Respondents Brief — Charles D. Bonanno Linen Service, Inc. v. NLRB

Oe OS A CS Ae a on an Oe

No. 80-931. | JUL S&S 1981

In the

Supreme Court of the United States.

Ocroser TERM, 1980.

CHARLES D. BONANNO LINEN SERVICE, INC.,

PETITIONER,

v.

NATIONAL LABOR RELATIONS BOARD

AND

TEAMSTERS LOCAL UNION NO. 25,

INTERNATIONAL BROTHERHOOD OF

TEAMSTERS, CHAUFFEURS,

WAREHOUSEMEN AND HELPERS OF AMERICA,

RESPONDENTS.

ON WRIT OF CERTIORARI TO THE UNITED STATES

COURT OF APPEALS FOR THE FIRST CIRCUIT.

Brief for the Respondents, Teamsters Local Union No. 25,

International Brotherhood of Teamsters, Chauffeurs,

Warehousemen and Helpers of America.

James T. Grapy,

GasriEL O,. DuMOoNT, Jr.,

Grapy AND McDONALD,

ATTORNEYS AT LAw, P.C.,

75 Federal Street,

Boston, Massachusetts 02110.

(617) 426-9450

BOSTON , MASSACHUSETTS

BATEMAN & SLADE, INC.

fati . >

VWAHCE -Suorerme Court .

PY ' ’

Question Presented.

Did the First Circuit Court of Appeals properly conclude

that an impasse in collective bargaining negotiations alone

does not justify unilateral withdrawal by a single employer

from multiemployer bargaining?

Table of Contents.

Statement of the case 1

Summary of argument 3

Argument 4

I. The First Circuit Court of Appeals properly con-

cluded that an impasse in collective bargaining

negotiations alone does not justify unilateral with-

drawal by a single employer from multiemployer

bargaining 4

A. The decision of the National Labor Relations

Board, as enforced by the First Circuit Court of

Appeals, will effectuate the continued viability

of multiemployer bargaining 10

B. The First Circuit Court of Appeals gave appro-

priate deference to the policy judgment made

by the National Labor Relations Board 13

II. The decision of the Third Circuit Court of Ap-

peals is neither persuasive nor consonant with the

standard of review articulated by this Court 21

Conclusion 28

Table of Authorities Cited.

CasEs.

American Ship Building Co. v. NLRB, 380 U.S. 300

(1965) 13, 20, 26

Associated Shower Door Co., Inc., 205 NLRB 677

(1973) 22, 23

Atlas Electrical Service Co., 176 NLRB 827 (1969) 9

Beck Engraving Co. , 213 NLRB 53 (1974) 25

ii TABLE OF AUTHORITIES CITED.

Brown Food Store, 137 NLRB 73 (1962) 16

Buffalo Linen Supply Co., 109 NLRB 447 (1957) 14

Carvel Co. v. NLRB, 560 F.2d 1030 (1st Cir. 1977),

cert, denied, 434 U.S. 1065 (1978) 8

Connell Typesetting Co., 212 NLRB 918 (1974) 9, 23, 24, 27

Detroit Newspaper Publishers Assoc. v. NLRB, 372

F.2d 569 (6th Cir. 1967) 6n, 23

Fairmont Foods Co. v. NLRB, 471 F.2d 1170 (8th Cir.

1972) 21, 23

H &D, Inc. v. NLRB, 633 F.2d 139 (9th Cir. 1980) 22n

Hi-Way Billboards, Inc., 206 NLRB, 22 (1973), sup-

plementing 191 NLRB 244, enforcement denied, 500

F.2d 181 (5th Cir. 1974) 18

McAx Sign Co. v. NLRB, 576 F.2d 62 (5th Cir. 1978),

cert. denied, 439 U.S. 1116 (1979) 9

Memorial Consultants, Inc., 153 NLRB 1 (1965) ll

Midwest Casting Corp., 194 NLRB 523 (1971) ll

NLRB v. American Insurance Co., 343 U.S. 395 (1952) ll

NLRB v. Associated Shower Door Co., 512 F.2d 230

(9th Cir.), cert. denied, 423 U.S. 893 (1975) 21, 22, 24

NLRB v. Babcock & Wilcox Co., 351 U.S. 105 (1956) 13, 16

NLRB v. Beck Engraving Co., 522 F.2d 475 (3d Cir.

1975) 3, 4, 17, 20, 21 et seq.

NLRB v. Brotherhood of Teamsters, Local No. 70,

470 F.2d 509 (9th Cir. 1972), cert. denied, 414 U.S.

821 (1973) 9

NLBB v. Brown, 380 U.S. 278 (1965) 5, 13, 16, 20, 26 et seq.

NLRB v. Dover Tavern Owners Assoc., 412 F.2d 725

(3d Cir. 1969) 9

TABLE OF AUTHORITIES CITED. iii

NLRB v. Hi-Way Billboards, Inc., 473 F.2d 649 (5th

Cir. 1973) 21, 23, 24

NLBB v. Independent Association of Steel Fabricators,

Inc., 582 F.2d 135 (2d Cir. 1978), cert. denied, 439

U.S. 1130 (1979) 21, 22, 24

NLRB v. Insurance Agents’ International Union, 361

U.S. 477 (1960) 20, 26

NLRB v. Katz, 369 U.S. 736 (1962) 27

NLRB v. Mackay Radio & Telegraph Co., 304 U.S.

333 (1938) 5, 26

NLRB v. Marine Machine Works, Inc., 635 F.2d 522

(5th Cir. 1981) 21

NLRB v. Paskesz, 405 F.2d 1201 (2d Cir. 1969) 9

NLRB v. Sklar, 316 F.2d 145 (6th Cir. 1963) 9

NLRB v. Tex-Tan, Inc., 318 F.2d 472 (5th Cir. 1963) 10

NLRB v. Truck Drivers Local 449, 353 U.S. 87 (1957)

5, 6, 12, 13, 14 et seq.

NLRB v. Tulsa Sheet Metal Works, Inc., 367 F.2d 55

(10th Cir. 1966) 9

Pacific Coast Association of Pulp and Paper Manufac-

turers, 163 N.L.R.B. 892 (1967) 23

Phelps Dodge Corp. v. NLRB, 313 U.S. 177 (1941) 13

Republic Aviation Corp. v. NLRB, 324 U.S. 793 (1945) 13

Retail Associates, Inc., 120 NLRB 388 (1958) 8,9

Spun-Jee Corp., 171 NLRB 557 (1968) 9, 27

Taft Broadcasting Co., 163 NLRB 475 (1967), enforced

395 F.2d 622 (D.C. Cir. 1968) 12

Television Artists, Kansas City Local v. NLRB, 395

F.2d 622 (D.C. Cir. 1968) ll

iv TABLE OF AUTHORITIES CITED,

The Evening News Association, 154 N.L.R.B. 1494

(1965), enforced sub. nom. Detroit Newspaper Pub-

lishers Association v. NLRB, 372 F.2d 569 (6th Cir.

1967) 23

Tobey Fine Papers v. NLRB, F.2d ,107LRRM

2221 (8th Cir. 1981) 21

Truck Drivers Local 449 v. NLRB, 231 F.2d 110 (2d

Cir. 1956) 14

U.S. Lingerie Corp., 170 NLRB 750 (1968) 9

STATUTES.

29 U.S.C. §§ 158 et seq. (National Labor Relations

Act) 1, 2, 11, 13, 14 et seq.

§ 158(a)(1) 1,16

§ 158(a) (3) 14, 16

§ 158(a) (5) l

§ 160(e) 2

§ 160(f) 2

LEGISLATIVE MATERIALS.

