Petition — United Steelworkers of America v. National Rejectors Industries

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IN TH.

Supreme Court of the United States

October Term, 1977

Unrren Sree.workers or America, AF'L-CIO-CLC, er A.,

Petitioners,

Nationa, Resecrors [npustarims.,

PETITION FOR A WRIT OF CERTIORARI TO THE

UNITED STATES COURT OF APPEALS

FOR THE EIGHTH OIROUIT

- Beawarp KIWI aN Miomag. H. Gorresman

1 East Wacker Drive Roseat M. Werneero

Suite 1910 Jenemian A, Coins

Chicago, Illinois 60601 Bredhoff, Gottesman,

Cohen & Weinberg

at hp ry * 3 Avenue,

Youngdahl, Larrison & Washington, D.C, 20086

2101 Main Street Car. B. Franken

Post Office Box 6030 Five Gateway Center

Little Rock, Arkansas Pittsburgh, PA 15222

72216

Attorneys for Petitioners

<<>> i

Court, U. X

FILED

| DEC 28 i977

77-928

MICHAEL RODAK, ., CLERK

—— eT

TABLE OF CONTENTS

Page

OPINIONS BELOW ........:ccccceceeceeeeeeennnes 1

„ 1

QUESTIONS PRESENTED ....... 6.66 c cece cece ees 2

STATUTORY PROVISIONS INVOLVED .......... 2

STATEMENT OF THE CAS... 3

REASONS FOR GRANTING THE WRIT .......... 9

SOU. eee e e eee 6 660 23

Appendices:

A. Opinion of the Court of Appeals, August 30, 1977 1

B. Opinion of the District Court, April 16, 1977 21

C. Order Extending Time to File Petition for Writ

of Certiorari, November 21, 1977 30

TABLE OF AUTHORITIES

Cases

Anheuser-Busch, Ine, v. Teamsters Local 633, 511 F.2d

1097 (Ist Cir.), cert. denied, 423 U.S, 875

.. eee eee ee 6 66 6666666666606 8, 9, 15-16

Arlan's Department Store, 133 NLRB 802, 807 (1961) 19

Boys Markets v. Retail Clerks Union,

II passim

Buffalo Forge Co. v. Steelworkers,

ILL passim

Cincinnati Penthouse Club, 168 NLRB 969 (1967) 19

Far East Conference v. United States,

Se We EE ED eee 0 21

Gateway Coal Co, v. United Mine Workers,

rr cb ocebeoncdeccsvess 20

Mastro Plastics v. NLRB, 350 U.S, 270 (1956) .... passim

Nader v. Allegheny Airlines, 426 U.S, 290, 303-04 (1976) 21

NLRB v. C&C Plywood Corp., 385 U.S, 421 (1967) .... 22

Pilot Freight Carriers, Inc., 224 NLRB 342 (1976) .... 19

Sinclair Refining Co. v. Atkinson,

INI 11

Miscellaneous

BNA, Labor Relations Cumulative Digest and Index 22

Comment, Dow Chemical; Restricting the Availability

of Self-Help Measures in Labor Disputes, 77 Colum.

Ee er eee 19

Cox, The Legal Nature of Collective Bargaining Agree-

ments, 57 Mich. I., Rev. 1 (1969))/: cece eee eeves 19

Note, The Unfair Labor Practice Strike,

L 22

IN THE

Supreme Court of the United States

Ocropen Team, 1977

No.

Unrrep Srl wonk uns or Amentoa, AF'L-CIO-CLC;

Loca No, 6178, Unrren run wWonk Eu or Amenica,

AFL-CI1O-CLC: Frank Jon Russeu.; Crom D.

Lisupnoox ; Manoanet Sus Loupsami.; and

Dewey D. Sruzes, Petitioners,

Nationa, Rerecrons Inpvernimes, Respondent.

PETITION FOR A WRIT OF CERTIORARI TO THE

UNITED STATES COURT OF APPEALS

FOR THE EIGHTH OIROCUIT

Petitioners respectfully pray that a writ of certiorari

issue to review the judgment of the United States Court of

Appeals for the Kighth Circuit entered in this case on

August 30, 1977.

The opinion of the court of appeals is reported at 562

F. 2d 1069 and is reprinted here as Appendix A. The district

court 's opinion is not officially reported, but appears at

95 LRRM 2145; it is reprinted here as Appendix B.

JURISDICTION

The Court of Appeals’ opinion issued on August 30, 1977.

On November 21, 1977, Mr. Justice Blackmun extended the

time for filing a petition for a writ of certiorari to and

aeluding December 28, 1977 (Appendix C). The jurisdic-

tion of this Court is invoked pursuant to 28 U.S.C.

§ 1264(1). :

QUESTIONS PRESENTED

1. Does the ‘‘narrow’’ exception to the Norris-LaGuardia

Act prohibition of labor injunctions, recognized in Boys

Markets v., Retail Clerka Union, allow a court to enjoin

concerted activity over an arbitrable issue where that con-

certed activity is not such as would interfere with the

arbitration process in any respect?

2. May a federal court, pursuant to Boys Markets, enjoin

employee concerted activity which in the court's own view

may well! have been a response to employer unfair labor

practices, where, if the concerted activity had been a pro-

test against unfair labor practices, it would not have been a

breach of contract under Mastro Plastics Corp. v. NLRB?

STATUTORY PROVISIONS INVOLVED

Section 4 of the Norris-LaGuardia Act, 29 U.S.C. 5 104,

“ ovides in pertinent part:

No court of the United States shall have jurisdiction to

insue any restraining order or temporary or permanent

— — — in any — or growing out <7

abor dispute to p any or persons -

mating or interested in such dle te (as these terms are

rein defined) from doing, w singly or in con-

cert, any of the following acts:

(a) Ceasing or refusing to perform any work or to

remain in any relation of em t;

Section 301(a) of the Labor Management Relations Act

of 1947, 29 U.8.C. 6 185(a) provides:

Suits for violation of contracts between an employer

NL Lr IIA

industry affecting commerce as defined in this

ter, or between any such labor organizations, may

brought in any district court of the United States hav-

ing jurisdiction of the parties, without respect to the

amount in controversy or without regard to the citizen-

ship of the parties.

Section 8(a) of the National Labor Relations Act, 29

U.S.C. § 158(a) provides in pertinent part:

It shall be an unfair labor practice for an employer—

(1) to interfere with, restrain, or coerce employees in

the exercise of the rights guaranteed in section 157 of

this title

(3) by discrimination in regard to hire or tenure of

employment or any term or condition of employment

to encourage or discourage membership in any labor

organization

(5) to refuse to bargain collectively with the representa-

tive of his employees, subject to the provisions of sec-

tion 159(a) of this title.

STATEMENT OF THE CASE

The respondent, National Rejectors Industries (NRI),

operates a plant in Hot Springs, Arkansas where coin and

currency handling equipment is manufactured and assem-

bled. NRI employs some 300 production and maintenance

employees at the plant. Since 1961, petitioners United Steel-

workers of America (USWA) and its Local 6178 have been

the exclusive bargaining representatives of these employees.

On December 15, 1976, NRI suspended the employment of

the vice-president and recording secretary of Local 6178,

allegedly because of an ‘‘incident’’ it said had occurred at

a meeting between management 2nd the grievance commit-

te of Local 6178. Five days later, on December 20, 1976,

NRI discharged the president of Local 6178, effective De-

cember 15, 1976, allegedly for his part in the same ‘‘inci-

dent. The local filed grievances with respect to the sus-

This is the third time the em has attem to discharge

the president; on the two oecasions tors ordered

him reinstated.

pensions and the discharge.

Under the collective bargaining agreement, grievances

are to be resolved by a four-step procedure. The first step

calls for a meeting between the foreman and the grievant,

after which the foreman is to answer the grievance. If the

grievant is dissatisfied with the answer, a Step 2 meeting is

held between the local union grievance committee and desig-

nated management representatives. In Step 3, representa-

tives of the National Organization of the Union’’ (the

USWA) and of the ‘‘executives of the Company”’ are in-

volved; in Step 4, the dispute is submitted to binding arbi-

tration.

The grievances concerning the suspensions and discharge

never reached arbitration, or even Step 3. For on December

17, 1976 the Company announced its unwillingness to meet

in Step 2 with the grievance committee to discuss these

grievances—or any others then pending—so long as the

president of the local remained a committee member. After

efforts to resolve this dispute failed, the local filed a griev-

ance complaining of NRI’s refusal to comply with the griev-

ance-arbitration procedure.? The local also filed an unfair

2 The grievance centered on the validity of NRI’s claim that its

refusal to meet with the president of the local was authorized by

Article XV. §4 of the collective bargaining agreement, which

provides :

Should the actions of the representatives of either party be

such that the integrity of the grievance procedure is threatened,

then the authorized 3rd step representative of the Company or

Union shall notify the opposite party who shall investigate and

report back the results of such investigation and the corrective

action taken, if any. If such report is not satisfactory or if the

facts are in dispute either party may request a meeting for the

purpose of determining the facts and settling the issue. If the

issue is not satisfactorily settled at this meeting either party

may request the other to take such action as may be appro-

priate and necessary to correct the problem. In this event, the

grievance machinery shall continue to function with the next

highest officials of the Company and Union conducting the

meétings to insure the processing of grievances in a timely

labor practice charge with the National Labor Relations

Board (‘‘NLRB’’) alleging that the suspensions and dis-

charge of the local’s officers were discriminatory in viola-

tion of §8(a)(3) of the National Labor Relations Act

(‘‘NLRA’’), and that NRI’s refusal to process the griev-

ances breached the duty to bargain in good faith imposed by

§ 8(a) (5). NRI filed a cross-charge, alleging that the local’s

refusal to appoint a replacement for its president breached

its duty to bargain in good faith as required by 5 8(b) (3).

Processing of the contract grievances deadlocked because

of the company’s refusal to meet with the local’s president

as part of the grievance committee. Investigation of the

NLRB charge went forward, however, and on February 18,

1977 the NLRB’s Regional Director informed NRI that he

had decided to issue a complaint against the company at-

tacking the suspensions and discharge as violative of Sec-

tion 8(a)(3) and the refusal to meet with the local’s griev-

ance committee as violative of Section 8(a) (5); and that he

had decided that further proceedings on NRI’s cross-charge

were not warranted, as the unions’ conduct did not consti-

tute a refusal to bargain violative of the Act.

Four days later—on the same day that the Regional Di-

rector’s complaint was formally issued—NRI informed the

local of its intent to adopt six new work rules, including one

requiring all employees ‘‘to log into and out of their depart-

ments’’ whenever they left their departments for any rea-

son, even to go to the bathroom. The company refused to

meet with the local to discuss the work rules so long as the

local president attended. Consequently, several weeks later

manner until such time as both parties are agreed that normal

operation of the grievance procedures can be resumed.

NRI takes the position that this section permits it to refuse to

meet with the grievance committee so long as the union president is

a member; the union disagrees. The only explanation in the record

as to the basis of NRI’s objection to the local president’s partici-

pation is that NRI believes it is ‘‘futile’’ to meet with him.

the rules were formally promulgated without ever having

been the subject of negotiations. The local filed a grievance

alleging that the unilateral adoption of the work rules vio-

lated the collective bargaining agreement, and an unfair

labor practice charge alleging that NRI’s conduct was a

refusal to bargain violative of §8(a)(5). (The NLRB’s

Regional Director later issued a complaint on this charge

and consolidated it with the earlier-issued complaint. )*

During the first three days of the enforcement of the

new rules, 138 employees were suspended by the company

for refusing to ‘‘log in and out.“ As a result of these sus-

pensions, production at the plant dropped by 70%. The

local filed grievances challenging these suspensions. On

March 18, 1977, NRI offered to stop enforcing the ‘‘log-

ging“ rule if USWA would agree to submit the pending

grievances directly to arbitration (i.e. if the union would

agree to bypass the pre-arbitration steps, thus waiving its

right to consideration of the grievances by a committee

which ineluded the local’s president). When USWA de-

clined to bypass the contractually prescribed grievance

steps, NRI filed this action under §301(a) of the Labor-

Management Relations Act of 1947. In its complaint NRI

alleged, in essence, that petitioners had encouraged non-

compliance with the new work rules and by so doing had

breached Article XXXIV of the collective bargaining agree-

ment which provides that ‘‘there shall be no strikes, slow-

ups, stoppages of work, sit-down strikes, refusals to handle

merchandise, material or equipment or other interference

with the operation of the Company during the term of this

Agreement.“ The complaint prayed for injunctive relief

and damages.

