Court Opinion

ID: 9457002
Source: CourtListenerOpinion
Date Created: 2023-08-04 20:09:12.432001+00
Date Added: 2024-06-11T17:35:10.740790
License: Public Domain

ELY, Circuit Judge
(dissenting):
I respectfully dissent. In doing so, however, I state at the outset that I accept the proposition that “[in] order for a matter to be subject to mandatory collective bargaining it must materially or significantly affect the terms or conditions of employment.” My thesis is that even if my Brothers have correctly classified the bank’s free investment service as financially “insignificant,” it should not then follow (“as the night the day”) that the benefit cannot materially affect a “term or condition of employment” as that phrase in section 8(d) of the Labor Act should be interpreted. A definition, being a rule of application, should be applied, not blindly, but with due consideration for the purpose of the rule.1 In the present context, the crucial result of interpreting the phrase so as to include free investment services is to make the latter a mandatory bargaining subject. Hence, our attention should first be directed to the reasons for mandatory bargaining.
The purpose of the Labor Act itself is “to promote the peaceful settlement of industrial disputes by subjecting labor-management controversies to the media-tory influence of negotiation.” Fibre-board Paper Products Corp. v. NLRB, 379 U.S. 203, 211, 85 S.Ct. 398, 403, 13 L.Ed.2d 233 (1964). As our distinguished counterpart, Judge Craven, writing for a panel of his court in Westinghouse Electric Corp. v. NLRB, 369 F.2d *36891, 895 (4th Cir. 1966), rev’d en banc, 387 F.2d 542 (1967), expressed it:
“The underlying philosophy of the Labor Act is that discussion of issues between labor and management serves as a valuable prophylactic by removing grievances, real or fancied, and tends to improve and stabilize labor relations. Experience teaches that major work interruptions may spring from seemingly trivial causes.”
Thus, the prevention of economic warfare would seem to require that “terms and conditions of employment” be interpreted broadly enough to encompass those “seemingly trivial” disputes which have often proved likely to cause “major work interruptions.2 Moreover, the Board, with its special expertise and experience in gauging the type of conduct which does usually portend greater conflict, should be accorded special deference as we review its interpretation in the circumstances of a particular controversy. See NLRB v. Int’l Hod Carriers, etc., Local No. 1082, 384 F.2d 55 (9th Cir.), cert. denied, 390 U.S. 920, 88 S.Ct. 853, 19 L.Ed.2d 980 (1967).
I do not say that financial impact is not important. As I see it, however, it is only one of several factors bearing on the “materiality” of a matter affecting a condition of employment. In this case, the percentage of unit employees who had availed themselves of the withdrawn benefit is another. But a third factor is the extent to which comparable alternatives are available, and a fourth is the possible existence of a scheme of benefits with a material aggregate effect, but whose components are not individually material.
Applying these factors to the facts at hand, it appears at first glance that the percentage of employees who enjoyed the benefit was minimal. Only 3% requested the free investment services in any one calendar year from January 1, 1966 to August 1, 1968. However, the record does not reveal if it was the same 3% each year, or a different 3%. If the latter, it is possible that as many as near 10% of the employees in the unit made use of the services at one time or another.3
It is unnecessary that I rest my dissenting conclusion either on the materiality of the investment service, considered alone, or on my belief that the majority’s approach does violence to the un*37derlying philosophy of the Labor Act. The free investment service should be seen as one benefit in a scheme of benefits which the bank’s employees had enjoyed for many years, none of which was ever the subject of bargaining. The unit employees have free checking account privileges, pay no service fee for money orders, and may open safety deposit boxes for half the normal customer service charge.4 Presumably, if the bank had unilaterally decided to withdraw any one of the services, it would have carried the day with the same arguments that have persuaded the majority. Thus, while these services, in the aggregate, may be presumed to affect a considerable number of unit employees,5 the bank may, piece-meal, end a series of benefits that it surely could not unilaterally terminate at one time.
The majority rejects this reasoning. It says, rightly, that nothing in the record indicates that the bank has any such oppressive scheme in mind. However, the employer’s good faith is not the issue.6 The issue is its ability — not its intention — to peck away, with the approval of a Court of Appeals, at a bundle of employee benefits until none of the components remains. In NLRB v. Central Illinois Public Service, 324 F.2d 916 (7th Cir. 1963), a board order against a gas company was enforced when the company unilaterally discontinued a 33%% discount it had offered to employee-customers of its heating gas. Fewer than half of the unit employees had taken advantage of the discount, and, as to each, it was calculated that the benefit was worth $48 per year, only four dollars per month. The majority dismisses this case summarily as one in which there was a significantly greater material impact than is here involved. Let us suppose, however, that the gas company, instead of totally eliminating the discount, had merely decreased it by 8%% to 25% ? Was it not the fact of the employer’s unilateral action, rather than the extent, which controlled the Seventh Circuit’s disposition?
I would be mistaken to place great reliance on Central Illinois, just as I believe that my Brothers are mistaken in resting so much on the en banc decision in Westinghouse, supra, and upon the subsequent Fourth Circuit opinion in McCall Corp. v. NLRB, 432 F.2d 187 (1970). In this area, none should rely too greatly on isolated decisions of other courts. As our court has recently emphasized, the determination as to whether a given issue materially affects the conditions of employment “depends upon an evaluation of the relevant facts of the particular case.” American Smelting and Refining Co. v. NLRB, 406 F.2d 552 (9th Cir. 1969).
Westinghouse and McCall Corp. concerned cafeteria food prices. There is no indication in either of the opinions that comparable alternatives to the company cafeteria were absent. It was this lack of isolation to which I principally attribute the conclusions resolved in Westinghouse and McCall Corp.
“Here, as in Westinghouse, the employees had other places to eat or they could bring their own lunches. In neither instance were the plants so isolated that employees were dependent on the food that caused the controversies. It is this circumstance that chiefly distinguishes these cases from Weyerhaeuser Timber Co., 87 NLRB 672, 25 LRRM 1163 (1947).”
*38McCall Corp., supra, 431 F.2d at 188. Here, it is undisputed that alternative free investment services are not available to the bank’s unit employees.
In terminating my comments, I record my prediction that our court will soon regret its issuance of the majority opinion in this case. The opinion needlessly overturns a carefully considered Order issued by the Board and will inevitably, I think, encourage some employers and employees alike to inflict petty irritations upon the other. The consequences could not only gravely disrupt harmonious employer-employee relationships in the vast geographical area embraced by our Circuit, but it could also burden the Board with a new flood of petty controversies and further congest the work of our court, already so heavy as to be almost unendurable.
I hold no sympathy for either of the disputants in the present case. As I see it, both of them have imposed upon the Board and upon us. The bank terminated the employee benefit only weeks before it and its employees’ representatives were scheduled to negotiate a new contract. I realize that the employee representative, confronted with bitter complaints of its members, may have then believed that it had no face-saving choice except to seek the intercession of the Board. As a practical matter, however, it could have stayed its hand until the scheduled time for the negotiations. Without doubt, it could have then obtained future benefits which might have offset or exceeded those which had been withdrawn. On the other hand, the bank’s officer could have more appropriately withheld his arrogant, unilateral action until the very imminent time when the bank could have honorably and forthrightly presented its position in face-to-face negotiations with the employees’ representative.
From the fact that the bank maintains scores of branches, I assume that it has previously enjoyed a prestigious commercial reputation, and I would have thought that such an institution would have resisted any inclination to treat its servants so cavalierly. It has won a victory of sorts in this case, but when the word of its triumph filters down through the ranks of its workmen and into the ears of the public, the victory which the majority gives it will surely, in the end, be Pyrrhic.
I would deny the bank’s petition for review and grant the Board’s cross-application for enforcement of its order.