93 Cong. Rec, 4030 (1947) 6

MISCELLANEOUS,

Comment, 17 B.C. Indus. & Comm. L. Rev. 525

(1976) ln, 21n, 26n

Comment, 66 Harv. L. Rev. 886 (1953) 5n

Herold, Multiemployer Bargaining And The Whipsaw

Strike: The Use Of A Lockout As An Economic

Weapon, 21 Brooklyn Bar, 54 (1969) 5n

TABLE OF AUTHORITIES CITED. v

Murphy, Impasse And The Duty To Bargain In Good

Faith, 39 U, Pitt. L. Rev. 1 (1977) 7n, Lln, 26n

Pierson, Multi-Employer Bargaining: Nature and

Scope, 8 (1949) 4n

Statement of the Case.

The instant matter grows out of a charge filed with the Na-

tional Labor Relations Board (hereinafter, “the Board”) by

Teamsters Local Union No, 25, International Brotherhood of

Teamsters, Chauffeurs, Warehousemen and Helpers of Amer-

ica (hereinafter, “Local 25”). In that charge, Local 25 assert-

ed that Charles D. Bonanno Linen Service, Inc. (hereinafter

“Bonanno”), was engaged in unfair labor practices as defined

by Sections 8(a)(5) and (1) of the Act, 29 U.S.C. § 158 (a) (5)

and (1) by its refusal to execute the collective bargaining

agreement negotiated by Local 25 and the New England

Linen Supply Association (hereinafter, “the Association”), a

group of ten employers including Bonanno (J.A. 92-93;

P. 19-20).*

For some years, Local 25 negotiated collective bargaining

agreements with the Association including the agreement that

covered the period from September 21, 1972 through April 18,

1975. Throughout these years, Bonanno was a member of the

Association for purposes of bargaining with Local 25 (id.). On

or about February 19, 1975, Bonanno authorized the Associ-

ation to bargain collectively on its behalf with Local 25 re-

garding an agreement to replace the agreement which was to

expire on April 18, 1975 (see J.A. 93; P. 20). Negotiations for

a successor agreement began in March of 1975, but by May 15,

1975, the parties reached an impasse on the issue of whether

the salaries would be computed on a commission or an hourly

basis (J.A. 94; P. 20).

On June 23, 1975, after repeated attempts to break the im-

passe, Local 25 instituted a selective strike against Bonanno

which resulted soon after in the remaining Association em-

* References marked “J.A.” refer to the portions of the record contained in

the Joint Appendix while those marked “P.” refer to the decisions which are

reprinted in the Petition for a Writ of Certiorari,

ployers locking out their union drivers (id.). Negotiations con-

tinued subsequent to the strike and lockout, and between June

23, 1975 and November 21, 1975, Bonanno, while under the

protective umbrella of the lockout, hired permanent replace-

ments for its striking employees (J.A. 94-95; P. 20).

On November 21, 1975, Bonanno, apparently diss»tisfied

with the strategy proposed by the Association for breaking the

impasse (see J.A. 38-39, 76-77), notified the Association and

Local 25 that it was withdrawing from the Association (P. 20).

Local 25 continued to meet with the Association without Bon-

anno (J.A. 95; P. 21); however, on April 9, 1976, Local 25

filed the unfair labor practice charges out of which the instant

controversy has grown. An agreement between Local 25 and

the Association was reached on April i3, 1976, based on the

union's acceptance of the Association's revised hourly wage of-

fer; and subsequent thereto, Local 25 informed Bonanno by

letter dated April 29, 1976, that the union at no time had con-

sented to Bonanno’s withdrawal and, therefore, Local 25 con-

sidered Bonanno to be a member of the Association and bound

by the agreement reached (J.A. 95-96; P. 21).

The instant case originally came before the First Circuit

Court of Appeals pursuant to an application of Bonanno under

Section 10(f) of the National Labor Relations Act (hereinafter,

“the Act”), 29 U.S.C. § 160(f), for review of the initial deci-

sion and order of the Board, 229 NLRB 629 (1977) (P. 53-71).

Subsequent to the docketing of said application, the Board,

sua sponte, decided to review and to reconsider the issues

raised in this case and was granted leave by the First Circuit to

withdraw the certified list. On August 6, 1979, the Board

issued its Supplemental Decision and Order, 243 NLRB No.

140, and, thereafter, applied under Section 10(e) of the Act

with the First Circuit for enforcement of that Decision and

Order.

3

Summary of Argument.

Multiemployer bargaining, in certain contexts, is beneficial

to both companies and unions and, more importantly, has

been recognized by Congress as an effective means of achiev-

ing labor peace. However, since it is based, to a certain ex-

tent, on sacrifice and compromise, it is a fragile concept that

will be abandoned by both sides if the benefits of same cannot

be ensured through the severe restriction of nonconsensual

withdrawals.

An impasse is an expected, commonplace and temporary

part of collective bargaining negotiations. As such, linking

nonconsensual withdrawal rights to the existence of an im-

passe would result in the Board’s “unusual circumstances” ex-

ception to nonconsensual withdrawal subsuming the rule of

nonconsensual withdrawal. Moreover, an impasse can be

manipulated with the result that allowing withdrawal at im-

passe would sanction unfettered withdrawal rights, even

though such rights clearly are antithetical to multiemployer

bargaining.

In application, this Court’s judicial review standards in

cases involving multiemployer bargaining issues require that a

reviewing court first determine the propriety of the legal

foundation upon which the decision of the Board is based,

and, thereafter, give the appropriate deference to the judg-

ment of the Board unless that foundation is found to be er-

roneous.

As applied to the facts of the instant case, the Board was

balancing (1) the preservation of the viability of multiem-

ployer bargaining, since it perceived correctly that such bar-

gaining, as a practical matter, would be destroyed if members

of the unit were free to withdraw upon a bargaining impasse,

and (2) what was viewed by the Third Circuit in NLRB v.

Beck Engraving Co., 522 F.2d 475 (3d Cir. 1975), as an im-

4

balance of economic weapons. The Board, of course, struck

the balance in favor of preserving the integrity of multi-

employer bargaining, especially since this Court has ad-

monished both the Board and the courts to refrain from be-

coming arbiters of the economic weapons which parties may

use in seeking to gain acceptance of their bargaining demands.

In any case, it is evident that the balance struck by the Board

was based on a sound legal foundation and, as such, was en-

titled to deference.

Finally, as presently articulated, only the decision of the

Third Circuit in Beck is inconsistent with that of the First Cir-

cuit below. However, the Beck decision is suspect as the court

(1) makes itself an arbiter of economic weapons, (2) engages in

a balancing of so-called “economic weapons” which is ex-

tremely imprecise, and (3) misperceives a bargaining impasse

as an event which neither side can manipulate. Moreover, the

Third Circuit in Beck has usurped impermissibly the Board’s

function of balancing conflicting interests.

Accordingly, while the decision of the First Circuit below is

analytically sound, its counterpart in the Third Circuit is

neither persuasive nor consonant with the appropriate stand-

ard of review.

Argument.

I. Tue First Cincurr Court or APPEALS PROPERLY CONCLUDED

THAT AN IMPASSE IN COLLECTIVE BARGAINING NEGOTIATIONS

ALONE Does Nor Justiry UNILATERAL WITHDRAWAL BY A

SINGLE EMPLOYER FROM MULTIEMPLOYER BARGAINING.

Multiemployer bargaining has existed at least since the early

1800’s when it was prominent in the anthracite coal industry. !