On March 30, 1977 the district court, after holding a hear-

ing, issued an injunction requiring, inter alia, that the em-

3 This new complaint was issued while this case was in the court

of appeals. The court was informed of its issuance by an affidavit

from eounsel, attaching the amended complaint.

ployees log in and out in accordance with the company’s

newly-promulgated work rule. In its opinion the court ex-

plained that the requirements of Boys Markets, Inc. v.

Retail Clerks, 398 U.S. 235 (1970) ... have been met, and

the injunctive relief prayed for should be granted. App.

at 28.

Petitioners appealed to the United States Court of Ap-

peals for the Eighth Circuit. An ‘‘administrative panel’’ of

that court stayed the district court’s injunction and ordered

the briefing expedited. On June 17, 1977, another division

of that court, after hearing oral argument, dissolved the

stay by a 2-1 vote. In its subsequently issued opinion, the

panel majority ‘‘agree[d] with the district court that the

employees violated the work rules in order to incur sus-

pensions for the purpose of disrupting operations at the

plant, and that this activity violated the provisions of

Article XXXIV of the collective-bargaining agreement

[forbidding, inter alia, any interference with the opera-

tions of the Company’’]. App. at 11-12. The majority fur-

ther found that the violations of the work rules and con-

sequent suspensions resulted from a dispute between the

parties“ over matters which were arbitrable. Jd. at 12-13.

Having thus concluded that the refusals to log in and out

were in breach of contract, that they were over“ arbi-

trable disputes, and that no other considerations militated

against issuance of an injunction, the majority ruled that

the case met the literal requirements enunciated in Boys

Markets for issuance of an injunction notwithstanding the

anti-injunction strictures of the Norris-LaGuardia Act.

For purposes of considering the issues presented in this

petition, two features of the majority’s opinion should be

emphasized :

(1) The majority did not find (nor had the district court)

that the employees’ refusals to log in and out interfered

with the company’s production but only that the suspen-

pensions which were visited for this conduct resulted in

such interference. Indeed, the evidence was clear that the

refusals to log in and out could not have interfered with

production (see infra, p. 14). Thus, there was no finding

in either lower court that the refusals to log in and out

exerted pressure upon the company to yield on the pend-

ing disputes without securing an arbitrator’s decision, nor

that they threatened the arbitration process in any other

way.

(2) The majority recognized, but did not decide, peti-

tioners’ claim that the employees’ refusal to log in and out

was a response to unfair labor practices committed by the

company. The majority acknowledged that [this may

well be true,“ but declared:

We do not in this case consider the merits of the

company’s actions; we consider only whether the un-

ion’s reactions created a dispute which the parties had

obligated themselves to resolve through arbitration un-

der the collective-bargaining agreement’’ (emphasis in

original). App. at 7 n.8.

Judge Lay dissented, declaring that the ‘‘majority opin-

ion misconstrues the limited incursion into the Norris-La-

Guardia Act ... authorized by Boys Markets.. App.

at 16. He reasoned, inter alia, that the employees’ conduct

did not in any way threaten the arbitral process (id. at

18-19); that accordingly the injunction contravened the

Norris-LaGuardia Act as construed in Buffalo Forge Co. v.

Steelworkers, 428 U.S. 397 (1976) (id); and that the com-

pany’s harm was self-inflicted, caused by its own decision

to suspend employees for non-disruptive conduct, and thus

unworthy of federal injunctive protection. Judge Lay fur-

ther declared, (id. at 19-20), that the majority’s decision

was in direct conflict with that of the First Circuit in

Anheuser-Busch, Inc. v. Teamsters Local No. 633, 511 F.2d

1097 (1st Cir. 1975), cert. denied, 423 U.S. 875 (1975).

REASONS FOR GRANTING THE WRIT

Introduction

This case presents important issues which have not been

but should be decided by this Court, with respect to the

authority of federal courts to enjoin concerted employee

activity :

(1) May a federal court enjoin concerted action ‘‘over’’

an arbitrable dispute where the concerted action does not

threaten the arbitral process in any way? As we show in

Part I below, in Boys Markets and again in Buffalo Forge

Co. v. Steelworkers, 428 U.S. 397 (1976), this Court recog-

nized a ‘‘narrow’’ exception to the Norris-LaGuardia Act’s

anti-injunction command in order to accommodate the pol-

icy of the Labor-Management Relations Act of 1947

(‘‘LMRA’’) of encouraging and protecting agreed-upon

arbitration processes as means to resolve contractual dis-

putes. This Court ruled that a strike in breach of contract

may be enjoined where it is ‘‘over’’ an arbitrable dispute

and thus would ‘‘interfere with and frustrate the arbitral

processes by which the parties had chosen to settle a dis-

pute. 428 U.S. at 407. A strike in breach of contract de-

signed to effect a resolution of a dispute the parties had

agreed to arbitrate inevitably has such a deleterious effect

on arbitration. But not all concerted activity will have this

effect, and implicit in the rationale of Boys Markets and in

Buffalo Forge, is that other types of employee concerted

action which do not interfere with [or] frustrate the arbi-

tral processes’’ may not, consistent with Norris-LaGuardia,

be enjoined, even though such action may be in breach of

contract and ‘‘over’’ an arbitrable dispute. Without a

threat to the arbitral processes, there is no conflict between

Norris-LaGuardia and the LMRA that would justify an

„exception to the former statute. The First Circuit, in

Anheuser-Busch, Inc. v. Teamsters Local 633, 511 F.2d 1097

cert. denied, 423 U.S. 875 (1975) has made express the im-

plicit requirement of Boys Market and Buffalo Forge that

the concerted action must be such as to threaten the arbitral

process, The court below disagreed, It is important that this

Court resolve that conflict and explicitly state a test that

will, consistent with the rationale of Boys Markets and

Buffalo Forge, not permit unwarranted incursions on the

Norris-LaGuardia Act.

(2) This case presents an important question as to the

interplay between two distinet elements of national labor

policy recognized in decisions of this Court: on the one

hand, the principle of Boys Markets that breaches of con-

tract may be enjoined when they threaten the arbitral

process; and on the other, the principle of Mastro Plastics

Corp, v. NLRB, 350 U.S, 270 (1956), that a strike or other

concerted employee action in response to an employer un-

fair labor practice is not a breach of a union’s contractual

‘*no-strike’’ obligation absent express contract language

inaking that obligation applicable to protests against un-

fair labor practices, When an employer seeks a Boys Mar-

dete injunction against union concerted action, and the

union counters that its action is in response to an employer

unfair labor practice and thus not in breach of contract,

how are the principles of Boys Markets and Mastro Fas-

fics to be veconciled? The response of the court below was

that Boys Markets injunctions, if otherwise warranted,

should be issued without any consideration of the union's

claim that the concerted employee action to be enjoined is

heing taken in response to an employer unfair labor prac-

tice, But, as we show in Part II below, this would mean that

courts would be enjoining concerted activity which may be

perfectly proper—the core evil the Norris-LaGuardia Act

was designed to prevent. Given the freqency of concerted

responses to employer unfair labor practices, it is essen-

tial that this Court articulate the standards which apply

when an employer's invocation of Boys Markets collides

with a union's invocation of Mastro Plastics.

In Boys Markets, this Court created a narrow“ excep-

tion, 398 U.S, at 255, to the Norris-LaGuardia Act's general

prohibition of injunctions in labor disputes. That exception

was grounded wholly on the need to accommodate the pro-

hibition of Norris-LaGuardia with the policy of the LMRA

favoring agreed upon arbitration processes as a means to

resolve contractual disputes, This purpose is clear in (i) the

Boys Markets decision itself; (ii) its parent, the dissenting

opinion in Sinclair Refining Co. v. Atkinson, 370 U.S, 195

(1962); and (iii) its offspring, Buffalo Forge Co, v. Steel.

workers, 428 U.S. 397 (1976). In Sinclair the dissenters

agreed with the majority that che Norris-LaGuardia Act

precludes courts from enjoining concerted activities simply

because those activities are ‘breaches of private con-

tracts.“ 370 U.S. at 275. The dissenters argued, however,

that Congress’ later adoption of legislation designed to

foster voluntary arbitration as the means for resolving

contract disputes created on additional public policy’’

which would be“ threatened“' in certain circumstances were

injunctions not available to protect the arbitral process,

and thus that Norris-LaGuardia had to be ‘‘accommodated”’

to this later legislation. Id. In Boys Markets, the Court

adopted the Sinclair dissenters’ views and created the

„narrow“ exception to Norris-LaGuardia anti-injunction

command to implement ‘‘the congressional policy favoring

the voluntary establishment of a mechanism for the peace-

ful resolution of labor disputes, 398 U.S. at 253. Thus,

under Boys Markets, a party who has agreed to submit

disputes to arbitration and then, in breach of contract, re-

sorts to economic force to coerce the other side to concede

on the issue before it reaches the arbitrator can be enjoined

from so doing in order to protect the arbitral forum. In

such circumstances, as this Court put it in Buffalo Forge,

‘tinjunctions pending arbitration are essential to carry out

promises to arbitrate’’ 428 U.S, at 411 (emphasis added).

But absent such ‘‘necessity,’’ id, at 412, injunctions are not

permitted; as the Buffalo Forge Court explained:

The driving force behind Boys Markets was to imple-

ment the strong congressional preference for the pri-

vate dispute settlement mechanisms agreed upon by the

parties, Only to that extent was it held necessary to

necommodate § 4 of the Norris-LaGuardia Act to § 301

of the Labor-Management Relations Act and to lift the

former’s ban against the issuance of injunctions in

labor disputes, Striking over an arbitrable dispute

would interfere with and frustrate the arbitral proc-

geren by which the parties had chosen to settle.

Section 301. assigns a major role to the courts in

enforcing collective bargaining agreements, but aside

from the enforcement of the arbitration provisions

permitted by Boys Markets, the Court has never indi-

cated that the courts may enjoin actual or threatened

contract violations despite the Norris-LaGuardia Act.

Id. at 407, 409.

Although the rationale of the Boys Markets exception to

Norris-LaGuardia is to protect the arbitral process, the

court below articulated the applicable standard for issuing

Boys Markets injunctions in a manner that would allow

injunctions to issue absent any threat to arbitration, It

stated :

[Wie conclude that Boys Markets and later cases

authorize the issuance of an injunction when §1) the

union is engaged in a strike or other violation of a ‘‘no

strike’’ clause of a collective-bargaining agreement, if

(2) the violation was precipitated by a dispute between

the parties, which dispute is (3) subject to mandatory

uvievance or arbitration procedures provided for in the

agreement, and (4) issuance of the injunction is other-

wise warranted unden ordinary principles of equity.

App. at 10.

That statement is true to the literal language of Boys

Markets. But it omits an additional element implicit in and

critical to the decision’s rationale: to come within the Boys

Markets exception the concerted conduct sought to be en-

joined must be of a nature that ‘‘would interfere with and

frustrate the arbitral processes.“ Buffalo Forge, supra, 428

U.S. at 407,

In Boys Markets itself it was not necessary for the Court

to make this additional element explicit, since in the fact

pattern involved there this element was necessarily satis-

fied by proof of the other elements, The concerted activity

sought to be enjoined in Boys Markets was a strike, which,

by its very nature, was designed to disrupt production and

thereby exert pressure on the employer to yield to the

union’s position on the underlying dispute instead of await-

ing the arbitrator's decision for which the parties had con-

tracted, Thus, proof that a strike in breach of contract is

occurring over an arbitrable dispute necessarily establishes

that the arbitral process is being ‘‘interfere(d] with and

frustrate[(d].’’

