Court Opinion

ID: 9422903
Source: CourtListenerOpinion
Date Created: 2023-08-02 23:05:05.954485+00
Date Added: 2024-06-11T17:22:40.269632
License: Public Domain

Mr. Justice Stewart,
with whom Mr. Justice Douglas and Mr. Justice Harlan join,
concurring.
Viewed broadly, the question before us stirs large issues. The Court purports to limit its decision to “the *218facts of this case.” But the Court’s opinion radiates implications of such disturbing breadth that I am persuaded to file this separate statement of my own views.
Section. 8 (a)(5) of the National Labor Relations Act, as amended, makes it an unfair labor practice for an employer to “refuse to bargain collectively with the representatives of his employees.” Collective bargaining is defined in § 8 (d) as:
“the performance of the mutual obligation of the employer and the representative of the employees to meet at reasonable times and confer in good faith with respect to wages, hours, and other terms and conditions of employment.”
The question posed is whether the particular decision sought to be made unilaterally by. the employer in this case is a subject of mandatory collective bargaining within the statutory phrase “terms and conditions of employment.” That is all the Court decides.1 The Court most assuredly does not decide that every managerial decision which necessarily terminates an individual’s employment is subject to the duty to bargain. Nor does the Court decide that subcontracting decisions are as a general matter subject to that duty. The Court holds no more than that this employer’s decision to subcontract this work, involving “the replacement of employees in the existing bargaining unit with those of an independent contractor to do the same work under similar conditions of employment,” is subject to the duty to bargain collectively. Within the narrow limitations implicit in the specific facts of this case, I agree with the Court’s decision.
Fibreboard had performed its maintenance work at its Emeryville manufacturing plant through its own em*219ployees, who were represented by a local of the United Steelworkers. Estimating that some $225,000 could be saved annually by dispensing with internal maintenance, the company contracted out this work, informing the union that there would be no point in negotiating a new contract since the employees in the bargaining unit had been replaced by employees of the independent contractor, Fluor. Maintenance work continued to be performed within the plant, with the work ultimately supervised by the company’s officials and “functioning as an integral part” of the company. Fluor was paid the cost of operations plus $2,250 monthly. The savings in costs anticipated from the arrangement derived largely from the elimination of fringe benefits, adjustments in work scheduling, enforcement of stricter work quotas, and close supervision of the new personnel. Under the cost-plus arrangement, Fibreboard remained responsible for whatever maintenance costs were actually incurred. On these facts, I would agree that the employer had a duty to bargain collectively concerning the replacement of his internal maintenance staff by employees of the independent contractor.
The basic question is whether the employer failed to “confer in good faith with respect to . . . terms and conditions of employment” in unilaterally deciding to subcontract this work. This question goes to the scope of, the employer’s dúty in the absence of a collective bargaining agreement.2 It is true, as the Court’s opinion *220points out, that industrial experience may be useful in determining the proper scope of the duty to bargain. See Labor Board v. American Nat. Ins. Co., 343 U. S. 395, 408. But data showing that many labor, contracts refer to subcontracting or that subcontracting grievances are frequently referred to arbitrators under collective bargaining agreeménts, while not wholly irrelevant, do not have much real bearing, for such data may indicate no more than that the parties have often considered it mutually advantageous to bargain over these issues on a permissive basis. In any event, the ultimate question is the scope of the duty to bargain defined by the statutory language.
It is important to note that the words of the statute are words of limitation. The National Labor Relations Act does not say that the employer and employees are bound to confer upon any subject which interests either of them; the specification of wages, hours, and other terms and conditions of employment defines a limited category of issues subject to compulsory bargaining. The limiting purpose of the statute’s language is made clear by the legislative history of the present Act. As originally passed, the Wagner'Act contained no definition of the duty to bargain collectively.3 In the 1947 revision of the Act, the House bill contained a detailed but limited list of subjects of the duty to bargain, excluding all others.4 In conference the present language was substi-. tuted for the House’s detailed specification. While the language thus incorporated in the "1947 legislation as *221enacted is not so stringent as that contained in the House bill, it nonetheless adopts the same basic approach in seeking to define a limited class of bargainable issues.5
The phrase “conditions of employment” is no doubt susceptible of diverse interpretations. At the extreme, the phrase could be construed to apply to any subject which is insisted upon as a prerequisite for continued employment. Such an interpretation, which would in effect place the compulsion of the Board behind any and all bargaining demands, would be contrary to the intent of Congress, as reflected in this legislative history. Yet there are passages in the Court’s opinion today which suggest just such an expansive interpretation, for the Court’s opinion seems to imply that any issue which may reasonably divide an employer and his employees must be the subject of compulsory collective bargaining.6