'Pierson, Multi-Employer Bargaining: Nature and Scope, 8 (1949).

5

This type of bargaining increases the economic leverage of

small businessmen and permits them to conserve scarce econo-

mic resources.2 Moreover, as this Court has pointed out,

multiemployer bargaining enables smaller employers to bar-

gain “on an equal basis with a large union” and to avoid “the

competitive disadvantages resulting from nonuniform contrac-

tual terms.” NLRB v. Truck Drivers Local 449, 353 U.S. 87,

96 (1957).* In addition, multiemployer bargaining is an effec-

tive means of counteracting the potential use by unions of

whipsaw tactics.

Thus, without multiemployer bargaining, a union which

represents the employees of a number of competing employers

in a particular geographic region could strike a single

employer while permitting that employer’s competitors to con-

tinue to operate. However, in a multiemployer bargaining

setting, the potential use of whipsaw tactics by the union is

thwarted, since the nonstruck members of the bargaining

association can lock out their employees, see NLRB v. Truck

Drivers Local 449, 353 U.S. at 97, and all members of the

association can hire temporary replacements for their struck or

locked-out employees. See NLRB v. Mackay Radio & Tele-

graph Co., 304 U.S. 333, 345 (1938); NLRB v. Brown, 380

U.S. 278, 283 (1965).

Conversely, multiemployer bargaining permits a union to

conserve its own scarce resources as well as effectuates a stand-

ardization of wages, benefits and working conditions within

an industry. Moreover, multiemployer bargaining facilitates

*Herold, Multiemployer Bargaining And The Whipsaw Strike: The Use

Of A Lockout As An Economic Weapon, 21 Brooklyn Bar. 54, 54-55 (1969).

3 As one commentator has noted, multiemployer bargaining has become a

defensive technique for small businessmen against the demands of strengthened

unions. Comment, 66 Harv. L. Rev. 886, 886-887 (1953).

‘Herold, Multiemployer Bargaining And The Whipsaw Strike: The Use

Of A Lockout As An Economic Weapon, 21 Brooklyn Bar. 54, 54-55 (1969);

Comment, 66 Harv. L. Rev. 886, 887 (1953).

6

the adoption of industry-wide benefits such as jointly-

managed pension and welfare plans (see P. 21). Accordingly,

multiemployer bargaining, in certain contexts, clearly is

favored by both labor and management.

More importantly, multiemployer bargaining, as noted by

this Court, see NLRB v. Truck Drivers Local 449, 353 U.S. at

95, has been recognized by Congress as “a vital factor in the ef-

fectuation of the national policy of promoting labor peace

through strengthened collective bargaining.” Thus, during

the Taft-Hartley amendments debate, Congress extolled the

virtues of multiemployer bargaining, stating at one point the

following:

Because numerous employers are covered by a single col-

lective bargaining agreement, less time is lost in the

bargaining process. Settlements are made simultan-

eously for these employers rather than on an individual

employer-by-employer basis. Industrial peace is

achieved in one step rather than over a prolonged period

of time. Bargaining with hundreds of individual firms

for the same things is both wasteful and unfair to both

sides.

93 Cong. Rec. 4030-4031 (1947) (remarks of Senator Murray).

However, the continued vitality of multiemployer bargain-

ing rests on the willingness of the Board and the courts to

restrict severely the rights of parties to withdraw from such

bargaining once undertaken.» “From the standpoint of a

5As the Sixth Circuit stated in Detroit Newspaper Publishers Assoc. v.

NLRB, 372 F.2d 569, 572 (6th Cir. 1967):

Thus, while fear of being “locked in” a unit might discourage en-

trance by a union as the Board has argued, it must be equally clear

7

participating employer, it is crucial that the multiemployer

group be held together. Otherwise, the goal of multiemployer

bargaining will be defeated.”® Similarly, it is critical to the

union that the multiemployer group be maintained, since it

has sacrificed certain economic leverage to obtain standard-

ized benefits.

In this regard, a union, absent multiemployer bargaining,

can exert crippling leverage on a single employer by striking

that employer while permitting his competitors to continue to

operate. The union, however, relinquishes this leverage when

it consents to multiemployer bargaining, since the association

members, by employing such techniques as the lockout, may

operate as a group to ensure that none of its members are

placed in a competitive disadvantage if the union engages in

selective strikes. In turn, a businessman gives up certain ele-

ments of his economic independence to obtain protection from

potential whipsaw tactics by the union and to ensure ultimate

competitive wage and benefit parity. Accordingly, since

multiemployer bargaining is based, to a certain extent, on

sacrifice and compromise, it is a fragile concept that will be

abandoned by both sides if the benefits of same cannot be en-

sured.

For example, a union, in the context of multiemployer bar-

gaining, engages in a selective strike against one member of

the association after a bargaining impasse has been reached.

The other association members, as businessmen, most likely

would choose to continue to operate with their normal work-

that a virtually unfettered right of withdrawal, even if available to

both sides in parity, might also destroy the attractiveness of such ar-

rangements. The Board might well find that the instability resulting

from such conditions has undermined the multi-employer unit as an ef-

fective tool of labor relations.

®*Murphy, Impasse And The Duty To Bargain In Good Faith, 39 U. Pitt.

L. Rev. 1, 50 (1977).

8

force. However, the other association members nevertheless

choose to lock out their union employees to ensure the integrity

of the multiemployer unit by protecting the competitive posi-

tion of the struck member. The result is that the union’s po-

tential economic leverage is minimized or eliminated. Subse-

quently, the struck member of the bargaining association,

while under the protective umbrella of the association-wide

lockout, hires permanent replacements for its striking union

members and then withdraws from the association with the

obvious belief that it can arrive at either a more favorable deal

or no deal at all with the union, and with the knowledge that

it no longer needs the protections which the association afford-

ed it during the selective strike.

Unquestionably, the above scenario is antithetical to the

continued viability of multiemployer bargaining. Thus,

despite assuming economic loss to protect a struck member,

the nonstruck members of the association have lost bargaining

leverage and the prospect of competitive wage and benefit

parity within their geographical area. In turn, the union has

lost the fundamental bargaining leverage of a strike without

obtaining the benefit of standardized wages and benefits.

Surely, in light of the above, the parties must be reluctant to

engage again in multiemployer bargaining.

Recognizing the inherently fragile nature of multiemployer

bargaining and the devastating effect an employer’s noncon-

sensual withdrawal can have on same, the Board in Retail

Associates, Inc., 120 NLRB 388 (1958), established restrictive

guidelines for withdrawal from a multiemployer bargaining

unit. Pursuant to those guidelines, withdrawal by an indivi-

dual employer or union with respect to one or more employers

is allowed prior to the start of negotiations only if adequate

written notice is given. Once negotiations begin, a party may

withdraw only in cases of mutual consent or “unusual circum-

stances.” The Board’s use, in general, of restrictive withdraw-

al guidelines has enjoyed wide acceptance among the review-

ing courts. See, e.g., Carvel Co. v. NLRB, 560 F.2d 1030

9

(ist Cir. 1977), cert. denied, 434 U.S. 1065 (1978); NLRB v.

Paskesz, 405 F.2d 1201 (2d Cir. 1969); NLRB v. Dover Tavern

Owners Assoc. , 412 F.2d 725 (3d Cir. 1969); McAx Sign Co. v.

NLRB, 576 F.2d 62 (5th Cir. 1978), cert. denied, 439 U.S. 1116

(1979); NLRB v. Sklar, 316 F.2d 145 (6th Cir. 1963); NLRB v.