But no law of nature dictates that employees can mani-

fest dissatisfaction with their employer 's conduct only by

striking, Other alternatives are available which may vio-

late the contract but do not jeopardize production and

hence do not threaten the arbitral process, In particular,

as here, employees may manifest their disapproval of work

rules promulgated by their employer by disobeying those

rules, without in any way threatening the availability of

the arbitral forum as the final means for resolving whether

the rules were properly promulgated. Such disobedience of

work rules can constitute a breach of contract. But plainly

work rales come in all varieties, from the trivial to the

vital, and not every such breach—or every concerted such

breach—will threaten the arbitral process. In such cases,

proof of the implicit element of Boys Markets—that the

violation ‘‘interfere(s)] with and frustrate[s]’’ arbitra-

tion—is necessary to assure that the Norris-LaGuardia

Act is not violated without any countervailing furtherance

of the policies of the LMRA.

The instant case illustrates the point perfectly. The

courts below did not find—nor could they have found—that

the injunction was ‘‘essential’’ to avoid frustrating the ar-

bitral process. The conduct that was enjoined, violations of

the work rule requiring employees to log in and out, posed

no threat of coercing the company to concede on the arbi-

trable issues, because the violations in no way impaired

production; the very fact that until March 14, 1977 NRT

had never had a logging! rule and that four days after

adopting the rule NRI offered to suspend its enforcement

establishes that compliance with the rule was in no way

nevessary to production.“ Production was slowed solely be-

cause of NRI's self-destructive response to the concerted

uctivity—inass suspensions—not by the activity itself. Yet

the courts below, by applying the language of Boys Markets

literally and formalistically and ignoring the implicit ele-

ment of the Boys Markets test, held the violations enjoin-

able simply because they occurred ‘‘over’’ an arbitrable

dispute,

The court below found that petitioners had violated the work

rule with the intent to ‘‘incur suspensions’’ and that for that

reason their conduct violated the section of the collective bargaining

agreement prohibiting other interference|s| with the operations

of the Company. App, at 11-12. By #o holding, the court effec-

tively construed this language as constituting a promise to refrain

from disobeying work rules in an effort to provoke suspensions, But

whatever the merits of this holding as a matter of contract inter-

pretation, it has no bearing on the critical Boys Markets issue

whether the breach of contract threatens the arbitral process, On

that issue, as we show in text, the evidence is undisputed: the

breach had no such effect.

Indeed, on this record, the only conduct that can be said to have

threatened arbitration was NRI's actions in suspending persons

violating the work rules, The effect of his behavior was to exert

economic pressure on petitioners to concede on an important arbi-

trable issue; viz, whether NRI could refuse to 1 grievances

so long as the local president was a member of the grievance com-

mittee. That this was indeed the Company's oo was revealed

when four days after P the work rules the com

uffered to cense enforcing them if USWA would concede on this

issue.

In adopting this interpretation, the Eighth Cireuit ren-

dered a decision that cannot be squared with the First Cir-

cuit’s decision in Anheuser-Busch, Inc, v. Teamsters Local

698, 511 F.2d 1097, cert, denied, 423 U.S, 875 (1975). In

Anheuser-Busch the employer promulgated a rule prohibit-

ing employees from wearing tank top (sleeveless) shirts.

Within a few days all but a handful of employees in two

departments had been suspended for violating the rule,

and production was halted, The employer sought an in-

junction against further violations of the rule, contending

that the employees were engaged in a ‘‘concerted interfer-

ence with brewery operations“ for the purpose of manifest.

ing their objection to employer conduct which was arbi-

trable, .., the adoption of the rule, Id. at 1100, The viola-

tion, then, was ‘‘over’’ an arbitrable dispute. Yet the

court of appeals reversed the district court’s decision

granting relief, holding that“ the limited incursion upon the

Norris-LaGuardia Act which was authorized by Boys Mar-

kets is insufficient to support the injunction issued below.“

Id. at 1099. In his opinion for the court, Chief Judge Coffin

articulated the holding in terms of the absence of ‘‘irre-

parable injury’’—the fourth Boys Markets requirement in

the Kighth Cireuit’s formulation—reasoning that an em-

ployer cannot be permitted to qualify for injunctive relief

simply by responding to minor employee infractions in a

way that brings serious and irreparable damage upon him-

self by causing a shutdown.“ Jd, But to say that the injury

inflicted by violation of the work rule was not itself ‘‘irre-

parable’’ is simply another way of saying that to obtain

an injunction an employer must prove that it has suffered

a certain type of injury—economic loss which places pres-

sure upon the employer to surrender its position short of

arbitration and thus ‘‘interfere[s] with and frustratels]!“

the arbitral processes. That is, indeed, the point Judge

Coffin made in the penultimate paragraph of ‘is opinion:

Here ... there has been on the employer's part nothing

more than the undifferentiated claim that there exists

a right to make and enforce rules pending the outcome

of a grievance and arbitration procedure, and we reject

the contention that the labor injunction is available in

the ordinary course of events as an enforcement mech-

anism, Id. at 1100.

The court below strove mightily to distinguish Anheuser-

usch away, It reasoned that the injury to NRI threatened

hy continued disruptions of employees... is clearly greater

than the potential harm of having one’s employees present

un unsightly appearance to visitors at the plant.“ App. at

L5.° We doubt that this is so, But even assuming arguendo

that it were, the court below still would have missed the

point, Every breach of contract probably visits some

quantum of harm, but that does not justify a departure

from Norris-LaGuardia, Tie determinative question is

whether the breach ‘‘interfere[s) with and frustrate[s]

the arbitral processes by which the parties have chosen to

settle the dispute.“ The court below made no finding that

the harm here—not having employees log out before, inter

alia, going to the bathroom—is sufficient to threaten to

coerce the employer to concede the arbitrable issues. Thus

the factual distinction which the court below attempted to

draw ignores the point of Anheuser-Busch, and so is ulti-

mately irrelevant.

The decision below threatens the very integrity of the

Norris-LaGuardia Act by permitting an injunction to issue

where the countervailing policy of the LMRA is not impli-

cated, To protect the Act’s integrity, it is necessary for the

* The court also stated that, Here, NRI did not bring about the

disruption itself by insisting upon enforcement of minor work

rules, The company was willing to, and did in fact suspend enforce-

ment of ita rules pending resolution of the underlying dispute

through arhitration, App. at 15. It is not clear to us how it can be

said that NRI did not bring about the disruption itself’’; the

record on this point is undisputable to the contrary. And the com-

pany's willingness to suspend enforcement’’ proves our point,

not the contrary, for it shows that the rules were sufficiently unim-

portant that their breach did not threaten to frustrate the arbitra-

tion proces,

— — — —

Court to restrict the Boys Markets exception to a scope

justified by its rationale by making explicit the implicit re-

quirement that only those contract violations that ‘‘frus-

trate the arbitral process can be enjoined. For this

reason—and to resolve the conflict between the circuits—

the Court should grant a writ of certiorari.

This case also presents an important question as to the

interplay between two distinct elements of national labor

policy recognized in decisions of this Court: (1) the princi-

ple of Boys Markets that concerted activity im breach of a

collective bargaining contract may be enjoined when it

threatens the arbitral process; and (2) the principle of

Mastro Plastics Corp. v. NLRB, 350 U.S. 270 (1956) that

absent express language (not present here), a contractual

„no strike“ clause will be construed such that concerted

action in response to employer unfair labor practices will

not be considered a breach of the clause. The concerted ac-

tivity which the court below enjoined was in response to

conduct by NRI which not only may have contravened the

collective bargaining agreement but also may have violated

the National Labor Relations Act. Petitioners so believed,

and sought to establish the correctness of their belief by

filing unfair labor practice charges with the NLRB. The

Regional Director, after investigating the charges, decided

that they were meritorious and hence issued a complaint.

And the court below stated that petitioner’s assertion that

NRI had committed multiple violations of the NLRA ‘‘may

well be true.“ App. at 7. Necessarily, then, this case re-

quires the Court to consider the applicability of Boys

Markets to concerted activity undertaken in response to

employer conduct that, albeit creating an arbitrable dis-

pute, is also at least arguably an unfair labor practice.

This Court has never been called upon to apply Boys

Markets in this context ; the cases to date in this Court have

involved strikes which were not alleged to be over employer

unfair labor practices. Automatic application of Boys Mar-

kets in this context would collide with Mastro Plastice Corp.,

a decision the court below totally ignored. In Mastro Plas-

tics the employer sought to discharge employees who had

struck against the employer’s unfair labor practice. The

employer argued that the employees had waived their statu-

tory right to strike by agreeing to a collective bargaining

agreement containing an unqualified pledge that there would

be no strikes during the term of the agreement. This Court

disagreed, holding that absent an explicit provision barring

unfair labor practice strikes, no strike’’ clauses should not

be construed to forbid such strikes. This Court explained

that the ‘‘natural’’ construction of no strike clauses in col-

lective bargaining agreements is that the union has prom-

ised not to strike over ‘‘contractual’’ matters, but has not

waived the employees’ right to strike in response to em-

ployer violations of law:

We believe that the contract, taken as a whole, deals

solely with the economic relationship between the em-

ployers and their employees. It is a typical collective

bargaining contract dealing with terms of employment

and the normal operations of the plant. It is for one

year and assumes the existence of a lawfully designated

bargaining representative. Its strike and lockout clauses

are natural adjuncts of an operating policy aimed at

avoiding interruptions of production prompted by ef-

forts to change existing economic relationships. The

main function of arbitration under the contract is to

provide a mechanism for avoiding similar stoppages

due to disputes over the meaning and application of the

various contractual provisions.

To adopt petitioners’ all-inclusive interpretation of

the clause is quite a different matter. That interpreta-

tion would eliminate, for the whole year, the employees’

right to strike, even if petitioners, by coercion, ousted

the employees’ lawful bargaining representative and,

by threats of discharge, caused the employees to si

membership cards in a new union. Whatever may -

said of the legality of such a waiver when explicitly

stited, there is no adequate basis for implying its exis-

tence without a more compelling expression of it than

appears in. . . the contract. 350 U.S. at 281-38.

Mastro Plastics establishes that if the employer’s conduct

here constitutes an unfair labor practice,“ then the union’s

concerted activity in response did not violate the collective

bargaining agreement.’ And since, under Boys Markets,

only conduct in breach of contract, can be enjoined, it neces-

sarily follows that if the employer violated the NLRA, the

injunction against the union was improper. Such an injunc-

®In Arlan’s Department Store, 133 NLRB 802, 807 (1961), the

Board attempted to limit Mastro Plastics to ‘‘strikes in protest

against serious unfair labor practices.’’ (emphasis added). In our

view—and the view of the commentators, e.g., Cox, The Legal

Nature of Collective Bargaining Agreements, 57 Mich. L. Rev. 1

(1958); Comment, Dow Chemical: Restricting the Availability of

Self-Help Measures in Labor Disputes, 77 Colum. L. Rev. 105

(1977)—this interpretation of Mastro Plastics cannot be squared

with either its language or its reasoning. This Court has never had

occasion to consider the correctness of Arlan’s Department Store.

The issue need not be addressed here, however, because it is clear

that NRI’s conduct—discharging the local union president and

suspending two officers, refusing to meet with union representatives

if the president was included, and finally unilaterally adopting new

work rules—would constitute a serious violation. E. g. Pilot Freight

Carriers, Inc., 224 NLRB 342 (1976) (unlawful discharge and

refusal to bargain) ; Cincinnati Penthouse Club, 168 NLRB 969

(1967) (discharge of single employee). The decision below did not

turn upon a finding that the unfair labor practices here were non-

serious. On the contrary, the court below declared that the

existence of unfair labor practices were irrelevant to its decision.