Only a narrower concept of “conditions of employment” will serve the statutory purpose of delineating a limited category of issues which are subject to the duty to bargain collectively. Seeking to effect this purpose, at least seven circuits have interpreted.the statutory language to exclude various kinds of management decisions from the *222scope of the duty to bargain.7 In common parlance, the conditions of a person’s employment are most obviously the various physical dimensions of his working environment. What one’s hours are to be, what amount of work is expected during those hours, what periods of relief are available, what safety practices are observed, would all seem conditions of one’s employment. There are other less tangible but no less important characteristics of a person’s employment which might also be deemed “conditions” — most prominently the characteristic involved in this case, the security of one’s employment. On one view of the matter, it can be argued that the question whether there is to be a job is not a condition of employment; the question is not orie of imposing conditions on employment, but the more fundamental question whether there is to be employment at all. However, it is clear that the Board and the courts have on numerous occasions recognized that union demands for provisions limiting an employer’s power to discharge employees are man-datorily bargainable. Thus, freedom from discriminatory discharge,8 seniority rights,9 the imposition of a compulsory retirement age,10 have been recognized as subjects upon which an employer must bargain, although all of these concern the very existence of the employment itself.
*223While employment security has thus properly been recognized in various circumstances as a condition of employment, it surely does not follow that every decision which may affect job security is a subject of compulsory collective bargaining. Many decisions made by management affect the job security of employees. Decisions concerning the volume and kind of advertising expenditures, product design, the manner of financing, and sales, all may bear upon the security of the workers’ jobs. Yet it is hardly conceivable that such decisions so involve “conditions of employment” that they must be negotiated with the employees’ bargaining representative.
In many of these areas the impact of a particular management decision upon job security may be extremely indirect and uncertain, and this alone may be sufficient reason to conclude that such decisions are not “with respect to . . . conditions of employment.” Yet there are other areas where decisions by management may quite clearly imperil job security, or indeed terminate employment entirely. An enterprise may decide to invest in labor-saving machinery. Another may resolve to liquidate its assets and go out of business. Nothing the Court holds today should be understood as imposing a duty to bargain collectively regarding siich managerial decisions, which lie at the core of entrepreneurial control. Decisions concerning the commitment of investment capital and the basic scope of the enterprise are not in themselves primarily about conditions of employment, though the effect of the decision may be necessarily to terminate employment. If, as I think clear, the purpose of § 8 (d) is to describe a limited area subject to the duty of. collective bargaining, those 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 that area.
*224Applying these concepts to the case at hand, I do not believe that an employer’s subcontracting practices are, as a general matter, in themselves conditions of employment. Upon any definition of the statutory terms short of the most expansive, such practices are not conditions— tangible or intangible — of any person’s employment.11 The question remains whether this particular kind of subcontracting decision comes within the employer’s duty to- bargain. On the facts of this case, I join the Court’s judgment, because all that is involved is the substitution of one group of workers for another to perform the same task in the same plant under the ultimate control of the same employer. The question whether the employer may discharge one group of workers and substitute another for them is closely analogous to many other situations within the traditional framework of collective bargaining. Compulsory retirement, layoffs according to seniority, assignment of work among potentially eligible groups within the plant — all involve similar questions of discharge and work assignment, and all have been recognized as subjects of compulsory collective bargaining.12
Analytically, this case is not far from that which would be presented if the employer had merely discharged all its employees and replaced them with other workers willing to work on the same job in the same plant without the various fringe benefits so costly to the company. While such a situation might well be considered a §8 (a)(3) violation upon a finding that the employer discriminated against the discharged employees because of *225their union affiliation, it would be equally possible to regard the employer’s action as a unilateral act frustrating negotiation on the underlying questions of work scheduling and remuneration, and so an evasion of its duty to bargain on these questions, which are concededly subject to compulsory collective bargaining.13 Similarly, had the employer in this.case chosen to bargain with the union about the proposed subcontract, negotiations would have inevitably turned to the underlying questions of cost, which prompted the subcontracting. Insofar as the employer frustrated collective bargaining with respect to these concededly bargaining issues by its unilateral act of subcontracting this work, it can properly be found to have violated its statutory duty under § 8 (a) (5).
This kind of subcontracting falls short of such larger entrepreneurial questions as what shall be produced, how capital shall be invested in fixed assets, or what the basic scope of the enterprise shall be. In my view, the Court’s decision in this case has nothing to do with whether any aspects of those larger issues could under any circumstances be considered subjects of compulsory collective bargaining under the, present law.
I am fully aware that in this era of automation and onrushing technological change, no problems in the domestic economy are of greater concern than those involving job security and employment stability. Because of the potentially cruel impact upon the lives and fortunes of the working men and women of the Nation, these problems have understandably engaged the solicitous attention of government, of responsible private business, and particularly of organized labor. It is possible that in meeting these problems Congress may eventually decide to give organized labor or government a far heavier hand *226in controlling what until now have been considered the prerogatives of private business management. That path would mark a sharp departure from the traditional principles of a free enterprise economy. Whether we should follow it is, within constitutional limitations, for Congress to choose. But it is a path which Congress certainly did not choose when it enacted the Taft-Hartley Act.