Brotherhood of Teamsters, Local No. 70, 470 F.2d 509 (9th Cir.

1972), cert. denied, 414 U.S. 821 (1973); NLRB v. Tulsa Sheet

Metal Works, Inc., 367 F.2d 55 (10th Cir. 1966).

In applying the “unusual circumstances” exception to the

withdrawal prohibition, the Board consistently has permitted

nonconsensual withdrawal only when an employer member is

experiencing severe economic distress — see, e.g., Atlas Elec-

trical Service Co., 176 NLRB 827 (1969); Spun-Jee Corp., 171

NLRB 557 (1968); U.S. Lingerie Corp., 170 NLRB 750 (1968)

— or when consensual employer withdrawals have frag-

mented the multiemployer unit. See, e.g., Connell Typeset-

ting Co., 212 NLRB 918 (1974).

In the instant case, Bonanno attempted to validate its with-

drawal from the Association based on the existence of a

bargaining impasse. The Board, however, determined that a

bargaining impasse, standing alone, is not an “unusual cir-

cumstance” within the meaning of Retail Associates, Inc.,

and, thus, not an appropriate basis for violating the integrity

of ‘the multiemployer unit. This Court is asked herein to

determine whether the Board’s judgment and decision on the

impasse question should be supported.

As such, the instant case implicates two fundamental policy

issues. The first issue is whether the decision of the Board, as

enforced by the First Circuit Court of Appeals, will effectuate

the continued viability of multiemployer bargaining. The sec-

ond issue is whether the Board’s judgment in areas of national

labor policy and, particularly, in matters relating to multi-

employer bargaining, is entitled to meaningful deference, or

whether reviewing courts simply may substitute their judg-

ment for that of the Board under the guise of exercising the

limited judicial review permitted by this Court.

10

A. The Decision of the National Labor Relations Board,

as Enforced by the First Circuit Court of Appeals, will

Effectuate the Continued Viability of Multiemployer

Bargaining.

At the outset, it is important to note that the facts of the in-

stant case raise only the question of whether nonconsensual

withdrawal rights accrue upon the reaching of an impasse in

the context of multiemployer bargaining, and not the broader

question of whether a party may withdraw from multiemploy-

er bargaining given the existence of both a bargaining impasse

and the negotiation of interim agreements. Thus, while the

Board (see P. 42-51) and the First Circuit, see 630 F.2d 25,

30-33 (P. 26-33), discuss an employer’s withdrawal rights if in-

terim agreements have been negotiated after a bargaining im-

passe has been reached, both the Board’ and the First Circuit®

found that in the instant case no interim agreements were

made or even attempted. Accordingly, for purposes of deter-

mining whether the decision of the Board will effectuate the

continued viability of multiemployer bargaining, this Court

need only address so much of that decision which deals solely

with the impact of a bargaining impasse.

An “impasse” has been defined in various ways. For ex-

ample, as pointed out by the First Circuit below, see 630 F.2d

at 34 n.24 (P. 35 n.24), an “impasse” is often defined as “a

state of facts in which the parties, despite the best of faith, are

simply deadlocked.” NLRB v. Tex-Tan, Inc., 318 F.2d 472,

482 (5th Cir. 1963). Similarly, an “impasse” has been defined

as a situation in which “there was no realistic possibility that

continuation of discussion at that time would have been fruit-

7The Board found that “[i]n the instant case no interim agreements were

made or even attempted” (P. 51).

6 The First Circuit ruled that the negotiation of individual agreements “is

absent in the present case; as the Board stated, ‘no interim agreements were

made or even attempted.”” 630 F.2d at 33 (P. 33); see also Circuit Judge

Campbell’s concurrence at 630 F.2d at 35 (P. 37).

11

ful.” Television Artists, Kansas City Local v. NLRB, 395 F.2d

622, 628 (D.C. Cir. 1968).

However defined, it is evident that an impasse must be

viewed as an expected part of negotiations especially in times

of slow economic growth. Moreover, it is clear that the

statutory duty to bargain in good faith does not require a party

“to engage in fruitless marathon discussions at the expense of

frank statements and support of his position.” NLRB v.

American Insurance Co., 343 U.S. 395, 404 (1952). As a

result, an impasse is not only an expected part of the negotia-

tion process, but also often is arrived at early in that process.

See, e.g., Memorial Consultants, Inc., 153 NLRB 1, 15 (1965)

(impasse reached at second meeting of the parties); Midwest

Casting Corp., 194 NLRB 523, 524-532 (1971) (impasse

reached after one month and five meetings). Furthermore, as

one commentator has stated, an impasse is “a fragile condition

which may easily expire.”®

Accordingly, linking a party’s withdrawal rights to a com-

mon and temporary stage in normal collective bargaining

would result in the “unusual circumstances” exception to the

nonwithdrawal rule subsuming that rule and would make

nonconsensual withdrawals from multiemployer bargaining

commonplace. Since, as noted supra, the stability of multi-

employer bargaining rests, in large part, on maintaining the

integrity of the multiemployer group, the Board’s refusal to

permit nonconsensual withdrawal at impasse can only be

viewed as effectuating the Congressional policy of continuing

the viability of multiemployer bargaining.

In addition, a bargaining impasse not only is commonplace,

but also clearly may be manipulated and created by an em-

ployer or union simply by the party’s remaining steadfast in a

position which is known to be unacceptable to the other

party.’° As stated by the First Circuit below, since “the Act

®Murphy, Impasse And The Duty To Bargain In Good Faith, 39 U. Pitt.

L. Rev. 1, 17 (1977).

'©See Comment, 17 B.C. Indus. & Comm. L. Rev. 525, 539-540 (1976).

12

expressly provides that the ‘obligation [to bargain collectively]

does not compel either party to agree to a proposal or require

the making of a concession[,]’” it is “within the power of an

employer or union in many cases to cause a stalemate, as by

adhering to a position known to be unacceptable to the other

side.” 630 F.2d at 34 (P. 35; citation omitted.) Thus, the

practical effect of allowing withdrawal at impasse would be to

sanction unfettered withdrawal rights — a policy which long

ago was rejected by the Board as antithetical to the national

policy of promoting multiemployer bargaining.

Finally, since the existence of an impasse depends on such

varying factors as “[t]he bargaining history, the good faith of

the parties in negotiations, the length of the negotiations, the

importance of the issue or issues as to which there is disagree-

ment, [and] the contemporaneous understanding of the par-

ties as to the state of negotiations,” Taft Broadcasting Co., 163

NLRB 475, 478 (1967), enforced, 395 F.2d 622 (D.C. Cir.

1968), the determination of same is imprecise and time-

consuming. As such, tying the right of withdrawal to impasse

“can only lead to confusion concerning the rights of the par-

ties,” 630 F.2d at 34-35 (P. 35), and a concomitant reluctance

by both businessmen and unions to engage in multiemployer

bargaining.

In sum, maintenance of the integrity of multiemployer bar-

gaining can only be achieved by severely restricting the non-

consensual withdrawal rights of the parties thereto. Permit-

ting nonconsensual withdrawal at impasse would remove, in

large part, any practical restrictions on a party’s right to

withdraw from multiemployer bargaining. Accordingly,

since multiemployer bargaining has been recognized by Con-

gress as “a vital factor in the effectuation of the national policy

of promoting labor peace through strengthened collective bar-

gaining,” NLRB v. Truck Drivers Local 449, 353 U.S. at 95,

the Board’s decision herein is consonant with Congressional

policy and should be enforced.