The no-strike clause here, quoted at p. 6 supra, is virtually

— to the clause involved in Mastro Plastics which provided

5. The Union agrees that during the term of thie agreement,

there shall be no interference of any kind with the operations

of the Employers, or any interruptions or slackening of pro-

duction of work by any of its members. The Union further

agrees to refrain from engaging in any strike or work stoppage

during the term of this agreement. 350 U.S. at 281.

Like the Mastro Plastics clause, the contract provision here is en-

entirely general and makes no reference to unfair labor practice

strikes; as in Mastro Plastics, the clause here is part of a contract

regulating economic relations between the parties and providing for

arbitration of contract disputes.

tion, against concerted activity which, by hypothesis, is

perfectly proper, is the core evil which Norris-LaGuardia

was intended to prevent. This Court has never left room for

such injunctive exercise; that is why its cases establish the

threshold requirement that the conduct to be enjoined be

in breach of contract. In Boys Markets the Court stated the

issue to be decided as whether the ‘‘ Norris-LaGuardia Act

precludes a federal district court from enjoining a strike in

breach of a no-strike obligation . . 398 U.S. at 237.

Similarly, in Gateway Coal Co v. United Mine Workers, 414

U.S. 368 (1874), the Court, after concluding that the work

stoppage was over an arbitrable issue, stated that the an-

swer to the question whether the stoppage is enjoinable

„depends on whether the union was under a contractual

duty not to strike.“ Id. at 380.“ And in Buffalo Forge the

Court rejected the claim that a sympathy strike could be

enjoined before it was decided whether the strike was in

breach of contract. Thus, if the concerted activity here was

over“ an unfair labor practice, it was not enjoinable.

In the court below we suggested that rather than deciding

for itself whether the NRI’s conduct violated the NLRA,

the court should defer to the ongoing NLRB proceedings.“

8 Gateway Coal is similar to this case in that the union contended

that its conduct was not in breach of contract because within the

scope of an ‘‘implied exception’’ to the no-strike clause, there, the

exception allowing employees to refuse to work under abnormally

dangrous conditions. The Court ‘‘agree[d]’’ that a work stoppage

called solely to protect employees from immediate danger. . . can-

not be the basis for . . a Boys Markets injunction,’’ 414 U.S. at

485, but found that the work stoppage in the case before it was

not of this character.

Such a course would have been consistent with the doctrine of

primary jurisdiction’’ which recognizes that even where a court

has the power to grant a requested remedy, ‘‘it may be appropri-

ate to refer specific issues to an agency for initial determina-

tion where that procedure would secure ‘[u]niformity and con-

sistency in the regulation of business entrusted to a particular

agency,’ or where

‘the limited functions of review by the judiciary [would be]

more rationally exercised by preliminary resort for ascertain-

The court below rejected this argument, citing a line of

cases holding, in the court’s words, that ‘‘the district court’s

jurisdiction is not curtailed even if the disputed activity

also constitute an unfair labor practice.“ App. at 8.“

But even if deferral was not appropriate, the alternative

course the court took surely was incorrect. For what the

court held was that it was of no consequence whether the

employer had violated the NLRA; as the court stated:

We do not in this case consider the merits of the com-

pany’s actions; we consider only whether the union’s

reactions created a dispute which the parties obligated

themselves to resolve through arbitration under the

collective bargaining agreement. App. at 7 n. 8.

This refusal to decide the unfair practices issue places the

decision in square conflict with Mastro Plastics. Since, as we

have shown, only concerted activity in breach of contract

can be enjoined under Boys Markets, and since, under

Mastro Plastics, concerted activity in response to unfair

labor practices does not violate a general no-strike clause, it

necessarily follows that if the court did not defer to the

NLRZB it was required to decide for itself whether the em-

ing and interpreting the circumstances underlying legal issues

to agencies that are better equipped than courts by specializa-

tion, by insight gained through experience, and by more flexi-

ble procedure.’ Far East Conference v. United States, 342 U.S.

570, 574-575.’’ Nader v. Allegheny Airlines, 426 U.S. 290, 303-

04 (1976).

10 These cases are not relevant here. The ‘‘disputed activity’’ in

this case—the employees’ concerted refusal to comply with NRI’s

work rule—is not alleged to constitute an unfair labor practice.

Rather, our argument is that the employees’ conduct does not vio-

late the collective bargaining agreement because it was undertaken

in response to unfair labor practices committed by NRI. Thus, here,

unlike the cases on which the court relied, resolution of the unfair

labor practice issue is a necessary prerequisite to deciding whether

the concerted activity is in breach of contract.

We recognize, of course, that deferral here would have meant a

delay before the propriety of issuing an injunction could be de-

cided ; that factor might dictate adoption of the alternative course

discussed in the text.

ployer had committed unfair labor practices." Its failure to

do so means that it has enjoined concerted activity that

arguably is not in breach of contract.

The approach of the court below would in effect extend

Boys Markets to permit injunctions against a proper form

of employee concerted conduct—an unfair labor practice

protest, not in breach of contract. This approach simply

cannot be squared with the central purpose of Norris-

LaGuardia. The importance of deciding the proper proce-

dure to follow—and the proper issues to be decided—in

cases of this type is self-evident. The number of reported

cases dealing with unfair labor practice strikes is elequent

testimony to the frequency with which such strikes occur.“

Indeed, during the period that collective bargaining agree-

ments are in effect such strikes may occur more frequently

than economic strikes, sympathy strikes, or strikes designed

solely to enforce the contract, yet this Court has considered

the applicability of Boys Markets only in the latter contexts.

To provide guidance to the lower courts in this important

area, and to rectify the lower court’s departure from the

principles of Norris-LaGuardia and Mastro Plastics, the

Yourt should grant a writ of certiorari.

1! Such a procedure would parallel that approved by this Court

in NLRB v. Cd C Plywood Corp. 385 U.S. 428 (1967) in which

the Board decides contract issues in resolving unfair labor prac-

tice claims.

12 See, e.g., cases cited in Note, The Unfair Labor Practice Strike,

46 N.Y.U. L. Rev. 988 (1971) ; and BNA, Labor Relations Cumula-

tive Digest and Index, Pars. 52.344, 52.3612, 52.3614, 56.4292,

80.559.

CONCLUSION

For the reasons set forth above, certiorari should be

granted.

Respectfully submitted,

BerNarD KiLEIMAN MicRAEL H. Gorresman

1 East Wacker Drive Rosert M. WEINBERG

Suite 1910 JEREMIAH A. CoLLINs

Chicago, Illinois 60601 Bredhoff, Gottesman,

Cohen & Weinberg

cane on = _— Avenue,

—" Larrison & Washington, D.C. 20036

2101 Main Street CARL B. Fran KEL

Post Office Box 6030 Five Gateway Center

Little Rock, Arkansas Pittsburgh, PA 15222

72216

Attorneys for Petitioners

—

APPENDIX A

UNITED STATES COURT OF APPEATS

FOR THE EIGHTH CIRCUIT

No, 77-1318

Nationa, Rxaxorons [npvustaies,

ETO.,

Appellee, Aprptau from the United

5 Distriet Court for the

Western District of

Unrrep STeeLworkers OF AMER- Arkansas.

10A, ETO,, BT A.,

Appellants.

Submitted: June 17, 1977

Filed: August 30, 1977

Before Gmsox, Chief Judge, Lay and Ross, Circuit Judges.

Ross, Circuit Judge.

Plaintiff-appellee National Rejectors Industries (NRI or

the company) commenced this action in district court seek-

ing money damages and injunctive relief to redress viola-

tions and to compel specific performance of a collective-

bargaining agreement. Defendant-appellants are the United

Steelworkers of America, AFL-CIO (the union), its Local

No. 6178 (the local), and several union officials. Disputes

had arisen between the parties culminating in the suspen-

sion of large numbers of union employees for violations of

company work rules, resulting in a sharp decline in produc-

tivity at the company’s plant. The district court assumed

jurisdiction pursuant to section 301 of the Labor Manage-

ment Relations Act, 1947 (LMRA), 29 U.S.C. §185, and

granted an injunction enjoining, inter alia, further viola-

tions of the work rules, and ordering the parties to submit

their disputes to arbitration proceedings. Pending appeal,

the district court stayed the latter portion of its order, Simi-

larly, an administrative panel of this court stayed the re-

mainder of the order pending resolution on the merits, For

the reasons hereafter stated, we dissolve these stays and

affirm the judgment of this district court.“

NRI is a subsidiary of a Delaware corporation and main-

tains an office and plant in Hot Springs, Arkansas where it

manufactures coin and currency changing devices. The com-

pany employs over 400 persons at its Hot Springs plant,

some 300 of which are production and maintenance workers.

The union and its local have been the exclusive collective

hargaining representatives for the company’s production

and maintenance workers since 1961. The parties have

stipulated that the company is an industry affecting com-

merce within the meaning of sections 2(7) and 301 of the

LMRA, 29 U.S.C. §§152(7) and 185. It is likewise agreed

that the union is a labor organization within the meaning of

section 2(5) of the Act, 29 U.S.C. §152(5), and that it is

engaged in representing employee members in the Western

District of Arkansas. See LMRA §301(¢)(2), 29 U.S.C.

§ 185(¢)(2).

The company and the union are parties to a collective-

‘An order dissolving the stays and reinstating the 12

iasned by the distriet court was entered by this conrt on June 17,

1977, after hearing oral argument of the parties, Judge Lay dis.

venting. :

bargaining agreement.“ Article XXXIV of the agreement

provides that ‘‘there shall be no strikes, slow-ups, stoppages

of work * * * or other interference with the operations of

the Company during the term of this Agreement.’’ Article

XV provides that all disputes concerning the meaning or

application of the agreement be resolved by a four-step

grievance and arbitration procedure.“ Step 1’’ calls for

GRIEVANCE PROCEDURE

Section 1, Should any difference arise between the Company

and the Union or its members employed by the Company as to

the meaning, application or violation of the terms and pro-

visions of t, there shall be no suspension or im-

peding of work on the part of the Union or lockout on the part

of the Com on account of such differences—but an earnest

effort shall be made to settle such differences immediately in the

following manner:

Following are four steps, discussed in text infra.

any grievance to be first submitted by the affected employee

to his foreman, the latter to respond in writing to the griev-

ance. Step 2’’ provides that appeals by either party be

submitted to a meeting between management representa-

tives and the grievance committee of the local union.“ Step

3“ requires further appeals to be resolved at a meeting

between the national organization of the union and repre-

sentatives of company executives. If the dispute is still not

resolved, ‘‘Step 4’’ provides for submission of the matter

to final and binding arbitration, and specifies a method of

selecting an arbiter.

At a meeting in December 1976 an incident occurred

which resulted in the company’s discharging Frankie Joe

Russell, president of the local union, and suspending for

30 days two other officers of the local.“ The union filed griev-

The agreement is dated J 8, 1975, and by its terms will

remain in full Ir. January 15, 1855

* Article XV states in t

* The two were Clois Lishbrook, vice-president,

and Margaret recording secretary.

ances with respect to these actions, Russell and the two

suspended officers were designated members of the local’s

grievance committee for purposes of ‘‘Step 2’’ of the griev-

ance procedure outlined above. When Step 2 negotiations

were reached, the company requested that further proceed-

ings be conducted at the next higher level, over the local’s

grievance committee, in accordance with its interpretation

of Article XV of the collective-bargaining agreement.“ The

union refused, insisting that Russell and the two suspended

officers be involved in the grievance proceedings. The com-

pany in turn refused to meet with Mr. Russell, but remained

willing to proceed at the next higher level, The union then

filed grievances over the company’s refusal to abide by the

5 Section 4 of Article XV states in pertinent part:

Should the actions of the representatives of either party be such

that the integrity of the grievance procedure is threatened, then

the authorized 3rd step representative of the Company or

Union shall notify the opposite party who shall investigate and

report back the results of such investigation and the corrective

action taken, if any. If such report is not satisfactory or if the

facts are in dispute either party may request a meeting for the

purpose of determining the facts and settling the issue, If the

isstie is not satisfactorily settled at this meeting either party

may request the other to take such action as may be appro-

priate and necessary to correct the problem, In this event, the

grievance machinery shall continue to function with the nezt

highest officials of the Company and Union yyy the

meetings to insure the processing of grievances in a timely

manner until such time as both parties are agreed that normal

operation of the grievance procedure can be resumed. (Empha-

sis supplied, )

The company felt Mr. Russell's participation in the negotiations

concerning his own dismissal threatened the — oy of the griev-

ance procedure and requested a union investigation of his conduct.

