (Winter, C.J., dissenting). As the dissenting panel opinion notes, the proceedings of this one case, requiring over nine years, over 4,000 pages of testimony, over 3,000 documents, two district judges and a special master, “exemplify precisely the situation that Congress decided to avoid in defeating the amendment to supervise union dues collection.” Beck, 776 F.2d at 1218 (Winter, C.J., dissenting). The result is identical, and equally offensive to Congressional intent, whether accomplished through the interpretation of § 8(a)(3), or the expansion of the duty of fair representation.