13

B. The First Circuit Court of Appeals Gave Appropriate

Deference to the Policy Judgment Made by the National

Labor Relations Board.

This Court historically has recognized that the rights and

responsibilities of employees, employers, and unions under the

Act often must be determined through the process of balancing

“conflicting legitimate interests.” NLRB v. Truck Drivers

Local 449, 353 U.S. at 96, In addition, this Court has stated

that the “function of striking that balance to effectuate na-

tional labor policy is often a difficult and delicate responsibili-

ty, which the Congress committed primarily to the National

Labor Relations Board subject to limited judicial review.” Id.,

citing NLRB v. Babcock & Wilcox Co., 351 U.S. 105 (1956);

Republic Aviation Corp. v. NLRB, 324 U.S. 793 (1945);

Phelps Dodge Corp. v. NLRB, 313 U.S. 177 (1941).

This principle of judicial deference has been extended

specifically by this Court to problems or questions arising in

the context of multiemployer bargaining. Thus, this Court in

NLRB vy. Truck Drivers Local 449, 353 U.S. at 96, stated the

following:

. . . the compelling conclusion is that Congress intended

“that the Board should continue its practice of certifying

multi-employer units, and intended to leave to the Board's

specialized judgment the inevitable questions concerning

multi-employer bargaining bound to arise in the future.”

(Citations omitted.) ‘

This Court, however, has emphasized that a Board decision

should be reviewed and set aside if the Board has usurped

“major policy decisions properly made by Congress,” NLRB v.

Brown, 380 U.S. at 292, quoting American Ship Building

Co. v. NLRB, 380 U.S. 300, 318 (1965), with the result that its

decision rests on an “erroneous legal foundation.” NLRB v.

Brown, 380 U.S. at 292, quoting NLRB v. Babcock & Wilcox,

supra. Accordingly, the application conceptually of this

14

Court's judicial review standards in cases involving multi-

employer bargaining issues requires that a reviewing court

first determine the propriety of the legal foundation upon

which the decision of the Board rests, and, thereafter, give the

appropriate deference to the judgment of the Board unless that

foundation is found to be erroneous, since Congress has en-

trusted to the Board the primary responsibility for balancing

the legitimate conflicting interests which arise in the context of

labor-management relations. The functional application of

these judicial review standards is illustrated clearly by NLRB

v. Truck Drivers Local 449 and NLRB v. Brown.

In Buffalo Linen Supply Co., 109 NLRB 447 (1957), the

union alleged that the lockout of the union employees by the

nonstruck members of a multiemployer bargaining association

was in retaliation for the exercise by two employees of their

protected right to strike and, therefore, violative of Section

8(a)(3) of the Act. The Board, however, ruled that the

union's strike of one association member was an attempt “to

atomize the employer solidarity which is the fundamental aim

of the multi-employer bargaining relationship,” id. at 448,

and concluded that the lockout was a permissible method of

defending the integrity of the multiemployer bargaining rela-

tionship, despite its arguably adverse impact on the employees’

protected right to strike. See id. at 448-449.

On review, the Second Circuit Court of Appeals concluded

that the Board, in premising its decision on a desire to main-

tain the integrity of multiemployer bargaining, had usurped

the power of Congress, since Congress had not expressed a

clear opinion on multiemployer bargaining. See Truck Driv-

ers Local 449 v. NLRB, 231 F.2d 110, 117-118 (2d Cir, 1956),

Accordingly, the Second Circuit rejected the legal foundation

of the Board's decision and, thus, found no basis for the Board

to engage in a balancing of interests. See id. at 118.

In NLRB v. Truck Drivers Local 449, supra, this Court

disagreed with the Second Circuit's conclusion that the preser-

vation of the integrity of multiemployer bargaining was not an

15

appropriate legal foundation for the Board's decision, Rather,

the Court found ample support in the legislative history of the

Taft-Hartley amendments for the policy of promoting stability

in multiemployer bargaining. In this regard, this Court stated

the following:

At the time of the debates on the Taft-Hartley amend-

ments, proposals were made to limit or outlaw multi-

employer bargaining. These proposals failed of enact-

ment. They were met with a storm of protest that their

adoption would tend to weaken and not strengthen the

process of collective bargaining and would conflict with

the national labor policy of promoting industrial peace

through effective collective bargaining.

The debates over the proposals demonstrate that Con-

gress refused to interfere with such bargaining because

there was cogent evidence that in many industries the

multi-employer bargaining basis was a vital factor in the

effectuation of the national policy of promoting labor

peace through strengthened collective bargaining. The

inaction of Congress with respect to multi-employer bar-

gaining cannot be said to indicate an intention to leave

the resolution of this problem to future legislation.

353 U.S. at 95-96 (citations omitted).

Having concluded that the Board properly could balance

the employees’ right to strike against the preservation of the in-

tegrity of multiemployer bargaining, the Court then noted

that Congress had left to the Board the primary responsibility

for striking that balance and, therefore, adopted the balance

struck by the Board. See id. at 96-97.

Thus, in reviewing the Board's decision in NLRB v. Truck

Drivers Local 449, this Court examined the policy interests be-

ing balanced by the Board, and, having determined that those

interests were valid, left to the Board the primary responsi-

bility for striking the balance.

16

As noted supra, NLRB v. Brown also is illustrative of the

functional application of the judicial review standards in cases

involving multiemployer bargaining. In that case, the non-

struck members of a bargaining association were charged with

violating Sections 8(a)(1) and (3) of the Act stemming from the

lockout of their union employees and the hiring of temporary

replacements. See Brown Food Store, 137 NLRB 73, 74

(1962). The Board found that the lockout did not serve to pre-

serve the bargaining unit and concluded that the statutorily

required antiunion motivation could be inferred from the ac-

tions taken by the nonstruck members and, thus, no evidence

of a subjective intent to discriminate was necessary. See id. at

75. Accordingly, the Board, on balance, determined that the

employees’ right to be free from discriminatory conduct out-

weighed any incidental benefit which the lockout and hiring

of temporary replacements might have had on furthering the

stability of multiemployer bargaining. See id. at 75-77.

On review, this Court agreed with the appraisal of the

Tenth Circuit Court of Appeals that the Board improperly

concluded that the nonstruck association members’ lockout of

their union employees and the hiring of temporary replace-

ments “carried its own indicia of unlawful intent.” NLRB v.

Brown, 380 U.S. at 282. As such, this Court ruled that the

Board's decision had been based on “an erroneous legal foun-

dation” and that, therefore, the balance struck by the Board

could not be upheld. Jd. at 292, quoting NLRB v. Babcock &

Wilcox, supra.

In sum, in reviewing Board determinations involving issues

arising in the context of multiemployer bargaining, this Court

requires that the competing interests which are being balanced

by the Board have a proper legal foundation; however, if it

determines that such a foundation exists, this Court ensures

that it is the Board and not the reviewing court of appeals

which exercises the primary responsibility for striking the

balance between those interests.

17

In the instant case, the Board, in effect, has balanced two

different sets of “conflicting interests.” First, the Board has

balanced the preservation of the integrity of multiemployer

bargaining against the “right” of an employer to unilaterally

withdraw at impasse given that the Board has granted its

imprimatur to the union’s negotiation of interim agreements.

This latter “right” had its origin in NLRB v. Beck Engraving

Co., 522 F.2d 475 (3d Cir. 1975), where the Third Circuit

Court of Appeals perceived that the Board’s policies had pro-

vided unions with two economic weapons, i.e., the selective

strike and individual negotiations, while affording employers

only the right of lockout.'!! The Third Circuit, accordingly,

believed that employers must be accorded a second economic

weapon, viz., the right to withdraw from bargaining, and

that this second weapon must “accrue simultaneously based

upon the occurrence of an event which neither [the union or

the employers] can manipulate (e.g., impasse).” Id. at 483.