The union reported back that there was nothing irregular in Mr.

Russell's conduct. This report being unsatisfactory, the company

requested a meeting and one was had, Being still unable to settle

the ene, the company suggested that Mr. removal from

the uvievance committee was necessary to correct the The

company contends that the grievance machinery then have

continued to operate with the next highest union representatives, in

nes dance with the emphasized language of section 4.

APPENDIX A

UNITED STATES COURT OF APPEALS

FOR THE EIGHTH CIRCUIT

No, 77-1318

Nationa, Reszorons Lwpvusraies,

ETO.,

Appellee, Avpraufromti "> sd

District Cour, Ur the

Western District of

Unitep SteeLworkers or Amen- Arkansas.

ICA, kro., BT AL.,

Appellants.

Submitted: June 17, 1977

Filed: August 30, 1977

Before Gisson, Chief Judge, Lay and Ross, Circuit Judges.

Ross, Circuit Judge.

Plaintiff-appellee National Rejectors Industries (NRI or

the company) commenced this action in district court seek-

ing money damages and injunctive relief to redress viola-

tions and to compel specific performance of a collective-

bargaining agreement. Defendant-appellants are the United

Steelworkers of America, AFL-CIO (the union), its Local

No. 6178 (the local), and several union officials. Disputes

had arisen between the parties culminating in the suspen-

sion of large numbers of union employees for violations of

company work rules, resulting in a sharp decline in produc-

tivity at the company’s plant. The district court assumed

jurisdiction pursuant to section 301 of the Labor Manage-

ment Relations Act, 1947 (LMRA), 29 U.S.C. 5 185, and

granted an injunction enjoining, inter alia, further viola-

tions of the work rules, and ordering the parties to submit

their disputes to arbitration proceedings. Pending appeal,

the district court stayed the latter portion of its order. Simi-

larly, an administrative panel of this court stayed the re-

mainder of the order pending resolution on the merits. For

the reasons hereafter stated, we dissolve these stays and

affirm the judgment of this district court.’

NRI is a subsidiary of a Delaware corporation and main-

tains an office and plant in Hot Springs, Arkansas where it

manufactures coin and currency changing devices. The com-

pany employs over 400 persons at its Hot Springs plant,

some 300 of which are production and maintenance workers.

The union and its local have been the exclusive collective

bargaining representatives for the company’s production

and maintenance workers since 1961, The parties have

stipulated that the company is an industry affecting com-

merce within the meaning of sections 2(7) and 301 of the

LMRA, 29 U.S.C. §§152(7) and 185. It is likewise agreed

that the union is a labor organization within the meaning of

section 2(5) of the Act, 29 U.S.C. §152(5), and that it is

engaged in representing employee members in the Western

District of Arkansas. See LMRA §301(c)(2), 29 U.S.C.

§ 185(¢) (2).

The company and the union are parties to a collective-

‘An order dissolving the stays and reinstating the injunction

insured by the district court was entered by this court on June 17,

1977, after hearing oral argument of the parties, Judge Lay dis-

wenting f

bargaining agreement.“ Article XXXIV of the agreement

provides that ‘‘there shall be no strikes, slow-ups, stoppages

of work * or other interference with the operations of

the Company during the term of this Agreement.’’ Article

XV provides that all disputes concerning the meaning or

application of the agreement be resolved by a four-step

grievance and arbitration procedure.“ Step 1“ calls for

GRIEVANCE PROCEDURE

Section 1. Should any difference arise between the Company

and the Union or its members employed by the Company as to

the meaning, application or violation of the terms and pro-

visions of this Agreement, there shall be no suspension or im-

peding of work on the part of the Union or lockout on the part

of the Company on account of such differences—but an earnest

effort shall be made to settle such differences immediately in the

following manner :

Following are four steps, discussed in text infra.

any grievance to be first submitted by the affected employee

to his foreman, the latter to respond in writing to the griev-

ance. Step 2“ provides that appeals by either party be

submitted to a meeting between management representa-

tives and the grievance committee of the local union. ‘‘Step

8’’ requires further appeals to be resolved at a meeting

between the national organization of the union and repre-

sentatives of company executives. If the dispute is still not

resolved, ‘‘Step 4’’ provides for submission of the matter

to final and inding arbitration, and specifies a method of

selecting an arbiter.

At a meeting in December 1976 an incident occurred

which resulted in the company’s discharging Frankie Joe

Rnssell, president of the local union, and suspending for

30 days two other officers of the local.* The union filed griev-

2 The agreement is dated January 8, 1975, and by its terms will

remain in full force and effect until January 15, 1978.

* Article XV states in part:

* The two suspended officers were Clois Lishbrook, vice-president,

and Margaret Sue Loudermill, recording secretary.

ances with respect to these actions. Russell and the two

suspended officers were designated members of the local’s

grievance committee for purposes of Step 2’’ of the griev-

ance procedure outlined above. When Step 2 negotiations

were reached, the company requested that further proceed-

ings be conducted at the next higher level, over the local’s

grievance committee, in accordance with its interpretation

of Article XV of the collective-bargaining agreement.“ The

union refused, insisting that Russell and the two suspended

officers be involved in the grievance proceedings. The com-

pany in turn refused to meet with Mr. Russell, but remained

willing to proceed at the next higher level. The union then

filed grievances over the company’s refusal to abide by the

5 Section 4 of Article XV states in pertinent part:

Should the actions of the representatives of either party be such

that the integrity of the grievance procedure is threatened, then

the authorized 3rd step representative of the Company or

Union shall notify the opposite party who shall investigate and

report back the results of such investigation and the corrective

action taken, if any. If such report is not satisfactory or if the

facts are in dispute either party may request a meeting for the

purpose of determining the facts and settling the issue. If the

issue is not satisfactorily settled at this meeting either party

may request the other to take such action as may be appro-

priate and necessary to correct the problem. In this event, the

grievance machinery shall continue to function with the next

highest officials of the Company and Union conducting the

meetings to insure the processing of grievances in a timely

manner until such time as both parties are agreed that normal

operation of the grievance procedure can be resumed. (Empha-

sis supplied. )

The company felt Mr. Russell’s participation in the negotiations

concerning his own dismissal threatened the integrity of the griev-

ance procedure and requested a union investigation of his conduct.

The union reported back that there was nothing irregular in Mr.

Russell’s conduct. This report being unsatisfactory, the company

requested a meeting and one was had. Being still unable to settle

the issue, the company suggested that Mr. Russell’s removal from

the grievance committee was necessary to correct the problem. The

company contends that the grievance machinery should then have

continued to operate with the next highest union representatives, in

accordance with the emphasized language of section 4.

grievance procedures. At this point, negotiations between

the parties reached an impasse.

On January 13, 1977, the union filed charges against the

company with the National Labor Relations Board (NLRB),

alleging that the dismissal and suspensions of the local offi-

cers constituted unfair labor practices under section 8 of the

National Labor Relations Act, 29 U.S.C. 5158, in violation

of rights guaranteed in section 7 of the Act, 29 U.S.C. 5157.

On February 22nd, the NLRB filed a complaint against the

company incorporating these allegations.

In early March 1977 the company promulgated six new

work rules for employees at the Hot Springs plant.“ The

union was given notice of these rules, but again refused to

negotiate with the company without Mr. Russell being

present as a representative. The company then placed the

rules into effect on March 14. Clois Lishbrook, acting presi-

dent of the local in the absence of Mr. Russell, told company

representatives that she did not intend to comply with the

The new work rules read as follows:

1. ee eS ee ee ee eee ae

— 1 ——— 1122

All employees are required to log into and out of their

personnel i

for NRI, testified that the company had experienced problems with

employees leaving their work areas without authorization since

November of 1976.

new rules and stated that she did not think any of the other

union employees should comply with them either.

Under procedures established by the company for enfore-

ing its work rules, an empioyee was given a verbal warning

following his first violation; a second violation resulted in

a written warning. Following a third violation, the employee

was informed that further violations would result in his

being temporarily suspended.

Within four days after the new rules went into effect,

138 employees had been suspended for violating them. The

union immediately filed grievances with respect to each of

these suspensions. By this time, production at the plant had

dropped to 30% of normal. In an effort to maintain an

active work force, the company decided on March 18 to

suspend further enforcement of the rules.’ Later that day,

the company notified the union that it was willing to waive

the intermediate steps of the grievance procedure and begin

immediate arbitration on all the grievances theretofore filed

by the union. The company also offered to continue suspend-

ing enforcement of the work rules pending resolution of

these grievances through arbitration. When the union re-

fused, the company sought relief in the district court.

The district court found that, by violating the work rules,

union employees had engaged in concerted activity calcu-

lated to slow up and impede production at the plant, that

this activity was precipitated by disputes then exising be-

tween the union and the company, that these disputes were

arbitrable and, therefore, that these actions violated Arti-

cles XV and XXXIV of the collective-bargaining agreement.

Accordingly, the court entered its order enjoining further

union efforts to impede production at the plant and requir-

7 Violations of rules 3 and 4, relating to logging in and out

procedures (see note 5 supra) were involved in each of the 138

employee suspensions. It was enforcement of these two rules which

the company suspended.

ing thegarties to submit their disputes to arbitration. The

union responded by filing this appeal.

II.

We are confronted at the outset with the union’s con-

tention that the instant case falls within the exclusive juris-

diction of the NLRB, thus depriving the district court of its

power to issue an injunction. This argument is based on the

preemption doctrine, announced in San Diego Trades Coun-

cil v. Garmon, 359 U.S. 236 (1959), which teaches that

„when an activity is arguably subject to 57 or 48 of the

[National Labor Relations] Act, the States as well as the

federal courts must defer to the exclusive competence of the

National Labor Relations Board if the danger of state inter-

ference with national policy is to be averted.’’ Id. at 245.

The union asserts that the company’s dismissal of

Frankie Joe Russell, its subsequent refusal to meet with

him, and its promulgation of the new work rules are unfair

labor practices under § 8 of the National Labor Relations

Act, 29 U.S.C. § 158. This may well be true, though the ques-

tion is not before us.“ It does not follow, however, that such

a conclusion would serve to divest the district court of juris-

diction in this case, which was brought to enforce the terms

of a collective-bargaining agreement under 5 301 (a) of the

LMRA, 29 U.S.C. §185(a).® It has long been recognized

s We do not in this case consider the merits of the company’s

actions; we consider only whether the union’s reactions created a

dispute which the parties had obligated themselves to resolve

through arbitration under the collective-bargaining agreement.

Section 301 (a) provides:

Suits for violation of contracts between an employer and a

labor organization representing employees in an industry

affecting commerce as defined in this chapter, or between any

such labor organizations, may be brought in any district court

of the United States having jurisdiction of the parties, without

respect to the amount in controversy or without regard to the

citizenship of the parties.

that, by its enactment of § 301, Congress deliberately chose

to leave the enforcement of collective agreements ‘to the

usual processes of the law.. Charles Dowd Box Co., Inc. v

Courtney, 368 U.S. 502, 513 (1962). Thus, in cases brought

under § 301, the district court’s jurisdiction is not curtailed

even if the disputed activity also constitutes an unfair labor

practice. Farmer v. United Brotherhood of Carpenters and

Joiners of America, Local 25, 45 U.S.L.W. 4263, 4265 n.8

(U.S. Mar. 7, 1977); William E. Arnold Co. v. Carpenters

District Council of Jacksonville, 417 U.S. 12, 16 (1974).