. See Bishin, The Law Finders: An Essay in Statutory Interpretation, 38 S. Cal.L.Rev. 1 (1964).

. See Ross, The Government as a Source of Union Power: The Role of Public Policy in Collective Bargaining, 155-59, 202-265 (Brown University Press, 1965). The legislative history of 8(d), in which the phrase “terms and conditions of employment” appears, supports this proposition. This section was drafted during consideration of the Taft-IIartley Act in 1947. The House version sought specifically to enumerate the proper subjects to which collective bargaining should be limited. I Legislative History of the Labor Management Relations Act, 1947, 163-67, 313-14 (G.P.O.1948). This version was successfully opposed in the Senate. Opponents argued, inter alia, that the range of proper subjects for collective bargaining “should not be straitjacketed by legislative enactment,” I Leg. History 362.
In urging a restrictive interpretation, the majority relies on Mr. Justice Stewart’s concurring opinion in Fibreboard Paper Products v. NLRB, 379 U.S. 203, 85 S.Ct. 398, 13 L.Ed.2d 233 (1964), wherein the distinguished Justice wrote that
“tliose management decisions which are fundamental to the basic direction of a corporate enterprise or which impinge only indirectly upon employment security should be excluded from [mandatory bargaining].”
379 U.S. at 223, 85 S.Ct. at 410. Our case, however, unlike those which concerned Mr. Justice Stewart, does not involve a “managerial decision * * * which lie [s] at the core of entrepreneurial control * * * | such as] the commitment of investment, capital and the basic scope of tlie business.” 379 U.S. at 223, 85 S.Ct. at 409. Further, threats to “employment security” may be no less real for their lack of abstract financial impact.

. For this reason, I question the accuracy of the majority’s opinion that the free investment services are “of value only to the small number of employees actively trading in securities.” (Emphasis supplied) .

. Unit employees have also been entitled to preferred interest rates on bank loans. However, this benefit has been the subject of discussion in the past.

. The record is silent on this point; however, it is undeniable that the bundle affects far more employees in percentage and in dollar amount than does the investment service alone.

. Good faith, of course, does not cure an employer’s mistaken assumption that a disputed matter is not a subject of mandatory bargaining. NLRB v. Katz, 369 U.S. 736, 82 S.Ct. 1107, 8 L.Ed.2d 230 (1962); NLRB v. Central Illinois Public Service Co., 324 F.2d 916 (7th Cir. 1963).