Second, the Board has balanced the preservation of the in-

tegrity of multiemployer bargaining against the “rights” of

those employer members of an association who have not

negotiated interim agreements with the union after impasse.

As noted above, the facts of the instant case do not implicate

the second balancing undertaken by the Board, and, as such,

the balance struck by the Board in that instance need not be

reviewed by this Court herein. !*

''“The union, under the Board’s own policy, should not have been given

two weapons for its economic arsenal (i.e., the selective strike and individual

negotiations) while the employers are given only one (viz., the lockout) .” 522

F.2d at 483.

12 While not at issue in the instant case, the Board stated the results of its

balancing of this second set of interests as follows:

We have considered carefully the implications for multiemployer

bargaining of interim agreements negotiated during impasse and con-

clude that such agreements may prevent significant unit fragmentation

rather than cause it and do tend to facilitate the breaking of impasse.

Interim agreements of the type deemed appropriate under our stand-

ards discussed supra are calculated to further, not destroy, unit integri-

18

As relates to the balancing of the first set of “conflicting in-

terests,” the Board first reaffirmed (see P. 41-42) its position

set out in Hi-Way Billboards, Inc., 206 NLRB 22 (1973), sup-

plementing 191 NLRB 244, enforcement denied, 500 F.2d i81

(5th Cir. 1974), wherein it viewed an impasse as an expected

part of negotiations which calls into play the use of economic

weapons by both sides in an attempt to restart the flow of

negotiations, and concluded that multiemployer bargaining,

as a practical matter, would be destroyed if members of the

unit were permitted to withdraw upon a bargaining impasse,

since a member could then avoid his bargaining obligations by

intentionally creating an impasse if an impending agreement

was unfavorable. '*

The Board, subsequently, addressed the alleged conflicting

interest, which was perceived by the Third Circuit to be the

imbalance of economic weapons, and concluded that, while

the Third Circuit’s perception of an imbalance of economic

weapons itself was incorrect,'* an alleged imbalance of econo-

ty inasmuch as they preserve a continuing mutual interest by all

employer-members in a final associationwide contract. The provisions

of the Act itself, rather than relative bargaining strengths, are the

determinative factors in assessing the legality of particular forms of

economic pressure (P. 51; footnote omitted).

'3In this regard, the Board in Hi-Way Billboards, Inc., stated the follow-

ing:

Were we to hold otherwise, we would be denying the practical reality

of collective-bargaining negotiations, we would herald the demise of

multi-employer bargaining, we would effectively negate the benefits

of such bargaining to all parties and to the employees, and we would

allow an employer to seize upon such an occurrence and use it as a

ground for withdrawal merely because it was dissatisfied with the im-

pending agreement, as Hi-Way did in the instant case. Consequently,

we hold that it would not effectuate the purpose or policies of the Act

to allow an employer member of such an association to withdraw sole-

ly on the ground that an impasse in negotiations has been reached.

206 NLBB at 23.

See Argument II, infra.

19

mic weapons is not a legitimate interest to be balanced against

the national policy in favor of multiemployer bargaining (see

P. 49-50). As such, the Board had little trouble in striking the

balance and finding that an impasse alone does not form an

adequate basis for a party’s nonconsensual withdrawal from

multiemployer bargaining. Specifically, the Board concluded

that “[cJonsidering the facts as described above in footnote 2,!"!

including the achievement of the multiemployer bargaining

objective to continue the method of driver-pay on wage basis,

and the supportive action that the lockout afforded the Re-

spondent during the strike against it, we see no reason to allow

the Respondent to withdraw from the multiemployer unit in

untimely fashion” (P. 51).

As detailed above, the Board, by restricting unilateral with-

drawal at impasse, clearly is effectuating the continued

viability of multiemployer bargaining and, accordingly, the

balance it has struck has a sound legal foundation. Therefore,

‘5 Footnote 2 of the board’s decision provides as follows:

The Respondent is in the business of laundering and renting uni-

forms and linens. It has been a member of the Group which has

negotiated with the Union for several years. Before the last contract

expired in April 1975, negotiations were duly opened for a new agree-

ment and the Respondent authorized the Group to bargain in its

behalf. The Respondent participated in the negotiations. Impasse

was reached in May 1975 over whether the employees would be paid

on a commission basis or remain on wages. Thereafter, in June 1975,

the Union called a selective strike against the Respondent, and most of

the Group responded by locking out their employees. After some 5

months during which the situation remained static, with all efforts to

break the impasse failing, the Respondent withdrew from the Group.

The remaining Group members then terminated the lockout and

negotiations resumed with the Respondent absent. In April 1976,

when the Union dropped its demand for compensation by commission,

an agreement was reached. The Union thereafter informed the Re-

spondent that it had not consented to the withdrawal and thus con-

sidered the Respondent bound by the terms of the agreement reached

with the Group. The Respondent denied that it was bound and re-

fused to execute the agreement (P. 38-39).

20

the Board’s determination is entitled to deference under the

standard of review enunciated by this Court.

Moreover, under the decisions of this Court, the balance

could not have been struck in any other manner, since the

asserted imbalance of economic weapons has been rejected by

this Court as an appropriate concern for the Board. See, e.g.,

NLRB v. Insurance Agents’ International Union, 361 U.S.

477, 490 (1960) (“Our labor policy is not presently erected on a

foundation of government control of the results of negotia-

tions... . Nor does it contain a charter for the National

Labor Relations Board to act at large in equalizing disparities

of bargaining power between employer and union”); NLRB v.

Brown, 380 U.S. at 283 (“We begin with the proposition that

the Act does not constitute the Board as an ‘arbiter of the sort

of economic weapons the parties can use in seeking to gain ac-

ceptance of their bargaining demands’”); American Ship

Building Co. v. NLRB, 380 U.S. at 317 (the Act does not “give

the Board a general authority to assess the relative economic

power of the adversaries in the bargaining process and to deny

weapons to one party or the other because of its assessment of

that party’s bargaining power’).

Furthermore, the Third Circuit in NLRB v. Beck Engraving

Co., 522 F.2d at 483, itself recognized that “to some extent,

basing the right of withdrawal upon the existence of an im-

passe rather than of individual negotiations contributes to in-

stability within the context of multi-employer bargaining.”

See also id. at 484, where the Third Circuit stated that “we

cannot avoid the conclusion that this additional incremental

instability, however unfavorable to the policy aimed at stabili-

zation of these units, is a necessary concomitant of ensuring

that the parties have equal rights and that the existence and

implementation of such rights do not grant unfair advantage

to either party.”

Accordingly, even under the broadest standard of review,

the Board’s determination that an impasse alone does not

justify unilateral withdrawal would be entitled to affirmance,

21

since there is no dispute that a contra determination would

have frustrated national labor policy by creating instability in

multiemployer bargaining, and since there can be no reason-

able claim that the balancing of economic weapons is a

legitimate conflicting interest. As such, it is beyond peradven-

ture that the First Circuit herein gave appropriate deference to

the Board’s policy judgment.

II. THe Decision or THE THIRD Circurr Coury or APPEALS

1s NEITHER Persuasive Norn CONSONANT WITH THE STANDARD

oF Review ARTICULATED BY TH1s Court.