Accordingly, we reject the union’s claim that the NLRB

has exclusive jurisdiction over the subject matter of this

case.

III.

The union next contends that the distriet court was pre-

cluded from issuing an injunction by the anti- injunetion

provisions of the Norris-LaGuardia Act.’ In making this

argument the union candidly acknowledges that in Boys

Markets v. Retail Clerks Union, 398 U.S. 235 (1970), the

Supreme Court recognized an exception to Norris-

LaGuardia’s anti-injunction provisions in certain cases

brought under 5 301." It nevertheless insists that this ex-

ception does not apply to the facts of the instant case. We

therefore begin our consideration of the union’s claim by

examining the scope of the Boys Markets exception.

In Boys Markets the employer and the union were parties

to a collective-bargaining agreement containing, inter alia,

a ‘‘no-strike’’ obligation and provisions for resolution of all

disputes arising under the contract through mandatory

10 Section 4 of the Norris-LaGuardia Act, 29 U.S.C. § 104, pro-

vides in part:

No court of the United States shall have jurisdiction to issue

any restraining order or temporary or permanent injunction in

any case involving or growing out of any labor dispute * .

11 99 U.S.C. § 185, quoted in part in note 8, supra.

adjustment and arbitration procedures. A dispute arose

between the parties when the union demanded that super-

visory employees cease performing tasks claimed to be

union work. The union struck when this demand was re-

jected. The employer sought injunctive relief under 4 301

to halt the strike, admitted to be a violation of the no-strike

clause of the contract. The union defended in part on the

basis of Norris-LaGuardia’s anti-injunction provisions. The

Supreme Court was thus called upon to balance the conflict-

ing policies embodied in Norris-LaGuardia’s apparent flat

ban against injunctions on the one hand, and the authority

conferred by § 301 to resolve contract disputes on the other.

After reviewing the history of both statutes, the Court

struck this balance by declaring that ‘‘ Norris-LaGuardia’s

policy of nonintervention by the federal courts should yield

to the overriding interest in the successful implementation

of the arbitration process.’’ 398 U.S. at 252. The rationale

of this decision is apparent:

Indeed, the very purpose of arbitration procedures is

to provide a mechanism for the expeditious settlement

of disputes without resort to strikes, lockouts, or other

self-help measures. This basic purpose is obviously

largely undercut if there is no immediate, effective

remedy for those very tactics that arbitration is desig-

nated to obviate.

We conclude, therefore, that the unavailability of equi-

table relief in the arbitration context presents a serious

impediment to the congressional policy favoring the

voluntary establishment of a mechanism for the peace-

ful resolution of labor disputes, that the core purpose

of the Norrig-LaGuardia Act is not sacrificed by the

limited use of equitable remedies to further this im-

rtant policy, and consequently that the Norris-

PaGuardia Act does not bar the granting of injunctive

relief in the circumstances of this case.

398 U.S. at 249, 253. In reaching its conclusion, the Court

cautioned that its holding was a narrow one. * * We deal

only with the situation in which a collective-bargaining con-

tract contains a mandatory grievance adjustment or arbi-

tration procedure.“ Id. at 253. Cases decided subsequent to

Boys Markets have made it clear that an injunction is ap-

propriate only when such relief is necessary to compel

specific performance of the mandatory arbitration pro-

visions of the contract. See Buffalo Forge Co. v. Steelwork-

ers, 428 U.S. 397, 409 (1976). Thus, it is not the strike itself,

or the violation of a no-strike clause that it represents, that

will be enjoined. It is essential in each case that the activity

being enjoined represents a union response to a dispute over

a grievance which the union was contractually bound to

arbitrate. Id. Finally, adopting the principles expressed in

the dissenting opinion in Sinclair Refining Co. v. Atkinson,

370 U.S. 195 (1962), the Court has required that:

Beyond this, the District Court must, of course, con-

sider whether issuance of an injunction would be war-

ranted under ordinary principles of equity—whether

breaches are occurring and will continue, or have been

threatened and will be committed; whether they have

caused or will cause irreparable injury to the employer;

and whether the employer will suffer more from the

denial of an injunction than will the union from its

issuance.

Boys Markets, supra, at 254, quoting from Sinclair, supra,

at 228.

Summarizing, we conclude that Boys Markets and later

cases authorize the issuance of an injunction when (1) the

union is engaged in a strike or other violation of a ‘‘no

strike“ clause of a collective-bargaining agreement, if (2)

the violation was precipitated by a dispute between the

parties, which dispute is (3) subject to mandatory grievance

or arbitration procedures provided for in the agreement,

and (4) issuance of the injunction is otherwise warranted

under ordinary principles of equity.

Applying these principles to the facts of the instant case,

we conclude that the district court properly issued an in-

junction against further disruptions of the company’s op-

erations in conjunction with its order to arbicrate.

(A) Union employees, by refusing to comply with the

— rules, violated ihe terms of the 245 strike

clause.

Article XXXIV of the collective-bargaining agreement

provides that, during the term of the contract, there ‘‘shall

be no strikes, slow-ups, stoppages of work, sit-down strikes,

refusals to handle merchandise, material or equipment or

other interference with the operations of the Company.

(Emphasis supplied.) The district court found that union

employees at the Hot Springs plant violated the company’s

work rules in order to incur suspensions for the purpose of

disrupting operations at the plant. The union does not chal-

lenge the accuracy of this finding and we conclude that sub-

stantial evidence in the record supports it. The testimony

establishes that under company procedures suspension of

an employee resulted only after the employee had violated

the work rule at least four times. Prior violations were dealt

with by giving the employee a verbal warning, a written

warning, and notice that further violations would result in

suspension. The work rules here in question involved a rela-

tively simple procedure of writing one’s name in a company

log book before leaving his assigned work station during

business hours. Nevertheless, some 138 employees managed

to violate the rules a sufficient number of times to incur

suspension within only three working days after the rules

were placed in effect. In addition, the acting president of the

local union expressed to representatives of the company her

intention to disregard the rules and her belief that other

employees should do the same. This testimony is wholly un-

rebutted by the union.

Accordingly, we agree with the district court that the

employees violated the work rules in order to incur suspen-

sions for the purpose of disrupting operations at the plant,

and that this activity violated the provisions .of Article

XXXIV of the collective-bargaining agreement.”

(B) and (C) The violation of the ‘‘no strike’’ clause

was precipitated by a dispute between the parties over

a grievance subject to arbitration under the collective-

bargaining agreement.

There can be no question on the record before us that the

violations of the work rules and consequent suspensions re-

sulted from a dispute between the parties. The district court

concluded only that this dispute was over grievances ‘‘ then

existing“ between the parties having to do with interpre-

tation of the Collective Bargaining [Agreement] and opera-

tions and procedures thereunder.’’ Whether these griev-

ances related to the dismissal of Frankie Joe Russell and the

suspensions of the other two officers, or whether they re-

lated to dissatisfaction with the work rules themselves, or

both, there is no contention made that such grievances

would not be subject to the grievance and arbitration pro-

cedures specified in the contract. Indeed, the union has filed

numerous grievances with respect to each in an attempt to

invoke those procedures.

The essence of the union’s argument is that the com-

pany’s unwillingness to meet with Mr. Russell as a member

of the local’s grievance committee made arbitration an im-

possible goal since Step 2’’ of the grievance procedure

leading to arbitration could never be completed. We reject

this argument for two reasons. First, we are convinced that

the issue of whether completion of Step 2’’ is a condition

precedent to arbitration itself presents an arbitrable dis-

pute under the terms of Article XV of the agreement. Sec-

tion 4 of that Article specifies circumstances in which“ Step

2’’ meetings are not required when the conduct of either

12 The union’s contention that no injunction can issue because

there was no ‘‘strike’’ as such is without merit. See Avco Corp. v.

Local No. 787, UAW, 459 F.2d 968, 974 (3rd Cir. 1972) (enjoining

employee refusal to work overtime. )

party ‘‘threatens the integrity’’ of the grievance pro-

cedure.” Section 1 of that Article broadly makes all ques-

tions concerning the meaning or application“ of the

provisions of the contract subject to the specified grievance

and arbitration procedures. We conclude that this language

encompasses the dispute concerning the necessity of com-

pleting Step 2’’ before proceeding to arbitration.““ Second,

we are unpersuaded that questions concerning the proce-

dural aspects of resolving a dispute of this kind present a

bar to arbitration.

Once it is determined, as we have, that the parties are

obligated to submit the subject matter of a dispute to

arbitration, ‘‘procedural’’ questions which grow out of

the dispute and bear on its final disposition should be

left to the arbitrator.

[Wie think it best accords with the usual purposes of

an arbitration clause and with the policy behind federal

labor law to regard procedural disputes but as aspects

of the dispute which called the grievance procedures

into play.

John Wiley & Sons v. Livingston, 376 U.S. 543, 557, 559

‘ (1964) (emphasis supplied).

(D) An injunction was warranted in the circumstances

of this case under general principles of equity.

The district court found, and it is undisputed, that follow-

ing the suspensions of employees for violating the work

rules, production at the company’s plant dropped to 30% of

normal. The record also establishes that continued inter-

18 See note 4, supra.

14 We are bolstered in our conclusion by the Supreme Court’s

consistent recognition of the presumption favoring a finding of

arbitrability as a means of implementing the ‘‘ well-established fed-

eral labor policy favoring arbitration as the means of resolving dis-

putes over the meaning and effect of collective-bargaining agree-

„Inc. v. Local No. 358, Baker & Conf ection-

ery Workers, 45 U.S.L.W. 4251, 4254 (U.S. Mar. 7, 1977).

ferences with production will result in lower output, delays

in deliveries, and may result in failures by the company to

perform existing contracts and in securing future contracts.

In light of our conclusion that the suspensions were stimu-

lated by the employees’ desire to disrupt operations at the

plant, we likewise conclude that the company’s willingness

to suspend enforcement of the work rules does not preclude

the district court’s finding that irreparable injury will re-

sult to the company if an injunction against future disrup-

tions is not granted. It is likewise undisputed that the com-

pany was at all times prepared to proceed to a resolution of

its disputes with the union through arbitration. Finally, the

union offered no evidence of how it would be injured if an

injunction was granted, with the exception of its claim that

the local would be deprived of the services of Frankie Joe

Russell as its representative. In these circumstances, we

conclude that an injunction against further union disrup-

tions of company operations, and ordering the parties to

proceed to arbitration, was justified.

Anheuser-Busch, Inc. v. Teamsters Local No. 633, 511

F.2d 1097 (Ist Cir.), cert. denied, 423 U.S. 875 (1975), the

case primarily relied upon by the union, is not to the con-

trary. In that case the employer instituted a work rule pro-

hibiting employees from wearing ‘‘tank-tops’’ to work.

When the employees persisted in wearing such attire, the

employer suspended them, thereby effectively shutting

down the plant. The court reversed an order of the district

court granting an injunction, saying ‘‘an employer cannot

be permitted to qualify for injunctive relief simply by re-

sponding to minor employee infractions in a way that brings

serious and irreparable damage upon himself by causing a

shutdown. Id. at 1099. In considering the potential harm

to the employer in the absence of an injunction, the eourt

concluded that [hlaving some employees wear tank-tops,

even during the summer when there are likely to be more

than the usual nuunber of persons touring the plant, cannot

be considered the type of injury properly providing a basis

for injunctive relief.’’ Jd. at 1100.