 Except for the quite separate remedy issue discussed in Part II of the Court’s opinion.

 There was a time when one might have taken the view that the National Labor Relations Act gave the Board and the courts no power .to determine the subjects about which the parties must bargain — a view, expressed by Senator Walsh when he said that public concern ends at the bargaining room door. .79 Cong. Rec. 7659 (1935). See Cox and Dunlop, Regulation of Collective Bargaining by the National Labor Relations Board, 63 Harv. L. Rev. 389. But too much law has been built upon a contrary assumption for this view any longer to-prevail, and I question neither the power of the Court to decide this issue nor the propriety of its doing so.

 However, it did recognize that the party designated by a majority of employees in a bargaining unit shall be their exclusive representative “for the. purposes of collective bargaining in respect to rates of pay, wages, hours of employment, or other conditions of employment.” § 9 (a).

 H. R. 3020, 80th Cong., 1st Sess., §2 (ll)(B)(vi) (1947),-in I Legislative History of the Labor Management Relations Act, 1947, at 166-167 (1948). (Hereinafter LMRA.)

 The conference report accompanying the bill said that although this section “did not prescribe a purely objective test of what constituted collective bargaining, as did the House bill, [it] had to a very substantial extent the same effect ...” I LMRA 538.' Though this statement refers to the entire section, it is clear from the context that the focus of attention was upon the procedures of collective bargaining rather than its scope.

 The opinion of the Court seems to assume that the only alternative to compulsory collective bargaining is unremitting economic warfare. But to exclude subjects from the ambit of compulsory collective bargaining does not preclude the parties from seeking negotiations about them ón a permissive basis. And there are limitations upon the use of economic force to compel concession upon subjects which are only permissively bargainable. Labor Board v. Wooster Div.. of Borg-Warner Corp., 356 U. S. 342.

 Labor Board v. Adams Dairy, 322 F. 2d 553 (C. A. 8th Cir. 1963); Labor Board v. New England Web, 309 F. 2d 696 (C. A. 1st Cir. 1962); Labor Board v. Rapid Bindery, 293 F. 2d 170 (C. A. 2d Cir. 1961); Jays Foods v. Labor Board, 292 F. 2d 317 (C. A. 7th Cir. 1961); Labor Board v. Lassing, 284 F. 2d 781 (C. A. 6th Cir. 1960); Mount Hope Finishing Co. v. Labor Board, 211 F. 2d 365 (C. A. 4th Cir. 1954); Labor Board v. Houston Chronicle, 211 F. 2d 848 (C. A. 5th Cir. 1954).

 Labor Board v. Bachelder, 120 F. 2d 574 (C. A. 7th Cir. 1941). See also National Licorice Co. v. Labor Board, 309 U. S. 350.

 Labor Board v. Westinghouse Air Brake Co., 120 F. 2d 1004 (C. A. 3d Cir. 1941).

 Inland Steel Co. v. Labor Board, 170 F. 2d 247 (C. A. 7th Cir. 1948).

 At least four circuits have held that subcontracting decisions are not subject to the duty to bargain. Labor Board v. Adams Dairy, 322 F. 2d 553 (C. A. 8th Cir. 1963); Jays Foods v. Labor Board, 292 F. 2d 317 (C. A. 7th Cir. 1961); Labor Board v. Lassing, 284 F. 2d 781 (C. A. 6th Cir. 1960); Labor Board v. Houston Chronicle, 211 F. 2d 848 (C. A. 5th Cir. 1954).

 See notes 7,8, and 9, supra.

 Labor Board v. United States Air Conditioning Corp., 302 F. 2d 280 (C. A. 1st Cir. 1962); Labor Board v. Tak Trak, Inc., 293 F. 2d 270 (C. A. 9th Cir. 1961). Cf. Labor Board v. Katz, 369 U. S. 736.