In applying its “unusual circumstances” guideline, the

Board initially met with substantial resistance from a number

of reviewing courts in decisions involving the existence of a

bargaining impasse and/or the negotiation of interim agree-

ments. See Fairmont Foods Co. v. NLRB, 471 F.2d 1170 (8th

Cir. 1972); NLRB v. Hi-Way Billboards, Inc., 473 F.2d 649

(5th Cir. 1973); NLRB v. Associated Shower Door Co., 512

F.2d 230 (9th Cir.), cert. denied, 423 U.S. 893 (1975); NLRB

v. Beck Engraving Co., supra; NLRB v. Independent Associa-

tion of Steel Fabricators, Inc., 582 F.2d 135 (2d Cir. 1978),

cert. denied, 439 U.S. 1130 (1979). At least in the case of Fair-

mont Foods Co. v. NLRB, the resistance can be traced to the

failure of the Board prior to 1973 to articulate a consistent im-

passe doctrine in the multiemployer bargaining context. '®

However, subsequent to the decision of the First Circuit

herein, much of that early resistance has dissipated, as the

Fifth Circuit has reconsidered its position taken in NLRB v.

Hi-Way Billboards, Inc., and has adopted the Board’s present

impasse doctrine, see NLRB v. Marine Machine Works, Inc.,

635 F.2d 522, 526 (5th Cir. 1981); and the Eight Circuit has

indicated that Fairmont Foods Co. v. NLRB, “can no longer

be considered controlling” in that circuit. Tobey Fine Papers

'°Comment, 17 B.C. Indus. & Comm. L. Rev. 525, 528-530 (1976).

22

v. NLRB, F.2d , , 107 LRRM 2221, 2222 n.3 (8th

Cir. 1981).

In addition, as noted by the First Circuit below, NLRB v.

Associated Shower Door Co." and NLRB v. Independent

Association of Steel Fabricators, Inc. “hinged on the belief

that the negotiation of individual agreements had unfairly

tipped the balance of bargaining power, and not on any

conviction that impasse alone justifies unilateral withdrawal.”

630 F.2d at 33 (P. 33).

In this regard, in Associated Shower Door, negotiations be-

tween the union and the multiemployer association had

reached an impasse, and the union had called a strike against

all members of the association. Subsequently, individual

agreements were reached between the union and several of the

association members. Thereafter, several association

members unilaterally withdrew from the multiemployer unit,

although there was evidence that these members later rejoined

the association. Associated Shower Door Co., Inc. , 205 NLRB

677, 679-80 (1973).

The majority of the Board concluded that the negotiating

impasse coupled with the individual contracts did not justify

the unilateral withdrawal of an association member and that

in any case the actions of the respondent employers reestab-

lished the agency relationships with the association. 512 F.2d

at 677. In a concurring opinion Chairman Miller, while

agreeing that the employers had rejoined the association,

would have ruled that the making of individual agreements

after an impasse is reached is sufficient justification for uni-

lateral withdrawal. Id.

Enforcing the Board's order based on its finding that the

employers had rejoined the association, the Ninth Circuit,

noting the following, agreed with Chairman Miller’s position:

‘The Ninth Circuit recently reaffirmed its holding in Associated Shower

Door. See H. & D, Inc. v. NLRB, 633 F.2d 139 (9th Cir. 1980).

23

The Board has held that a union which has commenced

collective bargaining with a multi-employer unit may

withdraw from the multi-employer unit with respect to

one or more employers while continuing multi-employer

bargaining with those employers remaining in the multi-

ple unit. Pacific Coast Association of Pulp and Paper

Manufacturers, 163 N.L.R.B. 892, 895-896 (1967). Since

the Board has committed itself to preserving the equality

of withdrawal rights in the multi-employer unit situa-

tion, see The Evening News Association, 154 N.L.R.B.

1494, 1495-1497 (1965), enforced sub. nom. Detroit

Newspaper Publishers Association v. NLRB, 372 F.2d

569, 572 (6th Cir. 1967), it seems only fair that, when an

impasse is reached and a union then engages in selective

picketing and enters into substantial individual

agreements with employers who had been members of

the multi-employer unit, the withdrawal of the remain-

ing members of the unit, if unequivocally communicated,

should be permitted. See NLRB v. Hi-Way Billboards,

Inc., 500 F.2d 181, 183-184 (5th Cir. 1974); Fairmont

Foods Company v. NLRB, 471 F.2d 1170, 1172-1174,

1174 n.1 (8th Cir. 1972); Connell Typesetting Company,

212 N.L.R.B. No. 140 (1974).

512 F.2d at 232 (emphasis added).

Thus, in Associated Shower Door, it was the fact that the

Board had allowed the union in that case to negotiate in-

dividually with the association members that persuaded the

court to allow the respondent-employers to withdraw. This

conclusion is supported by the fact that the Ninth Circuit cited

the Board’s decision in Connell Typesetting Co., 212 NLRB

918 (1974), as support for its conclusion. Connell Typesetting

was decided a year after the Board’s Associated Shower Door

decision and involved employer withdrawal from a multiem-

ployer unit after selective strikes had been engaged in, and

24

individual interim agreements entered into. The Board in

Connell Typesetting ruled that the union’s extensive negotia-

tion of interim agreements with employer members of the

association justified unilateral employer withdrawal. Id. at

921.

Similarly, the union in Steel Fabricators had called a strike

against all members of the multiemployer bargaining associa-

tion after negotiations broke down. Thereafter, the union

negotiated separately with four employer members of the

association and, ultimately, nineteen members of the associa-

tion unilaterally withdrew from multiemployer bargaining.

In reviewing that portion of the Board’s decision which

dealt with employer withdrawal rights at impasse, the Second

Circuit indicated that determining such withdrawal rights in-

volved the balancing of legitimate conflicting interests and

acknowledged that the striking of that balance is entrusted

primarily to the NLRB. However, the court, citing the in-

dividual negotiations, rejected the balance struck by the

Board. In this regard, the court stated the following:

That Local 455 agreed to negotiate separately with

four former members of the Association during the

August to January interval (Dextra, Atwater, North

Shore, and Charla) is also indicative of the inability of the

union and the Association to engage in fruitful discussion.

Moreover, although the union did not selectively picket

or otherwise pressure any particular member, its willing-

ness to negotiate separately with several members had

something of a whipsaw effect on the remaining members

who watched certain of their withdrawing competitors

resume business while they themselves were still in the

throes of an economic strike. Cf. N.L.R.B. v. Associated

Shower Door, supra, 512 F.2d at 232; N.L.R.B. v. Beck

Engraving, supra, 511 F.2d at 482-83; N.L.R.B. v. Hi-

Way Billboards, supra, 500 F.2d at 183.

582 F.2d at 147.

25

Accordingly, neither the decision of the Ninth Circuit nor

that of the Second Circuit is inconsistent with that of the First

Circuit herein, since same was premised on the existence of

both a bargaining impasse and the negotiation of interim

agreements. However, NLRB v. Beck Engraving Co. “is

squarely on point, 630 F.2d at 33 (P. 33); but, as detailed

below, that decision is neither persuasive nor consonant with

the appropriate standard of review.

In Beck Engraving, the respondent-employer had with-

drawn from the multiemployer bargaining association and

later argued that (1) the resignation of its employees from the

union, (2) the consent by the union to the withdrawal of

another member of the unit, and (3) the instigation of the

selective strike by the union against the respondent, repre-

sented “unusual circumstances” and thus justified its untimely

withdrawal. Beck Engraving Co. , 213 NLRB 53, 54-55 (1974).