We see no analogy between the facts presented in An-

heuser-Busch and those in the instant case. Here, NRI did

not bring about the disruption itself by insisting upon en-

forcement of minor work rules. The company was willing to,

and did in fact suspend enforcement of its rules pending

resolution of the underlying dispute through arbitration. In

addition, the injury to NRI threatened by continued disrup-

tions of employees at the Hot Springs plant, even in the

absence of work rules, is clearly greater than the potential

harm of having one’s employees present an unsightly ap-

pearance to visitors at the plant. We think these factors

sufficiently distinguish this case from the situation pre-

sented in Anheuser-Busch. The court there appears to have

foreseen this distinction and carefully limited the rule it

was announcing, saying:

Our holding here should not be taken as one that an

employer will never be successful in demonstrating that

he will be seriously and irreparably harmed if pre-

vented from effectively enforcing a work rule pending

arbitration. * * * [I]n another case, there might be an

adequate showing that employee disregard of work

rules was seriously undermining an — *s ability

to conduct his business. Here, however, there has been

on the — — part nothing more than the undif-

ferentiated claim that there exists a right to make and

enforce rules pending the outcome of a grievance and

arbitration procedure, and we reject the contention that

the labor injunction is available in the ordinary course

of events as an enforcement mechanism. * * * We hold

merely that in this case there was aot a showing of

tential inj to elief under -

Id. at 1100 (emphasis supplied).

In conclusion, we are satisfied that the district court ap-

plied the appropriate standards for determining whether

an injunction should issue, and that his order conforms with

the spirit of the narrow exception to the Norris-LaGuardia

Act created by Boys Markets. Accordingly, the judgment of

the district court should be and is affirmed.

Lay, Circuit Judge, Dissenting.

The majority opinion miscontrues the limited incursion

into the Norris-LaGuardia Act, 29 U.S.C. § 104, authorized

by Boys Markets v. Retail Clerks Union, 398 U.S. 235

(1970). As explained in Buffalo Forge Co. v. Steelworkers,

428 U.S. 397, 402 (1976), the limited authority which Boys

Markets granted to a federal court to enjoin a strike in vio-

lation of a no-strike clause within a collective bargaining

agreement is applicable only when the strike is over the

arbitrable dispute. In the present case the record is clear

that the dispute which led to the refusal to arbitrate is not

related to the alleged violation of the no-strike clause.

Rather, the dispute arises from the inability of the company

and the union to agree on the proper grievance procedures.

The fundamental grievance involved in the present case

relates to the discharge of an employee who is a union rep-

resentative. The union is willing to submit this issue to the

grievance and arbitration procedures set forth under the

contract. Tangentially, there now exists a grievance over

the implementation of a petty work rule requiring, inter

alia, employees to sign in and out when going to the bath-

room. The union is willing to submit this dispute to griev-

ance and aribtration procedures as well. The company has

indicated that it is willing to submit these issues to arbitra-

tion but refuses to negotiate grievances with the union if

the discharged union representative is present. The union

insists that the union representative be present; thus the

parties have reached an impasse.’ It should be plain enough

The company is willing to suspend the work rules if the union

is willing to acquiesce in the company’s proposed grievance pro-

cedure. I think the obvious inference follows that the implementa-

tion of the work rule by the company was in retaliation to the

that refusal to arbitrate in this case is not related to the

enforcement of the work rule, or to the employees’ refusal

to follow the work rule, or to the company’s suspensions for

violation of the same. The impasse reached relates to the

procedural steps to be followed in implementation of the

grievance and arbitration procedures under the contract. At

issue is a matter of contract interpretation, and although a

procedural question is presented it is now well-settled that

procedural issues as well as substantive questions are ex-

clusively for the arbiter. See John Wiley c Sons v. Living-

ston, 376 U.S. 543, 557 (1943); Drivers Local No. 120 v.

Sears, Roebuck & Co., 535 F.2d 1072, 1075 (8th Cir. 1976).

Although the majority agrees with this premise, it finds a

violation of the no-strike clause of the contract resulting

from the employees’ noncompliance with work rules and

thus encroaches upon the arbiter’s exclusive jurisdiction.

Cf. Buffalo Forge Co. v. Steelworkers, supra. In thus inter-

preting the contract the majority ignores the decisions of

this court and other courts which have uniformly held that

the interpretation of the collective bargaining agreement

lies within the exclusive domain of the arbiter. See e.g.

Drivers Local No. 120 v. Sears, Roebuck d Co. supra, at

1075.

Relying upon John Wiley & Sons v. Livingston, supra, the

majority finds that the union’s insistance on following the

procedural steps set out in the contract cannot be a bar to

arbitration over the disputes. As valid as this view may be,

it does not follow from Wiley, as the majority concludes

that the procedural impasse reached necessarily grows out

of the arbitrable dispute authorizing injunctive relief pend-

ing arbitration. Wiley clearly does not come close to holding

this. This view ignores the fact that the union is ready and

willing to submit the issue over the discharge (or anything

else) to the grievance and arbitration procedure under the

union’s refusal to arbitrate without the discharged union repre-

sentative present.

contract. What the union refuses to do is to acquiesce in the

company’s interpretation of the grievance clause as to the

procedure to be followed. The Wiley decision does provide

the solution for the present case. The district court should

limit its order to require the parties to submit the pro-

cedural issue and at least the related issue of the discharge

to arbitration.

Both Anheuser-Busch, Inc., v. Teamsters Local No. 633,

511 F.2d 1097 (1st Cir. 1975), cert. denied, 423 U.S. 875

(1975), and Buffalo Forge indicate that the court may order

arbitration without issuing a plenary injunction affecting

the no-strike clause. In Anheuser-Busch the court made

clear in its conclusion that the union was willing to arbitrate

and no limited order was necessary. In Buffalo Forge the

Court explicitly acknowledged that the employer was en-

titled to an order requiring the union to arbitrate if the

union refused to do so. However, as the Court observed:

[It does not follow that the District Court was em-

powered not only to order arbitration but to enjoin the

strike pending the decision of the arbitrator, despite

the express prohibition of §4(a) of the Norris-

LaGuardia Act against injunctions prohibiting any per-

son from ‘‘[e]Jeasing or refusing to perform any work

or to remain in any relation of employment.“

428 U.S. at 410.

Here, the district court should stay the issuance of its in-

junction as it relates to enforcing the work rule pending

arbitration and resolution of the procedural issue involved.

The majority decision allows the federal court to inter-

vene in a breach of contract case and violate the narrow

jurisdictional basis afforded the court in Boys Markets. As

Mr. Justice White stated in Buffalo Forge:

If an injunction could issue against the strike in this

case, so in proper circumstances could a court enjoin

any other alleged breach of contract pending the ex-

haustion of the applicable grievance and arbitration

provisions even though the injunction would otherwise

violate one of the express prohibitions of 54. The court

in such cases would be permitted, if the dispute was

arbitrable, to hold hearings, make findings of fact, in-

terpret the applicable provisions of the contract and

issue injunctions so as to restore the status quo or to

otherwise regulate the relationship of the parties pend-

ing exhaustion of the arbitration process. This would

cut deeply into the policy of the Norris-LaGuardia Act

and make the courts potential participants in a wide

range of arbitrable disputes under the many existing

and future collective-bargaining contracts, not just for

the purpose of enforcing promises to arbitrate, which

was the limit of Boys Markets, but for the purpose of

reliminarily dealing with the merits of the factual and

egal issues that are subjects for the arbitrator and of

issuing injunctions that would otherwise be forbidden

by the Norris-LaGuardia Act.

428 U.S. at 410-11 (footnotes omitted).

Even assuming injunctive relief might be authorized un-

der the Boys Markets case, which I dispute, such relief still

should be denied because the employer has failed to demon-

strate irreparable harm. See Detroit Newspaper Publishers

Association v. Detroit Typographical Union No. 18, 471

F.2d 872 (6th Cir. 1972), cert. denied, 411 U.S. 967 (1973).

Here the so-called strike or slow down was created by the

employer’s own conduct in suspending employees for viola-

tion of a work rule. There exists no parallel decision author-

izing injunctive relief under similar circumstances. In my

judgment, Anheuser-Busch is directly controlling. As Chief

Judge Coffin observed :

Although the district court’s findings on injury make

reference to the fact that the plant was effectively shut

down, an 1 cannot be permitted to qualify for

injunctive relief simply by responding to minor em-

loyee infractions in a way that brings serious and

irreparable damage upon himself by causing a shut-

down.

511 F.2d at 1099.

The company is willing to suspend enforcement of the work

rule pending arbitration; that is, it is willing to suspend

enforcement of the rule as long as the union adopts its

procedural interpretation of the contract. This in itself

should be sufficient to show a lack of irreparable harm.

Since the company can prevent the harm by its own conduct,

it is incredible to me that the harm is found to be irrepar-

able by the majority. Anheuser-Busch, Inc. v. Teamsters

Local No. 633,511 F. ad at 1099.

In any event, the company’s willingness to suspend the

work rule pending arbitration makes it clear that if this

court would order the parties to arbitrate the grievance in-

volved, injunctive relief as to the enforcement of the work

rule would not be necessary. [t seems to me that this is a

much better solution than authorizing a federal court to

exercise its jurisdiction in an area where it is both undesir-

able and unlawful.”

A true copy.

Attest:

CLERR, U.S. Court or ApRALS, Eicutx Circuit.

? As the Court indicated in Boys Markets:

Our holding in the present case is a narrow one. We do not

undermine the vitality of the Norris-LaGuardia Act. We deal

only with the situation in which a collective-bargaining con-

tract contains a mandatory grievance adjustment or arbitration

procedure. Nor does it follow from what we have said that

injunctive relief is appropriate as a matter of course in every

case of a strike over an arbitrable grievance.

398 U.S. at 253 (emphasis added).

APPENDIX B

U.S. DISTRICT COURT,

WESTERN DISTRICT OF ARKANSAS

NationaL Resecrors INDUSTRIES

Unrrep STEELWoRKERS OF AMER- 11-0018

ICA, ET AL.

April 16, 1977

Oren Harais, Senior District Judge :—This is an action

filed by plaintiff, National Rejectors Industries, division

of UMC Industries, Inc., pursuant to Section 301 of the

Labor-Management Relations Act, 29 U.S.C. § 185, seeking

injunctive relief, specific performance of an arbitration

agreement, and damages for alleged violations and breaches

of a labor-management agreement. Defendants are the Un-

ion and its local, the president and two other officers of the

local union, and the International representative of the par-

ent Union.

The matter was first presented in chambers on March 22,

1977 on application of plaintiff for a temporary restraining

erder. All parties appeared and agreed to voluntarily main-

tain the status quo pending a hearing to be held on March 30,

1977, on the application for a preliminary injunction.

Prior to the scheduled hearing date, the defendants filed

a motion to dismiss the complaint for lack of jurisdiction,

on the basis that unfair labor practice charges were pending

as to the same matters before the National Labor Relations

Board. The motion was supported by affidavit, to which

were attached documents relating to the charges and pro-

ceedings before the NLRB. Plaintiff responded to the mo-

tion.

The hearing was held, as scheduled on March 30, 1977.

All parties were present and represented by counsel. Argu-

ment as to the motion of defendants was first presented.

From the briefs and arguments of counsel, the pleadings

and the exhibits received as to the motion, the Court con-

cluded that jurisdiction exists in this Court as to this pro-

ceeding pursuant to Section 301 of the LMRA, 29 U.S.C.

§ 185, as interpreted by the Courts in Smith v. Evening

News Ass’n, 371 U.S. 195 (1962); William E. Arnold Co. v.

Carpenters, 417 U.S. 12 (1975), and Barunica v. United

Hatters, Cap & Millinery Workers, Local 55, 321 F.2d 764

(1963). An order will, therefore, be entered denying the mo-

tion of defendants that the complaint be dismissed for lack

of jurisdiction.