The Board, however, rejected these facts as insufficient. The

respondent subsequently moved to have the Board reconsider

its decision, arguing that the parties had reached a bargaining

impasse and that such an impasse constituted an “unusual cir-

cumstance.” 522 F.2d at 478-479 & n.8. The Board denied

this motion and sought enforcement of its order.

The Third Circuit denied enforcement of the Board’s order.

The court perceived that the Board, in the context of multiem-

ployer bargaining, had permitted unions to engage in selective

strikes and enter into interim agreements while only permit-

ting employers to lock out their employees. As such, the Third

Circuit believed that there existed an imbalance of economic

weapons which justified “according the employer an equi-

valent right,” i.e., unilateral withdrawal at impasse. Id. at

483. Moreover, the court concluded that “[t]he employer's

right to withdraw during a bargaining impasse cannot be

made contingent upon the union’s prior exercise of its right to

negotiate individual interim agreements,” rather, “[t]he rights

of the parties should accrue simultaneously based upon the oc-

currence of an event which neither can manipulate (e.g., im-

26

passe).” Id. However, as pointed out by the First Circuit

below, see 630 F.2d at 31-32 and 34-35 (P. 29-30, 34-36), and

by certain commentators, '* the reasoning of the Third Circuit

is suspect.

First, this Court in NLRB v. Insurance Agents’ Interna-

tional Union, 361 U.S. at 488, restricted “any governmental

power” from acting as an “arbiter of the sort of economic

weapons the parties can use in seeking to gain acceptance of

their bargaining demands.” Id. at 497. Thus, this Court re-

quires that the legitimacy of a bargaining tactic be determined

isolated from any notion of relative bargaining strength and

based on the pertinent statutory standard. The Third Circuit

violated said requirement when it granted withdrawal rights

based not on a thoughtful analysis of the Act, but, rather, on

an assessment of the parties’ relative bargaining position. This

form of balancing improperly affects the substantive terms of

the ultimate collective bargaining agreement — an effect de-

nounced in NLRB v. Insurance Agents’ International Union.

See id. at 497-498.

Second, even if the Third Circuit’s balancing of economic

weapons was permissible conceptually, it was extremely im-

precise. In this regard, in addition to the three “economic

weapons” noted by the court, this Court permits, inter alia,

(1) union harassing tactics while on the job, see id. at 490-492,

(2) the struck members of an association to lock out their union

employees and hire temporary replacements, see NLRB v.

Mackay Radio & Telegraph Co., 304 U.S. at 345, (3) the non-

struck members of an association to lock out their union

employees and hire temporary replacements, see NLRB v.

Brown, 380 U.S. at 283, (4) all association members to use the

lockout offensively, see American Ship Building Co. v. NLRB,

380 U.S. at 318, (5) all association members to make unilateral

'®See Murphy, Impasse And The Duty To Bargain In Good Faith, 39 U.

Pitt. L. Rev. 1, 50-60 (1977); Comment, 17 B.C. Indus. & Com. L. Rev.

525, 533-540.

27

changes in working conditions consonant with the offers the

union has rejected, see NLRB v. Katz, 369 U.S. 736, 745 and

n.12 (1962), and (6) all association members to blunt the effec-

tiveness of an anticipated strike by stockpiling, readjusting

schedules and transferring work. See NLRB v. Brown, 380

U.S. at 283. As such, the basic premise of the Third Circuit’s

Gecision, i.e., an imbalance of economic weapons, is both con-

ceptually and factually defective.

Third, the court’s contention that a bargaining impasse can-

not be manipulated ignores the present state of the law which

permits “hard bargaining” and “provides a party with a

means of withdrawing whenever the impending agreement

proves objectionable.” 630 F.2d at 34 (P. 35). Moreover, the

Third Circuit’s rationale that the “rights of the parties should

accrue simultaneously,” 522 F.2d at 483, is inconsistent with

court-supported Board findings «f “unusual circumstances” in

situations other than those involving impasse.

Thus, for example, in Spun-Jee Corp., 171 NLRB 557 (1968),

the Board, after examining the individual facts of the case, con-

cluded that the economic distress of the respondent-employer

justified its unilateral withdrawal. Id. at 557-558. In that case

there was no “simultaneous” occurrence of withdrawal rights of

the employer and the union. In fact, the employer's with-

drawal had no effect on the bargaining responsibilities of the

union vis-a-vis the remaining association members.

Similarly, in Connell Typesetting Co., supra, the Board

found that the union had fractured the multiemployer unit by

entering into interim agreements with one-half of the employers

in the multiemployer unit. The Board then concluded that the

union’s action constituted “unusual circumstances” justifying

the respondent-employers’ withdrawal. 212 NLRB at 921.

Clearly, in Connell Typesetting the employers’ withdrawal

rights were contingent upon the union’s actions in entering into

interim agreements. Thus, in that case, an employer's

withdrawal rights were not based upon the occurrence of an

event which neither could manipulate.

28

Accordingly, the analysis of the Third Circuit in Beck clear-

ly is unpersuasive. Furthermore, that analysis ignores the

standard of review articulated by this Court.

In this regard, the Third Circuit in Beck readily

acknowledges that its decision “contributes to instability

within the context of multi-employer bargaining’ and, as

such, is “unfavorable to the policy aimed at stabilization of

{multiemployer] units.” 522 F.2d at 483-484. However, the

Third Circuit believes that the balance of “conflicting inter-

ests” must be struck in favor of remedying the perceived im-

balance of economic weapons. Thus, even if the defects in the

Third Circuit’s analysis are overlooked, it is evident that the

court has made itself primarily responsible for striking the

balance between the conflicting interests “to effectuate na-

tional labor policy,” NLRB v. Truck Drivers Local 449, 353

U.S. at 96, and thereby has usurped the function of the Board,

as delegated by Congress.

In sum, the decision of the First Circuit herein is in conflict

with that of the Third Circuit in Beck. However, while the

decision below is analytically sound, that of the Third Circuit

is neither persuasive nor consonant with the standard of re-

view enunciated by this Court.

Conclusion.

Multiemployer bargaining serves a vital national interest.

Its preservation, however, is contingent on restricting severely

a party’s right to unilaterally withdraw from such bargaining

once negotiations have commenced. An impasse is a common

and temporary stage in normal collective bargaining and may

be manipulated by a party. As such, linking a party’s noncon-

sensual withdrawal rights to the existence of a bargaining im-

passe would make the maturing of such rights commonplace

and would sanction unfettered withdrawals. Such a result

would be antithetical to multiemployer bargaining and, in

turn, to the national interest.

29

In the instant case, Bonanno participated in multiemployer

bargaining as long as it served its own interest. In particular,

Bonanno readily accepted the protective umbrella of the

Association-wide lockout and only withdrew from the Associa-

tion after it had hired permanent replacements for its striking

employees, and thereby rendered unnecessary the protections

available through the Association. Thus, the instant case

represents a classic example of how multiemployer bargaining

will be weakened or destroyed should this Court overrule the

balance struck by the Board and find that a bargaining im-

passe, standing alone, justifies a party’s unilateral withdrawal

from multiemployer bargaining.

Accordingly, Respondent, Teamsters Local Union No. 25,

respectfully urges this Court to affirm the decision of the First

Circuit below.

Respectfully submitted,

JAMES T. GRADY,

GABRIEL O. DUMONT, JR.,

GRADY anp McDONALD,

ATTORNEYS AT LAW, P.C.,

75 Federal Street,

Boston, Massachusetts 02110.

(617) 426-9450

Attorneys for Respondent,

Teamsters Local Union No. 25