The Court proceeded to hear evidence from witnesses as

presented, received exhibits, and heard arguments of coun-

sel. From the pleadings, evidence, exhibits and argument,

the Court makes the following findings of fact and conclu-

sions of law, which are incorporated herein pursuant to

Rule 52, Federal Rules of Civil Procedure:

The Steelworkers Union and its local have been the col-

lective bargaining representative for the production and

maintenance employees at plaintiff’s Hot Springs, Arkan-

sas, plant since 1961. The current collective bargaining

agreement was introduced. It is dated January 8, 1975 and

provides that it shall continue in effect through January 15,

1978, and for one year periods thereafter, unless terminated

by notice after the 1978 date. In any event, the agreement

was in full force and effect at all times material to this liti-

gation.

Plaintiff is a subdivision of a Delaware corporation which

maintains an office and manufacturing plant in Hot Springs,

Arkansas where it is engaged in the manufacture and as-

sembly of coin and currency handling equipment. Plaintiff

employs some 400 persons at the plant, of whom some 300

are production and maintenance employees represented by

the Union.

It is stipulated and undisputed that plaintiff is an indus-

try affecting commerce within the meaning of Sections 2(7)

and 301 of the LMRA, 29 U.S.C. §§ 152(7) and 185 and that

the United Steelworkers of America, Lodge No. 6178, is a

labor organization within the meaning of Section 2(5) of

the LMRA, 29 U.S.C. § 152(5) which is engaged in repre-

senting or acting for employee members within the Western

District of Arkansas.

Defendants Frankie Joe Russell, Clois D. Lishbrook,

Margaret Sue Loudermill and Dewey D. Stiles are officers

or agents of the Union and are residents within the Western

District of Arkansas. The Union represents and acts for all

of the hourly- rated, non-supervisory production and main-

tenance employees at the plaintiff’s Hot Springs, Arkansas,

plant. Substantially all of the employees represented by the

Union are and have been members of the Union.

The Agreement of January 8, 1975, includes among its

terms and provisions Article XXXIV, No-Strike No-Lock-

out, which provides in relevant part that:

„Section 2. The Union agrees that there shall be no

strikes, slow-ups, stoppages of work, sit-down strikes,

refusals to handle merchandise, material or equipment

or other interference with the operations of the Com-

pany during the term of this Agreement.“

Article XV of the Agreement, Grievance Procedure, pro-

vides in relevant part that:

„Section 1. Should any difference arise between the

Company and the Union or its members employed by

the Company as to the meaning, 8 or viola-

tion of the terms and provisions of this Agreement,

there shall be no nsion or impeding of work on the

part of the Union or lockout on the part of the Company

on account of such differences—but an earnest effort

will be made to settle such differences. pursuant to

procedures set forth in the remainder of said Article.

Article XV sets forth a set of procedures under which

any grievances of employees within the bargaining unit are

made and processed through meetings between representa-

tives of the Union and the Company. Should these meetings

and discussions not he effective to resolve the differences of

the parties as to the matters in controversy, then the Article

provides that the dispute shall be referred to arbitration

proceedings, as provided for thereinafter.

At a meeting in December, 1976, an incident is alleged to

have occurred which led to the discharge of the president

of the local Union, Frankie Joe Russell, and the suspension

of two of the local’s officers, Clois D. Lishbrook and Mar-

garet Sue Loudermill, for 30 days. The Union filed griev-

ances as to the discharge of Russell and the suspensions of

the other two Union officers. Russell and the two suspended

officers were the designated representatives of the Union to

represent the Union at grievance hearings.

The Company requested that the Union negotiate at the

next higher level, over the grievance committee of which

Russell was a member, pursuant to their interpretation of

Section 4 of Article XV of the Agreement, requesting that

the conduct of Russell at the December meeting be investi-

gated. An investigation was conducted and report made. A

meeting was held, but the parties failed to resolve the issue.

The Company requested that further grievance proceedings

be conducted by the next highest Union official, which the

Union declined to do.

The Company refused to engage in grievance proceedings

with Mr. Russell as a Union representative and the Union

refused to appoint another representative to meet with the

Company, insisting that the Company bargain with Mr.

Russell. Further grievance was filed as to the failure of the

Company to abide by grievance procedures. Further griev-

ances were filed, but due to the impasse as to the participa-

tion of Mr. Russell in the proceedings, the grievances were

not processed as provided for in the Agreement.

In February, 1977, the Company determined that a series

of six new work rules were desirable. The Union was made

aware of the proposed rules, but again refused to meet and

bargain with the Company without Russell being present as

a representative.

The Company then placed the work rules in effect. Among

the rules were two rules which required employees to log

in’’ and log out’’ when leaving or returning to their as-

signed place of work. Clois D. Lishbrook, the senior local

officer of the Union, in the absence of Mr. Russell, informed

Company representatives that she did not intend to comply

with the new work rules; a grievance as to the adoption of

the work rules was filed, and she made statements from

which the inference might be drawn that the Union would

back those employees who chose not to comply with the new

rules.

Under procedures followed with reference to the enforce-

ment of the work rules, employees in violation would first

be warned verbally, upon a second failure to comply a writ-

ten warning would be delivered, a third failure to comply

resulted in further verbal warnings and a warning that the

employee would be suspended on the next violation. Subse-

quent failure to comply only then resulted in suspension of

the employee.

Within four working days after the new rules were placed

in effect 1388 employees had been suspended for violation

of the work rules. Production had dropped to 30% of nor-

mal. The Court finds that the members of the local Union

did thereby engage in concerted activity calculated to slow

up and impede production at the plant and that this activity

was initiated and encouraged by the defendant Union and

its officers and employees by reason of the differences then

existing between the Union and the Company having to do

with interpretation of the Collective Bargaining and opera-

tions and procedures thereunder. The Court concludes that

this is violative of the provisions of Articles XV and

XXXIV of the Agreement.

Company officials inet with Union representatives at

Washington, D.C., without resolving the differences. Com-

pany representatives then offered to proceed immediately

to arbitration on the grievance concerning Mr. Russell’s

discharge, which appears to be the reason that the other

differences and grievances have not been resolved in normal

grievance procedures. The Union refused.

By telegram dated March 18, 1977, the Company re-

quested that the intermediate grievance steps be waived and

that all grievances concerning the discharge and suspen-

sions arising in December, 1976, the implementation of the

work rules and the disciplinary actions taken pursuant

thereto, be submitted to arbitration immediately. The Union

responded that these matters were the subject of proceed-

ings before the NLRB.

The Court finds and concludes that the Company and the

Union have reached an obvious impasse in their relations

under the Collective Bargaining Agreement. It is evident

that the grievance procedures as provided for therein are

not effective under the existing circumstances to resolve

the differences between the parties. The Agreement sup-

plies the remedy, arbitration.

Some 217 grievances are shown to be pending and each

is found to be at least arguably arbitrable. None is specifi-

eally excluded from arbitration by the agreement.

Defendants contend that the grievances are not sub-

ject to arbitration by reason of the fact that the grievance

procedures specified in steps one, two and three of the

Agreement have not been accomplished. It is readily con-

cluded that the steps preceding arbitration have not been

accomplished by reason of the basic dispute between the

purties, whether Mr. Russell shall attend the meetings as

representative of the Union. In John Wiley & Sons v. Liv-

ingston, 376 U.S. 543 (1964), the Supreme Court, at page

555, et seq., made plain that:

„Once it is determined, as we have, that the parties

are obligated to submit the subject matter of a dispute

to arbitration, ‘procedural’ questions which grow out

of the dispute and bear on its final disposition should

be left to the arbitrator.

... we think it best accords with the usual purposes of

an arbitration clause and with the policy behind federal

labor law to regard procedural disagreements not as

— disputes but as aspects of the dispute which

led the grievance procedures into play.“

The objections of defendants based upon lack of pro-

cedural arbitrability’’ are not well taken. Both the subject

matter of the grievances and the differing interpretations

of the requirements of the Collective Bargaining Agree-

ment are, in the opinion of this Court, proper subjects of

arbitration.

It is undisputed that the disputes between the parties

have resulted in severe disruptions in production at the

Company’s Hot Springs plant. The record establishes that

continued interference with production will result in lower

output, delays in deliveries, and may result in failures to

meet existing contracts and may cause interference with

the securing of future contracts. The Court, therefore, finds

that the breaches of the ‘‘no-strike’’ provisions of the

Agreement, as hereinabove, set out, will cause irreparable

injury to the Company, if permitted to continue until the

disputes between the Company and the Union are finally

resolved.

Plaintiff would obviously suffer more from a denial of

the injunctive relief requested than would defendants from

its issuance. Any loss of contracts or sales due to slow ups,

sit downs or other concerted activity on the part of the

defendants calculated to coerce plaintiff to submit to de-

fendants on the disputes would be in clear violation of the

requirements of the Collective Bargaining Agreement and

could only result in loss not only to the Company, but to the

employees as well.

The Court coneludes from the evidence adduced at the

hearing that there is a substantial probability of success

on the merits of plaintiff’s complaint in this litigation.

The Court, therefore, finds that all the conditions and

requirements of Boys Markets, Inc. v. Retail Clerks, 398

U.S. 235 (1970), and Valmac Industries v. Food Handlers

Local 425, 519 F.2d 263 (1975), have been met, and that the

injunctive relief prayed for should be granted.

Such injunction will, however, be conditioned upon the

submission of the pending grievances to arbitration forth-

with. Procedures for selection of the arbitrator are provided

in the Agreement, and will be instituted within 20 days from

the issuance of the Order of this Court. Defendant Union

will, within the 20 day period, determine which of the out-

standing grievances it wishes to submit to arbitration and

furnish such list to Plaintiff, with a copy to be filed with

the Clerk of this Court. All grievances not so listed shall be

deemed abandoned.

An Order will be entered in accordance with this Mem

orandum Opinion.

Order

Pursuant to the findings of fact and conclusions of law

contained in the Memorandum Opinion filed herein on this

date,

It Is ConstpERED AND OrpeERED that the defendants, United

Steelworkers of America, AFL-CIO, and its Local No. 6178,

Frankie Joe Russell, Clois D. Lishbrook, Margaret Sue

Loudermill and Dewey D. Stiles, and their officers, privies,

agents, employees, servants, successors, assigns, members

and any other person or persons in active concert or par-

ticipation with them, and each of them, are hereby re-

strained and enjoined from engaging in, inducing, encour-

aging or in any way causing, assisting, aiding, advising or

in any way encouraging or assisting any strike, slow-up,

stoppage of work, sit-down strike, refusal to handle mer-

chandise, material or equipment, or other interference with

the operations of the Hot Springs, Arkansas plant of Na-

tional Rejectors Industries, Division of UMC Industries,

Inc., and specifically including but not limited to, refusals

to abide by the work rules existing at said plant.

Ir is FurtHer Orperep that plaintiff shall forthwith, and

within 20 days of the date of entry of this Order, request

that a panel of arbitrators be provided as set out in Article

XV of the Collective Bargaining Agreement and expressly

agree to arbitrate such grievances as shall be designated by

defendant Union. Defendant Union is ordered to determine

within 20 days of the date of entry of this Order which of

the now outstanding grievances it wishes to pursue to

arbitration, to submit such list to plaintiff and to file a copy

thereof with the Clerk of this Court within said 20 days. All

grievances not listed for submission to arbitration will be

, deemed abandoned.

Defendants’ motion filed herein, styled Motion to Dismiss,

is denied for the reasons stated in the Memorandum Opin-

ion of the Court filed herein this date.

APPENDIX O

SUPREME COURT OF THE UNITED STATES

No. A-445

UND STEELWORKERS OF AMERICA,

AFL-CIO, er A.,

Petitioners,

Nationa. Resectors IxpusrRIEs,

ETC.

Order Extending Time to File Petition for

Writ of Certiorari

Upon Consiprration of the application of counsel for

petitioner,

Ir Is Onperep that the time for filing a petition for writ

of certiorari in the above-entitled case be, and the same is

hereby, extended to and including December 28, 1977.

/s/ Harry A. BLackMuN

Associate Justice of the Supreme

Court of the United States

Dated this 21st

day of November, 1977.

This is a copy of a public record, reproduced as it was published. It is not legal advice, and it may not be the version a court would rely on. Check the official source before you cite it.